Employment Rights Bill : A Guide for Small Businesses
UPDATED 29th November 2024
The Employment Rights Bill is set to bring significant changes to UK workplaces, especially for small businesses. While it’s not law yet, and debates about its feasibility are ongoing, now is the time to start preparing. Acting early ensures you’re not caught off guard, even as details of the bill continue to evolve.
In this blog, we’ll explore what the Employment Rights Bill could mean for small businesses, the concerns raised about its practicality, and the steps you can take now to stay ahead.
What Is the Employment Rights Bill?
The Employment Rights Bill UK is a proposed piece of legislation aimed at improving employee protections across the UK. While the bill has not yet become law, it’s sparking plenty of debate. Experts, including the Regulatory Policy Committee (RPC), have flagged concerns about whether the bill is “fit for purpose.” Despite this, it’s crucial for small businesses to prepare, as many of the proposed changes may eventually be implemented in some form.
Key Proposals in the Draft Bill
Though the final details are still being debated, the draft Employment Rights Bill is expected to include:
- Improved protections for gig and zero-hours workers: Providing fairer treatment and predictable schedules.
- Flexible working from day one: Ensuring all employees can request flexibility from the start of their employment.
- Restrictions on fire and rehire practices: Preventing unfair dismissal and renegotiation tactics.
- Stronger sick pay policies: Enhancing paid leave rights during illness.
- Higher penalties for non-compliance: Increasing legal and financial consequences for businesses.
Although these measures are intended to improve workplace fairness, the RPC has raised concerns about their potential economic impact, particularly on small businesses. However, waiting for the debates to conclude could leave you scrambling to comply if the bill becomes law.
Why Does the Employment Rights Bill Matter?
When Will the Employment Rights Bill Be Introduced?
The Employment Rights Bill 2024 doesn’t have a fixed timeline for implementation, but the government is actively discussing its progress. Businesses should expect changes in the near future, despite ongoing concerns about its feasibility. Waiting until the last minute to prepare could create unnecessary risks and costs.
The Economic Impact
The Regulatory Policy Committee (RPC) has warned that the bill may not be “fit for purpose” and could negatively affect certain sectors. Concerns include:
- Lower pay: Businesses might reduce wages to offset the costs of compliance.
- Fewer jobs: Particularly in industries reliant on temporary or zero-hours contracts.
- Added pressure on small businesses: SMEs may struggle to implement these changes without proper preparation.
While these debates continue, the potential for significant change means businesses must act now to minimise disruption and costs.
What Small Businesses Need to Know
If you’re a small business owner, it’s easy to feel overwhelmed by proposed legislation that isn’t even finalised. The key is to focus on practical steps you can take now. Preparing early allows you to stay flexible and ready to adapt, even if the Employment Rights Bill UK undergoes further revisions.
1. Flexible Working from Day One
One of the major proposals is requiring businesses to offer flexible working options from an employee’s first day. While this idea is still under debate, small businesses can start preparing by:
- Exploring hybrid or remote working possibilities.
- Offering flexible hours to support employees with caregiving responsibilities.
- Reviewing job roles to identify where flexibility can work without disrupting operations.
2. Zero-Hours Contracts
Stronger protections for zero-hours workers are expected, including the right to more predictable schedules. Even though this isn’t law yet, small businesses should:
- Avoid reliance on last-minute shift changes.
- Provide clarity in contracts about expected working hours.
3. Fire and Rehire Practices
The bill aims to limit unfair fire and rehire practices. Even though this is still under review, it’s a good time to ensure your dismissal policies are clear, fair, and compliant with existing laws.
How Small Businesses Can Prepare
Even with the RPC’s concerns and ongoing debates about the bill, small businesses shouldn’t delay preparation. Acting now gives you a chance to spread out costs, adjust processes gradually, and avoid last-minute stress.
Audit Your Current Policies
Start with a thorough review of your current HR policies, particularly those that may be impacted by the bill. Focus on:
- Scheduling practices: Are you providing fair notice for shifts?
- Flexible working: Do you have clear policies in place?
- Sick leave: Is your policy in line with the expected stronger employee rights?
Update Employee Contracts
Use this time to revise contracts so they’re ready for potential changes. Include:
- Flexible working terms: Anticipate requests from day one of employment.
- Clear dismissal policies: Strengthen your terms to avoid disputes over fire and rehire practices.
Leverage HR Tools
HR software can make compliance less daunting. Tools like Breathe HR can help you:
- Track employee schedules and time-off requests.
- Digitise and update contracts easily.
- Automate compliance tasks to reduce errors and save time.
Train Your Managers
Your managers will play a key role in implementing changes. Provide them with training on:
- The potential changes in the Employment Rights Bill UK.
- How to communicate policy updates to employees.
- Fair practices for handling flexible working and scheduling requests.
Balancing Preparation and Uncertainty
The ongoing debates about whether the Employment Rights Bill is “fit for purpose” shouldn’t stop you from preparing. Here’s why:
Avoiding Fines and Legal Risks
Even if the final bill is watered down, some form of change is likely. By acting now, you can ensure your business is ahead of the curve, avoiding costly fines or legal battles later.
Spreading Out Costs
Adjusting your policies and processes gradually allows you to spread out costs and avoid a financial hit when the bill becomes law.
Building Employee Trust
Your employees will notice if you take their rights seriously, even before the law requires it. Early preparation signals that you value their well-being, which can boost morale and retention.
Real Talk: Challenges for Small Businesses
While preparing for the bill is essential, it’s important to acknowledge the challenges small businesses face. The economic impact of these changes could be significant, but acting early makes the transition smoother.
Zero-Hours Contracts
If your business relies on zero-hours contracts, stricter regulations may require you to rethink your approach. Look for ways to offer more predictable scheduling or shift toward part-time roles.
Flexible Working
Accommodating flexible working may seem daunting, but it doesn’t have to mean overhauling your business. Start small by offering trial flexibility in certain roles and building on what works.
Don’t Wait for Final Decisions
The Employment Rights Bill UK may still be under debate, but that’s no reason to wait. Acting now puts your business in a stronger position, regardless of how the legislation evolves.
Take the First Step
If you’re unsure where to start, consider a professional HR consultation. KUHR offers a FREE HR Health Check to help small businesses identify gaps and plan for compliance.
Wrapping Up
The Employment Rights Bill isn’t law yet, and with concerns raised by the Regulatory Policy Committee, it’s likely to face further debate and revisions. However, this uncertainty doesn’t mean you should delay preparing. By reviewing your policies, updating contracts, and training your managers, you’ll be ready for whatever the final legislation brings.
Taking action now ensures you’re not only compliant but also fostering a fairer, more supportive workplace. And that’s something your employees will appreciate—whether the bill becomes law or not.
Start preparing today for the Employment Rights Bill. Your business—and your team—will thank you later.
