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Last week the King delivered his speech to the House of Lords, introducing 40 legislative bills compared to last year's 21, which you might say is an indication of the new Government's determination to make swift progress.
Several significant proposals were outlined, which will impact our industry over time, and ultimately your business too. Key among the new bills are the long-awaited Employment Rights Bill, legislation for the creation of Skills England, reform of the Apprenticeship Levy, and initiatives to support fair wages and working conditions. The Government's focus on economic growth and partnership with businesses is also noteworthy. The Recruitment and Employment Confederation’s (REC) have issued their analysis, and we wanted to share the highlights with you.
The Employment Rights Bill
This is likely the most significant legislation for our industry, introducing several changes. Proposals include:
· Banning "exploitative" zero-hour contracts
· Establishing a single enforcement body called the Fair Work Agency
· Enhancing 'Day One' rights for workers
· Prohibiting fire and rehire practices.
The REC has engaged with Deputy Prime Minister Angela Rayner and officials to shape these proposals, noting shifts in tone, such as targeting only exploitative zero-hour contracts rather than an outright ban. The commitment to ongoing business engagement is positive. However, the introduction of a single ‘worker’ status (that is, all workers regardless of sector, wage, or contract type being afforded the same basis rights and protections) was not included in the government paper released following the speech. The REC will continue to seek clarity on this matter, and we’ll be sure to discuss the impacts with you once they’re clear.
A new Industrial Strategy
The formation of an Industrial Strategy Council is welcomed by the REC and hopefully by you too. This Council will develop a comprehensive assessment of current and future skills needs, ensuring the industrial strategy is effective. The REC advocates for a strategic and coordinated approach to workforce planning, a long-requested measure. The REC is in discussions with the Department for Business and Trade (DBT) regarding the process and next steps, including membership criteria for the Industrial Strategy Council.
Skills policy and apprenticeship levy
The establishment of Skills England aligns with REC's calls for a better skills system. This new body aims to unify businesses, education providers, unions, and the Government to ensure the workforce is equipped with necessary skills. We’re hoping that by aligning training programs with market needs it will ease labour and skills shortages.
The reform of the Apprenticeship Levy, now termed the ‘Growth and Skills Levy,’ is a positive step too as it aims to provide businesses with greater flexibility in using levy funds. We support the REC's focus in ensuring that Labour's Growth and Skills Levy enables agency workers to access training to further their professional development, ultimately boosting your workforce productivity.
National Minimum Wage and Pay Changes
The Government's commitment to a “genuine” living wage and the removal of age bands reflects concerns about the cost of living. However, increased costs for businesses should be considered too. It is crucial for the Government to work closely with all stakeholders to balance worker benefits with business needs. Recent inflation-busting pay rises will no doubt caution against further pressures that might force businesses to cease operations.
The Equality Bill
The draft Equality (Race and Disability) Bill introduces mandatory ethnicity and disability pay reporting for larger employers (typically those with 250+ employees), addressing pay disparities. While this is a step forward for equal pay, it means additional reporting requirements for businesses.
Addressing economic inactivity
Although the King's Speech did not detail the Back to Work Plan Bill, it is expected to enhance employment opportunities and reduce barriers to work, particularly for disadvantaged groups. We’re hopeful this could mean increased support for getting people back into work, leading to a larger pool of job candidates. Specifics are yet to be released, but we’ll keep you updated once we have them.
