The Employment Rights Bill 2024

Article by Jaspreet Bassi

The Employment Rights Bill was introduced into Parliament on 10 October 2024. This introduced 28 significant reforms to a range of measures. The Bill is designed to ensure that workers are provided with fair treatment in the workplace and improve workers’ rights in the UK.

What are some of the changes introduced by the Employment Rights Bill 2024?

The first change concerns unfair dismissal and probationary periods. Currently, employees must work for two years before they obtain the right not to be unfairly dismissed. However, the Bill is set to give employees the right to present claims for unfair dismissal from the first day of their employment. Employers will have to justify the employee’s dismissal through one of the existing five fair reasons and follow a fair process before dismissal.

The second change introduces restrictions on fire and rehire. Currently, the practice of firing and rehiring remains lawful. However, the Bill restricts employers’ ability to use fire and rehire. It will be deemed unfair for an employer to fire an employee where the reason for dismissing the employee is that they refused to agree to the employer’s attempt to vary the terms and conditions of their employment.

What is the impact of the Employment Rights Bill 2024 on businesses?

Deputy Prime Minister Angela Rayner has stated that millions of workers have been forced to face insecure, low-paid and irregular work for too long, while the UK economy has experienced low growth and low productivity. She believes that the Employment Rights Bill will upgrade workers’ rights, boost living standards and, in turn, help improve the UK economy.

However, the CEO of DCS Group, Michael Lorimer, believes the Employment Rights Bill will negatively impact businesses. He argues that giving employees full employment rights on day one of their employment might make it difficult for employers to make ‘risky hires’. For example, if an employer hires someone despite having some reservations but the employee proves to be a good asset, then everyone benefits. However, if the new hire’s employment does not work out, then the current law provides the employer with an exit strategy. The Bill will now erode this

flexibility for employers to make risky hires. This might make it further difficult for people struggling to find work because employers might choose to employ ‘safe’ hires, i.e. those with uninterrupted CVs and little complications. Lorimer suggests that businesses – particularly

SMEs – will find it difficult to manage the bureaucracy that will come with day-one employment rights. As a result, he believes that many SMEs will reduce hiring, increase their reliance on outsourcing or look at automation.

Sources

https://www.lewissilkin.com/insights/2025/03/13/whats-in-the-employment-rights-bill

https://www.shoosmiths.com/insights/articles/understanding-the-employment-rights-bill-2024-key-questions-answered

https://www.gov.uk/government/news/employment-rights-bill-to-boost-productivity-for-british-workers-and-grow-the-economy

https://www.cityam.com/labours-employment-rights-bill-is-ignoring-the-voice-of-business/