With the General Election in the UK fast approaching we’re taking a look at what a Labour win might mean for the hospitality sector. We’ll be summarising some thoughts from The Retail Bulletin below – can find the full article here
Labour’s potential victory in the general election in July could usher in the New Deal for Working People, necessitating swift action within the retail, leisure and hospitality sectors to deal with the impact of the changes.
Genuine living wage and removal of age bands
The previous Labour government introduced the National Minimum Wage. A new Labour government would seek to take this a step further by making the national minimum wage a real living wage that workers will be able to live on, reflecting for the first time the cost of living.
Alongside this and perhaps more critical for the sector is that Labour has confirmed that it will remove the age bands for national minimum wage so that all adults are paid the same, regardless of their age.
Removal of qualifying period for unfair dismissal claims
Labour are seeking to introduce is the removal of the qualifying period for unfair dismissal claims which is likely to make it more difficult for employers to dismiss their newer workers. Employers in the sector will therefore have a reduced ability to dismiss newer workers and will need to ensure that they have a robust and stringent dismissal policy and procedure to reduce the risk of claims.
Ban on ‘fire and rehire’ and zero-hour contracts
Labour will seek to end the practice of ‘fire & rehire’ meaning that employers will be unable to adopt this practice as a way of cost saving/ restructuring and may face fines or be ordered to pay compensation when they do.
Labour have also promised to ban zero-hour contracts that are ‘exploitative.’ The proposal is to provide workers with predictable hours and work by introducing a new duty on employers to provide a contract based on the hours worked in the proceeding 12-week period. Labour have confirmed that this will not impact seasonal or fixed-term contracts, still providing employers within the sector the ability to increase their staff numbers during peak times of the year, such as Christmas and school holidays.
Single worker status
Currently, there are three categories of workers in the UK, self-employed, worker, and employee. Each of these categories have varying level of employment protections and rights, with the self-employed being the least protected, and employees being the most protected; only employees are entitled to bring claims of unfair dismissal and redundancy. Accurately determining worker status can sometimes be an extremely difficult task, not only for the worker themselves, but for their lawyers, making it difficult to know protections and rights an employee should be afforded. If elected, Labour seeks to clarify this uncertainty by pooling worker and employees together.
Tips
A new Labour government would also ensure that all tips go to employees.
Sick pay
To be eligible for Statutory Sick Pay (SSP), an employee must satisfy the lower earnings limit (£123 per week as of April 2024) and have been ill for more than 3 days in a row. Labour is seeking to remove both requirements, making SSP more accessible.
Family rights
Labour also intends to strengthen a variety of family friendly rights for workers, including:
- Making parental and shared parental leave a day one right;
- Extending statutory paternity and maternity leave;
- Making it unlawful to dismiss a woman who is pregnant, on maternity leave, or has returned to work within in 6 months of her maternity, except in specific circumstances;
- Making unpaid carer’s leave paid; and
- Introducing the right to bereavement leave for all workers.
Right to switch-off
With an increase in working from home following the pandemic, some workers are beginning to feel that their homes are becoming a 24/7 office and find it difficult to ‘switch-off’ or say no to work outside of their normal working hours., Labour wants to introduce a right to ‘switch-off.’ however, Labour haven’t specified yet how they would aim to achieve this.
Extended Employment Tribunal limitation dates
As a rule, if an employee or ex-employee wants to bring a claim at the Employment Tribunal, they must do so within three months of the event they are complaining about. However, the Labour Party want to extend this to six-months.
Conclusion
The Labour Party have promised that their New Deal for Working People would introduce new employment legislation within 100 days of entering government. Although it’s impossible to say now whether the proposed changes would ensure fairer working conditions and greater job security for all, what is clear is that businesses in the sector should start to prepare now to ensure that they don’t face significant legal costs and/or have insufficient time to plan and potentially make changes to mitigate the impact.