The Employment Rights Bill in the UK: Implications for local authority employers

Whilst lengthy and packed with new proposals, there are still huge gaps in the detail and practical application. More consultation and draft regulations are promised over
the coming two years. It does, however, present challenges for local authorities in that;

• the political dimension with local authorities means that there may be political objection to the changes or indeed politicians that want their local authority to enhance the rights of employees beyond what is proposed in the ERB;
  
• local authorities employ large numbers of staff in a wide range of roles, from those in office-based roles to front-line staff;
  
• local authorities engage workers on a variety of terms including part-time, full-time, permanent, temporary, fixed-term contacts, variable-hour contracts, agency staff, consultancy arrangements and more;
  
• local authorities have significant engagement with trade unions and other arrangements which affect
  worker terms and conditions such as collective agreements, Green Book terms, Burgundy Book terms for teachers and the National Joint Council; and
  
• local authorities are tasked with balancing the public interest, fiscal responsibility and regulatory compliance.

Here are some of the headlines from the ERB of specific importance to local authorities.*

Day-one rights

Much, understandably, has been written about new day-one rights. The Employment Rights Act 1996 will be amended to remove the two-year qualification period for a claim. However, the Government is introducing a statutory probationary period the details of which have yet to be published. We know that an employer will need to follow some sort of ‘light’ procedure during the statutory probationary period if the dismissal (for reasons relating to employees’ conduct) is to be fair. We do not know what the ‘light procedure’ will look like and how that will fit with the ACAS codes.

Neither do we know how long the statutory probationary period will be although the Government seems to prefer nine months. These changes will not come into force until autumn 2026 at the earliest.

Flexible working

The Government’s commentary on this part of the ERB would suggest an overhaul to the existing system. This is not the case in reality. The day-one right to request flexible working remains in place, as introduced by the previous government. Likewise, the eight permitted reasons for rejecting a request remain. The key change is the addition of the reasonable test; a refusal of a flexible working request for one of the eight permitted reasons must be reasonable and the employer must be able to consider why their decision is reasonable. The Government expects that employers will find it harder to refuse requests hence its promise that flexible working will become a ‘default right’. We have no timings as to when this will be in place and await additional regulations.

Trade union changes

It is no surprise that a Labour Government has dedicated the entirety of a section of the ERB to trade union issues. Its purpose is to overhaul current trade union legislation, which it believes places unnecessary restrictions on trade union activities. These plans are as follows:

• workers are to be informed of their right to join a union in section 1 statements;
• new rights of access for trade unions in the workplace; and
• simplifying the recognition process by lowering membership thresholds and support requirements for industrial action.

In addition, the Strikes (Minimum Service Levels) Act 2023 will be repealed by the ERB once it becomes an Act of Parliament. What is important to note is that some trade union changes are expected sooner than others. The ERB noted that the section alluding to trade union change would come into effect two months after the Bill received Royal Assent. The Government has opened a consultation on its plans for trade union reform. You can contribute to this process here.

Collective redundancy

The ERB also makes a small but key change to the collective redundancy process. The current duty to carry out collective redundancy consultation where it is intended to make 20 or more employees redundant in one establishment will lose the term ‘one establishment’. This means that all redundancies across an organisation, regardless of geographical location or function, will need to be taken into account when assessing whether a collective consultation is necessary.

Sexual harassment

As of 26 October 2024, all employers are under a mandatory duty to take reasonable steps to prevent sexual harassment in the workplace. The ERB has extended that duty; employers need to take all reasonable steps to protect staff including third parties as third-party harassment has been re-introduced into the Equality Act 2010.

Re-introduction of two-tier workforce provisions

There was previously a code of practice in place which required local authorities to prevent the establishment of a two-tier workforce where they outsource services. This meant that they had to ensure that new staff employed alongside transferred workers were on no less favourable terms of employment overall (although there was a limited exception for pensions). The ERB provides for wording to be inserted into the Procurement Act 2023 giving the power to make regulations and to publish a code of practice to ensure that there is no difference in treatment between transferred workers, the authority’s retained staff and the supplier’s staff.

As with many areas of the ERB, what this means in practice will depend on the terms of the regulations
and code of practice. However, it seems clear that the intention behind this is to ensure that decisions to outsource services do not result in a downgrade in terms of employment for those delivering those services. In effect, this will extend the right of comparison with authority staff for equal pay purposes to staff employed by private and third sector providers.

This may well have a significant impact on the outsourcing of public services.

For more information please contact Matthew Gregson and Sarah Harnett.

_{*for more detail on the ERB , please read our blog.}

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