On 5 March 2025, the Government published significant amendments to the Employment Rights Bill, following various consultations since the Bill was first published last year.
Despite the consternation expressed by some employers about the additional compliance burden of the Bill, the Government's amendments largely serve to strengthen the legal protections for workers and employees - in some cases, significantly expanding their scope.
The new changes to the Bill include the following:
1. New rights for agency workers
The most complex provisions of the Employment Rights Bill are those creating new rights for zero hours workers (and those with a low number of guaranteed hours) to be offered a guaranteed hours contract reflecting the hours they actually work, to be given reasonable notice of shifts, shift changes and cancellations, and compensation for cancelled or altered shifts. The new amendments now extend those rights to agency workers, adding a further layer of complication. The hirer (i.e. the end-user) will be responsible for offering the guaranteed hours contract, but responsibility for shift/cancellation/change notices is shared between the hirer and agency.
As with the existing provisions in the Bill for zero hours workers, specific details of which workers are eligible will be set out in regulations, along with details such as how long the notice must be.
The Bill also now contains some further changes to the rights for both agency and zero hours/low hours workers. Interestingly, it provides that employers can contract out of these rights via a collective agreement, reflecting the Government's focus on increasing the role of trade unions in the workplace. It also contains new anti-avoidance provisions to prevent employers manipulating shift patterns to prevent workers becoming eligible.
2. Regulation of umbrella companies
Alongside the beefing up of agency worker rights, the Government's amendments will extend regulation of employment businesses to include umbrella companies (often used to employ agency workers in supply chains). This means that employees of umbrella companies will have certain rights currently applicable to agency workers, and that umbrella companies ultimately will be regulated by the Fair Work Agency which will be established under the Bill.
3. Statutory Sick Pay (SSP):
Eligibility for SSP will be expanded to include workers earning less than £123 per week (the current threshold for SSP eligibility). These workers will now receive 80% of their average weekly earnings or the standard SSP rate, whichever is lower.
4. Collective redundancy consultation
The Bill previously proposed removing the words “at one establishment” from the definition of collective redundancies, so that multi-site employers would have been much more likely to need to carry out collective redundancy consultation. Those employers will be reassured by the new Government amendments, which allow the Government to introduce a higher threshold (i.e. more than 20 redundancies) where redundancies are being made at more than one establishment. The new amendments also clarify that employers dealing with multi-establishment redundancy exercises don't need to consult all the representatives together or try to reach the same agreement with all of them, recognising that consultation may need to be site-specific.
But there's a sting in the tail. As previously trailed, the Government is increasing the maximum penalty for failure to consult collectively from 90 days' pay to 180 days' pay per affected employee. The intention is to stop employers ‘pricing in’ a failure to comply (or at least make it a much higher price). However, the Government has abandoned plans to extend interim relief remedies (currently only applicable in whistleblowing, trade union and health and safety dismissal claims) to breaches of the collective consultation and fire and rehire rules.
5.Trade Union Rights
The Government's drive to strengthen the role of trade unions in the workplace is reflected in further amendments dealing with access to workplaces, industrial action and union recognition.
These include amendments doing the following:
- Speeding up the process for achieving a workplace access agreement
- Enabling access agreements to include digital access to a workplace by trade unions as well as physical access (something trade unions have long campaigned for)
- Simplifying the ballot process for strike action
- Simplifying the information which trade unions have to provide to employers prior to a strike
- Extending the period for which a trade union can rely on a strike ballot from 6 to 12 months
- Strengthening the protections against unfair practices by employers during the statutory union recognition process.
6. Bereavement Leave for Miscarriage:
Parents experiencing a miscarriage before 24 weeks of pregnancy will be entitled to two weeks of bereavement leave. (This isn't a Government amendment but is understood to have Government support.)
7. Fair Work Agency
New amendments significantly beef up the powers of the Fair Work Agency, including giving it the power to bring Employment Tribunal claims and issue underpayment notices to employers who fail to comply with certain obligations (including holiday pay and SSP), and impose substantial fines.
As with any major piece of legislation, the Government's amendments aren't the only ones which will be considered, but they are the most likely to be passed. As it works its way through Parliament, the Employment Rights Bill looks set to be the biggest shakeup of employment law in decades. Watch this space for further updates.
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