The world of work has undergone significant changes in recent years, with an increasing number of workers employed on a casual or gig basis.
The ONS reported that 26.2% of non-permanent workers in the UK were on zero-hours contracts in 2019 and In 2020 alone, and this is likely to have increased since due to the pandemic.
The Worker’s Bill, due to be tabled by the government in the coming months, is a crucial piece of legislation that could potentially have a huge impact on businesses operating within the UK.
The bill seeks to better protect casual and gig workers by introducing measures such as more secure contracts, minimum hours guarantees and improved holiday entitlements.
As an employer, the proposed changes are likely to impact your business in several ways too.
This could include higher wages costs, time spent ensuring your business meets the requirements, communicating the changes to workers in advance, and updating contracts & systems.
Read on for more information on the impact that proposed changes could have on your business.
What Is The Proposed Worker’s Bill?
The proposed Workers (Predictable Terms and Conditions) Bill is a piece of legislation in the UK that aims to provide workers with more stable and predictable working arrangements and is particularly aimed at those on casual or gig contracts.
The legislation will amend the Employment Rights Act of 1996, and The new legislation will allow workers to ask for a consistent work schedule that specifies the days of the week they work, the number of hours they work, their start and end times, and the duration of their employment. Other guidelines on work patterns may be provided by the law, and any work agreement that lasts less than 12 months will be considered unpredictable.
If the Workers (Predictable Terms and Conditions) Bill is passed into law, it could have a significant impact on businesses in the UK, particularly those that rely heavily on flexible or zero-hours contracts to fulfil seasonal changes and fluctuations in labour demands.
What Are The Proposed Changes?
The proposed changes in the bill include:
- A ‘right to request’ a fixed hours contract from employers, with clear and reasonable grounds for refusal
- A minimum number of guaranteed hours per week (e.g 20)
- Statutory paid holiday entitlements
- An obligation The bill seeks to introduce several measures that would benefit workers, such as guaranteeing a minimum number of hours and providing advance notice of schedules. It would also require employers to provide non-discrimination clauses in their contracts and protect workers from unfair dismissal.
What Are The Implications For Your Business?
If the proposed changes are implemented, there could mean that employers need to make significant changes to their current practices to comply with the new laws.
This may include increasing the number of hours or contracts offered to casual workers and establishing a system for calculating holiday pay entitlement.
It may also be necessary for employers to review their contract terms and conditions, update policies, and communicate the changes to all affected staff.
- Increased wages costs: If the bill includes provisions such as a higher minimum wage, mandatory paid leave, or minimum hours guarantee, employers may need to offer more hours to their casual workers, which will likely result in higher wage costs. This could impact the profitability of the business and potentially lead to higher prices for consumers.
- Changes to scheduling practices: If the bill includes provisions related to scheduling, such as requiring employers to provide advance notice of work schedules, this could impact the efficiency of the business and will require additional administrative work.
- Increased compliance requirements: Depending on the specifics of the bill, businesses may need to comply with additional requirements related to employment practices. This could require additional paperwork and potentially lead to fines or penalties for non-compliance.
- Potential benefits for employees: Employees may be entitled to additional benefits such as paid leave, healthcare benefits, or retirement benefits. While this could increase wage costs for the business, it could also lead to increased job satisfaction and potentially lower absenteeism and turnover rates, which could, in turn, reduce recruitment and training costs.
- Time spent: Employers will need to spend time and resources informing their staff of these changes, updating policies and contracts and making the necessary adjustments to scheduling systems.
- Reduced flexibility: The bill seeks to reduce the reliance on flexible or zero-hours contracts, which could, in turn, reduce the flexibility that employers have to respond quickly to changes in demand.
How Will It Work In Practice?
Workers will be able to request a more predictable working pattern under the proposed legislation, and to do this, they must specify the changes they seek from their employer.
- Within 12 months, employees may make up to two requests, provided they have completed a six-month qualifying period of service.
- Employers must hold a meeting with the worker to discuss the request and can refuse it on grounds such as insufficient work, negative impact on the business or inability to meet customer demand.
- Employers who refuse requests without justifiable reasons risk facing an automatic unfair dismissal claim at an Employment Tribunal if the employee has exercised their statutory right.
- Employers must assess and respond to the request within one month of receiving it, even if the employee has ended their contract.
- Employers should avoid discriminating based on any protected characteristic and implement a fair procedure to assess requests, thus avoiding Employment Tribunal claims.
The Worker’s Bill will have a significant effect on businesses operating in the UK, particularly those employing casuals or gig workers.
In anticipation of the Workers (Predictable Terms and Conditions) Bill becoming law, businesses should review their current employment practices and consider how they may need to adjust to comply with the new requirements. This may involve changes to scheduling practices, contractual arrangements, and employment policies.
Employers may face increased wage costs and administrative burdens as they adjust to comply with the new requirements of the bill, but if they fail to act, they will be at risk of legal implications associated with non-compliance, which could result in penalties or fines.
Neathouse Partners can help you to ensure that your business is prepared for and compliant with all requirements of the proposed Worker’s Bill. If you would like support with managing and understanding your employer’s responsibilities regarding workers’ rights, procedures and policies, please call 01244 893776 to talk to our friendly team.