I wonder how my business can prepare for the Employment Rights Bill and the government's plan to Make Work Pay?

Significant changes are coming to UK employment law. The Employment Rights Bill 2024 brings forward concepts initially introduced in Labour's election manifesto and their Next Steps to Make Work Pay document. These have now evolved into key proposals within the Employment Rights Bill 2024, for which businesses must start preparing. This article highlights the most important changes and what employers need to know.

Where are we now?

The Employment Rights Bill 2024 is currently progressing through Parliament and is on its way to becoming law. However, rather than introducing entirely new legislation, the Bill amends 28 existing laws, making it challenging to keep track of all the updates.

On 27 March 2025, the Bill had its second reading in the House of Lords, and we should soon expect to see the proposed amendments following the reading. The Bill must still pass through the Committee stage, followed by a report to both Houses. Then, after the third reading and with agreement from both Houses, it will receive Royal Assent.

While many of the changes, particularly those outlined below, won’t take effect until Autumn 2026, businesses are being given a long lead time to adapt and prepare. This extended timeline reflects the significant adjustments needed in business practices and mindsets to comply with the new legislation.

What Are the Key Changes?

Here are the most important changes to prepare for:

1. Day-One Employment Rights: Employers will be required to follow a full and fair process when dismissing an employee, regardless of their length of service. A formal probationary period is expected to be introduced, with a streamlined dismissal process allowed during this time.
    
2. Guaranteed Hours for Zero-Hour and Agency Workers: Employers will be obligated to offer guaranteed contracted hours based on the workers' average hours over the previous 12-week period. Workers who prefer to remain on a zero-hours or agency basis will have the right to do so.
    
3. Compensatory Payments for Zero-Hour and Agency Workers: Employers will need to compensate workers on zero-hour or agency contracts if their shifts are cancelled or shortened at short notice.
    
4. End of ‘Fire and Rehire’: The practice of ‘fire and rehire’ will be classified as unfair dismissal if the primary reason for dismissal is that an employee refused to accept a change to their contract.
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5. Making Flexible Working the Default: While employees currently have the right to request flexible working from day one, the new legislation will require employers to provide a ‘reasonable’ decision when rejecting such requests.

In addition, there will be updates to family leave rights, statutory sick pay (SSP), and stronger enforcement measures, including financial penalties.

How Should I Prepare?

Although we don’t have all the details yet, it’s clear that the changes will impact recruitment, employee induction, and performance management. Employers should begin preparing now to ensure they are ready for the forthcoming legislation.

Here are some steps to take:

• Conduct an Impact Assessment: Use our handy tool to evaluate how the changes will affect your business.
• Create or Update Your People Strategy: Ensure your action plan accounts for the new requirements, as these will need time and resources to implement.
• Review or Define Your Company Values: These will be essential for effective recruitment and staff inductions.
• Upskill Line Managers: Train managers in recruitment, induction, and performance management to ensure they are well-equipped to handle the changes.
• Stay Updated: Subscribe to our mailing list to receive the latest updates on the Bill’s progress through Parliament.
• Join Our Make Work Pay Programme: Sign up for our comprehensive 6-month HR support and training programme, designed to help your organisation prepare for these changes.

For more information about the Employment Rights Bill or to discuss how our Make Work Pay Programme can support your business, please contact Cath Dixon, HR Consultant, on 07901 218091 or email cathdixon@warnergoodman.co.uk.