Employment Rights Bill risks failure if reforms rushed

Responding to the laying of amendments to the Employment Rights Bill, the Recruitment and Employment Confederation (REC) Chief Executive Neil Carberry said:

“Government says it is pro-business and targeting growth. Yet there are still clauses in the Bill that could put opportunities at risk for workers and further raise the costs for employers when taking a chance on people. On the positive side, there is still time to get things right in the Regulations which follow if government is led by what businesses and workers want now – a balance of flexibility and protection. 

“We welcome the government’s commitment to consultation and to handling much of the detail in the Bill via Regulations. This gives more time for discussions – but that has to lead to practical outcomes for businesses across the country. It is also great news that government has stepped back from the anti-growth idea of ending temp-to-perm fees.

“Many of our members and their clients will find it difficult to reconcile that these announcements are unequivocally pro-business and pro-worker if the detailed regulations to come don’t consider the costs to business from overly complex bureaucracy, and a lack of choice on how to employ agency workers who already have employment protections. The task at hand is to protect a temporary workforce roughly equivalent to the population of Birmingham and not undermine confidence amongst hirers of permanent staff. This poses a serious economic risk, at a time when building confidence in our economy is more important than ever – keeping people employed, supporting businesses, and strengthening the resilience of the labour market. We want the Bill to be a success, but for that to be the case, government will have to show it is listening to businesses and well as Trade Unions.” 

On the application of zero hours contracts measures to agency workers, Neil Carberry said:

“Agency workers are different to directly employed workers and have their own more stringent regulatory regime already. If government is serious about the longer-term interest of workers, growth, and competitiveness, it needs to change tack. We are worried that the current approach will drive serious non-compliance and false self-employment, at workers’ cost.”

On the announcement on umbrella companies, Neil Carberry said:

“Regulating the umbrella market closes a loophole in addressing non-compliance and is welcome. Recruiters have long called for regulations that ensure a level playing field. Like all aspects of the government’s changes, proper enforcement will be key to protecting both businesses and workers. The new Fair Work Agency needs to be well equipped financially to deal with this important additional bit of scrutiny.”

On the proposals to strengthen Statutory Sick Pay, Neil Carberry said:

“The expanding scope of SSP in principle is positive for many employees, and employers who want to retain staff by looking after them. But the proposals in the Bill will most likely place the burden of increased costs on agencies, not end hirers, given their ongoing struggles to reclaim SSP from client businesses. We urge the government to set SSP at a level that helps employers retain staff, rather than being forced into capability-based dismissals.”

Notes to editors

Increase in number of temps on assignment amid tough year of trading in 2023, finds major recruitment industry research, November 2024. The report estimates that on any given day in 2023, 1,058,300 temporary or contract workers were on assignment in the UK, up from 976,400 the previous year – an increase of 8.4%.

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Find out more about the Recruitment & Employment Confederation at www.rec.uk.com.