Labour faces setback as Lords boots back workers’ rights Bill
The Employment Rights Bill failed to clear the final hurdle, as the House of Lords ping-ponged it back to MPs for further debate over disputed points, including the controversial granting of ‘day one’ rights.
The highly contested Bill, which was a significant part of Labour’s manifesto, will see a major overhaul in the UK’s employment laws.
It is currently in the final stage of the legislative route; however, the House of Lords is fighting back by sending several key points, including day-one rights, back to the Commons.
In a sitting on Tuesday, the Lords voted 302 to 159 to send their amendments to the zero-hour contract proposals back to the Commons, along with their amendments on day one unfair dismissal rights (301 to 153), and the Lords rejected the proposed lower thresholds required for industrial action by trade unions by 267 to 153.
Speaking to the House, crossbencher Lord Vaux stated: “If the government are not prepared to listen…the only conclusion we can reach is that the government intend, knowingly and deliberately, to damage the life chances of young and vulnerable people.”
CityAM has an explainer on everything that happened with the Bill since its inception.
Just before the government went on Summer recess, the House of Lords already voted in favour of a Conservative-led amendment to bring ‘day-one’ rights provisions up to six months.
Labour increasingly isolated
The current law stands at two years’ service, but many, including the left-wing Resolution Foundation, believe that bringing this down to ‘day one’ of employment is too severe, and that six months is a better solution.
Some lawyers have argued that accepting a six-month qualifying period allows the government to keep its manifesto promise but also provide some reassurance to the business community. A government analysis last year revealed that the measures from its Bill, as it stood, would trigger around £5bn in additional costs for British businesses.
Dan Pollard, partner at Charles Russell Speechlys, suggested: “The solution here is staring the Government in the face. Why not give employees day one rights but allow employers to include a probationary period for up to 6 months?”
“This reflects what many employers do in practice already. It also protects those employees who are hired from secure employment and allows them day-one rights if they do not agree to probation. This is consistent with the Labour Manifesto commitment and would likely strike a sensible compromise,” he added.
This comes after a left-leaning economics think tank, the Resolution Foundation, called for a major change to be made to the Bill this week, with a focus on ‘day one’ rights, as it warned the government risked “lurching from one extreme to the other” on workers’ rights.
Dan Chapman, partner at Leathes Prior Solicitors, tells CityAM, “The extent of the government defeat at this late stage of the parliamentary process, for a flagship manifesto-driven Bill, is significant.”
“The government now have a huge decision to make. Do they rely on political convention and play ping pong with the Lords, but in doing so risk further delay and embarrassment? Or do they seek to make compromises?”
During a ‘ping-pong’ stage, a Bill can be sent back and forth between the House of Commons and the House of Lords until both chambers agree on the exact wording of the legislation.
Labour’s new business secretary, Peter Kyle, has been adamant that the Bill would be passed in full without changes by the end of the year; however, the idea of it having Royal Assent by November is starting to look like it’ll be pushed back and forward until an agreement can be found.