Bosses expected to ‘Make Work Pay’ in new era of employment rights

The world was in the grip of the Great Depression when Franklin D. Roosevelt became US President in 1933. During his presidency, he enacted a whirlwind of legislative action – known as the ‘New Deal’ – aimed at reviving the flagging economy and restoring the country’s shattered confidence.  

Jumping continents and changing centuries, the UK’s Employment Rights Bill has echoes of Roosevelt’s employee-centric policies, with key measures including strengthened sick pay and parental leave rights.  

The flagship Bill is touted to drive growth, increase job security and improve living standards. But what does this mean for your business, and how should you prepare for the future? And how will a series of last-minute changes influence the final deal?

What are the government’s new measures? 

Employer responsibilities have heightened in recent years, with organisations obliged to provide their workers with greater financial support and wellbeing intervention. And with the Employment Rights Bill, employers can expect to face even higher levels of accountability. 

As shown in the government’s recent roadmap, the Bill will carry forward a range of reforms; from clamping down on zero-hours contracts and fire and rehire tactics, to establishing improved day one rights for millions of workers.  

While not an exhaustive list, some of the key measures to be aware of include: 

• Day one protection from unfair dismissal, while allowing employers to operate probation periods.  

• Day one entitlement to paternity leave and unpaid parental leave, along with a statutory entitlement to bereavement leave. A new amendment takes this further, extending bereavement leave to employees who suffer pregnancy loss before 24 weeks – an important decision that recognises the emotional toll this can have on employees and their families. 

• Ending fire and rehire practices. While the original proposals may be amended to avoid being overly restrictive on employers, the changes will still have a considerable impact on hiring. 

• A crackdown on zero-hours contracts, creating new rights for the one million plus people believed to be working on this basis. 

• Strengthened statutory sick pay, eliminating the lower earnings limit for all workers and cutting out the waiting period before sick pay kicks in. 

• Improved access to flexible working, designed to “help people balance work with family, health, and other responsibilities”. 

• A recent amendment that renders non-disclosure agreements (NDAs) void if they prevent a worker from making a disclosure regarding harassment or discrimination.  

How will employers be impacted? 

The proposed measures have been previously described by the government as “the biggest upgrade to rights at work for a generation”, but workers will have to wait a little longer before benefiting from them – it’s now believed that some of the key reforms won’t take full effect until as late as 2027. 

While disappointing news for workers and trade unions, this delayed action gives organisations a window to consider the reforms’ potential impact on their people polices, and the opportunity to re-examine the rights they currently offer staff. 

For example, employers will want to keep up to date on how the new probationary rules will potentially influence their hiring decisions. Currently, employees must complete a two-year qualifying period before gaining dismissal protection, but the newly suggested nine-month period could make evaluating the right candidate even more critical. 

The crack-down on zero-hours contracts will also raise a number of questions: which workers will fall under the provisions’ scope, and what wider impact this will have on industries that see seasonal spikes in demand, such as retail or hospitality. 

How should employers respond? 

There’s still a degree of uncertainty regarding the expectations and realities surrounding the proposed measures – with last minute changes still being made – yet they should prompt employers to refine their workplace strategies in a market where candidates are increasingly aware of their rights and wellbeing.  

Take the new expectations regarding normalised workplace flexibility, for example. While not expected to come into force until 2027 – and a lack of clarity regarding enforcement – our Working Well Report highlights the wellbeing benefits of flexible working. Notably, 84% of the employees we surveyed say that hybrid working has positively impacted their wellbeing. And with 39% saying they have left a role due to inadequate wellbeing support – and a further 34% having considered it – providing greater flexibility could put employers in a stronger position to attract and retain talent. 

While the anticipated ‘right to switch off’ – a proposed ban on out-of-hours contact that was to coincide with the Bill – has been pulled to reduce compliance pressures on businesses, organisations would still do well to re-think how they approach out-of-hours communication when supporting employee wellbeing. This is especially true given that 91% of employees work outside of contracted hours, which over time, could contribute to workplace burnout.  

Rather than waiting to see what shape the final measures will take, employers should look to stay ahead of the curve by ensuring that their people are put front and centre of business decisions. This might include developing a greater understanding of their workforce wellbeing, gathering data and providing tailored wellbeing measures. 

Make them a deal they can’t refuse 

Whether the Employment Rights Bill carries the same legacy as Roosevelt’s New Deal remains to be seen, and there’s still more detail to be worked through before its staggered enactment. What’s more certain though, is that organisations who make a conscious effort to put their people first, promote inclusive practices, and support workplace wellbeing, will be more likely to find and retain the skills they need to secure future success. 

Looking to solve your talent and recruitment challenges in an evolving world of work? Get in touch with us today. 

And for expert recommendations on supporting employee wellbeing, take a look at our Hays 2025 Working Well Report.