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What is Labour’s Employment Rights Bill – and how has it changed?

2025-11-28 11:48
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What is Labour’s Employment Rights Bill – and how has it changed?

Labour has been accused of breaching a manifesto commitment over the change

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What is Labour’s Employment Rights Bill – and how has it changed?

Labour has been accused of breaching a manifesto commitment over the change

Albert TothFriday 28 November 2025 11:48 GMTCommentsVideo Player PlaceholderCloseLabour U-turn on workers' rights reform was pragmatic decision, says PhillipsonView from Westminster

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The government has come under fire for rowing back on a manifesto commitment as it changes a key element of its landmark workers’ bill.

Currently in its final stages, Labour said its Employment Rights Bill would “strengthen the collective voice of workers” as part of its ‘Plan to Make Work Pay’ launched ahead of the general election last year.

The raft of major changes – thought to be spearheaded by former deputy prime minister Angela Rayner – included the proposal to reduce the “qualifying period” for workers to make an unfair dismissal claim from 24 months to the first day in a new job.

This has now been cut down to six months instead, in light of a series of “constructive conversations between trade unions and business representatives”, a government update said. It added that the change was necessary to ensure the bill’s passage through parliament.

Business secretary Peter Kyle denied that the move broke a manifesto promiseopen image in galleryBusiness secretary Peter Kyle denied that the move broke a manifesto promise (PA Wire)

While Labour’s pre-election manifesto said it would “consult fully with businesses, workers, and civil society on how to put our plans into practice before legislation is passed”, it also pledged protection from unfair dismissal from day one.

Business secretary Peter Kyle insisted that the concession is not a breach of Labour’s manifesto, saying that unions and employers have “gone through the difficult process of working together to find a compromise,” adding: “It’s not my job to stand in the way of that compromise.”

But Labour MP for Middlesbrough and Thornaby East, Andy McDonald, branded the move a “complete betrayal” and vowed to push for its reversal.

He said: “We cannot support that halfway measure,” adding: “This is a wrong-headed move and I will campaign to have this concession reversed.”

Here is an overview of how the bill will change the workplace for employees across the UK.

New day one rights

The Employment Rights Bill is now expected to make only parental leave and sick pay available from day one of the job for all workers.

However, protection from unfair dismissal will now only be secured after six months, rather than on day one as was the case when the bill was introduced.

‘Exploitative’ zero-hour contracts banned

New measures will ban what Labour terms “exploitative” zero-hour contracts, to make sure workers get a contract that reflects the number of hours they work. The rules will also require workers to be compensated for any changes in shifts that are made without reasonable notice.

New measures would ban what Labour terms ‘exploitative’ zero-hour contractsopen image in galleryNew measures would ban what Labour terms ‘exploitative’ zero-hour contracts (Getty/iStock)

Fire and rehire outlawed

Controversial ‘fire and rehire’ practices are when an employer fires one or several employees to offer them a new contract under different terms – generally, less favourable ones.

The issue gained attention in 2021 when Tesco proposed firing some of its distribution staff and rehiring them on lower pay. In 2024, the supermarket chain lost a Supreme Court battle with the Usdaw union over the row. Tesco accepted the judgement, which it said affected “a very small number of colleagues”.

Labour’s plan stated: “Labour will end the scourges of ‘fire and rehire’ and ‘fire and replace’ that leave working people at the mercy of bullying threats. We will reform the law to provide effective remedies against abuse and replace the inadequate statutory code brought in by the government with a strengthened code of practice.”

Strengthen union rights

The government says the bill will “modernise trade union legislation” by giving trade unions “greater freedom to organise, represent and negotiate on behalf of their workers.”

Two of the key ways it will do this is through repealing the Strikes (Minimum Service Levels) Act 2023, and most of the Trade Union Act 2016.

The first bill, introduced by the Conservatives, gave employers in certain sectors such as health and transport the ability to issue “work notices” during industrial action to ensure a certain number of people had to remain at work. It was criticised as undermining the right to effectively strike.

In repealing the second bill, Labour will increase the mandate for industrial action – the amount of time after the ballot that the action can continue – from six months to 12. It will also reduce the notice that the union must give employers from 14 days to ten.

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