Business & Trade Select Committee: Employment Rights Bill Inquiry

Introduction

Working Families is the UK’s national charity for working parents and carers. Our mission is to remove the barriers that people with caring responsibilities face in the workplace.

We provide free legal advice to parents and carers on their rights at work though our website and rights line. We give employers the tools they need to support their people while creating a flexible, high-performing workforce. And we advocate on behalf of the UK’s 13 million working parents and three million unpaid working carers, influencing policy through campaigns informed by our unique research insights.

This is reflected in our work with employers, both large and small, to support the adoption of family-friendly working practices, as well as through our legal advice service, which assists employees in resolving workplace issues to help them remain in employment.

In addition, our policy and research team has a proven track record of collaborating with governments and MPs to introduce and amend legislation. Recently, this included working with Yasmin Qureshi MP to help shape the Employment Relations (Flexible Working) Act 2023 and collaborating with former MP Stuart McDonald on the Neonatal Care (Leave and Pay) Act 2023.

Our evidence submission draws upon our extensive research, our experience in supporting previous legislation, and the perspectives shared with us by both our employer members and those accessing our legal advice service.

Section One: Whether the Employment Rights Bill will adequately protect workers, improve security at work and raise living standards in every part of the country 

Does the Employment Rights Bill adequately safeguard the workers it seeks to protect?  

While Working Families broadly supports the proposed legislation and believes it strengthens protections for the workers it seeks to safeguard, its effectiveness is harder to quantify. This is explored further in a subsequent section addressing the weaknesses and potential loopholes within the Bill.

A positive development is the recent amendment introduced by Minister Justin Madders, which extends the timeframe for employees to bring claims to a tribunal from three months to six months. However, concerns remain regarding flexible working requests. Specifically, the ambiguity around the definition of ‘reasonable’ when employers and employees negotiate the rejection or acceptance of such requests poses a challenge. This uncertainty could undermine the intention of making flexible working the default.

Are there weaknesses or loopholes in the Bill that could be exploited or have unintended consequences?  

While the Bill introduces a broad range of important protections, including 'day 1 rights' such as entitlement to Paternity Leave, Unpaid Parental Leave, and protection from Unfair Dismissal, as well as enhanced rights for pregnant workers, there remain areas where further work is needed. In particular, it is vital to strengthen employees' confidence in accessing and utilising these new rights.

Organisations such as Working Families, which specialise in advocating for and clarifying new legal changes, play a crucial role in ensuring that employees can understand and exercise their rights effectively. For instance, we worked with the previous government to promote awareness of changes to flexible working legislation. Support for similar initiatives will be essential to empower employees, particularly those on lower incomes, who often face greater barriers in accessing justice due to limited time and resources. Without this additional support, the Bill’s intended protections may not be fully realised by those who need them most.

Are there areas of employment law not covered by the Bill that weaken workers’ protections?  

While it is commendable that the government has committed to reviewing parental leave and pay, our research indicates that the current statutory pay provisions are inadequate for parents. Polling we have conducted[1], as well as insights from the Working Families Benchmark, demonstrate that leading employers on our benchmark provide significantly more generous offerings: on average, 18 weeks of fully paid maternity leave as a day one right, 5 weeks of fully paid paternity leave, and 14 weeks of fully paid shared parental leave. [2] This generosity correlates with a notably higher uptake of these policies by employees.

It would therefore be beneficial for the legislation to include a more comprehensive consultation on parental leave and pay, particularly to evaluate the effectiveness of shared parental leave.

In addition, we support the analysis provided by Bliss regarding a critical gap in the legislation: neonatal leave and pay is not being made a day one right but instead retains the current 26-week qualifying period. This undermines its accessibility, particularly for those most in need. We recommend an amendment to the legislation to address this gap and urge the government to consider how this could be practically implemented.

Can the measures in the Bill be adequately enforced? What are the barriers to setting up a Single Enforcement Body (Fair Work Agency) and how can these challenges be overcome?  

As noted in previous replies, we are pleased to see the proposed amendment extending the timeframe for submitting claims to an employment tribunal from three months to six months. However, the success of enforcement measures will heavily depend on the funding and resources provided to the proposed Single Enforcement Body (SEB).

Analysis of data from our legal advice helpline shows that a third of our clients are living in relative poverty despite being part of working households. If adequate financial support is not made available to such households, they are unlikely to access or feel confident in using the services offered by the SEB. This highlights the importance of ensuring that the SEB is accessible to all, particularly those in precarious financial situations.

It is also critical to clearly define the roles of existing organisations, such as the Equality and Human Rights Commission (EHRC) and ACAS, in relation to the SEB. Without clear delineation, there is a risk of overlap or conflict between these bodies, which could hinder the SEB's ability to function effectively and create confusion for workers seeking support.

Lastly, the perception of robust enforcement and the expectation that breaches will be addressed are central to the success of this legislation. A well-funded SEB will be essential to achieving this and ensuring the effectiveness of the reforms proposed in the Bill.

What impact will the areas covered by the Employment Rights Bill have on small, medium and large businesses?  

Working Families works closely with around 160 employers across various industries, including multinational corporations and SMEs. While we do not speak directly on behalf of these employers, we collect valuable insights into how employment policies impact their businesses through our Working Families Benchmark. Employers who choose to participate in this benchmark are typically those committed to leading the way in employment practices and continuously improving their support for employees.

This year, for example, we found that “100% of Benchmark employers take measures to support their staff’s physical and mental wellbeing, and to prevent burnout and over-working.”[3] This demonstrates that many proactive employers are already prioritising the empowerment and wellbeing of their staff.

While we are not positioned to provide an exhaustive analysis of the potential impact of the Bill on businesses, it is evident that leading employers are already exceeding the requirements proposed in the legislation. As such, this Bill is likely to drive improvements among less proactive employers, raising the baseline for employee support and ensuring more consistent standards across industries.

What impact will these measures have on staff retention, hiring practices, probationary periods and wages?  

Working Families has extensive experience collaborating with the Civil Service and others on the ‘Happy to talk Flexible Working’ tagline[4]. This initiative aims to promote flexible working by encouraging employers and potential employees to discuss flexible arrangements before starting a role. It also seeks to inspire those who need or would benefit from flexible working to apply for jobs in the first place.

In addition, through our employer members and participants in the Working Families Benchmark, we know that flexible working remains a cornerstone of recruitment, retention, and hiring practices. According to the Benchmark, “Strategic plans to support family-friendly working continue to be in place in nearly all Benchmark employers, remaining at 96% of employers.”[5]

We believe that treating flexibility as the default will encourage employers to provide greater access to flexible working for those on the lowest incomes. This, in turn, will enhance retention, career progression opportunities, and wage growth. Initial findings from our forthcoming Working Families Index 2024 show that “8 in 10 parents work flexibly in some way” and that “[t]his year’s index highlights the unmet need for flexible working, with almost three-quarters (73%) of those not working flexibly expressing a wish to. Flex is seen as a practical solution to everyday struggles of family life, chiefly childcare and coping financially. Mothers are more likely to be driven by the need to manage the juggle and keep costs down, underscoring that it is women who shoulder the burden of organising and managing the day-to-day practicalities of caring.”

For these reasons, we are highly supportive of measures around flexible working and their potential positive impact on staff retention, hiring practices, probationary periods, and wages.

 Business and Trade Committee  - Employment Bill Consultation                                                                                    4