More than 1m UK workers to gain more rights under employment bill, says thinktank | Zero-hours contracts

Employers will be forced to offer more secure terms to more than a million workers if the employment bill going through parliament is implemented, according to research by a leading thinktank.

The Work Foundation said analysis of 2023-24 data calculating the impact of a ban on zero-hours contracts and “day one” compensation after unfair dismissal – which are two key elements of the employment rights bill – showed 1.2 million workers would have been protected from “severe insecurity” in the workplace.

Illustrating why the bill has so far underpinned trade union support for the government, the analysis showed there would be a broader improvement for workers in roles already with some protection.

The Work Foundation at Lancaster University said that had the measures been in place in 2023, the number of workers in secure jobs would have risen by 3.9 million to 17.8 million.

Some elements of the bill are due to take effect next April, while bans on zero-hours contracts and the practice used by some employers of firing and rehiring staff on worse terms and conditions, triggering unfair dismal claims, are due to become law in stages over the next two years.

However, unions have accused ministers of planning to dilute many of the protections, including scrapping day one rights in favour of a minimum of six months.

Employer groups have pushed back against the rules and are expected to lobby intensely at the Labour conference this weekend to try to convince Angela Rayner’s successor as deputy leader, David Lammy, and the new business secretary, Peter Kyle, that many provisions should be delayed or weakened to protect the business community.

Rayner, an important architect of the bill, lost her job last month while Jonathan Reynolds, the former business secretary, was reshuffled to become chief whip.

Both had been expected to steer the bill through to becoming legislation and subsequently to implement its many elements via secondary legislation.

Sharon Graham, the head of the Unite union, said recently that commitments of “no ifs, no buts” on the bill were undermined by a loosening of the rules in favour of employers.

A decision to allow councils an opt-out from restrictions preventing the firing and rehiring of workers appeared to show ministers’ willingness to bow to employer’s demands, Graham said.

Under the amendments, councils will gain the ability to sack and rehire workers on worse pay and conditions if they are in financial distress – an opt-out already secured by private-sector organisations.

The bill is due to gain royal assent in the next few weeks, though hundreds of amendments tabled in the House of Lords, mostly to delay or weaken the legislation, remain to be considered.

The Work Foundation said the government should reject the amendments “and hold firm on core purpose of key reforms”.

It said analysis of the UK Insecure Work Index, which is cited by Labour as a measure of the protection offered to workers, showed that a new statutory probation period to be introduced as part of the bill was “likely to be particularly crucial”.

The thinktank said: “Estimates suggest that if day one unfair dismissal rights had been in place in 2023 with a six-month statutory probation period then 1.2 million fewer people would have experienced severe insecurity at work. This could have potentially reduced the total number of people in severely insecure work from 6.8 million to 5.6 million.”

If the two-year statutory probation period had been reduced to one year, 6.1 million workers would have remained in severely insecure work, with only 700,000 experiencing more secure work, it said.

Ben Harrison, the thinktank’s director, said: “Strengthening workers’ rights is a critical step towards delivering better living standards for working people across the UK. And while it is right that the government engages extensively to ensure new measures are workable for workers and employers, ministers must not trade away the benefits of the bill.

“Excessive delays in being able to access new rights risks significantly reducing the number of workers who will benefit from them at any given time. What might be characterised as small details are in reality big choices for ministers, with significant implications for working people.”

The report found that 92.5% of zero-hours contract workers would have benefited from the new right to guaranteed hours had it been in place in 2023. This equates to about 1 million people, with 7.5% missing out as they had worked for their employer for less than the three-month qualifying period.

Claire Reindorp, the chief executive of the Young Women’s Trust, said young women were more likely to be in jobs that offered little security.

“The reforms in the [bill] have huge potential to transform their lives, but these measures must be rolled out in full and without delay so that young women can feel the benefit,” she said.