The CIPD has welcomed a new UK government following Labour’s landslide general election victory, but has echoed the view from other experts and business groups that Sir Keir Starmer’s relatively ambitious programme of employment-related reforms requires a closer partnership with employers.
Labour’s majority of more than 170 means it should be able to implement its key policies relatively quickly, and a number of bills affecting the people profession are slated to appear within the first 100 days, possibly featuring in a King’s Speech on July 17.
Peter Cheese, CIPD chief executive, said he welcomed the new government, but added: “Labour has said it will put partnership working with employers and trade unions at the heart of its plans to transform the economy. The next 100 days will be a crucial test of that pledge as it starts work implementing a new skills agenda and the New Deal for Working People.
“The New Deal is a complex area so it is crucial the Government engages with employers and the HR profession, who will be at the forefront of any changes to workplace regulations and practices.”
The most headline-grabbing aspect of the New Deal is the proposal to extend employment rights – including unfair dismissal protections, sick pay and parental leave – to all employees from their first day on the job. Cheese said the plans “need to be worked through in genuine partnership with employers and trade unions, through consultation and potential compromise,” calling for a workplace commission which could bring together employers, unions and governments to reach consensus.
But some employment lawyers sounded the alarm about the potential implications of the move. While noting that the new government had said any legislation would not act as a barrier to fair dismissals, Ben Smith, senior associate at GQ Littler, said the changes were “a significant shift in the employment law landscape – and, if implemented, would be something of a shock to many employers.
“Currently, dismissals before two years’ service tend to be more straightforward but under these proposals, employers will much more frequently have to implement a more formal process to dismiss. Employers will likely have to implement time and resource-intensive processes at a scale that is radically different to the current status quo.”
Smith added that when coupled with proposals to double the time limit to bring claims to an employment tribunal to six months, the result could be an even more significant backlog of tribunal cases in a system already struggling with the post-Covid workload.
Other aspects of Labour’s stated post-election agenda will require further clarification. The party has promised to make union recognition easier, including requiring employers to tell staff about the ability to join a union, and has pledged to tackle the thorny issue of employment status by simplifying a regime which has been frequently challenged through tribunal cases.
More broadly, however, there was optimism about the potential for the new government to work with employers to usher in reforms. Cheese said there was an opportunity to make the apprenticeship levy system more effective, adding: “A reformed, more flexible levy can boost apprenticeship provision for young people and make it easier for employers to upskill their existing workforce.”
Meanwhile, Neil Carberry, chief executive of recruiters’ body REC, said it was vital flexible work was properly legislated for and understood by the government. “The labour market has changed over the past few decades – of course workers need to be treated well, but that includes choice and opportunity on how and when they work,” he said. “Workers and businesses across the country understand the goals of Labour’s plan but its implementation must support a growing economy and accept that there is no one best way of working.”
Both REC and the CIPD called for an overarching industrial strategy to underpin employment reforms and give businesses a broader sense of the direction of economic travel, to better assist their workforce planning. “Effective skills and employment policy can help create a thriving economy that benefits individuals and businesses. The CIPD is ready to provide its expertise, and that of our profession, to support the new Government in shaping policies to create better work and better working lives,” added Cheese.