House of Lords vote in favour of Tory-backed alternative to ‘day-one’ employment rights
The House of Lords has voted in favour of a Conservative-led amendment to ‘day-one’ rights provisions in the final reporting stage of the Employment Rights Bill.
Labour have promised to hand workers with a glut of new rights from day one, including reducing the qualifying period for unfair dismissal from the current two-year threshold to the first day of employment.
However, calls from businesses and lawyers warned of the pressure this change would put on employers and an already strained Employment Tribunal due to a jump in lawsuits from staff.
Figures released last month showed that the Tribunal’s open caseloads increased by 32 per cent from January to March 2024/25 compared to the same quarter the previous year.
Lord Sharpe proposed an amendment to reduce the length of the qualifying period for unfair dismissal to six months rather than from day one.
Speaking at the debate on Wednesday, Tory peer noted that while the “government’s intention to protect workers is commendable”, the approach in the Bill “is confused and counterproductive”.
“What the Government have failed to grasp is that when businesses are given the flexibility to manage their workforce pragmatically, that is precisely when they are more likely to take on new staff,” he told the House.
“Hiring is always a risk. By heightening that risk and making it more difficult to manage, this bill creates disincentives to hire, particularly at the margins of the labour market, where the stakes are highest.”
He argued that his amendment on six months rather than day one offered “a better path”.
Amendment 49 passed 304 to 160 at the vote on Wednesday, with support from Conservative, Liberal Democrat, and crossbench members.
Dan Chapman, employment partner at Leathes Prior Solicitors, said this was a “very important vote from the House of Lords”.
“The proposal put forward by the Lords is a common-sense one, that I know a significant proportion of the employment lawyer community certainly support,” he added.
As with the normal process, the amendments from the House of Lords will be sent back to the House of Commons for consideration.
Chapman highlighted: “The government’s commitment to day one rights is at the core of their manifesto commitment, and ordinarily this means that the House of Lords would as a matter of convention not vote it down.”
“However, the Lords did try and argue last night that their amendment remains within the spirit of the manifesto, and in fact it could be said delivers more effective rights to workers far sooner than the Government’s day one rights would, in which case it will be interesting to see if the Lords will back down or not,” he added.