- New Work Foundation analysis shows potential impact of the Employment Rights Bill on millions of UK workers, particularly regarding two key reforms - the introduction of new day one employment rights and zero-hour contract regulation
- Analysis shows that had the reforms been in place in 2023, 1.2 million fewer people would have experienced severe insecurity at work
- The proportion of the UK workforce in secure jobs would have risen sharply by 3.9 million workers to 17.8 million workers
- But the research also highlights that even relatively small extensions to the length of the new statutory probation period - during which workers won't have full access to new rights - could mean over a million fewer people benefit from secure work and, most worryingly, hundreds of thousands could remain stuck in severely insecure work
- As the Bill heads for Royal Assent, the Work Foundation calls for the Government to reject House of Lords amendments and hold firm on core purpose of key reforms.
A new study analysing the potential impact of the Employment Rights Bill indicates that millions of workers could benefit from better job security, but only if the Government stands firm and delivers on its promise of key reforms.
New analysis from the Work Foundation at Lancaster University provides insights as to the potential impact of two key reforms in the Bill - the introduction of new day one unfair dismissal rights and the ban of 'exploitative' zero-hour contracts - on levels of secure, moderately insecure and severely insecure work. It does so by using the UK Insecure Work Index to assess how these key reforms could have changed levels of insecure work in 2023 had they been in place.
Researchers find that the specific details of a new statutory probation period to be introduced as part of the Bill are likely to be particularly crucial. 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.
However, if a 12-month statutory probation period was applied instead, 6.1 million workers would have remained in severely insecure work, with only 700,000 experiencing more secure work. It could also have meant 1.6 million fewer workers benefitting from the most secure category of work than under a six-month probationary period.
Ben Harrison, Director of the Work Foundation at Lancaster University, 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 also reveals that 92.5% of zero-hour contract workers would have benefitted from the new right to guaranteed hours had it been in place in 2023. This equates to around one million people, with 7.5% missing out as they had worked for their employer for less than the three-month qualifying period. Researchers note that while this new right will significantly reduce the amount of time all zero-hour contract workers face this kind of insecurity for, it will not address the other kinds of insecurity that zero-hour contract workers often also face - such as low pay and underemployment.
Overall, the analysis finds that there would have been a significant improvement in job quality had these two key reforms been in place in 2023. The research found:
- Most notably, the proportion of the UK workforce in secure jobs would have risen sharply from 44.1% (13.9 million workers) to 56.7% (17.8 million workers)
- The proportion of workers in moderately insecure work would have dropped from 34.6% to 25.6%, falling by 2.9 million
- The number of people in severely insecure work would have fallen by 1.2 million, from 6.8 million (21.4%) to 5.6 million (17.7%).
In addition, researchers say those facing disadvantage stand to gain most from the added security of these two key Employment Rights Bill reforms:
- The proportion of young workers aged 16-24 experiencing severely insecure work in 2023 would have fallen by 8.3 percentage points, down to 38.3%;
- The proportion of Black and Asian workers experiencing severely insecure work in 2023 would have fallen by 4.6 and 4.5 percentage points respectively;
- Women and disabled workers could see reductions in severely insecure work by 4.8 and 4.7 percentage points respectively.
Ben Harrison continues, "The Employment Rights Bill has the potential to be transformative for some of the most vulnerable workers in our society - but only if ministers hold firm during the drafting of secondary legislation and new codes of practice over the next two years.
"This could be crucial to wider Government ambitions to support more people into sustained employment. Job insecurity can exacerbate underlying health conditions and lead to people bouncing in and out of employment, or leaving the labour market altogether - which is bad for workers, businesses and the economy."
Among its recommendations, the Work Foundation calls for the Government to:
- Reject any proposed amendments that seek to dilute the new protections in the Bill, and guarantee the core purpose of key reforms are not diluted in the drafting of secondary legislation;
- Ensure the implementation of reforms minimises the risk of enabling loopholes that allow employers to maintain precarious employment practices;
- Ensure robust and representative stakeholder engagement that ensures all voices are heard, while providing clarity and support to employers to assist with the transition to new regulations;
- Ensure enforcement of new regulations is properly resourced and effectively administered; and,
- Establish a national Secure Work Commission to measure the impact of the Bill's reforms on both workers and employers and recommend future reforms.
Responding to the new study, TUC General Secretary Paul Nowak commented: "This Bill can be a game-changer for millions stuck in vulnerable and insecure employment. It's vital that it is delivered in full.
"Giving workers proper rights from day one and clamping down on exploitative practices like zero-hours contracts will bring Britain closer to the standards working people already enjoy in other countries.
"These common-sense reforms are incredibly popular with the public and will give people the security and respect they deserve at work. They will also stop decent employers from being undercut by the bad.
"Let's get this over the line and make work fairer for everyone."
Responding to the analysis on young people and women, Claire Reindorp (CEO, Young Women's Trust) said: "Young women are disproportionately likely to be in insecure work. The reforms in the Employment Rights Bill have huge potential to transform their lives - job security means knowing how much money you have for food that month, not losing out on childcare costs when your shifts are cancelled last minute, and not being afraid your working hours will be cut if you speak up when you're treated unfairly.
"But these measures must be rolled out in full, and without delay so that young women can feel the benefit. And crucially they must be properly promoted - so workers know what they're entitled to - and enforced, so that there is accountability for employers in implementing the measures. If that doesn't happen these rights risk remaining real on paper only."
The new report, entitled 'Increasing job security: The potential impact of employment rights reforms in the UK', is published on the Work Foundation website.
