IoD press release Proposed employment law reforms represent substantial shift in employee relations

The Institute of Directors has today launched a new policy paper, ‘Labour’s Plan to Make Work Pay: Insights from employers’.

The paper brings together IoD data and insights across key areas of proposed reform in the Labour Party’s plan, ‘Make Work Pay: Delivering A New Deal for Working People’. It puts forward policy recommendations relating to the new government’s proposals around dismissal and re-engagement, zero hours contracts, employment status, the right to switch off, day one employment rights, equity, diversity, and inclusion reporting, and Statutory Sick Pay (SSP).

Key measures proposed by the IoD include:

  • Strengthen the upcoming statutory code on dismissal and re-engagement to ensure that the practice  is only used in circumstances where an organisation faces a serious and credible risk to its viability.
  • Ensure that employers remain able to use zero hours contracts where they cannot guarantee a minimum number of hours of work due to fluctuating demand.
  • Support employers and employees to develop bespoke workplace policies on the right to switch off.
  • Commit to retaining probationary periods to reduce the risk to employers, particularly SMEs, of taking on new staff.
  • Introduce a rebate scheme, targeted at SMEs, to mitigate the impact of any SSP reform on the businesses least likely to be able to shoulder the additional cost.
  • Focus on measures to prevent miscategorisation of employees under the existing employment status framework, rather than on reducing flexibility by merging employee and worker statuses.

Commenting on the launch of the paper, Alexandra Hall-Chen, Principal Policy Advisor for Employment at the Institute of Directors, said:

“Taken at face value, the government’s proposed package of employment law reforms represents a substantial shift in employee relations for the business community.

“Our research shows that there is appetite in the business community for reform, but that the specifics of the policies will be crucial in determining whether they support or stifle economic growth.

“It is therefore essential that changes are designed and implemented in a phased and well-signposted way, in order to avoid overwhelming business and to minimise the risk of unintended consequences.”

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The IoD supports directors and business leaders across the UK and beyond to learn, network and build successful, responsible businesses.
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