Emma McGrath is a professional support solicitor at Citation
The Labour government hasn’t wasted any time in taking action on its manifesto pledge to “make work pay”. It has promised to introduce the Employment Rights Bill to parliament within its first 100 days, so before mid-October 2024, but it will take longer for the changes to become law.
This doesn’t mean construction businesses have time to wait. The bill is set to include some big changes for employers in the construction sector. Firms need to be proactive to stay on the right side of the rules and minimise the impact on their operations.
“Firms need to be proactive to minimise the impact on their operations”
Many of the changes will require adjustments to employee management, so it is essential to assess what’s in place now and understand the processes involved in updating it. The first step, however, is to know the planned changes and identify the ones that will have an impact on your operations.
Day-one employment rights
One of the biggest changes will be the removal of the two-year qualifying period for an unfair dismissal claim, making it a day-one right for all employees. While this may cause concern in an industry where work is often short term and turnover can be high, firms that prepare should be able to take it in their stride.
Businesses will still be able to use probationary periods, but they’ll need to implement a fair and clear process and have a fair reason to dismiss. More details will emerge, but firms should start reviewing their current probationary periods, both in contract and in how they operate within the induction process.
In construction, there can be many reasons why things might not work out with a new hire – workers come with hugely different skill levels and no two sites are the same. The new rules mean more emphasis needs to be placed on effective recruitment and good induction programmes, including the right training, checking in regularly on performance, and having the appropriate paperwork in place at every stage.
A new status of worker
The government is proposing merging the categories of employee and worker into a single status of ‘worker’ with a clearer distinction from the genuinely self-employed. It will carry out a full consultation on this, as it is a big change. The new categories are intended to remove grey areas and provide protections for workers against bogus self-employment. Employment status will be dictated by the law and the reality of the relationship, rather than what is stated by the organisation/workers.
Zero-hours contracts
The government is also looking to ban zero-hours contracts and introduce a right to a regular hours contract (based on a 12-week reference period).
It also wants to introduce a requirement for reasonable notice of a shift change and compensation for short-notice changes, protection that employees currently don’t have.
This will have a big impact on construction, particularly given that flexible work is common and project progress unpredictable. Businesses should begin implementing the work needed to inform employees of shift changes in good time.
Prepare, prepare, prepare
These are just three of the changes on the horizon for the industry, but it is clear their impact will be significant. The sector will undoubtedly have questions, and we’ll get more answers as legislation progresses. But the more work that can be done upfront, the easier it will be when the changes take effect. Employers in the sector shouldn’t be scared, but they should be prepared.
