By now, the dust has settled on the election. David Cameron, our Prime Minister elected with a majority, has outlined his government’s intentions and the next five years will see a slew of changes across the board, many of which will have implications for employers.
An expected trend in legislation relating to business is deregulation. The Small Business Enterprise and Employment Act (SBEEA), which has been in the pipeline for a while now and which received Royal assent on 26th March this year, aims to reduce regulations that may stifle the growth of small businesses. Some legislation covered by the SBEEA:
- Fines for unpaid settlements and tribunal awards
- Restrictions on zero hours’ contracts which require exclusivity
- Increased fines for businesses failing to pay their employees minimum wage
- Restrictions on the number of times postponements to employment tribunal hearings can be requested
The Human Rights Act
One of the most controversial areas up for discussion is the proposed replacement of the Human Rights Act with a British Bill of Rights. Some wonder whether this was included in the Conservative manifesto as a sop to be negotiated away during potential coalition negotiations in the case of a hung parliament. Now this is not necessary, it remains to be seen how the proposed changes will be implemented.
There will likely be implications for employers and employees alike under new legislation but, currently, all that can be done is to keep abreast of developments.
Zero Hours’ Contracts
Exclusivity, mentioned previously, is a contested aspect of zero hours contracts: many argue that they pave the way for abuse of employees and prevent them from enjoying stability in their employment. The SBEEA includes an amendment to the Employers Rights Act 1996 – the new Section 27A will void any contractual clauses stating that an employee on a zero hours’ contract preventing employees from working elsewhere, either at all or without express permission.
Unfair dismissal qualifying period of service will remain at two years. It was raised from one to two years by the Conservative – Lib Dem coalition on 6th April 2012.
Minimum wage and living wage
The current minimum wage is £6.50 (21+), £5.13 (18-20), £3.79 (18-), £2.73 (apprentice). This will rise in October to £6.70 (21+), £5.30 (18-20), £3.87 (18-), £3.30 (apprentice).
The Conservative manifesto claims that there will be a minimum wage of £8.00 by the end of the decade, and also supports the ‘living wage’ (this is set at £9.15 an hour in London and £7.85 an hour in the rest of the UK by the Living Wage Foundation). The manifesto’s support of the ‘living wage’ is paired with encouragements for businesses to aim to pay it where possible.
There are also proposals to raise the personal pre-tax allowance to £12,500 per person, meaning that by the end of the decade, people working 38 hours a week on the proposed minimum wage won’t have to pay any income tax. A partnering pledge has been made to increase this allowance in line with minimum wage henceforth to maintain this arrangement.
The Conservatives will most likely attempt to make strike action more difficult to achieve, especially in key services. This will be enforced with a law requiring 40% turnout for people entitled to vote in strike ballots. Accompanying legislation would allow employers to use agency workers to cover for striking employees: a practice that is currently banned.
The impact and exact nature of this legislation remains to be seen, but this primer will be useful in identifying which areas are susceptible to change in the coming years.
This article was syndicated from Business 2 Community: The Election and Employment: A Primer for the Coming Years
More Business & Finance articles from Business 2 Community: