In a bid to reshape the landscape of employment in the UK, the Labour Party has put forward several ambitious proposals in their latest manifesto. These proposals aim to improve worker rights, enhance job security, and ensure fair treatment across various sectors. Below, we break down the key proposals, their potential impacts, and practical steps businesses can take to prepare.

What it is: This proposal grants workers, including agency workers, the right to request predictable working hours. Employers can object only on specific grounds such as increased costs or impact on customer demand. There is already a right to request a predictable working pattern under the Workers (Predictable Terms and Conditions) Act 2023. It is likely that the Labour government will look to strengthen the rights under this law.

Potential Impact: Businesses will need to enhance administrative processes to accommodate requests and resolve disputes regarding reasonable adjustments.

Practical Steps:
- Provide comprehensive education on the new rights to all stakeholders.
- Develop and implement clear protocols for information exchange and objection procedures.
- Evaluate and upgrade infrastructure to effectively manage negotiations.

What it is: Labour plans to increase HMRC funding and staffing to focus on tax compliance, particularly targeting structures operating as umbrella companies and large businesses. For a number of years now, umbrella companies have been on HMRC's radar for operating aggressive schemes to reduce tax liabilities and the Conservative government had planned to take direct enforcement action for some time. Outside of aggressive schemes, issues include non-compliance with holiday pay legislation and minimum wage legislation. It is likely that umbrella companies will come under the existing enforcement regime for employment agencies and legislation may include tax liability transfer provisions - a common feature in many European countries.

Potential Impact: Businesses with intricate labour supply chains should prepare for enhanced scrutiny and potential tax disputes.

Practical Steps:
- Regularly review and update compliance procedures to align with new regulations.
- Implement rigorous due diligence processes for evaluating suppliers.
- Consult with legal advisers to understand potential liabilities and risks.

What it is: Labour proposes day one rights for all workers, including sick pay, parental rights, and protection from unfair dismissal. This is inherently linked to point 4 below - the creation of a single status of worker. At the moment, only employees receive rights such as protection from unfair dismissal and even then it is only after having worked continuously for the same employer for two years. There are several practical considerations for this policy such as how employers will manage probationary periods for new employees.

Potential Impact: Employers will need to adjust contracts and prepare for a potential rise in employment tribunal claims.

Practical Steps:
- Adjust contract terms to incorporate probationary periods.
- Develop equitable processes for managing performance-related issues.
- Monitor consultation outcomes to guide actions on unfair dismissal protections.

What it is: Labour proposes merging employee and worker status into a single category, with a separate category for the self-employed. Currently, there are two classes of worker in the UK - employees and workers. Employees have more rights and protections such as the right to receive a redundancy payment. The removal of the distinction would constitute the biggest enlargement of worker rights in a century.

Potential Impact: Businesses utilizing workers may need to consider the cost and practical implications of having all workers classed as employees.

Practical Steps:
- Stay updated on consultation developments and forthcoming legislative changes.

What it is: Labour intends to ban "exploitative" zero-hour contracts. The Conservative government took some steps to regulate zero-hours contracts by ensuring that any clause purporting to stop the worker from working elsewhere would be deemed unlawful. It is not clear at the moment how Labour intends to define "exploitative" and there is pressure from businesses and indeed some workers to ensure that the law does not go to far and reduce flexibility.

Potential Impact: Businesses that rely heavily on zero-hour contracts may need to find alternative staffing solutions.

Practical Steps:
- Monitor developments and assess how your business model might be affected.
- Explore alternative staffing strategies if your business extensively utilizes zero-hour contracts.

What it is: Labour plans to merge the Employment Agencies Standards Inspectorate (EASI), National Minimum Wage team, and Gangmasters and Labour Abuse Authority (GLAA) into a single enforcement body. This has been on the agenda since 2017 when Matthew Taylor concluded his independent review of modern working practices. There is significant cross-over between the work carried out by this teams - for example the GLAA will often investigate national minimum wage issues when conducting inspections of licensed businesses.

Potential Impact: Businesses should expect heightened enforcement activity and broader authority for the new regulator.

Practical Steps:
- Maintain strict compliance with regulations regarding minimum wage, holiday pay, and agency workers.
- Stay informed about the new regulator's powers and enforcement priorities.

Additional Proposals:
- Platform Workers Directive: Adoption of a presumption of employment status for platform workers, similar to the EU directive.
- AI and Algorithmic Decision-Making: Introduction of regulations around transparency and worker protections in AI-powered recruitment processes.
- Self-Employed Workers: Ensuring self-employed individuals receive written contracts and prompt payment.

The Labour Party’s manifesto proposals represent significant changes for the UK employment sector, aiming to enhance worker rights and ensure fair treatment. Businesses must stay informed and prepared to adapt to these changes, ensuring compliance and maintaining a supportive work environment.By understanding these proposals and taking proactive steps, companies can navigate the impending changes smoothly and continue to thrive in a more regulated and fairer employment landscape.