Recently we saw a Pizza Hut franchisee [Glenshire Group] in Scotland publicly come under fire after workers staged a protest over alleged “wage theft” and the implementation of blanket changes to terms and conditions regarding leave and breaks. While the employer disputes the allegations, this incident serves as a timely reminder of how the upcoming Employment Rights Bill (ERB) could impact similar situations moving forward.
The ERB has been hailed as legislation that will significantly change the employment legal framework once it is passed, bringing the most significant changes to workers’ rights in the UK for decades. Key provisions include removing (almost) the qualifying period for protection against unfair dismissal, enhancing rights for flexible working, removing zero hours contracts, restricting the practice of fire and rehire and much more. The ERB is expected to come into force in stages, with some provisions potentially taking effect later this year.
Of note for those in the same position as Pizza Hut is that the ERB significantly restricts employers’ ability to use the practice of “fire and rehire”. This practice involves dismissing employees and then offering them their jobs back under new, often less favourable terms. The ERB aims to restrict this practice to protect workers from unfair dismissals motivated by changes to their employment terms. In particular, it will make it automatically unfair for an employer to dismiss an employee for refusing to agree to a variation of their terms and conditions of employment. An exception to this would be if the employer can demonstrate that they could not reasonably avoid the variation and that it was in response to dire financial difficulties (such that affect the ability to carry on the business).
This means that employers will likely face greater scrutiny and challenge if they attempt to change employment terms unilaterally without proper consultation and reason. Employers should therefore ensure they engage in proper consultation with employees and provide valid reasons for any changes to terms and conditions to avoid legal recourse under the new legal framework.
In addition to these changes, the ERB will also introduce crucial reforms to zero hours contracts, a form of employment that has been widely criticized for its lack of stability and security for workers. Under the new provisions, “exploitative” zero hours contracts will be further phased out, and employers will be restricted from using zero hours contracts unless they can demonstrate a legitimate reason for doing so and comply with new positive obligations regarding their use.
This change aims to provide workers with more predictable hours and job security, addressing the ongoing concerns about the precariousness of zero hours work. Employees who are engaged under such contracts will see increased protections, such as a requirement for employers to provide more clarity on their working hours and a greater degree of control over their schedules. This change could impact several employers, including the likes of Pizza Hut who may employ individuals under a traditional zero hours contract.
With these significant changes on the horizon, it is crucial for employers to stay informed and adapt their practices accordingly.
Employers should take a proactive approach and begin reviewing their current employment provisions and policies to ensure they comply with the upcoming legal framework implemented by the ERB.
