Workers’ rights: Business secretary defends ‘rushed job’ bill

The business secretary has defended the government’s plan to overhaul workers’ rights after a lobby group branded it a “rushed job, chaotic and poorly planned”.

Labour will today unveil their package of employment reforms – in a bid to deliver on their manifesto commitment to shake up workplace law within their first 100 days in power.

Jonathan Reynolds told BBC Radio Four’s Today programme the bill would “be a significant change tackling insecurity” and “level the playing field towards the best employers”.

He said: “We always said, and we always have done, that we’d work very closely with businesses and unions to make sure these changes are fair and proportionate, and the probationary periods are a part of that.”

Businesses will be consulted by the government on a move to make probation periods a statutory part of employment law, which would allow for lighter touch dismissal during the initial trial period, while giving workers day one rights against illegitimate discharge.

But after details of the Make Work Pay bill emerged yesterday, it was met with criticism from some business lobby groups, who warned it risked threatening economic growth.

Tina McKenzie, policy chair at the Federation of Small Businesses (FSB), said: “This legislation is a rushed job, clumsy, chaotic and poorly planned – dropping 28 new measures onto small business employers all at once leaves them scrambling to make sense of it all. 

“Beyond warm words, it lacks any real pro-growth element and will increase economic inactivity, seriously jeopardising the government’s own 80 per cent employment target.”

McKenzie added: “There are already 65,000 fewer payroll jobs since Labour took power, and the new government is sending out a troubling signal to businesses and investors.”

She described plans to protect workers against unfair dismissal from day one in a job as “add[ing] to the risks associated with hiring people” and said it could deter small firms from expanding, which she said was “bad for jobs, and a barrier to growth and investment”. 

McKenzie said: “Added employment costs the proposed legislation will inevitably bring will also jeopardise job creation, which will in turn be a brake on growth and investment.”

She urged the Chancellor Rachel Reeves to add “a pro-business, pro-employment element” to the bill in the upcoming Budget on 30 October, including the reintroduction of the small business rebate for statutory sick pay (SSP).

John Dickie, chief executive of BusinessLDN, added that while “good businesses already have good working standards”, the government had the “right starting point” with its “commitment to consult business on the draft bill”.

Kate Nicholls, chief executive of UKHospitality, said the “changes were not without cost” and ministers should “take the time to get the details right through close consultation”.

“Rushing to introduce measures too quickly would be the wrong thing to do and would increase the chances of inflicting damage to sectors like hospitality,” she added.

Unite union leader Sharon Graham broadly welcomed the bill, but argued that it “still ties itself up in knots trying to avoid what was promised” after Labour aimed to keep both firms and business lobby groups and trade unionists on side.

“Failure to end fire and rehire and zero hours contracts once and for all will leave more holes than Swiss cheese that hostile employers will use,” Graham added.