With the advent of a labour government there will be many changes that impact businesses in franchising. Of the most prevalent of those changes will be employment reforms. Our employment Partner has commented on these changes in a recent article by People Management which is available here. Clive describes these as the most radical changes to unfair dismissal laws in 50 years.
“Labour’s plans for day 1 unfair dismissal rights form part of its wider commitment to ‘Securonomics’ a range of measures designed to reduce insecurity for workers. The Government believe allowing employees to claim unfair dismissal from the start of employment will have the additional benefit of creating greater labour mobility in a tight market (by removing the insecurities associated with changing jobs).
The limited detail available suggests that probationary periods and procedures will assume much greater importance. At present, it is not uncommon for employees to be dismissed almost 2 years into the working relationship, with limited repercussions. New hires will, in future, have the ability to claim unfair dismissal when hired. This is a profound shift in employment law, increasing the significance of each decision to hire.
It seems employers will be expected to bring a new rigour and consistency to the concept of the probationary period, in order to show a fair reason for dismissal from the outset. Precisely what this will need to look like should become clear in the Autumn. It is likely to involve the active management of clear and consistent probationary policies to assess employee performance throughout any probationary period.
Changes are likely to be needed to employment contracts and recruitment practices. Training will be required for managers on the implications of assessing new hires promptly and documenting performance consistently. It would not be surprising if the number of employment tribunals increases as a result.
Updates – Immigration law changes since Labour came to power
Given Labour’s victory in the general election, an important question on employers’ minds is what changes they can expect to be made by the new Labour Government in 2024.
While firm plans are yet to be laid out, the new Government have made announcements to maintain a clear commitment to reducing net migration since the election results. This includes a written statement made by Yvette Cooper on 30 July 2024, that provides some insight into the Government’s intentions towards UK immigration.
This includes a clear focus on linking immigration with skills policy with the intention to upskill UK residents to fill shortages in the labour market. Following this being set out in Labour’s manifesto, a second bill was announced in the King’s speech that will establish “Skills England”, a partnership that will work with various bodies, including the Migration Advisory Committee (MAC), to build and maintain an ongoing assessment of the UK’s skill needs. Similarly, the Government intends to strengthen the MAC so it can highlight key sectors where there is an “over-reliance” on international recruitment (such as through forecasting), while creating the Industrial Strategy Council to focus on key sectors to take advantage of new opportunities to provide growth. Overall, this shows an intention to boost the skills of the UK’s workforce, thereby reducing reliance on workers from overseas, while also identifying sector skills gaps and plans.
As a first step, the Home Office is commissioning the MAC to review the reliance of key sections on international recruitment, such as IT and Engineering. As pointed out in the recent Parliamentary statements, such areas previously were included on the Shortage Occupation List, which was replaced with the Immigration Salary List by the Conservative Government earlier this year.
Additionally, in Labour’s manifesto, they stated they would reform the points-based immigration system, with appropriate restrictions on visas. Although the information on what this will mean (other than the above) is still quite limited, the Government has recently confirmed it supports and will continue to implement many of the recent changes already introduced by the Conservative Government. The changes they intend to maintain are the restrictions on overseas students and care workers bringing dependants to the UK, requiring all care providers sponsoring migrants to register with the Care Quality Commission, the increase in the Skilled Worker salary (to £38,700) and the removal of the 20% going rate discount that was present under the Shortage Occupation List. This may come as some disappointment to businesses who have traditionally relied on employing those with dependant visas, or whose pay does not meet the going rates without the previous 20% reduction. However, it does at least provide some certainty as to what to expect in the immediate future.
The one policy the Home Office has stated it may change is the planned increase in the financial requirement for family visas. For many people, this was increased to £29,000 earlier this year. The Conservative Government had stated its intentions to increase this again to £38,700 by early 2025. Instead of committing to this increase, the Labour Government have announced they will commission the MAC to review these financial requirements and there will be no increases until this review is complete. While family visas may not be direct concern to businesses, any increase in the salary requirements are likely to mean that some individuals who would have been granted a family visa under the old rules, would not do so under the new rules, potentially decreasing the available workforce.
The landscape of immigration law will change with the new Government and the recent statement provides some clarity on what employers could expect in the immediate future. Labour’s plans to reduce net migration may continue the trend of making it more difficult for employers to recruit workers from overseas and to fill roles within their businesses. How far the policies to upskill the domestic workforce will go to address this is yet to be seen and comes at a time when a lot of employers will be feeling the impact of policies recently introduced by the Conservative Government. For now, employers should continue to remain vigilant on any immigration updates which might affect their business.
