Since taking control, Labour has promised sweeping changes that will affect businesses across the UK. Their manifesto, ‘Change’, outlines an ambitious agenda to introduce a host of new employment laws within the first 100 days and throughout their term in office.
For SME business owners, understanding the key points of Labour’s ‘Plan to Make Work Pay: Delivering a New Deal for Working People’ is crucial. Here’s what you can expect:
Deliver a genuine living wage
Labour plans to raise the national minimum wage to better reflect the cost of living and eliminate discriminatory age bands, ensuring every adult worker benefits. While these measures enhance financial security for workers, they will inevitably increase payroll costs for businesses.
Support working people
Labour intends to update trade union legislation, removing unnecessary restrictions on trade union activity and ensuring industrial relations are based on good faith negotiation and bargaining.
Ban exploitative zero-hour contracts
The new government plans to overhaul employment status definitions and eliminate exploitative zero-hour contracts. This change will likely provide more stability for workers but could limit flexibility for employers.
End fire and rehire practices
Employees will gain protection against unfair dismissal from their first day on the job, and the window to bring claims will be extended. This policy emphasises job security but will require businesses to be more diligent in their employment practices.
Make work secure
Labour aims to ensure workers can benefit from flexible working arrangements. This includes flexi-time contracts and hours that better accommodate school terms. Flexible working will become the default from day one, except where it is not reasonably feasible.
Enhancing export guidance
To help small businesses expand their global reach, Labour will improve guidance and remove barriers to exporting. This initiative will open new markets and opportunities, fostering growth and competitiveness.
Reforming the British Business Bank
Labour intends to reform the British Business Bank, giving it a stronger mandate to support regional growth. This reform will make it easier for SMEs to access capital.
Looking ahead
While not all proposed measures will be implemented immediately, and some may be subject to consultation or revision, early preparation will help mitigate the impact of these changes and ensure compliance. Contracts, policies, and handbooks will all require rewriting to reflect the upcoming changes, particularly to take into account the changes to day-one rights.
