Criticism of Employment Rights Bill for Lack of Regulatory Review

The government’s regulatory policy committee has criticized the failure to submit the Employment Rights Bill for evaluation by the watchdog prior to its parliamentary introduction.

The independent review body indicated that it has not received an impact assessment (IA) for the bill, which was presented to parliament on October 10, 2024.

Government departments are required to provide an assessment of new legislation to the committee, allowing the regulator to publish an opinion before the bill reaches parliament.

The regulatory policy committee (RPC), composed of independent specialists across various sectors and led by economist Stephen Gibson, was established in 2009 to evaluate the supporting evidence for regulatory and deregulatory initiatives and their implications for businesses.

In their statement, the committee noted: “Given this was a commitment outlined in the manifesto, the Better Regulation Framework permits the Department for Business and Trade to submit an IA for the proposal instead of the usual options assessment.”

The bill, introduced to parliament this week, remains under scrutiny as an IA has yet to reach the RPC.

The 149-page Employment Rights Bill is being promoted by the government as a significant reform in worker’s rights, featuring provisions to eliminate “fire and rehire” practices, guarantee statutory sick pay from day one, establish parental leave, and provide protections against unfair dismissal.

Implementation of most reforms is anticipated to occur in 2026, as the government commits to a series of consultations focused on the finer details over the upcoming year.

After receiving the IA, the RPC stated that it would generate its own opinion promptly, which will subsequently be made public to both parliament and the government.

The absence of regulatory evaluation of the bill raises concerns regarding the government’s assessment of its potential effects on businesses.

The Federation of Small Businesses criticized the proposed changes as “poorly planned, chaotic, and detrimental to job creation.” Conversely, major employers, represented by the CBI, expressed a more positive outlook, praising the government for its willingness to engage with both businesses and labor unions to ensure the successful execution of the reforms.

Business Secretary Jonathan Reynolds confirmed earlier this week that an impact assessment will be presented to parliament alongside the bill.