I was very pleased to support the shadow Business team’s amendments at Report Stage on the 11th March 2025, relating to the third party harassment clause in the Employment Rights Bill.
First of all, the Opposition laid an amendment to require the Secretary of State to conduct an impact analysis on Clause 18 and lay the findings before Parliament. The frontbench also laid amendments to exclude hospitality providers and sports venues from the duties imposed by the Clause because of the concern that the Employment Rights Bill will impose a "banter ban" in pubs and force landlords to police pub chat that risks offending employees. The Opposition has heard the concerns of the hospitality sector and has taken action, unfortunately it looks like the Government is not in listening mode.
The Employment Rights Bill is already causing considerable instability, uncertainty, and falling confidence, particularly amongst the 5.5m strong small business community. It will tie businesses up in red tape and means having to deal with a new regulator, the Fair Work Agency, which will have the power to enter any business premises, confiscate documents, levy fines and even creates new criminal offences with prison sentences of up to two years.
The Government claims that it has engaged in extensive consultations with businesses about these reforms, yet many business representatives have spoken out with serious reservations about this Bill. The Federation of Small Businesses has stated that the Bill will “inevitably deter small employers from taking on new people,” describing it as “rushed, clumsy, chaotic, and poorly planned.” Additionally, the Institute of Directors has reported that 57 per cent of its members would be less likely to hire staff, while the Confederation of British Industry has said that 54 per cent of businesses cannot afford the costs associated with this Bill.
The Government’s impact assessment suggests it could cost businesses up to £4.5 billion annually and could increase the number of strikes by 53 per cent. The public will pay the price – not just through uncollected waste, dysfunctional local government, and waves of low-threshold strike action - but also through higher taxes, lower wage growth and higher prices.
The Regulatory Policy Committee, the independent body tasked with scrutinising whether policy decisions are based on accurate fact, has found that eight of the twenty-three impact assessments for the Employment Rights Bill were "not fit for purpose". This raises very serious questions about how much worse for business this Bill might prove to be, especially given the fact that the Bill has already grown from 158 pages to 310 pages with several stages of the Bill left to go.
To be clear, HM Opposition is both pro-business and pro-worker. Whilst in office, the previous Government improved workers’ rights in several areas, including flexible working, parental leave, redundancy protections, ensuring that workers keep the tips left for them by their customers and significant increases to the National Living Wage.
However, this legislation is being rushed through Parliament to meet a misguided promise from the Deputy Prime Minister to unions to introduce this legislation within one hundred days. I urge the Government to withdraw this Bill, consult properly, and work with HM Opposition to ensure that the economy and business, particularly SMEs, are not adversely impacted by these sweeping changes.
