Following reports about potential changes to the rules on working time, the business secretary has confirmed that a planned government consultation on post-Brexit workers' rights will no longer go ahead.

We may, however, still see some changes to workers' rights if the Employment Bill, announced in December 2019, is brought forward.

What happened to the planned consultation on post-Brexit workers' rights?

On 19 January 2021 the business secretary Kwasi Kwarteng indicated that his department was going to carry out a consultation with business leaders on the working time directive and other EU rules and regulations. This followed earlier press reports of planned changes to the rules on working time, in particular removing the maximum 48-hour working week; reviewing the rules on rest breaks; not requiring overtime to be included in holiday pay calculations; and removing the requirement to record information about working hours. Other areas which might have been reviewed include TUPE consultation and post-transfer harmonisation; agency workers' rights; collective redundancy consultation; and discrimination awards.

MPs then debated the future of EU-derived workers’ rights in an Opposition Debate on 25 January 2021, during which Kwarteng stated that there is "no government plan to reduce workers' rights".

On 27 January Kwarteng confirmed that the planned consultation on post-Brexit workers' rights was no longer happening.

What does the UK-EU Trade Agreement say?

If the government was to review EU-derived workers' rights in the future, it would be bound by the terms of the UK-EU Trade and Cooperation Agreement. The UK has agreed that it will not reduce the level of protection for workers, or fail to enforce employment rights, below the standards that existed on 31 December 2020 in a manner affecting trade or investment.

If the UK diverges significantly from the EU in relation to employment rights in a way that materially impacts trade or investment, the EU can, within certain constraints and subject to an arbitration process, take 'rebalancing' measures such as imposing tariffs. Major changes, for example removing working time or agency worker laws altogether, might affect trade as this would give UK employers a clear competitive advantage.

Employment Bill 2021?

The unions and Labour responded to reports of a planned review of post-Brexit workers' rights with calls to the government to enhance workers' rights by bringing forward the Employment Bill.

Boris Johnson made an upgrade to existing employment law one of his key campaign promises during the 2019 election. When an Employment Bill was announced in December 2019 it included the following proposed changes:

  • Introduce a new single labour market enforcement agency to enforce employment rights with powers over payment of the National Minimum Wage; labour exploitation and modern slavery; holiday pay for vulnerable workers; regulation of employment agencies; regulation of umbrella companies operating in the agency worker market; and licences to supply temporary labour in high risk sectors.
  • Make flexible working the default unless an employer has a good reason not to.
  • Require employers to pass on all tips and service charges to workers and to distribute them fairly and transparently in line with a new statutory code of practice.
  • Introduce a new right for workers without a fixed working pattern to request a more predictable and stable contract after 26 weeks’ service (e.g. a fixed number of hours or fixed working days).
  • Extend the period of redundancy protection from the point an employee notifies their employer of their pregnancy until six months after the end of maternity leave. Protection will similarly be extended for those taking adoption or shared parental leave.
  • Introduce a right to neonatal leave and pay, to support parents of premature or sick babies.
  • Introduce a week's leave for unpaid carers.

Some of these measures were mentioned in the Opposition Debate last week. It seems likely, therefore, that we will see an Employment Bill in 2021 - although exactly what that might include remains to be seen.

Investigation into 'fire and rehire' practices

The Opposition Debate was also used to discuss recent 'fire and rehire' tactics (dismissal and re-engagement) – according to a TUC survey since March 2020 one in 10 workers have been told to reapply for their jobs on worse terms and conditions. ACAS is currently undertaking an independent investigation into employer practices with a report due later this month.