Earlier this week the Queen’s Speech was delivered at the State Opening of Parliament setting out the Conservative government’s legislative agenda. A number of the proposed bills were of course expected (just look back at our Employment Update for April if you do not believe us), but with David Cameron now free to pursue his own legislation without the shackles of a coalition partner, what will be the implications in respect of employment law? Below is a summary of the main Bills which will be of interest to employers and employees:
European Union Referendum Bill
This Bill is intended to lead to the much discussed in/out referendum on Britain’s continuing membership of the European Union (EU). The government plans to renegotiate the UK’s relationship with the EU and is planning to put the issue to a popular vote by 2017 at the latest. Withdrawal from the EU is likely to result in significant legislative changes in the UK’s employment laws as EU regulations would cease to apply.
This Bill intends to cut red tape and reduce regulation for small businesses in order to encourage job growth. Amongst the proposed measures will be the creation of a Small Business Conciliation Service to help settle disputes between large and small businesses, particularly in respect of late payment practices, and improvement of the business rates system. The Bill will also introduce a cap on public sector redundancy payments to six figures for the highest earners.
National Insurance Contributions Bill/Finance Bill
This Bill brings into effect a number of the Conservative’s election pledges regarding tax. It will ensure that future increases to the personal income tax allowance are linked to changes to the national minimum wage (NMW), thereby ensuring that people working 30 hours a week on the NMW will not pay income tax. The personal tax allowance will also be set annually, with the threshold before which people pay income tax to being raised to £12,500. There will also be no rises in income tax rates, VAT or National Insurance contributions for individuals, employees or employers before 2020.
Full Employment and Welfare Benefits Bill
This Bill will aim to create three million new apprenticeships and two million new jobs (resulting in full employment in the UK) over the next five years. The Bill will also introduce statutory duties on ministers to report annually to Parliament on their progress.
This Bill will give eligible working parents of children aged three or four years old free childcare for 30 hours a week, 38 weeks a year. This will effectively double the current entitlement.
Trade Unions Bill
As promised in the Conservative manifesto, this Bill sets out to reform trade unions and protect essential public services from disruption caused by strikes. Among the changes is the introduction of a minimum turnout of 50% for votes on union ballots (which will then require a simple majority of votes in favour), with an additional requirement for votes for industrial action in the essential public services (health, education, fire and transport) accounting for 40% of all members eligible to vote. Time limits on mandates following a ballot for industrial action will be introduced, as well as a transparent opt-in process for the political fund element of trade union subscriptions. New measures will also be put in place to prevent intimidation of non-striking workers during strikes, but the Tories’ promise to ban employers using agency workers to cover striking employees has not been included.
In an effort to control immigration, particularly the demand for skilled migrant workers and the exploitation of low-skilled workers, this Bill will make illegal working a criminal offence and allow wages paid to illegal migrants to be seized by police as proceeds of crime. A new enforcement agency will be created with powers to take action against employers who exploit migrant workers, and it will also become an offence for businesses and recruitment agencies to hire abroad without first advertising in the UK.
As the name suggests, this Bill introduces various measures aimed at tackling extremism. The legislation will include a new power to close down premises used to support extremism, whilst employers will be given the ability to check whether an individual is an extremist and bar them from working with children.
…but no British Bill of Rights
Both during the election and following the appointment of Michael Gove as the new justice secretary, the proposed repeal of the Human Rights Act 1998 to be replaced by a British Bill of Rights was a major talking point. However, rather unexpectedly no legislation regarding this made it into the Queen’s Speech. Rather, it is now likely that there will be a consultation regarding the proposal.
This article was first published on 29 May 2015 as part of our Employment Law Update series. Register above to receive our updates as soon as they are published, directly to your inbox!
This article is offered for general informational purposes only, and does not constitute legal advice. The views and opinions expressed in this article are those of the author(s) and do not necessarily reflect the views or opinions of Solomon Taylor & Shaw.