The Employment Rights Bill returns to the House of Commons today amid fierce political division, with Conservatives calling for the government to abandon what they claim would be a “crippling” overhaul of employment law.
The flagship Bill, central to Labour’s workplace agenda, aims to extend a range of rights and protections to workers from their first day in a new job. It includes protection from unfair dismissal, access to parental leave and sick pay and limits on the use of zero-hours contracts. It would also outlaw “fire and rehire” practices and strengthen the ability of trade unions to organise and bargain collectively.
Labour has described the Bill as the most significant upgrade to workers’ rights in a generation, arguing that it will tackle low pay, precarious work and declining job security. But critics on the opposition benches warn it could drive up costs for employers and threaten jobs at a time when the economy is under strain.
Clash over economic impact
Shadow business secretary Andrew Griffith said Labour’s proposals would “cripple economic output and cost 326,000 people their jobs and livelihoods”. He said businesses were already “reeling from the jobs tax and rising prices” and warned that the Bill would “worsen their pain by hiking costs and facilitating widespread strikes”.
Griffith said firms were struggling under the weight of what he called Labour’s “jobs tax” and rising prices, arguing that the new legislation would add to those pressures. He said it would “hike costs and facilitate widespread strikes,” and urged the government to “stand up to the trade union bully boys” rather than risk “economic havoc”.
The Conservatives have also argued that the measures would make employers more cautious about hiring new staff and could undermine competitiveness in sectors such as hospitality, logistics and manufacturing, which rely heavily on flexible labour.
Ministers stand by their reforms
The government has dismissed the Conservatives’ claims and defended the Bill as essential to improving productivity and living standards. A spokesperson said ministers did not recognise the figures used by the opposition in their economic assessment.
“Our Employment Rights Bill will end the days of low pay and falling standards and drive economic growth by boosting the working conditions and living standards of over 15 million workers,” the spokesperson said. “Most employers recognise that happy workers are more productive and we will continue to work with them to deliver the growth that this country needs.”
Officials have argued that by improving job security and encouraging long-term employment relationships, the Bill will support sustainable business growth. They say the reforms are designed to bring the UK’s labour protections more in line with other advanced economies while maintaining flexibility for employers.
Labour defends ‘biggest upgrade in a generation’
A Labour Party spokesperson said the Conservative position showed “they haven’t changed at all” and accused them of siding with business interests over working people.
“A day after Reform said it wants to cut the minimum wage for young people, the Conservatives are calling to scrap the biggest upgrade in workers’ rights in a generation,” they said. “Labour’s Employment Rights Bill will bring Britain’s outdated employment laws into the 21st century and turn the page on an economy held back by insecurity, low pay and poor productivity – giving working people the stability they deserve.”
The spokesperson added that the “Tories are trying to block new parental leave rights, measures to tackle exploitative zero hours contracts, the ending of ‘fire and rehire’, new protections for working families and more. They’ve never been on the side of working people…”
Labour argues that the Bill reflects its broader strategy to “make work pay” by ensuring fair treatment and consistent standards across all employment types. It forms part of a wider legislative programme designed to strengthen social protections and rebalance power between workers and employers.
Legal experts warn of risk for employers
Employment lawyers have also raised concerns about the scale and timing of the proposed changes. Jo Mackie, employment partner with national law firm Michelmores, told HRreview that the Bill posed “huge risk” for employers by removing traditional probationary safeguards.
“The draft Employment Rights Bill contains clauses that the Institute of Directors and the Confederation of British Industry have found concerning,” she said. “For example, the introduction of a first day right to unfair dismissal, which eliminates the long held practice of a probationary period, and places huge risk on employers to get everything right from day one, or face litigation.
“This undermines the goodwill that many employers show when helping new staff to settle in and meet their objectives. In a time of financial constraint, putting more pressure on employers means the rewards for hiring staff are outweighed by the risks they pose.”
Lords challenge key provisions
The Bill has been through a turbulent journey in Parliament. It is currently in the so-called “ping-pong” stage of scrutiny, where the Commons and Lords debate amendments and attempt to reach agreement on the final wording.
When it last appeared in the upper chamber, last week, ministers suffered a string of defeats. Peers rejected provisions that would give “day one” rights to protection from unfair dismissal, arguing that such changes could place an undue burden on small businesses. They also opposed attempts to alter union regulations, voting to keep the 50% turnout threshold required for industrial action ballots and to remove a clause that would automatically enrol new union members into paying a political levy.
Supporters of the Bill in the Lords argued that these defeats weakened its intent, while opponents said they were essential safeguards to prevent an overreach of state intervention in the labour market.
A defining moment for workplace reform
The Commons debate today is expected to be one of the most closely watched of the parliamentary session, setting the tone for Labour’s approach to business and employment policy. If approved, the Bill would represent a major change in the UK’s post-Brexit labour framework, moving closer to European-style protections after years of relative deregulation.
Employment law specialists say the reforms could have far-reaching implications for HR policies, recruitment practices and dispute resolution. They note that introducing day-one rights could significantly reduce the period during which new staff can be dismissed without recourse, prompting employers to place greater emphasis on probationary assessment and documentation.
Supporters believe this will lead to a more stable and motivated workforce. Critics, however, say it could discourage risk-taking in recruitment and increase the administrative burden on small and medium-sized enterprises.
As the government seeks to balance pro-worker reform with economic growth, the outcome of the Commons debate will signal whether Labour can deliver on its promise of a “new deal for working people” without alienating business confidence.
