Summary
An assessment showed that changes to Labour's planned workers' rights reforms will save businesses up to £4 billion annually, reducing the cost from an earlier estimate of £5 billion to £1 billion per year. The reforms, including immediate sick pay and protections for mothers, faced mixed reactions, with business groups supporting them and some Labour members and unions criticizing the concessions. The Employment Rights Act aims to benefit around 18 million workers, with a slight positive impact on employment and economic growth.
Key Facts
- Labour's concessions will save businesses an estimated £4 billion each year compared to initial plans.
- Originally, proposed reforms were estimated to cost firms £5 billion annually; this figure is now revised to £1 billion.
- The Employment Rights Act offers sick pay and paternity leave from the first day and adds protections for mothers.
- Plans to allow unfair dismissal claims from the first day have been replaced by a six-month employment requirement.
- The reforms are to be phased in over several years, with further consultation and legislation needed.
- The changes are expected to positively impact employment rates and economic growth slightly.
- Trade unions claim these rights will benefit 18 million workers, up from an earlier estimate of 15 million.
- Some business representatives argue that the cost estimates may be too low and underestimate real costs.
