Employment Rights Bill

Baroness Lawlor Excerpts

Committee stage
Tuesday 24th June 2025 Lords Chamber

[Baroness Lawlor (Con)]

My Lords, I will pick up on a few of the points made by my noble friend Lord Hunt to support Amendment 335 wholeheartedly. In principle, I am in favour of sunset clauses because they help us to focus on a Bill not once but twice, as they will pass legislative scrutiny twice over, and they encourage us to make better law. There are very practical reasons for Amendment 335. We have a 4.4% unemployment rate—or we did up to November last year—and it is increasing, with 1.7 million people in this country unemployed.

This Bill, as we have heard time and again—I know the Government disagree, but the figures speak for themselves—will increase the cost of and burdens on employing people, restrict job entry and limit new posts being advertised. The number of job vacancy adverts is decreasing. Since the Government came to power, the tally I mentioned earlier—I am sorry to repeat it—is 115,000 jobs lost. At this rate, there is a very good reason to support such an amendment. I hope the Government will take on board that we must consider a sunset clause in case unemployment rises and employment levels go down significantly in three years’ time.

[The Parliamentary Under-Secretary of State, Department for Business and Trade and Department for Science, Information and Technology (Baroness Jones of Whitchurch) (Lab)]

My Lords, I thank the noble Lord, Lord Norton, for tabling Amendment 323C and the noble Lord, Lord Hunt, for Amendment 335. I pay tribute to the expertise of the noble Lord, Lord Norton, in this area. I reassure the noble Lord that, despite Amendment 323C’s positive intentions, it effectively repeats what the Government already intend to do.

Our impact assessment sets out a clear plan to monitor and evaluate the effects of the Bill and its secondary legislation, following standard government practice. This approach will help us assess how well the measures are delivering on their objectives, inform future policy-making and review the real-world impact on all stakeholders, whose contributions we recognise as vital to the strength of our economy. As is standard practice, in line with our Better Regulation Framework obligations, we also intend to conduct a post-implementation review of the Bill within five years of Royal Assent. This will provide sufficient time to assess the policy’s effectiveness and gather sufficient data for evaluation purposes.

In the case of the fair work agency, ongoing oversight of employment rights enforcement is provided for in Clauses 91 and 92. They require the Secretary of State to publish a three-year labour market enforcement strategy and annual reports, which must be laid before Parliament and the Northern Ireland Assembly. Secondary legislation made under the provisions in this Bill will also be subject to the requirements in the Small Business, Enterprise and Employment Act 2015 regarding proportionate monitoring and review.

In addition, where further detail will be set out in secondary legislation, the majority of statutory instruments will be subject to the affirmative procedure, allowing both Houses to consider them in detail and providing Parliament with sufficient opportunity for scrutiny and debate. Furthermore, the Government will consult on many of the details to be set out in secondary legislation, listening to the expertise of business, trade unions and civil society to ensure that the details of the regulations are appropriate to the current needs of the labour market.

On Amendment 335, in the name of the noble Lord, Lord Hunt, we want to ensure that workers have these rights for life and not just three years, as the noble Lord proposes. As a result, we oppose his amendment. As is typical with employment legislation, further details on many of the policies in the Bill will be provided through regulations after Royal Assent. We will begin consulting on these reforms in 2025, seeking significant input from all stakeholders. We anticipate this meaning that the majority of reforms will take effect no earlier than 2026. We are committed to getting the detail right. This means listening to and incorporating a wide range of views into our policy development.

While headline statistics, such as employment and unemployment rates, may appear strong by historical standards, millions of workers are stuck in low paid, insecure and poor-quality work that is detrimentally affecting their financial stability and health. The UK’s productivity slowdown is more severe than in other advanced economies. A fragmented labour market and too much insecure work are holding back growth and investment. We also lag behind the OECD average on employment protections, and we have paid the price. The UK economy has not grown at the average rate of other OECD economies in the last 14 years, missing out on £171 billion-worth of growth. Average salaries have barely increased from where they were 14 years ago, and the average worker would be over 40% better off if wages had continued to grow as they did leading into the 2008 financial crisis.

This Bill will ensure a fairer, more equal labour market and deliver wider benefits to the business environment by improving well-being, incentivising higher productivity and creating a more level playing field for good employers. Consider a few of the changes it will bring: over 10 million workers in every corner of the country will benefit; increased well-being alone could be worth billions of pounds a year; there will be less workplace conflict, which costs UK employers about £30 billion a year; and up to 1.3 million employees will gain a new entitlement to statutory sick pay, increasing total sick pay by £400 million per year.

The noble Lord, Lord Hunt, spoke about the way businesses are perceiving this, but, as my noble friend Lord Leong said, business confidence is actually rising. The latest Lloyds Business Barometer survey shows business confidence at a nine-month high, with rising hiring expectations among businesses. I have to say to the noble Lord, Lord Hunt, that a sunset clause would create business uncertainty at the very time when we want to build on that confidence. The industrial strategy, which we published yesterday, has been welcomed by all sectors of business and will help to build that long-term strategy for growth.

Given the benefits the Bill will bring for workers over the long term, we oppose the noble Lord’s amendment and will continue to promote growth for businesses and the level playing field for good employers. With this in mind, I ask the noble Lord, Lord Norton, to withdraw Amendment 323C.