Employment Rights Bill

Baroness Penn Excerpts

2nd reading
Thursday 27th March 2025 Lords Chamber

[Baroness Penn (Con)]

My Lords, I add my congratulations to the quad of maiden speakers we have had in our debate today. In four minutes, you need to cut to the chase, so that is what I will do.

I am not someone who believes that that any improvement to employment rights negatively impacts employers or the economy. But, as the Government themselves have said, it is all about balance. Too many of the provisions in this Bill have got the balance wrong—including the day one right on unfair dismissal. The Government themselves recognise this. That is why they have committed to introducing a probationary period, but we have no detail on how this would work. That is just one of many examples in this Bill where the detail is not developed and employers have serious concerns.

Not only have the Government got the balance wrong in the Bill, at the same time they have failed to address one of the biggest imbalances in employment rights: paternity leave. In the UK, we give mothers 52 weeks of maternity leave and fathers just two. This is the lowest level of paternity leave across Europe. Take-up of that two weeks is lowest among dads on low pay, as the rate of pay for that leave is so poor.

The Minister said that new action plans would help close the gender pay gap. We can be confident that they will lead to plans, but less confident that they will lead to action. Instead, more generous paternity leave has demonstrated that it can close the gender pay gap. It is also good for fathers, good for children and, importantly, good for the economy. ILO research shows that it can contribute 2% to 3% of GDP. I know that the Government intend to do a review on this, but there has already been an evaluation and a consultation—so now is not the time for another review. It is time for action.

The other imbalance I want to address is the increase in compliance costs for businesses doing the right thing, while leaving significant loopholes allowing labour market abuse. Substitution clauses have traditionally been used to give small businesses flexibility. But there is increasing evidence that they are being abused by contractors to gig economy businesses.

With its substitution clauses, Amazon tells couriers that it is their responsibility to pay their substitute at any rate agreed with them and that they must ensure that any substitute has the right to work in the UK. This is clearly not happening. During random checks two years ago, the Home Office found that two in five delivery riders who were stopped were working illegally. And, from late 2018 to early 2019, there were 14,000 fraudulent Uber journeys, according to TfL.

It is not right to pass responsibility for compliance with criminal and right-to-work checks on to workers. The introduction of a comprehensive register of all dependent contractors would help to ensure that employment rights are upheld, pay is not suppressed through illegitimate competition, and support for the enforcement of right-to-work checks. If the Minister will not listen to me, perhaps she will listen to the App Drivers and Couriers Union, which says:

“Unfortunately there is this loophole that allows some bad people to come through. They are not vetted so they could do anything”.


I hope the Minister will take action to address the balance of this Bill. At the moment, it risks damaging jobs and growth, while at the same time it fails to address some of the most significant flaws we have in our labour market today.