“Chapter 4A

Chris Law Excerpts

Tuesday 11th March 2025 Commons Chamber

[Chris Law (Dundee Central) (SNP)]

I apologise to the Minister because he has moved on, but I want to come back to the new level of statutory sick pay, which is £118.75 or 80% of an employee’s weekly earnings. An employee with weekly earnings of £125 would at present get £116.75, but under the new model, they would receive only £100. Is that correct?

[Justin Madders]

Yes, but the hon. Member forgets the fact that we are removing the waiting days. With the provisions on the lower earnings limit going, 1.3 million people will be accessing statutory sick pay. We think that that is the right balance and that it will leave people in a much better position. Of course, it is something that we will always continue to review.

Moving on to umbrella companies, we are aware of non-compliance in this market, where umbrella companies can be responsible for denying employment rights to those who work through them. New clause 36 will allow for the regulation of umbrella companies and for enforcement by the Employment Agency Standards Inspectorate, and subsequently the Fair Work Agency. The specific requirements on umbrella companies will be set out in the relevant regulations, which set out the minimum standards of conduct for employment agencies and employment businesses. We will consult before amending these regulations, and we are committed to working with the sector to ensure that future regulation works effectively for umbrella companies. The amendment marks an important step towards ensuring non-compliant umbrella companies are no longer able to deny workers the rights they are owed.

The Government are moving a range of amendments in relation to part 3 of the Bill, which covers the adult social care negotiating body and the school support staff negotiating body. On the SSSNB, the Government are moving two technical amendments to correct incorrect cross-references. The body is an important part of delivering both the Government’s “Plan to Make Work Pay” and our opportunity mission. The Government will today commit to consult in the summer on whether agency workers should be brought into scope of the SSSNB in future legislation to support those missions.

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[Imogen Walker (Hamilton and Clyde Valley) (Lab)]

As per my entry in the Register of Members’ Financial Interests, I am a member of GMB. My union membership has given me reassurance for many years that I have backing if I need it. I am conscious that although in this place we may be listened to when we speak up, for too many people insecurity and lack of respect at work are an everyday experience.

Businesses suffered under the failure of the previous Government to act when reform was needed. That was not in this area alone, of course, but today we are speaking about the relevant amendments. We can come back to their other failings another day—or perhaps on more than one other day—because this is the time for action and we are the party of business.

Everyone should have a contract that reflects the hours that they work. There is a place for flexibility, but people need to sort out transport and childcare and plan their household budgets, so we will ensure that agency and low or zero-hours contracts work for both sides—for businesses and workers. For too long, zero-hours contracts have often been at the expense of people who are just trying to make a living for themselves and their families. We will put a stop to that.

A day’s work deserves a fair day’s pay, and giving the Fair Work Agency the power to bring civil proceedings and issue penalties is an important move. The vast majority of employers respect the rights of the people who work for them and have nothing to fear from that. In fact, they will welcome the levelling of the playing field. As they tell us all the time, their good practice must not be undermined by the unscrupulous minority.

We also say that everyone should be free from harassment when they are at their place of work. The message that Conservative Members send when they object to that protection—to, among others, the many thousands of young women who have been harassed at work—is appalling. In contrast, we believe that everyone deserves respect at work, whatever the industry they work in. I want to reassure, among others, workers in the hospitality and retail industries that they matter, they deserve better and we are on their side. Further, when issues happen, it is to everyone’s benefit to resolve them quickly. We will fast-track decision making and back that up with robust fines. That helps businesses and workers and it minimises stress, cost and delay.

I am pleased that the Bill is welcomed by many of our leading employers, including Centrica, as already mentioned. I know Centrica well; it has a training academy in my constituency. Its chief executive, Chris, is fully supportive of the legislation as not just the right thing to do but as a foundation for a high-growth, high-skills economy and the progress that our country needs.

A stable workforce will help both employers and workers. The chaos of repeated strikes has damaged businesses and services and left our country reeling. The Conservative party may be instinctively opposed to empowering ordinary people, but on the Labour Benches, we say that these are the people who keep our country going and they have the full support of this Government.

[Chris Law]

I rise to speak to new clause 75 and to other new clauses and amendments in my name.

Last year, the Labour party committed to

“strengthen statutory sick pay, remove the lower earnings limit to make it available to all workers and remove the waiting period.”

Although the removal of the lower earnings limit and the waiting period are welcome, the fact remains that the UK’s statutory sick pay does not meet the needs of working people. The miserly increases to the rate—it has just been increased by £2 after five years—are far from the transformative change that Labour promised and will not help to deliver a healthier population and a growing economy. Indeed, only a few years ago, during the covid period, the Minister noted that the then Health Secretary had

“admitted that he could not live on statutory sick pay”.—[Official Report, First Delegated Legislation Committee Delegated Legislation Committee, 25 January 2021; c. 7.]

To be clear, the UK is lagging behind in its provision of SSP, offering one of the least generous systems in the OECD. While the Labour Government propose a rate of £118.75 a week, or 80% of average weekly earnings—whichever is lower—numerous other European countries, such as Austria, Germany, Iceland and Luxembourg either provide full salary payments or cover a portion of earnings ranging from 50% to 90%. Amendment 272 would bring the UK into closer alignment with other OECD countries.

With limited coverage and relatively low rates, many workers and particularly low-income and part-time employees are left without sufficient financial support when they fall ill. Such a gap in sick pay provision impacts workers’ wellbeing, exacerbating financial stress during illness, and can discourage people from taking the necessary time off to recover. It contributes to poorer health outcomes, undermining longer, healthier working lives across the UK population. Surely no one in this House wants that to continue.

The Joseph Rowntree Foundation states that the most effective way of strengthening sick pay is by increasing the rate. There are numerous amendments that would do that, including new clause 76 in my name, which would gradually increase the rate of statutory sick pay over the next five years, taking it to at least 80% of the rate of the national living wage, and others that propose SSP to be the higher of a prescribed rate or percentage of usual weekly earnings. Moreover, a report by WPI Economics shows that sick pay reforms could result in a net financial benefit to this country of more than £4 billion. It also found that the positive effects of sick pay reform would particularly help the increasing proportion of the British workforce who manage long-term conditions and ensure that fewer workers fall out of the job market entirely.

As an example, many people with multiple sclerosis need to take time off work for varying lengths of time for reasons related to their condition. Some people with MS are well supported by their employers through occupational sick pay—of course we support that—and can take the time off work that they need on full pay. When people with MS can get the financial support they need while they are off work, they can often stay in work for longer, as they can better manage their symptoms in the long term. This needs to be the same for all those with MS and other long-term conditions who rely on SSP.

New clause 75 would require the Secretary of State to consider such a change, with the aim of properly reforming this outdated and inflexible system. Changes for those with such conditions could include SSP being paid at an hourly rate, rather than a daily rate, to enable people to work half or part days on a gradual, phased return to work, or changing the restrictions on how people can claim and use SSP so that it is fairer for people with fluctuating conditions by extending eligibility timeframes. Sadly, however, I suspect that the Labour party is looking to slash welfare spending, as has been reported today—700,000 disabled people being pushed into poverty will be no joy to many—and that it has little interest in making such supportive and progressive change. I look forward to hearing from the Minister.

The Labour Government’s lack of gumption in their approach to SSP is illustrative of the timidity of their approach in this Employment Rights Bill. Yes, the Bill makes improvements to the rights of working people and, yes, it reverses some of the worst excesses of the Tory Government, but it could have done so much more. Where is the straightforward system defining a single status of worker to replace the maze of confusing classifications, designed to limit protections, that continue to exist? Where are the increased provisions for collective bargaining to alleviate low pay? Where have the promises disappeared to of the right to switch off, which would ensure better work-life balance?

This was the opportunity to legislate to entrench employment rights and to ensure a fairer deal for workers and a healthier, more equitable and more productive economy and society. Unfortunately, this Bill is left wanting. I hope that, if the Labour party is serious about its manifesto commitments, the Minister will look at these new clauses and amendments.

[Lorraine Beavers (Blackpool North and Fleetwood) (Lab)]

I welcome the Report stage of this Bill. I proudly declare my membership of Unite and the Communication Workers Union and I refer the House to my entry in the Register of Members’ Financial Interests.

This Bill will see the biggest upgrade to workers’ rights for a generation. It is an agenda for change—change that is desperately needed. Working class people keep this country cared for. They keep our streets clean, our shelves stacked and our public services running, but the imbalance of power in our workplace is plain to see. The P&O scandal was testament to that. This Bill represents a crucial first step in redressing that imbalance, especially amendment 80 on sick pay. It strengthens both collective and individual rights and puts more money in the pockets of working people.

I therefore welcome the Government’s amendment to the Bill ensuring that everyone gets sick pay from the first day they are ill, including those previously excluded for earning too little. Currently, around 1.2 million workers are excluded from statutory sick pay altogether, and the present three-day wait is extremely hard for those on low pay who often budget on a week-to-week basis. Me and my husband were those people who lived week to week and dragged ourselves into work when we were not well, because if we did not work, we did not eat when my children were small. The fact that the Bill rectifies that is extremely welcome.

The pandemic exposed just how inadequate current levels of sick pay are. I therefore urge the Government to ensure that as many workers as possible benefit from the measures in the Bill. In particular, they should look at what they can do to increase the rate of statutory sick pay over time, as we currently have one of the lowest rates of sick pay across the developed countries. I hope the Government continue to consider the impact of the removal of the lower earnings limit to ensure that everybody benefits from the measures in this Bill.

Overall, these changes will be transformative for working people in my constituency. As a working-class woman from a council estate, it does my heart good to be able to stand in this place supporting changes that will make the lives of working people better and give them the rewards they so deserve.