Employment Rights Bill

Lord Londesborough Excerpts

2nd reading
Thursday 27th March 2025 Lords Chamber

[Lord Londesborough (CB)]

My Lords, I have just four minutes, so I will not beat about the bush. While I understand the need to bear down on unscrupulous employment practices, this Bill is fundamentally misguided, out of date and out of touch and will wreck the spirit of enterprise. It will damage jobs, productivity and wages across both the public and private sectors. That is not just my view, but the OBR’s. The impact assessment, which claims that the Bill will have a net positive impact on growth, is guilty of fantasy economics, suggesting that its authors have little feel for, or experience of, creating jobs, developing careers or even meeting payroll.

Perhaps most troubling is that all the clauses in this 300-page Bill, and its 200 pages of Explanatory Notes, apply to all employers without exception, whether you are a UK multinational with a workforce of 100,000, a start-up with 10 staff or a family business with two employees. It is one size fits all, whether we are talking about day one rights, probationary periods, guaranteed hours or flexible working. This Bill shows scant regard for building a competitive economy with modem working practices. It discriminates against SMEs—our country’s engine of growth—and offers nothing for freelancers and the self-employed, for which perhaps we should be grateful.

My views are shaped by my lived experience over 30 years as an entrepreneur and employer, from a start-up with two employees around the kitchen table to building a workforce that grew to 10 staff, then to 50, 100 and eventually to 300 employees, plus 100 freelancers. I learned what it takes to recruit and train people effectively, to incentivise and reward them and to develop their careers from probation to permanent, from junior to management and from internship to becoming an equity partner. I took risks and made many mistakes along the way, from hiring the wrong people, holding on to staff for too long, overpaying, underpaying, growing too quickly and having to downsize in the rough and tumble of the free market. But here is the thing: I never once ended up in an employment tribunal and my experiences with staff and freelancers were overwhelmingly positive, driven by common mutual interest and without the need to resort to onerous employment manuals, interfering HR departments or, indeed, employment lawyers.

This Bill suffers from overreach and will kill entrepreneurial spirit, coming as it does on the back of the misguided NICs Bill, on which I have fought hard to protect our smaller businesses—and I will go into battle again on their behalf in Committee on this Bill, mindful that the Federation of Small Businesses reports that two-thirds of its members say that the proposals in the Bill will make them curb hiring. There are two professions that will benefit from this Bill—HR practitioners and employment lawyers—but, in terms of productivity, this Bill is terribly timed and represents another giant vampire squid sucking the life out of our economy.