Employment - market insights April 2025

Nine months on from Labour’s success at the General Election, we take a look at recent changes to employment law and cast an eye over what lies ahead including the highly anticipated Employment Rights Bill.   

Consultation on Employment Rights Bill

A consultation has been carried out on the proposed Employment Rights Bill. Some key points for employers to note are:

• The removal of the 2-year qualifying period for unfair dismissal claims. The length of any initial period of employment during which employers may dismiss employees without having to follow a full process has not yet been confirmed.
• The right to switch off has been omitted from the draft Bill and therefore appears to not be proceeding;
• The right for workers (including agency workers) who meet eligibility requirements to be offered guaranteed working hours.

Consultation on costs protection for discrimination claims: call for evidence

Views and evidence have been sought by the Government on whether costs protection ought to be afforded to claimants who pursue claims of discrimination in the civil courts. Unlike in the Employment Tribunal, claimants who pursue claims which are allocated to either the fast track or multi-track in the civil courts automatically face a costs order against them in the event their claim is unsuccessful. The consultation which has recently closed was to consider whether this process deter claimants from pursuing meritorious claims and so ought to be altered.

National Minimum Wage increase

Increases to the national minimum wage will apply from 1 April 2025 as follows:

• For employees aged 21 and over: £12.21
• For 18-20 year olds: £10.00 an hour
• For 16-17 year olds: 7.55 an hour.

Draft Equality (Race and Disability) Bill to be published

This draft Bill will clarify the right to equal pay for disabled individuals and individuals from ethnic minorities. The bill will also introduce a requirement for employers of 250 or more employees to provide ethnicity and disability pay gap reporting, extending the requirement from gender pay gap reporting only.

Worker status – Key Tribunal Decision 

In Afshar and others v Addison Lee Limited [06.01.25], a significant decision on employment status, some 700 Addison Lee taxi drivers were found to be workers rather than self-employed contractors by an Employment Tribunal. This decision is the latest in a string of high-profile decisions on worker status and is significant as it gives the claimants the right to claim for backdated holiday pay and national minimum wage payments.

Paid Neonatal Care Leave

Taking effect from April 2025, employees who meet the eligibility criteria will be entitled to up to 12 weeks’ paid leave where they have a baby requiring neonatal care.