Insights Election 2024 employment implications – party by party: Labour


Hot on the heels of our recent briefings about the Liberal Democrat and Conservative manifestos, here is the final part of our employment and immigration briefing series looking at the Labour Party’s proposals in their manifesto that was launched on 13 June 2024.

As before, this piece is aimed at summarising and demystifying the key employment and immigration proposals of the Labour Party and considering what they might mean for business and the wider media and technology industries.

All change?

For a document entitled ‘Change’, you’d be forgiven for wondering whether there is actually going to be any change on the employment and immigration front based on a cursory look through Labour’s manifesto. In fact, you have to get fairly deep into the text before there is any talk of employment reform – the first notable mention being a fairly generic statement that “Britain’s outdated employment laws are not fit for the modern economy”.

When you do finally get to the meat of the employment and immigration offering, it again looks curiously brief, particularly when compared to the more extensive list of reforms being proposed by the Lib Dems. Surprising, you might say, given the origin and traditional roots of the party. However, what may look subtle on the face of it belies the potential for some quite radical and wide-reaching reform (see further analysis later in this piece).

The key pledges are summarised below:

  • Labour say they will fully implement their previously announced ‘Plan to Make Work Pay: Delivering a New Deal for Working People’, with legislation being introduced within 100 days following consultation with businesses and workers. This could potentially be very significant as the New Deal for Working People would represent substantial reforms, including new day-one rights, enhanced sick pay rules and (most significantly) a step-change in the coverage of unfair dismissal protection;
  • It’s proposed that a new Single Enforcement Body will be created to ensure employment rights are upheld. Whether you’re an employer or an employee, there are inherent issues with a system whereby an employment tribunal is unable to list a routine hearing within 12 months, so it’s hard to dispute the need for a bit of a shake up here;
  • Changes to the minimum wage rate so this becomes a “genuine living wage” that accounts for the cost of living, with the age bands being removed so that all adults are entitled to the same minimum rate of pay;
  • Enhanced equality rights, including the introduction of legislation in an effort to ensure equal pay for Black, Asian, other ethnic minorities and disabled people. Disability and ethnicity pay gap reporting obligations would also be introduced for large employers, together with new protections from maternity and menopause discrimination and sexual harassment. Whilst significant, there’s next to no detail on what these changes would actually mean in practice at this stage; and
  • Growing the creative industries by creating “good jobs and accelerating growth in film, music, gaming, and other creative sectors”. Whilst the detail is again lacking here, the aspiration is certainly positive for the creative industries.
  • Labour plan to reform the points-based immigration system to make it “fair and properly managed, with appropriate restrictions on visas, and by linking immigration and skills policy”. Like the Conservatives, this suggests a clear agenda to reduce net migration although there would appear to be much more scope for flexibility and latitude under the Labour proposals which is likely to provide comfort for those businesses with active sponsor licences; and
  • The Migration Advisory Committee (“MAC”) will be strengthened alongside the introduction of a new framework for joint working with skills bodies across the UK, the Industrial Strategy Council and the Department for Work and Pensions. The idea here is to ensure that there are strategies to upskill UK workers in areas where immigration is being used to plug skill shortages.  Labour also plan to crack down on companies sponsoring workers if the workforce training they provide is insufficient. This is suggestive of a more rigorous approach towards sponsors.
More than meets the eye

There are plenty of broad statements within the Labour manifesto and it would be easy to take the view that the proposed reforms of employment and immigration law are all talk but no substance (as the Conservatives consistently argue in respect of Labour’s offering generally).  A more considered reading though might suggest quite the opposite.

Arguably, considerable care has been taken to craft what would be a broad mandate that could potentially allow for substantial new employment rights, whilst retaining flexibility to support a breadth of options depending on the way the wind blows in the coming months and years following the election. Here’s our view on what’s likely to be of most interest:

  • There are potentially huge implications for employers with the proposed changes to the law related to unfair dismissal. The New Deal for Working People suggests protection for unfair dismissal will become a day-one right for all workers (and not just employees), although there would appear to be some leeway where a worker is dismissed within their probation period.  If this were enacted, many employers would need to drastically change their approach to assessing performance and suitability at the start of employment, with employers likely utilising much longer probation periods (assuming the new rules allow such an approach). Considerable head scratching will also likely be required by those who regularly engage freelance talent or casual workers (such as Film and TV productions or ‘gig economy’ employers) to avoid falling foul of the new protections at the end of engagements;
  • Whilst the above may raise heart rates a little, the clear messaging is that consultation will play a central role prior to the introduction of reform. Therefore, expect business to have its say on a lot of what is proposed and for the scope of new rights to be far less wide reaching than might otherwise appear to be the case. Labour’s pro-business rhetoric is consistent and it therefore seems very unlikely that changes will be implemented that have the risk of overburdening employers; and
  • Immigration will remain on the agenda as it has now become politically unavoidable. However, expect the focus to be placed firmly on illegal immigration with more flexibility likely to be permitted in relation to legal routes.  So in other words, a little tinker here and there but hopefully nothing too concerning for businesses who regularly source or bring in talent from overseas.

That brings us to the end of our manifesto briefings (you’ll have to go elsewhere to read about Reform UK’s proposal to scrap current protections for discrimination and harassment… sigh!). Proposals on employment and immigration reform are unlikely to be significant drivers for how the public will vote in a few weeks’ time, but the outcome of the election will certainly have an impact on how this crucial area of the law develops.

We will of course be keeping a keen eye on developments. Should Labour end up victorious as most now expect, we look forward to fleshing out what this will mean in more detail following the result on 5 July 2024.