What Can Businesses Expect from a Labour Government?
With a new Labour Government at Westminster, what changes are businesses likely to see? We’ve asked a number of our Client Legal Directors to tell us what’s on the horizon...
Employment Law under Labour
By Kate Palka
Employment law is heavily influenced by political ideology and with a new government in place, we can expect significant change. Labour has set out clear priorities based on a commitment to a significant overhaul, aiming to create a fairer balance between employers and employees.
They have pledged a number of changes within their first 100 days, to be incorporated into a new Employment Act. Some of these are explained below.
- Greater access to tribunals: Employees will have six rather than three months in which to bring claims to tribunal. Additionally, the right to claim unfair dismissal from the first day of employment will apply from day one, removing the current two-year qualifying period. Labour have said that this will not prevent fair dismissals or probationary periods with “fair and transparent” probationary processes, but this is a radical change and will require every employer to consider how they deal with employees in the initial months of their employment.
- Flexible Working: The Conservative Government recently made this a day one right but Labour are going further to make flexible working the default: the eight different reasons currently available for employers to choose from to reject a request will be replaced so that employers may only say no “where it is not reasonably practicable”.
- The legal right to “switch off” from the 24/7 office is already widespread in Europe and while Labour is unclear about how this will be implemented in practice, whether they will adopt the less stringent “Irish” model (or, say, the strict French model), what we do know is that employers will have to work on policies and terms with their employees to find mutually acceptable boundaries. Similarly, protection for employees against remote surveillance by employers is on the cards.
- Labour will end “one-sided” flexibility, banning zero hours contracts and ensuring that zero hours workers have the right to request a contract that reflects the number of hours they regularly work (based on a twelve-week reference period).
- New processes will be required for restructuring, ending the use of “fire and rehire”, where an employer dismisses the workforce and re-engages it on new terms: while acknowledging that it is important that businesses can restructure to remain viable, but the new rules will require process based on dialogue.
- In the area of diversity, equality and inclusion, employers of over 250 people will have to produce Menopause Action Plans, setting out how they will support employees through the menopause. Large employers must also report on pay gaps related to ethnicity and disability (in addition to gender).
- The workplace harassment legislation introduced by the Conservatives will be extended to include harassment by third parties, and protections for whistleblowers will be increased.
These are just a taste of the new Government’s plans, so employers will need to continue to stay informed and ready to respond to legislative shifts over the next five years.
What’s ahead for Data Protection law and regulation?
By Amanda Heath
The Data Protection and Digital Information Bill did not make it through “wash up” before parliament was prorogued and there appears little appetite to revive it, at least in the short term. Whilst the Labour manifesto and the Kings Speech committed to improving data sharing across public services and introducing provisions to support data sharing, there has been little specific reference to further data protection reform, perhaps not unsurprisingly.
We await the details but the smart data and information sharing schemes which may benefit scientists, business and start ups could be of great value.
Labour have stated a commitment to strengthening relations with Europe and will be mindful of the EU Commission’s decision, due by June 2025, as to whether to renew the UK’s adequacy status. In these circumstances and despite a reference to targeted reforms to some data protection laws, wholesale reform of the UK GDPR and the Data Protection Act 2018 seems unlikely.
What appears much more of a priority is a focus on the activities of Big-Tech and how they use our data: the new government has stated that it wishes to regulate AI along the lines of the European model and that it will bring forwards the provisions of the Online Safety Act to protect social media users as soon as possible.
Intent on boosting the economy, progressive data strategies and policies will be key for the government and undoubtedly these will impact personal data and regulation of the use of personal data. We will keep you informed of developments as they arise.
Labour have stated a commitment to strengthening relations with Europe. In these circumstances, wholesale reform of the UK GDPR and the Data Protection Act 2018, seems unlikely.
AI regulation under Labour
By Kiley Tan
It is likely that the new government will herald a boom for AI, especially in terms of the hardware. Labour’s manifesto explicitly, though briefly, states that planning barriers to new data centres will be removed and, with Chancellor Rachel Reeves putting planning reform high on her agenda, it seems that the new government is committed to investment in the infrastructure so necessary for AI development.
A promise for new binding regulation following the European model signals a deviation from previous regulation. There is still much to be done to allow startups to use text and data mining, but ultimately it is anticipated that the government will fall into line with the EU and allow it unless specifically excluded by website owners. This will speed up UK’s AI capabilities.
Life sciences under Labour
By Mark Duckworth
Increased public spending under a Labour government is expected to impact the life sciences sector. But in an environment where we are told money is tight, can we expect the proposed changes to see the light of day? If you ask Wes Streeting, Secretary of State for Health, then yes. His pledge to make Britain “a powerhouse for life sciences and medical technology” is, according to him, intrinsically linked with Britain’s economic recovery. The aspiration is for increased R&D, incentivising private investment, rather than public money through incentive schemes.
The new government’s proposal on re-aligning workforces could see better education and training and make the work environment more attractive, thereby attracting and retaining talent. The big hope is that we will see a streamlining of the regulatory environment which could help to drive down drug prices and therefore have a positive knock-on effect for the NHS in terms of its drugs budget. A less isolationist approach to the international environment is hoped for which could see the UK becoming more globally competitive in what is a key, but often overlooked, sector for the UK and a key employer.
Remain fully committed to your sustainability strategy (or get one in place ASAP if you haven’t already), as Labour will be expecting business to be properly engaging with these challenges.
What does Labour’s approach to the environment mean for business?
By Andrew Magowan
From an environmental perspective, the most immediate winner from the election is the planet itself. Gone are the disgraceful days of the environment being used as a political football in ridiculous wider “culture wars”. In its place comes proper engagement with one of the biggest structural challenges we all face – the impacts of a warming climate on our planet and on all of us. As can already be seen from the lifting of the stupid ban on onshore wind farms, to the approval for three big new solar farms, to the upcoming establishment of GB Energy, Labour seems to understand that things will need to be done differently to ensure all our futures, and seems intent on ensuring that the UK government is an active player in helping make the required changes happen.
From a business perspective, that will mean increased opportunities in directly helping make those initiatives happen, coupled with likely increased impediments and disincentives for those involved in the existing irresponsible ways of doing business (cough, fossil fuels). That is all at a macro level though, so for most businesses, the key thing will to be ready for when the government turns its attention to the micro. Remain fully committed to your sustainability strategy (or get one in place ASAP if you haven’t already), as Labour will be expecting business to be properly engaging with these challenges and adapting their business as necessary to address their environmental and social impacts. And that way, you’ll stand ready to take full advantage of the macro changes as they come onstream.
Get in touch
With so much change afoot, you may be unsure about how your business will be impacted. Our Client Legal Directors are well practised at horizon scanning and preparing businesses for regulatory and legislative changes. Working within your business, on a part time, flexible basis, they can support you at board level to navigate change and position yourself positively for the future. If you would like to find out more, please contact us on info@thelegaldirector.co.uk or 020 3056 8538.
