𝓤𝓷𝓲𝓽𝓮𝓭 𝓝𝓮𝔀𝓼

Employers deluged by a “tsunami of cost pressures” have issued a plea for the Government to water down new workers’ rights legislation returning to Parliament this week. The House of Lords has added a series of business-friendly amendments to the Employment Rights Bill, and is due to debate it again on Wednesday.

But there are fears the Government will use its Commons majority to remove the changes when it is next debated by MPs. The British Chambers of Commerce, British Retail Consortium, CBI and UKHospitality have all spoken out. Jane Gratton, deputy director public policy at the British Chambers of Commerce, said: “There are some aspects of the Bill which are very worrying for employers. We urge the Government to act on the concerns being raised.

“Reducing costs and barriers, and boosting competitiveness for business, must be a priority for government if the UK is to achieve the sustained growth we all want to see.”

The legislation is championed by Deputy Prime Minister Angela Rayner, who called it “the biggest upgrade to workers’ rights in a generation”. But an impact assessment produced by the Government warned it would impose direct costs on business of up to £5billion. Firms might simply absorb this in the form of lower profits, but it could also lead to higher prices, lower wages or fewer jobs, the analysis warned.

A survey by the British Retail Consortium found more than half of human resources directors in retail said the Bill would result in reduced headcount.

Changes introduced in the Lords include reinstating a rule that strike action can only take place if at least 50% of eligible union members take part in a ballot. The Government’s original version of the Bill allowed industrial action if a simple majority voted for it, regardless of turnout.

The Lords also modified plans to force employers to pay staff if a shift is cancelled at short notice, by adding that only 48 hours notice is required.

Other changes included changing the proposed right of employees to have guaranteed hours, effectively outlawing zero-hour contracts, to a right to request guaranteed hours.

And the Lords said the Government must take into account the fact that some work is seasonal and staff will only be needed for parts of the year, such as in the tourism industry or agriculture.

Ms Gratton said: “It’s critical that the Government achieves the right balance in this legislation. It must be proportionate, affordable and right for both firms and their employees. There’s a chance to do this by adopting some of the Lords’ amendments.”

UKHospitality, representing restaurants, bars, pubs and hotels, warned that 89,000 jobs had already been lost since last year’s Budget. Chairwoman Kate Nicholls said: “Hospitality businesses are still battling a tsunami of cost pressures, not least the £3.4billion in additional annual cost that hit the sector in April.”

Helen Dickinson, chief executive of the British Retail Consortium, said: “Many of the Lords’ amendments are good. They would help to protect thousands of valuable, local, part-time entry-level jobs. Ignoring them when the Bill returns to the Commons undermines the Government’s plans to get Britain working again.

Matthew Percival, CBI work and skills director, said: “While business backs the objectives of the Employment Rights Bill, there are significant fears that the way it is being delivered could backfire.”

Mr Percival said the Lords amendments “would improve the Bill”, but even as amended it would have “unintended consequences that make it a clear constraint on growth”.

Tories warned the legislation was a “Trojan horse” that would kill jobs. Andrew Griffith, Shadow Business and Trade Secretary, said: “It will price people out of jobs, deter investment and push businesses into a corner. It is a blueprint for less employment, more strikes, lower growth and working people will once again be left paying the price of Labour.”

A government spokesperson said: “We are ushering in a new era of partnership which sees employers, unions and Government working together as we deliver our landmark Employment Rights Bill to benefit more than 15 million workers in the UK, as part of our Plan for Change.

“We will work closely with employers to ensure new laws work for them as well as delivering significant benefits, potentially worth billions of pounds per year, with evidence showing that healthier and happier workers are more productive.”