Only 3% of business leaders think Lords will back down on employment rights bill, survey shows

UK businesses are bracing for renewed uncertainty as the Employment Rights Bill (ERB) returns to the House of Lords today, with new research suggesting there is little confidence in a quick solution.

A survey by compliance firm VinciWorks found that just 3 per cent of senior HR, compliance and business leaders believe the Lords will back down on their opposition to key provisions in the legislation, including day one employment rights and proposed changes to trade union rules.

The survey, which collected responses from 190 HR and compliance professionals, CEOs and in-house counsel, reveals deep concern across the UK industry. One in five respondents expect the legislation to fail entirely, while 12% believe the government will resort to using the Parliament Act, a move that would delay implementation until at least next year. A further 40 per cent expect a compromise between the Lords and Commons, an outcome that ministers have so far been unwilling to accept.

Nick Henderson Mayo, head of compliance at VinciWorks, warned that the government’s stance risks prolonging instability for employers. He said ministers were “painting themselves into a corner” by refusing to negotiate, despite the broad scope of the reforms. “The draft labor rights law is the biggest change in workers’ rights in decades,” he noted. “Employers deserve to have their voices heard on proposals that will be very difficult to implement.”

The opposition in the House of Lords is focused primarily on the government’s push to extend unfair dismissal protections to the first day of work, along with wide-ranging provisions for zero-hours workers and rules governing political donations to trade unions. With a large majority expected to vote against the government again, many employers say they are still stuck in a regulatory limbo.

VinciWorks’ findings show widespread concern about the bill’s broader implications. Nearly 60 percent of respondents believe they will need to strengthen workplace sexual harassment policies, while two-thirds say they will have to introduce new employee training programs to prepare for the sweeping changes contained in the ERB. However, many say they cannot go ahead with these plans while the dispute over unfair dismissal rules continues.

Henderson Mayo noted that even previous Labor governments had accepted the need for a qualification period for unfair dismissal. “The Employment Protection Act of 1975 reduced the qualification period to six months. Today it is two years. There is clearly room for adjustment and time for companies to prepare.”

The government has already launched multiple consultations on elements of the bill, including proposals affecting the rights of pregnant women and new mothers, as well as requirements for menopause action plans. But with nearly one in five business leaders believing the bill could fail completely, many fear they are investing time and money preparing reforms that could end up being abandoned.

“Employees and bosses want confidence in the hiring system,” Henderson Mayo added. “If the government and Parliament cannot reach a compromise, it raises the possibility that the rules will be rewritten again in a few years. The ERB is important – but perhaps it is time for some mature governments.”