Labour’s flagship Employment Rights Bill has cleared its final parliamentary hurdle on Tuesday and is on course to receive Royal Assent before Christmas, bringing an end to weeks of parliamentary deadlock and uncertainty for retailers and employers.
The breakthrough came after Conservative peer Lord Sharpe, the shadow business and trade minister, withdrew a last-minute amendment during the bill’s final stage of ‘ping-pong’ in the House of Lords.
The move removed the final obstacle to the legislation’s passage, allowing it to complete its journey through Parliament.
Prime minister Sir Keir Starmer termed the development as a “major victory for working people in every part of the country”, describing the bill as “the biggest upgrade to workers’ rights in a generation”.
Once enacted, the legislation will apply across England, Scotland and Wales, but not Northern Ireland. Most of its measures will require secondary legislation before coming into force, meaning the practical impact on employers will be phased in over time.
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Key provisions include access to statutory sick pay and paternity leave from day one of employment, new protections for pregnant women and new mothers, and reforms aimed at strengthening workers’ rights and job security. The government has also committed to banning what it describes as exploitative zero-hours contracts, replacing them with a right to guaranteed hours.
Last month, the government watered down its original proposal for day-one unfair dismissal rights, following talks with businesses that had warned that initial proposals would make hiring more difficult. Instead, the bill introduces enhanced protections after six months’ employment – a compromise welcomed by business groups concerned about recruitment flexibility and tribunal pressures.
In a joint statement issued earlier on Monday, business organisations including the British Chambers of Commerce and the Federation of Small Businesses said they continued to have concerns about aspects of the bill, but urged Parliament to pass the legislation in order to preserve the six-month qualifying period for unfair dismissal claims.
Joanne Thomas, chair of the Trade Union and Labour Party Liaison Organisation (TULO) and general secretary of Usdaw, said the legislation had passed “despite Tory Lords’ best attempts to derail it”.
She said the measures – including guaranteed-hours contracts, day-one sick pay and stronger union rights – would “rebalance the world of work, putting power back into the hands of working people”.
Thomas stressed that the focus would now shift to implementation. “The work is not yet done. We need to make sure these rights are implemented properly,” she said, adding that further policies promised under Labour’s New Deal for Working People still needed to be delivered.