Employment Rights Bill

Debate between Lord Phillips of Worth Matravers and Baroness Lawlor

Report stage
Wednesday 16th July 2025 Lords Chamber

[Lord Phillips of Worth Matravers (CB)]

If there is not to be a sensible probation period, is any employer going to have the courage to take on an ex-offender?

[Baroness Lawlor (Con)]

My Lords I support the amendments in this group because they would mitigate the potential damage to employment from the perspective of both the employer and the employee, whether that employee is a jobseeker or someone recently appointed. The danger exists particularly in this clause. As your Lordships know, Clause 23 and the linked Schedule 3 repeal Section 108 of the Employment Rights Act 1996. They remove the qualifying period of employment and make further amendments to the Act in respect of the repeal.

Section 108 stipulates that the protection under Section 94 of the Act, which establishes the right not to be unfairly dismissed, subject to certain conditions, does not apply to the dismissal of an employee unless he has been continuously employed for two years. During this two-year extended training period—for that is what it is, and I speak as an employer—when you induct a new employee, you know that if they do not work out, and there are clear headings governing this under law, they can be let go without unfair dismissal claims.

Now, that is to be removed by Clause 23 and Schedule 3. We are repealing Section 108 of the 1996 Act, one of the basic building blocks of employment law in this country. This is one of the most familiar and important pieces of legislation for the labour market. As my noble friend Lord Sharpe and the noble Lord, Lord Vaux of Harrowden, have said, it helps offer protection to both parties. It makes for a fluid labour market and avoids the zombie businesses which do little for the wider economy and militate against growth.

I will not go through each of the amendments because noble Lords have heard about them already, but they would facilitate good working practices for both parties. Those looking for a job would be more likely, as we have heard, to be appointed. There will be more job vacancies, which, as we know, have sadly fallen and continued to fall over the last year. Those looking for a job would be more likely to find one and more likely to start their first job, as we have already heard today. The employer would be able to take a risk, as we have heard today—to take a chance on a new employee.

Taking on a new employee involves a great commitment. It involves the commitment not only of a salary, which is only a small fraction of the cost, but of time, training, patience, showing the ropes and bringing someone into the culture of the organisation, so that they can contribute as a happy, contented, productive and effective member of the team. With this clause, we will not have the protections of that. I cannot think of any small employer who will not think twice about taking on a new person, and this will have very bad effects on the economy and growth.

We know there are legal grounds already for unfair dismissal in respect of the job itself. They include conduct, capability, redundancy, legal restrictions on employment and other substantive reasons. Noble Lords have spoken about these today, but there are cast-iron reasons for not being unfairly dismissed. You cannot be dismissed as a whistleblower or for discrimination, and these do not require the two-year qualifying period. The law takes care of this.

Now, with the removal of the two-year period goes the protection for the employer and the opportunities for new employees particularly, but also for many employees who want to change jobs and start a new walk of life. They may find they are not so good at what they were doing and want to try their hand at a new job. They need time to settle in, just as the new person coming into their first job does.

I am not at all convinced that this initial period, which Ministers have told us will have a lighter touch in respect of unfair dismissal arrangements, will actually be very helpful. Some law firms fear that it will impose pretty much the same strictures on an employer. We really need to know from the Minister what exactly the period will be and what the arrangements for unfair dismissal during that period will be, because I cannot see how we can have a Bill setting all this out when we do not know what is intended.

Like other noble Lords, I would value some statement. I do not need to refer to the compliance cost, the impact assessment that estimates hundreds of millions of pounds, or the additional complexity in the recruitment process. Added to the other measures in the Bill, Clause 23 and Schedule 3 add a new dimension of insecurity.

If we are to have businesses, particularly small businesses, willing to grow, to raise productivity as the Government want and to hire the new employees needed to raise that productivity, the Government should welcome Amendment 49 and all the amendments in this group. They accept the spirit of the manifesto pledge and go some way in helping the Government to get out of the mess, which is of their own creation.