As the Employment Rights Bill made its way to the House of Lords with significant government amendments, Parliament approved the neonatal care leave regulations. The government issued a consultation paper on ethnicity and disability pay gap reporting.
Meanwhile, the Court of Appeal had comments on whether an employee’s lack of “insight” into misconduct made a dismissal reasonable. On the facts of the case, it didn’t.
Chapter 1 - Full steam ahead
The Employment Rights Bill completed its House of Commons stages and is now in the Lords. It’s been heavily amended since the government introduced it, reflecting the outcome of consultations. The key changes include:
- Applying the new right for zero and low hour workers to be offered a guaranteed hours contract to agency workers. The duty will be on the end user hirer in most cases. The provisions are extremely complicated and there’s limited detail about how they will work in practice.
- Confirming that SSP for low paid workers will be paid at 80% of normal earnings if that is less than the normal flat rate.
- Accepting the principle that employees should be entitled to bereavement leave after pregnancy loss. The government will amend the Bill to reflect this.
- Adjusting the original proposals on collective redundancy consultation. If dismissals take place across different establishments, a higher threshold of dismissals will apply before consultation is triggered. The threshold will be set out in regulations.
- Introducing record keeping obligations to show compliance with annual leave requirements in the Working Time Regulations.
Next steps
- The Bill starts its Committee stage in the House of Lords on 29 April, so it seems likely that it will get Royal Approval before the summer recess.
- Until the government publishes the detail in underlying regulations, we won’t have a clear picture of what employers might do to prepare.
- Click here to watch Stefan Martin discussing the Bill with Hogan Lovells’ Director of Legislative Affairs, Nikki Da Costa.
Chapter 2 - Neonatal care leave in force as planned
Parliament has approved the regulations governing neonatal care leave and the right will come into force for parents of babies born on or after 6 April as planned. In broad terms, employees will qualify for a week of neonatal care leave for every complete week a baby spends in neonatal care, up to a maximum of 12 weeks. The neonatal care must begin within 28 days of birth. Neonatal care leave is a day one right, but neonatal care pay is subject to service and minimum pay requirements.
Next steps
- You can read about the new right in more detail here and watch our Employment Bite about neonatal care leave here.
- Employers should implement a neonatal care leave policy or amend existing family-friendly policies, as necessary.
- Ensure that managers are aware of the new right, and in particular the fact that employees do not have to give advance notice that they will be taking the leave while their child is receiving neonatal care.
Chapter 3 - Ethnicity and disability pay gap reporting
The government is preparing an Equality (Race and Disability) Bill to extend existing gender pay gap reporting obligations to ethnicity and disability pay gaps. Before publishing the Bill, the government is consulting on the detail, including:
- Requiring employers with 250 or more employees to report ethnicity and disability pay gaps against the existing metrics (mean and median pay gaps, bonus pay gaps and employee distribution by pay quartile) and reference dates;
- Introducing an obligation to provide a breakdown of a workforce by ethnicity and disability, including the percentage of employees that choose not to disclose;
- Reporting by reference to the ethnicity classifications used in the 2021 census and the Equality Act definition of disability; and
- Mandating that for confidentiality reasons, each group being analysed should contain at least 10 individuals, which may mean aggregating different groups.
Next steps
- The consultation closes on 10 June 2025.
- Employers may want to comment on whether they should be required to prepare action plans outlining what they are doing to improve workplace equality for ethnic minority and disabled employees.
Chapter 4 - Insight into misconduct and its relevance to an unfair dismissal claim
Hewston v OFSTED was a straightforward unfair dismissal claim. Mr Hewston was a school inspector who was dismissed for touching a child on the head and shoulder during an inspection. There was no suggestion that there was any improper motivation behind his actions, which were described by the Court of Appeal as “a friendly act of sympathy and assistance” after a wet child entered the school having been caught in heavy rain.
The EAT, upheld by the Court of Appeal, found that the dismissal was unfair because Mr Hewston had not been told or warned that he might be dismissed for a single incident of touching that did not raise a safeguarding concern. It would not have been obvious to him that his conduct could lead to dismissal in the absence of a “no touch” policy or guidance.
That’s legally uncontroversial. The more interesting aspect relates to OFSTED’s view that Mr Hewston’s lack of insight into his behaviour – he had not accepted that he had done anything wrong – made the dismissal fair, even if the underlying misconduct did not merit dismissal.
The Court of Appeal said that normally an employee’s failure to show proper contrition or insight will not make it reasonable to increase the sanction. Disciplinary proceedings are not “conducive to calm self-reflection” and an employee may be reluctant to say they will not act in the same way in future if that implies guilt. Although there may be cases where a lack of insight poses a real risk that the employee will commit more serious misconduct in the future, this was clearly not the position here.
Next steps
- Disciplinary managers should consider whether an employee should have realised that their conduct could lead to dismissal before deciding to dismiss.
- If the answer to that question is no, think carefully before relying on the employee’s failure to show contrition or insight as a reason to increase the disciplinary penalty.
