UK Employment Rights Bill to Impact Businesses with Up to £5bn Annual Cost

The proposed legislation aims to enhance worker protections but could impose significant financial burdens on small and micro businesses.

The Employment Rights Bill, under debate in Parliament, seeks to improve day-one rights for workers, including protections against unfair dismissal and bans on zero-hours contracts.
Government analysis estimates the cost to businesses could reach up to £5 billion annually, with small and micro businesses facing proportionately higher expenses due to administrative and compliance burdens.
Critics warn the legislation might lead to increased prices, job cuts, and reduced investment as businesses adjust to the new financial demands.
Supporters argue the reforms will promote fairness, boost productivity, and benefit workers, particularly in low-paid and insecure jobs, by providing more predictable working conditions.
Business groups have expressed mixed reactions, with some praising the focus on improving work standards, while others criticize the rapid implementation of numerous measures.