On 17 June 2024, Reform UK released its manifesto, “Our Contract With You”, which outlines the parties pledges should they win the election on 4 July. Below, we summarise the main proposals for employment law and HR and what they mean for employers.

Commitments to change the law

·       Lift the income tax starting threshold to £20,000.

·       Raise the National Insurance rate to 20% for foreign workers, but exempt essential foreign health and care workers, as well as businesses who employ five staff members and under.

·       Abolish IR35 rules.

·       Offer tax relief for organisations that undertake apprenticeships.

·       Replace the Equality Act 2010 and scrap diversity, equality, and inclusion rules.

·       Make St George’s Day and St David’s Day a public holiday.

·       Scrap thousands of laws that hold back British business and damage productivity, including employment laws, and make it easier to hire and fire so that businesses can grow.

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What would these changes mean?

Many of the pledges made by Reform UK lack sufficient detail to determine practically what they could mean for employers, other than payroll changes relating to tax and National Insurance.

If they do play a part in shaping the law as a result of the election, much will depend on which laws the party considers are holding back British businesses and damaging productivity. No insight is given on this in the manifesto itself, which means it’s difficult to determine what they actually have in mind. It could perhaps be laws such as those around the practice of dismissal and re-engagement. This has received a lot of attention over the last few years and will be subject to some restriction from 18 July 2024 when the new statutory Code of Practice on Dismissal and Re-engagement comes into force. Labour have already stated their intention to make further changes to restrict the ability to follow this process, so if this is what Reform UK have in mind, it may be difficult to affect that change.    

Reform UK has also pledged to replace the Equality Act 2010 and scrap diversity, equality and inclusion rules. What this would be replaced with has not been outlined; equality legislation existed in the UK long before 2010 and the appetite to replace it wholesale may well be slim in the next parliament.

Another pledge that could impact employers is making St George’s Day and St David’s Day a public holiday. Without further detail, it’s difficult to assess the impact that this could have. It could be that these days replace existing bank holidays, or they may be added as two additional regular public holidays. Whatever the impact is, it is likely to necessitate the changing of employment contracts and organisational policies. It could also mean changes to overall holiday entitlement. For example, where the employment contract provides for all bank and public holidays as leave, staff could get an additional two day’s leave. Alternatively, where bank and public holidays form part of the statutory minimum holiday entitlement, whilst it might not mean any additional days off, it could have the effect that two days of leave that an employee previously was able to take when they chose could become fixed for use on these two new public holidays, giving them less time that they can book in themselves.