There are approximately 5 million limited companies in the UK, and between January and March 2024, there were 24.85 million full-time employees and 8.15 million part-time workers. Regulations in UK employment protect both employers and employees. These laws, which cover dismissal, holidays, pay, discrimination, and other issues, protect workers’ rights while also protecting employers’ interests and maintaining a fair relationship between the two.
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Overview of UK Employment Law
At first glance, UK employment laws may appear complex and varied, particularly for business owners who must navigate UK employment law while continuing to run and grow their day-to-day operations.
Furthermore, employment laws in the UK (of which there are many) exist to protect businesses by outlining their obligations to their employees and the protections they have as business owners. They keep the employment relationship fair for both parties.
For example, UK employment laws protect organisations by establishing guidelines for what should be included in a contract, such as holiday entitlement, pay, working hours, and formal notice periods. Contracts protect employers by providing clarity and a reference point to ensure that both the employee and the employer are on the same page.
Employees are also protected by UK employment laws, which cover everything from hiring practices to workplace conduct and fair pay. For example, in the United Kingdom, businesses must pay the National Minimum Wage based on a staff member’s age, while all employees over the age of 21 are entitled to the National Living Wage.
The Equality Act of 2010 protects employees from the moment they enquire about a job, prohibiting discrimination against candidates (and employees) based on one of nine protected characteristics, including gender, race, or disability. When a new employee joins the team, they are also protected by Health and Safety laws outlined in the Health and Safety at Work Act 1974. These ensure that all employees have the right to a safe work environment.
What does UK Employment Law Cover?
Employment law is a broad area of the legal system that addresses a wide range of issues related to the employment relationship, primarily governing processes and policies that can be implemented.
Because employment law covers such a broad range of topics, compiling an exhaustive list of all the areas in which it is involved would take up a very long page!
But some of the most common areas that you’re probable to come into contact with as a company owner include employment contracts, equal pay, holiday access and pay, working hours, grievance procedures, disciplinary processes, maternity and paternity leave, different types of discrimination, diversity and equality in the workplace, reasonable modifications for employees with disabilities, redundancy process and much more.
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What is Discrimination in the Workplace?
Discrimination in the workplace refers to the unfair treatment of an employee based on their possession of particular protected characteristics.
The protected characteristics are outlined in the Equality Act 2010. They are:
- Sex
- Race
- Marriage and civil partnership
- Sexual orientation
- Age
- Religion or belief
- Pregnancy and maternity
- Gender reassignment
- Disability
Discrimination against any employee based on any of their protected characteristics is illegal and may result in a discrimination claim against your company. In UK employment law, there are usually four types of discrimination: direct, indirect, harassment, and victimisation.
Direct discrimination occurs when someone is treated unfairly (for example, not promoted) because they have a protected characteristic.
Indirect discrimination refers to any policies, rules, or procedures that your company has in place that may disadvantage a specific group of people due to protected characteristics. A good example would be prohibiting employees from wearing head coverings, which would have a negative impact on some Muslims. To defeat a claim of indirect discrimination, an organisation must be able to justify the rule, such as claiming that the rule was in place due to health and safety concerns about machinery.
Harassment is defined as unwanted conduct that is related to someone’s protected characteristic and has the intent or effect of violating the person’s dignity; or making the workplace intimidating, hostile, degrading, humiliating, or offensive to that person.
Victimisation is defined as mistreating someone because they filed a claim under the Equality Act, provided evidence in support of a claim, or engaged in any other activity related to the Equality Act. For example, refusing to promote someone because they provided a witness statement in support of the claim made by the Jewish colleague mentioned above.
Finally, employers are required to make reasonable adjustments to any physical feature or practice/policy that places a disabled employee at a significant disadvantage when compared to employees who are not disabled.
What are the Employment Laws in the United Kingdom?
There are numerous employment laws in the UK that govern various aspects of how you should conduct business and act as an employer. Some of them will be very familiar to you because you encounter them on a regular basis, while others you may only come into contact with on occasion.
Some of these laws will specifically address workplace equality issues, which are critical to avoiding discrimination claims, as outlined above. Others are more concerned with ensuring the safe and effective operation of your business.
Here, we highlight some of the major employment laws that affect UK business owners, as well as provide a brief overview of their scope. Consider it a quick guide to essential employment legislation.
- Employment Rights Act 1996
- Employment Relations Act 1999
- Maternity and Parental Leave etc. Regulations 1999
- National Minimum Wage Act 1998
- Part-Time Workers (Prevention of Less Favourable Treatment) Regulations 2000
- Transfer of Undertakings (Protection of Employment) Regulations 2006
- The Working Time Regulations 1998
- Equality Act 2010
- The Carer’s Leave Act 2023
- The Protection from Redundancy (Pregnancy and Family Leave) Act 2023
- Employment (Allocation of Tips) Act 2023
Final Words
UK employment law can be complex. Individuals may be classified as employees, workers, or independent contractors. While independent contractors do not have employment rights, workers have the right to some (but not all) of the same protections as employees.
