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Labour Law in the United Kingdom

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Are Legal Systems Converging or Diverging?

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Abstract

A vital and large segment of Employment law and social policy in the United Kingdom as it is today is, in many ways, a product of the influence of European Union social policy and the directives providing legislative protections for workers and employees. In particular, directives such as the Acquired Rights Directive and Collective Redundancies Directive have introduced concepts and led to implementation efforts that have given rise to controversy at an EU level. This can partly be laid at the feet of the UK as a common law country, whereas European law tends to reflect civil law tendencies.

Moreover, the controversies can also be attributed to the UK’s far more neo-liberal economic outlook to the operation and regulation of the labour market that is in contrast to many EU Member States. While the UK does boast of some of the most generous employee rights, such as maternity leave and pay, those entitlements deriving from the EU that tend to interfere with the freedom of businesses to operate as they see fit in relation to their employees, have tended to meet more resistance.

Although employment law has not changed significantly in the last twenty years, apart from a key procedural change increasing continuous service requirements (to be able to rely on a number of employment rights) and the introduction of fees in employment tribunals, the COVID 19 crisis has seen a number of temporary changes that have sought to protect employment security and the economy as a whole, such as the furlough scheme and a variety of grant and loan opportunities. Like most of the EU during the 2020 crisis, the UK adopted its own means of dealing with the immediate needs of the crisis, which reflects the isolationist tendencies it has exhibited since the country voted to leave the European Union.

This latter event is going to be a key driver in future changes to employment law. Although there are already mechanisms in place to maintain the current droits acquis of the EU, since the UK left the EU, there has been nothing to prevent the government from retrenching many of the more controversial employee rights, such as those derived from the Acquired Rights Directive and the Collective Redundancies Directive, which have caused confusion and consternation when it comes to their perceived adverse impact on businesses. Discussions in the Westminster Parliament have alluded to this on numerous occasions so, in short, it is only a matter of time.

This chapter will explore the development of employment law over the last 20 years, examining the derivation of the laws that are commonly a part of an employment law framework and how they have evolving in line with the changing paradigm of the UK government. In particular, this chapter will focus on EU-derived law and the likely impact on this of the UK’s withdrawal from the European Union.

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Notes

  1. 1.

    This sense of perennial crisis has been documented by labour law scholars: see Ewing (1988); Hyde (2011).

  2. 2.

    See the European Pillar of Social Rights, proclaimed in 2017, proclamation-pillar_en.pdf (europa.eu) and the European Pillar of Social Rights Action Plan, EUROPEAN PILLAR; SOCIAL RIGHTS; ACTION PLAN (europa.eu).

  3. 3.

    See Blyth (2013).

  4. 4.

    For evidence generally supporting the claim that enforcement has been marginalised, see Dickens (2012); Barmes (2016); Busby and McDermont (2012, 2020).

  5. 5.

    For a discussion of the areas where the EU has expanded the labour law and social policy acquis, see Sect. 3 below: e.g. the Whistleblowing Directive and the proposed EU Pay Transparency Directive.

  6. 6.

    See Antokolskaia (2006), pp. 21–23; Lohse (2011), p. 291.

  7. 7.

    Nelken (2002), pp. 26–27.

  8. 8.

    See Gilson (2004), pp. 132–137; Gilson (2001), pp. 332–336; La Porta et al. (2000), p. 20.

  9. 9.

    See Gordon (2004), pp. 137–140; Gilson (2001), pp. 337–339; Clarke (2016), pp. 25–26; Gordon (2018), pp. 29–34.

  10. 10.

    See the discussion in Barnard and Deakin (2002).

  11. 11.

    This is a common criticism of labour laws. See the following literature: Edmans et al. (2014); Bradley et al. (2014); Avdagic (2015); Deakin et al. (2014a, b).

  12. 12.

    See the Beecroft Report for the UK Coalition Government: The Beecroft Report, https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/31583/12-825-report-on-employment-law-beecroft.pdf.

  13. 13.

    Principally restricted to minor reforms centred around protections for transferring workers when the business of their employer is sold or transferred, and increasing the qualifying period from one to two years for unfair dismissal claims and the consultation periods on planned collective redundancies: see the Unfair Dismissal and Statement of Reasons for Dismissal (Variation of Qualifying Period) Order 2012 (SI 2012/989), Article 3(2) of the Trade Union and Labour Relations (Consolidation) Act 1992 (Amendment) Order 2013 (SI 2013/763) and the Collective Redundancies and Transfer of Undertakings (Protection of Employment) (Amendment) Regulations 2014 (SI 2014/16).

  14. 14.

    For the distinction between enforcement of, and compliance with, labour laws, see Davidov (2021), pp. 118–119; Davidov and Eshet (forthcoming, 2022), pp. 1–3.

  15. 15.

    The Employment Tribunals and the Employment Appeal Tribunal Fees Order 2013 (SI 2013/1893). See the discussion in Davidov (2021), pp. 118–119.

  16. 16.

    See the research by Adams and Prassl (2017).

  17. 17.

    This included unfair dismissal, discrimination, and equal pay claims.

  18. 18.

    The Employment Tribunals (Constitution and Rules of Procedure) Regulations 2013 (SI 2013/1237) rules 39 and 53.

  19. 19.

    See Mangan (2013), pp. 413–414.

  20. 20.

    ACAS is an organisation that is autonomous from the UK Government. It has a statutory duty to promote the improvement of industrial relations, part of which entails the provision of conciliation and arbitration services in respect of the resolution of individual and collective disputes between employers and their employees and/or trade unions: Section 209(1) of TULRCA and for commentary, see Dickens (2012).

  21. 21.

    Section 18A(3) of the ETA. The prescribed period is one calendar month in terms of para 6 of Schedule 1 to the Employment Tribunals (Early Conciliation: Exemptions and Rules of Procedure) Regulations 2014 (SI 2014/254).

  22. 22.

    Hepple (2013), p. 218.

  23. 23.

    Section 18A(4) and 18A(8) of the ETA. For a trenchant critique of this pre-claim conciliation procedure, see Renton (2012), pp. 139–140.

  24. 24.

    Wilmot-Smith (2019).

  25. 25.

    [2020] AC 869.

  26. 26.

    [2020] AC 869, 904F-H and 906D-E per Lord Reed.

  27. 27.

    [2020] AC 869, 889G-890D per Lord Reed. See also the statistics discussed in Adams and Prassl (2017), pp. 416–420.

  28. 28.

    [2020] AC 869, 890B per Lord Reed.

  29. 29.

    Marshall (2014).

  30. 30.

    In effect, each of these overhauls of employment law amounted to a form of internal devaluation of the Greek, Italian, Spanish and Portuguese economies to incentivise investment to the extent that external devaluation of the Euro as a currency was impossible.

  31. 31.

    OECD (2013), p. 67.

  32. 32.

    Ibid.

  33. 33.

    See OJ 2021 L 149/10.

  34. 34.

    2019/1152/EU (OJ 2019 L186/105).

  35. 35.

    Article 1(3). For a comprehensive account of the provisions of the TPWCD, see Bednarowicz (2019); Roisin (2021), pp. 158–159.

  36. 36.

    Articles 4(2), 5 and 7 and Bednarowicz (2019), pp. 616–617.

  37. 37.

    Articles 8, 10, 11 and 12 and Bednarowicz (2019), p. 619.

  38. 38.

    Article 9 and Bednarowicz (2019), p. 619.

  39. 39.

    See the Employment Rights (Miscellaneous Amendments) Regulations 2019/731, amending sections 1 to 7B of the Employment Rights Act 1996 (‘ERA’), with effect from April 2020.

  40. 40.

    Section 27A of the ERA, introduced by the Small Business, Enterprise and Employment Act 2015.

  41. 41.

    See Good Work: One-Sided Flexibility (2019), https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/818674/Good_Work_Plan_one_sided_flexibility-consultation_.pdf.

  42. 42.

    See Article 387 of the EUUKCA. The EU has the power to take appropriate rebalancing measures if there is too much formal divergence in labour and social standards.

  43. 43.

    2019/1937/EU (OJ 2019 L305/17).

  44. 44.

    The Public Interest Disclosure Act 1998 (‘PIDA’), whose provisions amended the terms of the ERA.

  45. 45.

    Article 4. See Abazi (2019), pp. 647–648; Gerdemann and Colneric (2021), pp. 199–200.

  46. 46.

    See section 43K ERA.

  47. 47.

    See section 43B(1) ERA.

  48. 48.

    Articles 2 and 5(1) and (2). See Abazi (2019), pp. 646 and 648; Gerdemann and Colneric (2021), pp. 196–198.

  49. 49.

    See Recital 32 and Articles 5(2) and 6(1). See Abazi (2019), p. 648; Gerdemann and Colneric (2021), pp. 201–202.

  50. 50.

    Both the WD and the PIDA apply to the public sector.

  51. 51.

    The WD is restricted to private sector organisations employing 50 or more employees, with the exception of entities in the financial services industry: see recital (48) and article 8(3) WD. For discussion, see Gerdemann and Colneric (2021), p. 195; Abazi (2019), pp. 646; 650.

  52. 52.

    See Articles 6(1)(b) and 7–13 of the WD and sections 43C to 43J of the ERA. For analysis, see Abazi (2019), pp. 649–653; Gerdemann and Colneric (2021), pp. 201–207.

  53. 53.

    See Article 19 and Gerdemann and Colneric (2021), pp. 255–258; Abazi (2019), p. 648.

  54. 54.

    See sections 47B and 103A of the ERA.

  55. 55.

    See COM(2021) 93 final, https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:52021PC0093&from=EN. See also Common Position document, pdf (europa.eu).

  56. 56.

    SI 2017/172.

  57. 57.

    Public sector employers with 250 employees or more are covered by The Equality Act 2010 (Specific Duties and Public Authorities) Regulations 2017 (SI 2017/353).

  58. 58.

    See COM(2021) 93 final, Articles 3(1) and 8(1), https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:52021PC0093&from=EN.

  59. 59.

    Kwarteng et al. (2012).

  60. 60.

    In particular, the following employment rights found in the Working Time Regulations 1998 (SI 1998/1833) (‘WTR’) were slated for removal: (i) the 48-hour working week limit (see regulation 4(1) of the WTR and article 6(b) of Directive 2003/88/EC of the European Parliament and of the Council of 4 November 2003 concerning certain aspects of the organisation of working time O.J. L 299 (‘WTD’)); (ii) the inclusion of overtime pay when calculating paid holiday under regulations 13–16 of the WTR and article 7 of the WTD (see East of England Ambulance Service NHS Trust v Flowers [2019] IRLR 798, Patterson v Castlereagh Borough Council [2015] IRLR 721 and Dudley Metropolitan Borough Council v Willetts [2017] IRLR 870); (iii) the requirement for businesses to log employees’ working hours (see Federacion de Servicios de Comisiones Obreras v Deutsche Bank SAE [2019] 3 CMLR 32).

  61. 61.

    See Mangan et al. (2020).

  62. 62.

    See The Coronavirus Act 2020 Functions of Her Majesty’s Revenue and Customs (Coronavirus Job Retention Scheme) Direction.

  63. 63.

    Mangan et al. (2020), pp. 334–339.

  64. 64.

    Paragraph 6.1(a) of the Coronavirus Act 2020 Functions of Her Majesty’s Revenue and Customs (Coronavirus Job Retention Scheme) Direction directed that employees or limb (b) workers must ‘cease all work in relation to their employment’.

  65. 65.

    By October 2020, the 80% threshold had dropped to 60%.

  66. 66.

    For the relationship between nationalism, protectionism and populism in the context of comparative labour law, see Campbell (2021).

  67. 67.

    See Pontusson (2013), p. 800; Charlwood (2004); Blanchflower (2007); Raday (2002).

  68. 68.

    For the traditional power of national trade unions in shaping labour laws and the relationship with corporate governance, see Gourevitch and Shin (2005); Pargendler (2021), p. 536.

  69. 69.

    DiMaggio and Powell (1983), p. 150.

  70. 70.

    See Hansmann and Kraakman (2001), p. 450; Rasheed and Yoshikawa (2012).

  71. 71.

    See Corby and Latreille (2012).

  72. 72.

    See DiMaggio and Powell (1983), p. 150; Hansmann and Kraakman (2001), p. 450.

  73. 73.

    DiMaggio and Powell (1983), pp. 152–154.

  74. 74.

    For a discussion of the ‘demutualisation’ strategy, see Countouris and Freedland (2013), pp. 7–9.

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  1. The University of Edinburgh, Edinburgh Law School, Edinburgh, UK

    David Cabrelli

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    Emilie Ghio

  2. Fluminense Federal University, Rio de Janeiro, Brazil

    Ricardo Perlingeiro

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Cabrelli, D. (2024). Labour Law in the United Kingdom. In: Ghio, E., Perlingeiro, R. (eds) Are Legal Systems Converging or Diverging?. Springer, Cham. https://doi.org/10.1007/978-3-031-38180-5_6

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