Category: Practice Area

General election 2024: Liberal Democrats employment law manifesto

The Liberal Democrats have announced a proposal to add “caring” to the list of protected characteristics under the Equality Act. 

Carers already benefit from protection under the Equality Act. Coleman v Attridge Law confirmed the principle of discrimination by association, although a change in the legislation could refine and codify this area of law.

Details about how the Liberal Democrats would achieve this are presently limited, and it remains to be seen how “caring” would be defined for the purposes of the legislation.

Employees (including but not limited to those with caring responsibilities) are also already entitled to make flexible working requests, which can include increasing the time they work from home and seeking to alter their hours. Whilst the right to flexible working is currently limited to employees, amending the Equality Act could provide increased protection for workers with caring responsibilities.

Whatever the Government decides post-election, taking time out to care for a loved one can be emotive and challenging. Good communication between employers and employees can help reach an agreed-upon and workable way forward and reduce the risks of a dispute. Parties who are unclear about their rights or obligations should seek legal advice sooner rather than later.

Individuals with caring responsibilities or who have suddenly found themselves with caring responsibilities should check their employee handbook for any policies on taking time off to care for and attend appointments with their dependents. Similarly, it is good practice for employers to continue reviewing policies to ensure their employees are well supported should they need to care for dependents.

Trans and non-binary rights

The Liberal Democrats are pledging to strengthen the rights of trans and non-binary people. They would remove the need to obtain medical reports and recognise non-binary identities. Whether this would replace the current gender recognition certificates remains to be seen.

The Liberal Democrats would require large employers to monitor and publish data on gender, ethnicity, disability and LGBT+ employment levels, pay gaps and progression. Whilst likely to be anonymised, employers should exercise utmost caution when handling this data, as personal data revealing racial or ethnic origin and sexual orientation is treated as ‘special category data’ under GDPR and subject to special rules and safeguards. This requires data processors (in this case, the employer) to act within the scope of GDPR legislation, amongst other things, in ensuring that the processing of the special category data falls within one of the ten conditions under which processing is allowed (see Article 9 of the UK GDPR). Failure to comply with the GDPR requirements can result in potential claims by the data subjects (in this case, employees) and severe punitive sanctions by the regulator. The ICO and employers should seek advice on ensuring compliance with their various legal obligations and managing any overlaps between legal considerations.

Worker protection enforcement authority

Another area of note is the promise to create a new Worker Protection Enforcement Authority (“WPEA”). Presently, there are three Government bodies tasked with enforcing employment rights:

• Gangmasters and Labour Abuse Authority (“GLAA”)
• Employment Agency Standards Inspectorate (“EAS”)
• HMRC National Minimum Wage and National Living Wage team (“HMRC NMW”)

The GLAA issues licences to agencies supplying workers to the UK fresh produce sector and seeks to protect vulnerable and exploited workers. It also liaises with the police and NCA to prevent worker exploitation and criminal activity.

The EAS is responsible for protecting the rights of agency workers. It works with employment agencies and businesses to ensure compliance with the law and investigates complaints from agency workers.

HMRC enforces the national minimum wage on behalf of the government and encourages compliance with minimum wage legislation.

All three bodies work together alongside other enforcement agencies, and any new authoritative body would likely replace the existing three. Its responsibilities would include enforcing minimum wage legislation, tackling modern slavery, and protecting agency workers.

There are natural advantages to a unified body, including providing a clear source of assistance and information for individuals and businesses alike to approach, greater coordination between the civil and criminal enforcement units and more efficient use of resources.

Dependent contractor

The Liberal Democrats have also indicated that they would seek to introduce a new “dependent contractor” status, which would sit between employment and self-employment, granting the contractor basic rights, including minimum earnings levels, sick pay and holiday entitlement (see also Labour’s proposals on worker/employee distinctions here: Election 2024: What’s in store for employment law?

It is unclear how this new proposed status would interact with the existing status of workers or whether it is intended to replace it entirely.

National Insurance

The Liberal Democrats have said they will review the tax and National Insurance status of employees, dependent contractors, and freelancers to ensure “fair and comparable treatment.” What this will entail is unclear, but it will likely encompass IR35 reforms.

Flexible working

Labour and the Liberal Democrats mention flexible working in their manifestos and give the right to request flexible working to workers and employees alike. Following the reforms made to flexible working that came into existence on 6 April 2024, the right to request flexible working is now a day-one right afforded to all employees. Employers only have limited grounds to reject requests and a dismissal because an employee has made a flexible working request, which is deemed an automatically unfair dismissal.

The Liberal Democrats would also give “every disabled person the right to work from home if they want to unless there are significant business reasons why it is not possible.” However, it is unclear how this will be implemented, as the Equality Act 2010 already requires employers to make “reasonable adjustments” for disabled people (as defined under the legislation).

Family friendly rights

The Liberal Democrats, like Labour, are proposing to extend day-one rights for parental leave and pay.

In their manifesto, the Liberal Democrats say they would double statutory maternity and shared parental pay and increase statutory paternity pay to 90% of earnings during paternity leave. The increase to statutory paternity pay would be subject to a cap on high earners, but this cap has not been disclosed.

It is unclear whether the entitlement to paternity leave and pay would be extended to the new “dependant contractor” status. Currently, eligibility for paternity leave is limited to employees with no less than 26 weeks of service ending with the Qualifying Week (the 15th week before the baby is due) and taking time off to care for the baby or their partner. If the employee satisfies these conditions, they will be able to take up to two weeks paternity leave. However, the Liberal Democrats have indicated a desire to introduce “an extra use-it-or-lose-it month for fathers and partners”.

They pledge to give each parent six weeks of use-it-or-lose-it leave paid at 90% of earnings and 46 weeks of shared parental leave, which will be paid at twice the current statutory rate. The Liberal Democrats seem to accept that the state will fund these ambitions and that they will only be implemented once “the public finances allow.”

In the short term, should the party be elected, employers should consider the potential hurdles of covering an employee for an extended period while paying them 90% of their earnings, subject to any caps that may subsequently be imposed.

The Liberal Democrats have also proposed introducing paid neonatal care leave, but it is unclear how this will affect the incoming Neonatal Care (Leave and Pay) Act 2023. This Act, expected to come into force from April 2025, will create a statutory entitlement to neonatal care leave and pay. It should be noted that much of the details of this Act have yet to be determined, including the levels of pay, duration, and relationship requirements. However, it is likely to dovetail with parental bereavement leave provisions. However, it will be available to employees without a service requirement, providing that their child receives neonatal care (which has yet to be fully defined) within 28 days of birth.

The Liberal Democrats would also mirror Labour in making SSP available on the first day of sickness and aligning the rate with the National Minimum Wage.

Whilst not making it explicitly into their manifesto, the Conservatives have expressed a wish to protect the “privacy and dignity of women and girls” by defining sex as biological in the Equality Act 2010.

What does this mean for employers?

Presently, under the Equality Act, sex is not explicitly defined, but the protected characteristic of sex is covered by section 11, which states that:

“(a) a reference to a person who has a particular protected characteristic is a reference to a man or a woman;

(b) a reference to persons who share a protected characteristic is a reference to persons of the same sex.”

Sex is, therefore, under the current legislation, understood to be binary and the same as that recorded on an individual’s birth certificate. However, the legislation does not guide how individuals who have transitioned should be treated.

Whilst primarily focused on those changing gender, the Gender Recognition Act 2004 (“GRA”) attempts to clarify the status of those in possession of a gender recognition certificate (“GRC”). Section 9(1) GRA states that where a GRC is issued to a person, then:

“if the acquired gender is the male gender, the person’s sex becomes that of a man, and if it is the female gender, the person’s sex becomes that of a woman.”

However, section 9(3) adds a proviso that section 9(1) is subject to provisions made in any subordinate legislation. As the Equality Act fails to make clear that it triggers section 9(3), there remains a lack of clarity regarding the treatment of trans men and women.

As a result, there is still a grey area and a discrepancy between those who have a GRC and those who do not. With waiting times for NHS gender identity clinics now reaching more than five years, and combined with the requirement for individuals to provide evidence of living in their affirmed gender for two years, this process is lengthy and means that there are likely many people who never receive a GRC and the additional legal protections it confers.

Amending the act to clarify the definition of sex and to address questions about trans status could provide greater certainty to employers and service providers alike. The Equality and Human Rights Commission has also recommended that the “sex” should be defined as biological sex for the purposes of the Equality Act. In her letter to Ms Badenoch, the Chairwoman of the EHRC identifies 8 areas in which such a definition would provide clarity:

• pregnancy and maternity;
• freedom of association for lesbians and gay men;
• freedom of association for women and men;
• positive action;
• occupational requirements;
• single sex and separate sex services;
• sport; and
• data collection.

However, such a change would not be a definitive solution. Complexities around discrimination would not necessarily be eradicated by simply adding an explicit definition of sex within the Equality Act.

Both direct and indirect sex discrimination would be affected by the change as it would reverse potential claims, i.e. trans women would no longer be able to bring claims as women, thus transferring the right to bring a claim for sex discrimination.

Whilst sex may be defined as biological, having the effect of preventing individuals from bringing certain claims for discrimination, those who identify as trans are still going to be protected by the Equality Act. The Equality Act presently makes provision for nine protected characteristics, including:

• age;
• disability;
• gender reassignment;
• marriage and civil partnership;
• pregnancy and maternity;
• race;
• religion or belief;
• sex; and
• sexual orientation.

An individual will still be able to bring a claim in relation to any of these characteristics if they can demonstrate that they have been directly or indirectly discriminated against. Section 7 of the Equality Act defines that an individual is eligible for the protected characteristic of gender reassignment if they are “proposing to undergo, [are] undergoing or [have] undergone a process (or part of a process) to reassign the person’s sex by changing physiological or other attributes of sex”.

The employment tribunal in Taylor v Jaguar Land Rover Ltd considered the criteria to satisfy section 7. It was held that there was a broad range of scenarios under which an individual would be covered by the Act. It confirmed that there is no need for an individual to have undergone any surgical procedures and that an individual need only be “actively considering”, “intending to”, or “deciding to undergo gender reassignment” to be protected from discrimination. The case also highlighted that the courts are open to considering those who identify as non-binary or genderfluid as protected under the gender reassignment provisions of the Equality Act.

Whilst we do not know whether any changes will be made, we would recommend that it is best practice for employers to continue to keep their policies under review and updated to ensure that no group are being discriminated against. Employers are under a duty to take all reasonable steps to prevent discrimination. They should, therefore, consider whether there are further steps they could take to ensure that their workplace is fit and welcoming for all employees.

An employer may wish to take a range of actions, including consulting any transitioning individuals to understand their needs and concerns, encouraging sensible and understanding workplace behaviour, and conducting equality impact assessments before implementing new policies and procedures.