The Employment Rights Act 1996 - A Summary of What It Is About

What is the Employment Rights Act 1996?

The 1996 Employment Rights Act lays out the rights of workers in the United Kingdom.

The Act updated a range of previous employment legislation dating from the 1960s, as well as the Employment Protection Act of 1975 and the Wages Act of 1986.

Some of the formal rights introduced in the 1996 Act were previously already in existence through individual company’s own employment contracts.

A number of the original provisions of the Employment Rights Act of 1996 have since been further amended by both the ensuing Labour and Conservative governments, so to further enhance protections for employees in the workplace.

Why was the 1996 Employment Rights Act introduced?

The 1996 Act was introduced by the then Conservative government so to consolidate previously established employment rules into one main labour Law, and to further extend personal rights to all workers, through the additional protections of the law.

The 1996 Employment Rights Act amalgamated much previous employment law into one Act.

Employment Rights Act 1996 Summary

The below contains a summary of the original main provisions of the 1996 Employment Rights legislation, some of which have since been further tightened as per the amendments listed in the Section further below.

Contract of Employment
The original 1996 Act determined that a contract of employment should be provided within two months of starting a new job. That contract, or ‘written statement of particulars’, must outline important information such as job title, wage, hours of work and employment duration (if the contract is for a fixed time-frame). That contract needs to be signed by both the employer and the employee..

Rest Breaks
Under the Employment Rights Act 1996, employees became formally entitled to daily and weekly rest breaks. On a daily basis, the Act required a break of least 20 minutes for people who work over six hours consecutively.

Parental Leave
This Act included provision for antenatal care, up to 52 weeks of maternity leave and at the time a minimum of one week of paternity leave.

Long Service
Under the 1996 legislation, employees who had worked for the same employer for an extended period of time became entitled to more benefits. For example, after six months employees were now entitled to ask for flexible working, after 12 months they were now able to request parental leave, and after 24 months they could now claim unfair dismissal.

Notice of Dismissal
Under the 1996 Employment Rights Act, for employees in place for longer than a month, their employers must inform them of dismissal in advance. Employees were themselves also required to provide notice if they planned to to resign. The period of notice must be of ‘reasonable’ length, under the legislation, which is influenced by the employment duration.

Unfair Dismissal
Under the Employment Act 1996, employers must provide a reason for sacking staff. Unfair grounds for dismissal include requests for flexible working and defence of statutory rights. Employees dismissed on these grounds, as well as those on the basis of constructive dismissal, have recompense to an employment tribunal.

Employees can be fairly dismissed if they are no longer considered capable or qualified for the role, if their conduct has been unacceptable, if they retire, or if they are made redundant, among other substantial reasons.

Redundancy Payments
If an employee is dismissed because their job has become redundant (no longer necessary) and they have worked for that employer for at least two years, the Employment Rights Acts 1996 specified that they were entitled to receive a sum of money in the form of redundancy pay, from their employer.

Employer Insolvency
If an employer becomes bankrupt and is thus unable to pay its employees, the Act specifies how the State will compensate an employee who is affected.

Subsequent Amendments to the Act

The Public Interest Disclosure Act 1998 (PIDA) amended the 1996 Employment Rights Act to protect whistle-blowers by allowing them to claim unfair dismissal if they lose their job. Protected disclosure now protects whistleblowers from suffering other disadvantages in the workplace. This only applies to people who make a certain type of disclosure, which must involve either a criminal offence, a breach of legal obligation, an injustice, danger to health and safety, or damage to the environment.

In 2019 an amendment to the original legislation came in, which required itemised payslips for all workers. This requires that employers specify the hours worked and the pay rate for these hours.

The Employment Rights (Amendment) Regulations 2018, which came into force in April 2020, also since changed holiday pay calculations for workers who are paid different wages at different times of the year, and lengthened the holiday pay reference period from 12 to 52 weeks. This ensures that holiday pay is not lower for employees who take time off in less busy periods.

The 2018 changes to the Act also made a contract, or written statement, necessary from the first day of employment instead of within two months, for all workers. Within it, additional information relating to working days and times, a probation period, training, paid leave, and other benefits must now be included.

The Employment Rights (Miscellaneous Amendments) Regulations 2019, part of which came into force in 2019 and part in 2020, have quadrupled the maximum fine for a serious breach of worker’s rights.

Recent changes also introduced parental bereavement leave for parents who suffer stillbirths or the death of an infant. Minimum wage, statutory sick pay and parental pay all increased in April 2020, as has the cap on compensatory awards for unfair dismissal claims.