New Employment Rights Bill must build an economy that works for women, says WBG

The Government’s Employment Rights Bill is an ambitious step forward for worker’s rights, which has the potential to build an economy that truly works for women. Recent research carried out by WBG found that:

• 1.47 million women will have new rights to sick pay under new provisions.
• 555,000 women to have job security due to banning of exploitative zero-hour contracts and focus on women-led sectors.

Dr Mary-Ann Stephenson, Director of the Women’s Budget Group:

“Women are still the majority of workers in low paid or precarious work in our economy. They have the most to benefit from new workers’ rights laws pledged by the new Government. The ambition set out in today’s Bill has the potential to reduce the gender pay gap and economic inactivity, growing the economy over time. Maintaining this ambition throughout the consultation process over the coming months will be vital to ensure the Bill is effective in building a feminist future of work where every woman is paid fairly, can work flexibly but with security and is free from discrimination or injustice.”

“But the Government can and must go further to genuinely improve women’s working lives and address the impact of unpaid care work and lack of access to justice. To deliver a feminist future of work, these reforms must also go hand in hand with bold reform and invest in our early education and childcare and social care systems as well as restoring access to legal aid.” The Government must carry out and publish meaningful equality impact assessments to ensure policy is truly effective in reducing inequalities in the workplace and across the economy.”

Pregnancy and maternity discrimination

“It is promising to see a commitment to strengthening the pregnancy and redundancy protections in line with what was set out in Labour’s manifesto. Our research finds that the most widespread employment law issue women seek help with is pregnancy/maternity discrimination ¹ .Extending the time limit for bringing a claim for 3 to 6 months will hugely increase vulnerable women’s access to justice. And we eagerly await the review of parental and carer’s leave. We urge the Government to continue to prioritise and deliver this within their first year, as committed to within the manifesto.”

Extending sick pay

“The Bill also brings good news on removing the threshold for statutory sick pay eligibility and the three-day wait period before a worker can claim it. It is important that rights to sick pay are extended to all workers. This would mean that 1.5 million ² women would have new rights to sick pay. This is a step toward tackling women’s health-related economic inactivity, with 1.5 million women out of the workforce due to long term sickness (200,000 more women than men ³ . Extending it to all workers and paying it at an adequate rate increases the impact on economic activity, allowing workers to take time off at early stages of a health condition and increasing the chances of recovery and remaining in labour market.”

Gender pay gap reporting

“However, it is important that policy design within the Bill is truly able to achieve its aims. For example, proposals around gender pay gap reporting for outsourced workers may inadvertently entrench low wages within female-dominated sectors like cleaning, rather than promoting fair, in-house pay. Addressing the root causes of the gender pay gap, which are often linked to low pay in roles traditionally occupied by women, should be a primary focus.”

Equality Impact Assessments

“We welcome the extensive consultation Labour has pledged across many of the measures in the Bill and are ready to support the Government in ensuring these policies are effective in creating an economy that works for women. To this end, it is critical for the Government to publish comprehensive equality impact assessments (EIAs) for the Bill as a whole and for each individual policy by the second reading of the Bill on 21 October. Meaningful EIAs will provide a foundation for informed policymaking, helping to dismantle systemic inequalities and avoid perpetuating cycles of inequality.”

A holistic approach to policy-making

“Furthermore, if this Bill is to “genuinely improve women’s working lives,” it must address the intersecting challenges women face. This includes not only employment protections but also improvements to childcare and social care infrastructure, as well as expanded access to legal aid. Only through holistic, well-designed policies can we build a resilient and inclusive economy.”

Key stats on women and employment

WBG argues that Labour’s Employment Rights Bill has the potential to help reduce the gender pay gap over time and build a feminist future of work:

• More women (3.5%) than men (2.8%) are employed on zero-hours contracts.
• 6.5% of women do not earn enough to qualify for sick pay compared to 2.8% of men.
• The gender earnings gap (weekly pay) was 25% for all workers in 2024 while the gender pay gap (annual pay) was 14.3%.
• More women (10.5%) than men (7.2%) are classified as low earners.
• 72% of people who work part-time are women.
• 25.1% of women compared to 19.1% of men are economically inactive.

WBG recommendations:

In order to deliver on the aim of closing the gender pay gap and increasing gender equality the Government should go further by:

• Extending statutory sick pay to self-employed workers and increase the rate without changing the period of payment.
• Delivering comprehensive reform of the social care and childcare systems as well as paid carers’ leave, to help redistribute unpaid care work.
• Ensuring genuine flexible working by introducing an advertising duty for all jobs to be advertised as flexible except in reasonable exceptions.
• Reviewing and restore legal aid in discrimination cases to ensure women have access to new employment rights as well as adequately resourcing the EHRC to enforce women’s rights.
• Introducing a new model of parental leave ensuring six months non-transferable leave for each parent and, a six-month shared leave entitlement.
• Strengthening and properly enforce the public sector equality duty with new duties and training on government officials.