Labour’s proposed Employment Rights Bill has come under fire from leading retailers who warn it could force shops to raise prices and shed jobs across the UK high street.
A survey conducted by the British Retail Consortium (BRC) has revealed deep concern within the sector over the potential economic consequences of the incoming legislation, which aims to bolster employee protections and clamp down on insecure work practices.
The poll, which canvassed human resources directors from retailers across the country, found that roughly half expect the Bill to result in higher costs for consumers, while a similar number foresee a reduction in job opportunities as businesses grapple with the financial burden of compliance.
Central to the concerns is the proposed right to guaranteed working hours, intended to curb the widespread use of zero-hours contracts that offer workers no assurance of regular employment. While welcomed by workers’ groups and trade unions, retailers argue that the measure could reduce the flexibility that many part-time roles in the industry currently rely upon.
Helen Dickinson, chief executive of the BRC, said the changes risk unintended consequences at a time when retailers are already under pressure from rising costs and weakened consumer demand.
“Those in charge of retail hiring are clear – unless amended, the Bill will make it even harder to keep and create jobs and reduce the flexibility that defines many existing retail roles,” she warned.
“Retailers agree with the Government on the need to crack down on unscrupulous employers, but in its current form the Employment Rights Bill could backfire, putting the brakes on hiring, or worse still, putting retail job numbers further into reverse.”
Other provisions in the Bill include curbs on the controversial “fire-and-rehire” practice, which some companies have used to re-employ staff on less favourable terms, and new “day one” rights, such as statutory sick pay, paternity leave, and the right to request flexible working from the outset of employment.
The Government says the reforms are necessary to protect workers and to build a fairer and more resilient labour market. However, industry figures say the timing is problematic, particularly in light of the recent rise in National Insurance contributions which further increased employment costs from April.
The BRC’s findings suggest that the guaranteed hours proposal is the most contentious aspect for retailers, with many warning it could lead to reduced availability of part-time jobs – particularly important for students, carers, and those balancing work with other responsibilities.
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The retail sector, already grappling with sluggish footfall and the shift to online shopping, remains one of the country’s largest private-sector employers, providing work to over three million people. Any contraction in retail jobs could have ripple effects on local economies, particularly in areas where high street retail remains a significant source of employment.
Dickinson emphasised that the retail industry shares the Government’s goal of promoting job creation and reducing welfare dependency but urged ministers to work collaboratively to ensure the reforms are practical and do not damage the very employment prospects they aim to protect.
“The Government wants growth and wants to reform welfare and increase the numbers in work. We are aligned on the objectives,” she said.
“Now it’s about making sure the implementation of policies help, not hinder, retailers’ ability to provide the very jobs the economy needs.”
As Parliament prepares to debate the Bill in the coming weeks, all eyes will be on whether ministers are willing to compromise in the face of growing concerns from Britain’s retail heartland.
Should the Government rethink key parts of the Bill to protect retail jobs, or is it time for tougher workers’ rights regardless of cost?
