Minister denies unfair dismissal policy U-turn is breach of manifesto pledge but unions and Labour MPs criticise decision
Good morning. Keir Starmer and Rachel Reeves spent yesterday denying that Labour broke a manifesto promise with its tax-raising budget. Given that Reeves had been expected to freeze income tax thresholds for weeks, it was a rather stale argument that did not go anywhere new. Then, late yesterday afternoon, the government opened up another broken manifesto argument with a surprise announcement about a U-turn on the employment rights bill.
Here is our overnight story by Jessica Elgot and Richard Partington.
It is not hard to see why ministers agreed to the concession. Day one protection from unfair dismissal was very unpopular with employers, who said it would deter firms from hiring new workers. With unemployment rising, and the hospitality sector in particular alarmed about the implication of some of the measures in the budget, this is a concession that will significantly ease business concerns about the legislation. And most unions seem willing to accept the climbdown as the price for getting the bill into law quickly.
But it still came as a surprise. On Monday No 10 was telling journalists “we will overturn all attempts to scupper [the employment rights bill plans] including watering down Day 1 protection from unfair dismissal”. Governments regularly make concessions when legisalation is going through the House of Lords, but this bill is at the “ping-pong'” stage and MPs have already overturned the Lords amendments blocking day one protection from unfair dismissal twice. This is a Labour manifesto commitment; by convention, the Lords was obliged to back down. But there is evidence is becoming increasingly belligerent (on other bills too), and ministers decided a compromise and swift passage to royal assent would be better than a prolonged battle.
