The House of Lords has passed the employment rights bill. Last week Tory and cross-bench peers defeated the government over one aspect of the bill – a last-minute addition lifting the cap on compensation paid to people who win a case for unfair dismissal – but that defeat was overturned on Monday and this afternoon peers debated the bill again. This time the Tories and cross-benchers dropped their opposition to the measure, and the bill as agreed by the Commons was approved without a division.
That means it will now get royal assent very shortly.
Lord Sharpe of Epsom, the Conservative spokesperson, told peers that a letter from business groups released by the government yesterday, in which the business groups urged peers to pass the bill, showed that ministers had “misrepresented” the compromise deal unveiled last month.
Under the deal, negotiated with business and unions, the government agreed to remove day one protection from unfair dismissal from the bill, replacing it with protection coming in after six months. This was a win for business.
In return, it was agreed to lift the cap on unfair dismissal payments – a win for unions. But initially there was some confusion about what had actually been agreed.
Currently the cap on compensation payments is either 52 weeks’ pay or 118,223 – whichever figure is lower. Sharpe said the two sides agreed to...
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