RPC opinion: Employment Rights Bill impact assessment
The RPC's opinion of the Department for Business and Trade’s impact assessment.
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The Employment Rights Bill contains a range of proposals aimed at tackling low pay, poor working conditions and poor job security.
The Regulatory Policy Committee (RPC) gave a ‘red’ rating to the bill’s impact assessment on 21 November 2024. This means that we considered the impact assessment to be ’not fit for purpose’ based on our scrutiny of the evidence and analysis supporting the case for why regulation is necessary.
The RPC’s opinion refers to the evidence and analysis presented in the impact assessment, not the policy itself.
The Department for Business and Trade published an updated economic analysis and summary impact assessment (IA) for the Employment Rights Act on 7 January 2026. The RPC has not scrutinised this enactment stage IA and is not required to do so under the Better Regulation Framework.
We note that the updated IA includes new content which seeks to respond to our ‘not fit for purpose’ opinion.
The updated IA includes more analysis of the broader macroeconomic impacts on wages, employment and output through the use of Computable General Equilibrium and other econometric modelling.
It also includes: a strengthened literature review with additional discussion of market failures and equity considerations to support the rationale for intervention; more justification for the assessment of impacts in the regulatory scorecard; and a more developed programme of monitoring and evaluation activities for the measures within the act.