Angela Rayner, the former deputy PM, resigned earlier this year – but remains a powerful figure within the Labour Party.
Sir Keir Starmer and Angela Rayner. (Image: Getty)
Angela Rayner has forced Sir Keir Starmer into a significant climbdown over Labour’s flagship workers’ rights package, after the Prime Minister agreed to implement a key set of reforms far earlier than originally planned, following direct talks with his former deputy. Ms Rayner, who resigned from the Cabinet earlier this year, has re-emerged as a powerful voice within the party. She pressed ministers to speed up the introduction of revised unfair-dismissal protections, which are a central part of Labour’s long-awaited Employment Rights Bill.
The changes will now take effect on January 1, 2027 — months earlier than previously anticipated. This accelerated timetable follows a period of negotiation between Ms Rayner, senior unions, and Business Secretary Peter Kyle, as the Government sought to break a legislative deadlock in the House of Lords.
Peers had been holding up the Bill over concerns relating to Labour’s original commitment to give employees the right to claim unfair dismissal from their first day in a job.
That pledge was then watered down, with ministers backing a six-month qualifying period instead of the current two years. Meanwhile, business groups raised concerns, while unions insisted that protections must still be substantially strengthened.
In another major revision, high earners who win unfair dismissal cases could be eligible for unlimited compensation under the revised package.
Existing caps — the lower of an employee’s annual salary or a fixed maximum currently set at £118,223 — are set to be removed.
Former employment secretary Justin Madders. (Image: Chris McAndrew / UK Parliament (Attribution 3.0 Unported (CC BY 3.0)))
Darren Newman, an employment law consultant, cautioned that this decision may encourage large claims from senior professionals, potentially leading to multi-million-pound payouts for City workers and crowding out cases from lower-paid employees who rely more heavily on tribunal compensation.
Ms Rayner, who helped design the reforms while in opposition, had been preparing to table an amendment to accelerate the implementation timetable alongside former employment minister Justin Madders.
She was expected to directly challenge Sir Keir, marking what would have been her first major backbench intervention since stepping down.
By agreeing to the earlier start date, Sir Keir has avoided that confrontation, as reported by The Telegraph, ensuring the new rights will apply to anyone employed from July 2026.
Government sources have presented the move as an attempt to provide certainty to businesses and ensure employers and employees know when the new rules take effect.
A Government source told another newspaper that ministers were satisfied to have a clear timetable and urged the Lords to pass the Bill swiftly. Labour MPs have welcomed the concession, stating the Government had listened to concerns raised across the party.
The agreement represents the latest adjustment to the Government’s employment policy after months of negotiation, and it will likely be seen as a key internal victory for Ms Rayner.
While the reforms are expected to move swiftly through Parliament, further challenges may arise as peers and campaigners scrutinise the final package.
