UK employment reforms to cost firms £4.5bn a year

Costs will be proportionally higher for small and micro businesses, analysis finds

British prime minister Keir Starmer's new Labour government earlier this month published its Employment Rights Bill that will introduce 28 reforms to the relationship between businesses and their employees. Jaimi Joy/PA Wire

The British Labour government’s package of workers’ rights reforms could cost businesses as much as £4.5bn (€5.4bn) a year, with small firms disproportionately impacted, according to an economic analysis of the policy.

The hit would amount to a rise of about 1.5% of total employment costs for companies, the Department for Business and Trade said in a statement, describing this as a “modest increase”.