PolicyLens

Green - Labour market

Create a right to switch off

Protect workers from routine work contact outside contracted hours, with employer duty guidance.

Last updated: May 2026.

Read the policy-specific methodology note

Policy scope

The central case models a statutory employer duty, guidance and public-sector compliance costs, not compensation for all unpaid overtime.

  • No direct wage floor is created.
  • Unpaid overtime may fall.
  • Public HR systems need updating.

Core trade-offs

Workers gain stronger boundaries. Employers lose some unpaid flexibility and faster response capacity. Output may fall where after-hours work was genuinely productive.

  • Workers gain time boundaries.
  • Employers lose unpaid flexibility.
  • Output can fall in some roles.

Illustrative fiscal impact

+GBP 0.0bn to +GBP 1.5bn. Central estimate: +GBP 0.3bn.

  • Positive numbers mean public-finance pressure; negative numbers mean Exchequer savings.
  • Gross costs are separated from tax, NI and benefit offsets.
  • Private business costs are not automatically fiscal costs.
  • Behavioural responses widen the range materially.
  • This is not an official costing.

Economic impact by 2027-28

  • Jobs: Little direct job effect, but employers may buy fewer flexible professional hours.
  • Wages: Effective hourly pay rises if unpaid overtime falls.
  • Prices: Small aggregate effect; professional services may reprice deadlines.
  • GDP / productivity: Likely negative if unpaid overtime falls without productivity gains.

Assessment

The Treasury cost is small relative to labour-market impact. The policy transfers time back to workers, but firms may lose output or need paid cover where after-hours work is embedded.

Confidence: Low. Fiscal cost is small; output and wellbeing effects are hard to quantify.

Main risks

  • Hidden output loss: Less unpaid overtime can reduce measured output in deadline-driven roles.
  • Legal ambiguity: Reasonable contact exemptions may be contested.
  • Managerial burden: Public bodies and employers need new policies and records.

Safeguards

  • Define emergency exemptions clearly.
  • Monitor unpaid overtime and workload.
  • Keep remedies proportionate.

Academic evidence

Autor, Kerr and Kugler, Economic Journal, 2007

Does Employment Protection Reduce Productivity?

Employment-protection changes can reduce productivity where firms face higher firing and adjustment costs.

Supports caution on policies that raise dismissal, scheduling or adjustment costs.

Does Employment Protection Reduce Productivity? (2007)

UK government evidence

Department for Business and Trade, 2026

Employment Rights Act 2025 - Economic Analysis

The ERA economic analysis estimates around GBP 1bn annual direct business cost before social-care bargaining.

Provides official baseline costs and affected groups.

Employment Rights Act 2025 - Economic Analysis (2026)

Office for National Statistics, 2026

Public sector employment, UK: December 2025

ONS estimates UK public-sector employment at about 6.19 million in December 2025.

Sets the population exposed to public-pay policies.

Public sector employment, UK: December 2025 (2026)

Sources

Other Green policies

PolicyLens estimates are illustrative and not official costings.