Employers question effect of Labour, Tory and LibDem manifesto pledges

The parties have now unveiled their election manifestos. Here Personnel Today outlines how their different policies will affect employers.

Flexible working

Party pledges:

  • Labour pledged to increase statutory paternity pay from two to four weeks.
  • The Conservatives and Liberal Democrats said parents could divide maternity leave between them as they wished. From April, Labour allowed mothers to give the second six months of her maternity leave to the father.
  • The Lib Dems said they would extend the right to request flexible working to all employees, while the Tories pledged to extend the right to request to all parents with children under the age of 18. Labour said they would extend the right – currently for parents with kids aged 16 or under – to older workers.

Industry reaction:

The CIPD warned take up of statutory paternity leave was notoriously low, but said a “fathers’ month” should help to popularise the idea that dads should take time off around their baby’s birth.

The CBI backed the extension, claiming it would give families more options to share childcare responsibilities.

The right to request flexible working should be extended to all, according to the CIPD, but only from 2013 giving employers’ reasonable time to adjust.

Default retirement age (DRA)

Party pledges:

  • Labour promised to remove the DRA at 65, either by raising it or scrapping it altogether.
  • Both the Tories and the Lib Dems pledged to scrap the DRA entirely.

Industry reaction:

Employers groups the CBI and EEF were angered about proposals to scrap the DRA.

They argued employers use the DRA to carry out workforce and succession planning. But equality campaigners praised the move to abolish the cut-off age, claiming many older employees were capable of working beyond 65.

The CIPD backed scrapping the DRA, allowing employees to carry on working as long as they wished, subject to maintaining satisfactory performance.

Economic recovery

Party pledges:

  • Labour pledged to create 200,000 jobs through the Future Jobs Fund, with a job or training place for young people who are unemployed for six months, but benefits would be cut at 10 months if they refuse to take part.
  • The Tories announced they would create 400,000 work pairing, apprenticeship, college and training places over two years while the Lib Dems committed to fully meet the upfront cost of adult apprenticeships (currently partly covered by the employer).
  • The Tories also pledged a one-year public sector pay freeze in 2011 for all but the lowest paid one million workers, while the Lib Dems committed to capping pay rises for all public sector employees at £400, initially for two years.

Industry reaction:

The CIPD warned continuing the focus on apprenticeships had both benefits and drawbacks, as employers had to be able to offer the positions, which many were not able to do.

The HR body added there should be a freeze in the overall public sector pay bill to ensure reward policies could still address skills shortages and pay imbalances. The CBI added it was vital that whichever party forms the next government establishes a clear and robust plan to rebuild public finances.

Employment law

Party pledges:

  • The Tories and the Lib Dems said they would reduce red tape in employment by introducing a ‘one-in, one-out’ rule for new regulations and ‘sunset clauses’.

Industry reaction:

The CBI said the ‘one in, one out’ proposal had “superficial appeal” but warned it could mean the only compensatory measure for a new law was the scrapping of out-of-date rules which had little impact on business.

The Institute of Directors welcomed the introduction of ‘sunset clauses’ saying regulations that unnecessarily inhibit businesses “should slip off the statute book automatically instead of being kept alive indefinitely”.

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