People earning more than £50,000 could lose certain employment rights under proposals floated by Jacob Rees-Mogg.
However, according to a report in the Financial Times, which draws on sources in Number 10, Liz Truss has rejected a number of “half-baked” ideas proposed by her business secretary to reform the labour market.
A source close to the prime minister said that her enthusiasm for deregulation had limits. “Several unworkable and half-baked ideas have been suggested and have been rejected,” they said.
“The prime minister wants to reduce burdens on small business but there’s not going to be a bonfire of employment regulation.”
Rees-Mogg wants to introduce “no-fault” dismissals for higher earners – those earning more than £50,000 a year – to remove the rights that enable agency workers to passport to full employment rights, and to repeal working time regulations, according to the FT.
Yesterday, Truss announced plans to exempt tens of thousands of employers from reporting obligations such as for the gender pay gap as part of a “sweeping package of reforms to cut red tape”.
The threshold that exempts smaller business from certain reporting requirements is 250 employees.
But as of yesterday, the government has raised this ceiling to 500 employees for all new regulations under development and to retained EU law as part of reforms on regulations it considers to be “bureaucratic and burdensome on business”.
The notion of removing employment rights from staff earning more than £50,000 is still being thought through, but the FT reported that government officials say any threshold would have to be above £100,000 if it were ever to gain traction.
Rees-Mogg’s allies believe that such a move could be appropriate because people on higher salaries had transferable skills that would enable them to move jobs more easily.
Responding to the changes in reporting requirements yesterday, TUC general secretary Frances O’Grady, said: “Yet again we are seeing reckless and cynical deregulation being pushed through with no consultation and no real thought for the impacts on working people.
“Not content with throwing the economy into turmoil, Tory ministers now have their sights set on business and employment regulation too.
“Let’s be clear. It’s not regulation that’s holding business back – it’s botched Tory economics which has led to low pay, depressed demand and continuous uncertainty.”