With Labour, as predicted, winning a General Election landslide during a dramatic night in UK politics, employers’ minds will immediately turn to the party’s policies and how and when they will be implemented.
The next prime minister Sir Keir Starmer said this morning: “Change begins now”.
“It feels good, I have to be honest,” he added.
The new government has pledged “the biggest upgrade to rights at work for a generation” but will face a difficult honeymoon. The country is still in the grips of a cost of living crisis, the public finances are in a parlous state, and there is considerable political and economic uncertainty among the UK’s allies and neighbours.
Starmer has acknowledged that winning an election in this phase of the post-Brexit/post-Covid era means being faced with enormous challenges, especially for a government around which there are so many expectations, not least of all from the unions.
New Deal for Working People
Labour plans to address issues such as insecure work, low pay, and exploitative contracts and pledges to “move towards” a simpler two-part employment status framework under its New Deal, much of which it has set out to implement in its first 100 days in power. That gives it until 13 October to introduce the changes.
However, the TUC appears not to fully trust Labour’s leaders to meet its agenda, with president Matt Wrack earlier this week demanding a summit meeting to establish priorities and Unite general secretary Sharon Graham recently declaring that the altered proposals had “more holes in it than Swiss cheese”. Most trade unions appear to accept the plans, though, which were diluted slightly after consultation with business leaders.
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Commentators have pointed to the difficulties involved in trying to “end” zero-hours contracts, fire and rehire, and give new recruits more rights, with employment lawyers pointing to a series of potential loopholes and unintended consequences.
For example, on basic individual day-one rights for new recruits, Labour believes that making employees less risk-averse about moving jobs will benefit them and benefit employers too, who are more likely to get the best candidate for the job. But, as some have pointed out, might this not make companies more conservative in their recruitment choices? It could also dissuade employers from taking people on, as the cost and risks increase.
Fair Work agency
The initial plans include the creation of a Fair Work agency, whose aim will be to enforce a raft of new rights promised by Labour in its New Deal for Working People, which include making flexible working the default from day one for all; a ban on zero-hours contracts; a right to a predictable working contract and the ending of fire and rehire practices.
Labour has said it will amalgamate the Gangmasters and Labour Abuse Authority, the unit that polices the National Minimum Wage and the Employment Agency Standards Inspectorate into the new body.
Its manifesto referred to a Fair Work Standard that would recognise employers which drove up employment standards. This will be monitored and upheld by a new Social Value Council.
The creation of a single agency builds on a recommendation made by Matthew Taylor in his Review of Modern Working Practices in 2017.
Katherine Flower, partner at UK law firm Burges Salmon, said many of Labour’s proposals for employment law reform could be implemented quickly. She said: “If implemented in whole or even in part, they would mean a fundamental shake up, for employers of all sizes and across all sectors. The sheer scope of the proposed reforms coupled with Labour’s commitment, pre-election, to consult means there will need to be a staggered timeframe for delivery but even so, a number of the proposals should be relatively easy to implement – for example the proposed repeal of the Trade Union Act 2016 and the minimum service levels legislation, so I think we can expect to see some big changes and soon. Other reforms, such as the proposal to ‘merge’ the employment status of ‘employee’ and ‘worker’ are more complex and are likely to take longer.”
Extra teachers
The party has said it will look to recruit 6,500 extra teachers, a proposal that was welcomed by a key educational research body as being the best way of tackling the education skills crisis put forward by any of the three major parties.
In a keynote speech at the Chartered Management Institute’s women’s conference, Labour’s deputy leader outlined plans to make employers liable if they are made aware of an incident that affects interns and volunteers and fail to take action.
Labour has said its rules on protecting employees from sexual harassment will include those who are not employed by the company but are undertaking internships or volunteering.
Ending strikes
Among its immediate priorities, the new government will look to use its more union-friendly demeanour to end the long-running junior doctors strike, but this will not be straightforward. Dr Robert Laurenson, the co-chair of the British Medical Association’s junior doctors committee, said that industrial action would continue if the Labour leader “repeats the mistakes” of former prime minister Rishi Sunak.
The BMA is seeking a 35% pay rise to correct a real-term fall in income since 2008 new health secretary Wes Streeting has branded junior doctors’ demands as “unaffordable”.
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