Organisations in Scotland that do not offer fair pay and conditions should face ‘fair work levies’, and those that do should be rewarded with tax rebates.
This is according to a report published by the Scotland branch of the Institute of Public Policy Research (IPPR), which finds that work is still not a reliable route to financial security for many in the country.
One in 10 workers in Scotland feels their work does not offer them a stable and predictable income, according to a poll of 1,970 working-age adults.
Working women in Scotland are nearly 50% more likely to experience low pay than men, and women have typically experienced far weaker pay progression over the past decade.
Women are also over-represented in part-time work, which is associated with low pay and fewer opportunities for progression, the Delivering a fair work recovery in Scotland report says.
It claims low pay is “endemic” among the under 30s, with 48% of young people paid a rate less than the real Living Wage coming into the Covid-19 crisis.
Black and ethnic minority workers in Scotland are 38% more likely than white workers to experience low pay, and many lone parent households are also struggling to get by on their wages, with the report claiming that a single parent with one child earning £9 an hour will be unlikely to reach a living income.
The report calls for the Scottish government to “take a holistic approach to financial security: one that can break down the barriers that prevent work from providing a route to a living income for particular groups of people or particular types of households”.
It says that ongoing Covid-19-related grants and loans to employers should be made contingent on delivering fair work.
New “fair work levies” on businesses that fail to deliver on fair work criteria and tax rebates for those who do could provide stronger incentives for employers to take up fair work practices, it adds.
Sector-specific minimum terms and conditions, or “fair work agreements”, should also be brought in to ensure fair pay, hours and job quality, especially in some of Scotland’s lower-paid sectors such as hospitality and retail.
Other recommendations made by the report include:
- introducing new “labour market institutions” to drive implementation and enforcement of fair work standards and to help to enforce UK-wide employment law, such as the national minimum wage
- promoting flexible working by default and communicating the benefits of flexible and part-time working to employers
- establishing a new lifelong in-work learning offer, which involves bite-sized, modular learning delivered both online and face-to-face. To begin with it should focus on sectors undergoing significant change, such as retail and oil and gas
- making childcare affordable and accessible so that work becomes a route to a living income for more people. This should include abolishing upfront childcare costs for people claiming universal credit and expanding free childcare to full time hours
- establishing a young person’s taskforce to identify and eliminate forms of labour market exploitation that young people are disproportionately exposed to
- promoting guaranteed interview schemes for disabled people across the Scottish government’s business support services.