Employment law has changed radically under Labour. Industry minister Alan Johnson defends its performance on
workplace issues. Ben Willmott reports
Industry minister Alan Johnson is proud of the extensive employment
regulations the Government has introduced since 1997.
Measures such as the National Minimum Wage, four weeks paid holiday and the
Working Time Directive were essential to ensure basic civilised standards in
the workplace, Johnson told Personnel Today.
While he admits that regulatory compliance has created more work for
business, he does not believe it has adversely affected its competitiveness.
He said, "It has been tough on business because we have introduced a
lot of things in a short time. This is because EU directives which were blocked
by the previous government had to come in within a certain timescale.
"We are adamant about what we believe is a need for minimum civilised
standards in the workplace. I do not think good employers have anything to
worry about at all. We will never go back to the time when there was an attempt
to sell the UK as the sweatshop of Europe."
The Labour Party is sensitive to criticism that its red tape is stifling
business. Johnson stresses it has taken a balanced approach in introducing
employment regulation. He said, "We have been criticised by the trade
unions that the Working Time Directive did not go far enough and by employers
that we have gone too far.
"We will try to ensure employers get plenty of notice on forthcoming
legislation and allow plenty of time for consultation. We recognise the
problems for business and we want to take them along with us – that is a very
important part of our approach.
"We have introduced the Better Regulation Passport and the Regulatory
Reform Act to make it quicker and easier to repeal out- of-date regulation.
There is also the Better Regulation Task Force, which examines every piece of
legislation."
The minister believes one of Labour’s key achievements has been to create
economic stability and tackle the productivity gap.
He said, "There has been significant progress on the development of
education skills levels, getting the right framework for competition policy and
regulation, providing good quality public infrastructure and the right
incentives for business to invest.
"We reduced Capital Gains tax. Corporation tax is at the lowest level
ever – the lowest of any industrialised nation. We have enhanced first-year
capital allowances and made them permanent, and introduced new research and
development tax credits for SMEs."
Johnson believes there is a cultural issue involved in the productivity gap.
He said, "What I have found since being industry minister is that we are
not very good at spreading best practice and not very good at cooperating to
compete in an industry.
"We took our shipbuilding and ship repair industry to see how things
operate in Holland. The {UK] industry realised they were competitors but there
are a whole string of things they need to cooperate on, such as skills and
training, patents and investment in the infrastructure of the industry.
"That type of approach can be replicated in other industries."
He points to the partnership between the CBI and TUC in helping to solve the
productivity gap as an example of the joint working needed to tackle the issue.
Another key area of success for the Government has been the promotion of
work-life balance practices, claimed Johnson.
He is convinced that employers will benefit from adapting to the changing
expectations of the workforce.
"There is a genuine feeling that the best companies have already been
doing this very successfully," he said. "There is a tight labour
market out there and women have skills they [employers] cannot afford to lose
from the workplace.
"I think there is a huge problem with people being genuinely unhappy
about their working life and their ability to balance it with their domestic
life.
The Government increased the length of statutory maternity leave to 26 weeks
and the amount of unpaid maternity leave so women can have a year off in total.
Maternity pay is also being increased from £60.32 to £100 a week and two weeks’
paternity leave is being introduced.
He said, "I think this is part of having a more civilised environment.
A lot of companies do this already but many companies are stuck in the old
routines. We have to spread best practice and I think there is a good business
case for doing that. We have to invest in future generations, to invest in
ensuring children are raised properly and parents have time to spend with their
children."
Johnson is confident that government initiatives to tackle skills shortages
will also prove successful. He said the new Learning and Skills Councils will
help educate and train adults who have fallen through the educational net
Johnson added, "Whichever industry you look at, they are all concerned
about skills shortages and middle management.
"Two new technology institutes will open in each region to meet the
rising demand for high-level technology skills. We aim to get 750,000 more
people achieving basic skills levels by 2004.
"The Learning and Skills Councils are just getting off the ground. I
would not say we have done everything we could do because it is such a vast
problem. We are listening to industry as well to see how it thinks we can
improve."
