It’s almost time for one of the most anticipated General Elections in the UK’s history.
As an Employer, you may be wondering about the implications of a possible change of Government, or changes within an existing Government. All of the parties’ manifestos make significant pledges and propose extensive changes for current Employment Laws and Regulations, so there is a fair amount for Employers to consider before the 12th December.
Although several parties are in the running, for brevity, this month’s blog post will focus on six main pledges (each), made by the Conservatives, the Labour Party, the Liberal Democrats and the Green Party, and their (possible) implications for Employers.
The Conservatives pledge to…
- Lower the age limit for the National Living Wage from 25 to 21, and raising it from £8.21 to £10.39 per hour by 2024;
- Give workers the right to request more predictable contracts and other reasonable protections;
- Look into consulting on making flexible working a default for workers;
- Look into ways of reducing the disability employment gap, through improved access to employment. The party’s 2015 manifesto also promised to halve the disability employment gap, but little progress has been made so far;
- Invest £3bn in a “National Skills Fund”, aimed at assisting employers in finding and hiring the right workers, facilitating returns to work after a period of time away from the workplace (i.e.: to raise a family), and getting those without qualifications onto the work ladder; and
- Support working parents by allowing extended leave for neonatal care, stronger redundancy protection for new mothers, and to consult on ways to facilitate fathers in taking paternity leave.
The Labour Party pledges to…
- Increase the living wage to £10 per hour for workers aged 16 and over within a year;
- Give all workers full employment rights from day one of their job (currently, workers’ rights are determined by factors such as their employment status and length of service);
- Clarify worker status and ban Zero-Hours Contracts of Employment (no further detail given yet other than requiring cancelled shifts to be paid by the employer);
- Extend the Statutory Maternity Pay from 9 months to 12 months, and double the length of paternity leave from 2 weeks to 4 weeks. This would also include pregnancy protection enhancements, in a bid to improve the treatment of women in the workplace;
- Reduce the average full-time working week to 32 hours within 10 years, and giving workers rights to flexible working, for improved work-life balance; and
- To continue to require no fees for raising Tribunal claims, while implementing new Labour courts comprising panels rich in industrial experience.
The Liberal Democrats pledge to…
- Establish an independent review, tasked with consulting on how to set a Living Wage across all sectors;
- Change the law so that flexible working is open to all from day one in the job;
- Create a new ‘dependent contractor’ employment status, in between employment and self-employment, that replaces the ‘worker’ status and comes with basic rights such as minimum earnings levels, sick pay and holiday entitlement;
- Provide 35 hours of free childcare for all children with parents in work from nine months, and for all children from two years, until they start school;
- Require large companies (250+ employees) to have an employee representative on their boards, while giving employees the right to buy shares in the company (this is in a similar vein to the Labour Party’s pledge); and
- Shift the burden of proof in tribunals regarding employment status from the individual to the employer.
The Green Party pledges to…
- Promote stay-at-home working by encouraging teleconferencing practices, introducing local workstation hubs and car sharing schemes, and compelling employers to reimburse low-income workers for working hours’ heating, electricity and Wi-Fi;
- Increase the National Living Wage to £12, extending it to workers aged between 16 and 21;
- Require all medium and large companies to carry out equal pay audits;
- Implement a 40% quota for women on all major company boards;
- Provide 35 hours of free childcare for all, from the age of nine months. This would include a focus on on-site childcare facilities and flexible working options for parents; and
- Encouraging employers to adopt a four-day working week, with no loss of earnings to staff, with a view to addressing work/life balance.
As is usually the way with election manifestos, very little in the way of firm detail is provided as to how (or when) their pledges will be implemented, or how work and life will look when they are in place.
Although the Conservatives make strong pledges geared around elevating the rights of workers, it has been argued that the lack of clarity/detail may be due to their priority focus of Brexit, overshadowing employment law reform and other sectors. But that is not to say that the Conservatives don’t have some very effective plans in mind, to be fully addressed once Brexit is out of the way (keeping our reporting unbiased and neutral over here at Su Allen Headquarters!)
Labour’s manifesto provides a lot of comparative detail, and pledges a real shake-up of current Employment Law and Regulations. It not only focuses on elevating the rights of Workers, but also strengthening the positions of those Workers. However, it has been argued that these changes may be unnerving for Employers, who will be forced to adapt quickly and significantly. Particularly with regards to the ‘Inclusive Ownership Funds’ scheme, which could be met with legal challenges from shareholders and questions over the threshold of 250+ employees (the number of employees doesn’t always reflect the level of turnover). Labour, if elected, plan to hold another referendum on Brexit, so the results of that may have some bearing on who will be responsible for delivering their pledges, and the ultimate timespan.
The Liberal Democrats pledge in a similar vein to the Labour Party, focusing not only on the elevation of Workers, particularly those in more ‘insecure’ groups (i.e.: working parents, workers with disabilities), but also a strengthening of their positions. What gives them an advantage over the Conservatives and the Labour Party is their ability to defend their spending commitments, via their intention of cancelling Brexit if elected, restoring £400-£500 million per week to the economy (according to the IFS).This may not be a popular move with business owners who have already invested time and money into preparing for Brexit and what it means to their business footprint.
It may be worth noting that the Institute for Fiscal Studies (IFS) has also suggested that neither of the election manifesto spending plans by the Conservative and Labour parties are “a properly credible prospectus’.
The Green Party’s pledges with regards to employment law revolve largely around creating a better work/life balance and equality for all. Probably most impactful is their stance on closing equality issues. As noted above, they will require medium and large companies to carry out equal pay audits. Larger companies are already required to report on their Gender Pay Gap, but there is no legal requirement at present to address a gap if they find one. Under the Green Party plan, employers would be required to take steps in this area. Equally, the requirement for a 40% quota for women on major company boards could have a significant effect on companies qualifying under the new policy.
We hope that this summary of manifesto key points will be helpful for you from an Employment Law perspective. Whichever party takes the lead on 12th December, there will be implications for Employers, which we appreciate will be daunting. If you should need any Employment Law advice once our voted Government is in place and implementing their manifesto pledges do not hesitate to contact us.