Labour's Employment Rights Bill

[ey_tony]

I'm neither right wing nor left so don't have a political axe to grind and I come from a background of working for myself since leaving school in the 1960s. I've been looking at the Labour government's Employment Rights plans and I can't help but think that contrary to what they hope to achieve, I suspect it could have the opposite of the desired effect but that remains to be seen.
I'd be interested what others think!

For starters I can see there being quite a rapid growth in unemployment in the part time sector if zero hour contracts are made illegal. I'm not saying ZH contracts are ideal by any means but many workers, contrary to the propaganda put out by the media, is that ZH contracts actually do suit some workers. Also many small employers will just not be able to function and therefore many small businesses especially in the services industry will simply not be able to afford to hire staff and give a contract where work is simply not regular. That is the reality. They will hire fewer staff and if it gets too expensive those businesses will likely fold!

Like millions of other self employed people, I had always worked on a 'zero hours' basis throughout my working life so they are nothing new to myself or the average Self Employed person. It's just something that one accepts if they are S/E and there is no guarantee for many that the bills will be paid at the end of the month.

There are also moves afoot (draft proposals) to make all jobs 'flexible' from day one...I can really see that one taking off with employers. The same with wage rises. Employing someone these days comes with so many responsibilities so anything that makes it even more expensive to employ people than it already is, is only going to go one way and that is in higher unemployment figures. If it doesn't manifest itself in higher unemployment figures it will manifest itself in higher prices so get ready to face increased inflation.

I'm certainly not against paying a fair wage for a fair day's work but looking at some of the proposals of the Employment Rights shake up, something tells me that we'll see a growth in unemployment which will only mean one thing and that is we the taxpayer will foot the bill if it all goes wrong.

 

[niemeyjt]

The law of unintended consequences cannot be repealed.

As with the reported education and rentals/housing legislation, this has clusterfcuk written all over it. There is no point in having loads of rights in a job if there are no jobs because employers cannot risk employing people because of this legislation.

There is no situation a politician cannot make worse.

 

[niall Y]

I think that banning zero hours contracts would be a good thing. There are other forms of contract that offer flexibility in the workplace . All the time I was self employed and working on building sites. I never signed a contract - let alone a zero hours one. It was understood by both parties that work of this nature was finite. When the job finished - you moved to another site.

There is ample evidence to suggest that this form of contract has been used to force down wages, by keeping workers worried about whether they will have enough hours of work to pay their bills. It also puts them in a predicament about turning down work offered, which can easily lead to the employer retaliating, by offering fewer hours.

Though these contracts were deemed legal, many - myself included - felt that they were a retrograde step. It is quite telling which firms predominantly make use of them , including Sports Direct, Amazon, and MacDonald's.

 

[selectortone]

Like most things in life it isn't black and white. On balance doing away with zero hours contracts will hopefully do more good than harm.

 

[ey_tony]

I think that banning zero hours contracts would be a good thing. There are other forms of contract that offer flexibility in the workplace . All the time I was self employed and working on building sites. I never signed a contract - let alone a zero hours one. It was understood by both parties that work of this nature was finite. When the job finished - you moved to another site.

There is ample evidence to suggest that this form of contract has been used to force down wages, by keeping workers worried about whether they will have enough hours of work to pay their bills. It also puts them in a predicament about turning down work offered, which can easily lead to the employer retaliating, by offering fewer hours.

Though these contracts were deemed legal, many - myself included - felt that they were a retrograde step. It is quite telling which firms predominantly make use of them , including Sports Direct, Amazon, and MacDonald's.

I'm not so sure ZHCs have been forcing down wages in recent years, arguably that was the result of the EU's economic migration policies which resulted in the UK having a far too abundant supply of cheap unskilled migrant labour which definitely forced down the wages of the lowest paid.

Since Covid and leaving the EU, wages have risen steadily due to less availability of cheap labour, which is just as well given the inflation, especially energy prices we've had this past 18 months.

Unless there are special reasons for it, ZHC work should only be seen as a stop-gap source of work which is mostly unskilled.
If that's the best people can achieve then re-training or further education is probably a better way to help them get out of those low paying, low prospect jobs and into higher paying reliable sources of work which will raise their standards of living over time.

People need proper full time jobs, not part time jobs propped up and subsidised with taxpayer's money in the form of benefits. Dependence upon benefits other than as a safety net is not the answer. A life on benefits should definitely not be a lifestyle choice.

 

[Yorkieguy]

The proposals were in the Kings Speech, and it's Labour's intention to introduce them 'in the first 100 days'. They stated:

Quote:

"Labour's plan will make work pay. We'll boost wages, make work more secure and support working people to thrive – delivering a genuine living wage, banning exploitative zero-hour contracts, and ending fire and rehire". What they overlook, is that in the private sector if the burden of employment costs becomes excessive, and the only 'flexibility' is that which works in the employees favour not that of the business, companies either become uncompetitive, or become reluctant to take on more employees.

Unquote.
What e don't know, is whether these will conditions will apply to small firms with say ten or twenty employees, or only to larger companies.

The UK private sector comprises largely of non-employing businesses and small employers. SMEs (small and medium-sized enterprises) account for 99.9% of the business population. The government's statistics show that in 2023 SMEs employed 16.7 million people in the UK, 61% of the total number of people employed by private sector companies

There are estimated to be 5.6 million UK private sector businesses.

1.4 million (26%) businesses had employees and 4.1 million (74%) did not employ anyone aside from the owner(s)

There were 5.51 million small businesses (with 0 to 49 employees), 99.2% of the total business population
There were 36,900 medium-sized businesses (with 50 to 249 employees), 0.7% of the total business population
A further 8,000 businesses were large businesses (with 250 or more employees), 0.1% of the total business population

For those who may not know here are the provisions:

The Bill’s provisions

The Government has confirmed the Bill will include:

• The abolition of zero-hour contracts: workers will have a right to a contract that outlines the number of hours they regularly work, and with reasonable notice of any change in shift patterns.
• A ban on fire-and-rehire practices: the controversial act whereby staff are made redundant and then hired again on reduced terms, will be banned. The law will be reformed to provide effective remedies and replace the previous statutory code.
• A day-one right to not be unfairly dismissed: parental leave, sick pay and protection from unfair dismissal for all workers will be introduced, although probation periods can be implemented by employers while they assess new hires. It will also be unlawful to dismiss a woman who is returning from maternity leave for six months except in “exceptional circumstances”.
• Removal of the lower earnings limit on statutory sick pay: statutory sick pay will be available to all workers and the current three-day waiting period will be removed.
• A right to flexible working as a default: flexible working will be allowed from day one for all workers. Employers are “required to accommodate this as far as is reasonable”.

Meanwhile:
Quote:

New labour market data shows economic inactivity at near record high with the UK the only G7 country whose employment rate is not back to pre-pandemic levels. Work and Pensions Secretary Liz Kendall says people have been ignored and denied the support they need to get into work and get on at work.

Data published by the Office for National Statistics (ONS) this morning also shows the percentage of people employed has fallen to 74.4%, while a near record 2.8 million people are now out of work due to long-term sickness. Today’s figures come a week after the Secretary of State set out how the Government’s plan to get Britain working will tackle economic inactivity and drive growth in every corner of the country.

Alongside action to 'make work pay', overhaul skills and address the root causes of worklessness, including poor physical and mental health.

Work and Pensions Secretary, Liz Kendall MP said:

Spiralling economic inactivity, rising unemployment and the UK standing alone as the only G7 country where the employment rate is still not back to pre-pandemic levels. This is a truly dire inheritance which the Government is determined to tackle. Behind these statistics are real people, who have for too long been ignored and denied the support they need to get into work and get on at work. It’s time for change - in every corner of the country. That is why we are taking immediate actions to deliver on our growth mission, and spread jobs, prosperity, and opportunity to everyone, wherever they live.

Unquote.
What's noticeable, is that the onus for this sorry state of affairs isn't on the individuals to take any personal responsibility for their own health, and that 'mental health' - no doubt some of which is doubtless genuine, has spiralled since pre-pandemic levels. We all went through the mill with the pandemic, lockdown etc, which was a miserable time but there seems to be a whole raft of people who have 'issues' or 'special needs', and somehow, it's for the State to deal with it.

For now, Labour can say 'we inherited this mess from 14 years of Tory misrule' but the clock is ticking. Liz Kendal says she's 'on the case' so let's watch this space. Quite how the government is going to 'spread jobs' prosperity and opportunities to those who aren't looking for jobs, and quite where those new jobs are going to come from to 'spread around' against a background of a whole raft of new employment laws, which - once on the books - won't be repealed, is anyone's guess.

It's hard to fault the 'idealism' but where is the 'realism'?

All of which is against an already bloated public sector, which is about to be bestowed with above inflation pay rises not costed for, and the other thing that hasn't been factored in, is that when salaries go up in the public sector, so does the employer pension contribution, so a 5.5% pay rise carries with it significant additional costs to be funded. That's not an argument for not paying it, but the money has to come from somewhere, and unless that 'magic money tree' of wealth creation predicted by the government blossoms and bears fruit, it can only come from yet higher taxes or borrowing.

We'll see.

 

[niemeyjt]

Like most things in life it isn't black and white. On balance doing away with zero hours contracts will hopefully do more good than harm.

And of course getting people onto the payroll instead of being self employed generates loads more taxes.

It will be interesting to see how many currently on ZHC get a 40 hour contract and how many lose their work.

 

[ey_tony]

What surprises me most is the lack of enthusiasm from the left wing posters on here and elsewhere when it comes to supporting and extolling the virtues of the new government's plans with regard to worker's rights.
The silence so to speak is deafening with an almost complete lack of debate which perhaps suggests that even they too are not enamored with the promises and plans.

To be honest I hope that I'm wrong and that this government's plans are a success but I can't help but feel that their plans for worker's rights should have been postponed at least until their 'growing the economy' plans had shown the first signs of having started to come to fruition.

In order to raise more in taxes, the government needs businesses to be successful, that is a given otherwise they will simply be driven out of business and unemployment will soar.

If businesses are already struggling to stay competitive then I can't see how giving workers more rights at this time will somehow suddenly make their businesses more successful?
It would suggest that if anything, business owners will become far more guarded and circumspect with regard to whom they employ and will think very carefully about how specific prospective employees might affect their businesses going forward especially within small businesses. They are definitely going shed underperformers far more quickly who were probably once being carried by the rest of their workforce. One or two underperforming members of their workforce could make the difference between a profit and a loss so if it costs more to employ someone, they are going to get the best value for their money and get rid of of unsuitable workers.
Interesting times.

 

[Jake]

What surprises me most is the lack of enthusiasm from the left wing posters on here and elsewhere when it comes to supporting and extolling the virtues of the new government's plans with regard to worker's rights.

For my part CBA to argue with all the RW bleating now, losers who lost are irrelevant for a bit.

 

[TRITON]

Thing to keep in the equation is, which party, labour or conservative will hold workers rights sacrosanct ?

 

[Spectric]

For starters I can see there being quite a rapid growth in unemployment in the part time sector if zero hour contracts are made illegal. I'm not saying ZH contracts are ideal by any means but many workers, contrary to the propaganda put out by the media, is that ZH contracts actually do suit some workers.

Nothing wrong with zero hour contracts providing they are not forced upon someone, the job description should make it clear that the contract is zero hours and then it is up to you whether you want to apply otherwise look elsewhere.

There are also moves afoot (draft proposals) to make all jobs 'flexible' from day one...I can really see that one taking off with employers.

That will be a total disaster for many businesses as well as divisive within the employment market. When running a company you need your workforce for a known period of hours for multiple reasons. In manufacturing all positions on the production line need to be filled, in a design enviroment the team works as one and you expect support from the others and then many jobs rely on a set number of people to get things done. To make the economy grow they need to stop most working from home and get back to there place of work.

I am not sure about the day one right not to be fired, if someone is not suitable for a role or fails to deliver then they will be just the same on day 5, 8 or whatever so it is best to get rid. Many roles I have taken had an initial interview and then the real test was a trial period where you knew that if you did not meet expectations then you would be out, simple as that because it was the best way to find out if someone could do the task in hand and that their CV was not just bullshieete .

In many ways these new laws will be like spraying weedkiller over your plants, they will not grow and these laws will not create jobs and for many will put the brakes on promotion and payrises. What needs to become the normal is that you get a days pay for a days work and that to get a payrise you need to at least meet objectives but better to exceed them and don't look for the easy options, understand that your future depends upon the success of the company you are working for.

 

[MikeJhn]

The whole thing smacks of trying to bring the Unions back to holding the country to ransom, cynical who me.

 

[niall Y]

Zero hours contracts, may well be legal, but they are immoral. They were crafted to keep the lowest paid workers in -line. Through a constant state of insecurity, it ensures that the workers are much more amenable to the demands of the employer, however unreasonable they are. Such contracts represented a loss of rights, at the time they were introduced. So banning them will only be a return to the status quo. You can have part-time contracts that al least guarantee a minimum payment per week and allow for a full weeks work if needed, So from minimum guaranteed hours to zero hours is little more than squeezing that last ounce of profit out of your workers.

Self employment, as such, has always existed amongst the trades. Bench joiners, although they worked in other peoples shops were often self employed. HMRC certainly didn't like this form of employment. In fact there was a real downer on their part on the building trades in general, and a real effort to curtail self employment. A friend who was a site-agent had a really hard time whilst being investigated. They told him that because he predominantly worked for one employer that he had to be on their books.

Surely one should not wish to live in a society where there is a deliberately created under class to do all the menial jobs so that others can earn the more liveable wages.

 

[Jacob]

The whole thing smacks of trying to bring the Unions back to holding the country to ransom, cynical who me.

There's every reason for unions to get their act together. They have always been a major force in improving conditions of workers and society as a whole.

 

[Terry - Somerset]

Changes in employment rights will have the effect of increasing costs and reducing staffing flexibility. This may be of benefit to those staff whose employment conditions are improved, but:

• it is fundamentally inflationary - businesses will want to recover their increased costs
• it may reduce employment as businesses cannot afford to replace flexible workers with full time permanent staff
• whilst some ZHC is exploitative, many may appreciate the flexibility ZHC offers
• increasing job security from day 1 increases the employment risk to businesses. If a new recruit is unsuitable, then there is no point in extending the problem

The changes proposed seem foolish, but we should wait until when the draft legislation is published. Labour have an overwhelming majority and can legislate as they see fit. Speculating on what might emerge is pointless - it makes little difference what we think.

They need couple of years before judging whether they are delivering on their manifesto - stopping the chaos, starting to rebuild our country, fiscally competent etc etc. That some possible cracks in party unity may be emerging is unsurprising - child benefit cap, public sector pay increases.

My only criticism thus far is the assertion by various cabinet members that things are "much worse than we thought". Typical political BS - they spent the entire election campaign telling us about the "chaos" and since January 2024 have had access to talks with the civil service.

 

[MikeJhn]

The whole of the western world has become a no blame culture, it is now almost impossible to terminate someone's employment no matter what they do, the Unions although needed just after the second WW became far too powerful and held the country to ransom, some may not remember the health hazards they caused by not collecting waste, or the demise of the British car industry due to constant strikes and pay demands, although BMC deserved what they got due to not moving with the times and keeping to their antiquated design's.

 

[Phil Pascoe]

t sure about the day one right not to be fired, if someone is not suitable for a role or fails to deliver then they will be just the same on day 5, 8 or whatever so it is best to get rid. Many roles I have taken had an initial interview and then the real test was a trial period where you knew that if you did not meet expectations then you would be out, simple as that because it was the best way to find out if someone could do the task in hand and that their CV was not just bullshieete .

A young pâtissière I knew went for a job at a top London hotel. I asked how the interview went, and she said OK, it was quite short. She said is that it? and the chap pulled two bags of groceries out from under the table. The kitchen's over there, the first oven's set at 160c, the second at 180c, alter them to suit yourself. Milk, cream, butter, eggs etc. are in the fridge. What do you want me to cook? she asked. You tell us, you're the chef.
She got the job - I always thought that to be as sound a way as any of picking your staff.

 

[Jacob]

The whole of the western world has become a no blame culture, it is now almost impossible to terminate someone's employment no matter what they do, the Unions although needed just after the second WW became far too powerful and held the country to ransom, some may not remember the health hazards they caused by not collecting waste, or the demise of the British car industry due to constant strikes and pay demands, although BMC deserved what they got due to not moving with the times and keeping to their antiquated design's.

Basically archaic management did for UK motor industry, helped by lacklustre government support and failure to join the EEC.
The unions were just fighting for their jobs, which was exactly what they are supposed to do, especially in the face of unimaginative poor management.
Modern makers like Toyota have a much more constructive relationship with the unions, to everybody's advantage.

 

[niall Y]

Surely a wage should supply enough money for a worker to exist. Any business that cannot survive without paying a reasonable wage to their workers is one that is not economically viable.

A business whose staff are predominantly on zero hours contracts and minimum wages. will be having their labour costs subsidised with working families, tax credits. This applies not only to retail businesses, like the some of the major supermarkets but also to the NHS.

There is going to have to be a readjustment of relative wages. We are none of us immune to this or the price that will have to be paid for all that "quantitative easing" that has gone on in response to Covid and the various economic storms. I believe there is going to be a very difficult reckoning over the next few years.

 

[Jacob]

Changes in employment rights will have the effect of increasing costs and reducing staffing flexibility. This may be of benefit to those staff whose employment conditions are improved, but:

• it is fundamentally inflationary - businesses will want to recover their increased costs
• it may reduce employment as businesses cannot afford to replace flexible workers with full time permanent staff
• whilst some ZHC is exploitative, many may appreciate the flexibility ZHC offers
• increasing job security from day 1 increases the employment risk to businesses. If a new recruit is unsuitable, then there is no point in extending the problem

The changes proposed seem foolish, but we should wait until when the draft legislation is published. Labour have an overwhelming majority and can legislate as they see fit. Speculating on what might emerge is pointless - it makes little difference what we think.

They need couple of years before judging whether they are delivering on their manifesto - stopping the chaos, starting to rebuild our country, fiscally competent etc etc. That some possible cracks in party unity may be emerging is unsurprising - child benefit cap, public sector pay increases.

My only criticism thus far is the assertion by various cabinet members that things are "much worse than we thought". Typical political BS - they spent the entire election campaign telling us about the "chaos" and since January 2024 have had access to talks with the civil service.

The right always trot out objections to any improvement in workers rights and conditions and are best ignored, not least because their unimaginative doom-mongering usually proves to be utterly mistaken.
Better wages and conditions filters through society in so many ways, not least in the way the money is spent, benefitting other businesses, the economy and society as a whole.
What goes around comes around.