The General Election battleground and what this might mean from 9th June…
As the last of the political parties publish their manifestos for the General Election, it is clear that new promises on workers’ rights are centre stage.
But what might that mean for smaller employers? We’ve been having a look at the party manifestos that have been published to date to see the key ways in which you could be affected.
1. Guarantee of protection of existing EU workers rights after Brexit
This is a key pledge of the Conservative manifesto, and should mean that things like the Equality Act provisions on discrimination and the Working Time Regulations on things like minimum rest breaks will stay unchanged after Brexit. However, as we have updated you in the past, there is still a chance that case law relating to areas of EU law which are not so clear cut, such as what should be included in calculations of holiday pay, will be re-considered afresh after Brexit.
UKIP have also promised to protect workers’ rights once we have left the EU, saying that leaving the EU must not usher in any kind of ‘race to the bottom’ on employment rights.
And with Labour’s 20 point plan on workers’ rights seeking to give workers significant additional rights such as employment rights from day 1 of employment, and the Lib Dems and Greens also wanting to act on things like zero hours contracts and unpaid internships, it is safe to assume that existing rights for workers in the UK will at least remain the same and may also be increased after the Election.
2. Minimum Wage
Most of the parties are promising to increase the amount of the National Living Wage and the other minimum wages paid to younger workers and apprentices during the next 5 years.
The Conservatives are promising to increase the level, in line with earnings growth, for the next 5 years, which is therefore likely to increase it to about £8.75 per hour by 2020 on current forecasts.
Labour is promising to raise the level of the National Living Wage from the current £7.50 per hour to £10 per hour by 2020. The same promise is made by the Green Party with the additional promises to scrap age-related wage bands in order to have the same minimum wage for all age groups, and to work towards the introduction of a universal basic income.
UKIP are promising to strengthen enforcement for the National Living and Minimum Wages by reversing cuts to the number of minimum wage inspectors.
The Lib Dems are promising an independent review on how to set a genuine living wage rate, the implication being that the existing rate is not high enough.
And the SNP have called for a living wage, by 2022, that will be slightly more than £10 per hour.
3. Gig Economy and Zero Hours Contracts
In the Autumn of 2016, Theresa May’s government set up the independent Taylor review of modern working practices in the ‘gig economy’, to make recommendations about what, if anything, needs to change about the status of workers and the terms under which they work. This was fuelled by the number of cases currently going through the courts challenging the self-employed status of people like Uber drivers and other courier company drivers, as well as the media attention on the mis-use of zero hours contracts by companies like Sports Direct.
The Taylor review has yet to publish its report, but a number of the political parties seem to have stolen a march on this by promising:
- A ban on zero hours contracts (Labour, Greens)
- Stamping out abuse of zero-hours contracts by creating a formal right to request a fixed contract and consulting on introducing a right to make regular patterns of work contractual after a period of time. (Lib Dems)
- Significantly tightening up rules on zero hours contracts and severely limiting their use (UKIP)
Unspecified protections for “gig” economy workers, looking at areas such as whether they should be entitled to maternity or paternity leave (Conservatives).
From this we can see that the use of zero hours contracts for anything but very temporary staffing needs is likely to prove increasing difficult, if not impossible.
4. Family Friendly and Wellbeing Policies
All of the parties have pledges of one sort or another to make it easier in some way to take time off to look after family dependents, whether they are children or older, sick relatives. Some of this is unpaid leave and some is paid, but all these sorts of changes are likely to hit smaller business hardest where it is less easy to provide proper cover for absent employees.
The Conservatives have promised to give workers the right to up to a year’s unpaid leave to care for a relative, as well as two weeks’ paid leave for parents whose child has died. They are also looking at the concept of ‘returnships’ to give extra training to mothers going back to work after having a baby. They are also promising to extend protection for those with mental health conditions. Currently, the provisions of the Equality Act only kick in after an employee has suffered with a mental health condition for 12 months, but they propose that people with short term mental health issues would also become protected.
Some of the parties want to increase the number of weeks that a father can take on the birth of a child (currently two weeks). The Labour Party wants to double paid Paternity Leave to four weeks and increase Paternity Pay. The Lib Dems want to expand Shared Parental Leave with an additional ‘use it or lose it’ month. They would also make Paternity Leave and Shared Parental Leave a ‘day one’ right.
The Lib Dems also want employers to provide more flexible working, making this a ‘day one’ right, with a presumption that work is flexible unless there is a clear business reason it cannot be.
The Green Party is promising to phase in a four day working week.
5. Employment rights from day one
Various pledges have been made by the smaller parties in relation to specific employment rights that would be promised from day one of employment, but the Labour party has gone further and promised that all employment rights would exist from day one. This could have huge cost implications for smaller businesses.
This has not been taken up by the Conservatives.
6. Employment tribunal fees
The introduction of fees to bring a claim in an employment tribunal has seen a large drop in the number of cases being brought by former employees seeking to challenge their treatment by their employer.
Labour and the Lib Dems both want to strengthen the enforcement of employment rights by abolishing tribunal fees, but this would also increase the risk for employers of facing more spurious claims again. In addition, with all parties seeking to increase the number of rights given to workers in their manifestos, if tribunal fees are abolished, this could also lead to an increase in claims based on new rights.
And these are just some of the ways in which you might be affected. The parties are also looking at a statutory right to take time off for training (Conservatives), worker representation at board level and providing employees with rights on shareholder information (Conservatives), the reversal of recent laws and the strengthening of Trade Union rights (Labour) and even four new bank holidays (Labour).
So, you can see that whichever party wins the General Election, most employers will need to plan for significant changes in their structures and budgeting for employees for the next 5 years. If you would like help keeping abreast of whatever changes are coming down the road, we at citrusHR will be happy to help. Simply call us on 0333 444 0165 or get in touch here.