Patrick Glencross: Employment rights and the General Election

Employment rights and the General Election

How much will employment rights feature during the general election campaign?  While the political parties rush to put together their manifestos, Patrick Glencross of law firm Cripps reviews the employment-related pledges which are emerging from the early days of the campaign, and adds some predictions for other ideas and proposals to look out for among the daily stream of slogans and soundbites.

Brexit and employment rights

How the different parties articulate their approach to Brexit will be critical in several areas of employment law. The choice whether to leave or remain in the single market seems inextricably linked with the freedom of movement for workers between the UK and Europe, as well as the extent to which courts and tribunals continue to fall under the jurisdiction of the European Court of Justice.

The Government’s white paper in February promised a “cut and paste” approach to employment rights derived from European law, in which it committed to safeguard the rights of workers set out in European legislation. The white paper also promised to enhance these rights, although it is unclear whether this promise implies future legislation changes or just the retention of existing employment rights which currently go beyond EU law, such as statutory annual leave and maternity leave.

Employment status and the gig economy

The employment status and associated rights of people working in the “gig economy” has been under the spotlight over the last couple years, with the succession of high-profile cases involving the likes of Uber, Deliveroo, delivery drivers and cycle couriers. These issues have been the focus of the Taylor review on modern employment practices, although the date of the election will precede the conclusion of this review and the publication of its report.

It is likely however that across the political spectrum parties will address the theme of employment status during the election campaign, and may perhaps pick up some of the ideas being floated by the Taylor review. For example, should there be a new definition of worker status which will carry greater clarity than current legislation? Should the default position be that an individual providing personal service to an organisation is a worker and an employee unless the “employer” proves otherwise?

Zero-hours contracts

The trend in engaging staff on zero-hours contracts (ZHCs) was a frequent topic of argument during the 2015 election. The most recent statistics, for the final three months of 2016, showed the number of people on ZHCs to be nearing one million, although with some signs of a slowdown in the rate of growth. Some parties are following the example set recently by the New Zealand parliament and pledging to outlaw ZHCs.

It will be interesting to see if any parties adopt the idea emerging from the Taylor Review of a “zero hours premium”, by which employers would be compelled to pay staff at a rate higher than the national minimum wage for working hours which are not guaranteed in advance.

National minimum wage (NMW)

The national living wage (the NMW rate for workers aged 25 and above) increased this month to £7.50 per hour, and is on track to reach a target of 60 percent of median earnings by 2020.  Depending on future patterns in pay growth, this is projected to equate to somewhere between £8.60 and £9.00 per hour.

Some parties will promise greater or faster increases to the national living wage and the NMW, for example Labour has a policy commitment to increase the living wage to £10 per hour by 2020 with a scheme to compensate small firms which have problems in paying staff at this rate. Will any party propose to abolish the lower NMW rates which apply to workers under the age of 25?

Family-friendly policies, equality and discrimination

The Government’s scheme to introduce 30 hours of free childcare for three- to four-year-olds is due to apply from September 2017, and the new tax-free childcare scheme is likely to come into effect around the same time. It will be interesting to see whether any of the parties proposes other measures with a view to supporting employees who have parental responsibilities, and in particular working mothers. Will any party revive the idea of statutory leave for working grandparents?

While gender pay gap reporting has only just come into force, there are already suggestions for introducing similar reporting obligations in relation to other areas of disparity in the labour market, for example ideas addressed at tackling the disability employment gap. Those ideas echo the Prime Minister’s pledge to end the stigma of mental health in the workplace, although it is not obvious how that pledge would crystallise in the form of legislative change.

Employment Tribunal fees

The Government’s recent review of the introduction of Employment Tribunal fees proposed some reforms, for example extending access to support under the Help with Fees, but otherwise made clear that Tribunal fees are here to stay. Other parties have committed to the abolition of Tribunal fees. Meanwhile we await the judgment of the Supreme Court following the recent appeal hearing of the judicial review against Tribunal fees brought by Unison.

Income tax and national insurance (NI)

Any policies to change income tax and NI rates will inevitably hit the headlines; equally there are indications that the Conservative manifesto will drop the pledge from the last election not to increase income tax, NI and VAT. If so, will this pave the way for reviving the plans from the last Budget to narrow the gap in the tax rates between the employed and the self-employed?

Conclusion

It is quite clear that employment rights and employment law generally will be high up the agenda during the election campaign, and over the next few weeks there will be plenty of promises and ideas in these areas to watch out for which may ultimately influence the shape of future employment policies and legislative changes in the coming years.

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