Greg Smith MP: speeches 2024

Speeches

• 28 Nov 2024 · Employment Rights Bill (Third sitting) · Hansard source

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  What do you base that on? Nye Cominetti: Internationally, we can draw scatter plots of the employment level in a country and the extent of employment regulation, and basically those lines come out flat. You have some countries with very high employment and very high levels of regulation, and some countries with lower employment and high regulation, so there is no clear relationship with the employment levels across countries. That is confirmed by the OECD, which has done lots of detailed work looking into the impact of periods when countries have either rowed back on reforms or expanded them. What we do see in the employment data is that when you beef up the reforms around dismissals for individual or collective workers, you tend to see lower hiring rates. So the rate at which workers move around the economy will probably slow down if you make it significantly harder for employers to fire workers, and that gives rise to potential implications for productivity growth. Now, I still think those effects will be small. When the Office for Budget Responsibility, in one or two years’ time, starts putting the numbers into its forecasts, I expect them to be very small indeed. My expectation is that the employment level will be very, very narrowly lower if anything. To give you some sense of scale, the OBR said it thinks that the employer national insurance contributions bill will be about £25 billion, and that that would lower the employment level in this country by 0.2%. The DBT said that it thinks the direct costs of the measures, including sick pay, are in the order of magnitude of £5 billion. If you compare those numbers, that starts to give you a sense of the scale of potential employment effects that we are talking about. I am sorry not to give you a more exciting answer, but my best guess is that the impact on employment levels will be small.

• 28 Nov 2024 · Employment Rights Bill (Third sitting) · Hansard source

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  Q I am sure you are aware that the independent Regulatory Policy Committee has found the impact assessments on the Bill to be, in its words, “not fit for purpose”. Are you concerned that the impacts of the Bill on your members, or indeed on the wider economy, have not been properly assessed?

• 28 Nov 2024 · Employment Rights Bill (Third sitting) · Hansard source

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  Q Has the Resolution Foundation attempted to put a number on the impact on the economy, positive or negative, of this Bill? Nye Cominetti: No. I can describe in general terms how we might think about the potential impact, but I think any researcher or economist who tried to put a number on it would be misleadingly specific or misleadingly accurate. Not only do we not know what the direction of the impact might be—it could be that there are small positive or negative impacts on the size of GDP—but it is very hard to get a sense of the scale of the impacts. If you want some kind of judgment, the impact on economic growth will probably be very low—very close to zero. My expectation is that it will possibly be negative, but that is an incredibly hard judgment to reach, because you can point to impacts in both directions. It is very uncertain, but the important point to make is that that does not mean that we should not be going ahead with these reforms. We should not be pursuing only those reforms where we can say, “The impact on GDP will be x,” even if not very confidently. One of the first things that this Bill should do is improve working lives for workers. It may be that we cannot put a monetary value on that, or that there is no associated impact on GDP, but to me that is the main and the first reason why many of these reforms should be undertaken.

• 28 Nov 2024 · Employment Rights Bill (Third sitting) · Hansard source

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  Well, the Regulatory Policy Committee has said that eight of the impact assessments for this Bill—the separate columns—are not fit for purpose. Do you think the Bill had its tyres kicked hard enough before it went into Second Reading and Public Bill Committee? Nye Cominetti: It is very hard to assess the impact of the Bill, as many of the details are yet to be determined. The Government said that they wanted to do this within their first 100 days, and they managed to do so, but that meant that they had to leave many “fill in the blank later” bits in the Bill, so I do not particularly blame the civil servants in the Department for Business and Trade for having struggled to come up with clear numbers on the costings and the potential impact. For example, on the right to a regular contract, the impact on business will depend on how “low” is defined, in terms of the qualifying threshold that workers will have to reach. It will depend on how businesses have to go about making the offer to workers. It will depend on how regularly those offers have to be made, which relates to the reference period. In the light of all those unknowns, it would be very difficult for the Department to have come up with firm numbers. I think in the end they said £5 billion, but it is hard to know whether that is a good or a bad number. I would not be so negative as to say that they have failed in any sense; I just think that they were given a very difficult job. As more detail becomes available, it would be great if the civil servants who have already put a lot of thought into the process could come back and say, “Now that we know a bit more about what is actually going to be happening, here is our updated view on what the impact of the regulations might be.”

• 28 Nov 2024 · Employment Rights Bill (Third sitting) · Hansard source

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  Q I appreciate that you will probably put caveats around this, given your previous answer, but do you have a view on whether the Bill will ultimately—ballpark—result in more jobs in the economy, the same number or fewer? Nye Cominetti: The same number, would be my best guess.

• 28 Nov 2024 · Employment Rights Bill (Third sitting) · Hansard source

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  Q On Tuesday, we heard a witness from a different trade union say that the Bill will lead to the re-unionisation of the economy. Do you concur with that assessment? If you do not, or perhaps even if you do, are there any areas in which your unions feel the Bill should actually be going much further? Liron Velleman: At Community, we are confident that the Bill would represent a positive step for our existing members and would allow for greater coverage of trade union membership across the sectors we work in. For example, in the third sector or in education and early years—especially in early years, where, in some of the private provision of nurseries and early years settings, there is not currently as much trade union coverage—the Bill would make it easier for people to join a trade union and see the benefits of membership. On whether it would bring full unionisation of the economy, I am not sure it would necessarily go that far, but some of the onus is on trade unions to make sure that we are delivering, in a modern way, the best way for working people in this country to understand the benefits that they could receive by joining one of our unions. Joanne Cairns: I agree with Liron. We have good relationships with a number of major employers where we are recognised. You heard earlier from the Co-op. We are recognised there and by a number of other major employers. However, across the retail sector, trade union membership is currently at around only 12%, which is a similar level to the rest of the private sector. Very often, the reason people have not joined a union is simply that they have not had the opportunity to find out about what a union does—nobody has ever asked them to join a trade union. We think that the rights that the Bill will bring in around access to workplaces will be particularly important. The Bill will also simplify the statutory framework around recognition, which is currently extremely burdensome and makes it very difficult for trade unions to gain statutory recognition, particularly with larger employers.

• 28 Nov 2024 · Employment Rights Bill (Third sitting) · Hansard source

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  Please do. Helen Dickinson : A reference period is conceptually a good idea—the question is whether it is too short. I know that some people who appeared in front of the Committee earlier this week suggested that it should be slightly longer. I think requiring a business to offer the hours of that reference period in every single circumstance does not really take into account the peaks and troughs, the flexibility that retail businesses need or that lots of people who work in retail already have, and how the actual implementation could be framed to give people the opportunity to opt out or to have the right to request, as opposed to the right to have. That is an example of where the implementation could be very onerous, very expensive and disincentivising, or, if it is implemented in a way that actually works for businesses and employees—because a lot of people value that flexibility—can create the win-win that the framework and the objectives of the Bill are seeking. James Lowman : I agree with much of what Claire and Helen said, so in the interests of time, I will not repeat that. To give a bit more flavour on convenience stores, we see ourselves as an exemplar of flexible, local, secure working—98% of colleagues have a contract, and zero-hours contracts are used very little. More than a third of our colleagues walk to work. We are the ultimate local, flexible employer. Most requests for flexible working, whether in the formal, legislative framework or not, are agreed to, because if you have good people, you want to keep them in the business and you want to accommodate what are usually other responsibilities, which are often about care for children or older relatives. Specifically on probationary periods and early rights, 84% of people who work in our sector have been there for more than one year. Most people who have been there for that period of time stay on. Half of people working in our sector have been there for more than five years, so we have a longevity of employment, but there is a spike of people who move on quite quickly because it is not right for them. Seasonality, of course, could cause that. There is a particular challenge when we are talking about encouraging our members, as we do, to look at bringing in people from typically underutilised backgrounds, whether that is care-experienced people, ex-forces or ex-offenders. We produced a document with the Retail Sector Council last year looking at opportunities for those people. For everyone starting a business, there is always a chance that it just does not work out. It just does not transpire that it is the job for them. Sensible probationary periods—they do not have to be too long—will allow that to play out without undue risk to the employer. The final point I would make is that in an independent business—we represent some large businesses, but 71% of convenience stores are independently operated—the person running the business is the finance director, the buying director, the marketing director, the operations director and the HR director. No specialist resource is being called on, so additional processes to manage someone leaving the business are particularly burdensome for smaller organisations who do not always have people like Claire and her colleagues to help them through that.

• 26 Nov 2024 · Employment Rights Bill (Second sitting) · Hansard source

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  Q Good afternoon to the witnesses. When any wide-reaching legislation that is seeking to make a number of changes to employment law comes in, there are likely to be unintended consequences. I will put the question in two halves. To Ms Griffin and Mr Gray, do you see any unintended consequences that could damage your businesses or make you less likely to take on new staff? To Mr Lynch, who I suspect may come from the other side of the argument, do you think the Bill goes far enough? Gemma Griffin: Just to make it clear, we are talking about seafarers, so I am not here to represent the shore-based colleagues in our organisation. As it stands, I do not believe—my learned colleagues beside me have more experience with shore-based stuff—that our seafarers are currently covered by the Bill. My understanding is that there is an opportunity today to talk to your good selves about ways or mechanisms by which we may be able to enshrine something for seafarers, so that they can be afforded similar rights and opportunities as shore-based workers. The key point in the Bill currently relates to fire and rehire. That is the sort of stuff that we as DFDS are very pleased that you will be banning, and I hope that it does actually refer to seafarers as well. For us, that is the biggest concern among the many others that we have, as an operator that is simply looking for a fair and level playing field. That is particularly the case when we talk about the straits of Dover, where we move from UK territorial waters straight into French territorial waters, with no international waters where one might use the normal ways of international seafaring legislation. We are really hoping that we can capture some of the things that we believe our seafarers are at risk of losing if we do not extend the legislation to them in whatever way we can.

• 26 Nov 2024 · Employment Rights Bill (Second sitting) · Hansard source

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  But on the question about the unintended consequences of elements of the Bill— Gemma Griffin: Do I see any unintended consequences for our land-based employees?

• 26 Nov 2024 · Employment Rights Bill (Second sitting) · Hansard source

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  Q What about your ports-based staff—your land-based staff? Gemma Griffin: Our land-based staff are already covered.

• 26 Nov 2024 · Employment Rights Bill (Second sitting) · Hansard source

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  Q Do you have a view on how it would be best to structure change around specific single projects like the building of a railway station, which might take two, three or four years and then that is it; there is a cliff edge and the project is over? How would you best structure that? Alasdair Reisner: It is an interesting question. There is the notification element and the consultation element. I suppose we have to ask what the policy is trying to achieve. If it were trying to avoid people almost hiding redundancies by doing them in small units, I do not think we would have any complaints about ensuring that notification was still required. It is where you are forcing people into consultation who are never going to be made redundant, yet they find themselves under the scope of that. Splitting those two things apart—so you would still have the notification, but you would not necessarily have the consultation for those who are unaffected—is something we are exploring. I do not want to say that that is the silver bullet that will solve things. We have not even discussed that collectively as an industry; we are just trying to consider what options might be on the table.

• 26 Nov 2024 · Employment Rights Bill (Second sitting) · Hansard source

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  Q 33 Thank you, Ms Vaz. It is a pleasure to see you in the Chair and to serve under your chairmanship. Good afternoon. May I start with Mr Simpson? UKHospitality has been quite critical of this Bill in the media and in a wider setting. You have just said you represent a very large number of people. Do you think after this Bill is passed and becomes an Act—I think we can safely assume it will, with the parliamentary arithmetic at the moment—there will be more, or fewer, people employed in hospitality in the United Kingdom? Allen Simpson: I would slightly reject your characterisation. I think in general we agree with the principles behind the reforms, and many of the substantial reforms themselves. There are areas where we will have to nuance the detail of things like reference periods and zero-hours contracts—we will get into that, I am sure. My bigger concern, however, is the aggregate costs of what we saw in the Budget with the regressive impact on lower earners in particular. Will this create more or fewer jobs? I think the Government’s analysis suggests that it is fewer, but let us balance that against making sure that workers’ rights are protected.

• 26 Nov 2024 · Employment Rights Bill (Second sitting) · Hansard source

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  Q Thank you, Ms Vaz, and good afternoon to the witnesses. In the last session, it was suggested that this Bill might lead to the re-unionisation of the economy. Do you agree with that? Paul Nowak: I think this will be the biggest upgrade to workers’ and trade union rights in a generation. It is very likely that we will see increased unionisation as a result of the Bill, and I think that would be a good thing. Bodies as disparate as the International Monetary Fund and the OECD have talked about the benefits of unions and collective bargaining in modern economies—benefits in terms of improved productivity and business performance, but also benefits for workers in terms of increased pay, better access to things like skills and more equal and fair workplaces. I do not think there is a direct link; you do not pass a piece of legislation and trade union membership and collective bargaining go up, but the repeal of the Trade Union Act 2016 and the repeal of the minimum service level legislation—the strikes Act—and other measures in the Bill will help unions to organise. That will be good for employees and good for workers, but good for employers and good for the UK economy as well.

• 26 Nov 2024 · Employment Rights Bill (Second sitting) · Hansard source

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  Yes. Gemma Griffin: No, is the answer, because we are very much trying to create a situation in which our colleagues have rights and are treated fairly. The most important thing is that there is a level playing field and that whoever operates in the same space as us, the law applies to them. If we are all UK-based and have UK contracts, I imagine that would be the case. To make it clear, my area of expertise is seafarers. I am not really involved on the UK side, so I do not want to overreach and maybe show my absolute ignorance in that respect. I apologise.

• 26 Nov 2024 · Employment Rights Bill (Second sitting) · Hansard source

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  Q Mr Carberry, if I can come to you, looking at those you represent, what is it in the Bill that you think is right, wrong or needs amendment? Neil Carberry: I will not repeat what Allen said about the aggregate cost of the Bill, but clearly it is an enormous piece of legislation, coming at a time when businesses—particularly consumer-facing businesses—have been through the pandemic, are carrying more debt and are struggling to drive the growth that the Government want. Among my members, as with many business organisations, the tone of the debate about the Bill was changed by the Budget. That was particularly around the shift on the threshold, which directly pushes up the costs of all of the people for whom an employer’s decision to hire is maybe more marginal. I associate myself with Allen’s comments on that. More specifically, for those who are not familiar with it, our sector places 1 million people into new permanent jobs every year, but it placed 1 million people as temporary workers into workplaces today. So I come at this from the point of view of what do those people need to have good, positive, healthy working lives. Colleagues may remember the attempt to change the conduct regulations to allow agency workers to replace striking workers, which we opposed, because at the REC we believe in protecting temps and putting them in the right space. The most important thing for our sector is the proposal to apply the same tests and rules on zero-hours contracts to agency workers as to directly employed workers. I will be really frank about that: there is a power in the Bill, we have been through the consultation, and we cannot see how any of the approaches in the consultation work. For some of the reasons that Allen has set out, agency workers are well protected. They benefit from the Employment Agencies Act 1973, from their own set of conduct regulations—the Conduct of Employment Agencies and Employment Businesses Regulations 2003, passed by the last Labour Government—and from the Agency Workers Regulations 2010. There is a lot we can do to deliver the Government’s commitment to more certainty for agency workers—it is just not by applying the powers in the Bill. We fear that the Government are trying to avoid direct employers moving to agency to avoid the powers in the Bill. A few direct employers doing that is not worth damaging the employment prospects of 1 million people. For instance, if a supply teacher in a school has worked the autumn term to cover a sickness absence, and then the absent teacher comes back, we cannot see how giving that supply teacher a right to a contract from that school is good for the school or the supply teacher. Ultimately, we think that we will just see a move to using more overtime and lengthening the working hours of existing staff. That will be net negative for the workforce. I think there are things that we can do on the zero-hours rules to protect agency workers, but it is not applying the proposals in the Bill. More generally, I think our members would say that the Bill feels a little undercooked in its thinking. I think it is a very quick Bill, and that there is quite a lot in it that employment lawyers and our members are looking at and thinking, “How would that work?” A classic example would be the collective consultation sections of the Bill. I do not think it is in anyone’s interests for large companies employing thousands of people to be stuck in perpetual collective consultation when they are shutting down one site with 20 people in it. That is just an example of one of the things that maybe need to be worked out through regulation—lots of this is in regulation—but we need to ensure that we are not putting up barriers to employment with the Bill.

• 26 Nov 2024 · Employment Rights Bill (Second sitting) · Hansard source

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  Q How many of the employees in the UK hospitality sector are currently on zero-hours contracts? Allen Simpson: It is about 17% in total. If you look at who those people are, they are largely who you would think—students and people with caring responsibilities. I think about my mum, who worked on what we would now call a zero-hours contract while raising me and my brothers. That 17% is going to skew younger and largely skew female. There is a really interesting question around making sure you have a legal structure that allows people who want to work flexibly to do it, but also making sure that the people who want to work in a more settled, structured way—maybe because they have more responsibilities financially—to be able to do that as well. I broadly think the proposals in the Bill are the right ones. I have a question about the reference period. I know Ireland has a 52-week reference period for estimating what your set of regular hours is, which possibly feels too long. I have always held 26 weeks in mind as a number which allows you to cope with things like seasonal working, but equally allows the worker the right to choose whether they want to work flexibly or in a more fixed way.

• 26 Nov 2024 · Employment Rights Bill (Second sitting) · Hansard source

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  Q You used the term “working people”, which is something that some struggle to define. Can you define “working person”, and does that include someone who runs a business? Are they a working person? Hannah Reed: There are already statutory definitions in legislation of who is a worker. It will generally be workers—in some instances, it will be employees—who will benefit from the range of rights in this legislation. Our trade unions are also looking forward to working with the Government on their forthcoming review of employment status, the purpose of which may well be to look at extending protections for self-employed workers, such as freelancers and others. Unite represents a lot of self-employed workers in the construction industry who are not self-employed by choice, and they have fewer rights as a result. We would like workers who face a higher risk of injury in the workplace and who often lose out on pay and conditions, as well as freelancers and others, to have full employment rights. We are working initially from the definitions of “worker” and “employee” that are set out in law, but we very much look forward to the Government bringing forward measures to extend protections to all working people.

• 26 Nov 2024 · Employment Rights Bill (Second sitting) · Hansard source

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  Q This is a question to all of you, off the back of the last answer. It was suggested during the last evidence session that this Bill does not go far enough. It is evident from the declarations made at the start of the sitting that the relationship between the trade union movement and the Labour party is symbiotic, so what more have you asked the Government to put into the Bill? Where do you want it to go further? Mick Lynch gave a very clear answer in the previous session. What are your respective unions’ greater asks of this Government? Paul Nowak: Can I make a point first about the symbiotic nature of the relationship between Labour and the unions? We certainly have a shared history and shared values, and in some cases we have unions that are affiliated to the Labour party. The TUC represents those 5.3 million workers regardless of who is in government, and it does not have a formal relationship with the Labour party. Our job as trade unionists is always to want more and better for working people. I think it is important to recognise that this will be the biggest upgrade to workers’ rights in decades—I was going to say in a generation, but it is more than that. It will directly benefit millions of working people. I came in at the end of the last panel, and Mick was talking about sectoral collective bargaining. The Government have indicated that the first fair pay agreement will be in social care. We would love to see that approach—those fair pay agreements—rolled out to other sectors of the economy. That is a point that we will make going forward. It would be churlish not to accept that the Bill is a big upgrade to workers’ rights and to union rights. This will be the first time that a Government have repealed anti-union legislation in my 35 years as a union activist, and I think it is really important that they do. If we take the minimum service levels legislation as an example, we always warned that it would be unworkable. It was red-flagged by the Regulatory Policy Committee and by the Government’s own impact assessment when it was introduced, and not a single employer has ever used the legislation. We will be positive; there will always be more that we would like any Government to do on behalf of working people, but this is a really important piece of legislation. Maggi Ferncombe: I agree. To be frank, as the largest trade union in the country, the political stripe of the Government does not matter to us; we will obviously do what we can to improve public services and the terms and conditions and salaries of workers in those public services. You asked what more we would want, but, to be honest with you, we want an extension of what is already in the Bill: the opportunity to have some sort of legal mechanism for collective claims. Individual workers, unions when they are involved, employers and employment tribunals spend hundreds and hundreds of hours trying to deal with individual claims from individual workers. An unintended consequence would be the savings to employers from not having to deal with individual claims that take years to go through tribunals. If there was an opportunity to have a mechanism to deal with it collectively, it would save everyone time and money, including employers. Dave Moxham: We have a disproportionate number of zero-hours contracts in Scotland, probably because we have proportionally more small businesses as part of the UK economy. We welcome the moves in the Bill to address that. I heard the evidence given by the last panel, and from our perspective the majority of employers do not use them but they have an intensive impact. For the last 10 years, the STUC has run a campaign called BetterThanZero, which goes out daily and talks to these workers, who are predominantly, but far from all, young workers. The impact on their lives—ergo the impact on the economy because of their lack of stability, certainty and security—has a far wider effect than on just the individual and cannot be overestimated. When we look at the provisions currently in the Bill, we certainly believe that what defines a short-hours contract and some of the other things that have yet to be decided need to be quite strong. If you go on to the internet, you can already see discussions among employers about how they will circumvent the proposals, so that will be one area where we will be looking for strength. Hannah Reed: There is an awful lot to welcome in the Bill, and I will not take up the Committee’s time by listing it. We can submit evidence to you on equality rights, trade union rights and so on. Like all Committee members, I am sure, we are keen to ensure that the Bill comes out as watertight legislation that makes a real difference to people’s rights. There are some elements of the Bill where we would want to continue working with you as a Committee and with the Government to tighten up what we consider to be potential loopholes, and I will briefly name three areas. The first is the provisions on fire and rehire. Unite’s concerns are that some of the uses of heavy-handed tactics by employers that we saw during the pandemic and since could still be lawful under this Bill. We are concerned that employers may be able to justify fire and rehire in certain circumstances, and our view is that there needs to be a total ban. We are not confident that the employment tribunals will look behind the corporate veil or question an employer’s arguments for why they needed to use fire and rehire tactics, so we do not think it goes far enough. Importantly, there is nothing in the Bill at the present time that stops the employer from sacking the workforce. While we welcome the Government’s consultation on interim relief, we, like previous participants. would like to see some measures before that that stop the employer and require them to open their books to demonstrate to forensic accountants that changes are needed, and to provide a genuine opportunity for negotiation with trade unions. We are very equipped; we know what needs to be done if changes are needed. Secondly, we would like to see further measures in the Bill to extend collective bargaining. Very briefly, we recognise that there are important measures on statutory recognition in the Bill, but we would like the Government to consider going further, particularly to ensure that laws prevent the abusive practices seen in the recent Amazon campaign. We would also like faster routes to recognition. Workers often have to wait for six months and are repeatedly asked, “Do you want statutory recognition?” They repeatedly say, “Yes, we want statutory recognition,” but employers are given time to fight against the workers’ will. We think there should be a faster route to automatic recognition. The last point I would raise is on access. I have already talked about the benefits of working people having the opportunity to meet with trade unions in the workplace, to tackle discrimination and press for better pay and conditions through negotiation. We would like to ask the Government to look at the access measures, to see if there are ways of having a default or free-standing right of access so working people have a genuine right to democracy and representation at work.

• 26 Nov 2024 · Employment Rights Bill (Second sitting) · Hansard source

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  Q Before the other witnesses come in, the impact assessment suggests that the Bill will result in a £5 billion cost to business, and we heard this morning at a session with representatives from business that that was actually a lowball estimate. How do you work out that it might lead to increased wages if the cost on business is, in fact, going up? Paul Nowak: It is important to put that £5 billion into a figure; that is something like 0.4% of the overall wage bill. The TUC has published research today, again involving very moderate estimates. In the impact assessment, the Government talked about potential benefits to the economy from this Bill, in terms of things like improved staff retention, improved productivity and bringing back into work people who are currently outside the labour market—there are now 900,000 or so less people in the labour market than there were before the pandemic. At a very moderate estimate, we believe that that will generate £13 billion for the UK economy. For a small number of employers, there will undoubtedly be increased costs. If you do not pay sick pay from day one at the moment, or if you use zero-hours contracts, it may well cost you more. Those benefits will transfer directly to low-paid insecure workers. I think it is really important to make the point that most employers do not use zero-hours contracts. Most workers in this country are entitled to sick pay from day one. This Bill levels the playing field for those good employers who, at the moment, are in danger of being undercut by those who play more fast and loose with the livelihoods of their workforces. Maggi Ferncombe: From Unison’s perspective, the Bill means that in certain sectors, workers will no longer be dispensable. There are some really perilous conditions out there for some of our workers, and we all know that valued workers who are paid a good salary and have better security at work are more productive. In our sector, we find that the public service is then better for service users, it is better for society and it will be better for the economy. Dave Moxham: I will be brief. We have a productivity problem in Scotland and across the UK, and that is largely because workers are not, either collectively or individually, being sufficiently engaged or consulted, and they are not being sufficiently used to drive productivity and success within their own workplaces. Trade unionism, in my experience, helps with that. We are day and daily inundated with problems in workplaces that are not unionised, which have to be dealt with in other ways. The employment tribunal is full of these situations. Our experience, and it is long held, is that trade-unionised workplaces actually avoid those problems. I would say that we are fortunate in Scotland—it is not perfect—to already have a Government who recognise that collective bargaining and fair work are drivers for success, and I very much hope that this Bill will add strength to that for us and see that approach reflected across the whole of the UK. Hannah Reed: Thank you very much for the question. We represent working people—that is what trade unions are. Overall, we represent nearly 7 million working people within this country. Being part of a trade union brings clear benefits for working people. It provides them with better legal representation and representation in the workplace to resolve issues at work. It will often provide them with better access to training, and it will provide them with better career opportunities. We very much hope that this Bill will encourage and enable more people to make the positive choice of joining a trade union, and that could be done by providing a right of access to millions of workers. Regrettably, the majority of workers in this country do not have the option at the moment to meet with a trade union in the workplace. We hope that the Bill, through measures on the fair pay agreement, the new negotiating arrangements on school support staff and the changes to statutory recognition, will enable more workers to have a say over their pay terms and conditions. We also hope that, through the introduction of statutory equality rights, the Bill will ensure that issues such as harassment, bullying, sex discrimination and unequal pay in the workplace can be properly addressed in this country to ensure that all companies meet those standards. We know there are good companies that meet good standards in the workplace, but we would like to see more companies and organisations meeting those standards, and we very much hope that this Bill is a starting point for ensuring that everyone has a decent working life.

• 26 Nov 2024 · Employment Rights Bill (Second sitting) · Hansard source

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  Q We heard from witnesses in previous sessions that they worry that some measures in the Bill—on zero-hours contracts and some of the fire and rehire potential unintended consequences—will make some employers more reticent to take on a new hire, or to take a gamble on someone who might need a chance or second chance, or whatever it might be. Is that reflected in either of your sectors? Jim Bligh: Unfair dismissal and the probation periods are a concern for us. Most of our sector uses three or six-month probation periods now. About 85% of our members have told us that that is what they will use. About 6% use 12 months. There would be, I think, a concern about a nine-month period—the reduction from two years. It is critical that performance management from day one does not put a significant burden on SMEs in particular, and it is important that we keep the flexibility. If something is not right for the employee and not right for the employer—that performance is not there, that quality standards or whatever are not met—there should be flexibility in ending that employment relationship, on both sides. What concerns us about the Bill’s proposals is that young people or people re-entering the workforce—which rightly is a priority for Government as well, and I note that Liz Kendall is speaking about this in the House at the moment—could be shut out under the changes that are coming through in the Bill. Our proposal would be to revert to a 12-month probation period. Obviously, people automatically qualify for unfair dismissal on some elements. It is right that those elements are retained, but it is important to us that you keep that flexibility from 12 months, that you have a light-touch approach and a process there as well, but also that we have enough time to implement. What concerns us is that we are talking now about changes that will come in, I think, in two years’ time—that is a commitment from Government. That period is welcome, but we are not certain what the final provisions of the Bill will be. There is a long commitment to consultation, which we also welcome. Our proposal would be to implement two years after Royal Assent, to make sure that that concrete security and guarantee is there and that the goalposts are not shifted for employees and employers as they start. Jamie Cater: I would echo that and agree with those comments. Stepping back slightly to look at the bigger picture, it has become difficult for us, with members, to separate out the impact of the legislation and the impact of the autumn Budget—the increase in employer NICs in particular, but in general the tax burden on businesses. That, taken together with the measures in the Bill, increases the cost and the admin associated with taking on people. There is a risk that that disproportionately impacts people on the edges of the labour market, I suppose. It is very welcome that the Work and Pensions Secretary is today talking about how to reduce economic inactivity, particularly focusing on skills and health. We really support that focus, but there is a danger that the measures in the Bill, combined with the total cost impact, will make employers less likely to take that risk on someone. On the protection for unfair dismissal in the statutory probation period, we typically hear from members that the usual approach would be to have a six-month probation period in an employment contract. They might then have a bit of additional flexibility for someone who is a borderline candidate if they need to be kept on probation for a bit longer, perhaps if they need a bit more skills training, experience or additional guidance in something before a firm decision is made about permanent recruitment. Members often talk to us about effectively a six plus three model, where there is a contractual six-month probation period with the flexibility for an additional three months’ probation if there is a bit of uncertainty. The Government’s stated preference for a nine-month statutory probation period feels about right. That is probably the minimum; we would not want to see it go any lower than that. I think our preference would be 12 months, just to give that additional leeway, but nine months is probably about right for what we see reflected in standard practice from our members.

• 26 Nov 2024 · Employment Rights Bill (Second sitting) · Hansard source

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  Q Good afternoon, gentlemen. I will ask you the same questions I have asked most witnesses today. This is a thick Bill; there are lots of measures in it. In the interests of the people you represent in food, drink and manufacturing, which of those measures have the Government got wrong? Which are in the right ballpark, but should be amended? And which are right? Jamie Cater: It is worth starting by saying that we welcome the underpinning principles of the Bill. UK manufacturers are committed to providing good, well-paid work. We think that genuine exploitation and bad practice in the labour market should be addressed, so we are supportive of a lot of what the Government are trying to achieve through this legislation. There are specific measures that reflect policy recommendations that Make UK has made previously on behalf of manufacturers—for example, the extension of eligibility for statutory sick pay, making it an entitlement from day one of sickness and removing the lower earnings limit. We think that is the right thing to do, although we would like to see additional financial support for the smallest employers to help with the cost burden of that—a rebate scheme, as there was during the covid-19 pandemic. Our members also support some of the measures on things such as equal pay, parental leave and family-friendly rights. I would list four areas of concern for us: two on individual rights and two on collective rights. On individual rights, we have some concerns around the detail of the implementation of the right to guaranteed hours. Some of that detail around the definition of regular working hours and the scope and structure of the 12-week reference period for that right to guaranteed hours will come forward in the secondary legislation. Secondly, we have concerns about the structure of the statutory probation period that will accompany the day one protection from unfair dismissal. On collective rights, the first area of concern is around consultation requirements for collective redundancy and the impact that that will have on businesses, particularly large businesses, in our sector. We have concerns about the extent to which they will be required to consult and the potential disruption associated with that. The second area is dismissal and re-engagement, or fire and rehire, where there is a very high bar set. We think it is right that there is a robust approach to that practice and we have supported previous measures, such as the existing code of practice. But we are concerned that the approach taken in this legislation might restrict the ability of employers to take the action they need to take and that the way the measure is worded in the Bill is currently too restrictive. Jim Bligh: We pride ourselves on being good employers of the half a million people around the country who are sector employees. We simply would not be able to feed our population of 70 million people without their commitment, hard work and dedication. We know that a flexible labour market is the hallmark of a growing economy, and we are keen to protect that. We are very receptive to a lot of the ideas in the Bill, thinking about maternity and paternity provision, the pregnancy improvements, the lower earnings limit for the statutory sick pay rules—which is a sensible thing now we have moved away from that being a state benefit —and the recognition of the importance of flexible working, which our sector offers, too. We are strongly supportive of a single enforcement agency. There are some areas we would like Government to look at in a bit more detail, and to consult fully with businesses in a way that follows best practice, through 12-week consultations in particular. We note with interest the concerns that the Regulatory Policy Committee expressed yesterday in its analysis. For us, there are five areas where we think Government could work with businesses and unions to come up with a pragmatic solution that will help meet the objectives of both. For us, those are around unfair dismissal and probation periods; collective redundancies and similar concerns to those other witnesses have expressed today; some technicalities around zero-hours contracts and, specifically, definitions; flexible working and the admin burden that that poses for smaller businesses, now the burden of proof is shifting; and some concerns about the secondary powers of Ministers, which are quite wide-ranging, particularly on ballot thresholds. Broadly, however, we are receptive to the ideas in the Bill, and we look forward to working with Government to implement them.

• 26 Nov 2024 · Employment Rights Bill (Second sitting) · Hansard source

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  Sure. Martyn Gray: No, is the very short answer to that. It needs to go further in terms of protections for those who work at sea. There are still monumental gaps in the protections that are afforded to seafarers compared with the protections afforded to land-based workers, even under existing employment legislation, and those gaps still need to be closed up. This legislation comes some of the way to addressing some of the challenges we saw in the wake of the decision by P&O Ferries to terminate, without notice and without consideration, 786 people in March 2022, but it still does not go far enough to place the rights and protections of those who work at sea on parity with the rights and protections of those who work in shore-based roles and with shore-based employment contracts. More still needs to be done, and more can still be done, that will allow for greater protections to be delivered for those who work at sea. That is fully within the remit of this Parliament to legislate for. Mick Lynch: From my point of view, I do not think there will be unintended consequences. I hope the intended consequences go far enough, but maybe we will have to have more legislation. We had lots of legislation against the unions under previous Governments, so hopefully we can get more legislation in favour of workers and their organisations. The Bill does not go far enough, but we can improve it during this process. One of the things we would like to see is the power for trade unions to get redress—injunctive power—against people like P&O, which was never considered. We were told that if we took action against P&O—and there was a slim possibility of it—we could be liable for all its revenue loss for every day of trading, which could have been up to £15 million or £20 million a day. That is impossible for workers and their organisations to take forward. You have to remember that P&O deliberately broke the law to get rid of its workforce and to undermine good shipping companies. We have employers such as P&O and Irish Ferries working out of our ports that undermine good businesses. I just caught the end of the previous session, when the witnesses hoped that there would be a lifting of all boats—to use that pun—to create a playing field that is fairer. It will never be completely level, but it would be fairer on all the good businesses in Britain—British businesses and those working in Britain—to make the pirates, which is what we consider P&O to be, come up to the standards of everyone else doing business here. Businesses should treat their workers well, treat the environment well and treat their passengers well. If you do all those things, you will run a successful business despite a marginal increase in overhead. Let us not forget that people like P&O are dramatically resourced by the richest people on the globe. P&O deliberately took that step to exploit our laws—as poor as they were, left to us by previous Governments—because it knew it would get away with it. What P&O has got to be aware of in the future is that it will not get away with it without consequences for its business and reputation. Unfortunately, the previous Government allowed P&O to shed its skin and leave it behind, along with all those people it made unemployed, and carry on as if nothing had happened. That is a shame on all those people who allowed P&O to do that.

• 26 Nov 2024 · Employment Rights Bill (Second sitting) · Hansard source

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  Q Thank you for being with us. Can you give us your view on whether the Bill goes far enough to combat the issues that you campaign on, particularly women’s rights at work? Where would you like to see elements of it amended, either to make it stronger or to get rid of things that might have unintended consequences, and are you concerned about any particular areas of the Bill either not delivering what they say they will or delivering something completely different? Jemima Olchawski: At Fawcett, we really welcome the Bill. Overall, we still have an economy and workplaces that consistently disadvantage and exclude women. That means that they are much more likely to be on zero-hours contracts, to be in low-paid work and to be held back by a lack of access to quality flexible part-time work. Each of those issues is intensified for most black and minoritised women, and for disabled women. The situation results in serious consequences for individual women. We have a gender pay gap of just under 14%. On average, women take home just over £630 a month less than men. It also has a detrimental impact on our economy, because it is a marker of the ways in which women are not fully participating or contributing to the economy at their full potential. Estimates indicate that that means we are missing out on tens of billions of pounds of GDP. We strongly support the measures as an important step towards redressing that balance. In particular, we are pleased to see the inclusion of equalities action plans as an important way to get employers to drive forward progress on the gender pay gap. We are glad to see the emphasis on the importance of flexible working and the day one right to statutory sick pay, which will have a disproportionate beneficial impact on women, as well as further protection from sexual harassment in the workplace. Some 40% of women experience sexual harassment at some point during their career. There are areas where we would like to see additional inclusions or things going further. Flexible working is incredibly important for women who have caring responsibilities and continue to do the majority of unpaid care, and having access to flexible work is vital to enable them to progress and earn to their full potential. We would like to see a duty on employers to advertise jobs as flexible, rather than a situation where women have to wait until they are in a job before they can begin that conversation. You cannot move into a new job if you are not sure whether you will be able to replicate the flexibility that you have in an existing role. That leads to women being under-employed and their skills underused. The day one rights to maternity, paternity and parental leave are important, but they have to be remunerated. There has to be a day one right to pay if we actually want people to take it. Particularly if we want men to take on more caring roles, we need to make sure we have a refocus on remunerated leave, and that includes parental leave. We welcome the fact that there will be a review, but we need to think about this as part of those measures. I would like to see more around equal pay in the Bill. Measures could be taken that would support women to access fair pay, such as pay transparency and ending salary history questions. The last thing I would like to see more on is making sure that there is proper enforcement of those rights—that the enforcement bodies are properly resourced and have the teeth to ensure that the rights really hold. Joeli Brearley: It is a big question that you have asked. I support everything that Jemima has just said. We are very supportive of the Bill, but I think there is a lack of clarity on some of the areas that we are particularly interested in. On flexible working, we are really pleased to see that the Government want to make it the default way of working. That is really important, but we need to know exactly how, and what mechanisms will be in place to do that. The current law on flexible working isn’t working. We want to see an advertising duty as well, which I am sure we can explore in a bit more detail later. We are also very supportive of parental leave being moved to a day one right. It is kind of amazing that that is not in place already. But without it being remunerated, take-up will be very low. We would have liked to see more on parental leave. We have a shockingly low rate of pay for maternity. We have the worst paternity benefit in Europe. This is causing huge problems for families, particularly new families that have just had a baby. They are getting themselves into terrible amounts of debt. Also the way that our parental leave system is structured means that women are responsible for the care of a baby. They tend to take long periods of time out of work, whereas men tend to go back to work very quickly. They fall into the role of breadwinner, and the woman falls into the role of caregiver, and that continues for the rest of their lives—which is why there is such a large gender pay gap. The redundancy protections are great. Again, we are very pleased to see that, but we need specifics about what it means. We would like to see that pregnant women and new parents can only be made redundant in exceptional circumstances. By that we mean when a business is closing or perhaps when a service has stopped being delivered. It is very difficult, if you are made redundant when you are pregnant or have just had a baby, to get another job. Often you are made redundant and then cannot access statutory maternity pay. These are very particular circumstances. We know that many women are still being made redundant when they are pregnant or when they are new mums; 17% of calls we get to Pregnant Then Screwed are related to redundancy, so it is a big problem. What we do not have at the moment, but really need, is data that shows us what is happening on the ground. A report was done by the Equality and Human Rights Commission under the coalition Government that found that 54,000 women a year are pushed out of their jobs for getting pregnant or for taking maternity leave, and 77% of new mums experience some form of discrimination. That report was done in 2016, and there was a guarantee at that point that the report would be done again five years later. It is now nine years later and we still do not have any new data to show us exactly what is happening on the ground. Without it we are making decisions in the dark, so we would really push for that report to be done again. We would have liked to see something in the Bill on non-disclosure agreements. Our research found that 435,293 mothers had been gagged by non-disclosure agreements when experiencing some form of discrimination. It is a serious problem. Again, we do not know what is happening in companies across the country. Women tend to experience this form of discrimination and are then forced to sign these agreements and are given a low amount of compensation. They suffer mental health consequences because of that. We want to see the UK follow what Ireland has recently done, so that non-disclosure agreements cannot be enforced unless the claimant wants them to be. We would also have liked to see something in the Bill on miscarriage leave, because at the moment there is no right to any leave or pay if you miscarry before 24 weeks. We would have liked to see something on fertility treatment. As many of you will know, we have a baby crisis in the UK—we are not having enough babies. We want to encourage people to have fertility treatment, so we need a legal right to time off. We would like to see something on reasonable adjustments. There are currently reasonable adjustments if someone has a disability, but not if they have a dependant with a disability. Many mothers of disabled children are struggling in the workplace because they need time off for appointments, or whatever it may be. We would like to see a requirement for all employers to publish parental leave policies.

• 26 Nov 2024 · Employment Rights Bill (Second sitting) · Hansard source

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  Q Do you have any views on the Bill’s provisions on trade union facility time? Mick Lynch: Not particularly. We make arrangements with our employers—we have private sector employers and public sector employers—through collective agreements. I imagine that we will always create decent arrangements with all our employers, whether they are road transport, rail or maritime, about appropriate release for our people, so that is not a thing that concerns us overly at this time. Martyn Gray: I have no particular concerns about the way facility time seems to be structured. I think overall it will prove to be beneficial. I know there are some in the trade union movement who would like to see more on that, but again, I think that, with the maritime aspect and the practicalities of working around that, what is proposed in the Bill is helpful. Gemma Griffin: There is not a problem from our perspective. We see both RMT and Nautilus as partners in our endeavours to do the right thing for our people, so we are fully supportive.

• 26 Nov 2024 · Employment Rights Bill (Second sitting) · Hansard source

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  Q Have you had any feedback from your members on their willingness going forward to take on the very people you have just talked about—employees with caring responsibilities, students, people with complex situations in their lives who find a zero-hours contract useful—and whether some of them are reticent about taking people on in the new circumstances that this Bill would bring about? Allen Simpson: I come back to the point that you need the right legal structure. I think it is legitimate for someone who in practice is working 30 hours a week regularly and has been doing so for the last year to ask for that to be reflected in a different form of contract. That is absolutely right. It is worth saying that the data shows—and it does not matter how you look at this—that most people on zero-hours contracts are happy with that. In fact, if you advertise a zero-hours contract, you will get more applicants. To a degree, as long as it is in the gift of the employee to say, “Well, I am working these regular hours and I want that reflected in a permanent contract”, that is the right balance. However, it is important that the Government move their thinking, as they have, to recognise that zero-hours contracts are a really important social fairness point because they allow access to work for people who cannot necessarily offer their employer set hours every week—again, I come back to my mum when I was a kid. Having that distinction in law is really important.