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10 May 2022

Boris Johnson has passed up the chance to protect workers and businesses

In ditching the Employment Bill, the government has left workers exposed to inflation and insecure contracts.

By Will Dunn

The vague promises of the Queen’s Speech, delivered this morning by Prince Charles, allow the government to pretend it has done something about issues it hasn’t addressed, and might not get started on for years to come. Arguably the most worrying example of this is the Employment Bill, promised in the Queen’s Speech shortly after the 2019 general election, which has spent two-and-a-half years on the shelf, and appears likely to remain there, having been omitted once more from the government’s legislative agenda.

As inflation heads towards 10 per cent, pay rises are making their way into some industries, but for the majority these rises won’t come close to keeping up with prices. The energy analyst Cornwall Insight expects the price cap to rise from the £1,971 it was set at in April to almost £2,600 a year in October, and for prices to remain high well into the next decade; Andy Haldane, former chief economist at the Bank of England, agreed this week that inflation could “stick around for […] years rather than months”.

At the same time, work in the UK has become more precarious. In the five years after the Brexit vote, the number of British people working for “gig economy” platforms almost tripled to 4.4 million, accounting for 15 per cent of the UK workforce in 2021. Millions more are on variable-hours contracts, which place workers in a constant state of uncertainty. Half of Britain’s low-paid workers don’t know if they’ll be working next week, which makes it very difficult to plan spending, transport or childcare, and gives managers disproportionate power over workers. Julian Richer, founder of the Good Business Charter and the campaign group Zero Hours Justice, calls these practices “a Petri dish for abuse… if you know that if you raise any objections or criticisms of your employer, you may not get hours next week – it’s a recipe for disaster”.

Precarious work is also banking decades of higher costs for the NHS; in 2019, the World Health Organisation found that income insecurity was the single biggest cause of the gap in health outcomes between the poorest and richest people in 36 countries. Work was four times as important to health outcomes as access to quality healthcare.

Richer, who built his Richer Sounds chain into a £170m-a-year business, says most businesses benefit from worker protections: “There’s no question that the better we treat our people, the better the results of the company is going to be. A happy workforce gives better service, turns up on time, is more loyal, shrinkage drops considerably, and people don’t feel that they’re forced to steal because they’re not earning enough.”

However, Ross Mudie, research analyst at the Centre for Progressive Policy, an economic think tank, says some businesses do benefit from less well-protected workers. In a recent report, the Office for National Statistics found that transport and storage businesses – warehouses and courier companies – had almost doubled in ten years, growing by 88 per cent as the growth of online shopping, boosted by lockdowns, moved much of the retail sector behind closed doors.

Much of this growth is accounted for not by retailers themselves but by agencies that compete for contracts: “Technically, [retailers] don’t hire those warehouse workers. It’s done through subcontractors… having the different layers to it means that there’s a lot of separate targets”, Mudie observes. Achieving these targets involves a fairly brutal selection process among workers who are seen as disposable.

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Many of these warehouses are found in the “golden logistics triangle” of the Midlands, which was also one of the areas of the UK where the Leave vote was strongest in the EU referendum. Many of these voters rightly felt that while decades of being European had brought them new protections in law, it hadn’t stopped their pay stagnating and the industries in which they worked declining. In the ten years prior to the Brexit vote, the number of people working on zero-hours contracts increased by almost three quarters of a million

Boris Johnson’s government was re-elected in 2019 on a manifesto that recognised this fact with a detailed section on “fairness in the workplace”, which included commitments to replace the protections given to EU workers – limits on working time, paid holiday, health and safety regulations and parental leave – with British laws. 

The need for these laws became apparent when the newly elected Prime Minister passed a Withdrawal Agreement Bill that did not contain clauses on workers’ rights. Instead, his government committed to realising its manifesto pledges in a new Employment Bill.

That bill appears, from today’s announcements, to have been parked in favour of a new focus on “Brexit opportunities”. Chief among these, as outlined in Ian Duncan Smith’s embarrassingly named “TIGRR” report, David Frost’s review, and the Brexit Freedoms Bill announced today, is the opportunity to strip out EU rules that have been retained in British law. Having declined to include worker protections in the Withdrawal Agreement Bill or to replace them with new British law via an Employment Bill, the government has declined another opportunity to protect restaurant workers from employers who may wish to help themselves to their tips, or pregnant women from being made redundant, or working parents who need flexible hours to care for their families.

Sometimes it takes a crisis to turn the commitments of the Queen’s Speech into legislation: the Economic Crime Bill was sat on for four years until Russia invaded Ukraine, at which point it was hastily dusted off and watered down. But precarious employment and the cost of living are already crises in the UK, where the level of in-work poverty is the highest on record and the majority of households in poverty have at least one adult in work. The UK is entering a recession, a global economic slump is now widely expected, and the government has responded with laws to ban climate protests and guarantee right-wing culture warriors speaking engagements at universities. Few businesses, and fewer workers, will thank them.

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