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EU Leaders Must Seek A Brexit Deal That Protects Against A Race To The Bottom For Workers' Rights

05/05/2017 17:12
Ben Birchall/PA Archive

Somewhere in a galaxy far, far away, Theresa May's Brexit strategy is taking shape. I hope she will be brought back down to Earth by a new report on the working people, in both the UK and across the EU, of Britain becoming a deregulated tax haven after Brexit.

'Could a bad Brexit deal reduce workers' rights across Europe?' was commissioned by the TUC from the Work Foundation. It reviews the evidence that a 'race to the bottom' could be triggered, with Britain undercutting the EU by offering global investors a cheaper and less regulated workforce.

The authors' conclusions will no doubt worry EU nations, especially after Jean-Claude Juncker's warning that Britain and the EU will commence negotiations light years apart. They say that leaving the EU without a deal in place is not only dangerous for UK workers - it poses a threat to EU workers too.

The report finds evidence that strong rights at work are common to many successful economies. It reinforces the trade union view that positive outcomes come from pursuing the high road of decent jobs with high pay, high skills, and high productivity. This should encourage both negotiating parties to put strong workers' rights at the heart of the deal.

But the report also reinforces trade union concerns about the impact of deregulation on working people's lives and future prospects. Taking the low road would expand the share of the economy that is composed of insecure, poorly paid, low-skilled, low-productivity jobs.

The authors find that a 'polarised race' is the most likely outcome if Britain pursues a deregulation strategy after Brexit. The impact would be focussed on those in low-skilled, low-paid and low productivity work. This would lead to greater labour market inequality, with labour standards diverging for workers at different ends of the spectrum for productivity and skills.

In a worst case scenario, lobbying for deregulation across the EU would gain traction in response to Britain's actions, leading to the erosion of EU workers' rights too.

The UK Chancellor Philip Hammond has explicitly warned that the UK may pursue a low-tax, low-regulation economic model if no deal is reached.  So this outcome is not a fanciful proposition, but a clear and present danger.

Even if the UK does not actively reduce workplace protections, harm could be done. Take the current proposals for the 'European Pillar of Social Rights', which include new rights to paid parental leave, and new protections for insecure workers. If the UK was to seek a competitive advantage by withholding these improvements from Britain's workers, it could undermine support for the changes from crucial stakeholders within the EU.

Trade unions in Britain and the EU will continue to work together throughout Brexit negotiations and beyond to protect the common interests of our members. We know that the best future for working people will come from ongoing cooperation on labour standards, not competition.

I hope this report will dispel any complacency on either side of the negotiations about the consequences of failure to reach a good deal.  And I hope it will improve understanding of the importance of an agreement that covers not just existing workers' rights, but future improvements too.

A good deal would have working people's rights written into the heart of it. It would include a clear commitment to maintain a level playing field, complying with the same minimum EU labour standards as they stand today, and as they are improved tomorrow.

Britain's working people do not want their nation to become a bargain basement economy. And EU workers do not want negative competition on their doorstep that undermines decades of progress on workers' rights. British and European leaders must set their sights high in the negotiations, and keep on walking the high road together.

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