Yesterday, Britain celebrated the success of the ‘deeds not words’ campaign that won women the vote. Today, we have something of the opposite in the government’s response to last summer’s Taylor Review of Modern Working Practices. It’s not nothing, but those hoping for a bold new dawn in the rules that govern Britain’s labour market will be disappointed.
First, the good news. The government has got something concrete to say about boosting enforcement of our labour market rules and increasing the fines for employers who break them most egregiously. Too often in the past we have left individuals to enforce their own rights, so a clear role for HMRC in policing sick and holiday pay is particularly welcome. However, there are valid questions about whether HMRC will have the resources to be proactive on such cases, rather than simply deal with them when they turn up alongside existing minimum wage enforcement work. Ensuring all workers get a clear statement of their employment rights on their first day in a job will also help raise standards.
But on the rules of our labour market, rather than the enforcement of them, the government has a lot less concrete to say. They have instead announced a wide range of, fairly open, consultations.
For some of these, such as the complex issue of employment status, that is sensible enough. However, without a clearer sense of a direction from government the danger is that it will simply conclude it’s all very difficult. We know that already.
The risk more generally is that the government’s response gives us topics of conversation when what Britain really needs is an agenda for action.
Looking at the rules that some firms use to get round equal pay for agency workers (the so called Swedish derogation) is better than nothing – but ending those rules is the right thing to do. On zero and short hour contracts, workers should have a right to a contract that reflects the hours they actually work – not just a right to request that can easily be rejected.
The most radical proposal in Matthew Taylor’s Review was a requirement for firms to pay a higher minimum wage for non-contracted hours. The government has asked the Low Pay Commission to look at it. But their lack of commitment to any action raises big doubts over whether it (or related reforms that we have proposed) will ever see the light of day.
So more acting and less talking is clearly what we need. After all, the experience of workers across Britain over the last few years – lots of jobs available but big questions about the quality, security and pay that many offer – have shown us all that we need to do more to make our labour market deliver for those working hard in it.
Where we are in the economic cycle, with employment at record highs, means now is exactly the right time to strengthen our employment law and tackle insecurity. Unfortunately, the political cycle points painfully in the other direction. Most obviously that’s because the government doesn’t want to risk much primary legislation given the state of the parliamentary arithmetic. It’s no surprise that sensible, complimentary, reforms to narrow the tax gap between employees and the self-employed were ruled out today.
Furthermore, neither main party has any interest in cross-party deal making of the kind that could see employment law changes making it onto the statute book in this parliament. Labour will want to say this is an empty response to an empty report, while the government does not want to give the right of their party another thing to kick-off about. Brexit is doing quite enough of that already. The experience of big promises and no action on workers on boards is illustrative in this regard.
But before we get too pessimistic its worth ending on some optimism. First, let’s reflect on how far we’ve come. The Conservative Party commissioned another review of employment law five years ago. Back then, The Beecroft Report focused on how to water employment protections down. Now, we’re debating how far to move in the opposite direction. There is a much greater focus today on the quality of work – something that the Taylor Review rightly put up in lights and which the government is promising to make central to their industrial strategy. That is both sensible, given the crucial link between how labour is used and our productivity performance, and unavoidable, as big shifts in our labour market see the cost of low paid labour rise and its availability fall.
It’s also welcome that serious people, including those at the Low Pay Commission, will be looking further at the policy options Matthew Taylor has proposed. And in a new world of backbench power in the Commons maybe some of our more entrepreneurial MPs will make more concrete progress on some of the specific issues above – many of which are ripe for Private Members Bills.
So, no, the government has not today announced a broad agenda to improve the quality of work in Britain. But with politics what it is we should not be too surprised. The conversation is at least on the right track, and there remains a chance of progress that would make a real difference to people’s lives. For those of us that want to see that happen the task now is to keep up the pressure, recognise progress where it is made and point out forcefully where talking is filling the space where action should lie. Or as someone with significantly more poetic license once put it “the work goes on, the cause endures, the hope still lives, and the dream shall never die.”
Torsten Bell is chief executive of the Resolution Foundation