These are interesting times for employers in the UK. Many feel – rightly or wrongly – that an increasing share of responsibility is being placed at their door. Rising National Insurance contributions, higher energy costs and sustained interest rates have all taken their toll. Labour shortages continue to rumble on in the wake of Brexit and the pandemic, particularly in sectors like construction and care. At the same time, employers are being asked to adapt to a changing regulatory landscape that reflects a growing recognition that the UK labour market is not working as well as it should. The Employment Rights Act received Royal Assent in December, introducing a suite of new protections for workers. It marks an important milestone in the evolution of the UK labour market and the social contract of work that our generation has inherited. But it is not radical. Nor is it particularly groundbreaking. For someone who has spent over a decade researching employment rights, these reforms look more like a modest correction: lawmakers trying to catch up with a world of work that has become increasingly fragmented and insecure. A world shaped by outsourcing, digitisation and business models that have enjoyed flexibility, often at the expense of worker security. What interests me most is not just what is changing, but how change comes about. Debates about the UK labour market tend to follow a familiar script. Government consults. Employers respond. Workers are heard – often separately. Policy then emerges slowly, either through legislation or through voluntary schemes designed to balance competing interests. What is striking is how little room this leaves for employers and workers to negotiate change directly with one another. JUST THE START Alongside the Employment Rights Act, more reforms are coming. The UK Government plans to mandate pay gap reporting for ethnicity and disability among large employers. The minimum wage – arguably the UK’s flagship labour market intervention – is steadily rising, with a new remit to ensure wages are sufficient to live on. Reasonable enough. Layered on top of this are a growing array of asks on employers to voluntarily up their game. Employers today are invited to engage in improving population health and upskilling. The Mayfield review’s Keep Britain Working report sets out a group of vanguard employers to lead the way on healthier work. Mayoral Combined Authorities have employment charters, asking employers to sign up to commitments on pay, progression and job quality. The Disability Confident scheme encourages employers to self-assess inclusive practice (with limited results). Living Wage accreditation invites firms to go beyond the statutory wage floor – a gap now narrowing as the Low Pay Commission’s remit expands. There are many more examples. WHO GOES FIRST? It is often the same employers stepping forward: large organisations with capacity, strong HR functions, and a commercial incentive to take the high road; and smaller outfits who understand the win-win of being a good employer. What is left behind is the majority. The disinterested, the overstretched, and the small number of egregious employers who are happy to exploit gaps in the system. So, this leads me to ask, do we have the right balance? Are we mandating the right things, and politely asking for the rest? Will this combination of law and voluntary action get us where we need to go? And are these really the only levers we have to improve the labour market? The problem with new laws is not just writing them – it is enforcing them. That means enforcing old laws too, something the UK has a poor track record on, from tribunal backlogs to widespread minimum wage underpayment. 20 |
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