Are there really no votes in employment rights?

So, the longest general election campaign in history – it surely started at least 12 months ago – has at last reached its final phase, with the three main political parties publishing their manifestos over a frantic three days at the start of this week. This blog’s founder, the fantabulous Sean Jones QC, has put his sanity at risk (so that you don’t have to) by ploughing through their combined 330 pages and documenting every last relevant policy commitment in the Hard Labour Guide to #ukemplaw Election Pledges. But I can’t resist adding a bit of (highly) subjective commentary.

Overall, it’s hard to avoid concluding that all three main parties see no great electoral advantage in trying to improve the working lives of some 30 million people. In 330 pages, there is just one mention of ‘flexible working’, and even that is just a reference (by the Lib Dems) to the Coalition’s extension of the right to request FW in 2014. Labour and the Liberal Democrats each use the word ‘exploitation’ in relation to workers just once, and the Tories four times – but five of those six uses of the word are in relation to migrant workers. Zero-hours contracts get six mentions by Labour, two by the Liberal Democrats, and one by the Tories, but there are no new ideas on how to tackle the exploitative use of such contracts. Despite the Coalition having handed the EHRC £1m to investigate “systemic” maternity discrimination, the issue gets just one brief mention (by Labour). And there is no mention anywhere of unfair dismissal.

Disappointingly, there is no space in the Liberal Democrats’ whopping, 160-page tome for Vince Cable’s October 2014 promise of a new Workers’ Rights Agency to “revamp efforts to enforce employment law and tackle the exploitation of workers” by combining the remits of “the minimum wage enforcement section of HMRC, the working time directive section at the Health & Safety Executive, the BIS Employment Agency Standards Inspectorate, and the GLA.” Perhaps I shouldn’t have pointed out that this was my idea. [Since I wrote this post, Jo Swinson has responded to a tweet from Sean Jones, saying “the idea still there” – ‘there’ presumably being the inside of Vince Cable’s head.]

Regular readers of this blog – hello David, Gem, Michael, Paul and Peter! – will not be surprised to hear that the first object of my skim reading was the issue of employment tribunal fees. The Tories let the cat out of the bag by claiming credit for “reducing the burden of employment law through our successful tribunal reforms” – that’s not what they said about their hefty, upfront fees at the time – and Labour can only find space for a tweaked, two-sentence version of the pledge previously set out in its Manifesto for Work:

The Conservatives have introduced fees of up to £1,200 for employment tribunal claimants, creating a significant barrier to workplace justice. We will abolish the Government’s employment tribunal fee system as part of wider reforms to make sure that affordability is not a barrier to workers having proper access to justice, employers get a quicker resolution, and the costs to the tax payer do not rise.

However, as noted previously on this blog, this raises at least as many questions as it answers. And note that the Manifesto for Work’s “costs to the taxpayer are controlled” has mutated to the arguably more restrictive “do not rise”.

Somewhat surprisingly, the Liberal Democrats are even more parsimonious on the subject of what their BIS employment relations minister, Jo Swinson, recently described as “one of the most high-profile debates around employment law in the last Parliament”. Their manifesto manages just a wishy-washy half sentence:

We will improve the enforcement of employment rights, reviewing employment tribunal fees to ensure they are not a barrier.

Whoopie doo. The Liberal Democrats devote more space to a promise of legal protection for bumblebee nests. Clearly, worker bees are more important than workers to a Liberal Democrat economy.

On the plus side, all three parties pledge to work to close the gender pay gap. The Tories say they “want to see full, genuine gender equality. The gender pay gap is the lowest on record, but we want to reduce it further and will push business to do so: we will require companies with more than 250 employees to publish the difference between the average pay of their male and female employees”. Similarly, a Labour government would “go further in reducing discrimination against women, requiring large companies to publish their gender pay gap and strengthening the law against maternity discrimination” – though there’s no indication of how they would do the latter. The Liberal Democrats only have enough space to say they would “work to end the gender pay gap, including with new rules on gender pay transparency”. The voting public could be forgiven for not realising that  little if any of this is new, mandatory gender pay gap reporting having been one of the last actions of the Coalition.

More positively, all three parties commit to the national minimum wage, and it’s especially heartening to see the Tories confirm they “strongly support the [NMW] and want to see further real-terms increases in the next Parliament”. They go on to expose the pathetic timidity of Labour’s promise of £8 per hour from October 2019, by stating: “We accept the recommendation of the Low Pay Commission that the [NMW rate] should rise to £6.70 this autumn, on course for a [rate] that will be over £8 by the end of the decade”. This is accompanied by a pledge to increase the tax-free Personal Allowance from £10,600 to £12,500, so that “those working 30 hours on the minimum wage pay no Income Tax”.

However,  as the FT’s John McDermott notes, this pledge is “less than it seems”, as a minimum wage rate of £8 per hour by the end of the decade would mean £12,480 per year for a worker on 30 hours per week. So, “give or take £20, [a Personal Allowance of £12,500] won’t make any tangible difference”. In any case, most workers on the minimum wage work fewer than 30 hours per week, so already pay very little if any Income Tax. And then there’s National Insurance.

Much the same can be said of the Tories’ other eye-catching move to outbid Labour’s core childcare offer (an expansion of “free childcare from 15 to 25 hours per week for working parents of three and four-year-olds, paid for with an increase in the bank levy”) with a pledge to “give families where all parents are working an entitlement to 30 hours of free childcare for their three and four year-olds”. This pledge is costed at £350m, which sounds too good to be true – and it is. As Sarah Hayward, leader of Camden council, points out in a splendid demolition job, the Tories have previously ‘costed’ Labour’s less ambitious pledge at £1.5bn (Labour’s own figure is £800m). So, to deliver 50% more extra hours than Labour for just £350m, “the quality of the childcare would need to be so appalling that no right-minded parent would ever subject their child to it”.

Elsewhere, the Liberal Democrats re-iterate their offer of an extra four weeks of paternity leave, but only at the current, lousy rate of pay (£138 per week, or just 60% of the NMW), and Labour repeats its February 2015 pledge of an extra two weeks, paid at a much more respectable £260 per week. And, in Labour’s separate Manifesto for Women, issued two days after the main event, there is an interesting promise to “consult on allowing grandparents who want to be more involved in caring for their grandchildren to share in parents’ unpaid parental leave, enabling them to take time off work without fear of losing their job”. This has been welcomed by the CBI, and represents a significant and well-deserved win for Grandparents Plus, which has mounted a sustained campaign on the issue.

And that’s about it. I just hope that, in 2020, at least some of the political parties will bear in mind the axiom that less is more. Because I just don’t think Sean Jones could survive 330 pages again.

Equal pay audits: the wrong tool in the box?

Once upon a time, a long, long time ago, a newly-elected Prime Minister claimed to have invented a wondrous thing: joined-up government. From now on, the purer-than-pure premier said, ministers and their departments would work together to ensure both that an initiative in one policy area would not have unwanted consequences in another, and that only the best and most effective policy tools were selected and prioritised to tackle any particular policy problem. But the years passed, a number of wars were launched, and Tony Blair gradually lost his enthusiasm for joined-up policy making.

This was unfortunate, as ‘joined-up government’ was undoubtedly one of Blair’s better ideas. For decades if not centuries, far too much government policy has been made in silos, with ministers in one department giving little if any thought to how policy ‘owned’ by other departments (or even just by other ministers in the same department) might be reformed or developed to help them achieve their own policy objectives. And, frankly, much the same can be said of many of the campaigning and lobby groups that seek to influence government policy.

This fundamental flaw in the policy process came to mind in recent weeks, with a set-piece speech on the gender pay gap by Gloria De Piero MP, Labour’s shadow minister for women and equalities, and a survey report on the gender pay gap among senior managers by the Chartered Management Institute and XpertHR, setting off a wave of outraged comment pieces and renewed calls for the introduction of mandatory equal pay audits for large employers (i.e. of the sort promised by Ms De Piero).

In the Guardian, noting that, at the current rate of change, it will take 60 years to close the current gender pay gap of 19.7 per cent, columnist Lauren Laverne posed the question: “we have to wait a hundred years for the 1970 Equal Pay Act to work? Are you on glue?” Meanwhile, over on the paper’s Women in Leadership pages, the first of Harriet Minter’s five proposals “to end the gender pay gap” was: “make reporting on pay data mandatory”. According to Minter, this would “bring an end to the madness” of “women being paid less than men”, and “guarantee a fair and equal wage for all”. And, noting the CMI/XpertHR finding that male company directors take home £21,000 more each year than their female counterparts, the Work Foundation’s Professor Stephen Bevan found it “hard to resist the conclusion that equal pay audits should now become mandatory”.

Hmmm. The problem with that line of argument is that it assumes – or, at least, conveys the message – that (a) the gender pay gap is all about women being paid less than men to do the same job; and (b) this is all due to wicked employers having gender discriminatory rates of pay. Accordingly – or so the argument runs – all you have do to close the gender pay gap is shame all those wicked employers into paying their staff equally by making them conduct and publish equal pay audits.

In reality, it’s a lot more complicated than that. Discriminatory pay by employers is just one of many factors behind the gender pay gap, and is quite possibly one of the least influential, overall (which is no consolation if you are one of the all too many women subject to such discrimination). As Professor Bevan notes, “a range of factors are frequently shown to have strong explanatory power, including occupational segregation (and a lower societal value placed on so-called ‘women’s work’), [and] the impact of part-time working both on pay itself and the life-time accumulation of ‘human capital”, as well as “both direct and indirect discrimination”. In 2012, research commissioned by the Government Equalities Office could find only 13 successful ‘equal pay’ employment tribunal claims against employers other than the NHS and local authorities in the three-year period 2009-11, and only 41 such claims between 2004 and 2011.

Furthermore, most if not all of those calling for mandatory equal pay audits are in fact proposing only that they be mandatory for large employers – that is, those with more than 250 employees. Yet such companies employ less than 10 million (40 per cent) of the national workforce of some 24.3 million. So equal pay audits wouldn’t bring any benefit to 60 per cent of the workforce.

Accordingly, as supportive as I am of gender equality and of tackling sex discrimination in the workplace, it’s never been entirely clear to me how or why mandatory equal pay audits would effectively address such a complex range of factors. Furthermore, even if such pay audits did eliminate gender discriminatory pay rates, a gender pay gap would still remain, due to the influence of other, arguably more powerful factors – not least the significant impact on women’s earnings of taking time out of the labour market to have and care for children.

As FlipChartRick demonstrates this week in a must-read blog post, the gender pay gap is not spread evenly among women of all ages and all pay brackets. Far from it. Citing analysis by David Richter of Octopus HR, FlipChartRick argues that “the full-time pay gap at the median has almost disappeared for those in their twenties, with women earning slightly more than men [on average] in recent years”. And “there has been a significant fall in the gender pay gap for those in their thirties”.

Moreover, while “the pay differential for those in their twenties is fairly narrow, even at the very top level [of pay], the pay gap for those over 40 is significant at all levels of the pay distribution but much higher at the top”. In short, “age and position in the earnings distribution has a significant effect on the gender pay gap. Women over 40 and/or in the upper income bracket earn significantly less”. That is, “the gender pay gap appears just at the point in the age distribution when many women have children” and “children have more of an impact on women’s pay than men’s” because it is women “who take on most of the childcare responsibilities”.

FlipChartRick concludes that introducing mandatory equal pay audits “might yield some interesting information for pay data geeks to pore over, but I doubt that it [would] tell us much that we don’t already know, or even whether it [would] reveal some major employers to be significantly worse than others. It is unlikely that the gender pay gap will disappear until equal proportions of women and men take equal responsibility for childcare”.

Which brings me back to my point about joined-up government policy-making. In recent weeks, as part of her “mission to promote shared parental leave”, a policy reform intended to make the proportions of women and men taking responsibility for childcare more equal, the BIS minister Jo Swinson has given a number of major media interviews – including in the Independent, the Evening Standard, and with Family Networks Scotland.

However, while Ms Swinson used these interviews to make much of “recognising that dads want to have a bigger role in their child’s life from the first days” and boosting parental choice, she signally failed even to mention the gender pay gap and the central role that shared parental leave (and more shared parenting) might play in closing it. And the Minister’s omission is even more surprising when one considers that, in the middle of her media push on shared parental leave, she also launched the Liberal Democrats’ campaign to “deliver equal pay in the workplace”. Which consists entirely of – you guessed it! – “plans to require large companies [i.e. those with over 250 employees] to publish the difference in pay between male and female workers”.

Of course, the nine months before a General Election is not the best time to find joined-up thinking within a government made up of two competing political parties, or even just within each political party. But perhaps after May 2015 both elected politicians and the relevant campaign and lobby groups will pay greater attention to the (rather obvious) link between the gender pay gap and the need for more shared parenting. And then we might just see progress on policies – such as increasing the shockingly low rate of statutory maternity and parental leave pay – that would help close the former while facilitating the latter.