Yesterday, Labour leader Ed Miliband responded to recent media and internal criticism of his leadership by giving his #ukemplaw speech. This didn’t go quite so far as resolving the question of whether voluntary overtime should be included in holiday pay, but it did include a robust denunciation of inequality and the casualisation of so much of the UK’s labour force. There were repeated mentions of zero-hours contracts, low pay, and insecure work, and more than one shout-out for the Living Wage.
All fine and dandy, even if there wasn’t any new policy as such, and had the event concluded at the end of Miliband’s speech I would most likely have left Senate House feeling somewhat encouraged. But the speech was followed by a Q&A, and my positive mindset was inadvertently shattered when a Labour activist in the audience – picking up on her leader’s condemnation of zero-hours contracts and citing her own bitter experience – gamely urged Miliband to legislate for an outright ban.
Starting his response with a swipe at the Coalition’s plan to simply ban exclusivity clauses, which he (rightly) noted will do nothing to tackle the exploitative use of zero-hours contracts, Miliband went on to re-iterate Labour’s own plan to pass legislation giving zero-hours workers who are in fact working “regular hours” a legal right to demand a regular contract. “It is essential we do this”, said Miliband, “as the problem is affecting so many people.”
And then Miliband was off to the next question, without explaining how or why the “bad businesses” that cause so much misery to “so many people” will change their exploitative practices just because politicians in Westminster have passed yet more new employment law. Will tens of thousands of vulnerable, zero-hours workers suddenly discover the courage (and resources) to risk almost certain dismissal (or just a reduction in their hours to, well, zero) by issuing a tribunal claim against their exploitative employer for refusing to give them a regular contract?
No, they won’t. Which is why, if Miliband and his party are serious about tackling the ever greater casualisation of the labour market, and the associated zero-hours contracts, chronic low pay and insecure work, they have to start thinking about doing more than simply pass more laws creating more rights. For, as the October 2014 report of Labour’s own National Policy Forum acknowledges, “Employment rights have to be enforceable to mean anything.”
And what plans does Labour have to make employment rights – existing and new – more enforceable?
Well, somewhat belatedly, the party has started making the right sort of noises on tribunal fees, which have slashed the number of cases by 65% and left the average private sector employer facing a claim just once every 83 years. However, it’s pledge to replace the fees regime with one in which “affordability will not be a barrier to workplace justice” remains more a clumsy slogan than a credible policy solution to the not insignificant problem that outright abolition now comes with a price tag of some £40m in lost fee income (£4m) and increased operational costs (£35m).
However, as already noted, understandable fear of victimisation or summary dismissal means that, high fees, low fees or no fees, many abused workers will not even contemplate taking their employer on with a tribunal claim. And that means rogue employers can profit from exploitation with near impunity. It was for this reason that, in 1999, the then Labour government established the mechanism by which the national minimum wage is enforced, both in response to complaints and pro-actively, by a team of HMR inspectors. And similar reasoning lay behind the creation of the Gangmasters Licensing Authority (GLA) in 2005.
The National Policy Forum report includes a pledge to extend the narrow remit of the GLA to other sectors such as “construction, hospitality and social care” – but the CBI, REC and other employer bodies will never swallow such an extension of licensing (and see below). And the report states that “alongside increased fines and a new role for local authorities in enforcement [of the minimum wage], HMRC’s remit on enforcement should be expanded to include related non-payment of holiday pay” – these being recommendations from the May 2014 report for the Party on low pay and the future of the minimum wage by businessman Alan Buckle. But the fines have already been substantially increased, and it is hard to see many cash-strapped (and in many cases near bankrupt) local authorities taking an active role in such (limited scope) enforcement.
So, if Miliband’s #ukemplaw speech is to mean anything, he and shadow ministers need to take a leaf out of Vince Cable’s book. Last month, at his party’s conference in Glasgow, Cable quietly announced that the Liberal Democrat manifesto for May 2015 will promise a new Workers’ Rights Agency that would “revamp efforts to enforce employment law and tackle the exploitation of workers” by combining the remits and work 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.” According to Cable, this “joined-up enforcement approach” would “ensure the minority of unscrupulous employers who break the law do not get away with undercutting other employers who play by the rules.”
And, if it makes Miliband and colleagues feel better about lifting ideas from Cable, this wasn’t actually Cable’s idea – he simply lifted it from me. Over more than a decade at Citizens Advice, I repeatedly advocated a consolidation of the State enforcement bodies into a Fair Employment Agency, so as to shine a light into the murkiest corners of the labour market, provide better value to taxpayers, and secure a fairer competitive environment for business. And I’ve continued to do so in recent years. I really am that boring.
However, not long after I got home from Senate House, a tweet by shadow work & pensions secretary Rachel Reeves alerted me to another, equally depressing hole in Miliband’s purported determination to tackle the scourge of insecure and badly paid work. Reeves was tweeting a link to an interview she and shadow business secretary Chuka Umunna have given to the Financial Times, from which it is clear that, faced with protests from the CBI and others, Reeves and Umunna are now rowing back on Miliband’s eve of conference pledge to raise the minimum wage rate to at least £8.00 per hour from October 2019. And, later in the evening, on BBC Newsnight, Umunna confirmed that Labour would only “try to get the minimum wage to £8.00 per hour by 2020”.
So, while Miliband’s #ukemplaw speech has been rightly praised for its greatly improved oratory and highly commendable “focus on inequality and insecurity,” the content seems as sadly hole-ridden as ever.