05 December 2022 - Article
The key to future Conservative employment protection policy may well be found in this passage from the Manifesto:
‘Good regulation is essential to successful businesses: we will strive to achieve the right regulatory balance between supporting excellent business practice and protecting workers, consumers and the environment. Through our Red Tape Challenge, we will ensure that regulation is sensible and proportionate, and that we always consider the needs of small businesses when devising new rules, using our new freedom after Brexit to ensure that British rules work for British companies.’
This statement is unlikely to be news to the electorate, as one of the principal drivers of the Conservative Party’s Brexit policy has ostensibly been to free the UK from what is regarded as heavy handed regulation originating in Brussels. However, whether these indicators really do preface swingeing deregulation is more controversial. Many important workplace protections do not derive from European law – unfair dismissal protection and protection for whistleblowers being two examples.
If the UK does not have to heed the strictures of EU law, top of the list of areas for potential reform in the future are the complex rules on collective redundancies, holiday and holiday pay, and the potential for the reintroduction of capped compensation in discrimination cases. Another possible contender for reform is TUPE, though many argue that TUPE rules have become so embedded into business transfer and outsourcing practices that there is little appetite for reform.
What Brexit would ultimately permit a future Government to do will also depend on the kind of agreement that is reached about a future trading relationship and with whom. If a trade agreement is negotiated with the EU, Brussels will not be keen to allow the UK to undercut its EU trading partners by lowering the threshold (and thus the cost) of employment protections and is likely to insist that employment protection standards emanating from the EU are replicated in UK law. If, instead, the UK sets its sights on a trade agreement with the US, the pressures will be the reverse – towards a lowering of protections in areas such as employment rights, food standards and environmental protection, to achieve parity with US rules.
The Manifesto contains a short list of additional promises on issues that, whilst important, are not central to the employment relationship. A future Conservative Government would:
- create a ‘single enforcement body’ and crack down on abuses such as failure to pass on tips or pay sick pay;
- introduce a right for workers in the gig economy to request a more predictable contract and ‘other reasonable protections’;
- encourage flexible working and making it the default option unless there are good reasons not to permit it;
- introduce extended leave for neonatal care;
- look at ways to make it easier for fathers to take paternity leave;
- increase the funding of childcare for extended hours and school holidays to assist working parents;
- a review of support for the self-employed including access to finance and credit, and making the tax system easier to navigate.
In a curious passage, the Manifesto also promises to ‘extend the entitlement to leave for unpaid carers, the majority of whom are women, to a week’. It is not clear what this means, or who it would benefit. The document also claims ‘we have reformed redundancy law so companies cannot discriminate against women immediately after returning from maternity leave’. That is in fact not the case – it seems most likely that the passage should say that further reform in this area is one of the Conservative Party’s intentions.
There are also a number of important promises on employment taxes, which, it has been suggested, not least by the Institute for Fiscal Studies, are incompatible with some of the spending pledges that also appear in the Manifesto. These include:
- no rise in the rates of income tax or National Insurance;
- a rise in the National Insurance threshold to £9,500 in 2020 with subsequent increases to £12,500;
In an election that some say is all about Brexit, it may seem that this part of the Manifesto has been assembled in haste, with little attention to detail. But only time – and the outcome of the election – will tell.
If you have any questions regarding the UK General Election 2019, please contact your usual Withers contact. You may also wish to view our dedicated webpage which will be updated regularly before Thursday 12 December, click here to view it.