Counsel Reed Smith LLP
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What employment law policies are you really voting for?

28th Apr 2015
Counsel Reed Smith LLP
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Elections ahead
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With the main parties having  published their manifestos for the general election 2015 (don't forget to vote on May 7th!), what is the future looking like for employment law?

Conservatives

They have indicated their support for real terms increases in the National Minimum Wage, rising from its current level of £6.50 per hour to reach £8 per hour by the end of the decade. The Conservatives have also promised to prohibit the use of exclusivity clauses in zero-hours contracts. Employers with more than 250 employees will be required to publish the difference between the average pay of male and female employees.

There will also be restrictions on the ability to strike. Lawful strike action will only be able to take place where at least half of eligible workers have voted. In essential public services, industrial action will require the support of at least 40% of those entitled to vote, as well as a majority of those who actually turn out to vote. Restrictions on the ability of employers to hire agency workers to provide cover during strikes will also be lifted.

Of potential far greater significance is the promise to hold a referendum on the UK’s membership of the EU by the end of 2017. Any re-negotiation of the UK’s terms of membership, and any withdrawal from the EU, has the potential for a huge upheaval in employment law.

Labour

Labour also promises to increase the National Minimum Wage to £8 per hour, by October 2019. Labour will additionally use government procurement to encourage the higher Living Wage (currently £7.85 per hour, £9.15 per hour in London). Publicly listed companies will be required to report whether they pay the Living Wage.

Zero-hours contracts will also be restricted. Those workers who work regular hours for more than 12 weeks will be entitled to a “regular” contract. Employers will also be prevented from undercutting the pay of permanent staff by using cheaper agency workers.

Labour has also promised to abolish the current Employment Tribunal fees system. It is not clear whether fees will be abolished completely or whether a new system will be put in place with (we assume) lower fees.

While it is almost certain that either the Conservatives or Labour will be the largest party after the general election, the likelihood that neither will secure an overall majority and may need to form a coalition or looser alliance with smaller parties, makes the policies of those smaller parties significant.

Liberal Democrats

The Liberal Democrats aim to expand flexible working. They aspire to paternity leave and shared parental leave becoming rights from day one of employment. More particularly, the Liberal Democrats will expand shared parental leave and introduce a “use it or lose it” month to encourage fathers to take time off to care for their young children.

The Liberal Democrats will also require employers with more than 250 workers to publish details of pay differentials between men and women. By 2020, those employers will also be required to publish details of those who are paid less than the Living Wage and the difference between top and median pay.

Interestingly, the Liberal Democrats also propose measures to prevent employers from avoiding employment rights by wrongly classifying employees as workers or self-employed. In relation to zero-hours contracts, the Liberal Democrats would introduce a right to request a regular-hours contract, and consult on making regular working patterns contractual after a certain period of time.

UKIP

UKIP proposes that the UK should leave the EU. Given that so many UK employment rights (such as those relating to unlawful discrimination, the regulation of working time, and paid holidays and rights provided under TUPE) derive from EU law, there promises to be a significant upheaval to employment law.

If Britain left the EU, UKIP have said that they will seek to incorporate EU derived rights into UK law, but with amendments. The Working Time Directive has been cited as an EU law which would require amendment before being incorporated into UK law. UKIP also promises to give employers the right to choose to employ British citizens first. UKIP additionally proposes to regulate, but not ban, zero-hours contracts.

Green Party

The Green Party aim to increase the National Minimum Wage to £10 per hour by 2020, with the highest earner in an organisation earning no more than 10 times the pay of the lowest earner. A 35-hour working week would be phased in, together with an end to ‘exploitative’ zero-hours contracts. The Greens would also reduce Employment Tribunal fees.

Scottish National Party

The Scottish National Party has launched its “Jobs Manifesto”. Proposals include increasing the minimum wage to £8.70 per hour by 2020 and ending ‘exploitative’ zero-hours contracts.

Plaid Cymru

Plaid Cymru proposes to end ‘exploitative’ zero-hours contracts, as well as to increase the National Minimum Wage to the level of the Living Wage.

Plaid Cymru would also require supervisory boards of employers with more than 500 staff to include employee representatives. A ‘fair pay’ scheme will be introduced to link the pay of everyone within a company. The stated aim is to prevent spiralling executive pay while other staff receive no pay increase.

A review of the Employment Tribunal Fees system is also promised, together with legislation against ‘blacklisting’.

With the opinion polls so close, it is very unclear at the moment as to what changes will be made to employment law after the election. What is clear, though, is that further changes are coming, with the National Minimum Wage and zero-hours contracts being targets for whoever is elected

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