Unions and employers have met with the government to discuss new plans for workers rights but it comes as ministers are warned against “unintended consequences” of reforms.
Deputy Prime Minister Angela Rayner and business secretary Jonathan Reynolds met unions and businesses on Wednesday to kick-start Labour’s work on employment rights.
Rayner hailed the meeting as a “new era of partnership”, which follows the government’s manifesto commitment to work with firms and unions in a bid to boost economic growth via workers rights.
Attendees included the Trade Union Congress (TUC) and unions such as Unite, Unison and the GMB, along with business groups such as the Confederation of British Industry (CBI), the British Chambers of Commerce (BCC) and the Federation of Small Businesses (FSB).
But while union bosses including the TUC general secretary Paul Nowark welcomed it as an “important chance to discuss the shared gains that the government’s reforms will bring”, others warned of the risk of rushing to legislate and the potential impact on smaller outfits.
“Together, we can raise the floor so that every job has the pay and security that families need to thrive, workers have access to unions, and good employers are not undercut by the bad,” Nowak added.
However, FSB policy chairwoman Tina McKenzie stressed it was “crucial” for ministers to “try and reduce harm to employment, small businesses and the economy from any and every negative impact of these proposals”.
And CBI policy chief John Foster and Jonathan Geldart, director general of the Institute of Directors (IoD), said consultation on workers rights was vital to avoid the risk of “unintended consequences”.
While FSB chairman Martin McTague told the Times the alterations would affect smaller firms, responsible for hiring some 60 per cent of the UK’s workforce.
“The biggest harms will come from ramping up risk and cost when weighing up who and whether to recruit,” he said.
“Formal dismissal process from day one would add to your risk and could cause real damage to the economy.”
In its manifesto, Labour committed to consulting “fully” with businesses, workers and civil society on how to implement its workers rights plan – and faced criticism from unions for a perceived ‘watering down’ of its promises in response to feedback from businesses and lobby groups.
The Department for Business and Trade (DBT) said the summit saw attendees vow to “wipe the slate clean and begin a new relationship of respect and collaboration”.
Labour’s proposed Employment Rights Bill, which is slated to be introduced within the first 100 days of the new administration, and a wider plan to “make work pay”, was top of the list.
It is expected to include bans on “exploitative” zero hours contracts and the practice of “fire and rehire”, and introduce rights to parental leave and sick pay from day one of employment.
Rayner added: “Our plan to make work pay will bring together workers and businesses, both big and small and across different industries, for the good of the economy.
“This first-of-its-kind meeting has kicked off a new era of partnership that will bring benefits to everyone across the country striving to build a better life.”
And Reynolds said: “For too long the valuable insights of business and trade unions have been ignored by government, even on past decisions which have directly impacted them.”