Punishing employers doesn’t help workers. Left as it is, Labour’s new employment bill will only further damage the labour market, writes Reed CEO James Reed
Having spent the last 30 years helping people find jobs, I’m all in favour of strengthening workers’ rights. They are the foundation of a good relationship between a business and its employees. But the new Employment Rights Bill, as it stands, has some aspects that are either very complicated or will put businesses off hiring people, which is the last thing the economy needs.
The Bill runs to 197 pages and will affect every employer in the country, whether they employ one person or 1.5m like the NHS.
The first proposal that needs very careful consideration is day one rights for workers to claim unfair dismissal. This is bound to put companies off from taking a risk when they employ someone. My concern is it will make it more difficult for the marginalised – people who have been unemployed, had career breaks or are ex-offenders – to get jobs.
It may be the case that making workers wait two years before they can claim unfair dismissal, as is currently the case, is too long. But ministers should consider a compromise – perhaps a period of nine months, rather than making employers frightened of a tribunal case on day one before they get to know a new member of staff.
Secondly, ministers said in their manifesto they wanted to ban exploitative zero hours contracts, but currently the Employment Rights Bill appears to go even further and rule out any arrangement without a permanent or part time contract for hours. Essentially, ministers are legislating for guaranteed working hours. This could really damage the flexibility of the labour market. The Institute of Directors’ proposed amendment to increase the planned reference period for the entitlement to guaranteed hours to 52 weeks, and make it a right for employees to request, rather than be proactively offered a contract reflecting hours regularly worked, seems sensible.
Finally, ministers propose making employers liable for the actions of third parties. So if a nurse is unfortunately abused by a drunk in A&E, the hospital trust is held responsible. This can’t be right.
The Bill as it stands needs amending as it goes through Parliament to avoid doing further damage to the labour market – already in decline, thanks in no small part to the looming rise in employers’ National Insurance.
It’s important that we are fair to workers. But it’s important that we are fair to employers too.
Expense fiddlers, beware!
Rachel Reeves seems to have got herself into something of a mess over the dates on her CV and historic expenses claims from when she worked in the private sector. Reed Screening checks hundreds of thousands of job applicants’ CVs a year, and these details do matter, especially in future if hiring becomes more risky for employers due to the Employment Rights Bill.
Someone told me a long time ago: “If you want to get rid of someone, check their expenses”. In my experience abuse of expenses is very common, not least among journalists. I would say to anyone thinking of fiddling claims that it’s a very foolish thing to do. You forgo all your employment rights if an employer wants to part company with you. It means you can be sacked on the spot for gross misconduct, with no recourse.
Mr Tambourine Man
I recently saw the Bob Dylan biopic starring Timothee Chalamet, A Complete Unknown, and really enjoyed it. Off the back of that and a recommendation from a friend who’s a music reviewer, I’ve booked to see singer-songwriter Cat Power at the Barbican performing her recreation of Bob Dylan’s historic 1966 Royal Albert Hall concert.
The return of stagflation
The last time I paid stagflation any attention was when I was doing A-level economics in the 1970s. Initially I thought it meant inflation with antlers, but my teacher soon explained it was a combination of stagnation and inflation. Now it’s back as a concept, with inflation made in Threadneedle Street and stagnation made in Downing Street by a series of successive governments. All of our institutions need to rethink what they are doing to tackle it.
A trip to the theatre
The Years, playing at the Harold Pinter theatre and starring Romola Garai, is a very memorable production which I thoroughly recommend. During the now infamous abortion scene, they had to stop the performance when I saw it, as someone in the audience was said to have fainted and had to be removed for their own good. I wasn’t sure whether this was part of the performance or a real crisis, but if the latter, I hope the person in question was okay.
James Reed is the chairman and CEO of Reed