CWS 3.0: October 8, 2014

Print

UK politicians draw battle lines around employment market

The UK employment market has become the latest battleground for politicians campaigning ahead of the UK general elections in May 2015. The three main political parties have held their annual conferences and drawn their respective battle lines — with mixed reactions.

At their party conference last week, the senior partner in the current coalition government, the Conservatives, promised the people of Britain full employment and 3 million apprentices.

Addressing one of the biggest controversies in the labor market, Prime Minister David Cameron stated: “When companies employ staff on zero-hours contracts and then stop them from getting work elsewhere, that’s not a free market — it is a fixed market. In a Britain that everyone is proud to call home, people are employed, they are not used. Exclusive zero-hours contracts that left people unable to build decent lives … we will scrap them.” 

A separate comment form Cameron criticizing staffing agencies that recruit exclusively from overseas has been met with concern from those within the staffing industry.

“It was disappointing to hear the prime minister call into question the valid role employment agencies play in finding skilled people to support businesses, whether from the UK or overseas,” said Kate Shoesmith, head of policy at the UK’s Recruitment and Employment Confederation (REC). “British agencies are already required by law to list all vacancies in Britain and in English, and advertising exclusively overseas is prohibited.”

Meanwhile, the Labour Party, under the leadership of Ed Miliband, has promised to increase the national minimum wage to £8.00 ($12.80) per hour by 2020. The national minimum wage rose to £6.50 ($10.40) on Oct. 1 for those aged 21 and over.

Miliband said that the plan would add about £3,000 ($4,798) per year to the salaries of those on minimum wage working 40 hours per week. Business groups, however, warned Miliband such an increase would negatively affect job creation.

“Raising wages in this way would put serious strain on businesses, particularly hard-pressed smaller firms with tight margins, which would end up employing fewer people,” said Katja Hall, deputy director general of the Confederation of British Industry.

John Longworth, director general of the British Chambers of Commerce added that, while the minimum wage must rise, forcing an increase from Westminster would have a negative impact: “Businesses are in favor of an evidence-based approach to the minimum wage rather than political parties using it to gain support from voters.”

Unions, however, are in support of increasing the minimum wage further. “Raising the minimum wage and putting more money into the hands of low-paid workers won’t just be welcomed by hard-pressed families,” said Frances O’Grady, general secretary of the Trade Union Congress, “it will also be good news for local economies who will benefit from a boost in workers’ spending power.”

Business Secretary Vince Cable, deputy leader of the Liberal Democrats, the junior partners of the current ruling coalition, announced during his conference speech an inquiry into employment rights.

Cable is critical of the current Conservative government’s employment policies, including the introduction of employment tribunal fees, a reduced cap on awards for unfair dismissal, and the extension of the minimum time needed in a job for a worker to be entitled to make an employment tribunal claim.

Cable also attacked the Conservative’s immigration policy and attempts to limit migration into Britain: “They say they want Britain to be open for business, to win the global race,” he said in his speech, “then, they try to close the borders to skills and talents that Britain needs, by pursuing an absurd net migration target – plucked out of the air and totally unenforceable.”

But Kevin Green, chief executive of the REC, warns of changes that could hurt the UK’s flexible labor market. “Cable must be sure to avoid proposing changes that would have any kind of detrimental impact on the UK’s successful, flexible labor market which has kept record numbers of people in employment and avoided the problems faced by many of our European neighbors throughout the downturn,” he said in a press release, adding, “Anything that helps raise standards and creates a level playing field in the market for compliant recruiters has to be welcomed,” Green concluded.

As the parties jostle for votes, promising the public a variety of changes and new policies, they must bear in mind advice from those operating in the employment market.