Source: Personnel Today | Published:
What will each of the political parties do to the world of employment if they were elected? There have already been a number of significant policy commitments and leaks of draft manifestos. As the official manifestos are published, we run down those policies most likely to influence the employment landscape.
Wages and holidays
Theresa May has reiterated in her 11 key pledges that the national living wage will rise “in line with average earnings by 2022”, and that the Conservative Party’s commitment to this rate increasing to 60% of median hourly earnings by 2020 (around £8.75) remains.
The Labour Party has promised to beat that rate by increasing the national living wage to “at least” £10 per hour. Its manifesto confirms that this would apply to all workers aged 18 and over, not just those aged 25 and over, as it is for the current national living wage.
Labour’s manifesto says it would propose four new public holidays – bringing England, Wales, Scotland and Northern ireland together to mark all four national patron saints’ days. These will be additional to statutory holiday entitlement so that “workers in Britain get the same proper breaks as in other countries”.
Both Labour and the Liberal Democrats have pledged to end the 1% pay cap on public-sector pay and ensure these workers receive pay rises in line with inflation if they win the election.
Liberal Democrat Vince Cable, the former business secretary, said of his party’s pledge: “Our NHS and schools are already struggling to recruit the staff they need. A better future is available. We will stand up for our schools and hospitals and give hard-working nurses, teachers and police the pay rise they deserve.”
In the official Labour manifesto, the party pledges to introduce an “excessive pay levy” on salaries above £330,000. According to reports, the measure would mean that companies paying staff more than this figure will pay a 2.5% surcharge, while salaries above £500,000 will be charged at 5%.
Labour has said the move, designed to reduce pay inequality by bearing down on “very high pay”, would only apply to firms with “high numbers of staff”.
Under Labour, there would also be a maximum pay ratio in public sector organisations of 20:1. This means if the lowest salary was £18,200 (£10 per hour, 35 hours per week), the highest possible salary would be £364,000. This rule would also apply to private sector companies bidding for public sector contracts.
May has promised a “new deal for workers” in the Tory manifesto, claiming they will deliver the biggest expansion of workers’ rights by any Conservative government
This includes a statutory right to a year’s unpaid leave to care for a relative, measures to protect employees’ pensions and a guarantee that workers’ current rights will remain unchanged through the Brexit process.
She has also reiterated her budget pledge of worker representation on boards for listed companies.
The Labour Party has accused May of “watering down” this policy, however. Employers will only need to have a worker “voice” on boards, rather than specifically appointing a worker representative to the board, and worker representation can be achieved through advisory panels or a non-executive director whose remit it is to monitor employees’ concerns.
Labour’s manifesto boasts a 20-point plan which it believes will end the “rigged economy” in the workplace. This includes a pledge to scrap employment tribunal fees, giving all workers (whether permanent, temporary, full- or part-time) equal rights from day one, and a ban on zero hours contracts and unpaid internships. It has also promised to repeal the Trade Union Act 2016.
On top of the recently introduced gender pay gap obligations, the Liberal Democrats and the Conservatives have said they would bring in mandatory reporting on ethnicity pay gaps for organisations with 250 employees or more.
Immigration and Brexit
Employers are desperate for clarity around how immigration controls will work once the UK leaves the EU, and while the key political parties have given some idea of their direction of travel on this, there has been little in terms of firm numbers.
The Conservatives have indicated they will stick by pledges made in David Cameron’s 2010 manifesto to cut net migration to “tens of thousands” – latest figures from the Office for National Statistics show the current level to be 273,000.
UKIP goes even further. It has said it will cut net migration levels to zero within five years by asking skilled workers and students to get visas and banning migration into the UK for unskilled and low-skilled workers.
The Labour Party has acknowledged that free movement of workers is unlikely to be possible once the UK leaves the EU, but has said that imposing new immigration controls will not be top of its list of priorities if it wins the election.
Tim Farron, leader of the Liberal Democrats, is also against stricter migration controls. He recently tweeted that “Immigration is a blessing and not a curse. We have always been a beacon.” Details of the party’s policies on migration are yet to be revealed.
Childcare, parental leave and employee wellbeing
Both Labour and the Liberal Democrats have made strong pledges on extending paternity leave entitlement, claiming men would get a month’s paid leave to encourage greater sharing of parental responsibilities. Labour has also previously promised to raise the rate of pay for fathers on paternity leave, which is currently £140.98 a week.
The Conservatives have pledged to give workers a statutory right to a year’s unpaid leave to care for a relative, but have indicated that it may extend paid paternity and maternity leave to self-employed and temporary employees. The party has also said it would grant a two-week period of paid leave for parents whose child has died.
On the issue of employee wellbeing, health secretary Jeremy Hunt said last week that a new Conservative government would remove the requirement for employees to have suffered from a mental health condition for at least 12 months before they gained protection under the Equality Act.
This would mean that workers with short-term mental health issues would be immediately protected from workplace discrimination.
The Women’s Equality Party said it would offer free childcare so it could “transform lives, increase the tax base and [have] fewer people on out-of-work benefits”.
The Scottish National Party put childcare among its top pledges when it released a manifesto ahead of the local elections earlier in May. It said it will expand free childcare to cover 1,140 hours per year by 2022, which equates to around 25 hours per working week.
Taxes and pensions
After abandoning proposals to increase national insurance contributions for the self-employed, Chancellor Philip Hammond has not ruled out future rises in the next Parliament.
Shadow chancellor John McDonnell said his party would not raise income tax for those earning less than £80,000 but that those earning more than that figure would pay “a modest bit more”.
Labour would lower the threshold for the 45p additional rate to £80,000 from its current level of £150,000. And it would reintroduce the 50p rate of income tax on earnings above £123,000. Scotland would not be affected as it has independence over income tax rates.
The Liberal Democrats have proposed a 1% rise in income tax which it says would enable it to invest an extra £6 billion a year in the NHS.
In Scotland, first minister Nicola Sturgeon has said she is keeping under review a policy to raise the top rate of income tax for those earning more than £150,000 from 45% to 50%.
Both Labour and the Liberal Democrats have vowed to protect the “triple lock” on state pensions, which will ensure that state pensions rise in line with wages, inflation, or by 2.5% – whichever is highest.
Labour has also said it would amend company takeover rules to protect employees’ pensions.
The Tories appear to have promised something that already exists – a statutory right to time off for training.
In terms of other skills commitments from the Conservatives, it is likely these will follow the reassurances made in the Government’s industrial strategy, which it unveiled in January. However, the Business, Energy and Industrial Strategy Committee deemed the proposals “deeply disappointing” and lacking in detail.
The Liberal Democrats have promised to invest £660 million more into further education if they win the election, and have indicated that there will be further commitments to support adult learners in their forthcoming manifesto.
Labour has said it will keep the apprenticeship levy, which came into force last month, but would ring-fence more than £400 million of the revenue from this for small businesses.
This article is being updated as more details emerge. Last update: 16 May 2017 at 2:53pm.