Malcolm Mackay: employment law likely to see sweeping changes

Increasingly people are working in flexible locations such as coffee shops. Picture: Getty Images/iStockphoto
Increasingly people are working in flexible locations such as coffee shops. Picture: Getty Images/iStockphoto
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Do you remember when the lucky individual in charge of hiring and firing was called the personnel officer? There can be few places where this title is still in use as the whole sphere of human resources has developed.

So, what if the term ‘employment law’ was consigned to the dustbin of history too?

As one of the early practitioners in Scotland of employment law, I’m still rather fond of the term. But sentimental attachment to a term is frowned upon as illogical in most legal quarters. It is plain to see that the whole field of employment law is changing.

Overall job security has had to give way to flexibility

This is because the workplace landscape is changing dramatically too. As a starting point, there are fewer big employers. Instead, in 2016, there were 5.5 million private sector businesses in the UK, of which 5.3m were micro-businesses employing fewer than ten employees.

The SME sector (fewer than 250 employees) now accounts for 99 per cent of businesses in the UK, with 5.4m different SMEs. Since 2000, the proportion of businesses that employ people has fallen from around a third to around a quarter. This is as a result in the growth of self-employment and the one-person-band.

The larger workplace in many sectors is almost unrecognisable from even a decade ago. The forces that govern it have changed. The new breed of global players centred on technology has driven this with vigour and pace. The disrupters, such as Uber and Amazon, have been changing the way people work.

The ability to dominate and change the marketplace occurs because the consumer wants cheaper goods on ever-shorter deadlines. This might create more jobs but the traditional working relationship is structured in a completely different way. This is often a double-edged sword.

Zero hours contracts are often criticised and rightly so when they are being used to abuse workers, yet we need to appreciate that it might actually suit some people. Increases in short-term contracts that do not give the protection of traditional employment contracts can work if they suit both parties. Overall job security has had to give way to flexibility but that is simply a reflection of the age in which we live and the advance of technology.

Where does this leave the position of bargaining power, once the reason for joining a trade union? The unions still have an incredibly important role to play in our society and do a vital job in protecting workers and fighting for their long-term welfare. However, increasingly bargaining power is in the hands of an individual who has to make the best of his or her abilities and bargain with them.

If the market is saturated with too many people bidding for the same kind of work, economics will dictate that wages and salaries will stagnate. If you mix in related issues such as immigration and contractual issues surrounding self-employment, we have a new ball game. As the number of small businesses increases, employment lawyers will need to adjust what they do and how they do it to service clients, many of whom will have limited budgets along with changing needs.

So what is the real future of employment law? Many future working environments, and it is hard to call them workplaces, because often there is not a permanent location, are in coffee shops, on trains from Glasgow to Edinburgh or at Base Camp on Mount Everest.

The next generation of relationships will be shaped by contentious issues and decisions made in tribunals and courts. Frequently, these will be test cases with the outcome affecting large numbers of people. It will be in the economic self-interest of large employers to follow and respect these decisions. In the era of the mega-brand, how companies recruit, develop and shed people is a major brand issue. Multi-nationals know that.

So employment law as it stands now is likely to remain important. Will we still call it employment law? I doubt it. And if the personnel officer is involved, that would be a turnaround.

Malcolm Mackay is chairman of United Employment Lawyers

www.unitedemploymentlawyers.co.uk