EVERYONE expects the Tories to be pro-business, but it looks like it won’t turn out to be quite that simple, says Gillian MacLellan
The employment law landscape seemed so much simpler in the past. In 1992 when John Major secured an unexpected Conservative majority in the UK election, you expected employment legislation to remain weighted towards business. Likewise, when Tony Blair led Labour to a landslide victory in 1997, we were right in predicting a shift in rules to favour employees.
While the party is in favour of maintaining zero-hours contracts, it has introduced reform
Certainly, if you reflect on the changes that have taken place over the past five years, there has been a move back to a more pro-business agenda. However, until the full impact of the abolition of employment tribunal fees became clear, the overall impression is of a less radical shake-up than we might have expected, no doubt owing to the need to balance a delicate relationship between the Conservatives and their Liberal Democrats partners.
David Cameron’s outright victory in last month’s general election should therefore signal a clear direction of travel on employment legislation, but it’s not that simple, particularly given the current political landscape. The SNP’s unprecedented showing in the general election and the potential transfer of greater autonomy to the Scottish Parliament may create some scope for divergence north of the Border. We will have to wait and see what impact the election of 56 SNP MPs to Westminster will mean for Conservative plans.
While the Scotland Bill will include plans to devolve power to Scotland regarding the administration of the employment tribunal system, potentially paving the way for the abolition of fees north of the Border, the rest of employment law remains at Westminster.
We do know the Conservatives are committed to continuing to implement policies which they believe will help further the recovery by enhancing UK companies’ competitiveness and flexibility.
The party made pre-election pledges to cut “a further £10 billion of red tape” and to introduce a “one-in-two-out” rule when it comes to regulations.
We are also aware that tougher rules on union strike ballots will be introduced across the UK, including the requirement for a minimum 50 per cent turnout before a vote in favour of industrial action will be lawful, with a successful ballot carried by a simple majority of those who turn up to vote.
Carrying on with this theme, workers within essential public services, such as the fire, transport, health and education sectors, will also require to reach a threshold of 40 per cent of the workforce voting in favour of industrial action before a ballot is considered lawful.
On the other hand, the Conservatives support the Low Pay Commission’s proposal to raise the minimum wage to £6.70 this October, with a stated desire to increase it towards £8 per hour by the end of this parliament. At the same time, they are encouraging business to pay the Living Wage, although they do not plan to introduce any enforcement mechanism.
The Conservatives have also committed to increase free childcare for working parents to 30 hours per week for three to four year olds and have suggested that public sector employers and companies with 250 or more employees allow individuals three paid days off annually to undertake voluntary work; all part of Mr Cameron’s “big society” agenda. And while the party is in favour of maintaining zero-hours contracts, it has introduced reform, effective from 26 May, which bans ones with exclusivity clauses.
All in all, not quite the clear pro-business programme we might have expected.
Another key issue which has to be factored into any assessment of the future of employment law is the Europe issue.
Many of the UK’s employment laws come from European directives. David Cameron’s proposed in-out referendum on EU membership could have the biggest impact on employment law should the UK vote for withdrawal.
That, however, is another matter altogether, especially in Scotland where the SNP have demanded that voters north of the Border would have to emulate such a decision for it to be binding here.
So, while the Conservatives have made clear their intention to further shift the balance in favour of business, their policies are more of a mixed bag than we might have expected and this, together with negotiations over further devolution to Scotland, creates an uncertain picture of how employment law will evolve north of the Border over the next five years.
• Gillian MacLellan is an employment partner at CMS. www.cms-cmck.com