May 29, 2015

Will the election result affect employers?

May’s General Election saw the Conservative Party win a majority in government and the result came as a huge surprise to all involved, not least the Conservatives themselves.

Similarly the level of rise in support for the SNP and the level of decline in support for the Liberal Democrats and Labour was beyond what commentators were expecting.

The result means that the Conservatives have the ability to move forward with their election manifesto pledges, and in so far as these relate to Employment Law matters, this is discussed below. There is already a new Employment Minister in place following Esther McVey’s defeat in the Wirral seat. Priti Patel will oversee the Government’s Employment Agenda for the foreseeable future.

Of huge disappointment for Labour will be their inability to abolish zero hours contracts, one of their main employment policies. Similarly, a key battleground over the last couple of years in Employment Law circles has been the matter of Employment Tribunal Fees.

Had labour been able to forge even a coalition Government, it is likely that these fees would have come under scrutiny. As it stands, they will no doubt continue to form part of the Conservatives’ plans to limit public spending in the Courts and Tribunals System.

For employers, the effect of this is that it is definitely much less likely that they will face an employment Tribunal claim.

The flip side however is that if they do, it is likely to be complex and time consuming, given that the individual has had to pay for the privilege of bringing the claim and it is more likely therefore to have merit.

As for what the future holds, here are some of the Conservative pledges on Employment Matters which may affect businesses in the UK.

What will the Government do?

The minimum wage will be increased to £6.70 this autumn, an increase of 20pence per hour. The plan is to increase the minimum wage incrementally such that at the end of the decade it is no less than £8 per hour. Unless this goes hand in hand with significant business growth, this might not be received well across many sectors. The Government also plans to increase inspection powers and fines for enforcement of the minimum wage.

As regards zero hours contracts, the Government will not look to ban these, as Labour would have. However, they are looking to abolish ‘exclusivity clauses’ in those contracts. This means that if you operate a zero hours contract, it will not per permissible to disallow the employee from working elsewhere.

A number of measures are planned with regard to Industrial action, including a tougher ballot threshold for strike action in some sectors such as health, transport and fire. There are also plans to repeal the current ban on using agency workers to cover striking employees.

For employers with over 250 employees and the public sector, 3 days paid volunteering leave per year will be made a workplace entitlement. It is envisaged that this could create up to 360,000,000 volunteering days per year to be spent on community and charitable projects.

Gender Equality is another area that the Government is focusing on, as they look to seek what they call “full, genuine gender equality”, the focus being on the gap in pay between men and women.

There are plans to require companies with more than 250 employees to publish the difference between the average pay of their male and female employees. Needless to say, if this displayed any inexplicable differences, it could lead to a raft of equal pay claims in the employment tribunals.

Finally, the Government has announced that they intend to create a further three million apprentices over the next 5 years.

All of the matters listed above are likely to impact businesses across the UK. Some favourably, others less so. As always, where new legislation is introduced it is important to fully understand its implementation and effect on legal obligations of the employer and employee.

Moorepay will as usual be keeping track of these developments, so please don’t hesitate to contact us should you require assistance with these (as they are introduced) or other employment law matters.

By Stuart Morley

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About the author

HR Consultancy Team Moorepay