Hitherto, discussion of the impact of austerity has focused largely on public services being cut, benefits being slashed, jobs being lost, insecurity becoming rampant, and wages falling—they are now, in real terms, 9% below the 2007 level. However, another process has been going on during this time which is equally relentless and callous but which has not been accorded the attention it deserves. Remedying that is part of the purpose of today’s debate. I refer, of course to the continuing vicious attack on employment rights. Because this attack has been pursued piecemeal and gradually across a wide spectrum of employment law, its cumulative impact has been concealed, but collectively it amounts to something very substantial.
Workers with less than two years’ service in their current job have already lost the right to go to a tribunal over unfair dismissal. In this last week fees of up to £1,200 have been introduced for anyone who wants to make an application to an employment tribunal. Then there are the heartless cuts—drastic cuts of £1,500 to £2,000—in compensation for the innocent victims of crime in occupations that deal directly with the public.
Now the Government have plans for a further range of attacks on employment rights. Proposals for reducing consultation rights over redundancies are well advanced. The Government want to introduce so-called settlement agreements to make it easier for employers to pressure or bully workers they want to get rid of into resigning. Compensation for unfair dismissal is to be limited. Even though there has been widespread opposition, and only lukewarm support even from business, the Government have still pushed ahead with introducing a new employment status of ‘employee shareholder’ so that employers can buy out the rights to unfair dismissal, statutory redundancy pay, time to train, and the right to request to work flexibly. The Government want to reduce the protection that TUPE offers to workers who have their job transferred to another business. In addition, leading Tories, including the Mayor of London, are making noises about attacking trade union facility time, increasing thresholds for strike ballots—to levels, I might say, that no politician would dream of allowing with regard to their own election—and making statutory trade union recognition even more difficult.
This sledgehammer—I do not think that is an exaggerated word, because cumulatively it amounts to that—attack delivered piece by piece to weaken the whole range of employment rights is clearly designed to overturn the social settlement after 1945 and return Britain to workplace conditions similar to those operating in the 1920s and ’30s when employers flaunted overwhelming market power. The attack on the Agricultural Wages Board has already removed the last vestige of the wages safety net, which was originally erected by Winston Churchill, and the removal of strict liability from health and safety law means that in future injury victims will have to prove negligence even when their employers have brazenly broken the law.
The one area of employment law that the Tories have not been able to touch has been those rights provided for by the European Union: paid holidays, health and safety, equal treatment for part-time workers and women, protection when a business is sold off, and a voice at work. They are all valuable rights. By repatriating those rights—I think this is a big part of the motive of current Tory Euroscepticism—the Government will make it easier for bad employers to undercut good ones – which was, of course, the reason why Winston Churchill favoured wages boards in the first place – drive down wages, and make people who already work some of the longest hours in Europe work even longer hour. Quite apart from the harshness and injustice of such a policy, a low wage, low skill, low morale, low productivity economy is the last way to bring about a successful, dynamic economy.
This litany of measures—I will not call them reforms, because they are anti-reforms—have several other dimensions. One of the most glaring is the class basis of all this: grinding down the pay and terms and conditions of the most vulnerable and poorest people at the bottom, while at the same time endlessly amplifying the excessive remuneration and bonuses at the top—greed at the pinnacle, repression at the base. Bankers who wrecked the economy are seeing their bonuses increase this year to, I think, more than £6 billion, while ordinary workers are experiencing the longest fall in real wages in this country since the 1870s, with four out of every five new jobs created since 2008 being low paid and often insecure and short-term. Such is the state of inequality today that the directors of the biggest companies are now paid—or, rather, pay themselves—more than £60,000 a week, while the national minimum wage is just £200 a week. And the Resolution Foundation estimates that 4.8 million workers—one in six of the total work force—are not even paid that: they are paid, illicitly, below the national minimum wage.
On top of that, we now have a blizzard of zero-hours contracts. A very large number of people—at least 1 million, and some put the figure as high as 5 million—have no fixed income or fixed hours by which to plan their lives. The epidemic of agency work, which was used to increase the casualisation of labour and to undermine security, may have largely been quelled as the result of a lot of pressure, particularly from the unions, but we now have a situation in which rogue employers have alighted on bogus self-employment and the mandatory Work Programme, alongside increasing normalisation of zero-hours contracts, as the latest artifice to pay workers less and to weaken their terms and conditions.
Let me describe the situation for Members, because we in this House do not experience it. The abuses of zero-hours or agency work are devastating. It means running out of money during the month, borrowing from payday lenders is routine, it means looking for additional employment (if allowed by their first employer). high levels of anxiety, no savings or contingency money, no access to credit, penalties for workers who try to rent accommodation, sanctions if a worker speaks out, and contracts that imprison workers on zero hours with the same employer often for more than three years.
Zero-hours contracts are not a small matter. They have spread right across the economy into police services, social care, manufacturing, hospitality, the charitable sector and elsewhere. When profits have never been so high and when the ultra-rich and corporate elite have never had it so good, this is a despicable demeaning of the working conditions of a large section of the work force, which some people understandably describe as a modern form of wage slavery.
Another alarming and dangerous aspect of weakened employment conditions that is becoming more widespread is the impact on health and safety. In the building industry, false self-employment through the device of payroll companies not only costs taxpayers £1.9 billion a year in lost revenue, of which £1.2 billion comes from employers avoiding national insurance contributions, but has serious implications for site safety. Sites that use false self-employment often have a higher accident rate because they usually do not have independent safety representatives. They also have a higher turnover of staff, meaning that safety measures are often lost, are not heard or are fragmented. The fact that falsely self-employed workers can be fired without warning means that they are far less likely to raise safety concerns. That explains why, over the past eight years, more than 55 construction workers a year on average have been killed just doing their ordinary work.
Similar conditions apply on the railways. Network Rail uses more than 500 contractors and labour-only suppliers. Less than 10% of its workers are engaged on permanent contracts. The Office of Rail Regulation has stated, rather delicately, that it is “mindful of the considerable risks that can arise from safety critical staff working for more than one employer”. That is a hopeless understatement. The practice is clearly dangerous. We should not tolerate such fragmentation of employment being used to cut corners when it puts human lives at risk.
In conclusion, Britain will not be a civilised place to work until all workers are paid at least the living wage; free access to justice for aggrieved workers is fully restored; bogus self-employment is ended; health and safety regulations are independently enforced in all dangerous occupations; zero-hours contracts and agency work are strictly regulated, if not eliminated, to ensure that important and necessary working rights are not sacrificed; all workers who have been blacklisted—a practice which recently came to light—are fully compensated and a public inquiry held to ensure that it never happens again; wages councils are reintroduced because, as Winston Churchill understood, they are the only effective way to protect the very poorest; and, finally—because I do not just want to eliminate the negatives—a positive platform is established for employment rights through a partnership between management and the unions in the running of companies. That concept, which this House should encourage, has long been the mark of some of the most successful companies abroad, such as Germany. This Government has had an appalling record on employment rights. Until that is fully reversed, we will not earn our right to be called a civilised nation.