TUC: How Labour can govern for working people

The trade union movement will work with Keir Starmer to deliver change

What an extraordinary moment in British politics (writes TUC General Secretary PAUL NOWAK). Labour back in power with a near-record majority. The Conservatives brutally ejected from office. A dozen cabinet members gone. A red wave in Scotland at the SNP’s expense. But while it’s easy to get carried away by the seismic nature of this election – we cannot afford to be distracted. We have a country to fix.

When I congratulated Keir Starmer this morning my message to him was clear. The trade union movement stands ready to work with the new government to repair and rebuild Britain – and to deliver the change working people desperately need. After 14 years of wretched Tory rule and chaos, I am not blind to the size of the task this incoming government faces.

The Conservatives have left behind a trail of destruction for all to see. Stagnant growth and wages. Rising in-work poverty. Broken public services. The charge sheet goes on and on. But despite all of the damage wrought, I am optimistic. After nearly a decade and a half in opposition, Labour can finally begin transforming the country – an urgent and necessary challenge that must be grasped with both hands. So where should we start?

First and foremost, we need to get our economy growing again. Unions and business have been crying out for years for a proper industrial strategy. The Green Prosperity Plan starts us on the road to economic recovery. And it will be a breath of fresh air to work with ministers who are actually serious about protecting and creating good jobs, and boosting skills and productivity.

But securing growth alone is not enough – we also need better living standards. Labour needs to act urgently to make work pay. We currently have over four million people who are trapped in jobs that offer little or no financial security. This is a national disgrace.

The UK’s long experiment with a low-wage, low-rights economy has been terrible for productivity and workers alike. Labour’s New Deal for Working People – delivered in full – will help end the Tories’ race to the bottom on employment standards.

A race to the bottom that has allowed good employers to be undercut by the bad, and scandals like the illegal sacking of 800 seafarers at P&O Ferries go unpunished. Labour’s plans will be a genuine gamechanger. Employment rights from day one. A ban on zero-hours contracts. An end to fire and rehire. New rights for unions to access the workplace. And the scrapping of anti-union legislation.

These are all part of a comprehensive new package of rights that will be good for workers, good for businesses and good for the UK economy. Inevitably there will be some siren voices in the business community who will seek to delay and water down this legislation. But it is vital Labour stays the course and ignores the doomsayers.

All the tired arguments that have been made against improved rights and protections at work echo those used against the minimum wage – now widely acknowledged to be one of the great policy successes of the last 25 years.

The naysayers were wrong then and they are wrong now. It is also vital that immediate work begins on repairing our crumbling public realm. At the heart of the pressures on our schools, hospitals, prisons and social care system is a huge workforce crisis. Across the NHS and social care alone there are nearly 300,000 staffing vacancies and in education the number of teaching vacancies has more than doubled in the past three years.

With morale at rock bottom – after more than a decade of Tory vandalism and neglect – Labour has the chance to signal a new direction of travel. We’ve already seen really encouraging commitments on scrapping tax breaks for private schools to fund new teachers in the state sector, and on closing non-dom loopholes to help bring down waiting lists. It’s no secret though that I want the party to go further and that we explore all funding options for rebuilding our public services.

The TUC has previously called for a national conversation on taxing wealth and I remain convinced that policies like equalising Capital Gains Tax with the taxes paid on earnings could bring in much-needed revenues. People voted in this election because they wanted real change – and Reform’s populist insurgence is a timely warning of what happens when governments fail to act.

And this question of delivery is the crux of the matter. After 14 years of national decline the country has finally got the Labour government it desperately needs. I know how ambitious Keir Starmer and his team are to improve working people’s lives, and the trade union movement wants to work with them.

Of course there will be moments of tension. That comes with being a critical friend. Our job is to speak up for working people and our members and to make sure their voices are heard at the heart of government – even when the message is difficult.

But the prospect of national renewal is real. Decent jobs, strong public services, a brighter, fairer future for all our children. The work will be hard and it starts today – but together we can realise a better future.  

Better worker protections are coming

‘Opponents must stop swimming against the tide’

The UK’s long experiment with a low-rights, low-wage economy is drawing to an end, and employers need to recognise now is not the time for foot-dragging (writes TUC’s TIM SHARP). 

Rupert Soames, president of business lobby group the Confederation of British Industry (CBI), was this week driven to acknowledge that improved workers’ rights is “really good for people who are employed”. 

This matters because bolstering workers’ rights is central to the Labour Party’s New Deal for working people.  

This pledges sweeping but necessary changes including stamping out the exploitative use of zero hours contracts, ending the ability of employers to fire and rehire workers on lower wages, and scrapping the current wait for up to two years for basic workplace protections. 

Such reform is desperately needed. 

Rise in insecure work 

TUC analysis of official figures shows that by the end of 2022 there were around 3.9 million people in insecure employment, a rise of 23 per cent since the coalition took office – almost double the rise of 12 per cent in overall employment growth.  

As Soames, having recently spent eight years as chief executive of outsourcing giant Serco, will be well aware: insecure work disproportionately affects groups of workers who are already discriminated against in the workplace, such as Black and minority ethnic (BME) workers. 

Over half of those living in poverty are in working households – and this rises to three quarters of children living in poverty.

Even the current government promised 20 times to introduce an employment bill. But the pledge remains unfilled. 

Faltering economy 

Meanwhile, the flawed idea that weak workers’ rights means a stronger economy and higher productivity has been tested to destruction.  

As the Resolution Foundation has pointed out: “Labour productivity grew by just 0.4 per cent a year in the UK in the 12 years following the financial crisis, half the rate of the 25 richest OECD countries (0.9 per cent).” 

Moreover, things are getting worse not better. Economic growth is flatlining with the country teetering on the brink of recession. 

The relentless undermining of wages and incomes has repercussions on spending in the economy, with household consumption failing. 

This is why Richard Walker, boss of grocery chain Iceland, switched support to Labour citing concern about the impact of the rising cost of living on their customers. 

Higher pay and greater security are clearly in the interests of both workers and businesses, for they mean more spending and more revenues for business. 

Watering down 

Soames warned that “European model” of stronger worker rights, while benefiting those in work, is “really bad for people who are unemployed because companies are terrified to take them on”. 

This suggests some in business are oblivious to the events of the past decade or so.  

The Marmot review, for example, recognised that insecure and poor quality employment is associated with an increased risk of physical and mental health worsening. That in turn leads to absence due to illness, and worklessness.  

No wonder businesses continue to complain of staff shortages. 

Indeed his language is reminiscent of the apocalyptic and entirely inaccurate warnings that a national minimum wage would lead to two million more unemployed.  

The incoming Labour government in 1997 was right to disregard claims from the Right that the minimum wage would cost millions of jobs.  Now there is a wealth of evidence, over 25 years of the minimum wage, that it has protected the lowest paid with no employment effects at all. 

It should take unevidenced claims about the New Deal in the same spirit. 

Behind the times 

While some in the business lobby are dragging their heels, previous advocates of unconstrained free markets now advocate reform. 

The OECD’s 2018 Jobs Strategy finally put to bed its long standing celebration of flexibility and market fundamentalism.  

 “Countries with policies and institutions that promote job quality, job quantity and greater inclusiveness perform better than countries where the focus of policy is predominantly on enhancing (or preserving) market flexibility,” it said. 

In the UK, the Institute for Fiscal Studies warned that: “Higher earnings inequality, with low real earnings growth, and a very different labour market from 40 years ago have placed the world of work in a much more unequal and divisive place. To halt or reverse this trend requires significant attention be devoted to ways to restore and reinvigorate real earnings growth and to generate decent jobs with good career opportunities in an inclusive way”. 

Conclusions 

A radical and effective programme is long overdue both for workers – whether currently in employment, looking for work or will be joining the jobs market in future – and for the wider economy. 

As TUC general secretary Paul Nowak told the CBI conference last year: “Decent employers will recognise the promise of Labour’s economic reset and work with unions to boost productivity, skills and security at work.” 

Now is not the time for foot-dragging. The economy needs a major reboot and the opponents of change need to get out of the way. 

TUC slams “zero progress” on disability pay gap in last decade

New analysis shows pay gap between non-disabled and disabled workers is now 14.6% – higher than it was a decade ago

  • Disabled women face even bigger pay penalty of 30% – £3.73 an hour 
  • TUC says Labour’s New Deal for Working People would be a “game changer” for disabled workers, introducing mandatory disability pay gap reporting and a day one right to flexible work 

New analysis published by the TUC yesterday shows that non-disabled workers earn around a sixth (14.6%) more than disabled workers 

The analysis reveals that the pay gap for disabled workers across the board is £1.90 an hour, or £66.50 per week – over what the average household spends on their weekly food shop (£62.20). 

That makes for a pay difference of £3,460 a year for someone working a 35-hour week – and means that disabled people effectively work for free for the last 47 days of the year and stop getting paid today, on the day the TUC has branded Disability Pay Gap Day.  

“Zero progress” on disability pay gap 

The pay gap has fallen since last year, when the overall pay gap was £2.05 (17.2%) an hour. 

The new analysis shows that the disability pay gap is now higher than it was a decade ago (13.2% in 2013/14) when the first comparable pay data was recorded. 

And the gap is only slightly lower than when the TUC first launched Disability Pay Gap Day using 2016/17 data (when it was 15.0%). 

Disability pay gap by gender and age 

The new TUC analysis reveals that disabled women face the biggest pay gap. Non-disabled men are paid on average 30% (£3.73 an hour, £130.55 a week, or £6,780 a year) more than disabled women. 

The research also shows that the disability pay gap persists for workers for most of their careers. At age 25 the pay gap is £1.73 an hour hitting a high of £3.18 an hour, or £111.30 a week, for disabled workers aged 40 to 44. 

National, regional and industrial disability pay gaps 

The analysis looked at pay data from across the country and found disability pay gaps in every region and nation of the UK. 

The highest pay gaps are in Wales (21.6% or £2.53 an hour), followed by the South East (19.8% or £2.78 an hour) and the East of England (17.7% or £2.30 an hour). 

The research found that disability pay gaps also vary by industry. The biggest pay gap is in financial and industrial services, where the pay gap stands at a huge 33.2% (£5.60 an hour). 

Unemployment 

Not only are disabled workers paid less than non-disabled workers, they are also more likely to be excluded from the job market. 

Disabled workers are twice as likely as non-disabled workers to be unemployed (6.7% compared to 3.3%).  

And the analysis shows disabled BME workers face a much tougher labour market – one in 10 (10.4%) BME disabled workers are unemployed compared to nearly one in 40 (2.6%) white non-disabled workers. 

Zero-hours contracts 

The analysis shows that disabled workers are more likely than non-disabled workers to be on zero-hours contracts (4.5% to 3.4%). 

And disabled BME women are nearly three times as likely as non-disabled white men (6.0% to 2.2%) to be on these insecure contracts. 

The TUC says zero-hours contracts hand the employer total control over workers’ hours and earning power, meaning workers never know how much they will earn each week, and their income is subject to the whims of managers.  

The union body argues that this makes it hard for workers to plan their lives, look after their children and get to medical appointments. 

And it makes it harder for workers to challenge unacceptable behaviour by bosses because of concerns about whether they will be penalised by not being allocated hours in future. 

New Deal for Working People 

The TUC is calling for government action to end the discrimination disabled workers’ face in the jobs market. 

The union body says Labour’s New Deal for Working People would be a “game changer” for workers’ rights. 

Labour has pledged to deliver new rights for working people in an employment bill in its first 100 days. 

Labour’s new deal would: 

  • Introduce disability and ethnicity pay gap reporting. 
  • Strengthen flexible working rights by introducing a day one right to work flexibly. 
  • Ban zero-hours contracts to help end the scourge of insecure work. 
  • Give all workers day one rights on the job. Labour will scrap qualifying time for basic rights, such as unfair dismissal, sick pay, and parental leave.  
  • Ensure all workers get reasonable notice of any change in shifts or working time, with compensation that is proportionate to the notice given for any shifts cancelled or curtailed. 
  • Beef up enforcement by making sure the labour market enforcement bodies have the powers they need to undertake targeted and proactive enforcement work and bring civil proceedings upholding employment rights. 

TUC General Secretary Paul Nowak said: “We all deserve to be paid fairly for the work we do. But disabled people continue to be valued less in our jobs market. 

“It’s shameful there has been zero progress on the disability pay gap in the last decade. Being disabled shouldn’t mean you are given a lower wage – or left out of the jobs market altogether. 

“Too many disabled people are held back at work, not getting the reasonable adjustments they need to do their jobs. And we need to strengthen the benefits system for those who are unable to work or are out of work, so they are not left in poverty. 

“It’s time for a step change. Labour’s New Deal for Working People would be an absolute game changer for disabled workers. It would introduce mandatory disability pay gap reporting to shine a light on inequality at work. 

“Without this legislation, millions of disabled workers will be consigned to many more years of lower pay and in-work poverty.”