Fishing for red herrings

When it comes to the Brexit debate, employment law isn’t really that big a deal. But as Sarah O’Connor says, both sides are trying to make it into one:

Some in favour of Britain leaving the EU, such as Patrick Minford, economics professor at Cardiff University’s business school, say the UK needs to reset its relationship with the EU to “jettison excessive protection and over-regulation, notably in the labour market”. Trade unionists who want to stay in the EU, such as Frances O’Grady, general secretary of the Trades Union Congress, warn that “working people have a huge stake in the referendum because workers’ rights are on the line”. Both these claims give the impression that UK employment law would change significantly in the event of Brexit.

For most employers, though, it’s not that important and the bits they are most worried about have nothing to do with the EU:

The truth is that most employers are not angling for these EU-related rights to be repealed. When I talk to companies, they usually complain about four employment issues: the new higher minimum wage for people aged 25 and over; the “apprenticeship levy”, a payroll tax for large companies; restrictions on skilled migrant workers and the requirement for large companies to publish their gender pay gaps. None of those has been forced on the UK by the EU; all are policies that have been dreamt up by the current Conservative government.

For years, politicos, journalists and policy wonks have made a lot more fuss about regulation than business people. There is no great clamour from employers to change employment law. When the government came up with various hare-brained schemes during the last parliament, the reaction of business leaders was indifference. The Beecroft proposals were treated with derision by lawyers and employers and the shares for rights scheme was almost completely ignored. If the economy was really groaning under the weight of employment protection law, surely such measures would have been greeted by employers with effusive delight, instead of a collective shrug.

Employment law can be irritating and some claims are vexatious but the risks of being taken for a large amount of money are fairly remote. Stories of people being bankrupted by employment tribunal cases are usually put about by hysterical columnists or people trying to sell indemnity insurance. Thanks to the introduction of fees, you are less likely to be taken to tribunal now than you were five years ago and, even if you do lose a case the amount you get stung for will probably be less than £10,000. The vast majority of managers go through their entire careers without ever going anywhere near an employment tribunal.

Furthermore, as Richard Dustan says, a lot of employment law is quite popular:

[I]t would be a bold (or simply daft) Tory government that decided to cut the hardly over-generous statutory entitlement to paid holiday – just four weeks plus bank holidays – or to blatantly roll-back the scope of anti-discrimination law, or to slash (paper) maternity rights. These rights are now well-entrenched and, in most cases, extremely popular. So, even someone as tactically inept as George Osborne would surely see that “Vote Tory, get less holiday” is not a great campaign slogan.

Or, as Sarah says:

It is hard to imagine any government going into the 2020 election with “bring back sexism in the workplace” or “let’s have fewer paid holidays” on their leaflets.

Even after Brexit, the UK would not be the de-regulated heaven or hell that some people on both sides like to claim. It might raise interesting issues at what Darren calls the geeky margins (and he’d know) but the idea that it would be an opportunity to dismantle all the UK’s domestic employment legislation is fanciful.

When it comes to employment protection, the UK is already one of the least regulated countries in the developed world. In some countries, where regulation is very onerous, relaxing it might help to boost the economy. If the UK was ever anywhere near that point it is long past it now. Employment protection laws are now so light that even removing them completely would make very little difference to this country’s competitiveness. It might even make it worse.

Employment law isn’t a Brexit issue because it simply isn’t an issue. Most employers are not that worried about it and its economic impact is fairly small. As red herrings go, they don’t come much redder than this.


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10 Responses to Fishing for red herrings

  1. John says:

    I suspect those citing employment law and regulations for and against Brexit know it is all nonsense but they don’t care. They just want a sound-bite in support of their stance and they don’t care where they get it from. It was the same during the 1975 referendum campaign too, I believe. Hardly anyone ever told the truth of the situation; just that bit that might support their position.

  2. Florence says:

    Employment law has come about through the Human Right laws, and it is the Human Right laws that the Brexiters want to repeal. They have always harboured a distinctly swivel-eyed attitude to Human Rights. You’re very probably right that there really is little scope for Employment Law changes, but for the disabled, the refugees, the asylum seeker, poor families and children, the homeless, and those at the mercy of the state in prisons and other institutions it is a whole different kettle of fish, to carry on with your theme. An interesting article, but I think creating a false sense of security for those who have not been paying attention to the sheer spite directed at the vulnerable and punishing of those who have no other protection than the Human Rights Acts. The UN are already conducting two separate investigations into the UK abuse of the Human Rights of our vulnerable which shows that the protections we are supposed to uphold have already been treated with contempt by the Tories, especially those in the Brexit camp.

  3. JohnM says:

    But the ECHR is nothing much to do with the EU…..
    And UK employers have been ignoring employment legislation for as long as it has existed…sexual discrimination on pay is practically an employment feature in the UK (the current Doctor/NHS/government dispute features a hefty dose of contractual sex discrimination)
    Currently a host of UK construction companies are being stung for running an illegal employment discrimination database…compensation, so far, is over 30 million.
    Health and Safety is a joke, with the HSE staff cut back to arse-licking levels.
    No, of course the employers are not worried about leaving. Any laws that change will just be ignored anyway.

  4. Gillemachoi says:

    Sarah O’Connor’s observation that “It is hard to imagine any government going into the 2020 election with ‘bring back sexism in the workplace, … on their leaflets” is surely correct as no-one would be so blatantly stupid.

    Far better to just do it as quietly you can, and trust that either opposing those changes is too much trouble or that any opposition can be neutralised. This is what the government is apparently trying to do with the controversial new contract for junior doctors; the Department of Health’s own Equality Analysis of it appears to accept at paragraph 83 that changes to certain pay elements may “disadvantage women” and that they “may disadvantage lone parents (who are disproportionately female) due to the increased cost of paid childcare in the evenings and weekend” but it concludes that this is okay because “any indirect adverse effect on women is a proportionate means of achieving a legitimate aim.” This latter is the test in the Equality Act 2010.

    The question then is ‘how much sexism in the workplace is too much?’ which is some distance removed from Sarah O’Connor’s starting point.

    • Alex says:

      Exactly! I mean the Beecroft proposals that Rick mentioned weren’t in the Conservative manifesto, just some guff about cutting “red tape”. I think it’s quite likely some swivel-eyed Thatcherite minister would listen to a few too many right-wing think tanks and gut important legislation quietly. I mean legal aid was quite well entrenched, but they still managed to undermine it, they can do so on employment law too, given the opportunity.

  5. Patricia Leighton says:

    Modern employment law did not emerge from any notions of human rights. It probably emerged from the Contracts of Employment Act, 1963, which for the first time required employers to give notice to employees, information about their terms of work etc. Then there was the Redundancy Payments Act,1965-both fairly low key interventions and to an extent concerned simply to ensure that change at work was managed a little more fairly.
    You are right in the article about the consequences(or not) of BREXIT. I would though raise one issue, and that is the status of the decisions of the ECJ on matters such as part-time work,TUPE, collective redundancies and, most controversially, the definition of working time. Some of these do ‘excite’ employers and the situation would need clarification, as these cases are embedded in our common law system.

  6. It’s always worth distinguishing in these matters between the interests of big businesses, who instigate much of the employment regulation enacted at both the UK and EU levels, and small businesses, who are a disproportionately important political constituency in the eyes of the Tory party and the media.

    The outers claim that Brexit would “liberate” us is targeted at the latter, plus the self-employed and aspirational employed. In terms of likelihood to vote, and potential impact on the opinions of others, this is a significant cohort, though probably outweighed by corporate employees who bias towards ‘remain’ through positive identification with globalisation.

    In contrast, those who insist that employment safeguards would be jeopardised by Brexit are the same people who held such high hopes for the EU “social chapter” in the late 80s and early 90s. Employment law is a marginal issue to the referendum because the chapter turned out to be a damp squib. The reality of the EU’s social agenda is micro-jobs and wage repression in Germany, and youth unemployment and further demands for “structural reform” in most other countries.

  7. Jim says:

    I’m sure a small business like a corner shop or plumber or hairdresser will be very glad to know that its ‘probably less than £10,000’ they’ll have to shell out (plus legal expenses of course) if they lost an employment case. After all we all know small self employed types are coining it in, they can afford it!

    • ChrisA says:

      This is correct – large companies don’t at all object to complex regulations or onerous employment laws – it keeps them safe from lean and hungry competitors. Companies that don’t exist don’t complain about regulations!

  8. Pete North says:

    “Employment protection laws are now so light that even removing them completely would make very little difference to this country’s competitiveness.”

    There’s a good reason for that.

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