According to the OECD
, the UK already has one of the most business-friendly frameworks of employment law of any of its members, second only to the US. The chancellor, George Osborne, is obviously not convinced. He told The Sun newspaper yesterday
we talk far too much about ‘union rights’ and not enough about the rights of unemployed people to get a job. That’s why he’s increasing the qualifying period for employees to make unfair dismissal claims from one to two years.
First off, I think young George (ok, he’s older than me, but only just) has rather got his union rights mixed up with his employment rights. As someone who’s never had a proper job, that’s understandable: he’s never had to worry about his employment rights. Then again, the mix up is probably entirely deliberate. He is quite clearly setting out his stall to wage war on the unions and slowly, or not so slowly, chip away at our hard-won employment rights.
I’m not an expert, but I am sceptical that increasing the qualifying period will make a great deal of difference to the number of unfair dismissal claims. I would imagine that most employers decide quite quickly, certainly within a year, whether or not a new employee is going to work out. But of course this is based on the assumption that all employers, even those guilty of the occasional misdemeanour, act reasonably, which clearly isn’t true.
Nonetheless, the government says the change will give businesses, particularly small businesses, the confidence to take on staff. Their narrative goes that these ‘engines of growth’ are being held back because they are too fearful of being caught up in vexatious and costly unfair dismissal claims. Call me simplistic, but I don’t think this is the fear that is holding small businesses back. I’d say it’s more likely to be because our economy is flatlining.
I also don’t believe that there are thousands of people out there putting in spurious unfair dismissal claims. Even successful cases don’t get huge compensation payouts, the average is about £4,000, and the process isn’t exactly quick and easy. And if there are so many spurious claims, why are the government’s proposed charges for bringing a claim relatively low (£50-£500)? Hardly a deterrent to the ‘have a go’ fraudster. On the other hand, even a low charge could put off low-paid genuine claimants.
That’s not to say that there aren’t things about the tribunal system that could be improved. From a simple system set up to ensure a quick and easy resolution to employment disputes, it has grown increasingly complex and expensive. Unlike other courts, there is no restriction on the rights of audience, because the idea was for individuals and employers to represent themselves.
But as employment law has become more complicated, lawyers have got involved, generating the costs that the government and business organisations are so exercised about. When I worked for a trade union, which was far longer ago than I’m going to admit, officials would regularly be out of the office to present cases to a tribunal. Most of them wouldn’t dream of doing it now. The lawyers are probably here to stay, but that doesn’t mean you can’t make the system quicker and cheaper.
Another reason tinkering with the rules is unlikely to reduce the number of unfair dismissal claims is because it does nothing to prevent problems occurring and because workers will instead make discrimination claims. The TUC says three in five workers aged under 24, one-third of part-time employees and 30 per cent of ethnic minority employees have worked for their employer for less than two years and 500,000 female part-time workers would also lose out.
All this leads me to the conclusion that this isn’t about helping business – how is preventing unfair dismissal claims going to create a single job? Rather, it is a thinly disguised attack on the unions. Well, I’ll rephrase that, it’s a direct and shameless attack on them. Just to be certain they get the message, Osborne has also announced he wants to end full time trade union work in the civil service. He told The Sun "Sun readers are paying their taxes and £30million of those taxes go to pay for this. I don't think that is reasonable.”
Well yes actually, it is reasonable. Strange as it may seem to Sun readers and government ministers, unions aren’t just good for strikes, they can actually help employers resolve conflicts before they get to the tribunal stage. Shockingly, some employers recognise this themselves and actually see unions as helping to improve the working environment all round.
You don’t have to be an employment lawyer or trade union officer to realise that, surprisingly, the best way for businesses to avoid the costs of a tribunal is not to break the law in the first place, and that means dealing with problems before they get out of hand. The absurd assumption of most employers that anyone can be a manager once they’ve hung around somewhere long enough ignores the fact that not everyone has the skills to do the job properly. And I’d be willing to bet that the decline of unions in the workplace has exacerbated this problem rather than the other way around.
I suppose, to be fair, employers are having a hard time right now. There are so many favours and freebies they have to give their staff – maternity leave, paid holiday, equal treatment – that we should cut them a bit of slack. And I am sure that gradually taking back all the little sweeteners handed out to workers over the last 13 years will encourage them to start employing more people and get the economy going again.
But do you know what, if I was the unemployed person sitting at home that George Osborne seems so concerned about I wouldn’t want a crap, low-paid, job with no prospects where my employer can just turn round after 13 months and decide he doesn’t like the cut of my jib with no comeback. I suppose the problem is that the chancellor, like most of his colleagues in government, has no idea what that kind of job is like. And worse, they probably don’t care.