Is the issue of workers’ rights post Brexit now back on the agenda?

Now that we have a new Prime Minister in situ, attention has quickly turned to Liz Truss’ actual policy agenda. Many comments have been devoted to the list of challenges she faces – every bit as serious as those encountered by almost any of the post-war Prime Ministers with the possible exception of James Callaghan.

Some are new problems and others more intractable. One particular debate that seems to have rebounded concerns the important issue of workers’ rights.

It may be recalled that during the days when David Cameron was Prime Minister, there was much talk of business feeling strangled by "red tape". If only the labour market could be de-regulated (it was said), individuals would be encouraged to commit to investing into businesses to make them grow.

Not everyone was necessarily convinced, however and at the time it became difficult to find employer organisations that would actively and publicly support such a concept (although there were some). The Government’s language then changed. Rather than suggesting business was hamstrung by red tape, they talked of a "perception" that that was the case.

During the course of the Brexit debate in 2016 there was discussion about the labour laws introduced into the UK as a result of our membership of the EU. On becoming Prime Minister, however, Boris Johnson, gave assurances that workers’ rights would not be affected by Brexit.

In fact, the Conservative Party's manifesto for the 2019 General Election contained a significant section entitled "Fairness in the Workplace" which said that the "increase in employment that the Conservative Government has overseen since 2010" was "proof that there is no contradiction between high employment and high standards - between dynamic growth and protecting employees from unfair policies and discriminatory treatment.” On the subject of Brexit, it said "once we have got Brexit done, we will go further. Because people cannot fulfil their potential if they do not have jobs that treat them with dignity and respect, and if they are not in control of their lives and their futures.”

Wind on a little and we may find things are changing. Reports suggest Liz Truss does now want to look again at the issue of workers’ rights. Doubtless helping her do so will be the new Chancellor of the Exchequer, Kwasi Kwarteng, who as Business Secretary only last year was forced to deny there was any plan for a consultation paper on a post-Brexit review of workers’ rights. This was in light of the fact that the reaction to rumours that this was being planned, not just from the employee community, but from some employers as well, was lukewarm at best, and outright hostile in some quarters.

If the Cabinet’s philosophy is now to be different (and arguably the appointment of Jacob Rees Mogg as Business Secretary may make this more likely), we should consider carefully what regulations they may have in mind. At the moment, it seems attention has been focused on the issue of the 48 hour working week (which many workers opt out of anyway), and perhaps to a lesser extent, other rules in relation to working time such as rest periods.

But few may think any amelioration of those particular regulations is seriously going to change businesses attitude to innovation and growth. So might this turn out to be “the thin edge of the wedge”? In other words, will the Government in fact turn their attention to other more substantial employment rights? These may include the right to an uncapped claim for damages for discrimination. This is a provision which stems directly from our former membership of the EU and contrasts sharply with our laws on unfair dismissal, where damages are specifically capped by statute. In reality, because any claim made is directly referable to the losses that the claimant employee has suffered, in many cases that come to Tribunal, this distinction may not make a huge difference. But there are undoubtedly some cases, where because there is no limit on the damages that can be awarded, employees can win substantial awards. That can happen particularly in the cases of high earners in the City and elsewhere, but also claims from those who may have suffered "career loss of earnings" because they are disabled.

However far reaching, we can expect the workers rights’ debate to be highly controversial in the business community. Many business leaders recognise the importance of protecting workers rights. Is business really now going to support or encourage the diminution of employees and workers’ rights, and even if they did, will this form a critical part of their thinking when considering whether or not to invest?

Only three years ago the Government committed in its Manifesto to making the UK "the best place in the world to work". Is Liz Truss now about to take us down a different path?  We already seem to be in for a battle between the Unions and Industry over rates of pay and wage increases in the context of the rising cost of living. Is the debate now about to get even more febrile, with fundamental employment rights at stake too?

Further information

If you have any questions regarding this blog, please contact Richard Fox in our Employment team.

About the author

Richard Fox is a senior consultant within the Employment team. He has been at Kingsley Napley throughout his career and until October 2019, led the Employment team since its inception more than 25 years ago.