Post-pandemic economic growth: UK labour markets: Government response to the BEIS Committee’s Tenth Report of Session 2022–23

Twelfth Special Report of Session 2022–23

Author: Business and Trade Committee

Related inquiry: Post-pandemic economic growth: UK labour markets

Date Published: 20 July 2023

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Contents

Twelfth Special Report

The Business, Energy and Industrial Strategy Committee (BEIS) published its Tenth Report of Session 2022–23, Post-pandemic economic growth: UK labour markets (HC 306) on 21 April 2023. The Department for Business and Trade supplied a response on 7 July 2023. The response is appended to this report. The Committee’s recommendations are in bold Italic type. The response from the Department for Business and Trade is in plain type.

Letter from Kevin Hollinrake MP, the Parliamentary Under Secretary of State, Department for Business and Trade, to the Chair of the Committee, dated 6 July 2023

Dear Darren,

I thank this Committee for the report, carried out during its previous capacity as the Business, Energy and Industrial Strategy Committee, investigating post-pandemic economic growth and UK labour market. I am writing to offer a response to the recommendations directed at the Government in your report.

As outlined in the report, the UK at present has almost record low unemployment, near-record high employment and a high number of current vacancies.Our effective implementation of labour market policies has helped ensure the labour market remains flexible and resilient, and the Government continues to work to grow the economy.

I welcome the thorough research and detailed recommendations offered as part of the inquiry. The Government will continue to find ways to support the labour market and to drive economic growth. As set out in our response to your report, the Retained EU law (Revocation and Reform) Bill provides an opportunity to replace years of EU regulation with a more agile, home-grown regulatory approach that specifically meets the needs of the UK. We are consulting on reducing time-consuming reporting requirements under the Working Time Regulations, which could save employers around £1bn a year. We are also simplifying annual leave and holiday pay calculations in the Working Time Regulations, and streamlining regulations that apply when a business transfers to a new owner. These proposals do not seek to remove rights, but instead remove unnecessary bureaucracy in the way those rights operate.

These measures build on the strengths of our robust and dynamic labour market and give businesses the confidence to create jobs and invest in their workforce, allowing them to generate long-term prosperity and economic growth.

Appendix: Government Response

Introduction

The UK labour market is performing strongly, and our traditional indicators of labour market health are strong by historical standards with near-record high levels of employment, near-record low levels of unemployment, and near-record low inactivity rates.

The future of the UK economy and labour market is an exciting one. We will capitalise on technological innovation and advancement whilst ensuring this does not have a negative impact on workers.

The Government is taking steps, outlined below, to maintain the strength of the labour market and address any issues which inhibit economic performance or leave workers vulnerable to exploitation or poor treatment.

Labour Market Statistics

1. Ministerial responsibility for labour market policy is fragmented across Whitehall departments. We therefore call on the Government to consider the following:

a) establish a Ministry of Labour;

b) appoint a new Minister of State for Labour in the Cabinet Office with the authority to convene and coordinate labour market policy across Whitehall; and

c) establish a Cabinet Committee on Labour, chaired by a Business and Trade Minister, which convenes each relevant Minister from each relevant Department on labour market policy. (Paragraph 20)

In February 2023, departmental structures were changed to reflect the Prime Minister’s priorities (including for the labour market and wider economy) and to better deliver economic growth for the British people.

The new Department for Business and Trade (DBT) is focussed on five priorities:

  • Removing barriers to business;
  • Helping UK business to grow by selling their products overseas;
  • Making the UK the top investment destination in Europe;
  • Attracting and retaining the industries of the future; and
  • Defending free trade.

DBT, as a successor to BEIS, retains extensive links across Whitehall that facilitate effective and collaborative working to ensure the UK labour market is as strong and effective as possible. These links exist at both ministerial and official level and can be demonstrated most recently through the extensive cross-Government work aimed at increasing workforce participation.

The Government believes the structures now in place will drive effective labour market policy and delivery, and that maintaining separate domains of departmental knowledge and expertise is an essential component of that delivery. Therefore, we do not feel it necessary to further alter the machinery of Government.

AI and Tech

2. We call on the Government to introduce, whether by statute in the Data Protection and Digital Information (No. 2) Bill, or by other means, a requirement

a) on businesses to conduct impact assessments to understand the scope and consequences of the use of new technologies in the work place; and

b) for workers to have the right to consultation and notification where the application of technology in the workplace will result in the surveillance of a worker, or result in a significant change to their work. That notification should explain in plain English what the technology is, when it is being implemented, how it will be operated, and what the impact will be on the worker. We encourage employers to involve workers in the design and implementation of new workplace technologies from the start of that process. (Paragraph 39)

The Government recognises that whilst the increasing development and use of new technologies (including AI) can create wide social benefits, including more and better jobs, it can also introduce new risks and challenges such as changes in the workplace.

The Government recognises that the deployment of technologies in workplaces involves consideration of a wide range of regulatory frameworks—including data protection law, human rights law, potentially also legal frameworks relating to health and safety, and, employment law.

The Government’s wider approach to the governance of AI and emerging technologies will also play an important role. For example, the white paper on AI regulation, published in March for consultation, describes a context specific approach to AI regulation, to ensure our expert regulators can help us maximise the opportunities brought by AI while keeping people safe and secure.

When technologies use personal data, the current data protection framework provides robust protections for data subjects, including in workplaces. The fairness, lawfulness, and transparency principle requires employers (data controllers) to be transparent with their employees (data subjects) about how their personal data is used, including for monitoring purposes. Article 13 UK GDPR also sets out information to be provided where personal data is collected from their employees, which includes information around the purpose of the processing for which the personal data are intended as well as the legal basis for the processing.

The accountability principle encourages employers to conduct appropriate impact assessments when personal data is processed. ICO guidance sets out that it is good practice to consult affected data subjects and include summaries of findings in the assessment.1

The Data Protection and Digital Information Bill will reinforce and provide further clarification with respect to the important safeguards for solely automated decision-making (as set out in Article 22 UK GDPR), which may be used in some workplace technologies. These safeguards ensure individuals are made aware of, and can seek human intervention regarding, significant decisions that are taken about them through solely automated means. The reforms to Article 22 will make clear both employers’ obligations and employee rights in these scenarios.

The existing data protection legislation together with the reforms contained in the Bill provide important safeguards to employees in a data protection context. The Government maintains a pro-innovation stance and does not believe excessive restrictions on the use of technology are appropriate, nor that the Bill is the appropriate vehicle to address the wider proposals raised in the Report.

3. It has yet to be seen what effect the Science and Technology Framework recently announced by the Government will have on digital skills development. We call on the Government to bring forward a new data poverty and digital skills strategy that will, amongst other things, set out how workers will be supported in the development of their digital skills. (Paragraph 50)

Last year, the Government launched the UK Digital Strategy, which set out a commitment to develop digital skills across the whole of the UK. Ensuring everyone has the digital skills they need to thrive in the workplace will be critical for sustained economic growth. The benefits of doing so are significant—by continuing to support and strengthen digital ecosystems the UK tech sector’s annual gross value added (GVA) has the potential to grow by an additional £41.5 billion by 2025 and create a further 678,000 jobs.

The Government is committed to improving the level of digital skills among adults in the UK, so that all adults have the essential digital skills needed to participate actively in life, work, and society. To achieve this, we have started to implement major reforms to the adult digital offer, ensuring that adults have access to high quality, employer supported qualifications which are supporting people to train, retrain and upskill so they can climb the ladder of opportunity towards better jobs, better wellbeing, and better options for the future.

A good computing education lies at the heart of all technological innovation; that’s why the Government overhauled the outdated ICT curriculum and replaced it with computing. The Government has also invested over £100 million into the National Centre for Computing Education (NCCE) to improve the quality of computing education and drive up participation in computing at GCSE and A level. Outside of school, the Government is supporting adults to develop digital skills. As part of our ambition to level up opportunities across the UK, it is imperative that people can upskill or reskill quickly without having to move. Our National Skills Fund offers do just that, with free level 3 qualifications for adults, and Skills Bootcamps in digital courses (including coding, AI, and cyber security) available across England.

To build digital capacity at the local level, the government continues to support the Local Digital Skills Partnerships (LDSPs) established in eight regions across England. These Partnerships bring regional stakeholders together from all sectors to help increase digital skills capabilities across the country. The regions operating an LDSP are Lancashire, Heart of South West, West Midlands, South East, Cheshire & Warrington, Cornwall & Isles of Scilly, West Yorkshire and Hull and East Yorkshire.

The Government understands the digital skills gap and shortage cannot be tackled by Government action alone. As part of the UK Digital Strategy, the Department for Science, Innovation and Technology (DSIT) launched the Digital Skills Council, bringing together government and industry to drive industry-led action focused on strengthening the UK’s digital workforce.

The Council brings together industry leaders and training experts from Starling, Google, Future Dot Now, Microsoft and others, to address industry’s current demand for digital skills and in the future. The Council is co-chaired by the Minister for Tech and the Digital Economy, Paul Scully MP and Phil Smith CBE FREng, chairman of British semiconductor firm IQE Plc.

The Government recognises that some may experience barriers to the adoption and use of digital technologies, and that many households are struggling to pay their bills as a result of the rise in the cost of living. To support those on low incomes to stay connected, the Government has worked with the telecoms industry to bring low-cost, high-quality social tariffs into the market. These fixed and mobile offers are available in 99% of the UK, from a range of providers including BT, Three, Sky, Vodafone, and Virgin Media O2 as well as other suppliers.2 Social tariffs are available to those claiming Universal Credit and other means-tested benefits and start at £10 per month.

Around 2,900 public libraries in England provide a trusted network of accessible locations with skilled staff, volunteers, free DCMS-funded Wi-Fi, public PCs, and assisted digital access to a wide range of digital services. Many work directly with organisations such as Good Things Foundation to provide structured learning on digital skills, which help boost digital inclusion and also employability chances, as well as less formal drop-in assistance and advice.

Public libraries also not only provide digital support or access to kit or data in situ; increasingly libraries are lending portable devices, often targeted to those more likely to be digitally disadvantaged. They also help to signpost people in need of further digital support to providers or deals that can help them (for example, the social tariffs mentioned above, or to assistance from organisations like the Digital Poverty Alliance for disadvantaged families in need of devices).

4. We note with concern that there is a lack of investment in workplace training and reskilling. We therefore ask the Department to consult with business on the reasons for such lack of investment and consider what incentives would increase investment in workplace training. (Paragraph 51)

The Government recognises that there is a lack of private investment in workplace training and reskilling in the UK. This can be explained to some extent by the financial constraints caused by the pandemic, the rise of energy prices, and wider inflation but some of this shortfall of investment does predate these challenges.

DBT works closely with business to understand the challenges they are facing and address them. Whilst it should remain the industries’ responsibility to address skills shortages in their sectors by increasing investment in training, the Government has taken a range of actions to ensure that the UK has the right tax framework, and the skills system is both accessible and aligned with industry needs.

The UK tax system is internationally competitive with our tax-to-GDP ratio still lower than Germany, France, and Italy. The Spring Budget introduced a package of reforms to support enterprise and investment, such as increasing the generosity of capital allowances and support for R&D intensive SMEs. We also announced reforms to capital allowances, introducing full expensing for three-years to support business investment (with a commitment to make the reform permanent when the fiscal conditions allow).

It must primarily remain industries’ responsibility to address their medium- and longer-term skills shortages but DBT has been working with Defra, DWP, DfE and other departments to examine where Government can better assist with constraints around the training offer. DBT is also examining where it may better use its funding levers to better drive the sectors skills investment and is supportive of the need to improve the image of the sector.

For instance, in the construction sector, DBT has facilitated the introduction of different flexibilities through initiatives such as:

  • An Apprenticeship Levy Transfer Pledge where larger companies can transfer unspent Levy funding to their supply chains;
  • a pilot for Flexi-Job Apprenticeship Agencies to support firms and apprentices to fulfil the full apprenticeship learning period where short contracts are the norm; and
  • SME brokerage contracts have been awarded to raise awareness, increase engagement and grow the volume of apprenticeship starts within ‘disengaged’ SMEs that have not had an apprentice within the last 24 months.

Provision of shorter training options through the use of Skills Bootcamps, Occupational Traineeships and the Construction Industry Training Board’s (CITB) work experience Onsite Experience Hubs supporting construction career opportunities and employment.

There is a need to clearly articulate the skills employers and employees need to use artificial intelligence (AI) effectively in the workplace. Industries have expressed their willingness to fund employees to undertake AI training but have not found training that suits their needs—including training that is business-focused, modular and flexible.

Reflecting this feedback and through consultation with expert stakeholders, we have developed guidance for businesses on the types of skills and knowledge that non-technical employees need to use to interact with AI. The guidance, due to be published this summer, will enable employers and training providers to design courses that give their employees AI skills relevant to their business needs.

5. We agree that the proposed Lifelong Loan Entitlement has the potential to be “transformative” in encouraging retraining and upskilling and ask the Government to conduct a review of the scheme one year after its commencement and to report its findings to this Committee. (Paragraph 52)

The Lifelong Loan Entitlement (LLE) will be delivered from academic year 2025/26, providing individuals with a loan entitlement to the equivalent of four years of post-18 education to use over their working lives (£37,000 in today’s fees). The Government is committed to delivering at pace to introduce the LLE from 2025. However, delivering its vision will require extensive changes to the student finance system and the types of courses available.

The Government will take a phased approach to modular funding, focusing on higher technical courses which have clear employer checks or where they address skills gaps to support learners into jobs which employers need. From the start of AY25/26, this will be initially targeted at:

  • All Higher Technical Qualifications; and
  • Technical qualifications at levels 4 and 5 currently funded through the ALL system which have a clear line of sight to an occupational standard and employer support.

We have the intention to expand out to include Level 6 modules from 2027.

Our ambition is to iteratively deliver LLE modularity policy between 2025 and 2027, with work to adapt behaviours going beyond. Although we can share findings one year after it’s commencement, we will still be within our change programme and still working towards our benefits.

6. We ask the Government for an update on its thinking in relation to the use of computer evidence in criminal and/or civil proceedings and to prioritise this area of work at the Law Commission if it has not already done so. (Paragraph 74)

The use of computer evidence in criminal proceedings in England and Wales must follow the Common Law rule, namely, that a presumption will exist that the computer producing the evidential record was working properly at the material time and that the record is therefore admissible as real evidence. It is important to note that this presumption can be rebutted if evidence to the contrary is adduced. In that event, it will be for the party seeking to produce the computer record in evidence to satisfy the court that the computer was working properly at the material time.

In the Horizon case, the Court of Appeal judgment concluded that a key issue in this case was how the Post Office, as prosecutor, presented Horizon as reliable despite evidence to the contrary, and it should have disclosed that evidence to the courts. The Court of Appeal referred to the High Court Judge Mr Justice Fraser’s previous findings that the Post Office, as prosecutor, demonstrated “a simple institutional obstinacy or refusal to consider any possible alternatives to their view of Horizon, which was maintained regardless of the weight of factual evidence to the contrary”.

The Government has no plans to review the presumption, however, the Ministry of Justice (MoJ) will work with the Lord Chief Justice’s Criminal Procedure Rule Committee to ensure that any lessons learned from the Post Office Horizon IT Inquiry3 relating to the disclosure and introduction of evidence are reflected in the Criminal Procedure Rules.4 Pending the outcome of the ongoing Inquiry, a small working group is considering current practices and potential problems, drawing on case law and experience in this and other jurisdictions.

With regards to the Law Commission, it included Technological Advances and Procedural Efficiency in the Criminal Courts5 as an idea for a potential area of law reform as part of its future 14th Programme of work. The Commission is now in the process of finalising the areas of law that will be included in the 14th Programme, which will be announced in due course.

In the civil courts in England and Wales, the rules of evidence are governed by the Common Law, the Civil Evidence Acts and the Civil Procedure Rules. The effect of these is to provide judges and the courts with wide ranging case management powers over the admissibility of evidence. Furthermore, evidence in civil matters must be supported by a witness statement and a statement of truth. It is a feature of the adversarial nature of civil litigation that all evidence submitted is assessed by all parties as well as the judge and may be subject to challenge on admissibility and authenticity. The overall effect of the legislation and rules is to build in safeguards, and all evidence is subject to critical examination.

At this juncture, the Government is not minded, nor have any of the various IT or legal organisations approached the Civil Procedure Rule Committee with a request to amend the Rules. Moreover, the Government has not moved to amend any of the statutory provisions relating to evidence. As with other reforms, the Civil Procedure Rule Committee, chaired by the Deputy Head of Civil Justice on behalf of the Master of the Rolls, would give any proposed changes their due consideration.

7. We question, however, whether existing regulators have the expertise to perform the functions proposed in the recent White Paper on regulation of AI. If regulators will need to recruit additional staff with such expertise, the Government should consider carefully whether they can do so from existing budgets without compromising other important regulatory functions. (Paragraph 82)

The white paper on the regulation of AI acknowledged the importance of ensuring all regulators have the capabilities they need to regulate AI effectively in line with the principles-based framework. It outlined a number of potential capability gaps that have been identified through our previous research, including those relating to technical, regulatory and market-specific expertise and organisational capacity.

The white paper proposed a set of central functions to oversee, support and bring coherence to the effective implementation of the framework by regulators within their existing enforcement capabilities and legal powers. As set out in the white paper, the Government will work with regulators to identify how regulators’ work—including data collected from their own regulatory activities—can support the proposed central monitoring and evaluation function in order to ensure the best outcomes for the whole economy.

As part of the ongoing consultation on the white paper proposals, government is working closely with regulators and other expert organisations (such as the Alan Turing Institute) to assess respective levels of need and pinpoint the most effective ways to improve regulator access to expertise. We recognise that levels of need vary considerably across the regulatory landscape and options to support upskilling will need to reflect this variation, as well as the increasingly central role that the AI is coming to play within all regulated sectors and activity.

It is exactly this acknowledgement of the fallibility and limitations of regulators that means we should not be making prescriptive ex ante laws and empowering regulators over new technologies.

8. We ask each of the regulators referred to by the Government in its recent White Paper to write to this Committee setting out what capacity, expertise and established policy it has in respect of the application of AI in the workplace and to set out what additional resources are required to deliver this new area of responsibility. We ask those regulators to write to this Committee no later than three months following publication of this report. (Paragraph 83)

The Government recognises the strong stakeholder interest in the activities of regulators across the AI landscape and the ensuing importance of transparency in the capacity, expertise, and policy capabilities they have in respect of the application of AI across different remits and contexts. The Government is actively liaising with regulators on this issue as part of the ongoing white paper consultation and will inform relevant bodies of this recommendation.

We welcome any further steps regulators take to engage Parliament, although as independent bodies, it will be for them to decide if and how they intend to do this. The Government will continue to work with regulators and parliamentarians to ensure the most effective ways to improve regulator access to expertise as the AI framework is implemented.

9. […] there is a significant risk from the lack of attention on the unwelcome or unintended consequences of the use of technology and automation in the workplace, whether that is in the warehouse or in a worker’s home. Surveillance in the workplace may have value if it prevents malpractice and helps to improve productivity in a way which is agreed through consultation with the workforce and is applied within agreed parameters. But it is likely to be destructive of worker morale if it is imposed in a heavy-handed way. We ask the Government to consult on an enforceable code of practice on the use of surveillance technology in the workplace. (Paragraph 85)

The Information Commissioner’s Office (ICO) is responsible for advising on the current position of the law and has produced draft guidance on monitoring at work.6 The guidance provides clarity and practical advice to help employers to comply with the UK General Data Protection Regulation (UK GDPR) and the Data Protection Act 2018 (DPA 2018). The ICO published a consultation on this guidance, as well as another consultation around providing practical guidance about handling the health information of workers in accordance with data protection legislation. Both consultations closed in January 2023. These consultations are the first part of an ongoing ICO project to replace its employment code of practice with new, UK GDPR-focused guidance which forms a key part its three-year strategy ‘ICO25’.

Employers also need to consider the following laws when considering whether or how to monitor workers:

  • The Human Rights Act 1998 (HRA): Article 8 of the European Convention on Human Rights (ECHR) provides that everyone has the right to respect for private and family life. The Government recognised this is increasingly important due to the rise of homeworking. Workers’ expectations of privacy are likely to be significantly greater at home than in the workplace and the risks of capturing family and private life information are higher. Section 3 of the HRA provides that primary and secondary legislation must be read and given effect so far as possible in a way that is compatible with the ECHR.
  • The Equality Act 2010 (EA): Employers must not use surveillance in a manner which constitutes unlawful discrimination under the EA.
  • The Employment Rights Act 1996 (ERA): Employees with two years continuous service are protected from unfair dismissal, which would encompass circumstances where employees’ Article 8 and UK GDPR rights have been breached in the algorithmic decision-making process that led to the dismissal.
  • The Trade Union and Labour Relations (Consolidation) Act 1992: Employers must not use AI and surveillance to suppress union membership or activity by, for example, employing algorithms which are weighted towards refusing or terminating one’s employment if they join or participate in a trade union.

The Equality and Human Rights Commission has committed to ensuring that there is improved understanding of how the Human Rights Act applies to laws concerning the use of new technology in terms of privacy, surveillance, and the use of data. It will identify potential gaps in the law created by the development and use of new technologies and advise on whether and how the law should be updated to provide protection from discrimination and breaches of rights.

10. We recommend that a taskforce of relevant enforcement bodies be established, alongside the Centre for Data Ethics and Innovation and the Trades Union Congress, to assess the implications of technology in the workplace, to consider whether enforcement of labour laws is effective, and to make recommendations on whether further legislation is required. We recommend that the taskforce be asked to produce an initial report by autumn 2024. (Paragraph 86)

The AI Standards Hub was launched in October 2022 to improve the governance of AI, complement pro-innovation regulation and unlock the huge economic potential of these technologies to boost investment and employment now the UK has left the European Union. The Standards Hub is intended to provide a coordinated contribution to standards development on issues such as transparency, security, and uncertainty, with a view to helping organisations demonstrate that AI is used safely and responsibly. The AI Standards Hub held an inaugural session of the AI Standards Forum for UK Regulators in March 2023.

The Centre for Data Ethics and Innovation published also published its AI assurance roadmap in December 2021. Impact assessments, performance testing and, possibly, pre-release verification or certification against AI standards in the longer term, are a few of the assurance mechanisms that can help organisations innovate responsibly while also determining whether an AI system complies with applicable standards and regulations.

For labour market enforcement bodies specifically, the Director of Labour Market Enforcement has a statutory responsibility to assess the scale and nature of non-compliance in the labour market. Her 2022–23 strategy was published in March and sets out her assessment of the risks in the labour market and for vulnerable workers. The DLME has identified that there are potential implications from AI and as part of the annual risk assessment, will be holding an exercise to consider the wider threats of AI and jurisdictions. We will refer your recommendation to the DLME.

Workers’ Rights and Protections

11. There is evidence to suggest that we cannot be complacent about the effectiveness of existing law in protecting women who are pregnant from redundancy, or who are on maternity leave, or who return to work after pregnancy. We welcome the Protection from Redundancy (Pregnancy and Family Leave) Bill as a small step, but the Government may need to return with stronger protective measures if evidence of discrimination persists. To collect this evidence we recommend that the Government commissions research similar to that conducted by the Equality and Human Rights Commission for BEIS in 2016. (Paragraph 103)

The Government agrees that it cannot be complacent when it comes to protecting women who are pregnant and new parents from discrimination. We are pleased that the Committee has recognised the Government’s support for the Protection from Redundancy (Pregnancy and Family Leave) Bill. We are therefore pleased to confirm that this Bill received royal assent, and became an Act of Parliament, on 24 May. The result of this legislation, and subsequent regulations, is that there will be additional redundancy protection available from the point a woman tells her employer she is pregnant, through to 18 months after the child is born.

The Government acknowledges the ongoing need for data on the extent of discrimination against pregnant women and new parents. We do not, however, believe that re-running the 2016 research project is the best way of obtaining this. That is why we continue to work with the Pregnancy and Maternity Discrimination Advisory Board7 to determine how best to assemble this evidence base.

DBT is considering a programme of analysis based on a range of existing data sources (such as Employment Tribunal claims data and the monthly Labour Force Survey) which can be augmented by surveys, such as those currently undertaken by the TUC, Pregnant then Screwed, and others.

12. We invite the Government to confirm whether any evaluation of the Shared Parental Leave scheme is still active, and to set out what plans it has to increase take-up. (Paragraph 108)

Evaluating Shared Parental Leave and Pay is an important part of the policymaking process. As part of the evaluation, we commissioned large, representative surveys which asked about a range of parental leave and pay entitlements as well as about Shared Parental Leave specifically. The Shared Parental Leave Evaluation Report was published in June 2023 and can be accessed here: https://www.gov.uk/government/publications/shared-parental-leave-spl-evaluation

Shared Parental Leave gives working families choice and flexibility about who cares for their child in the first year, and when. It challenges the assumption that the mother will always be the primary carer and enables working parents to share up to 50 weeks of leave and up to 37 weeks of pay in the first year of their child’s life, if they wish. This enables mothers to return to work early and share their remaining maternity entitlement with fathers and partners, allowing them to be the child’s primary carer.

Information provided by employers to HM Revenue and Customs shows that take-up of Shared Parental Leave has doubled since the first years of its introduction, and it is now broadly in line with the Government’s initial estimate. Shared Parental Leave requires a huge cultural change. Other countries that have implemented schemes designed to balance parental leave entitlements are still working to increase take-up. We are committed to looking at what the barriers are, and why people are not taking up such schemes.

The Government has developed an online tool to help parents plan Shared Parental Leave and Pay which was launched on gov.uk in June 2021. This helps parents to understand their entitlements and facilitate discussions with employers, thereby encouraging more new parents to use the scheme. Feedback on the tool has been very positive.

13. We note that many parents are disincentivised at work from having children, at a time when the country needs more young people to work and pay taxes to cover the costs of our ageing population. We therefore ask the Government to consult on what more can be done to create the conditions to incentivise parents to have children whilst offering suitable protections at work so that time out of work does not impact their career and pay opportunities in the future. (Paragraph 109)

In the Government’s Spring Budget, the Chancellor announced transformative reforms to childcare for parents, children, the economy, and women.

By 2027–28, this Government will expect to be spending in excess of £8bn every year on free hours and early education, helping working families with their childcare costs. This represents the single biggest investment in childcare in England ever. Childcare is a vital enabler for parents to work. And measures announced aim to support parents to return and stay in work.

Government is seeking to close the gap between parental leave ending and the current childcare offer for working parents. Government will be expanding the free childcare offer so that eligible working parents in England will be able to access 30 hours of free childcare per week for 38 weeks per year from when their child is 9 months old to when they start school.

From April 2024, working parents of two-year-olds can access 15 hours of free childcare per week (38 weeks a year), from September 2024 this will be extended to parents of nine month to three-year-olds, and from September 2025 working parents of nine month to three-year-olds will be able to access 30 free hours per week (38 weeks a year).

The Government is committed to building an economy that works for everyone, including parents. On Wednesday 24 May, three new Government backed Private Members’ Bills received royal assent. As a result, parents and carers will benefit from the following new protections once in force:

  • Up to 12 weeks of paid neonatal care leave for employed parents whose children are admitted to neonatal care, so that they can spend more time with their baby at what is a hugely stressful time. This is in addition to other leave and pay entitlements such as maternity and paternity.
  • Redundancy protection for pregnant women and new parents with the extension of existing redundancy protections to cover pregnancy and a period of time after parents return to work
  • Supporting unpaid carers through a new entitlement to a week of flexible unpaid leave a year, for employees who are caring for a dependant with a long-term care need. This will enable carers to better balance their caring and work responsibilities, supporting them to remain in employment.

These Government backed Acts will boost support to vulnerable workers, and to parents.

14. We conclude that the outdated legal construction of work—namely full or part-time work—is preventing many people who wish to be economically active from being so. For many workers who do work more flexibly, or on a freelance basis, they are not afforded the rights and protections that full or part-time workers receive. We call on the Government to reconsider the need for an Employment Bill in the upcoming King’s Speech so that legislation can be brought forward to, among other things, create new, more flexible constructions of work that include appropriate rights and protections for workers. (Paragraph 122)

The UK has one of the best workers’ rights records in the world. The 2019 manifesto pledged changes to enhance workers’ rights and support people to stay in work. We recognise that greater access to flexible working is often cited as a leading reason individuals would return to or stay in work. As part of the government’s wider package on workforce participation, we are taking forward legislation to provide all employees with a right to request flexible working for day one of employment. Additionally, the Employment Relations (Flexible Working) Bill, which the government is supporting through Parliament, will provide easier access to flexible working by increasing the number of requests an employee can make per year and speed up the process by which employers must respond.

An individual’s employment rights are determined by their employment status, not the type of employment contract they have (for example, a zero-hours, full time, or part time contract); an individual’s employment status is in turn based on the reality of the working relationship between an individual and the person for whom services are provided. In the UK, there are three employment statuses:

  • Employees are entitled to all rights (subject to qualifying periods) and have responsibilities towards their employer.
  • So-called limb (b) workers are entitled to core employment rights such as holiday pay and a minimum wage but have increased flexibility.
  • Self-employed individuals generally have no employment rights but have complete flexibility in their work and are in business for themselves and providing a service to a client.

Our labour market is performing strongly with high employment and low unemployment and the Government’s three-tiered employment status framework strikes the right balance between the flexibility our economy needs and worker protections. In particular, the limb (b) worker status allows flexibility whilst ensuring individuals have core protections such as the right to a minimum wage and holiday pay.

The Government recognises that determining an individual’s employment status is not always straightforward. As a result, in July 2022, we published new guidance on employment status and employment rights. This provides additional clarity for both businesses and individuals so that they have a better understanding of which employment status for employment rights they fall into, supporting individuals to have informed discussions with their employer and empowering them to take steps to claim employment rights and have them enforced where necessary.

15. We also agree with the Joseph Rowntree Foundation that policy solutions are required to ensure more, good-quality flexible job opportunities are available for workers on low pay. We note the Government’s support for the Workers (Predictable Terms and Conditions) Bill, but we recommend that the Government extend the provisions of that private Members’ bill so that there is a:

i) default right to a secure contract after 26 weeks of work;

ii) right to four weeks’ notice of working schedules; and

iii) right to compensation for cancelled shifts (Paragraph 123)

As noted in the Committee’s report, the Government is supporting the Workers (Predictable Terms and Conditions) Bill, which will give individuals on atypical contracts, especially those on zero hours contracts, the right to request a more predictable working pattern. The new right will allow a qualifying worker to make an application to change their existing working pattern if it lacks predictability in terms of the hours they are required to work, the times they are required to work, or if it is a fixed term contract of less than 12 months.

This new right will redress the imbalance of power between employers and workers in atypical work, empowering and encouraging workers to begin conversations with their employers about their contracts, while allowing workers to continue working varied hours if they wish to do so.

Zero hours contracts are an important part of the UK’s flexible labour market, for both employers where there is not a constant demand for staff, and for individuals who may need to balance work around other commitments such as childcare and study. Around 3% of workers in the UK workforce are on a zero hours contract and for many of these individuals this may be the kind of flexibility they want.

The new right will be a right to request and not a right to have, to ensure that businesses are not unfairly burdened by it (for example if the costs of providing a worker with a more predictable working pattern would be too burdensome). The Bill includes a list of specific statutory grounds on which an employer may decline a request, similar to those established for the existing right to request flexible working.

The Government previously held a consultation inviting views on policies which aim to tackle some of the challenges associated with non-guaranteed hours. These included proposals on providing reasonable notice of shifts and providing compensation for shifts cancelled at short notice. We are analysing these results and will respond in due course.

16. The actions of unscrupulous umbrella companies are depriving workers of rights and in some cases remuneration, and they are damaging the reputation of umbrella companies as a whole. There is widespread agreement that the Government should act to provide statutory protection from such practices. In response to this Report, the Government should set out its plans for doing so, or should explain what obstacles are preventing it from doing so. (Paragraph 127)

Umbrella companies are increasingly common in the recruitment sector but are not currently defined in law and are generally unregulated, unless their other activities bring them in scope of the existing legislation that applies specifically to employment agencies and employment businesses.

The Government is committed to increasing transparency and protection for agency workers, including those employed by an umbrella company. It therefore carried out a Call for Evidence on the umbrella company market between November 2021 and February 2022 to gather evidence to inform development of potential policy responses.

The Financial Secretary to the Treasury issued a written ministerial statement on Tax Administration and Maintenance (TAM) Day on 27 April 2023 setting out that the Government would shortly publish a summary of responses to the 2021 Call for Evidence alongside a policy consultation on options to regulate umbrella companies and to tackle non-compliance in the umbrella company market. The full statement is available here- https://questions-statements.parliament.uk/written-statements/detail/2023–04–27/hcws749.

On 6 June 2023, the government published the response to the Call for Evidence and the policy consultation. They are both available on gov.uk at the following links: https://www.gov.uk/government/consultations/call-for-evidence-umbrella-company-market and https://www.gov.uk/government/consultations/tackling-non-compliance-in-the-umbrella-company-market. Minister Hollinrake also wrote to the chair of the Business and Trade Committee to draw their attention to the consultation given the parliamentary interest in this topic.

The consultation (which will remain open until 29 August) proposes options to regulate umbrella companies and tackle tax non-compliance. The options put forward aim to address the issues that workers reported (including through the Call for Evidence), ensure a level playing field by making sure competition in the market is genuine and protect taxpayers and the exchequer.

17. We believe that the Government should take more of a lead in providing protection for workers from any damaging effects from night-time working. As a first step, we recommend that the Government should commission an investigation into the health and safety implications of night-time working. (Paragraph 130)

Under the Health and Safety at Work etc. Act 19748 all employers have a duty, so far as it is reasonably practicable, to protect the health, safety, and welfare at work of all their employees.

Specifically, the Management of Health and Safety at Work Regulations 19999 require employers to assess the health and safety risks to employees, to which they are exposed whilst they are at work, and to put in place arrangements to control those risks. This includes providing employees with information about the risks of any work they carry out and ensuring they are provided with instruction and training in how to deal with those risks. Health and safety legislation therefore extends to ensuring the health and safety of nightshift workers.

The Health and Safety Executive have published guidance for employers to support them in managing the health and safety of shift workers (Managing shift work [HSG 256]10) and Hints and tips for shift-workers (hse.gov.uk)11 to improve sleep quality, increase alertness and reduce health risk.

18. We are not wholly persuaded that there is currently a need for immediate action to establish a statutory “right to disconnect”. But the Government should ensure that mechanisms and processes are in place to detect any significant threat to home workers from unreasonable expectations by employers of availability for work. The Government should also track “right to disconnect” initiatives in Canada and Ireland and elsewhere, to assess their value and effectiveness. (Paragraph 135)

The Government agrees on the importance of ensuring that people have the time they need for their lives outside of work. The Government’s Flexible Working Taskforce—which comprises business groups, unions, and others—has produced advice on what constitutes good practice when considering this issue in the context of home and hybrid working. This was published independently by members in December 2021 and is accessible on the CIPD website.

19. We ask the Government to update the Committee on the status of each of the commitments made by the then Secretary for Transport, Rt Hon. Grant Shapps MP:

  • HMRC to dedicate significant resource to check that all UK ferry operators are compliant with the national minimum wage;

HMRC do not hesitate to use their powers if they suspect a business isn’t paying their workers at least the correct rate of National Minimum Wage. HMRC deploy resource across all sectors proportionate to the level of risk and work with employers to understand their responsibilities and workers to understand their rights and routes of redress.

  • Maritime and Coastguard Agency to review its enforcement policies; and

In response to P&O Ferries’ decision to dismiss 800 seafarers without consultation or notice, the Government published a 9 Point Plan12 for seafarer protections. Point 5 relates specifically to the Maritime and Coastguard Agency role in enforcement and the Agency continues its robust enforcement policies.

The Seafarers’ Wages Bill is a key strand in the Government’s 9 Point Plan and is an important step among a suite of measures to improve seafarer protections and welfare.

The Bill specifically has three core benefits:

  • Seafarers with close ties to the UK who work aboard services in scope of the Bill, who do not qualify for UK National Minimum Wage, will receive fair pay. These are referred to as ‘non-qualifying seafarers’ in the Bill;
  • The Bill will disincentivise a race to the bottom in employment standards amongst operators; and
  • The Bill will protect the reputation of the UK maritime sector following the disgraceful actions of P&O.

Consistent with our international obligations, we are legislating only in relation to “UK work” which means work carried out in the UK or its territorial waters.

The compliance process will involve harbour authorities, the Maritime and Coastguard Agency, and the Secretary of State for Transport. The Maritime and Coastguard Agency will play an enforcement role in checking the validity of declarations through spot checks and investigating non-compliance carried out on a proportionate basis. They will pursue prosecutions under the offences in the Act where necessary (this role would be played by the Lord Advocate in Scotland).

  • Action to prevent employers who have not made reasonable efforts to reach agreement through consultation, from using fire and rehire tactics. (Paragraph 141)

The Government continues to take action to deter companies from malpractice. This includes taking action to address the practice of dismissal and re-engagement, also known as ‘fire and rehire’. We published a draft statutory code of practice for consultation in January and are currently analysing responses.

The Code sets out employers’ responsibilities when seeking to change contractual terms and conditions of employment and seeks to ensure dismissal and re-engagement is only used as a last resort. Once in force, an Employment Tribunal will be able to increase an employee’s compensation in certain circumstances by up to 25% if an employer has unreasonably failed to comply with the Code.

20. We conclude that enforcement of labour market rules is wholly inadequate—not because enforcers or regulators are not performing, but because they are under-resourced and not given the priority they deserve for legislative reform. (Paragraph 147)

The Government does not agree with the Committee’s characterisation of enforcement. In 2021/22, for example, HMRC concluded over 2,800 minimum wage investigations and returned more than £16.3m in arrears to over 120,000 workers, further issuing 696 fines totalling £13.2m to business who had failed to pay the minimum wage. The Government continues to increase investment in state enforcement bodies, more than doubling the budget for National Minimum Wage compliance and enforcement to £27.8m for 2022/23, up from £13.2m in 2015/16.

Elsewhere, the Government has taken steps, including recruitment of judges, to return Employment Tribunals to pre-Covid levels of hearings. MoJ and DBT are continuing to work together to improve the efficiency of the employment dispute system.

These investments are on top of c.£50m the Government provided last year for the Advice, Conciliation and Arbitration Service (Acas). Acas is an impartial independent organisation whose remit is to promote good employment relations, advise employers and employees on workplace matters, and resolve individual and collective workplace disputes.

The UK has a robust system for enforcing employment rights and the number of enforcement officers is just one aspect. The Government recognises the importance that effective and swift resolution of employment disputes plays in protecting the rights of workers.

21. We believe that the Government should proceed with the establishment of a single enforcement body, bringing together the Employment Agency Standards Inspectorate, the Gangmasters and Labour Abuse Authority and the National Minimum Wage Team. We believe that a single organisation would provide clarity for those most in need and would offer benefits in sharing of information. (Paragraph 148);

22. We call on the Government to commit to a long-term financial plan with the new single enforcement body (or existing bodies if it declines the opportunity to create a single enforcement body) to ensure that it is resourced to at least the minimum level of what is deemed appropriate by the International Labour Organisation. (Paragraph 151); and

23. We ask the Government to confirm to the Committee the current number of inspectors employed in the Employment Agency Standards Inspectorate, the Gangmasters and Labour Abuse Authority and the National Minimum Wage Team within His Majesty’s Revenue and Customs. (Paragraph 152)

This Government remains wholly committed to workers’ rights and enforcement. However, we need to be realistic about what we can achieve given the limits on parliamentary time. We are reviewing what this means for the creation of the Single Enforcement Body which would be a substantial organisational change.

In the meantime, we continue to invest significantly in the existing labour market enforcement bodies,and are working with the Director of Labour Market Enforcement to ensure that they are supported to work together as effectively as possible.

The Government remains committed to the enforcement of workers’ rights. Over the decade from 2010 to 2020 the UK funding to the labour market enforcement bodies (HMRC’s National Minimum Wage Team, Employment Agency Standards Inspectorate and Gangmasters Labour Abuse Authority) has increased to over £35 Million representing a 121% increase. As of May 2023, there are approximately 400 HMRC staff involved in the enforcement of the minimum wage. The GLAA currently have 56 enforcement officers and EAS have 36 FTE posts which have front line inspection capacity.

24. While employment tribunals are backlogged, and awards are not being paid, workers are being prevented from exercising their rights effectively. We commend the Government for providing resources specifically to help clear the backlog. In the meantime, we ask the Ministry of Justice to set out an action plan on clearing the backlog and on its plans for resourcing enforcement, to be published within the next six months. The Government should also justify why it has not so far taken action to extend the time limit for submitting certain types of employment tribunal claims from three months to six months. (Paragraph 157)

The Government recognises the importance that effective and swift resolution of employment disputes plays in protecting the rights of workers and has introduced a number of measures in the Employment Tribunal to help address outstanding caseload, maximise capacity and efficiency and help respond to growing demand. The Ministry of Justice has maximised judicial capacity by deploying legal caseworkers to handle non-contentious administrative case management work. It has recently recruited up to 35 new salaried judges in the Employment Tribunal in addition to the 19 new salaried and 114 fee-paid judges appointed in 21/22. MoJ has maximised the capacity of existing courtrooms by making our estate Covid-secure for hearings that cannot be dealt with virtually, deployed our Cloud Video Platform and recruited additional video hearing administrator staff to ensure we can hear as many cases remotely as possible. The judiciary have established a ‘Virtual Region’ of fee-paid judges to hear cases in any region, which has already delivered 1,900 sitting days and heard over 1,000 cases by December 2022.

As a result of these measures, the Employment Tribunals have now succeeded in returning to pre-Covid levels of hearings. However, we recognise that significant challenges remain. The Government is working on further measures to increase capacity, reduce demand and improve the efficiency of the whole employment dispute system. Measures introduced to date have focused on increasing mediation capacity, establishing a specialist team of conciliators to deal with the most complex cases, and improving our early education offer for businesses.

The Government will take a whole system approach to addressing the outstanding caseload in the Employment Tribunal. One example is a recent project led jointly by MoJ and DBT funded by the Shared Outcome Fund and delivered by Acas. It has looked at ways in which early interventions can improve the service offered to customers by Acas, to resolve employment disputes more quickly and effectively. Evaluation of the work is ongoing; however, early indications are positive, with users feeling more informed and more cases being resolved without the need for them to progress into the Employment Tribunal Services.

The funding award has enabled:

  • The development of a new content strategy, which helps those using Early Conciliation claimants to better understand the process;
  • The creation of a new notification form: this supports users in providing the information needed to allow Acas to act quickly and maximise the time available to see if a resolution is possible;
  • The deployment of automated allocation using data from the new form, which allows the user (or their representative) to be matched with a conciliator in a matter of minutes; and
  • Changes to the large group claims strategy, which means that users who are from the same workplace are assigned to the same conciliator.

A further system-wide change involves the Judicial Review and Courts Act, which will transfer Employment Tribunal rule-making powers to the Tribunal Procedures Committee, an independent, judge-led committee. This will help the Tribunal to respond more swiftly and flexibly to the challenges it faces through operational changes and rulemaking. It will also allow the judiciary to manage their workloads more flexibly and help maximise the capacity of the Employment Tribunal.

The Government also recognise the vital role that effective enforcement plays in giving individuals the confidence to challenge employers where they are denied their rights and it creates a level playing field between businesses. An individual’s employment right to take their employer to a Tribunal remains an individual right and thus it is their right to enforce in a manner that best suits their individual need(s). Successful claimants are signposted to the High Court Enforcement Fast Track Scheme which allows High Court Enforcement Officers to apply for and seek to execute writs of control on behalf of the successful claimant. The scheme is widely used by claimants.

25. If the Retained EU Law (Revocation and Reform) Bill receives Royal Assent, a substantial body of regulations contained within EU retained law and covering employment standards and rights will cease to apply in the UK unless specifically preserved in some form. Great care will need to be taken in reviewing these regulations and determining how they should each be treated, to ensure that there is clarity and consistency in UK labour law. (Paragraph 160);

26. We recommend that the Bill should be amended to ensure that within a given timeframe a committee also examines any regulations which are part of retained EU law and which govern UK law relating to work, including workplace standards and employment rights, which the Government (a) intends should expire at the ‘sunset’ date set in the legislation or (b) proposes to incorporate into domestic law under the affirmative procedure. (Paragraph 161);

27. To facilitate this scrutiny the Bill should ensure that the Government must present to the committee a notice of any provision which it intends should expire, together with a memorandum of its reasons and an impact assessment in time to allow consideration before sunset. Where the Government intends to incorporate a provision into UK domestic law under the affirmative procedure it should present a draft of the proposed instrument to the committee, together with a memorandum of its reasons for any decision to adapt or amend the regulations and/or for any decision by the Government not to preserve any element of them. In each case that committee should:

  • provide the Government with an opportunity to give such further explanations of its proposal as the committee may require, except where the committee does not consider it reasonably practicable to do so within the statutory timeframe;
  • report on the notice or draft instrument and accompanying papers, drawing to the attention of the House any observations or concerns arising from its consideration of such documents; and
  • have the power to recommend any notice or draft instrument for debate on the floor of the House: if rejecting this recommendation, the Government should be required to make a statement explaining its reasons; and

The Government must ensure that the flow of notices and proposed instruments to any relevant committee is controlled and consistent, so that the committee has a reasonable opportunity for effective examination of each proposal within the statutory timeframe. (Paragraph 162)

The Government introduced the Retained EU Law (REUL) Bill so that we could end the special status of retained EU law. The Government tabled an amendment at Lords Report stage of the Bill, which replaces the current sunset in the Bill with a list of the retained EU laws that we intend to revoke at the end of 2023. This provides certainty by making it clear which regulations will be removed from the statue book. We will retain the vitally important powers in the Bill that allow us to continue to amend EU laws, so more complex regulation can still be revoked or reformed after proper assessment and consultation.

We have identified several regulations where we see opportunities for improvements in retained EU employment law following our exit from the EU, including the Working Time Regulations and Transfer of Undertakings (Protection of Employment), or ‘TUPE’, Regulations.

We are consulting on proposals to reduce time-consuming reporting requirements under the Working Time Regulations, which could save employers around £1bn a year. We are also consulting on simplifying annual leave and holiday pay calculations in the Working Time Regulations, and streamlining regulations that apply when a business transfers to a new owner.

These proposals do not seek to remove rights, but instead remove unnecessary bureaucracy in the way those rights operate, allowing business to benefit from the additional freedoms we have through Brexit.

The Government has been clear throughout the Brexit process that we have no intention of reducing the substantive legal protections for workers.

To make good on this promise, we have also made clear in the consultation the areas of employment law where the Government will not make any changes, including the system of maternity, paternity, adoption, or parental leave.

The impact of an ageing population on the labour market

28. We endorse and support the recommendation by the Women and Equalities Committee that the Government should develop and pilot a specific ‘menopause leave’ policy with a large public sector employer. (Paragraph 189)

The Government notes the Committee’s support for the Women and Equalities Committee recommendation that the Government should develop and pilot a specific menopause leave policy with a large public sector employer.

As we said in response to that report, the Government does not believe that introducing or piloting a specific policy for menopause leave is necessary. Each woman’s experience of the menopause is different, and it is important that employers listen to the individual and agree what works best for them. For some women, time away from work may be an appropriate step for an employer to take. For others there will be other measures which will be more helpful—the opportunity to work from home, to move to a cooler part of the office, or to wear a more comfortable uniform, for instance.

29. We welcome the Government’s support for the Employment Relations (Flexible Working) Bill, we reiterate what we have said earlier in this report that a right to request flexible working is a right to decline. We urge more employers to specify, when advertising job vacancies, that a role may be suitable for flexible working: by doing so, they stand to benefit from a huge untapped pool of older workers. (Paragraph 197)

The Government welcomes the Committee’s acknowledgement of our support for the Employment Relations (Flexible Working) Bill. We recognise the benefits flexible working can bring and we are committed to supporting individuals and businesses to find flexible work arrangements that work for both sides. That is why, alongside the Bill, we also intend, through regulations, to make the right to request flexible working apply from the first day of employment.

The right to request flexible working is not a “right to decline”. Under the current legislation an employer is obliged to accept a flexible working request unless there are good business reasons for rejecting it. There are many types of flexibility that can help employees manage their lives and flexibility is not simply the ability to work from home. Not all types of flexible working are available in all jobs—for example, working from home is not an option for most nurses. It is right that employer can turn down particular flexible working arrangements where they are impractical.

The Government welcomes the fact that the Committee has taken the opportunity to encourage employers to specify, when advertising job vacancies, that a role may be suitable for flexible working. Research conducted by the Behavioural Insights Team has shown that offering flexible working can attract up to 30% more applicants to job vacancies13 In 2019, we consulted on whether employers should be required to do this. The consultation suggested that a legislative requirement would likely drive the wrong response from those employers we were most looking to influence—those not culturally ready would simply default to “no”. The Government will therefore continue to encourage employers to advertise jobs flexibly on a voluntary basis, where this reflects a genuine offer of flexibility. The Government will continue to promote this business case in collaboration with stakeholders on the Flexible Working Taskforce.

The Civil Service leads by example in this area by encouraging flexible working and offering a range of flexible working options as part of the total reward package.

30. We recommend that the Government conducts a review into the future reform of jobcentres and to assess whether a public employment service offers better solutions in alternative settings (as well as online) that will improve the accessibility and quality of employment advice for people over 50. (Paragraph 203); and

31. It is clear that to succeed in retaining or re-integrating people aged over 50 in the workforce, there needs to be a better understanding of what that age cohort wants from work. We recommend that the Government considers a dedicated resource, similar to the silver human resource centres in Japan, as part of a national jobs service to support older people to find relevant opportunities. This could, for example, be administered out of jobcentres. (Paragraph 204)

The Department for Work and Pensions have established a project to update our labour market evidence base to better understand the impact of changes to the way Jobcentre services are delivered.

DWP are actively looking at how to move more services online to deliver the ambition of more integration, where customers receive optimised services based on their individual need. This work looks at alternative delivery methods for the conditionality regime, including testing alternative channels (e.g. digital, telephone and video), frequency, duration of meetings and options for claimant segmentation.

The Government already has an extensive offer to help workers aged 50 and over to stay in, progress, and return to work. DWP’s 50PLUS Choices offer includes:

  • Intensive tailored support for eligible UC job seekers during the first 9 months of their claim. This gives Work Coaches more time to spend with older job seekers who have recently become unemployed and to tackle any barriers or difficulties in finding work. Alongside this, Work Coaches can offer all claimants additional opportunities of support through Restart, Sector-Based Work Academy Programme placements (SWAPS), the Flexible Support Fund, Mentoring Circles, and 50+Job Fairs;
  • A network of 37 full-time 50PLUS Champions in every Jobcentre Plus District across Great Britain. The Champions collaborate with Work Coaches, employers, and stakeholders to raise awareness of the importance of supporting older jobseekers and any barriers that they may have. They also engage with employers and stakeholders to raise awareness of the barriers which older people may face in accessing work;
  • Midlife MOTs to support people in their 40s and 50s who are both in and out of work, to review and take stock of their finances, skills and health;
  • Announced at Budget 2023, Returnerships are a targeted support offer for adults over the age of 50 who are returning to work or seeking a career change, by bringing together Apprenticeships, Skills Bootcamps and Sector Based Work Academy Programmes (SWAPs). Jobcentre Plus will raise awareness of these pathways via our Work Coach, employer adviser and 50+ champion communities, enabling delivery of clear routes back into work and encouraging employers to hire older workers.
  • We recognise the key role that employers have in helping older people to stay in and return to work, and in embracing attitudes and policies conducive to this support. DWP regularly monitors and evaluates the effectiveness of our provision, including Jobcentres, to ensure that it is delivering according to our priority outcomes;
  • The Government appointed Business Champion for Older Workers—Andy Briggs, CEO of the Phoenix Group—to spearhead work to promote the benefits of older workers and multigenerational workforces to employers across England, influencing employers both strategically and in terms of practical advice; and
  • Alongside this Helen Tomlinson has been appointed as the first ever Menopause Employment Champion and will drive awareness of issues surrounding menopause and work while promoting the benefits for businesses and the economy when women are supported to stay in work and progress.

In addition to this, the Government-supported Private Members Bills noted throughout the Report will contribute to supporting, retaining and re-integrating many over 50s in the workforce.

32. We welcome the expansion of the mid-life MOT. We agree that it is important that people in their 40s and 50s should get a reality check on their finances and health to help them make better-informed decisions about their next steps in work and prepare for retirement. We ask the Government to consider a similar scheme for people starting work, not least to highlight the importance of pension auto-enrolment. (Paragraph 209)

Since its introduction, Automatic Enrolment has transformed workplace pension saving with participation amongst eligible employees in the private sector increasing from 42% in 2012 to 86% in 2021. It was designed specifically to help groups who historically have been poorly or less well served by the pensions market, including young people. In 2012, 24% of eligible employees in the private sector aged 22 to 29 were participating in a workplace pension. As of 2021, this increased to 85%, a 61-percentage point increase.

The Government’s ambition is to enable 18-to 21-year-olds to start building a pension from their first day in work and to give lower earners greater opportunity to build retirement savings through implementation of the 2017 Automatic Enrolment Review measures. This is why we are supporting Jonathan Gullis MP’s Private Members’ Bill, which presents an immediate route for the legislative powers to expand the AE framework in the current Parliamentary session. The bill has passed through the House of Commons and was introduced in the House of Lords on 27 March.

33. If returnerships are to attract older workers and to be effective in bringing them back into the workforce, they will need to offer a decent package of training. They will need to value and recognise the skills that older workers already bring to their new workplace, while seeking to provide practical reskilling. To be effective:

a) There should be transparency on whether there will be a job at the end, and what that job will be;

b) Organisations should be incentivised in some way, or they may question what is in it for them. Paying less National Insurance, for example on a worker they hire through such a scheme could be one such incentive;

c) They should offer flexible working options: people in their 50s value part-time and flexible working patterns and are more likely to take up a returnership and a job at the end of it if flexible working is available in the role;

d) The training needs to be sector-based, rather than jobs-based, featuring opportunities to shadow and learn about different roles. This would give people on the scheme the chance to learn about different roles within a sector and not narrow their choice to a specific job at the outset;

e) It should include regular careers support and counselling;

f) Schemes should be cohort-based, enabling people to train with their own peer group; and

g) The scheme, once it is up and running, should showcase examples of people who have joined the programme and successfully re-trained and entered a new role. (Paragraph 213)

Returnerships are targeted at adults over the age of 50 who are returning to work or seeking a career change by bringing together apprenticeships, skills bootcamps and sector-based work academies (SWAPs), and will raise awareness of these pathways, providing a clear route back into work and encouraging employers to hire older workers.

There are lots of ways older workers can benefit from returnerships to flexibly access apprenticeships. We will be promoting the availability of ‘accelerated apprenticeships’, which can support workers to complete their apprenticeship more quickly if they are progressing from other pathways like skills bootcamps, or where they have already gained relevant skills and experience earlier in their careers. We offer flexible front-loaded training that is appealing to older workers re-entering the workforce. Apprenticeships can also be undertaken part-time, with agreement from the employer, with the typical duration extended to reflect this.

Skills Bootcamps were introduced at the end of 2020 to deliver short, free, flexible training courses for priority sectors with skills shortages and high growth sectors. They are available to adults aged 19 and over, giving people the opportunity to build up sector-specific skills, with an offer of a job interview with an employer on completion.

The Budget has announced £34 million of additional funding in 2024–25 for Skills Bootcamps. The additional funding builds on the £550 million to expand Skills Bootcamps from FY2022–25 and will provide up to another 8,000 places for adult learners, bringing total skills bootcamp places to 64,000 by 2024–25. We expect this to include roughly 1,000 Skills Bootcamp training places for the over-50s starts, based on current participation rates by age.

Sector alignment

DfE’s Skills for Jobs reform programme is putting employers at the heart of our skills system by aligning our training offers to employer-led standards and therefore strengthening routes into jobs the economy needs in key sectors such as engineering, digital, and clean energy.

Our engagement with employers is sector-aligned to ensure a strong link between education and jobs. For example, T Level Panels draw on the experience of employers, professionals, and practitioners from relevant sectors to inform the design of T Levels.

Comms and engagement

Returnerships are being promoted as part of the Skills for Life campaign and by DWP Work Coaches in their support to over 50 claimants. The next burst will be live in June 2023 and will direct adults to further information at Unlock your potential – Skills for Life: https://skillsforlife.campaign.gov.uk/

Careers advice and guidance

The National Careers Service provides free, up to date, impartial information, advice and guidance on careers, skills and the Labour Market in England. Professionally qualified careers advisers support customers to ensure that they are:

  • informed and aware of the wide range of learning and work opportunities that are available to them;
  • better able to independently manage their careers; identify opportunities and respond to challenges in the employment and training market; and
  • are aware of and able to access accurate and up to date information about careers and learning from the National Careers Service whenever they need it.

The Service helps customers make informed choices about their career options, whatever their age, ethnic group, and background. Discussions are tailored to meet the individual needs and circumstances of each customer.

Adults aged 50 and over who are unemployed, or a risk of redundancy are one of the priority groups for the National Careers Service.

National Careers Service employer engagement leads play a crucial role in disseminating labour market information, sharing best practice and intelligence with each other and with careers advisers, as well as engaging with key local stakeholders.

The National Careers Service works with industry sectors to disseminate key information and updates via bulletins and newsletters to careers advisers in the community. They can also facilitate webinars and Q&A sessions to help careers specialists keep up with developments—this is a partnership as it requires input from industry to ensure that content is accurate and up to date.

34. We recommend that Government departments, and the wider public sector, lead from the front on the returnership initiative. Offering returnerships in the Civil Service, in the NHS and in education, for example, will give the private sector confidence that it is a successful model worth the financial investment. (Paragraph 214)

Apprenticeships can support older workers to start or progress their careers in the public sector, whether through reskilling or upskilling, and can support the sector to build a diverse pipeline of talent to meet emerging skills needs. We have seen year on year increases in the number of apprentices hired within the public sector, with some sectors putting an increased focus on the use of apprenticeships as their main entry route. Employers, including the Civil Service and wider public sector, such as NHS employers, have developed a range of apprenticeships to meet their needs including registered nurse, teacher, police constable, operational firefighter and public service operational delivery officer. We continue to work with public sector employers to ensure they can benefit from the high-quality and flexible training that apprenticeships provide.

Skills Bootcamps are focused on delivering the skills that employers need in order to fill skills vacancies in key sectors (e.g. digital, construction, HGV driving and skills that support the Green economy). Departments including BEIS, DCMS, DfT and DWP, employers, and FE providers are working to identify skills needs that are a good fit for the Skills Bootcamps delivery model (i.e. good wage outcomes and in-demand skilled vacancies), this includes some roles that are in the public sector.

35. We consider that such a process could be valuable for workers of all ages and that a review is conducted one year following implementation of returnerships to evaluate their benefit more widely. (Paragraph 215)

The Government is promoting returnerships pathways (SWAPS, skills bootcamps and apprenticeships) through the DfE’s Skills for Life campaign and through Jobcentre Plus communications channels to increase awareness of these options amongst the over 50s.

When engaging with 50+ claimants, Work Coaches will consider the suitability of referral to Returnerships provision as part of the employment and skills assessment (triage) offered to all claimants, referring those who would benefit from this help to locally available provision support. By providing additional funding and highlighting this as an offer to people currently out of work, the government is taking steps to drive down inactivity and boost our economy.

We will continue to monitor the uptake of apprenticeships and related programmes, including by those aged over 50. Levels of apprenticeship starts are subject to demand by employers who decide which apprenticeships they offer and when, as well as individuals choosing to apply for apprenticeship vacancies which are open to people of all ages and backgrounds.


Footnotes

1 https://ico.org.uk/for-organisations/guide-to-data-protection/guide-to-the-general-data-protection-regulation-gdpr/principles/accountability-principle/

2 Full list of social tariffs currently available - Ofcom

3 https://www.postofficehorizoninquiry.org.uk/

4 https://www.gov.uk/guidance/rules-and-practice-directions-2020

5 https://www.lawcom.gov.uk/14th-programme-kite-flying-document/#ProceduralEfficiency

6 https://ico.org.uk/media/about-the-ico/consultations/4021868/draft-monitoring-at-work-20221011.pdf

7 Pregnancy and Maternity Discrimination Advisory Board members: Equality and Human Rights Commission; Fawcett Society; Pregnant then Screwed; TUC; Working Families; British Chambers of Commerce; (CBI); Federation of Small Business; Institute of Directors; MAKE UK; Government Equalities Office

8 https://www.legislation.gov.uk/ukpga/1974/37/contents

9 https://www.legislation.gov.uk/uksi/1999/3242/contents/made

10 https://www.hse.gov.uk/pubns/priced/hsg256.pdf

11 https://www.hse.gov.uk/humanfactors/topics/shift-workers.htm

12 https://www.gov.uk/government/publications/nine-point-plan-for-seafarers-our-commitments-to-protect-seafarers/nine-point-plan-for-seafarers-our-commitments-to-protect-seafarers

13 Behavioural Insights Team Research https://www.bi.team/blogs/bits-biggest-trial-so-far-encourages-more-flexible-jobs-and-applications/