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Sir Brendan Barber: Workplace predictions for 2015

Thursday 01 January 2015

Acas Chair, Sir Brendan Barber, gives his workplace predictions for 2015.

 

Sir Brendan Barber

Sir Brendan Barber is Acas' Chair, joining in January 2014. Previously Sir Brendan was the TUC General Secretary (2003 to 2012) and sat on the Advisory, Conciliation and Arbitration Service Council (1995 to 2004). Sir Brendan was knighted in the 2013 Birthday Honours for services to employment relations.

Acas Chair Brendan Barber blog

Good relations at work is key to building a solid recovery

Acas' leading role in employment relations means we talk to employers and employees regularly. We also ask academics and researchers to offer us some insights into workplace relations issues. As Chair of Acas, I want to offer some thoughts on the state of employment relations in Britain and what might lie in store for the year ahead, which marks Acas' 40th birthday.

Effects of recession recovery in the workplace

The 2008 recession was out of the ordinary not only for its depth and longevity but also due to the fact that whilst employment has held up remarkably well, there's been a sharp drop in productivity. There's also been a dramatic fall in real wages and a growing recognition that the two are interrelated. Figures released in 2014 by the National Institute of Economic and Social Research show a decline of 8 per cent in real wages between 2008 and 2013 whilst for young people the decline was nearly double that at 14 per cent.

With the economy now beginning to show distinct signs of recovery although unevenly across the country, workers are expecting this good news to be reflected in their pay packets. This is certainly happening in some parts of the private sector but pay has not risen in the same way within the public sector which is inevitably leading to employment relations tensions. Research by the Institute of Fiscal Studies has shown that private sector pay is predicted to rise as much as 4% in 2017 whilst public sector pay is scheduled to be kept to a maximum 1% increase with government forecasts showing another one million public sector posts disappearing by 2019. We have already seen a number of coordinated days of action in the public sector and I believe this looks set to continue in 2015.

Dispute resolution

Resolving disputes is what Acas is best known for and our mediators continue to do an excellent job in resolving disputes. Last year Acas was involved in more than 850 national and regional disputes and assisted employers and unions in a wide range of employment sectors. Fifty-two per cent of the disputes were about pay; 14% were about trade union recognition; and 12% about changes to working practices. This included high profiles cases such as Royal Mail and the London Underground. We helped to achieve a suspension of a second planned 48 hour tube strike that was due to start later in the evening. The Federation of Small Businesses estimated that the first 48 hour strike cost small firms in the capital £600 million in lost working hours, business and productivity. This demonstrates the benefits of Acas to the economy.

The most significant development has been the introduction of fees for bringing an employment tribunal claim. A number of employer bodies and those in support of the principle of charging for bringing a claim were surprised at the levels set for the fees and whilst it is still relatively early days, the data released so far by the Tribunal Service indicates a significant fall in the volume of claims since the introduction of fees.  Figures released by the Tribunal Service showed that the number of single claims received in the period April to June 2014 was 3,792 - 70 per cent fewer than in the same period in 2013. The debate about access to justice will continue.

Another change in 2014 has been the introduction of early conciliation where anyone who wishes to make an employment tribunal claim must notify Acas and we then offer the option of voluntary conciliation to bring about an early settlement. This new free service has been a huge success - we are dealing with around 1600 cases a week and we have dealt with nearly 40,000 cases in the first six months of operation. Our early dispute resolution service will continue to offer a free way for employers and employees to resolve their disputes in 2015.

Zero hours contracts

The Government has run two separate consultations around the use of zero hours contracts in 2014 specifically around transparency, exclusivity clauses and banning these clauses. Our own research shows that many workers on a zero hours contract experience a deep sense of unfairness and mistrust that go beyond the use of exclusivity clauses.

Many workers on these contracts feel afraid of looking for work elsewhere, turning down hours, or questioning their employment rights in case their work is withdrawn or reduced. This deep rooted 'effective exclusivity' can be very damaging to trust and to the employment relationship. There also appeared to be a lack of transparency on the terms of their contractual arrangements. Many people did not seem to even know that they were on a zero hours contract and some believed they were on a permanent contract due to the length of their service.

Evidence from Acas' analysis of calls to our helpline also revealed that some employers could find ways to circumvent the Government's ban on zero hours exclusivity clauses. For example, an employer could reduce or stop offers of work to those who take an additional job. Workers might be discouraged from taking on an additional job because they are concerned that their work opportunities will be reduced if they do. A Joseph Rowntree Foundation report found that in the first half of 2014, there were 1.6 million employees with temporary contracts so it looks like the use of these contracts are set to continue in 2015. That's why we have decided to develop some further guidance for employers and workers in 2015 around the use of zero hours contracts to help tackle the problems relating to lack of awareness and clarity regarding these contracts.

Productivity

So far a solution has not been found to the UK's productivity problem. The latest Office for National Statistics estimates show that UK Labour productivity measured by GDP per hour worked was 9 percentage points below the G7 country average in 2007, but by 2013 it was 19 percentage points behind. This is the biggest gap since 1992.

Previous solutions debated have ranged from improved education and skills levels to easier access to finance and better corporate governance. These may all have relevance but we are still left with a 'productivity puzzle.'

What is often overlooked which I feel will have a big role to play is the workplace itself, through better workplace management and employment relations. Acas has commissioned a series of papers looking at how to improve productivity and more work is planned in 2015.

The workplace so often gets overlooked when the focus is on institutions and policy. One striking finding from the latest survey in the Workplace Employment Relations series (WERS) was that businesses that had established good relations with their workers were less likely to have been damaged by the recession. At Acas we believe that prevention is always better than the cure and it is clear that good relations at work is key to building a solid recovery.

All these issues will no doubt feature strongly in the 2015 general election debate.

1 Comment

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  • Posted by David Majer  |  26 February 2015, 10:57AM

    Hi everybody,

    We have something similar to the idea of zero hours, but it is called 'order' as the wikipedia explains http://en.wikipedia.org/wiki/Order_%28business%29. I have to tell you it doesn't really go that well - the employer gets almost complete control over the employee, how many hours he or she is to work, when and where. Obviously, it does provide certain job positions but in the log run it has a detrimental effect on the job market. Avoid it!

    David from eduranking.pl