Annual Conference Souvenir Supplement

responsibilities. ● Employee voice; particularly informed employees who can contribute to decisions and are listened to. ● Relationships based on trust, with employers sharing information at the earliest opportunity. ● Employees who feel valued and treated fairly. I won’t go into all these now, but for those of you interested more information can be found on the ACAS website ( www.acas. org.uk ). I do, however, want to say a bit more about fairness in the workplace and its relationship to pay. ● Fair pay and government intervention – One of the key aspects of workplace fairness is fair pay. What is and isn’t fair pay has been much in the news of late. Indeed, so topical has the subject become that even the government have been stirred into action which, given the general reluctance of Conservative governments to intervene in the workplace, is somewhat unusual. Earlier this year the government introduced new legislation in direct response to the growing concerns over the gender pay gap. Although it is true that the gender pay gap has been shrinking the pace is positively glacial. At 9.4% in 2016 the difference between average pay for male and female full-time employees was little changed from the 10.5% gap five years earlier. At this rate some have estimated that it will take until 2069 to eradicate the pay gap. To help speed things along there is now a statutory requirement on all employers with more than 250 employees to collect and publish data on their gender pay gap, gender bonus gap and provide a breakdown of how many men and women get a bonus. Of course, this is only a small step and there are no rules about what bosses should do where pay gaps are revealed. However, I think it is safe to assume that no one is going to want to be top of the gender pay inequality rankings. Ultimately time will tell how successful the new gender pay reporting is but I certainly hope it will encourage employers: to be honest in examining the opportunities for women and address any barriers that exist; to be imaginative and positive in looking for solutions; to scrutinise the processes which unwittingly deter some women from promotion; to review the support they give to women on maternity leave, women returners, staff with elderly care responsibilities and to single parents; and to challenge the current orthodoxy about how things work. It is not just in relation to gender pay though that the government has shown itself to be sensitive to the concerns of the public at large. It has also responded to the concern expressed by people about the growing divide between the rewards going to workers and those going to top executives. In their recent response to the green paper consultation on corporate governance the government announced that they would be introducing secondary legislation to require quoted companies to report annually on the ratio of CEO pay to the average of their UK workforce along with a narrative explaining changes to the ratio from year to year and how the ratio relates to pay and conditions across the wider workforce. More details on how this will work are due to be published later this year. ● Public sector pay – The government’s concern about pay and the squeeze it has been putting on living standards has also extended to its approach to pay in the public sector. For some years now, the government have been sticking to a 1%

pay limit in the public sector but earlier this month the government finally gave way to growing pressure by offering police officers a 2% rise and prison officers a pay increase of 1.7%. They did, however, temper the offer by making clear that the increases would have to be funded from existing budgets. Significantly the increases offered to the police and prison officers whilst above the 1% limit are nevertheless below the current level of inflation as measured by the consumer prices index and consequently were not greeted with the enthusiasm from the trade union movement that perhaps the government had hoped for. I think we can say that feelings are still running high amongst public sector trade unions and we may well be in for some form of industrial action going forward. ● Minimum wages – The latest government interventions in the field of pay whilst somewhat unusual are not the first a government has taken by any means. One of the most significant interventions happened eighteen years ago when the Labour government brought in the statutory national minimum wage. Launched in part as a response to the decline in collective bargaining institutions in the private sector and a consequent collapse of wages and working conditions at the bottom of the labour market, the new national minimum wage was viewed initially with great scepticism. However, over time I think it is fair to say it has come to be considered a great success not least in that it has directly helped to increase the wages of around 5% of the working population. A large reason for this success can be put down to the work of the independent Low Pay Commission which was set up to effectively design and run the national minimum wage. Through rigorous attention to evidence and careful discussion and negotiation amongst the social partners that make up the Commission, the national minimum wage has substantially improved in real value since its launch without having any substantial adverse effects on employment, which was the initial fear. So, by 2015 the national minimum wage had become an accepted feature of the workplace. But in July of that year the Conservative chancellor George Osborne somewhat punctured this relative tranquility with the introduction of what he called a new national living wage. Set at an initial rate of £7.20 an hour the new national living wage represented nearly an 11% increase over the then full rate national minimum wage. The chancellor also announced that it was the government’s intention that the new living wage should be increased to 60% of median earnings by 2020 – an intention that has been reasserted by the current government in the recent Queen’s speech. The impact of the new national living wage has been significant with the number of workers directly affected by minimum wages rising by more than a third from 1.4 to 1.9 million. The bite of the national living wage has increased and in some low paying sectors such as cleaning, hospitality, food processing, hairdressing and retail where it is now as high as 90%. Looking forward, if the government’s commitment for the national living wage is fulfilled, the number of workers it covers is set to rise to three million of some 12% of jobs by 2020; and in some sectors, such as hospitality and cleaning, the bite will rise to close on 100% – in other words the national living wage will in effect become the ‘going rate’ for these sectors. I think it is fair to say that the jury is still out on the national living

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ANNUAL CONFERENCE AND EXHIBITION 2017

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