During a heated debate in Parliament, yesterday (17th December), the Tory-led Government pushed through measures which take away hard won rights at work in exchange for being offered shares in a company.
Under this new employment status, individuals will lose protection against unfair dismissal, the right to request flexible working and time for training, statutory redundancy pay and will have to give a longer notice period when returning from maternity or adoption leave.
Despite claiming that the scheme will be ‘voluntary’, it is still unclear whether posts will be advertised as being available only under the new status, raising fears that unemployed people would be forced to take a job which sees them lose vital rights at work or stand to lose Jobseekers Allowance.
While ministers initially said the scheme would cost the exchequer £100m, earlier this month the OBR suggested that its cost could spiral to £1 billion.
The Government has said the new employment contract will be introduced in April 2013.
Local MP, Andrew Gwynne who voted against the policy in the House of Commons on Monday has warned of the consequences and is urging local people to be alert in future employment that they could be offered from Spring of next year.
Andrew Gwynne MP said:
“Slashing people’s rights at work is wrong and will doing nothing to help jobs and growth. In fact, it risks making employees feel less secure in their place of work which could knock consumer confidence and the local economy.
“Despite the campaigning of Labour MPs, the rejection of the business community and the thousands of people who signed the petition organised by the trade union movement against the scheme, this out-of-touch Government has pushed this measure through.”
Ian Murray MP, Labour’s Shadow Minister for Employment Relations added:
“This is an ideologically driven policy which is bad not only for employees, but is bad for business as well. When the Chancellor announced this proposal during his Conference speech, he said ‘owners, workers, and the taxman all in it together’. In reality, this measure is divisive, goes against the spirit of “one nation” and risks creating a two-tier labour market.
“We have voiced concerns that this new status will be open to tax avoidance and could leave employees who accept it with large tax liabilities in national insurance and income tax. It would be a crazy situation where people would have to pay to take up a job.
“Labour supports employee ownership but coupling this with slashing employment rights is contradictory and counterproductive.”