Earlier this year the CIPD published a report from the Work Foundation which concluded that there was “no overall advantage” for most major economies from weak or strong employment protection. More specifically for the UK – which has one of the lowest levels of employment protection worldwide – there was little to be gained either from further de-regulation or from significant re-regulation.
For UK readers following the debate on employment policy in the run up to the May general election, the primary interest of this report is that it puts the CIPD firmly in the “do as little as possible” camp. But there is more to it than that. We are all probably familiar with the areas in which the UK economy performs badly – for example high youth unemployment and poor productivity. It is less well known that the UK scores better than all our major European competitors on the percentage of permanent jobs and has an exceptionally high share of well-paid jobs (higher than Germany, France or Italy).
Another surprise – at least for those with a more pessimistic outlook on the UK labour market – is that the UK scores highest of the four largest EU economies on various employee satisfaction surveys despite having the lowest degree of employment protection. As the author points out, that may in part be due to the fact that it is an oversimplification to isolate employment protection from other measures that regulate the workplace – for example health and safety and equality legislation, both areas which are quite tightly regulated in the UK.
The overall conclusion of the report is also interesting: in the UK “workplace practice matters much more for good work than legislation strengthening employment rights”. With this in mind, it endorses the CIPD’s suggestion for the creation of a Workplace Commission to co-ordinate policy across government and to engage with key “social partner” institutions like ACAS, the CBI and the TUC. That is not to say that there is no scope for legislation to correct abuses in particular areas or to improve enforcement. The report also joins calls from other quarters for action to be taken to resolve the “confusion and ambiguity” about the relative status of employees, workers and the self-employed.