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Labour Government Hub

Topics28th October 2024

With the Labour Government now well-established in office, and through their first 100 days, we are starting to see their manifesto pledges coming to the fore through announcements and consultations. This page is your one-stop shop for all the key announcements from Government, including on the recently announced Employment Rights Bill.

We will provide REC members with detailed information on policy changes and announcements with a perspective on how they could impact the recruitment industry. Stay informed with the latest updates from the REC’s campaigns team as we continue to stand up for our sector, ensuring that your interests are represented to the Government.

Keep checking back for the latest insights and developments from the new government, particularly on the consultation tracker, which highlights all the opportunities for you to have your voice heard with government as well.

2024 timeline REC Manifesto for growth General Election Webinar

Policy tracker Government Consultaions

Government Consultations

As we move further into Labour’s government, they have begun consulting on a number of topics regarding their manifesto commitments. This includes the Employment Rights Bill, changes to the NHS and the new Industrial Strategy. To help members keep abreast of the latest developments, all the consultations that have been released by the new government are collated below, with links to the government’s website for more information. As and when the REC has submitted our own response to each consultation, these will also be added to keep members informed of our work on these issues.

On the table below, consultations specifically related to the Employment Rights Bill and wider Plan to Make Work Pay are highlighted in italics.

Consultations

Consultation	Opening Date	Closing Date	REC response summary	Full REC response
Invest 2035: the UK’s modern industrial strategy	14.10.24	24.11.24	To be successful, any Industrial Strategy must go hand in hand with considering our workforce. It must make skills policy more suited to the needs of our economy, but also look beyond skills to consider production and job design, investment and infrastructure such as transport, childcare and the immigration system.	Final Submission
Change NHS	21.10.24	02.12.24	Agency work is crucial to a properly functioning NHS as it can play an important role in supporting the substantive workforce. NHS procurement needs to be reformed to allow for the cost-effective recruitment of agency staff, with the overreliance on bank or off-framework staff driving up costs to the taxpayer. Reviewing the current frameworks to allow effective on-framework supply will reduce staffing costs overall.	Final Submission
Making Work Pay: the application of zero hours contracts measures to agency workers	21.10.24	02.12.24	Agency workers should be exempt from the government's new proposals to limit the use of ZHCs to avoid unintentionally undermining the temporary labour market. People choose to work as agency workers for the flexibility these contracts can allow them, so way of working needs to be preserved. If a full exemption is not possible, then the government needs to ensure responsibilities and liabilities sit with the correct parties in the supply chain to minimise the impact of these changes.	Final Submission
Making Work Pay: Strengthening Statutory Sick Pay	21.10.24	04.12.24	The government needs to consider the impact of this on agencies, and how it can practically be applied to temporary workers who have irregular working patterns. This needs to be coupled with clarity on how agencies can limit exposure to ongoing sick pay for temporary workers to avoid the new SSP entitlement being exploited. Additionally, Government should make available provisions to help businesses cover these costs, especially at a time when cost pressures are biting hard.	Final Submission
Making Work Pay: creating a modern framework for industrial relations	21.10.24	02.12.24	Reforms to Trade Union rights should be welcomed provided they are designed to foster better workplace relations. There needs to be a balance struck between worker rights and ensuring businesses are able to manage their workforce planning.	*REC has chosen not to submit a response to this consultation*
Making Work Pay: collective redundancy and fire and rehire	21.10.24	02.12.24	Clearer policies and processes around fire and rehire and redundancy are important to workplace relations. However, it is important that these processes remain viable as last resort courses of action in order to ensure businesses are able to continue operation in worst case scenarios.	*REC has chosen not to submit a response to this consultation*

2024 Timeline

Click any date below for full details

July 2024

17 July -REC comments on King's Speech 2024

Commenting on today’s King’s Speech, Neil Carberry, REC Chief Executive, said:

“Today’s King’s Speech sets out an ambitious programme for the new government. Businesses share the view that getting economic growth going should be our priority – and are ready to help. We welcome the commitment to a new partnership with business. Only growth can deliver the individual prosperity and funding for public services we all need.

Read the full press release here

17 July - King's Speech: What this means for our industry?

REC’s Political Advisor Connor French analyses key points from the King’s Speech and what this means for the recruitment industry

Read it here

June 2024

13 June – Plaid Cymru policy on Agencies

In their manifesto Plaid Cymru have set out their position that private sector shareholders should not be profiting from people’s poor-health. This announcement plays in to the wider narrative that agencies are overcharging and profiting off of the NHS. Plaid Cymru have stated that “shareholders should not be profiting from people’s ill health, and that profits from private agencies would lead to a better service if it was instead re-invested into healthcare.”

At the REC we know that agency workers play a valuable role in staffing for the NHS, and in order to maximise efficiency we need to see a proper partnership approach between the NHS and healthcare staffing providers. We need to see reform to public sector procurement that acknowledges the increase in spend has been driven by off-framework and bank staffing, and introduces a new procurement model that allows agencies to provide staff in a cost-effective and compliant manner. REC will continue to drive this messaging with all parties.

13 June - Childcare Announcement

Labour pledge to create more than 100,000 new nursery places

Labour has pledged to create more than 100,000 new nursery places for nine-month-old children ahead of the publication of its full general election manifesto. The intention behind this policy is to support children in making the transition into compulsory full-time education. A key goal is to break down the barriers to future opportunities for children by boosting child development and hitting early learning targets.

REC feels strongly about improving the childcare system in the UK but for Labour's plans the details of how to create these places will be crucial, alongside their wider plans for supporting the workforce. Labour has previously briefly mentioned the need to expand the workforce and build capacity; however, this needs to be expounded upon through consultation with industry professionals.

Our key asks in this space are:

Expand the eligibility for 30 hours of childcare entitlement to parents and carers in training or education.
improve access to childcare for working families by reforming childcare benefits and improving funding for childcare providers.
Create a childcare workforce strategy, developed in partnership with childcare providers to maximise the efficiency of funding in the sector.
Make it easier to access childcare provision by removing bureaucracy and expanding access to childcare support to those in training and education to remove barriers to employment.
Grant a business rates exemption to all early years providers to boost the availability of childcare.
Governments should commit to reviewing the childcare system and increase the financial contribution to the tax-free childcare scheme for parents and grandparents.

REC has previously set out our asks for childcare provision in the UK in our manifesto, Dynamic Labour Markets for Growth, and more details on the above recommendations can be found here. REC would be keen to work with any future Labour government on this issue, to ensure changes are implemented in an effective and useful manner.

2 June -REC comments Labour's announcement to cut net migration:

Commenting on Shadow Home Secretary Yvette Cooper’s comments on Labour’s plans to cut net migration by reducing visas for overseas workers, Neil Carberry, REC Chief Executive, said:

“The Shadow Home Secretary’s comments on bringing down work-related immigration need to be set in a wider economic context. Of course, fixing the skills system and better back-to-work support will help, but that is not a quick fix. We currently have a broader shortage of people - not a few specific shortages. Labour would cause problems for its own growth goal by restricting firms from access to workers where the alternative might be work going elsewhere. There is also a risk of lower competitiveness as firms struggle to meet their needs. There was however some hint of understanding the scale of the issue in the Shadow Home Secretary’s comments about workforce planning.

Read the full press release here

May 2024

29 May - REC comments on apprenticeship announcements by the Conservatives

Commenting on apprenticeship announcements by the Conservatives, Neil Carberry, REC Chief Executive, said:

“The apprenticeship brand is strong in the UK, and it is great that skills are part of the General Election debate. But the announcements by the Conservatives do not deliver the reform that many employers want and shows the need for policymakers to work closer with business on solutions.

It does not address the failures of the apprenticeship levy, it does not focus on the intermediate level skills that our economy needs or focus on young workers. After all, we need both apprenticeships and university courses to provide pathways for young people to flourish and overcome labour and skills shortages to help our economy to grow."

Read the full press release here

28 May - REC responds to Shadow Chancellor’s speech

Commenting on Shadow Chancellor Rachel Reeves’ speech today, Shazia Ejaz, REC Director of Campaigns and Research, said:

“The Shadow Chancellor’s commitment to working in partnership with business must extend to working with the recruitment sector on initiatives to overcome labour and skills shortages. This will help avoid the risk of the UK economy missing out on £39 billion every year caused by these shortages.

Our recruiter members and their clients are clear that better aligning the skills system with business and worker needs will help. Therefore, we urge Labour’s to act on its commitment to reform the Apprenticeship Levy within its first 100 days in government."

Read the full press release here

22 May - REC comments on announcement of General Election

Responding to the announcement of a General Election, REC Chief Executive Neil Carberry said: “Any plan for competitiveness is fundamentally about the talent and application of our British workforce. In the next few weeks, politicians must show that they really get today’s labour market. From helping people build skills to investment in transport and childcare, there is a lot to do. But it starts with understanding that workers and businesses need a more flexible approach than in the past, and that our regulation, skills and tax systems need to keep up."

Read the full press release here

REC Manifesto - Dynamic Labour Markets for Growth (2024)

PDF

OUR FOUR KEY ASKS

This manifesto sets out four key themes, supplemented by focused recommendations aimed at supporting policymakers better understand the crucial role of the labour market, and how it underpins economic success.

Theme One Theme Two Theme Three Theme Four

Understanding today’s people and labour market challenges

The Government should put people issues and the labour market at the heart of a new Industrial Strategy that prepares the UK for 2030. Any new Government must embrace this – along with the recognition that demand for temporary work by both employers and individuals is increasing. Better support for flexible forms of working will add dynamism to our labour market. To build a better understanding of today's labour market, government should:

Work with businesses and employee representative bodies to develop a Workforce Plan for the UK. It must make skills policy more suited to the needs of our economy – but it must also go beyond skills (including transport, childcare, immigration).
Conduct a Workplace Employment Relations Study (WERS). This will provide the foundation for an evidence-based, robust workforce strategy. The survey will offer insight into how the labour market is functioning, and what workplace performance is really like.

Supporting our labour market transition by preparing for the future

Better aligning the skills system and working with businesses and labour market experts to understand how people work, what jobs they want, and how to motivate them is critical for future growth. In the last few years, we have seen increases in the so-called “gig economy” and other flexible working practices, notably as economic inactivity has risen and demands between the home and workplace have blurred. Recruiters are on the frontline of understanding and managing these issues. Agency work is well-regulated, and we should apply the same standards to emerging forms of flexibility to protect standards and opportunity. To prepare for our future labour market, we recommend:

Supporting local jobs through Local Skills Improvement Plans/LSIPs model. Labour market experts should be represented across (LSIPs) in England. This will allow businesses, education and training providers to hear directly from recruiters about what local jobs are in demand and how work is changing.
Introducing immigration policy that supports employer needs. The increased salary threshold for the Skilled Worker Visa needs a rethink. Successful modern economies are international but higher thresholds sends the wrong signal around the world, splits up families, and robs the UK of key people at a time of real shortages. Survey after survey shows people support immigration by those who are here to work, pay tax, and build a life. Public policy should reflect this. We also believe the Government should conduct an impact assessment into its policy to reduce visas for dependents of those on Health and Social Care visa routes and whether this exacerbates labour market shortages.
Embedding net zero and tech change into education to enable future employment needs. Continue building on the Gatsby Benchmarks to ensure every young person gets effective careers advice with a clear understanding of career pathways, particularly in emerging sectors that support Net Zero and technology change. Use schemes like Kickstart and Restart to promote the uptake of digital and green skills training.
Establishing the UK as a world leader in the safe and ethical use of AI. Develop an AI assurance framework and work with employers to promote best practice around its safe and ethical use.

Boosting workforce productivity and driving down inactivity

Temporary and flexible work is often a catalyst for older workers, workers with long-term health conditions, younger workers and underrepresented groups to access the labour market. We have to get people into work, and that means understanding and addressing the barriers to that. This will require investment in key infrastructure, like reliable public transport and sufficient childcare support. Our specific recommendations include:

Reform the Apprenticeship Levy to fund high-quality, modular training to enable more people, including temporary workers, to train and fill vacancies.
Expand the eligibility for 30-hours childcare entitlement to parents or carers in training or education.
Reform public sector procurement processes to get better value for taxpayers and efficiency for service providers.
Mandate ethnicity and disability pay gap reporting for larger businesses to further diversify the labour market.

Regulating for a sustainable and dynamic labour market

Nearly half of the UK working population works in a non-permanent, flexible way. Too often, agency workers are forced to work around legislation designed for employees in permanent roles, resulting in confusion and sometimes a lack of clarity about the rights they have. Specific recommendations include:

Review and revise employment laws to reflect the increasingly flexible way that people work. We'd recommend starting with the completely outdated Working Time Regulations - enacted in 1998.
Introduce regulation for the whole labour supply chain - including umbrella companies and joint employment models - bringing them under the scope of the Conduct of Employment Agencies and Employment Business Regulations 2003.
Introduce a properly-resourced Single Enforcement Body (SEB) to improve coherence between departments, support better compliance and provide more clarity on worker rights.

General Election Webinar

Watch back an insightful webinar from straight after the General Election with Neil Carberry, REC Chief Executive and Kate Shoesmith RE Deputy Chief Executive. This webinar will delve into the main manifesto promises, what we know, and where the risks and opportunities lie for the recruitment and employment agenda.

Watch more on demand

Policy Tracker

Labour Party Manifesto 2024: "Change"

On Thursday 13 June the Labour Party unveiled their 136-page manifesto from the grand atrium of the Co-op HQ building in Central Manchester. Despite the attempt by a lone protestor to disrupt proceedings, Starmer talked through his 'no surprises' offer to Britain. 'No surprises' being that the Party had trailed out every big announcement that they planned to make in the weeks leading up to the launch.

Key policy headlines

Labour's Plan to Make Work Pay remains in their manifesto, focusing on their commitment to ban 'exploitative' zero-hour contracts, ending fire and rehire, day one rights, and creation of a single enforcement body'. There was no explicit mention of creating a single worker status.
Labour committed to the creation of an Industrial Strategy, including an Industrial Strategy council which will collaborate with business.
Labour will scrap the apprenticeship levy, instead creating a new 'Growth and Skills levy'.

For a fuller list of policies, click here.

Plan to Make Work Pay

Labour’s Plan to Make Work Pay still includes banning 'exploitative' zero-hour contracts and ending fire and rehire practices, which they claim will provide more job security and stability for workers. Introducing an entitlement to rights such as parental leave, sick pay, and protection from unfair dismissal from day one of employment still remain in the plan. Despite this, there is no mention of the creation of a single status of worker, as included in previous plans. Many of these announcements potentially present a step-change in Labour's position on workers’ rights compared to the last draft few months ago. This positive change is in part down to the REC's hard work behind the scenes engaging with the Labour Party to help them understand why some of their initial proposals would have been damaging for business, individuals and the economic growth we all want.

The plan also has commitments to strengthen the role of trade unions in work-place relations and to establish a Single Enforcement Body. We raised the importance of a SEB in conversations with the Labour politicians so are glad to finally see a comprehensive compliance system around flexible employment practices on the horizon. We hope the expertise of the Employment Agency Standards Inspectorate is retained.

Industrial strategy

In their manifesto, Labour commit to creating a new industrial strategy. This is something that the REC have long been calling for, including in our 2024 REC manifesto, Dynamic Labour Markets for Growth. Labour plans to work with industry on developing the strategy, including establishing an Industrial Strategy Council to provide expert guidance, ensuring representation from all regions, industries, and trade unions. They say that this council will play a pivotal role in steering long-term economic policy, moving away from 'short-termism' and towards strategic planning. They said they want to support sectors where the UK holds competitive advantages such as research, professional services, advanced manufacturing, and creative industries. We will want to help shape the work of the council. They are keen to say that their industrial strategy aims to create a "pro-business environment with a competition and regulatory framework which supports innovation, investment, and high-quality jobs". They mention aligning procurement and trade policies with strategic economic priorities. For REC members, understanding these proposals when there is more detail will be essential to navigate potential changes in regulatory frameworks and economic policies that could drive labour market demands. We will help with that

Business taxation

Labour have committed to providing ‘stability’ by holding only "one major fiscal event" each year. They have also pledged to cap corporation tax at 25% to reassure businesses against unexpected tax increases.

They say they aim to stimulate business growth by maintaining full expensing for capital investments and retaining the annual investment allowance for small businesses. They also propose significant reforms to the business rates system with the intention to "level the playing field between high street retailers and online giants".

Skills

Labour’s skills strategy emphasises aligning training with market needs to address the current skills shortage. They will establish Skills England to bring together businesses, training providers, unions, and government to meet the training requirements needed for their industrial strategy. They will collaborate with the Migration Advisory Committee to ensure training in England addresses the overall needs of the labour market. The REC has previously set out the need for skills and immigration to be more closely aligned. Labour have also pledged to scrap the apprenticeship levy and instead create a 'Growth and Skills levy'. We will await detail to see if levy funds can be used for modular short courses for agency workers. In the manifesto there are also plans to devolve adult skills funding to Combined Authorities, with consultations on eligible courses, with the intention to ensure that qualifications offer "value for money" and meet market demands.

Immigration System

Labour plans to reform the points-based immigration system. The REC has highlighted the risk that restricting work-related immigration could constrain Labour’s growth goals by limiting access to essential workers. While fixing the skills system and providing better back-to-work support are crucial, these are not quick fixes for the current broader shortage of people. Labour's proposed reforms must balance immediate business needs with long-term workforce planning.

Health & Social Care

Labour set out plans to deliver an extra two million NHS operations, scans, and appointments every year, which works out at 40,000 more appointments every week, by incentivising staff to carry out additional appointments out of hours. "Regular, independent workforce planning across health and social care" are in Labour's plan, along with an NHS long-term workforce plan that trains the necessary staff to reduce patient waiting times. However, there is no mention in Labour's plans of how staffing procurement will work for the NHS or the necessary role that agency workers must play within this. Labour will also undertake a programme of reform to create a National Care Service, "underpinned by national standards, delivering consistent care across the country" and establish a Fair Pay Agreement in adult social care.

Devolution

Labour has committed to establishing a new "Council of the Nations and Regions," which will bring together the First Ministers of Scotland and Wales, the First and Deputy First Minister of Northern Ireland, and the mayors of combined authorities. This initiative aims to ensure that regional and national leaders have a direct influence on policy decisions.

Overall there is a positive focus on growth in Labour’s manifesto which is key to lowering taxes and improving public services, with a particular look at a modern industrial strategy that supports the dynamic nature of work. It is also positive to see Labour’s plans for skills development and emphasising the need for flexible training options. Additionally, we note Labour’s commitment to modernising employment laws, enhancing clarity for workers’ rights, and supporting compliance in flexible employment practices. Finally, it is important that we take a balanced approach to immigration to ensure access to both UK and overseas talent, crucial for economic growth and addressing skills shortages in sectors like healthcare and public services.

Discover more parties key policies

Discover other parties key policies from their 2024 manifestos. These are not complete manifesto summaries and focus on the key areas that are most relevant to REC members. These have been directly taken from the respective manifestos and the specific wording is not necessarily the view of the REC.

Conservative Liberal Democrat Other Parties Policies

What we have been working on

The REC Manifesto aims to help policymakers better understand the crucial role of the labour market as a strategic driver of economic growth in the UK. It explains how targeted policy interventions can help our diverse workforce spur economic growth, enhance public services, and boost productivity - making the UK a competitive place to live and work.

Our manifesto sets out four key themes, supplemented by recommendations aimed at supporting policymakers better understand the role of the labour market, and how it underpins economic success.

The current suite of employment legislation just isn't reflective of modern working practices, and updating some key pieces of regulation would provide a crucial boost to the UK labour market. Many of the regulations need updating to be more inclusive of different forms of work, like agency work, and to better protect people and their employers in how we work today and to futureproof us in work.

Our guide to Labour Laws Fit for the Future to find out more and read our recommendations.