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Osborne commoditises labour

After Vice Cable refused to accept no-fault dismissals recommended by the private equity capitalist Anthony Beecroft, Osborne has brought them back via the back door. To offer £2,000 worth of shares in the company in exchange for giving up all your employment rights is not an equal exchange of benefits, it’s a sacrifice of job-protecting opportunities for a pittance. Nor is it going to be a choice for long, only for existing workers.

For all new company start-ups and new employees taken on, it will be a mandatory condition of employment. Nor is it just protection against arbitrary dismissal that is being lost. The new job contracts planned by the government after April 2013 will involve loss of redundancy rights, loss of flexible working options, loss of time-off for training, and a requirement for double the period of notice to be observed for a return to work from maternity leave (16 weeks rather than the current 8 weeks).

Why is the government doing this? The idea that employers are not hiring more workers because of these employment rights is an absurd pretence. Obviously it’s because the economy’s flat or shrinking and there’s no demand for extra products or services. Osborne’s proposals won’t create jobs and won’t generate growth. And Osborne’s claim to be fostering employee-owned companies is equally preposterous. £2,000 is likely to amount to less than 1% of the company equity. But anyway, as with Thatcher’s failed attempt at widening shareholder capitalism, most employees are now so cash-squeezed that any shares they get are likely to cashed in at the first opportunity.

The real explanation behind this move is that the Tories are now going for broke. They’re facing up to the increasing likelihood that they’ll be a one-term government and are throwing all their goals into the pot before they’re forced out, however extreme – full privatisation of the NHS, outsourcing of virtually the whole range of public services under the ‘any qualified provider’ label, and now the total evisceration of employment rights.

There’s onf further angle to this saga too. The implicit suggestion that, internationally, Britain is held back by stringent or over-protective employment rules is frankly dotty. If that were so, why is the current UK jobs market at a record high? In fact British labour laws are much less onerous or demanding compared to continental ones. This latest Tory move has nothing to do with freeing up a hidebound labour market, it has all to do with pushing to the extreme the consolidation of corporate power at the expense of workers bereft of any redress.


  1. P Spence says:

    Surely the Lib Dems will not let this through.

    These are minimal rights which already, in my experience practicing employment law, offer little impediment to employers hiring and firing.

    Further good reason for a high turn out on the TUC 20 October march.

  2. Dave says:

    “Surely the Lib Dems will not let this through.”

    You couldn’t slip a cigarette paper between the Orange Bookers and the Tories – they’ve let the Tories in, don’t expect them develop a conscience any time soon.

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