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The first few months of 2023 were characterised by concerns about teacher strikes, the gender pay gap and childcare in the lead-up to the Budget.
The year began much as it finished… with strikes for higher wages amid rising prices and following years of austerity. January saw teacher strikes which affected many parents. There was also a lot of discussion about the impact of hybrid working, which has taken over a lot of the discussions about flexible working over the last years.
Nevertheless, a report in January sought to shift that focus onto part-time work. The research from Cranfield University’s School of Management said Government and employers should invest in a part-time working pilot to capitalise on the experiences of flexible furlough and encourage openness to part-time working.
The ‘Part time working after the pandemic’ report, authored by Clare Kelliher, Professor of Work and Organisation at Cranfield University, Dr Charlotte Gascoigne and Dr Pierre Walthery, looked at the experience of firms that used the flexible furlough option as the country exited lockdown. Flexible furlough allowed organisations to bring back employees on a part-time basis with the government topping up their wages. The report argues that experimentation and innovation in the workplace should be encouraged to help embed new ways of working, share best practice and attract and retain talent.
Childcare was high on the agenda from the beginning of the year leading up to the Spring Budget. Pressure ramped up on childcare reform, with the CBI saying the government’s “small” moves on childcare reform were not enough if it wanted to address worker shortages. In a speech CBI chief Tony Danker cited childcare reform as one of the key issues that will get more people into the workforce. Meanwhile, preliminary findings from a Coram Family and Childcare survey of councils found almost half say that some local childcare providers have had to reduce their opening hours, while a similar proportion said some or many providers had reduced the number of funded places they could provide because of funding problems.
January also saw the launch of a new campaign aimed at encouraging the recruitment industry to open the debate around salary transparency. The talent platform Liberty Hive argued that banning questions about past salary history and improving salary transparency are key to diversity and inclusion. The campaign comes after Baroness Stedman-Scott launched a salary transparency scheme in March 2022, backed by the Fawcett Society, where participating employers list salary details on job adverts and stop asking about salary history during recruitment.
In the month WMPeople launched its first podcast and announced its Top Employer Award winners, there were worries about the impact of the cost of living crisis on talent retention.
Childcare continued to be a big issue. An Early Years Alliance survey found almost nine in ten respondents said they were probably or definitely increasing their fees this year, with the average planned fee increase at 8% amongst those who have not yet raised fees. The CBI called on the Government to launch an Independent Review of childcare, increase funding so providers receive funding that reflects the true cost of service provision and roll-out subsidised children to all one and two year olds.
In benefits news, a report from the Child Poverty Action Group and the North East Child Poverty Commission found families are losing out on an average of £73 a month due to debt deductions from their Universal Credit. The most common reason for debt deductions is loans taken out to cover the five-week wait for their first payment.
A study of benefits reforms over the last few years by the Institute for Fiscal Studies found that, while UK benefit reforms have got more people into work, most of the work is part-time and low-paid and rarely leads to career progression meaning many are trapped on in-work benefits.
Meanwhile, research from the Resolution Foundation concluded that Government efforts to boost Britain’s workforce should focus on supporting more mothers into work, and helping older workers and those with a disability stay in work, rather than persuading the large Covid cohort of older workers to ‘unretire’.
When it comes to women in senior leadership, the FTSE Women Leaders Review showed women now occupy over 40% of the board roles at Britain’s biggest listed companies, but it noted that there was still “more to do” regarding the proportion of women on executive committees, which stood at 27% amongst FTSE 350 companies in 2022.
In February water company Severn Trent became the first FTSE 100 firm to appoint women to the company’s three top positions: chair, chief executive and chief financial officer.
As the employment tribunal backlog worsened, research from Cardiff University shows that performance-related pay, particularly for more senior roles in the private sector, accounts for 12% of the overall gender pay gap, making a larger contribution than many other influences, such as tenure or temporary employment status.
In other news, McDonald’s signed a legal agreement with the Equality and Human Rights Commission [EHRC] in response to concerns about the handling of sexual harassment complaints made by staff in its UK restaurants.
Meanwhile, a report on the world’s biggest four-day working week pilot claims almost every company has decided to continue with the new day of working. The trial is based on the idea of reducing the working week by 20%, with no loss of pay for workers, to allow more opportunity for rest. Individual employers taking part could interpret this in their own way and according to the demands of different functions in the business or of their sector.
As the UK fell five places in an annual gender equality index of OECD countries, a TUC survey for International Women’s Day found women are around seven times more likely than men to be out of the labour market due to caring commitments. Another survey by the British Chambers of Commerce showed two thirds of mothers say that having children has affected their career progression.
Childcare was again a major issue, with staffing shortages being flagged and a report from Nesta showing an hour of childcare in England costs nearly a third of the median pre-tax hourly wage. Mid-month the Chancellor announced in his Budget speech the Government’s plans to expand subsidised childcare provision over the next two years to cover children from nine months upwards, but questions remain over whether the Government will provide enough funding to back up its big announcements.
There were also concerns about Government plans to change Universal Credit rules so primary carers whose youngest child is over three will need to be available to work up to 30 hours a week, almost double the previous threshold of 16 hours, if they want to continue receiving the benefit. The Government says this aligns with its childcare offer, which includes raising the cap on the amount of money that UC claimants can get to cover childcare costs and paying for upfront childcare fees for claimants.
On gender equality, a report from Ipsos UK and the Global Institute for Women’s Leadership at King’s College London found people in the UK are increasingly afraid of promoting women’s rights for fear of reprisals, with the number saying this having doubled since 2017, rising from 14% to 29%.
Meanwhile, debates about remote and hybrid working continue with a business survey from Boston Consulting Group’s Centre for Growth finding that only 8% of business leaders said the move to remote working has had an overall negative impact on staff performance while nearly a third (29%) of business leaders said they had hired purely remote workers in response to labour shortages.
The TUC called on the Government to require companies to publish action plans on how they will address the gender pay gap and to strengthen access to flexible working. The call came on the deadline for gender pay gap reporting. Gender pay gap reporting was introduced in 2017 for employers with more than 250 employees, but the TUC says the pay gap is closing “at a snail’s pace”, falling at an average of just 0.4% a year. Analysis of this year’s gender pay audit figures by the Financial Times shows nearly 80% of UK employers pay men more than women on average, with the gender pay gap having worsened since last year and since 2017.
The Government also published voluntary guidance to help employers who wish to analyse and report on their ethnicity pay gap, but campaign groups said that publishing should be mandatory and backed by action plans on how to address any gaps.
Meanwhile, a report from the Resolution Foundation found the UK is falling behind many countries when it comes to the “replacement rate” for state maternity pay. The UK’s statutory maternity pay replaces 27% of a woman’s average earnings in the private sector over one year, it says, while the average “replacement rate” across 34 developed countries is 40%. Over a dozen of those countries, mostly in Scandinavia and eastern Europe, have a replacement rate of over 50%.
Concerns about sexual harassment at work continued to mount as the CBI lost members over accusations of sexual assault and amid calls for the Government not to backtrack on legislation addressing sexual harassment laws at work.
In benefits news, a Government report finds the average Universal Credit claimant who has been sanctioned ends up earning less than other claimants, which critics say proves that sanctions do not work.