Stephanie Peacock, MP for Barnsley East, has slammed Government Ministers after revealing that they have quietly delayed closing a loophole that allows bosses to keep workers on insecure contracts and poverty pay.
The latest admission, in answer to a parliamentary question from the Labour MP, contradicts a previous assurance given in the Commons earlier this month by Business Secretary Greg Clark that he would reconsider the timetable.
It also undermines the Prime Minister’s announcements on workers’ rights, intended to win over trade unions and Labour backbenchers to her Brexit deal. Just weeks ago, Theresa May had cited her action on agency workers as a reason to trust her Brexit agreement to protect workers’ rights, and key trade unions have a reacted with anger to news that the measure had been delayed.
Agency workers are meant to be treated equally to permanent staff but employers can dodge the rules by using so-called ‘pay between assignment’ contracts, under which the agency itself is considered the employer, even when the worker is in fact permanently placed in one workplace. The Resolution Foundation found bosses used the loophole to underpay workers by £173m a year.
Business Secretary Greg Clark had announced that he was accepting the recommendation of the ‘Good Work’ Review to close the loophole. The Review, undertaken by Matthew Taylor, had first been commissioned by Theresa May in October 2016 and reported in July 2017.
However, Ministers admitted to the Barnsley East MP that they had quietly delayed implementing the change until the 2020-21 tax year, leaving agency workers unprotected for both the current and next financial year.
When she challenged Clark on the date in the Commons earlier this month, he told the House that “I have had representations from the trade unions as to the timing, and we will reflect on that.”
But junior minister Kelly Tolhurst has now confirmed that the government is not reconsidering the delay, so as “to allow time for businesses to realign their contractual arrangements”.
The government has faced similar criticism for delaying legislation to ensure waiters are entitled to tips left until the next Queen’s Speech, despite the change first being promised in May 2016.
Commenting on the revelation, Stephanie said: “The Prime Minister keeps asking us to trust them but once again she has shown exactly why we can’t. The Business Secretary promised me in the Commons that he’d reconsider this delay only to renege at the very first moment he thought he could get away with it. We simply can’t take their word for anything, let alone on an issue as important as our fundamental rights at work.
“This is the government that took two and a half years with a review, a consultation on the review and a consultation on the consultation, yet still leaves agency workers waiting until 2020-21 for equal treatment. Apparently Tory Ministers are unwilling or unable to implement even their own limited promises.
“Vulnerable workers here in Barnsley and across the country need urgent action, not more dithering from a government in chaos.”
The news came weeks after Tolhurst admitted that the government was also delaying a flagship promise to ensure that tips left by customers for staff in bars and restaurants go to staff.
Legislation on fair tips had first been proposed by the government in May 2016, and the Prime Minister made it a key announcement at Conservative Party Conference in October 2018. The government’s ‘Good Work Plan’, heralded by the Prime Minister this week, boasted about “the government’s record … including ensuring tips left for workers go to them in full”, despite this promise remaining unfulfilled.
But challenged on the discrepancy by Stephanie Peacock in the Commons, Tolhurst replied that they would “bring forward legislation in the next Session…”, meaning that no Bill will be tabled until the next Queen’s Speech.