Over the year, the General Council has continued to track and comment regularly on the difficult conditions faced by working people, and set out prescriptions for change. To cap a dismal decade, GDP growth of 1.4 per cent in 2018 was the weakest since the global recession.
Our statement ahead of the HM Treasury Spring Statement 2019 showed that the recovery since the recession has been the slowest for more than a century.
In recent years, continued slow growth has in part reflected the repercussions of and ongoing uncertainty over the shape of the UK’s future relationship with the EU, with business investment once more grinding to a halt in 2018. But the critical factor throughout has been the government’s austerity policies, which, as the TUC has consistently argued, have damaged the prospects for growth in the UK.
The damage to public services is increasingly apparent. Government has talked about the ‘end of austerity’, but this is far from a reality.
The damage to public services is increasingly apparent. Government has talked about the ‘end of austerity’, but this is far from a reality. The Office for Budget Responsibility has shown that cuts continued into 2018–19, so that real government spending is down £750 per person or 15 per cent since 2009–10. According to the current OBR projection, in five years’ time only £250 of the lost ground will have been made up.
Any increased spending has been allocated to the NHS only; the OBR confirms that spending across all other departments is at best flatlining.
In November, the TUC hosted a joint meeting between TUC and TUAC (the Trade Union Advisory Committee to the OECD). This included a session on ‘lessons from the 2008 financial crisis’ opened by the former UK prime minister Gordon Brown.
In spring, the TUC called for a more substantial immediate increase of £25bn in public service spending as a first step to restoring the health of the economy, public services and public finances.
This year, Frances O’Grady became a non-executive member of the court of the Bank of England and a council member of the Institute for Fiscal Studies.
1.2 Special feature: stronger together at work – re-booting collective bargaining and workplace voice
TUC activity this Congress year has been guided by resolution 2, ‘The future of the retail sector’, resolution 5, ‘Automation’, and resolution 6, ‘Automation and its impact on black workers’.
TUC General Secretary Frances O’Grady has served on the Made Smarter Commission, which seeks to implement the so-called ‘fourth industrial revolution’, in the UK. At the TUC’s initiative, the Made Smarter Commission has developed a ‘Made Smarter Charter’, which sets out best practice, including working with union representatives, for the implementation of technology associated with the fourth industrial revolution. The Made Smarter Charter is due to be launched in September 2019.
The TUC also forms part of an ETUC team negotiating an autonomous framework agreement on digitalisation, designed to protect workers across Europe as digital technology comes on stream.
The General Council’s vision for the future of work includes decent hours and good work/life balance. With most commenters predicting that automation will increase productivity, our flagship long-term campaign is for a shorter working week without reduction in pay. The TUC held an event with union reps and activists to develop the campaign in May.
The TUC has also been invited to discuss this campaign and the wider future of work with a broad range of stakeholders. Paul Nowak was a panel speaker at the OECD Going Digital Summit in March and the OECD Forum in May, and the TUC gave evidence to the Business Energy and Industrial Strategy Select Committee, formed part of the tripartite consultations on policy around the future of work organised by the OECD, was represented at events organised by The Guardian on a four day week and on artificial intelligence (AI), and was represented on a panel at ‘CogX’, an annual conference for the tech industry on AI and emerging technology.
The TUC has also campaigned against excessive working time, as 3.3 million employees still work more than 48 hours a week. The work programme has included campaigning for tighter working time rules and better holiday rights and enforcement. TUC analysis also showed that UK full-time workers work the longest hours in Europe. The fifteenth TUC Work Your Proper Hours Day (February) called for excessive unpaid overtime to be cut. Employees did £32.7bn of free work last year.
In addition, the TUC has continued to campaign for wider access to home working and flexible working, including Commute Smart Day (November), and National Work from Home Day (May).
The TUC continues to produce regular analysis of the performance of the UK labour market, focusing on the ongoing wage squeeze, the scale of insecure work and wider inequalities.
While employment has remained high by historic standards, and unemployment low, the sustained reduction in real pay continues. Over the past decade, workers have suffered the most severe wage squeeze in two centuries. While real wages have just started to grow, there is considerable ground to make up before real pay returns to the level it was at before the recession hit.
The pay squeeze has hit the living standards of working families hard, and millions are still in poverty. Of those living in poverty, 57 per cent (eight million people) are now in working families.
TUC analysis ahead of the TUC Disabled Workers’ Conference showed that, in addition to a disability employment gap, the disability pay gap is 15 per cent or almost £3,000 a year, and even higher for disabled women.
Analysis for the TUC Women’s Conference looked at the gender pay gap. The current gender pay gap for full-time and part-time employees stands at 17.9 per cent. TUC analysis showed this pay gap means that women effectively work for free the first 65 days of the year.
In line with resolution 21, the TUC has continued to fight against the spread of insecure work, such as insecure agency work, false self-employment and zero- and short-hours contracts.
Our analysis shows insecure work is a daily reality for 3.7 million UK workers; this is one in nine in employment. This includes agency, casual and seasonal work, those on zero-hours contracts and the low-paid self-employed. A pay penalty is associated with these forms of work, with workers often experiencing low pay and economic hardship and a lack of control over their working hours. Millions of workers are still stuck in low-paid, insecure work and often find shifts are cancelled or changed with no notice. Insecure work is disproportionately experienced by black and minority ethnic (BME) workers, and TUC analysis showed that BME workers are more than twice as likely to be stuck on agency contracts than white workers.
The TUC sought to highlight the continued high levels of insecure work during this year’s HeartUnions week, devoting the campaign to a call to ban zero-hours contracts.
We know that collective bargaining is the best way to deliver better rights for working people, and over the last year we have worked with affiliated unions to develop detailed policy to give trade unions new rights to organise and represent workers at individual, workplace and sectoral level.
The General Council’s work focused on creating a better deal for low-paid workers was informed by resolution 22 and emergency resolution 5.
The number of employees earning less than two-thirds of the median earnings benchmark fell by 200,000 last year, largely because of the rising national minimum wage (NMW).
The General Council has campaigned for more significant increases in the NMW. This has included media, lobbying and engagement with the Low Pay Commission (LPC). Workers were represented on the LPC by Kate Bell (of the TUC), Kay Carberry (formerly of the TUC) and Simon Sapper.
The TUC’s submission to the LPC (June 2019) called for a rate of £10 an hour as quickly as possible. It also argued that the full rate should extend to 21- to 24-year olds immediately and progressively to younger workers.
We have also lobbied the Chancellor of the Exchequer to go beyond the current NMW target. The government has announced an intention to ‘end low pay’ with a suggestion that this could imply a target of two-thirds of median earnings.
The TUC NMW Enforcement Group brings together unions, advice agencies, the Business, Energy and Industrial Strategy (BEIS) department, the Low Pay Commission (LPC), HM Revenue and Customs (HMRC), the Gangmasters and Labour Abuse Authority (GLLA) and the Director of Labour Market Enforcement. Some progress has been made on this agenda. Crucially, the amount of arrears recovered increased to £15.6m. With 439,000 workers underpaid, much more is still needed.
We campaign for a range of improvements, expressing strong concern that naming and shaming underpaying employers was suspended last year.
More positively, government has committed to extend the NMW to non-UK seafarers on ships working exclusively between UK ports.
Promoting the voluntary living wage standard was also a goal. Many trade unions use these rates (£10.55 in London and £9.00 elsewhere) in their pay claims. The number of living wage employers increased to 5,400 in the past year, up 25 per cent. The TUC took part in the Living Wage Week campaign (November) and campaigned to build support for the living wage. The general secretary sits on the Living Wage Commission.
The General Council’s work on social security has been guided by resolution 30, ‘Stop and scrap universal credit’, and resolution 29 on social security.
The TUC has been actively campaigning for universal credit to be stopped and scrapped. This included a submission to the Work and Pensions Select Committee on universal credit and in-work progression, and a parliamentary briefing for the upcoming discussion of managed migration regulations of universal credit in parliament. We have also provided regular updates on universal credit to unions and the Disabled Workers’ Committee.
We have continued to highlight the devastating impact of the cuts to the social security budget. Our work has also looked at the longer-term and how to build a radically improved social security system. We responded to the Labour Party Consultation on ‘rebuilding a just social security system’ and worked with unions on this. The TUC has also worked with the Fabian Society to produce a set of proposals for social security in the 2020s, alongside a wide range of organisations representing groups with an interest in the social security system.
TUC activity during this Congress year has been guided by resolution 7, ‘Just transition and energy workers’ voice’, resolution 8, ‘Fracking’, and resolution 9, ‘Strategy for a low-carbon industrial region’.
In July 2019, the TUC launched its just transition statement. This statement was developed by the Trade Union Sustainable Development Advisory Committee (TUSDAC) following consultation with trade union members in the energy and energy-intensive industries. The statement calls for a cross-party commission on long-term energy use, involving affected workers, unions, industries and consumers. It argues that workers must be at the heart of delivering these plans, including through just-transition bargaining at the sectoral level. Other highlights of the statement include a call for major investment in reskilling and ensuring that new jobs are good jobs, with terms and conditions at least as good as those in carbon-intensive sectors. The statement was launched at an event addressed by shadow secretary of state for business Rebecca Long-Bailey.
The TUC’s just transition statement calls for a cross-party commission on long-term energy use,involving affected workers, unions, industries and consumers.
The deputy general secretary of the TUC, Paul Nowak, and the TUC’s northern regional secretary, Beth Farhat, represent the TUC on the Institute for Public Policy Research’s Environmental Justice Commission, chaired by Ed Miliband MP, Laura Sandys and Caroline Lucas MP. The first meeting of this commission was held in June 2019.
TUSDAC has continued to advise the TUC on priorities relating to energy and climate change. TUSDAC has engaged with the Committee on Climate Change during this Congress year, lobbying that body to push for robust just transition policies as part of its call for a net zero-carbon economy by 2050. The TUC further made this case in a round table event organised by the Prince of Wales Corporate Leaders Group on net zero, chaired by Lord Deben, chair of the Committee on Climate Change. The TUC was represented at the Carbon Capture and Storage Association’s parliamentary reception in June 2019.
TUC activity during this Congress year has been guided by resolution 4, ‘Local casting’, and resolution 40, ‘Austerity, arts and discrimination’.
The TUC has continued to attend quarterly meetings of the Federation of Entertainment Unions, giving updates on TUC activity and responding to questions from FEU members.
The TUC has campaigned widely against austerity, including in the arts and cultural sectors. We have highlighted the effects of austerity on women, BME, LGBT+ and disabled people, as well as the effects on deprived regions and communities across the UK.
Over the last year the TUC has continued to be the leading advocate for the interests of working people in the occupational pension system.
The General Council has been a strong voice for reforms to improve pensions for the low paid in particular. In line with resolution 31, this has included working to close the loophole that denies pension tax relief to up to two million workers. This affects scheme members who earn below the £12,500 income tax threshold and whose pension provider uses a particular method – net pay arrangements – to deduct pension contributions. The TUC contributed to a joint letter to the chancellor calling for this loophole to be closed and has drawn attention to the problem in the national media. We have also worked with an industry group to draw up technical proposals to address the problem, due to be published in the summer.
The TUC has campaigned to lower the age threshold for auto-enrolment and to scrap the lower earnings limit, so that pension contributions are calculated from the first pound of earnings. Analysis published in February showed that delaying these moves – which the government pledged in 2017 to implement without setting out a timeframe – by just six years could reduce the value of a worker’s pension pot by up to £12,000. The General Council has also established a working group to bring together unions representing self-employed workers with DWP officials to explore ways of improving pension provision for this group.
In line with resolution 31, the General Council has continued to promote collective defined contribution (CDC) pension schemes as an alternative to defined contribution (DC). This has included responding to a government consultation on delivering CDC, organising meetings with the shadow pensions team on the subject and providing them with a written briefing ahead of planned legislation to enable CDC schemes.
The General Council continues to support defined benefit (DB) provision. This has involved responding to a government consultation on proposals to allow consolidation into profit-making ‘superfunds’ that would leave members exposed to serious conflicts of interest. The TUC has also continued to engage with the Pensions Regulator over concerns that its excessively risk-averse approach is encouraging employers to close viable DB schemes.
In the public sector the TUC has lobbied government over concerns raised in emergency resolution 8 that its decision to cut discount rates has increased the cost of pensions for employers. This was compounded by a decision in January to pause a process that was set to deliver improved pension benefits and lower contribution rates for public servants from April 2019 after the government lost an age discrimination case. The TUC has written to and met with the chief secretary to the Treasury to call for this process to be un-paused and for the cost of the reduced discount rate to be funded for all departments to 2023.
The TUC also secured a pledge that any changes to public sector schemes that are needed to remedy the age discrimination will be negotiated with unions, on a scheme-by-scheme basis.
The TUC’s annual pensions conference in February was well attended and included a keynote speech from the pensions minister. It also featured sessions examining the gender pensions gap, issues with pension funds investing in infrastructure and practical workshops for pension scheme trustees.
A revised UK Corporate Governance Code was published in July 2018. Its principles refer to stakeholders and the workforce and it includes a provision on engagement with the workforce. This represents a significant change from the previous version, which focused solely on shareholder relationships. However, the workforce engagement provision sets out three options that the TUC considers insufficient. The TUC described the revised Code as a “step in the right direction”.
The TUC was represented on a coalition group coordinated by the Financial Reporting Council (FRC) to advise on the development, for the first time, of corporate governance principles for large private companies. The Wates Principles, named after the group’s chair, were published in December. One of the six principles states that the board has a responsibility to oversee meaningful engagement with material stakeholders, including the workforce, and have regard to that discussion when taking decisions. Engagement with trade unions is referred to in the text. The coalition group remains in place to oversee the implementation of the Wates Principles.
The TUC submitted evidence to John Kingman’s review of the FRC in August 2018 and to the government’s consultation on the implementation of the review’s recommendations in June 2019. The focus of the TUC’s submissions was the importance of the FRC taking full account of the views and interests of company stakeholders, in particular the workforce, in terms of its remit, engagement and board representation.
In March, the TUC commented on the draft Stewardship Code, arguing that while the TUC supported the aim of setting higher expectations of stewardship, achieving this was hampered by the draft code’s lack of focus on the real-world impacts of investments. The response also argued that the code should promote asset managers allowing clients investing in pooled funds to direct their voting and require that asset managers publicly disclose all voting information. The TUC continues to be represented on the FRC’s Stakeholder Advisory Committee by Janet Williamson.
The TUC gave oral evidence to the BEIS Parliamentary Committee inquiry into fair pay in January. The Committee’s report, published in March, quoted from the TUC’s evidence and argued that companies should do more to link executive pay to workforce pay, recommending that remuneration committees should include an employee representative.
TUSO hosted a seminar for Amazon investors, focusing on employment practices and environment, social and governance shareholder resolutions filed at the company’s AGM.
The TUC has continued to coordinate Trade Union Share Owners (TUSO), an initiative bringing together union funds to collaborate over voting and engagement with companies.
In May, TUSO hosted a seminar for Amazon investors, focusing on employment practices and environment, social and governance shareholder resolutions filed at the company’s AGM. Speakers included GMB and UNI representatives and an Amazon worker who spoke anonymously for their job security. The seminar discussed Amazon workers’ experiences of health and safety, treatment of pregnant women, sexual harassment, pace of work and working hours.
TUC activity during this Congress year has been guided by resolution 1, ‘Industrial strategy: an economy for the many’, resolution 3, ‘Save our Steel’, and resolution 77, ‘Food security and sustainability’.
In December 2018, the TUC launched its new report, All Tomorrow’s Jobs. This called for a target for the creation of a million new manufacturing or high-tech jobs by 2030. We argued that sustainable industry and green technology could be one of the key planks of delivering these new manufacturing jobs. Priority policies to achieve this include making sure more government funding supports jobs, offering new skills to those at risk of industrial disruption, and strengthening union representation on sector deals. All Tomorrow’s Jobs was launched at a round-table event in Congress House and was reported in The Guardian.
In July 2019, the TUC launched a new report on ensuring that industrial change benefits workers, commissioned from the New Economics Foundation. This considered best-practice examples of cities and regions that have successfully managed industrial change. Based on case studies from Bilbao in Spain, Eindhoven in the Netherlands, and Iceland, the report set out a range of recommendations, including a lead role for unions in local industrial strategies and stronger public procurement policy.
The TUC has continued to engage with the Department for Business, Energy and Industrial Strategy (BEIS) on industrial strategy throughout this Congress year. Roy Rickhuss CBE, a member of the TUC General Council, sits on the Industrial Strategy Council. The TUC was present at ‘Industrial strategy: one year on’ event that took place in Bristol in November 2018 and which was addressed by the secretary of state for business, Greg Clark, and the chair of the Industrial Strategy Council, Andy Haldane.
The TUC has continued to work with Community, Unite and GMB in support of the UK steel sector. TUC General Secretary Frances O’Grady has raised on several occasions the crisis in UK steel and the need for robust government support with the business secretary, Greg Clark. The TUC was in attendance at the launch of the UK steel charter at the House of Commons in May 2019. We have continued to push the case for a steel sector deal with BEIS ministers during this Congress year.
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