Updated Fair Work First Guidance

By Marek Zemanik, Senior Public Policy Adviser

The impact of the pandemic on nearly all aspects of our personal and working lives will be felt for years to come. In the world of work, both employees and employers had to quickly learn to navigate new challenges, with more to come as we apply the lessons of the pandemic to a ‘new normal’. But where there are challenges, there are also opportunities. One of these is embedding flexibility – over when and where we work - into many more working lives. 

The Scottish Government should be commended for putting fair work at the heart of its response to the pandemic from the outset. What is more, it has now started to reflect the pandemic in its official guidance in relation to the Fair Work First policy - the Scottish Government's approach of applying fair work criteria to grants, other funding and contracts being awarded by and across the public sector. From its inception, Fair Work First guidance asks employers to adopt these fair working practices: 

  • appropriate channels for effective voice, such as trade union recognition;
  • investment in workforce development;
  • no inappropriate use of zero hours contracts;
  • action to tackle the gender pay gap and create a more diverse and inclusive workplace;
  • payment of the real Living Wage.

Following the pledges in the 2021 SNP manifesto as well as the First Steps document published after the SNP’s election victory, Fair Work First guidance was expanded last month (October 2021) to include two new criteria: 

  • offer flexible and family friendly working practices for all workers from day one of employment; and
  • oppose the use of fire and rehire practice. 

The CIPD was delighted to support this work in the run up to its publication and provided evidence across both new criteria. 

We strongly welcome the additional focus on flexibility. One of the most direct impacts of the pandemic to our working lives was the significant shift to homeworking for those whose jobs can be done remotely. Evidence from other CIPD reports suggests that homeworking is here to stay to an extent. That being said, it is important to emphasise that government-mandated homeworking has not been a universally positive experience – not everybody has the resources or space to work from home, nor is it everybody’s preference to do so.

It was therefore important to ensure that the guidance reflects this and did not simply equate flexible working with homeworking. Indeed, we know that there are clear gaps in Scotland when it comes to flexible work. Our evidence shows that while Scotland does well on flexibility “over where”, it does comparatively poorly on flexibility “over when”. Furthermore, UK-wide official data shows that while homeworking increased, all other forms of flexible working have seen a drop during the pandemic. 

The guidance makes it clear that a commitment to flexibility starts before employment and that job adverts (and indeed job roles) should be designed with this in mind. It should be available to staff at all levels and across the organisation, with constructive conversations about flexibility. Furthermore, the guidance makes it clear that IT equipment and broader systems and protocols should be updated to reflect more flexibility, with no invasive monitoring software. 

CIPD reports and resources are linked in throughout, which is positive recognition of our increased public affairs and policy activity in Scotland. We will continue to make the case for more support for line management training – crucial to all aspects of job quality - as well as challenge funding to support creative flexible work approaches across sectors. 

The second new criterion in the updated Fair Work First policy is around fire and rehire. While there is no agreed definition of this practice in employment law, it is most commonly seen as a means for employers to change the terms and conditions of employment to the detriment of the employee. Also known as ‘dismissal and re-engagement’, it is not illegal, but it has recently received more attention due to the rapid changes to business models we have seen during the pandemic. 

The government’s guidance makes it clear that whilst fire and rehire practice may not in all circumstances be contrary to employment legislation, it does not align with the principles and expected practice of Fair Work. Therefore, an employer wishing to access public sector grants or other funding (or to deliver a public contract) will be expected to commit to not using fire and rehire practice. This will be monitored during the life of the grant, with the possibility of discontinuation and an impact on future requests (where relevant and proportionate). 

Changes to employment contracts are not unusual, but are most commonly done in consultation and with agreement of the employee. CIPD evidence suggests that one in five employers (22%) have made changes to employees’ terms and conditions of employment between March 2020 and July 2021. It is important to emphasise that not all of these were negative changes – the most common change was to location of work, with 50% of those who changed pay actually having improved it. 

While 19% of employers changed terms and conditions through consultation, negotiation and voluntary agreement, 3% - the equivalent of 42,960 employers in the UK business population - did so through dismissing staff and rehiring them on new terms. While this is a very small proportion, the CIPD published guidance with the aim to reduce this number even further. Our view is that these practices should only ever be considered as an absolute last resort if changes to employment contracts are critical and voluntary agreement is not possible. 

We were pleased to pass on these findings to Scottish Government officials and contribute to guidance around this Fair Work First criterion too, which now also includes a link to our own CIPD guidance. 

There are other issues linked to the fair work agenda that the Scottish Government is planning to do more work on – most notably around the new Living Hours Accreditation Scheme (mirroring the Living Wage campaign, but focusing on hours worked) and its 4-day-week pilots. Our evidence and constructive insight across these areas will hopefully continue to make a useful contribution.

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