CIPD responds to The Conservative Party manifesto

Welcome steps on corporate governance and workers' rights, but questions remain over effectiveness of immigration and skills policy.

Commenting on the proposals set out in The Conservative Party manifesto, Peter Cheese, Chief Executive of the CIPD, the professional body for HR and people development, said:

“This is a wide-ranging plan that seeks to take positive steps to strengthen corporate governance, encourage people back into work, and help clarify the rights of workers, particularly those working in the gig economy. However, we are concerned about the detail of recommendations on immigration, skills and pay ratios, particularly the evidence base and practical implications in areas that are so critical to the UK economy.”

On immigration:

“It is disappointing that The Conservative Party have stuck to its plan to reduce immigration to the tens of thousands. The idea that there is an optimal level of immigration is a myth, and British business will suffer if they are not able to access the skills and labour they need. Furthermore, employers with skills shortages will not thank the Conservatives for proposing to double the cost of the immigration skills levy, which will make it harder to access talent from abroad.”

On executive pay:

“Only by increasing transparency in business can we help to rebuild trust, and also give employees a greater voice in organisations. We therefore welcome the proposals around annual shareholder votes on pay packages, as well as the requirement to publish pay ratios. However, it would be better if companies were benchmarked against their own median pay, rather than broader UK workforce pay, which risks organisations being forced to publish numbers that give no context to their individual reward strategy.

“Only by shining a light on executive pay within an individual organisational context can we provide greater transparency for employees and shareholders, and ensure that executives are more accountable for their performance.”

On skills:

“While we welcome the idea of a creating a national retraining scheme, we are concerned at the suggestion that companies will be able to use the Apprenticeship Levy to support wage costs as part of this initiative. A far better way to boost training opportunities for individuals and meet employers’ skills needs would be to reframe the Apprenticeship Levy as a more flexible training levy.”

On workplace diversity:

“We welcome efforts to help employers take on parents and carers returning to work. It is vital that organisations access the full range of talent available to them and reflect the communities and societies of which they are part. This means recruiting more people from all under-represented groups, from ethnic minorities to groups such as ex-offenders and former armed services personnel.”

On national insurance holiday:

“The proposed holiday from employer NICs to help disadvantaged people into work is well-intentioned, but evidence from previous similar initiatives suggests that it is likely to prove either wasteful or ineffective. A better way forward is to encourage more targeted and bespoke support to companies who might be persuaded to take more disadvantaged people on, especially if they fear the impact of Brexit on labour supply and want to develop alternative sources of less skilled labour from the domestic population.”

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