Date: 05/04/11 Duration: 00:28:35

In this podcast Lynne Featherstone, Lib-Dem minister for equalities, Julian Smith, Conservative MP for Skipton and Ripon and Dianah Worman, CIPD’s Diversity Advisor discuss fairness at work, the Government's role in driving it and what is needed to ensure it happens.

Philippa Lamb: The Coalition Government is nearly a year into the job and one topic that’s repeatedly cropped up in the past 12 months has been fairness at work.

Last year’s Equality Act, the proposed abolition of the default retirement age and the ongoing debate over flexible working have all grabbed headlines. We saw more on this in the Budget and with me to discuss this particularly hot topic I have three guests who all have strong views about fairness at work and the government’s role in driving it.

Lynne Featherstone is the Lib-Dem minister for equalities, Julian Smith is Conservative MP for Skipton and Ripon – he lead a review into business regulation before his election to Parliament last year – and Dianah Worman is the CIPD’s own Diversity Advisor and an international expert in the field.

Lynne Featherstone let’s kick off with a quick definition. How would you define fairness at work?

Lynne Featherstone: I would define fairness at work as you being able to get on and do your work and be promoted and earn a living regardless of where you came from, what your parents did, what you look like or whether you have children.

PL: Dianah, I think we can all agree can’t we, it’s desirable. Fairness is desirable in a civilised society; is there a business case for it?

Dianah Worman: Absolutely there’s a business case for it and we would include the issue of litigation and complying with the law on that because of the damage to public reputation but absolutely there’s a business case because the fairness at work agenda is key to helping people to perform better. So, sustaining high performance depends on fairness at work.

PL: Julian Smith, is there an argument for saying that tackling discrimination is a zero sum game, that equality for one group necessarily comes at a cost to another?

Julian Smith: No I don’t think there is. I mean I agree with everything that Lynne said, I think the point that I’ve been making in parliament over the last ten months is that at a time of significant economic challenge we’ve got to balance the obvious unfairness that is going on for many groups in our society with a need to create jobs and to grow our economy.

PL: Dianah, causes; the driving forces behind creating a fair workplace – what do you say?

DW: I think one of the challenges we have to deal with is the way all of us stereotype people and the key issues about gender and disability and race are the things that everybody notices and cause serious problems but all sorts of other stereotyping gets in the way. So, the way we behave at work is vitally important and understanding how to deal with that and respond to it is key and law is an enabling framework that should help us to make some progress but won’t deliver all the answers.

PL: Okay, I mean Lynne, as Dianah says, law it’s there but who should take primary responsibility for fairness, is it government or is it employers?

LF: It’s all of us actually. Obviously the government can lay out the frameworks and make laws that control some parts of business but ultimately any sensible business will be doing what we are suggesting in law anyway because we know that equality in the workplace promotes better business and if nothing else would persuade business to understand the need for equal treatment and equal opportunity is that it ups the bottom line.

PL: Julian, you’re a champion of small business and you’re known for your opposition to red tape so would you agree with that?

JS: Well I think the issue for small business is they often don’t have a human resource department, they have limited capacity in terms of advice and they often don’t have the pounds to spend on legal help. My message on small business or my request to Lynne and her colleagues in government is that there is a special case for small business, and especially micro-businesses of under ten people, and there is an argument for these types of businesses that some of the things we’re trying to achieve should be dealt with in a more informal way and some of the procedures could be put in place in a way that allows small business to take the decisions that they need to.

PL: So in your terms was last year’s Equality Act bad for those smaller businesses?

JS: I don’t think it was bad but I do think when you look at that Act, when you look at government legislation across the piece from the position of being a very small business, maybe running a shop, running a pub, it’s very difficult to access it and it takes an awful lot of time.

PL: Lynne, special case?

LF: Well Julian should be very pleased because thanks to much of his work I suspect there is something called the Better Regulation Committee when you put a legislation through and it is murder getting things through the Better Regulation Committee. So, the nine-tenths of the Equality Act that came in that I commenced in October we had to prove that we were taking out nine pieces of regulation for every one we were putting in, that was a simplification. In terms of the special case, yes we have been listening to that argument about particularly small businesses, the consequence of which is that the government have announced that there’s a moratorium for three years on further regulation to small businesses, what is already in place stays in place and that’s just being finalised and finessed at the moment. I used to have a small business myself and I can understand that you don’t have the resources of a big business, nevertheless you will still do better if you apply the equality principles to a small business as well as a big business.

PL: I mean what do you think, Julian, do you think that moratorium going to be enough to pacify the business community, particularly the small business community?

JS: Well I think it was a great move last week announced last week by the Chancellor in the Budget and I think this concept of principles is something I really agree with because I think it is on a number of these issues trying to talk about principles and talk about the aims of what we’re trying to do but not necessarily legislate to the nth degree and I think it’s that sort of transition between what we’re aiming to do and actually how it’s legislated and how that comes down in guidance to small business that can be a bit of a challenge.

PL: You feel confident that guidance would actually get the job done?

JS: Well no I think there should be clear law on equality but I think how that is translated into guidance, into messages for business has to take into account limited time on behalf of business owners.

PL: Dianah, we saw the provisions of the Equality Act tweaked in the Budget didn’t we, this dual discrimination claims thrown out, now I think I’m right in saying most of those multiple strand cases include race so does this more clearly it supports growth but does it push back the race equality agenda do you think?

DW: It depends how you communicate that message really. It’s the messaging that’s very important and you don’t want overcomplicated prescriptive legislation that’s true, I think the principle base approach makes sense and a lot of small employers in particular do do the right thing, which is good news, but I think they need clear signals about the values and the principles because the whole agenda is a value driven approach and that’s what supports fairness at the end of the day. I think removing the finessing has to be communicated in the proper way so we don’t suggest it doesn’t matter anymore. These things will happen anyway and the law won’t stop these cases being taken forward but it will just take longer if people feel they’ve been unfairly treated on the basis of a number of different issues/characteristics.

PL: Was that the right way to go do you think, Julian?

JS: As I say I think it is about simplicity, making things as simple as possible and also it’s about trust. Many small businesses actually have great relationships with their employees. I had a small business which employed only women and the most successful relationship I had in terms of a staff relationship was one where I could speak to one individual about her child plans and her plans for a family and we had an open discussion and we were able to interweave her plans with our plans for the business. I think it’s trying to drive this agenda but also trust business as well and I think that combination is difficult and there’s going to be a tension there but I think my only request is for government to trust the business owner as well.

PL: What do you think about that Dianah, because clearly employers cannot have those discussions with their female employees right now, should they be able to?

DW: Well I support what Julian is saying. I think the only way forward on this very complex agenda is to encourage dialogue and getting people to talk to each other because that’s what helps us to understand how everybody feels and also the challenge should be to have solution focused conversations which suit the needs of the person and their business and if you don’t go into that space you’re not going to be successful because law can’t prescribe every eventuality, there’s no way it could ever do that.

PL: But didn’t the Equality Act make that more difficult to do?

DW: Well I think it depends on the confidence of the employer and the individual in talking to each other. If you have a lot of confusion about political correctness and so on then you may have this lack of trust and everybody would be scared to talk but we’ve really got to break that down because we live in the 21st Century now and we’ve actually moved on on this agenda. Even though people might feel they could get it wrong I would say we’ve got to try and have a go and take a risk otherwise progress won’t be made.

PL: But Lynne, don’t you think employers are really exposed now if they try and do that, if they try to be brave and approach their employees and have conversations like that? I mean there is a real danger for them isn’t there.

LF: No I don’t think so and I think the whole of this governments’ push is to get things back to a commonsense level where you can have these conversations and you won’t be found to be breaking the law if you have them. The many roundtables I’ve sat at and listened to conversations it screams out at me that employers who do well are those who actually care about their employees, talk to them, understand their circumstances and funnily enough it’s easier in some cases (and you almost always find it with small businesses) where that sort of flexibility and understanding of the responsibilities people have in their lives or life events that come into play are understood. By understanding and allowing and encouraging that you get an employee who is determined to work and do their best for you so it’s a win-win situation and it can’t always be done by law but I think the law sets the atmosphere and the framework and it’s very very important for that to be the case. I think where it’s been used wrongly or like with the discussions we’re having today ‘doesn’t it cause a problem?’ actually it doesn’t if it’s used properly.

PL: Let’s move onto government cuts in the public sector. Given the proportion of women employed in the public sector this is bound in some ways to drive inequality, how is the government going to offset that?

LF: Well I think the government’s done probably more than most governments to understand the impact of the cuts and in terms of the public sector actually the pay freeze at £21,000 for employees in the public sector means that most of the people who were protected were women and in fact in the Budget it was announced that those people will be getting a pay rise as opposed to the rest and that will effect women. I think the government has moved quite a long way to try and understand, along with loads of other measures that the government has done like the re-linking of the pensions link with earnings, which mostly benefits women, taking the lowest paid out of tax by raising the threshold which has happened in the last budget and this budget that takes mostly women and black and ethnic minorities and people with disabilities. Those are the people who are being helped by the Budget.

PL: Dianah, do you think government’s gone far enough?

DW: Well I think this situation does point to the importance of having balance in your workplace because if you don’t you’re going to get an unfortunate consequence for one particular group of individuals and that is just bad news for the nation and it’s bad news for the business so if you’re in the wrong place you’re in the wrong place and in the future you’ve got to make sure you take steps to not be there, to be in a better place. I think if there are needs for cuts and it’s going to affect more women and men simply because of the proportions of women in the public sector, there isn’t an easy answer on this so I’m not really sure if there is a quick fix.

PL: We’ve seen the Coalition backtrack on extending the right to request flexible work haven’t we, that was due to come in April this month, the earliest possible date now I think is 2013 isn’t it, what’s your feeling about that?

DW: Again we’ve always maintained that an inclusive approach to flexible working is vitally important because from my perspective the future of business has to be their agility to respond to the massive change that’s going on all around the world and most of the businesses in the UK have some connection in the global space. So, flexibility and the response levels is vitally important for business so we need to learn about how to deal with it. Again it’s the communication piece that’s the problem. If we’re saying that we can put this on the backburner through the law that could give some employers the view that they needn’t respond to this agenda, whereas others will just take off and go into their stratosphere because they know it’s the sensible thing to do and they’re learning all the time. Those that actually are hesitant will actually miss out in the long run and that’s the problem we have, especially if we want to make sure UK Plc is going to have good productivity then the messaging about flexibility needs to be ‘go for it because it’s in your best interests to do exactly that’.

PL: What do you think, Julian, do you think that message has got home, particularly for the smaller end of the business community; surely if they don’t have to introduce more flexible working they’re just not going to are they?

JS: No not at all and I think the message is getting home but it has to get home faster. If you look at the Report by Lord Davis and the appalling statistics there of how many women are on Boards, on FTSE250 and FTSE100 Boards there’s a lot of work to be done but I believe that that doesn’t always have to be done by lots of changes to law, particularly at the moment where we really need jobs. My concern at the moment is this year, the next couple of years is we need jobs, we need to get these women and men who’ve lost jobs in the public sector into work, that has to be the priority. Are there ways with legislation in that interim period to show best practice, to show examples and really to push this agenda but maybe not with frequent law changes in this particularly sensitive period.

PL: You mentioned Lord Davis’ Report on women on Boards, I take it you didn’t feel his recommendations were tough enough.

JS: Well I liked the fact that he decided not to legislate but as I said in a debate last week in parliament I think we’re in the ‘Last Chance Saloon and it’s going to be very difficult for people like me who advocate less regulation to stop future legislation in this area if we don’t deal with it. I think we’ve got a parliament basically to address this issue. I think it possibly could have been a little tougher with my old profession of head hunting that’s a very unregulated area; I think there’s a lot more that that sector can do in this agenda.

PL: Yes I mean for those who don’t know, Lord Davis’ suggestions were about targets really, there was no suggestion that companies would be forced into adopting more women as Board Directors; did that go far enough Dianah do you think?

DW: Well we certainly wouldn’t support quotas because it wouldn’t work on its own. This is a very complicated issue.

PL: Why won’t it work?

DW: Well because there is a lot of issues going on underneath all of this agenda and just fixing it with numbers isn’t going to sustain the permanent change and when we look at the challenges of a board room occupation its complexity regarding the culture and the expectations of the individual, they’re time poor and having reflection time is a key issue as well. We can’t fix it quickly, there needs to be a lot of other supportive interventions to create the right atmosphere at that level to be successful and that build takes time so I think organisations will need, again, a lot of support, a lot of guidance, a lot of discussion, a lot of networking to actually create the changes that are important. We know already that organisations that are heavily committed to achieving change find it really jolly hard to achieve sustainable success. It’s easy to lose a 1% gain when one person leaves so we have to be very supportive of these organisations, with lots of guidance and lots of information.

PL: What do you think, Lynne, are we going to see a different situation, a very different picture with women on boards in 10/20 years time or not really?

DW: We’d better.

PL: But will we?

LF: I think we will. Actually, no I’m out and about, talking to huge groups of women and male leaders of the massive companies and there is something in the air if you like. There is so much work going on in the networks and amongst senior leaders and with Lord Davis’ Report the pressure is becoming unsustainable and Lord Davis is going to meet every six months to review the position so there’s no let up. And, of course, the stick is somewhere in the background as Julian gracefully refers to it.

PL: The possibility of legislation.

LF: It’s a time limited offer at this point so they’d better move on it.

PL: Julian, what about the default retirement age? What is your feeling about that, with your business community hat on?

JS: Well as somebody who employed until recently an 85 year old it’s an interest that’s close to my heart. I mean I do think that change is a major challenge for business but it’s something I suspect that you and your colleagues at the CIPD can help with because I think it does come back to how do you manage your staff. I mean a lot of businesses are all concerned now on how do you exit staff and I think it will put a lot more pressure on businesses to performance manage and to have much stronger performance management in place, which by the way I think would be very helpful on the equalities agenda as well.

PL: But aren’t you taking a very liberal view compared to most people running businesses?

JS: Well what I was going to say was I think again the removal at this time is a big challenge for business and it’s something that I’ve had lots of representations about.

PL: Negative ones I take it..

JS: Yeah, well I think just people feeling that was a clear opportunity to say goodbye to an employee and that’s no longer there and I think we will need to help or give guidance to those companies who are dealing with quite a substantial change.

PL: Dianah, it’s been very unpopular hasn’t it with a lot of people.

DW: Well with a lot but also it’s been welcomed by a lot and the use of the DRA was actually not as high as one might have thought and a lot of organisations operated without compulsory retirement because they needed to keep the talent in their organisation, particularly small businesses, and as you’ve already said they can flex very much more quickly. I think again the removal of the DRA is absolutely important, the pressing need for change because of the demographic, the talent agenda and so on, we just have to go there and we can’t afford to hang back on it. I think the fear factor about performance management is there but you can’t encourage organisations to let that continue. It’s not in their own best interests so again the guidance, seeking advice and the sharing of how to do it perhaps for those that are worried is really the sensible way forward.

PL: Lynne, let’s shift onto gender pay reporting. Now I think it’s fair to say you’ve changed your position on this haven’t you? Pre-election you were all for it, not any more.

LF: Absolutely, I have changed my position.

PL: Why?

LF: Well we’ve moved into an era where we try and get people to do the right thing because it’s the right thing but it’s a time limited offer too. We’ve said we won’t commence, repeal or amend Section 78 of the Equality Act, that’s a clause which would make it compulsory to report and we’re working with business, with the unions to try and come forward with voluntary pay reporting and we’re going to monitor each year how many companies are coming forward and are reporting. If there’s no movement then obviously we’re going to look at the stick but it is in their interests. One of the things that happened under the Equality Act is we removed gagging clauses so people can now talk about their pay, which would probably be an eye opener for many people, but we have to narrow their pay gap and we have to be able to see what that is in companies. My advice to business is to come forward and report because it’s not about punishment. I think there’s a kind of an idea that is somehow if we see what’s going on that will in some way punish companies. The idea is just to see and to watch their improvement in this agenda because as we’ve proved and as the OECD says and the World Bank it is in business interests to close the agenda payback. It will improve both the economy of the country and the economy of that business. So, on best behaviour but we do expect them to move.

PL: But it’s been in the interests of business for a long time but it hasn’t made much difference has it.

LF: Yeah but the pressure is mounting. Again, in all of these areas it is ‘Last Chance Saloon’ and I think at this moment in time this is the right way forward but as you say I rightly believe that there comes a point at which you have to intervene, so I’m watching.

PL: What do you think Dianah?

DW: Yes, I think that the mood music has changed a little bit on this agenda because where we had a lot of positive views from some of the stakeholders to work together, I think they’re now thinking there’s a bit of space let them dig their heels in and not go for the change that’s so important and I think in moving forward on the reporting agenda we need to make sure we have issues that are important to achieve that change and not just frills that are cosmetic. So I think keeping this conversation going and getting people onboard again is something we’ve got to achieve. The successful organisations so far do it because it makes sense and again it’s actually communicating that value to those who are concerned that is key. So again it’s a communication message.

PL: Lynne, this is an interesting one. The issue around the messages – this is recruitment really. The messages that employers subliminally take from candidates names and the fact that people with what one might loosely, very loosely call foreign sounding names find themselves discriminated against. We’ve got research on this now from DWP, I think I’m right in saying you’re a fan of the idea of job application by National Insurance number, is that right?

LF: That was my idea so yes I’m definitely a fan of that and I’m promoting it across government at the moment and we’re having those conversations.

PL: And how’s it going down?

LF: It’s going pretty well actually. I think the work for anyone who doesn’t know that the DWP did, was to send out 3,000 applications to advertise jobs in the City but send twin applications – one with an English sounding name and one with a foreign sounding name – and no surprise really it took nine applications for an English sounding name to get an interview and 16 for a foreign sounding name so case made really and I’m pushing it.

PL: Julian, happy with that?

JS: Well I think this is where consensus may break down because I strongly believe that we have to have balance between trying to address these major issues of inequality with trying to go with the grain of human nature. I think the grain of human nature is you get a CV, you want to know a name and—

PL: Why?

JS: Well because you’re making an application for a job.

PL: I’m sorry, I’m not clear on that. Why does it matter?

JS: Well because if you are interviewing somebody, I’m making an application to you and I think my name should be on it and I think many businesses would agree with that.

PL: Lynne doesn’t look like she agrees.

JS: You look surprised but I think it’s a false surprise.

LF: I think Julian’s absolutely right, I think people do read a huge amount from a name and that’s why they feel uncomfortable about not having a name but that’s why it’s so important, if you like, to remove the name. The work done in America, what they discovered, you know this isn’t about overt racism because if you get through to an interview and you’re interviewed by a racist you’re not going to get the job. This is about the way the brain works and subliminally rejects that which is unfamiliar and accepts that which is familiar. So obviously in this country a foreign sounding name is more likely to be rejected than an English sounding name and that’s what the work the DWP did actually proved so I think it’s very important. It’s something that can be done that doesn’t cost anything so I would have thought you’d have been very in favour and it’s not really regulation, it doesn’t change anything, you just use your National Insurance number for example instead of your name.

JS: And then how will it work with peoples’ education background? So if I’ve been to a girls school will that then have to be removed?

LF: We’re looking at removing schools too because there’s been so much emphasis on where you came from, what school did you go to? The idea is you’re there on your merits alone, on your actual attainments, achievements and experience in life, that’s what should get you an interview. Once you’re at interview you’re in a whole other board game in terms of what people read from you.

JS: It’s an interesting point because as a head hunter and professional recruiter by background my message back would be there are these various things such as nameless CVs but ultimately if there’s prejudice and if there’s employers who drive an unequal agenda to their hiring they will do that and what we’ve got to do is try and address that root cause and I think if we go too far with sort of incremental measures to address it we may not actually address the root cause and I think we’ve got to focus on the root cause of why some employers are hiring in an unequal way.

PL: I wish we had more time to chew that one over but we’re almost out of time. I’m going to wrap this up with just a quick fire round of particularly knotty problems; I would like yes or no from all of you please on these. Dianah, should we introduce compulsory quotas for women on Boards?

DW: No.

PL: Lynne?

LF: No.

PL: Julian?

JS: Definitely not, at the moment.

PL: I like the caveat at the end! Maternity pay is too generous, Dianah?

DW: Wow, this is an interesting conversation. I think we can’t avoid tackling this issues of paternity, paternity pay and enabling both parents to care for the offspring.

PL: That’s not a yes or no answer.

DW: I think we have to review it and make sure that it delivers what we want it to deliver and I don’t like the conversations which suggest women cost too much but I don’t like either is the fact that we have this agenda of, particularly we know this from research, that we won’t employ a woman she’ll have children and that still prevails even now.

PL: Lynne, can I have a yes or no please?

LF: No but I think shared parental leave will help enormously because employers will not be able to predict which of their employees will take time off for child bearing responsibilities.

PL: Julian?

JS: Can you re-read the question?

PL: Maternity pay is too generous?

JS: No. Actually can I just add that one inequality I believe there is is that at the moment women in the City are able to get part of their maternity pay based on their million pound bonuses and I do think that is an inequality for low paid workers who are subsidising City workers.

PL: So much more to talk about. I’m really sorry we are close on time but one final yes or no, should we scrap the Equality and Human Rights Commission? Dianah.

DW: No.

PL: Lynne?

LF: No.

PL: Julian?

JS: Not at the moment.

PL: And there we have it. Thank you very much for that fascinating discussion, I have no doubt we’ll be back to these issues again but that is all we have time for today. Many thanks to Minister Lynne Featherstone, MP Julian Smith and Dianah Worman of the CIPD.

Next time we’ll be looking at another contentious subject, what are social media like Facebook, Twitter and Linked In really doing for learning and development? Join me then.

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