The next item of business is a debate on motion S6M-18075, in the name of Richard Leonard—sorry, Richard Lochhead; we need the summer recess—on a legislative consent motion on the Employment Rights Bill, which is United Kingdom legislation.
I invite the minister to speak to and move the motion.
15:51
Thank you, Deputy Presiding Officer. If it gives you any comfort in relation to getting our names right, you will not make that mistake after the next Scottish Parliament elections, because neither Lochhead nor Leonard will be here. [Laughter.]
I welcome the opportunity to debate the motion to provide legislative consent to provisions in the UK Government’s Employment Rights Bill. The Scottish Government is supportive of the overall ambitions of the bill. We have engaged fully and constructively with our counterparts on key measures, and we welcome the majority of the proposals, including those on which we have been listened to and in relation to which improvements have been made.
The bill puts on a statutory footing some of the progress that we have already made in Scotland, which, I would argue, vindicates our trailblazing fair work agenda. Notably, the Scottish Government was the first Government in the UK to become a real living wage employer. That was back in 2015. It was also the first Government in the UK to include criteria, including the real living wage, to address fair work as part of public procurement exercises, and—through fair work first—it was the first to include fair work criteria in public sector grants and contracts. More recently, we strengthened our approach by attaching fair work conditions to public sector grants.
There remains more to do, but, through fair work, we have made a real difference for employees in every sector of Scotland’s economy. Evidence shows that treating workers fairly and putting them at the heart of business is good for business. Scotland has the highest proportion of employees earning at least the real living wage, and the median gender pay gap for full-time employees is narrower in Scotland than it is in the UK as a whole—that has been the case since 2003. In addition, the fact that the disability employment gap has reduced over the past nine years shows that we are making good progress to meet the ambition of at least halving it by 2038.
Building on the progress that we have achieved through political will and action, the gains that the bill will undoubtedly make in relation to workers’ rights should be protected, not just for the duration of a Labour Government but beyond. We cannot rely on the good work of the current or future UK Governments in protecting the rights of workers in Scotland in the long term. That is why the Scottish Government remains firmly convinced that the best way to protect Scottish workers is through the full devolution of employment powers. I continue to welcome the Scottish Trades Union Congress’s on-going support for that position.
In the meantime, we have used the opportunity to work with UK ministers and officials to protect devolved powers and to seek to strengthen the bill’s provisions for all workers. Throughout the process, Scottish Government ministers and officials have continued to press for Scottish interests. As a result, the bill now confers some limited powers on the Scottish ministers. For that reason, the consent of the Scottish Parliament is required, first, for the provisions that relate to the protection of workers who are involved in public sector outsourcing, to address the issue of two-tier workforces; and, secondly, for those that relate to the establishment of a social care negotiating body for Scotland.
The Scottish Government has long advocated using the power of public procurement to drive fair work standards where that is possible and appropriate. The bill, as amended, includes the power to avoid a situation in which there is a workforce consisting of ex-public sector employees and private sector employees with each group on different terms and conditions, which would be a two-tier workforce. Scottish and United Kingdom ministers may specify in regulations the terms that a public body should ensure if it is awarding a contract that outsources the delivery of its functions or functions that were previously delivered by a public body. The bill also requires Scottish and UK ministers to publish a code of practice for public bodies in relation to relevant outsourcing contracts and to lay that code before their respective Parliaments.
The bill, at introduction, included provisions relating to the social care sector in England to establish a negotiating body, through regulations, to consider pay, terms and conditions for the sector. The outcome of those negotiations, once accepted by the Secretary of State, was to be enacted through regulations delivering fair pay agreements for those workers in scope.
The Scottish Government recognised the opportunity to underpin much of the work that has already been undertaken in Scotland on sectoral bargaining and secured agreement from the UK Government to have that part of the bill apply to Scotland. That will provide the Scottish Government with the option to regulate for negotiated fair pay agreements for the sector, as an alternative to a voluntary process. We also secured the broader application of those bill provisions to children’s social care services as well as adult social care services.
I look forward to continuing to work closely with the UK Government to build on our fair work principles and to help to maximise the positive impact of the bill across Scotland.
I draw Parliament’s attention to clause 47 and schedule 7, which were included in the supplementary legislative consent memorandum. On further consideration, our view is that they do not affect the competence of Scottish ministers and have therefore been removed from the motion.
I move,
That the Parliament agrees that the relevant provisions in the Employment Rights Bill, introduced in the House of Commons on 10 October 2024, and subsequently amended, relating to the protection of workers in relation to relevant outsourcing contracts (amended clause 30), and the establishment of the Social Care Negotiating Body for Scotland (amended clauses 36 to 46 and 48 to 52, alongside related amended clauses 153 and 155), so far as these matters alter the executive competence of the Scottish Ministers, should be considered by the UK Parliament.
15:57
Thank you, Presiding Officer, for the opportunity to speak to the legislative consent motion on the Employment Rights Bill, as convener of the Health, Social Care and Sport Committee. As members will be aware, on 10 June 2025, the committee published its report on the supplementary legislative consent memorandum as it relates to the bill. That was triggered due to the provisions in the bill regarding social care negotiating bodies, as well as various other amendments that fell under the health and social care remit. I am pleased to say that a majority of committee members recommended that the subsequent draft supplementary motion be agreed by Parliament. The Health, Social Care and Sport Committee recognises the importance of the bill and, more importantly, the need for comprehensive scrutiny of the provisions that require legislative consent.
Although employment law is a reserved matter, the provisions in the bill will have massive implications for Scotland’s workforce, particularly in social care. That is why we sought extensive evidence from stakeholders, both in written form and in oral evidence to the committee. To that end, I thank the Convention of Scottish Local Authorities, Glasgow City Council, Health and Social Care Scotland, Scottish Care, the Scottish Social Services Council and Social Work Scotland for their engagement on the matter. I give special thanks to the witnesses who gave oral evidence on 20 May.
Although I am unable to give a summary of the extensive evidence that was received regarding the supplementary LCM and the bill more generally, our report contains a comprehensive overview of the key points that were raised during those sessions. That said, one of the main themes that echoed throughout was the need for continued collaboration when it comes to creating an effective negotiating body for social care. As is highlighted in our report, members were keen to hear more about the on-going discussions with trade unions, as well as the work of the fair work in social care group. I am grateful to the then Minister for Social Care, Mental Wellbeing and Sport, Maree Todd MSP, and her supporting officials for speaking to the supplementary LCM and addressing the points that were raised by stakeholders in evidence to the committee.
Although union membership in social care currently sits at around 20 per cent of the workforce, concentrated largely among local government employees, the committee nevertheless welcomes the minister’s commitment to promote increased union membership across the social care sector as a means of improving terms, pay and conditions. That said, we note the minister’s comments that time must now be spent bottoming out the Scottish social care sector’s preference, be that a voluntary arrangement or statutory underpinning. We strongly encourage the Scottish Government to continue to do its best to seek consensus with relevant stakeholders, so that we can achieve better and fairer work conditions for those in the social care sector, which are arguably long overdue.
On behalf of the Health, Social Care and Sport Committee, I hope that the bill’s provisions will be a positive step in the right direction for Scotland’s social care workforce. I look forward to assisting further scrutiny in that area, where my committee’s remit is engaged.
16:00
During the previous debate, I observed that 11 members were in the chamber. I see that we have now increased that number dramatically—to 17. Such is the quality of the debate this afternoon that members are flooding in to hear our exchanges. I hope that we can improve that quality as we go on.
The legislative consent motion that is before us relates to the Employment Rights Bill, which, as we have heard, is UK-wide in effect. It is a wide-ranging piece of legislation that was introduced by the Labour UK Government, implementing plans that had been proposed in a Labour green paper published in September 2022. The bill covers a range of subjects, including the regulation of zero-hours contracts; greater rights for flexible working; removing the three-day waiting period for statutory sick pay; removing the qualifying period for paternity leave and ordinary parental leave; expanding eligibility for bereavement leave; providing employees with additional protection from harassment; and removing the two-year qualifying period for unfair dismissal claims.
Although Scottish Conservatives would agree with some of the measures that are set out in the bill, we have concerns about the overall economic impact of what is being proposed. Business organisations have expressed concern that the rules on unfair dismissal that it is proposed to change would make it less attractive for businesses to hire staff. One of the most vocal critics of the bill has been the Federation of Small Businesses, which has expressed concern about the impact, on smaller businesses in particular, of having to cope with 28 changes in employment law simultaneously. Similarly, the Association of Professional Staffing Companies has expressed concern that conferring day 1 rights would have adverse effects on recruitment practices for risk-averse employers, who might, as a consequence, look at methods of pushing those risks on to others in the supply chain, such as staffing companies. Those are the potential unintended consequences of the bill’s proposals.
Changes in employment law must strike a balance. On the one hand, giving greater rights to employees is generally beneficial. However, if that leads to additional difficulties for businesses in hiring staff, which make them reluctant to do so, the overall impact can be negative. We have to see that against a backdrop where Labour’s ruinous increase in employer national insurance contributions is already having a negative impact on the wider economy and on businesses’ ability to attract and retain staff.
As we would expect, the minister again set out the Scottish Government’s stated aim to see all employment law powers being devolved to this place. I understand why that is its position. However, that demand is opposed by business organisations across Scotland, which want to see a level playing field across the United Kingdom. That is particularly important for businesses that operate in all parts of the UK and do not want to run different regimes that apply to different members of staff. For an Administration that claims to support growing our economy, it is curious that the Scottish Government takes that particular approach when business is so firmly opposed to it.
The fact that Scottish Conservatives have concerns about the parent legislation is not, in itself, sufficient reason for us to vote against the legislative consent motion, so we will not do so. However, we have concerns that the legislation has been rushed through with insufficient thought and consideration of the wider economic impact. For that reason, we cannot support the LCM that is before us, but we will not oppose it.
16:04
I thank the minister, the committee and its convener, Clare Haughey, for their contributions to the debate. As Murdo Fraser rightly pointed out, the purpose of the Employment Rights Bill is to put into legislation the Labour UK Government’s plan to make work pay—a fascinating principle that underlies the suggestion that, by working, people can afford to live.
I thank Murdo Fraser for articulating many elements of the bill. I would add to his list the work to prevent fire and rehire, sectoral collective bargaining, which has been mentioned, introducing rights for trade unions for access to workplaces, repealing the Strikes (Minimum Service Levels) Act 2023 and some of the provisions from the Trade Union Act 2016, and bringing together the powers of existing labour market enforcement bodies along with other powers under the secretary of state and enforcement officers. I welcome all those elements of the bill.
I also welcome the approach that the Scottish Government has taken with regard to discussions with the UK Government. If the economy is to grow across the whole of the UK, with the greatest respect to Murdo Fraser’s contributions, it will be through the workers of this country. We will support the LCM this evening.
16:05
I thank members for their contributions.
I am responding in my capacity as Minister for Social Care and Mental Wellbeing, but in my previous role as Minister for Employment and Investment, I had considerable engagement with the UK Government, including with minister Justin Madders. I put on record that, although we were not able to reach agreement on some issues, we always worked in the spirit of not making the perfect the enemy of the good, and we took a very constructive approach. I know that my colleague Maree Todd, when she was social care minister, had a similarly constructive relationship with her UK Government counterparts.
On that topic, I refer to the contribution of Clare Haughey in her capacity as convener of the Health, Social Care and Sport Committee, and I underscore the constructive and collaborative approach that Maree Todd and I will take as we consider the potential utilisation of the new powers that will be conferred on Scottish ministers, subject to the legislation gaining royal assent at Westminster.
I welcome Tom Arthur to his new role. I have not had an opportunity to do that formally, and I welcome the approach that he will take to working with the committee.
I very much appreciate that. I look forward to engaging with the committee, particularly on its recently launched inquiry, and I look forward to constructive engagement with the convener. I emphasise my commitment to engaging constructively with the sector and all partners, including trade unions, to build consensus.
Members have made important contributions in the debate. With regard to what Martin Whitfield said about the fundamental purpose, reasoning and rationale of the legislation, we very much support that. As my colleague Richard Lochhead said, the legislation, in effect, puts on a statutory footing many of the policies that the Scottish Government has sought over the past decade, whether through its influence in its convening power or around conditionality and guidance on matters of public grants and procurement.
Although I take a different position from Murdo Fraser’s, he is right to raise the concerns that have been expressed by business. It is important that those concerns are raised, because it is a reminder to us all to implement legislation constructively and to communicate it clearly. That is vital, particularly given that much of what will follow from the bill will come through guidance.
The bill is important for us as a Parliament because, although responsibility over nearly all of employment law is in effect exclusively reserved to Westminster, it will have significant implications for the Scottish economy. The implications, I think, will be positive, but it is important that we engage constructively with the UK Government as it takes forward those provisions.
The Scottish Government’s position is that employment law should be devolved to the Scottish Parliament. I note that that position was previously supported by the Labour Party in a motion in 2023. Although we are now in a position of alignment in wanting to advance workers’ rights, we cannot take that for granted. British politics has always had one certainty, which is that Labour Governments have been followed by Governments of a different political hue. That has previously been the Conservatives, but it might not be the Conservatives next time; it may well be a party that is not aligned to the values that command majority support in this place with regard to workers’ rights.
That is why it is of paramount importance that we secure the devolution of employment rights to this Parliament, not only so that we can protect and embed those rights and guarantee them so long as there is a majority for them in this Parliament, but so that we can work constructively and proportionately with others to enhance those rights. Fair work is not only good for workers and not only a social and moral imperative; it is good for the economy. Ultimately, workers are also consumers, and the more security and fulfilment that they have in their work and the more disposable pay that they have, the better it is for businesses and for workers’ dignity.
It is also good commercially for businesses, because a workforce that is invested and that feels secure, fulfilled and respected will be more productive and will make more of a contribution to their employers. Those matters are of fundamental importance to the wider Scottish economy, and they underscore the importance of our constructive and collaborative approach with the UK Government in taking forward the LCM. It also underscores why the Government thinks that we should be looking to devolve employment powers to the Parliament in full, which would enable us to guarantee and protect those rights for all time, as long as there is majority support for that in the Parliament.
We would have liked the UK Government to go further on some measures, such as sick pay. It would also have been beneficial if we did not require the consent of the secretary of state on provisions relating to the social care negotiating body. Again, that underscores the importance of having employment law devolved to the Parliament.
As I said at the outset, we did not approach this with the intent of making the perfect the enemy of the good. We have worked constructively, and I believe that the LCM is a positive step forward on the road to the full devolution of employment law to the Parliament in due course.
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