Larger businesses are too often targets of enforcement, says government tsar

28 Mar 2019 By Lauren R Brown

Serious non-compliance over wages, equality and employment standards may slip under the radar as authorities target major retailers, suggests Sir David Metcalf

More can be done to protect the most vulnerable workers from discrimination, the director of labour market enforcement said yesterday, as he called for more cooperation between enforcement agencies.  

Sir David Metcalf (pictured) said it was possible authorities were focusing too heavily on larger employers when it came to tackling non-compliance around regulations including the Equality Act, health and safety or minimum wage rules.

He said while this focus was likely to reach the greatest number of people, it risked missing lower-volume, but potentially more serious, issues of non-compliance. 

“There have been substantial investigations into retail firms, so it may be that the more serious non-compliance is not getting enough resources,” he said. “It’s a question of whether it is the number of workers you should target or if you should be going for people who are earning less.”

He cited nail bars and car washes as examples of workplaces where non-compliance issues might be missed. 

Metcalf is the government’s first director of labour market enforcement, a role created to define and oversee the strategic priorities of the three main workers’ rights watchdogs: the Gangmasters and Labour Abuse Authority, the Employment Agency Standards Inspectorate and HMRC’s National Minimum Wage Enforcement Team.

Giving evidence to the Women and Equalities Committee (WEC) in its ongoing inquiry into the enforcement of the Equality Act yesterday, Metcalf touted the potential benefits of creating a single labour rights enforcement body – a suggestion included in the Taylor review and accepted as part of the government’s Good Work Plan.

Metcalf said one of the main benefits of a single enforcement body would be the creation of “one route in” for individuals looking to report a breach of regulations. But he said there was also the possibility of better collaboration between the bodies as they exist now. 

“Over and above the single portal, I think that if we can get improved intelligence and information sharing among the three bodies and with local authorities, we can make sure that the vulnerable workers do get looked at and looked after probably better than they have been,” he said. 

He added that although the existing bodies were good at responding to complaints, there needed to be more proactive investigations because “the most vulnerable workers are prone not to complain”.

Individual litigations, combined with a strategic regulator as the enforcement body, would be more effective, he said.

In response to questioning, Metcalf said he would be surprised if the majority of workers that suffered breaches of their rights, particularly around the minimum wage, didn’t also have at least one other protected characteristic.

To this, Jess Phillips, Labour MP for Birmingham Yardley, suggested a single enforcement body that looked at specific trends – for example of migrant women’s work or eastern European men’s labour – would potentially help throw better light on future strategies rather than just looking at all those who failed to receive the minimum wage.

Maria Miller, Conservative MP and chair of the WEC, added this approach could address the problem of limited resources as the enforcement agency would be targeting areas where issues like the minimum wage and equal pay were more likely to be found. 

Metcalf responded that “it takes you off down a slightly different channel” to what the three bodies had been doing, but that it was absolutely worth thinking about. 

A government consultation paper on the single body was expected to be published by Easter, Metcalf added. 

The WEC inquiry into the enforcement of the Equality Act was launched in July 2018, and aims to look at whether the act creates an unfair burden on individuals to enforce their right not to be discriminated against. 

Figures released by the TUC suggests there is large scale non-compliance with basic employment rights in the UK labour market, with up to 580,000 workers being paid below the national minimum wage.

Its analysis revealed at least two million workers were not receiving legal minimum paid holiday entitlements, missing out on £1.6 billion in paid holiday per year.

According to statistics released in September last year, in 2017/18 the government identified more than 200,000 workers who had been paid less than the minimum wage and were owed a total of £15.6 million in wages.

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