HR priorities for next prime minister

Today, Liz Truss became the new leader of the Conservative party and the prime minister of the UK. Here we examine which HR issues should be at the top of her agenda.

Address the cost of living crisis 

A combination of record levels of inflation, Bank of England interest rates and a surge in energy prices have created the worst cost of living experienced in the UK in decades. 

Peter Matejic, head of analysis at the Joseph Rowntree Foundation said the government's initial efforts to tackle the issue have been insufficient.

He said: "The situation is dire for families already in extremely difficult circumstances. The government’s cost of living support will not plug the growing gap between incomes and the amount families require to meet their minimum needs.

"In order to move us closer to a society where fewer people fall below the Minimum Income Standard, the government must reform our social security system to ensure that everyone can afford the essentials and, more broadly, what the public think is needed to live in dignity."


Further support is expected from the government, but until then here's what HR can do: 

How can HR help employees in fuel poverty?

How can HR help employees in fuel poverty? Part two

HR needs to do more to help employees during the cost of living crisis

How should you talk to employees about the cost-of-living crisis?

Strike action

Earlier this year HR was urged to prepare for a summer of strikes as employees across many sectors, including barristers, journalists, rail workers, the Royal Mail and airport staff, were all set to strike.

In July 2022, the government replaced Section 7 of the 2003 Conduct of Employment Agencies and Employment Businesses Regulations, which previously prevented agencies from supplying workers to an employer to perform the duties of a striking worker. 

Rather than making it legal for companies to bring in agency workers to cover striking staff, the government would be better served addressing the issue at source. 

Perry Timms, founder of consultancy PTHR, said the issues were of the government's making.

He said: "The government could have averted this current round of actions and withdrawal of labour.

"Many of us can see that what is being asked for is not outrageous demands: it is fair and appropriate income, conditions, and exchanges between high-profit enterprises and their underpaid people."

Back to basics on industrial action: 

What a good relationship between HR and unions looks like

How to break the cycle of stress and conflict in times of crisis

Employee relations to enter new era of instability


Skills shortages 

Despite the UK being in a state where job vacancies are exceeding the rate of unemployment, many businesses are still struggling to plug skills gaps in their workforce.

Chris Gray, UK director at ManpowerGroup, said that both businesses and job seekers alike are drawing the short straw

He said: "The current economic climate is putting a strain on both employers and candidates.

"As a result we have seen an increase in job hopping, as candidates look for salaries that will sustain them during these unprecedented times of inflation."

Tips for plugging talent gaps:

The Body Shop to recruit on first-come first-serve basis

Employers ditch skills requirements to find the right candidate

Rising cost of job ads calls for a recruitment rethink



IR35 tax regulations first took effect in April 2021, seeing employers become responsible for assessing workers' employment status, and therefore handling all tax and national insurance (NI) contributions for self-employed contractors and agency workers.

During her campaign, Truss pledged to review IR35 to account for the fact self-employed workers are not entitled to some of the rights of being a full-time employee, such as paid holiday. 

In May 2022, the Public Accounts Committee published its report into IR35, which said HMRC was not doing enough to understand the impact of the reforms on workers and labour markets.

HMRC responded on 2 September 2022 saying: "HMRC will expand its work to obtain customer insight, for example by collating outcomes from its existing compliance work to identify common issues, and by building on existing engagement with representative bodies and via the department’s network of customer compliance managers. It will consider what additional customer support is required depending on the outcome of this work"

Seb Maley, CEO of insurance provider Qdos, slammed HMRC's response.

He said: "Ultimately, this response lacks a concrete promise to resolve several of the fundamental issues resulting directly from the introduction of IR35 reform – whether that’s to ensure contractors have a fair shot at overturning unfair IR35 determinations or to give businesses every chance to comply with the rules.

“It’s a disappointing - albeit predictable - response that we’ve seen far too often from the government whenever it’s pressed on IR35.”

The challenges of IR35:

Umbrella firms trigger storm warnings

IR35 and zero-rights employment continues

IR35: off-payroll one year on



Employment Bill

The Employment Bill, designed to strengthen worker's rights around negotiating pay and joining trade unions, was first promised in the 2019 Queen's Speech. The fact that the bill was omitted from the speech this year was seen as damning blow for workers' rights by campaigning groups, including the TUC.

Speaking on Truss' appointment Ben Willmott, head of public policy at the CIPD, said in addition to tackling the cost of living crisis, the new government should consider how employment is regulated.

"The new government should strongly resist any temptation to water down employment rights and protections for workers. The UK is already one of the most lightly regulated labour markets among developed economies, with above-average employment levels and a high proportion of workers in permanent employment. 

"Business surveys consistently show that the UK’s SMEs don’t see employment regulation as a significant impediment to growth, which strongly suggests that any push to deregulate in this area would be an unnecessary and potentially damaging distraction.

"Instead, the government should focus on delivering on previous commitments to reform labour market enforcement and support the creation of more flexible workplaces. These changes to policy can help raise employment standards overall and create more better-quality jobs."

Intentions of new Employment Bill:

Employment Bill delay detrimental to worker's rights

P&O scandal adds new fire to Employment Bill demand

Are we turning back the clock on workers’ rights in the UK?