Labour pledges to reform sick pay and ban zero-hours contracts

Labour’s promise to extend and increase sick pay to all workers has been welcomed by unions and charities.

In a speech to this year’s TUC Congress, Labour leader Keir Starmer also promised a ban on zero-hours contracts and an increase in day-one rights for workers.

“Keir Starmer is right to focus on dignity at work. This pandemic has exposed the inequality and insecurity at the heart of our labour market,” said Frances O’Grady, general secretary of the TUC.

“No one should be pushed into financial hardship if they fall ill at work. During the pandemic, too many couldn’t afford to self-isolate because sick pay is too low or they aren’t eligible for it at all. This badly undermined our public health effort during COVID.”

Coronavirus' impact on workers' rights:

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

Millions of UK employees trapped in low paid and insecure work

Morrisons to cut sick pay for unvaccinated, isolating employees

The UK currently has one of the lowest rates of sick pay in Europe at £96.35 a week but it is a benefit that two million workers don’t qualify for.

Experts say the low earnings limit (LEL) set each year by the government disproportionately impacts particular groups of workers that are more likely to be on low pay.

“The existing system of statutory sick pay typifies the worst aspects of the British system of benefits, with both a low level of payment and a hangover from our old contributory system that means that low earners are entitled to nothing,” said Mike Brewer, deputy chief economist at the Resolution Foundation.

“Women, younger and older workers, and workers with atypical contracts are all more likely than the average worker to have to do without sick pay at present.”

The TUC estimates that one in ten women are not entitled to SSP due to the LEL threshold.

Mary-Ann Stephenson, director of the Women’s Budget Group, says reform of statutory sick pay is long overdue.

“Over the last 18 months we’ve seen far too many people, the majority of whom are women, faced with the stark choice between self-isolating when they are ill, and being able to pay rent or feed their families,” said Stephenson.

The Labour leader’s proposed ban of zero-hours contracts was also deemed good news.

Earlier this year, research by the TUC found that 67% of workers on insecure contracts said they received no sick pay compared with 7% of secure workers.

Stephenson said this is a critical issue in sectors where the use of zero-hours contracts is widespread.

“This has been a particular problem in social care, where 80% of the workforce are women and which is characterised by low pay and insecure working conditions,” she commented.

“During COVID, care workers have risked high levels of exposure to COVID, knowing that if they become ill they will be left without enough to live on, or not receive sick pay at all.”

The newly announced measures will form part of Labour’s New Deal for Workers, which was originally announced in the summer.

Under the deal, the party, should it be elected, will also introduce a £10 minimum wage, expand parental leave to all workers, enshrine a day-one right to flexible working and ban ‘fire and rehire’ tactics.