Strong public support for improving workers rights and conditions
24 November 2024New polling reveals strong public support for reforms recommended in a new report to improve communication between employers and staff, empower workers, promote better pay and reduce inequality.
The research, a ‘Charter for Fair Pay’ authored by the High Pay Centre think tank and funded by abrdn Financial Fairness Trust, set out a series of measures to address workplace rights and corporate governance that could boost pay, and potentially help to reduce the scale of inequality in the UK.
Key results from the polling about recommendations for change include:
• Profit sharing and worker ownership: 66% of respondents support a requirement for companies to allocate a proportion of their shares and profits to their workforce. Only 7% oppose this.
• Pay transparency: 69% support more transparency over pay for top earners, meaning companies would publish more information on employees earning over £150,000. Only 10% oppose this.
• Trade union rights: 69% support rules ensuring management remain neutral when workers vote on trade union membership (5% oppose).
• CEO pay ratios: 55% support the pay of company CEOS being capped in relation to the pay of their average employee to avoid high pay inequality. Just 15% of people oppose this. The report calls for caps to be introduced in industries providing public utilities or services such as water or social care.
• Workers on boards: 51% support a requirement for companies to include at least two directors elected by the workforce on their board (11% oppose).
The research, a ‘Charter for Fair Pay’ authored by the High Pay Centre think tank and funded by abrdn Financial Fairness Trust, set out a series of measures to address workplace rights and corporate governance that could boost pay, and potentially help to reduce the scale of inequality in the UK.
Key results from the polling about recommendations for change include:
• Profit sharing and worker ownership: 66% of respondents support a requirement for companies to allocate a proportion of their shares and profits to their workforce. Only 7% oppose this.
• Pay transparency: 69% support more transparency over pay for top earners, meaning companies would publish more information on employees earning over £150,000. Only 10% oppose this.
• Trade union rights: 69% support rules ensuring management remain neutral when workers vote on trade union membership (5% oppose).
• CEO pay ratios: 55% support the pay of company CEOS being capped in relation to the pay of their average employee to avoid high pay inequality. Just 15% of people oppose this. The report calls for caps to be introduced in industries providing public utilities or services such as water or social care.
• Workers on boards: 51% support a requirement for companies to include at least two directors elected by the workforce on their board (11% oppose).
‘A Charter for Fair Pay’ is based on research on policy proposals that could lead to better pay and higher incomes for low-to-middle earners, and lower inequality. Many of the policies already apply in other countries. Recommendations include:
• Strengthening proposals in the forthcoming Employment Rights Bill to ensure employers provide workers with information on their workplace rights, and preventing them from manipulating votes on trade union recognition - based on similar proposals put forward in the USA.
• Creating seats for worker directors on company boards, in line with rules that exist in most other European countries.
• Setting voluntary targets for worker share ownership and profit-sharing schemes, in line with similar targets for gender diversity on boards or pension fund investment in UK growth companies.
• Making rules on pay disclosure more consistent, by requiring large private employers to provide greater transparency on the pay of their highest earners, following the model that applies to public sector and voluntary sector employers.
An Employment Rights Bill is currently undergoing Parliamentary scrutiny, and the Department for Business and Trade Select Committee opened a call for evidence relating to the proposals that runs until December 6. Further employment policy reforms proposed in Labour’s general election manifesto are to be put to public consultations. A Draft Bill on Audit Reform and Corporate Governance was also proposed in the King’s Speech of July 2024. The High Pay Centre is urging the Government to use these opportunities to empower workers with a stronger bargaining position in pay negotiations and more say in business decision-making.
High Pay Centre Director, Luke Hildyard said:
“The UK has some of the worst income inequality of any rich country, while workers in Britain have less of a say in what happens in their workplace than almost anywhere else in Europe. But there is a real opportunity now to use the new Government’s bold legislative agenda to strengthen worker voice and bridge the pay gap between top executives and the wider workforce.
“The policies we recommend do not dictate pay outcomes through Government regulation, but establish the framework for a more democratic, participatory business culture leading to higher pay for low- and middle-income workers and reduced inequality. These changes would lead to increased employee engagement and productivity which is good for business and the UK economy.”
Vivienne Jackson, Programme Manager at abrdn Financial Fairness Trust , said:
“The Employment Rights Bill is an opportunity to make businesses work for everyone. As a society we are still feeling the effects of high inflation and the cost-of-living crisis so it’s more important than ever that workers have decent pay, conditions and representation.”
Read full report