Employers warn Angela Rayner’s overhaul of workers’ rights will cause ‘havoc’
The number of payroll jobs has fallen by around 150,000 since Labour came to power (Image: William Lailey / SWNS)
The loss of more than 150,000 payroll jobs since Labour took is a “stark warning” of how its policies threaten employment, the Government has been warned. The number of Britons on payrolls has sunk from 30,453,605 in July last year to 30,301,776 in April.
Tina McKenzie warned that 46% of small business employers now say labour costs are among their “biggest barriers to growth”. She said just 8% of small businesses were able to increase their staff numbers in the first quarter of this year.
“It’s of course alarming to see the sustained fall in the number of employees on payroll,” she said. “The rise in employer National Insurance Contributions (NICs) will ultimately leave many paying more tax on employing people.”
Warning of “havoc” ahead, she said a planned overhaul of workers’ rights could also stop businesses taking people on.
She said: “The Government also needs to think again and rework the parts of the Employment Rights Bill that will wreak havoc on hiring. We know that 75% of small employers are worried about how the Bill will expand the grounds for unfair dismissal, and 74% fear changes to statutory sick pay.”
Larger employers are also worried.
Matthew Percival, of the CBI, said: “Our surveys show that businesses’ hiring intentions have been negative for several months, with cost pressures, heightened uncertainty and subdued trading conditions cited as key factors. While some of this is about tariffs, UK Government decisions matter too, potentially more so.
“The increase in National Insurance Contributions is a big factor, along with the National Living Wage and the anticipated cost of the Employment Rights Bill.”
Shadow Chancellor Mel Stride said: “The loss of 150,000 payroll jobs since Labour came to power is not just a statistic – it’s a stark warning. It reflects the very real consequences of Labour’s reckless economic mismanagement.
“Instead of supporting growth and job creation, they’ve chosen to hit businesses and workers with punishing tax hikes, including their damaging jobs tax.
“At a time when we should be encouraging employers to invest, hire, and grow, Labour has made it more expensive to create jobs and harder for people to find work. These decisions are not just economically short-sighted – they are fundamentally irresponsible.”
‘Every lost job is a lost opportunity’
Shadow Chancellor of the Exchequer Mel Stride (Image: Getty Images)
Warning of the impact on people’s lives, he said: “Every lost job is a lost opportunity, a lost future, a family struggling to make ends meet. Labour’s economic policies are costing Britain dearly.
“You can’t tax your way to growth. As an entrepreneur, who has built businesses from scratch, I know it’s business that creates prosperity.
“Taxing work means lower salaries, fewer jobs, more offshoring of jobs and more redundancies. Plus higher prices, higher interest rates and lower growth. Labour’s front bench doesn’t get it because they lack any real-world business experience.”
A Treasury spokesperson defended the Government’s record, saying: “We are a pro-business government. We have seen four interest rate cuts since the election, the fastest growth in the G7 at the start of this year, and in the last month we have secured new economic deals with the EU, US and India to help lower costs for businesses.
“We have also capped corporation tax, provided business rates relief, and are protecting the smallest businesses from the employer National Insurance increases.”
