Tag Archives: In-work poverty

Tackling the wrong kind of flexibility: the work of our legal helpline in 2014

By Richard Dunstan, Workflex blog editor

Amid the biggest living standards crisis in a generation, and with research by the Institute for Fiscal Studies and the London School of Economics suggesting that the Coalition’s tax and benefit reforms have hit families with children under five harder than any other household type, 2014 was another busy year for the Working Families helpline team.

Simon, a single parent working for a provider of services to the elderly, called the helpline after his employer refused his formal request to change his work pattern to accommodate an unavoidable change in his childcare. Although employed on a zero-hours contract, Simon had for several years worked five full days a week, including Saturday and Sunday. But now his childcare support had changed, Simon could no longer work weekends, and he was afraid he would have to give up his job.

Simon is one of 2,766 working parents and carers – 85 per cent of them women, and almost one in four a single parent – who telephoned or emailed the helpline in 2014. The helpline team provides free advice on key work-life balance rights such as maternity and paternity leave and pay, provides support on requesting and negotiating flexible working – or with contesting imposed changes to an existing working arrangement – and advises on challenging pregnancy, maternity or other discrimination at work and accessing relevant social security benefits and tax credits.

The team’s annual report, published today, shows that, despite some reduced capacity due to staff changes, and an increase in the proportion of callers requiring more than one interaction, the team advised and supported almost 200 more callers than in 2013. And, as in previous years, the most common issues raised by callers were: maternity leave and pay; benefits and tax credits; other maternity rights; flexible working; and pregnancy or maternity related discrimination.

With essential living costs having risen faster than wages in recent years, and childcare costs continuing to spiral upwards, many of those who contacted the helpline were simply struggling to find a way to make work pay.

Nicky called the helpline shortly after returning to work from maternity leave, because she was struggling with the cost of childcare for her six-months-old child. Nicky earns just over £20,000 per year, and her partner – an apprentice electrician – £15,000 per year. The helpline team was able to confirm that Nicky is receiving the right level of working tax credit, but Nicky feels she has no choice but to give up work to care for her child.

Many of the women on maternity leave who contacted the helpline team were finding it difficult to manage on the weekly statutory maternity pay of just £138.18, capped at below-inflation annual increases since 2013 and equal to just 60 per cent of the national minimum wage.

Jackie called the helpline while on maternity leave and receiving statutory maternity pay, because she wanted to take more than nine months’ maternity leave but simply couldn’t afford to take unpaid leave. The helpline team reports that this is a “very common call”, and that many women in low-paid jobs have little choice but to return to work at the end of statutory maternity pay.

Many others who called or emailed the helpline in 2014 were trying to adopt a flexible working pattern in response to a major change in their caring responsibilities, such as taking on the care of an elderly parent, relationship breakdown, or the onset of disability of a child or partner. And, in theory at least, this became easier from June 2014, with the extension to all employees of the right to request flexible working, previously limited to parents and carers. In the words of the then employment relations minister, Jo Swinson, “we want to see flexible working become the norm, not the exception”.

However, the helpline team report that, if there is one stand-out feature of their work in 2014, it is that the notion of flexible working is simply illusory for all too many of the parents and carers who contact the team for help.

The wrong kind of flexibility

In low-paid sectors like social care, retail, cleaning, and hospitality, hundreds of thousands of men and especially women work on zero-hours contracts and other ‘casualised’ forms of employment that offer little in the way of pay, guaranteed hours or job security.  And what Citizens Advice calls the “hyper-flexibility” of such jobs is all one way.

By their nature, such insecure jobs, with varying and unpredictable weekly hours, can result in significant variations in income, making it hard to arrange (or retain) childcare and disrupting social security payments. But they also make it very difficult if not impossible for workers to successfully request a change in their hours or working pattern to accommodate a change in their family circumstances, or to resist a problematic change in their hours or working pattern imposed by their employer.

For a refusal to work shorter, longer or simply different hours can easily lead to there being no hours at all. And the introduction of upfront tribunal fees in July 2013, unaffordable to many, has made it harder than it’s ever been to challenge any unlawful action on the part of the employer. In the months following the introduction of fees, claims for unfair dismissal fell by 65 per cent, and claims for sex or pregnancy discrimination fell by 80 per cent. In the words of one senior employment judge, it is “difficult to resist the conclusion that access to justice has been curtailed”.

Mandy had worked for a bank on a zero-hours contract for several months without any indication from her employer of dissatisfaction with her work. However, when Mandy informed her employer she was pregnant, her manager stated there had been complaints about her work. And, when Mandy challenged this, the manager changed the story to “you haven’t been working hard enough”. Mandy’s hours were then reduced to zero – in effect, she was summarily dismissed.

Similarly, Denise, employed on a zero-hours contract, had had her working hours substantially cut since she had taken time off for a pregnancy-related illness. When she had challenged her employer, pointing out that several new staff had been taken on, she was told “we need people we can rely on”. The helpline team advised Denise that her treatment amounted to pregnancy discrimination, but Denise said there was no way she could afford to pay the fees of £1,200 to pursue a tribunal claim.

Against this rather grim backdrop, the helpline team can – and frequently does – make a huge difference to the situation of individual callers. Good information and personalised advice empowers callers to make an informed decision about whether and how to negotiate with their employer, the most effective way to challenge unlawful treatment, or how to change their working pattern in such a way to maximise their income once benefit payments, tax credit awards and childcare costs are taken into account.

Evidence from the casework of the helpline team also informs the wider policy and campaigning activity of Working Families, including our ‘families and work’ manifesto for next month’s General Election. So we remain extremely grateful to the team’s key funders, Matrix Chambers and the Big Lottery Fund, and to our many other supporters who make the work of the team possible.

An afternoon in Westminster: the Working Families policy conference

By Richard Dunstan, Workflex blog editor

Last Tuesday, some 120 policy wonks, campaigners and academics  gathered in Portcullis House, Westminster for the second Working Families annual policy conference, kindly hosted by former cabinet minister Maria Miller MP. With the presentation of two new Working Families reports, keynote speeches by MPs from each of the three main parties, and panel discussions on ‘The 21st Century Working Family’ and ‘Tackling In-Work Poverty’, there was a crowded agenda. And it being exactly 100 days to go to the General Election on 7 May seemed to add a certain spice to the debate.

Not surprisingly, there was much talk of manifestos, and some very welcome indication from the three MPs – Maria Miller for the Conservatives, shadow childcare minister Alison McGovern for Labour, and BIS minister Jo Swinson for the Liberal Democrats – of cross-party support for key policy asks in the Families & Work Manifesto for May 2015, developed by Working Families, Family & Childcare Trust, Fatherhood Institute, Fawcett Society, Gingerbread, Grandparents Plus, Maternity Action, NCT, Parents Across Scotland, Single Parents Action Network, TUC, Women’s Budget Group and others.

Noting the “record numbers of women in work” and that “the sandwich-generation faces the dual challenge of childcare and eldercare”, Maria Miller said “we have to ensure that a model of work designed by men for men is not just given a lick of paint. We have to make flexible working the norm.” Mrs Miller suggested that the Families & Work Manifesto call for adoption of a ‘flexible by default’ approach to job design and recruitment in the public sector is “something that should be taken up by all three main parties.”

On childcare, Mrs Miller noted that, while overall supply has greatly increased over the past two decades, “affordability and flexibility are the challenges we’ve yet to meet.” And, as demonstrated in the new Working Families report Off Balance, launched at the conference, this is especially true for the working parents of disabled children and young people, for whom childcare is not just an ‘under fives’ issue.

Picking up on one of the key findings from the new Modern Families Index, also launched at the conference, that “there is an appetite among working parents” for the Shared Parental Leave (SPL) that comes fully into force in April, employment relations and equalities minister Jo Swinson noted that “the cost of childcare can be a major barrier to new mothers returning to work after maternity leave” but “childcare is not just an issue for women.” Ms Swinson believes the availability of SPL will “prompt a conversation” between parents on how to share their new caring responsibilities.

Endorsing Maria Miller’s call for private sector employers to adopt the Happy to Talk Flexible Working strap line developed by Working Families,  Ms Swinson argued that male business leaders should “use their visibility to set a good example” on flexible working and shared parenting. The Families & Work Manifesto calls for ministers to act and recruit business leaders as ‘flexible working’ champions, and encourage use of the strapline.

Following a theme that was later to be raised again and again in the two panel discussions, Alison McGovern argued that policy-formulation on childcare and flexible working must recognise, and reflect, the reality of life for millions of low-paid working parents. For all to many low-paid working mothers in particular, flexible working now means only a zero-hours contract, with no security of job or income. And, with wild fluctuations in weekly income, finding and holding on to affordable childcare becomes a near impossibility. All too often, “families have no choice at all.”

Ms McGovern also flagged up a need to focus on the necessarily long-term goal of a seamless framework of parental leave rights and State-funded childcare. As Sam Smethers of Grandparents Plus was later to highlight, some 50 per cent of working families rely on grandparents to fill the current ‘childcare gap’ between the end of statutory maternity leave (at 12 months) and the start of free entitlement to childcare (at three years).

In the two panel debates that followed an all-too-brief break for coffee, the delegates and panel members – Alison Garnham of CPAG, Fiona Weir of Gingerbread, Sam Royston of The Children’s Society, Ellen Broome of Family & Childcare Trust, William McDonald of the Fatherhood Institute, and Sam Smethers of Grandparents Plus – confirmed by their contributions that, despite welcome progress in the law, public policy, and practice of many employers on flexible working and shared parenting, there remains, in Maria Miller’s words, “far more to do”. Falling real wages, growing casualisation of the labour market, spiralling childcare costs, and swingeing cuts to maternity benefits in recent years have made being a working parent more challenging than ever for all too many.

Over the next few weeks, we’ll learn what ideas politicians such as Alison McGovern, Maria Miller and Jo Swinson and their parties have for the next government to make work work that little bit better for parents, carers and their families.

You can now follow this blog on the new Working Families website blog pages

Manifesto 2015: how does Labour measure up?

In the second of our series of Workflex posts assessing the likely manifesto pledges of the main political parties, Richard Dunstan looks at how Labour Party policy measures up against our own ‘Families & Work’ manifesto for May 2015.

On the eve of its conference in Manchester, Labour released the annual report of its National Policy Forum (NPF), which oversees the development of party policy. At 218 pages, the report is almost three times as long as the Liberal Democrats’ pre-manifesto. And, with most of those pages consisting entirely of densely typed text, it’s a tome that is unlikely to be read cover-to-cover by anyone other than hard-core party members. But having been agreed by delegates in Manchester, the document now forms Labour’s “official policy programme”. So how does this programme measure up?

Time and equality

While there is disappointingly little mention of fathers – and certainly nothing to match the Liberal Democrats’ headline promise of six weeks’ statutory paternity leave – the NPF report rightly notes that the right to request flexible working has been weakened by abolition of the statutory procedure.” It pledges “Labour will support flexible working for parents, and will consider how best to support grandparents who need to fit the care of their grandchildren around their working hours.”

Labour will also “examine ways to improve support for those who are bereaved, including how flexible working rules can be used to support them.” However, the report is silent on whether Labour will continue with, tweak, or ditch the right to shared parental leave (SPL), which will have come into force just one month before the next government takes office. In our ‘Families & Work’ manifesto, we call for reform of SPL so as to simplify the legal framework, open eligibility to all fathers from Day One of their employment, and enable SPL to be taken on a part-time basis.

There is welcome recognition of the proliferation of pregnancy and maternity discrimination in UK workplaces in recent years, and a pledge to “close legal loopholes which allow pregnancy discrimination.”  More broadly, there is a “commitment to ensuring that all workers are properly protected in the workplace” and to “acting to end unfair practices and abuses in the labour market.” However, the NPF report does not explain how “increased protection for agency workers” will be enforced by an employment agencies inspectorate that, since 2010, has been reduced to a rump of just three staff.

But it is one of the few more specific policy pledges that is also the most significant. Noting that the hefty, upfront employment tribunal fees introduced in July 2013 have “resulted in prohibitive costs locking people out of justice they are entitled to”, the NPF report commits Labour to abolishing the fees regime and replacing it with “a system where affordability will not be a barrier to justice”. This would be a very welcome move, as restoring access to the tribunal system is essential to tackling pregnancy and other discrimination in the workplace, and to underpinning the newly-extended right to request flexible working.

Money

One of the few policy announcements in Manchester to grab headlines was leader Ed Miliband’s pledge to raise the National Minimum Wage (NMW) rate to £8.00 per hour “by 2020”, which in practice means from 1 October 2019. This put flesh on the bone of the NPF report’s commitment to giving the Low Pay Commission a “new framework” with a “strengthened role in tackling in-work poverty,” and a “five year target” for increasing the NMW rate “so that it gets closer to average earnings.” The proposed hourly rate of £8.00 from October 2019 would raise the NMW from 54 to 58 per cent of the median wage, but still leave it some way short of 66 per cent, the standard definition of ‘low pay’.

Interestingly, the NPF report also states that HMRC’s role in enforcing the NMW “should be expanded to include non-payment of holiday pay” and that Labour “will also consider expanding enforcement to include non-payment of statutory sick pay and statutory maternity, paternity and adoption pay.” That would be very welcome.

Disappointingly, there is no commitment to addressing the ludicrously low rate at which statutory maternity, paternity and adoption leave are currently paid. In our ‘Families & Work’ manifesto, we call for restoration of the real value of such pay, lost as a result of the one per cent cap on annual uprating since April 2013, and a programme of annual, real-terms increases to bring parity with the NMW within ten years.

On Universal Credit, the NPF report promises “a full review” and, if it goes ahead, “major changes [to] ensure the system makes work pay for both first and second earners … and is easy to access.”  This would be welcome.  In our ‘Families & Work’ manifesto, we suggest the potential of Universal Credit to ensure that work really does pay could be enhanced by (a) introducing a work allowance for second earners, and (b) strengthening safeguards to prevent parents being pushed into family-unfriendly jobs by the threat of sanctions.

Childcare

The NPF report reiterates Labour’s previously announced policy of “extending free childcare for three and four year olds from 15 to 25 hours per week for working parents, paid for by an increase in the bank levy”, together with “access to ‘wraparound’ childcare from 8am to 6pm” for parents of primary school children, through their local school. The report states this will “benefit those families that most require childcare support and currently struggle to find good quality before-and-after school care.”

Clearly, any increase in the provision of free childcare is welcome. But, as with the Liberal Democrats’ pre-manifesto, Labour’s offer falls a long way short of the “national strategy on childcare, aimed at delivering universal access to good quality, affordable childcare within ten years” that we call for in our ‘Families & Work’ manifesto.  And again it is disappointing to find no specific pledge to address the harsh childcare crunch faced by parents of disabled children – the subject of a recent parliamentary inquiry.

[The next post in this series will look at how the Conservative Party’s policies measure up against our ‘Families & Work’ manifesto]

 

 

 

The Living Wage: key to improving work-life balance

In this guest post, Guy Stallard, Head of Facilities at KPMG UK, argues that a living wage is key to improving work-life balance.

The Living Wage is being discussed widely by politicians, which is unsurprising as recent KPMG research showed that 5.2 million people in the UK are paid below the Living Wage rate, and there are wider concerns from the public about the rising costs of living. The view from many politicians across the political spectrum is that the Minimum Wage at its current level is insufficient. There are a growing number of employers, now over 700, who have voluntary accredited themselves for paying the Living Wage, including almost 10 per cent of the FTSE 100. Accredited businesses are finding that the productivity and flexibility of staff is improved for those paid the Living Wage, and in light of this I want to highlight just how the Living Wage improves the work-life balance of employees as well.

Individuals who only earn the Minimum Wage are likely to be working multiple jobs or excessive hours just to provide a basic standard of living for their families. Those who receive the Living Wage have personal stories on how it changed their lives – such as housing conditions, time spent with families, or the challenge of providing adequate food and shelter.

I recall vividly, the testimony from one individual who now receives the Living Wage, that getting to work used to mean a four-hour bus journey and now means a one hour tube ride. According to a recent BBC report, earning minimum pay means some workers are unable to afford nutritious food or are forced to rely on food banks to feed themselves and their families. These daily struggles are hard for some to imagine but are very much a reality for many people working in the UK.

The Living Wage also helps individuals to gain a better work-life balance. At the launch of the new Living Wage rate last November, Lacey, a worker paid the Living Wage explained that it meant she and her child could finally move out of her parent’s home and live independently as a family unit. The small things that meant a lot to her were the ability to take her son to karate and football lessons. A catering worker in London told me that before moving to a Living Wage job they used to be on the Minimum Wage, having to work weekends which, “no longer allowed me to survive without working my body to the brink”.

Another worker giving testimony in the North West recently said that the Living Wage allows him to work confidently as a father and provider. It means not relying on friends for support, loans and food banks and gave him pride in being able to feed his own family. In another example, Amin, a worker from London who previously worked two jobs, explained that it wasn’t just him who benefited from receiving the Living Wage. Amin was able to prioritise the one job, spend more time with his family, and set up a youth group in his community – showing that the benefits spread wider than the individual.

The Living Wage is not a one-stop solution to finding the best work-life balance, but it has certainly helped tens of thousands of people to earn enough in a full-time role to maintain an acceptable yet modest standard of living. Compelling evidence shows that those working for less than the Living Wage are overstretched, and unable to spend time with the families they work to provide for. Being able to strike a work-life balance not only allows them to focus at work, with increased productivity and commitment, but allows quality time with their family and community.

Everyone who supports employees being able to live in a socially acceptable manner should applaud the organisations which are accredited Living Wage employers and support more firms to make the change, which will benefit individuals, their communities and the UK overall.

Guy Stallard is Head of Facilities for KPMG UK, responsible for services into the offices, and has a team of over 700 in-house and outsourced staff. Guy is a member of KPMG UK’s Corporate Responsibility Leadership Committee where there is a strategic focus on social mobility, the environment, and promotion of the Living Wage. Since KPMG became a living wage employer in 2006, Guy has worked within and outside of the organisation to promote the Living Wage and share his experiences of implementation. Guy also represents business as a commissioner on the Living Wage Commission, which is led by the Archbishop of York.

How employers can reduce in-work poverty

In this guest post, Katie Schmuecker of the Joseph Rowntree Foundation argues that employers have an important part to play in reducing the UK’s serious and growing problem of in-work poverty.

There are 1.4m jobs being done by people on zero-hours contacts, according to new figures published by the ONS. This means a fairly sizable chunk of the workforce has a job, but won’t necessarily be offered any hours by their employer from one week to the next. Perhaps it is not surprising that zero-hours contracts have become the poster-boy for bad employment practice in 21st century Britain.

But as the debate about an appropriate response to this particular problem steps up a gear, there is a risk that we fail to see the wood for the trees. As pernicious as the insecurity brought by zero-hours contracts can be for some workers, they are but one part of the UK’s much bigger problem of in-work poverty.

More than half of the 13 million people experiencing poverty in the UK live in a household where at least one person is working. This gives an indication of the scale of the problem. And it is not a problem that can be solved by pushing up the minimum wage and regulating the use of zero-hours contracts alone. Neither is it a task that government can tackle alone: employers also have an important part to play.

New research by the Joseph Rowntree Foundation examines how employers can help to tackle working poverty. It takes paying the Living Wage as a given, and asks what other employment and management practices might help to address poverty. Written by economist John Philpott, importantly it also asks what the business case is for employers implementing different practices.

The report looks across human resources management and development practices such as structured recruitment, training, performance management, flexible working and fringe benefits, such as help with travel and childcare costs or access to a staff discount scheme. It finds that – when delivered well – these practices can help employees progress to a better job, reduce the stress of balancing work and home life, and help reduce the cost of living. For employers they can boost productivity, employee motivation and loyalty. They can also reduce staff turnover costs and absenteeism.

So far sounds like a win-win situation.

But there are three caveats.

First, getting the desired outcome relies on practices being delivered by good-quality managers, an area where the UK falls short compared to other competitor countries.

Second, they seem to work better when employees are involved in decision making, for example through trades unions or staff councils.

Third, and most challenging, is the large number of British businesses operating perfectly profitably competing on the basis of low-cost and low-quality products and services. So long as these companies have no difficulty hiring people into low-paid, low-skilled jobs that require little by way of formal skills, and where job-related skills can be acquired relatively quickly and cheaply, there is little incentive for them to change.

Many employers are only vaguely aware – if at all – of the problem of poverty among their workforce, and much can be achieved by working with employers to raise awareness and improve business practice in ways that are good both for the employer and the employee. We cannot simply focus on zero-hours contracts as a symbol of what is wrong with the labour market.

Rather, we need employer aspiration to translate into demand for a more skilled workforce, changing the nature of work at the bottom end of the labour market.

Until that happens ,we stand little chance of making serious headway with tackling in-work poverty.

Finding financial help for working families

In this guest post, Emma Lamberton sets out why Turn2Us is running its ‘Benefits Awareness Month’ campaign.

“Despite working full time, my wages simply weren’t enough to support my family, and we started to fall behind on our rent and bills. Affording the right food for our children and even keeping the house warm became too much of a stretch.” Isaac

Sadly the problems experienced by Isaac and his family are indicative of growing numbers of families across the UK. Despite being in work, parents are struggling financially as they are hit by a lack of stable employment, a fall in real wages and the rising cost of living. In fact, Joseph Rowntree Foundation research shows that nationally, for the first time ever, there are now more working households living in poverty than there are non-working households.

It is clear that the impact of economic improvements has yet to reach these families and we recently found that over three-fifths (62 per cent) of working parents on low incomes feel their financial situation has worsened in the last year. Shockingly, almost half (49 per cent) say that their outgoings now outweigh their earnings.

The toll this is taking is severe, with almost half (48 per cent) of parents in work forced to cut back on food and other essentials, nearly two-fifths (38 per cent) saying they have been unable to sleep and almost a third (30 per cent) reporting depression as a result of their situation.

We know from speaking to the people we help that there is often a lack of awareness and a reluctance to claim the financial support available. This is the case for many working parents who may not realise that they could be eligible for help in the form of Working Tax Credit and other welfare benefits. Yet our recent research has shown the value of checking potential entitlements, with 85 per cent of working families who currently claim saying benefits have had a positive impact on their lives, helping with bills, childcare costs and even avoiding debt.

Through our current campaign Benefits Awareness Month, we want to raise awareness of in work benefits and help more people in need to access financial support. We are encouraging people to take a few minutes out of their day to use our free Benefits Calculator and check what financial support they could be entitled to. Even if people have checked their eligibility before, it is always worth doing so again, especially if they have recently experienced a change in circumstances such as a decrease in income, having a baby or separated from a partner.

Our website also features information on other support available for each employment group, so that people can access further help whether they are employed full time or part time, are self-employed, on a zero hour contract or on long term leave.

Throughout the campaign we are also encouraging people to visit our website to share their own experiences of struggling despite being in work to help us build a picture of what life is really like for people living on low incomes.

Through hearing about Turn2us, Isaac managed to make a successful claim for Housing Benefit, at around £400 per month. He says this extra income has ‘helped his family enormously’ with their food and heating costs and that they are ‘able to cope better with everyday life’. Through our campaign, we hope that more families experiencing similar issues will be able to access the financial support available to them.

Benefits Awareness Month, which runs until 16 May, is being supported by a number of charities and organisations across the UK, including Working Families. For more information, please visit the Be Aware section of the Turn2Us website or join us on Facebook or Twitter.

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