Is Employment a Right or a Privilege?

I run an engineering business that I started nearly 40 years ago. Don’t believe the hype that running one’s own business gives you independence and freedom. Instead. you create a millstone, but equally it is a drug and your baby, so one keeps at it from one day to the next.

The drug part is my love of seeing it all working, the logistics behind providing customers with the products they want when they want them. The nightmare bit is employing people, we have on the whole a very good team at the moment but all it takes is one rotten apple and it can turn everything sour.

There are only twenty-four of us of which four are close family, but that leaves twenty very different characters to knit together into a coherent team. Things can tick along quite happily for months and what is normally a minor issue will crop up and it gets blown up, out of proportion.

A high proportion of our people have been here for ten or twenty years and have all sorts of perks such as share options, enhanced pension contributions, private health and extra holiday time for length of service.

However, the problem is that employment law is now so complex and has removed much of the responsibility from employees themselves and piled it on to the employer. If you have to discipline an employee one has to follow a particular procedure instituted by Tony Blair’s government which might make sense to a bureaucrat in Whitehall but is just not practical in the workplace setting of a small business like ours where one wants to get things sorted out quickly and move on. Everyone has a contract from day one here but in many areas it is worthless, I as the employer can be held to account by it, but the state is so involved in the minutiae of the relationship between employee and employer that the law trumps anything in the contract. They are signed between consenting adults and the state should keep out of them.

We now have the new law from our present socialist government requiring us as employers to offer flexible working from day one of an employee’s time with us. This may be easy in the public sector though considering the dire state of the services we expect government to provide we perhaps need rather more work and less flexibility there. Customers pay our wages and they require our products fast, we therefore need to machine and build them quickly, how can I allow flexible working to machine operators and others involved in getting product out of the door, a job that can only physically be done here within the normal working day? If I then allow others doing office-based work to do it flexibly is that fair on those who can’t work flexibly? Why is it necessary for government to legislate using blunt law to force employers to consider requests for flexible working?

We take people on to do a job – this should be on the terms agreed between me, the employer, and the employee. He or she is not obliged to take the job if they are not happy with the terms. We understand that Labour want to ban probationary periods for new employees, why?    Taking on a new employee is a lottery and there may be many reasons why a new one just does not fit, people can be on their best behaviour at interviews and have references that will say nice things about them, but when it comes to doing the job they are just not up to it. We recently had someone who came to us saying he was desperate for a job, felt like crawling up the wall, he hated being unemployed.  He had done some training off his own bat and all looked good. However, he never seemed to get properly get out of the starting blocks, always complaining that he hadn’t been trained to do X or Y so was having to be taught over and over again the same thing. He was given many chances to improve but just didn’t seem to care and we had to ask him to leave after nearly 18 months in the job and many chances to actually start pulling his weight.

Our contract requires employees to serve a month’s notice if they want to leave but that is worthless from our point of view. In almost all cases where one leaves for another job they leave without serving the full notice because they either forgot to tell the new employer or don’t want to tell them because it may jeopardise the new job. The only recourse we have is to sue which is pretty pointless, yet if we refused to give notice to an employee all hell would be let loose.

The sword of Damocles that I feel hanging over me at all times is that if one disciplines or sacks an employee for whatever reason it is worth their while suing you whether they are in the right or the wrong. It is compulsory for us to be insured for employee liability and the most widely used insurer in this field will take on the case and quite simply make a judgement as to whether it is cheaper to buy the complainant off or fight the case. It is all a big game and even the defending solicitor, appointed by the insurer would appear to be out to maximise fee income at the insurer’s expense. By suing, an ex-employee is virtually guaranteed to get something.

A few years ago we had a gross misconduct case which we had to defend ourselves as the insurer wanted to settle from day one. From the point of view of the business we could not be seen by the rest of our staff to have caved in to this person considering how he had treated many of them as well as the business as a whole. It cost a lot of time and money and annoyingly at the end of the day we did have to settle due to  a peculiarity of employment tribunals which absolutely enraged me at the time. I gave him a one year written warning, which I was able at the time to do but during that year a tribunal judged that a first written waring could not be for longer than six months, and therefore that the warning was no longer valid at the time of dismissal. Our employment solicitor was unaware of this and it was only the barrister we had hired to fight the case who brought it to my attention whilst we were waiting to go into the tribunal room.

Another area of government interference is the minimum wage, now increased to £11.44 per hour, more than £1.00 an hour in the last hike. This has become another nightmare  and though we pay above it, it has squashed the differentials between different types of work done in the business as we just can’t afford to increase everyone’s salaries by this amount, we would quite literally run out of money. We work a 42.5 hour week meaning that the lowest salary we could legally pay is £25282.40. Add to this 3%  compulsory pension contributions and 13.8% employers’ national insurance contribution (tax on jobs!) taking the total minimum cost of taking on a new full time employee to £29,529.84.

Whenever I hear how more laws are required to protect poor workers from unscrupulous employers, no one ever points out that if employees don’t like their job they are perfectly free to go and find another one. They don’t have to take on a new job if they don’t like the terms offered, they can even walk off the job with virtual impunity as I have found. There is little in terms of equity in much of the law around employment, employers are the evil ones and employees are seen as exploited. We have to be mindful of the stress they are under or the anxiety involved in doing their job but the resulting stress on employers is ignored – they can suck it up. Is a job a right or a privilege?

Using the law to deprive employees and employers of the power to make their own arrangements, simply makes it more and more difficult to run businesses and therefore will increasingly deprive Britons of employment opportunities. Government should stick to constructing the framework that makes the economy as dynamic as possible which in turn will, from experience, generate plenty of well paid jobs. It does not do this by making our labour market increasingly sclerotic by using the law to manage the relationship between employees and employers.

For many of us, who started our businesses when anything seemed possible in the Thatcher era, and have held off selling up or liquidating them the prospect of Labour and their plans fills us with dread. Having said that, a continuation of Sunak’s socialism and need to control the way we live our lives is not much better. Reform UK might be good but I don’t see any more coherence in what they have to offer though there is an enormous desire among many to vote for a party that articulates our frustrations and will actually get under the bonnet and fix the mess of the last quarter century.

Alastair MacMillan runs White House Products Ltd, a manufacturer, distributor and exporter of hydraulic components to over 100 countries. He is a supporter of the Jobs Foundation.

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