THE KING’S SPEECH: A NEW LEGISLATIVE AGENDA

Simon Whitehead, partner and head of recruitment and workforce solutions at purpose-led independent law firm Brabners, explores the potential implications and opportunities for the aerospace industry as the new government sets outs its policy plans.  

 

After weeks of intense political campaigning, the dawn of a new government provides an apt moment for the aerospace sector to reflect on its ability to support a more innovative, prosperous Britain.

With cost pressures easing, chief among the sector’s priorities – alongside better embracing innovation through digitalisation, automation and AI – will be addressing the growing skills gap. The latest industry data suggests there are more than 10,000 unfilled vacancies in the sector – many of which will be here in the North, home to a number of major employers.

The positive news is that the government is already taking steps to address the skills agenda as it develops what it has billed as both a ‘pro-business and pro-workers’ approach to reform. This was evident in the recent King’s Speech, where it set out its policy plans and the necessary legislation to support them.

 

Apprenticeships reform
The creation of Skills England, announced in the speech via the Skills England Bill, is a particularly welcome step. While its full remit awaits definition, structurally speaking, having a single unified body to ensure that the national and regional approach to skills development supports any new industrial strategy appears a sensible decision. For it to succeed though, it’s important that the body works in tandem with businesses from innovative sectors like aerospace – as well as devolved powers – to meet their specific needs.

 

A good example of this will be in its initial task to reform the existing Apprenticeship Levy, which is commonly a charge paid within manufacturing supply chains. Since its introduction in 2017, the Apprenticeship Levy has supported over 300,000 apprenticeships. However, with recent data indicating that £3.3bn raised by the Levy has been returned to the government unused, it’s clear that businesses have been unable to maximise its potential.

One shortcoming has been that businesses that rely on long-term contingent staff – such as factory workers or seasonal engineering teams – aren’t able to use the funding to upskill temporary employees, yet are still required to pay into the fund via their suppliers if their wage bill exceeds £3million annually. In response, Labour has trailed the introduction of a Growth and Skills Levy which would grant firms greater flexibility to use up to 50% of their levy contributions to fund training through routes other than apprenticeships.

 

This again is a welcome change as it should allow for more flexibility in using the levy to develop and upskill team members, which is a frequent criticism of the Apprenticeship Levy.  We are still waiting for the detail but Labour plans to create a list of approved non-apprenticeship training courses that will be eligible for funding. The intention is that the new levy will support training that meets specific business needs and skills gaps. For example, it could provide an opportunity to level-up teams with shorter courses in technical skills, such as AI and data. These are vital areas that will be necessary for future business success and to maintain a competitive edge within the aerospace industry.

 

Greater protection, greater risk

Elsewhere in the speech, the Employment Rights Bill – which the government intends to introduce in its first 100 days – represents a significant initiative that employers will need to evolve alongside. There are significant elements aimed at temporary workers (the gig economy), by addressing one sided flexibility, and the new legislation will also make parental leave, sick pay, flexible working and protection from unfair dismissal available from day one.

 

On the flexible working front, employers will be required to accommodate this as far as is reasonably practicable, which in itself is a subjective field. While the aerospace sector has not been the most natural fit for more flexible work arrangements previously, offering greater flexibility for employees is likely to be one of the key ways in which it can attract new talent and make a positive difference in addressing the skills gap.

 

Indeed, with employees previously needing two years of service to qualify for some of these protections, this reflects the positive trend towards employers adopting a people first-approach in pursuit of a positive knock-on effect in productivity and retention, and which Labour see as a key factor in supporting their growth requirements.

 

The counter argument goes that by binding employers to their new joiners much earlier on, the changes have the potential to increase the cost and HR risk associated with employing staff and terminating working arrangements. However, the government assures us that probationary periods will have an important role to play in allowing aerospace employers to assess performance and take appropriate measure in the early stage of the relationship. By eliminating the potential for exploitative working practices, we anticipate the move will help with staff retention and development in the long-term.

 

A delicate balance

The initiatives are unlikely to come as a surprise – alongside other measures like banning zero hours contracts and unethical ‘fire and rehire’ practices, they are all part of the New Deal for Working People that Labour committed to in its manifesto. Now it is in government, its challenge will be to ensure it is able to protect workers’ rights while delivering on its aims to support private sector growth in key industries like aerospace.

 

For employers across the sector, which have supported more than £3.6bn-worth of R&D investment over the past decade, the new legislation represents a chance to better attract, retain and develop the talent to maximise future government funding and continue to put Britain at the forefront of sustainable aviation.

 

For support around any of the new legislation proposed in the King’s Speech as well as broader recruitment law issues, you can get in touch with Brabners’ Recruitment & Workforce Solutions team via https://www.brabners.com/sectors/recruitment-workforce-solutions.