Business leaders warn new labour laws ‘won’t get Britain working’

The Labour Party has been warned that efforts to tackle Britain’s “terrible” unemployment crisis could be thwarted over its employment rights.

Figures from the Office for National Statistics (ONS) showed the number of people who are “economically inactive” hit a near-record high of 9.4 million, thanks in part to the epidemic of long-term illnesses which affected 2.8 million people, also close to an all-time high.

Work and Pensions Secretary Liz Kendall said Britain was facing “spiraling” economic stagnation and rising unemployment and was the only advanced G7 nation where employment had not returned to pre-pandemic levels.

“This is a truly terrible legacy that the Government is determined to address,” Kendall said.

But business groups have warned Labour over its rights platform, which promises rights from day one including the right to work from home, protection from unfair dismissal and a ban on zero-hours contracts.

Neil Carberry, of the Recruitment and Employment Confederation, said: ‘The Government must be careful that its job protection agenda does not hinder progress.

Proper collaboration is needed to make the changes work effectively for all workers, especially those who want and choose to work flexibly.

Unemployment is at 4.4 per cent while wages are rising by 5.7 per cent a year, according to the ONS.

Matthew Percival of the CBI said a bill on workers’ rights would come at a time when businesses are facing significant pressures on labour costs.