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Archie Norman, chairman of Marks and Spencer and former Conservative MP, has cautioned that Labour’s proposed “new deal” for workers if implemented after the next general election, could deter investment in Britain. Norman highlighted concerns about the impact of Labour’s policy on flexibility in hiring, increased costs, and the potential reintroduction of unions into workplaces, emphasizing the importance of attracting new investment to spur productivity growth.
Labour’s proposed workers’ rights reforms include banning zero-hours contracts, ending fire and rehire practices, and eliminating qualifying periods for basic rights. The party has engaged with business figures, including former Bank of England governor Mark Carney, to garner support and promote investment under its new economic approach.
However, there appears to be a lack of clarity in Labour’s communication with the business community regarding its workers’ rights agenda. While Labour asserts that its policies will not hinder investment, business leaders remain sceptical, particularly about proposals to grant full rights from “day one,” potentially eliminating probationary periods and complicating hiring decisions.
Alex Baldock, CEO of Currys, expressed concern over ending probationary periods, warning that such a move could make businesses more cautious about hiring. Labour’s Shadow Business Secretary, Jonathan Reynolds, defended the party’s stance, emphasizing stability in corporation tax, action on business rates, and policy certainty for long-term investments under Labour’s economic approach.
The debate underscores the ongoing tension between Labour’s vision for workers’ rights and business concerns over investment and operational flexibility. This dialogue will likely remain a focal point leading up to the general election, with implications for Britain’s economic direction and investment climate.
