Business and Trade committee takes evidence for employment rights inquiry

Following contentious evidence on labour abuses from Shein and McDonald’s last week, on Tuesday the Parliamentary Business and Trade Committee held the final evidence session in its current inquiry Making Work Pay: The Employment Rights Bill, with a look at the reality of employment status, the gig economy and zero-hours contracts.

Questions for representatives of Frasers Group, Deliveroo, Evri and Uniqlo who atending the hearing included:

Does “flexible” – some might say insecure or precarious – work actually foment the conditions for workplace abuses?

Will the provisions of the Employment Rights Bill make effective change for workers and business, in a way that can counter any loopholes and unintended consequences for each?

Sports Direct, part of Mike Ashley’s Frasers Group, committed in 2016 to ending zero-hours but pulled back from implementing the change, and will face questions – alongside union representatives – about the conditions and practices needed to fairly manage workers’ time commitment instead.

Courier companies like Deliveroo and Evri, appearing in the second panel, have faced landmark legal challenges to the status, rights and benefits they afford their riders and must answer serious questions about the impact of industry practices like “rider substitution”.

And Uniqlo, appearing alongside, has made the unusual choice in garment retail to hire freelance workers rather than agency staff to cover flexible need.

Are these practices just ways for big business to cut costs by denying workers basic rights and benefits, with the ever-attendant risk of exploitation?

James McLoughlin of Logistics Manager magazine reported:

The first of the evidence sessions in this inquiry took place on 17 December 2024, with the BTC hearing from the likes of global conglomerate Amazon, defence and aerospace company BAE Systems and automotive giant Jaguar Land Rover. In addition to these businesses, the BTC also heard from representatives of organisations such as GMB Union and the Chartered Institute of Personnel and Development (CIPD).

During this session, chair of the BTC Rt Hon Liam Byrne said: “The government has set its sights on a pro-worker, pro-business agenda. But has it got the balance right? In this new inquiry we’ll be lighting up the key issues at stake and reporting back in time for the House to hear what we heard before the report stage of the bill.”

Then in the new year, these sessions resumed and on 7 January 2025, the BTC questioned the CEO of McDonalds UK and Ireland, and Tesco’s technical and sustainability director, as well as others including counsel for fashion retailers SHEIN and Temu.

These firms were questioned on labour rights in their national operations and international supply chains, while evidence was also given by the director of food and sustainability at The British Retail Consortium, and the UK independent anti-slavery commissioner.

SHEIN in particular has come under fire for its labour practises, after the online fashion retailer published its “2023 Sustainability and Social Impact Report” in August 2024, which revealed that two ‘incidents of child labour’ had been uncovered in its supply chain.

Giving evidence, Yinan Zhu, EMEA general counsel at SHEIN, refused to confirm at the time whether or not products sold by the company contain cotton from China and specifically the Xinjiang region, where BBC News has claimed there is evidence of ‘hundreds of thousands’ of minorities being forced into ‘hard, manual labour’ in cotton fields. She also refused to comment during the session on SHEIN’s attempted listing on the New York Stock Exchange and the London Stock Exchange.

Charlie Maynard MP, a member of the BTC, accused Zhu of “wilful ignorance” and described her answers during the meeting as “very unhelpful and disrespectful”, to which she responded: “I am giving the answers to the best of my ability”.

On 14 January 2025, the final evidence session of the inquiry was held, during which the committee heard from representatives of Frasers Group, Deliveroo, Evri and Uniqlo. Also giving evidence were senior figures at the Union of Shop, Distributive and Allied Workers (USDAW) and the Recruitment and Employment Confederation (REC). The focus of this session was the impact of the gig-economy and zero-hours contracts in today’s supply chains.

During this session Neil Carberry, CEO of the REC, raised a concern about how this bill would be enforced, should it become law: “Let’s be blunt about it – government passes law it doesn’t enforce. And actually, the bit about this bill I like the most is the stuff about the Fair Work Agency. I think there’s a real challenge here, which is the most common feedback from businesses to government at the moment is, if I comply and I take the course of compliance [and another business doesn’t], what happens to them? So I think that piece about enforcement really matters.”

According to a government factsheet, the Fair Work Agency (FWA) outlined in the Employment Rights Bill would be an executive agency of the Department for Business and Trade which would ‘bring together existing state enforcement functions and, over time, take on enforcement of a wider range of employment rights’. The intention behind this is to create ‘a single place where workers and employers can turn for help’.

Andy Brown, chief people officer at Frasers Group, was confronted about the decision made by Sports Direct, part of Mike Ashley’s Frasers Group, to go back on its commitment to end zero-hours contracts in 2016.

Brown, who has been with Frasers Group since 2020, attempted to explain why the group continues to employ staff on zero-hours contracts, saying: “We employ 11,500 people on zero-hours contracts in the business and we don’t see a benefit if those zero-hours contract workers are dissatisfied with the way in which they receive their shifts, that the churn is higher than it should be.

“So we’ve implemented a number of safeguards and ways of working that ensure there is as much certainty around hours as possible.”

Brown went on to say: “Our commitment to the people who come and work under those contract conditions with us is to try to give them access to at least 12 hours of work a week, if that is what they want. We averaged in the past 12 months 16 hours of work per zero-hours worker.”

When asked about Frasers Group’s commitment to moving more of its staff onto directly-employed contracts rather than agency ones, Brown responded: “We do still action that policy. Over the last three years, we have moved 593 people to permanent contracts from the agencies – so roughly 200 a year, on average.”

Later in this session, allegations from whistleblowers were presented to Hugo Martin, director of legal and public affairs at Evri. Amongst these allegations were those concerning wage discrepancies, failure to account for additional costs for couriers, issues with mislabelled parcels and the setting of “unachievable” targets.

Martin responded by claiming that he doesn’t recognise much of the evidence presented by the committee, adding that Evri wants its couriers to keep delivering parcels for the company and referencing the statistic that 60% of Evri’s couriers have provided services for over two years, as “evidence of a model that is fair and sustainable”.

The committee also presented health and safety complaints it had received to Evri’s Martin, raising issues including staff being “forced to work 27 days without a day off” over the peak period in December and a claim that “at one depot, fire exits are frequently blocked, cages with metal wires and spikes were protruding dangerously, and some depots have no toilet facilities or access to hot water”.

Martin refuted these claims, saying: “We have a set of requirements for all of the delivery units […] All of those units have operational toilets and hot water facilities. We do audit those facilities so I’m confident that those statements around health and safety, and the blocking of fire exits, are not accurate.”

On the other claims of long hours, he explained that Evri took on an additional 10,000 couriers to allow it to handle the extra parcel volume over the Christmas period and “where couriers are unable to collect all the parcels, the delivery units are kept open to allow them to come back and deliver them throughout the day, and of course they’re able to bring in other people to support them”.

The evidence given as part of this inquiry will be used to inform the Labour government’s Employment Rights Bill, which it claims will be the ‘biggest upgrade to workers’ rights in a generation’.

Amongst other things, it sets out plans to ban zero-hour contracts, end ‘fire and rehire’ and ‘fire and replace’, strengthen statutory sick pay and ‘make flexible working the default from day one’.

A report will follow the committee stage, after which the bill will have a third reading in the House of Commons before it can be passed through the House of Lords and, if successful, final amendments would be made and the bill could receive Royal Assent and be passed into law.’

Usdaw general secretary Paddy Lillis also gave evidence to the committee, at which he called for all workers to have a contract that reflects their normal hours of work over a 12-week reference period. Usdaw is also calling for the right to be available to all workers, including agency staff, and there must be anti-avoidance safeguards and effective enforcement to make the right meaningful:

“Our primary interest is to ensure that people are fairly treated, are fairly rewarded at work and can go to work knowing what their earnings and hours are going to be. That they’re not going to have them changed at the employer’s whim. People on low-hours contracts continually being asked to work more hours and not being able to work for another employer – that’s unfair. Of course, if you make a complaint and you’re not represented by a trade union, you have those hours removed and there is no legislative recourse. This about making sure there is fairness, so people go to work knowing their income and their hours; that’s why the contract is so important.”

You can watch proceedings from the Business and Trade Committee here.