Labour migration policies under debate

The impact of recent immigration and asylum policies, and proposals for their reform, have been widely debated over the first three months of 2005. This article examines data on labour migration to the UK from the EU accession states in 2004, and reviews the wider policies of employers and trade unions on migrant workers in the UK labour market.

Since the mid-1990s, trade unions and employers’ associations have largely supported government attempts to develop a more active 'managed migration' policy in the UK. Alongside policies to tackle illegal working, a series of measures were introduced to streamline and extend the legal migration routes previously available. These initiatives focused on the demand for short-term casual labour, as well as for highly skilled professional and technical staff and hi-tech business entrepreneurs. In a period of sustained economic growth, declining unemployment, and severe recruitment and retention problems in many sectors, an increasing number of work permits were granted for up to five years and, with the support of their employers, migrants were often granted 'indefinite leave to remain' in the country (UK0212105S). Partly as a result of these policies, the Office for National Statistics estimates that over the decade to 2002, 3.9 million people entered the country as migrants and 2.8 million left; a net inflow of more than a million.

EU enlargement and migration to the UK

Since 1 May 2004, nationals of Malta and Cyprus have had full free movement rights and rights to work throughout the EU. However, prior to enlargement, existing EU Member States agreed that transitional arrangements could be introduced to limit or regulate access to their labour markets by nationals of the other eight accession countries (the 'A8'). In contrast to most other EU Member States, the UK government did not directly restrict the rights of workers from the A8 to seek employment in the UK from May 2004. It did, however, introduce a Worker Registration Scheme (WRS) to monitor the impact of A8 nationals’ participation in the labour market, and restrict their access to tax-funded welfare benefits.

In February 2005, four government departments published a joint Accession monitoring report. Its main findings were as follows:

• there were 133,000 applicants to the WRS between the beginning of May and the end of December 2004, and 123,000 were issued with registration cards and certificates. It was estimated that up to 40% of the applicants were already in the UK before May 2004. Some had been lawfully employed under temporary entry schemes (eg the seasonal agricultural workers scheme, and sector-based schemes in food processing and hospitality); and others had worked without authorisation;

• a majority of the applicants were Polish (56%), followed by Lithuanian (15%), Slovak (10%), Czech (7%) and Latvian (7%);

• 83% of the registered workers were in the age range 18-34 and the proportion of male and female workers was almost equal. Only a small minority (5%) of the registered workers had dependants living with them in the UK;

• the top five sectors employing registered workers were hospitality and catering (28%), administration, business and management (24%), agriculture (14%), manufacturing (8%) and food processing (5%);

• the top 10 occupations in which registered workers were employed were process operatives, kitchen and catering assistants, packers, waiters/waitresses, cleaners (domestic staff), warehouse operatives, room attendants (hotels), farm workers, sales (retail assistants) and care assistants;

• London attracted the largest group of registered workers (22%), followed by Anglia (17%). The geographical distribution was related to sectoral employment patterns - 37% of those working in hospitality and catering were located in London, and 35% of those in agriculture were located in Anglia; and

• almost all registered workers were employed full time (that is, for more than 16 hours a week), and 45% were in temporary employment. Reports from embassies in the UK and overseas suggest that many temporary workers return home after brief periods of work, or following unsuccessful attempts to find new jobs.

The number of WRS applicants from A8 countries far exceeded the earlier predictions of government ministers. As the number of work permits issued in 2004 - including sector-based schemes and training and work experience schemes - also rose to a record level of more than 181,000, critics of the government’s policies argued loudly that 'immigration was out of control'.

Policy proposals

Although immigration and asylum policies are rarely absent from public debate in the UK, as elsewhere, the timing and nature of the recent debate has been shaped by the proximity of a general election, called for 5 May 2005. In the last week of January, the leader of the opposition Conservative Party, Michael Howard, announced that, if elected, a Conservative government would withdraw from the 1951 United Nations Convention relating to the Status of Refugees, and impose a quota on the number of asylum seekers. It would also set an annual limit on the number of work permits, and introduce a points system giving priority to migrants with skills in short supply. Two weeks later, the Labour home secretary, Charles Clarke, published a five-year strategy for immigration and asylum, Controlling our borders: making migration work for Britain. Although asylum applications are now 67% below the level of two years ago, and the majority of new claims are decided much more speedily, tighter controls throughout the process would be implemented. The home secretary argued that 'tourists, students and migrant workers make a vital contribution to the UK economy, but we need to ensure that we let in migrants with the skills and talents to benefit Britain, while stopping those trying to abuse our hospitality'. This objective would be pursued in several ways:

• a new points system comprising four tiers - highly skilled, skilled, low skilled and students - will replace the current complex system of work permits, quotas and student schemes. Highly skilled workers will be able to come to the UK without a job offer if they accrue a required number of points based on their salary, experience and qualifications. Points will be adjusted to response to labour market changes, and an independent labour market advisory group will be set up to identify skill gaps;

• lower skilled workers and students will not have an automatic right to stay in the UK - they will have to leave when their visas expire. Skilled workers who support themselves financially can apply to stay permanently after five years;

• employers should share the responsibility in creating a robust system. Except for the most highly skilled, migrant workers will need a sponsor (eg an employer) who should work with the government to ensure that they comply with the rules of entry to the UK, and return home at the end of their stay; and

• employers who breach the immigration rules will be subject to a fixed fine of GBP 2,000 for each illegal worker, and from April 2005, employers will have to pay a higher work permit fee of GBP 335.

Employer and trade union reaction

The Chartered Institute of Personnel Development, the main professional body for human resource managers, provided the most detailed response to the proposed reforms in immigration policies. Its chief economist, John Philpott, argued that immigration had increased economic growth and helped to contain pay pressures in the tight UK labour market. In assessing the various proposals, he suggested that migration controls should take account of employers’ recruitment needs, operate flexibly, and avoid numerical quotas that 'tend to be set so high as to be meaningless or so low that they frustrate employers and risk being breached and thus discredited'. He noted that none of the parties acknowledge that any effective policy of migration control will put upward pressure on low-skilled wage rates, and require policy-makers to help employers fill job vacancies by improving basic skills and shifting more jobless people from welfare to work.

The director-general of the Confederation of the British Industry stressed the importance of migrant labour to the UK economy, especially in the construction, information technology and hospitality sectors. In similar vein, the chief economist of the Engineering Employers’ Federation argued that 'labour flexibility needs to get better not worse', and that if quotas for migrant workers were imposed unilaterally in the UK, the economy would suffer relative to those of other European countries.

In response to the immigration policy proposals of the government, on 7 February 2005 the deputy general secretary of the Trades Union Congress (TUC), Frances O’Grady, welcomed its commitment to continue to honour international obligations to provide a safe haven for refugees, and argued that in principle, the proposed shift from a work permit to a points system for migrant workers could be progressive. The current work permit system ties migrant workers to a single employer, making them powerless to resist exploitation - if they lose their job they risk deportation. The TUC also noted that the proposal to involve social partners in analysing skill shortages could lead to better training programmes, as well as a fair migration policy. Alongside these positive comments, however, the TUC argued that the government should do more to counter the myths about asylum and immigration, and implement stronger measures to deal with rogue employers that exploit migrant workers. The latter issue was explored in a lengthy TUC-commissioned research report, Forced labour and migration to the UK, by Bridget Anderson and Ben Rogaly.

In a foreword to the report, the general secretary of the TUC, Brendan Barber, argued that the employment practices of a minority of UK employers towards migrants fall under the internationally agreed definition of 'forced labour'. The report provides evidence of long hours of work, pay levels far below the statutory minimum wage, and dangerous working conditions, especially in construction, agriculture, nursing and care homes, and contract cleaning. It argues that the conditions that generate forced labour arise from the demand of some employers for 'ultra-flexible labour', especially in sectors characterised by an unequal market relationship between small suppliers and their customers, and where there are complex chains of subcontractors. The distinctive problems of migrant workers legally entitled to work in the UK arise from the power exercised by employers over their working lives: they may be dependent on their employer for accommodation; and employers may hold their passports, and intimidate or dismiss staff who are unlikely to understand their employment rights. The report concludes that, while the UK government has done much to combat forced labour, a 'more careful balance has to be struck between the control of immigration on the one hand, and the protection of migrant workers, including the victims of forced labour, on the other hand'.

Commentary

It is by no means certain that the proposals of either the Labour government or the Conservative Party will be implemented after the general election without further amendment. It is widely believed that the timing of the proposals, and the rhetoric that accompanied them, were strongly influenced by electoral calculations. Each of the political parties will have to clarify the details of its policies and implementation strategies, and the party in government after the election will be unable to ignore the threat to economic growth if it pursues a more restrictive approach to migration. After the election, the main political parties may return to the more informed and cautious style of debate that has characterised immigration policy (if not asylum policy) in recent years. Trade unions and employers’ associations will probably continue to share a broad consensus on the vital contribution made by migrant workers to the UK economy, although they will continue to disagree about the need for more effective labour market regulation and employee protection, in this area as elsewhere. (David Winchester IRRU)