Fair Work Action Plan 2022 and Anti-Racist Employment Strategy 2022: equality impact assessment

Appendix C Relevant legislation and policy

C.1 National policy

C.1.1 Fair Work Framework^[79]

The Fair Work Convention published the Fair Work Framework in 2016. It sets out a vision that 'by 2025, people in Scotland will have a world-leading working life where fair work drives success, wellbeing and prosperity for individuals, businesses, organisations and society'.

The framework defines Fair Work through five dimensions: effective voice, opportunity, security, fulfilment, and respect. These dimensions support positive outcomes for employers, workers and society through balancing rights and responsibilities in the workplace. The reinforcing synergies within these five dimensions nurture a workplace where the benefits of productive and innovative work are shared, while society benefits from the potential transformation towards inclusive economic growth.

The five dimensions of Fair Work are as follows:

• Effective voice: Voice can improve the experience of work as well as improving organisational performance.
• Opportunity: Fair opportunity is, however, more than the chance to access work. Attitudes, behaviours, policies and practices within organisations – and, crucially, the outcomes of these produce – signal and reflect the value placed on fair opportunity.
• Security: Security of employment, work and income are important foundations of a successful life.
• Fulfilment: Workers who are fulfilled in their jobs are more likely to be engaged, committed and healthy.
• Respect: Fair work is work in which people are respected and treated respectfully, whatever their role and status. Respect at work is a two-way process between employers and workers.

C.1.2 National Strategy for Economic Transformation (NSET)^[80]

The National Strategy for Economic Transformation outlines an ambition for a successful economy by 2032.

Driving this transformation is a vision to create a wellbeing economy. This recognises that 'every citizen holds Scotland's economic potential in their hands' and that not every citizen is currently afforded the same opportunities.

This vision identifies an ambition for Scotland's economy to be 'fairer' by 2032. Through 'ensuring that work pays for everyone through better wages and fair work, reducing poverty and improving life chances', the strategy seeks to not only grow the Scottish economy but to enable equality of opportunity and reward, as well as celebrating quality of life.

To achieve the vision of a wellbeing economy, the strategy sets out five programmes of action, including 'a fairer and more equality society'. This seeks to:

• 'Reorient our economy towards wellbeing and fair work, to deliver higher rates of employment and wage growth, to significantly reduce structural poverty, particularly child poverty, and improve health, cultural and social outcomes for disadvantaged families and communities.'

This strategy is aligned with Scotland's National Performance Framework, Tackling Child Poverty, Covid Recovery Strategy, and existing commitments within the five programme areas. Contributions to 'a fairer and more equality society' include:

• Fair Work Nation^[81];
• Community Wealth Building;
• Gender Pay Gap Action Plan^[82];
• Fair Start Scotland;
• No One Left Behind; and
• Culture Strategy for Scotland.

C.1.3 National Performance Framework (NPF)^[83]

The National Performance Framework is Scotland's wellbeing framework setting out a vision for a more successful, sustainable, and inclusive Scotland.

Within the National Performance Framework, there are 11 National Outcomes aligned with the United Nations Sustainable Development Goals and reflect the aspiration of the Scottish population.

The Fair Work and Business National Outcome measures progress towards Scotland's vision for 2025. This outcome measures progress towards the Refreshed Fair Work Action Plan (RAP) vision and guides the development of necessary legislative and operational structures to achieve a just and fairer Scotland. Performance against this outcome is measured through indicators, including the following:

• Pay gap
• Contractually secure work
• Employee voice
• Gender balance in organisations
• Employees on the living wage
• The number of businesses
• High growth businesses

C.1.4 Developing the Young Workforce: Scotland's Youth Employment Strategy^[84]

The Youth Employment Strategy sets out how the Scottish Government will implement the recommendations from the Commission for Developing Scotland's Young Workforce with the ambition to improve youth employment levels beyond pre-2008 levels.

The strategy prioritises equal access to work relevant educational experience for all young people, despite the barriers they may face. The active role of employers in shaping the education system to generate a talented pool of future employees is also recognised.

Scottish Government and Local Government implementation plans are set out for schools, colleges, apprenticeships, and employers, demonstrating the importance of providing young people with the knowledge to make informed career choices throughout their school studies and beyond.

C.1.5 Tackling Child Poverty Delivery Plan 2022-2026^[85]

The 'Best Start, Bright Futures' delivery plan sets out a vision for tackling child poverty in Scotland, following the foundations of the 'Every Child, Every Chance' publication in 2018.

The plan recognises that an action cannot drive change in isolation, but cumulative impacts across sectors will bring about change for children and their families.

To successfully tackle child poverty, the plan will support families with children through holistic and people-centred services to access financial, emotional, and practical assistance. All parents, regardless of gender, race, or status, will be able to access high quality skills and ultimately good quality employment supported by childcare services.

The Plan sets out three parts, each of which contain key actions in achieving Scotland's offer to families as follows.

Part A: Providing the opportunities and integrated support parents need to enter, sustain and progress in work

• A strengthened employment offer to parents
• Connectivity and childcare to enable access to employment
• Transforming our economy

Part B: Maximising the support available for families to live dignified lives and meet their basic needs

• A transformational approach to people and place
• Enhanced support through social security
• Income maximisation
• Access to warm and affordable homes

Part C: Supporting the next generation to thrive

• Best start to life
• Supporting children to learn and grow
• Post school transitions

C.1.6 Covid Recovery Strategy^[86]

In response to the inequality and disadvantage both exacerbated and exposed by the Covid pandemic, the Scottish Government published the Covid Recovery Strategy.

The strategy prioritises the security and resilience of communities, businesses, society, and the economy. It sets out a vision to:

1. Address the systemic inequalities made worse by Covid

2. Make progress towards a wellbeing economy

3. Accelerate inclusive person-centred public services

Accompanying this vision are the following outcomes:

• Financial security for low-income households
• Wellbeing of Children and Young People
• Good, green jobs and fair work

The 'good, green jobs and fair work' outcome recognises the persistent gender employment and pay gap, disability employment gap and ethnic employment gaps, especially for minority ethnic^[87] women.

By embedding fair work, skills and employability interventions, this outcome aims to increase productivity and enhance equality of opportunity for all to access and progress in work.

Actions from this outcome include gender, ethnicity and disability employment action plans, an ethnicity pay gap strategy, real Living Wage commitments and other Fair Work standards.

C.1.7 Race Equality Framework for Scotland 2016 to 2030^[88]

This framework sets out the Scottish Government's approach to addressing racism and inequality between 2016 and 2030. Through showing leadership in advancing race equality and addressing barriers faced my racialised minorities, the Scottish Government will assist racialised minorities in realising their potential.

The key principles underpinning this ambition involve:

• Creating awareness of how race equality benefits the whole of society;
• Developing a detailed understanding of racial inequality and racism;
• Promoting policy and practice that is evidence based;
• Complementing mainstreaming approaches with lawful positive action;
• Valuing capabilities and capacities; and
• Looking at race equality from intercultural and intersectional perspectives.

The Framework was created to prioritise the needs and experiences of Scotland's racialised minorities. It outlines how Scottish Government will work in partnership with government agencies and key stakeholders to address opportunities for progress through six themed Visions as follows.

• Overarching work: 'our Vision for a fairer Scotland is that by 2030 Scotland is a place where people are healthier, happier and treated with respect, and where opportunities, wealth and power are spread more equally. The Race Equality Framework aims to ensure that this vision is achieved equally for people from all ethnicities, helping to build a Scotland where we all share a common sense of purpose and belonging.'
• Community cohesion and safety:' We build good race relations and community cohesion across all communities, and all minority ethnic individuals feel safe, protected and included, and experience less racism.'
• Participation and representation: 'Minority ethnic participation and representation is valued, effective, fair and proportionate at all levels of political, community and public life.'
• Education and lifelong learning: 'Everyone has the opportunity to learn in an inclusive environment without disadvantage in relation to racial inequality or racism.'
• Employability, employment and income: 'Minority ethnic people have equal, fair and proportionate access to employment and representation at all levels, grades and occupation types in Scotland's workforce and experience fewer labour market, workplace and income inequalities.'
• Health and income: 'Minority ethnic communities in Scotland have equality in physical and mental health as far as is achievable, have effective healthcare appropriate to their needs and experience fewer inequalities in housing and home life.'

The Scottish Government recognise the importance of monitoring and maintaining progress on the Framework and aligning the Framework to the National Performance Framework to further mainstream race equality.

C.2 Partnerships

C.2.1 No One Left Behind^[89]

No One Left Behind is a collective approach to delivering an employability system which is flexible, people-centred, and responsive.

In 2018, the Scottish and Local Government agreed on a collaborative partnership for employability. This was followed by the publication of an Employability Action Plan setting out the framework to deliver 'No One Left Behind'.

The principles which underpin the No One Left Behind approach:

• Dignity and respect, fairness and equality and continuous improvement
• Provides flexible, and person-centred support
• Is straightforward for people to navigate
• Integrated and aligned with other services
• Provides pathways into sustainable and fair work
• Driven by evidence including data and experience of others
• Support more people to move into the right job, at the right time

Progress has been made through the Disability Employment Action Plan^[90], Shared Measurement Framework^[91], the Scottish Approach to Service Design^[92] and Fair Start Scotland extension^[93].

C.2.2 Fair Start Scotland^[94]

Fair Start Scotland, our national employment support service, launched in April 2018 and has been supporting people with significant barriers towards and into sustainable work.

The service is entirely voluntary and offers personalised, one to one support, tailored to individual circumstances. Pre-employment support can last up to 18 months depending on the specific needs of the individual and up to 12 months in-work support is also available to participants and employers to ensure people remain supported during employment.

The service has supported over 51,000 starts since launch in April 2018 and there have been over 17,500 job starts with high rates of sustained employment for those who started work. 63% of people receiving support on Fair Start Scotland reported a long-term health condition and 45% were disabled.

C.3 Other factors

Individuals and businesses face ever-changing burdens dependent on the cumulative impacts of socioeconomic crises. Those relevant to today's populations include Covid, EU Exit and the cost-of-living crisis.

C.3.1 Covid

Covid-19 has an impact on Scotland's health, economy and society and progress towards Scotland's National Outcomes from the NPF.^[95] Emerging and exacerbated labour market inequalities are likely to generate poverty and human right impacts relevant to the Fair Work and Business outcome.

Structural changes in the labour market disproportionately impact protected characteristic groups. For example, young people are increasingly faced with early unemployment, while older unemployed adults are experiencing more long-term unemployment and are less likely to participate in upskilling.

The Covid Recovery Strategy (2021) further recognises the disproportionate impacts of the pandemic on the following populations:

• Lower income households have been less able to save and have accumulated more debt;
• Young people are more likely to have been furloughed or lost their job;
• Women, disabled people, and minority ethnic groups have faced persistent employment and pay gaps;
• Young people and low-income earners employed in customer facing businesses (such as retail, hospitality, tourism, and the culture sector) have suffered through the longest Covid restriction; and
• Lower income households faced challenges in home schooling through the financial impact of remote learning, especially in accessing digital technology.

C.3.2 EU Exit

Consideration must be given to EU Exit undermining trading and collaborative relationship, which Scottish society and businesses have traditionally relied on as efforts are made to rebuild, restore, and identify new markets and potential trade relationships.

C.3.3 Cost-of-living crisis

The recent cost of living crisis, driven by a surge in inflation, has generated social, economic, and environmental vulnerabilities across Scottish households.

The Scottish Government published an analytical report of emerging evidence on the cost of living crisis, including public attitudes towards rising inflation and costs and households most affected.^[96]

The Open Society Foundations poll of 21,000 people recorded that 70% of British respondents named inflation and cost of living as one of the top-three challenging currently facing their family, community and country. Further, online polling by Ipsos MORI revealed that 54% of British respondents expected their disposable income to decrease over the next year.

While all households in Scotland will be affected by the increased cost of living, Scottish Government identify that disproportionate impacts are likely across low income households. These households are likely to be entering the crisis in a position of financial vulnerability and have restricted flexibility in their household's budget to cope with price rises. Low income households also include overrepresentations of the following groups: disabled people, lone parents, racialised minority households, child poverty priority groups, renters, young adults, unemployed adults and people with complex needs.

Further, the Joseph Rowntree Foundation published its annual 'Poverty in Scotland' report reflecting the results of a poll of 4,196 adults in Scotland undertaken between July and August 2022.

The report revealed that low-income households, single parents, and households with one or more disabled people are at a higher risk during the cost-of-living crisis.

Feelings of financial insecurity, food insecurity, social isolation and worsening mental health are evidenced through the following results:

• One-third of households have less than £250 in savings.
• Almost half (47%) of households have at least one debt.
• 65% of households have already cut back on an essential item.
• Three in four households have cut back on the basics.
• 18% of low-income households have skipped meals or reduced meal sizes and not heated their homes.

Household's increased chances of suffering acutely from the current inflation crisis heightens vulnerabilities to changing legislation, in both positive and negative capacities. Consequently, the potential exacerbation of impacts attributed to the cost-of-living crisis will be considered when assessing the impacts of Fair Work policies.