Fair Work: action plan

5. Fair Work First

Fair Work First focuses on encouraging and supporting employers to create more diverse and inclusive workplaces where workers have security of pay and contract, can develop and utilise their skills and have an effective voice in the workplace.

Through Fair Work First, the Scottish Government will use its financial power to make fair work the norm.

We are committed to working in partnership with employer organisations and employers representing a broad spectrum of sectors as we deliver Fair Work First. We are also committed to working with stakeholders as we develop and implement Fair Work First and determine how it should apply to employers of different size and sector and in different geographical areas. Our phased approach to implementation will take account of the economic context, including the impact of EU exit and COVID-19.

Fair Work First asks employers to commit to adopting the following criteria:

• Appropriate channels for effective voice, such as trade union recognition.
• Investment in workforce development.
• No inappropriate use of zero hours contracts.
• Action to tackle the gender pay gap and create a more diverse and inclusive workplace.
• Payment of the real Living Wage.

Note: In line with policy priorities and stakeholder views, the criteria were updated in August 2019 to address specific challenges in the labour market.

We believe that adopting such practices can make businesses more competitive by improving talent attraction, reducing staff turnover and absenteeism while improving motivation and workforce engagement.

By the end of this Parliament, wherever it is appropriate to do so, we will:

• extend Fair Work First criteria to every type of grant, funding stream, and business support budget open to us; and
• extend the range of Scottish Government and public sector contracts that Fair Work First criteria will apply to.

In 2019/20, we will test this new approach by attaching Fair Work First criteria to Regional Selective Assistance (grants available for projects which will create or protect jobs in Scotland) and other large Scottish Enterprise job-related grants. This will focus on grant recipients paying the real Living Wage, no inappropriate use of zero hours contracts and meeting the legislative requirements to publish information on the gender pay gap. We will use the lessons learnt to inform our discussions with employer organisations and employers as we take forward Fair Work First.

We will also work with employers to develop tools to help reflect on their current practices and to consider how they could implement and evidence Fair Work First criteria. Additionally, support for Fair Work First will be part of the single portal for business currently being developed following a recommendation of the Enterprise and Skills Review.

Note: Fair Work First Guidance was published on 29 January 2021 to support employers to adopt the Fair Work First criteria. It explains the Fair Work First approach, provides good practice examples to guide employers' approaches and explains the Fair Work benefits for workers and organisations.