National Strategy for Economic Transformation: second annual progress report

Annex B – Extended equality and human rights case study – Fair Work Action Plan

In December 2022 Scottish Ministers launched the Anti-Racist Employment Strategy and refreshed Fair Work Action Plan, superseding the predecessor plans on gender and disability. The Fair Work Action Plan includes a commitment to report annually on progress. Since the plan is a significant element of NSET Programme 5, this annex serves as the first annual report on the plan and sets out key achievements since publication.

The vision of the Fair Work Action Plan is for Scotland to be a leading Fair Work Nation by 2025, where fair work drives success, wellbeing and prosperity for individuals, business, organisations and society. It focuses on intersectional structural barriers that women, disabled people and racialised minorities face in the labour market and includes tools for employers. The actions detailed in the Fair Work Action Plan includes those relating to the Anti-Racist Employment Strategy.

Detailed progress updates can be found on the Fair Work Oversight Group webpage: Fair Work Oversight Group – gov.scot (www.gov.scot)

Headline Actions 1 and 2: Public Sector Leadership

Headline Action 1 – Role Modelling: The Scottish Government continues to support and engage with public bodies on anti-racism in employment. A workshop was co-delivered with CEMVO Scotland in May 2023 for the public sector, including health, education, justice, local government and Scottish Government agencies, on building safe and inclusive racialised minority staff networks, with a further session planned for 2024 on anti-racism learning and development. Presentations took place to three senior leadership groups on institutional racism, which facilitated a knowledge exchange and is informing the Scottish Government's approach to engaging with leadership on workplace equalities more broadly.

Headline Action 2 – Conditionality: Through the Fair Work First approach, fair work principles have been applied to over £4 billion of public sector grants, other funding and contracts between 2019 and 2023, driving fair work practices across the labour market. In July 2023 we strengthened the approach, requiring recipients of public sector grants to pay at least the real Living Wage and provide appropriate channels for effective voice for their workforce. Fair Work First guidance has been published to support workplaces to promote fair work and reduce workplace inequalities.

Headline Action 3: Our ask of employers and support available.

Action 3.2 – Communications Strategy: Workshops were held with key stakeholders and employers in early 2023 to develop a Fair Work media campaign. Feedback was used to craft five key messages and case studies, published through social media and partners, highlighting the benefits to employers in language developed with employers. Over 280 employers clicked through to the Fair Work Tool on the Scottish Enterprise website as a result of this engagement. This will help inform our future strategic engagement on Fair Work.

Action 3.3 – Accreditation: Since 2014, the Scottish Government has provided over £3m of funding to Living Wage Scotland to support employers accrediting to the real Living Wage scheme. The number of accredited Living Wage employers is up from 14 in 2014 to over 3,500 in 2024 with at least 65,000 workers in Scotland receiving a pay rise resulting from accreditation, making a real impact for people in the lowest paid jobs. This contributes to 89.9% of people in Scotland being paid at least real Living Wage, the highest figure for all UK Nations. Further, there are now 53 real Living Hours accredited employers in Scotland, with the Scottish Government becoming the first UK administration to achieve Living Hours Employer accreditation November 2023.

Action 3.4 – Dissemination of learning from the Workplace Equality Fund: The Workplace Equality Fund (WEF) provides financial support for employers to address longstanding barriers in the labour market for priority groups, including women, disabled people, racialised minorities and the over-50s workforce. Between 2022 and 2024, 13 projects received over £1.3m of funding, engaging over 620 employers, across 43 sectors and producing 228 products supporting the creation of diverse and inclusive workplaces. A WEF conference was held in November 2023, which facilitated a knowledge exchange to a range of employers in attendance. Feedback was very positive, with 86% of those surveyed indicating that the conference had impacted their understanding of workplace equality. The outputs and learning from the Fund and the conference will be included in the Fair Work resource hub to support employers across the economy. That is also an action in the Fair Work Action Plan. An Equality and Human Rights case study covering 2022-2023 can be found here.

Action 3.6 – Flexible Working: Since 2020, the Scottish Government has provided over £680,000 in funding to promote and support employers across Scotland to adopt flexible workplaces. Funded activity included: Timewise delivered three 'Scottish Flexible Jobs Index' reports and established 'A Fair Flexible Work Programme for Scotland'. Over two years they provided advice and support to 2,900 employers and 2,895 parents and carers, and 73 organisations took part in their change agent network with 76% reporting being motivated to take action to ensure fairer access to flexible work. Flexibility Works produced four Flex for Life reports, toolkits and guides and employer case studies; carried out employer and employee surveys; held knowledge sharing events and flexible working employer award events; and raised awareness in the press and social media.

Headline Action 4: Support for people to prepare for, access and sustain fair work.

Actions 4.2 and 4.3 – Employability: Actions 4.2 and 4.3: An Equality and Human Rights case study on Employability, including the Fair Start Scotland service and the No One Left Behind approach, can be found in Programme 5 of the main body of this report.

Action 4.6 – Health and Work: A review of Health and Work is underway with recommendations to ministers due in spring 2024. A review of the flexible working offer has taken place with options in development for future delivery. Public Health Scotland (PHS) are working with Health Boards focusing specifically on Fair Work, absenteeism, access to and retention in work, and NHS as an anchor institution, with the outputs feeding into policy development. By promoting access to NHS based support and aligning support for employers and employees, PHS are helping to enable people with health conditions to secure, sustain and progress in work. Over 130 organisations, representing over 90,000 employees have requested support from Health Board Healthy Working Lives teams in the last 12 months.

Headline Action 5: Monitoring and Evaluation

The Ministerial Fair Work Oversight Group was established in August 2023 providing an advisory and challenge function, driving progress of the actions Fair Work Action Plan, including those relating to the new Anti-Racist Employment Strategy. This group is now chaired by the Minister for Employment and Investment and receives biannual progress reports on progress of the Fair Work Action Plan actions.

The Fair Work Evidence Plan was published in early 2024 and sets out analytical activity being undertaken to support the implementation of the Fair Work Action Plan and future policy development. Overall progress on delivering the Evidence Plan will primarily be reported via updates and reports to the Fair Work Oversight Group, with specific evaluations and other outputs published as standalone reports as available.

Fair Work priorities being taken forward across Scottish Government

Fair Work Agreements have been promoted across key sectors where low pay and precarious work can be most prevalent to encourage fair work practices and improve collective bargaining to achieve higher standards of pay, better security of work and greater union representation. For example:

• Publication of the Transformation Action Plan (Jan 2024) to take forward the commitments of the Scottish Construction Accord, including key principles of fair work, diversity and inclusion by the Construction Leadership Forum through the dedicated Construction Accord Fair Work Group.
• The Adult Social Care sector is taking forward delivery of four key workstreams which will support the development of a Sectoral Fair Work Agreement. These are: Pay, Terms and Conditions, Effective Voice and Sectoral Bargaining. The Adult Social Care pay deal set a £12 minimum pay rate from April 2024, representing a 10.1% increase from the £10.90 minimum rate that was introduced in April 2023 for adult social care workers delivering direct care in commissioned services.
• The Scottish Government will provide local authorities with an additional £16 million in 2024-25 to meet the additional costs of paying childcare workers delivering funded ELC in private and third sector services at least £12 per hour from April 2024.
• The Retail Industry Leadership Group (ILG) will drive, and support delivery of the actions set out in the Retail Strategy, in particular on improving fair work across the sector.

Community Wealth Building: The Scottish Government facilitated a series of workshops in partnership with The Democracy Collaborative in summer 2023, attended by over 150 local authority officers and community planning partners. These supported participants to develop their Community Wealth Building (CWB) strategies. The Scottish Government also engaged with the Poverty Alliance to reflect the views of those with lived experience of poverty to further support and develop CWB policy and forthcoming legislation on this issue. Local Authorities and their partners will be further supported in their ongoing adoption and implementation of CWB through the development of legislation and CWB networks.

Women in Entrepreneurship: As set out in Programme 1 of the NSET report, in June 2023 the Cabinet Secretary for Wellbeing Economy, Fair Work and Energy committed to full implementation of Ana Stewart and Mark Logan's Pathways report on widening female participation in entrepreneurship. As a first step in implementing the report's recommendations, the Scottish Government allocated £1.3m in funding across 20 partner-run projects supporting early stage entrepreneurship activity in 2023/24. The outcomes of these projects will support further development of the Pre-Start support model in 2024/25.

Disabled People's Employment: In financial years 2020/21 and 2023/24, we invested £1.2m in the Apt Public Social Partnership (PSP) which worked to improve the recruitment and retention of disabled people. The PSP engaged with employers in the private and third sectors, with a particular focus on SMEs throughout Scotland, including in rural areas. Employers involved in the partnership to date have reported benefits such as improved recruitment and retention processes, increased confidence in having conversations about employment with disabled people and increased awareness about the benefits of a diverse workforce. An independent evaluation of the PSP's impact on creating culture change in employers' practices will be commissioned in 2024/25.

Scottish Government Publications relating to Fair Work Action Plan actions.

• Action 3.8 – Sectoral Fair Work Agreements: The Illustrated Fair Work Guide for Employers | Creative Scotland – 2023 A Culture Strategy for Scotland: Action Plan – gov.scot (www.gov.scot) – Dec 2023
• Health Action – Menopause and menstrual health workplace policies: Interim national menopause and menstrual health policy for NHS Scotland (wellbeinghub.scot) – Oct 2023
• Mental Health Action – Creating mentally healthy workplaces: Mental health and wellbeing: workforce action plan 2023-2025 – gov.scot (www.gov.scot)
• Procurement Action – Update statutory guidance: Fair work and procurement – Public sector procurement – gov.scot (www.gov.scot) – March 2024
• Tackling Violence Against Women and Girls Action – Equally Safe refresh: Equally Safe strategy – Violence against women and girls (VAWG) – gov.scot (www.gov.scot) – Refresh 2023
• Transport Action – Research on women and girl's safety on public transport: Women and girls' safety on public transport | Transport Scotland – March 2023