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The TUC General Secretary backs FSB on the need for supply chain respect in the post-Brexit landscape

Frances

Small businesses and trade unions have a lot more in common than many realise. FSB and TUC have made common cause in the past, for example working together to win the introduction of a national minimum wage rate for apprentices. 

But we now face a more profound challenge. Following the EU referendum result, we need to get Britain fit for the future. And that means big businesses must start taking their wider responsibilities more seriously. Trust in big business has hit rock bottom, with runaway pay at the top and some industrial-scale tax avoidance.

 

But that public concern should extend to the treatment of small businesses in supply chains, too. It’s not just about late payments. It’s about big corporations squeezing contract prices so hard that it’s nigh-on impossible for some small firms to meet their responsibilities to pay and treat their workers fairly. 

In our experience, most small businesses want to be fair employers. They see up close the damage that low pay and insecurity does to productivity and wellbeing. They understand that business success depends on paying a fair day’s pay for a fair day’s work, and that if people are denied a pay rise they will have less money to spend in the local economy.

But today, too often big business calls the shots. The relationship between big and small business is fundamentally unequal. And as with many workers, when it comes to a fair price for the job, many small firms feel they don’t have much bargaining clout.


That’s why Government must step in. Theresa May has spoken about a shared society and the need for an economy that works for everyone. Part of this must involve big business taking more responsibility for ensuring fair treatment through their supply chains. We believe the root of the problem lies in the growing gap between boardrooms and everyone else, including the network of small firms – and the small business workforce – on which their wealth is built. 

Without meaningful corporate governance reform, little will change. That is why the TUC has called for workers to be given seats on company boards. The European experience shows that improving worker representation helps improve company performance and guards against short-termism.

But let’s not stop there. As well as tackling executive pay, we also need to tackle low pay. The TUC has long argued for the introduction of modern wage councils. They would help to stop undercutting – a big problem for small businesses – and improve working lives.

If we are to make a success of Brexit we need to generate jobs that use people’s skills, talents and potential to the full. 



This requires a long-term industrial policy that reaches the parts of Britain that need it most, and fresh thinking across the piece. Many working people feel they’ve made huge sacrifices since the financial crash. And many small business leaders feel they’re working all hours to keep their enterprises afloat.

Britain’s economy needs a new approach if we’re to thrive outside the EU. It’s time for big business to do their bit and recognise that a right to turn a profit must be matched by responsibilities.