Labour has been accused of handing a £37million favour to trade unions through the Employment Rights Act, critics say amounts to payback for bankrolling Starmer
Labour has been accused of handing a £37 million favour back to trade union barons who bankrolled Sir Keir Starmer’s march on Downing Street.
The Employment Rights Act, a law backed by the very unions that poured millions into the party’s election war chest, contains a provision which critics say will funnel more cash back to Labour.
Under the controversial legislation employees would automatically be signed up to see part of their union dues ringfenced for political funds, reversing the current system where workers must actively choose to opt in.
Four of the unions that back the bill have also given generously to the Labour Party since Sir Keir became leader in 2020.
Unite donated £9.4million, UNISON £8.5million, GMB £8million and USDAW £5.6million, to the parties war chest.
Union barons have praised the bill with UNISON hailing it as “groundbreaking, transformative and a gamechanger”.
The GMB called it “the biggest step forward for workers’ rights in 50 years”. USDAW went further, claiming it showed “the Labour-union link at its very best”.
Shadow Business Secretary Andrew Griffith branded the bill “payback, plain and simple”.
He said Labour’s “union paymasters have ploughed £37million into Starmer’s party since 2020, and now they’re cashing in”, warning the Act would make it “almost impossible to find a job” as “businesses won’t dare hire when every new worker is a legal minefield”.
Mr Griffith added: “Mark my words, these laws will drag us straight back to the chaos of strikes in the 1970s. Britain deserves better than this union stitch-up.”
Robert Colvile, director of the Centre for Policy Studies, said Labour came into power “promising to make growth their number one mission” and had “reassured businesses they were key to achieving the goal”.
But he said the reality had been “crushing new regulations like the Employment Rights Bill, which the government actively refused to get a proper costing for.”
Mr Colvile said the approach was strangling the economy at the worst possible time, warning that “workers benefit most from a vibrant, flourishing economy with businesses competing to attract talent, not one strangled by red tape and in which the cost of doing business is creeping up by the day.”
The row comes as critics warn the legislation will pile costs onto employers with unemployment already rising and the jobs market under pressure.
A Labour Party spokesman said the act was part of the “biggest upgrade to workers’ rights in a generation”.
They added that the government had increased the national minimum and living wage and improved parental leave.
“This is what being on the side of working people looks like,” they added.
