WorkerTech Roundup – September 2024

I’m Aish, Resolution Ventures’ Ventures Manager and the new author of this monthly newsletter.

Here in the UK, nothing says Autumn quite like unpredictable weather, train cancellations and party conferences. As headlines from respective political talks begin to appear in the news cycle, we’re keeping an eye out for announcements and legislation to do with better work.

At the same time, there’s a lot going on outside of the world of politics and government, from an ETF betting on employee satisfaction to how delivery drivers are fighting back against AI surveillance in the workplace.

Also coming up: the Resolution Ventures team is hosting a WorkerTech meet-up and drinks next week (Tuesday, October 1st). In attendance will be founders, investors and experts from across the world of better work. Join us for an evening of networking and conversation through this link.

On a final note, what is writing a newsletter but talking aloud about shared topics of interest with your community? So, in the spirit of conversation, I’d love to hear from you! If you have any comments, suggestions or just fancy a chat, please respond to this email.

Until October,
Aish Moothan
Ventures Manager 

️ REGULATION ROUNDUP ️

The Deputy Prime Minister has confirmed that the new Government’s flagship Employment Rights Bill will be presented to Parliament next month. While it’s known that the Government’s employment reform plans will be ambitious and extensive, it has not yet been confirmed what will be enacted directly through the Bill versus other forms of legislation.

Some of the pledges that are part of the Government reform plans will be implemented next spring. These include potential changes to the National Minimum and Living Wage rates, removal of some qualifying limits for statutory sick pay, and a review of parental leave.

There are, however, two confirmed laws coming into force over the next few months:

The first is known as the Tipping Act, which will be effective from October 1st onwards. It applies to all industries where tips, gratuities, and service charges are processed by an employer. All employers falling under this category will be required to have a written policy on fair tip allocation and maintain records for tip acquisition and distribution on a 3-year rolling basis.

It’s important to note that cash tips given to workers without employer involvement are excluded from this code.

Then, effective from the 26th of October onwards, the Worker Protection Act of 2023 comes into effect. This legislation imposes a legal positive duty on employers to take ongoing actions to prevent sexual harassment in their workplaces by both staff and third parties (including, clients, customers, contractors and suppliers).

However, an alarming number of employers don’t have the necessary preparations in place to remain in compliance with the Act, a study by employment law consultancy WorkNest has found. Just 5% of employers surveyed by WorkNest said they were well-prepared for the upcoming changes.

If you’re interested in the wider landscape of these upcoming changes, have a read through Resolution Foundation’s Low Pay Britain 2024 paper

FROM THE WORLD OF WORK

Employee safety or Employer surveillance?

It was in 2021 that Amazon first installed AI-powered cameras into its delivery drivers’ vans to monitor how they worked, citing safety as the driving motivation behind the decision. The cameras were kept continuously on, prompting Amazon workers and drivers to protest that they represented a serious breach of workers’ privacy. The cameras would also often mistake normal human behaviours like itching, as dangerous. A year later in 2022, privacy rights campaign group Big Brother Watch unsuccessfully called for installations of the same cameras into Amazon UK vans to be put on hold – an early sign that such workplace surveillance was not only making it across the pond, but may also be gaining acceptance in the UK.

This brings us to 2024, where Tesco in Dagenham have installed CCTV cameras in their entire delivery fleet to continuously film drivers while they’re on duty. The move has drawn anger and protest from hundreds of workers and drivers, in a campaign hosted by online worker network Organise*.

The open letter for the campaign states that the installation of CCTV into their vans is an invasion of their privacy, raises serious concerns about data protections and erodes workplace trust through the misuse of surveillance tech.

In the past, similar campaigns on Organise have led to momentous wins for workers’ rights such as bettering parental policies at M&S  and working with unions and disability rights groups to reverse a decision to close train station ticket offices. Tesco Dagenham workers’ petition so far has amassed 312 signatures.

*A Resolution Ventures portfolio company, Organise exists to give workers in precarious, shift and low-paid jobs the tools and network to improve pay and conditions and to campaign for better work. They’re currently looking for brilliant people to join their team. Find out more here.

Fund bets on happier workers for returns
Employees have long known that often underpinning company success is whether it can recruit and – crucially – retain talented talent.

It seems Wall Street has caught up.

Philadelphia-based investment research firm Irrational Capital has created a Human Capital rating system that picks companies to invest in based on how happy their workers are. Employee views of their company are scored across seven categories to form a rating. No financial data is included, but there is data on how effective and innovative an organisation is, as well as a gauge of rewards such as pay, benefits and perceived work-life balance.

The investment metric was first put to the test in 2022 when it was made investible through three exchange traded funds (ETFs) run in partnership between Irrational and Harbor Capital. The flagship ETF, HAPI has outperformed 90% of its peer funds since its launch. More recently, HAPI rose 12.3% in the first quarter of 2024, beating the S&P 500’s 11%. It surpassed the S&P in 2023 as well, increasing 30% while the index grew 26%.

As a response to the pandemic, many companies introduced flexibility and wellness programmes, signalling that there was widespread recognition that a supported employee is a more productive one. Recent years have seen a withdrawal of these measures but stories like that from Irrational Capital show that there remains a strong correlation between employee satisfaction and company performance. The S&P Global (US-based rating agency) now includes employee happiness, job satisfaction and stress at work as part of its ESG evaluation for companies.

INSIGHTS FROM THE RESOLUTION FOUNDATION 

Summer boost for real-terms income: 
Research released earlier this month by the Resolution Foundation found that falling inflation led to a 2.2% real-terms income boost for workers over the summer. Private sector wage growth slowed to 5.6%, thereby easing concerns over inflation fueled by pay rises.

Yet, despite these gains, the labour market is starting to show signs of weakening with falling job vacancies and employment. Separate data showed that overall salaried jobs grew at their slowest rate since 2021.

| real-terms income: an estimation of an individual’s spending power in the market after accounting for inflation.
| wage growth: the wage growth referred to above is nominal wage growth, which is the amount earned by individuals not adjusted for inflation.

Upcoming Event: Autumn Budget Challenges
The Resolution Foundation is hosting a panel of speakers who will be discussing some difficult decisions the new Government faces in its first Budget. This upcoming fiscal event is expected to include higher taxes, increased borrowing or spending cuts to restore public finances. Our expert panel will weigh in on how the Government can navigate the challenges facing the country and the impact of potential decisions on working families.

If you’d like to learn more, come join us at Tough Medicine: Assessing the Chancellor’s options in her first Budget on Monday October 14th at 9:30 am at the Resolution Foundation at 2 Queen Anne’s Gate, London SW1H 9AA.

GET INVOLVED 

WorkerTech networking
We’re hosting a Workertech Meet-up and Drinks on Tuesday 1st October at the Resolution Foundation. Register here to come along and meet other WorkerTech founders, investors, experts and stakeholders in making better work in the UK.

Apply for investment
If you’re a WorkerTech founder, you can apply for direct investment from Resolution Ventures. We accept applications on a rolling basis. Or you can book a slot in our office hours for an initial conversation.

Portfolio hiring 
Several of Resolution Ventures portfolio companies are hiring. They’re looking for brilliant people who want to get stuck in and solve problems that better the world of work for everyone. Find out more below:

• Jobs at Breakroom 
• Jobs at Organise
• Jobs at Mobilise 

Other funding opportunities
GoodTech ventures are opening up their Cohort 3 applications at the end of September, but you can registere now for updates and complete an Expression of Interest form: https://www.goodtech.ventures/c/news-and-insights/new-cohort-3-applications-opening-soon

Impact Shakers applications are also open for their Pitch Competition on 13 November. Applications close 14 October: https://summit.startupguide.com/pitch-competition-2024

Co-operatives UK – the UK’s network body for organisations that operate as co-ops – is holding their third annual Co-op Hackathon on 1st – 2nd of October. This Hackathon is focused on creating connected digital infrastructure to boost the effectiveness of ethical co-operative businesses. It’s free to attend and will be taking place at Co-op UK’s headquarters in Lichfield, Staffordshire. Those wanting to attend can register their interest here.