The need for change
The UN’s Intergovernmental Panel on Climate Change published a report in August 2021 on the urgency of the task of combatting the effect of human activity on the climate. António Gutteres, the UN Secretary General, described the report as “a code red for humanity”.
The climate emergency will drive change across the world and force a more sustainable approach to business. The year 2021 has seen a succession of extreme climate events, with record snowfall in Madrid and Texas; exceptional temperatures in the Mediterranean countries, the Pacific North West and Russia; and flooding in New York, Germany, China and London. The World Meteorological Organisation has reported a five-fold increase in weather-related disasters over the last fifty years.
Eyes will turn, once again, to steps being taken to address the climate emergency when the COP26 conference takes place in Glasgow in November this year.
Organisations will need to react to the climate emergency in two key types of way:
(1) they will need to take steps to prepare for, and respond to, the consequences of climate change including increasing temperatures, rising sea-levels and shock weather events such as extreme temperatures and flooding; and
(2) they will need to take steps to reduce greenhouse gas emissions to mitigate future global warming.
How the consequences of climate change may impact the world of work
Some organisations will need to assess the locations from which they operate. The threat from rising temperatures to workplaces in countries such as the US has led to the Union of Concerned Scientists to warn that, in 30 years’ time, nearly 60% of outdoor workers in the US could experience at least one week each year when it is too dangerous to work.
It is not only extreme heat which promises to impact on employers in the years ahead. Locations at lower risk of extreme temperatures will nonetheless experience gradually increasing heat, leaving many indoor workplaces ill-equipped to cope with the hotter weather. There is no maximum temperature above which it is too hot to work in the UK, but the Management of Health and Safety at Work Regulations 1999 require employers to make a suitable assessment of health and safety risks and to act where necessary and practicable. It is a criminal offence for employers not to protect workers from risks to their health and safety. The UK’s enforcement body, the Health and Safety Executive, makes it clear that workplace temperature is a potential hazard that employers should address to meet their legal obligations. Employers may face personal injury claims from staff who have suffered from a negligent failure to protect them from risks.
Air conditioning (a significant contributor to greenhouse gases in its own right) is absent in many British workplaces. Designing buildings to use less energy for heating and cooling will no doubt be an increased feature of workplace design in the future (see Reimagining the office of the future and In Conversation with...Philippa Wagner). More immediately, employers grappling with the new normal of hybrid working for office-based workers are starting to consider the issue of sustainability. Is homeworking better for emissions when you remove the commute? Or is green commuting to a green office better than us all individually heating or cooling our homes?
Those who rely on goods and services from locations at risk from dangerous levels of heat and other extreme weather events will need to assess the resilience of their supply chain.
Employers looking ahead will want to assess the risk of places in which they operate to rising sea levels. A recent report by Nestpick assesses Bangkok, Ho Chi Minh City and Amsterdam as being the three cities most at risk, with Cardiff at sixth, the only British city in the top 20 (London is 22nd).
In some sectors, such as agriculture or forestry, climate change will directly affect work. Growing certain produce which has thrived for millennia in certain locations will no longer be viable, but may be better suited in future years to new locations.
Reducing emissions, employment law and practice
The second part of an employer’s environmental strategy will be to reduce their environmental impact, in particular to reduce the greenhouse gas emissions associated with their activities and the activities of their supply chain.
There are several drivers influencing employers in their development and implementation of environmental sustainability strategies. There is the push and the pull.
As far as the “push” is concerned, for many organisations, reducing carbon emissions will be a priority because it is the responsible thing to do and because it makes good business sense.
The “pull” is coming, and will only increase, from various directions. It is coming from government through legislation and it is coming from numerous stakeholders including employees, trade unions, customers and investors.
How employment law is adapting
To date, there are few employment laws requiring organisations to take account of the climate emergency. This may change in future. New laws in France oblige employers to inform and consult with their Social and Economic Committees on the environmental implications of business decisions affecting the workforce. How long before we see similar consultation requirements in other jurisdictions?
Change may also come from the increasing political influence of Green party politics. Public concern about the climate emergency is driving the advance of Green political parties across the world, while other traditional parties may be adopting more green policies. This could have profound repercussions for employment law because, as explored in depth in this research piece, Green parties tend to promote employment laws that involve increased rights for workers and a greater role for trade unions. In other words, increased Green party influence in governments could pave the way for radical employment law reform across a whole range of issues from family friendly policies to minimum wages.
A notable legal development will come with the coming into force of EU directive 2019/1937 on the protection of persons who report breaches of Union law (the Whistleblower Protection Directive) which EU member states must enact into domestic law by the end of 2021. The UK has had similar laws for over 20 years. The Whistleblower Protection Directive protects employees and other stakeholders who disclose suspected breaches of EU environmental laws. The current trend is for countries to extend the scope of their implementing legislation so that it covers breaches of domestic law or issues of public interest (such as in Sweden, for example, where the proposed implementing legislation covers disclosures about any matters of general interest). The Directive will result in a new EU-wide framework for raising concerns about an organisation’s environmental practices, with organisations being obliged to investigate concerns raised and provide feedback to the whistleblower.
The UK Employment Appeal Tribunal (EAT) ruled in Grainger v Nicholson (2010) that belief in climate change was potentially protected under the UK equality laws which prohibit discrimination on the grounds of religion or belief. Mr Nicholson claimed that he had been selected for redundancy on account of these beliefs. To be covered as a protected belief the EAT decided that: (i) the belief must be genuinely held; (ii) it must be a belief and not an opinion or viewpoint based on the present state of information available; (iii) it must be a belief as to a weighty and substantial aspect of human life and behaviour; (iv) it must attain a certain level of cogency, seriousness, cohesion and importance; and (v) It must be worthy of respect in a democratic society, be not incompatible with human dignity and not conflict with the fundamental rights of others. The EAT agreed that Mr Nicholson’s climate change beliefs could satisfy this test. This ruling gives important protection to employees who claim that they have been disadvantaged at work on account of their commitment to addressing climate change.
Stakeholder pressure is increasing, including from the workforce
Arguably the biggest driver of change is pressure from stakeholders, including the workforce.
Customers are, to an increasing extent, taking environmental impact into account in making purchasing decisions. Social media means that information and opinions can be disseminated widely and quickly from concerned parties. Prospective clients increasingly demand detail about an organisation’s environmental policies and impact in procurement exercises.
Investors look to a company’s environmental credentials (including the environmental impact of its supply chain) in deciding where to put their money. An organisation’s ESG (Environmental, Social and Governance) performance is now regularly scrutinised before investment decisions are made. Rating agencies now report on ESG criteria. Various accreditation organisations have appeared to validate businesses’ credentials, and certified B Corps are increasing in number.
The UK government is currently consulting on requiring all publicly-quoted companies, large private companies and Limited Liability Partnerships (LLPs) to comply with climate-related financial disclosure obligations. Premium listed companies are already required to comply with the recommendations of the UK’s Task Force on Climate-related Financial Disclosures, or to explain their lack of compliance. We are beginning to see performance against environmental targets featuring in executive pay decisions, a trend which is only likely to grow.
Overstating your green credentials is, however, risky. The UK’s Competition and Markets Authority is cracking down on “greenwashing” with a new Green Claims Code. False or exaggerated claims are likely to undermine employee trust and make it harder to recruit talent. In extreme cases, it could even lead to whistleblowing or unfair constructive dismissal claims by employees who have joined or stayed with an employer on account of their sustainability claims or employees who complain that their organisation is not living up to its environmental claims.
Environmental credentials more and more influence someone’s choice of employer. If employers are to attract and retain the best people then they will be unable to ignore this. A recent Deloitte survey revealed that 49% of Gen Z respondents and 44% of Millennials claimed to have made choices about their work or the organisations they would work for based on personal ethics.
Trade unions are lobbying governments and employers to do more to meet climate targets. The UK TUC has published a report warning about the impact on jobs if companies fail to meet climate goals, with jobs being moved overseas to meet company targets.
How employment practices are changing
Employers are already taking steps to encourage behaviours which reduce carbon emissions. The aftermath of the Covid pandemic is presenting opportunities to “build back better” by retaining some of the climate-positive changes forced upon employers by the pandemic. For example, companies are exploring more cycling to work, less business travel by plane and more homeworking (although see above on environmental impact of homeworking).
The Chancery Lane Project is an interesting initiative aimed at encouraging climate-aligned legal drafting. The project has created a variety of employment-related clauses, including clauses for a Net Zero Employment Handbook and Climate Garden Leave.
We are already seeing employers looking to adapt employee benefit and expenses strategies to promote their environmental credentials, attract and retain employees motivated by action in this area and take advantage of tax efficiency schemes for non-cash benefits such as cycle-to-work schemes, e-vehicle schemes and workplace charging points.
In future, we may see more paid time off work to engage in activities to address the climate emergency. Employers may make training on the climate emergency mandatory, as they often do with training on issues such as diversity and inclusion. Another target is environmentally damaging uniforms.
Italy has introduced laws requiring large companies to engage “mobility managers” whose responsibilities now include reducing use of private cars for commuting to work and promoting sustainable mobility. As employers become increasingly conscious of their carbon footprint, might we even see recruitment decisions influenced by the environmental impact of a potential recruit’s commute?
The climate emergency elicits very strong views and, like many issues these days, limited tolerance for opposing views. The BBC recently reported that nearly 60% of young people said that they felt very worried or extremely worried about climate change and more than 45% of those questioned said feelings about climate change affected their daily lives. Many staff will have demanding expectations of their employer and colleagues.
Employers may find themselves at the forefront of changing attitudes and on the firing line in managing any resulting conflict between employees. Employees may increasingly want to speak out at work about a variety of societal, political and environmental issues. If you have taken a particular commercial stance on the environment then employees may feel more empowered to voice climate-related opinions in the workplace, potentially leading to conflict.
How long before certain actions which are lawful and generally uncontroversial become, nonetheless, socially unacceptable – for example long-haul holidays or commuting in a polluting vehicle? What about consuming meat or dairy products, with livestock farming contributing significantly to greenhouse gas emissions?
Will employers start regulating employee behaviour out of work? Staff rules often provide for disciplinary action if an employee has been guilty of conduct outside work which might damage the employer’s reputation. Might that soon extend to regulating behaviour outside work that contributes to global warming or is in conflict with an organisation’s environmental strategy?
In September 2019 millions of employees across the world were invited by climate activist Greta Thunberg to strike to promote immediate action on climate change. In the UK, an employee joining such action would be taking unofficial industrial action which would amount to an unauthorised absence liable to disciplinary action, but many employers took a supportive stance with some giving staff time off to take part. This type of organised protest may be an increasing feature of the years ahead.
Conclusion – climate as the biggest driver of change?
The type of work we are employed to do is changing rapidly. Various factors are driving this evolution not least technology. Many of the best brains are working on developments to address the impact of climate emergency and its causes. The Guardian has reported analysis showing that the UK’s green economy is now worth more than £200bn; employs more than 1.2 million people; and is four times the size of the UK’s manufacturing sector, with further growth anticipated in the years ahead.
New jobs will also be created closer to home as greater attention is paid to the environmental credentials of an organisation’s supply chain. Environmental factors will play a role in decisions to reverse off-shoring of manufacturing, with supply chains and manufacturing plants moving closer to production and consumer.
Meanwhile, employers can be expected to adopt employment policies that are aligned to their climate goals, driven by workforce pressure and the need to attract and retain employees in a world where staff are demanding more urgent action on climate change.
The climate emergency therefore promises to represent an increased priority for employers in the years ahead whether adapting to the consequences of climate change or taking steps to reduce greenhouse gas emissions. The world of work is changing profoundly and rapidly, as various drivers of change come together. Climate change is, arguably, the most significant driver of change of all.