Goldman warns the UK may lose the right to abuse its workforce if it has a Labour government

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The FT overnight emails contain two interesting headlines. The first says:

Screen Shot 2015-04-22 at 04.46.38

I will ignore Johnson in the related story. Its Goldman Sachs element says that:

Goldman Sachs has warned that a Labour-led government is likely to spark a sell-off by investors, adding its voice to City concerns about the prospect of Ed Miliband in Downing Street.

The US investment bank listed the Labour party's plans to freeze energy bills, raise taxes and curb zero-hour contracts as policies likely to alarm investors, while noting that the Scottish National Party could drag Mr Miliband further to the left.

It add that:

Labour's plans might mean that Britain's flexible labour market could be compromised “by promises to abolish so-called ‘zero hour contracts' and interventions in markets”.

Is that the 'flexible Labour market' that was referred to in another FT story? Here the headline was:

Screen Shot 2015-04-22 at 04.48.05And the story noted:

A senior banker at Goldman Sachs who claimed she was cheated out of millions of pounds in bonuses and subjected to sexist comments has reached a confidential settlement with the investment bank – just before her employment case was due to start.

Sonia Pereiro-Mendez had claimed she was discriminated against after telling her managers she was pregnant.

I have little doubt the settlement was costly: Sonia Pereiro-Mendez had recorded conversations about which she had taken offence.

Now, of course all organisations make mistakes but discrimination against women in banking (and elsewhere, of course) has always looked like systemic abuse (there are just too many cases now for it to look like anything else)  and the term 'flexible labour market' has always had the feel of also being systemic abuse.

So, two thoughts. Do we really value comment from an organisation that in this case is putting a specific value on exploitation of the UK workforce?

And, less importantly but also appropriately, do we or should we place value on a bank that has such little faith in the wisdom of markets that it thinks that the entire risk of a Labour / SNP related government has not already been priced by the market? If it hasn't been then there are a great many people in the City who have clearly not been reading the opinion polls, and I don't believe that, in which case this claim is just pure hype and bears no relationship to reality.

So let's put more weight on the second story which clearly did relate to real events. And dismiss the comment for that reason instead.


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