New rules and new plans in universal credit (UC) mean an increase in conditionality for significant numbers of working claimants. Simon Osborne explains.
Introduction
UC claimants may be required to undertake certain ‘work-related’ activity as a condition of their receipt of UC, on pain of a sanction for non-compliance. This (together with the requirement to agree and maintain a ‘claimant commitment’) constitutes the conditionality regime in UC.
The work-related activity is not precisely specified in the rules. But it is defined in law in terms of the following broad categories: work-focused interviews, work preparation, work search and work availability.
1s13 Welfare Reform Act 2012 (‘WRA 2012’) Some claimants (eg, those responsible for a child aged under one, those with ‘limited capability for work- related activity’ and those who are already earning enough) are completely exempt from such conditionality. Others (eg, those with limited capability for work) are required only to undertake work-focused interviews, or work-focused interviews combined with work preparation.
2ss19-22 WRA 2012; regs 89-91 Universal Credit Regulations 2013, No.376 (‘UC Regs’)However, many UC claimants may instead potentially be required to undertake the whole range of work-related activity. These ‘all work-related activity’ claimants may still get some easement – for example, regarding their expected hours of work search, or the type of work and pay they are seeking and available for. Much of such easement is, initially at least, dependent on negotiation with the work coach. But there are some statutory grounds for easement, including for some working claimants. This is where changes have been made.
Conditionality and work – changes
One of the statutory easements is for those claimants not earning enough to be completely exempt (and so have ‘no work-related requirements’), but still earning enough from employment to be exempt from work search and work availability. This is by earning enough to meet an ‘administrative earnings threshold’.
3Reg 99(6) UC RegsIt is the administrative earnings threshold rules that are the subject of the changes discussed in more detail below. Put briefly, the new rules mean that the administrative earnings threshold level is increased so that significantly more claimants with earnings from work are to be required to engage in work search and to have (more) work availability.
In a formally separate but closely related change, the DWP intends to alter administrative arrangements in its ‘labour market regimes’ – ie, the groups in which claimants are placed to determine the level of contact and support with Jobcentre Plus.
4For the most recent setting out of the different regimes, see DWP, ‘Universal credit statistics, 29 April 2013 to 14 July 2022’, 16 August 2022, available at Specifically, under the so-called ‘light touch’ regime, in which working claimants who meet the administrative earnings threshold and, formally speaking, have work-focused interview and work preparation requirements only, claimants have in practice until now been subject to relatively little compulsory activity. (By contrast, those who are otherwise subject to all work-related requirements including work search and availability are put in the ‘intensive work search’ regime.) But things look set to change.
Conditionality and earnings thresholds
Where a claimant is not earning enough to reach the ‘conditionality earnings threshold’ and so have no work-related requirements, but is earning enough to reach the administrative earnings threshold, s/he qualifies for exemption from work search and work availability. The conditionality earnings threshold is set with reference to a claimant’s circumstances, but as a default is set at national minimum wage levels for a 35-hour week. No change has been made to those rules.
The administrative earnings threshold was set at £355 a month for a single claimant and £567 joint earnings a month for couples. However, amendment regulations have provided that from 26 September those thresholds have increased to £494 a month for a single claimant or an individual member of a couple, and £782 joint earnings a month for couples.
5The Universal Credit (Administrative Earnings Threshold) (Amendment) Regulations 2022, No.886; DWP, Numbers Moved to Universal Credit’s Intensive Work Search Regime Because of the Increase in the Administrative Earnings Threshold, 5 August 2022, available at gov.uk These increased thresholds apply to all claims, both new and old: there is no transitional protection for claimants who already came under the old thresholds.
The effect of the rule changes
Working claimants must now be earning more in order to benefit from the easements provided by the administrative earnings threshold. Those now not earning enough to reach that threshold, including those who formerly met the lower threshold for the administrative earnings threshold, can (barring qualifying for any other sort of easement or exemption) be required to undertake work search and be available for more work – as well as being required to attend work-focused interviews and engage in work preparation.
Statistics from the DWP indicate that the expectation is that 114,000 UC claimants will, as a result of the rule changes, move from the ‘light touch’ regime to the ‘intensive work search regime’ – ie, as a result of no longer meeting the administrative earnings threshold and so also becoming subject to work search and availability. The official intent is said to be to restore the original ‘parity’ of the administrative earnings threshold with the national minimum wage, and that in future the threshold will continue to increase in line with the minimum wage.
6 The Explanatory Memorandum to the regulations that amended the administrative earnings threshold
7See note 5 says that the 114,000 constitutes 16.5 per cent of light-touch claimants, and that: ‘This change will require impacted claimants to review and agree a new claimant commitment with a work coach, agreeing appropriate work search requirements which will be revised and updated regularly.’
In a subsequent development, as part of the ‘Growth Plan 2022’ announced on 23 September, the Chancellor said that from January 2023 the administrative earnings threshold would be further increased, to equate to 15 hours a week at national minimum wage level for single claimant, and 24 hours a week at that level for a couple. Also, the government would be ‘strengthening’ the UC sanctions regime.
The light touch regime itself is also set for change (see below). But note that although that regime and the intensive work activity regime are administrative in nature, the change to the administrative earnings threshold is statutory. That means that the increased conditionality for working claimants who do not meet the threshold is a matter of law, not merely their administrative classification by the DWP.
Light touch – in theory and in practice
The ‘light touch’ regime, as with the other labour market regimes, is in itself administrative. In short, it is not defined by or provided for in the law. Exactly what is supposed to happen and what has in practice happened to claimants in the light touch regime has been the source of some uncertainty and confusion. We do know that (due to satisfying the administrative earnings threshold) claimants within it cannot, as a matter of law, be required to undertake work search or be available for more work.
8Reg 99(6) UC RegsBut practical experience of work-focused interview and work preparation activity in the light touch regime has varied. Formerly at least, some claimants in the regime were required to attend very few work-focused interviews and little else, which seems to have been the official intent; whereas others have experienced significantly more pressure, at least to attend work-focused interviews. No breach of rules seems to have been involved. But there may have been problems with claimants ostensibly in ‘light touch’ apparently being placed in another of the DWP’s labour market regimes, such as the ‘work-focused interview’ or ‘work preparation’ regimes that apply, for example, to some claimants with young children.
Light touch – regime change ahoy
In any case, the DWP says that the light touch regime is to change. At time of writing, little official detail of the change was available, but we did have this on what ‘light touch’ was supposed to have meant, with a hint of change: ‘Those in [intensive work search] are required to undertake all work-related requirements, whereas until now, those in light touch have not been required to have regular contact with Jobcentre Plus and as such have had no work-related requirement placed on them or the opportunity for support which access to a work coach provides.’
And this, with a little more on what is to change: ‘From September this year, DWP will be developing a new labour market regime for light touch that will enable light touch claimants to access support through the Jobcentre Plus.’
9DWP, Numbers Moved to Universal Credit’s Intensive Work Search Regime Because of the Increase in the Administrative Earnings Threshold, 5 August 2022, available at gov.ukReading those tea leaves, it would seem that the change may involve claimants in the light touch regime being required to engage in a greater level of work-focused interview and work preparation activity than previously. So conditionality, even for those working claimants who (by virtue of satisfying the administrative earnings threshold) remain in the light touch regime, seems set to increase.