RICHARD Leonard has backed the devolution of employment law as part of an overhaul of workers’ rights and a move to a more state-directed economy.

The Scottish Labour leader said his party would reintroduce collective pay bargaining across broad swathes of business and if it formed the next government at Holyrood.

Setting out an industrial strategy at the STUC congress in Dundee, Mr Leonard said Labour would also deny public contracts to employers who dodged tax, failed to recognise unions or mistreated staff.

Paying a real living wage of £10 an hour would also be compulsory for contractors.

Some of the plans envisaged a post-Brexit world, confirmation that he continues to support leaving the EU, despite almost two-thirds of Scots backing Remain in 2016.

His plans would also require the consent of the UK government.

The SNP said it welcomed support for devolving employment law, but said it was bizarre that Mr Leonard was backing a Brexit which could “lay waste to Scottish jobs”.

The Tories said Labour's plans were a recipe for higher taxes.

Mr Leonard’s conversion to devolved employment law comes after the SNP repeatedly attacked him for complaining about bad employers while leaving decisions to Westminster.

The STUC has also called for the devolution of employment law for many years.

Employment law includes the minimum wage, tribunals, parental leave, flexible working, unfair dismissal, redundancy payments and equality at work.

It is devolved in Northern Ireland, but it is the same in England, Wales and Scotland.

In the wake of the 2014 independence referendum, the Smith Commission on greater devolution rejected calls to move responsibility from Westminster to Holyrood.

It said there was a risk of a “race to the bottom on worker protection, potentially resulting in the reversal of great advances for workers’ rights”.

In his speech to the opening day of the Congress, Mr Leonard said he would avoid that by guaranteeing there was no loss of existing rights.

He said: “We will protect and strengthen workers’ rights by seeking the devolution of employment law in which we will set a pre-Brexit floor to ensure that workers in Scotland are not caught up in a race to the bottom.”

Mr Leonard, whose party has lost support in the polls since he took over 18 months ago, said he would appoint a Cabinet Secretary for Labour if he became First Minister.

He said: “My aim as the leader of the Scottish Labour Party is not to simply lead a better management team than the SNP.

“It is to lead a Scottish Labour Government worthy of the name.

“Committed to bringing about a real shift in power and wealth including an extension of industrial and economic democracy.”

He said Scottish Labour wanted “new sectoral bargaining arrangements”, meaning state-driven collective bargaining across whole industries or parts of the economy to regulate pay, pensions, overtime and conditions, rather than leaving it to the market.

Sectoral bargaining could also see the end of zero-hours contracts.

In 1979, around 80 per cent of UK workers were covered by collectively bargained terms, but that is now down to 20%, compared to a Europe-wide average of 60%.

Mr Leonard said: “A future Scottish Labour Government under my leadership will not only establish sectoral collective bargaining we will establish sectoral industrial and economic planning as well as part of a long overdue industrial strategy for Scotland: bringing together trade unions, employers and government.”

He said Labour would also make good employment practice - and trade union rights - a condition of qualifying for public contracts and grants.

He said: “We will stand on a manifesto in 2021 that makes the real living wage and labour standards, including trade union rights not a voluntary arrangement or an optional extra in public procurement and public assistance

“We will make it a compulsory requirement and an inescapable obligation in public procurement and public assistance. If you deploy tax avoidance and tax evasion... then you will not win public procurement contracts and you will not receive governmental support.”

On the likely EU elections on May 23, he said: “Do not allow this election to become a false choice between competing nationalisms: British and Scottish. Do not simply be a voter. Be an activist. Join the campaign to defeat the right wing populism of Farage and UKIP, and help build a movement for radical reform and real change in the EU.”

SNP MSP Tom Arthur said: “This was a perplexing speech, in which Richard Leonard tried to pretend he’s not a Brexiteer like Nigel Farage.

“The fact is that he’s happy to lay waste to Scottish jobs by crashing our economy out of the EU and its single market, which is eight times the size of the UK alone.

“The SNP will always welcome support for further devolution of key powers to Holyrood - but it’s hard to understand why Labour want to stop at employment law when transferring all economic levers to Scotland could truly help us to transform our economy, stop the damage of Brexit and create jobs.

“The Labour party continues to languish a distant 22-points behind the SNP in the polls and, with this current leader at the helm, there’s little hope of a recovery any time soon.”

Tory MSP Murdo Fraser said: "The last thing Scots need is to be hit with further taxes.
“Instead what we need is a tax regime that will encourage investment and help grow the economy so we can better pay for vital public services.

“Unfortunately none of the ideas outlined by Richard Leonard in his speech will provide the help our economy needs. It shows once again just how out of touch he and his party are when it comes to the important issues facing Scotland.”