In 1887, a British soap baron began casting around in Cheshire for a new site from which he could expand his booming business. William Lever – the man whose surname makes up part of the multinational, Unilever – alighted upon 56 acres near a railway station and the River Mersey.
Here Lever brought to life his dream: a beautiful model village to house his workers, named Port Sunlight after his company’s most popular product. Comprising 800 houses and amenities like a hospital and art gallery, Lever’s workers also benefited from welfare, educational and recreational schemes funded by their employer. It was a far cry from the existence of the average Edwardian factory employee, crammed into grimy and overcrowded accommodation.
Lever – later Lord Leverhulme – exemplified the lottery facing workers before the solidifying of the modern welfare state. If blessed with a ‘philanthropic’ boss, some employees were given welfare and patronage, linked to their employment status. Yet if you happened to be one of the millions of workers that were the rule, not the exception, you could expect almost nothing from employers, instead relying on the meagre state welfare provisions that existed at that time, and private charity.
Just over a century after Lever completed the construction of Port Sunlight, Britain’s landscape of welfare and work is shifting into a framework the soap multi-millionaire might not find unfamiliar. In-work poverty has soared; the majority of people living below the breadline are from working households. An economic crisis is tightening the screws on just about every strata of society, but it is those in low-income brackets who face being completely crushed by inflation and the spiralling costs of everything from rent to energy bills. Meanwhile, the safety net of the welfare state has been reduced to frayed strands.
Against this backdrop, some employers have begun to reinvent themselves as modern William Levers, adjusting the ‘perks’ they offer their workers to include the likes of healthcare, income protection and increased pension contributions. In the face of an eroded welfare state, what once may have been considered attractive, additional extras are now becoming vital benefits – a one-stop workplace welfare state – and further skewing the balance of power between employer and worker.
Ben*, a 25-year-old working in online safety and policy, says his job has given him access to life-changing healthcare.
“You get private healthcare and access to counselling, which is presented as a separate thing to primary healthcare,” he says of the package. “You also get an annual check-up, where they do a full body screening”.
His workplace also offers a £1,500 ‘bonus’, which can be taken as cash, or exchanged for various benefits, such as dental insurance, a bike scheme or pension contributions.
Ben, who comes from a low-income background, was nervous to utilise the private healthcare offer at first in case he ended up having to “foot some of the bill”. But after urging from colleagues, he finally decided to bite the bullet and address a long-term hip mobility issue that he’d been unable to get treatment for on the NHS.
“It was causing me a lot of pain,” he recalls. “I’d spoken to my GP about it, about five years ago. They had been really frank with me and said, ‘this isn’t a serious enough injury, it’s not sufficiently inhibitive to your quality of life to be prioritised on the NHS’.”
Via his new workplace’s healthcare programme, Ben was finally able to visit a physiotherapist.
“I had a free programme of physio[therapy] that lasted as long as I needed, about six months,” he says. “It’s had a massive impact on my life […] My mental health has massively improved [too].
“Ironically, I’m [now able] to start training for a marathon to fundraise for my sister who is trans, and needs access to healthcare. Her level of income is far lower than mine and she has absolutely no means of accessing equivalent care.”
Ben now plans to take up the offer of counselling. Previous experiences with NHS counselling saw him having to wait the better part of a year for six sessions to treat the anxiety and depression he suffered with. After they finished, he was judged not to be in “a dire enough situation” to warrant further appointments. If he had the choice, Ben says, he would use the NHS for his healthcare needs. But long waits mean it’s no longer practical when his employer offers access to immediately available care.
All these welfare schemes mean that Ben’s attachment to his workplace has deepened.
“I evangelise it as an organisation to work for, honestly,” he admits. “It feels like they really care about you. It makes me feel very settled and willing to stay. I haven’t joined the union here [yet], even though I’m a member of Acorn [a tenants union] and a big advocate for them”.
“It makes me angry, really, really angry,” says Ben, of the welfare perks lottery. “The quality of life I have is so tied to my workplace. But all these people I love can’t be as relaxed as me, even though they live in the same society and come from similar backgrounds.”
It’s a similar story for 29-year-old Liam who recently began a role at a large health research organisation. His new employer offers a comprehensive benefits package, including a 15% contribution to a pension plan, income protection in case of prolonged illness and disability, access to private healthcare and mental health support. Specialist care pathways within the private care provisions include everything from menopause-related and chronic conditions, to gender transition healthcare and a private GP service.
“They brought the GP service in this year,” says Liam. “They haven’t specifically said it’s in response to growing [NHS] wait times but it feels connected.”
The benefits have already had a “huge” impact on Liam’s quality of life, he reports.
“Bleak, but one of the biggest things I was excited for when starting the job was the private healthcare, even more so than the job itself,” he says. “It was a safety net I felt I had not had”.
Liam is disabled and says he regularly accesses NHS healthcare. Towards the end of 2021, a chronic condition increased the frequency with which he needed care.
“I was referred to a specialist in September  and was told I’d receive a letter confirming my referral within six weeks,” he says. “To this day, that letter has not come through.
“Thankfully, I no longer need to see the NHS specialist because I found by having physiotherapy, the condition has improved. But I was only able to get physiotherapy because I have a private health insurance provider [through my work].”
There is absolutely “no way” Liam would have been able to afford private healthcare without his job, he adds. “Prior to this job, I was on Universal Credit for six months when I suddenly became unwell. That was one of the scariest points of my life. There was no safety net”.
These welfare provisions mean Liam feels bound to his workplace.
“I will not move on from this job unless I can get one somewhere with comparable benefits,” he says. “Now I’ve experienced the palpable relief [and] sense of security, I do not want to go without it again. It makes me really sad. These should not be benefits. These should be adequate resources provided by the state.”
Part of the reason for the welfare reforms of the post-war Labour government, was to ensure that workers weren’t reliant on their employers to provide for their wellbeing, says professor Pat Thane, an expert in 20th-century labour movements and the welfare state.
“That was part of Labour’s objective,” she tells Novara Media. “[The welfare state] gave more people a sense of independence, so that they weren’t so dependent on employers.”
Before the reforms, state welfare in England and Wales took limited forms, such as the Poor Laws. The 1834 overhaul of Poor Law legislation saw an even stricter approach taken, with ‘able-bodied’ unemployed people unable to access state support unless they entered a workhouse, where they were made to labour for their keep.
“It was very restrictive and assumed that people were poor because they were feckless idlers and it was their own fault,” says Thane. “It was meant to force people into work, because benefits were so punitive”.
In the late 19th and early 20th centuries, private charity and employment – such as domestic service, which offered working class women regular meals and a place to sleep – were the main channels through which people could access a form of welfare support beyond their weekly pay.
“A number of people took up philanthropy,” says Thane. “A lot of middle and upper-class women who weren’t really allowed to work for a living but wanted to do something with their spare time. There were always some generous employers who wanted to support their workers, but many others who didn’t. It was really variable from place to place”.
It’s to be expected that 21st-century employers are stepping into the breach left by the erosion of the welfare state, says Amelia Horgan, author of the acclaimed Lost in Work.
“A ‘perk’ is socially relative,” she says. “It has to be something you won’t get elsewhere. It’s no surprise that as the welfare state recedes, employers are offering things traditionally provided by the state”.
Employers interested in retention may turn to a modern version of ‘company towns’ in answer to a workforce facing a housing crisis, Horgan predicts. Companies may begin more frequently offering housing schemes to cash-strapped young renters, where the employer is “involved in your housing or subsidises it in some way, to make it possible for people to afford to live,” she says.
But it won’t be workers in minimum wage jobs who have access to these sorts of benefits, she adds.
“What we [will] see is a deepening of a segmented workforce,” Horgan says. “Employers with these perks tend to be large employers, because they can bear those sorts of costs. And employees who are expensive to replace [will receive these perks].
“So we will see a divide of an already divided workforce. Some of that will be along the lines of gender, some will be on education, some of that might be [based on] class background”.
In short, the roles that provide welfare support as part of the employment package are more likely to reflect existing inequalities. It’s an assessment Pat Thane agrees with.
“I’m sure it will increase inequalities,” she says. “[Employers] will only do that for their better paid, ‘more important’ workers.
“Before we had the post-war welfare state, employers provided occupational pensions and access to healthcare sometimes, but it was for the workers they really wanted to hold on to.”
Successive Conservative governments have also “encouraged” employers into becoming responsible for the welfare of their workers, notes Thane.
“Particularly since the 1980s,” she says, of Margaret Thatcher’s reforms, which gave tax relief to employers who provided private medical insurance and occupational pensions.
“And,” Thane adds, “it’s mainly male workers who benefit from these things”.
Neither of Britain’s two dominant political parties looks likely to address the decline of the welfare state any time soon, Labour because they’re not in government (and their current policy is “mitigation”), and the Tories because they are the architects of the attempted return to pre-1945 state welfare conditions.
Horgan suggests trade union social funds, historically an alternative to employer provisions, might make a comeback. Before the First World War, members contributed to funds held by their union and received pensions and unemployment pay in return.
But that’s unlikely to be an immediate option, says Pat Thane. “[Social funds] aren’t a viable [alternative] at the moment because union membership has been so crushed. Unions provided a great deal of [welfare] until 1945, then the state took over.
“Unions could provide again, but they cover such a limited section of the workforce at the moment and often not the poorest and least ‘skilled’ workers.”
Until then, more people are likely to find the quality of welfare they can access depends upon their job.
“Now I’m in this role, life feels so much easier that it makes me angry,” says Liam. “Now I’ve got a decent salary, [I have] access to all these things I needed 10 times more when I had no salary.
“It makes me want to hold the government to account to ensure everyone can have access to the quality of care and income protection and pension I have through my employer. This should be available to every single person in the population”.