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Government loses appeal over Poundland work scheme Government fail to overturn Poundland work scheme ruling
(35 minutes later)
The government has lost a Supreme Court appeal over a ruling its flagship "back to work" schemes were legally flawed.The government has lost a Supreme Court appeal over a ruling its flagship "back to work" schemes were legally flawed.
Work and Pensions Secretary Iain Duncan Smith failed in a bid to overturn an earlier ruling that regulations underpinning the schemes were invalid. Ministers failed in a bid to overturn an earlier ruling that regulations underpinning the schemes were invalid.
The case was brought by former Poundland worker Cait Reilly, who claimed that requiring her to work for nothing breached laws on forced labour. The case was brought by graduate Cait Reilly. She also claimed that requiring her to work for nothing at a Poundland store breached laws on forced labour.
David Cameron said they were an effective way of getting people work. But employment minister Esther McVey said the judges had specifically rejected claims of "slave labour".
But critics have said they amounted to "slave labour" because they involved work without pay and cuts in jobseeker's allowance for those who failed to comply with the rules. Critics have said the schemes are unfair because they involve work without pay and cuts in jobseeker's allowance for those who failed to comply with the rules.
Five Supreme Court justices upheld a Court of Appeal decision which went against the government in February. Five Supreme Court justices upheld a Court of Appeal decision which went against the government in February, because of shortcomings in the way the schemes were explained to those taking part.
However, the Supreme Court ruled that regulations did not constitute forced or compulsory labour. But the Supreme Court rejected a counter-appeal against the scheme and upheld the Court of Appeal's ruling in the government's favour that the regulations did not constitute forced or compulsory labour.
Ministers have brought in new rules allowing these unpaid schemes to continue while it appeals. 'Won the argument'
But the judges' decision could effectively prevent the government continuing with the programme in its current form. Ministers had brought in new rules allowing the unpaid schemes to continue pending the outcome of the appeal.
Ms McVey rejected suggestions that the ruling was a blow for the government, describing it as a "victory for common sense".
She told the BBC that the government had listened to the concerns about the schemes and would introduce further safeguards to clarify what was expected of those taking part.
But she insisted that judges had backed the fundamental basis of the scheme - to give people experience of holding down a job - and the potential use of sanctions.
"First and foremost, it is about getting people into work and supporting them the best we can and we are doing a very good job of that," she said.
In a statement, the Department of Work and Pensions said the Supreme Court had "unanimously upheld our right to require those claiming jobseeker's allowance to take part in programmes which will help get them into work".
"We have always said that it was ridiculous to say that our schemes amounted to forced labour, and yet again we have won this argument," Work and Pensions Secretary Iain Duncan Smith said.
Public Interest Lawyers, which represents Ms Reilly - who now works part-time in a supermarket - said she was "delighted" about the court's judgement on the legality of the regulations.