§ Mr. J. Rodgers
I beg to move, in page 9, line 14, to leave out "this section" and to insert "the three following subsections".
I suggest that it would be convenient to discuss at the same time the later Amendment in page 10, line 3, at end insert:(6) The following provisions shall have effect (without prejudice to the generality of subsection (2) of this section) as respects any pension, superannuation or life-assurance scheme or fund in force at the commencement of this Act for the benefit of persons in the employment or former employment of a company to which this section applies:—When the Clause was being studied in Committee, my right hon. Friend the President of the Board of Trade said:
and references in any deed, rules or other document to the company shall be construed as, or as including, references to the said Management Corporation as may be required for giving effect to, or in consequence of, the foregoing paragraphs.
- (a) anything authorised or required to be done for the purposes of the scheme or fund after the commencement of this Act which apart from this section would fall to be done by, with or to the company or its directors shall be treated as falling to be done by, with or to the Management Corporation acting for the part of Great Britain in which the company exercised its functions;
- (b) for the purposes of the scheme or fund employment after the commencement of this Act by that Corporation shall be treated as equivalent to employment by the company, and employment after the commencement of this Act by the company shall be disregarded;
- (c) any requirement to do anything for the said purposes at the registered office of the company shall be treated, in relation to things falling to be done after the commencement of this Act, as a requirement to do that thing at the head office of the said Management Corporation;We are examining the pension schemes which the companies have been running and we shall ensure that the rights of the officers concerned will not be adversely affected by the Bill. If it is found necessary, I will table an appropriate Amendment at a later stage to cover this."—[OFFICIAL REPORT, 9th December, 1959; Vol. 615, c. 685.]The Amendments give effect to my right hon. Friend's undertaking. The first Amendment is a tidying-up. consequential Amendment only.
The second Amendment introduces provisions designed to ensure that the 1088 pensions and life assurance schemes now operated by the estate companies for the benefit of their employees will continue to operate satisfactorily after the transfer of the rights and liabilities of those companies and of their staff to the management corporations created by Clause 9 of the Bill.
Clause 13 (2) makes provision for a general transfer of the rights and liabilities of estate companies to the management corporations. This subsection effects certain of the necessary changes in the pension and life assurance schemes. It will, for example, result in the transfer to the appropriate management corporations of the obligations of estate companies to pay contributions under the scheme.
Clause 13 (2) does not, however, go far enough. It is necessary to do more than transfer the rights and liabilities of the estate companies. The provisions set out in the Amendment are required to effect the following changes. Paragraph (a) is couched in wide and general terms. It is necessary because certain of the pension schemes provide, for example, that notices in writing have to be deposited with the relevant estate company. Obviously, once the Bill comes into operation, it will be desirable that such deposits should be with the appropriate management corporation. Paragraph (a) effects this change. It also deals with the situation where the right to appoint trustees of a pension scheme is vested not in an estate company itself, but in its directors. The right would not be transferred to the appropriate management corporation by Clause 13 (2), but it will be so transferred by this new provision.
Paragraph (b) is necessary because certain of the pension schemes are so worded that the transfer of employees in the estate companies to the employment of the management corporation would have to be regarded by the trustees of the scheme as terminating their employment with the company in question and, therefore, ipso facto terminating their membership of the scheme.
Paragraph (c) deals simply with matters requiring to be done under pension schemes at the registered offices of an estate company. It provides that they should require to be done at the head 1089 office of the appropriate management corporation.
The last three lines of the Amendment provide for the necessary textual changes to be made in the light of the provisions of the Amendment when reading any document connected with the pensions or life-assurance schemes.
I hope that the House will accept the Amendments. I think that they are in line with the undertaking which my right hon. Friend gave.
§ Mr. Charles Loughlin (Gloucestershire, West)
The Minister has gone a great deal of the way to meet some of the criticisms made in Committee by the hon. Member for Crosby (Mr. Page) and myself. He has not gone the whole way, and I am wondering whether, even at this stage, it would be possible for him to look again at one of the other problems that arise over the transfer of staffs from the old companies to the new corporations.
Two points arose when we discussed this matter in Committee. One was the question of the pension schemes applicable to the staff, and the other, which was in two parts, concerned, one, the changing or possible changing of status of some members of the staff, and two, the possible redundancy of some other members of the staff. The Minister then indicated quite clearly that there was no guarantee that under the new setup the same number of staff would be required. He admitted that there might well be changes in the status and functions of the staff that would be required.
I feel that the Minister should look more closely at the question of the possibility of staff redundancy, particularly in view of the fact that we are in practice now dealing with the whole question of unemployment. In my view, the functions and degree of activity of the new corporations, in comparison with the old trading companies, will mean a reduction of staff. There is no provision whatsoever in this Measure to face up to the responsibility of dealing with those redundancies.
The question of compensation has now become acceptable, in a large measure, throughout the whole of industry. The principle of compensation for loss of jobs, both of staff personnel and workpeople, is one that has received a great deal of 1090 attention in the last few years. I should have thought that the Minister would have faced up to this because even the Government accept the principle of compensation for unemployment and because it will be recalled that one of the conditions for the assistance given to the cotton industry was that the industry would be prepared to negotiate with the trade unions adequate compensation for redundant staff as a result of the reorganisation.
Then there is the question of the changing of the top management of the old companies, some of whom will not he required to do their present jobs under the new corporations. I think that the Minister might well have a closer look at the possibility of dealing with the position of redundant personnel of the old companies and compensation for loss of jobs for those people who will no longer be required in top management under the new corporations.
§ Mr. Graham Page (Crosby)
I rise only to thank the Parliamentary Secretary and his right hon. Friend for now including in the Bill at least part of the Amendment which I tabled in Committee. I am indeed grateful for his dealing with the pensions side of this problem. With regard to the remarks of the hon. Gentleman the Member for Gloucestershire, West (Mr. Loughlin) on the other part of the problem which he and I discussed in Committee, I think it may be that the Bill already covers it. If the management corporations take on the liabilities of the existing undertakings, then they surely take on the liability to compensate if redundancy occurs.
§ Mr. Loughlin
I thank the hon. Member for giving way. As I understand it, there is no provision for the payment of compensation under this Measure to staffs who may be redundant. Perhaps the Minister will either confirm or reject that point of view.
§ Mr. Page
I think that from the fact that there is doubt between the hon. Gentleman and myself calls for some explanation from my hon. Friend, and if then there is still a doubt in the Bill I should like to see it remedied. There may yet be time to do so in another place. I thank my hon. Friend very much for the inclusion of the Amendment concerning pensions.
§ Mr. J. Rodgers
In answer to the hon. Gentleman the Member for Gloucestershire, West (Mr. Loughlin) and my hon. Friend the Member for Crosby (Mr. Page), they are quite right in thinking that every employee of a company becomes on the appointed day an employee under the same conditions of service of the appropriate corporation and his employment thereafter will be governed by contract of service as it is now. I think that the point which has been made by the hon. Member for Gloucestershire, West will be adequately taken care of.
§ Mr. Loughlin
Is it not a fact that the sum total of the contract of service merely necessitates the requisite notice of termination of employment if the person concerned is redundant? Provided that the requisite notice of termination of employment is given, then the contract under the provisions of this Bill is carried out and there is no compensation or provision for compensation of any kind for those people who are moved from job to job or who become redundant.
§ Mr. Rodgers
Whatever liabilities the corporations have towards their servants or former servants will be taken over in toto by the new corporations.
§ Mr. John McCann (Rochdale)
Surely this is a point worth labouring. The difficulty in the textile industry was that the question of compensation was not written into the agreement and it was only by virtue of the fact that the firms themselves were prepared to pay that those concerned actually got it. Can the Minister say whether people at present employed are liable for compensation in the event of redundancy, because if not, there is no point in taking over the liabilities if those liabilities to the workmen do not exist.
§ Mr. J. Rodgers
I have no detailed knowledge of the actual contracts of service of the employees of the various companies. All the contractual obligations to the companies are transferred to the corporations and each employee of the companies will become, on the appointed day, an employee of the corporations, and all the same obligations of the companies will be transferred to the corporations.
§ Mr. A. C. Manuel (Central Ayrshire)
I wonder whether the Parliamentary Secretary, as he has no intimate knowledge of the details of the contract between the present employers and employees, will again look at this matter if what my hon. Friend the Member for Gloucestershire, West (Mr. Loughlin) has said is correct, that the new Corporation when created can escape any obligation to pay compensation to servants in their employment by reason of a previous commitment which gave them the right to sever the employment provided that they gave the requisite notice. That requisite notice would not be the means to use in a takeover such as this. if we can have some undertaking tonight that the Government will look at it in order that some protective provision will be put in if things are like that, I am certain the House will be very pleased.
§ 8.0 p.m.
§ Mr. J. Rodgers
I honestly do not think there is any need to look into this any further as has been suggested by the hon. Gentleman the Member for Central Ayrshire (Mr. Manuel), because we are satisfied that all the liabilities of the companies towards their employees are being transferred to the Management Corporations under Clause 13 (2), and all the liabilities of the companies now and the contractual rights of the staff are being preserved in toto.
§ Amendment agreed to.
Further Amendment made: In page 10, line 3, at end insert:
(6) The following provisions shall have effect (without prejudice to the generality of subsection (2) of this section) as respects any pension, superannuation or life-assurance scheme or fund in force at the commencement of this Act for the benefit of persons in the employment or former employment of a company to which this section applies:—