§ Order for Second Reading read.
§ 3.50 p.m.
§ The Minister of Labour (Mr. Edward Heath)
I beg to move, That the Bill be now read a Second time.
This is a small and a simple, but not an unimportant, Measure. It affects all those manual workers who are protected by the Truck Acts. It will enable those who wish it to be paid, by agreement with their employer, in ways that are now widely used by salary earners and which, in an increasingly prosperous industrial society, may more and more be found convenient by other workers. It does this by making a change in the Truck Acts, which have long been valued as a protection for manual workers, and it does so in a manner which, I am sure, is not in any way detrimental to the workers whom the Truck Acts seek to protect.
I should like to emphasise at once that there is nothing in the Bill that compels anyone to take advantage of its provisions. It permits workers to be paid in certain specified additional ways with the agreement of the employer. It allows no one to compel workers to use these methods The Bill is in every way permissive and in no way compulsory.
As the House knows, the Truck Acts were meant to secure that the wages of workmen were fully and honestly paid. That principle is fully upheld in the Bill. Parliament itself has long concerned itself with this matter. A Statute of 1464 sought to secure that workers in the cloth trade should get "… lawful" money for all their lawful wages. Other Acts followed that, becoming more and more complex.
It may well be that in the seventeenth and eighteenth centuries the proper payment of wages in goods was not entirely a disadvantage for workers. In times of difficulty in communications it may sometimes have been beneficial for them, provided that it was properly supervised. Nor, I think, is it always realised that in those centuries there were, on occasions, acute shortages of coin and currency, and very often manufacturers themselves had to pay their suppliers in finished 383 goods. We read of times when long journey were made, and much time was spent riding about the country in search of cash with which to pay wages. In the North and Western parts of England the dearth of coin was often acute.
Those were the circumstances in which payment in commodities and in food sometimes took place. What the Truck Acts did was to endeavour to prevent these practices being abused. The most flagrant of the abuses that the Acts sought to remedy are, I think, well-known. Workers were forced to take goods which were supplied to them by their masters at whatever price the latter fixed and however useless the goods were; or they had to do without part of their wages.
Sometimes the workman was paid with what was called a "portion of that which he has helped to produce", but more often he was paid in commodities. Wages were sometimes given in money, but with an express or tacit understanding that the workman should go to his employer's shop for the goods he wanted. Very often a shop ticket was given instead of money. The shop might belong to the employer, or to a contractor, or to someone who paid to run it for them. Sometimes the keeper of the "tommy" shop, as it was called, would supply cash against tickets—at a discount of ld. in the shilling.
If I may delay the House for a moment, an observer on Tyneside gives a picture in the latter part of the eighteenth century of a "tommy" shop at a pit. He says:The Overseer, who, by the by, is seldom distinguished for the amiableness of his character, constantly keeps a shop contiguous to the Pit where he lays in every necessary both for the belly and the back, and obliges the poor men to buy whatever they want from him, stopping it out of their wages at a stipulated sum a week till the whole is discharged.Miners might sometimes, in this way, be induced to pay 12s. for 6s. worth of flour.
It is no wonder, perhaps, that there were complaints of the kind made by the character at the "Rising Sun", in Disraeli's "Sybil", who said:The fact is, we are tommied to death,384 or asked the question:What is wages? I say 'tayn't sugar, 'tayn't tea, 'tayn't bacon, I don't think 'tis candles; but of this I be sure, 'tayn't waistcoats.For the speaker was telling how one Jugginsapplied for his balance after his tommy-book was paid up",and was obliged totake two waistcoats.The need for the Truck Acts is, therefore, laid at the door of the bad employer. But one must also remember that the good employer often found difficulty in paying in cash in those centuries because of the shortage of currency at that time.
Truck legislation today is mainly founded on the Act of 1831. At that date, all the miscellaneous Acts then in force which sought to impose restrictions on the truck system in various trades were repealed. The new Act was still not a general one, but it aimed at protecting the workers in all the trades in which experience had shown the truck system to be most prevalent. They included iron and steel, the making of various things from iron and steel, coal mining, quarrying, metalware, weaving, spinning, and the manufacture of pottery and glass.
That Act has since been amended and extended by a number of other enactments and the Truck Acts, as we know them today are, indeed, intricate. They include, as well as general provisions that workmen's wages must be paid in cash and not in kind, others aimed at defining what is meant by cash in this context; at ensuring that contracts between the employers and workers do not contain anything contrary to the general intention of the Acts; at controlling the supply of goods by employers to workers on credit; and at regulating deductions. Moreover, the scope of the Acts is somewhat obscure, and in some ways it is anomalous, for since 1887 it has rested on the definition of "workman" in the Employers and Workmen Act of 1875, which was drawn up in industrial and social conditions very different from those of today.
Broadly speaking, the position now is that it is illegal for an employer to 385 pay the wages of a manual worker otherwise than in cash. It is true that not all manual workers are protected by the Truck Acts, but all those who are so protected are, 1 think, manual workers. If a worker in respect of whom this prohibition operates is, in fact, paid his wages otherwise than in cash, he may sue his employer for non-payment of those wages just as he could if, in fact, he had received nothing at all.
This is a very powerful safeguard which is not, in principle, set aside by the Bill. The Bill says no more than that, subject to certain fresh safeguards, not only notes and coins bat certain other well-established ways of transferring money safely from one person to another shall be treated as cash in the payment of wages.
An interesting point is that the effect of the law as it stands at the moment goes much further than was the intention of the authors of the 1831 Act in one very important respect. The Act said, in general, that wages had to be paid in current coin of the realm, but it provided for payment, with the worker's free consent, by bearer cheque drawn on a bank which was not more than 15 miles from the place of payment and which was licensed to issue notes. At that time, a considerable number of banks were so licensed.
That means that when the original Truck Act was passed an employer could, for example, legally pay a worker in Croydon with a cheque drawn on a bank in London. He cannot do so now, not because Parliament decided at some time in the intervening period that this kind of payment was being abused and ought to be stopped, but because the time came when no bank in England and Wales, other than the Bank of England, was licensed to issue notes. As a result, the provision of the Truck Act allowing payment by cheque ceased to have any practical effect. In Scotland, the position is rather different. There are still banks in Scotland licensed to issue notes, and payment by cheque may still be made within 15 miles of them.
As the House will recall, there have been several Private Members' Bills before the House in recent years which have sought to legalise the payment of wages other than in cash. My hon. Friend the Member for Crosby (Mr. 386 Page), whom I am glad to see in his place, introduced his Cheques Bill in the House in November, 1956. This Bill was primarily designed to amend the law about the endorsement of cheques, but it also included a Clause to enable workers' wages to be paid by cheque, subject to the consent of the worker concerned.
In deciding what their attitude should be towards this proposal, the Government felt that they should take account of the views of those engaged in industry. In January, 1957, my predecessor consulted the National Joint Advisory Committee, a body composed of employers' representatives and representatives of the trades unions and the nationalised industries, over which the Minister of Labour presides.
A second attempt to deal with the payment of wages was made by my hon. Friend in the Bill which he introduced into the House in January, 1958. The provision about payment by cheque did not reappear, but the Bill included provisions to the effect that employers could, with the consent of the workers, make payments into banking accounts direct, and that in the case of absence, in certain instances, wages could be paid by money order or postal order.
In the course of the Second Reading debate on this Bill on 20th June, 1958, the right hon. Member for Blyth (Mr. Robens), asked that a Bill which affected this principle should receive further consideration by the employers' organisations, the trade unions and the Ministry of Labour. As I think the right hon. Gentleman will recall, the then Parliamentary Secretary undertook to consider this sort of approach, and on that undertaking my hon. Friend withdrew his Bill.
My predecessor then asked the National Joint Advisory Council, in October, 1958, to examine afresh the cash principle in the payment of wages, particularly with reference to the payment of wages through banking channels. The Council agreed that there should be a further examination, in particular, to see whether any aspects of the existing truck legislation required modification; that is, the whole of the truck legislation. It asked its subcommittee, the Joint Consultative Committee to look into the question and report upon it. In November, 1958, a 387 further Private Member's Bill was presented, this time by the former Member for Lanark, Mr. Patrick Maitland, but on this occasion a quorum was lacking.
The National Joint Advisory Council concluded its inquiries in April of last year. Their conclusions were in two parts. With regard to the general question of the Truck Acts, the Council came to the conclusion that although the Acts contained valuable safeguards for the workers which ought not to be abandoned, they might no longer be beneficial in every respect; and, indeed, in certain cases in modern conditions might prevent employers from doing things which would be to the workers' advantage. It was agreed in the Council that the law was extremely complex and that there were many anomalies. They thought that a full investigation would be needed to establish exactly what ought to be done.
The Council endorsed the recommendation of the Joint Consultative Committee, in particular that a small independent committee should be set up to review the whole question and put forward suggestions for bringing the provisions of the Truck Acts more into line with present-day developments. This was followed by the appointment on 30th July, 1959, of a Committee under Mr. David Karmel, Q.C., whose terms of reference the House might recall. They were:To consider in the light of present day conditions the operation of the Truck Acts, 1831–1940, and related legislation, and to make recommendations.This Committee is now taking evidence and considering the whole of the Truck Acts.
On the specific question of the payment of wages through banking channels or by postal order or money order, the Council found that it was possible to go further. The Council appreciated that any sudden change-over on a large scale from the normal payment of wages in cash to these other means would be difficult and expensive, and would involve awkward problems both for banks and employers, as well as for the employees. On the other hand, it recognised that social changes were bringing with them a wider use of banking facilities, and there appeared to be no reason why the worker who wanted to use such facilities should he restricted from doing so by an archaic 388 legal prohibition of payment of wages through a bank. So the National Joint Advisory Council agreed to accept our proposals for amending the law.
It would have been possible to leave all the matters dealt with in this Bill to be looked into by Mr. David Karmel's Committee, and that point has been put in some leading articles in the Press. It would have been possible, but it was not, in fact, necessary. The National Joint Advisory Council recognised that to look into all the complexities of the Truck Acts would take some time. The Council thought that the general structure ought not to be tampered with until it had been studied by an independent committee. The Council also agreed that the more limited question of the way in which wages were to be paid—whether directly in cash or by some way in which cash was made available to the worker—could be treated separately.
This leaves a sufficiently wide field for the Karmel Committee—such questions as the scope of the Truck Acts, deductions from wages and the whole working of those Acts today and their appropriateness to present-day conditions. There was no point in continuing any longer prohibitions which were generally agreed to serve no useful purpose, so we have gone ahead with this Bill.
The proposals agreed to by the National Joint Advisory Council are substantially those incorporated in the Bill. There are a number of refinements of a more or less technical character which have been made while the Bill was being drafted, but the more important ones have been undertaken as a result of the consultations with those concerned.
I should like, here, to pay tribute to the constructive help given us by the British Employers' Confederation, the Trades Union Congress, the nationalised industries, the banks and members of the retail and licensed trades. I should also like to take this opportunity of thanking my hon. Friend the Member for Crosby for the persistence which he has shown in bringing this matter before the House; and also to pay tribute to my predecessor, the present Colonial Secretary, for the preparations he made for the Bill; and to the members of the N.J.A.C. for their interest and co-operation throughout these discussions on all sides, and for the assistance which they 389 have given us. [Interruption.] When people have been co-operating in the preparation of a Bill, I think that we might acknowledge the work they have done.
The outline of the Bill is simple. As I have explained, where an employer now pays a worker within the scope of these Acts otherwise than in cash, he may be sued as if he had not paid the wages at all. There may be a reasonable doubt about the application of the Trunk Acts in particular cases, but, in general, employers have been prevented from paying wages otherwise than in cash. The Bill does not tamper with that. It says that if wages are paid in certain ways and subject to certain safeguards which are specified, there shall be no contravention of those Acts. If payment is made in these way s and with these safeguards, it will be taken not to contravene the Acts.
Wages which are not paid in cash, nor in one of these ways will still be regarded as illegally paid, and workers so paid will have the full protection of the Acts. The Bill does not attempt to solve any of the problems of the application of the Acts which, from time to time, have caused difficulty. The general structure of the Acts, as I have already said, is a matter for subsequent legislation if it should be agreed upon.
The basis of the Bill is that the worker will continue to receive his wages in cash unless he makes a request for all or part of them to be paid in another form. That is Clause 1 of the Bill. The request may be for payment direct into a banking account, by postal order, by money order or by cheque. The worker has to make his request in writing. He must specify the bank and the branch, and the account into which the wages are to be paid, which may be a joint account in his own and other persons' names. The worker must make his request in writing. Payment by the new method will become legal if the employer agrees to the request, which he may do simply by making payment in the way specified. It was generally agreed that it was an unnecessary part of the process that the employer should write back and say that he would accept the request.
Under Clause 2 the employer has to give the worker a statement showing the gross wages, the amount of deductions, 390 and the net amount payable. The worker must receive this statement on or before the time when the payment is made.
By Clause 3, if either the employer or the worker wants to cancel an arrangement for payment otherwise than by cash, then whoever is taking the initiative, must give 14 days' notice in writing. This is necessary so that the employee will know in advance about any change in the method of payment, and so that the employer will have time to alter the system. Payment by crediting a bank account, in particular, takes a certain amount of time to arrange.
In considering the Bill, we wanted to make certain that the worker who receives his wages in one of the ways proposed receives the full amount and has nothing snipped off for poundage on postal or money orders or for Stamp Duty on cheques. Accordingly, we have provided in Clause 2 (3) that no deduction may be made from the gross amount of wages by reason of the fact that payment is being made in one of the ways specified in the Bill. The subsection does not deal with bank charges, a point which has been raised from time to time. The matter of bank charges is really one which the employee must agree about with his bank if he decides to open a bank account, just as any holder of a bank account has to do.
Clause 4 contains a special provision for the worker who is away on pay day. What we have in mind here is the occasion on which a worker is sick, or away on duties connected with his work, with the result that he is kept away from the usual place of payment. If he has already asked that his wages should normally be paid in one of the ways specified in the Bill, no problem arises at all. If, on the other hand, he has not made any arrangement such as those set out in the Bill, he has, normally, to be paid in cash, and both employer and employee may find themselves in a difficulty. There may, for instance, be delay in getting to a sick worker the wages due to him.
What is proposed in Clauses 4 (2, a) and 4 (2, b) is that, where a worker is away on duty or sick, it shall be legal to pay him by postal order or money order all or any part of his wages not covered by an arrangement under the general provisions of the Bill. Under the 391 general provisions of the Bill, of course, it is possible not only to have the whole of one's wages paid in one of these ways but to have part of them so paid, the rest being paid in cash. In the case of payment under Clause 4, there are to be no requirements about a written request from the worker or the agreement of the employer. In the nature of the case, it might not be possible for such a request to be made.
The employer must have good reason to believe that the worker is away on duty, has been taken sick or had an accident. The worker must be given a statement of wages and deductions in the same way as under the general provisions of the Bill. Apart from that, there are no other formalities. It will be agreed generally that this Clause will be useful in setting aside the present prohibition on payment of wages by postal or money order in cases where a worker is away either on duty or ill.
Perhaps I should say a word now about the savings banks in relation to the Bill. I speak here after having had consultations with my right hon. Friends the Chancellor of the Exchequer and the Postmaster-General. Clause 7 brings savings banks as they are defined in the Clause within the scope of the Bill. Many savings banks accept wages by direct credit where the salary is credited monthly. Their procedures and organisation may make it difficult for them to offer any convenient and economical service to the public for weekly wage credits. We cannot assume, therefore, that, even if savings banks are legally empowered to do so, all of them will be able or willing to take part in the scheme after the Bill becomes an Act. It will be up to the individual banks to say for themselves whether they are ready to accept this business and, if so, on what terms. We did not feel that there was any reason of principle why they should be excluded from the Bill, provided that they were genuine savings banks in the common understanding and use of that term, and as defined in Clause 7.
The Post Office Savings Bank, however, is not covered by the Clause and it is in a rather special position. It would be necessary to amend the Post Office Savings Bank Act before any practical scheme could be put into force. If it is 392 decided that that should be done, that will itself provide an opportunity for an Amendment to be made to bring the Post Office Savings Bank into the list of savings banks covered by Clause 7. My right hon. Friend the Postmaster-General has still to decide whether to promote this legislation for the Post Office. The Post Office Savings Bank does not lend itself readily to the economical conduct of this sort of business. Moreover, as the Postmaster-General has already told the House, he wants to consider this matter in the context of the general examination of Post Office facilities which has been prompted by the Radcliffe Report, and this will still take a little time.
I come now to the timing of the Bill. It will come into force in three stages. The first stage will be one month after it becomes an Act. From this date, the payment of wages by postal order or money order will be allowed when a worker is away from work on duty or sick, in the circumstances provided for in Clause 4. Clause 4 will come into effect one month after the Bill becomes an Act. Cases of this kind will, I think, be relatively few and there seems to be no reason for delay in bringing these provisions into force.
The second stage will be six months after the Act is passed. On that date, the main provisions will come into force. It will then be legal to pay wages into a bank account, or by postal order, or money order provided that the safeguards are observed. We feel that this interval of six months will give employers, workers and banks time to work out any arrangements they may wish to make.
The third stage, the payment of wages by cheque, will be brought in by Order later, on an appointed day to be fixed by the Minister. We have adopted this procedure because of the apprehension which has been expressed by some members of the retail trade about the demands which might be made on them if workers are paid by cheque. The suggestion is that shopkeepers will be put in some difficulty by workers trying to cash cheques; and that shopkeepers could comply with such a request on any great scale only if they kept large amounts of cash on their premises. They could refuse, it is suggested, only at 393 the risk of displeasing some of their customers. It is even felt by some retailers that the need to carry a large cash balance would involve them in considerably increased risks of robbery and theft.
While I have no doubt at all about the genuineness of the fears expressed by the retailers' representatives on this subject on more than one occasion when they have been consulted about it, I do not really believe that, in practice, things are likely to be as serious as they fear. It is difficult to see why very many workers should wish to be paid by cheque only to have to go to some trouble and inconvenience to have it cashed, when they could receive the cash in the first instance.
I recognise, however, that the fears of the retailers are founded on a genuine doubt as to the extent to which the facilities will be used. Such doubts must exist until we have had more experience of the payment of wages other than in cash and by the other methods described in the Bill. It is for this reason that I propose in the Bill that payment of wages by cheque should not be legalised until a date which I appoint by Order. This will give everybody concerned with the payment of wages an opportunity of judging the extent of the problem and, once the Bill is passed, of trying to find out what is the probability of the use of this method. The whole purpose of dealing with this matter by power to make an Order is to allow it to be considered in the light of our general experience of the working of the Bill.
The question may be asked as to what extent the other provisions will be used. This is very difficult to say, but the limited amount of information available is, I think, interesting, although it is difficult to obtain explicit figures. It is said that in the United States of America, after two and a half years of facilities being provided by the banks, more than 40 per cent. of wage earners were using bank facilities.
A statement was made recently about one of the joint stock banks in this country which made an analysis of its new accounts. In October, 1958, 16 per cent. of the new accounts of customers were held by wage earners. This compared with 10 per cent. in May, 1954, an increase of 6 per cent. over four years.
394 Some interesting figures have also been published by Imperial Chemical Industries during the last few days. As an experiment, this organisation has been adopting the method of payment direct into employees' bank accounts for wage earners who are eligible. Having started the scheme in May, 1958, the figures show that by December, 1959, about 20 months later, 26.3 per cent. of all adult male employees were receiving their wages by payment direct into their own bank account. I think that there are two other interesting things about these figures.
First, this firm was making payments into 70 or more branches within the area of its work, so that the payments were very widely spread. Secondly, only 30 employees have reverted to payment in cash since this scheme started, chiefly because of the limited facilities for cashing cheques in some villages. That indicates where the facilities will be used and where it will he found that because of local difficulties employees do not wish to take advantage of them.
I should like to emphasise a further point. The basic principle of the Bill is that no worker shall take his wages other than in cash unless he wants to do so. I know that this is a point of the greatest importance to the Trades Union Congress and all who work in industry. The point of having the right to be paid in cash is also of great importance to the Government and to those in the retail trade. During our discussions in the National Joint Advisory Council, the representatives of the Trades Union Congress put very great stress on this point. Therefore, by Clause 6 (7) we have included a provision which makes it clear that no one can be compelled to make a request for payment in any of the ways authorised by the Bill. It also makes it clear that no one can be stopped from changing back to payment by cash if he makes a request to do so.
Clause 6 also makes clear that it will not be open to an employer to make it a term of a worker's contract that he should he paid otherwise than in cash. Because of subsection (7) of Clause 6 it cannot be made a condition of employment that a worker should accept payment in the way an employer wishes except with the worker's own agreement, and the normal way is still by cash.
395 That is all I want to say about the Bill at this stage. I have said something about the historical background which extends way back to social conditions and conditions of communication very different from those of today. I have shown how this measure has grown with the general assent of both sides of industry because of a widespread feeling that the law is, to some extent, out of date. I think that the House will probably agree, when it considers the Bill, that it is unnecessary in the second half of the twentieth century to tell a manual worker protected by the Truck Acts that simply because he is a manual worker he cannot take his wages through a bank by cheque, however convenient he may find it to do so and however much he may wish to use that method. But that is the law at the moment, and that is what we propose to change.
In making the change, we are not, in well-known words, dragging anyone screaming into the second half of the twentieth century, or, indeed, trying to drag anyone anywhere. We are simply saying, "The door which has been pushed to, not because the authors of the original Acts intended it, but merely because of historical process, is now being opened again, and if you want to go through it do so". There are social changes afoot and the manual worker today is enjoying greater prosperity than ever before. I believe that in time many may want to make use of these facilities. But we are not pushing anyone, and we are seeing to it in the Bill that no one is pushed.
§ 4.26 p.m.
§ Mr. Alfred Robens (Blyth)
I should like to begin by congratulating the Minister on the clarity with which he has outlined the details of the Bill, because I think that this is the first Bill for which he has Ministerial responsibility.
We were very glad to have the historical notes of the social problems which led to the Truck Acts and the rather more up-to-date information about what took place in the National Joint Advisory Council and the Joint Consultative Committee and the advice which the right hon. Gentleman received from that body.
I am bound to say, however, that I do not understand why the House should 396 be troubled with this Bill at this time. There is a whole lot of very vital legislation which we need to consider, and I should have thought that it would have been sensible to await the report of the Karmel Committee and its recommendations to amend the Truck Acts. I understand—perhaps the Minister will correct me if I am wrong—that the report and recommendations will be available this summer.
Those recommendations and amended Truck Acts would take us a long way towards dealing with the problem, and also, if the Truck Acts are amended, would safeguard a larger number of workers instead of having to amend this Bill which, if it becomes law, we shall have to do. We could then have a Bill to deal with the people covered by any amendment of the Truck Acts which this House decides upon, having considered any recommendations of the Karmel Committee, in enlarging the safeguards under the Truck Acts to certain other workers.
I would have thought therefore that we might sensibly have left the Bill until we had an opportunity of considering the Karmel Committee's report so that we could deal with the matter as an entity rather than take up the time of the House on something which, I understood from the Minister, is solely for the benefit of the worker. [Interruption.] I am saying what the Minister said. He assured us that this Bill is solely for the benefit of the worker. He said that nothing can happen unless the worker says to his employer, "May I have my wages paid?"—and then he may recite any one of the four methods in the Bill.
This Bill is not to help the employer or the banker. It is not introduced for any of the reasons which we were given in our debates on Private Members' Bills. It is to help the worker, but the strange thing is that none of the workers' organisations wants it. They have never asked for it.
I followed with interest what the Minister said about the work of the Joint Advisory Council and the Joint Consultative Committee. I was not present, of course, at the meetings, but, from what I hear, it is not my view that the T.U.C. said, "We want a cheques Bill to deal with this problem." I understand that the T.U.C. representatives were met at the Joint Advisory Council by the former 397 Minister of Labour, saying that he had made up his mind to have a Bill providing for the payment of wages by cheque. The reason why the former Minister of Labour had made up his mind to have a cheques Bill was because of the pressure from back benchers opposite who, on a number of occasions, had attempted to get Private Members' Bills through the House, but which we on this side resisted time and time again, and successfully resisted, because none of them ever passed into law. It is not that the workers have asked for this Bill.
§ Mr. Robens
I shall come to their wives presently. I do not exclude the possibility of discussing workers' wives here or anywhere else. I will come to that with the greatest of pleasure, but it is not a fact that the workers have asked for the Bill.
I remind the right hon. Gentleman that under the emergency wartime legislation, county councils were empowered to pay wages by cheque. The unions that catered for county councils' workers, notably the National Union of Public Employees, were under such pressure from their members who were employed by county councils, who were having their wages paid by cheque, that they asked the county councils to stop paying their workers' wages by cheque and to pay them in cash as before. County councils refused. The late Lord Jowitt was approached to take the case for the union and it went before the High Court, who decided that the action of the county councils was a contravention of the Truck Acts. The county councils were compelled by High Court decision to stop paying wages by cheque. That decision came about because the workers who were being paid by cheque did not like it and asked their union to act in their defence.
§ Mr. Robens
That is exactly the point I am trying to make. The county 398 councils having been given the power to pay wages by cheque, workers at one stage did not like it. They asked county councils to stop paying wages by cheque. The county councils refused and the High Court had to tell the county councils that they were doing something illegal. My reason for mentioning this is to show, by a case in point that cannot be denied, that workers have not asked for the Bill.
The real reason for the Bill is, as explained in this House time and time again, to meet the convenience of employers. We had some wonderful illustrations in the House not long ago of the enormous economies that could be made if only employers were permitted to pay in this way. The security question also was raised. Those were the reasons that were advanced, not the convenience of the worker. It would have been more honest to have made the case that that was the reason for the Bill.
§ Mr. Heath
If the right hon. Gentleman is saying that I am not honest in making that point, I have not made it because that is not the reason why I have introduced the Bill. Those may be reasons which some of my hon. Friends have put forward and they may or may not be valid. From the viewpoint of the Bill being an advantage to an employer or a bank, there is a careful balance of advantage and I would not like to say where it lies.
§ Mr. Robens
I am not accusing the Minister of being dishonest. All he is doing is taking over legislation prepared by his predecessor. He has no option but to take the brief of his predecessor and deal with it as best he can. I do not talk of dishonesty in the sense that the right hon. Gentleman seemed, rather touchingly, to take it, but it would have been far more honest for debate to bring out those other issues. They are on record and they are the real reasons. No application of any kind has been made by the workers for payment by cheque. The right hon. Gentleman cannot produce one bit of evidence to that effect. There is, however, plenty of evidence that the requirement to pay wages by cheque was brought about by employers.
§ Mr. R. Gresham Cooke (Twickenham) rose—399
§ Mr. Robens
I shall not give way, because I do not want to take up too much time. We shall, no doubt, come to the same points. The hon. Member will be able to make his own speech if he catches Mr. Speaker's eye.
I would like to make the two points which I have made before, because I wish the House to know exactly where we stand. First, we entirely agree that the Truck Acts should be looked at and amended in the light of modern conditions. Secondly, it is right that the worker should have the freedom to have his wages paid by cheque if he so desires. I accept those two things right away. I want to be certain, however, and I think that all my hon. Friends want to be certain, that it is absolute freedom on the part of the worker that is being exercised and that in no way can pressure be brought upon him to sign the form requesting that his wages be paid by cheque or by any one of the arrangements outlined in the Bill.
I believe that the bulk of the employers would operate the Bill fairly and honestly, but the House has to legislate for all. Generally, when legislating to deal with crime, we deal with a minority of the population and not the majority. In dealing with protective legislation, we are always dealing with a minority and not the majority. Our legislation in these spheres is concerned with those who are determined to get behind the law and not face up to their responsibilities as the majority of the population, both employers and workers, face them.
Therefore, I am concerned in the Bill not so much with the enlightened employers and the workers whose interests are adequately and properly safeguarded by their trade unions. There are 23½ million people gainfully employed and a large number of them are workers who will be covered by the Bill. I am concerned that those who do not have the protection of the trade union movement, or who may be missed, should not have pressure brought upon them to sign a request for their wages to be paid by cheque. To this aspect, we must give a good deal of extra consideration in Committee, because it seems to me that the Bill is weak in many respects in that regard.
For example, I will take up what the Minister said about Clause 4. I am 400 absolutely against the right of an employer, without any request at all, to send a man's money by cheque, postal order or money order when he is away sick or away on the firm's business. I am completely against an employer having the right to do that without request from the worker. [An HON. MEMBER: "Why?"] I will explain.
A man's income is his personal business. If that were not so, Income Tax accounts would be open for everybody to see. No employer has the right to send a postal order or a money order with a statement of how a man's earnings have been arrived at without the worker himself expressly asking, "If I am sick at any time in the future or away on business on behalf of the firm, please send it to me."
To revert to the point about workers' wives, this is a peculiarly difficult social problem, for there are many husbands and wives whose private domestic relationship is of such a character that details of the wages that the man earns are kept entirely, in the interests of their domestic life, in the knowledge only of the husband. It is no part of the business of the House either to investigate the reasons why that should be so, or to say that it should not be so, but to recognise that it is so and that a man's earnings are for his personal information and knowledge only, unless he himself desires to pass on that knowledge elsewhere. Therefore, I say definitely that no wages or earnings of any kind should be so sent unless the worker asks for it to be done for him.
§ Mr. G. Wilson
If that argument were carried to its logical conclusion—it assumes that somebody will open an envelope which is addressed to a worker—it should not be limited only to wages. All sorts of personal communications are sent by post.
§ Mr. Robens
I do not know about the hon. Member, but in my experience it is not unknown for my wife to open some of my letters. It is also possible for a letter to be misdirected and opened by somebody who has no relationship with the man.
These points are not arguments to say that we should not have the Bill. They are indications of what we shall expect, 401 when we come to the Committee stage, to talk about in greater detail and we hope that we shall have the support of the right hon. Gentleman and his staff in helping us to meet this kind of problem. I picked up the point about Clause 4 because it was the one point that the Minister stressed. He very properly and very kindly showed us that in this connection there will be no request on the part of the worker, and we are stating what our view is and what we propose to do in Committee.
I do not think that it is necessary, now that we have the Bill before us, to argue further the merits or demerits of payments in the way that it indicates. Our best line now is to look at the Bill and make sure that it is tight and complete, so that a man's income is retained as a personal matter for himself.
There are one or two other matters to which we shall require to give attention. I have spoken about the possibility of pressure by some employers upon work-people. We have to look at the position of people who live in tied cottages. I hope that agriculturists and others will not think that I am at this moment condemning all farmers who have tied cottages and workpeople living in them—I am not.
All I am saying is that if it were a convenience for some people who have workers in tied cottages to pay by cheque, it would be very easy for them to put pressure upon the worker living in a tied cottage to have his wages paid by cheque. We should look at that matter and consider whether or not it requires tightening to make sure that it is not the employer who instigates the request for payment by cheque.
I hope that at some stage during the passage of the Bill we shall be able to find words which would make it an offence for an employer to request a worker to have his wages paid in the ways indicated in the Bill. I do not know exactly what words we would use, but I am clear myself that we must provide suitable safeguards to stop any possibility of pressure.
It is certain that it would be a disadvantage to employers who wanted to pay wages by cheque or banking account if they were able to get only 90 per cent. of their workers to agree and the other 10 per cent. stayed out, as they 402 would have the process of sorting out those who wanted to be paid by cash and this would not lend itself to machine accounting, which is really at the back of the Bill. I feel, therefore, that we ought not to leave any loophole which would enable an employer to pressurise that 10 per cent.
I think that what we might try to do is this. Where there is a factory or place of employment where wages and conditions are laid down by agreement between trade unions representing the workers and employers, it might well be that where the factory employer proposes to put this into operation there should be proper consultations through the trade unions and a line of communication made through the trade unions to the workers so that the workers are given the best advice from the trade unions as to their safeguards.
§ Mr. A. E. Hunter (Feltham)
Would my hon. Friend help me on this point? What would be the position of a small firm which issued cheques to its employees and the cheques could not be met?
§ Mr. Robens
It would be hard luck on the man who got the cheque. I have no doubt that that, again, is something which we ought to look into. I must say that that point had escaped my notice, because I did not think that "bouncing" cheques were common these days. Nevertheless, it is one of the safeguards which will have to be looked at.
I believe that I have said sufficient to show that while I am in sympathy with the principles enumerated in the Bill there is need to tighten up the Clauses very considerably. I would like to ask the right hon. Gentleman to spend a moment or two in thinking about the recipient of the money order, postal order, or cheque. He will be well aware that if the banks are to be one of the methods through which cheques are to be changed, there ought to be consultation between the chairmen of the banks and the National Union of Bank Employees.
This is a sensitive point because bank chairmen, with the exception of one or two, have always refused to recognise that there is such a thing as the National Union of Bank Employees. Very often in their addresses to the shareholders, when 403 they lecture the country, politicians and industrialists on how to conduct their affairs, they say a good deal about industrial disputes, but they are the last people themselves to face up to what all enlightened employers are prepared to face up today, and that is the recognition of a bona fide trade union in relation to their workers. They still continue to regard a union as a company union, which, one would have thought, had passed out of people's minds in these days.
I believe that there ought to be pressure by the right hon. Gentleman upon the bank chairmen to face the fact that there is a necessity for consultation with the National Union of Bank Employees about the work and arrangements which will require to be made should advantage be taken of the Bill, if it becomes law, on an extensive scale in relation to the cashing of cheques. I am fortified On this point, because I picked up the script of a broadcast made in July last year when the matter was of public interest and many people were discussing the question of paying wages by cheque.
Among the speakers was Mr. Thornton, who is well known to everyone here as the senior general manager of Barclays Bank—a man with very long experience in banking and whose views cannot be ignored. He said in the broadcast:You may perhaps be interested if I give you a few figures which I have had worked out by my office. We have a branch in the Midlands with 12 people on the staff. On Thursdays and Fridays three of those 12 people are serving on the counter as cashiers. Now, the customers of that branch have between them 15,500 workpeople and if all those people wanted to draw money from that branch on Thursday and Friday, instead of three cashiers we would need 26. That is the magnitude of the problem if this proposal should come about and the banks are faced with a flood either of new accounts or of weekly withdrawals of cashHe added:. … the banks could be overwhelmed if there were a mad rush to transfer the payment of wages by cash from industry and commerce on to the shoulders of the banks. You could shift the location of this work, but you certainly could not avoid the incidence of the cost, and you could, in fact, make it impossible for the banks to carry it out.It seems to me that we must take some notice of the views of the senior general manager of Barclays Bank.
404 I hope, therefore, that when, during the passage of the Bill, I ask the right hon. Gentleman to try to persuade bank chairmen to consult the National Union of Bank Employees he will realise that he will be doing only what he is always advising other industrialists and trade unions to do. I hope that he will use his influence in that direction.
I should like to know whether arrangements would be made for banks, particularly in remote places, to remain open in the evenings for the cashing of cheques. Workmen will not be able to go to banks to cash cheques in the daytime. It may be said that they need not go to a bank and that they can go to a shop, but if I were a workman living in a little village I should think twice before going to the local grocer to cash my pay cheque. Why should I have to disclose to everybody in the village what I earned every week?
I would prefer to go to one of two places where I would get a personal service of a confidential character. One would be a bank and the other the post office. What arrangements have been made, if any, for post offices to cash cheques? One cannot pay a cheque into the post office and, if one could, one could not draw out more than £3 at a time. But the post office is a place where a man could feel that he would have an impersonal service, at least a little more impersonal than at the grocer's shop. What other facilities are there for cashing a cheque if a man has not a banking account? If a man is on an ordinary average wage he will never open a banking account, because he wants all the cash that the cheque represents. In Coventry, there are 350 public houses and 36 banks and the possibilities are that as the "pubs" will be open and the banks will not, the public house might be the place where the worker could cash his cheque.
It may be argued that if the worker does not want to be involved in all this he need not have his wages paid by cheque. When one considers what the county councils did with their county roadmen I very much suspect that there will be quite a number of employers who will want to put gentle pressure, for their own convenience, on their workers to take wages by cheque. 405 Therefore, I draw attention to some of the problems that will arise as a result.
We must prepare ourselves for a Committee stage of the Bill which will take account of matters similar to those which I have raised and which, no doubt, other hon. Members on both sides of the House will raise in the debate. As for the Bill, the principle that the worker has a right, at his own request, to have his wages paid in one of the manners indicated is one to which we cannot object. It is a freedom and a right which the worker should have, but we must make sure that we write into the Bill every possible safeguard so that when it becomes law it is clear beyond shadow of doubt that it is the worker's own request and that it is quite impossible for an employer to influence the worker to make that request.
§ 4.54 p.m.
§ Commander J. S. Kerans (The Hartlepools)
I beg to claim the indulgence of the House. I should like to make some comments on the working of the Bill as I see it affecting my constituency, which has an estimated working population of over 20,000 in a fairly concentrated industrial area. There are only eight banks in the constituency and I should like to mention what I think would be the consequences of the payment of wages by cheque, money order or postal order.
First, if all workers are to be paid by cheque it is obvious that there will be delays at the bank, and it should be remembered that very often on Saturday mornings there will be, at the same time, people who will be wishing to pay in wages. In many cases, especially in my constituency, people have long distances to go to town where all the banks are concentrated in the shopping area. Many people would not wish to go into town, for various domestic reasons, and the banks certainly would not be to the convenience of the vast number of employees who work on Saturday mornings.
We come back, therefore, to the question of cashing cheques in the local grocer's shop and the public house. There are a large number of public houses in my constituency. To enable these cheques to be cashed, a small businessman would have to draw additional sums of money during the 406 week, and so also would the publican. They would thus lay themselves open to being knocked on the head and robbed, and that is one of the very things which the Bill is designed to prevent. I do not think that these people should be placed in a situation in which they would have large sums of money in their possession and probably quite inadequate safe facilities. They would probably have to purchase safes and that would be an additional expense. Once this system is adopted we might well get a wave of robberies, and that is something which I certainly do not want to see.
There would be a very large number of people who would be handling cheques for the first time. Many of them have never seen one and do not know how to pay it in to a bank or what it means. We might well get a period of considerable chaos and confusion. Many people dislike using the bank and paying bank charges. Many people regard a bank as a place where their money is taken away from them and consider it not to be in their interest to use a bank. I have heard that point of view expressed many times in the course of my career.
A great deal of education is needed to overcome this prejudice among a number of people. I can quote the case of a lady in my constituency who was provided with some personal cheques on the Midland Bank. In a week she filled up some of them for various sums of money, none of which she possessed. She thought that whatever one wrote on a cheque one could draw. She thought she could draw whatever money she desired.
I suggest, also, that we should be likely to have another type of person on the warpath, the man who would say, "All right, I will cash your cheque if you give me 6d. or 1s. in the £." He would soon start a little racket which would lead to abuses and heaven knows what else. I also believe that a great many people would not wish to disclose their wages, which the encashment of a cheque would be bound to do. For example, if the husband were sick the wife would have to go down the road to cash the cheque and, therefore, would be bound to know the amount.
During the course of the election campaign I found that very few wives had ever seen a pay-slip, never mind knowing what amount the husband drew. In some 407 cases where a man draws a "sub" of £5 or £10 the wife thinks that it is some additional payment from the previous week. This is one of the many points which we ought to bear in mind.
As for sending money through the post, I cannot really believe that registered letters are likely to go astray. I say that they would be registered because I am convinced that any firm sending wages through the post must register the envelope, for its own security, if nothing else.
The Bill states that payment can be made by postal order or money order. This means that we might well see a considerable crowding of some sub-post offices and main post offices, especially over the wekend. It is difficult enough to get new sub-post offices, as I know from the area where I live. If payment by money order or postal order is accepted I submit that we have a good case for more sub-post offices to be built. This particularly concerns my constituency, which has a vast rehousing plan and is rapidly building new estates. If we do not have these facilities, payment by postal order or money order will be farcical.
We have heard from the Minister that payment through a bank account is being made by I.C.I. at their Wilton works. That is a step in the right direction and, clearly, its popularity is slowly increasing. If that practice were adopted by all major firms, it would give a great measure of security. As I see it, one of the reasons for the Bill is to reduce the amount of money in circulation drawn by cashiers at various times in the week, thereby reducing the number of hold-ups which occur throughout the country at fairly frequent intervals.
In my constituency I have seen young girls of 15 or 16 years of age drawing money from the bank, with no escort and with no proper bags. It is not right that employers should put such people in that position. They may not have far to go, but it is easy to snatch a bag and run. I have also seen a man stuff over £500 into a small suitcase, with no escort and with many other people watching. Far too many firms are inclined to give the coinage breakdown in advance on the telephone and their rendezvous for 408 collecting money is at the same time every day of the week.
Sometimes those who are drawing the money take the same route. In some cases there is an escort; in others there is not. Every firm can, and should, make adequate security arrangements when drawing wages. I am sure that many firms do so. Also, it is wrong that cashiers, who are not highly paid, and sometimes are extremely young, should be handed vast sums of money without adequate security. They should not be put in that position.
Recently, I noticed that a distinguished ex-police officer is to start a firm in this country, similar to one in the United States, I understand, which, for a small consideration, will supply an armoured type car or vehicle for use when drawing large sums of money. That is a most commendable project which could well be adopted by our larger firms without very heavy overall cost.
The payment of wages by cheque will not greatly reduce the administrative costs of big offices. My short business experience has convinced me that a lot of work is put into authorising and franking cheques which, inevitably, go through the hands of a large number of people, and in many of the big firms there are special franking machines as well. These are all expensive items of office equipment and, added to these, there is the cost of money orders and postal orders.
Though I am a layman in these matters, I cannot think that the administrative costs of a large organisation will be much reduced by the Bill. This is a desirable Measure to bring our country into line with modern conditions, and it is right that more people should be encouraged to open banking accounts. However, there will be difficulties in the early months of the implementation of the Bill when it becomes an Act and, as it states, it is up to the employee to decide how he wishes to have his wages paid. In my constituency I think that things will probably remain very much as they are now, at least for some time to come. But as experience is gained, and in the light of improving security, generally speaking this is a Bill which will be for the good of the country in the years ahead.
§ 5.7 p.m.
§ Mr. Richard Marsh (Greenwich)
It is an unexpected honour for me to have the opportunity of congratulating, as a Fellow "new boy", the hon. and gallant Gentleman the Member for The Hartlepools (Commander Kerans). Although it is unexpected, I must emphasise that it is extremely pleasant, because none of us has a greater sympathy with those who are newcomers to this House when making their maiden speeches than those of us who are newcomers to this House who have just made their maiden speeches and have spent several weeks realising the number of things that could have been said to make the speech better than it was.
The speech made by the hon. and gallant Gentleman was all the more important because he was able to place his finger so accurately upon many aspects of industrial psychology which are involved in the Bill and which are missed by many other people. I feel envious of the skill with which the hon. and gallant Gentleman was able to relate the Bill to his constituency. This has filled many of us with a great foreboding, because we were hoping that his seat in that quarter would be only temporary. None the less, if it is not being presumptuous, I wish the hon. and gallant Gentleman, on behalf of the House, every success in his career here and congratulate him on a speech which many of us who are also new would have liked to have made.
Following on that, I wish to say a few words on the Bill, because it is an extremely important step. Its importance is indicated by the tremendous pressure which has arisen against attempts to revoke the relevant Sections of the Truck Acts. Reference was made earlier to the historical aspect of this part of the Truck Acts and my right bon. Friend the Member for Blyth (Mr. Robens) paid some attention to the position during the war, when the County Councils' Association forced many county madmen to accept payment by cheque. As he said, in 1942 there was a High Court judgment which declared it illegal. Despite that, the then Minister of Home Security, now Lord Morrison of Lambeth, introduced Defence Regulation 59A, and it was not until 1947, that some manual workers ceased to be paid by cheque.
410 One of the problems involved in this issue is the difficulty of getting across to those people who are not intimately concerned an appreciation of the strong feeling which exists among many manual workers when this matter is raised. It is natural and understandable that people who, for many years, have had a bank account, who have been paid by cheque and who have paid cheques into their account and seen those cheques returned, sometimes in unexpected ways, should regard this as a perfectly sensible, normal exercise. I therefore have considerable sympathy with those who, for many years, have been bewildered, and, indeed, annoyed, at the opposition to any change in the Acts. However, the causes of that opposition must be understood.
I was very suspicious when I first heard that the Bill was to be introduced, but my suspicions were somewhat allayed when I saw it. I realise that the Government have done everything they can to ensure that there is a voluntary decision on the employees' part, which is very important. But it does not prevent some of us wondering whether it is possible to ensure the voluntary character of the observance of the provisions of the Bill. The ways in which employers can apply pressure to employees are many, devious, and sometimes diabolical; and if employers can exert pressure upon employees to accept payment by cheque instead of in cash, many of them will do so.
I am sure that hon. Members on both sides of the House will agree that many important considerations are involved in the Bill. In terms of the saving of money and manpower it could mean a great deal to employers, and it is only natural to expect them to be very keen to ensure that as many as possible of their employees accept payment by cheque. I have little doubt that many persons applying for employment, especially in small firms, will be asked if they would like to be paid by cheque, "since most of the staff are paid by cheque", and little doubt, also, that a person wanting a job might think twice before saying that he did not want to be paid by cheque. Pressure will be applied; it remains to be seen to what extent it is applied.
Why do employees object to payment by cheque? It must be understood, first, 411 that not all employees earn a large wage, or take home large earnings. We talk very much about the new society, with its wealth and security, but we are in danger of forgetting that there are many people whose earnings—not basic wages; we are fully aware of the difference between basic wages and earnings—are very low indeed. In the National Health Service, which is a Government industry, the lowest wage today is £8 10s. per week. Not a great deal of overtime is worked in the hospitals, because this is a service which has to have a consistent staff, which cannot vary to any extent. By the time superannuation and National Insurance contributions have been paid tens of thousands of them take home less than £8 a week. In local authority services the lowest wage is £8 9s. a week, and many of the people earning that wage take home less than £8. It is very inconvenient for a man with that kind of wage to be paid by cheque, and in any case he can ill afford the bank charges.
But the matter goes further than that. Not all employees are employed or live in areas where banking facilities are available without considerable inconvenience. Further, not all employees are free during banking hours. This is an extremely important factor. This consideration applies to many people who are at present legally paid by cheque. They suffer great inconvenience as a result. One of the reasons why I regret that the Bill came forward at this time is that a re-examination of the Truck Acts might well take into account the question whether facilities being offered to manual workers can be extended to those non-manual workers who are at present frequently paid by cheque regardless of their low earnings.
A typical example, with which I have had a great deal to do, is that of nursing staff. The wages of many of these people are almost derisory. After their deductions and various payments have been made, the amount they take home is frequently very small. They are frequently paid by cheque; they are frequently on night duty, and, therefore, have to stay up, after being on duty all night long, until almost mid-day to cash their cheques and draw their wages. The provisions of the Bill could be extended 412 to many people who are now excluded. That is one reason why I should have liked to see the Bill held over until it could be presented as part of a more comprehensive attempt to settle many of the existing anomalies.
Reference has been made to Clause 4, which many of my hon. Friends have examined with great care. It is regrettable that even in this one instance power should be given to an employer to pay an employee other than cash, and other than in person, without obtaining his consent. Why do employees object to this method of payment? I have often been told that many working men do not like their wives to know what they earn. I well remember an occasion when I met the secretary of a large group of hospitals in London, to make representations to him against this practice, which was being continued in respect of certain of his staff. At that time I had not been a trade union official for very long and I had a conscience. I was sorry to lose my conscience in October, when I joined hon. Members in this House.
I felt very worried about having to put forward an argument which did not seem to be a very good one, and to say to the secretary, "One of the reasons why these men do not like being paid in this fashion is that they are afraid that their wives will find out what they earn." To my horror, the secretary said, "You know, Marsh, I had not thought of that point. When I come to think of it, I would not like my wife to know what I earn either." This question does not affect hon. Members, because everyone knows how much they earn, and the one thing upon which hon. Members are all agreed is that it is not enough.
§ Mr. G. Wilson
Would the hon. Member like to explain why these men object to their wives knowing how much they earn? Is it not because they want to give their wives the impression that they are earning the same amount as before when, in fact, they have had an increase and have not disclosed it to their wives?
§ Mr. Marsh
I do not think that it is as simple as that. It is something which, to many of us, is quite illogical and difficult to understand. It is not a question of dishonesty. It occurs in families where husband and wife have the best 413 of relationships and there is an honest and genuine attempt to share the financial burden. It is largely traditional. Frequently it is as much defended by the wife as by the husband. It stems from a belief that the man is responsible for the financial administration of the home. It is not the case in my home—if it were, I should have become bankrupt long ago—but it is the case in many working-class homes.
There is a strong feeling that what the man gets is his business, and one of the fundamental failings in industrial relations is that it is unimportant. Whether or not it seems silly, all that is important is whether it is important to the employee. Employees do not like this method, and it would be regrettable if it were made possible for employers to take this line without the wish of the employees.
In an issue such as this, where there has been a great deal of discussion on both sides, it would have been better to present a complete and comprehensive Measure dealing with the whole situation and all the anomalies arising from a very old and much out-dated Act. That has not been done. It may seem that this Measure is an attempt to worsen the conditions of some workers. I appreciate that that was not intended, but I feel that some employers will use pressure to make employees conform to something to which they would not conform voluntarily.
For many people the difficulties of cashing cheques are enormous. My right hon. Friend the Member for Blyth quoted the normal procedure of going to the local shopkeeper or publican. It causes me a great deal of worry to be told that in some country districts members of the clergy, with the aid of the collection plate, are also able to help out. In whatever way it happens, it is undesirable that any employee should be placed under an obligation to traders of any kind.
Although I regret that we have the Bill before us now, since it is here I hope that the Minister will give even closer attention to the possibility at least of removing Clause 4, and certainly of considering whether it is possible to make the provisions of the Bill applicable to many other people who would like the protection which it affords and who 414 sometimes earn less than many of those who are protected by it.
§ 5.21 p.m.
§ Mr. Graham Page (Crosby)
The House cannot say that this subject has been insufficiently debated. We have already had two Second Reading debates on this subject on previous Bills, and today we are having a third. It is difficult to find new points to make.
I compliment my right hon. Friend upon his most interesting opening. The historical background which he gave was new to us all. The right hon. Member for Blyth (Mr. Robens) took exception to the fact that the Bill deals with only part of the Truck Acts, as did the hon. Member for Greenwich (Mr. Marsh), but the National Joint Advisory Council agreed that this matter should be the subject of separate legislation ahead of the report of the Karmel Committee, and there is Trades Union Congress representation on that Advisory Council.
I cannot believe the story put forward by the right hon. Member for Blyth—I am sorry to criticise something he said when he is not here to answer—about the previous Minister of Labour apparently bullying the National Joint Advisory Council into accepting the Bill. That seems rather ridiculous. After several years of opposition to the principles embodied in the Bill the T.U.C. accepted it with the safeguards which my right hon. Friend has put to the House.
In view of all the debates which have taken place on this subject in the past four or five years all the points raised in opposition to the Bill ought now to be before hon. Members and the public. One would have thought that if there was any real opposition to its principles that opposition would have mounted in that period. Instead, it has dwindled. I can find only three organisations or bodies of a national character who object to the princple now. They are the National Amalgamated Union of Life Assurance Workers; the National Union of Public Employees, whose opposition is practically traditional, and the National Check Traders' Federation.
I will deal, first, with the objections from the National Amalgamated Union of Life Assurance Workers, and in doing that I shall pick up some of the points 415 which the hon. Member for Greenwich and the right hon. Member for Blyth have made.
The National Amalgamated Union of Life Assurance Workers put before a conference of unions for non-manual workers earlier this month a resolution saying that it was not in the best interests of the workers affected to be paid by cheque. It seems rather strange that such a union should put that forward at a conference of unions for non-manual workers, and I reiterate that the Truck Acts do not apply to non-manual workers. There are no restrictions on paying non-manual workers by cheque. That is what makes the present position so anomalous.
§ Mr. Marsh
The only point about the moving of that resolution at a conference of non-manual workers is that, although it was apparently silly, at that conference there were representatives of the National Union of Bank Employees, who had a strong view—although in the opposite direction—and the resolution was a very live issue at the conference.
§ Mr. Page
So far as I can discover from reports of the conference, the resolution was defeated and one in exactly the opposite direction was passed, accepting the principle of payment of wages by cheque to manual and non-manual workers.
The argument against the Bill is quite untenable, because, to be logical, those who argue against paying manual workers by cheque must take their argument the whole way and initiate legislation to apply the Truck Acts to non-manual workers. It is anomalous that at present manual workers must not be paid by cheque or through a bank while the non-manual worker can be so paid. To be logical, those who argue against the payment by cheque of the manual worker should initiate legislation to apply the Truck Acts to all wage earners—and what an outcry there would be from the trade unions if that occurred! Indeed, we should be accused in Parliament of interfering with the freedom of contract between employer and employee. We would, in fact, be so interfering, quite wrongly. I think that we have been interfering quite wrongly up to the present by retaining the Truck Acts and I am very glad the Minister 416 has brought forward the Bill to abolish that legislation.
I add that members of the National Union of Amalgamated Life Assurance Workers are the people who collect "the penny a week at the door" on insurance policies, the industrial life assurance men. Perhaps the true reason for their opposition is that they feel that there might not be the cash in the house to pay the industrial insurance premium when they call to collect it. I wonder whether they have checked up on how many of their customers already have bank accounts.
I pass to the objections of the National Union of Public Employees. The opposition of members of that union to this principle is almost traditional, because they recollect payment by cheque being imposed on their members. A resolution which they recently put forward at their conference shows in the first sentence by the word "impose" what they had in mind. That first sentence reads:This Conference with bitter memories, recalls the evils of the cheque system during the years it was imposed on the manual workers employed in the local government service.The Bill does not impose anything on anybody, and that is the distinction which the National Union of Public Employees fails to make when it objects to this Bill. Some extraordinary arguments were used to support its opposition to the payment of wages by cheque. The general secretary, Mr. Bryn Roberts, used such arguments as:… an obligation on the banks which they are not designed to carry.Indeed, in earlier speeches today we have heard that the banks are not designed to meet that obligation.
Mr. Roberts went further and said:Pay day is an important event. The expected wages are already earmarked for urgent household requirements. Within a short time of being received, the housewife is out buying the weekly shopping …That is very picturesque.
§ Mr. Page
And very true, but the facilities given by the Bill wilt obviously not be adopted unless the banks can accommodate employees at times of the day and in places in which employees want to receive their cash. The facilities given by the Bill will no doubt come 417 about through agreement between the unions and employers, or a union and an employer, but a third party to the agreement will be the banks. Neither side will be willing to agree unless the banks can give ready facilities. I understand that the banks are quite prepared to do that as the requests are made.
Another argument put forward by Mr. Roberts was when he described banking as follows:To get to the bank will cost him"—that is, an employee—bus fares. He will have to be identified by the manager. If he satisfies the manager he will then have to trek home to give the cash to his wife—unless he loiters on the way … Instead of smash and grab at the local post office we shall have riotous assemblies at the local bank.The arguments of the hon. Member for Greenwich were reasonable and genuine, but the sort of thing which we have had from the National Union of Public Employees is rather ridiculous and certainly not worthy of being called reasoned opposition to the principles of the Bill.
The third national objector which I mentioned was the National Check Traders' Federation—spelt "check" and not "cheque". I do not know whether that is an American spelling, or whether it means something else entirely. I believe that members of the Federation are the people from whom one buys credit slips for changing in the shops to buy clothing, for instance. The more that bank accounts increase, the less will be the need for that sort of service.
I gather that the federation has sent a letter in rather exaggerated terms to all Members. I will not bother to deal with all the points in it, but one sentence says:It is our belief that the general public needs protection against the consequences of its own folly.That is rather an insult to the manual worker. It is also suggested in the letter thatthe banks will be given a power to restrain the whole or part of the wage to cover debts due by way of overdraft.Again, that is a suggestion that the ordinary manual wage earner is a most irresponsible person. How can it be suggested that the manual worker is more irresponsible, more of a fool, than 418 the non-manual worker? Of course he is not. I should have thought that 99.999 per cent. of the people now know how to run a bank account. The sort of joke which the hon. Member for Greenwich made about the woman who thought that what she wrote on the cheque the bank would pay out is a very good music hall joke, but does not accord with the facts these days.
§ Mr. Page
I beg the hon. Member's pardon. Perhaps it was my hon. and gallant Friend the Member for The Hartlepools (Commander Kerans), who was also criticising the principles of the Bill.
The argument of the hon. Member for Greenwich about secrecy as between husband and wife is outdated and outmoded. I do not believe that in many families there is now this secrecy about what a husband earns. If there is, receiving his wages through a bank account, or by cheque, gives him more opportunity of maintaining secrecy, if he wants to do so, than having cash in a wage packet. We should not hold up legislation, beneficial legislation of this sort, on that sort of ground.
The permission contained in the Bill for the manual worker to be paid by cheque, or through a bank account, if the worker so agrees, will be of considerable benefit in that it will promote thrift. There can be no doubt that if a man has a bank account, he is encouraged to leave a little in the account and to save it. If the banks provide proper facilities for regular deposit of part of a man's wages, thrift will be considerably promoted That is the case in Canada, where it is very common for manual workers to be paid by cheque and for them to give their banks directions to set aside £1 or £2 a week on deposit which earns interest immediately the cheque is paid in. The wage earner thereby saves and it has been shown that wage earners respond to that sort of system.
The system will also be of great advantage to employers. Here, again, I could not understand the attitude of the right hon. Member for Blyth. He seemed 419 to complain bitterly that the Government had brought forward a Bill which would allow employers to make economies. He accused my right hon. Friend of dishonesty and almost of deceit in this matter. His whole attitude seemed to be that we should not have a Bill which would allow employers to make economies in the running of their businesses. Surely all in industry—
§ Mr. R. E. Prentice (East Ham, North)
What my right hon. Friend was saying was that the Bill had been presented as though for the workers' benefit, whereas the people who had been asking for it, on the whole, had been employers' organisations and the banks. My right hon. Friend was saying that it would have been more honest of the Minister in debate to give that as the major reason for bringing the Bill forward.
§ Mr. Page
It will be beneficial for the country, because employers will be able to cut down unprofitable time. It will benefit employees as well as employers, because there is sufficient strength in the trade unions for them to claim to share in any savings which they see made on those lines and to argue with the employers for that share. There will be a reduction in unprofitable time individually for the employees, too, because, although some of the criticisms of the Bill have been that employees will have to queue at the bank, at present they queue at the pay office, sometimes having to walk long distances from the places where they work, to the places where they are paid, there waiting a long time.
The suggestion that the wage earner will cash cheques with small shopkeepers and in "pubs", and so on, has been found unjustified in places where the system has been tried. The Pye Radio case is a famous one. The firm did not realise that it had been doing anything illegal, but while the scheme operated for about eight months no shopkeeper objected. No shopkeeper came forward to say that he had to carry a large float to cash the employees' cheques. At first Pye Radio set up a cash desk within its factory for the employee who was paid by cheque so that he could cash his cheque there and then if he wanted to. That facility was not used by the employees and was closed after a short time.
420 The same thing happened at Fords, in America. The company started to pay its employees by cheque. It set up a cash desk at the gates of its factory where the employee could cash his cheque if he wanted to. After a few months the cash desk was closed because it was not used.
The objection from the small shopkeepers is not confirmed by the body which represents them, the National Chamber of Trade. This body, which represents about 400,000 shopkeepers, passed a resolution some time ago asking for the payment of wages by cheque to be legalised.
I am sure that this is not a real objection. It may be feared by some, but it has not turned out as a real objection in practice. The real joke, if I may put it that way, about this legislation is, as the Minister said, that the Truck Acts were never intended to prevent the payment of wages by cheque. Section 8 of the Act of 1831 authorised the payment of wages by cheque. We have to bring this legislation into being because of a sort of side wind—the banks ceasing to be licensed to issue bank notes. All that we are doing is not really abolishing any provision of the Truck Acts, but restoring that provision of the Acts whereby they made an exception to the general rule that an employee must be paid in the current coin of the realm.
Before I conclude I should like to mention two small Committee points to my right hon. Friend, so that they may be considered. The first point concerns Clause 3 (2), which says that the request to withdraw shall take effect at the end of a period of a fortnight. I am informed by those firms that have installed automation and mechanisation to deal with wages that a fortnight is too short a time in which to change the system. A period of four weeks would be more suitable.
The other point concerns Clause 7 (4, d, ii). This Clause defines savings banks, and it also includes within the definition certain types of savings banks run by employers. The final words of the paragraph read:… but without deriving any benefit from the deposits or produce.I understand that many of the big firms put these savings on deposit and earn a deposit interest. It is feared that those 421 words might exclude many of the very well-known savings schemes of the bigger firms. I would be most grateful if my right hon. Friend would look at that point.
I hope that the Bill will commend itself to the House. The right hon. Member for Blyth was most flattering in suggesting that my right hon. Friend the previous Minister of Labour gave way to pressure from the back benches on this side of the House. I rather thought that I was a lone voice crying in the wilderness for four or five years, and I did not think that that lone voice could possibly have exerted any such formidable pressure. I was only too happy that my right hon. Friend took over the Bill and has produced a far better draft than any of the previous Bills which have been before the House.
§ 5.45 p.m.
§ Mr. A. E. Hunter (Feltham)
I wish to speak briefly on the Bill, which concerns manual workers only. The hon. Member for Crosby (Mr. Page) has been persistent in pursuing the policy of paying wages by cheque. He has now been rewarded by the presentation of the Bill by the Government.
I do not oppose the Bill, but I want to make sure that manual workers are protected. I do not think that there are many unscrupulous employers today who would want to put pressure on workers to accept this form of payment if they were against it, but one must remember that the Truck Acts were designed to protect manual workers.
Paragraph 1 of the Explanatory Memorandum refers to the Truck Acts, 1831 to 1940. Parliament amended the Truck Acts in 1940 and I know some of the history of why that was done. It was not a case of payment by cheque. One firm in the City of London deducted 10s. a week from its manual workers as payment for dinner and tea. Its workers were compelled to pay for their dinner and tea out of a very small wage—probably under £3 a week—when they would rather have had the 10s. a week to help their families in their homes.
422 That case went from the King's Bench Division to the Court of Appeal and then to the House of Lords. It was a test case and the House of Lords decided in favour of the manual workers. There was a settlement in the case of that firm, but the result meant that many employees all over the country could have brought an action against their employers because deductions had been made from their wages for dinner and tea, and they could have recovered the money paid in over many years.
The amount of money involved was so large that in 1940 the Government amended the Truck Acts. If any hon. Member wishes to read the history of that he will find it reported in the OFFICIAL REPORT of that time. He will also see that the Truck Acts were designed to protect manual workers. We should therefore bear that in mind.
There are several points I should like to put to the Parliamentary Secretary. It may be that at some future date a firm will change over to the system of payment by cheque. If other manual workers join the firm after that date and do not want the cheque system but want to be paid in cash, we must ensure that payment of wages by cheque will not be made a condition of employment. That is very important and I hope that we can provide that safeguard.
There is another point which I put to my right hon. Friend the Member for Blyth (Mr. Robens). It may not arise very often, but a small firm may be in difficulties. It may be expecting a cheque on, say, Wednesday or Thursday, but the cheque may not arrive. If on the same day the firm issues cheques for wages, those cheques will not be met. After all, through no fault of its own, a firm may get into financial difficulties through somebody owing it money. Perhaps the Parliamentary Secretary will consider that point.
The Bill could be amended during the Committee stage to ensure that these facilities were granted to firms with a substantial financial basis which have received recognition from the banks. I am certain the hon. Members opposite who support the Bill will recognise that we must have safeguards of that type.
I am anxious that the Minister should refer to the point I have made that payment by cheque should not be made a 423 future condition of employment and that there should be safeguards against cheques "bouncing" and workers being faced with the prospect of receiving no wages at the end of the week. I am reminded of a story which I heard many years ago about a famous jockey. I will not mention the name. When he won his races he received large sums of money with which he opened a bank account and he started signing cheques. A few months later he was told that he had no money in the account. "What", he said, "I have no money? Why, I have a book of cheques." In our consideration of this matter we must remember that that may be the point of view of some people.
I do not think there has been a great demand from manual workers for this method of payment. The hon. Member for Crosby made some sound points. This method of payment would strengthen the safeguards against holdups and robberies, and the Bill may be supported from that point of view; but I feel there should be safeguards to ensure that no pressure is put upon manual workers to accept this form of payment. We must also ensure that there are facilities in towns and villages for the cashing of cheques. Perhaps some arrangement could be made with the post offices through the Postmaster-General, and with the banks. Parliament passed the Truck Acts to protect manual workers who, as a condition of their employment, had been compelled to agree to certain amounts being deducted from their wages for food, and I wish to make sure that similar demands are not made in the future and that manual workers are not compelled to accept payment of wages by cheque.
§ 5.54 p.m.
§ Mr. W. R. van Straubenzee (Wokingham)
This House is traditionally very kind to an hon. Member who is speaking here for the first time and already it has exercised that indulgence once this afternoon. I am afraid that the House, if it will be so kind, will have to forgive a number of my inadequacies, and I will try to be brief. I hope that the hon. Member for Feltham (Mr. Hunter) will acquit me of any discourtesy if I do not follow him strictly, except respectfully to draw his attention to Clause 6 (7) of the Bill and to ask whether he does not 424 feel that that trenchant Clause meets the first of the two very proper objections that he raised. I say that to the hon. member with respect, because the price I pay for the indulgence of the House is that I must avoid all forms of controversy; but I wonder whether that may not be the case.
The other point, a valid one, which the hon. Member raised is one which we can examine during the Committee stage. We are all aware of some small businesses of a tenuous financial nature. I am not at all certain whether mere payment by cheque as distinct from payment by cash places an employee in any worse position. In any event, he, of course, has his rights at law, though as a lawyer I say that with diffidence because I realise its impracticability in this connection.
I hope that the Bill will receive a Second Reading and that eventually it will become law. In modern conditions it is an anachronism that there should be an absolute bar on the payment of wages in any other form than by cash for so many of our employed people. Surely that will be agreed by hon. Members on both sides of the House. I would, however, draw the attention of the House to the fact that this is not a Bill for the payment of wages by cheque. Quite a number of hon. Members have referred to the "Cheque Bill". With respect, it is not that.
There are four methods of pyament, one of which at least, in my judgment, will be quite as important as the strict payment by cheque. That is the payment direct into a bank account. As the chairman of one of the big banks remarked the other day, we shall have progressed but a few inches forward if all we do is to present a worker with one piece of paper which almost simultaneously he translates into other pieces of paper. It may well be that payment direct into a bank account will have considerable ramifications in the future.
Many of the points which have been made have also been underlined and I wish to try to avoid repetition, but I suggest that if the Bill becomes law it will give great responsibilities to the banking profession. I know that I must avoid controversy, but I do not think I shall be going outside the accepted conventions if I express regret that among some—I repeat some—members of the 425 banking profession at the junior levels there seems to be a reticence about this Bill and an attitude that it will mean more work.
This does not appeal to me at all. Actually it will mean immensely increased business, and one does not get an immense increase of business without greatly increased work. Let it be stated frankly that the heads of the banks are displaying a very forward-looking attitude in this matter, and so are the vast majority of individual bank managers. But there exists a bit of "dead wood" happy to drift along in the old accepted style. These people recognise a certain class of person whom they regard as accustomed to using cheques, and the idea of a rather different type of person coming in and perhaps demanding changes in the established habits is not very acceptable to them. I hope that this House will tell them not to be so appallingly conservative but to look forward to the possibility of increased business.
I hope that the hours of banking will be examined. It may well be that on certain days of the week this will present a problem. I recently had the advantage of talking to a group of bank employees and I was surprised at the manner in which they were prepared to examine some of these matters. I hope that the structure of the bank buildings will be considered. Some of the bank buildings resemble the sort of place one goes to in order to bury a relative. There is an appalling feeling that it is a morgue and there is a rather superior white-collar approach from one side of the counter to the other.
Many of the people we have in mind as those who will benefit from the provisions of this Bill are deeply suspicious of the whole monetary system and the business of payment by cheque. They think it is one large "wangle". I accept the trenchant testimony of the hon. Member for Greenwich (Mr. Marsh), I claim general credit for his training and preparation to become an hon. Member of this House. For many years near Transport House the hon. Gentleman used to sit under me as a Young Conservative chairman, and I feel sure that this did much to help him. I always hoped that he would take the final step and come to sit on this side of the 426 House. I consider his comments were fair and proper and that there will be a new outlook among those who operate our banks.
My next point may be regarded as a point of detail but I raise it in all sincerity. It relates to the actual form of the cheque. I wonder how many hon. Members have met someone who has never actually operated a cheque or tried to fill it in. I suppose that all hon. Members have asked the Fees Office to pay their salaries into their bank account, and that they do not get paid in cash, although I think they would be entitled to be so paid if they wished. We are all accustomed to the sight of a cheque. It begins "Pay". Does that mean, pay Mrs. Smith or pay the money? This is the sort of problem which has to be faced. Why have all the hieroglyphics? Why make it such a difficult document? The people we have in mind do not desire to reveal their ignorance in public. They have their pride in these matters. It may well be that Parliament will have to assist the banks in being forward-looking in this matter, because we come into this, since the cheque largely stems from the Bills of Exchange Act and the definition of a bill of exchange.
I apologise for mentioning such detailed points, but if this Measure is to succeed it must attract the confidence of a new group of people who have not previously considered this method of payment. Were it to be compulsory I should be wholly against it. I do not expect an immediate mass of new bank accounts in an area like the new town of Bracknell, but to talk about the old style and method is to be wholly unrealistic. Something of this kind will meet the needs of many people.
I will be frank about my hope for the Bill, which is that it is only a beginning. Before becoming a Member of this House, I sat for some months under the chairmanship of my right hon. Friend the Member for Blackpool, North (Sir T. Low) as a member of a committee set up by my party to investigate the problem of much wider share owning—upon which it would not be proper for me to comment today—and I am convinced that the first step is a bank account. I wish to see far more people in this country associated with our business and industrial systems. It is a 427 criticism of my own party that there are not more people so associated. If I do not pursue that matter, it is because that is not a feeling which appeals to every hon. Member, and I do not wish to trespass upon the kindness of the House on this occasion. May I express the hope that nothing I have said will jeopardise the passage of this Bill? I believe it to be a modest Measure, a voluntary Measure and one with very much good in it.
§ 6.3 p.m.
§ Mr. Charles Mapp (Oldham, East)
I can only hope that after being captivated by the speech of the hon. Member for Wokingham (Mr. van Straubenzee) I have not forgotten the substance of what I wish to say. I pay the hon. Member high tribute for the attractive way in which he put many of his points. This is only the second occasion on which I have addressed the House. I can always listen to such happy contributions from hon. Members opposite although I may not be so happy in my own remarks. In a general sense, our debates will be improved by such speeches.
My first diagnosis of the Bill is that in terms of business management it affords considerable material advantages to the managements of large industrial concerns. Indeed, if such advantages were not likely to accrue, it is more than doubtful whether we should be discussing the Bill today. It is because of those advantages which can accrue to modern management that, in effect, the facility which we welcome is to some extent a by-product to the worker, and I regret having to acknowledge that analysed fact. Because it is something of a by-product it should not necessarily be opposed. I welcome the step forward. I raise a number of points, two or three of which are basic, merely with the object of improving the scheme. I am glad that the Minister is present to hear my suggestions.
A point of detail is that today most workers receive their pay on Fridays. I do not know whether it will have to be provided in the Bill, but we shall have to ensure that the accountancy arising from this is such that the document given to the worker in the form of a piece of paper can be transferred to currency at least on the same day, namely, 428 Friday, which may mean the issue of cheques or postal orders the preceding day. If I felt that there was some doubt about that after the Committee stage, I should have to reserve my judgment on the Bill, because I do not want to see the pay of a manual worker being received later in the week than at present. If modern management were wise, it would be searching constructively for a way of bringing the pay day earlier in the week.
This may be a controversial point, but it nevertheless is true that those of us who have had the opportunities for years of visiting banks for our salaries have practically, without exception, done so in the firms' time. The Government may have to face the argument, using the jargon of the workshop, "If that is good for the governor, why is it not good for me?" I do not pose the problem to the House, because I do not wish to see it arise, but up to a few months ago I was one of those in management who had the problem of meeting staff and dealing with points raised by them. I did not have to deal with this point, because it has never yet arisen.
My next point concerns the location of either the bank or the Post Office in relation to the firm adopting the arrangement. I shall return to the Post Office point in a moment, because that was a very material factor in the Minister's statement this afternoon. If the Post Office or bank is any distance from the point of employment or the worker's home centre, difficulties will arise concerning time off. The banking circles will then have to consider providing banks not only in shopping centres but in residential areas. An instance could be the provision of banks in the area near which I live, which is typical suburbia composed almost entirely of houses with few shops. We do not want banks there at the moment, but there may be a demand for them in the future, and equally for Post Offices.
Unless there is a dispersal of bank and Post Office facilities, industry will be faced with the position—I can picture Oldham or Trafford Park where these problems will present themselves—where workers will be given their pieces of paper and will reply, "We want the money." Unfortunately, many of them have obligations at mid-day, a subject 429 about which another Committee is talking. Perhaps on odd occasions their wives will visit their places of employment. I have had experience of that happening, and they are not isolated instances. Anyone who has been concerned with the management of 500 or 600 workers will know that this happens. This possibility must be legislated for or taken account of in legislation.
My next point is rather basic and follows on the Minister's statement about Post Offices. Apart from my personal likings, I have a feeling that many workers will regard the Post Office as their vehicle of exchange in these operations. The Minister this afternoon said something to the effect that the Post Office Savings Bank does not lend itself to this form of activity and that some small legislation may be necessary to permit this to take place. I want the Minister to consult with the Postmaster-General and to look at the future not in terms of four or five years, but in terms of the fact that the Post Office may become the principal vehicle by which workers will draw their wages and where they will accumulate their small margins week by week. If I find at the end of our treatment of the Bill that there are still obstacles in the way of the expansion of the Post Office service to meet this demand, I shall certainly have to withhold my support for the Bill until such time as the vehicle at the workers' disposal for operating the sentiments of the Bill is provided.
The Minister said that application can be made by the employee for this form of payment. He added that he saw no reason for the employer to tell the employee in writing that his request had been accepted. I beg the right hon. Gentleman to change his mind. If a workman submits an application on Thursday, he will not know when it reaches the operative personnel department. He will not know when the firm has passed it through the bank or otherwise. Is it not sensible, reasonable and businesslike to provide a form at the bottom of the application saying that the application has been received and will be operated from a certain date? That would be a much tidier arrangement and would relieve the employee of any uncertainty about when the payment would be effected.
430 I turn to the question of juniors in industry. Perhaps the extreme case is the paper-boy. It must be remembered that in the employment of juniors all sorts of persuasions can be operated. I appreciate that an attempt is being made to write some safeguards into the Bill, but for juniors aged 15, 16 or 17, especially on the female side, perhaps additional safeguards should be provided. In the ordinary humanities of life, the management should meet the staff. The staff would appoint the most representative amongst them to speak for them. Can we not write into the Bill a provision for some form of consultation? This would be in harmony with the age in which we live and with the understanding we all want to see between both sides of industry. It is not something about which there can be any fundamental conflict. The management side is not always aware of the humanities of the people on the workshop floor, because the persons comprising the management left the workshop floor, in many cases, so many years ago.
The sudden death of someone in the scheme would cause a real problem. In the field in which I was interested before entering the House of Commons, when we heard of the death of one of the staff we did not argue during the next ten days about who would have the remaining wages. We tried to ensure that they were paid to the person we thought was the responsible member of the family. If the payment is to be made from a bank, a totally different position will arise. The wages may be held until such time as the estate is sorted out. That would be tragic. It is just at a time of bereavement when a widow or other members of the family want all the wages which have accrued to the deceased in order to meet immediate needs.
I take strong exception to Clause 4 providing that this can be done without the consent of the individual. It is outrageous that the Minister should wish the House to provide that Clause 4 shall come into operation one month after the enactment of the Bill. There should be an interval of at least six months. Parliament should ensure that such matters are discussed between management and employees so that in the event of an employee being sick or working 431 at some other point or place in the firm's establishment there is an accepted understanding between him and his employers. I beg the Minister to reconsider that and to ensure that an interval of at least six months is provided. One month is very arbitrary, and I can see difficulties in the operation of the Clause as it stands.
My last point is general. The Bill concentrates, because of the Truck Acts, on wages and manual workers. I am one of those who feels—I sense that there are many on these benches who feel the same—that if we can tidy the Bill and write into it safeguards needed on both sides, employers and employees, it could be made properly to cover all employees, whether salaried or wage-earning. I should like to see that provision written in so that the facilities can be available to all people in employment.
With those general comments and my three major reservations, I welcome the Bill and hope that in Committee we can make a better job of it.
§ 6.17 p.m.
§ Mr. Kenneth Lewis (Rutland and Stamford)
In rising to address the House for the first time, I ask for its indulgence, knowing that the generosity extended by the House to new Members will be accorded to me. I hope that after I have spoken I shall not find myself in the position referred to by the hon. Member for Feltham (Mr. Hunter), who seemed to be rather concerned about a "bouncing" cheque, and that at the end of the month I shall not receive a cheque which is made of rubber.
I start by paying a tribute to my predecessor who was Member of Parliament for Rutland and Stamford for many years. It would be invidious for me to try to say anything about his service in the House. Right hon. and hon. Members knew him. He deserves, as does any hon. Member who has served for so many years, the thanks of those both inside and outside the House.
My constituency confers two distinctions upon its Member of Parliament. The distinctions have nothing to do with the Member. First, any Member for Rutland and Stamford represents the smallest county in England, though not the smallest county in the United Kingdom. 432 He represents also the most beautiful, the most hunted and the most envied county for a take-over bid. I know that the county will always remain the most beautiful. I hope that it will always remain the most hunted and that it will continue to escape a take-over bid. Also, in representing Stamford, it would probably be fair to say that I represent the most beautiful "jam-up" on the roads in the United Kingdom, and I am glad to know that my right hon. Friend the Minister of Transport intends very shortly to put that right.
There is a second distinction. When I am in the middle of my constituency I am naturally surrounded by it, but when I am in this House I am also surrounded by my constituency, for this building is made of Clipsham stone. Supplies of this stone will very soon run out. The quarries are now almost at their last lap, and my noble Friend the Minister of Works might think it worth while to survey the county to see whether there is more stone; and he might also take steps to preserve what stocks there are lest in decades to come this House should find there were no further supplies for the maintenance of the facade.
It is perhaps fortunate that I have been able to say something about my constituency because so much that I wanted to say about the Bill has already been said. However, if I repeat what has been said, I hope that the House will forgive me.
I have not always had a connection with the broad acres that we find in Rutland and in Lincolnshire. I know well the confined areas of the industrial North and the begrimed environment to be found there. Like many, I have for some years picked up my wages in cash. I remember that when I first began to get them I was rather puzzled because they were split into wages and offtakes and it often occurred to me that if they paid me the offtakes and kept the wages I would be much better off. Again as an aircraftman, I often had to queue up on pay parade, and I never thought that the bullion we received quite justified the "bull" that was involved in getting it. Therefore, if for no other reason, this Bill appeals to me because I think that in due course it will help to get rid of the queue for pay.
The Bill may give advantages to the employer but there are also a great many 433 advantages to be gained by employees and by the country as a whole. I am very glad to know that after all this considerable time the National Joint Advisory Council has finally decided to support this Measure. In listening to the right hon. Gentleman the Member for Blyth (Mr. Robens) I was a little concerned to know whether or not he intended to support it. I had read his comments in the previous debate, and had gathered that he was in favour, after all, of payment by cheque. He and others representing the trade union movement should remember that this is a permissive Measure.
Because it is a permissive Measure it must also be a persuasive Measure. We believe, as does the right hon. Gentleman, that no worker should be paid by cheque who wants to be paid in cash. I go with him when he says that men should not be made to do that, even though they are ill or working away. Equally, nobody should be made to be paid in cash who wishes to be paid by cheque. I hope that in this matter the rights of the individual will be maintained. It is so easy for the head office of a trade union to try to impose a decision; just as easy as it is—and we have heard quite a bit about this from the other side—for an employer to try to arrange things.
At the Trades Union Congress—I think last year—Sir Thomas Williamson made rather an interesting comment which I should like to quote. Talking about payment by cheque he said:We shall, of course, insist that in any establishment organised labour through the appropriate unions shall have negotiations and consultations as to whether or not, in the first place, this system shall be introduced at all.I hope that there will not be any interference from the top with the worker who wants to be paid by cheque.
It is interesting to note that in this Bill we are to have, at the request of the trade unions, the principle of contracting in. That is an interesting deviation from what exists in other directions where we have the principle of contracting out. Consultation between managements and trade unions there must be on this question, but it must be at a workshop floor level between local managements and the local men whom they know.
434 A great deal has been said about the great scope that this Measure will give to the banks. I do not want to pursue that subject—it has been mentioned by many hon. Members—but I am sure that my right hon. Friend the Chancellor of the Exchequer would agree that if he could have a very small increase in savings by a very large number of people who suddenly started to pay into the banks he would find the below-the-line situation in his Budget considerably improved.
My right hon. Friend will have to look very carefully at the position of the trustee savings banks. Many workers are accustomed to using those banks, and in order to encourage them to take full advantage of the provisions of this Bill, the regulations governing trustee savings banks may have to be changed. For example, they cannot at present issue cheques. This might be looked at.
I am sorry that when the right hon. Gentleman the Member for Blyth referred to the Post Office Savings Bank he was mistaken in the amount that can now be withdrawn on demand. He has probably forgotten that since the Conservatives have been in office there has been a great increase in the standard of living of the ordinary worker, who is now getting much more money these days. It is true that when the party opposite was in power one could withdraw only £3 on demand from the Post Office, but the amount is now £10. However, the Chancellor of the Exchequer may have to look at this again, because even £10 is not enough. A worker's wages may be between £10 and £15, or even £20 a week. He cannot draw out until he puts in, and he would presumably want to take out a very large proportion of his wages.
I am pleased at the prospect of more people taking their wages by cheque, as I think that it will create considerable social change. This Bill has been described today as a modest Measure. That is true, but it may represent that cloud no bigger than a man's hand in the sky telling of many changes that are to come—small things that eventually will gather momentum.
The office worker and the manual worker have for so long had a division between them. There is a quite useless 435 and unnecessary snobbery that exists here. The office worker on a machine is paid by cheque; the factory worker on a machine is paid in cash. The office worker gets the impression that there is something to his great advantage in this. Then, from this there flows a whole rigmarole of divisions and differences—lying-on time for the manual worker but not for the office worker, holidays after six months for the office worker, but not for the manual worker; overalls provided for the one but not for the other; and contracts of service for the one and not for the other. Many of these artificial barriers will begin to go when this Bill becomes an Act, and it is time they did.
Apart from containing many industrial workers, my constituency also has many farming people in the villages. It has been said that they will have great difficulty in being able to cash their cheques, and my right hon. Friend the Minister of Labour, in his opening speech, said something about the difficulties of communication in the countryside a hundred or so years ago. These difficulties of communication in the countryside are becoming very bad today; and if British Railways go on closing more lines, they will get even worse. When this Bill is passed, not only will the banks have to improve their services in the countryside but so will the transport undertakings, and I hope that this Measure will encourage them to do so.
Finally, I think the Government have shown a very nice sense of timing in bringing forward this Bill. Perhaps they think—I do not know—that there is a great danger that, with the introduction of betting shops, the worker will be in danger of putting all his wages on a runner in the 2.30 next day. Therefore, they have produced this Bill so that he can be paid by cheque. The worker will then be in no danger of getting into trouble when he goes home for having deposited his wages in the wrong direction.
In the near future, we may see the manual worker and the office worker together going into the banks and depositing their wages, and then, perhaps, going into the betting shop and laying their bets. Moderation in both must be to 436 the social good. If such moderation in both is achieved and if people in our affluent industrial areas help the Chancellor of the Exchequer to save While helping the Home Secretary to work out his Betting and Gaming Bill, I think that both the Government will be glad to have brought in this Bill and my hon. Friend the Member for Crosby (Mr. Page), who first inspired it, will be glad that he has been successful.
§ 6.34 p.m.
§ Mr. Jack Jones (Rotherham)
It falls to my lot to congratulate the hon. Member for Rutland and Stamford (Mr. K. Lewis) on making a speech which we on this side of the House could quite easily pull to pieces if we so desired. When we come to the more controversial Bills, most of us will hope that we shall hear from the hon. Gentleman again, so that we can take up some of the points he mentioned and remind him of some of the things to which he has referred today.
This Bill is not controversial. Those of us on this side of the House do not wish to say, here and now, that workers should not be paid by cheque. It is a happy thought that they are to be paid as workers, and that the vast majority will be able to be paid as they wish to be paid, either by cheque or in cash. It is a very happy thought that some people are afraid that there will be queues at the banks. Most of us used to be afraid of the queues at the employment exchanges. This is a sign of the times, and an indication of the progress that has been made since the first inception of full employment in this country.
In essence, the Bill comes down to a question whether it shall become compulsory for workers to be paid by cheque or at their option. That was the major point made by my right hon. Friend the Member for Blyth (Mr. Robens), and I want to follow it up. I happen to be the welfare supervisor of a rather large organisation, and I often see workers being paid out on Thursdays. I have not seen them today, because I have to be here, but during Recesses and on other days I watch what happens when the people are receiving their pay.
I am glad to think that we have arrived at a time when the worker will be able to put his cheque in his pocket, or have the money deposited in a bank by the firm, and he or his wife can go along at 437 their leisure and draw money out as they want it. It gives the worker an added sense of the status which has been denied to him for far too long. I would disagree with any of my colleagues on this side of the House who might say that there is no such thing as pride in the possession of a cheque book. I am certain that there is.
Furthermore, the question has been raised of wives getting to know how much their husbands are getting in their pay packets. They do get to know, but they only have a look at the pay packet when it is for a short week. It is very seldom that they see the pay packets on which are marked the overtime, the bonuses or any signs of the magnanimity which the firm might have been showing to the highest possible point. That, however, is beside the point and a digression.
The Bill has good intentions, and that is my candid opinion, but it also has its snags. For instance, we get the situation of an organisation with about 4,000 employees—and I am speaking of a case best known to me which I am best able to describe—in which 3,000 people may opt to have their wages placed directly into the banks or, alternatively, to be paid by cheque, whereas the other 1,000 may want to be paid in cash.
The big firms will have to decide whether to seek, legitimately, and without using unnecessary pressure on the workers, to prevail upon the remaining 1,000 to agree to be paid by cheque, because it is more convenient to them to do so. It would prevent the division of the staff and the employment of extra staff to deal with two methods of payment, one by cheque and one in cash.
We might get an awkward situation, in which, as has been said, we might have to change the pattern of the pay cards, the metal blocks, the offsets for hospital fund, savings association and National Health contributions. All these things are snags, but I think that they can be overcome. I am absolutely certain that if the provisions of the Bill are zealously carried out, it can be a good thing.
On the other hand, if that did not happen, it could be a bad thing. We might get the awkward few—I have had sole experience of the awkward few in industry—who, because of the apathy of the decent many, can kick up a hell 438 of a row and create a lot of unnecessary trouble. The awkward few might decide to opt out, and go along to the branch meeting, at which the apathy of the good folk is displayed by their absence, and might pass resolutions with regard to the method of future payments.
There are those on this side of the House who know that the awkward few can become very awkward indeed, just as in the same way the awkward boss, the old die-hard type, if he wishes, can also become very awkward and seek to apply pressure to get one system wholly in operation—either that of payment by cheque or that of cash payments.
The Bill will, I know, have its practical difficulties. There never was a Bill presented to the House—please God, there never will be—which did not have in it practical or technical difficulties of implementation. It is in the implementation of the Bill that its merits or demerits will appear.
Good, modern managements do not need to be told that their employees would like to be paid by cheque. Most modern managements understand that, and, indeed, most enlightened, ordinary workpeople today have acquired that sense of dignity and responsibility which makes any suggestion that the ownership of a cheque book is something foreign to them or, as it were, a cause of anxiety quite outmoded. Those few people who do not know how to use a cheque book can very soon be taught.
It will be easy for modern managements to set up, contiguous with the firm concerned, places where cheques can be cashed. It will not be easy to do the work, but the actual arrangements should not present any great difficulty. Practical difficulties will arise, for instance, in this way. Many firms, such as my own, pay their people at 1 o'clock or half-past 12. There are the men on from 6 to 2, and they are paid at 2 o'clock. There are the men who come on duty at 2 o'clock, on from 2 to 10, but they may not wish to have their wages at 2 o'clock because they fear that they will lose them in the course of their work. They may want to be paid at 10. The people who work from 10 till 6 will not want to keep their wages until they go off at 6 but would rather take them in the morning. Those are 439 some of the practical difficulties which may present themselves.
It has been rightly said that our present branch banks are not constructed to deal with a mass of workpeople paid by cheque. The banks in the constituency of the hon. Member for Rutland and Stamford were built not so much for the farm labourer but for the farmer, and, moreover, not so much for the farmer going into draw out what he had but for the farmer going in to talk about how much more he could borrow. Let us have these things right. It is a very happy thought that, at long last, the farm labourer in his fustian will be able to walk into the bank in the hon. Gentleman's constituency and look the manager in the face, taking out what he wishes from what he has there, knowing that his boss, forsooth, has not had in the bank what he as been taking out for a long time. In other words, the boss is "in the red", but the farm labourer is not. Hon. Members opposite may smile, but they know that is the truth.
§ Mr. Jones
Of course, the worker will be the better bet because the requirements of the farmer to get the last pennyworth out of his stock and foodstuffs on his land are not the same as the requirements of the labourer who is called upon to do the work. I say quite seriously that it is pleasant now to think that the farm labourer can, if he wishes, go confidently into the bank. He can even drive up in his own car, if that is his desire, and, what is more, if he has a car, he will know that he has paid for it, unlike his boss. However, I will leave that there. Some hon. Members opposite will know more about that than I do.
We need not be alarmed about the Bill. I understand, as my right hon. Friend the Member for Blyth knows, that when the matter was discussed forebodings were expressed by the Trades Union Congress representatives on the National Joint Advisory Council. That is as it should be. It is the trade unionist's job to point out the snags. It is the job of the bankers and the Government representatives to point out the benefits. I hope that, as a result of our discussion and our ventilation of certain 440 practical points, we shall in the end have a Bill which, in its implementation, will give an added sense of dignity and security to the workers, enabling people to use a cheque book as long as they are able to use it, without being "in the red."
§ 6.44 p.m.
§ Mr. Martin McLaren (Bristol, North-West)
I, too, stand much in need of the kindness which the House generously gives to those who address it for the first time. On a personal note, perhaps I may be allowed to recall that my father's arms are on one of the walls of this House, and I represent the fourth generation to serve here.
I come here from the City of Bristol. We were made a separate county in the reign of King Edward III, about whom we heard only two days ago. We have sent here from Bristol many eminent men, from Edmund Burke in the eighteenth century to Sir Stafford Cripps and Colonel Oliver Stanley in our own day.
This Bill will greatly interest people in the City of Bristol, because Bristol was one of the pioneers in the trustee savings bank movement, and the trustee savings banks may well be affected by its provisions. There are in Bristol many people earning good amounts who, I am sure, would like to avail themselves of the opportunity to receive their wages in forms other than cash. I was very glad to hear the hon. Member for Rotherham (Mr. Jack Jones) say the same; he knows many people in his constituency who would wish to hold bank accounts.
The need for the Bill arises from the higher wages which, happily, are being paid today. Hon. Members in all parts of the House will probably agree that, at any time up to 1939, weekly wage earners were paid far too little. The average wage then was, perhaps, no more than £3 a week. In those days, there was no question at all of people wanting to be paid their wages other than in cash. They needed the cash at once so that they could turn it into the necessaries of life as quickly as they possibly could. Those were the days when pawnbrokers flourished much more than they do now, when people used to take their Sunday suits to the pawnbroker on Thursday and redeem them on the Saturday.
Happily, those days are gone. Today the average wage is about £13 a week. 441 I know that that means that there are many who receive much less than £13 a week, but there are many who receive a good deal more. The £20-a-week man is quite common I was reading the other day about a foreman steel erector who was called by his friends the "£100-a-week foreman."
It is surely possible now for people to establish a reserve of savings out of their wages, to have an account in a bank or elsewhere, and to give an order that their earnings should be transferred regularly into that account. I should not like it to be thought that, in speaking of the higher earnings which prevail today, I am satisfied with the level of earnings which many people have. Many are still far from well off, but I hope that their earnings will rise as the productiveness of their work increases.
As we move towards a classless society, what we want to do, surely, is to equalise—if I may put it in this way—the position of the £20-a-week man and the position of the £1,000-a-year man. As my hon. Friend the Member for Rutland and Stamford (Mr. K. Lewis) said, we should reduce the distinction between those who are counted as staff and those who are not. The method of payment is one of the points of distinction, and this the Bill can make disappear. I hope, as my hon. Friend does, that, along with the disappearance of that distinction, we shall witness the disappearance of other distinctions in treatment during sickness, hours of work, and so forth.
The Bill will help savings. From every-day life we all know that money in the pocket is almost as good as gone, but some people still have a kind of puritanical scruple against taking money on of a bank account. I am sure that the Bill will encourage many more people to have banking accounts. One convenience which I am sure that they will find is that they will make their periodical payments in respect of electricity, gas or the telephone by cheque and they will find that they will effect great savings in time and trouble compared with the method of putting coins in to a meter or making a journey personally to hand cash over the counter.
I read the other day that in the United Slates of America no less than 80 per cent. of the families use banking accounts, whereas here the figure is no 442 more than 30 per cent., which shows, I think, that we have plenty of leeway to make up and that there is plenty of scope for more extensive use of our banks. I agree, as other hon. Members have said, that this may mean that the banks will have to change their hours, but I also feel sure that they will welcome that opportunity.
No one expects any striking changes from the Bill overnight, but we do expect a slow and steady progress towards a state of affairs where people will stand more firmly on their own feet in the knowledge that they have something put by, which will give them more independence, security and happiness. I think that another advantage which will flow from the Bill is that there will be a saving of the time spent in moving coins and notes to places of employment, to say nothing of the discouragement of the smash and grab criminal.
The really agreeable feature of the Bill is that no one is to be compelled to do anything which he does not want to do. Many of us would wish that feature to be included in many other Bills. I was struck by the point of my right hon. Friend the Minister that the misgivings of some shopkeepers may he found to be misplaced, because the man who wants to turn his wages quickly into cash need never depart from the present method by which he receives cash from his employers. I can foresee the time when people will be paid at rather longer intervals of time. In the same way as the council house tenant today pays his rent fortnightly in many cases instead of weekly, I think that people may request that their wages should be paid fortnightly or even monthly directly into accounts in their own names.
Some people have said that the keynote of the work of our present Parliament is that we should bring up to date parts of the fabric of our social legislation to accord more closely with the needs of our time. I believe that the social historians of the future may regard this Bill as a notable and significant example of that work.
§ 6.55 p.m.
§ Mr. Dan Jones (Burnley)
I oppose the Bill, but, before giving my reasons for so doing, may I take upon myself the pleasure of congratulating the hon. 443 Member for Bristol, North-West (Mr. McLaren) on a commendable maiden speech. I know that he will probably feel that he could have done much better, and that he ought to have done much better, but he can accept my assurance that, having spoken, as I have done, in all manner of places, this is not the easiest place in which to feel comfortable. The hon. Member has done quite well.
Throughout the years, I have spoken to hundreds of thousands of workpeople, and I have never once been asked to advocate or support an alleged reform of this kind. I therefore object to the statement that the Bill is intended primarily for the benefit of working-class people. I do not agree with that. I think that I have the right to object to the inference of the Minister that the Bill has the tacit approval of the T.U.C. It is a known fact that the T.U.C. neither approves nor disapproves of it, and I feel that that should be said. I am certain that if the T.U.C. conducted a plebiscite of trade unionists there would be an overwhelming vote against it.
I agree with my right hon. Friend the Member for Blyth (Mr. Robens) in that if there were necessary industrial reforms for workers he could suggest many which would be infinitely more preferable to the Bill now before the House. Has the Minister thought what is likely to be the situation in industry if it were possible for some people to opt for the cheque scheme and for other people to opt out of it? When all is said and done, that is a likely possibility. It may be that a company would have to have two separate departments, one for dealing with payment by cheque and the other for dealing with payment by cash in the normal way. I suggest that that would not be economic.
Furthermore, are we entitled to thrust this change upon industry, which is already changing? Let us be clear about what we are doing. Tremendous changes are taking place in industry. Time and motion study has been extended not only to those who actually produce, but to indirect workers as well. In some instances there is little doubt that these changes are not welcome and we are therefore thrusting change upon change. I do not think that this is 444 wise. Also, we are asking workers who agree to the cheque scheme to travel to a bank after having done a week's work, and that will involve additional cost. Are we not deliberately bringing about a situation where, as a result of the additional cost factor, there will be further applications for wage increases to meet it? That is quite possible.
Those are some of the reasons why I feel that I could not support the Bill, not only in its present form, but even if amended. Many reasons have been advanced which I made up my mind to dwell upon, but I shall not bore the House with repetition. Unfortunately, when one comes in late that is a disadvantage which one suffers. Why are the Government, having set up the Karmel Committee to analyse and report upon the Truck Acts, now pressing the Bill forward at this time? Do you not think, Mr. Minister, that the time of the House could be much better employed on other things and, in so doing, pay particular deference to a body which your own Government have set up?
§ Mr. Speaker
The hon. Member must address the Chair. He must not address his observations to individual Ministers or Members.
§ 7.0 p.m.
§ Mr. R. Gresham Cooke (Twickenham)
I am not altogether surprised to hear from the hon. Member for Burnley (Mr. D. Jones) that a great many workers are against this scheme, for the reason that they do not understand what is involved, as I hope to explain. I was, however, surprised to hear from the right hon. Member for Blyth (Mr. Robens) that all the workers' organisations do not want it.
§ Mr. Robens
I did not say that. I said that no trade unions had asked for it, which is quite different from saying that no workers want it.
§ Mr. Gresham Cooke
—none has asked for it—first, because the experience of Imperial Chemical Industries shows that a number of workers are glad that such a scheme has been brought into effect, but, secondly, because those who oppose the scheme show themselves to be very shortsighted. I believe that the introduction of the Bill and of payment by banker's credit will be a step forward in humanising industry, as the hon. Member for Rotherham (Mr. Jack Jones) probably has in mind, also.
Many of us on this side of the House, and enlightened employers, are beginning to see that there is too big a gap between the man at the bench and the staff man. I agree with those who say that a man should no longer be subject to a week's notice.
§ Mr. Gresham Cooke
Many of us have been saying it for a long time.
When the Bill comes into force and the man at the furnace or bench is paid by cheque, the staff and operatives will be brought closer together by that fact. Not only will industry be humanised, but the worker will come to realise that there is some glamour in being paid in the same way as a director of his company, or as a Member of Parliament, or any other high person. This, therefore, is a step forward by which we are bringing all the people in the enterprise together.
The reason why there has been misunderstanding about the Bill—it has been shown widely on both sides today—is the use of the phrase "payment by cheque". I do not believe that payment by cheque will necessarily follow. What will happen is that an employer each week will pay a certain sum of money to the bank. He will send with it a list of his employees and their banks to which the individual amounts should be paid. Therefore, rightly, the Bill will result in payment by banker's credit and that is how it should properly be known.
I hope, therefore, that it might be possible to amend the last sentence of the Explanatory Memorandum, which states: 446The rest of the Bill is to come into operation after the expiration of six months (Clause 9) except that before the provision permitting wages to be paid by cheque comes into force an order of the Minister of Labour is necessary.It should be amended, if possible, to refer to the payment of wages by banker's credit, because that is what will happen. We can allay the fears of shopkeepers, grocers and publicans that people will be handed bits of paper at the works gate which operatives might lose and then have to go to the public house to cash their cheques, because I do not believe that that will happen.
§ Mr. John McKay (Wallsend)
Is it not correct to say that whatever method is adopted to give the workman his dues, if he is paid by cheque he must get the cheque from the employer? Then, he will have to go to the bank. So that instead of getting his money with one effort, as now, in cash, if he is paid by cheque he must make two efforts and get into two queues?
§ Mr. Gresham Cooke
I am suggesting that the great majority of workers will be paid not by cheque, but by banker's credit, which goes direct to the bank. Then, as often happens at present, the employee will give to the bank a standing order to pay his wife so much housekeeping money and it is his wife who would have to go to the bank in the town when she does her shopping on a Thursday or Friday to collect her weekly housekeeping direct from the bank. That is how it is likely to work in practice.
The Wages Bill introduced by my hon. Friend the Member for Crosby (Mr. Page) contained a Clause permitting employers, with the permission of an employee, to pay wages to the nearest 10s. That was a useful Clause, because it meant that less cash would be carried about through the streets and it made the wages operation much easier. I should like that Clause to be brought into the present Bill.
I was once connected with United Steel, one of whose branches made the effort, with a certain amount of agreement, to pay to the nearest 10s. At the end of the year, of course, here is always a small balance one way or the other and any adjusting is done at the end of the year. Broadly, however, by the end of 447 the year the worker has been paid within a few shillings of the total a mount due to him.
I read the other day some remarks by the hon. Member for Grimsby (Mr. Crosland), in which he said that we are becoming more prosperous every day, that the upper ranks of the working class are entering the middle classes and that the prosperity we are enjoying was not "phoney" but was real. I believe that to be entirely true. I regard the Bill as a big social step forward in every way and one that will more closely unite the people in industry and in the nation. For that reason, it is to be highly commended.
§ 7.7 p.m.
§ Mr. John McKay (Wallsend)
I was surprised at the last of the sentiments expressed by the hon. Member for Twickenham (Mr. Gresham Cooke). I see nothing in the Bill to unite the nation. I cannot see how the nation can be united unless it is united within the general body of wage earners. There is nothing in the Bill to encourage or delight, or create any enthusiasm among, the ordinary workers in the engineering shops or in the pits.
What is there for the worker to get enthusiastic about? At the end of his week's work, he goes to the office of payment, usually at his place of work, and gets his money. There is nothing more to bother about. Under the Bill, however, if he voluntarily changes from that method, he will place a penalty upon himself in many ways. There is, for example, the penalty of inconvenience. For the majority of workers, it is much more convenient to get the money at the workshop than through a bank, however convenient one tries to make this method appear. That is why the Bill is out of place and there is no logic in the suggestion that it will unite the nation.
There is no great enthusiasm in the country for the Bill. There is no great opposition either. That is evident from the attendance here this afternoon. The fact that there is no great opposition does not mean that there is, therefore, great unanimity and enthusiasm about the Bill, because there is not. The explanation of the lack of opposition is the tremendous amount of indifference among the mass of the workers. The Bill is of no 448 advantage whatever to them. It is an accepted fact that it is the banking community and employers in general who are pushing the Bill. There is no force for it among the working people. Therefore, I cannot see how there will be any greater unification among the nation than there is today.
I wish, however, to congratulate the Minister. He explained the Bill very well, however indifferent we may feel about it, and I do not think it could have been done better. I am full of congratulations today. That is rather remarkable, because usually I do not go out of my way to congratulate people. I think, however, that the speech of the Minister, in explaining the Bill, was very good indeed, and that my right hon. Friend the Member for Blyth (Mr. Robens) also made a very clever speech upon a very dry subject. With the help of the Minister we have been given a very full point of view upon this whole situation. It might be thought that there was nothing more to be said after the two chief speakers had ended their speeches today.
In fact, this is a very peaceful occasion. It is one of the most peaceful House of Commons days that I have seen for a long time. This Session was supposed to see the beginning of a fight by the Labour Party. Today, we have been shaking hands before the battle begins. I hope that no one will be deceived by the peaceful position in which we find ourselves. It is not a token of the future at all—so beware.
When I began to think about political matters, I was told that law should always be based on the general will—the feeling prevailing in the country—and that it generally had, as we progressed intelligently, a moral basis. There is no morality about this Bill. The reason that we have such a tremendous amount of indifference about it is that already a large part of the community is paid by cheque. Those people have nothing to bother about. The indifference shown by the rest of the community is that people do not want it particularly but they have no great objection to it. Why? It is generally understood that in so far as we can meet a section of the community in regard to any particular matter, and give people opportunities which they did 449 not have before without doing any harm to the rest of the community, we are to that extent developing more freedom within the country itself. This may be a small matter. It may give a little more opportunity of freedom to the employer and greater opportunity for business to the banker, and therefore create a little more freedom in that respect; but freedom which has no great substantial result does not amount to very much.
The whole Bill, as it is, is not of much importance. That is why there is such a small attendance in the Chamber today. That is why the trade union movement has not bothered itself much about it. The trade union movement knows perfectly well that the mass of wage earners will prefer to take their money as at present at the workshop, and get it quickly without any question of having to go to banks or grocers' shops or public houses.
To my mind, if people get paid by cheque they will not want to go to the banks. There will be a tendency to go to the grocer's shop. The grocer will have the commission if the worker takes his cheque to the grocer's shop to be cashed, and the bank will have the commission for its work. The bank wants a commission for anything that it does. The same applies to this Bill and all its consequences. One can go to the bank or the publican or the grocer to get one's cheque cashed, but all those parties want a commission. Ultimately, if the wage earners in mass take advantage of the opportunity to be paid by cheque and go to the public houses and shops instead of to the banks to get their money, this will have a bad effect, as some people have already pointed out.
It may be that in the middle of the week some of these people will go to a shopkeeper and say, "All my money is spent; can you give me a sub? "It may be that we shall get more and more men going into public houses with cheques in their pockets and that many of them will arrive home with nothing like their full wages. It is true that they may not have told their wives how much they earn, but perhaps the less we say about that, the better, because it is not a very nice subject to discuss. Some people think that there is no objection to, the practice, but personally I object to it very much. There is no great 450 morality about marrying a woman and then deceiving her about the amount of money available to keep the house going.
In fact, this is a very small matter and of little interest to the mass of workers. I am sure that most of the ordinary wage earners will not have anything to do with it. If the banks and employers are expecting a mass movement by people to be paid by cheque, I think that their hopes will not be fulfilled.
I conclude by saying that this is a quiet afternoon, there is no opposition and there is a great amount of indifference to the Bill in the country; and we might as well get it through as quickly as possible if we can ensure the safeguards which my right hon. Friend the Member for Blyth mentioned this afternoon.
§ 7.17 p.m.
§ Mr. Ray Mawby (Totnes)
I welcome the Bill for what it seeks to do. The only reason for the Bill, I believe, is to enable payment by cheque to those who desire to be paid by means other than cash. That is what the Bill seeks to do. This is very well-proved when one looks at Clause 6 (7). There is a proviso there which is very closely drafted. Nevertheless, in Committee we shall have an opportunity of looking at it even more closely.
Subsection (7) says:Nothing in this Act shall operate so as to enable an employed person to be required, by the terms or conditions of his employment or otherwise …I think that that is putting the point very clearly indeed—that, in fact, it must be a voluntary requirement of the employee himself or herself before payment can he made by the employer in other than cash.
It is important that this provision should be in the Bill. Before I came to the House I received my wages in cash and, therefore, I know full well the habits which have grown up over the centuries in the matter of payment of wages. My right hon. Friend pointed out some of the problems which gave rise to the need for the Truck Acts in the first place, when all kinds of dodges were operated by employers to make certain that they not only paid the 451 lowest possible wages, but paid them in kind, so that the employers received extra advantage as well.
I believe that the Bill, even without Clause 6 (7), would operate without danger to those employed in the larger industries where in the main there are strong employee organisations and the trade unions have working arrangements with employers and would expect consultation. They would want to know the terms upon which the arrangements were made before they would accept that employees should be paid other than in cash.
Many arguments have been put forward against this whole idea from the point of view of its effect on rural workers. There is the man who works for an employer who employs only two or three people, the man who works on a farm or is employed at the local dairy and, therefore, does not have the advantage of this procedure of negotiation through his union with his employer. He usually lives a number of miles from the nearest town where there is a bank at which he can cash his cheque. These people are, naturally, very concerned to see that they should not be forced by their employers to accept pay other than by cash, because such payment would cause them and their wives great difficulty in changing cheques, money orders, and postal orders into cash before they went shopping. But the Bill, particularly with the safety Clause, will enable payments to be made in this way in factories where agreement has been reached after consultation. I believe, however, that in the consultations which take place all sorts of matters may well be raised.
§ Mr. Mawby
Provision for consultation is not made in the Bill as such. It is not written into it, but I thought that I made it obvious in my earlier remarks that in the larger firms normal consultation machinery is already in being, in the form of a works council or a joint production advisory committee, and similar bodies. I should have thought that any employer who thought to try to implement payment of wages by cheque would be extremely sensible to raise the matter first at whatever point he 452 negotiates with representatives of the workers.
§ Mr. Robens
I agree wholeheartedly with the hon. Member in that, but does that mean that he would support an Amendment in Committee to provide for its being written into the Bill?
§ Mr. Mawby
I believe it to be very important that there should be consultation. Naturally, I cannot commit myself without seeing the Amendment, but I certainly stand by what I have said.
It is certainly no good at all a firm offering this system and circulating all its employees to ask whether they would want to be paid by cheque and then, after a great deal of trouble, finding that 75 per cent. of them, because they do not know what it is all about, say that they do not want it. I should have thought that any sensible management would make certain that feelers were sent out to find out the attitude of the employers towards any new system of payment.
A number of things would have to be discussed. I believe that the first would be the general attitude towards a bank of the average man who is paid in cash. He is extremely suspicious at the moment of the ordinary bank. The average man, if he happens to come up on the pools or in any other way receives a cheque, will very often go along to the friendly grocer's shop down the street, or to his nearest "local" and try to cash the cheque there rather than go into a bank. That is the attitude of a large number of people.
Secondly, banks have not been designed to fit into the present-day situation. Normally, they are situated in the centre of a town where commerce is carried out. The housing estates are generally some distance away from the banks. Therefore, many people will say that banks are things with which they do not want a great deal to do. The only difficulty with cashing a cheque in a public house is that, in my part of the country at any rate, many of them display notices which say:We have an arrangement with the banks. They agree not to sell beer and we agree not to cash cheques.That is one of the problems which we shall have to face. Therefore, there will have to be adjustments.
453 In the first instance, banks will have to be prepared to open branch offices, at what they would call abnormal hours, somewhere near the factories. I believe that it would pay the banks so to do and to make certain that those who are paid their wages by cheque have the opportunity to visit them. There will also be the difficulty of the transition from the process of drawing wages week by week to the situation of having a bank account.
§ Mr. Jack Jones
Surely the hon. Member is assuming that those who opted to be paid by cheque would go to the trouble to go to the pay office to collect the cheque and then pay it into a bank. I and I think most of my hon. Friends, have quite a different system in mind The worker would opt to have the amount of money due to him paid direct into his account at the bank and on the day he received his pay card he would he shown a slip stating, "You have been credited with the following amount at such and such a bank."
The worker would then have no need to go out in the middle of the day, perhaps after a night shift, to take his cheque to the bank. He would be able to make out a cheque to his wife and she would go and draw the money when it was needed. That is the system which will apply to those who wish to be paid by cheque. The hon. Member also seemed to assume that if 25 per cent. of the workers at a factory opted to be paid by cheque they could not be so paid if the remaining 75 per cent opted to be paid in cash. I believe, however, that if only 20 per cent. opted to be paid by cheque they could be so paid and the remaining 80 per cent. still continue to draw their wages in cash.
§ Mr. Mawby
I quite agree. The ideal at which we should aim is a situation where the majority of men who are now wage-earners will accept that on pay-day their employer will pay into their account whatever is due to them and that, from time to time, they will be able to make out the necessary cheques to pay their wives and even, moving further, to pay their grocers' bills. What I am thinking about, however, are the problems which will arise in the transition period between the process of drawing wages on Fridays in cash and the point where workmen generally are the proud owners 454 of a bank account and a cheque book. I am trying to suggest ways of bridging the gap.
I agree that even if only 10 per cent. of the workers want to be paid by cheque some arrangements should be made to see that they are given that service. In modern industry an employer would probably say that if only a small percentage opted to have its wages paid by cheque it would not be worth his while to have two separate systems. On the other hand, he might have sufficient confidence in the future attitude of his employees to start the scheme and hope that other employees would come in afterwards.
§ Mr. Jack Jones
I can assure the hon. Member that modern industrialists go to the length even of allowing one, two, three or four men to have their housing mortgages paid direct from their firms, to save them trouble, and from the possibility of not having the necessary money at the end of the month. Modern industrialists are prepared to do this. I can give chapter and verse.
§ Mr. McKay
Let us suppose that all the workmen employed by a firm agree to receive their wages by cheque. The hon. Member will admit that the bank wants some payment for the job it does, and will charge some commission. Who will pay that commission? Will the employer do so, or will a certain amount have to come out of the wages of the workers? If a man receives about £700 a year, how much will have to be deducted in this respect?
§ Mr. Mawby
The hon. Member is getting a little ahead of me. I had intended to raise the question of what the banks must be prepared to do in the future. Many people are suspicious of banks, and believe that whatever money they put in they will get much less when they want to draw it out. They believe that in some subtle fashion the bank will obtain its pound of flesh, and many of them quote the balance sheets of the banks to prove it.
455 If a firm finds that most of its employees are prepared to accept their wages other than in cash it will save a considerable amount of money. The firm will certainly be able to put those employees who are engaged in counting silver and coppers into bags on to more productive work. I do not see why the money which a firm saves in this way should not be used to ensure that any bank charges in respect of wages paid to employees by cheque are covered by the employer. That should reduce the suspicion of banks which some employees feel.
But if the employee opens an account and has his wages paid into it he must be responsible for any charges made in respect of services which he requires from the bank when he makes out his cheques to the butcher, the baker and the candlestick maker. There must be a new approach to this subject on the part of banks, employers and employees.
The right hon. Member for Blyth (Mr. Robens) objected to the proposal that money other than in cash should be sent home to a man who was away sick, or on the business of his firm. He said that this was violating the liberty of the individual, and that money should never be sent in that way unless the employer gave permission. But many documents which can be considered confidential are sent through the post, and there is always the possibility of a man's wife seeing them. No man can hope to bamboozle his wife on the subject of the amount of money he receives each week if his wife can open the envelope containing his Income Tax return at the end of the year. A man will be wrong in thinking that he could get away with it, because Income Tax documents are regularly delivered to households and there is no reason why the envelopes containing them should not be opened by any member of a man's family. I cannot see that any fresh problem is created in that respect.
§ Mr. Marsh
The point about a man's letters being opened was only one of those which have been raised. The basic problem arises when a man signifies that he does not wish to receive his pay in anything except cash. He has that right under the Bill and yet, notwithstanding his statement to that effect, in certain circumstances his employer can still send his pay in a form other than cash.
§ Mr. Mawby
Yes. We can deal with that point in Committee. I was trying to deal with the question of sending to a man's home something which he wished to remain confidential, when it could be seen by his wife.
As I said at the beginning of my speech, this is not a world-shattering Bill. It is a permissive Bill. It enables those who desire to make changes to do so. I believe that its safeguards are such that it will ensure that only those who wish to change will have to do so. If the Bill is used over a period of years I believe that more and more people will begin to build up a bank balance, even if it is only to provide a better annual holiday, because they will find that it is a more efficient way of saving money. If it does only that it will be of great assistance to those employed in industry.
§ 7.39 p.m.
§ Mr. John Stonehouse (Wednesbury)
My hon. Friend the Member for Walls-end (Mr. McKay) said that there is no general enthusiasm for the Bill, and he is right. There is no general enthusiasm for it, because most people do not know that this idea of payment by cheque has even been suggested. But that is no reason why we should damn the Bill.
Many social and other advantages can be derived from it if it is put into effect in the right way, if employees are aware of their rights under it and of the advantages that they may derive from it, and if it is fully explained to them. It would be a great mistake if workers were pushed into accepting the provisions of the Bill by employers, who may, indeed, be acting from the best possible motives, in circumstances when the employees did not know their rights and protections, and the kind of facilities they could enjoy from taking advantage of being able to receive payment by cheque.
I agree that it would be ridiculous if, having agreed to be paid by cheque, an employee walked to the bank and took out all the money in cash. That would be of no advantage to him or anybody else. The real advantage will come if employees open bank accounts and use them to pay their monthly or weekly accounts—their rent, hire-purchase payments, and so on—and use all the facilities which banks can offer.
That brings me to the question of the efforts which employers will make to 457 persuade their employees to open bank accounts with certain banking firms. Employees will need some advice and protection in this matter. In some cases an agreement may be arrived at between a bank manager and the accountant of a firm whereby the bank undertakes to help with the accounting work of the firm provided the firm persuades its employees to use that bank. Then there is pressure upon the employees to use that bank. They will be helped to start a bank account provided they agree to bank at Bank A or Bank B.
If the individual is not aware of his rights under the Bill he will feel that he must bow to that sort of pressure, and it might not be to his advantage. He may find that, in respect of the charges it makes or the facilities it provides, the bank which he has been persuaded to use is not so good as he has been led to expect.
§ Mr. Stonehouse
I am obliged to the hon. Member for raising that point. I do not preclude it, but I want employees to be aware of their rights. Advantages may be derived from using the same bank as that used by one's employer, but there may be disadvantages, and the individual must be given a chance to weigh up the pros and cons of the case.
Then there is the question of banking facilities. Banking hours are absolutely antiquated. They are out of tune with the habits and customs of our people in 1960. If the Measure is to be used to any great extent when it becomes law there will have to be a change in banking hours. At present, only one bank provides the facilities which most workers would need if they were to take full advantage of the Bill, and that is the Co-operative Bank.
At this stage I should declare my interest, because I am an elected director of the biggest retail co-operative society in this country. As hon. Members are aware, it is through the in- 458 dividual branches of retail co-operative societies that the facilities of the Co-operative Wholesale Society Bank are available—and very helpful they are. At the moment that is the only bank which can provide facilities over the stretch of the day from 9 a.m. or 9.30 a.m. to 5 p.m. or 5.30 p.m. I hope that other banks wil make similar facilities available. If they do not, there will be no real advantage in implementing the provisions of the Bill.
Some hon. Members have mentioned that wives will be able to cash cheques, but in many areas wives, too, go to work and are not able to cash cheques during the middle of the day. They may be able to get cash for the week's shopping only on Saturday mornings. Anyone who has been shopping on Saturday morning knows that the shops are already crammed full with busy housewives who work during the week. What will be the position in the banks if those housewives have to cash their cheques on Saturday mornings before doing the shopping? There will be chaos unless facilities are made available at other times during the week.
The main advantage of the Bill will come if people understand what it is about and what facilities are available under it. That brings me to the subject which I was very glad to hear the hon. Member for Totnes (Mr. Mawby) raise, that of consultation. It is not sufficient for employers to have consultations with individuals. Employers should consult trade union representatives and take them completely into their confidence and discuss the whole issue with them, even if implementation has to be delayed for three months, six months, or a year. Employers must get the confidence of the trade union representatives and the shop stewards, so that these provisions can be implemented in a way which will bring maximum agreement between workers and employers.
It would be a great mistake if workers in particular grades were picked out and if those were the workers who got the cheques while other workers were left out, either because they did not understand what was going on, or because they believed that those chosen were the "blue eyed boys" of the management. I hope that the Government will propose Amendments in Committee to 459 make it incumbent on employers to consult trade union representatives or shop stewards to get the maximum co-operation between employers and workers' representatives before the provisions of the Bill are used.
I now turn to the question of encashment. If a worker chooses to take a cheque and does not want to have a bank account, he should be entitled to have that cheque cashed in full if he chooses to take a cheque rather than cash to his wife on Friday or Thursday night, even if that means that the bank passes on the charge to the firm.
In a maiden speech, the last part of which I was very pleased to hear, the hon. Member for Bristol, North-West (Mr. McLaren) said that he hoped employees would take payments at intervals longer than a week. I hope that that will not happen. If workers are paid over too long a period, they tend to take too much on credit. It would be better if payments into bank accounts were made weekly.
Most people who will take advantage of the Bill make weekly payments—weekly rent and weekly housekeeping payments. Their lives revolve round weekly payments and it would be a mistake to try to force them to accept monthly or three-monthly payments to which they are not accustomed.
I repeat that it would be a mistake for the Bill to be passed without the various Amendments which have been suggested for improving it and without full provision for explaining it to workers so that they can fully understand the advantages arising from it.
§ 7.51 p.m.
§ Mr. R. E. Prentice (East Ham, North)
My first duty is the pleasant one of congratulating four hon. Members opposite on having made their maiden speeches this afternoon. I had the pleasure of hearing those of the hon. and gallant Member for The Hartlepools (Commander Kerans) and of the hon. Member for Wokingham (Mr. van Straubenzee) and although I was out of the Chamber when the hon. Member for Rutland and Stamford (Mr. K. Lewis) and the hon. Member for Bristol, North-West (Mr. McLaren) made their speeches, I have heard that they were equally successful.
460 Speaking of maiden speeches, I am, I suppose, one of a series of hon. Members on both sides of the House who in the last few months have been making what might be described as maiden speeches from the Dispatch Box. It is the tradition of the House to extend indulgence to a maiden speech in the real sense and I hope that I have detected a sort of semi-tradition to extend semi-indulgence to anyone in my position. I hope so, because I feel in some need of that sort of consideration.
The Bill has been received with somewhat mixed feelings and it would be fair to summarise the views of the Opposition as being that we see value in the Bill and regard some aspects of it as being socially useful and welcome, but at the same time we see dangers in the way in which the Bill can be misused if employers treat it in the wrong way and if they act against its spirit and letter.
I begin by emphasising at least two reasons why I welcome the Bill. I am sorry that my hon. Friend the Member for Wallsend (Mr. McKay) has left the Chamber, for I wanted to assure him that this was not a token for the future. He was afraid of the way some of us were supporting or sympathising with the object of the Bill. He need not regard this in any sense as a softening up of our Opposition tactics.
The Bill is good in two respects. The first is that it strikes a blow, however modest, at the artificial distinctions in industry between the manual and non-manual worker. One of the sources of snobbery and class distinction in industry and the country is the different attitudes taken towards manual workers on the one hand and so-called staff on the other, something which expresses itself in superannuation schemes, hours of work, holiday arrangements, eating in different canteens, in all kinds of things. Many of these items have no basis in legislation. In so far as the law upholds artificial distinctions of that sort, it is bad law. That is why we welcome the fact that the Committee is considering the Truck Acts with a view to bringing them up to date.
We say that while recognising that the need for the protection of the Truck Acts is still there, that workers still need protection against bad employers and that in the twentieth century there are 461 still the equivalent of the people who used to run the "Tommy shops". But the protection which is given should be twentieth and not nineteenth century protection. I go further than that and say that whatever protection is now needed is needed for all wage earners and that it is absurd to draw distinctions between, say, bus drivers and bus conductors, labourers and shop assistants, as the Truck Acts now do. Whatever protection is afforded by the new Truck Acts which will emerge ought to apply to wage earners and perhaps to salary earners as well, something which we must consider. It should apply to the protective provisions in the Bill.
That was one reason why I was very glad to hear my right hon. Friend the Member for Blyth (Mr. Robens) ask why this Measure was brought forward on its own and why we should not wait for a comprehensive Bill, which we could have I ad without too much delay, to bring the Truck Acts up to date in all respects. If we pass the Bill, as we shall, we shall logically he faced with the need to extend the protection of the Bill to other classes of worker.
If the manual worker is to be given a choice of having his wages by cheque, postal order or cash, clerical workers, shop assistants and other groups should hive the same choice. They should have the legal right to make a choice. At best the Bill is a sort of half-measure with useful aspects, but still only a half-measure and we shall need to go further in due course. I still welcome it in the sense that it takes away at least a little of the artificial distinction between manual workers and the rest.
My second reason for personally welcoming the Bill is that it will be of practical use to some individual workers. I agree with those who say that the demand will not be very large in the first instance. It has not been a vocal demand and there have not been any resolutions passed by unions representing manual workers asking for the Bill. Nevertheless, it is probably true that a small demand already exists and will grow.
We have to look forward and recognise that we are moving towards a more prosperous society. We have to think in terms of the 1960s and the 1970s—I cannot resist saying that if and when we have a Labour Government planning the 462 whole economy, we shall move more quickly towards a more prosperous society. But even under a Conservative Government we stumble by stages towards a more prosperous society. We have to recognise that manual workers in increasing numbers—those at the top end of the wage scale, anyway—are able to afford the kind of living standards in which they can plan over a period and in which they no longer receive a wage packet and spend its contents in one week. We are approaching a stage in which more and more of them are able to plan over a period.
In the past, there have been all kinds of ways in which working people have saved up for holidays, for the children's clothes and that sort of thing—perhaps in a tin behind the clock on the dresser. However, as one is able more and more to plan over a period, a bank account, a Post Office account, or something of that sort becomes the modern and useful way of doing it. It is an especially useful way of dealing with things such as mortgage repayments and hire-purchase repayments. The most convenient way of looking after matters of that sort is by banker's order.
I agree with those hon. Members who have said that the most useful of the alternatives in Clause 1 is that which I would have thought would be most attractive to most people, that which allows wages to be transferred straight into a bank account. There is not much value in receiving a piece of paper and at once changing it to cash, but in some cases there would be value in having wages transferred to a bank account.
Here I refer especially to Clause 1 (6) which offers a particularly useful proposition under which workers can ask for wages to be split, receiving part of their wages in cash and the other part being paid into a bank account. I hope that workers will ask for that arrangement and that employers will agree to it. On the face of it, it will not be to the convenience of the employer and will make the whole transaction a little less convenient for him, but as a piece of enlightened industrial relations, I hope that many employers will agree to it.
Many workers will want part of their wages in cash for ordinary weekly shopping, but will want some part of their wages transferred to a bank account 463 to take care of their liabilities like mortgage and hire-purchase repayments. If workers are not allowed to use that subsection, they will have to take all their wages in cash, paying part into the bank, or have their wages transferred to the bank and then going along to draw a cheque made to themselves.
Most hon. Members have been speaking in terms of banks, but we ought also to regard this as an opportunity to extend the operations of the Post Office Savings Bank. The Minister said that to enable the facilities of the Post Office to be fully used there would be amending legislation, and that that was being considered by the Postmaster-General. That is something that we ought to follow up. As a Socialist I am concerned with the fact that the Post Office belongs to us. I do not see why the Post Office should not extend its activities along the same lines as those which the private banks will follow.
The Post Office has many advantages for the person who uses it. A rate of interest is paid on money that is fairly liquid. The money can be withdrawn at short notice. There are more sub-post offices than banks in villages and remote areas. For many reasons the Post Office might be a more attractive way of enabling people to build up their savings and to use the facilities offered by the Bill.
For those reasons this is, on balance, a good Bill. It has, however, many dangers. Those dangers have been mentioned by many of my hon. Friends. There are two main groups of dangers. First, the danger that would arise if the Bill were applied too quickly. The Minister has said that he expects the Bill to take effect fairly gradually. If there is no undue pressure by employers on their workpeople to accept wages by cheque, or by one of the other methods, one would expect the Bill to take effect gradually. There is, however, the possibility of the Bill taking effect suddenly in certain localities. There might be an area dominated by a particular firm where all at once an employer is able to persuade everyone to take his wages in some way that is convenient to the employer.
We must consider carefully the problem that might arise if a change- 464 over is made too quickly in an area. The change-over might affect the village shop, which is also a sub-post office. If, in one week, one or two people present a cheque or a postal order for £8 or £9 and ask for it to be cashed, that would present no problem. If thirty people came in at once, and each person asked for a similar payment, that would create a serious problem. A certain amount of planning would be needed beforehand to cope with that possibility.
Most extraordinary results can occur if a change-over is made for which people are not prepared. I was told this afternoon about the experience of one of the London boroughs which decided to pay its clerical staff by cheque. I gather the change-over took place in four stages. In the first stage the staff were paid by cheque. They then went along individually to the bank and cashed their cheques. That went on for a few weeks. In the second stage various people asked their friends to cash their cheques, and thus a smaller number of people went along to the bank with a handful of cheques to get them cashed. In the third stage the council organised one person to go along with all the cheques and get them cashed. In the final stage the bank decided to co-operate and sent someone with the cash to the town hall. The result was that the staff were paid their cheques in one room and they then cashed them in the next room. That is perhaps an extraordinary example of what could happen if the change-over is made without proper planning.
Another aspect is the effect on the banks if in any locality there is a sudden change-over to the system of payment by cheque. My right hon. Friend quoted the statement of the general manager of Barclays Bank on the effect of the change-over on one medium sized branch. The general manager said that he would need not three cashiers as at the moment, but 26 to deal with the increased work. That is perhaps an extreme example, but it could happen.
The banks are already under pressure. Since the ending of the credit squeeze eighteen months ago, bank business has increased and the pressure on bank staffs has increased. Some hon. Members have said that it will be necessary for banks to consider remaining open for one or two evenings a week. 465 According to my information many of the people working in banks now regularly work to half-past six or seven o'clock every evening. They are already working under severe pressure.
That state of affairs adds force to the need for planning and to the need for consultation before the new system is adopted. There must be consultations with the banks and also consultations with the National Union of Bank Employees. As in other industries, there are two sides to the banking industry, and it ought to be recognised that bank employees have the right to be consulted about the proposed changes.
At the Trades Union Congress in September, Mr. T. G. Edwards, on behalf of the National Union of Bank Employees, referring to this proposed legislation, said:My union is not opposed to giving this service to workpeople or to any one else, if it is required and if they want it, and if they opt for it, but there must he full consultation in your own interests if we are going to prevent chaos in any change-over of the system of payment of wages.That was a constructive statement from someone who recognised that this Bill has value. It was a statement on behalf of bank staffs who are anxious to co-operate.
In his speech the Minister used a phrase which I thought was appropriate. He said that he did not want to drag anyone kicking and screaming into the twentieth century, but he ought to drag the bankers kicking and screaming into the twentieth century. He ought to use the Bill as a means for bringing both sides of the banking industry round one table. He ought to say that he will insist on seeing both sides of the industry in order to get his new Act working smoothly, because the Bill provides an opportunity to do something to improve staff—management relations in banking.
I come now to the other group of points which have been raised from this side of the House. Real dangers exist if the plans outlined in the Bill are misused by employers. As far as is humanly possible it is vital to ensure that the option provided in the Bill is an effective one; that there is no undue pressure; and that it does not become a condition 466 of employment that one must accept the payment of wages by the method which suits the employer.
Many of my hon. Friends have drawn attention to the way in which this aspect could be abused by the employers. From the tenor of the debate I gather that hon. Members opposite agree that every individual has the right to say that he will continue to have his wages paid in the way that he has been accustomed to receiving them if that suits him. There are many reasons for that. It has been said that some workers like to keep their earnings a secret. This is usually put in the context that a man wants to avoid letting people know what he earns. It may not be that a husband wants to avoid telling his wife how much he earns, but that a wife wants to avoid telling her husband how much she earns, or that a son or daughter wants to avoid telling his or her parents how much he or she earns. There may be all kinds of reasons for keeping earnings a secret—some good and some bad but nevertheless private and personal reasons—and we as a legislature have no right to dictate to people on these matters.
There is another point to consider. A number of people in this country—a minority but nevertheless a number of people—cannot read or write, or can barely read or write. To such people the idea of having bank statements or cheque books would be rather frightening. The hon. Member for Crosby (Mr. Page) said that 99.9 per cent. of the people could manage a bank acount. That is an exaggeration. Perhaps 90 per cent. of the people do so, but the other 10 per cent. deserve consideration if they do not like the idea of payment by cheque.
A number of people are satisfied with the present system of paying wages. They have become accustomed to it and want to carry on in that way. It is essential that we should safeguard the rights of those people. If only one man in a hundred sticks out for the right to be paid in cash, he must be considered. That is the spirit in which we ought to approach the Bill during the Committee stage to see whether we can strengthen its provisions.
We can all visualise this happening. An employer who wants his employees to take their wages in a particular way 467 can duplicate a number of letters for the employees to sign, letters asking him to pay their wages in this way. So far as I can see, they could be handed round under the provisions of this Bill. That would be a perfectly legal procedure because the employees would still have the legal right either to sign or not to sign. We can all envisage the sort of pressure there would be in that situation. We can all envisage people saying that they did not want to upset the boss.
What happens if this occurs in an area of heavy local unemployment? What happens if it occurs in a firm where a hundred people have been made redundant the previous week and where people are worried about who is to be the next man or woman to go? They will be cautious about offending the boss by not signing the form. This is the sort of thing which we shall have to look at to see in what way we can strengthen this Bill.
I think it would be wrong to reject the Bill because of these dangers. This House ought not to legislate on the assumption that all employers are bad and that all workers will not stand up for their rights. But we must recognise that there are bad employers and that large sections of industry are not organised by the trade unions. Only half the total working population of this country is organised in trade unions and the law has to be made as tight as possible to protect the others.
Several ideas have been developed during the debate about the way in which the Bill may be improved during the Committee stage. I wish to refer to one or two of them and perhaps to add some of my own. Clause 6 (7) has been referred to, that being the Clause which provides that an employee must not be required to make an application under Clause 1 whether as a condition of employment or otherwise. I hope that we may be able to find a form of words which will strengthen this Clause. One idea which has been suggested to me, and which I think should be examined, is that it should become illegal for an employer to ask the question of a prospective employee whether or not he will take his wages in the way the employer desires. It could, for instance, be made illegal to put that question upon an 468 application form, or even to ask it orally of a prospective employee. If an employer has three applicants before him for a job and chooses one of them, how are we to know, how is anyone to know, the reasons why the employer chose one of the applicants as against the others?
Another point is that the employer ought to be compelled under the Act to consult the trade union concerned if he proposes himself to suggest that a new method of payment be introduced into his works. If he proposes to invite his workpeople to apply to him to have their wages paid by cheque, it should be written into the Bill that the employer must consult with the trade unions concerned. I hope that in this matter, after the remarks which he made on the subject, we shall have the support of the hon. Member for Totnes (Mr. Mawby).
Unless that happens, trade unions are not likely to be able to give the kind of service and advice which in many cases they ought to give to their members. The first thing a district officer of a trade union may hear about this is that people in a certain place have already signed an application asking for their wages to be paid in a new way. Then it would be too late. If the unions are to advise their members of their rights in this matter, they ought to have time in which to do so, and that can happen only if there is a proviso in the Bill that the unions must be consulted beforehand.
I wish to make special reference to the problems of people living in tied cottages. It would seem that this is a special problem, because, in addition to all the other forms of pressure that an employer may exert upon his workpeople which have been mentioned, in these circumstances there is the extra pressure which derives from the fact that the employer owns the homes of his workmen. This applies mainly but not entirely in the countryside, where one would think that the advantages of this Bill to the worker are less than anywhere else; less because, for one thing, on the average the countryman gets a much lower wage and is less likely to require a bank account Another reason is that in the countryside it would be less convenient to go to the branch of a bank or to the Post Office. As has been mentioned, there is also the danger of gossip in the countryside. If a person took a cheque to the village 469 shop in order to get it cashed it would soon be all round the village about how much he earned. There are all these factors to be considered. In relation to people living in tied cottages in the countryside, I should have thought that the disadvantages inherent in this Bill outweigh the advantages. That is something which we must look at carefully as a special problem.
The other special problem to which I wish to refer is that arising out of Clause 4. It seems to me that this is different in character from the rest of the Bill, which is voluntary. This Clause is not. Under this Clause an employer can decide for himself to send wages by money order or postal order even if the employee objects to this procedure. The employee is not given any safeguard under the Bill. We ought to hear a great deal more from the Government about why they made this distinction. The Minister referred to it briefly. As I understood him, he was saying that this might present difficulties, there might be difficulties about the timing of requests from the employee to the employer in these circumstances. Yet I think we should find some formula—certainly we must return to this during the Committee stage—to protect the rights of a man who does not want his wages and a statement of the wages to be sent to his home.
I was discussing this problem recently with friends of mine who are trade union officials concerned with organising the workers in the road haulage industry. Road haulage workers are often away from home and I gather that there are all kinds of private arrangements existing at present between lorry drivers and their employers whereby in these circumstances given sums are sent to the lorry drivers' homes. Very often, it is a sum which is less than the total wage due to the driver. There are particular reasons for this. For one thing, a lorry driver's wages vary from week to week according to the number of hours he is on the road and his allowances will vary according to the number of nights he is away from home. All these special problems affect the amount of money due to him.
Many workers prefer a set sum to be sent home to their wives or whoever may be at home, and then they collect the rest at their convenience. I am wondering 470 how that sort of arrangement will be affected by the Bill. An employer, if he sends money to the home of a worker, will be required under the Bill to send a statement with it, and here there are special problems. I return to the point about privacy. For one reason or another a lorry driver, or anyone else, may not want a full statement of his wages to go to his home and, if we can, we should safeguard his position.
All the points I have referred to may be discussed during the Committee stage. It seems to me that, however we may improve this Bill in Committee, the central problem will still remain, which is that this is a Measure containing provisions which can be abused by a bad employer. It will be possible for an employer who wants to put pressure on a worker to be able to do so. We must arm ourselves against that by making the safeguards which exist in the Bill as widely known as possible. This will be partly a job for the trade unions and partly a job for the employers' organisations. I hope they will co-operate in suggesting to their members that the provisions of the Bill should be properly observed.
I suggest also that it is a job for the Government. We should have explanatory leaflets about the Bill giving the utmost possible prominence to its voluntary nature and the arrangements in the Bill for a man who does not wish to alter the way in which he is paid. It seems to me that this is a Measure which can, and one hopes will, enlarge the real freedom of those who desire to take advantage of its provisions. Looking at the best side of this Bill, it is something to enable workers who wish to receive their wages in a different way to be able to do so. It takes away any legal barriers which may now exist. The danger is that in enlarging the freedom of some people we may be taking away the freedom of others. Those are the dangers which we must be vigilant to overcome, both during the Committee stage and afterwards.
§ 8.20 p.m.
§ The Parliamentary Secretary to the Ministry of Labour (Mr. Peter Thomas)
I have followed the course of this debate with great interest and have gained from it considerable benefit and instruction. Like the hon. Member for East Ham, 471 North (Mr. Prentice), this is the first time I have had the privilege, and the ordeal, of making a winding-up speech in a debate on the Second Reading of a Bill.
I can assure the House that it is a matter of some relief to me that the principle of the Bill has met with general approval so far. Of course, certain reservations have been made and, indeed, some misgivings and criticisms have been expressed. But, in the main, the Bill has received good support from hon. Members on both sides of the House. In fact, I think that only the hon. Member for Burnley (Mr. D. Jones) came out unequivocably against it.
As was said by the hon. Member for East Ham, North, this is a Bill which can enlarge the freedom of those who wish to use its provisions. That is how we on this side of the House regard this Measure. The hon. Gentleman generously put forward the advantages of the Bill and, of course, mentioned, very objectively, the disadvantages.
Before I attempt to reply to certain points which have been raised, I perhaps may be permitted the pleasure of congratulating my hon. and gallant Friend the Member for The Hartlepools (Commander Kerans), my hon. Friend the Member for Wokingham (Mr. van Straubenzee), my hon. Friend the Member for Rutland and Stamford (Mr. K. Lewis), and my hon. Friend the Member for Bristol, North-West (Mr. McLaren), on having so successfully and skilfully overcome the awesome ordeal of a maiden speech.
In addition to any feeling of relief which they may have at the moment, they are certainly entitled to a feeling of considerable satisfaction, for each of my hon. Friends made a notable contribution to the debate. I am sure that the whole House will endorse my saying that we look forward to their participation in future debates.
The subject of the Bill is one, as has been said, which has its roots in the social history of a very different age, but the debate has shown that there is today still the same lively determination to see that the worker gets a fair deal as there was in the days of those earlier reforms. Repeated reference has been made in the 472 speeches delivered today to the Truck Acts, in particular to the 1831 Act on which the present truck law in this country is based.
Many hon. Members appear to me to see in the provisions of the Bill a disturbing breach of these Acts and of the protection which they give to workers. That, it would seem to me, is something which has underlined a great many speeches, and, in particular, those which have been delivered by hon. Members opposite. I can understand, and I have much sympathy with the deep feelings which exist as a legacy from the unscrupulous and iniquitous practices which were the reason for the passing of the Truck Acts. I can well appreciate the determination that the security of the workers under those Acts should not be weakened. But, with respect, I do not think that to view this Bill as a breach of the Truck Acts is a true or fair assessment of its provisions.
The basic principle of the Truck Acts is that a worker shall be paid his wages in full and, so as to ensure that he is so paid, he must be paid in cash and not in kind. As was said by my right hon. Friend in opening this debate, in no way does the Bill alter that general principle or tamper with the general structure of the Truck Acts. That is why the Bill is being considered in isolation from the general scrutiny which is being made at the moment by the Karmel Committee of the anomalies under the Truck Acts.
All that the Bill does is to bring the principle of full and honest payment into line with modern conditions, practice and requirements. What many hon. Members on both sides do not seem to have appreciated is that the law at present in regard to the payment of wages is more restrictive than it was in 1831 when the Truck Act was passed. This was referred to by my hon. Friend the Member for Crosby (Mr. Page). It is a matter of some importance to which we must pay attention when considering this type of Bill.
The Truck Act, 1831 provided that, where a worker freely consented, payment by cheque was permissible. It was considered at that time to be a permissible form of payment, provided that there was free consent. All that Parliament was concerned about at that time was that the cheque should be drawn on 473 a bank of substance so that it was secure and on a bank which was easily accessible to the worker, so that the cheque should he easily encashable. It was for those reasons, and no others, that the Act limited payment by cheque to payment by bearer cheque drawn on a bank licensed to issue notes and which was not more than 15 miles from the place of payment.
As my right hon. Friend said in his speech, in 1831 Parliament could hardly have anticipated that in the course of time the Bank of England, which, incidentally, does not accept private accounts, would be the only bank in England and Wales licensed to issue notes. The position today is, therefore, that the prohibition that wages should not be paid by cheque has become part of the truck law in England and Wales—not deliberately, but accidentally.
This point, referred to en passant by one or two hon. Members, should be considered carefully. The law today prohibiting payment of wages by cheque, by credit into a bank account, by postal order, or by money order is not a prohibition on all workers. It is not even a prohibition on all manual workers. The somewhat obscure scope of the prohibition has already been mentioned. The only people coming within the prohibition are those people defined as "workmen" within the meaning of the Employers and Workmen Act, 1875, which was passed and drawn up, as everyone will appreciate, in industrial and social conditions very different from the present.
The hon. Member for East Ham, North gave certain examples. A bus conductor has been held not to be a worker within the definition of that Act. Therefore, he could lawfully be paid by cheque whether he consented or not. On the other hand, a bus driver has been held to be within the ambit of the Act and cannot be paid by cheque even if he wishes to be. Many other examples can be stated. When a daily "char" is working in one's home, she is a domestic servant and is, therefore, outside the ambit of the Truck Acts. She can be paid by cheque at the end of the week. If, before coming to one's home, she had been cleaning an office, she would then be a "workman" within the ambit of the Truck Acts and her employer in the 474 office would have to pay her in cash; even if she wanted a cheque she could not have it.
I am sure that all hon. Members would agree that it is a peculiar situation today when a highly skilled worker, doing a responsible and important job on the factory floor, and earning high wages, possibly also having a bank account, cannot, in law, have his wages paid to him other than in cash, even if he expressly wishes it. Conversely, a typist working in the factory office, earning far less wages than the skilled worker, can be required to accept a cheque. I believe that it is the feeling of the House that such a situation is wrong. If a man wants to be paid by cheque, either directly to him or into his bank account, he is entitled to be so paid, if his employer agrees. There is no reason why this accidental and archaic discrimination between manual and non-manual workers should continue any longer.
One important consideration has been freely expressed from both sides, namely, that workers should not be compelled to accept their wages in this form, but must be genuinely willing to do so. This is a consideration which we have borne in mind throughout and to which we attach great importance. When the N.J.A.C. considered this, it also thought that it was important. We have done our best to ensure that there are strong safeguards in the Bill. Hon. Gentlemen will know the safeguard included in the Bill as to a written request, which must be made by the workman before he is entitled to be paid in any other form than cash. There is also Clause 6 (7), which has been referred to by many right hon. and hon. Members. That is a very strong safeguard which should ensure that any payments made under the Act, other than payments made under Clause 4 when the employed person is sick or absent, are made in a manner which is freely and willingly requested by a workman.
I am sure that the House will not wish me to deal with all of the points that have been raised in the debate. Some matters of importance have been raised and some difficulties have been expressed. The right hon. Gentleman the Member for Blyth (Mr. Robens) asked why it was thought necessary to bring in the Bill without awaiting the result of the Karmel Committee's investigations. He said that 475 he believed that the Committee's report should be ready by this summer and that there was, therefore, no need for this Bill to go through the House at this time. I must confess that I found it a little surprising that he should feel able to say that the report of the Committee would be ready by this summer—
§ Mr. Robens
I know that the Parliamentary Secretary would not wish to misquote me. I said that I thought it might well be that the report would be ready this summer. Obviously, I could not definitely say when the report would be ready.
§ Mr. Thomas
I can understand why the right hon. Gentleman says that he would not be in a position to say when the report would be ready. This will be the report of an independent Committee, and for that reason I myself, speaking from the Department, would not be able to speak authoritatively on it, and I am sure that he would also agree that he could not speak authoritatively on the matter—
§ Mr. Thomas
Yes. My information is that it is highly unlikely that the report will be ready this year. As the right hon. Gentleman knows, the Truck Acts are a very complex subject. The legislation is extremely involved and there are many anomalies. It is not a simple matter, such as is contained in the Bill, and the subject will require very careful and, unfortunately, long study.
In any event, it was considered that although it would have been possible to have waited for the Report of the Karmel Committee it was not necessary to do so, as this present matter is something that can be dealt with quite separately. As I have tried to point out to the House, this Bill is not, in fact, a breach of the Truck Acts. It seeks to bring the payment of wages, with the consent of the worker, into line with modern conditions—
§ Mr. Robens
But is that not just playing with words? Surely, in this respect, we are amending the Truck Acts. Nobody is talking in terms of breach, but the Bill would not be before the House if we were not changing something. We are amending the Truck 476 Acts. Why should we play with words and pretend that we are not doing that?
§ Mr. Thomas
We are doing something that the right hon. Gentleman himself said most forcefully should be done, in the debate on 12th June, 1959, when the former hon. Member for Lanark, Mr. Patrick Maitland, had his Bill before the House. We are trying to right a wrong. On that occasion, the right hon. Gentleman saidI think that the sponsors of the Bill, having on more than one occasion brought this issue to the House, have established their case. They have established the case for another look at the Truck Acts. They have established the right of the workman if he so desires to have his wages paid by cheque or into his banking account if he happens to have one. Having established that case, which is freely accepted by all in this House, I think that the wisest course would be to invite the Government now to take over those principles and to have the kind of talks to which reference has been made with industry and the banking world, in the hope that Government legislation would be brought to the House and would receive approval in all quarters of the House to meet the two main points emerging from this Bill."—[OFFICIAL REPORT, 12th June, 1959; Vol. 606, c. 1416.]
§ Mr. Robens
I gather now that my information that the Karmel report would be ready this summer is inaccurate. However, it does not destroy the case I was then making, that it was worth waiting a few more months to bring in a new Bill based on the Committee's recommendations. I do not think that there is anything wrong in that.
§ Mr. Thomas
I cannot understand the right hon. Gentleman's difficulty. On 12th June, 1959, he said that this was something requiring to be dealt with and that it should, therefore, go back to be considered by all the people interested in and concerned about it, and that if the wrong was taken up by the Government as being possible of remedy it should be righted.
§ Mr. Robens
The Parliamentary Secretary forgets the argument which he started. He started with the point I made that we might wait for the Karmel's Committee report, a point that I based on the information I had that the report would probably be ready by the summer. It was to that that he addressed his remarks. Once he says that the report will not be ready until the end of the year it raises an entirely new issue.
§ Mr. Thomas
I am very much obliged to the right hon. Gentleman. I do not wish to prolong this. If he will agree that we are right to bring this legislation forward, separately from the main investigation of the Karmel Committee into the Truck Acts I will not pursue the matter any further.
The right hon. Gentleman also referred to the extreme distaste demonstrated during the war by the county council roadmen against the County Council Roadmen (Payment of Wages) Order, 1942, and instanced that as an expression of the distaste which workers, or some workers, would have to payment by cheque. He will recollect that my right hon. Friend mentioned that this was wholly compulsory. In fact, it was written into that Order that no roadman to whom the Order applied should be entitled to require the payment of his wages, or of any part thereof, otherwise than by a cheque drawn on the council's bankers.
I can understand that there would be widespread dissatisfaction about that state of affairs, but that is wholly different from this Bill. As the right hon. Gentleman appreciates, in the Bill it is intended that there should be no form of compulsion. The right hon. Gentleman and other hon. Members have said that they wish to be certain that no pressure would be applied to make a man do what he does not want to do, and I quite agree that that is an important matter.
It will be known that in Scotland today employers can, if they wish, pay their workers by cheque, because the Truck Acts prohibition does not apply, if there is a bank licensed to issue notes within 15 miles of the place of payment. There has been no great demonstration in Scotland of employers being anxious to force upon unwilling workers this method of payment, and I think that the whole House will agree that it is very unlikely that there will be any immediate change once the Bill is passed. We will undoubtedly be able to gain great experience where those workers who want to be paid in that fashion can be so paid, and most people will agree that it is a change for the better.
One matter which I could not quite understand was the right hon. Gentleman's objection to Clause 4. As I see it, the whole House accepts that it is correct 478 to write into the Bill a provision that if a man is away from his normal place of payment, either by reason of sickness or accident or because his work has taken him away, it is right that he should be paid by some means other than cash, so that he can get prompt payment.
The only issue is whether it should be written into the Bill that it should be obligatory that he should request that form of payment. There may be occasional cases where a man is not in a position to make the request. He may be taken ill far away from his business, and it would mean that he would be deprived, certainly for a week, of his normal wages. But these are matters which can be considered. With respect, I think that possibly this is a Committee point, and I think there should not be any violent objection to Clause 4.
§ Mr. Thomas
I am informed that in many cases the workman, when ill, has been paid in this form. There is some doubt whether he was legally so paid, but I am informed that there are many cases in industry today in which a man has been paid in the form envisaged in Clause 4.
My hon. and gallant Friend the Member for The Hartlepools referred to the plight in which small businessmen and publicans might find themselves if suddenly placed in a position in which they were asked to cash cheques, and he mentioned the dangers and difficulties that would be involved. Of course, one would accept the difficulty which retailers would have to face if, in fact, there was a flood of cheques as a result of this Bill, and if workers were going round trying to find somewhere to cash their cheques. It will be remembered that, as I think many hon. Members have mentioned, this is not a Bill dealing only with the payment of wages by cheque.
This is, as I think my hon. Friend the Member for Twickenham (Mr. Gresham Cooke) put it, mainly a Bill for payment by banker's credit. There is little likelihood of a sudden rush of cheques in the possession of workers anxious to have them met. It will be remembered, also, that this provision in 479 the Bill will not come into effect until an order has been made by my right hon. Friend, and my right hon. Friend said at the beginning of the debate that, before doing so, he would consult the people interested and discuss the situation with them.
The hon. Member for Greenwich (Mr. Marsh) asked why people who are outside the scope of the Truck Acts could not be brought in. That is a matter of some importance. Whereas many workers are within the ambit of the Truck Acts, millions are not, and they will not have the benefit of the Bill. But, of course, while there is a Committee sitting, as there is at the moment, we consider that it would be improper to tamper with the Truck Acts to the extent that an extension of the scope of the Acts would involve. A good deal of extremely complicated legislation would be required. As I have said, the scope of the Truck Acts is not affected by the Bill and, therefore, it is felt that it can go forward without tampering with them in any way.
My hon. Friend the Member for Crosby described himself as, during the past few years, a lone voice crying in the wilderness. He is now, fortunately, back at home, and we are delighted to have been able to assist him in this Bill. My hon. Friend mentioned two Committee points. I am sure that they require examination, and I promise him that we shall look at them closely before the Committee stage.
The hon. Member for Feltham (Mr. Hunter) asked, first, for an assurance that it would not be made a condition of employment that a man should be paid in the manner evisaged in the Bill. This, of course, is the main point, and, as I have already said, we intend to do all we can to see that there are clear safeguards in the Bill. In our view, Clause 6 (7) is an adequate safeguard in that respect.
The hon. Gentleman then asked what would happen if the cheques could not be met, if a firm paying its wages by cheque suddenly went bankrupt and the cheques were not honoured. That is a very different situation. I do not know how one could deal with it in a Bill. The workman, of course, would be no worse off in those circumstances than 480 he would be if his employers had gone bankrupt and had been unable to pay him in cash. He has not been paid until he has received cash for his cheque, and he retains under the Bill his preferential rights against his employer under the Bankruptcy and Companies Acts. Those rights are not affected.
The hon. Member for Oldham, East (Mr. Mapp), who spoke, I am sorry to say, when I was not here—my right hon. Friend made a note of what he said—pointed out that pay day is normally a Friday and that new methods must be found so that the worker can have his actual cash on the Friday. I should think that that would be extremely easy to effect if payment were made by one of the methods set out in the Bill.
The hon. Member for Rotherham (Mr. J. Jones) was courteous enough to tell me that he could not stay to hear the whole of the debate. I regret to say that I did not hear his speech, but I heard his intervention in the speech of my hon. Friend the Member for Totnes (Mr. Mawby). I agree entirely with what the hon. Member said about the effect of the Bill. He gave a graphic description of how he thought that it would work in a modern factory under modern conditions. I think that that is exactly how the Bill will work. I reiterate what has been said that this is not a payment by cheque Bill. It is mainly a payment by banker's credit Bill.
The hon. Member for Burnley was somewhat concerned about the fact that companies may be involved in a two-payment system. Companies are already involved in that to a great extent today, and the hon. Member will recollect my right hon. Friend's reference to the case of I.C.I. It does not seem that there will be any difficulty there. The hon. Member also said that the T.U.C. had not agreed to this measure and spoke as though my right hon. Friend had said that it had. My right hon. Friend, of course, did not say that the T.U.C. had agreed to it. He said that the N.J.A.C., which has representatives of the T.U.C. on it, had approved the provisions of the Bill.
Many other matters were raised, and I fear that I should speak for far too long if I tried to deal with every one of them. It is clear that the Bill has met with considerable approval from all 481 sides of the House. It is clear that much consideration will have to be given, after the Bill is passed, to see that it works smoothly throughout the country, but this debate has shown that the Bill goes forward with a great measure of good will behind it. No one supposes that it will bring about widespread and sudden changes, but it opens the way for changes and for the adaptation of our system of paying wages to the habits and needs of a modern age.
§ Mr. D. Jones
Would not the Minister agree that the existence of this Bill will tend to destroy the impartiality and, consequently, the value of the Karmel Committee's report when it is eventually presented?
§ Question put and agreed to.
§ Bill accordingly read a Second time.
§ Bill committed to a Standing Committee pursuant to Standing Order No. 38 (Committal of Bills).