HC Deb 21 July 1965 vol 716 cc1693-700

The provisions of Part I of Schedule (Death of employer or of employee) to this Act shall have effect in relation to the death of an employer; and the provisions of Part II of that Schedule shall have effect in relation to the death of an employee.—[The Solicitor-General.]

Brought up, and read the First time.

The Solicitor-General

I beg to move, That the Clause be read a Second time.

Perhaps it would be for the convenience of the House to discuss, at the same time, Amendment No. 43 and the new Schedule Amendment No. 87. They all fall together.

Mr. Neil McBride (Swansea, East)

On a point of order. Would you take with this the Amendment standing in my name, Mr. Deputy-Speaker, on page 4606, as an Amendment to the proposed new Schedule, in line 193, after "employee", to insert: who dies before the end of the period of six months beginning with the relevant date".

Mr. Deputy-Speaker

It had better be discussed now with the new Schedule, but it will have to be moved when we come to it.

The Solicitor-General

I must make it quite clear that I propose to ask the House to accept my hon. Friend's Amendment to the Schedule when we come to it.

These new provisions are necessary to clarify the position when, in the various circumstances provided for in the Bill, an employee dies when he is entitled to a redundancy payment or when his entitlement is not resolved at the time of his death and, secondly, to amplify the provisions already made by Clause 18, relating to the death of an employer. The hon. Member for Buckinghamshire, South (Mr. Ronald Bell) said on the last Clause that the Opposition, on this Bill and, I gather, on other Measures, are acting as a sort of Parliamentary "long stop". I am sure that that is a function which they will continue to carry out for a long time ahead. I acknowledge at once that some of the points with which the Schedule deals were raised by hon. Members opposite.

The Schedule, I am afraid, is necessarily a long and complex document, because we have to deal here with a considerable number of different situations which could arise. Part I relates to the death of the employer and it provides, in paragraph (3), that, where a worker's contract is terminated by the death of his employer, he will not be entitled to a redundancy payment if he is re-engaged by the personal representatives of a deceased employer within eight weeks after the death.

If he is not re-engaged within that time and no offer of re-engagement has been made to him, he will be treated as having been dismissed for the purposes of this Bill and he will be entitled to his redundancy payment from the personal representatives, by virtue of the new Clause, "Implied or Constructive Termination of the Contract", if the fact of his not being re-engaged were attributable to redundancy—that is, either to a complete cessation of the business or to a reduction in its requirements for employees. I suggest to the House that this is a reasonable arrangement. It gives this margin of eight weeks, during which re-engagement must take effect if liability for a payment is to be avoided.

The House will appreciate that, in arriving at the figure of eight weeks, we had to hold a balance between the interests of those who may be carrying on the business after the death of the employer and who may—indeed, almost inevitably in most cases—need a certain amount of time in order to sort out the affairs of the business, and the interests of the worker himself, who cannot be expected to wait indefinitely for a possible re-engagement and should not be penalised because he has lost his employment in this way rather than in another. I therefore suggest that eight weeks is a fair and reasonable period.

Paragraph 4 of the Schedule has the effect that a worker is not entitled to payment if he unreasonably refuses an offer of re-engagement by the personal representatives taking place within eight weeks after the employer's death where the employment offered is either on the same terms as before or, if on different terms, is suitable in relation to the worker concerned.

The effect of paragraph 5 is that, in deciding whether the employment offered is suitable or whether the worker acted reasonably in refusing it, the mere fact that the personal representatives have taken the place of the deceased employer is irrelevant, so the worker could not argue that he was reasonable in refusing the offer simply because he did not like the new management.

The Schedule deals with lay-off and short-time but provides in paragraph 7 that, if the worker has been laid off or kept on short-time immediately before the employer's death but has not served notice of claim on his employer and is then re-engaged by the personal representatives within eight weeks of the death, and if, after re-engagement, he is again laid off or kept on short time, he can aggregate the weeks after re-engagement with the weeks before, ignoring the break in his employment following the death for purposes of any claim in respect of lay-off or short-time which he may make on the personal representatives. I hope that that will commend itself as a reasonable arrangement.

Paragraphs 8 to 10 deal with cases where the worker has been laid off or kept on short-time to such an extent that he has served notice of the claim on his employer while he is still in employment and within four weeks of the time he served that notice the employer dies. Four weeks is appropriate because, if the employee is still in employment more than four weeks after service of the claim, he will normally forfeit any entitlement under the provisions for layoff and short-time.

Paragraph 12 of the Schedule ensures that any break in employment between the employer's death and re-engagement by the personal representatives shall not in any way break the worker's continuity of employment.

Paragraph 13 deals with a somewhat different situation. It relates to employees in domestic service. One may have a case where the employer dies and the household and the occupancy of the house is taken over not by personal representatives but perhaps by someone else, maybe a member of the deceased's family. In these circumstances, supposing the re-engagement is arranged not by the personal representatives but by the new occupier of the house, it is reasonable that some provision should be made as if the personal representatives had been responsible for the new engagement.

I come now to Part II of the Schedule, which deals with the death of the employee. This makes a number of provisions which I hope that the House will approve. It provides, first, that if the worker dies during the notice, on the expiry of which he would have been entitled to a payment, his personal representatives will be entitled to a payment in respect of his service up to the time of his death. Secondly, if he becomes redundant and is offered alternative work and dies before accepting it, his personal representatives may pursue a claim with the tribunal if they think that he would have been reasonable in refusing the offer.

The effect of paragraph 18 is that if a worker has been given notice by his employer but before the notice expires he wants to leave and has given notice to that effect, and if he dies, his personal representatives may pursue with the tribunal his claim for a redundancy payment under the provisions of Clause 4.

Paragraph 19 deals with short-time and lay-off, and paragraph 20 provides that in general, by virtue of Clause 21, employees must claim payment not later than six months after they have been dismissed. However, paragraph 20 provides that where an employee dies his personal representatives are allowed—up to 12 months instead of six months—to lodge a claim. It is in respect of this provision that my hon. Friend the Member for Swansea, East (Mr. McBride) is proposing an Amendment. I hope that the House will agree that the Schedule makes clear and reasonable arrangements to meet the various contingencies which are contemplated.

Mr. Ronald Bell

This is a formidable addition to the Bill. I have already referred to the volume of Government Amendments, both in Committee and on Report, but this outdoes all previous additions and additions which are to follow—no less than 210 lines being added to the Bill in this one proposal, which seems to cover almost every imaginable contingency, except that of employer and employee dying at the same moment. Perhaps the Solicitor-General would care to tell us what would happen in that extraordinary circumstance. Would the law of property legislation come into this?

I have no criticism of the provisions of the new Schedule, because, of course, the new Clause is purely and simply a hook on which to hang the Schedule. All I can say about it is that it is remarkable that when the Government brought the Bill forward they should have overlooked all the difficulties which are dealt with by this proposal. The Solicitor-General generously conceded that some of these difficulties were pointed out in Committee by my hon. Friends and me. We feel that we have done a valuable job on the Bill and I am a little worried—and I can see that the Parliamentary Secretary is a little worried, too—lest the vigilance of the Opposition may not have covered all the defects in the Measure.

When we reflect that in Committee there were 100 Amendments, 45 of them tabled by the Government, and that at this stage there are about 30 pages of Amendments—almost all of which relate to points which the Opposition picked up—we cannot help wondering whether there have been oversights, inadvertencies, anomalies, and drafting mistakes which have still been overlooked. I am bound, in a spirit of humility, to point out that there may be dozens of others which have been missed. When we come to this Schedule—which contains a fair sprinkling of points which my hon. Friends and I raised in Committee—we are bound to wonder how many other difficulties will arise in the administration of the Bill. I must not allow speculation to go too far, even on the Second Reading of a new Clause, when we are allowed rather more latitude than when considering an Amendment. I repeat that we have no words of opposition to address to the Government about these provisions. They are sensible and deal in a practical way with many of the points which we raised.

The period of eight weeks is obviously setting the consideration of one side against the consideration of the other. That is reasonable, and I therefore commend the new Schedule to my hon. Friend's. It is perhaps not inappropriate that, on behalf of the Government, I should congratulate them for the good work they have done as the architects, so to speak, of this Schedule. I must address to the Parliamentary Secretary and Solicitor-General a gentle reproach for bringing forward a Bill with so many gaps and oversights which might have to be filled by an enormously protracted Report stage which we would be having were my hon. Friends and I not trying to be thoroughly co-operative and not wishing to make party points. As I say, we wish to be reasonable in our consideration of the Bill.

9.15 p.m.

Mr. Geoffrey Howe (Bebington)

I want to speak on a less enthusiastic note than my hon. Friend has done. I agree that the Opposition bear some responsibility for the inspiration of this new Schedule, but I hesitate to say that we are the architects. Let us leave that responsibility to the Government—there may well still be defects. In considering the practical application of the arrangements when the employer has died, I doubt whether a period of eight weeks is long enough. I know that the employee wants some certainty, but we must relate these provisions to the smallest and humblest of employers, whose personal representatives may scarcely know that they are the personal representatives.

An employer may die intestate, but his estate may be such that the only function of the personal representatives would be to spring into action to take the appropriate steps under this Bill. In such a case I doubt whether anything will happen. The inflexibility of the eight-week provision may well give rise to real hardship to the personal representatives when linked to the comparatively formal steps they have to take to prevent the estate later being saddled with responsibility for redundancy payments.

I suggest that something more flexible is needed to deal with the kind of situation envisaged. I was attracted by the notion behind new Clause No. 9 dealing with implied or constructive termination of contract. In that connection, the Solicitor-General might well bear in mind the situation under the Rent Acts, when implications can or cannot arise as to the creation of a new tenancy in favour of the heir or personal representative of a deceased tenant. It is there possible to imply the creation of a brand-new tenancy in favour of someone who would otherwise be able to claim as a statutory tenant.

In many cases when the existence of this Measure will probably be unknown to the personal representatives of the deceased employer, when the niceties of this new Schedule will be unknown, and when one would expect the employment to continue just as before, no one will bother to take the formal steps laid down in the new Schedule yet, because of that, a claim for redundancy payment may raise its head later. I ask the Government to look again at the emphasis on paper formality at every stage throughout the Bill, and, in particular, in this Schedule. May there not be room for an added period of grace, or the implication of re-engagement without express contractual provision?

Sir Tatton Brinton (Kidderminster)

I wish to refer to Part II of the new Schedule in relation to the practices which the Government themselves follow in regard to their own employees. I agree with the provisions of the Schedule, which give the heirs of a deceased employee the right as it were to inherit his redundancy payment if it would have become payable had he not died. That is perfectly fair, but I ask Ministers to compare these provisions they are making for payments within industry with those which the Government themselves in all our joint names make to the heirs and assigns of their own servants, notably the Armed Forces.

There are many cases in which gratuities have become payable to men who have signed on, but their widows are not eligible for the full amount of the gratuity which those men have earned as of right. Yet here we have a right which arises only because of the redundancy which because of death does not take place. I draw attention to this anomaly. The Government ought to look at it because the provisions they are making here, while fair enough themselves, compare very favourably with what the Government do for our own servants in the Armed Forces.

Mr. Godber

I support my hon. Friend the Member for Kidderminster (Sir T. Brinton). This is a point which had not occurred to me, but it seems to be of great significance. There is a point of principle here. If we are to impose on employers generally responsibilities of this kind it is up to the Government to see that they set an example in this regard as in others.

In most employment practices one can safely say that in Government service we seek to set an example for others to follow. Whatever party has been in power that has been accepted. The point made by my hon. Friend is of considerable significance. In this Bill we are imposing responsibilities on all other types of employer. They are responsible for providing sums and that is accepted and welcomed on both sides of the House, but if there is a comparison in which the Government do not come out favourably, particularly in regard to the Armed Forces, it ought to be looked into. I hope the point will be carefully looked into.

This is a very detailed and complicated proposal. We accept the principles, but will discuss the separate Amendments later.

Question put and agreed to.

Clause read a Second time, and added to the Bill.