EMPLOYMENT EXCHANGES (Hansard, 12 July 1967)

§ Mr. Nicholas Ridley (Cirencester and Tewkesbury)
I beg to move, That leave be given to bring in a Bill to regulate all employment exchanges, both public and private; to ensure competition between them; and for connected purposes. The Bill would regulate all employment exchanges, fee-charging, non-fee-charging, profit-making or not profit-making, whether they be trade unions or trade associations or public labour exchanges. I think that a Bill is needed to draw up fair rules of competition so that all the agencies and organisations in this field can compete fairly on equal terms, and so that the exact position of the law is known to all.
There was a Bill which attempted to do this for one section only, the private fee-charging employment agencies, but I think that it is wrong to single out one section of the profession like that and try, as it were, to level it down to the standard of all the others. Instead, I am sure that we should not allow the Government to muzzle their competitors, as it were. We should draw up rules so that all employment agents can compete on fair terms.
Public labour exchanges have one enormous advantage as it is, in that they are free: they are paid for by the taxpayer. There is no doubt that that is a great advantage, and it must be a little sad for the Ministry of Labour that, with this enormous advantage, it has failed to compete for the ever-growing volume of business in this field and with the immense growth of private exchanges since the war, although private exchanges, of course, have to charge fees in order to make them solvent. It is a little humiliating for those who support the State as always being right against 728 private organisations that this state of affairs has led the National Economic Development Council to suggest that the State should do something about the labour exchanges to make them more attractive. Indeed, we now have news of a statement by the Minister of Labour next Monday setting out how he is to improve the public exchanges.
All this I welcome. It is necessary to improve the image, if I may use that rather tarnished word, of the public exchanges, and I think that one of the ways in which this may have to be done is by encouraging public exchanges to charge fees. I think that people do not quite like to go for something for nothing. They prefer to be charged the right price, because then they know they are getting value for money, and I do not see why the public should pay to provide free competition for one other form, that is, the private agency. I am glad to hear that the Federation of Employment Agents' has offered to help the Government and the N.E.D.C. to get their labour exchanges on to a more efficient and attractive footing. All this is to be welcomed.
We come, therefore, to the need, in my opinion, to lay down rules whereby these varying sorts of employment agencies—trade unions, labour exchanges, private fee-charging agencies—can compete fairly between themselves. I do not think that any wider form of control is needed than that. Where we have a profession such as this, its rules of competition should be laid down and should be made to work properly.
The Bill which I seek leave to bring in attempts in the main to do two things only: firstly, to insist that competition is free and fair and open between all corners in this field, and secondly, to make sure that the prices, fees or rates which are charged are made known to the general public so that all can compare the different services and different prices which are being offered. If one is not satisfied with A one can go to B. This is the cardinal rule of the laws behind a free society which adopts competition and the market as its test. After all, this is just one more market. This is the market for employment, and those who wish to change their jobs or seek new employees must know who is available in the market, which jobs are available and at 729 what price. Just as if one picks up the Financial Times one can read the price of every share, so one ought to be able to read at a glance the price of every job and the charge of every agency so that greater knowledge of job opportunities is available. That is all that is necessary to regulate a profession of this sort.
The Bill will contain rules that it shall be illegal under penalty of a heavy fine to make restrictive agreements between two or more agencies to follow a pricing policy; in other words, to fix a price ring. The trade federations would be stopped from issuing instructions or recommendations about the increasing or cutting of fees or in any way aligning fees one with another. The Bill would lay the duty upon all agents to publish their fees. The fees would have to be notified to the licensing authority, and notification of their fees to any prospective clients would be another condition. I would go so far as to say that the level of fees charged in every agency should be displayed prominently in its office.
I do not say that these things are not done already in the vast majority of private employment agencies. It is true to say that competition is very fierce and effective already. However, I believe that it is necesssary to include all agents and to make it quite clear what the rules are to be. It is also necessary to include in the Bill au pair girls, both those being placed abroad and those coming from abroad to obtain employment here, self-employed staff and all forms of staff and employment as at present. The Bill would not include management consultancy, staff contracting, nurses, and some of the other extraneous professions which were brought into a previous Measure which we considered earlier in the Session.
Some other provisions are necessary. The system of licensing by local authorities which exists can be built upon and made mandatory for all local authorities. I believe that that is better than central control. We should therefore make provision in the Bill for local licensing administered by local authorities.
There have, of course, been complaints about such things as misleading advertising, appropriation of clients' moneys and unfair charges, and declaration of interests by employment agencies—something which has been suggested in the past. 730 I wonder if many of these complaints could not be dealt with in companies legislation or other legislation, but it may be that they should be included in a Bill of this nature where they are peculiar to the profession.
I would emphasise, however, that if one is not satisfied with the service which one gets from any employment agency or labour exchange, the remedy always should be to go to another one which gives better service. This is the classical basis upon which our society was built, on which it developed and became the most powerful society in the world. Rather than go into a form of detailed regulation, control and interference in every day-to-day detail of employment agency work, the Bill tries to bring all of them—public, private, trade union, fee-charging and otherwise—on to the same basis and lay down rules of competition. That golden word is the way to protect the consumer, rather than trying to get the gentlemen in Whitehall to do the work for the agent.

§ Mr. Speaker
The Question is, That leave be given—

§ Mr. Speaker
Does the hon. Gentleman wish to oppose leave?

§ Mr. Jenkins
Yes, Mr. Speaker. I wish to oppose the Motion which the hon. Member for Cirencester and Tewkesbury (Mr. Ridley) moves for leave to introduce this Bill. To hear him this morning, one would not think that he, perhaps more than any other hon. Member, is personally responsible for the fact that there is not an Act to regulate employment agencies on the Statute Book already, except, perhaps, for the rather doctrinaire note which he allowed to creep into his speech at the end of his remarks.
The vast majority of jobs are offered and obtained without the intervention of any sort of employment agency. Probably few hon. Members have ever paid anyone to find work for them, though a few may have paid agents to find shorthand typists or secretaries.
As distinct from an employment exchange which provides a service without charge to employers and employees, a fee-charging employment agency is parasitic by nature. This is demonstrated by the fact that the profit seeking agent is 731 only to be found in those areas of employment where there is either a shortage of work or a shortage of qualified workers. What is more, when there are many people seeking a few jobs, as in the world of entertainment, the agent makes his profit out of the employee. For example, most actors employed in the West End, in films and on television pay at least 10 per cent. of their wages to an agent, and not just for the first week of work but for every week throughout a run. On the other hand, the situation is arising in which more and more employers of secretaries and shorthand typists find themselves forced to pay an agent, again not only for the first week but for every week of so-called temporary employment.
If there was a general need for a service between employer and employee which warranted payment, that service would not only operate in conditions of shortage. The person charged would not always be the one in need. The employment agent is often no more than a means of exploiting shortage for gain, and this fact is recognised in many countries. Not only in Communist countries, as one might suppose, having listened to the hon. Gentleman, but in almost all European countries, including those in the Common Market, fee-charging employment agencies are prohibited. The suggestion that this recognition is in some way dictated by doctrinal considerations is false, though I suggest that the opposition directed at the earlier proposed legislation was so dictated.
In 1949 the International Labour Organisation issued a Convention which provided for employment agents to be abolished or regulated. Many countries have ratified the Convention and have chosen abolition. We chose regulation, and in 1951 the previous Labour Government announced their intention to ratify on this basis. They fell from office before doing so, unfortunately, but the Conservative Government who followed also announced their intention to do the same and, after long discussions, detailed the nature of the proposed legislation which was to be introduced. It was never brought into effect, but the Bill which I introduced and which received an unopposed Second Reading more than 732 a year ago followed in all essentials the pattern proposed by the previous Tory Government.
My Bill does not propose to abolish the fee-charging agent. It has never been my purpose to do that, because I think that, providing they operate under supervision and on an agreed basis, there is a useful function—

§ Mr. Speaker
Order. The hon. Gentleman cannot in this debate seek leave to reintroduce the Bill which he has already introduced to the House. He must oppose this Bill.

§ Mr. Jenkins
I understand, Mr. Speaker, and I apologise for straying from the rules of order. I was saying, in the wrong way, that an agent who does his job properly and is content with a reasonable remuneration for his services can perform a useful function, providing that his activities are kept within bounds. However, this proposed Measure will not have that effect.
Why did the hon. Member for Cirencester and Tewkesbury not support the previous Measure? Why did he put down so many Amendments—

§ Mr. Speaker
Order. The hon. Member must oppose this Measure. We are not discussing his Bill.

§ Mr. Jenkins
I am sorry, Mr. Speaker, if I have strayed once again. I was endeavouring to suggest that this Bill is unnecessary because there is already a previous Measure which is far advanced in the House. One of the reasons I was putting forward for opposing this Bill was the existence of the previous Measure. I recognise that I must touch only lightly on that, but I hope that you will not consider it entirely out of order that one of the reasons why we do not want this Measure is that there is the Measure to which I have referred, but I understand that you are telling me that I must not spend too much time on that.
I move from that and ask why the hon. Member seeks to introduce a new Measure. It was possible for him to amend, indeed he tried to amend the previous Measure and succeeded in some degree. Since my Bill is still before the House and will reach its conclusion this Session or in the next one, the hon. Member should be refused permission to introduce his Bill, which would not 733 merely be redundant but would be a "phoney" piece of legislation because it would pretend to deal with problems which it would not actually touch and would leave out matters which need to be dealt with.
The House should throw out this Motion with the contempt that it deserves. It is not a serious endeavour to deal with the problem of controlling employment agencies. There is a Bill already before the House which does that. I hope that the House will not confuse the issue by the introduction of a new Measure which falsely pretends to do something which is already in process of being properly tackled.

§ Mr. Speaker
Objection having been taken and since a Division has been claimed, I am bound by paragraph 4 of the Sessional Order to declare proceedings on the Motion deferred until the end of today's business.