§ Ms. Quin
I beg to move amendment No. 8, in page 5, line 39, after '1981', insert'and the EC Directive 77/187 (The Acquired Rights Directive)'.94 The amendment contains a reference to European Community directive 77/187—the acquired rights directive. We tabled the amendment because we understand that there may well be a discrepancy between the Transfer of Undertakings (Protection of Employment) Regulations 1981 and the directive, under which the TUPE regulations were introduced in the United Kingdom.
I refer the House to article 6 of the acquired rights directive:The transferor and the transferee shall be required to inform the representatives of their respective employees affected by a transfer within the meaning of article 1(1) of the following: the reasons for the transfer; the legal, economic and social implications of the transfer for the employees; measures envisaged in relation to the employees.The transferor must give such information to the representatives of his employees in good time before the transfer is carried out … If the transferor or the transferee envisages measures in relation to his employees, he shall consult his representatives in good time on such measures with a view to seeking agreement.The TUPE regulations only require the employer to inform recognised representatives long enough before a relevant transfer to enable consultation to take place, and they make no reference to seeking agreement.
If the acquired rights directive is not fully honoured on this occasion, would employees in these circumstances have some sort of legal resource? To avoid any move of that sort, it would perhaps be sensible explicitly to invoke the acquired rights directive to cover the transfer of the ISG to a private buyer. By including a reference to the directive, which we have signed, a greater obligation to consult meaningfully with trade union representatives over the transfer would be imposed—an imposition that would include not only consultation but a commitment to seeking agreement between employees and Government over the proposals. That would be an important commitment, especially to the employees at Cardiff. By assuring them that their views are being fully taken into account they would know that the consultation is not just a cosmetic exercise that will not result in any changes.
§ Mr. Sainsbury
I can assure the hon. Lady that the consultation is far from a cosmetic exercise. It is a full and comprehensive consultation—I have already mentioned 700 individual interviews—involving both trade unions and members of staff.
The amendment is not appropriate. The acquired rights directive requires member states to enact provisions in their own law to give effect to the policy described in the directive. Under Community law directives are binding in effect, but the choice of form and method of achieving that effect is left to member states. The Transfer of Undertakings (Protection of Employment) Regulations 1981—we happily refer to them as TUPE—were the enactment of the directive in United Kingdom law. To apply the directive to the same transactions as those to which TUPE apply would be unnecessary and confusing for anyone trying to determine what his or her position in law was. It would apply two statutory provisions different in drafting style and expression and one of them, the acquired rights directive, was not framed with United Kingdom concepts of law in mind. It was not designed directly to operate in the context of the United Kingdom's legal system. The result would be increased uncertainty and possible doubt about the law.
Having chosen to implement the acquired rights directive by means of TUPE, it is doubtful whether it 95 would be in accordance with Community law to try to implement it again in relation to a specific transaction to which TUPE would also apply. If we did that, we could be accused of avoiding the choice of a formal method, which is required under Community law. The amendment would injure the interests of ECGD staff by creating confusion about their rights. I urge the hon. Lady to withdraw the amendment and to stick to TUPE, which enacts in United Kingdom law the requirements of the acquired rights directive.
§ Mr. Morgan
The Minister tried to dodge the entire issue by claiming that TUPE is the British style enactment of the acquired rights directive. He must be able to demonstrate that the 1981 TUPE version of the 1977 acquired rights directive is relevant to 1991. In their 11 or 12 years in office, the Government have tried to cut this country away from the entire general drift of industrial relations provisions for consultation on major changes in employment by large firms. They have tried to cut Britain adrift from Community legislation on employment and from the social charter.
There is an interesting and relevant item in The Independent this morning relating to the Government's problems on this issue. It shows that in 1991 this issue is still a burning topic. It is not enough to say, as the Minister has said, that TUPE incorporates the necessary legislation. If that is true, why was it necessary for the right hon. Member for Bath (Mr. Patten), the chairman of the Conservative party, to write on the topic to Wilfrid Martens, the chairman of the Christian Democrat Federation? The Independent seems to have acquired a copy of the letter which relates to the application by the British Conservative group in the European Parliament to become members of the Christian Democrat group. A typical Christian Democrat would have accepted our amendment straight away because it incorporates the latest and most up-to-date thinking about what employees deserve by way of consultation rights. The Government will not accept the amendment because of the current battle for the soul of the Conservative party.
In his letter, the right hon. Member for Bath said that Britain supported'a social dimension to the social market"".Many Conservative Ministers, including the two who are in the Chamber, would find that deeply offensive and contrary to their fundamental beliefs. The letter speaks of a social dimension,that takes into full account the criteria agreed at the Madrid European Council in June 1989.It refers to the principle of job creation and recognises the principle of subsidiarity. I cite that letter in the context of the struggle for the soul of the Conservative party. Under the acquired rights directive or any legislation dealing with rights acquired or given to employees in any kind of transfer from the public to the private sector or, as is more common, during a takeover within the private sector, do the employees of a large enterprise have any right to be consulted?
Most Conservative Members who are present in the Chamber think that such employees should not have any rights at all, but they are obliged to give them some under European directives because the Government need to 96 ensure that they can hang on to the people that they need to make a success of the transfer. The Minister said that British law in 1981 covered the 1977 acquired rights directive, but we need to know his interpretation for 1991 and beyond. Given what has happened in the past 10 years, is that the last word on acquired rights?
More time should be given and we should make more use of formal trade union negotiating machinery. Will everything be done without reference to the formal negotiating rights of the Whitley council and the civil service trade unions? The Government like to bypass the trade union negotiating machinery so that they can pick people off one by one using special offers. They want to be able to make transfers to the private sector with as little consultation and trade union bargaining machinery as possible. We want from the Minister a bit of honesty about what the Government are playing at in seeking to effect a transfer with the minimum of acquired rights. People in Britain should have maximum acquired rights in the same way as people in other European countries.
§ Ms. Quin
I should like to reinforce some of the points made by my hon. Friend the Member for Cardiff, West (Mr. Morgan).
The Minister rightly said that European directives provide a framework for national legislation which is enacted in detail. However, there can be legal challenges if it is felt that a country has not satisfactorily implemented a directive. There have been legal challenges on many directives, such as the directive seeking to ensure equal opportunities for women in the workplace and the equal treatment directive. It has been claimed that the United Kingdom has not properly implemented directives. Surely it would be possible under the acquired rights directive to have such a challenge.
The Minister said that, basically, we are debating two different statutory provisions—the acquired rights directive and the TUPE regulations. Is not it the case that, when the subject area is the same, the EC directive can override national legislation? In any legal dispute, the European directive has precedence over national regulations. Therefore, the two matters are not quite as separate as the Minister gave us to understand.
§ Mr. Sainsbury
As I think I said, the Transfer of Undertakings (Protection of Employment) Regulations date from 1981. It would be possible to challenge whether they effectively implement the acquired rights directive, but they have been in place for 10 years and no such challenge has been made. I have not heard anyone suggest that they fail in any way satisfactorily to implement in United Kingdom law the acquired rights directive. It would be confusing to try to include the acquired rights directive as well as TUPE, which is the method of implementing that directive in United Kingdom law. TUPE takes account of our legal concepts but the acquired rights directive does not.
§ Ms. Quin
The Minister has admitted that a legal challenge is possible. In any dispute between the TUPE regulations and the acquired rights directive the directive will be dominant. His reply confirms our wisdom in tabling the amendment. The issue is complicated and there are many different aspects to consider. Rather than pressing the amendment to a vote—I imagine that it will be examined in the other place—I beg to ask leave to withdraw the amendment.
§ Amendment, by leave, withdrawn.