HL Deb 22 April 2002 vol 634 cc519-50GC

[The Deputy Chairman of Committees (Lord Brougham and Vaux) in the Chair.]:

The Deputy Chairman of Committees (Lord Brougham and Vaux)

I do not think there is any need to remind the Committee that there are no Divisions and Members of the Committee should speak standing. If there is a Division in the Chamber, the Member of the Committee who is speaking should stop as soon as possible and we shall adjourn for 10 minutes to allow Members of the Committee to vote.

Clause 45 [Fixed-term work]:

Baroness Miller of Hendon

moved Amendment No. 233: Page 49, line 33, at end insert— ( ) This section shall not apply to a person in fixed-term employment who has been offered in writing by his employer permanent employment of a substantially similar nature to his fixed-term employment on substantially similar terms and conditions to those of other permanent employees whose employment is of a similar nature. The noble Baroness said: Clause 49 empowers the Secretary of State to make regulations for the benefit of employees working for a fixed term as distinct from employees working for an indefinite term. This is despite the fact that an employee working on an indefinite term contract may have considerably less security of tenure than one working for a fixed term.

For example, someone may be employed for a fixed period of six months perhaps to stand in for someone who is taking maternity leave. However, the fixed-term employee may be subject to dismissal oil a month's notice, or a period of notice determined by statute according to the length of his service with that employer.

People enter into fixed-term employment for a variety of reasons ranging from necessity to personal choice. The fact is that fixed-term employees are not necessarily the downtrodden, exploited group of workers which the EU seems to believe need special protection as evinced by Directive 99/70/EC mentioned in this clause.

To the contrary of what I have just said, it is equally true that some employees on fixed terms are treated less favourably than their colleagues working on indefinite contracts. It is also true that some unscrupulous employers may use the device of employing workers on a series of consecutive fixed-term contracts in order to avoid having to give the employee benefits that accrue for long service. It is against this sort of abuse that this clause is intended to work.

The sort of philosophy that seems to permeate Brussels in the social engineering that their directives often generate—directives eagerly adopted and, I to say, gold-plated here—is that all employers are wicked capitalists (and I hope I have said enough in the days leading up to now to suggest that not all employers are that way at all) grinding the faces of the poor who must be protected by the paternal bureaucrats. It reminds me of the slogan in Animal Farm, four legs good, two legs bad", or, in this context, employees are always good and employers are always bad.

Whatever the rights and wrongs of the philosophical approach by the regulators to fixed-term work, there is one category of fixed-term employee who does not need any special protection or special privileges to give him equality with his indefinite-term colleagues. That is a fixed-term employee who has been offered permanent employment by his employer.

The amendment sets out stringent conditions for exception to operate. The offer must be in writing so that there is no doubt that the work has been offered and on what conditions; the work must be substantially similar to fixed-term contract; and the employment must be on substantially the same terms and conditions to the other employees whose work is of a similar nature.

In other words, what we are looking at is a fixed-term employee who is being offered to be upgraded, if that is the correct description, to permanent employment. I do not suggest that such an employee should be compelled to take up the indefinite employment. If he chooses not to do so for whatever personal reason, that is entirely a matter for him.

What the amendment does is to say that the fixed-term employee who is offered a permanent job has to make up his mind which type of employment he prefers and, if he chooses to stick to his fixed term, he cannot have his cake and eat it and enjoy the special privileges being accorded to fixed-term employees. I beg to move.

The Parliamentary Under-Secretary of State, Department of Trade and Industry (Lord Sainsbury of Turville)

The intention of the amendment seems to be that the regulations made under Clause 45 should not apply to fixed-term employees who have been offered suitable permanent employment at any point during their employment and refused the offer. This would mean that the provisions in the regulations limiting the use of successive fixed-term contracts would not apply. However, the other provisions in the regulations—for example, the right to be informed of permanent vacancies—would also not apply. An employer would therefore be within his rights to continue to employ the fixed term employee on an indefinite number of successive fixed term contracts. That would be the case even when a fixed term employee decided, at some time after he had been offered and refused permanent employment, that he would after all prefer a permanent job in the organisation.

The directive requires us to prevent the abuse of successive fixed term contracts; the amendment could allow abuses of such contracts. As such, it could well mean that we would be unable to meet the directive's transposition requirements. The directive applies to all fixed term employees (with a few specified exceptions) regardless of whether they wish to be in fixed term or permanent employment.

The intention of the amendment may be to protect those fixed term employees who command better remuneration packages as a result of their fixed term status. The draft regulations stipulate that where a fixed term contract is renewed in breach of the limitation on successive fixed term contracts, it is to be regarded as a contract of indefinite duration. The regulations do not require that the employee must accept the terms of other permanent employees doing similar work in these circumstances just because his contract is to be regarded as permanent. There is nothing in the regulations that would require a fixed term employee to accept a lowering of his remuneration package as a result of permanent status.

The abuse of successive fixed term contracts must be prevented, yet it is also important that employers and employees are able to enter into contracts that suit their needs. Fixed term contracts are used in a variety of sectors, ranging from teaching to transport.

The mechanism in the draft fixed term regulations provides flexibility for employers and employees by allowing the use of fixed term contracts beyond the statutory limit where their use is objectively justified. The limit can also be varied by collective or workforce agreements. That mechanism is therefore sufficiently flexible that employer and employees can vary the limitation on the use of successive fixed term contracts where that will suit their particular needs better.

I turn to the other aspect of the point raised by the noble Baroness, Lady Miller. The draft regulations need not allow highly paid fixed term employees to have their cake and eat it by obtaining permanent employment on better terms and conditions that were designed to compensate them for the non-permanent nature of their work. Terms and conditions of employment are for negotiation between employers and employees. Employers will still be able to negotiate alterations to contracts with their employees.

I hope that the noble Baroness is satisfied with that explanation and ask her to withdraw her amendment.

Baroness Miller of Hendon

The Minister suggested that my amendment might have unintentional consequences—I am not sure about that, and I will read what he said. At this stage, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment.s Nos. 234 and 235 not moved.]

Clause 45 agreed to.

Clause 46 [Fixed-term work: Northern Ireland]:

[Amendments Nos. 236 to 238 not moved.]

Clause 46 agreed to.

Clause 47 [Flexible working]:

Baroness Miller of Hendon

moved Amendment No. 239: Page 51, leave out lines 28 and 29. The noble Baroness said: In moving this amendment, I shall speak also to Amendments Nos. 240 to 244, 247 to 251, 253, 254 and 256.

Clause 43 introduced a new statutory concept of learning representatives. In the same way, Clause 47 introduces a new right for workers—the right to demand a unilateral variation in the freely negotiated terms of employment. If an employer attempted to do such a thing, the employee could rightly claim that he or she had been wrongly dismissed and obtain compensation—probably quite substantial compensation at that. Although there is a law against wrongful dismissal, I do not believe there is a countervailing law against wrongful leaving.

As I said as a preface to my remarks on Clause 43. this new legislative concept has some rough edges which need trimming, especially as this whole clause was not before the Committee in the other place. That is why I want to speak to it here.

Clause 47 introduces new Sections 80F, 80G, 80H and 80I and consequential Amendments Nos. 47D and 104C into the Employment Rights Act 1996. In two separate amendments—Amendments Nos. 239 and 240—I propose the deletion of paragraphs (iii) and (iv) of subsection (1)(a) of new Section 80F. Those two paragraphs go further than merely giving the employee the right to alter the number of hours that he is required to work and the times when he is required to work those hours. Those two factors, and those alone, are what are generally understood by "flexible working", or "flexi-time", as it is often called.

When I was in business in Germany, the staff worked flexi-time, clocking in and out to suit their personal needs. Women with young children set their hours around the times their children were in school, and some of the men found it convenient either to come in early or to stay later. The employees were required simply to work a minimum number of hours every business week.

Paragraph (a)(iii) suggests that there should be a further right in addition to the right to vary one's working hours; namely, the right of an employee to choose whether he works at home or at his employer's place of business. I agree that these days many jobs can, indeed, be done at home via computers and modems. Unfortunately, that facility is not available to manual workers who are required to work in a factory or on a building site or wherever.

As I said previously, this Government wish to secure the egalitarian ideas emanating from Brussels, such as equal rights for fixed-term workers, as discussed in relation to the previous clause. Therefore, I believe that it is ironical that the Government are proposing rights which, from a practical point of view, can be exercised only by one type of employee—the so-called white collar worker, as distinct from the blue collar one.

Ignoring that purely philosophical aspect, the point is that giving the employee the right to choose the venue at which he works is likely to cause major disruption to the employer over and above that which will already be occasioned by the working of flexible hours and the changes to those hours. It is also likely to cause resentment among other employees who must not only work normal office hours but must struggle to and from work on the inadequate public transport system. The flexi-hours concept was intended to enable a new parent to look after his child more easily; it was not intended to allow the employee to carry out all his or her work in an atmosphere where that work would be subject to the distraction of looking after a child throughout the working day.

Amendment No. 240 relates to paragraph (a)(iv), which is also objectionable because yet another blank cheque is being demanded. The subparagraph proposes that the Secretary of State can alter other terms of employment. As I pointed out, the Bill already allows the employee to change the number of hours that he works, the times at which he works them and, unless my previous amendment is accepted, where he carries out his work.

What else can he ask to change? Perhaps he would like to change the type of work that he does or change his duties altogether. I certainly cannot think of anything else that would be in a normal employment contract. Perhaps, when he replies, the Minister will tell us what the Government have in mind. If he cannot do so, then I am not sure what purpose this subparagraph serves and I believe that it should simply be deleted, as the amendment seeks to do.

With Amendments Nos. 241 and 242 we come to new Section 80F(2), which deals with the contents of the employee's application for a contract variation. However, subsection (2) has an elementary drafting error which Amendment No. 241, to which I am now speaking, seeks to rectify. Although, as I said, the subsection specifies the contents of the application to change the terms of employment, it does not specify the fact that the application should be in writing. Without that requirement, there could be endless arguments as to what the employee had requested or, indeed, whether he had requested anything at all. Common sense suggests that the only practical way for an employee to apply would be by letter but, so long as there is no requirement that there should be something in writing, the scope of the argument, and indeed bad faith, could be endless.

The way in which subsection (2) specifies what the application must tell the employer makes it clear that the only practical way to do that would be in writing. However, there is always the danger that someone who fails to comply will—or could—pretend that he did so orally. To paraphrase the late Sam Goldwyn, a verbal application is not worth the paper it is written on.

Amendment No. 242 adds to the essential contents of the application set out in subsection (2). The list of contents has, in my view, been very fairly drawn. I am especially glad to note that the employee is to be required to give some consideration—pursuant to subsection (c)—to the effect that that might have on his employer. That would mitigate against people simply taking advantage of the concession because it is theirs as a right, and not because it is really needed.

However, one piece of information is missing from the list. That is covered by the amendment. Nowhere in the clause as it is currently drafted is the employee asked to explain why she or he needs to change the terms of employment; all that would be needed, for example, would be a statement such as, "I need to leave by 3 o'clock in order to collect my child from school". If the employee has a valid reason, there will be no difficulty in saying what it is. On the other hand, without being told what the reason is, the employer will not be in a position to give due consideration to the application that new Section 80G requires him to do.

Amendment No. 243 would correct an important omission from subsection (4). The Bill, quite rightly, insists that an employee may not make multiple applications and that, if an employee applies for a change, he or she has to stick with it for a year and especially cannot seek to modify the modification within that year. The amendment seeks to make such a requested change of terms a permanent change—"permanent", that is, to the extent that it will have to be adhered to for the same period of the year that the Government have specified for the interval between his applications. What cannot be permitted is for the employee to apply for a contract variation for a short period, such as a month or a few months.

An employer will always have to reorganise his business in order to accommodate an employee. As it is currently drafted, I foresee resentment among workers without children who might have major family commitments, such as elderly parents or a disabled spouse. The employer needs to be protected against the disruption caused by short-term chopping and changing. Also, there is nothing to prevent an employer and employee from coming to an amicable voluntary arrangement if that suits them.

I do not know why the Government seem to think that every arrangement between parties has to be the result of a compulsion. There are more good and understanding employers out there than there are very bad ones.

Amendment No. 244 is needed because, once again, the Government are asking for a blank cheque. The Secretary of State wants the power to specify the period of employment before an employee qualifies for the benefits of contract variation. The Secretary of State wants power to fix the qualifying duration of employment. Why cannot the Government tell us here and now just what they have in mind with regard to these provisions? I am sure that they must have thought out the matter already. Judging by previous form, whatever the Government specify in the first: set of regulations, the qualifying time might gradually be eroded. We have seen that in relation to the issues of redundancy, wrongful dismissal, equal rights and so on.

It is also not unreasonable to expect a new employee to know what his or her commitments will be in the next six months and to have them covered in the original contract. However, what is not reasonable would be for the Secretary of State to, for example, set an arbitrary period of four weeks or even less. Six months is a perfectly reasonable qualifying period by any standard.

I turn to Amendment No. 246—I am not moving Amendment No. 245. It is quite possible that an employee may have more than one child under the age of six years, thereby qualifying for the right to request a variation of her contract. I said "quite possible" but in fact it is a very frequent occurrence. In my own case, there was a brief period when I had three children under that age and when the eldest reached the age of six, I had his two brothers still under the age of six for another three years.

It is agreed that a mother with a child under the age of six should be able to seek a variation in her terms of employment. This application limits the variation in terms of one application for every 12 months. This is consistent with the Government's own proposals in new Section 80F(4)in which they provided that an employee could not make more than one application in a period of 12 months.

However, the section relates to one child, as subsection (3) makes clear. It refers to the 14th day before the child concerned reaches the age of six. Members of the Committee will note the words "the child"; "child" in the singular. An employee seeking to take advantage of the right to flexible working now to be granted to him should make up his mind as to what his needs are and if there are conflicting needs because he has more than one child, he should tailor his application to take that into account.

I accept that there could be a change in circumstances in the period of 12 months. Another child could arrive, but, at worst, there would be a period of three months at the end of the period covered by the original application when the employee finds himself with a new child before he can make another application. I do not say that in any callous sense.

In subsection (4)—as I have already pointed out—the Government themselves prohibited a new application before 12 months from the original one. It may well be that an employee could in the circumstances that I have discussed suffer some inconvenience for a very short period, but this legislation has to be even handed. The convenience of the employer, often a small one, also has to be considered.

Amendment No. 247 deals with the new Section 80G(1)(b), which specifies the grounds upon which the employer may refuse an application for a contract variation. Subject to the four amendments that I shall be proposing next, the nine-item list contained in paragraph (b) seems to be reasonable. However, the preamble needs to be amended. It states that an employer: shall only refuse the application because he considers that one or more of the following grounds applies". The amendment I propose does not depart from the draft wording in the Bill, except that I believe that the employer's belief must be reasonable. Presumably the addition of this word adds to the employee's rights, so that he might not object to it this time. As drawn, the word "reasonably" has to be implied and nowhere does the Bill give the tribunal actual power to do so or specifically to prevent the employer from acting arbitrarily or unreasonably. Otherwise my amendment does not alter the principle of the clause in any way.

Amendments Nos. 248 to 251, the next four, are to improve the grounds upon which the employer may refuse an application. I hasten to point out that they are not designed to minimise the employee's rights, but they are designed to tighten up the wording—to be more prescriptive.

Amendment No. 248 alters the words "the burden of costs" in paragraph (i) to "material additional cost". It is inevitable that complying with every application for contract variation will result in some additional cost. Practically every provision in the Bill will add to the burden of costs on employers, but the amendment ensures that only material increases will be taken into account. What is material, as in other instances in this Bill—and, indeed, in the general rules of construction applied by the civil and criminal courts—will, of course, depend entirely upon the circumstances and there should be no difficulty for any experienced tribunal in deciding whether a cost is material or is not.

In Amendment No. 249 I propose that the word "staff" be changed to the word "employees". I do not know where the new concept of staff as distinct from employees has crept into the Bill. We have already found ourselves debating the difference between workers and employees—I think during the previous session—and we certainly should not need to introduce yet another word that would cause confusion and a distinction, perhaps without a difference, and create grounds for nit-picking litigation.

Amendment No. 250 alters paragraph (4) which deals with the recruitment of what the Bill calls "staff and who I propose should also be called "employees". It has to be the case that the employer should be recruiting employees of similar capacity on similar terms and conditions. The employer cannot be compelled to recruit a replacement, whether capable or not, and who expects different wages and different employment terms. All the employer should be required to do is to replace like with like. The amendment makes it clear that the replacement or supplementary staff to be recruited should be suitably qualified to meet the employer's needs.

Amendment No. 251 to paragraph (viii) is essential because as drawn it simply does not make sense. Even without my amendment to the preamble and using the words of the Bill, it reads: one or more of the following grounds as applies (viii) planned structural changes". What does that mean? I presume it means that the change of terms of employment would be incompatible with planned structural changes, but the words as I have just read them simply do not say that. That is what the amendment makes clear. The clause should now read: one or more of the following grounds applies (viii) incompatibility with planned structural changes". In no sense does this amendment alter the effect of the Bill.

I now turn to Amendment No. 253. New Section 80G(2) specifies the regulations that may be made governing an application for variation in terms of a contract. Paragraph (k) makes provision for an employee to be accompanied by someone of a description prescribed by the intended regulations. I assume that this is likely to be a trade union representative or a fellow employee, but whoever it is there is no provision for an employer to receive similar outside assistance. I think that that is unfair. It is also yet another breach in the Bill of the Human Rights Convention, notwithstanding the certificate that the Minister has given. Everyone is entitled to be represented by counsel, whatever qualification that counsel has, for the purposes of the Bill.

Amendment No. 254 is to have the new marginal note: Reduction or withdrawal of benefits under Section 80F application". This is a matter of simple justice. If an employer is going to be obliged to acquiesce in the variation in the employee's contract in the form of reduced hours, he should be entitled to a quid pro quo in the form of a proportionate reduction, not only in the pay received by the employee, which is self-evident, but also in any additional benefits that the employee receives.

Members of the Committee will notice that the amendment refers to benefits paid to the employee, which makes it clear that the amendment refers to cash benefits and not to benefits in kind such as holiday time, company car and such like. It applies only in cases where the working hours are reduced. It does not apply where, for example, it is a simple case of a change in the actual time that the employee works. It refers to profit-sharing schemes, bonuses and other cash paid to employees working under a standard contract.

The second leg of the amendment, in paragraph (ii) is a long-stop in case there is some form of benefit that cannot be prorated. For example, if an employer pays for an employee's season ticket in return for a 40-hour week and the employee reduces his or her hours to 32 because of taking a three-day weekend, that benefit ought to be reduced. I cannot give any other examples, but I wish to ensure that there is no loophole. It entitles an employee whose cash benefit cannot for some reason or other be prorated to be given a different cash benefit instead.

I now come to Amendment No. 256, which is the last in this group. New Section 80H(i) specifies the grounds on which an employee may complain to a tribunal if he is refused a variation in his contract. Paragraph (b) gives as one of the grounds that: a decision by his employer was based on incorrect facts". Amendment No. 256 proposes that the ground should be more specific and stipulate that there was a materially incorrect error. We cannot have applications to the tribunal made and granted by the tribunal—as it would be bound to do—simply because the employer had made some trivial, unimportant and irrelevant error. Again, it is difficult to cite a possible example of what error could occur among the nine reasons specified in paragraph (b). It is, however, clear that a small clerical error or factual error could occur in the employer's reasons which in no way would have influenced his decision and cases should not he decided by the tribunal being farced to ignore that lack of materiality. I beg to move.

4 p.m.

Baroness Turner of Camden

I wonder whether I might put a question to the noble Baroness. She referred to flexi-time, a system with which I have some familiarity, as she clearly has also. I wonder why the noble Baroness introduced that and why she believes, as she apparently does, that flexi-time working is in any way incompatible with the provisions set out in the Bill. I do not understand why she raised that point.

Baroness Miller of Hendon

I referred to it only in the context of Amendment No. 233 that I moved earlier which I said I had spoken to in general terms.

Lord Sainsbury of Turville

The grouping of the majority of the noble Baroness's amendments together in a single debate gives me the opportunity to say some general words on the clause, as she has done, and to mention two changes we wish to make to the clause on Report. I shall then go on to deal with the issues she has raised in moving the amendments themselves.

I make one general point in answer to the opening remarks of the noble Baroness. The measure does not give anyone the right to choose his terms and conditions of employment. It gives him the right to ask to have his terms and conditions of employment changed. It also specifies the procedure that employers have to follow when considering requests and the acceptable business grounds for refusing a request. That is very different from saying that people have the right to change their terms and conditions of employment at will.

For the first time the law will facilitate a dialogue between parents and their employers about working patterns that better meet parents' childcare responsibilities and their employers' needs. It will help remove the stresses parents face in both raising their children and in meeting their work responsibilities.

The Government consulted widely on the issue of flexible working. Throughout the consultation period for the Green Paper, Work and Parents, Competitiveness and Choice, flexible working was identified as the biggest issue for both employers and employees.

Last summer the Government established the Work and Parents Taskforce to look at how to meet parents' desire for more flexible work patterns in a way that is compatible with business efficiency. The task force consulted widely on how this should be done. Its recommendations have been well documented during Committee stage in the other place. It is worth repeating, however, that key to the task force's terms of reference was the commitment to build on best practice, and to design a light-touch legislative approach to giving parents of young children a right to make a request to work flexible hours and to have this request considered by the employer. I strongly believe that the task force recommendations achieve this and represent a sound workable approach that is acceptable to both employers and employees.

By reaching a full consensus of opinion, the task force presented the Government with an opportunity to facilitate a genuine culture change at the workplace to the benefit of employers, parents and their children. That is why we accepted all of its recommendations either in full or in principle. It is also why we have kept as close to its recommendations as possible when translating them into legislation, an approach that we will continue to adopt in the drafting of the accompanying regulations. Among others, the TUC and CBI both welcomed the task force recommendations.

Before I turn to the specific points covered in the amendments, I wish to take the opportunity to inform the Committee of two amendments to the clause that the Government intend to table for Report stage.

The clause as currently drafted applies to the Armed Forces. All members of the Armed Forces are liable to be deployed operationally at little or no notice if national interests require it. These unique features of Armed Forces life make it difficult to apply long-term flexible working arrangements as envisaged in this new right to request flexible working. For these specific and unique reasons it is the Government's intention to table an amendment to exempt the Armed Forces from the provisions of this clause when the Bill is considered at Report stage.

I should add that the Armed Forces will continue to seek to comply with the spirit of the legislation, subject always to overriding operational requirements. They fully recognise the benefits of flexible working to individuals and to their organisations.

Our second proposed amendment concerns ACAS. The main priority of the flexible working provisions is to foster dialogue between parents and employers in order to find a flexible working pattern to suit them both. As part of this commitment, it has always been the intention to follow the Work and Parents Taskforce proposal of extending the binding arbitration scheme prepared by the Advisory, Conciliation and Arbitration Service to deal with disputes regarding requests for flexible working which cannot be resolved in the workplace.

The extension of the scheme will also allow us to ensure that as few cases as possible end up at the employment tribunal. Because the arbitration is binding, those who opt to use the scheme also waive their right to have their case heard at tribunal. However, an amendment is required to ensure that it is possible to extend this scheme. Again, we intend to introduce this amendment at Report stage.

I will now address the specific points raised in the amendments that the noble Baroness has tabled. Amendment No. 239 would prevent homeworking from being included within the new right. Specifically the clause allows for eligible parents to request a flexible working arrangement that is a change to, first, the hours they are required to work; secondly, the times when they are required to work; and thirdly, where, as between their homes and places of business of their employer, they are required to work, that is homeworking. There is also a regulatory power to add other changes to an employee's terms and conditions if appropriate circumstances arise, which Amendment No. 240 addresses.

Homeworking is a well-recognised form of flexible working and, with development in technology, is a practice used to good effect by many employers. It need not be worked on a full-time basis. An employee may divide their time between the usual place of work and home.

The amendment would therefore prevent many parents from being able to request to work from home to help them better balance their work and family lives. It would not be sensible to have a clause on flexible working and then to exclude homeworking.

Amendment No. 240 would see the grounds on which an employee could apply for a change in working pattern restricted solely to those set out in the clause. This is clearly inappropriate.

The purpose of new Section 80F(1)(a)(iv) is to ensure that as new flexible working practices develop they can be included within this clause. The subsection achieves this by giving the Secretary of State a regulatory power to specify additional criteria to define flexible working patterns as they develop.

The noble Baroness asked for examples to be given. One example would be the content of work, but this is always rather an irrelevant consideration because, when one puts in a clause to take account of future events, almost by definition one does not know what they will be. It is rather like asking scientists what the results of their research will be. If one knows what the results will be, it is no longer research. If one wants an example, however, it could be the content of work.

Working patterns have changed immeasurably over the past few decades. Due to technological advances we now see many people working from home. Changes in consumer demand now see retail businesses open, in some cases, 24 hours a day, seven days a week.

It is impossible to say how things may change in coming years. If we were to restrict the power from the outset and cater for today's flexible working patterns with no scope to accommodate new flexible working patterns as they develop, it would certainly prevent us from being able to cater for the needs of families and employers in the future.

Amendment No. 241 will require an application to work flexibly to be in writing. As I have already indicated, it is the Government's intention to follow the Work and Parents Taskforce recommendations as closely as possible. This includes its proposal to require applications to work flexibly to be in writing.

Members of the Committee will see that new Section 80F(5) provides the Secretary of State with a regulatory making power to prescribe the form of applications to work flexibly. I can therefore assure the Committee that it is the intention that regulations will provide for applications to be made in writing, either manually or electronically.

I should like to add that it is equally important that employers' decisions about an application or their decisions on an appeal are also made in writing. We will therefore be using the regulatory powers provided in the clause to ensure that the "in writing" requirement applies at these stages also.

Amendment No. 242 would require employees to specify the reason why they require changes to their working patterns other than simply certifying that it is for the purpose of caring for a child. It would require a parent to explain their personal circumstances to their employer. We think that this is inappropriate and over burdensome.

The Government tasked the Work and Parents Taskforce with designing a light-touch process which balanced the rights and responsibilities of both parents and employers.

The introduction of another layer of explanation would require parents to explain their personal circumstances to employers. While I am sure that some of them will do so voluntarily, the task force looked at this in detail and decided unanimously that such extra questioning was unnecessary. In addition, during the consultation on the introduction of paternity leave, employers were asked whether fathers should be requested to prove that they were taking leave for the purpose of caring for a child.

Employers made it clear that they did not want to go into the detail of their employees' personal circumstances. For example, parents might have to reveal relationship difficulties with their partner or reveal that a sister who had been caring for their children was now moving away. What value can that possibly add to the employers' consideration of the case on business grounds?

Amendments Nos. 243, 244 and 246 all concern the eligibility criteria for making an application to work flexibly. Amendment No. 243 would make it absolutely clear that, where a flexible working pattern was agreed, it would be a permanent change to an employee's terms and conditions. An employee would have no automatic right to revert to his previous pattern of work should he desire to do so at a later stage.

I can assure Members of the Committee that that is the effect of the legislation as it is presently drafted and that there is no need for the amendment. The first line of new Section 80F(1) states that: A qualifying employee may apply to his employer for a change in his terms and conditions of employment". It is clearly implied that there is no right to return to the previous working pattern. The guidance that will accompany the legislation will also make that point. Once a change is made, it will be permanent unless the parties agree otherwise at the time of negotiating the change or until another application is made at least 12 months later.

That was the recommended approach of the Work and Parents Taskforce, which found that, having taken the trouble to implement a flexible working pattern, there was little desire among employers to unpick the arrangement. In addition, it was likely to be difficult to do so. For example, a new employee might need to be recruited to cover the parent's absence. If the flexible working arrangement was to come to an end, perhaps several years later, the employer would then also have to consider the impact of the change on the individual recruited to cover the parent's absence.

However, there will be circumstances where, although an employer cannot agree to a request as presented to him, he will be able to do so if certain additional conditions apply; that is, time-limiting the flexible working pattern. The meeting between both parties will provide the opportunity to explore alternatives to find a solution that is acceptable to both parties. In circumstances where an alternative approach has been found that is agreeable to both parties, it will be essential that the employer's letter confirming his decision sets out the basis on which the application is agreed.

Amendment No. 244 seeks to place the qualifying period of 26 weeks' continuous employment in the primary legislation. The noble Baroness asked us to say what we have in mind. Again, I assure the Committee that it is the Government's intention to keep to the Work and Parents Taskforce recommendations and limit the right to apply for flexible working to employees who have been employed for a continuous period of 26 weeks. That will be achieved by using the regulatory power provided for at new Section 80F(8)(a)(i). This period will be consistent with the qualifying periods for adoption leave and paternity leave, which are also being implemented through the Bill.

It is inappropriate to take the approach of setting the period in regulations rather than the approach suggested in the amendment. It ensures the long-term flexibility of the legislation should there ever be a case for amending the qualifying period, whether up or down.

The purpose of Amendment No. 246, which the noble Baroness wishes to add to the end of new Section 80F, is to limit the number of requests that a parent may make to one a year, irrespective of the number of children that he or she may have. As the noble Baroness has already pointed out, subsection (4) of new Section 80F already covers that point. Section 80F(4) reads: If an employee has made an application under this section, he may not make a further application under this section to the same employer before the end of the period of twelve months beginning with the date on which the previous application was made". Those words seem plain and unambiguous. I reassure the noble Baroness that the text of new Section 80F(4) has been drafted to ensure the limit is not affected by the number of children a parent may have. Whether a parent has one child or four, they will be able to make only one request a year.

The Work and Parents Taskforce went to a great deal of effort to find a test that could be agreed by all sides. The consensus, reached after much debate, was that it is not appropriate to ask the tribunal to second-guess fine business judgments that are made by employers in the light of day-to-day business conditions. The task force decided that decisions on whether a particular flexible working pattern could be accommodated within their business must be left to employers to make and justify.

The effect of Amendment No. 247 would be to introduce a test of reasonableness against the grounds chosen by the employer to refuse a request. This would open up to question whether the employers' decision was or was not reasonable in the light of the circumstances. Whether such a test is necessary is something that the Government will look at when they review this flexible working provision three years after it comes into force. I do not believe that it is right to consider introducing an additional reasonableness test now, when the task force concluded that the legislation, at this initial stage, would work without it.

Employers were concerned that their reasons for declining a request should not be open to examination by a tribunal. Where an employer is unable to accept a request, he will have to specify a sound business ground. To ensure that the business ground is acceptable, it must be one of those provided under new Section 80G(1)(b)of the clause. In addition, when confirming their decision in their letter to the employee, they must also provide a sufficient explanation of why the business ground applies in the circumstances. The role of the tribunal will be to ensure that the procedure has been correctly followed, that a clear business ground has been provided and to consider any disputed facts provided in the rationale to explain why the business ground applies. It will not have a power to suggest that another business ground would be more appropriate.

Amendments Nos. 248 to 251 relate to the business grounds on which an employer may refuse a request and which are specified in new Section 80G(1)(b).

Amendment No. 248 would result in the business ground of, the burden of additional costs", being replaced with "material additional costs". The use of the phrase, "the burden of additional costs" is quite self-explanatory and I cannot see the value in what the suggested amendment would add.

It is important to lay the emphasis on the "burden" of additional costs to the employer. Any request will incur a cost in management time alone. However, just because there is a cost should not automatically provide a reason for refusing a case.

The relative value of implementing a request is also likely to vary between large and small employers. Large employers are likely to have greater flexibility to accommodate a request and thus minimise the cost. That may not be so for a small employer handling a similar request. The use of the word "burden" ensures that those circumstances are covered.

Equally, I struggle to see what can be gained by replacing the word "staff" with "employees" in the business reason of the, inability to re-organise work among existing staff". If we use the word "employee", that will lead to additional work for employers and maybe even some degree of confusion, as they will need to distinguish who among their staff has employee status within the meaning of the Employment Rights Act, where "employee" is used to refer to those individuals who have a contract of employment and those who do not.

By referring to "staff' in the legislation, one ensures that all the individuals working for a business are taken into account when an employer considers a request for flexible work. The use of the word "staff" will, for example, encompass contractors—whether self-employed or not—consultants and agency workers, to name but a few. These would not be taken into account if the business grounds referred merely to "employees".

It is possible that the majority of the workforce of a business or one of its departments have worker status. It would not be fair towards the employee making the request to exclude those individuals from the count.

The same arguments apply to Amendment No. 250, which would change the ground, inability to recruit additional staff", to, inability to recruit additional employees of similar capability on similar terms and conditions". The word "staff" avoids the dangers I previously explained about using "employees".

Neither do I think that it is appropriate to say that the person should be replaced by someone employed on similar terms and conditions. For example, if a manager applies to leave one hour earlier each day to pick up his child from school and he does two hours of administration a day, the employer may decide to get an administrative assistant in for one hour each day to cover the manager's absence.

I am also not convinced that adding "incompatibility with" to the business reason. "planned structural changes" provides any added value. This is clearly implied, because an employer is never to decline a request on the basis that a flexible working pattern is compatible with a planned structural change.

Amendment No. 253 would give the Secretary of State power to make regulations to allow the employer to be accompanied to a meeting with an employee to discuss flexible working by an official or representative of an organisation of which the employer is a member.

This right could be exercised only where the employee has exercised his right to be accompanied to the meeting.

The idea that the Government should make regulations to tell an employer that they could invite someone to a meeting organised by them is an interesting proposition because the idea that they could not to do so is a breach of human rights legislation. Also, while tempting, it is not one that I believe the Government should pursue.

We have to make regulations about who may accompany employees to such meetings because experience teaches us that employers may seek to exclude individuals external to their own operation—or even internal—from meetings of this kind.

There is no need to do the same for employers. If an employer wants to invite a representative of their local chamber of commerce, of the Federation of Small Businesses or the CBI, for example, to a meeting organised by him, on his premises, there is nothing in the Bill to stop him from doing so.

Has the noble Baroness thought about what should happen in the circumstances in which the employee chooses not to be represented? The effect of this amendment would prevent employers from having the option of inviting someone of their choice in such circumstances—at least, not without the consent of the employee. I do not believe that that would be helpful to employers or that it is what the noble Baroness intends.

Amendment No. 254 would enable an employer to reduce the benefits paid to an employee if they reduce their working hours. The benefit would be reduced pro rata to the hours worked or, if the benefit cannot be divided, it could be replaced by a cash payment that is equivalent to the value of the benefits before the hours were reduced.

The task force recognised that if hours are reduced, pay and other benefits are likely to need to be reduced, too. It is much more straightforward to reduce pay. As we found in earlier sittings, defining—let alone dividing—a benefit can be much more difficult. However, employers already do that. The Part-time Workers (Prevention of Less Favourable Treatment) Regulations 2000 require that part-time workers cannot be treated less favourably than a full-time worker as regards the terms of his contract. Under these regulations, employers are already used to making contractual rights available to those working fewer hours than full-timers on a pro-rata basis. Where they cannot "pro rata" a benefit, the regulations do not prevent the employer, if they wish, to offering payment in lieu.

The consequences of changes in the employee's terms will be provided for, expressly or by implication, in the employee's contract. If a contract provides a rate of pay per hour, obviously less will be due if fewer hours are worked. If a contract provides for benefits if particular criteria are met, what will have to be determined is whether the employee's new terms are consistent with the criteria.

There is nothing in law, therefore, that stops an employer doing what the amendment seeks to give him permission to do. This is clearly something that needs to be stressed in any guidance that is offered on the legislation. I can undertake that we will make sure that that is done.

Amendments Nos. 255 and 256 are extremely similar. They concern the same line of text within the clause. Amendment No. 255 differs from Amendment No. 256 because it adds of a couple of extra words. The noble Baroness asked that Amendment No. 255 should be debated separately while Amendment No. 256 should be included within this grouping. My following comments on Amendment No. 256 will apply equally to Amendment No. 255.

Amendment No. 256, like Amendment No. 255, would add the word "materially" to the provision. The basis of the employee's challenge of the rejection of their application for flexible working would therefore be on materially incorrect facts.

The amendments have to be looked at against the background of the recognition by the Work and Parents Taskforce that all efforts should be made to resolve a disputed request at the workplace. Dialogue between both parties, for instance, is encouraged throughout the procedure that the employee must follow when considering a request. This approach is continued at appeal, which provides a further opportunity to see whether a solution can he found that is acceptable to both parties.

Hence, an employee will only be able to take his or her case to a tribunal where the employer has failed to follow the procedure correctly or, having followed the procedure, the facts on which the employer has made his decisions are disputed.

In any event, the provision as currently drafted delivers what the taskforce wants, and what I believe the noble Baroness wants too. If the employer has based his decision, as the provisions say, on incorrect facts, we are entitled to let the employee conclude without further thought that the facts are material to that decision. To add the word "materially" would simply add unnecessary uncertainty.

Equally, it is fair to say that if an incorrect fact led the employer to refuse a decision, it can be assumed that it was substantial to the decision made. To include the word "substantially" also adds unnecessary confusion.

The initial hearing, the employer's explanation of the business grounds on which he has based his decision and the appeal meeting should have provided adequate opportunity to make clear to the employee the facts on which the employer based his decision . To subject any of these facts to further tests would be unnecessary. How can any of these facts not be material to the decision or substantial to the basis for the decision?

This new right of flexibility will encourage both parties to consider flexible working patterns that suit them both. The mechanism provided here will enable employers and parents to begin to explore solutions together. The approach is based on existing best practice, promotes dialogue throughout the process, and encourages both parties to think about alternative solutions. They will contribute to increased productivity and help to make working parents' lives easier and benefit their children.

In the light of the background and explanations that I have provided to the areas where amendments have been tabled, I ask the noble Baroness to withdraw the amendment.

Lord McCarthy

Perhaps I may ask the Minister some questions which came to me when he announced that he intends move an amendment on Report to take the Armed Forces out of the effect of Clause 47.

First, I wonder how they got in there and why they are coming out now. Did they get in there because the flexible working and the Work and Parents Taskforce suggested that they should be included in there? If so, have the Government been back to the task force and asked it whether it thinks they ought to come out?

Secondly, it was not really explained, which may be difficult or embarrassing, why the Armed Forces are in some way covered. Is it that they might end up in employment tribunals asking for sanctions, which is something they could not normally do? Is that what it is about? In which case, why did the provision go in in the first place? And if it is to be taken out, what is the parallel procedure? The Minister said something, which I did not quite follow, about there being something which would not be on the face of the Bill but it would be somewhere in practice in relation to the Armed Forces. What would that be like and what would the sanctions be in that case?

Finally, is this merely an exclusion of the Armed Forces themselves? What about all the civilians who work for the Armed Forces—will they be excluded too? Those are the questions that come to my mind.

4.30 p.m.

Lord Sainsbury of Turville

Perhaps I may deal with those points first. The Work and Parents Taskforce report recommended that the right to request flexible working should apply as universally as possible, and that approach has been taken. This amendment has been seen to come subsequently because the Armed Forces work under unique conditions. It is right that the Government should recognise this.

We were not able to make the amendment any sooner, because we wanted to ensure that no other options were available. The task force has been told about the Armed Forces exemption and has raised no concerns about it.

Lord Wedderburn of Charlton

Before my noble friend leaves the clause, can he say something about the other of his most important announcements as to what the Government intend to do in amending the clause? I refer to his announcement of the extension of the arbitration scheme which ACAS was required to draw up and which has been in existence for some time now, which entails, where the parties opt for it, the exclusion of a right of access to employment tribunals.

Now, plainly, he and his advisers must have looked with great care into this extension, so important is the scheme. Can the Minister tell us what grounds there are for having confidence in the scheme so far to the extent of extending it to this area? How many employers and employees have opted for the scheme so far and is it not the case that very little confidence has been generated in the scheme with its exclusion of right of access to tribunals? Of course he may say that there is a limit to the time in which it has been in existence, but the time has been sufficient, surely, to make a judgment. What were the grounds for the Government thinking that success had been sufficient to extend it?

Lord Sainsbury of Turville

The simple answer is that there have been only 14 cases so far. There has been limited take up and it is probably too early to assess the success or otherwise of the scheme. Equally, it gives people another area of choice and it is difficult to see why they should not have that additional choice included here.

Baroness Miller of Hendon

The Minister did very well in following my long list of 15 amendments—in fact better than I did. Listening to his answers, I got lost somewhere in the middle. Therefore, I think that the best thing for me to do is to beg leave to withdraw the amendment and read carefully what the Minister said in Hansard tomorrow.

Amendment, by leave, withdrawn.

[Amendments Nos. 240 to 251 not moved.]

Baroness Miller of Hendon

moved Amendment No. 252: Page 53, line 30, leave out from "a" to end of line 31 and insert "fellow employee or a representative of a recognised trade union The noble Baroness said: Amendment No. 252 seeks to alter paragraph (k) of the list of 14 items that the Secretary of State is to include in regulations about the employer's duties in relation to an application to vary the employee's contract.

Subsection (2) begins with the preamble: Regulations under subsection (1)(a) shall include", and then, (a) provision for the holding of a meeting between the employer and the employee", and, (g) provision for the holding…of a meeting between the employer and employee to discuss the appeal from a decision of the employer. Paragraph (k), which the amendment seeks to amend, requires, not merely permits, the Secretary of State to include in the regulations: for the employee to have the right to be accompanied at meetings under paragraph (a) and (g) by a person of such description as the regulations may specify". It is the words, person of such description as the regulations may specify that I wish to see removed and replaced by, a fellow employee or the representative of a recognised trade union". I have two questions for the Minister.

First, apart from a fellow employee or a trade union representative, who does the Secretary of State consider that she might wish to specify in these regulations? If there is some other category, there is no reason why that should not be specified clearly in the Act.

Before the Minister tells us that the paragraph is intended simply to give flexibility, I come to my second question. Section 10 of the Employment Relations Act 1999 describes, according to the marginal note, the employee's right to be accompanied at disciplinary or grievance proceedings. Subsections (2) and (3) of that section state that the employer must permit the worker to be accompanied at the hearing by a single person, chosen by the worker, who is: employed by a trade union of which he is an official within the meaning of sections 1 and 119 of the Trade Union and Labour Relations (Consolidation) Act 1992…[or is] an official of a trade union…whom the union has reasonably certified in writing as having experience of, or as having received training in, acting as a worker's companion at disciplinary or grievance hearings, or [is]…aother of the employer's workers". Those are the Government's words as set out in their own Act passed three years ago. The Minister may intend to use the epithets "specifically", "prescriptively", "inflexibly" or another such word in relation to any amendments that I propose that are intended to tie down the Government to a specific course of action sanctioned by primary legislation and not by ministerial decree.

My second question is: if it was good enough for the former Secretary of State to specify in the 1999 Act the qualifications of the employee's companion at a proceedings, why will the present Secretary of State not do so in the present Bill?

I have a third supplementary question for the Minister. If the Secretary of State is seriously contemplating at present or possibly in the future any difference from the 1999 Act's description of who the employee's representative should be when he attends such proceedings, what possible advantage is there in making such a change? Indeed, what justification is there in creating a possible inconsistency between the two Acts? That matter causes me some concern. I beg to move.

Lord Sainsbury of Turville

The amendment would limit the people who can accompany the applicant at relevant meetings with the employer to a fellow employee or a representative of a recognised trade union. Basically, we have followed the task-force approach in relation to this matter. The task force considered it important that employees, who may be at a disadvantage in discussions about their application to work flexibly, should have the right to be accompanied if they wished.

Because flexible working is a relatively new area, the task force did not want unduly to limit the people who could accompany the parent making the request. The noble Baroness asked who else might be invited to come along. The parent, for example, might know someone who has expertise to accommodate flexible working in innovative ways and who might he able to make a real difference to the consideration of a case for flexible working.

That is why the task force suggested in its report that parents should have the right to be accompanied by, a fellow employee, friend or recognised trade union representative". In those circumstances, it seems to me perfectly reasonable to ask to bring along a friend. I would be the first to admit that as it is different from the right to be accompanied in disciplinary or grievance hearings under the Employment Relations Act 1999. Indeed, I take the noble Baroness's point that it might cause some confusion.

Equally, I fully understand why the task force was trying to find a wider formula to encompass the type of expertise that I have already mentioned. In addition, the discussions under these new provisions are manifestly not disciplinary or grievance hearings. That is why one cannot make an exact comparison with the Employment Relations Act 1999.

In the light of that, the Government consider- that the best route is to set out in draft regulations who should be allowed to accompany the parent. That would allow further consultation to take place. I intend the consultation to be wide in order to allow the issues of consistency versus wider expertise to he explored fully. I hope that that explanation provides a good reason as to why the amendment is unnecessary.

Lord Wedderburn of Charlton

Before my noble friend sits down, or if he is still in semi-levitation, perhaps I may ask him whether I heard him aright. He said that the regulations will allow a friend to accompany the applicant. In these parental considerations, that is very understandable. But did I understand him to say that they will be limited to representatives of recognised trade unions? That, of course, is not the case in relation to Section 10. The amendment would impose a new limitation which, apart from CAC procedures of recognition, would give the employer a veto by refusing recognition to particular trade unions. Section 10 does not allow for that. Perhaps I heard him wrongly. Did he say that?

Lord Sainsbury of Turville

No, I should have made it clear that I was quoting from the task force. It suggested in its report that parents should have the right to be accompanied by a fellow employee, friend or recognised trade union representative. However, that is what the task force said; it is not a statement of what will be in the regulations.

Baroness Turner of Camden

Am I right in assuming that a "recognised trade union representative" is not necessarily the same as a "representative of a recognised trade union"? There can be situations in which a union is busy organising the staff and has not yet been recognised. However, if the representative himself is recognised from the union, that is different from being from a recognised trade union. Is that right?

Lord Sainsbury of Turville

I am sure such points will be taken account of in the drafting of the regulations.

I was not commenting on that point. I was commenting on the question of other people being allowed to come in.

Baroness Miller of Hendon

I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 253 and 254 not moved.]

Baroness Miller of Hendon

had given notice of her intention to move Amendment No. 255: Page 54, line 9, leave out "based on" and insert "substantially based on materially The noble Baroness said: The Minister spoke to Amendment No. 255 in the large group of amendments. Under the circumstances, I shall not move it.

[Amendment No. 255 not moved.]

[Amendment No. 256 not moved.]

Baroness Miller of Hendon

moved Amendment No. 257: Page 54, line 35, at end insert— ( ) If a complaint is made to an employment tribunal and the complaint is held to be not well founded it shall be conclusively presumed that the refusal to vary the terms is not a breach of the Sex Discrimination Act 1975 (c. 65). The noble Baroness said: The amendment is designed to incorporate a fundamental principle of law that applies in most countries. In Latin, the principle is resjudicatathe matter had been adjudicated upon. In other words, there cannot be a second trial on substantially the same facts. This amendment is also designed to prevent what is called "forum shopping". If someone loses a case before one set of adjudicators on one set of grounds, she cannot be allowed a second bite of the cherry by taking the same facts to another tribunal on another alleged ground.

The amendment does not involve merely a matter of political difference between the Government and the Opposition. It simply involves a matter of whether the long-standing law of the land is to apply to the new legal system that began in the late 1940s with the rent tribunals and is now gradually evolving as the number and functions of tribunals increase in place of, or as a complement to, the regular civil courts. I beg to move.

Lord Sainsbury of Turville

The noble Baroness is suggesting that if a parent is unsuccessful in taking their case to tribunal under this right, any claim made that is under the Sex Discrimination Act 1975 will be presumed to be ill founded. That is surprising because the clause sets out a new right that is completely separate to the Sex Discrimination Act. We really should not confuse them.

It may be helpful if I explain how an application is to be considered by an employer. When an employer receives a request, they will have to follow the procedure that is outlined in the legislation. That procedure is designed to promote a positive dialogue between both parties to help them identify a flexible working pattern that suits them both. If the employer is unable to accept an application, they will have to ensure that they have a sound business reason for refusing the application and explain why it applies in the circumstances. For clarity to both parties, those business grounds are set out in the legislation.

An employment tribunal will verify that the procedure has been followed correctly and that an acceptable business ground has been given as a reason for declining the request. It will also check any disputed fact on which the business reason has been based. The tribunal will have a general power to question the employer's actual judgment.

That test, under the right to apply for flexible working, is very different from the much more onerous test of objective justification, which is used in the Sex Discrimination Act. Under the sex discrimination test, a tribunal can question the employer's reasoning.

As I hope I have now made clear, the two tests are different and there is an extremely important reason why the link that the noble Baroness proposes should not be pursued. Sadly, experience shows that some employers continue to discriminate on the basis of sex. It may be that an employer is able to comply with the procedure under the right to request and provide a business ground but still reach their decision on a discriminatory basis. For example, an employer may decide that he will refuse all requests from men irrespective of the strength of their case and ensure that he is able to show that he has not acted in breach of the right to request. However, the employee will still be able to bring a successful sex discrimination claim if he can show that the employer made a decision on a discriminatory basis.

If an employer sexually discriminates against any employee, whether directly or indirectly, it is absolutely right that they should suffer the penalties that are provided for in the Sex Discrimination Act.

I should add that there is another reason why this amendment is unworkable. Individuals often bring two different claims which emanate from the same facts together—indeed, the tribunal also has power to join them. It will therefore be possible to bring claims under both this right and sex discrimination legislation at the same time.

To accommodate the amendment, additional provisions would have to be made to ensure that the decision on the "right to request" claim was made before the sex discrimination claim decision or the amendment would have no effect. That would lead to the absurd and unjust situation whereby a tribunal could hear evidence of blatant discrimination and has to make a decision that there was no discrimination only because the right to request had not been breached. For those reasons, I ask the noble Baroness to withdraw the amendment.

Baroness Miller of Hendon

I thank the Minister for his clear reply. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

4.45 p.m.

[Amendments Nos. 258 and 259 not moved.]

Clause 47 agreed to.

Clause 48 [Rate of maternity allowance]:

[Amendment No. 260 not moved.]

Clause 48 agreed to.

Clause 49 [Work focused interviews for partners]:

Baroness Turner of Camden

moved Amendment No. 261: Page 56, line 31, at end insert "in relation to jobs which are suitable for that person The noble Baroness said: We now come to Clause 49. This section of the Bill contains a requirement for a partner to attend what is known as a work-focused interview. As I understand it, the Bill will give Jobcentre staff full discretion in deciding whether or not a partner should attend for such an interview. I am concerned that that could result in people being called in for interview in inappropriate circumstances, despite what is said in the Explanatory Notes.

The range of benefits within the clause not only includes income support and jobseeker's allowance but also incapacity benefit, severe disablement allowance and invalid care allowance. That suggests that some partners of people in receipt of benefits as carers and as disabled people will be expected to attend for an interview or face possible loss of benefit. Women at home with children may come under pressure at an interview, which in itself could be difficult to attend.

An assumption that an unemployed partner could look after children might not be correct. NACAB has expressed some concern about the proposals. It says that the current administration of sanctions against people who fail to attend a training course or take a job raises doubts about what would happen in practice. It has given me a number of examples of what has happened in the implementation of those regulations.

It is true that the Explanatory Notes specifically state that the interviews will concentrate on job potential and provide the partner with access to a wide range of help and information on work, benefits and services, such as child care. It states that it is intended to encourage partners towards labour market participation. However, any action that they may choose to take beyond taking part in the interview is claimed to be entirely voluntary. However, the mere fact of having to attend an interview, with the possible loss of benefits as a threat in the background should the interview not be attended, may of itself bring pressure on an individual. It could also lead to assumed pressure being placed on an individual to accept employment that is not suitable to background training or general circumstances. Our amendment seeks to deal with that.

This is a probing amendment and I would welcome the Minister's reaction. It seems that the officials who will be responsible for implementing this section of the Bill will need to have careful and sensitive training because they will be dealing in the main with people who are extremely vulnerable. After all, the better off do not generally have to be involved with any aspect of social security. I beg to move.

Baroness Miller of Hendon

At Second Reading f did not like this clause. I thought that the idea of making partners come for interviews—especially as it appears as though they are not forced to take a job—appears to put pressure on them beforehand. It was totally unnecessary and I am amazed with myself that I did not bring back an amendment. The noble Baroness's amendment certainly makes it better, but that does not mean that I like the clause any more.

Lord Sharman

I, too, do not like the clause. I have tabled Amendment No. 262 but I support everything that the noble Baroness, Lady Turner, said about what is wrong with the clause. I seek the same clarifications.

Lord McCarthy

Where is the pressure intended to be placed? Presumably, the partner is being brought along to the interview because it helps to put pressure on one of them or both of them to go out and get a job. Is the pressure on the claimant of benefit, on the partner of the claimant or on both of them? If the pressure is on either of them, is there any research-based evidence that there is abuse?

Lord Bassam of Brighton

I want to pick up that point. At the outset, my understanding is that the arrangement is not about putting pressure on either the claimant or their partner. Essentially, the measure is there to be helpful. In explaining the Government's thinking, I should be able to demonstrate that.

The amendments will prevent partners of recipients of certain benefits from being required to take part in work-focused interviews, unless there are jobs that are suitable for them. That, in itself, is an important point on which to focus. Clearly, it is only right that in some circumstances—in most circumstances—one would hope that any work that was available for the partner would be suitable. It is of course important to be able to find out what that work might be.

In essence, the amendment would mean that we would not be able to require partners to take part in interviews if there were no suitable jobs for them. Work-focused interviews support the Government's objective of promoting work as the best form of welfare, by providing everyone of working age with the opportunity of finding out about the help that is available to them to find work.

The purpose of the interview is not simply to discuss specific jobs or to look at each job that might be available; it is to explore with the individual their potential for work and to advise them about the wide range of help and information on the benefits and services that are available to them to help them to get into work. It is there to assist, help, advise and guide them about what they might want to do in the future.

The interview will provide a personal and tailored approach and it is intended to encourage partners to take steps towards labour market participation by exploring ways in which they can overcome any barriers that might exist to prevent them from looking for work.

I accept that, depending on their circumstances, some jobs may not be suitable for those individuals. We want to treat people as individuals and we do not want to restrict the jobs that may be considered suitable for any individual. That is precisely why the work-focused interview will be an opportunity for them to discuss the type of work that they may be able to do and learn about the help, services and benefits that are available to help them.

The discussion—it will be a discussion—may well result in a person realising that their skills and experience mean that they may be able now, or perhaps at some point in the future, to do a wider range of jobs than was initially thought. For some partners, work may be entirely inappropriate at the time that they are required to attend the interview. However, they should not be written-off or cast out of the labour market. They may wish to work at some point in the future. The purpose of the interview is to keep them in touch with the world of work and the opportunities that it might provide for them.

We believe that it is right that people take part in those interviews and are made aware of the help that is available so that they are aware of the options that are open to them at the time of the interview and at some future date. Whether or not partners are in a position to work, no other requirement will be placed upon them apart from taking part in the work—focused interview. Any action that a partner may choose to take beyond taking part in an interview—for example, finding work or joining a New Deal programme—will be entirely voluntary. Therefore, he will not be forced, cajoled or pushed into work. A partner who wishes to take up the offer of help to find a job will be asked to attend a further interview. That appears to make sense. It follows on if we are trying to advise and help, and we believe that it is right. It will provide time for people to concentrate on discussing specific jobs that might be suitable for the partner.

I hope that Members of the Committee will be pleased to know that a system of safeguards will be built into the process to ensure that people do not lose benefit where the circumstances of the individual mean that the timing of the interview may not be beneficial or where the partner has no reasonable prospects of working. An adviser will be able to defer or waive a meeting where it would be inappropriate for a partner to have a discussion in particular circumstances or at a particular time.

I do not believe that taking part in an interview is an onerous or unreasonable requirement. We are asking only that partners come to discuss their situations and their work aspirations with an adviser—that is, someone with expertise—so that they may be made aware of the practical and financial help that is on offer. There will be no absolute requirement to seek work under this measure.

That is the Government's intention and our reasoning for introducing the measure. I hope that it offers a large measure of reassurance. It is not seen as a coercive approach by the department; rather, it is a facilitative measure to enable and to help and to ensure that the partner is kept in touch with the world of work if that is what he or she wants. There is no pressure or inducement to that end. We are simply attempting to be helpful to the partner.

Baroness Turner of Camden

Before the noble Lord sits down, he says that the measure is not intended to be coercive, but would people lose benefit? In particular, would a person in receipt of severe disablement allowance, which one receives only if one is severely disabled, lose benefit if he failed to show up for an interview? That is one of our concerns. People are likely to lose a whole list of benefits if they do not show up, and that is the pressure about which we are all concerned.

Lord Bassam of Brighton

I take my noble friend's point. Ultimately, that sanction has existed in legislation for a long time but it must be borne in mind that it is very rarely used.

Three opportunities are provided for attendance at an interview. The interview will not ultimately have to take place in an office. The adviser may well suggest that it takes place in the partner's home if that is more appropriate. The work-focused interview will be operated with extreme sensitivity. It is all about assistance and help. It is about keeping in touch with people and enabling them to make contact with the world of work, if that is what they want. It is not intended to bring heavy pressure or to try to force people off benefits in a coercive way into the world of work.

It is worth adding that the sanction does not cover all benefit. It covers only 20 per cent of the single person rate, which amounts to approximately £10.79. Therefore, it is not as though the whole benefit will be taken away. It is a partial withdrawal and one that is used only very much as a last resort.

Lord Wedderburn of Charlton

Before my noble friend departs from, with great respect, those very bad points, the fact that a sanction is bad is not reconciled for me by the fact that it is rarely used. That is irrelevant. If it is bad, it is bad. My noble friend said that the sanction would cover only about 20 per cent and not the whole benefit. But these are very vulnerable people.

However, I want to congratulate my noble friend since this is perhaps the last major amendment that we shall debate. He deserves a prize because throughout this Grand Committee there has been a competition between my noble friends the Ministers and the Bill. My noble friends the Ministers have regularly proved that they are more sensitive, more civilised and more scrupulous than the Bill. Each time we have asked why something should not be put in the Bill, they have said, "That is not what we mean at all but, of course, we cannot put it in the Bill". I understood that Ministers are not allowed to do so but that they do not want that to happen. My noble friend Lord Sainsbury will remember saying he did not want this kind of thing to happen. Also my noble friend in his exposition should receive a top prize, perhaps a trip around the world, or some suitable prize in the competition between the Ministers and the Bill.

This is a serious point because in looking at Report the Government should pay more attention to their civilised Ministers than to their uncivilised draftsmen of the Bill. The Government should look at my noble friend's speech very carefully and see whether they cannot perhaps give an inkling in the clause that these vulnerable people will not feel that they were being pressured to take unsuitable jobs.

My noble friend says they will not be pressed or coerced to take unsuitable jobs. I do not see even a hint of that in the Bill. It may be that those who administer this scheme are always sufficiently sensitive not to have that effect. I believe the history of social security administration does not show that we can be absolutely confident that that is always the case. Social security is something where individuals sometimes suffer from their vulnerability and feel coerced, and that will happen here in some cases.

Some inkling of my noble friend's civilised approach should surely appear not just in regulations, of which we know not at this stage, but in the Bill itself. Let the Government pay heed to their Ministers and come back on Report with a number of amendments that the things Ministers have said they want can be at least suggested in the Bill.

5 p.m.

Baroness Turner of Camden

I noted what the Minister had to say and I am not at all happy about it. I still believe that the Bill as it stands contains a coercive element. It has been explained very clearly by my noble friend Lord. Wedderburn how my noble friends and I feel about this provision in the Bill. This is something to which we will certainly return on Report. I am not at all satisfied with the response that has been given this afternoon, but in the meantime I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Sharman

moved Amendment No. 262: Page 56, line 38, leave out paragraphs (c) to (e). The noble Lord said: The purpose of this amendment was very substantially the same as that of Amendment No. 261 moved by the noble Baroness, Lady Turner. Having heard the debate and the Minister's reply—which left me, too, very dissatisfied—I wish to return to it on Report. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 49 agreed to.

Clause 50 agreed to.

Schedule 6 agreed to.

Clause 51 agreed to.

[Amendment No. 262A not moved.]

Clauses 52 and 53 agreed to.

Schedule 7 [Minor and consequential amendments]:

Baroness Miller of Hendon

moved Amendment No. 263: Page 80, line 15, at end insert— ( ) In section 23(5), the words "or otherwise" are omitted. The noble Baroness said: In congratulating the Minister on what was happening in respect of the Bill, the noble Lord, Lord Wedderburn, said that in his opinion that was the last major amendment which would be debated tonight. Although my amendment is very short, I believe it is very important. Indeed, I hope the noble Lord, Lord Wedderburn, might afterwards agree with me on that, even if he does not agree with the amendment.

This small amendment would remove two totally redundant words from Section 23(5) of the Employment Relations Act 1999. The Government themselves are amending an earlier subsection in Section 23. Section 23 is entitled, Power to confer rights on individuals", and subsection (5) states: An order under this section may make provision in such way as the Secretary of State thinks fit, whether by amending Acts or instruments, or otherwise". The two words, "or otherwise", are the subject of this amendment.

On 4th December 2001, at Question Time, I asked the Minister—I apologise for quoting myself: Can the Minister tell the House what the word 'otherwise' means in this context? Does it mean that the Secretary of State would be able to bypass Acts of Parliament or statutory instruments?".—[Official Report, 4/12/01; col. 702.] In his reply, the Minister said, I am sure that this point was debated at great length between the noble Baroness and myself—when the Bill passed through this House. However, I cannot remember exactly what 'otherwise' referred to", and he undertook to write to me on the subject.

First, I congratulate the Minister on his usual frankness in admitting that he had no more idea of what "or otherwise" meant than I did. However, his researches into the debates in your Lordships' House and in the other place will have revealed, as did mine, that the topic was never raised. I will mention that again later. Secondly, I thank him for having honoured his promise to write to me to explain what "otherwise" meant.

I would now like to read to the Committee the substantive part of his reply, which I quote verbatim so that Members of the Committee get the full flavour of it. He wrote: The use of the words 'or otherwise' were:intended to ensure that an order made under section 23 could also apply rights to individuals by means of a 'free standing' provision rather than by an amendment". He continued: This was simply to give the Secretary of State the flexibility to extend rights in the way that seemed best from a drafting point of view. The words do not extend her powers in any way". Well, in so far as I can make head or tail of that reply, the Minister was saying that the words are to enable the Secretary of State to alter an Act of Parliament or a statutory instrument not by another Act of Parliament or by another piece of secondary legislation—so far as I know, those are the only two constitutional ways to amend the law—but by what he now euphemistically calls a free-standing provision. What on earth is "a free-standing provision"? What new legislative device have the Government invented to circumvent Parliament?

Cutting through the jargon, it is perfectly clear that the words "or otherwise" mean that the Secretary of State is seeking the power to amend legislation by some means other than by primary or secondary legislation. In other words, the phrase "or otherwise" is either a piece of unnecessary verbosity or there is some significance in it. In so far as the words mean anything—despite the noble Lord's assurance to me that they do not extend the Secretary of State's power—I regret that I do not agree with him. If the Secretary of State can amend the legislation by an Act of Parliament or by statutory instrument, or otherwise, then "otherwise" has got to mean something. Perhaps it means that she could do so by stroke of the pen, by putting an announcement in the London Gazette or some other obscure local paper or even by sending out leaflets to be distributed by sandwich-board men parading along Whitehall.

This is not a trivial matter. The provision, if left unaltered, would set a dangerous constitutional precedent that Parliament should not accept. I apologise for the fact that I did not pick up this point during the passage of the Employment Relations Act, but toiling alone as I do in this House, amidst a welter of never-ending DTI legislation, I certainly cannot catch everything that comes my way, but it is far better late than never. I beg to move.

Lord Sainsbury of Turville

With all respect to the amendment tabled by the noble Baroness, Lady Miller, which we take very seriously, the lengthy debate on this Bill is liable to end with a whimper rather than a bang on this basis. The measure is very simple. All it means is that you can introduce a new regulation without having to amend another regulation—you can introduce a freestanding regulation without amending a regulation.

The noble Baroness's amendment would simply take away the current flexibility for the Secretary of State to extend rights in a way that is best from a drafting point of view. I assure the Committee that the words currently used in the Bill do not extend the Secretary of State's power in any substantive way. On that basis I am unable to convince myself that this important point would materially improve the Bill and I ask the noble Baroness once again, and finally, to withdraw the amendment.

Baroness Miller of Hendon

I do not know about once again and finally, I think that this is the first time that the Minister has asked me this evening. Does he mean to withdraw the amendment?

Lord Sainsbury of Turville

Yes, to withdraw the amendment.

Baroness Miller of Hendon

If the term "or otherwise" simply means another regulation to amend a regulation, that should be in a definition clause of what "or otherwise" means. However, it is not. It could be interpreted in any way that any Secretary of State chooses. The Minister referred to introducing another regulation. That should be on the face of the Bill, or there should be a definition of "or otherwise". Of course I have no choice but to withdraw the amendment, but I shall certainly look at it again and I hope that the Minister will also do so. We seem to have been having a nice little debate about this matter, but it is serious. I do not wish to leave those powers unfettered as it were in the hands of anybody to use in a way that might not be appropriate. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Schedule 7 agreed to. Clause 54 agreed to.

Schedule 8 agreed to.

Clause 55 agreed to.

In the Title:

[Amendment No. 264 not moved.]

Bill reported with amendments.

The Committee adjourned at fourteen minutes past five o'clock.