EMPLOYMENT PROTECTION BILL

HL Deb 14 October 1975 vol 364 cc780-867

3.8 p.m.

Lord JACQUES

My Lords, I beg to move that this Bill be now further considered on Report.

Moved, That the Bill be further considered on Report.—(Lord Jacques.)

On Question, Motion agreed to.

Clause 109 [Excluded classes of employment]:

Baroness ELLES moved Amendment No. 71 A:

Page 92, line 20, leave out subsection (7) and insert— (7) The following provisions of this Act do not apply to employment under a contract for a fixed term of 12 weeks or less or to employment under a contract made in contemplation of the performance of a specific task which is not expected to last for more than 12 weeks, unless in either case the employee has been continuously employed for a period of more than 12 weeks that is to say, section 22 and 29.M ( ) The following provisions of this Act do not apply to employment under a contract for a fixed term of 12 weeks or less or to employment under a contract in contemplation of the performance of a specific task where that employment was undertaken in the knowledge that it would terminate upon completion of that task unless the employment is terminated by the employer prior to the completion of that task, that is to say, sections 90, 91 and 93.

The noble Baroness said: My Lords, as your Lordships will see from the Amendment, Clause 109(7) remains practically as it was already drafted except for the omission of reference to Clauses 90, 91 and 93; that is, those clauses dealing with redundancy payments. The Amendment which we are proposing, and which we hope the Government will accept, concerns the special difficulties of the construction industry relating to the requirement to consult trade union representatives prior to the dismissal of employees as redundant. Clause 90(8) provides for a plea of special circumstances which an employer can use as a defence when appearing before a tribunal for non-compliance. However, the categories of employee in the construction industry cannot be considered to fall within the definition of special circumstances. It is the very nature of their work that we are asking to be considered in this Amendment.

Employers in the construction industry may be broadly divided into two categories. The first consists of the so-called "travelling men"—the construction workers engaged by a firm on a permanent contract of employment. They travel to one site and work there until their part of the job is finished, and they then move on to another construction site with the same employer. But the other category of employee which is our concern in this Amendment is the more traditional site worker, the so-called "local man", engaged by a particular construction firm to undertake a particular job on one construction site only. Their engagement is for that specific task, and when it is over their employment comes to an end and they then seek new work.

The pattern of work in the industry as between travelling men and local men has been changing. We accept this, but there is still scope in the industry for both groups. While some construction workers prefer the security of permanent employment as travelling men, others prefer to remain local men and to seek new work when their contract of employment is over. But the Bill's provisions on consultation before redundancy make the continuation of the employment of local men extremely difficult, and the real difficulty about consultations before redundancy arises with these local men. There is an inevitable uncertainty about work on construction sites. Weather conditions can have a major effect in delaying progress or making it faster; and so, too, can other factors, such as the availability of men, materials or machinery.

It will be clear to those who have been involved in any way with the construction industry that employers of local men cannot consult their union representatives 90 days in advance of redundancy, because the employers themselves cannot know 90 days ahead which employees will have completed their task. I think it is not correct to say that this will be unfair to local men, because this is an aspect of construction work which is accepted by those who prefer to retain the ability to choose when they work provided they remain in their home town; and I think it will be accepted that the wages paid to these men reflect what might to some extent be termed their ad hoc employment.

The proposed Amendment would bring the Bill into line with the EEC Directive, and in particular I should like to refer to section 2, paragraph (a), of the Directive, which says that the Directive shall not apply to collective redundancies effected under contracts of employment concluded for limited periods of time or for specific tasks". I think that this Amendment would safely fall within that definition. I have been shown a letter from the Minister of State to the Engineering Employers' Federation, to the effect that if some Amendment could be proposed which would fall within the terms of the Directive it might be possible for the Government to accept such Amendment. So, my Lords, I hope that this Amendment, No. 71A, will be acceptable to the Government. I beg to move.

Lord SHEPHERD

My Lords, there have been a number of discussions in regard to this matter between the industry and the Ministers at the Department of Employment. I am sure that the noble Baroness will agree that if this matter had been considered, as perhaps it ought to have been considered (and in my view should have been considered), at the meeting of the Economic and Social Committee at which the CBI, the representatives of the employers, were present, when the Directive was being formulated and before it went to the Council of Ministers, many of the difficulties which the noble Baroness has referred to could have been avoided. It is true that complete exemption is not possible under the terms of the Directive, but the noble Baroness is right when she says that the particulars in the Amendment are to be found within the Directive. But, my Lords, we are not bound to take the minimum. In earlier parts of the Bill, both in Committee and, I believe, on Report, we have agreed to go a good deal further than the Directive as it is binding upon the European Community countries, in particular in regard to the aspects relating to notification—the 90 days and the 60 days.

My difficulty—I will be frank with the noble Baroness—is that it was only yesterday that I saw this Amendment, when it was in the form of a manuscript Amendment. The first indication the Department had that this Amendment was being considered was a letter from the employers' association dated the 10th of this month. We have taken the view that as far as possible we should seek agreement between the two sides of industry before we formulate policy and make any changes. To the best of my knowledge there have been no discussions in regard to this matter between the employers' association and the appropriate trade unions. If there had been consultations, if there had been a recognition of the problems, and if there had been an agreement, I do not believe there would have been any difficulty in finding some formula to put into this legislation. But I hope the noble Baroness will see that when, at this very last moment, at the very end of the Report stage, we suddenly have an Amendment which would exclude from this important piece of legislation a very large number of employees, without there having been any form of consultation between the two sides, the Government are in very great difficulty in responding in a constructive way to the speech which she made.

We have accepted and have expressed sympathy about the difficulties of the industry in the type of labour it employs and the conditions of service under which the workers operate; but at this stage I cannot accept the Amendment for the reasons I have given. If, between now and Third Reading, the two sides of the industry were prepared to go to the Secretary of State and say that some provision ought to be made in this Bill, and if it were possible to move the necessary Amendment, then I should be very happy to do so on Third Reading; but I think it would be wrong for us to react at such a short notice from one side of the industry without taking into account the views of the other side. I would therefore say to the noble Baroness that if both sides are willing to approach the Government through the Secretary of State, then we will see what we can do to deal with it.

However, as I am sure the noble Baroness herself will be aware, Clause 98 enables the Secretary of State to exempt an industry from the provisions of the Bill where both sides of the industry jointly approach him and ask him to exempt them because they have alternative arrangements under a collective agreement which are no less adequate than those proposed in the Bill. So although we may not be able, in the time available, to find the necessary formula to put into the Bill, Clause 98 still makes it possible for exemptions to be made, on agreement by both sides, following an approach to the Secretary of State. Clause 97 also enables the Secretary of State to exempt certain classes of workers from the provisions, although the length of notice to which the trade unions are entitled may not be reduced below the minimum requirements of the EEC Directive. It is therefore still possible for the construction industry to obtain some form of exemption on a joint application.

While recognising the difficulties of the industry, I hope my approach to this Amendment is acceptable, and if the two sides are willing, in the time which is available between now and Third Reading, to come together on a joint approach to the Secretary of State, then I shall certainly see what can be done to make the necessary provision. Having said that, and even though that may not be possible between now and Third Reading, I repeat that Clause 98 still provides for exemption at a later stage, after the passing of the Bill.

Lord HAWKE

My Lords, I raised these points at the Committee stage purely by chance, but I raised them on behalf of industries which I thought would suffer; namely, the holiday hotel industry and certain types of seasonal industry, such as canning and sugar grinding. The Government reply was that they had consulted somebody or other who had decided that the 12 weeks (or whatever was the period) was quite sufficient to cover these industries. Personally, I did not believe that. I hope that in any reconsideration representatives of the industries that I have mentioned will take the opportunity of coming to the Government, as they are perhaps not represented by the CBI, and making their case at the same time.

Baroness ELLES

My Lords, in reply to the noble Lord, Lord Shepherd, I should like to make two points. The first is that from correspondence I have before me, which will be available to the noble Lord if he wishes—although, no doubt, he has copies himself—it is clear that there has been correspondence going on between the Employers' Engineering Federation and the Minister, certainly since the 3rd July. In fact, the letter from the Minister begins: "Thank you for your letter of 28th July. "This is not the first time that this matter has been raised between the Federation and the Minister himself. On a more personal basis, with regard to the Economic and Social Committee of the EEC, I think the same would apply for the European Parliament: that I, as a member of the Social Affairs and Economic Committee, was concerned with the drafting of the Collective Redundancies Directive and I must tell the noble Lord that over and over again I was hampered by not having members of the Party opposite or of the trade unions who could put their own points. I must tell the House that, as I have said over and over again, I am not in a position to come with an answer to this until I have the response of the members of the trade unions, because industrial relations will be good only when all parties agree. Whether or not the CBI were represented sufficiently on the Economic and Social Council is another matter.

My Lords, with regard to this Amendment, I do not think that Clause 8 is adequate. The construction industry do not feel that it is; and they are the people who have to work it. I should like to take up the noble Lord's offer that if the Federation and the unions concerned would get together and consult with the Minister before the Third Reading, we might be able to put it in a form more acceptable to the Minister, to the Federation and to the unions. I beg leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Clause 115 [Interpretation]:

Lord JACQUES

My Lords, Amendment No. 79 is a drafting Amendment. I beg to move.

Amendment moved— Page 100, leave out lines 20 to 23.—(Lord Jacques.)

On Question, Amendment agreed to.

3.26 p.m.

Baroness VICKERS moved Amendment No. 80:

Page 100, line 23, at end insert: ("All references to a wages council shall include the Agricultural Wages Board of England and Wales and the Agricultural Wages Board of Scotland.").

The noble Baroness said: My Lords, I beg to move Amendment No. 80. I have had the opportunity of discussing this with the Department and I realise that they feel that my Amendment is not adequate but that, if it is accepted today, they would be pleased to put it in a correct form. I am not going to say much about this, for it sets out exactly what I mean. Having read previous debates on this subject, I know that there are controversial views concerning it. I feel very strongly at the moment that the Agricultural Wages Board is not able to move towards Joint Industrial Council status and they are therefore in less privileged conditions and the regulation of wages does not work n a basis that is normal in other industries. Therefore I hope that we may debate this subject, so that I can hear the views of other noble Lords and reserve my right to test the views of the House.

Earl FERRERS

My Lords, I am grateful to my noble friend for moving her Amendment in such a generous way as to invite your Lordships to express their views. I accept the opportunity to do so, although I am bound to say that the views that I would be tempted to express might not accord with those implied in her Amendment. This Amendment places an obligation on the Agricultural Wages Board to fall into line with the Amendments which the noble Baroness has put down later, and particularly Amendment No. 89. It imposes upon the Agricultural Wages Board an obligation to put, as a minimum rate, two-thirds of the average industrial earnings. I am bound to say that, in wage negotiations, I find it difficult to think it right to compare a minimum rate with an average industrial rate; because as soon as the minimum rate increases so also does the overtime rate and so also often does the premium rate. Therefore, the mere fact of increasing the minimum rate jacks up very much more the average earnings, provided the amount of hours worked are the same. If long hours of overtime are worked, thus increasing the average earnings, that imposes an obligation to increase the minimum rate.

My Lords, I find it very hard to believe that it is correct to put an obligation upon the Agricultural Wages Board to put as its minimum two-thirds of the average industrial earnings. I also feel that, while at the moment the Agricultural Wages Board undergoes free collective bargaining between employers, employees and also with independent people, this amendment will put a statutory obligation to fix the minimum rate irrespective of the conditions of the industry and irrespective of the conditions outside.

It is true that the Amendment of the noble Baroness seeks to make the Agricultural Wages Board conform with the wages councils; but there is a significant difference. It is that the rate paid in agriculture is directly related—I repeat, directly related—to the minimum rate prescribed by the Agricultural Wages Board. Those rates are the key figure for all rates paid in agriculture. This is very often not so with wage councils in industry where free collective bargaining can often fix rates far higher than those rates agreed by the wages councils. Some noble Lords, and certainly my noble friend Lady Vickers, may feel that there is not much difference between the Agricultural Wages Board and the wages councils. I would refer her to the Donovan Report—the Royal Commission on Trade Unions and Employers'Associations—where it is stated quite clearly that the Agricultural Wages Board is totally different from the wages councils.

My Lords, I would therefore say to my noble friend that, while I understand and appreciate the reasons which prompted her to put down this Amendment, I believe that if it were to be accepted not only would it be highly inflationary but it would place an arbitrary figure on the discussions between employees and employers on the Agricultural Wages Board which has nothing to do with the conditions of the industry and which would be binding and unsatisfactory. I hope therefore that my noble friend will not feel minded to press this Amendment.

Lord JACQUES

My Lords, a good deal of the case of the noble Earl, Lord Ferrers, against this Amendment was based upon the effect of Amendment No. 89. I think I can throw some light on that: that Amendment was discussed yesterday and I made it clear that that Amendment was not acceptable to the Government. I do not think we need fear the effect of Amendment No. 89 when considering Amendment No. 80. So far as Amendment No. 80 is concerned, it is completely acceptable to the Government. We have the same strong feelings as the noble Baroness, and if the House accepts this Amendment and establishes the principle, the Government will see to it that the necessary additional Amendments which are needed for the principle expressed will be prepared and submitted in due course.

Baroness VICKERS

My Lords, I am grateful to the noble Lord for his answer, and I beg leave to divide the House on this Amendment.

3.31 p.m.

On Question, Whether the said Amendment (No. 80) shall be agreed to?

Their Lordships divided: Contents, 77; Not-Contents, 135.

CONTENTS
	Greenway, L.	Popplewell, L.
Airedale, L.	Hale, L.	Pritchard, L.
Amherst, E.	Hankey, L.	Raglan, L.
Amulree, L.	Hoy, L.	Rhodes, L.
Bacon, B.	Hylton-Foster, B.	Robson of Kiddington, B.
Beswick, L.	Jacques, L.	Rusholme, L.
Birk, B.	Kinloss, Ly.	St. Davids, V.
Blyton, L.	Kirkhill, L.	Seear, B.
Briginshaw, L.	Leatherland, L.	Shepherd, L. (L. Privy Sea1.)
Brockway, L.	Lee of Newton, L.	Shinwell, L.
Buckinghamshire, E.	Llewelyn-Davies of Hastoe, B.	Simon, V.
Burntwood, L.	Lloyd of Kilgerran, L.	Slater, L.
Burton of Coventry, B.	Loudoun, C.	Snow, L.
Byers, L.	Lovell-Davis, L.	Stamp, L.
Champion, L.	Lyons of Brighton, L.	Stedman, B.
Chorley, L.	Lytton, E.	Stewart of Alvechurch, B.
Cooper of Stockton Heath, L.	McLeavy, L.	Strabolgi, L.
Crook, L	MacLeod of Fuinary, L.	Summerskill, B.
Crowther-Hunt, L.	Maelor, L.	Swaythling, L.
Darwe[...], L.	Mais, L.	Taylor of Mansfield, L.
Douglas of Barloch, L.	Melchett, L.	Vickers, B. [Teller.]
Douglass of Cleveland, L.	Milford, L.	Wade, L.
Elwyn-Jones, L. (L Chancellor.)	Ogmore, L.	Wells-Pestell, L.
Gaitskell, B.	Paget of Northampton, L.	Wigg, L.
Geddes of Epsom, L.	Pannell, L.	Wigoder, L. [Teller.]
Goronwy-Roberts, L.	Platt, L.	Winterbottom, L.
NOT-CONTENTS
	Drumalbyn, L.	Kindersley, L.
Aberdare, L.	Dundee, E.	Kintore, E.
Alexander of Tunis, E.	Effingham, E.	Lauderdale, E.
Alport, L.	Elles, B.	Lindsey and Abingdon, E.
Amherst of Hackney, L.	Elliot of Harwood, B.	Long, V.
Amory, V.	Elton, L.	Lothian, M.
Armstrong, L.	Essex, E.	Luke, L.
Ashdown, L.	Exeter, M.	Lyell, L.
Auckland, L.	Falkland, V.	Malmesbury, E.
Baldwin of Bewdley, E.	Ferrers, E.	Mansfield, E.
Balerno, L.	Ferrier, L.	Massereene and Ferrard, V.
Balniel, L.	Forbes, L.	Merrivale, L.
Barnby, L.	Fortescue, E.	Mersey, V.
Belstead, L.	Fraser of Kilmorack, L.	Middleton, L.
Birdwood, L.	Gage, V.	Monck, V.
Boothby, L.	Gisborough, L.	Mottistone, L.
Bridgeman, V.	Glasgow, E.	Mountgarret, V.
Brooke of Ystradfellte, B.	Glenkinglas, L.	Mowbray and Stourton, L. [Teller.]
Burnham, L.	Goschen, V.
Caccia, L.	Grenfell, L.	Netherthorpe, L.
Cairns, E.	Gridley, L.	Newall, L.
Camoys, L.	Grimston of Westbury, L.	Nugent of Guildford, L.
Campbell of Croy, L.	Hailsham of Saint Marylebone, L.	Onslow, E.
Carrington, L.		Orr-Ewing, L.
Cathcart, E.	Harcourt, V.	Porritt, L.
Clifford of Chudleigh, L.	Harmar-Nicholls, L.	Rankeillour, L.
Clitheroe, L.	Hawke, L.	Redesdale, L.
Cobham, V.	Headfort, M.	Reigate, L.
Colville of Culross, V.	Hereford, V.	Roberthall, L.
Cornwallis, L.	Hertford, M.	Rockley, L.
Cottesloe, L.	Hives, L.	Runciman of Doxford, V.
Cowley, E.	Hornsby-Smith, B.	Ruthven of Freeland, Ly.
Crawshaw, L.	Hunt of Fawley, L.	Sackville, L.
Croft, L.	Iddesleigh, E.	St. Aldwyn, E.
Daventry, V.	Inglewood, L.	St. Helens, L.
de Clifford, L.	Ironside, L.	Sandford, L.
de Freyne, L.	Kemsley, V.	Sandys, L.
De La Warr, E.	Killearn, L.	Selkirk, E.
Denham, L. [Teller.]	Kilmany, L.	Sempill, Ly.
Sharples, B.	Suffield, L.	Tranmire, L.
Sinclair of Cleeve, L.	Swansea, L.	Vernon, L.
Strathclyde, L.	Swinton, E.	Vivian, L.
Strathcona and Mount Royal, L.	Tenby, V.	Wakefield of Kendal, L.
	Terrington, L.	Ward of North Tyneside, B.
Strathmore and Kinghorne, E.	Thomas, L.	Willingdon, M.
Strathspey, L.	Thorneycroft, L.	Young, B.
Stuart of Findhorn, V.

On Question, Amendment agreed to.

3.43 p.m.

Lord JACQUES

My Lords, with the leave of the House, I should like not to move Amendment No. 81 and to substitute a manuscript Amendment. The Amendment is entirely drafting. The manuscript Amendment would agree with the Amendment which was before the House, except that the three words "expressions used in" would be omitted. I beg leave to move the manuscript Amendment.

Amendment moved— Page 100, line 25, leave out from first ("in") to end of line 27 and insert ("the provisions of this Act relating to unfair dismissal and in provisions of the 1974 Act relating to unfair dismissal have the same meaning in this Act as in that Act.")—(Lord Jacques.)

The LORD CHANCELLOR

My Lords, the noble Lord seeks leave not to move Amendment No. 81 and to substitute the manuscript Amendment. I take it there is no objection being raised in the House to this procedure? The Amendment proposed is: Clause 115, page 100, in line 25, leave out from first ("in") to end of line 27 and insert ("the provisions of this Act relating to unfair dismissal and in provisions of the 1974 Act relating to unfair dismissal have the same meaning in this Act as in that Act.").

Lord PLATT moved Amendment No. 82: Page 100, line 32, after ("any") insert ("relevant").

The noble Lord said: My Lords, with the permission of the House, I must deal with Amendments Nos. 82 and 83 at the same time. They are in fact the same Amendment and I was surprised when I found them put down in two parts on the Marshalled List. I should apologise for not having brought the Amendments—or rather this subsection of Clause 115—to the notice of your Lordships at an earlier stage. It was, however, brought to my notice only comparatively recently, and your Lordships will no doubt realise that a Bill of this kind, which is almost entirely concerned with industry, is difficult for a professional man like myself—who may wish to go through it clause by clause—to understand what it is all about: in fact, the task is almost impossible.

Clause 115 deals with interpretation and I am concerned with subsection (3), relating to union membership agreements. In the case of those agreements, this subsection says that, … employees are to be treated … as belonging to the same class if they have been identified as such by the parties to the agreement"— which I take to be the employer and the trade union— … and employees may be so identified by reference to any characteristics or circumstances whatsoever. I submit to your Lordships that this is such a wide-ranging subsection that it is almost meaningless. If they are to be considered of the same class through any characteristics whatever, one could make a perfectly stupid suggestion such as saying that they might be selected by the colour of their eyes.

Of course, one could make the more relevant suggestion that they might be people all working in the same place. If so, does this not lead to what I consider to be the danger that professional people may very easily find themselves put into a trade union which really does not represent their interests at all, and whose Code of Practice may be quite different from that of professional bodies in general? Though, naturally, as a doctor, I speak from the point of view of the medical profession, I think this has to be looked at carefully as it concerns all professional people. I shall be very surprised if the Government's reply does not go at least as far as saying that they will alter this wording. My Lords, I beg to move.

Lord HAWKE

My Lords, before the noble Lord replies, may I ask him, when he does so, to explain the meaning of the last phrase of the subsection. It is very difficult to understand what exactly is meant there.

Lord JACQUES

My Lords, I will proceed with the reply to the debate and hope that by the time I have finished a note will have reached me, so that I can give an answer without the need to look up that point. May I first assure the noble Lord, Lord Platt, that the Bill as it stands, and in particular this subsection, will not have any effect whatever as regards forcing professional classes to belong to any union, or not to belong.

The wording used here is that which was used in the Trade Union and Labour Relations (Amendment) Bill earlier in the year. There was some doubt as to whether the characteristics which had to be enjoyed by a class excluded from a closed shop agreement had to be relevant to their employment. In order to meet Opposition criticism, the Government put forward an Amendment containing wording which made the whole matter flexible, and put it beyond all doubt that the characteristics need not have relevance to the employee's employment.

The Government's attitude was welcomed by all sides of the House and by all sides of the other place. The position is this. Here we are not concerned with who should be included in a closed shop agreement; we are concerned with whom the parties may exclude from such an agreement. It is the wish of the Government that, without invalidating an agreement, either the employer or both parties shall agree that any class whatsoever shall be exempt from the closed shop agreement; not that they shall or shall not join any union, but that they shall be exempt from the closed shop agreement. As the wording stands now, exemptions should be granted on age—all over 65, if you like; exemptions could be granted on existing union membership—to exempt from the closed shop agreement, for example, all those who are in a professional union; there could be exemption of those who have some conscientious conviction. We believe that there should be absolute flexibility in excluding people from union membership agreements, and that is why the Bill is worded in this way. We believe that in its present form it would facilitate industrial relations.

The Amendment is wholly unacceptable to the Government for two reasons. First, it would make it more difficult to exclude people whom the parties wish to exclude from closed shop agreements. Secondly, it would mean that this clause would be quite different from Clause 30 of the Trade Union and Labour Relations (Amendment) Bill. We take the view that a declaratory clause dealing with the same subject should be identical. Therefore, we would think that this was an inconsistency which should be avoided. I hope that with those explanations the noble Lord will feel that he can withdraw the Amendment. Before sitting down, may I say that my message is that we are not sure about the point raised by the noble Lord, Lord Hawke, and if he does not mind we will write to him on it.

Lord HAWKE

My Lords, it is the noble Lord's Bill. Could he not explain what the clause means? The explanation I have listened to does not appear to me to have any relevance to the words in the Bill; but of course I may be entirely wrong.

Lord PLATT

My Lords, I must thank the noble Lord, Lord Jacques, very much for his lucid explanation of his interpretation of the Bill. I very much agree with the noble Lord, Lord Hawke, in that I could not have read that into this subsection at all. But I understand from the noble Lord who replied that it is not this subsection that matters, and that other parts of the Bill make this point clear. I still think that this is an undesirable way of going about it. Nevertheless, I am extremely glad that I raised the matter because the assurances which the noble Lord has given to professional people like myself are important and valuable, and I therefore beg leave to withdraw the Amendment.

Lord JACQUES

My Lords, before this Amendment is withdrawn, with the leave of the House I should like to thresh out this point with the noble Lord, Lord Hawke. As I understand it, he is dealing with subsection (3) on page 100.

Lord HAWKE

Yes, my Lords.

Lord JACQUES

The query concerns the meaning of the last two lines.

Lord HAWKE

My Lords, the noble Lord was talking a great deal about exemptions while, so far as one can read it, the subsection appears to be concerned with inclusion.

Lord JACQUES

My Lords, I can find nothing here which would enable the noble Lord to come to that conclusion. I can assure the noble Lord that this provision is concerned with exemption; that is to say, those who can be excluded from a closed shop agreement.

Baroness ELLIOT of HARWOOD

My Lords, I support the noble Lords, Lord Hawke and Lord Platt. I have listened with great interest to every word said and have read this clause carefully. There is not one word here about exemption, not a syllable. It says: belonging to the same class as if they had been identified as such by the parties to the agreement, and employees may be so identified by reference to any characteristics or circumstances whatsoever". This wording made me think that everybody was going to be included in an all-purpose, umbrella clause. It is quite understandable to the initiated, and I may be very stupid, but I am glad to have both Lord Platt and Lord Hawke ask about it in the same way. This provision is extremely badly drafted if it is supposed to mean what the noble Lord, Lord Jacques, has so ably said to us. But that is not what it says.

Baroness SEEAR

My Lords, is not this a good argument for doing something about this clause? One assumes that your Lordships' House is at least of average intelligence and this Bill is meant to be understood by people some of whom may be of below average intelligence. If we cannot understand it, is it not likely that they cannot understand it? Is not this a good argument for ensuring that the subsection is clear?

Lord LEATHERLAND

My Lords, it is often said that people with a less intelligent attitude than Members of your Lordships' House might have to deal with this matter. If the noble Baroness is referring to trade union officials, I would say that their standard of intelligence may in many cases be somewhat higher than that of Members of your Lordships' House, especially in matters of this kind.

Baroness SEEAR

My Lords, I hope that this legislation will not be wholly handled by officials but will be intelligible also to the rank and file.

Lord LEATHERLAND

My Lords, to return to the question which seems to be mystifying us, is it not more simple than some noble Lords have tried to make out? This clause deals with union membership agreements. Is it not a fact that a union membership agreement can say, on the one hand, there is to be a closed shop with so-and-so in it and, on the other hand, there is to be a closed shop with so-and-so not in it? Surely that is what we are discussing, and with that flexibility the clause seems to me to make perfect sense and to be capable of a quite sensible interpretation.

Baroness WARD of NORTH TYNESIDE

My Lords, I find this subsection a little difficult to understand, too. May I ask the noble Lord what difference will be made to the whole Bill if this clause is just taken out? May I also ask, as a matter of interest, whether the position of the nursing profession—I happen to be a vice-president of the Royal College of Nursing—will be as free as it is at the present time? I do not want to get any profession with which I am connected involved in any way, without knowing what I am getting them involved in. So perhaps the noble Lord could explain what difference it would make if the clause was just taken out of the Bill.

Lord JACQUES

My Lords, if, with the leave of the House, I may speak again, I would remind noble Lords that here we have a Part of the Bill which is headed "Interpretation". The normal identifiable class is all employees. The Bill enables the parties to a union membership agreement to indicate that that agreement shall comprise all employees except—and the exception can be any class with any characteristics in common. It gives the maximum freedom in excluding people from the union membership agreement and is quite clear when it is read in the context of that part of the Bill, particularly that part of the Trade Union and Labour Relations (Amendment) Bill.

Lord HANKEY

My Lords, it seems to me that there is something in what the Government say—that this gives great freedom to exclude anybody. However, it seems to me to give even greater freedom to include people without even consulting them. May I suggest to the Government that this clause is not very comprehensible? As a diplomat for many years, I found that clauses which were obscure usually led to trouble and that it very seldom paid not to clarify them if it was possible to do so. In view of the very good assurances that the Government have given, may I ask them to have another look at this clause to see whether or not, in the light of the criticisms which have been made in your Lordships' House they could improve the drafting? Perhaps we could then amend it at Third Reading.

Lord SHEPHERD

My Lords, may I remind the noble Lord that we are on Report stage? We are not discussing the clause as a clause. That opportunity was open to us at the Committee stage. To the best of my knowledge, the problems which have now arisen did not arise in Committee. If there is a wish that the Government should look at this clause to see whether it can be drafted in a clearer fashion, certainly I will undertake to do that. But I cannot give any undertaking that we shall be able to improve it, because Parliamentary draftsmen have a particular art of their own and are very difficult to shift. However, I will see whether any improvement can be made. We are discussing the Amendment of the noble Lord, Lord Platt. I wonder whether the noble Lord would either withdraw his Amendment or press it.

Lord PLATT

My Lords, I have already asked leave to withdraw the Amendment.

Lord SHEPHERD

Then, my Lords, perhaps the noble Lord would do so rather more audibly.

Amendment, by leave, withdrawn.

Clause 117 [Northern Ireland]:

Lord JACQUES

My Lords, Amendment No. 86 is a drafting Amendment. I beg to move.

Amendment moved— Page 103, line 40, leave out ("Ireland") and insert ("Irish").—(Lord Jacques.)

Schedule 1 [Advisory, Conciliation and Arbitration Service etc.]:

Lord SHEPHERD

My Lords, the purpose of Amendment No. 88 is to correct a serious omission. In Clause 7(4) the appointment of assistant certification officers is made possible, but no power has been granted for the payment of their remuneration or allowances. The purpose of this Amendment is to provide for that. My Lords, I beg to move.

Amendment moved— Page 110, line 20, at end insert ("and any assistant certification officer").—(Lord Shepherd.)

Schedule 13 [Amendments of Employment Agencies Act 1973]:

Lord JACQUES

My Lords, Amendment No. 92 is a drafting Amendment. I beg to move.

Amendment moved— Page 151, line 22, leave out ("substitute") and insert ("insert")—(Lord Jacques.)

Schedule 14 [Amendments of Employment and Training Act 1973]:

Lord JACQUES

My Lords, I beg to move Amendments Nos. 93 to 98 inclusive. I spoke to all of these Amendments when I moved Amendment No. 71.

Amendments moved—

Page 153, line 30, leave out ("and")

Page 153, line 33, at end insert— ("and (c) obtaining employment for any description of persons in Great Britain who in his opinion would, because of their special circumstances and a high or increasing level of unemployment in Great Britain, otherwise have or be likely to have difficulty in obtaining employment;")

Page 153, line 38, leave out ("Paragraph (b)"and insert ("Paragraph (b) and (c)")

Page 153, line 43, after ("(b)") insert ("or the said paragraph (c) or both paragraphs")

Page 154, line 2, leave out ("that paragraph is") and insert ("either or both of those paragraphs is or are")

Page 153, line 5, after ("(b)") insert ("or (c)")—(Lord Jacques.)

Schedule 16 [Minor and consequential amendments]:

Lord JACQUES

My Lords, Amendment No. 99 is a consequential Amendment. I beg to move.

Amendment moved—

Page 163, line 10, at end insert— ("12A. In section 31(4) (repayment from Redundancy Fund in certain cases) for the words "the appropriate allocation to the Redundancy Fund" substitute the words "the amount paid into the Redundancy Fund from the appropriate employment protection allocation".")—(Lord Jacques.)

Lord JACQUES

My Lords, the purpose of Amendment No. 100 is to tidy up the definition of "insolvency" in Section 32 of the Redundancy Payments Act 1965, and to bring it into line with that used in Clause 60 of this Bill. I beg to move.

Amendment moved—

Page 163, line 10, at end insert— ("12A. In section 32(5) (definition of insolvency), at the end of paragraph (a) insert the words "or a receiving order is made against him.

12B. In section 32(6) (definition of insolvency in Scotland) —

1. (a) for the words "paragraph (a) and (b)"substitute the words "paragraphs (a), (b) and (c)";
2. (b) in paragraph (a) as substituted omit the word "or" in the third place where it occurs; and
3. (c) after paragraph (b) as substituted insert the following paragraph—

": or (c) where the employer is a company, a winding up order has been made or a resolution for voluntary winding up is passed with respect to it or a receiver of its undertaking is duly appointed".")—(Lord Jacques.)

4.7 p.m.

The Earl of MANSFIELD moved Amendment No. 101: Page 167, line 39, leave out ("twelve") and insert ("eight").

The noble Earl said: My Lords, your Lordships will notice that in Part II of what is now Schedule 16, which deals with amendments to the Contracts of Employment Act 1972, among other things certain minimum periods by way of notice of termination of contract are laid down. It is interesting to note that when the Act was originally passed in 1963 the minimum periods of notice to be given by an employer to an employee were one week's notice after six months' service but less than two years, two weeks' notice after two years but less than five years and four weeks' notice after five or more years of service. In 1972, under the Industrial Relations Act 1971, those periods were increased to one week's notice after 13 weeks' service but less than two years, two weeks' notice after two years but less than five years and four weeks' notice after five years but less than 10 years, six weeks' notice after 10 years but less than 15 years and eight weeks' notice after 15 or more years of service.

The effect of paragraphs 1 and 2 in Part II of Schedule 16 to this Bill is that employees are entitled to one week's notice after four weeks' service only, and an additional week's notice for every year of service from two years up to 12 years. By way of illustration, one may say that a man with two years' service will get a minimum of two weeks' notice, that a man with seven weeks' service will get a minimum of seven weeks' notice and that a man with 12 or more years of service will get a maximum of three months' notice. Throughout all this legislation, ever since the original Act of 1963, the notice demanded from an employee has remained a period of one week. So far as notice to an employee is concerned, the notice requirement has been dropped from 26 weeks in 1963 to 13 weeks in 1972 and only four weeks in 1975. Equally, the minimum notice will have gone up from four weeks in 1963 to eight weeks in 1972 and 15 weeks in 1975, three years later. From the employee's point of view these are very considerable improvements. So far as the present proposals are concerned, I submit to the House that the new provisions go too far down the road so that what has perhaps previously been an imbalance one way has without doubt now tipped the other way.

I appreciate that to an extent the Government have had to "pay"—if that is the right word—the TUC in relation to their commitment to the Social Contract. But, as I shall illustrate, the "payment", if it can be called such, will have wide-ranging and possibly deleterious effects on industry. In our view a minimum of three months' notice is too long, whatever the employee's service may be, and this is particularly so at the present time of recession. Many companies, large and small, are experiencing grave cash-flow problems. Naturally they want to keep their workforce together as long as they can, but sometimes they find themselves in extreme difficulties when it comes to redundancies, particularly where long-service employees are concerned. Some just do not have the cash available to pay the redundancy payments, and for long periods of notice as well, and the provisions in this part of the Bill will exacerbate the situation still further.

So, while being in sympathy with the principle behind the legislation—and I wish to emphasise that—noble Lords on this side of the House propose that the maximum amount of notice should, as it were, reach a compromise under the Bill at eight weeks, so that in effect we accept the basis of one week per year up to that amount. Indeed, we are even prepared to accept one week's notice after only four weeks' service, although I daresay some would consider that as being overgenerous. My Lords, we consider this to be a reasonable compromise. I beg to move.

Lord JACQUES

My Lords, the Bill as drafted provides for 12 weeks' notice as a maximum and only after 12 years' service. The Amendment would seek to limit the employee's maximum length of notice to 8 weeks after 8 years' service. The provision in the Bill is quite obviously made to protect people with long service. These are often the older people in employment, people who find it extremely difficult to get another job, and certainly people who find it even more difficult to get a job which is commensurate with their experience, their status and the salary which they have enjoyed.

We feel it is right that the employer and society in general should show generosity to people who have given this kind of long service and who find themselves redundant at a later stage of their lives. The idea for the improvement does not arise out of any Social Contract. It is an attempt by the Government to bring us more into line with the EEC, although we shall still be behind some of the EEC countries if this Bill is accepted. At present in Germany the maximum is 13 weeks for manual workers, but it is 26 weeks for clerical workers. All we are suggesting is 12 weeks for all workers which would make us comparable with, say, the Netherlands, where it is 13 weeks for all workers. If we are going to be brought into line with the other EEC countries, the workers are part of this country and they have a right to be brought into line, to their advantage.

The Earl of MANSFIELD

My Lords, the noble Lord's heart is large and generous, but it is easy to be so when it is with other people's money. I fully appreciate what he has said about the European Economic Community, but unfortunately we do not have the standard of living that they have in Western Germany—through their own efforts—and we do not have a "cake" which we can slice as generously as we should all like. In these Amendments we have tried to strike what we consider to be a fairer balance as between the employee and the employer than the Government have done. Nevertheless, I see, and I am sure all noble Lords will appreciate, the difficulties of those who find that they are redundant after many years' service with one employer. These Amendments were tabled and certainly have been debated to emphasise, perhaps fairly starkly, where the imbalance between employers and employees lies in this Bill. I believe I have made the point, and in those circumstances I beg leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

4.15 p.m.

Lord JACQUES

My Lords, Amendment No. 104 is a drafting Amendment. I beg to move.

Amendment moved— Page 168, line 12, leave out ("there shall be substituted") and insert ("substitute").—(Lord Jacques.)

Baroness VICKERS moved Amendment No. 105:

Page 170, line 32, at end insert— . After paragraph 4 of Schedule 1 insert the following paragraph— 4AA. Any week of employment with a previous employer which by virtue of a provision in a written statement of terms of employment issued by an employer to an employee in accordance with section 4 of this Act counts as continuous employment with the employer, shall count in computing a period of employment.".

The noble Baroness said: My Lords, I hope I shall have greater success with this Amendment than with my previous one. Paragraph 4 of Part II of the Schedule amends the Contract of Employment Act 1972 by requiring employers to state whether any employment with a previous employer counts as part of the employee's continuous period of service with him, and if so, to specify the date on which the continuous period of employment began. Despite this, it is understood that there will be no automatic entitlement to rebate as a consequence of Amendments under the 1972 Act, as proposed in the present Bill. The local government authorities are in a special position in regard to this, because although an employee may move from one authority to another technically he has a new employer and the service with the previous employer counts as continuous service: for example, for his pension and also for redundancy payment. This Amendment, if accepted, will enable local authorities to claim rebate in respect of a period of continuous employment, whether it is in the employee's present or previous authority. I beg to move.

Lord JACQUES

My Lords, speaking personally I have a good deal of sympathy with this Amendment. I have spent a lifetime in the Co-operative Movement, where my friends move from one society to another in much the same way as people move from one local authority to another. On one occasion I lost my pension rights as a result of such a move. But the problem, as we see it, arises largely when there is a takeover; that is, when one employer takes over the business of another employer. That is the problem that we saw when we were drafting this part of the Bill. In those circumstances, after the takeover an employee can often find that while he thought the new employer was recognising his past services, in fact he was not doing so. Consequently, the employee can find that he has lost the benefits of that past service if the employer says, "I am not recognising your past service".

We have tried to remedy this in an Amendment which is embodied in Schedule 16 to the Bill. We are laying it down there that, when there is a takeover, the new employer must specify in writing whether he is recognising any past service by the employee to a previous employer, and if so, to what extent; that is, he has to indicate the date back to which he is recognising service. We feel it is absolutely necessary to make it firm so that the employee really knows how far his past service is being recognised when he is being taken over by a new employer.

However, we cannot go as far as the noble Baroness, Lady Vickers, wants us to go, because there are great dangers. For example, if this Amendment were embodied in the Bill, it would facilitate the "poaching" of employees. An employer who wanted an employee from another firm could say, "In addition to the increased salary, I will recognise your service with your present employer". That would encourage "poaching". But, equally important from our point of view, it would mean that payments out of the Redundancy Fund would not be related to the facts, but would be related to whatever an employer wanted to do. So far as we are concerned, that is untenable; consequently, we feel we cannot accept this Amendment.

Baroness VICKERS

My Lords, I am disappointed with that reply. I should like to take it up again with the county councils, because they are the people worried about this. Perhaps I can discuss this again later. Meanwhile, I withdraw the Amendment.

Amendment, by leave, withdrawn.

4.22 p.m.

Lord JACQUES

My Lords, this is purely a drafting Amendment. I beg to move.

Amendment moved— Page 174, line 32, after ("specified") insert ("for the purposes of or in relation to a union membership agreement").—(Lord Jacques.)

Lord JACQUES

My Lords, Amendment No. 107 does not materially alter the sense of the relevant paragraph, but it does achieve consistency. I beg to move.

Amendment moved— Page 177, line 26, leave out ("serious") and insert ("substantial").—(Lord Jacques.)

The Earl of MANSFIELD

My Lords, I do not in any way want the noble Lord, Lord Jacques, to think that in what I am going to say I am twitting him, but it remains a fact that during Committee stage my noble friend Lord Gowrie moved an Amendment to what was then Schedule 11, seeking to insert the word "substantially" not "substantial". The noble Lord the Leader of the House when replying in the debate, at column 529 said: But I have to tell him, of course, as other Ministers of different political complexions have done in the past, that the word 'substantial' always raises very considerable difficulties in legislation when it comes to interpretation by the courts. Therefore I would not advise the Committee to believe that this Amendment would in any way help to meet the case that the noble Earl has himself put forward."—[Official Report; 25/9/75; col. 529.] This particular part of the Bill deals shortly if I may so put it, with the regulations governing the industrial tribunals, and in effect it may provide for tribunals to sit in private where evidence has to be given about certain information, the disclosure of which would cause "substantial", as it is now, but previously "serious", injury. This is not a semantic argument on the play of words. We do it for this reason, and this reason alone: that the Amendment of my noble friend Lord Gowrie, carried on a Division, will no doubt eventually come to be considered by the Government, and possibly with recommendations—or the lack of them—in another place. Therefore, I ask the Government to be consistent in this matter. The circumstances of that Amendment and this are not precisely parallel or the same, but the principles are the same. If "substantial" is good enough for this Amendment to do with tribunals, I suggest it is also good enough for my noble friend.

Lord JACQUES

My Lords, we are trying to be consistent, and the noble Earl, Lord Mansfield, will not let us be so. The facts are that Clause 18(1)(e), which we discussed yesterday, enables an employer to decline to give information to a trade union because it would do substantial injury to the undertaking. In the clause we are now considering we are dealing with the appeal that might be made, that the employer has refused to give the information and inadvertently caused, it says "serious" injury. We are now suggesting that that should be "substantial" injury, so that this is in line with the substantive Clause 18(1)(e).

Lord JACQUES

My Lords, this is a drafting Amendment. I beg to move.

Amendment moved— Page 178, line 2, after ("42") insert ("and"). —(Lord Jacques.)

4.26 p.m.

Lord JACQUES

My Lords, my note says, "This is a minor drafting Amendment". I beg to move.

Amendment moved—

Page 178, line 13, at end insert— ("26A. In paragraph 28(2) of Schedule 1 for the word "claimant" substitute the word "complainant".")—(Lord Jacques.)

Lord JACQUES

My Lords, this is a technical Amendment to take account of change of name. I beg to move.

Amendment moved—

Page 179, line 13, at end insert: 33.—(1) For the avoidance of doubt it is hereby declared that the change of name of the Industrial Court to the Industrial Arbitration Board originally effected by section 124(2) of the Industrial Relations Act 1971 and continued in force, so far as the Industrial Courts Act 1919 is concerned, by paragraph 3 of Schedule 3 to the 1974 Act, shall, as respects the relevant period be taken not to have divested that body of any functions under any other enactment or any instrument notwithstanding that after the repeal by the 1974 Act of the said section 124(2) references in any such other enactment or any such instrument to the Industrial Court were no longer expressly directed to be construed as references to the Industrial Arbitration Board. (2) In this paragraph "the relevant period" means the period beginning with 16th September 1974 (the day appointed for the coming into operation of the said Schedule 3, and ending with the repeal by this Act of Part I of the Industrial Courts Act 1919."—(Lord Jacques.)

Lord JACQUES

My Lords, This is a drafting Amendment. I beg to move.

Amendment moved—

Page 179, line 35, at end insert— (1A) The following provisions and passages are hereby repealed: Sections 1, 2 and 3. In section 4(1), the words "whether or not the dispute is reported to him under Part I of this Act". In section 7, the words "of the Industrial Arbitration Board and". In section 9, the words "before the Industrial Arbitration Board, before an arbitrator or". Sections 11 and 12."—(Lord Jacques.)

Lord JACQUES

My Lords, this is also a drafting Amendment. I beg to move.

Amendment moved— Page 184, line 21, leave out ("there shall be inserted") and insert ("insert").—(Lord Jacques.)

Lord JACQUES moved Amendment No. 113: Page 184, line 29, leave out from (""offices"") to end of line 31 and insert ("insert the following entry at the appropriate place in alphabetical order:—").

The noble Lord said: My Lords, with the leave of the House, I shall speak to Amendments Nos. 113 and 114. Amendment No. 114 is a substantive Amendment, and Amendment No. 113 is consequential. Amendment No. 114 will permit members of a statutory joint industrial council constituted under Schedule 8 to be Members of the House of Commons. The Bill as drafted would disqualify them from membership of the House of Commons under the House of Commons Disqualification Act 1975. Disqualification of members of statutory joint industrial councils from being Members of Parliament is not appropriate, because they will not be appointed by the Secretary of State, and payment will be confined to expenses and allowances for loss of earnings; thus, the element of ministerial patronage—the main criterion for statutory disqualification—will be removed.

As a consequence of Amendment 114, sub-paragraph (3) provides for only one entry to be inserted in Part III of Schedule 1 of the House of Commons Disqualification Act 1975. Amendment No. 113 redrafts sub-paragraph (3) to take account of this. I beg to move.

Lord JACQUES

My Lords, I beg to move Amendment No. 114.

Amendment moved— Page 184, leave out lines 34 to 36.—(Lord Jacques.)

Schedule 17 [Transitional Provisions]:

4.30 p.m.

Lord MELCHETT moved Amendment No. 115: Page 186, line 22, after ("Board") insert ("(whether by that or any other name)").

The noble Lord said: My Lords, this Amendment follows Amendment No. 3 made to Clause 10, and reflects the fact that the name of the industrial court established under the Industrial Courts Act 1919 was changed to Industrial Arbitration Board by the 1971 Act, but its constitution was not altered. I beg to move.

Lord MELCHETT

My Lords, if I may, I will take Amendments Nos. 116 and 117 together. These Amendments seek to extend paragraph 7 of Schedule 17, which makes transitional provisions in respect of the Bill's provisions relating to unfair dismissal to apply also to Clauses 69 to 71. I beg to move.

Amendments moved— Page 186, line 26, leave out ("67") and insert ("71"). Page 186, line 47, leave out ("67") and insert ("71").—(Lord Melchett.)

Schedule 18 [Enactments repealed]:

Lord MELCHETT

My Lords, as a result of the repeal provisions in Schedule 18 to the Bill relating to the Industrial Courts Act 1919, no reference to the Industrial Court or Industrial Arbitration Board will be left in the Trades Union and Labour Relations Act. Paragraph 3 of Schedule 3 to the Trades Union and Labour Relations Act will therefore no longer be necessary, and it is removed by this Amendment. I beg to move.

Amendment moved— Page 192, line 58, at end insert ("3,").—(Lord Melchett.)

Lord MELCHETT

My Lords, this Amendment follows from the repeal of the 1959 Act earlier in the Schedule. I beg to move.

Amendment moved— Page 192, line 58, at end insert ("8,").—(Lord Melchett.)

Lord MELCHETT

My Lords, this Amendment is purely drafting. I beg to move.

Amendment moved— Page 193, line 1, after ("10(4)") insert ("and").—(Lord Melchett.)

Lord MELCHETT

My Lords, this Amendment is consequential on Amendment No. 1. I beg to move.

Amendment moved—

Page 193, line 37, at end add—

"1975 c.	The Sex Discrimination Act 1975.	In section 82(1), the definition of conciliation officer.
		In Schedule 5, paragraph 4.")—(Lord Melchett.)

In the Title:

Lord MELCHETT

My Lords, if I may, I will take Amendments Nos. 123 and 124 together. These Amendments to the Title are required consequent upon the introduction of Clause 103. I beg to move.

Amendments moved— Line 7, after ("to") insert ("entitlement to and recoupment of"). Line 8, leave out from ("benefit") to ("to") in line 9.—(Lord Melchett.)

Then, Standing Order No. 44 having been dispensed with, pursuant to Resolution:

4.33 p.m.

Lord JACQUES

My Lords, I beg to move that the House do now resolve itself into a Committee on Recommitment on the Bill in respect of Clauses 34 to 43, 54, 55, 111, 113 and 117.

Moved, That the House do now resolve itself into Committee on Recommitment.—(Lord Jacques.)

House in Committee accordingly.

[The Viscount GOSCHEN in the Chair.]

Clause 34 agreed to.

Clause 35 [Rights of employee in connection with pregnancy and confinement].

Lord JACQUES moved Amendment No. 14: Page 29, line 1, leave out ("both").

The noble Lord said: Perhaps at this stage I should explain that we do not come to the clauses dealing with the funding of the maternity scheme until we get to Amendment No. 20. Amendments Nos. 20 to 28 inclusive are the substantive Amendments. At the moment I am concerned with Amendment No. 14, and I should like to speak to Amendments Nos. 14 to 16 inclusive, Nos. 18, 29 to 30 inclusive, and Nos. 32 to 38 inclusive. All of these are drafting Amendments making corrections to incorrect references. I beg to move Amendment No. 14, and I will move the others formally at the appropriate time. I beg to move.

Lord JACQUES

I beg to move Amendment No. 15.

Amendment moved— Page 29, line 4, leave out ("entitled to either right") and insert ("so entitled").—(Lord Jacques.)

Lord JACQUES

I beg to move Amendment No. 16.

Amendment moved— Page 29, line 9, leave out ("and").—(Lord Jacques.)

The Earl of MANSFIELD moved Amendment No. 17: Page 29, line 13, leave out ("if he so requests").

The noble Earl said: This Amendment, as the noble Lord, Lord Jacques, has said, has nothing to do with the funding of these provisions. It is simple, but it is nevertheless important. Your Lordships will see set out in what is now Clause 35 of the Bill the rights of the employee in connection with pregnancy and confinement. Clause 35(2) sets out the way in which an employee is entitled to the rights set out in subsection (1), whether or not a contract of employment subsists. More especially, subsection (2)(c) says she shall not be entitled to those rights unless, in effect, she informs her employer (in writing if he so requests) at least three weeks before her absence begins or, if that is not reasonably practicable, as soon as reasonably practicable. The words complained of—if that is the right phrase—are "if he so requests", and this Amendment seeks to exclude them from the subsection.

The history of the matter is this: in another place the clauses dealing with maternity questions, and in particular maternity leave, were substantially redrafted at Committee stage, and as a result of representations the Government added the requirement that the woman should put her notice of intention to return in writing if the employer so requests. Unfortunately, the Amendment as it is at the moment in the Bill does not cure the mischief. I say that because if one considers it for a moment the reason for asking for the notice to be put in writing is to avoid endless disputes which may arise as to whether or not such notice has been given.

One can only too easily visualise a woman claiming that she told the wages clerk or the head of the typing pool, or even, dare I mention it?, a shop steward, or somebody who seemingly has authority, but in fact does not; this person may or may not realise the import of what was being said, and equally may or may not act on the information which was being given to him or her. The gravity, or at any rate the importance, of the situation is exemplified if one considers the provisions that follow once a woman has intimated her intention to return that is to say, the possibility of unfair dismissal and redundancy claims and all the sums of money involved in such processes.

My submission is that it is surely right that a woman should give notification in writing if she intends to exercise her right. It is not sufficient to provide that the notice shall be in writing if requested. Junior clerks and heads of typing pools will not know, and in any event may feel thoroughly embarrassed at having to make the request, and especially in the big organisations. If the notice is put in writing, then, of course, the boot is on the other foot, because there is no excuse for an employee, even of a fairly junior rank, not pushing the notice, if I may so describe it, up to the correct level. If the lady, or the woman as we have to call her for these purposes, has gone sufficiently high up the hierarchy of the organisation or the management in the first instance, it probably would not be necessary to put the notice in writing. But we cannot always legislate for that and there is no means of knowing, so far as the individual employee is concerned, who is the right person to tell.

By way of reinforcing the argument, what is now Clause 42 requires an employer who takes on a temporary replacement to notify that replacement in writing of her temporary status. What is sauce for the goose ought surely to be sauce for the gander, so that this similar obligation put on the employer in that part of the Bill should in this particular context be put on the employee in this clause. I beg to move.

4.41 p.m.

Lord JACQUES

The present wording, which requires notice in writing if the employer so requests, was introduced as a result of an undertaking given in Committee in the House of Commons and was accepted by the Opposition as meeting their point. I wonder how many Opposition points we have to meet. We thought we had met the point raised in Committee in the House of Commons, where it was acknowledged that we had met it. We feel that the wording, which is flexible, is the one most likely to be satisfactory in practice.

In the very small company, where there are few employed and they work closely together, it is seldom that all these things are put in writing, but in the larger concern there are usually staff regulations which deal with such matters as sickness, and so on, which indicate what has to be put in writing and what has not to be put in writing. If the employer wanted, he could get this put into writing. All he has to do is to say so in his staff regulations. Therefore, we feel that in the draft as we have it at the moment we are catering for the very small firm which does not require it in writing, and for the very large firm which can have it in writing if it so wishes. On balance, we feel that it is better to leave it as it is now, which apparently satisfied the noble Lord's colleagues in another place.

Lord DRUMALBYN

Perhaps our colleagues in another place had not quite the same amount of time to consider the matter as we have had. There are good reasons for requiring this information to be put in writing. The obvious one is that if there is a dispute about the facts then there is a piece of paper in evidence, or alternatively there is no piece of paper in evidence, and therefore the tribunal will draw its conclusions accordingly. Surely it will avoid a great deal of trouble if this is required to be put in writing.

I was rather expecting the noble Lord to say, "Surely the woman who is giving the information on pregnancy would not necessarily know that she has to put it in writing". I would not for a moment accept that argument. This is the sort of thing that women talk about—and I understand they talk quite a lot among themselves—and it is inconceivable that a woman would not know that she had to put this in writing if it was so required, and that is the only objection that could be made to the omission of the words, "if he so requests".

The noble Lord says that it will give greater flexibility in smaller firms. Even smaller firms have to take account of what the Statute actually says, and women in smaller firms will also observe them. I can see no objection at all to this. If we were always to agree on either side of the House with what is said in another place and the way in which Amendments are received in another place, there would not be any point in having two Houses. I hope that the noble Lord will not use that argument again.

There is a difficult point here because this is a serious matter, and a matter on which there should be firm evidence. On this depends whether the woman making the application, and when giving the information, is going to be entitled to her maternity pay and whether she is going to enjoy the right of return to her job. These matters are so important that they ought to be put in writing. You cannot leave them to the chance memory of some employee. They really ought to be properly dealt with. I cannot see any possibility of things not going wrong unless we have a provision of this sort and these words are left out.

In any case, I think this provision will give rise to difficulties, because what the employee has to do is to state her intention of returning to work. I am not at all certain that she will even know whether or not she intends to return to work at the time she gives her notice. We are bound to accept that some women will not be quite honest about the intention they express, either because they have not made up their minds or because they think that it does not very much matter. All that would happen in that case is that the employer would pay out the maternity pay and the woman would not return to work anyway.

In view of the clauses we are coming to, it will be the State who will be in difficulty here, and I think that we have to have regard to public expenditure in this way. This is going to cause difficulty, and I hope that between now and the next stage the noble Lord will look at the whole principle involved in this subsection. It is important that we should get this right, otherwise trouble is bound to arise, as it has arisen in other parts of the social services before, simply through a lack of clarity of facts and of intentions. So far as this Amendment is concerned, I hope that my noble friend will press it.

The Earl of MANSFIELD

May I first reject the argument put up by the noble Lord, Lord Jacques, that because a particular Amendment was accepted in the other place we are in some curious way estopped from pressing the matter again in your Lordships' House. Even the most cursory reading of Hansard will reveal the pressures under which the other place works, and surely the whole basis of your Lordships' role as a Revising Chamber is to reconsider what has happened in the other place and, if necessary, to seek to revise and improve legislation still further. The fact that my right honourable friend was content in Committee stage in another place is neither here nor there.

I was disappointed that the noble Lord, Lord Jacques, made no attempt to deal with the merits of this Amendment. I tried to point out to him that biologically speaking the people who are going to make the request are going to be young, and they are probably going to be in comparatively junior positions, although that does not necessarily follow. I tried to point out that the difficulty of proving whether or not a request has been made, and the form in which it is made, will be extremely difficult to unravel at a later stage, if indeed it has to be. As my noble friend Lord Drumalbyn has remarked, it is a question of public money. In my submission, it will be totally unsatisfactory if some young lady says she thinks she will go off because she is not feeling very well and at a later stage someone seeks to claim, as they are likely to do, that that was notice that she was pregnant and that after her absence she wanted to come back again. These are the practical difficulties which will rear their heads, and whether the firm concerned is

large or small, the difficulties will still be there. The noble Lord was less than helpful when he replied, and I will therefore test the matter in the Lobby.

4.50 p.m.

On Question, Whether the said Amendment (No. 17) shall be agreed to?

Their Lordships divided: Contents, 123; Not-Contents, 68.

CONTENTS
Aberdare, L.	Fraser of Kilmorack, L.	Nugent of Guildford, L.
Alexander of Tunis, E.	Gisborough, L.	Ogmore, L.
Amherst of Hackney, L.	Glasgow, E.	Orr-Ewing, L.
Amory, V.	Goschen, V.	Platt, L.
Balerno, L.	Grenfell, L.	Rankeillour, L.
Balfour, E.	Gridley, L.	Reigate, L.
Barrington, V.	Grimston of Westbury, L.	Robertson of Oakridge, L.
Beaumont of Whitley, L.	Haig, E.	Robson of Kiddington, B.
Belstead, L.	Hankey, L.	Rochdale, V.
Berkeley, B.	Harmar-Nicholls, L.	Rockley, L.
Boyd of Merton, V.	Hawke, L.	Ruthven of Freeland, Ly.
Brentford, V.	Hayter, L.	St. Aldwyn, E.
Bridgeman, V.	Henley, L.	St. Davids, V.
Byers, L.	Hereford, V.	Sandford, L.
Caccia, L.	Hives, L.	Sandys, L.
Camoys, L.	Hornsby-Smith, B.	Seear, B.
Campbell of Croy, L.	Hylton-Foster, B.	Selkirk, E.
Carrington, L.	Ironside, L.	Sempill, Ly.
Cathcart, E.	Kemsley, V.	Sharples, B.
Clifford of Chudleigh, L.	Killearn, L.	Sinclair of Cleeve, L.
Clitheroe, L.	Kimberley, E.	Somers, L.
Colville of Culross, V.	Kintore, E.	Stamp, L.
Cornwallis, L.	Lauderdale, E.	Strathclyde, L.
Cottesloe, L.	Lindsey and Abingdon, E.	Strathcona and Mount Royal, L.
Croft, L.	Long, V.
Cromartie, E.	Lonsdale, E.	Strathspey, L.
Daventry, V.	Loudoun, C.	Stuart of Findhorn, V.
de Clifford, L.	Lyell, L.	Suffield, L.
Denham, L. [Teller.]	Malmesbury, E.	Swansea, L.
Deramore, L.	Mancroft, L.	Swaythling, L.
Drumalbyn, L.	Mansfield, E.	Tenby, V.
Dundee, E.	Margadale, L.	Terrington, L.
Eccles, V.	Massereene and Ferrard, V.	Tranmire, L.
Effingham, E.	Merrivale, L.	Vickers, B.
Elles, B.	Mersey, V.	Vivian, L.
Elliot of Harwood, B.	Meston, L.	Wade, L.
Elton, L.	Monck, V.	Wakefield of Kendal, L.
Emmet of Amberley, B.	Monk Bretton, L.	Ward of North Tyneside, B.
Falkland, V.	Mottistone, L.	Wigoder, L.
Ferrers, E.	Mountgarret, V.	Wise, L.
Ferrier, L.	Mowbray and Stourton, L. [Teller.]	Young, B.
Fortescue, E.
NOT-CONTENTS
Arwyn, L.	Crook, L.	Kirkhill, L.
Aylestone, L.	Crowther-Hunt, L.	Leatherland, L.
Bacon, B.	Darwen, L.	Lee of Newton, L.
Bernstein, L.	Delacourt-Smith of Alteryn, B.	Llewelyn-Davies of Hastoe, B.
Beswick, L.	Douglas of Barloch, L.	Lloyd of Hampstead, L.
Birk, B.	Douglass of Cleveland, L.	Lovell-Davis, L.
Blyton, L.	Elwyn-Jones, L.	Lyons of Brighton, L.
Brockway, L.	Fisher of Camden, L.	McLeavy, L.
Buckinghamshire, E.	Gaitskell, B.	MacLeod of Fuinary, L.
Burntwood, L.	Geddes of Epsom, L.	Maelor, L.
Burton of Coventry, B.	Goronwy-Roberts, L.	Mais, L.
Champion, L.	Hale, L.	Melchett, L. [Teller.]
Chorley, L.	Houghton of Sowerby, L.	Paget of Northampton, L.
Collison, L.	Hoy, L.	Pannell, L.
Cooper of Stockton Heath, L.	Jacques, L.	Peddie, L.
Phillips, B.	Segal, L.	Strabolgi, L. [Teller.]
Pitt of Hampstead, L.	Shepherd, L. (L. Privy Seal.)	Summerskill, B.
Popplewell, L.	Shinwell, L.	Taylor of Gryfe, L.
Raglan, L.	Slater, L.	Taylor of Mansfield, L.
Rhodes, L.	Snow, L.	Wells-Pestell, L.
Roberthall, L.	Stedman, B.	Winterbottom, L.
Rusholme, L.	Stewart of Alvechurch, B.	Wynne-Jones, L.
Sainsbury, L.	Stow Hill, L.

On Question, Amendments agreed to.

Resolved in the affirmative, and Amendment agreed to accordingly.

5.0 p.m.

Lord JACQUES

I spoke to Amendment No. 18 on Amendment No. 14. I beg to move.

Amendment moved— Page 29, line 24, leave out ("both").— (Lord Jacques.)

Clause 35, as amended, agreed to.

Clause 36 agreed to.

Clause 37 [Calculation of maternity pay]:

Lord DRUMALBYN moved Amendment No. 19: Page 30, line 29, after ("pay") insert ("or £72 whichever is the less").

The noble Lord said: So far as I know, this is a matter which has not been discussed in principle. I believe that there is a principle here which ought to be considered. In case I waste the time of the House, perhaps I should ask whether I am right in thinking that there is no limit on the amount of a week's pay on which maternity pay is calculated?

Lord JACQUES

There is none.

Lord DRUMALBYN

That being so, I believe that it is worth discussing this as a matter of principle. It appears to me to be the first time that benefits are to be provided by Statute without an upper limit in a case where they have not been earned by contributions. It is also noteworthy that there are already upper limits for redundancy pay and that, under the Bill, upper limits are proposed for compensation for unfair dismissal. Of course I freely admit that the case is clearly distinguishable from guaranteed payments where payments arise out of the action of the employer in laying off the employee, though there also a guaranteed payment is limited to £6 a day under Clause 25. It is also distinguishable from the right to a remuneration where an employer suspends an employee from work on medical grounds because the suspension is due to and arises out of the employee's work. That is the reason why it is distinguishable: it arises out of the employee's work.

In both these cases it is the employer who pays, whereas under the provisions we are about to discuss it will be the State which ultimately pays, through the employer. It could be argued that, since the woman who receives maternity pay is a taxpayer and contributes more in taxes the higher her remuneration, she should be entitled to pay which is related to her remuneration which, I take it, is subject to taxation, though I was not quite clear about this following the closing proceedings on the Bill last night.

The fact remains that this would be a new principle in State benefits and, clearly, maternity pay will be a State benefit, in effect if not in name, if the Government Amendments are accepted. No doubt when the Government decided on these provisions for maternity pay they had in mind mostly the needs of women whose earnings did not exceed the national average for weekly earnings, but it is by no means exceptional for women to become pregnant in their thirties or even their forties when they are at the top of their earning capacity and are holding highly-paid jobs. I am aware that the employers of many such women give them leave on full pay for a generous period when they become pregnant. No doubt they will continue to do so, but there is no reason why a statutory liability to provide maternity pay should depart from the normal provisions relating to statutory benefits, whether the financial burden falls on the employer or on the State.

As I said, the case is clearly distinguishable from benefits in respect of disabilities arising in the course of employment. I do not believe that it very often happens that maternity pay arises in the course of employment. I am moving the Amendment with an open mind, but I feel that the case for having no limit needs to be made out and I am therefore giving the Government this opportunity to make it out. I beg to move.

Lord JACQUES

At the outset I should say that maternity pay will be subject to tax. The issue is clearly two-sided. The noble Lord, Lord Drumalbyn, has properly put one side of the case—that is, the case for limiting—and I shall put the other side. The Amendment provides that no person shall receive more than £72 a week in maternity pay. This means that any person who is earning more than £80 a week would not receive the full nine-tenths otherwise provided for. The maternity pay provisions are designed to ensure that any employee will continue to receive her normal income for the short period of six weeks after leaving work. The aim is to prevent a sharp drop in income during the latter stages of pregnancy in order to minimise the problems facing women at that time. Any reduction in income during the period of maternity pay would undermine the principle.

I believe that one effect of the Amendment which the noble Lord has overlooked is that many of the women who receive higher salaries are already covered by contract for their absence. Under the Bill as it stands and subject to the funding, the employer would be able to claim at least six weeks of the benefit from the Maternity Fund, but he would have to bear any addition to the six weeks which he had given by contract. However, if the Amendment were carried, he would have to bear the whole amount over the £80. In the case of the higher salaried woman, that could be quite substantial and the employer would get no relief in that respect from the Maternity Fund. So it is not in the interest of the employer who is under contract to those in the higher salary scales that this should be done.

Lord DRUMALBYN

I understand the point that has been made by the noble Lord, but I was not considering whose interest was served. Rather, it was the effect on State benefits and the general principles applying to them. The employer will not be losing in any way because the kind of employer to whom the noble Lord referred will not lose—all that will happen is that he will not gain, so to speak. He will no thave the maternity pay for the six weeks rebated to him by the Secretary of State. He will not be losing anything on what is happening just now. That is not a consideration which it is really proper to take into account. The Government ought to think very carefully about where this could lead; perhaps they have already done so. I am quite certain that there will be different opinions within the Government on this matter. At any rate, I think it desirable to bring to the notice of the Committee what we are doing here, and I do not intend to vote against the clause on this account. But now we know exactly what we are doing. I beg leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Clause 37 agreed to.

Clause 38 agreed to.

5.12 p.m.

Lord JACQUES moved Amendment No. 20: After Clause 38 insert the following new clause:

Maternity Pay Fund

".—(1) There shall be established under the control and management of the Secretary of State a fund to be called the Maternity Pay Fund out of which payments shall be made in accordance with the following provisions of this Act.

(2) The Secretary of State shall prepare accounts of the Maternity Pay Fund in such form as the Treasury may direct and shall send them to the Comptroller and Auditor General not later than the end of the month of November following the end of the financial year to which the accounts relate; and the Comptroller and Auditor General shall examine and certify every such account and shall lay copies thereof, together with his report thereon, before Parliament.

(3) Any money in the Maternity Pay Fund may from time to time be paid over to the National Debt Commissioners and invested by them, in accordance with such directions as may be given by the Treasury, in any such manner as may be specified by an order of the Treasury for the time being in force under section 22(1) of the National Savings Bank Act 1971."

The noble Lord said: We now come to the Amendments which are concerned with funding. The Government have been under some pressure both inside and outside Parliament regarding the funding of maternity benefits; that is to say, to arrange that all employers should contribute to a fund out of which claims could be made. Those who have advocated this have had different points in mind, but one of the most common has been the safeguarding of the small employer who employs a high proportion of women of child-bearing age. The position of the employee has also to be borne in mind. It may be that if we did not have funding there would be some difficulty, in certain circumstances, on the part of a woman of child-bearing age in getting employment; or it may be made more difficult for her to get employment, because of the fact that there was a maternity benefit which would fall directly upon the employer concerned.

In an exchange in the other place, the Opposition made it categorically clear that they were seeking to fund the cost of maternity, but they were not seeking to transfer any part of the cost from employer to employee; and we hope that that categorical statement will be accepted in this House. We are proposing changes bearing in mind that assurance which was given to us. When the Bill came to this House, we had two Amendments on this point, one from the noble Baroness, Lady Vickers, and another from the noble Baroness, Lady Seear. Those have been among the alternatives that have been considered. But we also had to bear in mind whether or not it would be constitutionally proper to introduce into this House Amendments which would involve taxation, and we have been assured that these Amendments dealing with finance can be introduced in this House, provided that they are accepted in due course in another place.

After considering all the various alternatives available, we have decided on a scheme which is as close as possible to the redundancy scheme, and the details for funding which are before the Committee have been modelled on the redundancy scheme. The scheme embraces the establishment of a maternity fund financed by contributions from all employers who pay secondary Class 1 contributions. The employers will pay the claims made by employees and will get a full refund, which will be known as a rebate. At the present time, it is expected that the cost by way of contributions would be 0.04 per cent. of wages. But we must bear in mind that the scheme is not to come into operation until April 1977, when it will come into operation in relation to both contributions and claims at the same time.

We believe that between now and that date it is extremely likely that women's wages will increase as a percentage more than the general wage level will increase. Consequently, we believe that the contribution is likely to be 0.05 per cent. rather than 0.04 per cent., because of the change which we anticipate will take place between now and April 1977. But even at 0.05 per cent. that is only £1 in every £2,000 paid in wages. The contributions will have to cover, first, the £14.5 million which we anticipated would be the cost of the scheme. But in ascertaining the cost of the scheme, we ignored the benefits which were already being paid under contract by employers. They will continue as before to pay under their contract with the employee, and therefore that was not a new cast on industry, but it will be a cost upon the maternity pay fund. We estimate that at present employers are paying the amount of £2.5 million by way of maternity benefit under contract which in the future will have to be borne by the maternity pay fund, so that the total cost will be £17 million.

I come now to the question of administrative costs. The Department of Employment pays the Department of Health and Social Security for the contributions it collects on behalf of the Department of Employment, and it pays at a percentage rate. For example, the Department of Health is the collecting agent for the Redundancy Fund, and a percentage of that is retained by the Department of Health as a contribution towards the cost of the collections. That is assessed on a percentage basis. On that percentage basis, there would be an additional payment by the Department of Employment to the Department of Health of £300,000 as a contribution to the cost of collection.

Since there will be an increase only in the percentage that has to be deducted by employers, the amount of additional work involved will be negligible. The additional cost will be negligible—obviously something well below the £300,000. But let us put it at its worst and say an additional cost of £300,000, because we have to collect the money for the Fund. We have now to turn to the question of the administrative costs arising out of the payments from the Fund. It is estimated that there will be 220,000 claims per year, and on the basis of the Ministry's experience in the handling of Redundancy Fund claims we estimate that it will cost £600,000 to receive, check and pay those claims.

So the total administrative costs of the fund would be, at a maximum, £900,000; that is, approximately 5 per cent. I would say that the real cost to the State is likely to be substantially less than that, because, although there will be a payment of £300,000 from one Ministry to the other in respect of the additional contributions, the actual cost is likely to be something much smaller than that; so it may well be that the real cost will be something between 3 per cent. and 4 per cent., rather than the 5 per cent.

That gives a brief outline of the scheme, but since I am dealing with Amendment No. 20 I should like to explain to the Committee what the subsections of this Amendment would do. Subsection (1) provides for the establishment of the Maternity Pay Fund, from which payments may be made to employers who have made maternity payments or to employees who are entitled to maternity pay and have not received it. Subsection (2) provides for the preparation and certification of the accounts of the Fund, and for copies to be laid before Parliament. Subsection (3) provides that money in the Fund may be paid over to the National Debt Commissioners for investment by them in accordance with directions by the Treasury. When we come to the other Amendments, Nos. 21 to 28, I will, if it is the wish of the Committee, explain the meaning of each subsection. At this stage I beg to move Amendment No. 20.

Baroness ELLES

First, I should like to thank the noble Lord, Lord Jacques, for his explanation of the new Maternity Pay Fund which the Government have been willing to set up; and certainly we on this side of the Committee should like to thank most deeply and sincerely the noble Baroness, Lady Vickers, for having originally introduced, when the Bill was in Committee, an Amendment in relation to the setting up of a Maternity Pay Fund, and also for the efforts that she has made, with the Government, to reach this stage. Certainly, I think it is only the noble Baroness, Lady Vickers, and also the noble Baroness, Lady Seear, who have worked so hard in the cause of women, who would have had the tenacity and perseverance to reach this stage, and I know that women who will be benefiting from this maternity allowance will be grateful to them.

So often have we heard from the other side of the Committee the phrase "to be in line with the EEC". It is a very convenient yardstick when we on this side want to differ from them; but in this case, of course, we are way behind any of the EEC countries with regard to any of the maternity legislation in this country, whether it is with regard to unfair dismissals, to the right to return to work, to the maternity allowance or to how much or to whom. In every aspect of maternity legislation we are miles behind, and even with this Bill we shall still be miles behind. I hope that this is a first step towards an improvement in the maternity provisions in this country.

First, I should like to ask one or two questions of the noble Lord on points which have not been made quite clear to me, particularly with regard to two points that he raised. The first is the question of cost. I understand that the cost of the scheme is to be £14.5 million and that the rate of contribution of an employer will be.04 per cent. of wages. Could the noble Lord quantify this in terms of how much per week this would mean an employer would pay per employee, so to speak? When he says, ".04 per cent. of wages", does that mean total wages or does it mean average wages? What does it mean? What does it mean in terms of pounds and pence per week to an employer by way of contribution additional to that which he is already paying? Secondly, I must ask the noble Lord why it is to take until April, 1977, to be put into force. It seems to me that this is the kind of legislation which should be hurried rather than delayed. We have seen several cases in this Bill of payments being made to employees which could equally well have been put off until April, 1977, but I see no reference to delay in the payment of such compensations and funds. I do not really know why it is to take such a long time to reach that stage, and I would ask the Government whether it is possible to advance this and to start payment from this Fund in April, 1976, at least. If not, could they kindly give reasons why not?

Thirdly, I should like to comment on the cost of receiving, checking and making these payments. As I understood it—and I hope I was wrong—the cost is to be £600. Is that £600 per payment? Because it seems to me very much more than the woman will ever receive. It seems to me a curious imbalance if it is to cost the Department £600 and the woman is to receive £350. There seems to be something wrong either with the administration or with the amount of money that she is to get. I wonder whether I could have some clarification of that. Fourthly, I would ask the noble Lord to qualify his figure of 220,000 claims per year. I imagine—but perhaps he can correct my impression—that it is based on the number of maternity benefits which are now being paid under the National Insurance provisions. I understand that there are something like 220,000 cases of maternity benefit being paid each year. But the noble Lord will notice—and his is something which, of course, I would contest eventually, when we have an opportunity, when we are in Government, to produce some more up-to-date legislation on this matter—that it would not be necessary for a woman to have been in work for a period of at least two years. These 220,000 who are receiving maternity benefit have only to have made, I think, 26 contributions in order to qualify for maternity benefit. So I would suggest that possibly this figure of 220,000 is higher than the number which will be eligible for this maternity pay. Perhaps the noble Lord could comment on this.

Otherwise, in principle, of course, we on this side of the Committee are very much in favour of maternity allowances being paid. I think this is a very good contribution to a family policy which will enable a woman, or anyway help a woman, to stay at home to look after her child. It is, of course, not enough. It is not for a long enough period and it does not protect her sufficiently, but it goes some way towards answering the problems raised by the Child Poverty Action Group with regard to the one-parent family, the unmarried mother and also those with low wages and where the woman has been working and her wage is lost to the family budget when she is pregnant. I would be grateful if the noble Lord could answer the points that I have raised, but I should again like to say from these Benches that we thank most sincerely the noble Baroness, Lady Vickers, and we hope that this is the beginning, at least, of better and further protection for women who have children.

5.30 p.m.

Lord JACQUES

May I make clear one or two of the points that have been raised. First, in regard to the cost, the cost will not be £14.5 million; that was the cost of the scheme. The maternity fund will be liable for more than the cost of the scheme; it will be liable for the payments which employers were already making voluntarily. Consequently, the cost will be £17 million. The contribution by the employer will be 0.05 per cent. of wages below the £69 limit, the same as any other secondary Class 1 contribution. It will not be on the total wages but on wages below the limit set at any point in time. At the present time, it is the £69 limit.

So far as the cost of dealing with claims is concerned, I think that I probably said £600 instead of £600,000. It is £600,000. The number of claims to be dealt with will be 220,000. So far as the date of commencement is concerned, until today everybody has been shouting from the other side of the Committee, "Delay this as much as you can! It is a cost upon industry, and we must not have too much cost on industry—especially at the present time." Consequently we gave undertakings all over the place that this scheme will not come into operation until 1977. Now, because it is going to be funded, everybody wants it in operation tomorrow. It is still going to be borne by the employers, just as much as it was borne by the employers before. The difference is that it is going to be spread over.

Furthermore, we cannot put the whole Bill into operation at once. If we are going to start this new fund time must be allowed in order to prepare for the work that has to be done, to prepare and train the staff that will be involved in dealing with the Fund. There will be 140 staff dealing just with claims; so you must have time in order to do the work involved. I think that it is not reasonable to say that it will be put into operation in April 1977. Those, I think, were the points raised by the noble Baroness. I hope she is satisfied with the replies.

Baroness SEEAR

Since reference was made by the noble Lord to the Amendment that I put forward at Committee stage, I should like to say from these Benches that we consider the Government proposals a very great improvement on what was previously in the Bill. This will make a much more satisfactory plan than was previously proposed. Having said that, however, I do not think that I shall let the Minister get away with his complacency in bringing it into operation as late as 1977. To say that we ought to be consistent because we had argued that this was to be too heavy a cost on the employers is to miss the point. It was going to be a very heavy cost on a relatively small number of employers. One of the great improvements in the Government's proposal is that the cost is going to be more widely spread. Whereas a heavy additional charge in, for example, the clothing and textile industry might well have been the last straw to break the back of the already wilting camel, to have this relatively small cost spread across the whole of industry is another matter. That argument does not hold. Secondly, to say that the highly-skilled British civil servants will need from now until 1977 to learn how to pay out a maternity benefit is something I cannot swallow.

Baroness PHILLIPS

I have rarely heard a more ungracious speech than that from the noble Baroness on the Front Benches opposite. Of course we pay tribute to the noble Baronesses, Lady Vickers and Lady Seear, but I would remind the Party opposite that when I had the privilege of sitting on the Front Benches opposite I cannot recall one occasion during the passage of the Social Security Bill when they gave way on any Amendment at all. I am on record as saying this. Surely the Government have given way on this Amendment and the least that the noble Baroness could have done would have been graciously to accept it rather than taking it in this grudging way. This is a major step forward. It would have been nice if the Party opposite had introduced some of these far-reaching measures when they were in Office for three years and had the opportunity to do so.

ord DRUMALBYN

I think it is a little unfortunate that the noble Baroness should talk about the grudging attitude of my noble friend. Speaking as a woman, she naturally regretted that this kind of provision had not been introduced before, wanted to have it accelerated as much as possible and was sorry that it should take 18 months to introduce. I do not think that that is grudging. She welcomed the provision as much as we all do.

The real question was how it should be paid for. The provision was to be made anyway and the question was how to pay for it. As the noble Baroness, Lady Seear, has said, this is an obviously better way of paying for it because it spreads the liability more widely and it also makes it clear to everybody concerned that this is not something that they depend on as a charity from the employers, being paid for not working, but something that they are entitled to by an Act of Parliament and which is paid for by the State. We agree with this and I welcome it. I hope that the noble Baroness, Lady Phillips, will not feel that we are really grudging in our acceptance of this. We welcome it very much but I think my noble friend was entitled to say that she would have liked it to come into operation sooner. If I may say so, I think that the noble Baroness, Lady Phillips, would have said the same if she had been on this side.

Lord HOUGHTON of SOWERBY

My noble friends on the Government Front Bench have realised by now that it does not matter what they do they will not give complete satisfaction. I do not think that we ought to be ungracious about the significant change which the Government have made in their proposals. They do not give me complete satisfaction, either: but this is a great improvement on what was in the Bill before. Some of us—the noble Baronesses, Lady Vickers and Lady Seear—pointed out how the proposals to put the burden of maternity payments on individual employers might have been highly discriminatory against the employment of women and especially among the small employers who rely mainly on the employment of women.

On the question of the effective date, I thought that in any case it was to be April 1977 because the change which the Government propose, to spread the cost of the scheme widely over employers generally, did not of itself justify bringing the scheme into operation at an earlier date than that originally contemplated. I thought—I may have been mistaken— that the 1977 date was related to other changes which were to be made in family endowment under other Acts of Parliament; with regard to family allowances, for example. I thought that the idea was to bring these changes together at a date which would be a little removed from the immediate economic crisis through which we are now passing. We have to bear in mind that we are supposed to be going through the gravest economic crisis since the War. That is certainly true when one looks at the situation realistically, despite a chink of light which seems now to be showing and which is most welcome. For myself, on the general principle of spreading the cost over employers generally, it is still difficult to accept that this is a liability wholly for employers. Sickness benefit, unemployment benefit, other things related to employment, industrial injury and disease, are all paid for jointly by contributions under the social security scheme. Redundancy is in a class by itself and arises directly out of conditions of employment.

As I pointed out in an earlier debate, when a woman becomes pregnant it is not usually anything to do with the employer! It is not clear that it is a hazard of employment! it is usually a hazard of activities outside employment! I am not convinced that this is something that the employer should wholly pay for. The compensation for this period, and probably for a longer period, is fully justified. I agree with the noble Baroness who spoke from the Front Bench opposite: we are still behind the EEC. The six weeks period is probably not long enough. These improvements may come later, when we are in a more affluent position. I am not clear why the Opposition in another place insisted that no part of the cost of this scheme should fall upon the employee. It seems to me to be essentially a benefit of employment which comes within the general ambit of a social security scheme. I am not going to make a point of this now because the spread over employers generally really meets the main objection to the original proposals.

We ought not only to compliment the noble Baroness, Lady Vickers and Lady Seear (both of whom have played a significant part in bringing about this change), but congratulate the Government on introducing into your Lordships' House a significant change in the Bill. Little hope of being able to accomplish this improvement in the remaining stages of the Bill was expressed in another place. For once in a while I will offer my humble congratulations to my noble friends on the Front Bench.

Baroness VICKERS

May I say to the noble Lord, Lord Jacques, how grateful I am to him for putting down this Amendment, and also for the kindness which he and the Secretary of State for Employment showed me when I discussed this matter with them during the Recess. Following on what the noble Lord, Lord Houghton of Sowerby, said, at column 139 of Hansard on 22nd September, I said that it was my intention that the sum should be paid by employees as well under the Class 1 and Class 2 contributions. The decision has been made now that it shall come on the employers. In fairness, when I went to the Ministry, having said at column 139 of Hansard on 22nd September that I could put down Amendments to the Social Security Act 1975, I took along the details which I gave to the noble Lord, but he came down in favour of this type of payment. I am not criticising him, but I should like to say I gave the choice as I originally said, and I kept my word in so doing.

I am glad that we are going to have the Fund. I have received letters saying that it will save local authorities a considerable amount of administrative work, and I have also received letters from private employers as well. I wish this Fund success. As time goes on and everything can be improved—we may be able to get some of the improvements suggested by my noble friend Lady Elles and catch up with the EEC. Finally, I should like to express my gratitude to the Government for what they have done.

Baroness ELLES

Just to put the record right, I hope the noble Baroness, Lady Phillips, does not feel I was ungrateful to the Government. I think the noble Baroness will find on reading Hansard that I certainly welcomed this as a basis for family policy. Although I said, and I say again—and I have been supported by the noble Lord, Lord Houghton of Sowerby—that it does not go far enough, I welcome it as a first step in order to protect cases of maternity. I know the noble Baroness will agree that this is one of the categories in our society which have so far not had their fair share of the cake. From these Benches we welcome this Maternity Pay Fund, and we hope it will provide greater support for women in the future.

Lord JACQUES moved Amendment No. 21: After Clause 38 insert the following new clause:

Financing of Maternity Pay Fund

".—(1) In the Social Security Act 1975 for the words "appropriate allocation to the Redundancy Fund", wherever they occur, substitute the words "appropriate employment protection allocation".

(2) In section 1(1) of that Act (outline of contributory system), after the words "Redundancy Fund" insert the words "and the Maternity Pay Fund".

(3) In section 4(6)(b) of that Act (amount of secondary Class 1 contribution), for the words "8.5 per cent." substitute the words "8.55 per cent".

(4) In section 122(4) of that Act (power to alter contrbutions), after the words "the Redundancy Fund" insert the words "or the Maternity Pay Fund", and for the words "that Fund" substitute the words "either or both those Funds".

(5) In section 134 of that Act (destination of contributions etc.)—

1. (a) in subsection (4), for the words "0.2 per cent." substitute the words "0.25 per cent."; and
2. (b) in subsection (5)(b), for the words "that Fund" substitute the words "the Redundancy Fund and the Maternity Pay Fund in such shares as the Secretary of State may, with the consent of the Treasury determine."

(6) In Schedule 20 to that Act (glossary of expressions), at the appropriate place in alphabetical order insert in the first column the entry "Appropriate employment protection allocation" and against it in the second column insert the entry "See section 134(4)"."

The noble Lord said: This Amendment seeks to make the necessary amendments to the Social Security Act 1975. For example, subsection (1) amends the Social Security Act 1975 by replacing references to the Redundancy Fund with references to employment protection allocations which would cover both the Redundancy Fund and the Maternity Fund. The other subsections cover similar innocent matters and it may be for the convenience of the Committee if I do not read out my full brief. I beg to move.

5.45 p.m.

Lord JACQUES moved Amendment No. 22: After Clause 38 insert the following new clause:

Advances out of National Loans Fund

".—(1) Subject to the provisions of subsections (2) to (4) below, the Treasury may from time to time advance out of the National Loans Fund to the Secretary of State for the purposes of the Maternity Pay Fund, such sums as the Secretary of State may request; and any sums advanced to the Secretary of State under this section shall be paid into that Fund.

(2) The aggregate amount outstanding by way of principal in respect of sums advanced to the Secretary of State under subsection (1) above shall not at any time exceed £4 million, or such larger sum, not exceeding £10 million, as the Secretary of State may by order made with the consent of the Treasury determine.

(3) No order under subsection (2) above shall be made unless a draft of the order has been laid before Parliament and approved by resolution of each House of Parliament.

(4) Any sums advanced to the Secretary of State under subsection (1) above shall be repaid by the Secretary of State out of the Maternity Pay Fund into the National Loans Fund in such manner and at such times, and with interest thereon at such rate, as the Treasury may direct."

The noble Lord said: This clause provides for loans to be made out of the National Loans Fund to the Maternity Pay Fund. The first subsection gives the Treasury power to advance money out of the National Loans Fund to be paid into the Maternity Pay Fund at the request of the Secretary of State. Subsection (2) limits the total amount of loan outstanding at any one time to £4 million. The subsection gives the Secretary of State power, by order, to increase the amount of the outstanding loan to not more than £10 million, with the consent of the Treasury. Subsection (3) provides that an order under subsection (2) must be made by the Affirmative Resolution procedure. Subsection (4) provides for repayment of any sums loaned out of the National Loans Fund.

Lord JACQUES moved Amendment No. 23: After Clause 38 insert the following new clause:

Maternity pay rebate

". (1) subject to section (Reduction of rebate in certain cases) below and to any regulations made under this section, the Secretary of State shall pay out of the Maternity Pay Fund to every employer who makes a claim under this section and who being liable to pay, has paid, maternity pay to an employee, an amount equal to the full amount of maternity pay so paid (in this section and sections (Payments to employees out of Maternity Pay Fund), (Reduction of rebate in certain cases), (Supplementary provisions in relation to employer's insolvency) and (Complaint and appeals to industrial tribunal) below referred to as a "rebate").

(2) The Secretary of State may if he thinks fit, and if he is satisfied that it would be just and equitable to do so having regard to all the relevant circumstances, pay such a rebate to an employer who makes a claim under this section and who has paid maternity pay to an employee in circumstances in which, by reason of the time limit provided for in section 38(2) above, a complaint by the employee has been dismissed, or would not be entertained by an industrial tribunal.

(3) For the purposes of subsections (1) and (2) above, a payment of contractual remuneration by an employer shall be treated as a payment of maternity pay to the extent that, by virtue of section 37(4) above,—

1. (a) it extinguishes the employer's liability to pay maternity pay; or
2. (b) in a case falling within subsection (2) above, it would extinguish that liability if a complaint by the employee were not time-barred as described in that subsection.

(4) The Secretary of State shall make provision by regulations as to the making of claims for rebates under this section and such regulations may in particular—

1. (a) require a claim to be made within such time limit as may be prescribed; and
2. (b) require a claim to be supported by such evidence as may be prescribed."

The noble Lord said: This Amendment provides for employers to receive a rebate from the Maternity Pay Fund to cover the cost of the payments of maternity pay that they have made to employees. I am of the opinion that it is not necessary to deal with the other subsections, but I will be happy to do so if the Committee so wishes. I beg to move.

Lord DRUMALBYN

This Amendment says: (2) The Secretary of State may if he thinks fit, …pay such a rebate to an employer who makes a claim under this section and who has paid maternity pay to an employee in circumstances in which, by reason of the time limit provided for in section 38(2) above, a complaint by the employee has been dismissed, or would not be entertained by an industrial tribunal. The clause envisages the case where the employer has paid maternity pay and a complaint has been made by the employee—these two conditions—to an industrial tribunal and the claim has been dismissed as being time barred. I do not quite understand what these circumstances would be. The Secretary of State must pay the employer the amount of maternity pay which the employer has paid unless it appears that the employer has paid more than he ought to have paid. I take it that such a case might arise, but it would not arise under this clause. May I ask the noble Lord whether it is envisaged that, although a complaint is time barred, the employer may nevertheless pay the woman the additional amount she is claiming? On what grounds would she be claiming the additional amount?

If the employer pays what he is asked because he recognises that the claim is justified—for example, because he has made a mistake—why should the Secretary of State reimburse him only if he thinks fit? Surely the Secretary of State should reimburse the employer if the complaint is justified. I certainly do not want to see an employee deprived of her due, but would not employers be less willing to meet time-barred claims if they were uncertain of being reimbursed by the Secretary of State? I simply do not understand the circumstances that are envisaged in this subsection.

Lord JACQUES

Subsection (2) enables the Secretary of State to give a rebate to an employer who has paid maternity pay to an employee whose claim to such pay is, or would be, time barred. The purpose here is to avoid hardship. It may have been the employee's fault that it is time barred. There may have been a mistake by the employer in paying it. We want to reach the position where every such case is looked at on its merits. In those circumstances, if an employer deliberately pays something which is time-barred then he does so at his risk, and I think that is right. He can in turn apply to the Secretary of State for the rebate, and if the Secretary of State feels it is just and reasonable for a rebate to be given—for example, because a mistake has been made—then the rebate can be paid. Your Lordships will find when we come to a later Amendment that there are adequate provisions made for appeal. Even when an employer has paid something which is time barred and the Secretary of State has refused a rebate, there is still a right of appeal in such a case against the decision of the Secretary of State. The main purpose here is to prevent hardship and to cover the possibility of a genuine mistake.

Lord DRUMALBYN

May I then ask the noble Lord what an employer should do in these circumstances where a complaint is time barred? Ought he then to approach the Secretary of State, put the case to him and get the agreement of the Secretary of State? If that were done, would the Secretary of State make the payment direct from the Maternity Pay Fund, or would the employer make the payment and be later rebated by the Maternity Pay Fund? The main point is: how can the employer make sure that he will be reimbursed? If he is told that he will not be reimbursed and then chooses to pay the money himself, that is fine, and obviously that is done at his own expense. But it seems to me hard on an employer if, where he thinks there is an open and shut case, even though time barred, or—let me put it this way—would be if it were not time barred, he makes the payment and then is not reimbursed by the Secretary of State simply because the Secretary of State takes a different view.

Lord JACQUES

Surely the noble Lord would agree that it would be slightly inconsistent to provide for all employers who pay claims which are time barred to have a rebate. If that were done, then it is no use having a time bar. There has to be some long-stop. At the same time, one has to prevent hardship, and so we are saying here that if an employer pays a claim which is time barred and the Secretary of State feels that it is just and reasonable to do so, he can rebate, even though the claim was time barred, whereas without this provision he could not rebate and it would fall on the employer. Returning to the first question: what should the employer do? If I were an employer and had a claim which was time barred, I should certainly consult the Secretary of State, which means consulting the local office and getting their approval. I should not have any doubt about that.

Baroness ELLES

I should like to ask the noble Lord whether any consideration was given to the payment of this maternity pay being made by the Government rather than by the employer. It seems to me that the employer is paying his contribution each week to the Maternity Pay Fund and at the same time the employee in fact will have left the employer during the time of her confinement, and she will be eligible for six weeks' pay while she is at home. Are there any statutory provisions for the way in which this is to be paid or when it is to be paid?—for example, whether it is to be paid in advance, at the end or weekly? I suggest that perhaps it might be more satisfactory if it were to be paid with maternity benefit, so that the process of payment is done in one exercise. There may be great difficulty for some women who live some way away from their place of employment in getting to the workplace during the six weeks they are away. It would also be difficult for the employer, particularly if he were a small employer with a small cash flow, suddenly to have to pay a new employee a wage as well as paying the maternity allowance, when he has already made his contribution to the Maternity Pay Fund and would, of course, be eligible for rebate—and I am talking of cases where he is perfectly willing to pay this amount. I should therefore like to ask the noble Lord whether any consideration was given to the Government's paying out the maternity allowance to a woman, rather than this being paid by the employer, who then has to claim the rebate later.

Lord JACQUES

The noble Baroness raised two questions. I believe the first was whether any consideration had been given to a State contribution—have I understood that correctly?

Baroness ELLES

No. I asked whether any consideration had been given to the implementation and the actual payment; that is, whether the actual payment would be paid through the DHSS or the Post Office, for example, to the woman who was eligible for the maternity allowance. I am not questioning the Fund itself, but only the method of payment to the woman, in order to avoid an employer, after having paid the allowance, having to claim a rebate from the Fund to which he has already contributed.

Lord JACQUES

In that case, there is only one question rather than two questions. That point was considered, but in the end we came down in favour of modelling the scheme on the Redundancy Fund. The machinery of that Fund is for the employer to pay and then to seek a rebate. We came to the conclusion that that was the best way of doing it.

5.59 p.m.

Lord JACQUES moved Amendment No. 24: After Clause 38 insert the following new clause:

Payments to employees out of Maternity Pay Fund

".—(1) Where an employee claims that her employer is liable to pay her maternity pay and—

1. (a) that she has taken all reasonable steps (other than proceedings to enforce a tribunal award) to recover payment from the employer; or
2. (b) that her employer is insolvent (as defined in section 60 below for the purposes of sections 55 to 59 below);

and that the whole or part of the maternity pay remains unpaid, the employee may apply to the Secretary of State under this section.

(2) If the Secretary of State is satisfied that the claim is well founded the Secretary of State shall pay the employee out of the Maternity Pay Fund the amount of the maternity pay which appears to the Secretary of State to be unpaid.

(3) Where the Secretary of State makes a payment under this section out of the Maternity Pay Fund—

1. (a) any rights and remedies of the employee in respect of the unpaid maternity pay or, if the Secretary of State has paid only part of it, in respect of that part, shall become rights and remedies of the Secretary of State; and
2. (b) any decision of an industrial tribunal requiring the employer to pay an amount to the employee in respect of maternity pay shall have the effect that the amount or, as the case may be, that part of it which the 838 Secretary of State has paid is to be paid to the Secretary of State;

and section (Maternity pay rebate) above shall apply as if the payment made by the Secretary of State to the employee had been made by the employer to the employee in respect of maternity pay, so that, except in a case where a rebate is withheld or reduced under section (Reduction of rebate in certain cases) below, the amount payable to the employer by the Secretary of State by way of rebate under section (Maternity pay rebate) above (as it applies by virtue of this subsection) is equal to the amount recoverable from the employer by the Secretary of State by virtue of paragraphs (a) and (b) above."

The noble Lord said: This new clause sets out the circumstances in which employees can be paid direct from the Maternity Pay Fund. Subsection (1) provides that where an employee claims that her employer has not paid the maternity pay for which he is liable, and that she has taken all reasonable steps to recover payment from her employer, or where her employer is insolvent she may apply to the Secretary of State for payment. Subsection (2) provides that if the Secretary of State is satisfied that the claim is well founded the unpaid amount may be paid to the employee out of the Maternity Pay Fund. Subsection (3) provides that where the Secretary of State makes a direct payment from the Fund to an employee, he shall take over the rights and remedies of that employee in respect of the unpaid maternity pay. Ibeg to move.

Lord DRUMALBYN

I should like to direct the noble Lord's attention to the last three lines of the clause, because I do not understand the words, equal to the amount recoverable from the employer by the Secretary of State by virtue of paragraphs (a) and (b) above". If the employer is insolvent, what amounts are recoverable from him? In the second place, the woman has to take all reasonable steps to recover payment from the employer. If she cannot recover payment from the employer, why does she not go to the industrial tribunal? If in the Bill we provide a means of remedying a wrong, is it right at the same time to allow that means to be sidestepped and a direct approach to be made to the Secretary of State? I do not understand this.

It does not seem to me to be either necessary or desirable to provide this sidestepping, where a person who thinks she is entitled to payment and has taken all steps to recover payment should go to the Secretary of State. Or does it mean that she can go to the Secretary of State after she has been to the tribunal? Is that one of the steps open to her? No, it does not mean that because it says, "other than proceedings". So this is a sidestepping of the procedure. I do not understand why this additional remedy should be provided. It seems to me it is going to mean a certain amount of chaos if it is followed in frequent cases.

Lord JACQUES

This provision is necessary to prevent hardship where there is a claim by an employee and it is not paid by the employer for any number of several reasons. For example, the employer may be insolvent. The employer, although not yet insolvent, may be on the way to insolvency and may be hiving off the kind of claim which the woman has made. In a scheme like this we have to cover all manner of circumstances. Consequently, that is what we are trying to do.

The position is, according to the note I have received, much as I have said. Where there is a need for money immediately because of hardship, then the Secretary of State would pay and take over the woman's rights. But of course, on the other hand, there would be cases where it would be reasonable that the claim should have gone to the tribunal before the Secretary of State intervened; for example, where there is no hardship. In that case the Secretary of State is in a position to decline and to insist that the matter goes to the tribunal before any decision is made. Put in another way, we have tried to make the position as flexible as possible so that we can deal with all manner of cases which are likely to arise.

Lord DRUMALBYN

Is it the intention that a woman should be able to go to the local office and say, "I am not being paid my maternity pay by my employer"—if he is still her employer—"or the person who previously employed me. Will you advance me the money?" Is this what she will say? Will she be able to do that?

I am not certain whether the noble Lord answered my noble friend's question as to whether these payments are expected to be made weekly. After all, maternity pay, filling the gap, is in lieu of pay. Is it expected that the employer will make the payments weekly and, indeed, that the woman will report to the employer to get them in the ordinary way on pay day?

Lord JACQUES

Yes, it is expected that the payment would be made by the employer in exactly the same way as he pays wages. If wages are paid weekly then it would be paid weekly. If for any reason a woman feels that she has a claim against the employer for maternity pay and she has not been paid, she will be free to go to the local office of the Ministry and lodge her complaint which will then be dealt with. Because we have to provide for that we must have the kind of remedies in the ultimate that are put into the Bill.

Lord DRUMALBYN

May I revert to my first observation? I do not understand the wording at the end of the clause. Nothing seems to me to be recoverable from the employer by the Secretary of State by virtue of paragraphs (a) and (b).

Lord JACQUES

This is a technical matter on which I prefer to write to the noble Lord.

Baroness ELLES

I regret to delay the Committee further on this matter, but I wonder whether the noble Lord could give some kind of assurance that a woman who is making a claim will be assisted by some local office of the Department of Health and Social Security or some other Department. How is a woman to be able to prove, for instance, that her employer is insolvent under subsection (1)(b)? It seems to me that redundancy payments methods have been applied to cases which are not practical. A pregnant woman in the last stages of confinement is not likely to be able to find out how to prove that her employer, or ex-employer, was insolvent. These are practical points and they may not have struck the Minister as creating a difficulty. May we have an assurance that every help will be given to a woman who is entitled to maternity pay in order that she will receive it? I see considerable difficulties in the procedures which have been laid down in these Amendments.

Lord JACQUES

There will be two kinds of help. First, it is intended that there will be leaflets dealing with different aspects of the Bill. This will certainly be one of the aspects and it will help to explain some of the rather technical and intricate clauses we have been considering. Secondly, the Department will ensure proper provision for advice to be given in the local offices.

6.8 p.m.

Lord JACQUES moved Amendment No. 25: After Clause 38, insert the following new clause:

Reduction of rebate in certain cases

".—(1) The provisions of this section shall apply where the Secretary of State makes a payment to an employee in respect of unpaid maternity pay in a case falling within section (Payments to employees out of Maternity Pay Fund) (1)(a) above and it appears to the Secretary of State that the employer's default in payment was without reasonable excuse.

(2) In such a case the Secretary of State may withhold any rebate to which the employer would otherwise be entitled under section (Maternity pay rebate) above, as applied by section (Payments to employees out of Maternity Pay Fund) (3) above, or reduce the amount of any such rebate to such extent as the Secretary of State considers appropriate.

(3) Where such a rebate is withheld or reduced and a sum is accordingly recovered by the Secretary of State in exercising a right or pursuing a remedy which is his by virtue of section (Payments to employees out of Maternity Pay Fund) (3) above that sum shall be paid into the Maternity Pay Fund."

The noble Lord said: Amendment No. 25 deals with the reduction of rebate in certain circumstances by the Secretary of State. This new clause, which is on the same lines as the Redundancy Payments Act, empowers the Secretary of State to withhold or reduce a rebate in certain circumstances. Subsection (1) provides that the clause will apply where payment has been made directly from the Fund to an employee because the employer has failed to pay maternity pay without reasonable excuse. Subsection (2) provides that in these circumstances the Secretary of State may withhold or reduce the amount of the rebate. Subsection (3) provides that where a rebate is withheld or reduced and the Secretary of State then recovers any money from the employer, that money is to be paid into the Maternity Fund.

Although it is not part of this Amendment, I should like to say that there is proper provision for appeal by the employer against any decision of the Secretary of State with which he does not agree.

Lord DRUMALBYN

This is a highly technical Amendment, and I should like to ask the noble Lord to explain a little more exactly what is meant by it. Subsection (1) says that the provisions of the section shall apply where the Secretary of State makes a payment to an employee direct. If the employer has not made the payment and the Secretary of State has, obviously the Secretary of State is not going to reimburse the employer. The wording is a little difficult to understand and perhaps the noble Lord would clarify the matter for us if he explained what the rebate is a rebate of. Is it a rebate of the total amounts for that week in respect of maternity pay contributions? You cannot rebate something if you have not had a payment. Perhaps I may ask the noble Lord whether it is intended merely that payments that otherwise would have been made to the employer if he had paid the amount are to be withheld—although it seems to be a very curious way to express this—or whether there is some element of penalty for unreasonably not having made the payment involved? I find this clause very difficult to understand.

Lord JACQUES

May I point out that by an earlier clause if the Secretary of State makes a direct payment he is then put in the position of the employee. He has the same rights that an employee has against the employer. Therefore, the Secretary of State can insist upon the employer paying him, since he has taken the place of the employee. The subsequent question which arises is whether or not there should be a rebate of the amount that has been paid by the employer. Then the Secretary of State can decide to withhold part of that rebate on the ground that the employer has acted unlawfully in not making the payment in a proper way and then claiming a rebate. We all know that a scheme which covers a large number of people, as this will do, will result in some silly asses and that there must be means of dealing with those silly asses. This is one of the means that we shall have of dealing with them. If somebody in an objectionable way refuses to pay and consequently the Secretary of State is put to the trouble and inconvenience of making a payment direct, then he has the power to withhold part of the rebate, if need be. However, as noble Lords will see later, the employer has the right of appeal and the tribunal can direct that the rebate shall be made by the Secretary of State.

Lord DRUMALBYN

That the Secretary of State should pay what the employer ought to have paid, that the employer should then pay in the ordinary way to the Secretary of State what he ought to have paid to the woman and that the Secretary of State should then consider whether or not he will make the rebate seems to be a very curious way of settling the matter. In the case of a scheme of this kind, I am not quite certain that it is satisfactory to use the rebate as a form of penalty. It is only likely to give rise to ill will. The noble Lord says that there will be some silly asses but they will not necessarily be mischievous silly asses; they may have failed to make the payment for some totally different reason. I think that this is not a sensible way of dealing with the matter. If you want to do this kind of thing it is very much better to lay an obligation and ascribe a definite penalty than simply to say, "You can't have a rebate of the money which I have paid on your behalf". This does not seem to be sensible.

Lord JACQUES

This is a long stop and is modelled upon the redundancy scheme. I believe I am right in saying that until now the Secretary of State has not inflicted what the noble Lord has described as a penalty.

Baroness ELLES

With regard to subsection (1) of the new clause, may I ask the noble Lord what is meant by … it appears to the Secretary of State that the employer's default in payment was without reasonable excuse". It is this loose wording that concerns us. The Secretary of State will have the power to withhold rebate from an employer and possibly make the employer pay quite a heavy penalty without, so far as I can see, any judicial process of any kind. It seems to be entirely based on the discretion of the Secretary of State. Therefore, we on this side of the Chamber would like some kind of reassurance that this discretion will be used very sparingly when it comes to withholding the rebate. As my noble friend has said, we should also like to know a little more about the right of appeal of an employer against this, so-to-speak, Ministerial decision which is taken in private without any official process of any kind. That the Secretary of State should have such powers to impose penalties without any publicity, without any judicial administration and without, so far in the Bill, any rights of the employer to appeal or to question either as to fact or as to statements possibly made by the employee, is what concerns us. May we have some kind of assurance from the noble Lord on this matter?

Lord JACQUES

It is exactly the same wording as is used in the Redundancy Fund. It has worked very satisfactorily there, and there is no doubt that it will work very satisfactorily here. On the question of payments from a State fund and whether or not payment should be made from that fund, in the first place it is an administrative and not a judicial matter. That would apply, no matter which Party was in Office. In the first place, payment from a State fund is purely an administrative matter, but there must be judicial precautions. There must be ways of preventing any abuse of power. Consequently, there have to be proper appeal procedures. In a short while we shall come to the Amendment which deals with appeals.

Viscount MONCK

With his usual good humour and clarity, I wonder whether the noble Lord could explain something to me? Subsection (3) of the new clause speaks about the Secretary of State exercising a right or pursuing a remedy. I can understand "exercising a right", but the expression "pursuing a remedy" rather smacks of the medicinal. What does it mean? Is the noble Lord going to end the maternity, or what?

Lord JACQUES

A right would mean a right to claim from an employer the amount that is due. A remedy would mean a right to appeal to the industrial tribunal if the employer failed to pay what was due.

Lord DRUMALBYN

I quite understand that the Government have been following the redundancy payments legislation in this case, but am I not right in thinking that the redundancy payment is made in the form of a lump sum, whereas here we are talking by definition of emergency payments on a weekly basis being made to the beneficiary. This seems to me to be a totally different thing. In this case perhaps the noble Lord has modelled himself a little too closely on the Redundancy Fund and should do some fresh thinking on this clause. Perhaps the noble Lord will look at it again to see whether it requires more closely adapting to the needs of the maternity payment.

If we may go back to the case where difficulties will arise, we are again up against this question of giving information as to pregnancy. As things now stand, when the local office asks, "Why have you not paid this amount? Have you a reasonable excuse?" the answer by the employer will be, "I do not think it is due, because I was not given information about the pregnancy." I think this needs to be looked at much more closely, because it then becomes a contentious matter which ought to go straight to the tribunal.

If the Secretary of State pays out money, I do not see why he should recover it from the employer until the tribunal has decided whether or not there is reasonable cause. Like my noble friend, I do not see any reason why the Secretary of State should first decide as an administrative matter whether or not it was a reasonable case. If there is a dispute of this kind, it should go to the tribunal and not be settled by the Secretary of State, with the right of subsequent appeal to the tribunal. That is the difference.

Lord JACQUES

We prefer to be in a position to deal with hardship, and we can deal with it if we have the kind of provision that we have now. But if we insist that the woman must go through all the processes and go to the industrial tribunal before she gets any payment at all, we shall be creating hardship at a time when it is least desirable to do so.

Lord DRUMALBYN

With all respect to the noble Lord, I never suggested that. I agree that the Secretary of State could make the payments; all I am concerned about is whether he should then recover them from the employer before he knows whether they are recoverable. The employer may have been quite right not to make the payment. We object to the Secretary of State being put in the position of deciding that the employer was wrong not to make the payment and recovering the money from the employer. The amount can be paid by the Secretary of State if the local office thinks fit, but then it should go to the tribunal to decide whether the Secretary of State was right in making the payment, and per contra the employer in withholding it, or whether the employer was right and the Secretary of State was wrong.

Lord JACQUES

We appear to be back on the question of what the noble Lord has been describing as "penalty". As I said earlier, there must be some long-stop against people who—

Lord DRUMALBYN

That is not the point.

Lord JACQUES

Then what is the point?

Lord DRUMALBYN

The long-stop is that the tribunal will decide, if the employer has been wrong in not paying, that the employer should pay and at that point the Secretary of State may, if he likes, withhold rebate in some form or another.

Lord JACQUES

I will just intervene here in order to get this clear. Is the noble Lord now saying that it should go to the tribunal before any payment is made?

Lord DRUMALBYN

No. I said specifically that as I understand it, in a case like this, the person who thinks she is entitled to maternity pay, not having got it from the employer, will go to the local office. The local office can pay it, but the office does so at its own risk. The employer may have been quite right in withholding the payment. This clause says that the Secretary of State can then decide that the employer was not right and recover the payments from him, and then it will be for the employer to take the matter to the tribunal which will ultimately decide. The only residual question is this. If there is to be a penalty imposed, what is it to be imposed against? That is a matter which we must leave to the Government. All we are saying is that it is not right that the Government should decide as an administrative act to fine the employer in this way, especially before they know whether or not it is right to do so.

Lord JACQUES

May I say that the Secretary of State cannot really claim unless it is well founded? The claimant must have taken all reasonable steps, including the industrial tribunal proceedings, before claiming upon the Secretary of State. The Secretary of State wants every other avenue to have been explored before any payment is made, but he wants also to be in a position to step in if there will be hardship.

Baroness ELLES

May I intervene and ask the noble Lord, Lord Jacques, whether he would consider this clause once again, in the light of our worry that an employer might be penalised by not receiving the rebate from the Secretary of State before his own case has been heard. This is what worries us. We should like the Secretary of State to be able to go to a tribunal and say, "We do not think the employer is entitled to his rebate for such-and-such a reason". The money will already have been paid to the woman and she does not enter into it. Her hardship is recognised and she will have been paid through the local office, or by whatever machinery is set up. But we are concerned that the employer will be penalised before he can put his case. It will be only after he has been penalised that he is able to appeal to a tribunal and we feel that this is an administrative abuse. I ask the noble Lord whether he could reconsider this clause, in the light of what has been said and perhaps we could have a word about it on Report, if he would be so good.

Lord JACQUES

I see the point made by the noble Baroness. I think she is saying that if the employer fails to pay the Secretary of State will pay, but let the tribunal decide whether the employer has then to pay the Secretary of State. We will certainly have a look at this to see just what, if anything, can be done.

Baroness ELLES

I thank the noble Lord very much.

6.27 p.m.

Lord JACQUES

This clause contains technical provisions to ensure that in the event of an employer becoming insolvent any unpaid maternity benefit is met from the Maternity Pay Fund and not from the Redundancy Fund. I beg to move.

Amendment moved— After Clause 38, insert the following new clause:

Supplementary provisions in relation to employer's insolvency.

".—(1) Where the Secretary of State makes a payment to an employee under section 55 below (which provides for payments out of the Redundancy Fund in respect of certain debts where an employer is insolvent) and that payment, in whole or in part, represents arrears of pay, then, in ascertaining for the purpose of section (Payments to employees out of Maternity Pay Fund) above the amount of any unpaid maternity pay, section 37(4) above shall apply as if the arrears of pay in question had been duly paid by the employer to the employee in accordance with the contract of employment.

(2) Where the Secretary of State makes a payment to an employee out of the Maternity Pay Fund in respect of unpaid maternity pay in a case to which section (Payments to employees out of Maternity Pay Fund) (1)(b) above applies, then, in ascertaining for the purpose of section 55 below the amount of any arrears of pay owing to the employee from his employer, section 37(4) above shall apply as if the maternity pay in question had been duly paid by the employer to the employee.

(3) Where the Secretary of State makes a payment to an employee out of the Redundancy Fund under section 55 below which, if it had been made by the employer to the employee, woud (apart from section (Reduction of rebate in certain cases) above) have attracted a rebate from the Maternity Pay Fund in accordance with Becton (Maternity pay rebate) above, then, the Secretary of State shall make a payment out of the Maternity Pay Fund into the Redundancy Fund of an amount corresponding to the amount of rebate which would have been so payable."—(Lord Jacques.)

Lord JACQUES moved Amendment No. 27: After Clause 38, insert the following new clause:

Complaint and appeals to industrial tribunal

".—(1) A person who has—

1. (a) made a claim for a rebate under section (Maternity pay rebate) above, in a case to which subsection (1) of that section applies; or
2. (b) applied for a payment under section (Payments to employees out of Maternity Pay Fund) above,

may, subject to subsection (5) below, present a complaint to an industrial tribunal that—

1. (i) the Secretary of State has failed to make any such payment; or
2. (ii) any such payment made by the Secretary of State is less than the amount which should have been paid.

(2) Where an industrial tribunal finds that the Secretary of State ought to make any such payment or further payment, it shall make a declaration to that effect and shall also declare the amount of any such payment which it finds the Secretary of State ought to make.

(3) An employer who has made a claim for a rebate under section (Maternity pay rebate) above, in a case to which subsection (2) of that section applies, may, subject to subsection (5) below, appeal to an industrial tribunal on the ground that—

1. (a) the Secretary of State has refused to pay a rebate; or
2. (b) any rebate paid by the Secretary of State is less than the amount which should have been paid,

and if on any such appeal the tribunal is satisfied that it is just and equitable having regard to all the relevant circumstances that a rebate should be paid or, as the case may be, finds that a further payment by way of rebate should be made, the tribunal shall determine accordingly, and the Secretary of State shall comply with the determination.

(4) Where the Secretary of State withholds or reduces the amount of a rebate in pursuance of section (Reduction of rebate in certain cases) above, the employer may, subject to subsection (5) below, appeal to an industrial tribunal; and if on any such appeal the tribunal is satisfied—

1. (a) in a case where the rebate was withheld, that it should be paid in full, or should be reduced instead of being withheld; or
2. (b) in a case where the rebate was reduced, that it should not be reduced, or should be reduced by a smaller or larger proportion than that which the Secretary of State has applied,

the tribunal shall determine accordingly and the Secretary of State shall comply with the determination.

(5) An industrial tribunal shall not entertain a complaint or appeal under this section unless it is presented to the tribunal within the period of three months beginning with the date on which the relevant decision of the Secretary of State was communicated to the complainant or appellant or within such further period as the tribunal considers reasonable in a case where it is satisfied that it was not reasonably practicable for the complaint or appeal to be presented within the period of three months."

The noble Lord said: This is the clause in which the Opposition will be interested when they are out of Office. I do not know whether they will be so much interested when they are in Office. This deals with complaints to the industrial tribunals against failure by the Secretary of State to make payments. Subsection (1) provides that an employer who has claimed rebate or an employee who has claimed a direct payment from the Maternity Pay Fund may complain to an industrial tribunal if the Secretary of State has failed to pay or has paid less than he should have done.

Subsection (2) provides that, if the tribunal finds that the complaint is justified, it shall make a declaration of the amount that the Secretary of State should pay. Subsection (3) provides for appeals where an employer has paid maternity, pay but was not technically liable to pay it. He may claim rebate and, if refused, may appeal to an industrial tribunal that the Secretary of State has refused payment or has underpaid. If the tribunal is satisfied that the payment of the rebate is just and equitable, it shall determine that payment should be made. Subsection (4) provides that an employer can appeal to a tribunal where a rebate has been reduced or withheld. The tribunal may determine that the rebate should be paid in full, or should be reduced, or instead of being withheld, reduced by a smaller amount. Subsection (5) requires complaints or appeals to be made within three months of the decision of the Secretary of State being communicated, and if this is not reasonably practicable, within such further period as the tribunal considers reasonable. I beg to move.

Baroness ELLES

May I ask the noble Lord, Lord Jacques, in the light of what has been said on Amendment No. 25—I am afraid at some length—whether he would consider the procedure of the new Amendment No. 27 in the light of any decision he may come to over Amendment No. 25? I would ask him to take both of these into account. I do not want to enter now into any long discussion, in view of the time.

Lord JACQUES

It would be consequential.

Lord DRUMALBYN

May I say that I think this is a good clause, and a workable one. All I am saying is that it has been brought more into line with the clauses as a whole.

6.32 p.m.

Lord JACQUES moved Amendment No. 28: After Clause 38 insert the following new clause:

Provisions as to information

".—(1) Where an application is made to the Secretary of State by an employee under section (Payments to employees out of Maternity Pay Fund) above, the Secretary of State may require—

1. (a) the employer to provide him with such information as the Secretary of State may reasonably require for the purpose of determining whether the employee's application is well founded; and
2. (b) any person having the custody or control of any relevant records or other documents to produce for examination on behalf of the Secretary of State any such document in that person's custody or under his control which is of such a description as the Secretary of State may require.

(2) Any such requirement shall be made by a notice in writing given to the person on whom the requirement is imposed and may be varied or revoked by a subsequent notice so given.

(3) If a person refuses or wilfully neglects to furnish any information or produce any document which he has been required to furnish or produce by a notice under this section he shall be liable on summary conviction to a fine not exceeding £100.

(4) If any person in making a claim under section (Maternity pay rebate) above or an application under section (Payments to employees out of Maternity Pay Fund) above or in purporting to comply with a requirement of a notice under this section knowingly or recklessly makes any false statement he shall be liable on summary conviction to a fine not exceeding £400."

The noble Lord said: This new clause provides a means by which the Secretary of State can verify the validity of an employee's claim for maternity pay. It gives him power to call for the sort of information likely to be required from the employer; that is, information as to the length of service of the employee, the date at which she finished work to start maternity absence, and the amount of her earnings. I beg to move.

Lord WIGODER

When the noble Lord, Lord Jacques, has a moment of leisure, would he reconsider the precise wording of subsection (2) of this clause? This is a penal clause, as a result of which a person may be fined if he fails to comply with the notice. Subsection (2) states, very properly: Any such requirement shall be made by notice in writing"— as obviously it should be— given to the person on whom the requirement is imposed …". It then goes on to say that it may be varied or revoked by a subsequent notice so given. Is it not arguable that the words "subsequent notice so given" will merely refer to the giving to the person on whom a requirement is imposed, and would not include the words "in writing"? For the avoidance of any possible doubt in the future, would it not be better that the last words should read, "by a subsequent notice in writing so given"?

Lord JACQUES

We will certainly look at that.

The Earl of MANSFIELD

I would ask the noble Lord, Lord Jacques, to consider whether there should be written into this new clause the criterion of reasonability. Subsection (1)(a) says: the employer to provide him with such information as the Secretary of State may reasonably require …". Thereafter, nothing is said as to whether the information can be easily extracted or provided or whether it is going to be extremely expensive or, indeed, impossible. The only provision thereafter provided for, so to speak, is the requirement of notice, and then a person refuses or wilfully neglects to furnish any information. So we have the situation that before the notice is served the Secretary of State is determining that he requires the information and thereafter the unfortunate employer fetches up in the magistrates' court, and I assume is reduced to a plea of mitigation. Surely, in a Bill which talks the whole way through about conciliation, there ought to be some sort of stage between the serving of the notice and the magistrates' court.

Lord JACQUES

I may be wrong, but as I see this we are concerned with the checking of claims. Therefore, we are concerned with receiving information which will enable us to check the rebates before they are paid to employers. If the Secretary of State refuses to pay because he wants outrageous information from the employer, information which is completely irrelevant or unreasonable, then it will be the tribunal which will decide. The Secretary of State, by refusing to make the rebate, may be taken to the tribunal in accordance with the last clause with which I dealt. The tribunal will decide whether or not the Secretary of State has acted reasonably, and whether he has been right in refusing to pay. There is a right of appeal against this.

I would suggest that the last clause dealing with the rights of appeal against actions by the Secretary of State amply covers the situation, even on the question of information, because inadequate information, or refusal to give information, will lead only to refusal to pay rebate, and therefore give the means to go to the tribunal.

The Earl of MANSFIELD

With great respect, I am not sure that the mind of the noble Lord, Lord Jacques, is running with mine on this point. I can see no provision under Amendment No. 27 for an employer having the right or, indeed, the opportunity to go to a tribunal and argue the toss as to whether the information required by the Secretary of State is reasonable or anything else. Indeed, Clause 28 merely goes on to provide how the notice shall be served on the employer, and what happens if he refuses or wilfully neglects to furnish any information. The situation that I envisage is of a small, incompetent and probably impoverished employer who, in the eyes of the law, wilfully neglected to furnish the information, but who in fact probably is hardly in a position to supply it. I suggest there should be some sort of judicial body, or at any rate some kind of tribunal, put in between the employer and the Secretary of State.

Lord JACQUES

But there is a tribunal as between the employer and the Secretary of State. If the Secretary of State asks for information—let us say, information that he really needs to check the claims for rebate—but the impoverished employer is not in a position to supply that information, then presumably the Secretary of State will refused pay. The impoverished employer then has a right for which the noble Earl, Lord Mansfield, is asking, of going to the tribunal and insisting that payment shall be made. That automatically covers the question of information.

The Earl of MANSFIELD

With respect, I do not think that the noble Lord has taken my point. I think the best thing would be to look at the Official Report and perhaps we can come back to the point again. There is a complete division between where the complaints and appeals process to do with a tribunal stops and the criminal law starts. That is what is worrying me. One may have an employer who is summoned before and convicted in a criminal court, and he is not in a position to argue the toss, to use my own inelegant phrase, because there is no right of appeal not as against withholding the information, but as to what the Secretary of State may require, and whether it is reasonable.

Lord JACQUES

There is provision in these new clauses that if the information called for is unreasonable, the employer can use that as a defence in the proceedings.

The Earl of MANSFIELD

I wish I could see it.

Clause 39 [Right to return to work]:

Lord JACQUES

I spoke to this Amendment with Amendment No. 14. I beg to move.

Amendment moved— Page 32, line 10, leave out ("37, 38 and 40 to 43") and insert ("and 40 to 42").—(Lord Jacques.)

Lord JACQUES

I spoke to Amendment No. 30 on Amendment No. 14. I beg to move.

Amendment moved— Page 32, line 10, leave out from ("of") to ("except") in line 11 and insert (", and Schedule 3 to, this Act").—(Lord Jacques.)

6.41 p.m.

Baroness VICKERS moved Amendment No. 31: Page 32, line 17, after ("redundancy") insert ("or the circumstances of the employer's business having required a permanent replacement to have been appointed on the employee's absence").

The noble Baroness said: I beg to move Amendment No. 31. In the previous debate on 22nd September I moved, at column 154, a similar Amendment to the one I am proposing now. I received a reply from the noble Lord, Lord Jacques, and I said at the time that I was not very satisfied with it. Clause 36 and the following clauses make dismissal on the grounds of pregnancy unfair, provide for maternity pay for a limited period, and give the employee a right to be reinstated in her original job—this was my point on the previous Amendment—after her confinement. It has been suggested to me by more than one person that as the clause is at present drafted the total time off for confinement could be substantially in excess of 44 weeks. This could produce a major disruption; for example, a woman may have a number of children in quick succession. Local authorities are increasingly employing female labour, and so, I am glad to say, are private employers, in posts of responsibility—for example, assistant architects, solicitors and doctors. In such cases, I am told, it would not be practical to hold the employee's job vacant or to fill it by temporary staff. The Amendment I am suggesting would ensure that the employee would have gainful employment available to her on her return to work but would avoid the hardship and subsequent expenditure which would otherwise be incurred; the subsequent expenditure, of course, being in making somebody redundant if they had been there for 44 weeks. I understand that that would entitle them to redundancy pay.

In his reply to me, the noble Lord said that the definition of "job" in the clause already ensures that the clause would give effect to the intention behind my previous Amendment by stating that "job" means the nature of the work which the woman is employed to do. But this was not clear to me at the time and certainly is not clear to employers at the present time. I hope that to make things really clear, both to the employee and to the employer, the noble Lord will consider this Amendment, as it is extremely important that both sides should know exactly how they stand. I beg to move.

Lord JACQUES

May I first deal with the last point raised by the noble Baroness. It is, "the nature of the work"; for example, if the woman was a secretary then she could claim to go back to her job as a secretary, but not as secretary to Mr. X where she was before. It is in the nature of the job that matters.

Baroness VICKERS

That, of course, does not answer my point at all, because a secretary can always get a job as a secretary. That is a very poor example, if the noble Lord does not mind my saying so. The woman who is an architect or a doctor is quite different, particularly an architect. She may be planning a very big building and it is not really possible for another woman to take that over—or probably a man in that case. I feel that this point has real substance. Employers are very worried about this because they consider that having to dismiss the other person is probably going to mean that they have to make redundancy payments, and also it would preclude their getting on with the work. If you take, for example, teachers, the same thing applies. A teacher might be able to take the same place again. On the other hand, it may be necessary, particularly for 44 weeks, to have a teacher in her place; she may be teaching a certain curriculum and it would not be easy to fill her place when the other teacher came back. I am thinking particularly of the professions. If the noble Lord cannot give an answer tonight, I hope he will consider it seriously, because it is causing great anxiety among employers.

Lord JACQUES

It is a mistake to think that there can be reinstatement without some frustration and difficulty to employers. It is unavoidable; you are bound to have it. I am not so sure that it will be more difficult in the professions. In point of fact, the professions already get much more liberal sick leave than would, say, manual workers; they already have contracts which allow them to come back for reinstatement after long periods of sickness, something which very often the manual worker does not enjoy. I am not at all happy with the proposition that it is going to be more serious in the professions than elsewhere.

However, let us consider the Amendment as it is. The effect of the Amendment is to provide that an employee would not be entitled to return to her old job if her employer has had to employ a permanent replacement in her absence, but could be offered an alternative job. But if there is no alternative job she has no remedy, and I am advised that she would not even be able to claim redundancy pay because she is not redundant; she is simply replaced. The purpose of the return to work provisions in the Bill is to make it easier for a woman wishing to continue her job or career after childbirth. To make this possible the Bill has a basic provision giving the employee an absolute right to return to her original job except where the job no longer exists.

If the Amendment were accepted, it would create a substantial loophole in the Bill, because it would be comparatively easy for an employer to claim that it was essential for him to have a permanent replacement and that he had no suitable vacancy. In this situation the woman might be denied any right of reinstatement at all. In every case an employer will have had notice that the employee intends to return to work. Obviously there will be cases where it is difficult, but the Bill has gone a long way to simplify the reinstatement by the employer. He may postpone the employee's return for up to four weeks. He may offer her any alternative employment. This Amendment could in many cases effectively deny the employee her right to reinstatement, and is, therefore, not one the Government could accept.

Baroness SEEAR

While I do not rise to support this Amendment, I recognise that there is this real problem that the woman's right of reinstatement must be safeguarded. At the same time there is the very real problem here which has not been solved either by this Amendment or by the reply we have had from the noble Lord, Lord Jacques. With regard to the point about it being more difficult in the professions, I would say that in certain professions, and indeed in executive positions in industry, there are jobs in regard to which you are just not going to be able to get replacements. Nobody will come on the understanding that they will have to go out after a period of time. In jobs where there are a large number of employees of the same type and a high turnover you can very easily get someone to come on a temporary basis, or, if not on a temporary basis, it is very easy for the employer to move the person who has come as a temporary into what is, in effect, a permanent job. But no assistant architect, or a sales manager, or someone of this level, is going to take the job if he is going to be put out again after six months. So while I do not support this Amendment, because we have to maintain the woman's right to reinstatement, I think we have here a big problem which has not been resolved.

6.49 p.m.

Lord WIGG

I am in a similar position to the noble Baroness. I am not at all convinced that the Amendment put down by the noble Baroness, Lady Vickers, does the job, but neither do I think the Government have faced up to the problem. It is no use arguing the case, as the Minister does, in terms of the woman coming back to a job and saying that in fact, if the Amendment was carried, she would not get anything at all. I want the Minister to be a little more imaginative and to look at industry as a whole, to look at industry in the constituency which I represented in the House of Commons for many years. There are large numbers of very small employers. You have the employer, the man who runs the business; he has a secretary and general staff doing many jobs, secretarial, a bit of bookkeeping, and so on and so forth.

If the Bill goes through unamended, employers are going to be very careful about employing women of child-bearing age. If the lady becomes pregnant and is going to have a child, he, poor man, has to carry on and find somebody else. The number of ladies who can do the kind of job he has in mind is limited. So he gets hold of somebody, and he can get them only if he promises them a permanent job. If he does that, then what is his position to be? The idea that I am putting forward is the one-man business. He will be ruined at the end of the day, because if he then sacks the person who is taken on as permanent and it has gone on long enough, she will have some claims against him. If he then takes the lady back and has met the expense of that, and one child is not sufficient, she then has a second child. I said on Second Reading that these provisions are classic examples of "people's bleeding hearts running away with their bloody heads". Of course, every civilised human being wants to do the best for a woman who is fulfilling her destiny in having a child, but this country has also to carry on its industry. Women in industry, particularly in the responsible, semi-executive secretarial jobs, play a vital role, and are scarce human beings who are difficult to get hold of.

If the Minister rejects out of hand the noble Baroness's Amendment—and I quite agree, and perhaps he would, too, that it is not the last word in human wisdom—will the Minister be good enough kindly to recognise that there is a problem here which has to be tackled. It is no good leaving the words in the Bill unamended, because while he may therefore have discharged his responsibility to the Government he is leaving an enormous problem to grow like an ulcer to get worse and worse; and at the end of the day the victims will be the very women that he is seeking to help, because they will not be able to get a job comparable with the merits which their attributes demand. Therefore, we go full circle.

I am not suggesting that my own views here are the last word. I am out of touch. I have been in space for seven years. However, I know that when I was a Member of Parliament, I was in touch with industry in the West Midlands, the home of small industry, very often family affairs, and by putting this on the Statute Book unamended the Minister intellectually, if I may be paradoxical, would be cutting his own throat.

6.53 p.m.

Lord JACQUES

I would agree with the noble Lord that there is a problem. I think that we all recognise that. It is quite impossible to have reinstatement without some inconvenience to the employer. I disagree with him when he says that the problem will get worse and worse. All experience has shown that this kind of problem gets not worse and worse but easier and easier because of the experience which people have in handling the problem. In many of the professions arrangements are already made for relief. For example, in the medical profession there is a locum, and in the pharmacies there is a locum brought in because there has to be somebody there. Inevitably there is sickness and there has to be some replacement. Even among clerical staff we now have the agencies who supply the clerks, because in many cases it is important that the employer should have replacements for clerks due to sickness, maternity, or anything else. Experience tends to contribute to the solution of these problems, and in time the problem will get better and not worse, and on that point I disagree with the noble Lord.

Lord WIGG

What is the good of the Minister coming along and arguing the case from the point of view of professions like the medical profession, the dentists, the lawyers, and the like? They are in a class apart. It is in their very nature that if a person cannot get a job in one town, town A, he gets it in town B, or in town C, transport being what it is. While there may be hardship, we are not dealing with that point. We are dealing with a girl who has a few "O" levels, has come into industry, is a skilled shorthand typist who understand the industry. She has the job, she is her boss's right-hand man, and becomes an integral part as much as his right hand. She is good looking, like the Minister; she marries—I cannot say like him she has a child, that would be asking too much—but in the fullness of time she has a child. Under the provisions of this Bill she goes away to have a baby, and he has to carry on his business. He has to find a replacement. The only way he can do it is to get somebody full-time. Then back comes the girl and out goes the full-time person. He has then to face up to the financial consequences. The people that he is looking for are not like the medical profession, where you can go to some agency and get a locum. He has to go looking around to find other ladies of comparable experience who understand his specialised business, and they do not exist. They are very rare specimens.

The Minister has blinkers on. He is not seeing the problem in the way that the noble Baroness below the gangway on the Liberal Benches sees it, and as the noble Baroness, Lady Vickers, has expressed her views. I admit that I am completely out of date but at least I have the admission from the Minister that there is a problem. Why does not he go away between now and the stages in the other place and, having recognised that there is a problem, do something about it, and not turn the problem on its head and say, "After all, doctors and solicitors, can solve it, or the dentists can solve it"? He admits there is a problem. It is his responsibility and that of the Government to solve the problem and not leave it.

Lord COOPER of STOCKTON HEATH

I think that there is a problem, but the Amendment will not meet it. First, when a woman is in this condition the employer will have ample notice in which to make the necessary arrangements to replace her for the time being. The Bill itself is trying to ensure the reinstatement of a woman after pregnancy. The substitute will be taken on when the woman goes off, and she will be there for up to twenty-eight weeks after the birth of the child. The question therefore before us is which of the two women are you giving the guarantee to. The first woman who is pregnant might have been employed for eight years by this employer. The employer will know, if this is carried through, that he has to find someone to deputise for the time being for quite a long time. I know that this is difficult, but we are getting very near to saying that the Bill is wrong and you should not try to guarantee reinstatement for pregnancy. This is what we are getting near to. Reinstatement can be in any other position, and if this temporary woman needs accommodating then she should be the woman to have the temporary position or some other employment and make way for the other woman to be reinstated. I agree that it is difficult and that every case is different, but in the spirit of the Bill the Amendment ought to be rejected.

Lord SEGAL

I wonder whether we are not making somewhat heavy weather of this Amendment. I would ask the Minister whether it would not be a situation comparable to a woman having to give up work on account of pregnancy where a woman, who may be a key employee to a particular business, may be entitled to leave of absence to take a holiday for a period of four to six weeks? Six weeks should not necessarily be very much longer or shorter than the time of absence due to pregnancy. In those circumstances the employer would have to accept it as a regular thing to manage somehow to tide over the period of six weeks without having expert assistance from another employee whom he may have to engage temporarily. It is the experience of many small businesses that they are able where a key worker is involved to tide over a period where pregnancy is concerned so that automatically people may be reinstated when they are fit to return to work.

Baroness ELLES

I must say from these Benches that we are not entirely in agreement with the noble Baroness, Lady Vickers, because, as several noble Lords have pointed out, this is not in the spirit of retaining the right of a woman to return to her former employment. Much has been said tonight about this poor pregnant woman and her rights to return, but I wonder whether noble Lords have considered the effect of Clause 29, covering suspension from work on medical grounds. I have not noticed here any grave concern for an employer who is deprived of his employee for six months on medical grounds; nobody has expressed concern about the fact that a man might be in difficulties because his employees are away on medical grounds. I really do not see that there is very much difference between that case and a woman being away, obviously for a different, and absolutely recognisable, reason—the fact that she is having a child; but perhaps the answer is easier in such a case because it is forecast able, whereas it is not forecast able in the case of a man being away on medical grounds. I realise that it may be difficult for employers. I realise also, as has happened in many other countries where they have the right to reinstatement, that the woman may in the end not exercise that option because she may prefer to remain at home and look after her child.

There are human factors in this matter which we have not touched on tonight—and at this hour I do not think noble Lords will want to go into them; but the Committee will be aware that there are many options open to a woman who stays at home with her child, for example doing alternative work or part-time work; she may have all sorts of other ways of earning a living and she may not in the end want to be reinstated. I feel rather with the noble Lord, Lord Segal, that we are perhaps making somewhat heavy weather with this provision and that, at any rate for the time being, we should be prepared to accept the clause as it stands.

Lord JACQUES

I want to repeat a point which I think I made on Second Reading. This is a problem which of course we already have. Many employers pay sick pay to employees and guarantee them their place when they come back, and of course sickness is much more common than maternity and therefore is in some ways a much more formidable problem. I managed a business which had a staff of 5,000 and that firm gave sick pay up to 26 weeks and guaranteed replacement at the end of sickness. We had difficulties, but we overcame them, and the difficulties arising from this clause will be overcome in much the same way.

Lord DRUMALBYN

Is not the point here that the circumstances are so enormously varied that it is difficult to make a single rule without exception? I suggest that the Government look again at this provision with a view to seeing what those callings are where one must have a permanent replacement, and deal with those accordingly. There is not a very great deal of hardship in this case because this is something which a woman going into a profession would take into account. Professions have their advantages and disadvantages, but to make a single rule to cover everything is the trouble in this instance, and that is the problem on which my noble friend Lady Vickers has put her finger. There must be occasions when an employee is engaged to do a job and one cannot afford just to let that person go because that employee is fully acquainted with what is going on in that job. This is where the Government must consider the matter again. One comes up against problems of this kind which appear to be irreconcilable. They probably are irreconcilable in some cases, and the problem is to isolate those problems in those cases.

Baroness VICKERS

We have another stage through which the Bill has to pass and I do not know whether the noble Lord, Lord Jacques, would be prepared to say that he is prepared to consider this matter again with the very able help of the people in his Department. They might be able to find a way out of the difficulty. If he will agree to do that I will withdraw the Amendment.

Lord JACQUES

I must be candid with the Committee. The Government know that there is a problem here but they feel that they have gone as far as they can to meet the employers' point of view: for example, by the delay of four weeks on return, and so on. They do not know of any other way in which they could give relief without undermining the scheme.

Baroness VICKERS

I am obliged to the noble Lord for that reply. I reserve my right to try to think of a way out of this difficulty before the next stage of the Bill. In the meantime, I beg leave to withdraw the Amendment.

Amendment by leave, withdrawn.

Lord JACQUES moved Amendment No. 32: Page 32, line 34, leave out ("and Schedule 3 below") and insert ("below and Schedule 3 to this Act")

The noble Lord said: With the leave of the Committee, I will move at the same time Amendments Nos. 32 to 38 inclusive.

The CHAIRMAN OF COMMITTEES (The Earl of Listowel)

We must abide by the Committee procedure; each clause must be moved into the Bill.

Lord JACQUES

I understand that Amendments Nos. 32 and 33 are drafting Amendments and I spoke to them when moving Amendment No. 14.

Lord JACQUES

Amendment No. 33 is also a drafting Amendment and I spoke to it when moving Amendment No. 14. I beg to move.

Amendment moved— Page 32, line 40, leave out ("and Schedule 3 below") and insert ("below and Schedule 3 to this Act")—(Lord Jacques.)

Clause 39, as amended, agreed to.

Clause 40 [Exercise of right to return.]:

Lord JACQUES

Amendment No. 34 is a drafting Amendment. I beg to move.

Amendment moved— Page 34, line 15, leave out ("and Schedule 3 below") and insert ("below and Schedule 3 to this Act")—(Lord Jacques.)

Clause 40, as amended, agreed to.

Clause 41 [Failure to permit to return treated as dismissal.]:

Lord JACQUES

I spoke to Amendment No. 35 when moving Amendment No. 14. I beg to move.

Amendment moved—

Page 34, leave out lines 23 and 24 and insert— ("(a) the provisions of this Act and the 1974 Act relating to unfair dismissal; and") —(Lord Jacques.)

Lord JACQUES

I likewise spoke to Amendment No. 36 when speaking to Amendment No. 14. I beg to move.

Amendment moved— Page 34, line 31, after ("3") insert ("to this Act")—(Lord Jacques.)

Clause 41, as amended, agreed to.

Clause 43 [Interpretation of ss.35 to 42]:

Lord JACQUES

I spoke to Amendment No. 37 when moving Amendment No. 14. I beg to move.

Amendment moved— Page 35, line 6, leave out ("and this section") and insert (", this section and Schedule 3 to this Act")—(Lord Jacques.)

Lord JACQUES

I likewise spoke to Amendment No. 38 when moving Amendment No. 14. I beg to move.

Amendment moved— Page 35, line 28, after ("40(1)") insert ("above")—(Lord Jacques.)

Clause 43, as amended, agreed to.

Clause 54 [Priority of certain debts on insolvency]:

Lord JACQUES moved Amendment No. 46: Page 45, leave out line 25.

The noble Lord said: This Amendment, together with Amendment No. 48, is for the purpose of deleting references to maternity pay from the insolvency provisions of the Bill. This arises out of the funding of the Maternity Scheme.

Clause 54, as amended, agreed to.

Clause 55 [Employee's rights on insolvency of employer]:

Lord JACQUES

This Amendment, No. 48, is consequential on Amendment No. 46. I beg to move.

Amendment moved— Page 45, line 43, leave out from beginning to first ("the") in line 1 on page 46.—(Lord Jacques.)

Clause 55, as amended, agreed to.

Clause 111 [Application to Crown]:

Lord JACQUES moved Amendment No. 72: Page 96, line 26, after ("21") insert ("(Provisions as to information)").

The noble Lord said: This Amendment and Amendment No. 73 are technical Amendments consequent on the new Maternity Fund clauses.

Lord JACQUES

Amendment No. 73 is consequential on Amendment No. 72. I beg to move.

Amendment moved— Page 97, line 5, after ("sections") insert ("(Provisions as to information) (3) and (4)"). —(Lord Jacques.)

Clause 111, as amended, agreed to.

Clause 113 [Financial provisions]:

Lord JACQUES moved Amendments Nos. 74 to 78 en bloc:

Page 98, line 34, after ("include") insert— ("(a) any sums payable out of the National Loans Funds under section (Advances out of National Loans Fund) above; (b)").

Page 98, line 35, leave out ("the National Loans") and insert ("that")

Page 98, line 38, after ("such") insert ("sums or")

Page 98, at end insert— (2A) There shall be paid out of the Maternity Pay Fund into the Consolidated Fund sums equal to the amount of any expenses incurred by the Secretary of State in exercising his functions under the provisions of this Act relating to maternity pay.

Page 99, line 10, after ("into") insert ("the Maternity Pay Fund")

The noble Lord said: Amendments Nos. 74 to 78 inclusive are technical Amendments consequent upon the introduction of the new Maternity Pay Fund clauses. I beg to move en bloc.

Clause 113, as amended, agreed to.

Clause 117 [Northern Ireland]:

Lord JACQUES

I beg to move Amendments Nos. 84 and 85. These Amendments are consequential on the introduction of the new Maternity Pay Fund clauses.

Amendments moved—

Page 103, line 15, leave out from beginning to second ("the")

Page 103, line 17, after ("authority") insert— (a) where the arrangements relate to the provisions of this Act relating to maternity pay, to make any necessary financial adjustments between the Maternity Pay Fund and any fund established under Northern Irish legislation; and (b) where the arrangements relate to the provisions of sections 55 to 59 above,"—(Lord Jacques.)

Clause 117, as amended, agreed to.

House resumed: Bill reported with the Amendments.