HL Deb 25 September 1975 vol 364 cc463-535

2.59 p.m.


My Lords. I beg to move that the House do now again resolve itself into Committee on this Bill.

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


My Lords, this may be a convenient moment for me to put the record straight. In the Official Report of last Monday, 22nd September, in Committee on this Bill, at columns 104 and 105, two inter ventions made by my noble friend Lord Hawke were ascribed to me. Since my noble friend's views were not in accord with mine, and since I spoke both before and after his interventions, it appears that I changed my mind not only once but twice. I understand that the Official Report is being corrected, but as I in tend to return to the subject on Report I felt obliged to make my position clear at the earliest opportunity.

On Question, Motion agreed to.

House in Committee accordingly.


Clause 90 [Duty of employer to consult trade union representatives on redundancy]:

The Earl of GOWRIE moved Amendment No. 79A: Page 74, line 21, leave out ("an employee") and insert ("employees").

The noble Earl said: We now come into the region of the Bill in which we are going to discuss the procedures for handling redundancies—the situations that can occur when an employer proposes to make employees redundant, and recognises an independent trade union in respect of those employees and the requirements on the employer to consult the trade unions as soon as possible. I will speak to this Amendment by itself but I will, with the agreement of the Committee, take together with it some of my subsequent Amendments, although I would not wish the Committee to think that this is part of a general debate on Clause 90, which I shall come to later.

The procedure for handling redundancies is of course based on the EEC Directive of 17th February 1975 relating to collective redundancies. The provisions of Clauses 90 to 98 of this Bill, however, go further than the Directive in two important respects, and the purpose of my Amendment is to bring the Bill into line with the Directive in one of those respects. It will be noted that the Directive refers to "collective redundancies" and it means by this 10 or more employees being made redundant at one time. It is not concerned with individual redundancies as such; its concern is with the consequences of a number of employees being made redundant in the same place at the same time. It therefore provides for consultation with recognised trade unions and prior notification to the public authority, particularly of course to assist in finding alternative work.

In our view, however, the Government have used this vehicle to provide for compulsory consultation on every single redundancy. Although it is obviously good practice to do so—and we do not contest this—and where trade unions are recognised this is almost always done, one must question whether it is appropriate to apply the full force of the law in the case of individual employees who are made redundant. In other words, where there are sensible rules where groups of employees over 10 in number are concerned, is it right to apply these rules individually? This would include the provision in Clause 90(5) which requires notification to be in writing and to specify all the details listed in subsection (5) (a) to (e) and the legal penalties which can follow a failure to observe the statutory procedure. The effect of this procedure on, to take one industry as an example, the construction industry, where employees of different sorts are taken on and laid off almost daily, would surely be ludicrous. I beg to move.

The LORD PRIVY SEAL (Lord Shepherd)

The noble Earl, Lord Gowrie, is correct to say that this clause is fulfilling the spirit of the regulations of the European Economic Community, but it has always been stressed that the Regulations in this respect are the minimum that the EEC expects of Member countries and there are a number of circumstances where countries have thought it right to go beyond the minimum. The Government have felt it right to try to give to the unions and to officials who may have to deal with redundancies the maximum period in which matters can be dealt with and problems eased, and I should not have thought any noble Lord would object to that. I should make it clear that an employer is required to consult the union at the earliest opportunity in respect of all employees, but there are no formal time limits imposed on the employer by this legislation. The time limits are set out in subsection (3), and in a later Amendment the noble Earl is seeking to reduce the period. We will come to that in time.

If the noble Earl will refer to subsection (8) he will see—because he referred to the construction industry, which, as he said, has special problems in respect of redundancies—that we have provided that if in any case … there are special circumstances which render it not reasonably practicable for the employer to comply with any of the requirements of subsections (3), (5) or (7) above, the employer shall take all such steps towards compliance with that requirement as are reasonably practicable in those circumstances. Naturally, it is for the employer to show to the appeals board that he has taken reasonable steps.

At this time of high unemployment and risk of redundancy, whether of one, 10, 100 or even more, I should have thought it right and proper that we should seek to ensure that what happens is what most good employers now do, which is to consult within the district with the unions and the authorities who are responsible for matters arising from unemployment and redundancy and to give notification of the circumstances in which people are being made redundant, including the numbers likely to be involved and the type and character of the work for which those people were trained, all to help to ease the problems and hardships of redundancy.

This is the sole purpose of this group of clauses, and I should have thought that the spirit behind them would be fully endorsed by the Committee. True, in certain circumstances, certain of the provisions may appear perhaps to he harsh—"cumbersome" might be a better description—but subsection (8) clearly means that if an employer is unable to fulfil the requirements of subsection (2), then if he has acted reasonably he would be absolved from any responsibility under the Statute. I would have hoped the noble Earl would have thought this a reasonable approach. Most good employers today fulfil, on a voluntary basis, the sort of consultation outlined in these clauses. We believe that this should be in the Statute, but we have provided this formula or basis by which an employer, if he cannot fulfil the requirements, and if he can prove he has acted reasonably, will be absolved from responsibility.

3.9 p.m.


I urge my noble friend to ask the Secretary of State to examine this proposal again because there are depths to this matter which may not yet have come to the surface in this discussion. It is commonplace for people, especially individuals, who are made redundant to want to avoid having the matter discussed with a representative, even when the person concerned is a member of a trade union. It is sometimes regarded by an individual employee as an invasion of his privacy, and years of experience on my part and on the part of others has shown that when a person is leaving his employment, either on the grounds of redundancy or through dismissal because he has proved inadequate—and the line between these two is some times very blurred indeed—in many in stances the individual will say, "I don't want this discussed with my trade union representative or shop steward". I can recall dozens of cases where this has happened, where people have required the departure to take place quietly. It seems to me that this clause would make it essential for an employer to discuss each case with a trade union official. This would have to be done in spite of the objection of the person who is being made redundant or dismissed—I am aware that the clause refers to redundancies—and I feel that there might be pressure on some people to ask to be dismissed rather than being made redundant. I wonder whether this could be looked at again.


My noble friend has asked me a question which is clearly valid where a single individual is involved. There may be reasons why he would wish this not to be known either to his union or anybody else. I can imagine such circumstances and I shall certainly see what can be done here. I do not feel that my noble friend is speaking against the general principle which is involved here. Clearly, if there were a group of employees one could not go round consulting them because, at that stage of notification, those who were to be made redundant might not yet have been identified. That may be part of the negotiation or consultation between the union and the employer. I can see difficulty there, but I shall certainly look into the question of what protection could be given to an individual who might wish, for a number of reasons, that it should not be known that he had been made redundant. I can see difficulties, but I naturally respond at Committee stage to a point of this nature, particularly as it does not involve what may be called the spirit or the principle which underlies the Bill.


I believe that, if the tribunal is reasonable, subsection (8) should provide an answer to most cases, but it occurs to me that there may be some conflict of interest in cases of bankruptcy. I wonder whether the noble Lord would look into that at a later stage? I understand that, in bankruptcy, the arrears of pay of employees have a first call on the assets, but I am not quite sure whether the 90 days extra pay would have the same priority. If the employer complies as reasonably as he can with the requirement here, he might be paying over to employees redundancy pay which would in practice be robbing the creditors. I am not sure of the law in this case, but perhaps the noble Lord would look into this.


I believe that the noble Lord is quite accurate. In cases of bankruptcy, employees' pay has one of the first calls on whatever assets can be recovered. I would only say to the noble Lord that, if he will look at Clause 90, he will see that what we had in mind was that an employer, on becoming aware or on deciding that redundancies were likely to arise in his company, should notify and comply with the period specified here. Clearly, if there is a bankruptcy or some special reason why the redundancies have to be brought into effect before that time expires, this would be a matter for the tribunal to take into account. But the spirit of Clause 90(2) is that employers in such cases should notify the respective union within 60 days or, in another case, within 90 days. It is to notify and then to consult. There is no other matter behind it.


Akin to that point, may I ask whether the word "employer" would cover a receiver? Would the receiver be considered to be in the position of an employer? A similar point arises here to that made by my noble friend Lord Hawke.


Though I have not yet been bankrupt or involved in a company which has gone bankrupt and not being a lawyer, I suspect that a receiver can be brought in when a company may have only relatively few days to survive but that there are other occasions when he may be running a business for many months. I should have thought in that case that the receiver would become, de facto, the employer and that if redundancy were necessary he would carry out the obligations set out in subsection (2). Clearly, if a receiver were in and were exercising his judgment on behalf of the creditors of the company—who may be the employees of the whole company—if he had to take certain action and could not give the notice, I should have thought that this would fall for consideration under subsection (8).


The receiver may have to take some fairly speedy decisions if he is to save the company. The issue may be whether the company is to be saved or whether the clause is to be observed.


That is what I had in mind in concluding my last remarks to the noble Lord. I think that it would fall within subsection (8).

The Earl of GOWRIE

It is a melancholy thought that the situations in bankruptcy which could lead to the kind of difficulties referred to by my noble friends Lord Hawke and Lord Drumalbyn may be with us at this moment and in the foreseeable future. Clearly, therefore, it is very important that we should get this right. I hasten to say to the noble Lord, Lord Shepherd, that I am not, with the present Amendment, speaking against the general principle here. The spirit of the clause, which is the spirit of the EEC Directive, is one with which I agree. Nor do I feel that the noble Lord, Lord Shepherd, is being unreasonable, though I think he may be being a little cumbersome in his use of words. I should have thought that my Amendment would cover subsection (8) more or less in one letter, let alone syllable, whereas the noble Lord insists on taking five sentences to do so. However, he has given an assurance to the noble Lord, Lord Brown, on another point which is of interest to us and that is good enough for me. I therefore beg leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

3.19 p.m.

The Earl of GOWRIE moved Amendment No. 79B: Page 74, line 30, leave out from ("begin") to the end of line 31.

The noble Earl said: With the leave of the Committee, I should like to take Amendments Nos. 79C, 80A, 85A and 85B with this Amendment. These Amendments deal with the second aspect in which the Bill lays down tighter obligations than the EEC Directive. As originally drafted, the Directive provided that when 10 employees were made redundant consultation with the unions and notification of the public authority should take place one month before the dismissals took place. Discretion was to be given to the public authority to delay the date of dismissal for a further month for various reasons. When the Council of Ministers came to consider the final draft of the Directive, they decided to fix the period firmly at one month and deleted all provision for extension. This was clearly the most sensible decision.

For smaller firms, a minimum two months' notice when 10 people have to be made redundant could be very difficult indeed. Of course, those employees entitled to longer notice based on length of service would, in any case—and under the Amendment—still be entitled to it. In times of recession—and these, alas! are the times in which we live—smaller firms live very much from con tract to contract. Contrary to what many people think, very few firms willingly break up a satisfactory labour force. Employers do not lightly rush into making people redundant. Rather, they hang on to them until the last moment, often until long after they have real economic need for them. The cost of two months' notice on top of this may prove damaging to the undertaking and of course it will be psychologically damaging to the job security of the remaining workers.

On the other hand, if notice has to be given early, it could also prove damaging through loss of morale and the voluntary departure of essential employees who see the chance of more secure employment elsewhere might follow. Again, I am talking mainly in the context of small firms. In our view, a minimum period of one month for consulting the unions and notifying the employees is clearly adequate, particularly since any long-serving employees who are entitled to longer notice under their contracts will still retain their rights. The Amendment would not affect the period of three months' notice required when large numbers of 100 or more workers are to be made redundant. I beg to move.


In many ways this is a continuation of the argument we had on the previous Amendment, but I hope that I may be forgiven if I speak for a little longer than last time, because I do not appear to have satisfied the noble Earl on this matter. He is quite right. These Amendments would cut by half the consultation and notification periods for redundancy of between 10 and 99employees, and give unions and the Secretary of State alike only 30 days' advance warning of redundancy. It has been argued that 30 days should be adequate, in the case of all but the largest redundancies, for consultation with the unions to take place and for the employment services to make any necessary arrangements for the redeployment and retraining of the workers concerned.

It has also been argued by the noble Earl that a number of employers—particularly small ones, and the construction industry—would find it extremely difficult to forecast all but the largest redundancies more than 30 days in advance. While it is true that 30 days' notice might be inadequate in some cases, it is perfectly possible to envisage situations in which a longer period of time could be necessary. Where consultation is concerned there has to be time for the union to be able to digest the information provided, to make any necessary inquiries, and to formulate its own representations to the employers.

Likewise, where there are a number of redundancies, or where the problems of redeployment are considerable, the employment services might well need more than 30 days to make arrangements, where necessary, for redeployment and possibly retraining. But the Government have always recognised that there are bound to be cases when it is not practicable for the employer to notify the Department of Employment, or to start consultation with the unions on proposed redundancies, within the periods required by the Bill. Provisions to meet such circumstances are made in Clause 90(8), to which I referred on the previous Amendment, and also in Clause 91(6) which provide that if there are special circumstances which render it not reason ably practicable for the employer to comply with any of the consultation or notification requirements, the employer must take all reasonable steps to comply with the requirement.

Apart from the defence of special circumstances, the Bill allows an element of flexibility through the exclusion of short-term employment in Clause 107(7), and through the Secretary of State's powers to modify the provision, either generally or selectively, in Clause 97(4). There is also provision in Clause 98 allowing exemption or modification where there is a jointly agreed industry scheme providing no less favourable treatment for employees than that required by the Bill. The measures of flexibility outlined are intended to meet special circumstances, irrespective of the industry concerned.

The likelihood of an employer finding himself in special circumstances may clearly be greater in one industry—the construction industry is very much in our minds. It follows that employers in such an industry may need to have recourse to the special measures available somewhat more frequently than other employers. In many instances, where it would be practicable for employers to give the required periods of notice, there is no reason why they should not do so. A number of employers already give as much, if not longer notice than is already required in the Bill.

I hope that the noble Earl will recognise that although these periods of notification, both to the trade union and to the Secretary of State or his representatives, are longer than required under the EEC Regulations, they are what good employers seek to achieve when they have the opportunity to give such notice. But we have provided some flexibility and have provided a loophole by means of which a good employer, having taken all reasonable practicable steps to make notification, but is not able to comply with these dates, would not be held liable.

I hope that the noble Earl will feel that in legislating like this we should not be legislating only for the present but also for the future. We are here setting a generous time. I must admit, in terms of the unions for consultation, though perhaps at this moment not all that generous a time for the employment services in order to mitigate the problems of redundancy, the finding of new employment, and retraining. But we think that the time indicated in subsection (3) is about right. But having said that, we have made provision that, where an employer s unable to comply, he has available to him certain subsections within the Bill which would absolve him from that responsibility, provided that he had acted reasonably.

The Earl of GOWRIE

The noble Lord, Lord Shepherd, in his argument made much play with the point that the Bill allowed reasonable flexibility. I think that his phrase was, if I have copied it down correctly, … measures of flexibility intended to meet special circumstances regardless of the industry concerned. I do not really disagree with him, but I regard it as an astonishingly clumsy way to do it. The Bill is inflexible in the subsections pertaining to my Amendment and then, as it were, recognising its inflexibility, it proceeds to put in a blanket flexible subsection—subsection (8)—in order to cover eventualities, particularly the type of eventualities in the construction industry, which I mentioned in the earlier debate.

I accept that, and I accept that subsection (8) may have to do. But before withdrawing the Amendment, I cannot resist the conclusion that this is simply another instance of the amount of double think in the Bill. First, the Bill starts out with provisions which appear to be union directives, and then there is a covering clause which appears to be the wiser, second thoughts of the Government. I think that the Bill could have been amended in the way that I have suggested more sensibly in the first instance. But since the noble Lord has made the case very well for subsection (8), I beg leave to withdraw the Amendment.

Amendment, by leave, withdrawn.

Clause 90 agreed to.

Clauses 91 and 92 agreed to.

Clause 93 [Entitlement under protective award]:

3.40 p.m.

Lord SHEPHERD moved Amendment No. 86:

Page 78, line 30, at end insert— ("(3A) In respect of a period during which he is employed by the employer an employee shall not be entitled to remuneration under a protective award unless he would be entitled to be paid by the employer in respect of that period, either by virtue of his contract of employment or by virtue of Schedule 2 to the Contracts of Employment Act 1972 (rights of employee in period of notice), if that period fell within the period of notice required to he given by section 1(1) of that Act.")

The noble Lord said: Clauses 92 and 93 of the Bill entitle employees, of a description to which a protective award relates, to remuneration if they have been dismissed or are to be dismissed as redundant. The intention behind the clauses is to safeguard the position of the employee by ensuring that during the protected period he is no worse off than he would have been if his employer had duly observed the requirements of the Bill. Clause 93 disentitles employees from receiving remuneration under the protective award, however, if they have been fairly dismissed for reasons other than redundancy, if they have left their jobs or refused to take suitable alternative employment without good reason or, having taken such employment, have left without good reason. The provisions are, however, silent on the subject of the employee who is still in employment during any part of the protected period. There is a danger here that an employee could go on strike or otherwise be absent in circumstances in which he would not be entitled to be paid under his contract of employment, and yet still be entitled to remuneration under the protective award. It is to rectify this anomaly that this Amendment has been introduced.

The Committee will have noticed that as well as referring to payment due under the employee's contract of employment, the Amendment refers to payment due under Schedule 2 to the Contracts of Employment Act 1972 which relates to the rights of the employee in the period of notice to which he is entitled under Section 1(1) of the Act. This equation of the protected period with the statutory period of notice is very just as the employee who has been notified that he is one of those to be dismissed as redundant during the protected period is still under notice even where the period of warning that he has been given is longer than either his statutory or his contractual notice. The Amendment will ensure that where an employee is still in employment during the protected period he will be entitled to remuneration under the protective award only in those circumstances in which he would have a right to be paid by his employer, either under his con tract of employment or under the provisions of Schedule 2 to the 1972 Act—whether or not the protected period falls within the period of notice to which he is entitled under that Act. This means that where he is available for work but no work is provided for him by his employer, where he is absent because of sickness or injury, or where he is on holiday in accordance with the terms of his contract he will be entitled to payment. I beg to move.

On Question, Amendment agreed to.

On Question, Whether Clause 93, as amended, shall stand part of the Bill?


May I draw attention to line 37 on page 79, and ask whether (b) has been omitted?


If the noble Lord has spotted a printing error, I will certainly see that it is put right for Report.

Clause 93, as amended, agreed to.

Clauses 94 to 99 agreed to.

Clause 100 [Power to confer jurisdiction on industrial tribunals in respect of damages, etc., for breach of contract of employment]:


Amendments Nos. 88, 89 and 91 are drafting Amendments which do not alter the sense of the words in the clause. I beg to move Amendment No. 88.

Amendment moved— Page 85, line 3, after ("order") insert ("being in either case a claim satisfying the relevant condition or conditions mentioned in subsection (3) below").

On Question, Amendment agreed to.


I beg to move Amendment No. 89.

Amendment moved— Page 85, leave out lines 20 to 23 and insert ("An order under this section may make provision with respect to any such claim only if it").

On Question, Amendment agreed to.

3.37 p.m.

Lord MELCHETT moved Amendment No. 90: Page 85, line 26, leave out ("claimant's") and insert ("employee's").

The noble Lord said: If I may, I should like to take with Amendment No. 90 Amendments Nos. 92, 93, 94, 95 and No. 129. The new clause and the related new Schedule which Amendments Nos. 95 and 129 respectively introduce make pro vision for cases where the employee or employer dies before a complaint under the Bill or under the 1974 Act has been made or while such a complaint is being dealt with. First, the provisions enable the personal representative of a deceased employee to initiate or pursue a complaint on the latter's behalf; and second, they enable an employee to pursue a complaint against the personal representative of a deceased employer.

Special provisions for dealing with cases where the employee or the employer dies already exist in relation to the Redundancy Payments Act 1965. The present provisions are drafted on similar lines to Section 23 and Schedule 4 of that Act. The need to insert such a provision in the Bill was suggested by cases heard under the unfair dismissal provisions of the 1974 Act. Under that Act there have been a few cases in which the representative of a deceased employee has sought to present or to pursue a complaint of unfair dismissal on behalf of the deceased employee. In general, tribunals have construed the existing provisions as enabling a personal representative to proceed with a complaint presented before the death of the employee. However, it appears unlikely that the 1974 Act can be construed to enable a representative to initiate such a complaint, as opposed to pursuing a complaint presented by the employee before his death. Furthermore, an employee has no right to pursue a complaint against the representative of a deceased employer, although he may succeed in such a complaint if the representative enters an appearance.

There is thus a need to make special provision, which this Amendment does. There seems no good reason why under the unfair dismissal provisions, any more than under the Redundancy Payments Act, the accident of timing of the death of the employee or employer should deny to the complainant or to the complainant's dependants, the benefit of any compensation due in respect of events occurring before the death. Where an employee has died before completing a complaint under the unfair dismissal provisions the amount of compensation in question may be substantial in relation to the total estate, for example, where it includes a sizeable element in respect of wages lost since the dismissal.

This general case has equal validity in relation to certain new rights to be conferred by the Bill. Under some provisions of the Bill the amounts of compensation awarded may be considerable; for example under the new provisions on insolvency, and for a CAC award following an employer's failure to disclose in formation for collective bargaining purposes.

However, we think it would be wrong to confine the scope of a new provision to those rights which may involve the payment of substantial amounts of compensation. In general, personal representatives are, in our view, unlikely to pursue complaints for the sake of very small sums of the kind which may be awarded, for example, where an employer has refused to allow the employee time off to perform public duties. But by the same token, it would be hard to justify excluding the possibility of recovering compensation in such a case, particularly where it represented a significant sum in relation to the complainant's or, as the case may be, the dependant's, total income or resources. Moreover, such a complaint might be linked with an unfair dismissal claim which would make it particularly difficult to justify different treatment of the other provisions. The new Schedule accordingly provides that a complaint may be initiated or pursued by the representative of a deceased employee or, as the case may be, against the representative of a deceased employer under any of the provisions of the Bill as well as under the unfair dismissals provision of the 1974 Act. We would expect the number of cases brought as a result of the new provision to be small. The provision that a complaint may be brought against the personal representative of a deceased employer is relevant only where the employer is not a corporate body. It is thus unlikely to produce a great number of cases.

Turning now to Amendments Nos. 90, 92, 93 and 94, the new clause and the related Schedule ensure that any claims which can be made under the Bill by an employee can he made by a personal representative. These four Amendments are consequential on the new provisions. The wording of Clause 100 would be inappropriate in view of the language of the new Schedule in a case where the employee had died, because it refers specifically to the complainant. Changing "complainant" to "employee" ensures that there is no possibility of the pro visions on "Death of employee" not applying, should it be necessary, in a case under Clause 100. As amended, the clause would therefore allow a personal representative or such person as the tribunal may appoint to act on the deceased person's behalf when the provisions of Clause 100 conferring a limited breach of contract jurisdiction on industrial tribunals is brought into force by an order under Clause 100(1). I beg to move.

The Earl of GOWRIE

What the noble Lord, Lord Melchett, said sounds all right to me; but, as I think the Committee will agree, it also sounds fairly complicated and fairly dense stuff. I should therefore like to greet it with modified rapture, look at it carefully and return to it if need he; but it seems to me at the moment that there will be no need to do so.

On Question, Amendment agreed to.


I have already spoken to this Amendment. I beg to move Amendment No. 91.

Amendment moved— Page 85, line 31, leave out ("an order under this section") and insert ("the order").—(Lord Jacques.)

On Question, Amendment agreed to.


I wonder whether it would be convenient to take Amendments Nos. 92 to 94 en bloc. I spoke to them all when speaking to Amendment No. 90. I beg to move.

Amendments moved—

Page 85, line 35, leave out ("to the claimant")

Page 85, line 36, leave out ("the claimant")

Page 85, line 37, leave out ("to the claimant").—(Lord Melchett.)

On Question, Amendments agreed to.

Clause 100, as amended, agreed to.


I beg to move Amendment No. 95 formally.

Amendment. Moved— After Clause 100 insert the following new clause:

Death of employee or employer

". The provisions of Schedule (Death of employee or employer) shall have effect in relation to the death of an employee or employer."—(Lord Melchett.)

On Question, Amendment agreed to.

Clause 101 agreed to.


I spoke to this new clause in some detail when I was advising the Committee to leave out Clause 34 which this new clause replaces. I beg to move.

Amendment moved— After Clause 101 insert the following new clause:

Entitlement to unemployment benefit and recoupment of that benefit and supplementary benefit.

".—(1) Section 139(1) of the Social Security Act 1975 (submission of regulations in draft to the National Insurance Advisory Committee) shall not apply to regulations made under that Act and contained in a statutory instrument which states that the regulations provide only that a day in respect of which there is payable a particular description of any payment to which this section applies shall not be treated as a day of unemployment for the purposes of entitlement to unemployment benefit.

(2) The Secretary of State may by regulations make provision for all or any of the purposes mentioned in this subsection with respect to payments to which this section applies and which are subject of a reference or complaint to, or claim before, an industrial tribunal, that is to say—

  1. (a) enabling the Secretary of State to recover from an employer, by way of total or partial recoupment of unemployment benefit or supplementary benefit, a sum not exceeding the amount of the prescribed element of the monetary award;
  2. (b) requiring or authorising the tribunal to order the payment of such a sum, by way of total or partial recoupment of either benefit, to the Secretary of State instead of to the employee;
  3. (c)requiring the tribunal to order the payment to the employee of only the excess of the prescribed element of the monetary award over the amount of any unemployment benefit or supplementary benefit shown to the tribunal to have been paid to the employee, and enabling the Secretary of State to recover from the employer, by way of total or partial recoupment of the benefit, a sum not exceeding that amount.

(3) Without prejudice to subsection (2) above, regulations under that subsection may—

  1. (a) be so framed as to apply to all payments to which this section applies or one or more classes of those payments and so as to apply both to unemployment benefit and supplementary benefit or only to one of those benefits;
  2. (b) confer powers and impose duties on industrial tribunals, on the Supplementary Benefits Commission and on insurance officers and other persons;
  3. (c) confer on an employee who is aggrieved by any decision of the Commission or any tribunal or person as to the total or partial recoupment of supplementary benefit in pursuance of the regulations (including any 480 decision as to the amount of benefit) a right to appeal against the decision to an Appeal Tribunal constituted under the Supplementary Benefit Act 1966 and for that purpose apply Section 18(2) and (3) of that Act (appeals) with or without modifications;
  4. (d) provide for the proof in proceedings before industrial tribunals (whether by certificate or in any other manner) of any amount of unemployment benefit or supplementary benefit paid to an employee; and
  5. (e) make different provision for different cases.

(4) It is hereby declared for the avoidance of doubt that the power to make regulations under Section 114 of the Social Security Act 1975 for the determination of questions arising in connection with that Act includes power to make regulations for the determination of any question arising as to the total or partial recoupment of unemployment benefit in pursuance of regulations under subsection (2) above (including any decision as to the amount of benefit).

(5) Where in pursuance of any regulations under that subsection a sum has been recovered by or paid to the Secretary of State by way of total or partial recoupment of unemployment benefit or supplementary benefit—

  1. (a) Section 119(1) and (2) of the Social Security Act1975 (repayment of benefit revised on review) shall not apply to the unemployment benefit recouped; and
  2. (b) the following provisions of the Supplementary Benefit Act 1966, that is to say. Section 23 (recovery of cost of supplementary benefit from persons liable for maintenance) and Section 26 (recovery of benefit and other sums in cases of misrepresentation and non-disclosure), shall not apply to the supplementary benefit required.

(6) Any amount found to have been duly recovered by or paid to the Secretary of State in pursuance of regulations under subsection (2) above by way of total or partial recoupment of unemployment benefit shall be paid into the National Insurance Fund.

(7) This section applies—

  1. (a) to a payment of wages or compensation for loss of wages;
  2. (b) to any payment under this Act by an employer to an employee or a payment by an employer to an employee of a nature similar to, or for a purpose corresponding to the purpose of, any payment under this Act.

(8) In this section— monetary award", in relation to an industrial tribunal, means the amount which is awarded, or ordered to be paid, to the employee by the tribunal or would be so awarded or ordered apart from any provision of regulations under this section; the prescribed element", in relation to any monetary award, means so much of that award as is attributable to such matters as may be prescribed by regulations under subsection (2) above; supplementary benefit" means benefit under the Supplementary Benefit Act 1966; and unemployment benefit" means unemployment benefit under the Social Security Act 1975."—(Lord Melchett.)

On Question, Amendment agreed to. Clauses 102 and 103 agreed to.

Clause 104 [Amendments of the Health and Safety at Work, etc. Act 1974]:

3.45 p.m.

The Earl of GOWRIE moved Amendment No. 97A: Page 87, line 13, leave out from ("which") to ("remove") in line 15.

The noble Earl said: We now come to the section of the Bill which, if I may put it this way, is presided over by the spirit of the noble Lord, Lord Robens. We are debating safety and health at work. Specifically, in my Amendment we are to debate the Government intention in this Bill to restrict the appointment of safety representatives to those appointed by recognised trade unions—and I want to say at the beginning that I can think of nothing in this Bill, much of which is contentious, with much of which we disagree, which has caused more furious disagreement, resentment or anger on this side.

We are strongly opposed to paragraph 2 of Schedule 14 under this clause, which seeks to repeal Section 2(5) of the Health and Safety at Work Act; that is to say, it seeks to repeal that Act as it was amended by your Lordships last summer. This section empowers the Secretary of State to make regulations providing for the election of safety representatives by the employees as a whole. This House, under an Amendment moved by the noble Baroness, Lady Seear, provided that it should recognise employees as a whole as opposed to the appointment of safety representatives from recognised trade unions only. This departure from the Robens' recommendations appears to be based on the idea that safety can be a matter for sectional interests alone. We accept that an effective role, perhaps the paramount effective role for the trade unions, is desirable where they are the sole means of representing employees. But employees in a non-unionised or a partially unionised situation should have equal rights of representation under the Act. This Act is designed by the Government to cover all forms of employment.

The practical implementation of the Government's change will give trade union representatives the statutory right to upset existing arrangements which encompass any non-union employee at the work place. I said on Second Reading, and I would remind the Committee, that there are 11 million non-unionised employees in this country. The TUC have already stated in public that in their view the prerequisite for safety participation is union membership, and some unions are already acting on this basis in advance of the change in the law.

Safety has always attracted a number of dedicated men in industry. Are these people to be dumped and their enthusiasm and knowledge lost to industry if they do not happen to be union members, or if they are weakly or partially unionised? The Robens Report, in advocating universal joint consultation procedure said: A general obligation of this nature would, we believe, have very considerable persuasive force in those areas of industry and commerce where joint arrangements are not already well developed. At the same time it would not inhibit the development of various forms of joint endeavour going beyond what is usually comprised in the expression 'joint consultation'. It should be noted also that union organisation is often lowest in those sectors which employ a higher percentage of female labour. Women, in my contention, are therefore more likely to suffer from the removal of this legal right to representation.

It has been argued that only trade unions can properly train safety representatives. We would all wish for proper training; but this cannot be considered an adequate justification for exclusive rights. We doubt whether the trade unions could possibly provide so totally comprehensive a training service. In practice, companies themselves will probably, and do probably, bear most of the burden. Safety legislation is surely too important to allow it to be used to assist trade unions to forward sectional ambitions—too important for legitimate politics, if you like. This is one provision favouring the trade unionist as against the non-trade unionist which must not be allowed to pass.

I recognise that we are in one part of a much wider debate on worker participation, on industrial democracy and the like. All thinking people will agree in principle that employees should be more involved in decision-making in undertakings, though there are of course differing views as to how far this can reasonably go. The accent must be on the employees of the undertaking—all employees and not just trade unionists. Where trade unions are recognised throughout the undertaking, the two could be synonymous; but it is surely un democratic and unacceptable that where there is a mixed situation—and there are many such—these rights should be given only to trade union members.

If Section 2(5) of the Health and Safety at Work Act is repealed, and unions insist on a safety committee in a factory, will their safety committee look after the interests of the non-union members? What happens if the works is unionised but the office staff is only partially unionised? What if the office staff is represented by what the works union does not regard as a real trade union—that is to say, what is commonly called a staff association? In my contention health and safety is too important an arena to bring these difficult questions of union representation into play in this manner. In asking the Government to think again and not repeal Section 2(5) of the Health and Safety at Work Act, we are not taking anything at all away from trade unions, except possibly the arguments that they could use in a recruiting campaign—that is to say, join a trade union and you can get on a safety representative committee. Under this clause the Government take away protection only from non-union members. This is what we contest, and this is what we find wrong. I beg to move.

3.52 p.m.


I apologise in advance for the fact that I propose to make a rather long comment on this Amendment. I support it. My reasons for support are not entirely associated with the Amendment to the Health and Safety Act. Without wishing to lessen the importance of health and safety, if the deprivation of the rights of non-union people to serve on that committee was the only thing which might be at stake, I do not think I should be as deeply concerned as I am. What I am concerned about is that this may well be taken as a precedent for a Bill which I think we can probably expect. I have no inside knowledge of this, but the Secretary of State for Trade has recently set up a Committee to study the subject of participation, and I assume that we are going to have another Companies Act which in some new way will take care of that subject in the future.

If the principle is to be that those who are not members of a recognised trade union should not be allowed to take part in general participation in the future, then this would be very sad indeed. In old style joint consultation, as was first brought into existence during the last war, we all know that there were two sides. There were a number of representatives, usually of trade unions, balanced by an equal number of what was called the management. A modern look at participation demands that the councils which give effect to the whole principle of participation should be many sided; they should reflect the views of every strata of the employment hierarchy in which they all work. It is very important that this be so. Participation is really broadening the base of government of individual companies, and it is not adequate that managers should sit on such a body as managers, because in the presence of the chief executive, who no doubt will sit there, they must agree with him as managers. It is essential that office staff, junior managers, middle managers, senior managers, technicians. technologists, et cetera. are represented properly by those who can speak on their behalf, and, as in the case of shop stewards, are elected to such participating bodies from properly formed constituencies. I am talking about the practice which is not widespread in British industry, but where it has taken place it has proved to be the very "guts" of participation.

It is true that union membership has not penetrated as yet into many areas, particularly what one might call the higher areas of the employment hierarchy. The growth of trade unionism is proceeding very rapidly in those areas. Nevertheless, if the Government arc going to say to people in companies which have chosen so far not to join unions, "You will not therefore be represented on these bodies", that is a very serious matter indeed. The views of people representing foremen, technologists, managers and senior managers, are a very important ingredient indeed in the discussion of the policies which must be made by those works councils. The object of those councils is to be the internal law-making body of a company, to deal with all the details surrounding conditions of employment and many other things. To exclude such people from those discussions as representatives so that they can speak with complete freedom—which they would not be able to do if they appeared as part of the management team—is an extremely important omission of vital principle. It is on the grounds of the precedent set by the Bill as it stands that I ask the Government to think again about this matter.

Of course I have sympathy with union members, union officials and union general secretaries who make the argument that for years men have risked their livelihood to argue the case for reasonable conditions and proper pay. In the past it has meant that people who joined unions risked their livelihood in that way and were heroes of the day. The argument has been that those who do not join unions have had the benefit of those arguments all along, and they should not be allowed to take part in the negotiations and discussions with management, unless they see fit to join a union. But today the argument is no longer valid. It does not require an individual who wants to argue for the rights of his fellow employees to risk his livelihood. This is particularly so in the light of many of the provisions of the Bill in front of us. I suggest that this simple Amendment should be accepted by the Government largely on the ground that if the Bill stands as it is, then an unfortunate precedent may be created for a further Bill dealing with the much wider question of participation in general.

3.59 p.m.


It will come as no surprise to the Comimttee, in view of the action taken by my noble friend Lady Seear during the discussion of the Health and Safety at Work Act last summer, that we on these Benches wholeheartedly sup- port the Amendment so ably moved by by the noble Earl, Lord Cowrie. I shall not add many words to this. I want to reiterate one or two of the points which have been made. When thinking about this Amendment the most important point is to remember what was mentioned by the noble Earl, Lord Gowrie: at the moment fewer than 50 per cent. of the workpeople in this country belong to trade unions. I was very grateful to him for pointing out that it is in the part of industry where women are largely employed that the union organisation is at its worst. But it is also true of many small industrial companies and places of work where unionism is not as strongly present as we would all wish.

I agree wholeheartedly with the noble Lord, Lord Brown, when he expressed his fears about this type of legislation in which the Government are at present engaged, when we look forward to legislation for joint consultation and democracy in industry. I cannot help feeling that the repeal of this section of the Health and Safety at Work Act could be the thin end of the wedge and show us the lines on which the Government are proposing to proceed when they present us with the next document. At the same time, I said—I believe it was the day before yesterday—that I cannot understand the lack of faith in the trade union movement that seems to be inherent in the Government's action.

If the trade union is seen to be representing the true interests of the work-people in any workplace, and if its leaders are active, they will without doubt be the people who will be elected to the health and safety committees. It is up to the unions to prove that they are working for the good of all the people in a particular industry. If they do that they have nothing to fear but, as I say, there are many cases where trade union representation is a minority within a works and it is only right that the employee individually should be able to elect his own representative. I feel that, to a certain extent, on this occasion the Government are using the safety and welfare of people at work for political manoeuvring, when I believe it should be a matter of the most common concern to us all, and should certainly be a matter of concern to every employee within every undertaking.


The argument which the noble Baroness has just put forward is a typically Liberal argument. It is divorced from any contact whatever with reality. I am not surprised: it is common form. Turning to the noble Lord, Lord Brown, over the last few days or so I have come to have regard for his great interest and knowledge of this subject, but I must say that his speech today has not convinced me that logic is his strong suit. To take an Amendment, which was clearly expounded by the noble Earl, Lord Gowrie, put forward arguments which required to be met and ask the Government to take account of their substance, and then turn the argument on to its head and say that the simple practical approach contained in this clause and Schedule 14 is "the thin end of the wedge"—to quote the noble Baroness—to influence the principle upon which worker-participation in industry is to be worked out (I am looking for a polite word to use), does not convince me.

The simple facts are that whether or not there is effective union representation does not affect the issue. There are measures which are required for the effective working of industry in a factory, and in the working out of those pro visions you need responsible people. I do not argue, and I do not believe that any responsible trade union leader—this does not include me—would argue that there are no responsible people who are not members of trade unions. Of course there are; but there are a considerable number of employers who judge their duty to their workpeople and indeed to their business wholly in terms of the balance sheet, so that they have been known to cut the corners. It has happened in the past that they were able to secure the people that they wanted, since there was not this provision to do jobs, which may not have been done according to accepted standards. So the unions are saying not that they should be members of a trade union but that they want to be sure that the people appointed recognise trade unions and are not, to put it bluntly, "bosses stooges". I put it in this extreme way only in order to minimise the number of words that I shall use. What the trade unionists, out of their great experience, are seeking to ensure is that whoever is appointed shall have their approval. It can be done by consultation. They could certainly appoint people, if you like, who are antipathetic to the whole trade union movement: but this provision ensures that the situation is not going to be stacked the other way. That seems to me to be the simple practical issue, and I hope that the noble Earl, Lord Gowrie, will accept that there is some substance in what I am saying. It may well be that the Government could perhaps look again at this provision and find a formula which would meet the views of the Party opposite. But to argue, as was done today both by the noble Lord, Lord Brown, and the noble Baroness, Lady Robson of Kiddington, that this is the thin end of "the wedge" in order to influence the principle on which workers' participation shall be subsequently worked out seems to me to be just dotty, dotty.


I want to add my voice to appeal to the Government to think again on this Amendment. This is the first time I have dared to open my mouth during the long debates we have had, but I have always wished to raise it on this Amendment. The pursuit of safety is not the monopoly of trade unions, nor of the 11 million workers who are not members of trade unions. The pursuit of safety is some thing which is, or should be, dear to the heart of everyone engaged in industry. I happen to have been Chairman for a good many years now of an organisation which is pursuing safety in the air. I grant you it is something rather different from the organisation which may develop from this Bill but nevertheless it is analogous, and the contribution towards safety made by those who were members of the union, the British Airline Pilots' Association and by those who were not members of the union, was tremendous. As a committee, we took no note of whether somebody was a trade unionist or not. All we wanted was to get the maximum contribution from an individual born of his experience and knowledge in the pursuit of safety. I feel strongly that the proposals in this Bill will deny a contribution to the pursuit of safety from many people who may not be members of trade unions.


There was some justice in the criticism made by the noble Lord, Lord Wigg, that I had turned the argument on its head because I had used a possible future hypothetical situation to support this Amendment. But let me try to convince him and others that this can be argued in its own right. Let us take an instance—which is not uncommon—of a factory which is introducing a new process, where various technicians, superintendents, middle-managers and so on have become aware of the fact that the process contains certain possible dangers. This is not uncommon. The manager of the department may well have raised with the plant manager, who no doubt has raised it with the managing director, the idea that very considerable delay should elapse and further sums of money should be spent before the new process is introduced, and this has been turned down. The people who know and have some insight into these dangers are at, let us say, middle management level. They are not members of trade unions and have not a representative on the safety committee. As individuals they have done their best. But one can advise one's seniors in the most vehement terms but, after going as far as possible, be turned down. It is said: "I have listened carefully, but I am not doing what you ask". That is the end of the matter for somebody in the role of manager.

However, it will be quite different if those middle ranks are allowed to elect a representative and feeling is widespread among technologists and managers that process ought to be delayed. The person who is the representative speaks anonymously as such and says, "Speaking for a large number of people at middle level in this company I tell you here and now that the feeling is that this process is dangerous," and that is a different matter. I wanted to add this argument about this Amendment in terms of safety committees, rather than base it purely on the hypothetical possibility that it would interfere with participation in the future.

4.11 p.m.


I should like to add my support for the Amendment, in the sense of the expression that it should be a perfectly open election of the best people to represent all the employees of any enterprise. The question of safety is not a monopoly of the trade unions; it is not a monopoly of management. It is for the good of all participating in the industry who are present in the works, plants, offices and the like. I must take issue with the noble Lord, Lord Wigg, over this Dickensian approach towards British management. I think he suggested there were managers or even directors who thought they might like to cut corners on safety, with a view to personal advantage of the company on the balance sheet—or perhaps he means the profit and loss account. This really is quite wicked. We must not say this sort of thing, any more than from these Benches we should say that there are elected representatives of trade unions who are out to do this, that or the other and destroy industry and so forth. There may be an individual case. One can think of a number of cases in recent past months. But to make the general lambaste that it is a management attitude to cut corners on safety is quite woeful and out of touch with the truth.

As I have said before in your Lordships' House, I happen to be directly connected with the chemical industry. Perhaps the noble Lord, Lord Wigg, has forgotten that, as to the most ghastly accidents which, alas!recently occurred, the proprietors were both nationalised industries—one Dutch State Mines and, the other, one of our own nationalised industries. Are we going to stand here and suggest it was the wickedness behind the ownership there that determined there should not be adequate supervision which it is alleged in the report caused the accident? Of course not. I beg your Lordships when speaking on matters of this kind—even if your Lordships have had such close control and interest in industry as has the noble Lord, Lord Wigg, whose industrial career escapes my memory at the moment—to show a far greater degree of restraint and not to suggest, in some quasi-Dickensian approach to industry, that there are wicked entrepreneurs out to risk the lives of and damage to their employees.

We are people of conscience in industry, whether we be on the shop floor or in management. Every association with which I have been connected, including those such as the Confederation of British Industry and the British Institute of Management, and indeed the institute of which I am president, the Plastics and Rubber Institute, are all desperately anxious that the maximum degree of safety should be paramount in the consideration of enterprises and in industry itself. I do not suggest for one moment that the unions are any more or less interested in safety than is management. We are all desperately interested and contributions from this House should. I submit, acknowledge that attitude.


When I was speaking, I did not have in mind such saintly characters as the one who has just spoken—of course not. My knowledge of sainthood and of perfection is extremely limited, like my knowledge of industrial relations. But I have a working-class background and I come from the same part of the world as the noble Lord, Lord Hewlett, and I know something of the management of companies. I am a kindly person and I am not concerned here with raising individual cases. What I want to do is speak about the Amendment. The noble Lord, in his anxiety to paint him self as a figure for a stained glass window —I almost bow at the idea when I look towards him—spoke about election. There is no question at all of an election. All that the trade unions want to do or have ever done, is born of their experience. They know the noble Lord and they know the kind of people who operate British industry.

Of course there are very good people among them. They have come to realise that there is virtue in handling the very expensive product of labour properly, but it was not always so. The last 200 years of the Industrial Revolution, particularly as it has affected the West Midlands, are not a picture of saintly characters who are out to look after their workers. I know only too well from my own family how the workers were treated by the Lord Hewletts and their kind. That is what brought me into politics. And if it is wicked to say it, I am going to continue being wicked. I would rather be wicked than be a humbug.

Here is a provision born of trade union experience. It may well be that that experience is now being invalidated, completely invalidated, by noble characters like Lord Hewlett. But the trade unions do not believe it. Perhaps they ought to believe it, but they do not. I long ago learned that when I was speaking to miners in my constituency I was really talking, not to them but to their grand dads I was speaking about the way their fathers and grandfathers had been treated. Of course that kind of treatment has long since vanished, but the social memory is there. It is atavism with which we have to deal. That is what I have been saying for the last two days. It may be myth. I am prepared to agree that 99.9 per cent. of it is myth, but in terms of grappling with problems we have to treat the myth as if it is reality.

This provision does not concern election. This clause requires that safety representatives be appointed by the trade unions. It may be utterly illogical. The noble Lord, Lord Balfour of Inchrye, made a point about the aircraft industry. There is one fundamental difference. In an aircraft, whether one is a pilot or a humble steward, one has a vital concern about safety, so the position is a little different. It is a new industry, also, and is not tied down with memories of the past. But when we are dealing with safety in mines and factories, we should remember that many factories are still the products not of the present clay but of the last century. We are dealing here with a fact that must be taken into account. which is that there will be greater confidence if those who are appointed are appointed by trade unions.

May I say to the Government that what I should like to see is this. I was convinced by the logic of the noble be found which will satisfy the Benches opposite and do what the trade unions obviously want to Earl, Lord Gowrie. I stand by what I have said, wicked or not wicked. It may well be that a formula can do. Try to seek the formula. I have nothing against that, but what I am not gong to respond to is the kind of argument we get from the Liberal Benches. On that point I reject Liberalism, because I have been a victim of it.


Not being in the world of industry, I would not for one moment plead any special knowledge of some of the subjects that have been mentioned. But the passionate outburst we heard just now absolutely amazed me. I will take only one series of diseases, the dust-borne diseases. Can the noble Lord. Lord Hewlett, say that employers in the past have had any sleepless nights about the high incidence of pneumoconiosis, silicosis, and byssinosis—all diseases which could have been reduced in incidence if more machinery of the extractor kind had been provided? There is evidence that, although it is known that these diseases could have been prevented, cynical employers did nothing about it. Can the noble Lord uphold what he has said in the light of this unmistakable evidence?


I am speaking of the present. We can go right back to the Industrial Revolution or, indeed, to the earliest forms of organisation long before what I take as the start of the Industrial Revolution—1761 and the building of the Bridgwater Canal. We are serving neither this House nor the country in any way if we insist upon being totally anachronistic in our approach. I am speaking as a post-war person in industry. I am not talking about the wicked 1880s, or the 1890s, or the 1930s. We would do very much better to talk about present and future conditions than to have this mania for going back into the past. The noble Lord, Lord Wigg, suggested that the safety committee representatives would be the stooges of the employers. It is that type of totally anachronistic approach towards the attitude of managers and directors in industry which is wrong so far as my own present knowledge is concerned. I have had only 25 years in industry, dating from 1975 back to 1950. Perhaps there is some other period that I should have experienced, but it is more to the point to talk of the experience one has had and not of what one has read about or been conditioned to think about which took place in the past. I am merely asking for the modern day approach. That is all.


Of course I am not talking about the last century. Does not the noble Lord do any reading on the subject before he comes and makes these passionate outbursts? I am talking about the last 20 years. May I suggest to the noble Lord that he should go back and do a little reading and then he will know his subject.


I apologise for jumping up and down like a jack-in-the-box, but I have got zig-zag vision and I can see only one place at a time; then I have to turn round to see another place. So I apologise to everybody. I will not say much and detain you long. It is far too important and critical a debate to do that. My grandson works on a building site. He does so because he is very happy in his work. He was victor ludorum at Eton for two years in succession, which is a minor record. He runs, jumps and throws and does all of those things. He works on a building site because he gets more money there than he would earn in any other way and he likes it. I asked him, "How do you go on about strikes?" and he said, None of us would join a union. We are out for money and we do not want to go on strike." That is the solution given by an ordinary boy to the problem, and many other people are thinking his way. Young people want to get on and they are thinking like this. At my age I do not suppose I shall ever be employed by anybody, but if I were younger I might think the same.

4.23 p.m.


We have had a fairly lengthy debate on this Amendment and it would be true to say that it is ground we have gone over a great many times before. Therefore, I do not intend to speak at any great length. I regret to have to say to my noble friend Lord Wigg, whose support I much appreciate, that after this long time I do not think there can be any possibility of any common ground between the Government's position and that of noble Lords opposite on this issue. The Government's intention throughout has been to limit the statutory safety representative provisions to safety representatives appointed by trade unions. There are a number of reasons for this.

First, it is thus made clear to trade unions that they are to shoulder more responsibility and to play a more active part in promoting the health and safety of the work place. As the noble Earl, Lord Gowrie, said, this is a responsibility that the TUC are anxious that the unions should discharge. Secondly, the unions are the bodies best organised to take on these responsibilities and in our view it would seriously weaken these provisions if we gave statutory rights and responsibilities to those who cannot make full use of them. Thirdly, if the legislation requires an employer to undertake consultations with his employees otherwise than through the normal channels, in many cases it will undoubtedly lead to serious industrial relations difficulties. Fourthly, the present provisions in the Health and Safety at Work Act, Section 2(5), have had the effect of giving legal rights and thus responsibilities to safety representatives who will not have an organisation to back them and to assist them in exercising these responsibilities. In practice, we just do not accept that employee representatives can be called to account by their constituents in the same way as democratically elected union officials. Fifthly, any apparent discrimination between the provisions for union and for non-union employees is more apparent than real because there is nothing to prevent the making or continuance of voluntary arrangements between an employer and his employees. This is a point I should like to make particularly to my noble friend Lord Brown, who, I think inadvertently, said that this was an attempt to prevent non-union employees from playing any part in health and safety at work. That is not at all the intention. Here we are talking solely about the granting of statutory rights. In our view, unless workpeople in completely non-union firms are well organised to take advantage of the rights which are conferred on them by Section 2 of the Health and Safety at Work Act, these rights will, in practice, be useless. Lastly, the Government's concern is to improve the standards of health and safety for people at work. Placing the responsibility firmly on trade unions is, in our view, a logical and an essential step towards this end.

The Earl of GOWRIE

Despite the great disagreement between the two sides, may I pay tribute to the crisp way in which the noble Lord, Lord Melchett, brought us back to the issues which are immediately before us. The noble Lord said that the main motive behind the Government's Amendment of the Health and Safety at Work Act was to encourage trade unions to take more responsibility, to initiate new moves in the safety and health field. We have absolutely no

quarrel with this; we would seek to encourage it. In sum, what we are objecting to is that the Government wish to do something negative as well as to undertake this positive maneuver. They wish to take away the right of someone who wants to take such responsibilities. My noble friend Lord Balfour of Inchrye mentioned the question of aeroplane pilots. Surely we would be in an absurd situation if those who fuel or service aeroplanes were able to elect safety representatives but pilots were not able to do so.

The noble Lord, Lord Melchett, also said that it would be bad to give rights and responsibilities to bodies or to people who cannot make full use of such rights and responsibilities. I simply cannot accept this argument. Apart from anything else, it would invalidate the principle of universal suffrage. He also said to his noble friend Lord Brown—who in earlier sections of the Bill has given me a quite sufficiently rough time for me to welcome wholeheartedly his support on this occasion since we know that the noble Lords speaks with great experience—that there was nothing against voluntary arrangements being made between management and non-unionised groups of employees. If this is true, why bother to repeal the section in the first place? Is it not surely the point that by repealing Section 2(5) of the Health and Safety at Work Act, the Government are taking away the rights of some people—perhaps half of the working population, as the noble Baroness, Lady Robson, pointed out—to insist on a safety committee for no other reason than that they are not trade unionists? It does not prevent the making or continuance of voluntary agreements, but it takes away the right of workers to ask for them. There is a serious division of opinion here and I think that we should reflect it in the Lobbies.

4.30 p.m.

On Question, Whether the said Amendment (No. 97A) shall be agreed to?

Their Lordships divided: Contents, 95; Not-Contents, 44.

Aberdare, L. Amulree, L. Balfour of Inchrye, L
Abinger, L. Armstrong, L. Barnaby, L.
Amherst, E. Balerno, L. Belstead, L.
Berkeley, B. Harmar-Nicholls, L. Rockley, L.
Bourne, L. Hawke, L. Sackville, L.
Brentford, V. Henley, L. St. Aldwyn, E.
Bridgeman, V. Hewlett, L. St. Davids, V.
Brookeborough, V. Killearn, L. Salisbury, M.
Byers, L. Kimberley, E. Sandford, L.
Campbell of Croy, L. Kinnaird, L. Sandys, L.
Cathcart, E. Lauderdale, E. Savile, L.
Clwyd, L. Long, V. Selkirk, E.
Cowley, E. Loudoun, C. Skelmersdale, L.
Cullen of Ashbourne, L. Macleod of Borve, B. Somers, L.
Daventry, V. Malmesbury, E. Stanley of Alderley, L.
de Clifford, L. Mancroft, L. Strange, L.
Denham, L. [Teller.] Merrivale, L. Strathclyde, L.
Drumalbyn, L. Middleton, L. Strathcona and Mount Royal, L.
Ebbisham, L. Monck, V.
Effingham, E. Monson, L. Strathclyde, L.
Emmett of Amberley, B. Mowbray and Stourton, L. [Teller.] Suffield, L.
Falkland, V. Terrington, L.
Foot, L. Northchurch, B. Teviot, L.
Fraser of Kilmorack, L. Norwich, V. Thurlow, L.
Gage, V. O'Neill of the Maine, L. Vernon, L.
Gainford, L. Orr-Ewing, L. Vickers, B.
Garner, L. Platt, L. Vivian, L.
Goschen, V. Porritt, L. Wakefield of Kendal, L.
Gowrie, E. Rankeillour, L. Ward of North Tyneside, B.
Grenfell, L. Reading, M. Wieoder, L.
Gridley, L. Rhyl, L. Wise, L.
Grimston of Westbury, L. Robson of Kiddington, B. Young, B.
Hailsham of Saint Marylebone, L.
Aberdeen and Temair, M. Goronwy-Roberts, L. Melchett, L.
Arwyn, L. Hale, L. Pannell, L.
Aylestone, L. Harris of Greenwich, L. Peddie, L.
Bernstein, L. Henderson, L. Phillips, B.
Birk, B. Houghton of Sowerby, L. Pitt of Hampstead, L.
Brockway, L. Hughes, L. Ritchie-Calder, L.
Buckinghamshire, E. Jacques, L. [Teller.] Segal, L.
Champion, L. Janner, L. Shepherd, L. (L. Privy Seal)
Collison, L. Kirkhill, L. Stedman, B.
Crook, L. Leatherland, L. Stewart of Alvechurch, B.
Crowther-Hunt, L. Lee of Asheridge, B. Strabolgi, L. [Teller.]
Donaldson of Kingsbridge, L. Llewelyn-Davies of Hastoe, B. Summerskill, B.
Feather, L. Lloyd of Hampstead, L. Wallace of Coslany, L.
Gaitskell, B. Lovell-Davis, L. Wigg, L.
Gardiner, L. McLeavy, L.

Resolved in the affirmative, and Amendment agreed to accordingly.

4.39 p.m.

Lords SANDYS moved Amendment No. 98: Page 87, line 15, leave out from ("unions,") to ("and") in line 16.

The noble Lord said: In rising to move this Amendment I would ask that we might also consider with Amendments Nos. 130, 131, 132 and 133. I should like to open my remarks by paying tribute to the comments of my noble friend Lord Gowrie, in his opening remarks on this clause, because your Lordships owe a great debt of gratitude to the noble Lord, Lord Robens of Woldingham, and his Committee in enunciating the principles which lie behind his comment upon the state of affairs.

I do not wish to repeat many of the valuable arguments which my noble friend Lord Gowrie has set before your Lordships in regard to this clause, but I should like to state that this Amendment, which interlocks with the previous one, relates exclusively to the law in regard to safety which applies to farm workers and those of cognate activity. Before us, we have the Health and Safety at Work etc. Act 1974. I should like to commend to your Lordships the present state of the law in this regard, because there is a very real feeling that what was established last year for the benefit of farm workers was something of which we can be proud. Every year we have, perhaps, rather too large a legislative harvest, but one of the particular features of the legislative harvest last year was this Act. Noble Lords in this House and Members in another place can feel proud that they have done something to assist in promoting a system which is worth while and should endure.

With regard to farm workers, at the present moment the Ministry is responsible for both drafting regulations and Codes of Practice, and their enforcement. It will be remembered that at the same time the Ministry is responsible for training. This should be very closely associated in your Lordships' minds with the practice of good safety. I have asserted, and feel extremely confident, that the industry as a whole recognises the present situation established in the Act, and the compromise reached with much difficulty last year was an important step towards higher standards of farm safety, which is common ground to all sides of your Lordships' Committee.

I was sad when the noble Lord, Lord Wigg, suggested that we should treat myth as a reality, because I do not believe that this is the right approach here. Some rather snide suggestions and assertions have been made in discussions in another place that agriculture is out on a limb and separated from the possible advantages to be derived from the thinking of the Safety Commission. Farm workers in fact will benefit considerably from the views of the Safety Commission. I would beg that your Lordships should look at Sections 12, 13 and 14 of the Health and Safety at Work etc. Act 1974. For instance, if I may weary your Lordships, though I will not quote at too great a length. Section 13 says: the Commission shall have power … to make agreements with any government department …". It does not say, "the Commission shall override other Government Departments", but says that it shall make agreements with other Government Departments. This is very much in the spirit of the wording of the Act.

If I may further trespass on the patience of your Lordships, Section 14 is very important, because should something go wrong in industry, and particularly, perhaps, with regard to the Amendment in the agricultural industry, the Safety Commission have power to set up an inquiry into any accident, occurrence, or situation. Sections 29 to 32 empower the Minister of Agriculture and the Secre- tary of State in Scotland to make all the necessary arrangements to perform their functions as drafting and enforcement authority for the safety regulations. We ought to consider the numbers concerned, because the farms associated with these regulations are approximately—and here I quote the Minister's own figures—65,000 farms where hired workers are employed and nearly 180,000 family farms, smallholdings and the like where there are no employees.

Taken together, these Amendments will replace the state of the law as it is at present. We believe the intentions of the Government are misguided in this regard. We believe it would be very worthwhile to leave the situation exactly as it is at the moment, for this excellent reason, that safety is being very well safeguarded by the officials of the Ministry. The Under-Secretary of State for Agriculture himself has responsibility for the Steering Committee. He is well provided with union representation on his Committee. The farm safety officers have the confidence of farmers, and in our view it is a situation which can command confidence not only inside but outside the industry.

Furthermore, I submit the present situation has a head start over other industries. Regulations have been advanced, while Codes of Practice, if not fully implemented, are at least in draft, and the situation is far in advance of what it could possibly be were the Safety Commission entirely responsible, as the Government have in mind. I beg the Government to re-examine the position, since I think there is a very strong argument for leaving this well alone.

4.46 p.m.


This matter was thrashed out thoroughly in a debate in this House 14 months ago, and I will not weary your Lordships by spending too much time picking up the threads of the argument. Briefly, however, when the Government first introduced the Health and Safety at Work etc. Bill, agriculture was recognised as being special among industries, and its Minister was to retain his responsibility for farm safety. There was then the last-minute turn-around, and when the Bill reached this House last year, agriculture was no longer special; the responsibility for farm safety was to go to the Health and Safety Commission. My noble friends and I were unconvinced that farming would become any safer by this organisational change, and so last year the Bill was amended to restore the responsibility to the Ministers of Agriculture. This decision was upheld in another place. As the noble Lord, Lord Sandys, told us, we now see in the Employment Protection Bill a short sentence in Clause 104 which, with its supporting Schedule 14, seeks to reverse the decision taken by both Houses of Parliament only a year ago.

I do not know anyone in the agricultural industry who is not concerned and distressed that their health, safety and welfare should become a kind of political football. It is not a Party matter at all. Everyone wants farming to be made safer. All are now agreed about the way in which the Inspectorate will operate. The point at issue is a purely administrative one—shall the Minister of Agriculture or shall the Health Commission have ultimate responsibility?

If one holds the view, as I do, that the Minister will do it as well, and probably better, then one must justify that by giving reasons why one disagrees with the Robens Committee recommendations on farm safety in saying that agriculture is a special case and should be treated differently from, for instance, coalmining or the construction industry. The chief reason given by the Government last year, before they changed their mind, was the special structure of the industry, where one had a multitude of small units scattered up and down the country. The existing method of carrying out inspection, instruction and enforcement of the farm safety regulations was, and is, very practical and economical. There were some 350 field officers whose duties took them to farms. While carrying out their other duties, they functioned as safety officers. This dual-purpose field inspectorate was responsible to divisional safety officers, and back to regional officers of the Ministry.

The organisation was adapted for the special structure of the industry, and for practical purposes one could use no other. It was thought that it would be anomalous to have field officers responsible to their own Ministry for part of their duties but to the Health Commis- sion for another part. For instance, if the field officer came to check your crop acreage he would be doing it for his employer, the Ministry of Agriculture, but if in so doing he noticed a piece of defective machinery, he became an agent of the Commission and ultimately responsible to another Minister. Therefore, the argument ran, leave the system unaltered and let the Minister of Agriculture continue making and enforcing safety regulations backed up by the resources and the wide expertise of the Health Commission, which would always be available to him. Also, agriculture was special in having its own Department, its own Minister, already responsible for a fully functioning and trained inspectorate armed with specialised knowledge and expertise. Another speciality of the industry was that the employers—I think the noble Lord, Lord Sandys, referred to this—and self-employed actually out-numbered employed persons. On half the farms there were no employed persons at all.

But when all this was said one still had an open mind, and one listened a year ago last July with great care to the noble Lord, Lord Hughes. He took enormous trouble, and I must pay tribute to the courtesy with which he treated my noble friends and myself, and the trouble he took in explaining how, if the Commission were to be in charge of farm safety, the regulations would be made and enforced. The Bill would enable, though not require, the Secretary of State for Employment to use the Ministry of Agriculture safety staff in its entirety on an agency basis. The chain of responsibility would go from the field officer right back to the most senior civil servant at the Ministry of Agriculture, but at that point, and in safety matters only, the Permanent Under-Secretary would be responsible not to his boss, the Minister, but to the Health Commission. Yet the Minister of Agriculture would still retain the power to make safety regulations. It seemed to be a grave reflection on the capacity of Ministers of Agriculture to assume that they would not possess the efficiency, vigour and impartiality which it was hoped would be the hallmark of the Safety Executive. The fear of Departmental partial interest, and perhaps inertia, persuaded the Robens Committee and the unions, and at a later stage the Government, not to trust future Agriculture Ministers with the responsibility for farm safety, and that fear is embodied in Clause 104 which we are looking at today.

Is it justified? Is farming getting safer? The accident figures are still distressingly high, but they are declining and not increasing. What the defects of the present system of inspection and enforcement were we were not told in the debate last year, but if it was defective in any way then, as I said last year, it may not be a matter of organisation; it may simply be a matter of numbers of inspectors. Since that matter was last debated, the Ministry of Agriculture can hardly be accused of lack of vigour over safety matters. The new cadre of full-time area safety inspectors has been created, and 60 of them took up their appointments, after special training, as early as last December; I believe there are now 75, so inspectorate numbers have increased. The Ministry of Agriculture last year set up a special steering group under the Secretary of State, to advise him and keep Departmental measures under review. I believe this group has been extremely active. I believe that the Ministry of Agriculture is better qualified than the Safety Commission to be responsible for safety measures specific to agriculture. I am sure your Lordships were right to insist last year that the Minister's responsibility should remain. Farm safety activity in his Department since then confirms this belief, which is also held by the farmers, and in view of the numbers in the industry who are self-employed, 64 per cent. of those who work on farms, their view should be given the most careful consideration.

The Secretary of State for Employment referred to us last year as the "comic old nobility" and the "built-in reactionary majority that performed monkey tricks" in insisting on amending the agricultural provisions of the Health and Safety Bill. There is nothing comic about a farmer having his ribcage crushed by a tractor or being gored by a bull; there is nothing comic about a farm worker having his legs sprayed by some chemical or having his lungs clogged with dust. Nor is there anything comic about the real concern that animates everyone in the industry that everything that can be done to reduce accidents shall be done. And there is nothing comic about trying to get the administrative machinery properly set up. I believe the Government are wrong in this matter of organisation. The wording of this proposal is set out in the later Amendment No. 133. I am sure that the kind of compromise it seeks to achieve commends itself to farmers, and, I sincerely hope, will commend itself to the National Union of Agricultural Workers. The good industrial relations which are such a benefit to agriculture are very precious. I beg them and the Government to consider very carefully whether perhaps in the end this may be the most satisfactory solution.

4.57 p.m.


Once again these arguments have been rehearsed many times, and I am sure noble Lords would not want me to speak at any great length. I should like to make two points to support the Government's view; first, to emphasise the need to avoid perpetuating a totally unjustified discrimination against agricultural workers; and, secondly, to emphasise the disadvantages and dangers of leaving agriculture in a special position in health and safety legislation. I am a fanner, and I simply cannot imagine that any modern farmer can really believe that there is not a large and growing area of common ground between agriculture and the remainder of industry. The Health and Safety Commission and the Health and Safety Executive are specifically and solely concerned with health and safety matters. The Government consider it right in principle that this new health and safety organisation should assume responsibility for health and safety in agriculture in the same way as for all other industries. We remain firmly of this opinion, since the safety hazards met on most farms are already similar to many common industrial hazards and this similarity is increasing all the time; for example, dangers from machinery and electrical equipment, toxic and dangerous substances such as some pesticides, fungicides and fertilizers, and dust. The so-called common accidents, slipping, falling, cuts and so on, are just as common, if not more so, on the farm as in the mine or the factory. Even the dangers which face those handling animals can be equated with those met with by workers in zoos, slaughterhouses, markets, transport industries and the docks.

Amendment No. 133, proposed by noble Lord opposite, which would require the Health and Safety Commission to report to the Secretary of State and the Agriculture Ministers is, in our view, unnecessary. The Commission is already required to make to the Secretary of State, as soon as possible after the end of each accounting year, a report on the performance of its functions during that year. In addition, full consultation between the Commission and the Agriculture Departments is already established practice. The Agriculture Departments must be consulted about any proposals for regulations or codes of practice which will or could possibly affect agricultural health and safety.

I do not want to go into great detail about the arguments; as I say, they have been covered before. The noble Lord, Lord Sandys, spoke of the power of the Commission under the Health and Safety at Work Act, Section 14, to direct investigations and inquiries. I should like to draw his attention to the last few lines of subsection (2) of Section 14, where it says—and it is here talking about the power of the Commission to direct investigations— The Commission … shall not do so in any particular case that appears to the Commission to involve only matters relating exclusively to agricultural operations. The noble Lord, Lord Sandys, spoke of the progress being made in the agricultural industry since the passing of the Act. This has been reasonable rather than remarkable progress. The Robens Report followed by preparations for the Health and Safety at Work Bill, and the passing of the Act itself, together gave an impetus to health and safety in agriculture in exactly the same way as they did elsewhere. Apart from setting up the Farm Safety Steering Group, which could, and perhaps should, have been done many years ago, what has been achieved is comparable in our view with achievements in previous years, and is certainly not in any way more outstanding than what has been achieved in the rest of industry.

The noble Lord, Lord Middleton, spoke of some statistics. I too, would direct your Lordships' attention to some statis- tics An examination of the figures that I shall give directs attention, perhaps even more strongly than I have already done, to the common ground shared by agriculture with other industrial work. As an example, in the three years 1972 to 1974 a comparison of fatal accidents in agriculture and factories shows the following. Falls from ladders and stairs resulted in five deaths in agriculture and 35 in factories, which is an incidence rate per 100,000 workers of 0.3 in agriculture and 0.2 in factories. Fatalities due to electricity were 11 in agriculture and 47 in factories, which is an incidence rate of 0.2 per 100,000 employees in factories, and 0.6—three times as many—in agriculture. There were four deaths in agriculture due to poisoning or gassing, and 23 in factories; twice as many deaths per 100,000 employees in agriculture as in factories. These figures speak for themselves. I am tempted to ask noble Lords opposite just how many extra agricultural workers need to die to put the agricultural industry in the cosy special position which noble Lords opposite seem so keen to perpetuate.


Would the noble Lord say what practical steps will be taken as the Bill stands? I understand that there will be two services; the agricultural inspectorate and the Ministry of Nealth inspectorate. Presumably they have to be amalgamated in some way. Will the agricultural experts inspect factories and the factory experts inspect agriculture, or are they to be kept separate, or are the agricultural ones to be made redundant?


I can give the noble Lord an assurance on that point. The chairman of the Health and Safety Commission has himself given an assurance that he is determined to maintain the momentum created in recent months by the work of the Farm Safety Steering Group. The Commission proposes to establish a series of advisory committees for the major industries, and has suggested that one of these should cover health and safety in agriculture. The chairman has said that he would want to see the Farm Safety Steering Group continue its work until such time as it might be carried forward by more general arrangements acceptable to the agricultural industry.


Has the noble Lord any idea which is the cheapest method of carrying out this work—the agricultural inspectorate or the new health and safety committees, and so on?


I think I have made it clear that the Government are in no doubt that the most efficient way of protecting the health and safety of agricultural workers is by including them in the general provisions of the Health and Safety at Work Act.


The noble Lord will remember that when we were debating the Health and Safety at Work Act I spoke strongly, complaining about the exclusion of agriculture at that time. It would therefore be churlish of me—and I do not want to repeat the arguments I used then—if I did not put on record my appreciation of what is now proposed, and assure my noble friend on the Front Bench that this will be welcomed by the Agricultural Workers' Union.

5.5 p.m.


I should like to refute some of the arguments which the noble Lord, Lord Melchett, has stated. We on this side of the Committee feel particularly distressed that the Government have adopted this position. The noble Lord, Lord Melchett, is a practical farmer whose views we must respect, and we must naturally also respect the views of the noble Lord, Lord Collison, who has pre-eminent knowledge of his former union, the National Union of Agricultural Workers, whose approbation—if that is not too strong a word—towards the Bill as it stands is acknowledged on this side of the Committee.

There are arguments here which may be set against what the noble Lord, Lord Melchett, has said. May I quote my own humble experience on a county agricultural executive committee in regard to safety some years ago. I think that safety statistics are misleading by comparison with industry. There is one fundamental reason for this. In a factory one has what might broadly be termed a predetermined situation. Line management can promote processes which are predictable in many instances. The same can hardly be said to be the case on farms, where very often a large number of decisions have to be made by individual workers whose skill and expertise are very much part and parcel of the job. Perhaps one can quote from situations which exist, and very often accidents happen to very skilled workers. It is the unpredictable that happens on the farm. It is not necessarily clumsiness or a lack of knowledge of the situation. It is the unpredictable.


I apologise for interrupting, and I do not want to prolong the debate, but I wonder whether the noble Lord would accept that exactly the same arguments apply to building workers—particularly jobbing building workers who are away from their firm on all the jobs they are doing—and other contractors such as window cleaners, and so on.


In this industry I do not feel that my experience is necessarily so wide. I accept that the degrees of risk may be somewhat similar, but once again we are short of statistics for comparison in this case. The noble Lord quoted his statistics for agriculture and industry as a whole, and I accept that there are probably building trades associated with industry among those figures.

The noble Lord, Lord Melchett, suggested that there were strong disadvantages for farm workers, and the noble Lord, Lord Collison, reflected that in his own view. I attempted in my earlier arguments to suggest that this was not a position which we felt was altogether true. The Health and Safety at Work regulations permit the flow of ideas from the Health and Safety Commission to reach the Ministry of Agriculture and their officials. The chain of communication is such that the advice and knowledge of the bodies can be extremely helpful and can interchange.

The noble Lord, Lord Melchett, cast doubt on the progress made within the agricultural industry, and I think he was a little unfair to reflect that not much had been achieved in previous years. Those who have been members of a Farm Safety Committee would feel that this was an unfair reflection on their activities. I do not wish to prolong the debate. We feel strongly on this matter, and I much regret that we will have to resort to the Division Lobby in order to solve the situation.


On Question, Whether the said Amendment (No.98) shall be agreed to?

Resolved in the affirmative, and Amendment agreed to accordingly.

5.19 p.m.

Clause 107 [Excluded classes of employment]:

Lord SANDYS moved Amendment No. 99:

Page 88, line 40, at end insert: ("( ) The following provisions of this Act do not apply to any employment in an undertaking in which immediately before the effective date of termination there were in the aggregate

Their Lordships divided: Contents,85: Not-Contents,53.

Aberdare, L. Gowrie, E. Rankeillour, L.
Amherst of Hackney, L. Grenfell, L. Reading, M.
Armstrong, L. Gridley, L. Redesdale, L.
Auckland, L. Grimston of Westbury, L. Rhyl, L.
Balerno, L. Hailsham of Saint Marylebone, L. Ridley, V.
Barnby, L. Rockley, L.
Belstead, L. Hanworth, V. St. Aldwyn, E.
Berkeley, B. Harmar-Nicholls, L. Salisbury, M.
Birdwood, L. Hawke, L. Sandford, L.
Bourne, L. Hewlett, L. Sandys, L.
Brookeborough, V. Ironside, L. Savile, L.
Campbell of Croy, L. Killearn, L. Selkirk, E.
Cathcart, E. Kimberley, E. Skelmersdale, L.
Clwyd, L. Kinnaird, L. Somers, L.
Cowley, E. Lauderdale, E. Stanley of Alderley, L.
Cullen of Ashbourne, L. Long, V. Strange, L.
Daventry, V. Loudoun, C. Strathclyde, L.
de Clifford, L. Mancroft, L. Strathcona and Mount Royal, L.
De L'Isle, V. Merrivale, L.
Denbigh, E. Meston, L. Suffield, L.
Denham L. [Teller.] Middleton, L. Terrington, L.
Digby, L. Monck, V. Thurlow, L.
Drumalbyn, L. Monson, L. Tweedsmuir, L.
Dundee, E. Mowbray and Stourton, L. [Teller.] Vernon, L.
Ebbisham, L. Vickers, B.
Emmet of Amberley, B. Moyola, L. Vivian, L.
Falkland, V. Northchurch, B. Ward of North Tyneside, B.
Fraser of Kilmorack, L. O'Neill of the Maine, L. Wise, L.
Gainford, L. Porritt, L. Young, B.
Goschen, V.
Aberdeen and Temair, M. Foot, L. Pannell, L.
Amherst, E. Gaitskell, B. Peddie, L.
Arwyn, L. Gardiner, L. Phillips, B.
Aylestone, L. Goronwy-Roberts, L. Pitt of Hampstead, L.
Bernstein, L. Hale, L. Platt, L.
Birk, B. Harris of Greenwich, L. Ritchie-Calder, L.
Boothby, L. Henderson, L. St. Davids, V.
Brockway, L. Houghton of Sowerby, L. Segal, L.
Brown, L. Jacques, L. Shepherd, L. (L. Privy Seal.)
Champion, L. Janner, L. Stedman, B.
Collison, L. Kirkhill, L. Stewart of Alvechurch, B.
Cooper of Stockton Heath, L. Leatherland, L. Strabolgi, L. [Teller.]
Crook, L. Llewelyn-Davies of Hastoe, B. Summerskill, B.
Crowthcr-Hunt, L. Lloyd of Hampstead, L Wallace of Coslany, L.
Donaldson of Kingsbridge, L. Longford, E. Wigg, L.
Douglass of Cleveland, L. Lovell-Davis, L. Wigoder, L.
Feather, L. Melchett, L. Winterbottom, L. [Teller.]
Fisher of Camden, L. Norwich, V.

(including the dismissed employee) less than four employees who had been continuously employed for a period of not less than thirteen weeks, whether they are, or had been, all employed at the same place or are or had been employed at different places, that is to say sections 37 to 44, 53, 62, 63to 71, and 90 to 98.").

The noble Lord said: This Amendment duals with excluded classes of employment and I can deal with it briefly. Under Part II of the Bill, which is concerned with the rights of employees, and under Part IV, which is concerned with the procedure for handling redundancies, there is a particular case for small businesses. On an earlier Amendment to Clause 93, on which my noble friend Lord Gowrie referred to the problems of smaller firms, the situation was cognate with that here. We feel strongly that there is a case with small businesses, especially in the farming industry where there are extremely few employed persons and in some cases none at all, that there should be this exclusion which should apply as written into the terms of the 1974 Act. If noble Lords wish me to develop the argument at length I am prepared to do so, but I feel that what I have said is probably sufficient, I beg to move.


No one wants to create a category of second-class citizens just because they are employed in very small businesses, but small firms are in considerable difficulties at this time and it cannot be denied that many of the provisions of the Bill will increase the problems of small employment units. I believe that one should balance the not excessive hardship that employees in very small firms may suffer by being excluded from the rights given under the sections listed in the Amendment, against the additional burdens that would be placed upon the small employers. These people make a not inconsiderable contribution to providing jobs, and there must be many to whom this extra statutory duty may be decisive in making the decision whether or not to retain or recruit employees.

As my noble friend Lord Sandys pointed out, the four-man business will, for instance, include most farmers who are employers of labour. To take an example from agriculture, Clauses 90 to 98 impose a duty on an employer to consult with a trade union in a prescribed manner on making anyone redundant. This seems rather absurd in the case of a farmer employing two or three men. If he has to make a man redundant, there is nothing much that the National Union of Agricultural Workers can do about it. It cannot force a farmer to go on employing a man if he cannot afford it and it does not normally act as an employment exchange in finding alternative work. The Government promised in Committee in another place to have special consideration for the small businessman and I join with my noble friend Lord Sandys in hoping that they will feel that the Amendment will give them the opportunity to do just that.


I wonder whether the questions which I am about to ask could be answered on the present Amendment, though they are not entirely relevant. This would save time rather than that I should ask them on the Question, That the Clause stand part. How does subsection (7), combined with Clause 90, affect seasonal employment? I can see that any seasonal employment which is for a fixed term of 12 weeks or less is excluded from the provisions of Clause 90. On the other hand, I do not feel that 12 weeks is a long enough period to cover a great deal of what one might call seasonal employment. In this connection, I can think of hotel work in the seaside resorts, which would be for perhaps six or seven months; of canning factories, which I believe work for parts of the year; sugar refineries have a season, too. Other people will be able to think of all sorts of employment which is for a season. The employer does not know precisely when that season will end when he takes on a person, but the implied contract is that the employee will stay until the job is finished for the season. It may very well be that the job will be for more than 12 weeks. However, seeing that the employee is, strictly speaking, a seasonal worker, I should have thought that he ought to be excluded from the consultations and so on which have to be carried out under Clause 90, because he knows perfectly well that his work will be completed at the end of the season and that he will not be required further.


I must protest again about the proposed exclusion of farm workers, though I realise, of course, that, as compared with farm workers, a very much larger number of people in other employments will be affected. Once again, what is happening is that farm workers are being made into second-class citizens. Those words were used by the noble Lord, Lord Middleton, in speaking to the Amendment. The history of farming and farm workers is that all along the line they have initially been left out when advances have been made. They were left out of the original Social Insurance scheme for pensions and sick pay. Up to now they have been left out of the general provisions for accident prevention, and now it is proposed that they should be excluded in this way. I mentioned earlier that I had spoken strongly about their exclusion from the safety and welfare provisions when the Bill was introduced in 1974. I did not want to repeat myself and I have done so a little, but I must stress that I feel very strongly about proposals of this kind which are aimed at putting farm workers into a different position from most other workers in this country.

5.29 p.m.


The Amendment seeks to exclude from five of the provisions of the Bill employees whose employer has less than four employees. The first exclusion which it seeks is exclusion from the maternity provisions. I should have thought that farmers would not be very much involved with this particular provision. I remind the Committee that the individual has to be in the employment for two years before there is any payment at all. Then, the payment is only for six weeks and it is by no means full wages. It is nine-tenths of the wage less the State allowance, which is at present £9.80 a week, so that it is considerably less than full wages for a limited period of six weeks. I must also stress another point. Is this exemption to be claimed if there is a proposal to pool the payments for maternity so that all employers pay a small percentage of the payroll? In those circumstances, would exemption still be claimed for the small firm? I believe that that must be faced up to.

As to re-engagement, I can understand that in the case of the small business there is a little difficulty in regard to re-engagement after a period of absence on the part of the employee. But I must point out that here again this will apply only to those who have been in the Service for two years, those who have given notice on the eleventh week before the confinement, and even afterwards, when they want to return, they have to give notice when they are doing so, and the employer can postpone the return up to a period of four weeks.

Industry, including the small firm, is already facing up to far greater difficulties in this area. Absences arising from ordinary sickness are far greater than absences due to maternity are likely to be. Because there has been this inevitable absence during sickness in the past, there has grown up means whereby temporary employees are available. For example, in the case of clerical work there are agencies which provide temporary employment to cover sickness, maternity or any other absence. Therefore facilities for the temporary replacement of employees who are absent sick can be applied in the case of maternity, and are there.

A second area of the Bill where the exclusion is sought is that concerning time off to look for work or to make arrangements for retraining. Surely because an employee works for a small firm he should not be denied the facility to look for other work if he is made redundant. This facility applies only where the employer has made the employee redundant. It does not apply in any other case. An application for time off must be reasonable and the maximum that can be allowed with pay is two days. Surely it is petty to claim exemption for small firms in a matter of this kind.

There is another area where exemption is sought. This is that small firms should be exempt from giving a written statement of reasons for dismissal. Surely if the employee of a large firm has a right to a written statement of reasons for dismissal, the employee of a small firm obviously has the same right. There is no good reason for discriminating between the two.

The fourth area with which we are dealing relates to unfair dismissal. I am sure that it would be patent to everybody that if someone is unfairly dismissed it does not matter a damn whether it is a small firm or a large firm that is involved; that employee is unfairly dismissed! The Amendment seeks to exempt the employee of the small firm not from complaining but from having any remedies. Let us be clear on that. In the Bill as it stands all employees have the right to complain if they think that they are unfairly dismissed.

Secondly, all employees, if they are shown to be unfairly dismissed, have the right to the remedies. This Amendment is trying to provide that those who are employed in small firms shall have the right to complain but shall not have remedies. This proposal is ridiculous and it goes right through the Amendment! Let me deal with the last point; that is, redundancies. All that a small firm has to do is simply to inform the trade union. There is no other obligation from which exemption is sought. Exemption is sought from simply informing the trade union of the redundancy.

I suggest that when analysed in detail this Amendment is seen to be absurd. Our position is quite clear. We are proceeding with this type of legislation be cause we want to bring this country—in terms of labour legislation—into line with the EEC. To the best of our know ledge, and looking at all the evidence available to us, we know of no case in the EEC where there are these kind of exemptions for small firms. Such exemptions would put us out of line with the EEC, and would put us in difficulties when there is a Directive seeking uniformity.

Our position on this matter was very well stated by Mr. Carr when he was Minister of Employment. On 18th October 1971 he was introducing the Code of Industrial Relations Practice under the 1971 Act, and what he said is reported in Volume 823 at column 391 in the Official Report. In accordance with the practice of your Lordships' House I shall not quote his words, but rather paraphrase what he said. Mr. Carr said that he had received strong representations from small firms, and while he appreciated their difficulties he felt that one fundamental feature of the Code was the universal applicability, and that must be retained. That is what we feel in regard to this Bill: the universal applicability is a fundamental feature.

Mr. Carr went on to say that to depart would weaken the influence of the Code and the incentive to good industrial relations. He further said that it would make a too easy gateway of excuse for those people who were not prepared to go ahead with better industrial relations. That is exactly what we feel in regard to this Bill. By creating this small gateway to let out a small firm we would be giving the excuse for those who are not prepared to face up to the fact of proper employment protection.

We feel rather strongly on this Amendment, as noble Lords might gather. An exclusion of the kind proposed in the Amendment raises issues of principle. The Government find it quite unacceptable that employees in small firms should receive a lower standard of protection than those in larger firms. We cannot accept that an individual employee should be excluded from the important rights provided by the Bill simply because his place of work happens to be a small undertaking rather than a large one. I feel so strongly about this that if the Committee carry the Amendment I should regard it as a travesty of justice.

5.37 p.m.


The noble Lord, Lord Jacques, has set before your Lordships the Government's case with a degree of knowledge and, if I may say so, a degree of passion which indicates that we must tread warily in this field. The situation is quite clear. The small firm and the small business, not only in this country, but in Europe and in many parts of the world, feel many of the same currents of competition and problems, which are universal. In Canada, and I understand in various other territories, this situation is treated by having a Minister within the Government concerned, who is responsible for the affairs of small firms and small businesses; and this does not apply to one territory alone.

The noble Lord, Lord Jacques, referred to the situation within the EEC. This is very important, because every day we increase our contact and our communication in regard to administration in Europe. It is our view on this side of the Committee that some new channel of communication, some Ministerial responsibility for small firms, could be beneficial in this regard; and many of our partners in Europe believe the same thing.

It is probably not appropriate to quote chapter and verse at the moment, and indeed I do not have the information regarding the regulations before me. But with regard to the remarks of the noble Lord, Lord Collison, I hope that he will acquit me and my noble friend Lord Middleton of anything which we said—and I am sure that we did not say it—with regard to the position of agricultural workers. It has never been, and is not now, our intention to produce circumstances in which agricultural workers are any less favourably placed than any other workers. Indeed it is absurd to make this suggestion. I am sure that the noble Lord did not mean it, and I hope that he will acquit me of making that assertion.

The noble Lord—as indeed did the noble Lord, Lord Jacques—referred to the position regarding reasons for dismissal et cetera. We are on common ground on many points. We put down this Amendment as a probing Amendment, and it would be for the benefit of your Lordships, and certainly for the benefit of good administration in this field, if I were to withdraw the Amendment, reserving my absolute right to return to this matter with Amendments at a later stage in the Bill.


I would never accuse the noble Lord opposite of seeking to create a situation in which agricultural workers were inferior. This is not a personal matter at all. But the fact remains that over the years agricultural workers have always found themselves treated less well than work people in the other great industries. The case is there to be seen. When social security was introduced initially farm workers were left out.

When we get into the field of industrial negotiations on things like hours, overtime and holidays agricultural workers always brought up in the rear, and indeed they still do. I know that this is not the place to debate other issues, but in terms of what they can take home, again they are way behind the take-home pay of other work people.

I am saying all this simply to make it clear that I should be horrified if I thought myself capable of making a personal accusation of the type which the noble Lord opposite thought perhaps might be inferred. It certainly was not. But I stand by my statement that agricultural workers feel themselves treated as second-class citizens and this is another example of the type of action which makes them feel just that.

Amendment, by leave, withdrawn.

5.41 p.m.

The Earl of GOWRIE moved Amendment No. 99A: Page 89, line 14, leave out ("16") and insert ("21").

The noble Earl said: With the leave of the Committee, I should like to speak at this time to my Amendments to Schedule 15 and I would remind your Lordships that those are Nos. 142A to 142J. All these Amendments are concerned with the definition of part-time employment. They should all be taken together as the same principle applies to them. The definition is based on the provisions of paragraphs 3 and 4 of Schedule 1 to the Contracts of Employment Act 1972 which paragraph 13 of Schedule 15 to this Bill seeks to amend. The emphasis must therefore be placed on the above Amendments to Schedule 15. The Amendments to Clause 107 are virtually consequential. Paragraph 3 of Schedule I to the Contracts of Employment Act lays down that: Any week in which an employee is employed for twenty-one hours or more shall count in computing a period of employment. Paragraph 4 goes on to say: Any week … governed by a contract of employment … for twenty-one hours or more weekly … shall similarly count.

The rights provided under the Act are subject to employees completing certain specified periods of employment so that anyone who works for less than 21 hours a week does not qualify for them. Similarly, under the Redundancy Payments Act, employees who work for less than 21 hours a week do not qualify for redundancy payments. This delineation follows the accepted definition of full-time and part-time work in industry. Employees who work 21 hours or more are regarded as full-time workers and those who work less than 21 hours are regarded as part-time workers. The length of the normal working week for manual workers in this country is generally taken as 40 hours; some work more, of course, and some less. White-collar workers generally have a shorter working week, but on the other hand the average week actually worked by full-time adult manual workers is normally about 44 to 45 hours. It is significant that the EEC recommendation on the application of the 40-hour week and four weeks' annual holiday lays down that member countries should aim at implementing the 40-hour week by the end of 1978. It is perhaps even more significant that the Government's temporary employment subsidy scheme excludes anyone working on average less than 21 hours a week.

On this basis it is clearly logical and reasonable that anyone who works only half the normal working week; that is to say less than 20 hours, should be classed as a part-timer. He is not fully committed in hours to his employment and since one full-timer can do the work of two or more part-timers, part-timers have traditionally been entitled to less privileges than full-timers. That would only seem to be equitable.

The effect of certain of the provisions of this Bill would be to change the definition of a part-timer from a person who works less than 21 hours a week to one who works less than 16 hours. Further, the Bill also provides that a person who has been employed for only eight hours a week for five years should be treated as full-time. Clause 107(8) to (11) then goes on to provide that only employees who work less than 16 hours a week or who have worked between eight and 16 hours a week for less than five years, shall not be entitled to time off under Clauses 49, 50 and 51 and not entitled to itemised pay statements. Our Amendments seek to retain the present definition of a part-timer as a man who works less than 21 hours a week and as a compromise to allow a man who has worked for 16 hours a week for five years to be regarded as a full-timer. I beg to move.


Although at first sight it would appear that these are a complicated set of Amendments, their objective is quite simple. The Amendments seek to maintain the existing limit of 21 hours a week for the exclusion of part-time employees from statutory rights based on their employment. The only concession made to progress would be to enable employees whose weekly hours of work are reduced below 21 but not below 16 to retain their eligibility for 26 weeks and to enable employees who normally work for between 16 and 21 hours to qualify for certain rights after they have completed five years' continuous service with an employer.

The Bill as it stands would exclude 9 per cent. of working women from the protection of the Bill—the 9 per cent. work less than 16 hours. The Amendment would exclude not 9 per cent. but 20 per cent. who work less than 21 hours. In the past, the exclusion of part-timers from rights to employment has been justified largely on the basis that people who take a part-time job are working only for pin-money. But this conception of part-time employment is just not valid. The findings of the Finer Report have demonstrated the vital importance of part-time employment to many single parents. There is plenty of evidence to show that part-time employment of working mothers contributes an essential part of the income of the lower income families. In our view, employees whose working hours are restricted by unavoidable domestic commitments should not be deprived of rights that are available to other employees who are free from those commitments.

We accept that there comes a point where a part-time employee's relationship with his employer is so tenuous that his employer should not be expected to grant him the sort of rights conferred by this Bill. However, we take the view that where an employee works for the equivalent of two full days a week for his employer he should not be excluded from the protection afforded to employees who are free to work longer hours. With this explanation, I ask the Committee to reject this Amendment.

The Earl of GOWRIE

It seems to me curious that the noble Lord, Lord Jacques cited the question of women who work part time in connection with my Amendment. Surely the noble Lord is not suggesting that a woman who works part-time—for pin-money as he put it—should be entitled to redundancy payment if her employer can no longer afford to keep her after five years. He said that my conception of part-time employment would not hold. I cannot accept that his does. Of course those of us who, with the Finer Committee, care for the problems of single parent families, for women on their own bringing up children and who can work only at certain hours of the day, surely cannot accept this provision.

I think the noble Lord also skirts over the cost to industry of the exention of the provision of benefits under this Part of the Bill to employees generally. I suggest that this is not a good time for adding to industry's costs. I should think—and I will not press the Amendment for this reason—that working people themselves will in time pressure the Government to reform this Part of the Bill. This is because the increase in costs under these provisions will mean rather less jobs being given on a part-time basis. Even now it is cheaper to employ one 40-hour week worker than two 20-hour workers. If the part-timers later become still more expensive, as we contend they will, the result will be fewer jobs for them. I contend that this would hit particularly hard the married woman and those other classes of workers cited by the noble Lord; Lord Jacques, who find it essential to work but cannot work full time because of family commitments. I think that in their own interest the Government should look at this again. If they do not, there will be considerable pressure from working people, from single-parent families and the like to amend it. I beg leave to withdraw my Amendment.


I wonder whether the noble Lord, Lord Jacques, is in a position to reply to the queries that I made when speaking on Amendment No. 99; or would he like me to repeat my speech?


The period of 12 weeks was fixed in consultation with the Agricultural Departments and we are advised that this would cover the vast majority of seasonal workers in all industries.

Amendment, by leave, withdrawn.

Clause 107 agreed to.

Clause 108 agreed to.

Clause 109 [Application to Crown]:

5.52 p.m.


This is a drafting Amendment. I beg to move.

Amendment moved—

Page 94, line 22, at end insert— ("(e) the reference in section 18(1)(e) above to the employer's undertaking shall be construed as a reference to the national interest; and (f) any other reference to an undertaking shall be construed, in relation to a Minister of the Crown, as a reference to his functions or (as the context may require) to the department of which he is in charge and, in relation to a government department, officer or body, shall be construed as a reference to the functions of the department, officer or body or (as the context may require) to the department, officer or body.").—(Lord Jacques.)

On Question, Amendment agreed to.

Clause 109, as amended, agreed to.

Clause 110 agreed to.

Clause 111 [Financial provisions]:


I spoke to this Amendment when advising the Committee to leave out Clause 34. I beg to move.

Amendment moved—

Page 95, line 28, at end insert ("except sums which are expressly required to be paid into the Redundancy Fund or the National Insurance Fund. (5) As respects any increase attributable to the provisions of this Act in the expenses which under section 135(3)(a) of the Social Security Act 1975 are to be paid out of moneys provided by Parliament, subsection (1)(b) above is without prejudice to the provision made by subsection (5) of that section for reimbursement out of the National Insurance Fund.")— (Lord Melellett.)

On Question, Amendment agreed to.

Clause 111, as amended, agreed to.

Clause 112 agreed to.

Clause 113 [Interpretation]:


This is a drafting Amendment simply to bring the clause into line with a similar provision in Section 29 of the Trade Union and Labour Relations Act 1974. I beg to move.

Amendment moved— Page 96, line 13, after ("to") insert ("or connected with").—(Lord Jacques.)

On Question, Amendment agreed to.

Clause 113, as amended, agreed to.

Clause 114 agreed to.

Clause 115 [Northern Ireland]:


This is purely a drafting Amendent to tidy up some rather loose wording. I beg to move.

Amendment moved— Page 99, line 34, leave out from ("and") to end of line 35 and insert ("the Northern Ireland Redundancy Fund.").—(Lord Jacques.)

On Question, Amendment agreed to.

Clause 115, as amended, agreed to.

Clause 116 agreed to.

Schedule 1 [Advisory, Conciliation and Arbitration Service]:

Lord SHEPHERD moved Amendment No. 104: Page 102, line 44, at end insert ("such an appointment shall not be made without the consent as to terms and conditions of service of the Secretary of State, and such consent shall not be given without the approval of the Minister for the Civil Service.")

The noble Lord said: In moving Amendment No. 104, with permission I will speak to Amendment No. 106. Amendment No. 104 remedies an omission in Schedule 1, paragraph 6. As drafted, it lacks any provision for terms and conditions of service for the Secretary of State when he is appointed under that paragraph. The Secretary of State's consent to the terms and conditions is to be required; also the approval of the Minister for the Civil Service is required. This is the usual formula which appears elsewhere in the Schedule.

Amendment No. 106 has the effect of removing paragraph 30, which is no longer necessary when the amendment to paragraph 6 has been made, taken in conjunction with paragraph 7, which provides terms and conditions for other officers and servants of the Service. I beg to move.

On Question, Amendment agreed to.


I beg to move Amendment No. 106 formally.

Amendment moved— Page 106, line 32, leave out paragraph 30.—(Lord Shepherd.)

On Question, Amendent agreed to.

Schedule 1, as amended, agreed to.

Schedules 2 to 10 agreed to.

Schedule 11 [Extension of terms of conditions]:

6.0 p.m.

The Earl of GOWRIE moved Amendment No. 125A: Page 141, line 11 after ("conditions") insert ("substantially less favourable than").

The noble Earl said: We now come to the second of our debates on the extensions of the terms and conditions of employment—our first debate having taken place on Clause 4 on the first day of the Committee stage last Monday. No part of the Employment Protection Bill has been the subject of more misunderstanding and controversy than Schedule 11, which repeals Section 8 of the Terms and Conditions of Employment Act 1959 and seeks to establish a new system for raising substandard pay and conditions combining features both of Section 8 and of the Fair Wages Resolution. Clause 89 of the Employment Protection Bill provides for the repeal of Section 8, as I have said.

Part I of Schedule 11 provides that an employers' association or an independent trade union having members in a relevant trade, industry or section in a district, may make a claim to the Central Arbitration Committee of ACAS that an employer is applying to his employees terms and conditions less favourable than the recognised terms and conditions (this term includes national minimum rates established by industry agreement). If the Central Arbitration Committee find the claim to be well-founded, it may order the employer to observe the recognised terms and conditions, accordingly. Where there are no recognised terms and conditions, the same procedure may be used to claim that the terms and conditions being applied by an employer are less favourable than the general level. The Schedule goes on to define the general level as those terms and conditions observed for comparable workers by employers in the same trade, industry or section, in the same district, whose circumstances are similar.

The first limb of this provision, dealing with the situation where recognised terms and conditions exist, is virtually the same as Section 8 of the 1959 Act. It is not expected to give rise to any new problems, and we are not contesting the principle here. The second limb, which provides for comparisons with the general level, is new in that it applies to the whole of industry a provision for the Fair Wages Resolution, which at present applies only to Government contractors. It is this second limb which, in our view, is likely to prove dangerous in terms of industrial relations, and, in terms of the national economy, highly inflationary. The difficulty arises from the imprecise nature of the term "the general level of terms and conditions", and the consequences that are likely to flow from giving all employees who are employed on less favourable terms the right to be brought up to the general level.

We understand from various Government statements that the purpose of these provisions is to deal with small pockets of low paid workers. In Standing Committee in another place the Minister of State for Employment provided an example of how he envisaged these provisions would work. He suggested that where there are ten companies, of which two are high payers, seven pay about the same and one is a low payer, these provisions could be used to claim that the one low payer should be brought up to the level of the seven, though he did not say which one of the seven. Unfortunately, the Minister of State's example is not, in our contention, typical of the situation in industry. In reality, even in a geographical district, there will be a broad spread of wage rates which may vary by as much as 50 per cent. or 100 per cent. from top to bottom. In simple language, some employers are better off than others. A fairly usual spread, if illustrated in the form of a graph, will produce a bell-shaped curve, with a small number paid at the top rates, a growing number in the middle ranges, and fewer at the lower rates. It is not uncommon, however, in some districts, to find a completely haphazard spread.

How then are we to interpret these provisions in this kind of case? In Standing Committee, one Labour Member of Parliament suggested a simple solution: in his view it meant that everyone below the average for the district should be brought up to the district average. He apparently saw nothing wrong in suggesting that comparable wages should be paid for comparable work, but a moment's thought will surely demonstrate the highly inflationary and dangerous procedure that this would introduce. It is a simple statistical exercise to show that the theoretical effect of raising to the average all those who fall below it, is eventually to raise everyone to the highest. In practice, of course, long before this happens the highest paid will have sought to restore the differentials, leading to a mad chase for higher wages and the inflationary consequences with which we are so familiar.

Besides its potential for wage escalation, the term, "the general level of terms and conditions", poses another very real danger. If it means anything like the average district rate, it will almost certainly be higher than the rates laid down in the majority of industry-level agreements, all except one of which lay down rates which individual employers may, and generally do, exceed. If this procedure is used to any great extent, it will provide a very strong incentive to trade unions to abrogate their national agreements. National agreements, even when they lay down minimum rates, are a strong stabilising factor. Their abandonment would be a retrograde step and could add impetus to the inflationary wage chase. It could also lead to the withering away of the national bodies, such as the Joint Industrial Councils, through which such agreements are negotiated. This, too, would be highly undesirable.

Our Amendment is designed to assist the Government to achieve what the Minister claims to be its objective—to deal with "pockets of low pay". In order to do this, one must first identify who such people are. In our view a pocket of low pay must be a group of workers paid significantly less than the normal range of other workers in their trade or industry; something which sticks out like a "sore thumb" below the normal range of rates paid in the district. This is what our Amendment is designed to achieve. In ordinary language, it will have the effect of saying: "Where there are no recognised terms and conditions, or nationally agreed minimum terms and conditions, a union can bring a claim that some workers are being paid substantially less than the broad average in the district". The word "substantial" is, incidentally, I understand, a recognised legal term.

My last point is this. On the first day of the Committee stage in our debate on Clause 4, I argued that Schedule 11 was totally at odds with the Government's counter-inflationary policy—the £6 a week limit—and that this confusion would put ACAS in an intolerable difficulty in discharging its obligation to advise employers. What would happen, I argued then, if this bombshell in Schedule 11— which our Amendment seeks to defuse—the doctrine of comparability, were used to drive a coach and horses through the present £6 limit or, indeed, through any future statutory or voluntary incomes policy. There was no satisfactory answer from the Government. I contend that there will still be no satisfactory answer. The Government designed this Bill, as I then said, under Social Contract Mark I, which failed. They must in my view accept our Amendment so that Social Contract Mark II will have a chance of success. I seek to help the Government, and that is why I beg to move the Amendment.

6.10 p.m.


I have listened to the noble Earl with considerable care, and since it is an important point I hope the Committee will forgive me if I speak a little longer than is usual on Commit tee stage and at this hour. The noble Earl is quite correct in saying that the primary purpose of Schedule11 is to help isolated pockets of low pay in industry to be dealt with and it is certainly not intended to increase pay levels generally. This has been done by re-enacting one provision; that is, Section 8 of the Terms and Conditions of Employment Act 1959, which was passed by a Conservative Government and about which we have not as yet heard any complaint of its inflationary effects. Secondly, we are extending to everybody the rights which were given in the Fair Wages Resolution only to workers in establishments holding Government contracts. I suggest this is not such a radical step as the noble Earl might wish to think, for although we do not know what proportion of the workforce is at present covered by the Fair Wages Resolution, it must be substantial. It is worth stressing that it is not just workers engaged on Government contracts who are covered by the Fair Wages Resolution but all those working in any establishment in which any work is being done on a Government contract.

The Government have so far received no complaint over the years that where the Fair Wages Resolution has been in force it has increased the rate of inflation. The provisions of Schedule 1, allowing claims to be made on the basis of the general level of terms and conditions, have been attacked in another place and it has now been criticised by the noble Earl. I think there is some misunderstanding about the difference between the general level and the average. The general level is not the same as the average. The concept of the general level of terms and conditions is taken from the Fair Wages Resolution, and those who have been interpreting that Resolution over the years have not held that the general level means the average. On the other hand, some have put forward a different argument, accepting that the general level and the average are not the same thing. It has been argued that the effect of Schedule 11 will be to bring the low paid in an industry up to the general level prevailing, thereby creating a new and higher average level of pay among similar employees in the district. That is the point made by the noble Earl. This in turn will encourage the pace-setting employers to raise their wages, thereby creating a new general level for the low paid to reach for, and so on, ad infinitum. The result would be that the lower paid would never achieve any real, relative or permanent advance and all that would happen would be that wage levels generally would be pushed up faster.

Such an argument, in my view, is too simplistic for several reasons. The labour market is, of course, a dynamic market which is constantly adjusting to changes in the demand for labour and prevailing rates of pay. The most important force in the market must be the supply of, and demand for, labour of a particular kind, though institutional arrangements can also have a marked effect on the way in which wage rates respond to changes in supply and demand. What is being suggested by the noble Earl and critics of Schedule 11 is that the effect of Schedule 11 is to speedup significantly the rate of change of average levels in some industries, perhaps many industries. I suggest that the validity of this conclusion will depend on many factors: the extent to which unions seek to pursue claims for improvements under Schedule11, the number of people covered by these claims, the rate of success of the claims made, the impact of any wage level adjustments made as a result of the claims and whether they are important enough to trigger off significant market adjustments.

Our experience of the Fair Wages Resolution—and in its present form it is almost 30 years old—provides no grounds for believing that the cases brought under Schedule 11 will be very numerous. In general, we do not expect unions to bring claims against employers who already recognise them or negotiate with them. We would expect, rather, that the impact of this legislation will be felt mainly in the unorganised sector of industry, among employers whose wage levels have a limited impact upon the labour market. We should also bear in mind that where there is a national or district agreement setting minimum standards in an industry, unions will not be able to base claims on the general level of terms and conditions but only on those recognised terms and conditions arrived at by the collective agreement. In a very substantial part of British industry, therefore, unions will be able to pursue claims only under these provisions of Schedule 11 which replace Section 8 of the 1959 Terms and Conditions of Employment Act.

It has been argued by the noble Earl that if we dropped Clause 89 and Schedule 11 we would avoid prejudicing the Government's measures to bring about a decrease in the rate of inflation. We do not accept that Schedule 11 will give any significant boost to inflation. In so far as inflation has been due to excessive wage settlements, those settlements have concerned in the main, but not entirely, highly organised sections of industry where unions have considerable bargaining power and have no need to rely on the provisions of the Schedule. By comparison, therefore, the elimination of pockets of low pay as a result of claims lodged under Schedule 11 is unlikely to have more than a marginal effect on the total labour costs or on the claims and settlements made in industry generally.

The noble Earl has moved his Amendment. He spoke of the reasons why he introduced it and I think he was trying to be helpful. 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.

In speaking to this Amendment, I have sought to assure the noble Earl that the provisions of Schedule 11 in our view, are not inflationary. They deal with pockets of low pay, which I am sure it is in the interests of everyone to deal with, and all the experience we have had of the Fair Wages Resolution leads us to believe that there is a fair understanding of the basis on which claims are considered and dealt with. I hope the noble Earl, with this explanation, will agree to withdraw his Amendment.

The Earl of GOWRIE

The noble Lord the Leader of the House suggested that my arguments about what in shorthand could be called the "leapfrogging effect" of pay claims under Schedule 11 were too simplistic. Certainly I would accept from him that they were pretty condensed, and that we could perhaps toss the ball back and forth for some considerable time but this would not he appropriate. He also accepted from me that I was trying to be helpful and that was not just a rhetorical or mischievous phrase. I am concerned about the genuinely inflationary effects, as we see them, of the Government's provisions. But that side of his argument was the philosophic disagreement between us, if I may put it that way.

The substantive part of his argument, if I read him aright, was that the experience of the Fair Wages Resolution—which he pointed out had been in force for many years—gave no evidence that it was inflationary or that it could be used to raise the average so that those above the average would then seek to re-establish their differential position to the average.

But the fact that the fair wages resolution contained a similar formula with out producing such a result is, in my view, little to the point because it applied only to Government contractors, whereas the noble Lord and this legislation are seeking to apply it to everyone.

I also think I can give some concrete evidence that the fair wages resolution is starting to be inflationary in its effect, because under the last Government's counter-inflationary policy some unions in the white collar field were showing their interest in exploiting the fair wages resolution in order to improve their position. I do not criticise unions for seeking to exploit loopholes to improve their position; that is exactly what they are there to do. But we in Parliament must try to see that such loopholes are kept to a minimum, particularly during an inflationary crisis.

The noble Lord also suggested that trade unions do not like using arbitral bodies for this kind of purpose. But I find this guesswork. If the unions find the procedure under Schedule 11 useful, surely it is their job to use it. It will be of particular significance in any period of incomes policy, voluntary or compulsory. Right across the Committee we have different views about the wisdom of statutory or voluntary incomes policies, but all of us, I think, whatever our position, are agreed that one version or another is here to stay at the present

Resolved in the affirmative and Amendent agreed to accordingly.

time. With respect, the noble Lord the Leader of the House did not answer my question, any more than he answered it satisfactorily in our debate on Clause 4. In conclusion, it seems to me really remarkable that a Government which recognise the inflationary dangers involved, as their pamphlet to every household in the country can demonstrate, are apparently prepared to take these risks. In our view, the Government are undercutting their own policy; it is foolhardy to do so, and with this in view I feel I must divide the Committee.

6.23 p.m.

On Question, Whether the said Amendment (No. 125A) shall be agreed to?

Their Lordships divided: Contents, 68; Not-Contents, 43.

Aberdare, L. Gainford, L. Redesdale, L.
Alexander of Tunis, E. Goschen, V. Ridley, V.
Amherst of Hackney, L. Gowrie, E. Rockley, L.
Armstrong, L. Gridley, L. St. Aldwyn, E.
Balerno, L. Hailsham of Saint Marylebone, L. Sandford, L.
Barnby, L. Sandys, L.
Belstead, L. Hanworthy, V. Savile, L.
Berkeley, B. Harmar-Nicholls, L. Skelmersdale, L.
Brookeborough, V. Hawke, L. Somers, L.
Campbell of Croy, L. Ironside, L. Strathclyde, L.
Cathcart, E. Killearn, L. Strathcona and Mount Royal, L.
Cottesloe, L. Lauderdale, E.
Cowley, E. Long, V. Suffield, L.
Craigavon, V. Loudoun, C. Terrington, L.
Daventry, V. Merrivale, L. Thurlow, L.
Davidson, V. Middleton, L. Trefgarne, L.
De L'Isle, V. Monck, V. Tweedsmuir, L.
Denham, L. [Teller.] Mowbray and Stourton, L. [Teller.] Vernon, L.
Digby, L. Vickers, B.
Dundee, E. Moyola, L. Vivian, L.
Ellenborough, L. Newall, L. Ward of North Tyneside, B.
Emmet of Amberley, B. Northchurch, B. Wise, L.
Falkland, V. Penrhyn, L. Young, B.
Gage, V. Reading, M.
Balogh, L. Jacques, L. Phillips, B.
Birk, B. Janner, L. Pitt of Hampstead, L.
Brockway, L. Kirkhill, L. Platt, L.
Collison, L. Kissin, L. Ritchie-Calder, L.
Cooper of Stockton Heath, L. Leatherland, L. St. Davids, V.
Crook, L. Llewelyn-Davies of Hastoe, B. Segal, L.
Crowther-Hunt, L. Lloyd of Kilgerran, L. Shepherd, L. (L. Privy Seal)
Donaldson of Kingsbridge, L. Lovell-Davis, L. [Teller.] Southwark, L. Bp.
Douglass of Cleveland, L. Melchett, L. Stedman, B.
Feather, L. Meston, L. Stewart of Alvechurch, B.
Gaitskell, B. Morris of Borth-y-Gest, L. Wallace of Coslany, L.
Gardiner, L. Paget of Northampton, L. Wigg, L.
Hale, L. Pannell, L. Wigoder, L.
Henderson, L. Peddie, L. Winterbottom, L. [Teller.]
Henley, L.

Lord SHEPHERD moved Amendment No. 126: Page 141, line 15, leave out from ("conditions") to ("of") in line 16.

The noble Lord said: In moving this Amendment, with permission I shall speak to Amendment No. 127. It has always been the Government's intention that claims based on the general level of terms and conditions should not succeed if there is a relevant agreement laying down minimum terms and conditions, as in the case of the engineering industry, for example. During the Committee stage in the Commons the Government accepted an Opposition Amendment which was thought to clarify this point. We have, however, been told that this Amendment, by inserting the phrase "where appropriate" in line 15, makes the position less rather than more clear. These Amendments, we hope, will make the position absolutely clear. I beg to move.

The Earl of GOWRIE

Without going over the arguments, may I point out to the Committee that the Government's Amendment in no way affects our previous Amendment. We are happy to acknowledge it.

On Question, Amendment agreed to.


I beg to move Amendment No. 127.

Amendment moved— Page 141, line 34, at end insert ("and for the purposes of sub-paragraph (a) above the reference to terms and conditions, in a case where minimum terms and conditions have been settled as mentioned in that paragraph, is a reference to those minimum terms and conditions.").—(Lord Shepherd.)

On Question, Amendment agreed to.

6.32 p.m.

Lord SHEPHERD moved Amendment No. 128:

Page 142, line 2, leave out from beginning to first ("shall") in line 11 and insert (", where, or so far as, the claim is founded upon recognised terms and conditions, by an employers' association or an independent trade union being one of the parties mentioned in paragraph 2(a) above. 4A.—(1) A claim may be reported under paragraph 1 above, where, or so far as, the claim is founded upon general level of terms and conditions, by—

  1. (a) an employers' association having members engaged in the trade, industry or section, in the district to which the claim relates; or
  2. 534
  3. (b) subject to sub-paragraph (2) below, a trade union of which any worker concerned is a member.
(2) Where any such worker is of a description in respect of which an employer recognises one or more independent trade unions, such a claim may be reported by a trade union only if it is that recognised union or, as the case may be, one of those recognised unions. 4B. A claim under paragraph 1 above").

The noble Lord said: I beg to move this Amendment. Having considered the present form of Schedule 10, the Government feel that the present wording might have the undesirable effect of promoting inter-union differences, particularly in situations where unions are trying to become established. The present wording allows any union with members in the same district and in the same trade or industry, to make a claim against an employer based on the general level of terms and conditions. The union need not have any members in the group on whose behalf the claim is being made; indeed, the union need not have any members in the firm or establishment in question. The workers on whose behalf the claim is made could all be members of another independent trade union which was recognised by the employer.

This is not a situation likely to promote industrial harmony. On reflection, we think it reasonable to require that a union making a claim based on the general level of terms and conditions should have a member or members among the workers concerned. As well as avoiding inter-union conflict, this may also act as a spur to recruitment in areas where unions are not yet established. For if a union can recruit a small number of members among a particular group and then prosecute on their behalf a successful claim based on the general level of terms and conditions, this should stimulate unionisation among the workers who had not until then joined the union. I hope that this Amendment will commend itself to the Committee.

The Government have recognised that there is a danger in a situation where a union is weak—as they often are where pay is low in just the kind of situation that Schedule 11 is designed to help—that an employer might seek to invalidate a claim by dismissing any union members between the date when the claim is made and the hearing before the Central Arbitration Committee. That is why we have provided that a union must have a member or members among the group to whom the claim relates on the date the claim is made. I beg to move.

The Earl of GOWRIE

I do not know whether the noble Lord's Amendment will, in his ringing words, stimulate unionisation but if it does we are very happy to accept it.

On Question, Amendment agreed to.

Schedule 11, as amended, agreed to.


I spoke to Amendment No. 129 with Amendment No. 95. I beg to move.

Amendment moved—

After Schedule 11, insert the following new Schedule:

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