HL Deb 20 May 1980 vol 409 cc735-64

3.4 p.m.


My Lords, for more than a decade we have been talking about changes to our industrial relations system. First, there was In Place of Strife and the Labour Government's abortive plans for trade union reform in 1969. Then there was the Industrial Relations Act 1971, which in my view suffered more from bad luck than bad design. Then, more recently, there was the last Government's legislation of 1974, 1975 and 1976. No one can say that this is a record of legislative consistency of which Parliament as a whole can be very proud. Despite all the effort expended, we as a country still have not got the legal framework for industrial relations right, workable or able to withstand the assaults of different pressure groups and different Administrations.

The Bill before the House is modest in that it does not attempt to create a whole new legal framework for industrial relations. It concentrates rather on areas where specific abuses have occurred and where there is clear public support for changes in the law. It is ambitious, however— very ambitious— in that our objective is nothing less than to bring much needed stability to industrial relations law, play up the practical and play down the political effects. As Professor Higgins said of Eliza Doolittle in "My Fair Lady", "By Jove, she's got it!" I believe that the measures before us are workable, will stick, and that in this limited but crucial area at least "we've got it".

Although laws based on people's immunity from actions in the courts are inevitably complex, and although references to previous legislation always make the going a bit heavy, the principles underlying the Bill before the House are simple and straightforward. So are the mechanics of the Bill; that is to say, what it is actually designed to do and where it is actually aimed to go. We are committed and we are determined to redress the imbalance, caused largely by the last Government's employment legislation, in respect of the balance of power between organised labour and employers, and in respect also of the balance between the rights of individuals as individuals and the rights of individuals to act collectively. Underlying this commitment is a simple and I would say a rather frightening phenomenon. It is that, while British workers' organisations enjoy greater powers and immunities than their counterparts in the industrialised democracies, British workers themselves are considerably worse off.

In line with this general approach, the Bill is designed to deal with specific union abuses and bad practices, such as picketing at a place where you do not work, and the wider troubles of secondary or sympathetic action, such as blacking the goods and services of an employer remote from the employer with whom you are in dispute and who is himself in no position to settle any problems or difficulties which exist between you and your own employer. Then there are the abuses and bad practices connected with the closed shop— and I shall deal with the general question of the closed shop in a few moments— and the urgent need to protect individuals who suffer from these.

The specific measures in the Bill, as I have said, are designed to be effective against specific and manifest abuses. I use the rather old-fashioned term "manifest" deliberately. We are concerned in this Bill with abuses which are seen to be such by people who never have supported, and probably never will support, the Conservative party— and I mean to include here people who are giving or have given, indeed, their whole careers to the Labour movement or the Labour party. Parliament is a pretty intimate place, and so is the high command of industry— and I mean here both sides of industry. It is no secret and no indiscretion to say that this Bill has received some considerable tacit as well as overt support. I, for one, would be very surprised if, when the Bill becomes an Act, its repeal forms part of the next Labour manifesto. By whatever means you choose to measure public support, this Bill has it. The criticism which the Bill has to meet, and which I shall try to meet, is that it does not go far enough; that public opinion, both within and without the trade union movement, is said to be in some way ahead of the pragmatic reforms of the Bill, and that the climate is now right for much more comprehensive legislation.

Our concern has been to deal with the specific abuses and bad practices, and to do so not theoretically but effectively. We have consulted every step, every clause, of the way; as, before last year's general election, we promised that we would do. The TUC has no credible complaint on this score. That is why your Lordships are considering this Bill this summer rather than last autumn; we wanted labour legislation that was workable, and we wanted labour legislation that would stick.

At the Second Reading of the last Government's Trade Union and Labour Relations Bill six years ago, I said from the Dispatch Box opposite that although we did not like the Bill and were sorry to see the comprehensive and sensible— though, I acknowledge, bitterly controversial— Industrial Relations Act fall, we felt nevertheless that by accepting only a few amendments the Labour Government had an immense chance to do good to the country by taking industrial relations law out of party political dispute for a generation. That would have been worth many jobs and much prosperity. But it did not happen. Indeed, after the General Election of 1976, the Government extended trade union immunity from action in the courts in such a way as to give unions privileges grossly in excess of their special needs. And I acknowledge the needs were special. By contrast, in seeking to tackle the problems of industrial relations, we are determined not to create more problems than we solve. We are starting with the kind of industrial society that we have and the kind of industrial situation that we have— unsatisfactory in many ways though both may be.

We are determined not to undermine existing, responsible management and existing, responsible union leadership and so create more disruption and unrest rather than less. These considerations have always been the core of the thinking of my right honourable friend the Employment Secretary and he has given six years' hard slog to the subject. They are reflected in the whole character of the Bill, which does not set out to impose rigid blue-prints from on high but which seeks to establish satisfactory general rules which can be built on by all concerned throughout industry.

This emphasis on satisfactory ground rules shows that we are in agreement with the party opposite and the labour movement generally, on the importance of voluntary guidance. We recognise the need to work from within the present basically voluntary system and to work with the grain of the system rather than against it.

But, my Lords, voluntarism is not enough. It is not enough to identify a right unless you can go on to provide an enforceable remedy if that right is infringed. Without an underpinning of legal protection, voluntary guidance can easily be made ineffective by a militant minority who simply do not care what damage they do or whom they hurt or what, in this television age, the effect on public opinion may be. The winter of 1979— and we have had instances since then— show how easy it is to ride rough- shod over voluntary guidance, even though it had the full backing of the TUC, when those concerned are indifferent to the effects of their actions on the rest of the community, or on their fellow workers or to the reputation of the trade union movement itself. We believe that as long as the law condones and protects abuses of industrial power, it is futile to look for improvements in industrial relations by voluntary means alone. That, perhaps, is where we part company with the noble Lord, Lord McCarthy, and with the work of the noble Lord, Lord Wedderburn— and both of these noble Lords are probably the most-informed and most expert thinkers in this whole field in the country at present— but it is not, in my view, where we part company from the official Opposition in another place as evidenced by its somewhat less than whole-hearted opposition towards this Bill. Watching Mr. Varley, that very able man, in action was like watching a terrier being made to play with a ball when there were real rabbits elsewhere. A large majority of trade unionists believe the proposals contained in the Bill are right and necessary; and the Opposition know it.

It makes for dull and, more important, often confusing Second Reading speeches if one goes through Bills clause by clause. May I suggest that the most practical way of coming to grips with the Bill is to think of it as a series of five parcels, each containing a number of relevant clauses. There is the "enabling powers parcel" (Clauses 1 and 2). The substantive issues here are the provision of funds for union ballots and the code-making powers for the Secretary of State in respect, principally, of the closed shop and picketing.

There is the "closed shop parcel" (Clauses 3, 4, 6, 9 and 14). The substantive issues here are unreasonable exclusion and expulsion from a union; dismissal in a closed shop situation; protection for employees where action short of dismissal is taken against them to compel them to join a trade union; and the ability of an employer to bring in a union as a party to unfair dismissal proceedings so that the union may bear its fair share of the compensation which the employer is obliged to pay. Then there is the "individual rights parcel", a broad grouping covering unfair dismissal, rights of return to work following maternity, including the new right to time off for pre-natal care and guarantee payments. There is the "secondary action parcel", covering picketing and secondary action generally. Phrases like "secondary action" in my view are confusing and I find expressions like "blacking" or "sympathetic striking" while technically imprecise in legal terms, rather more helpful as a general guide here. Clause 16 is the clause of the Bill which, noble Lords will remember, had to wait for the Court of Appeal judgment and its being over-ruled in the Judicial Committee of your Lordships' House in the case of Express Newspapers v. McShane. Clause 17 seeks to prevent any recurrence of SLADE's practice of recruiting by blacking, as was documented in the Leggatt Report.

Lastly, there is a "miscellaneous parcel" of repeals of previous legislation: in particular, relating to the press charter, to statutory as against voluntary recognition procedures by ACAS; and there is also the repeal of Schedule 11 to the Employment Protection Act which was intended to deal with low pay. Schedule II is inconsistent with our view that individual firms should be free to negotiate the terms and conditions of their own workforce in the light of their individual circumstances, and so we are repealing it.

My instinct is that the substance of the debate this afternoon will derive from the issues of secret ballots, the closed shop, the whole area of immunity for secondary action including picketing, and those modifications to employment protection legislation which I have labelled the "individual rights parcel". I hope therefore that the House will understand if I spend the time remaining to me on these issues, which do, after all, constitute the red meat of the Bill. I shall, of course, try to deal in detail with any other matters raised as well when I come to wind up, if given leave, at the end of the debate.

The provision of public funds for secret postal ballots has been widely welcomed as following best existing practice of many trade unions and as part of our overall aim of encouraging greater participation by rank-and-file members of unions whose views, I think, as recent industrial disputes and the response to the embarrassing "Day of Action" have shown, are often neglected by their representatives.

This substantial new encouragement to union postal ballots in no way reflects adversely on the value of workplace ballots. Indeed, the Government intend to put down an amendment to give immediate encouragement to such ballots by placing an obligation on an employer to provide on the request of the trade union a place on the premises where the union can hold a secret ballot on any of the purposes set out in Clause 1 (3) of the Bill. This idea has been put forward by the CBI and pursued with his customary vigour by the noble Lord, Lord Robens, who has immense experience in this area. I am most grateful to the noble Lord for help on this matter and I believe that the amendment which will result will add greatly to the value of the Bill.

We have, however, been criticised for not providing for compulsory ballots. There are two major reasons for our not having done so. In the first place, we want the pressure for greater union democracy to continue to work upwards from the shop floor and not be obscured and inevitably politicised by Government pressure. That again lies very much at the heart of my right honourable friend's approach, and I would have thought that all recent signs were that things were turning his way.

In the second place, ballots inevitably involve procedural matters and delay. A strike ballot held at the wrong time due to an inflexible statutory provision could strengthen and prolong a strike against the wishes of both the union and the employer. It would assist militants who want to see an early strike, at a time of maximum solidarity of feeling, as against moderate leaders who might still have hopes of a reasonable settlement being reached. This would not help sensible employers, either. Nor do proposals on compulsory secret ballots deal satisfactorily with the problem of unofficial strikes— the most prevalent form of industrial action in Britain. Indeed, their effects might well be to increase unofficial action. If you try to put a penalty on official action which you do not put on unofficial action, the odds are that this must encourage more unofficial action.

But we do recognise the strength of feeling behind other proposals in this area; notably, that a trade union which proceeded with a strike without a ballot in favour would lose its immunity against action in tort. Such matters will be taken up, together with the whole question of trade union immunities in the Green Paper on immunity which we intend publishing later this year.

As with compulsion for secret ballots, the Government must face industrial realities on the matter of the closed shop. No responsible Government can ignore the fact that over 5 million people are covered by closed shop agreements, often of long-standing and often valued by practical employers. And no responsible Government can ignore the clear lessons of experience. We are convinced that making the operation of the closed shop unlawful would fail to achieve our central objective, which is the protection of individual rights. It would only drive the practice underground and would deny individuals the very protection that the Bill is designed to give them. That is what did happen in 1971 and that is what we are determined shall not happen now.

We dislike the closed shop intensely for all the obvious libertarian reasons. But if we are to recognise the realities of industrial life, we have to adopt the approach of the Bill and create effective safeguards against abuse of the closed shop. The Bill therefore greatly extends the protections of individuals in the closed shop. It is designed to protect existing non-union employees in both new and existing closed shops; to give new rights to those with deeply-held personal conviction against joining any union whatsoever or a particular union; to secure— by depriving employers of their protection against unfair dismissal claims in appropriate cases— that new closed shops are only established with the overwhelming support of employees concerned— 80 per cent.— voting in a secret ballot; and to provide a new remedy for those who may be unreasonably expelled or excluded from their union in the circumstances of the closed shop. In addition, the Secretary of State has indicated that he intends to issue a code of good practice on the closed shop under the powers Clause 2 will give him. This, together with the other provisions of the Bill, amounts to a substantial range of new protections.

I should like briefly at this point to refer to the proceedings concerning the three ex-British Rail employees currently before the European Commission on Human Rights. Most regrettably, the Government's position on these cases has been grossly misrepresented by some Press comment— most recently by the Daily Express last Friday— where the piece was ill-informed or mischievious or both. I must say that I expected rather better of Mr. James McMillan (who wrote the piece) as he is a great authority on the "Gowrie conspiracy".

It was the previous Administration whose legislation caused the applicants to need to go to the European Commission in pursuit of a remedy. The Employment Bill, I am glad to say, provides a domestic remedy for just their type of case; indeed, we had their unfortunate experience in mind when we formulated these proposals. The Government have made clear to the Commission its very different stance from that of the previous Government and the Commission in its communiqué on the final hearing of the case has acknowledged this.

The whole thrust of the article's criticism that we were in some way defending the closed shop to the European Commission is wrong. What we were doing was drawing the Commission's attention to the provisions of this Bill and the protections for individuals in it. We are wholly satisfied now that when this Bill becomes law we shall be meeting the standards of the convention.

Let me come now quickly to the nub of the Bill: picketing and secondary or sympathetic action. Our industrial relations system is rooted in history, evolving over 100 years or more, and continuing to adapt and change to meet the pressures and problems of modern industrial society. It has grown up in ways which have involved the minimum of legal interference and regulations. We do not in this country have any tradition of legally enforceable agreements, and there is no provision for compulsory arbitration. Managements and unions do not habitually use the courts to sort out their problems; indeed, they have preferred to make use of voluntary methods.

One aspect of this voluntary system is that our trade unions do not exist as a result of legal rights, but on the basis of legal immunities from action in courts. Nowhere will you find in statute a right for trade unions to organise or to prosecute their case through industrial action; indeed, there is no legal right to strike as such at all. The unions have developed on the basis of the desire of workers to be represented collectively so that they can bargain with their employer on more equal terms. The role of the law has been to ensure that the unions can do this effectively without laying themselves open to action in the courts. It does so by providing those who call strikes, and other forms of industrial action in contemplation or furtherance of a trade dispute, with immunity from civil proceedings for inducing breaches of contract.

Many people have questioned whether an industrial relations system based on legal immunities rather than legal rights is the best of all possible systems for the present industrial world. Let us say that the matter is at least open to question, and that is why we shall, as I said earlier, issue a Green Paper on immunity later this year.

What is not open to question is that the law currently in force has drawn the concept of immunity intolerably wide. Your Lordships' Judicial Committee in the case of Express Newspapers v McShane in December last year made it clear that under the Trade Union and Labour Relations Acts of 1974 and 1976 the test of whether an action is in furtherance of a trade dispute is fundamentally a subjective one. If the person calling the industrial action establishes that he honestly believes that it will in some way further an imminent or existing trade dispute, that is enough to give him immunity— the modern equivalent of reaching the church door in the Middle Ages. Indeed, the more I have had to immerse myself in trade union law, the more I have a sense of dé jà vu with essays on 14th century ecclesiastical organisations which I had to write at university 20 years ago.

So long as the person calling the industrial action is found to be sincere, therefore, it does not matter how remote the industrial action is from the original dispute or how much it involves people— both employees and employers— who have no means whatsoever, however well intentioned they may be, of influencing the outcome of the dispute. It does not even matter if the principal motive for calling the action has nothing whatsoever to do with the original dispute as long as the person who calls it believes that it will further the dispute in some way, however slight. So the law as it stands is a licence to spread industrial action far and wide beyond the original dispute, putting at risk the jobs and businesses of people who had nothing whatsoever to do with it. No responsible Government could have put the law into that state. No responsible Government could allow the law to stay in that state.

Without doubt the most damaging form of secondary action is secondary picketing. As the then Prime Minister, Mr. Callaghan, told Parliament on 18th January 1979 during the road haulage dispute— and I am quoting the right honourable gentleman: the movement of supplies of all kinds is being held up. Hardship and considerable dislocation is being caused to the general public and to industry particularly because of the severe effects of secondary picketing ".— [Official -Report, Commons, 18/1/79, col. 1957.] Or as Mr. Rees, the then Home Secretary, said on the same day: picketing is not being confined to drivers and vehicles in the hire and reward section of the industry and it is interfering with the movement of essential supplies and services … There is no doubt that secondary picketing … is the major cause of our problems ".— [Official Report, Commons, 18/1/79, cols. 1984–85.] My Lords, the effect of Clause 15 of this Bill is quite simply this. In future if you want, by picketing, to persuade people to break contracts you will lose the immunity the law currently provides if that picketing takes place anywhere other than at your own place of work. The clause contains specific provisions for exceptional limited cases: the position of dismissed employees, trade union officials and those who work at more than one place or for whom it is impractical to picket at their own place of work. But when the Bill becomes law the immunity for the rotating or flying picket will be over. In future, the employer who finds his business and incidentally the jobs of his employees— threatened by pickets from outside will be able to seek a High Court injunction for the picketing to stop and sue for damages if he so wishes. He will be able if necessary to proceed against the organisers of the secondary picketing, up to the leader of any union concerned.

My Lords, some misunderstanding has arisen about the role of the police when our picketing proposals become law, and I should like to take this opportunity to clarify the effect of the Bill. It is important to understand that it creates no new criminal offences, nor does it extend or alter the role of the police in any way. The police already have a duty to deal with obstruction and breaches of the peace on the picket line. It is not lawful to obstruct and it is not lawful to cause a breach of the peace. The Bill does not change this. Again, the police have powers to control the number of pickets and the Bill does nothing to change that. What the Bill does is to allow employers to take civil proceedings if their business is damaged by secondary pickets and if they wish to do so. Normally this will involve seeking a court injunction to restrain the secondary picketing to see that the thing stops. The provisions are drawn widely enough to cover the organisers. Thus they work against flying and rotating pickets. The Bill also empowers the Secretary of State to issue a code of best practice, and this will help the police.

The principle underlying Clause 16 is that sympathetic action is justifiable only to the extent that it is used to put direct pressure on the employer in a particular dispute to settle that particular dispute. We have retained immunity for industrial action directed against an employer's customer or supplier while the particular dispute is taking place. The reason we have done so is that we would otherwise be cutting into the quick of long established legitimate union activity, whereas we are concerned with the discouragement of irresponsible union activity. The Court of Appeal judgments widely associated with the name of Lord Denning attempted to derive from the wording of the statutes a commonsense and workable doctrine of remoteness where legitimate industrial action was concerned. The Bill gives formal expression to this sensible and acceptable idea. My Lords, the case of McShane demanded an immediate legislative response and this is therefore it.


My Lords, I am so sorry to interrupt the noble Lord but this is relevant to Clause 15 and is important in the eyes of some of us. May I ask whether consultation in depth took place between the police on the official situation of their position in regard to Clause 15? Secondly, were these provocations dealt with by the police at all? Many of them believe that the existing situation is good enough, and quite enough to prevent what I would call provocative action that might damage the public property.

The Earl of GOWRIE

My Lords, the noble Lord, Lord Davies of Leek, must distinguish between the withdrawal of immunity from civil proceedings by an employer against a secondary picket and the general issues of demonstrations which are covered by criminal law at the moment, where we did, of course, consult the police, and where we shall consult them again in respect of the code of practice.

As I indicated earlier, several clauses in the Bill seek to reduce the burden which the last Government's employment protection legislation imposed on employers, particularly small employers. I would remind the House here that it was not just ourselves, then in Opposition, who expressed concern that the Employment Protection Act did not turn into the "Employment Destruction Act". It was the noble Lord, Lord Lever, then Chancellor of the Duchy in another place, who used those words. Our aim is to allay the noble Lord's fears, and those of small employers everywhere at a time when we need every job we can get. Our amendments deal with questions of unfair dismissal, the method of calculating entitlement to guarantee pay and maternity leave and reinstatement.

My Lords, on this last issue, I hope there will be no flurry of excitement in which some horrifying conclusion is reached that the Government are hostile to the rights of women. Quite apart from any issues of principle, or even vulgar electoral considerations, the Government have a huge economic interest in women's employment. I spend a lot of my time, as the Minister responsible in this area, urging girls at school to take up elementary maths and science to enable them to enter the new electronics industries. But the protections which now exist weight to a damaging degree against the very small business, and have in our judgment created a poor psychological atmosphere for recruitment by small business. Our modest amendments aim to correct this.

In concluding, I do not want to suggest that the law if the only aspect of industrial relations or even the most important aspect. There are the problems which arise from the lack of any proper system of communication between management and employees. We do not plan to impose a constricting legislative framework of participation on industry and commerce. But, we do want to give every encouragement for it to develop sector by sector; and we shall continue to look at ways to encourage workers to take more of a financial stake and interest in their companies. Nevertheless, we cannot escape from the strong feeling among the British people, and one widely shared by all our competitors abroad, that undisciplined industrial relations have hindered our economic progress in recent years. This view is widespread and restricted to no particular political party; it is also held by a large majority of members of unions. Hence this Bill and the consultations that lead to it. It is only common sense and existing best practice in action.

My Lords, while there are significant differences in approach between the Government and the leaders of organised labour over industrial and economic policies our objectives are the same as theirs. We both want a stronger economy and one where prosperity is less regionally imbalanced. We both want a standard of living for the British people which, while it reflects our own habits and tastes as other nations reflect theirs, comes a bit closer to the standards of our neighbours and competitors. I repeat what I said earlier: while British workers' organisations enjoy great powers and immunities, British workers themselves are worse off than their counterparts abroad. We both want higher rates of real employment. We both want to use our truly formidable energy position— and I am thinking of course of coal and natural gas as well as of oil— to help restructure our industrial capacity. We want the same things.

We have no quarrel therefore with the labour movement. We know that the work of the movement is critical if there is to be sufficient economic recovery, particularly in industry, to ensure a better life for its individual members and a less shabby environment for them to live and work in. There is no innate reason why these common aims should not be achieved by the efforts of British industry within the next few years. But in the short term the going will be tough and unpleasant, for the Government and everyone else. The reason is that we have not yet had a pay round in the public sector, where the Government are directly responsible and where it is incumbent on us to set an example free from the doctrines of comparability which the previous Government initiated or from the settlements which they postponed. We are on our own now and the barometer is falling.

My Lords, we have no illusions as to the magnitude and sensitivity of our task. We are convinced that we have the human and national capacity to undertake it. In a world shaken and made very volatile by recession, we are aided by the immense stability of our political traditions and institutions— among which I include, of course, the great labour organisations. It is because I believe that this Bill makes for greater stability in industrial relations affairs, by bringing them in line with what the vast majority of people think and feel and expect, that I commend the Bill to the House. My Lords, I beg to move that it be read a second time.

Moved, That the Bill be now read 2a.— (The Earl of Gowrie.)

3.40 p.m.


My Lords, I should like to begin by saying something nice about the noble Earl, Lord Gowrie, because he said something very nice about me, although I would exchange the nice things he said about me if he would take my advice a little more. Our advice is that this is not a good Bill, although I admit that the noble Earl has made out a good case for it. We believe— and it falls to me to say why— that this is an irrelevant and dangerous Bill, which makes an unfair attack, at least in its present form, upon both workers and their trade unions. I must say to your Lordships that if the House accepts the amendments we intend to put forward this Bill will end its days in quite a reasonable form; but in its present form it remains an irrelevant and dangerous Bill, which will do nothing to deal with any of the major economic and social problems facing this country.

I should like to mount the argument from this side of the House under three heads. This Bill defies the lessons of experience; this Bill ignores the realities of union leadership and union government; this Bill mistakes the causes and the roots of industrial conflict in contemporary Britain.

It is now nine years, on 5th April 1971, since the noble Lord, Lord Drumalbyn, moved the Second Reading of the Industrial Relations Bill in this House. He said that that Bill was wholly constructive in its aims and was designed to preserve all that was best in industrial relations. He said it was intended to strengthen and secure the position of trade unions, to discourage unconstitutional action and to provide a framework of justice and fair dealing. He concluded by saying: We have had to wait a long time for this Bill but it was worth waiting for ". It was quite in vain for the late and much lamented Lord Delacourt-Smith, in what was almost the last speech he made in this House, to point out from the wealth of his experience that the Bill would not do any of the things it set out to do; that instead it would increase the volume and pace of industrial unrest in this country.

The noble Lord who introduced the Bill said at the end of the debate in answer to Lord Delacourt-Smith: It is a good Bill. We shall make of it a still better Act— an Act of which the British people will say ' We have had to wait a long time for this, but it was worth waiting for ' ". The noble and learned Lord, Lord Hailsham, actually commended the Bill to the House and silenced the doubters in verse. He said: Be of good cheer, ye fearful saints: The Bill ye so much dread Is big with mercy and will break In blessings on your head ". It certainly broke upon our heads, my Lords. As a result of that Bill, all kinds of untoward things occurred. We now know that all collective agreements began with what was called in those days a TINALEA clause— "nothing in this agreement is intended to give rise to legal obligations". That was the first farce.

Then we had the farce of the compulsory ballot, used so disastrously only once; resulting in a more inflationary settlement in British Rail. Then we had the ludicrous spectacle of the Official Solicitor engineering the release of the Pentonville Five. Meanwhile, each year working days lost rose in number. There were 11 million in 1971, 24 million in 1972 and in the average life of that Government 17 million working days lost a year, virtually all of them in unofficial, unconstitutional and unlawful strikes as a result of the Industrial Relations Act. Indeed, the Government themselves were destroyed by an unlawful strike by an unregistered union, in defiance of their statutory incomes policy. Never at any time did anyone dare to suggest that legal action might have been helpful against the National Union of Mine- workers in that strike. Yet we have a similar kind of Bill being put before us this afternoon.

There have been studies of the operation of that Act. It is extremely important that noble Lords should stay awake during this debate because I intend to read out what the authors of Industrial Relations and the Limits of the Law (a survey by Warwick University) said were the lessons of the 1971 Act. They said: Our general survey of employers and unions confirmed the impression that the new law on industrial action had relatively little impact on the general conduct of industrial relations. Employers felt that the experience of the Act showed either that it did not solve disputes or that it made them more intractable by making workers or unions more intransigent…. Indeed, the Act came to be seen as an increasing embarrassment to a Government seeking some accommodation with the unions on national incomes policy. This and its relative failure encouraged the Conservative Government to accept the need for a substantial amendment to the Act even before their defeat in the General Election of February 1974 ". Indeed in the debate in 1974 on the Trade Union and Labour Relations Act, the noble Earl, Lord Gowrie— I believe he has already quoted from one part of that speech— made a similar point. He said this: The single most penetrating remark that I have read about the Industrial Relations Act was made when it was still in Bill form, and it came from the then Mr. Douglas Houghton … He said: 'This Bill reads like a guide to good order and discipline in a grammar school. It was drafted in the solitude of the Inner Temple and many of the provisions will not stand the mighty roars of disapproval from mass meetings' ". The noble Lord, Lord Gowrie, concluded in this way: May I say to the noble Lord how wise I believe those words to be. My own political motto, for what it is worth, is borrowed from a road sign in current use and is: 'Do not enter box unless your exit is clear'. Perhaps we neglected that principle ". Our argument today is that they are putting us back into the box. How can it come about, so shortly after the experience of the 1971 Industrial Relations Act, that we are putting ourselves back into this box and that we are giving ourselves, as the noble Earl said this afternoon, five exploding parcels? Why are we doing that? I know it will be said that this is not the 1971 Industrial Relations Act. It has been said: but that does not help the Government's case. This Bill is certainly more one-sided than the 1971 Industrial Relations Act. That is one difference. The 1971 Act contained provisions for unfair dismissal; it gave protection for registered unions in respect of commercial contract breach. The 1971 Act did something about trade union recognition, and certainly disclosure of information provisions. In contrast, this Bill is negative on all these matters. This Bill gives small firms the right to dismiss unfairly and my only answer to the point which was made so repeatedly about the noble Lord, Lord Lever, is that perhaps he spoke without the benefit of all those surveys which were commissioned by the last Government, delivered to this Government and published in the Department of Employment Gazette, which show that all the things people say about small firms not taking on people because of the unfair dismissal provisions are all nonsense. That is the only excuse I can find for him.

This Bill also narrows the fairness criteria in unfair dismissals; it abolishes the basic award; it reverses the onus of proof and it extends and complicates the whole process of maternity notice requirements. It is true that there are two other differences between this Bill and the 1971 Act, and in a very small way they do help the Government. There are no threats here to make contracts legally enforceable and there are no direct replications of the monstrous Sections 96, 97 and 98, which sought to make unions responsible for the authorised acts of their agents. But, at least, with the 1971 Act, we were told that it was the end of the line. We were told that there were to be no further legislative proposals. But today— and, of course, in another place repeatedly— we hear from Government spokesmen that this is not the end of the line; that they are going to produce more consultative documents where the TUC's advice will again be ignored and, presumably, more Bills which will deal with things such as legal enforceability and making unions responsible for the authorised acts of their agents.

Also, in the two most crucial areas of the Bill, the closed shop and the right to use industrial action, we would argue, and we shall be arguing in detail at the Committee stage that this Bill is worse, more dangerous and more irrelevant than the 1971 Industrial Relations Act. The best way to point this out, is to take up the point which the noble Earl made when he talked about providing a set of legal ground rules. These are not ground rules. This is a ground maze. This is a ground mist, which the Government are now going to see settle over industrial relations in these two crucial areas. When these parcels are exploded, the air will be filled with the vagueness and ambiguity of the law as it relates to them.

Let me go through them. In the closed shop, for example, the aim of this Bill— certainly, the result of this Bill— is to make existing union membership agreements unenforceable and future union membership agreements unobtainable. This will be done, by important disputable, and ambiguous notions, such as areas of exclusion for existing members, for those with deeply held personal convictions, for objectors to particular unions and the need to obtain from those affected 80 per cent. votes in favour, of new UMAs.

All these terms are likely to be extremely difficult to define and extremely difficult to apply. They will lead to a series of cases. Until such cases clarify the law, if and when they do, nobody will be able to say what are the legal boundaries of the lawful UMA. That is the effect of this Bill on closed shop law. For myself, I should prefer what was in the 1971 Act. At least, in the 1971 Act registered unions had the option of the agency shop and the qualified closed shop. Both were fairly clearly spelt out. But in this Bill there are a series of ambiguous, disputable notions which will need to be worked out after a great deal of case law.

The same could be said of picketing provisions. There is no definition in this Bill of "a place of work". The only way to find out, I suppose, will be to go to law and see. The Bill is also extremely ambiguous on what are the rights of trade union officials and representatives, and on how their right to move around the picket line relates to their position in the union rule book. Here again there will be a field day for lawyers.

Then as regards secondary action limitations, these depend on establishing a whole series of equal disputable, ambiguous notions. The "principal purpose" must be found. It must "directly prevent the dispute"; it must be a dispute involving a "supplier to an employer who is a party to the dispute" and, most difficult of all, in the opinion of the judiciary, the acts complained of have to be "likely to achieve their purpose".

I suggest to the House that if this principle had been in existence in 1940, the International Court at The Hague would have declared Hitler the winner. The fact is that you cannot prove what these notions mean without going to law. Then you are likely to get different answers, and until you have traced your way to the Judicial Committee of this Chamber you will not be certain.

But it is when we reach into the area of primary action that we find the single most unsatisfactory part of this Bill. Here is something which I really beg noble Lords opposite to take on board. We shall submit that this part of the Bill severely affects primary action, possibly by giving rise to various forms of tortious liability and, centrally and most clearly, by what the Bill does in Clause 16 (8), which sets out to repeal subsection (3) of Section 13 of the 1974 Trade Union and Labour Relations Act. We maintain, and we shall argue in more detail later tonight, that this seriously undermines the right of primary legal action.

Yet the Government have managed to suggest that these qualifications, which they introduce into primary and secondary industrial action, can be justified because of a historical fiction, because it is being argued, and was argued from the Dispatch Box this afternoon, that all we really need is to go back to the ambit of protection which the trade unions had in 1906, as it was seen in 1906, so that all that has happened since 1906 is that in 1974 and 1976 the Labour Government vastly extended the areas of protection of immunity, in defiance of the clear intentions of the framers of the 1906 Act.

Nothing could be further from the truth. The fact is that there have been a whole series of judicial decisions since 1906 which we shall spell out this afternoon. As a result of that series of judicial decisions, the wording of Section 13 of the Trade Union and Labour Relations Act was necessary, in order to protect primary industrial action; and the single most important part of that protection is undermined by Clause 16 (8), which repeals subsection (3) of Section 13 of the 1974 Act. Therefore, if the Government do this, they are, in effect, making it impossible for trade unions to carry out their normal business by the use or threat of primary industrial action. If the Government cannot see that at the end of this debate, then I am afraid there is no hope for them.

So I should like to turn to my second argument against this Bill, which is that it is not simply against the lessons of history. It is against the realities of trade union leadership. If those of your Lordships who will agree with me as far as I have gone, and even if those who do not, will give me half my case, I would ask you to think of the position which faces the moderate trade union leader at national level, at local level or on the shop floor itself, faced with the immunities left to him as a result of this Bill. The Government presumably believe that he should read the Bill when it becomes an Act, and take it all in one go, anticipate exactly what the Court of Appeal will make of all the provisions and go out and tell his members. If his members ever go outside that extremely clear ground rule, says the noble Earl, then he should expel them or discipline them in some way.

I suggest that it is impossible for any leader to know what are the legal boundaries, and there is nothing that he can tell his members, except that things have become very misty. If, at a subsequent stage, somebody brings an action— and under this Bill it need not be an employer involved in the dispute; it could be any crackbrained third party who thinks that he has been affected in some way— that person can seek an interlocutory injunction. Then, presumably, the noble Earl believes that the moment that our trade union official learns of the threat of the interlocutory injunction, he should rush to the members and tell them to stop. But, of course, we all know that interlocutory injunctions are not always granted, and even when they are granted, as we saw as recently as a week or so ago, those involved think better of it before they put them to the test.

So what should the union leader do? Should he wait until some action comes to court and then tell his members?

I suggest that the effect of this Bill is to make the position of an ordinary trade union leader impossible. It is impossible to see how he is to evade charges of cowardice, charges of incompetence or counter-charges of contempt for the law and running the union into debt. The easiest thing for him to do is not to lead at all, or not to be there when the 'phone rings. That is what you might have to tell your trade union friends: do not be there when the 'phone rings. It may be a lawyer. Then you have got to tell the members what he said. If noble Lords have ever tried to tell trade union members what lawyers said, they will know that they do not believe it; they cannot believe it; they find it unbelievable. But that is the sort of schizophrenia one is leading trade union leaders into by this Bill. Either they will struggle with it, as they struggled with the 1971 Act, with the consequences which we have seen, or they will refuse to lead, or— and I must say I thought that the Government had learned this lesson and that the Secretary of State for Employment in the other place had learned this lesson— leadership in the trade union movement will pass into the hands of men who do not care what the law says and who are willing, and able, and keen to defy the law of this land.

I thought that had sunk in by 1974. I thought that the Secretary of State for Employment in another place saw that personally and knew it well. Yet we have a Bill of this kind which threatens to bring us into a worse situation than any situation which arose from the 1971 Act. We on this side of the House find it inconceivable that people can openly put this country into that box.

That brings me to my last point: the nature and causes of industrial conflict in contemporary Britain. There was a time when the Conservative Inns of Court Association wrote, A Giant's Strength — when the Conservative Party published, A Fair Deal at Work — the Donovan time. There was a time when there was a kind of argument for more legal regulation because this country could be said to be suffering each year from a 25 or 30 per cent. increase in the number of unofficial, unconstitutional strikes. It was argued that the measures of 1971— much the same as these measures— were designed to deal with the unofficial, unconstitutional striker and forced the union leader to discipline this man, otherwise the union's funds would be at risk. Those of us who were associated with the Donovan Commission never believed this story. Our argument always was that what was required were the Donovan reforms: the changing of the nature of procedure agreements, the development of new procedures and the creation of plant and company bargains. I would argue that we were right, not simply because of what happened between 1971 and 1974 but because of what began to happen to the number of strikes in this country in the early 1970s, through the mid 1970s and to this day.

The fact is that in 1970–71 the number of strikes in this country reached the all- time record figure of around 4, 000. After a year or two they began to fall, more or less steadily— I am not making a party point, but particularly after 1975— and last year the number of recorded strikes in this country was running at about 2, 000. The number has been cut in half, so the argument for that kind of legal regulation has gone. We have had the Donovan revolution, and this country does not suffer from any more unofficial, unconstitutional strikes than it was suffering from in the early 1950s. What has replaced the unofficial, unconstitutional strikes are official, mass industrial actions— above all, mass industrial actions in parts of the public sector which in the early 1970s began to resort to industrial action during the period of the Heath Government. That is why we had 17 million working days lost, and that is why the Industrial Relations Act failed to prevent it.

Those are the kinds of confrontation that we have had since 1970— large numbers of working days lost in a few important, strikes, particularly in the public sector. And they were all brought about by the failure of the Government of the day, both Conservative and Labour, to gain some kind of overall consensus for their economic policies; in particular for the impact of their economic policies on pay. It has been the consequences of that failure which have caused the present industrial disputes problem facing this country.

History, both in this country and in other countries, shows that you cannot solve major confrontations of this kind by changing the basis of industrial law. In this country we had periods of this kind from 1910 to 1914, from 1921 to 1924, in 1926 and again from 1970 to 1974. History shows that you solve, or bring to an end if you do not solve, confrontations of this kind in one of two ways. Either you solve them, as in 1921 to 1924 and again in 1926, by prolonged and deepend economic recession which brings the nation to its knees, including the trade unions— and that may be the policy of the Government. But if it is not, then the only other way history shows that this kind of confrontation can be solved is not by law but, as in 1914 for a while, as in 1940 and as in 1974, by a broadened consensus which makes possible a measure of agreement on overall policies, particularly policies relating to pay.

It is true that the Government have said today that next year they are going to do something about pay in the public sector. They have also said that one of their problems about pay in the public sector has been that they inherited the collapse of the last Government's incomes policy. All I am saying is that they did not do much to remedy that matter. Moreover, this Government have had one thing in the public sector all of their own to do, and they have done it. They have honoured in full the report of the special review body on doctor's and dentists' pay recommending 31 per cent. That is the way in which they are beginning the next wage round.

We say that this is not the way to run a country. And we say that this Bill is completely irrelevant to the problems now facing this country. We say that we shall oppose this Bill in its present form because it will become, and will remain, an overwhelming obstacle on the way back to consensus and agreement, which must come in the end.

4.6 p.m.


My Lords, first, I should like from these Benches to thank the noble Earl, Lord Gowrie, for the clear way in which he has explained the principles of this Bill, involving as it does such a complex subject. I recall speaking in the debate nine years ago, to which the noble Lord, Lord McCarthy, has just referred, on behalf of my noble friends when the Industrial Relations Bill of an earlier Conservative Government was introduced into this House. The noble and learned Lord, Lord Donovan, whose renowned Royal Commission had reported three years earlier, spoke immediately after me, and I have found it instructive to read again what it was that Lord Donovan then had to say. I quote from col. 40 of the Official Report of 5th April 1971: But there is one overriding principle to which all legislation of this kind, if it is to be successful, must conform. It must be such as to offer the best hope of co-operation from both sides of industry. Not only does common sense require it, but all our industrial history proclaims it ". Since then, our industrial performance has not improved and the power of trade unions has both grown and shifted more from the centre to the localities. For the British people, I think that this process culminated in the events of the winter before last and left the present Government no alternative but to bring in further legislation to restore the balance of power between employers and trade unions.

The main provisions of this Bill were endorsed by the electorate a year ago. The Secretary of State for Employment has, to his very great credit, consulted widely and at length before introducing it. Its scope is limited, and in its recently revised form we on these Benches give it our broad support.

For a time I had hoped that the so-called concordat between the TUC and the Labour Government, reached in February 1979 and seeking to deal on a voluntary basis with the same matters, would avoid the need for more legislation, but there was no indication that I could see, even before last year's general election, of that agreement actually operating. Nevertheless, speaking on behalf of my noble friends in the debate on the gracious Speech immediately after the present Government took office, I expressed the hope that they would consider the possibility of delaying the implementation of any legislation so that it took effect only if and when the need for it under the new Administration had been demonstrated beyond doubt. Since then, the trade union leaders have not in my view shown that they are able to exercise sufficient control over events to justify further delay. Indeed, the TUC itself positively encouraged action last Wednesday, which certainly was not in contemplation or furtherance of trade disputes but directed rather towards political ends, and in those circumstances, in my view, it is no longer a credible proposition that these matters should be left to trade unions alone to handle on a voluntary basis.

I should like now to comment briefly on the four main elements of the Bill as they were outlined to us by the noble Earl, Lord Gowrie. First, the matter of secret ballots. The TUC guide on the conduct of industrial disputes, issued in February of last year, contained a recommendation that trade onions should provide in their rules for ballots to be held where strikes were contemplated or taking place. For the Government therefore merely to provide in the first clause of this Bill for funds to be made available where requested to meet the costs incurred by unions when conducting secret ballots on certain limited matters, does not seem to me to be a point about which trade unions should get too excited. On the contrary, now that any financial impediment will disappear, I trust that in appropriate cases increasing use will be made of such ballots.

The issue of the closed shop arouses very strong feelings and I do not doubt that they will find expression in today's debate. Liberals naturally dislike the concept because of its intrinsic illiberality, but for my part I have enough practical experience of industry to know that it could not altogether be prohibited as easily as might appear and that the attempt to outlaw it in 1971 simply did not work in practice. If therefore the overriding principle earlier advocated by Lord Donovan for legislation of this kind is to be met, it seems to me reasonable that the Government should in the first instance seek to illiminate the most intolerable impositions of the closed shop, as in the notorious case of British Rail in 1976, to which the noble Earl referred, by making the establishment of new closed shops more difficult and by extending the grounds on which dismissal is to be regarded as unfair.

In discussions on the Labour Government's employment protection legislation we on these Benches laboured hard with the party opposite to extend such grounds beyond religious beliefs to include grounds of conscience. That this is a reasonable word to apply seems to me to be supported by its inclusion in the agreement reached early last year between the TUC and the Labour Government; and I suggest that it is noteworthy also that a majority of the Donovan Commission considered that when a trade union secured a closed shop, employees should have a right of complaint for unfair dismissal on both conscientious and indeed other reasonable grounds. It remains to be seen what practical difficulties may arise in seeking to extend valid objections to union membership to include objecting to being a member of any trade union whatsoever, and of a particular trade union.

Having earlier joined in advocating that people excluded or expelled from a trade union should have a right of appeal to an arbiter independent of trade unions, we on these Benches naturally welcome in principle Clauses 3 and 4 of the Bill. We also strongly support Clause 17 which deals with coercive trade union recruitment practices and is designed to afford protection against the deplorable tactics recently used by SLADE.

The problems of secondary action and of picketing I approach with the deference which is due to noble and learned Lords who sit in this House in a judicial capacity. Indeed, when we reach that part of the Bill in Committee, I hope that my noble friend Lord Wigoder will deal on our behalf with some of the more complex legal problems which arise in it. All I will say now is that it seems to me to be understandable for the Government in the first instance to confine its legislation to limited changes in civil rather than criminal law, and assume that trade union members and officials will continue to respect that law. It is essential that it should be upheld because upon it depend the rights not only of people to withdraw their labour but also of others to work. I very much hope that on these points the Bill will prove effective, and that indeed the further Green Paper on immunities promised for later this year will not need to be followed by still more legislation. Even the provisions contained in this Bill should, in my view, be seen only as a legal long stop, and I trust that as much use as possible will be made of codes of practice such as the one already produced on picketing by that widely respected organisation, the Industrial Society.

We accept that Sections 11 to 16 of the 1975 Employment Protection Act, which obliged the Advisory, Conciliation and Arbitration Service to carry on certain procedures concerned with the recognition of trade unions, are inoperable in their present form. Indeed I understand that they are thought by ACAS itself to conflict with the conciliation and advisory work that it is doing so well. We support the proposal to deal with that part of Schedule 11 to the same Act which enables claims to be made that employers are not applying the general level of terms and conditions observed in the same industry and district by employers in similar circumstances. These provisions appear to have had inflationary effects and they do not seem to have fulfilled the proclaimed purpose of benefiting the low paid. I should make plain, however, that we continue to feel concern for people on low incomes. Many are not members of trade unions, yet under the schedule claims can be made only by unions or relevant employers' associations.

With considerations such as these in mind, I do not think that we on these Benches will be tabling many amendments to the Bill, but there are a few points of principle about which we have reservations. One is that under this legislation less favourable treatment is proposed for companies employing fewer than a certain number of people. For years the Liberal Party has advocated that more needed to be done to encourage the formation and the development of small businesses, including co-operative enterprises, but it is often the employee in a small firm who is more vulnerable and who needs greater protection than others. This point has application to the fairness or unfairness of dismissal, the period within which unfair dismissal complaints may be brought, and to reinstatement after maternity absence.

Although in the light of recent lengthy national disputes I can understand the reasons for including in the Bill Clause 13, which deals with guaranteed payments, its provisions strike me at first sight as retrograde, if only because they appear to have the effect of widening the differences in employment conditions between so- called white collar and blue collar staff, at just the time when everything possible should surely be done to narrow the gap. So much for the provisions of the Bill itself. Taking it as a whole, I do not myself see why it should not prove acceptable, at least to the general body of trade unionists as well as to employers and thus conform to the overriding principle that Lord Donovan considered as essential for legislation of this kind.

Before I sit down, I should like to offer briefly a few more observations from my own experience. This Bill, of course, will not do anything positively to solve our industrial relations problems. These problems must be tackled within industry itself by employers and trade unionists. I take this opportunity to reaffirm my continuing belief in the need for trade unions. In my view, if they did not already exist they would now have to be invented in order to keep management up to its job. But they are with us anyway, and our industrial performance can only be improved with their co-operation. In the aftermath of last week's damaging day of action, I believe it is more than ever vital to secure that co-operation.

As someone who thus acknowledges the essential role that trade unions have to play, and who has worked with them at various levels in industry, may I add this. We know what in the past trade unions have been against. They have made that pretty plain in effectively bringing down the last three Governments, if one excepts the interim Wilson Administration of 1974–75. What the nation now wants to know is what the trade unions are in future going to be for. There is need in particular for them to answer this question. Since they make such great demands on the wealth of the nation, what are they prepared to do to add to that wealth? Surely the primary objective of trade unions should be to further the interests of their members in the long term, and that can only be done by helping to increase the size of the national cake before arguing about how it is to be sliced up. There is need, in my view, for the Government, too, to help in this process of wealth creation, if I may put it that way, by taking every opportunity to encourage action within industry, first, to increase the involvement of employees in influencing the making of decisions that affect them, and, secondly, in promoting a shared understanding between management and employees of business realities. I was glad to hear what the noble Earl, Lord Gowrie, had to say in his opening speech on that point.

If it is right for management to inform and consult with their employees in industry, it is surely also right that the Government generally should practise what their more enlightened members are now preaching. With inflation running at 22 per cent. there is, in my view, an increasingly urgent need for discussions to be reactivated between representatives of Government, employers and trade unions at the highest level, with a view to establishing agreed long-term procedures for pay determination, and a greater general awareness that the nation can no longer afford increases in pay that are not matched by improvements in productivity.

It will not, in my view, suffice to claim that this has nothing to do with the Bill before us, for in the field of industrial relations the questions of pay, prices and employment are inextricably linked. I hope that when the noble Earl replies to the debate he will find it possible to respond positively to that view. We have all got this problem on our hands, and between us we have somehow got to reach agreement as to the purpose of industry and the action needed to achieve that purpose. It is my conviction that in the long run it is only through learning to work together in such ways that we shall succeed.