EMPLOYMENT BILL

HL Deb 20 May 1980 vol 409 cc772-904

Second Reading debate continued.

4.44 p.m.

Lord KEITH of CASTLEACRE

My Lords, it is an honour and a privilege to stand aside and make way for my noble friend the Foreign Secretary. Reverting to the Employment Bill, I am well aware of the fact that my first speech in your Lordships' House should be non-controversial. I hope that nothing I shall say will offend on that account. I speak, not as a lawyer, but as a manager. Seen through the eyes of a manager of British industry, the present Bill seems to me to be a moderate, middle-of-the-road attempt to deal with a limited number of major problems.

I would quickly make three general points. First, by confining themselves to a limited number of specific trade union affairs and not attempting a root and branch reform of trade union law, I believe that the Government have shown great common sense. The lessons of the last 12 years, which have already been changes attempted all at once in trade union law have tended to be counter-effective, and they have certainly not produced the results for which their advocates hoped.

Secondly, I believe that this law must establish a proper structure, a fair balance, to enable management and unions to work together constructively in order to raise productivity and to improve the comparatively low standard of living which currently exists in this country, and which would be considerably lower if it was not for North Sea oil. As a manager I do not believe that the laws as they presently exist are conducive to this end. I believe that I am part of the large majority of employers, trade unionists and members of both political parties who think that the law requires amendment.

I think that there is strong evidence of public support for the changes contained in this Bill, particularly those dealing with the closed shop, picketing and other forms of secondary action. I do not think that the clauses in the Bill will prevent all the worst features of the last two winters' industrial disputes from recurring. Nor do I think that any law which is currently enforceable can do that. However, I believe that this Bill will help to strengthen the hand of the moderates in the unions and in the workforce generally, and my experience as a manager is that it is the moderates who are in the vast majority. If the Bill does this, it will go a long way to reduce the extent to which exploitation and intimidation can occur.

Thirdly, I believe that the Secretary of State is right to take this step-by-step approach. There are no proposals in the Bill which I believe, by any stretch of the imagination, can be regarded as extremist. I believe that they will command the support of the vast majority of the nation's workforce, which is vital if the Bill, when it becomes an Act, is to be effective on the shop floor. The moderate tenor of the Bill will, I think, make it difficult for the extremists to exploit it for their own political purposes, as they did the 1971 trade union Act.

I should now like to turn to three particular aspects of the Bill. The first is postal ballots. I am wholly in favour of postal ballots for electing union officials, for amending union rules, and for other like matters. I think that in most of these cases these ballots should be made secret compulsorily. However, I should like to utter a word of warning about the too frequent use of the ballot in industrial disputes. They may have proved very effective on occasions, in particular in the British Leyland case. This was a major issue put to the workforce, and the workforce accepted what was put to them by an overwhelming majority.

I also think that, had we had a secret ballot last autumn for the engineering dispute, the outcome might have been different. The decision to take strike action was taken by the narrowest majority of the AUEW and the workforce was not consulted. The result of that long-drawn- out strike was that everybody involved suffered— the country, the industry and those who worked in it. I think that this is an occasion when the ballot should be used. I do not think, from my experience, that the ballot should take the place of the mass meeting and what goes on in the shops. It should be used when there is either doubt as to how the meeting was conducted, or doubt as to the outcome of the meeting, but it should not be used in substitution for the meeting.

I should now like to refer to the closed shop. I am against the closed shop as a matter of principle. There are arguments for and against. I appreciate that in some cases employers and unions have reached agreements to their mutual benefit, and provided there are proper safeguards I cannot see that, in a democratic society, one can cavil at that. What we must have, and what I believe this Bill gives, are the necessary safeguards to protect the rights of the individual. An employer cannot dismiss an employee without that employee having the right of appeal to an independent tribunal. The employer can deprive a man of his job. The union can deprive the man of the ability to get another job, and in normal times this is a more serious matter. It is only right therefore that a man threatened with the loss of his union card should have the right to appeal to an independent tribunal, as is laid down in this Bill.

I think that this is a sensible Bill, a workable Bill, and that we should give it our blessing. I know that one can legally find a great deal of difficulties and faults in it. One can try and go through the problems of secondary blacking and such areas, but they will be ironed out with experience. I believe this Bill is sensible, middle of the road, and that we should pass it.

4.53 p.m.

Lord HARRIS of HIGH CROSS

My Lords, this is the first opportunity I have had to follow and congratulate a maiden speaker, and I must say that it is a most agreeable occasion for me. I have met the noble Lord, Lord Keith of Castle- acre, in the real world outside, and had no doubt that he would impart something from his great practical experience. If I may say so to the noble Lord, it was a Rolls-Royce of a speech, although it was more audible, which is just as well in this strange Chamber. We look forward to the noble Lord's future contributions to our debates, to which we know he can bring a wide and almost unrivalled range of experience of industry and commerce that will help us to advance understanding in some parts of these Benches here.

We are going to hear expressed a wide variety of sincerely and deeply held views about the nature of trade union law before the day is done. There is scope for much difference of opinion. It seems to me that the least plausible view that we have sometimes heard— although not yet in this debate— is that which says that the law has no place in industrial relations. It should be obvious that free institutions cannot operate in a legal vacuum, and indeed they work only in a framework of law that specifies the rights and responsibilities both of individuals and of collectivities.

I want to turn, to learn from experience elsewhere, to Germany, from which the Bullock Committee took convenient examples of activities as a model for its recommendation on industrial participation. In Germany, trade union law rules out political affiliation and action by trade unions; it prohibits closed shops; it enforces collective agreements, and requires ballots before strikes. There being only 16 unions operating in Germany, demarcation disputes are extremely uncommon. Yet, lacking the enormous privileges and immunities that the noble Lord, Lord McCarthy, thinks desirable and that British trade union leaders have come to take as their birthright, German unions have served their members far better than British unions in this country over many decades.

I want to state my own personal conviction that it is the excessive power of British trade unions, both to obstruct improved techniques and to deflect the efficient use of labour, that is the chief reason why our wages have fallen over this century from approaching double European levels to nearer half. Even when in steel or cars our plant is identical to that operated by our European competitors, it commonly takes twice as many British trade unionists to manage it. No wonder our competitors have more modern equipment that they can use more effectively. It was Sir Henry Phelps Brown who showed for 1972 that wages and salaries took 84 per cent. of the value added of British industrial and commercial companies. Eight years later, in 1980, labour's take is considerably in excess of 84 per cent. of value added. This leaves little if any real reward for investment and risk-bearing. It seems to me naive in these circumstances for the TUC to complain about a strike of capital.

During the last two decades it seems to me that we have witnessed an irresponsible trade union movement deploying irresistible monopoly powers to cause an alternation between mounting unemployment and escalating inflation. First, they priced their members out of jobs by seeking wages above the value of output. Then they urged governments to restore full employment by monetary excesses that can only result in faster inflation. This debases the currency in terms of which the higher money wages were paid.

It is often thought that economists are rather dismal fellows, and it seems to me that we have a great deal to be gloomy about. But of all the episodes in post-war political economy the most depressing for me has been the frequency with which reforms on many topics, embodying lofty ideals, have led through neglect of market realities to results almost precisely the opposite to what was intended. However noble the original inspiration of the trade union's protectionism, its power has proved to be a power to impoverish. It has perversely destroyed jobs through inflating money wages whilst retarding real standards of living through checking the better use of capital and labour.

I conclude that British trade unions have too much power for their own good; they have too much power for the health of their leaders; they have too much power for the welfare of their members. The German example demonstrates that effective unions do not need to conscript members into closed shops; they do not need to rely on immunities for breach of contract. Responsible union leaders need not shrink from ballots nor tolerate picketing on a scale that amounts to intimidation.

Every indication of public opinion suggests that we would have overwhelming support— not least from union members— in strengthening the curbs that this mild Bill proposes against the coercive powers so often exerted by unrepresentative minorities in the trade unions in recent years. It seems to me that, in the widest interests both of higher employment and of rising real wages, noble Lords should not shrink from considering amending this Bill. Indeed, I hope that they will amend it in the direction desired by most of our fellow countrymen— including a growing number of former stalwart members of trade unions and the Labour movement.

5 p.m.

Lord ALLEN of FALLOWFIELD

My Lords, I rise to register a note of dissent and opposition to the Bill, in particular to certain clauses of it. Indeed, as I listened to the noble Lord, Lord Harris of High Cross, I thought we were going to be entreated to a claim for the total abolition of the trade union movement,

I wish, in entering this debate, to indicate the interest I have in doing so. I do so against the background of many years of active and genuine participation as a representative of the national centre of the trade union movement and formerly as a general secretary of a major union for 17 years. As a representative of the national centre of the trade union movement, I had meetings with Governments going back to the days of Harold Macmillan when he was Prime Minister and five Prime Ministers who have been in power in this country since then, discussing largely the problems on which we have been touching today, but most of all the economic issues and how we could best adjust to those in the name of society.

The trade union movement, I regret— but I understand the reasons why— is slowly but, it seems, inevitably entering a new and harder phase in its opposition to the Government's proposals. My opposition in respect of certain clauses arises because I believe the Bill to be totally unfair, and briefly I will explain why. It is unfair because it will remove many of the established rights of workpeople. One million working men and women have already had their protection against unfair dismissal taken away, and advance notice of redundancy has been slashed for hundreds of thousands of workpeople. Particularly hard hit by these new measures will be people working for small firms and mothers wishing to return to work after having a baby.

Clause 5 is unfair because an employer called before an industrial tribunal in an unfair dismissal case, if these proposals are sustained and the measure becomes an Act, will no longer have to prove that he acted reasonably in sacking a worker. Instead, the worker will have to prove that his former boss acted unreasonably. The same clause is unfair because the job of proving the case is switched from the employer, with all the resources at his disposal, to the recently sacked worker, who usually has no job, no income and, unless he is in a union, nobody to speak for him.

Under Clause 8, the present minimum compensation of two weeks' wages will be dropped if these proposals are enacted. A worker could win his or her case for unfair dismissal at an industrial tribunal but still get no payment. Under Clause 5, employers may be able to "duck" their obligations to treat workers fairly by using let-out clauses concerning their size and, of course, their circumstances; the smaller the firm, the less chance a worker will have of winning his case at an industrial tribunal. Furthermore, workers in small firms will need two years' service, not the normal one year, to claim unfair dismissal. So one could go on to itemise the unfair aspects of the proposals in the Bill.

It is one thing for this Government, as one so often hears, to claim that in response to their election pledge something is being done, and quite another to demonstrate that the right thing is being done. We have witnessed a low key presentation, for which I am grateful, by the Government and especially by the Secretary of State for Employment in another place. He has claimed, as did the noble Earl, Lord Gowrie, today, that the Bill is limited and modest. Whether or not that be true is open to question. I simply want to say that industrial relations is not about political theorising, nor is it about drafting in the cosy conformity of any particular room. Industrial relations is about people at work, about human relations, and those work people who have been the casualties of Government policies, rising unemployment, escalating price increases, with no tangible intervention by the Government to restrict or minimise the great price rip-off that is taking place today in our society, take the view that there is precious little humanity about a Government who stand idly by while all this takes place. Many in the community today, the organised and the unorganised, I am sure condemn the Government for their casual attitude to the suffering and anguish that come from their present policies.

The burden of my opposition to these proposals at this time in the life of our society is that they will do nothing to ameliorate the effect of this indifference by Government to those men and women who have been the victims. The proposals are irrelevant to the basic issues of improving industrial relations, real earnings and, above all, job security. The Government may bludgeon this unnecessary piece of legislation through this House and another place, but what they will not succeed in doing is win the support of all those whom it will most affect.

What about the employers? I have no doubt, knowing many of them as I do— employers who are very far-seeing in their industrial relations policies— that they will be looking askance at the proposed legislation. Indeed, one believes there have already been some adverse utterances by the Engineering Employers Federation; and for those who are forward-looking and successful in winning the consent, co-operation and support of their workforce for good industrial relations, there must be a cavernous gap between what is political theory and practical reality, and that is the issue facing us today. My experience compels me to believe that this Government, regrettably like previous Administrations, will eventually see that proposals and legislation of this kind will not solve industrial relations problems, but that only people can solve those problems.

In making a statement of that kind, I ask noble Lords to bear with me while I relate briefly my experience as a member of the Commission of Industrial Relations when it was initially set up by a previous Government. I was privileged to serve and make what I believed and hoped would be a constructive contribution to industrial change between employers and the employed, and to make that contribution within the setting of a voluntary approach to those problems.

That belief, I regret to say, was destroyed when the then Government unwisely decided to distort the original structure of the CIR, and eventually decided to reshape it and then kill it off. I make bold to say that had that not happened then, a great many of the industrial problems that we have had since may not have been with us. I believed then and I have believed since that for the Government to do that was a shabby manoeuvre and an act of lunacy. Whatever one's political connections, there can be few who cannot be worried about the challenges which face us, not least in the area of achieving much more productive industrial relations, based on consent and co-operation, as opposed to confrontation— and I have been against confrontation all my life.

It was said from the other Benches earlier that these proposals will help the moderates. I am making bold to say that these proposals will unfortunately make many moderates militants overnight, and that is to be regretted. Industrial relations is the one key factor in our rather poor international performance, whether judged by growth rates, productivity, inflation or levels of investment. The survival of jobs, of companies, and in some cases of whole industries is at stake today in the United Kingdom. Today the Daily Telegraph economic commentator talks about the slide into recession. Here we are taking the time of this House and the time elsewhere, to deal with proposals which have no relevance to the economic issues confronting us in Britain.

This is a situation that will not be overcome by this Bill before your Lordships' House. It is clear to me, after drawing on many years of industrial relations experience, that an immediate objective of those responsible for management/labour relations, and who recognise (as many do) the urgency of the current situation, should be to attack the problem on a broad basis at company level, as opposed to total reliance on proposals or legislation of the kind embodied in the Bill.

I have never believed that there is any panacea for these problems. Whatever happens, the unions in the United King- dom should not be forced into the position— a risk, I am afraid, that will be run by some of the proposals in the Bill— where they acquire the irresponsibility that comes from rejection and mass disobedience. For me good management, sensible and responsible trade union leadership, and the development of good industrial relations remain the best antidote now and in the immediate and long-term future. There is no short cut to those objectives— certainly not by this Bill.

I oppose the Bill for many reasons. One of them uppermost in my mind is the knowledge, gained from past experience in dealing with trade union membership, Governments and employers and their representatives, that reform will not come from legislation, nor from the courts. As has been said so often in this House, this nation is facing immense problems— problems of inflation, problems of unemployment, problems of technology; indeed fundamental problems of how our society operates. Problems facing the United Kingdom of inflation, competitiveness, ineffective use of capital, the need for a response to new technology, lack of growth, unemployment, and social inequality, can be dealt with only by a partnership between the Government, the trade unions and the employers. It is my regret that so little of that partnership exists today.

Industrial relations, like pay, is but one of a whole complex of economic, industrial and social factors central to our economic future. We now have a Government apparently determined and committed to severe monetary constraints and to the releasing of the full vigours of market forces. Time will show how long this particular policy mix will last. I believe that it is doomed to failure. Why?— because there is no consensus in the country in support of it. There is no support between those who believe that the policy is right and those who are expected to conform to its operation. Sooner or later the accent will have to return to one of co-operation and fulfilment, rather than confrontation and frustration, if the problems of the 'eighties are to be tackled successfully.

Good industrial relations, the acceptance of agreed policies by Government, management and trade unions, are crucial to Britain's competitiveness. I very much regret that I do not see this Bill as making a contribution to this objective. Indeed, I believe that this Bill has about as much chance of being accepted by the overwhelming number of the British trade union movement as has a strongly motivated gathering of licensed victuallers of persuading an equally strongly motivated gathering of those who believe in the Band of Hope. That is about the chance that this Government have of gaining acceptance of these proposals in the country generally.

I challenge those who take a contrary view. I challenge those who believe— and I do not challenge them as a militant, but as, I hope, someone who has contributed to constructive trade unionism for many years— that the clauses of the Bill before this House make any contribution to the solutions to which I referred earlier. I am persuaded that lasting solutions to our problems must be found in agreement, and not in legislation or clauses of the kind now embodied in the Bill.

5.18 p.m.

Viscount DE L'ISLE

My Lords, in his opening speech my noble friend Lord Gowrie was, I thought, rather dismissive of the three dismissed railwaymen at Strasbourg. I think he will find that that case will not be so easily disposed of, nor will its consequences. I believe this because that case intimately effects our treaty rights, particularly our treaty obligations in the Council of Europe and under the European Convention on Human Rights. I should like to take a little of the time of the House to explain why I think so.

Today the European Court issued a communiqué to say that it was receiving a report from the Commission of Human Rights on the question of whether the three railwaymen's rights had been violated. Those three railwaymen, Messrs. James, Webster and Young, claimed that their human rights under the convention— under Articles 9, 10, 11 and 13; that is, those concerned with freedom of conscience, freedom of speech and freedom of association, and the remedy— had been violated when they were dismissed by British Rail in 1976. They were dismissed because they refused to join a trade union under the closed shop agreement reached between British Rail and the railway unions.

A reference to the court could not have been made unless at least a majority of the members of the commission were of the opinion that the present laws of the United Kingdom were inadequate to protect human rights. The railwaymen's dismissal was undoubtedly lawful under the legislation passed in 1974 and 1976. They had no means of redress under English law. Mr. Webster appealed to a tribunal consisting of railway officials and trade union officials, and his appeal was dismissed. Mr. James appealed to an industrial tribunal, and his appeal was also dismissed. On the advice of the Freedom Association, of which I am chairman, and with its support, the railwaymen took their case to the Commission of Human Rights. They were able to bring their application to Strasbourg because in 1966 Sir Harold Wilson's Government declared that they recognised the competence of the court to receive individual applications. It may be significant, my Lords, in the present context, that the Conservative Government which preceded Sir Harold's declined to recognise the right of individual application.

The European Convention of Human Rights and Fundamental Freedoms was signed in 1950, as noble Lords will remember, and entered into force three years later. A citizen of a member state which has recognised the competence of the commission and who can show that he has exhausted all domestic remedies may petition the commission claiming that his Government have violated his rights under the convention. In this case, as I have said, the petitioners alleged breaches of Articles 9, 10, 11 and 13. The Department of Employment, under Mr. Booth, strenuously contested the case and managed to delay the hearing by repeated applications for further time. The hearing finally took place on 9th July last, and the commission then reached a provisional opinion in the case.

Under the Strasbourg procedures a very large measure of secrecy is observed about the proceedings before the commission. Although the Government under question are informed as to the commissioners' opinion, the petitioners must depend on the communiqués published by the commission. However, as the proceeedings continue, certain matters become clear. The fact that the commission admits an application is an encouraging sign to the applicant, since the vast majority of petitions are declined and declared inadmissible. An oral hearing is a further encouragement.

Following the hearing, the commission stated that it was placing itself at the disposal of the parties concerned with a view to securing a friendly settlement on the basis of respect for human rights as defined in this convention ". The only move in this direction made by Her Majesty's Government was a letter to the commission stating their willingness to consider costs for the railwaymen if they were willing not to pursue their case further. Very naturally, the applicants, by counsel, declined to comply. It therefore remains an academic question whether the commission could have approved any settlement on such a basis as showing respect for human rights.

Since no solution was reached by the time the commission held its next session, the commission drew up its report on the facts and stated its opinion as to whether the facts disclosed a breach of the Government's obligations under the convention ". Again, in accordance with the convention, the commission's report was transmitted to the Committee of Ministers and to the United Kingdom. The petitioners had to rely for their information on the communiqué which the commission issued after its meeting last December, where it confirmed its provisional opinion on certain complaints of the closed shop in British Rail ". There could no longer be any doubt that in the opinion of the commission there had been a breach or breaches of the rights of the three railwaymen, even though the nature and extent of that violation remained to be revealed.

After the December session, the commission once again informed the petitioners that it was still ready to use its good offices towards a friendly settlement; and, although the applicants held themselves ready to consider any move by the Government, none was forthcoming. In December last Mr. Prior introduced his Employment Bill in another place. As the Bill proceeded there, the railwaymen's case proceeded at Strasbourg. The Government are obliged to recognise any decision of the court as binding upon it, since Britain has already declared that it recognises the court's jurisdiction. It is relevant to note that in the 23 years of its existence the court has never so far failed to support the overall view of the commission on violation of human rights.

The petitioners' main argument before the commission was that the laws of the United Kingdom were inconsistent with Article 11 (1) of the convention. That article reads as follows: Everyone has the right to freedom of peaceful assembly and to freedom of association with others including the right to form and to join trade unions for the protection of his interests ". One of the arguments put forward by the Government in resistance to the applicants' claim was that the right to freedom of association did not include the right not to be compelled to associate against one's will. It seems clear that the commission has rejected this argument, which is indeed contrary to the express terms of Article 20 (2) of the Universal Declaration of Human Rights— a declaration which is cited in the preamble to the European Convention. Moreover, in a case decided in 1969, the commission took it for granted that the right of association includes its converse.

Furthermore, it is difficult to see how the right to form and to join trade unions, for which Article 11 expressly provides, can be exercised where a closed shop exists, in such a case, it seems that the employer who has already agreed with an existing union to employ only its members would be unable to recognise a new union formed by some of his employees for the protection of their interests. He would be bound to dismiss such employees if they persisted in their enterprise. It would certainly be convenient for the House if it could consider the terms of this Employment Bill, and in particular Clause 6, in the light of the commission's adopted opinions in the railwaymen's case. But, since this specific information is denied us, noble Lords ought not thereby to neglect the relevance of the European Convention when considering and, if need be, amending the Bill before us.

It is, I suggest, a fundamental defect in the Bill that we are considering that, although it modifies and amends the legislation of the previous Government.

it still permits the principle of the closed shop. This, I believe, is repugnant to the convention. It is certainly contrary to the whole concept of individual freedom, of which the convention is an authoritative expression, that a man's right to work in his chosen trade should depend upon his submission to the rules of an association which he is unwilling to join. This is no theoretical or trivial matter.

Let me refer your Lordships to the rules of the National Union of Railway- men. An applicant who wishes or is required to join the NUR must undertake— and I quote— loyally to promote the objects of the Union, and to be obedient to the rules now in force or which may hereafter be adopted ". By rule 9.1, no person shall be admitted a member unless he has previously signed this declaration. The objects of the union, which the applicant promises loyally to promote, include the obligation: to work for the supercession of the capitalistic system by a Socialistic order of society … ". The applicant who wishes or is required to join ASLEF must sign that he agrees to advance the interests of the society and conform to its rules. The objects of the society as set out in rule 4 include the furtherance of the Labour movement generally towards a socialist society. It is to be noted that rule 5 (10) provides— and I quote— that any member who is disloyal to the Society's interest by opposing official candidates in sectional council or local departmental committee elections … will render himself liable to expulsion from the Society or such disciplinary action as the Executive Committee may think fit ". Can the Government really assure this House that a Bill which does not put an end to such situations can be in accordance with the European Convention? The Bill provides that dismissal for refusal to join a union shall be unfair if a union membership agreement taking effect after the Act comes into force has not been approved by a majority of not less than 80 per cent of the employees.

If my contention that the closed shop is inconsistent with the individuals' human rights to freedom of association, speech and conscience is sound, it must be inadmissible to empower a majority of the individual's fellow employees to deprive him of that right. It is fundamental to the convention that it is the right of the individual not to be deprived of his lawful freedom of conscience, speech and association by the actions of his fellow citizens. In fact, the convention upholds the right of dissent, which has been a valued right in this country for 400 years. The Bill, which offers compensation rather than redress, cannot meet the requirement of Article I of the Convention: that the high contracting parties shall secure to everyone within their jurisdiction the rights and freedoms defined therein.

A right granted under the Convention is a right granted to a person, not to an organisation, nor to the majority in an organisation. Under the Convention slavery or torture, which was mentioned earlier in this House, would remain unlawful whether or not these enormities had been endorsed by a majority here or elsewhere. The rights protected by the Convention are co-equal in the legal sense. There is more than one opinion in this House, as elsewhere, upon the relevance of human rights to British society. But that matter has been debated and was settled when we joined the Council of Europe and adhered to the Convention. There has been questioning, too, on the propriety of a British citizen being allowed to make an individual application at Strasbourg. But that matter too has been settled.

So we are brought directly to the consideration of the responsibility of your Lordships' House in this matter of human rights as these are involved by the Bill before us. We shall hear no doubt that, since the case at Strasbourg is still sub judice, we can legitimately await the Court's decisions while in the meantime accepting the Government's advice to pass it in its present form. But should we, in all conscience, do so?

We have already heard from the noble Earl that in drafting this measure, they have taken the railwaymen's case into account and have met precisely the grounds of that complaint. Could that be so in the light of the provisions to which I have drawn attention? In Mr. Prior's Bill, there is still no remedy which satisfies the Convention available for a man who is forced to join a union, and has to surrender his freedom of conscience under threat of losing his union card, and with it his livelihood.

It was precisely because civilised opinion was appalled by totalitarianism as expressed before and during World War II by Germany and Italy and by Soviet Russia, that the human rights movement was born. "Everyone has a right to recognition everywhere as a person before the law"— so runs Article 6 of the Universal Declaration. A person from whom an undertaking such as I have just read out is unwillingly extracted, as a condition of his employment, is a person deprived of basic human rights which his Government as a party to the Convention has a duty to protect.

Let us remember, too, that this House has recently passed a Bill to incorporate into the British system Articles 1 to 18 of the European Convention. That Bill waits in the antechamber of the House of Commons. Must we wait for it to reach the statute book before we declare our attitude to those parts of the Employment Bill which directly affect the human rights of our citizens? Must we not insist that the Employment Bill shall satisfy the human rights which, as a House, we have agreed should be the justifiable rights of every British citizen? I should like to believe that we might persuade the Ministry that its obligations under treaty for the observance of human rights should take precedence over its immediate legislation and political convenience. But I cannot be optimistic.

The noble Lord who normally sits upon the Woolsack has convinced himself, and has helped to convince the House, that the time is ripe for individual rights to be enshrined in our constitution and thereby protected; but behind every member of every Adminstration stands the ghost of Lord Melbourne repeating softly, "It is not much matter what we say, but mind, we must all say the same." Members of this Government, including the noble and learned Lord, Lord Hailsham, will, I fear, follow precedent and speak in unison. But the rest of us are free to follow our conscience and our judgments. I believe that this is the time to do so.

5.35 p.m.

Lord PLANT

My Lords, the noble Earl, Lord Gowrie, in an excellent and persuasive speech, said that the Bill was simple and straightforward. I do not accept that for a moment, and I will attempt later to show why. In another place, the Secretary of State for Employment said that he wanted a consensus. The Government, unfortunately, could not obtain agreement from the TUC for any trade union legislation which circumscribed the rights of its members. The trade union movement has fought over the years for better treatment for its members. It is not prepared, in 1980, to give up any of these hard-won rights. It avoided the straitjacket of In Place of Strife which the Labour Government obtained from those Downing Street discussions and the valuable co-operation of the TUC that they voluntarily would urge the unions to greater co-operation.

The Industrial Relations Act 1971, so the Government said, was what the electorate wanted. It proved to be a disaster. In passing, it might be mentioned that the one ballot ordered under that Act was a disaster for the Government. You can only have legislation in industrial relations if there is ready acceptance of the law. Legislation cannot work if the great majority of the workforce are not prepared to accept the law on the basis that it is unnecessary, undesirable and unfair— as, indeed, time will show is the position with the Bill we arc now discussing. I believe that the rights of individuals at the work place, as elsewhere, must be respected. I am a firm believer in accession to the EEC, to the European Convention on Human Rights. I was interested to hear the noble Viscount, Lord De L'Isle, discussing the possibility of a Bill of Rights. My Lords, this Bill, however, damages trade union rights and individual rights. This Bill, brought forward in stockinged feet with a Green Paper round the corner, seems to the TUC to be edging the trade union movement back to 1971.

Let me return to the so-called simplicity of the Bill. The pregnant woman will not agree that it is simple. The Bill's complicated procedure (which must be followed in order to secure entitlement to return to work) will act as a disincentive to exercising this maternity right. There is a new clause on the legal definition of secondary industrial action. This is dangerous. The new definition of the formula— "in furtherance of a trade dispute"— in respect of secondary action is objectionable, limiting the scope of that formula more narrowly than ever pre- viously in English law. There will have to be new, statutory, objective, capability tests; and the effects of this will be to put the control of the legality of industrial action into the hands of the judges. Here, may I read what the noble and learned Lord, Lord Scarman, said in the McShane case: It would be a strange and embarrassing task for a judge to be called upon to review the tactics of a party to a trade dispute and to determine whether, in the view of the court, the tactic employed was likely to further or advance that party's side of the dispute. And the difficulties which have beset the Court of Appeal in their attempt to formulate a test are a persuasive argument for keeping this act of judgment in the industrial arena and out of the judicial forum. It would need very clear statutory language to persuade me that Parliament intended to allow the courts to act as some sort of backseat driver in trades disputes ". This issue has not been referred to, but I think it should be and probably will be in the Committe stage.

The noble Earl, Lord Gowrie, said that he did not think that the Labour Party would repeal this Bill. I think that they will— at any rate, certain clauses will go. At a late stage the Government accepted paid time off for ante-natal care. This was put into the Bill after the TUC gave evidence to the House of Commons Select Committee for Social Services last February on perinatal mortality. Obviously, we should wish this important provision to be retained. There can be little doubt that married women are being dealt with differently depending on the size of the firm employing them. I doubt whether this discrimination will stand up to the scrutiny of the various International Labour Organisation conventions and the European Convention on Human Rights. I believe that if this Bill stands as it is there will certainly be some women going to Strasbourg to test its validity.

We need to preserve he opportunity to talk. I believe that agreement and cooperation from the TUC is possible. The Government should invite the TUC for discussions over the whole field of industrial relations and economic problems. Do not let us remain at arm's length. I see the noble Lord, Lord Carr of Hadley, sitting opposite. It reminds me that in the autumn of 1973 talks took place at Chequers on an incomes policy, and I believe that we were within five minutes of agreement. It was unfortunate that agreement was not reached.

Then again, early in 1974— very early in 1974— the miners were at that stage threatening to strike and banning overtime, and the Government asked the TUC if we would regard the miners as a special case. One morning, just before the NEDC met, we agreed that they should be treated as a special case. But imagine our surprise at the NEDC in the afternoon when Len Murray announced that the Government said that they were not prepared to accept the miners as a special case. Those two instances I mention from my experience where talks have gone wrong, when, with hindsight and a little more forbearance, the country would have been in a happier state.

This Bill is basically irrelevant, as so many people have said and will be saying, with 1½ million unemployed and inflation at 22 per cent. It will do nothing to deal with our twin enemies of the social structure of this country. In 1960 there was a mood of co-operation. We had the Donovan Commission. Then the trade union movement went on the defensive against Government legislative interference. The TUC became less constructive and more defensive as legislation came forward. The TUC disputes committee, operating the Bridlington Agreement (which deals with poaching issues and disputes between one union and another) is in danger, and is now threatened by this Bill through Clauses 3 and 6. The TUC takes a similar line to that of the chief constables when they gave evidence to the House of Commons Select Committee on Employment. They said: "Let the law as it now stands deal with picketing".

There could be gross exploitation of workers where they are weakest; that is, in the small firms. We feel that most employers of small numbers of people respect the opportunities of their workpeople; but there are some who do not. There will be some exploitation as a result of this Bill by the employers of small numbers of workers. There is a genuine fear among trade unions, which has not yet been dispelled, that the Bill is designed to diminish the negotiating strength of unions in modern society. The detailed discussion at Committee stage will no doubt help to dispel some of our fears and will deal with the important issues raised by the noble Viscount, Lord De L'Isle, where the Strasbourg ruling has still to be reviewed by the European Court at Luxembourg, although I believe that I am right in saying that Luxembourg has not overturned a Strasbourg ruling since it was set up.

5.46 p.m.

Lord ROBBINS

My Lords, we are confronted today with a Bill of very considerable technicality. I suspect that the issues concerned will detain us very many hours in Committee. I make no complaint of this. Indeed, I will argue later on that this is the best way to deal with the anxious problems of the day. But, at the same time, it is a Bill which raises in one's mind deep questions of principle very appropriate for discussion at Second Reading. It raises the question of the function of law in general in the sphere of international relations. It raises the question of the place of associations, of producers and their rights in a free society. I hope therefore that noble Lords will bear with me if, before coming to the specific object of the Bill, I allow myself to reflect a little on these fundamental issues.

I begin with the function of law in industrial relations. As the noble Lord, Lord Harris of High Cross, has already said, how often do we hear it said, even in this House: The law has not a part to play in this area, and it is better to leave things to adjust themselves as a result of spontaneous evolution of industry. Nothing but harm is done by interference in these connections "?

I cannot easily say how wrong-headed this seems to me to be. It ignores the fact that the law as it stands in this country is already deeply committed for good or for bad with industrial relations over a very wide field; and as anyone who has taken the trouble to look at this involvement of law in industrial relations— even superficially— will discover from a few minutes' examination, this involvement is not such as can be simply written on two tablets of stone

Secondly, I find it wrong-headed because it ignores the fact that in other free societies the law in this respect has assumed the forms and invaded relationships in the industrial field which in this country— rightly or wrongly— has been regarded as inappropriate. Our famous immunities are not regarded elsewhere as inviolable. As Lord Harris points out, in Germany the law in this connection is entirely different.

Thirdly, my Lords, ascending for a moment to the philosophy of the free society, the belief that law is out of place in this connection rests wholly and totally on misconception. The idea of a free society is not the idea of a free-for-all. We often hear it so depicted by its enemies, certainly elsewhere— I will not say in this place; but it is not so. The conception of a free society is a conception which seeks freedom within a framework of law which attempts to prevent the freedom of individuals and groups of individuals from curtailing the freedom of others.

This brings me to the question of freedom of associations in industry. Now let us remind ourselves that in an unfree society such societies are planned and controlled from the centre and any alleged freedom of a group, be it trade union or some other association, is a façade; behind lie torture, concentration camps and exile. In a free society there is no prohibition of spontaneous association. On the contrary, the institutions of property, contract and so on give rise to widespread initiative and activities in no way specifically planned or directed from the centre. But at the same time— and this is where the function of law comes in— it is recognised that completely unregulated association may give rise to manifestations which are anti-social in character.

Take, for instance, the formation of giant combinations of capital. These may or may not be inevitable in the interests of production, but they may also involve monopolistic powers which are inimical to social harmony. Accordingly, in most free societies there exist legal powers to investigate and prohibit the possibility of their misuse. In this country, we have the Monopolies Commission which exists to examine such possibilities and to recommend that certain combinations be prohibited and certain activities disallowed. Or take again the possible powers of industrial producers to restrict the output of would- be competitors or those producers who are dependent lower down the line on their own output. Here, again, in this country it is deemed appropriate to restrain such powers by law— the law relating to restrictive practices.

If we look around in our own country, it leaps to the eye that there are many very significant exceptions to the rule of law in this connection. Thus, the investigation of monopoly power among associations of employees is nobody's business as regards the law. Make no mistake, my Lords, I am not contending that all trade unions are monopolies— some are most clearly not— or that they necessarily abuse monopoly power. But the fact is that there is a good deal of monopoly power knocking about in such circles and it is open to question whether it is not sometimes ill-used. I need not allude to the events of the winter before last. I have even heard from the Opposition Benches pleas for an incomes policy depending upon the very true fact that the labour market is not unequivocally competitive; "oligopolistic" was the opprobrious word which has sometimes been used. Or, take restrictive practices. Surely what is sauce for the goose is sauce for the gander and no one who has any contact with business can deny that restrictive practices occur among associations of producers.

Are we really prepared to put our hands on our hearts and to say that whereas such practices are anti-social if they occur on the employing side, they are socially beneficial if they occur on the side of the employees? Are we prepared to put our hands on our hearts and protest that the delays in the introduction of superior technology in nationalised or non-nationalised industry are wrong if they occur on the side of management, and that they hold back the increase of the national product, but they have the reverse effect if they originate on the side of the unions?

Questions of this sort which run through one's head lead me to the conclusion that all has not been well in the historic development of our law in this respect. They lead me to the conclusion that there has been no invisible hand guiding the policy of laissez-faire in this respect, guiding the policy to results which are optimal from the point of view of the public in general.

Nevertheless, my Lords— and at this point some of my friends in your number may regard me as cowardly— I am not one of those who advocate immediate and drastic action all round. I am not one of those who press: To grasp this sorry scheme of things entire, To remodel it closer to the heart's desire ". Our society is a going concern and democratic progress rests on argument and persuasion. Therefore, as the noble Earl who introduced this Second Reading pleaded, I regard it as a virtue in the Bill that it is not all-embracing but applies itself to the correction of the law in regard to a limited number of abuses. I have a strong conviction that where the historic tendencies have been of long duration— wrong though some of them may be— it is a mistake to deal with them all at once.

I suspect that Mrs. Castle's In Place of Strife and the Act which was passed under Mr. Heath's Government came to grief because they attempted to do too much too soon. I do not say I feel— far from it— that the present Bill removes all removable imperfections. I do not argue that the passage of this Bill will be the end of the road, but I do commend its method. The high spots of this Bill are threefold: limitation of the power of the closed shop and the coercive recruitment of non-members by unions; limitation of the scope of lawful picketing, and the financing of secret ballots.

May I conclude merely by indicating my initial attitude to these problems? I confess that I view the closed shop with suspicion. I do not think it fits well with the habits of a truly free society, as has been forcefully argued by the noble Viscount, Lord De L'Isle. Nevertheless, as the noble Lord, Lord Rochester, said, it exists and some employers prefer it. How much better, therefore, at this stage to deal with its abuses rather than its abolition and to ease the criteria under which it is lawful to disagree!

I reflect on possible events in my own sphere of action over many years. If there were a closed shop in the Union of University Teachers— which, thank Heaven! there is not— and if I had been a member I wonder whether I should have got out by pleading severe religious convictions which prevented me from accepting a proposal (which was actually made but which fortunately never commanded majority support) to make unsatisfied pay claims a pretext for refusing to mark the papers of students. It is surely just as well first to make sure that disagreements with the policy of a closed shop do not necessarily involve the dismissal of an objector or, if he is dismissed, preclude adequate compensation.

Similarly with picketing: I confess I do not like picketing. The events of the winter before last have created a certain prejudice in my mind, but I certainly do not see any libertarian argument against peacefully conveying to one's fellows on the job the nature of a dispute with an employer. I do see at the same time that the liberty of secondary picketing, however it may be defended, is liable to grave abuse and therefore I welcome the opportunity of improving the law in this respect. From a perusal of debates in the other place, I infer that the present Bill is not yet immune from criticism in this respect, and I foresee much talk in Committee on this subject.

As for the financing of secret ballots, I confess I regard this as something of a bonus for the unions. I believe that a great many practise secret ballots already without subsidy, and it is certainly not compulsory. I do no propose to vote against it, and I very much hope that it does some good, although it does not evoke in my breast any acute enthusiasm.

The question of the relevance of this Bill was raised by the noble Lord, Lord McCarthy, and has been raised by several noble Lords on the Opposition Benches since then. The noble Lord, Lord McCarthy, pointed to the fact that there are all sorts of troubles confronting this economy which do not necessarily spring from the state of the law. Do I not know it! Have I not in this House protested against inflation both on the part of Conservative Governments and on the part of Labour Governments? There are many other evils which do not arise from the state of the law. This is where I differ from those who have spoken in Lord McCarthy's strain, because I believe the majority of the public believe that there are evils in the present state of the law, and I further believe that the Government are well advised to attempt to cope with them.

6.8 p.m.

Earl DE LA WARR

My Lords, my noble friend the Minister of State has given us a brilliant account of the main features of this highly sensitive and important Bill— certainly one of the most important Bills of the Session. The Bill is designed, as he said, to make a start in dealing with the present imbalance that exists in favour of organised labour at the expense of the employer. This imbalance has quite clearly gone much too far, particularly during the last five years when the last Government were in power. The Bill starts to tackle this problem and does so effectively, in my opinion, but it does it selectively and with a noticeable moderation.

I should like to make three general points first, in order to underline this point of view. First, it does nothing to tamper with existing trades union immunities. Clause 14 of the Trade Union and Labour Relations Act 1974 is intact. I believe this is absolutely right. We must deal properly with the fundamental question of bringing the trades unions back within the civil law; but there is no way that this could have been part of a Bill presented to Parliament only seven months after this Government came to power. The matter is far too complex and far too deep-seated. Instead, union immunities are to be the subject of a Green Paper which I hope will be issued before many months are out. I would ask your Lordships to remember that this was fore shadowed as long ago as last October, in the first consultative document put out by the Secretary of of State.

Secondly, the Bill is highly flexible. It leaves the Secretary of State with the opportunity to deal with matters as they arise by codes of practice, and these can be amended at any time. Each one of them requires prior consultation with ACAS and then an Affirmative Resolution by both Houses. So the influence of Parliament will be many times greater as a result, because it will have the power to approve, veto or amend whatever the Secretary of State proposes. Thirdly, the strength of the Bill lies in its attention to the freedom of the individual, whether he be the worker or the manager. They must, both of them, have more power to protect themselves against various forms of industrial abuse.

Turning to the detail of the Bill, I, like other noble Lords, want to confine myself to dealing only with the most important clauses— the closed shop, secret ballots and secondary interference in industrial disputes. In my opinion, closed shops are monstrous intrusions into personal liberty and a contravention of all the principles of natural justice. At least, my noble friend Lord De L'Isle and I agree with each other up to that point, although I do not think that our agreement goes very much further.

This Bill goes a long way to redressing the balance in favour of the individual worker, by protecting him from unreasonable expulsion from his union. If, as a result of losing his union card, he loses his job, the Bill will give him the right to compensation for unfair dismissal— something that was specifically denied to him by the last Government. The employer, if then sued by his employee for unfair dismissal, will in future, if he wishes, be able to enjoin the union in the case and let the court or tribunal divide any damages that may be awarded between the union and the employer— something that is exactly as it should be. Remember, my Lords, that this is a closed shop as a result of an agreement between the two parties, and it is the two parties who are at fault. Further— and this has been referred to more than once— the fact that a man now has only to show "conscience or other deeply held belief", is much fairer than the definition in the 1974 Act of "religious belief" only.

The Bill provides that there will be no new closed shops without a secret ballot and a very large majority in favour, so I doubt very much whether there will be any new closed shops. But how long will it take for the existing ones to wither, because this, in my opinion, is something that must happen. I think that, in due course, existing closed shop agreements will need to be balloted, too, but I would leave this alone for now. It would be an immense task and does not, in my opinion, at this time satisfy the test of practicality.

As to secret ballots, I have no doubt that a large majority of people in this country believe them to be essential. The Bill, as it stands, does no more than give the Secretary of State, through the certification officer, power to reimburse costs and it gives no clue as to how the machinery will work and in what circumstances. Once again, I believe that this is exactly right. The balloting question is par excellence a case for maximum flexibility by the use of codes of practice. If we were to put any sort of structure into the Bill now, I believe that we would be almost certain to get it wrong. But I know that everybody is looking forward to hearing, before too long, what it is that the Secretary of State intends.

I now want to talk about secondary interference with industrial disputes. The last Government made all secondary action, including picketing, legal; that is, immune from civil action. We bitterly opposed this immunity at the time and, my goodness!, how right we were. The events of the last two winters surely proved that beyond doubt. Secondary picketing is a social evil that we cannot allow to continue, at least on anything like the scale that we have seen in the last few years. The Bill provides that from now on an employer will have the right to ask for injunctions against any pickets who are not from his own workforce.

Of course, there are complexities here. Of course, there will be difficulties. There will, on occasions, be large numbers to contend with. There will be the problem of the revolving picket— here today and gone tomorrow. But, once again, this is a question of timing, a question of trial and error and of finding out how far we have to go to put things to rights. Once it is generally realised that secondary picketing is illegal and actionable, I believe that it will dramatically diminish and that is why I support the line that is taken in the clause.

As to secondary action rather than secondary picketing, which can really be defined as secondary blacking, it is not overtly so unpleasant to the public, but its economic effects can be very serious and, on many occasions, far worse. In any case, the recent judgments in the House of Lords made it absolutely necessary that the Government should legislate. My noble friend has made clear why a complete ban on all secondary action could not be made to stick, and I am totally persuaded by his arguments. So I believe that the Government have done the right thing in restricting immunity to as few people as is practically possible.

Certainly, immunity will not exist if secondary action goes beyond direct suppliers and customers of the firm in which the dispute exists. Even then it would have to be shown, if it came to an action for tort, that the secondary action was likely to achieve only its declared purpose— namely, to black the goods of the company in dispute— and did not have some other extraneous reason. Nevertheless, it has to be admitted that this is a difficult and complex clause and is likely to need interpretation, and possibly much interpretation, in the courts. But, like secondary picketing, once that process begins and it becomes clear what is illegal, then I believe that the provisions of the clause will be very effective and that we shall see a big fall in secondary action.

Despite all these arguments, there are union officials and, if I may say so, their political allies who say that the whole Bill is unnecessary and is unfair to the trade union movement and to the workforce alike. I will not waste noble Lords' time in contradicting them. This Government were elected by an overwhelming majority to redress some of the abysmal injustices of their predecessors' industrial legislation. A Bill was needed and a Bill is before us today.

Equally, there has been criticism that the Bill has come too late and done too little. I entirely disagree. The Bill reflects very clearly my noble friend the Secretary of State's wise understanding of the practical limits of legislation. We cannot legislate to change attitudes. Let us be quite clear about that. It is only when circumstances cause more realistic attitudes to prevail that we shall start once again to make industrial progress.

The results of the Leyland ballot and the massive rejection of last week's "Day of Action" certainly give me more than a glimmer of hope that good sense may be on the way back. But despite that, let us make no mistake about it: we are going to have a hard winter on the wages front and we are going to have to look for steadfastness on the part of the employers, both Government and private enterprise alike, and very good sense on the part of the trade unions. What folly if we were to wreck our chances by an act which bore all the signs of confrontation. For this reason, I judge the Bill to be a masterpiece of good timing and good sense. And if I may end on a personal note, with all my heart I congratulate my right honourable friend the Secretary of State for the militancy of his moderation.

Lord McCARTHY

My Lords, before the noble Earl sits down, I wonder whether he could answer this question. I am trying to follow his argument. If he accepts that secondary picketing and secondary action is unlawful but that it existed, for example, at the time of the miners' strike in 1974, and if he accepts that the 1971 Act did not prevent it, why should this Act prevent it in the hard winter which the noble Earl says is coming?

Earl DE LA WARR

My Lords, I am afraid that I was taken unaware by that question. I wonder whether the noble Lord would be good enough to repeat it.

Lord MCCARTHY

My Lords, the point I am trying to make is this. In 1974— indeed, from 1972 to 1974— secondary picketing and secondary action was unlawful; yet we had it, most notably in 1974 during the miners' strike. The 1971 Act did not prevent it. Why should this Act prevent it in the hard winter that the noble Earl says is coming?

Earl DE LA WARR

My Lords, I have not said that it will prevent it. I have said that in due course, when people realise that it is actionable and illegal, it will have a dramatic effect. We heard from the noble Lord a great deal of history about the 1971 Act. We have heard by implication that two Acts have produced some very unforeseen circumstances. I cannot foresee what is going to happen, but I am perhaps being more optimistic than the noble Lord, Lord McCarthy, when I say that I believe that the mood of the country is such that now this sort of legislation will bite.

6.24 p.m.

Lord KALDOR

My Lords, I think that the Bill before us needs to be examined from two different angles. The first— and it is one upon which the debate so far has largely concentrated— is whether it is likely to make a positive and a beneficial contribution to our industrial relations.

The second is whether it is likely to make an effective contribution to the Government's chosen short- and medium-term strategy.

As most of my remarks will be critical of both aspects, I think that I ought to make it clear at the outset that I regard the problem of industrial relations as one of the most serious and deep-seated in our society. At a time when class conflict and class antagonism have abated in most other Western countries, the feeling of alienation among our working class and their general sense of frustration seem to get worse. This makes them more conservative— with a small "c"— and more resistant to the introduction of changes in techniques, or of changes in working practices, and at the same time increasingly indifferent to the fate of the particular enterprises which employ them, an indifference which stems from the lack of any opportunity for participation in decisionmaking.

We have a complex and archaic structure of trade unions which is the result of a long-drawn-out historical development and a long series of struggles, proceeding in the face of hostility, and gradually acquiring freedoms, not in the form of positive rights associated with specific duties but in the form of immunities, of acts which under the common law are regarded as illegal and which are still so regarded by the courts. It is a peculiarity of our labour legislation that acts in restraint of trade and combinations in restraint of trade, which under old English law are regarded as criminal conspiracy, and are also actionable for damages under civil law, nevertheless give workers immunity if they commit these illegal acts in furtherance of or in contemplation of trade disputes.

These rights were acquired largely under two of our great political figures. It was Disraeli who gave them immunity from criminal liability and it was Campbell-Bannerman who in 1906 gave them immunity from civil liability. But precisely because they are given in the form of immunity from prosecution while still retaining their illegal character, they are subject to a constant process of erosion by the judicial process. I do not wish to go into that, but it places a fundamental uncertainty upon the whole question of trade union rights which I am sure my noble friend Lord Wedderburn of Charlton will, in his closing speech tonight, explain far better than I can.

I have little doubt that our inherited structure of union organisation and the "immunity" form of our labour legislation is a serious handicap to the workings of our whole economy. If we could start afresh, if we could be like the Germans who started with a clean sheet after their old union structure was completely smashed up under the Nazi dictatorship, I am sure that we could create a degree of social consensus and cohesion which exists in Germany but which is unattainable here.

I agree with a great deal of what the noble Lord, Lord Harris of High Cross, said about the German system of rights and duties, but I noticed that he did not remark upon the second leg, so to speak, of that system which consists of their system of social partnership and participation. Nor did I hear him mention that he personally thoroughly approved of the recommendations of the Bullock Report which recommended such a system for this country, which is an essential element of changing over to that system. All of us who observed the events of the early months of 1979 which have already been referred to by several speakers, when relatively small numbers of workers performing essential tasks went on strike in apparent total disregard of the harm which they caused to innocent individuals, and indeed to the wider interests of the working class of Britain— that these wider interests were harmed is best shown by the fact that noble Lords opposite would not be where they are now but for the events which occurred in the winter of 1979— could not be left in any doubt of the need for a basic reform of our labour organisation and our system of wage bargaining.

But it is one thing to state a problem; it is an entirely different thing to find the right solution. The Conservative Party, not so very early but some time late in the 1960s, convinced themselves that the solution lies in the curtailment of the existing immunities of the unions and in the curtailment of the umbrella of protection which they had under the 1906 Act. The first such attempt, the Industrial Relations Act 1971, soon proved unenforceable, and I think everyone would agree that it was put on the shelf de facto long before it was formally withdrawn.

By comparison the present Bill is a modest affair, but it is much less modest than the original proposals made in the Green Paper, and it has been considerably widened in scope in the course of its passage through Parliament, particularly since the insertion of a new Clause 16 at the Report stage in another place. Now we are told that this Bill is only the first in a series, and that there will be further Bills which will bring back other important features of the 1971 Act concerning the collective liability of unions for the actions of their members.

Earl DE LA WARR

My Lords, if I may interrupt the noble Lord, would he accept it if I were to tell him that in another place when the Secretary of State was asked during the course of the debate on Report, whether he would give an undertaking that the Green Paper would be followed by further legislation, he specifically declined to do so?

Lord KALDOR

My Lords, I am grateful for that assurance. The present Bill contains some good features and I think the noble Earl, Lord Gowrie, gave an admirable exposition in their favour. He made out a far better case than I thought it was possible to do and showed that there are features of the Bill which I personally would support if they could command a consensus and if they were enforceable. Those two things are largely coterminous, and if I do not support them it is for these two reasons. But apart from these the Bill contains many features which would cause resentment and annoyance and appear to have no justification other than a kind of nastiness.

To give one example, reversing the onus of proof in cases of unfair dismissal from the employer to the employee means that the employee would have to prove that he was unfairly dismissed instead of leaving it to the employer to make out a case that the dismissal was reasonable in the light of the facts. It is obvious that it is much easier for the employer to make out this case than for the employee to prove the opposite, so what is the point of it? What is the point of curtailing the rights of unfair dismissal and maternity benefits in the case of small firms when we know very well that workers need far more protection in the case of small employers than in the case of large employers? It is not Marks and Spencer and ICI and other large firms of that kind who are liable to welsh on their obligations as regards maternity benefits.

The Earl of GOWRIE

My Lords, I do not wish to interrupt the noble Lord except on a point of information. I think there has been some misunderstanding about the maternity clause. The reinstatement change is only for very small firms of three or four employees, and the onus is entirely on the employer to show that it is not reasonable for him to give that job back to the lady in question. Therefore, it must be clear that the onus is entirely on the employer.

Lord KALDOR

My Lords, I am grateful to the noble Earl for that information. But the very fact that he gave it shows that there was some point in what I said. However, I think more important aspects are the restrictions placed on picketing and secondary actions which are so strongly welcomed by several noble Lords on the other side of the House, and which we think are likely to prove a boon to lawyers because they open wide avenues to cascades of litigation. The wording and complexity of Clauses 15 and 16 provide a paradise for lawyers, in interlocutory proceedings to obtain injunctions, of which we have seen quite a number recently, some of which were upheld by the House of Lords although some were not. Such actions will be even more numerous as a result of these restrictions placed on secondary action and on "offside picketing" (if I may use that expression) which, as my noble friend Lord McCarthy remarked although illegal were not enforceable under the 1971 Act while that Act was in force.

If there are a large number of such injunctions the law faces an awful dilemma. These injunctions are frequently disobeyed by the workers or by the trade union officials, which makes the union official or the non-compliant employee open to criminal prosecution for contempt of court. But if the latter stage is not proceeded with, as was the case with an official of NATSOPA recently, then the only effect of these injunctions is to bring into disrepute public respect for the High Court. If, on the other hand, it is proceeded with, then in a large number of cases it is likely to cause sharp confrontation and fierce resistance, such as occurred when some dockers were gaoled under the 1971 Act.

In this connection I should like to draw the attention of noble Lords to a vivid and admirable account of the difficulties and absurdities which arise when workers and union officials are prosecuted for strike action. They have only to read the clear and concise evidence— it is only a page and a half, and it can be read in five minutes— given to the Donovan Commission by Sir Harold Emmerson, the war-time Permanent Secretary to the Ministry of Labour, and which related to his experience of an illegal strike during the last War in 1941, when the Kent miners went on strike at a time when such strikes were illegal tinder the emergency regulations.

The Kent miners were prosecuted, the union officials were given prison sentences and 1, 000 of the 4, 000 miners on strike were fined. The reason for the limitation to 1, 000 was that the resources of the law were not able to cope with more. Within a very few days the Secretary for Mines himself, the head of the Mines Department, went down to the prison in person in order to secure an agreement with the union official who was in prison so as to allow the mines to start operating again and work to be resumed, which required his consent. And here I quote from Sir Harold Emmerson: Apart from some face-saving words it gave the men what they wanted. Then the Secretary for Mines took a deputation to the Home Secretary to secure the immediate release of the prisoners who were condemned for three months or one month.

After their release the mines were reopened and in the first week the normal output of coal nearly trebled ". So the nation lost very little coal. The court was in addition advised from above by some higher legal personality not to enforce the fines, which were paid by only nine workers out of one thousand. For the rest, those who did not pay never had to pay. So everything was fine and rosy. Sir Harold Emmerson goes on to say that in the Ministry of Labour there was gloom and apprehension, if not despondency, as the remissions which were necessary to start the Kent mines again, essential from the point of view of the war, were bound to weaken the authority of the law. This was the difficulty with the 1971 legislation and will be the difficulty with the present Bill.

Is it possible to alter the balance of power between capital and labour by legislative action within the parameters of a democratic society? Legislation cannot be enforced by the courts if it does not carry the consent, explicit or tacit, of a large majority of the population. The ultimate sanction of the law is the consent of those who are governed by law. If labour has become too powerful in this country through organisation, that power cannot be reduced or eliminated by legislation.

There is no way of restoring the situation to what it was before trade unions were first established. We must go forward and not back. Going forward means seeking fundamental reforms through social partnership and co-operation, not through legislation and confrontation. Judging from debates in another place, I think that in the matter of trade union rights the party of the noble Lords opposite are like the Bourbons: they have learned nothing and forgotten nothing.

The question I should like now briefly to examine is how it will help the Government's short- and medium-term strategy. I set out in an earlier debate in this House my reasons for thinking that the Government's strategy can only succeed if what Sir John Hicks calls "real wage resistance" is broken; that is to say, if you can prevent the workers from obtaining or commanding rises in money wages that offset the rises in prices. In his concluding speech in the debate on 16th April, the noble Viscount, Lord Trenchard, indignantly denied that the Government had any intention of impairing the workers' ability to resist a cut in real wages. Yet last Friday, when the monthly figures of retail prices revealed that inflation is now running at 21.8 per cent. the Chancellor of the Exchequer, in an interview on the radio which I happened to listen to that afternoon, gave the workers' insistence on seeking full compensation for price increases in wage increases as the reason for the magnitude and the persistence of inflation. He said that the rise in the price of oil made it necessary that real wages be reduced— that is, that the standard of living of the working class be reduced— and that other industrial countries had recognised this and that in consequence their wage increases were several per cent. lower— I think he mentioned 3 or 4 per cent. lower— than price increases, which is not the case with us.

There were several things wrong with that statement. In the first place, Sir Geoffrey Howe forgot that we are producers of oil and not only consumers. Therefore, our real income per head, unlike those of Germany, France, Italy and others, does not suffer a diminution because the price of oil is rising. In fact when we reach the stage, after next year, where we have a net surplus of oil and are net exporters of oil, our real income per head should increase and not fall, as a result of every increase in the price of oil.

But the second and more curious error was that he was wrong on the facts concerning what happens in other countries. I have not had much time since last Friday to do extensive research, but for the six countries, other than the UK, for which figures are given in the National Institute Economic Review, the facts are that for the latest 12-month period— that is now up to the last quarter of 1979 as against the last quarter of 1978— the rise in earnings exceeded the rise in prices in the majority of countries; it exceeded it by 4½ per cent. in Italy, by 2½ per cent. in France, by 1½ per cent. in Japan, and it was virtually identical in the case of Germany and Canada. The one country for which Sir Geoffrey Howe's statement was true, was the United States, where earnings rose over the 12-month period by 8½ per cent., while prices rose by 13 per cent. But that is the one country for which his argument about oil was inapplicable, since, as everybody knows, the United States follows a policy of not allowing the rise in world oil prices to be reflected in domestic prices.

And what happened in our case? At the beginning earnings were rising faster than prices, but the rise in prices since last November has been much faster than the rise in earnings. The rise in earnings hovered around 19 to 20 per cent.— one month 19½ per cent., then nearly 20 per cent., between November and March, the latest month for which figures are available— whereas the rate of increase in retail prices went up from 17 per cent. in November to nearly 22 per cent. And most of this increase is largely attributable to acts of government, to taxes, charges, interest rates and so on, rather than increases in costs, either of labour or fuel, or material costs. But the effects of these price rises are by no means fully reflected yet in earnings. I expect that from now until the end of the present wage round the monthly figure for earnings rises will increase, so that by July and August you will find that the rise in earnings will be at least around 22 per cent., which is 6 per cent. more than it was after the complete breakdown of incomes policy and everything that followed from it at the end of the previous round last July/August. That July/August 1979 figure was only 2 per cent. higher than the corresponding figure for the previous wage round which ended in July/August 1978, despite the complete breakdown of incomes policy.

Whether the Government deliberately aim at reducing real wages or not, at least they now recognise that, on the economic strategy actually pursued, with falling output, falling production and falling employment, their policy objective of reducing inflation is quite unattainable without it. No amount of interest increases or fiddling with money figures or interest rates can possibly cause the rate of inflation to be reduced, let alone eliminated, unless real wages fall or unless they make a U-turn, adopt a different strategy and follow a policy of expansion, of increasing production and employment, and thereby increase the real product of the country so that real consumption can increase as well as real investment.

Whether their present Employment Bill will make a contribution to the rather miserable strategy, the monetary strategy, which is now followed remains to be seen. But, I doubt whether, in view of the modesty of its provisions and the fact that such provisions are not instantly obeyed— but rather, if past experience is any guide are ignored— it can be significant within the time-span of the medium-term strategy.

6.52 p.m.

Lord CARR of HADLEY

My Lords, as the Minister responsible for the introduction of the Industrial Relations Act 10 years ago, I am sure that your Lordships will understand that I have been under some temptation this afternoon to defend that Bill against some of the myths that have been built up around it. However, let me hasten to assure your Lordships that I intend ruthlessly to resist that temptation, great though it may be and particularly strong as was the temptation offered to me by the noble Lord, Lord Kaldor, at one point of his speech which we have just heard— another occasion, perhaps, but not today.

I wish strongly to support the Second Reading of the Bill before us today. I have my reservations about it, or some parts of it. I certainly believe that further instalments of legislation will be needed. However, neither of those considerations deflect me from the clear support which I wish to give to the Bill, and in particular my support for its step by step approach. Perhaps I may say to the noble Lord, Lord Robbins, that, with the wisdom of hindsight, I would perhaps agree that one— just one— of the mistakes which I made when I was the Secretary of State responsible, and perhaps which my predecessor Mrs. Barbara Castle also made, was to try to do too much at one go. There were reasons for that too, but I shall also resist the temptation to go into them tonight. However, I most strongly support the step by step approach at present.

It is also worth saying, and important to say, that I believe that it is incontrovertible that legislative action in this field has the overwhelming support of the majority of people in this country, and that includes the support of the majority of trade union members. I can see the noble Lord, Lord Allen of Fallowfield, whose experience, of course, we all know and respect in this area, shaking his head. With great respect I suggest to him that, like all leaders— whether they be industrial managers or trade union leaders— one can sometimes easily convince oneself that the view of the leadership is, in fact, the view of the majority of those whom one is leading, and that is not always right. For years now every conceivable inquiry into public opinion has shown that the majority of rank-and-file trade unionists do not agree with their leadership in certain major matters regarding the role of law in the area of industrial relations.

I think that if we are to judge this Bill we must put it in the context of our industrial relations policy since the war. Historically, we in Britain have had a good system of industrial relations and collective bargaining. But, in the 1950s it began to deteriorate in its performance. That deterioration became rapidly more acute during the 1960s— indeed, so much so that by the middle 1960s a Labour Government felt that it was necessary and advisable at least to appoint a Royal Commission to look into this whole area. Hence, the Donovan Report about which, perhaps, we do not talk as much as we ought, even though I certainly did not agree, by any means, with all that it said. Hence, too, that same Labour Government felt compelled to introduce their proposals contained in the famous or notorious— according to how one looks at it— White Paper called In Place of Strife, and to say to the country that the enactment of those proposals was essential in the national interest. The deterioration which caused a Labour Government to do that also caused my party, when in Opposition, to conduct its own inquiry and to produce the report, Fair Deal at Work, and then, when we came to power in 1970, to enact our Industrial Relations Act.

Neither the Labour nor the Conservative Governments took those steps lightly, or for fun, or for any doctrinaire reasons. Both parties— and both Governments of both parties in the 20 years previous— had resisted the use of law in industrial relations, and were only driven to believe in its necessity because of the serious and accelerated deterioration in the system of industrial relations which had previously served us so well— at least, so well comparatively with the systems in use in other countries.

I must, in passing, make a brief comment on the potted version of recent history of the noble Lord, Lord McCarthy. If the Industrial Relations Act did so much harm, why was it that the number of strikes fell so dramatically in 1971 and 1972 compared with the years previously? I shall not argue that it was due to the Industrial Relations Act, but such evidence as there is leads one to conclude that the strike record was not aggravated by the Industrial Relations Act.

Lord MCCARTHY

My Lords, I was arguing that it fell as a result of Donovan, and that it fell even sharper in 1975 and 1976 under a Labour Government.

Lord CARR of HADLEY

My Lords, I do not want to go into a long argument about the history, but I have all the strike figures here in front of me. I should like to ask the noble Lord why, despite what he has just said, after that very brief, apparent improvement, after the Labour Government came to power and repealed the Industrial Relations Act, the trend of deterioration in our industrial relations, including our strike record, set in again even more acutely, and with an even greater accelerating trend than before?— because that is what it did.

May I also draw the noble Lord's attention to the comparison which he made between the late 1970s and the late 1960s. He said that by the late 1970s the number of strikes— and I was glad to hear him give importance to the number of strikes, because it is a far better measure than man hours lost of the degree of ferment in industrial relations— had fallen to the relatively low number of 2, 000 or thereabouts. I must remind him that that was about the level it had been in 1968 which was judged so serious in the national interest by the then Labour Government that they felt compelled to propose legislation as detailed in In Place of Strife. So, we only came back to where we were 10 years previously, which was thought to be so serious.

He also said that there had been a change because far fewer of the strikes were unofficial and far more were official. But, with respect, if he looks at the record he will find that he is wrong. In both years, of course, the percentage of official strikes was very small, something like 3 per cent. to 4 per cent. at the most, but the percentage of strikes which were official was actually higher in 1968 than in 1978. If anyone believes that we have seen this transfer from unofficial to official action then really he is not studying the figures in the Department of Employment Gazette.

Lord MCCARTHY

My Lords, perhaps the noble Lord will give way. I do not want to lecture the House at this stage, but three points could be made very quickly in answer to the questions he has asked me. First, I think that he is using gross figures. The figures that I use when talking about strike numbers are almost always those which others use; that is to say, figures net of mining. If we take out figures for mining strikes we see that I am absolutely right; that right from the middle 1950s— even from the beginning of the 1950s— until the middle of the 1970s strikes rose about 25 per cent. to 30 per cent. a year net of mining. Mining is a special case.

Secondly, I never said that we had a switch from official to unofficial strikes. I said that the nature of our strike problem at the moment is the few large concentrations of strikes, which for the most part are official and which, for the most part, take place in the public sector. That is the issue of working days lost. Our problem now is working days lost. That is the economic cost of strikes; not strike number, which is to do with fragmentary small strikes which, for the most part, are unofficial.

Lord CARR of HADLEY

My Lords, this is all very interesting. I am at least glad that the noble Lord now wants me to take figures net of mining. I remember that when I used to do that in the late 1960s I was severely reprimanded for so doing— perhaps not by the noble Lord, Lord McCarthy, himself, but by most of those who support him on that side of the House and in another place.

However, it is the present and the future that matter. The fact is that our present system and structure of collective bargaining, which used to work well— certainly as well, if not better, than the systems of other industrial countries— is no longer working well or anything like as well as the systems in most other industrial countries. It has not succeeded in adapting itself to the enormous industrial and social changes of the last few decades.

Therefore, in important sectors of British employment— not, of course, in all— our collective bargaining has become chaotic in its results and in the atmosphere which it creates, or at least fails to solve. It is surely a vital national interest that we should develop a more orderly and stable system of collective bargaining in this country. We need to establish and to practice a new and more relevant set of rules governing the conduct of industrial relations, equivalent to the sets of rules of the type that they have in every other industrial country except ours.

The question is whether these rules should be established by law or by voluntary self-regulation. In other countries they are almost wholly, but not completely, established by law and supported by the law. In this country we have had the opposite tradition. In the British context I want to make it quite clear that I am in favour of doing as much as possible by voluntary self- regulation. We should legislate, not with eagerness, but with reluctance, and only as and when it is clearly necessary. Hence my support for the step-by-step approach, and hence also my support for the role given by this Bill to codes of practice, which I believe are potentially of the greatest importance.

However, I suggest that in the light of experience of recent years, no Government could refrain from some new legislation. My right honourable friend the Secretary of State and the present Government could not have done less than they are doing in this Bill. Many— probably the great majority (I am not just referring to the Government's supporters in Parliament but to the great majority in the whole country) — feel that the Government should, in fact, have done more. I personally believe that they are right to err on the side of doing too little at this stage, rather than run the risk of doing too much, But I really do not believe that they could have done less.

For example, after the experience of the last few years no Government could have failed to take some action about picketing. What we have seen in this country, from the days of the first miners' strike in 1971–72— repeated, not on such a massive scale, but in various important instances afterwards— is a total abuse of anything that trade unionists used to think of as picketing. It cannot be allowed to continue without the Government trying to protect the country from such abuse. Whether or not the measures in the Bill are exactly right, can, of course, be proved only by experience. For myself, I am doubtful whether my right honourable friend the present Secretary of State will find himself justified in putting so much weight on responsibility of individuals, and enforcement if necessary against individuals, and no responsibility on unions. But, there again, only time will show.

Equally, no Government could have neglected to act against the present, almost unlimited, scope of immune secondary action, as practised in many recent strikes and as supported as being immune under the present law by the recent decisions made by the judicial Members of your Lordships' House. I believe that proposals in this Bill are the minimum that had to be taken to meet this immediate situation, pending a much fuller consideration of the extremely difficult and complicated matters tied up in this whole field of trade union immunities, about which a Green Paper is promised in the near future.

Again, no Government with any respect for individual liberty could have failed to act to provide some remedy against the potential and, indeed, on occasion actual tyrannies of the closed shop, as permitted by Acts passed by the last Labour Government. I greatly and warmly welcome and support the reliefs and remedies offered by this Bill. I am bound to say that, as one of the few things I did agree with in the speech of the noble Lord, Lord McCarthy, 1, personally, perhaps have a natural prejudice in favour of the proposals for dealing with this problem which were included in the Industrial Relations Act because I believe that they guaranteed unions the stability of representation which they require and protected union members from what I understand to be the offensiveness of the "free rider", while at the same time giving proper protection to individual members who did not, for whatever reason, wish to join a particular trade union. But although I would prefer that, I warmly welcome the reliefs and remedies offered in this Bill.

I move to the next major point in the Bill. In the light of recent experience and of all the pressure in recent years for more industrial democracy, no Government could have failed to act to promote the greater use of secret and postal ballots. To talk about industrial democracy and not to do something to increase the use of secret ballots in the industrial process, is either idiocy or hypocrisy. Something had to be done in this field. My belief is that we shall have to go further than we go in this Bill; but this is a welcome first step, and, again, I think that it is better to start by doing too little rather than by attempting to do too much.

Here I strongly agree with the points made by my noble friend Lord Keith of Castleacre— whom I congratulate on his excellent maiden speech— and by one or two other noble Lords about the danger of legislating for compulsory ballots for strike action. In this country we do not believe in direct democracy; we believe in representative democracy. It would be a very dangerous mistake in principle to say that properly elected trade union leaders, acting within the rules of their unions, should not be free either to call a strike or to call off a strike without having a referendum of at least the members affected. I believe that we shall have to insist that where they do choose to consult their membership in that way, it must be done by secret ballot and can no longer be done by mass meetings and the raising of hands. I do not want to enforce a referendum every time, but it must either be done by proper leadership or, if they do wish to consult their membership, then I think that in due course we shall have to insist that it can be done only by secret ballot and not by the raising of hands at a mass meeting.

Lord KALDOR

My Lords, if the noble Lord will allow me, surely that was the case as regards the miners; their rules provided for secret ballots.

Lord CARR of HADLEY

My Lords, I agree. Let me be quite clear. Any person in your Lordships' House or anywhere else who imagines that ballots are always going to lead to there being no strikes needs to think again. That is not the point. The point is that where the membership is to be consulted they should be properly consulted. While I could perhaps criticise some aspects of the way in which the NUM conduct their ballots, I can only wish that all unions did the same when faced with that sort of situation.

I really believe that this Bill is a necessary, moderate step, and I hope that we shall proceed from here as much as possible by voluntary self-regulation and as little as possible by law. May I just say in conclusion how much I agreed with so much said by the noble Lord, Lord Rob- bins, about the principle of law in this field? The Opposition oppose this Bill at heart not because of the contents of this Bill but because of their belief that the law should not, indeed cannot, play an effective part in helping to improve industrial relations.

But if that is so, how do we explain the deterioration of our system before the Industrial Relations Act and since its repeal? How do we explain the experience of every other country? Of course I wish, like the noble Lord, Lord Kaldor— although not for the same reasons and not for the same cause— that we could have a chance to start from a new situation as West Germany did. But I cannot accept that because we were spared that, we must therefore do nothing and go on sliding down under our old system and must refrain from doing anything to change it.

Lord DAVIES of LEEK

My Lords, will the noble Lord give way for one moment?

Lord CARR of HADLEY

I really think I should not because owing to giving way I have already spoken for five minutes more than I meant to, and I am about to finish. The trade union leadership of this country, if they wish to maintain their present attitude on the acceptance of legal responsibility and liabilities, must answer some fundamental questions in a positive way. Why do they need these present unique immunities and privileges in order to do their job for their members? In other countries unions do not have them.

Lord DAVIES of LEEK

No.

Lord CARR of HADLEY

They do not.

Lord DAVIES of LEEK

Sweden.

Lord CARR of HADLEY

No, in Sweden they do not. They have certain important rights, and it is a basically different approach. If the trade union leadership of this country wish to carry the majority of the public with them, in a free country it is necessary for the trade unions like anybody else to either accept responsibilities which they have hitherto refused, or really explain to us in specific, concrete, positive terms why they need these immunities. Why do British trade unions alone need all these immunities at law to do their proper job for their members? And why, with all these immunities, are they less successful than the unions in most other countries in getting better pay and conditions, and a greater degree of participation for their members?

I do not believe that the law can on its own solve problems in industrial relations, but I believe it can help. I want, let me repeat as I close, as little law and as much voluntary self-regulation as we can manage, but I do not believe that we shall solve our industrial problems to a tolerable extent— we shall never solve them completely— until we have, by a gradual step by step process, provided ourselves with a framework of law based much more on a system of basic legal responsibilities and legal rights than the present wide and ill-defined system of legal immunities. In the end, freedom and good order exist under the law, or they do not exist at all.

Baroness GAITSKELL

My Lords, before the noble Lord sits down, may I ask him how can we possibly solve our industrial problems by continual and escalating unemployment?

Lord CARR of HADLEY

My Lords, I should like to embark on a debate on unemployment. I thought that the noble Lord, Lord Kaldor, was moving into that area of an economic debate, but I do not think that I had better follow him or the noble Baroness at the moment.

7.15 p.m.

Lord HANKEY

My Lords, I support this Bill so far as it goes. The objects it sets out to achieve are undoubtedly necessary, but that was obvious to everyone at the time of our general election in the spring of 1979, and personally I am deeply concerned that we should get this Bill only in May 1980. First of all, this Bill deals only with a small part of setting industrial relations on a proper and more equitable footing. There are many even more important aspects of these to be dealt with, and this is urgently needed if our inflation is to be corrected.

I can quite see that the Secretary of State does not want to try to do everything at once. That is a view that he is entitled and eminently competent to hold and express. But if we are to tackle this problem like an artichoke, pulling the leaves off one by one and not forgetting to eat each of them with a little emollient oil, we must try to see that the process is kept moving all the time. It is only four years before the next general election. Both sides of industry need time and certainty before they can get production going and really begin to steer this country away from the rocks. We have all the genius and the manpower and most of the equipment to do that, but at present any selfish, stupid, or Marxist-oriented pressure group can stop it, and can do so legally. That is dangerous nonsense, and I shall now explain why.

Inflation is basically due to too much money chasing too few goods. The Government are entirely right to correct the damaging monetary policies we have been suffering from. But, if industry languishes or recedes as a result of these and other factors, then production will suffer and inflation will not get any better for a long time. The experience of OEEC and OECD was quite clear in that respect. I really fear for the future if we do not take this very seriously.

There are of course many factors which impede production in this country, but, in my view and experience, difficulties over industrial relations are among the most important. The Labour Party have generally, with all respect, been more interested in problems of distribution of wealth than of production, and their nationalisation policies have not encouraged investment such as we require. In gross fixed capital formation the United Kingdom only comes equal twentieth in OECD, although we do better if we look only at machinery and equipment.

But our general performance is absolutely abysmal. In gross domestic product per head we now come seventeenth in OECD. There are only six countries poorer in income per head than we are: Turkey, Greece, Ireland, Spain, Portugal and Italy coming up now only one length behind. In 1965 we came eighth, and I repeat that we are now seventeenth. In income per head all the Scandinavian and Benelux countries, the French and the Germans and even the Japanese, now earn 1½ times or more as much as we do. They all used to be far behind. Incidentally, the United States has fallen to eighth place in income per head, although of course its economy is far the largest in OECD and it still represents by itself nearly 25 per cent. of the world economy. All the same, that it has fallen to eighth place is perhaps a factor one should bear in mind.

I always mistrust detailed figures of economic aggregates, and OECD statistics are not totally comparable in any detail as between countries, but the downward trend of Britain is really undeniable and certain, and it is most dangerous for this country in the long run.

Our economy has been shockingly mishandled, if I say so with all respect, by our successive inflations, by the inevitable industrial unrest they have caused, and by the most incompetent way in which we have handled industrial relations in recent years. I agreed with a great deal of what the noble Lords, Lord McCarthy and Lord Carr of Hadley, said in that exchange of views across the Chamber, but neither of them spoke much of inflation. If we have inflation, we automatically have shop-floor workers, and for that matter the white-collar workers too, very worried as to how they are going to make the grade, and this gives great opportunities for people who wish to stimulate trouble.

In the last five years we have had strikes by the most devoted and courageous people, including firemen, nurses and hospital consultants. The electricians not only turned off the electricity in the hospitals when doctors were working, but in one big hospital in London they pulled out the fuses and took them away. It is incredible that they should have been so ruthless. The sewage workers north of Manchester allowed sewage to get into the drinking water, which had to be boiled. The miners, by secondary action, prevented the electricity board from using its own coal stocks on its own premises. The dustmen and other essential services also caused strikes, which anybody who walked round parts of London will remember with horror. The Government simply must be able to look after the public interest better than that and I do not understand why the noble Lord, Lord McCarthy, seems to think that the Labour Party had such a good record on industrial relations. I would say they showed themselves singularly incompetent to look after them.

Of course we cannot make good industrial relations just by passing laws. But if we enact laws which allow anyone to create a dispute, stop production and break any contract anywhere without reasonable cause and with complete immunity, which is what we have now, then of course we hamstring production and damage the whole community. I recall the case of five Chilian aircraft engines. One trade union— I will not name it— did not like the fact that Señ or Allende had been got rid of in Chile, so they prevented those aircraft engines, which had been reconditioned by Rolls-Royce, from leaving the Glasgow area, and they were left out of doors for four years until they could be returned to Chile; but for some reason the Labour Party did not deal with the matter effectively. Can we expect to sell more aircraft engines or have more aircraft engines reconditioned in this country under those circumstances? Of course not. It is extremely damaging to trade, it hamstrings our employment and builds up every sort of ill-will and difficulty overseas.

I believe that a great deal of that was intended to be made possible when they drafted the law of 1974, which we here called the bully-boys' charter and which was passed over the dead body of this House. I believe that was certainly intended by Marxists in the Labour Party because, if they had not intended it, they could not have been so idiotic. I will give one instance. Look at the effects on the motor industry, where industrial relations have been among the worst in the country. In 1966 we produced 1–6 million cars in Britain. In 1972 it went up to 1–9 million. Since 1974 the figure has fallen steadily to just over 1 million and it may still be declining. But new registrations have gone up from 1 million in 1966 to 1–7 million in 1979; this vast difference is covered by imports. The figures I am quoting are from the Society of Motor Manufacturers.

Meanwhile, the French make three times as many cars as we do; the Germans nearly four times; and the Japanese nearly six times as many. The Ford Capri and Granada are now made in Germany and the Cortina is partly made in Belgium. General Motors, Renault and the Japanese are moving in. Does that look as though we were moving forward to industrial success or that our industrial relations have been effectively handled? I do not think it is possible to say that, and nobody can be proud of that performance.

My Lords, there is no future for this country so long as any contract can be broken with complete impunity; so long as collective bargains can, without breaking the law, be made collective swindles; so long as we pay out public money to strikers and their families regardless of whether they have acted in breach of agreements; so long as some people can refuse one job after another and still get unemployment pay or supplementary benefit, payments which are clearly inflationary; or, for that matter, so long as we have an inflation rate which forces men and women to strike in order to keep their pay in line with the rise in prices because their works agreements take no account of such inflation.

This is a controversial remark and it is meant to be, because this situation really needs thought. I am not just saying that we should have index linking, because the Treasury will not have it under any circumstances, but something has to be done about this so long as we have inflation at more than about 4 per cent. if anyone hopes to see better industrial relations. The man on the shop floor cannot stand high inflation unless somebody does something about it for him.

The Bill before us takes only a healthy nibble at the reforms that are required. We owe it to our children to carry the process of reform forward as quickly as possible, and this job must be finished at the very latest one full year before the next election. It will take 10 years to restore this country to prosperity, so we really must get on with it. When I say that, I am speaking on the basis of much experience in OEEC and OECD. It is a long and difficult job and it will be painful.

To conclude, I firmly believe that we have a great common interest in setting this country back on the road to success.

I believe the great majority of our countrymen see this already and that that was one reason for the change in Government which took place last year. I used to hope that sensible men and women of all parties would come to see this and co-operate; there are so many good and sensible people in the Labour Party and trade unions. But the Marxists, whose object really is to pull down the present structure, both of the state and of industry, have been allowed to get themselves on top. They are a suspect and dangerous Mafia and a poisonous element which vast numbers of our workers resent. I greatly hope that the provisions of the Bill will help true democratic elements in the trade unions to reassert themselves and I hope they will have the initiative and guts to do so. Of course, the Left Wing will not like it, but I hope that in the end the way may be cleared for the real co-operation in industry, and even in Parliament and Government, which our country so desperately needs on these issues which are vital to all of us.

7.29 p.m.

Lord HOWIE of TROON

My Lords, I join with those in all parts of the House who were impressed with the presentation by the noble Earl, Lord Gowrie, of the case for the Bill. He was able to show that the Bill was sensible in parts, and so indeed it is. He also demonstrated that there was a certain measure of public support for it, and no doubt that is true. But neither of those things means that the Bill will work if it becomes an Act. The noble Lord, Lord Carr of Hadley, showed that he was slightly irked by some of the unkind things that had been said about his measure, the 1971 Act, and I would say to him, and perhaps bring the smile back to his face, that some parts of that Act were sensible, too, and many parts of it were popular. Even so, I doubt that he would claim that that Act had worked spectacularly well. It may have worked a little, but it was not a wonder in all its works.

So, although this Bill might be sensible, and some of it might be popular, there is no certainty that it will work and produce the effect that the Government doubtless expect. Therefore the noble Earl and his colleagues should pay very close attention to the criticisms of the Bill which came from the noble Lord, Lord McCarthy, on the Front Bench in front of me, and perhaps more especially to the criticisms from the very senior and experienced trade union leaders who spoke from the Back-Benches here where I am now standing. These men know a great deal about the effects of law on the curious negotiations and relationships which trade unionism involves. A great deal of attention should be paid to them.

The noble Earl spoke of the "day of action" last week as embarrassing, and I am perfectly sure that he was right. It was possibly more embarrassing for us on this side of the House than it was for noble Lords opposite, but "embarrassing" is, I believe, the correct word to be used to describe it. But what lesson should we take from that embarrassment? The lesson we should take is that it demonstrated that the union movement was weak rather than strong, as the noble Lord, Lord Harris of High Cross, described it earlier this afternoon. He feared the trade union movement as some great strong monolith which would gobble up everything.

But if your Lordships cast back your minds to the winter before last, I think you will agree that the trade union movement then was unable to control its members when they were militant; and last week the trade union movement, for all its rhetoric, was unable to make its members militant when they were quiescent. So perhaps the strength of the trade union movement lies not in the structure, but in what members want to do. When a trade unionist appears after a meeting and is asked what are his opinions, very often he will say— and he is often made fun of for this— "I have to go back and ask my members." Very often that seems to be almost a catch phrase, but he means it, because the strength of the movement lies in the members, not in the leadership and not in the structure.

That leads me to wonder whether the Government strategy here is not wrong. They are trying to curb trade unionism with a variety of legal devices. I am not one who believes that there is no place for law in industrial relations— I believe that there is— but perhaps the Government should be trying to encourage the strength of the centre of trade unionism to ensure that the TUC is a power in the economic activities of this country, to ensure that the unions are strongly led and that they follow their leaders.

I believe that the Bill is quite likely to have the reverse effect, and that rather than strengthen the leadership of the unions— which the Government ought to be doing— it is more likely to encourage militant leadership, to make moderate leaders militants overnight, as I think the noble Lord, Lord Allen of Fallowfield, said earlier today. That is what is wrong with the Bill. The point is not that parts of the Bill are sensible and popular, and that taken by themselves they may be desirable, but rather that taken as a strategy they are mistaken and are likely to lead us in the wrong direction.

I do not want to speak for too long this evening; we have had a long debate. I wish merely to touch on two specific aspects of the Bill. The first is the matter of secondary picketing and secondary action. I am not sure that the Government's aim here is the correct one. When the noble Lord, Lord Carr of Hadley, was dealing with secondary action, he was most passionate not when speaking about the immunities or the possible economic effects of secondary action, but rather when speaking about the behaviour of certain pickets; and of course that is the case whether the pickets are secondary pickets, primary pickets, or are pickets of any number whatsoever.

In so far as picketing is objectionable to the people, it is not because of the immunities, which people do not worry about; nor because there might be financial harm or economic difficulty caused to an employer at a place somewhat remote from the trade dispute. What annoys people about picketing is the behaviour of a small minority of pickets; and it annoys them rightly because much of that behaviour is inexcusable. I am sure that no one on these Benches would ever attempt to excuse that behaviour. However, the point is that the Bill does not improve that situation. It is not aimed at the behaviour which is inexcusable. In fact there is already a whole armoury of legal provisions with which to deal with the objectionable aspects of picketing. Obstruction is illegal. Insulting language is illegal. Intimidation is illegal. Coercion of people is illegal. All these things can be dealt with, and should be dealt with. Yet the Bill does nothing at all along those lines. It merely follows a kind of dogma, and it aims at a target which is an illusion.

There is nothing at all wrong in a working man endeavouring to persuade another working man to come to his aid in an industrial dispute, even if that means encouraging that other working man to come out on a sympathy strike, to black work, or to do anything of that kind. There is nothing wrong with that so long as the man confines himself to persuasion. After all, earlier today the Foreign Secretary from the Front Bench opposite was demonstrating that he is taking secondary action in sympathy with the Americans. If the Americans are able, and are permitted, to persuade Great Britain to come to their aid, there can be nothing wrong in a working man persuading another working man to come to his aid—

The Earl of GOWRIE

My Lords, will the noble Lord give way? Is it not also true that the House of Commons is preventing my noble friend from blacking the commercial contracts?

Lord HOWIE of TROON

That is a long way from where we are today, my Lords, and I am not so sure that we should be too strongly guided in all things by what the House of Commons does; some of the time perhaps.

There is only one other aspect of the Bill to which I want to turn. It concerns one minor part of the closed shop agreement. The impact of the closed shop on professional workers poses a curious dilemma. It poses for some of them— I have in mind in particular professional engineers; I should confess an interest here, being one myself— a conflict between duty to a trade union in an industrial dispute and the duty owed to a professional organisation which has a code of professional practice. The kind of code that I have in mind generally contains provisions that members of professional organisations shall take no action which is inimical to public health and public safety. A little while ago the noble Lord, Lord Hankey, spoke of certain disputes involving sewerage services and so on where exactly that dilemma can arise, and in fact has arisen in the past.

If our professional man is obliged under a closed shop agreement to join a union, he might find himself in a situation where he has to choose between obeying his union and breaching his professional code. That is a situation which this legislation can deal with, ought to deal with, but has not dealt with. Perhaps the Government will say that there is some protection to be derived from the Bill in Clause 6, which deals with unfair dismissal. The suggestion there is that the member of a profession or organisation might have an objection to joining a union on grounds other than the religious ones which are now allowable. But that does not really go far enough, because it is quite conceivable that a professional man might want to join his union and still be able to fulfil the obligations of his code of professional practice.

The other defence which the Government might offer is that Clause 3, which deals with the question of unfair dismissal and compensation, will provide some protection for a professional man who has been thrown out of a union for disobeying it. Because he disobeyed his union in order to obey a code of professional conduct and lost his job on account of that, he could then be compensated under the unfair dismissal arrangements. But that does not answer it either, because what the man does not want is compensation for a lost job. What he wants to do is to keep his job and carry out his professional activity without having to face this conflict. I think the Bill should contain some provision to the effect that a closed shop agreement must contain a clause such as the one I am about to read out: No member who is a member of a recognised profession or organisation which requires adherence to a code of professional conduct as a condition of membership or of professional standing shall be required to take action in the course of an industrial dispute which is in conflict with the requirements of such professional membership or its code of conduct ". The idea underlying a clause of that nature is well understood by trade union leaders. During the inquiries of the Finniston Committee into engineering, a number of unions recruiting professional engineers and people of that sort were asked how they reacted to such a provision. Without fail, these leading unionists said that they accepted that there was a conflict or a possible conflict of loyalty, and it was a conflict which they would wish their members to avoid and be protected from. There is no doubt at all that these assertions on the part of these trade union leaders were sincerely meant and would be carried out at the highest level of trade unionism; but it is not quite the same when you are dealing with trade unionism at a local level, where the same level of responsibility is not always found. While the leadership of unions might behave properly in relation to professional men, it might not always be the case at the local level. So I think provision should be made to support such assertions by strengthening the law.

My Lords, that is really all I want to say on this Bill. I repeat what I said at the beginning, that while individual parts of it are sensible— and I have been illuminating one where it might be even more sensible than it is— I have no doubt at all that the strategy of the Bill is mistaken, because it will lead to strengthening those characteristics of militancy which we find among some trade unionists at the expense of the characteristics of moderation which we hope to find, and in fact do find, widespread among the unions.

7.44 p.m.

Lord DAVIES of LEEK

My Lords, most of us have sat through a long debate. They have been very long speeches. I will endeavour to reduce mine to half the usual length of the speeches that we have had today. That is not meant as a derogatory comment at all. The fundamental importance of this Bill has been such that I should have liked two days for the Second Reading rather than just one. It is tempting to deal with the clauses individually— and I have listened with care to every speech; I may slip out to get something to eat fairly soon, but I have listened to every speech— and I have heard the comments on each clause. I shall try to resist the temptation of evaluating some of these clauses, but will touch upon the philosophical purposes of this Bill.

The first question to ask is this. We have had all these marvellous economic and social facts given to us about the condition of Britain, but there is one outstanding one at the present moment. We have the highest inflation in Europe and the lowest pay. We will take that as the beginning factor. Will this Bill, when it becomes an Act of Parliament, improve the inflation situation or improve the pay of the people who are working? The answer to that is somewhere in the Kingdom of Heaven. The search for a failsafe system of society has been with this animal, man, since he left the treetops. We have not reached it even yet— and I have listened carefully, as I always do, to the noble Earl, Lord Gowrie, who presents his case brilliantly. No matter how bad the case is, his speech is always brilliant; and, as a consequence, we have to be very careful that we do not fall for the halo that shines around his black hair.

The oxygen of industrial happiness that keeps life going is a certain amount of security and full employment. Now this is why I interrupted the noble Lord, Lord Carr, who also always makes a constructive case. I was about to interrupt him, and now I will reduce the interruption by saying that the sad fact is that in Sweden, where we have had a social democratic system of Government pretty near to the socialists for 40 years, there has been a changeover to a bourgeois regime and suddenly, despite the prosperity and despite the happy flow, as those of us who have been to Sweden know, the whole thing has collapsed, or did.

The Earl of GOWRIE

They have settled now, my Lords.

Lord DAVIES of LEEK

I know, but I am hoping we will settle this Bill by throwing it out. The thing I am upset about is what this unhappy Bill will do. I was told by a noble Lord opposite that it is a masterpiece of timing— a masterpiece of timing when our unemployment graph is going up towards the top of Mount Everest and when our pay conditions are not meeting the height of inflation. I do not see this Bill being a soothing thing for industrial relations. I think this Bill exacerbates the present industrial situation.

I agree with the noble Lord, Lord Howie, though, that trade union leadership has the power to direct when it has been elected. I think the House has benefited today from two excellent speeches by two highly experienced trade union leaders, to whom it was a pleasure to listen; and, without expanding any more eulogies in that direction, I want to say that this is the mistake that the Conservative Government have made. You cannot pretend that the trade union movement, representing 12 million people, plus their families, which brings it up to 24 million people in Britain, can be neglected by Downing Street. Never mind the jokes about beer and sandwiches in the Sunday Express. The mentality of the trade union leaders of today is much higher than that of some of these journalists, who have made a hash of the newspaper world, anyway, with their strikes. I like them writing pontifical articles on Sundays or at weekends, knocking them out to fill a column, on how to run trade unions when they themselves have messed up the economy of the country with their own faults.

Consequently, I think that this Bill, if it becomes an Act, will increase the chances of unofficial strikes. I was glad that somebody mentioned Betteshanger. I I am old enough to remember the colliers down there. Some of my own people, miners and colliers, went down, some to cut coal and some to manage. But there are times— although we were at war— when, if the law is unfair, men will go to the greatest lengths to protest against it— and not just for gain but out of a sense of righteousness. Do not scoff at it! The Tolpuddle martyrs and others, with their self-righteousness, built up the movement and paid a heavy price for building it.

Mrs. Thatcher, the Prime Minister, has said (and the Employment Secretary of State has claimed) that this Bill, unlike the 1971 Industrial Relations Act, is not a measure designed to "clobber" the unions. That statement seems to be untrue; for not only do the changes proposed in the Bill represent a major attack on the rights of the trade unions, but the Bill is (and I note this in passing) only the first part of a wider programme of restrictive legislation forecast by Mrs. Thatcher. She has described it as a "start" and has already indicated that the Tories intend to introduce another Bill which will go even further in eroding the rights of the trade union movement. I had better say it now: If that is the intention, we will have more trouble on the industrial front than ever we have had in the past.

I am not making up this unwise statement. The lady is clever; she is charming— but she lacks wisdom. I have said it many times, and I have said it several times in your Lordships' House, that when the offer was made to Solomon to grant him the wish that he desired, he did not ask for cleverness; he asked for wisdom. It might be worthwhile, in the euphoria of their victory, for noble Lords opposite to remember that Biblical tenet.

The Employment Bill itself is, therefore, more than a limited measure; and many of these limitations have been expanded upon and explained by previous speakers. Consequently, keeping my promise, I do not intend to go into them in depth. We will have the opportunity to do that in Committee.

I want to take up another issue, one which has not been mentioned. The Economist this month says that budgeting is already in train in Government for increasing by 11, 000 the staffs in the Department of Employment and in the Department of Health and Social Security. Just at the moment when they are going to make a cut in these specific departments, they are, despite this Bill, increasing by 11, 000 the staff in these two departments. Why?— because, as the unions have pointed out already, for every extra 200 people unemployed, two extra clerks are needed in the social services; one in the Employment Department and one in the Department of Health and Social Security. Here is the preparation for the unemployment ahead.

The irony of this is that in the efforts to bring trade unionism to heel, the Prime Minister is generating bitterness in the hitherto most docile unions, those of the Civil Service. Says the Economist: The total [now in the Civil Service] is down to 705, 000 from 732, 000 when the Tories took over one year ago; the chop was announced for a further 39, 000 last December: and to keep to the 1980–1981 Civil Service cash limits, a further 15, 000 jobs must go— most of them to be arrived at by a new option for early retirement at 55 … We have reached a pitch where, as Mr. Alfred Kalin, adviser to President Carter, says: Anybody who isn't a schizophrenic these days just isn't thinking clearly ". This worries me very much. The Economist goes on: The Government's broad target does not distinguish between industrial and non-industrial civil servants. It is the 548, 000 non-industrial civil servants who measure the girth of the bureaucracy rather than the 157, 000 industrial civil servants, three- quarters of whom work in the Government-owned dockyards and arms factories, much of whose production is exported ". Here is my warning. Why have I quoted from the Economist? We are talking about arms, about selling arms abroad, about tanks and munitions. I listened to a debate in this House the other day and I got up exhausted and said, "I have been listening to pillars of clouds. We have not the manpower and it has not the peacefulness and industrial know-how at the moment." At this moment, when we need in the dockyards and in the munitions areas, first- class and peaceful conditions of work, we have Bills like this which come forward and irritate people in the key points of production.

The other point, the fall of 9, 000 industries in the first year was due more to the loss of orders from all over the world than to anything else. In this period when we are wanting maximum production, we irritate the industrial background with this kind of Bill. The Government are daily pounding the industrialist. He does not know where he stands. The CBI gave advice; and its advice (as the trade union leaders and others will tell you) was not 100 per cent. behind this Bill. The entrepreneurs in overseas services, in shipping and behind our hidden earnings, are worried about it as well as are the trade unions.

Last but not least, the women and the maternity rights which everybody has mentioned. I will not go into them in depth. We shall have the opportunity to do so in Committee. May I point out that there are now more women in paid employment than ever before in the United Kingdom. There are 9.1 million women workers compared with 13.1 million men. Women form 41 per cent. of the workforce. Although this growth is most marked in the United Kingdom, it is common to the entire industrialised Western nations. Not only are more families dependent on two wages but— and here is the point— more and more women have gained, and expect to retain, a degree of financial independence. Do noble Lords realise that the little cars, the holidays and the seaside resorts and—

Lord MOTTISTONE

My Lords, if I may intervene, is the noble Lord aware that the number of extra women in employment over the last seven years equals almost exactly the number of unemployed?

Lord DAVIES of LEEK

My Lords, I suffered from that because as a young man, my very highly intelligent mathematical wife was not allowed to work because she was a married woman; and this at the time when they wanted top-class mathematicians. That was pre-war. When war broke out, they wanted her to teach higher mathematics in the Royal Air Force. This is a short-sighted policy. I can remember the time when a poor retired policeman on about 28 shillings a week was called a rascal if after he had retired he stood outside a cinema for the pittance of a wage from the cinema proprietor. We must be careful about using that kind of argument. I did not expect a scion of private enterprise, with all the knowledge of the noble Lord opposite, to interrupt me about that and to say that women work because men are unemployed. He must not say things like that, because a lot of lumpen workers say that, too. As I have said, not only are more families dependent on two wages, but the increase in the number of employed women has not been matched by a decline in the traditional distinction between men's work and women's work. Women are concentrated in certain industries and particularly in low paid occupations. That is the point.

What am I driving at, my Lords? This clause is about small factories, where only six people work, not giving the same maternity allowances. Those women in the big concerns like ICI or working in shops like Marks and Spencer, have decent conditions. Are we wanting small businesses to return to the conditions of the 1900s? The sweat shops? Unless those little industries with only six or seven people in them are carefully watched women will be the sweated employment. That is what I am driving at. That is what will happen under this Bill. I have said enough, and I might as well, since everybody is looking tired despite the fact that I tried to wake them up, finish the speech.

I hope that we will get a reasonable opportunity spanned out over a period of days to discuss this Bill in depth, clause by clause.

8.1 p.m.

Lord RENTON

My Lords, the noble Lord, Lord Davies of Leek, is an old parliamentary colleague of mine. I have always enjoyed his speeches as much as the one I have enjoyed tonight. His speech ranged very widely but, if I may adopt a phrase we often used in another place, I hope that he will forgive me if I do not follow him in all his arguments because I have a few other things to say, though I will pick up some of his points on the way.

This Bill has my warm support. If it had gone even further towards implementing the Conservative Party's manifesto at the last election I should have been even happier with it. However, with confidence in the judgment of the Secretary of State for Employment and in the collective wisdom of the Cabinet, I accept that the Bill goes almost as far as could reasonably be expected in the first Session of this Parliament. I agree with the noble Lord, Lord Robbins, who said that in a matter of this kind it may not always be sensible to legislate at once right across the board.

As I seem to be the only lawyer speaking in this debate, I hope that it will not be taken amiss if I address myself to the question which has already been posed: "What part should legislation play?" That is, what part should it play not only in industrial relations— by which we all mean relations between the representatives of employees and management— but, perhaps even more importantly, in the relationship between trade unions and the people in general in our democratic society?

I agree that, as the noble and learned Lord, Lord Scarman, has been quoted as saying, in pay bargaining itself the law has not much, if any, part to play. But it is when negotiations break down, and when rough or damaging methods are used by trade unions or some of their members to impose their will in a way which conflicts with the interests of the community, that legislation must play a part. Even Labour Governments in the past have acknowledged that broad foundation proposition from which we cannot escape.

If I may say so with deep respect, there has from time to time been confused thinking on this question of the part that legislation can play. When some people— mainly on the Left— say: "We do not want the courts; we do not want the lawyers", they forget the interests of the community at large. Legislation of course has a part to play also, and it has played a long and honourable part, in protecting the interests of workpeople, whether or not they belong to trade unions. I cannot go along with the noble Lord, Lord Allen of Fallowfield— and I took a note of his words— who said: Reform will not come from legislation or the courts ". It surely must be accepted that legislation has a part to play.

Indeed, the last Labour Government thought legislation so important that they added 160 clauses and 23 schedules to the statute book; and very controversial much of it was, especially when it extended immunities from actions of tort, actions to which people other than members of trade unions would have been liable if they had behaved as members of trade unions have done. Also, they extended picketing rights, a closely allied subject. Indeed, in another place in opposition in 1974 we described the 1974 Act as "a militants' charter". I was amazed to hear the noble Lord, Lord McCarthy, speaking from the Opposition Front Bench, say today that that statute was necessary in order to reverse the decisions of the courts. I was not conscious of that at the time. We were not told so in another place except on a couple of points, if I remember rightly. If I may say so, I think that the noble Lord, Lord McCarthy, would wish to reconsider his suggestion.

Of course it was a militants' charter; it was also part of the social contract. We all know that the social contract ended in a wage freeze, and the social contract, as such, failed. What the militants want, it seems to me, is anarchy under the protection of the law, and that is what they received from the last Government in their legislation, besides some good legislation— genuine employent protection legislation— as well. It is that anarchy under the protection of the law which is the mischief which this Bill should largely cure.

But how far will it succeed? It will go a great way. Under Clause 1 the secret ballots which may be held for a wide range of things should help. I think that it is right that they should be paid for out of public funds if trade unions decline to pay for them out of their not inconsiderable funds. But I was astonished to read in the paper this morning that yesterday the Trades Union Council were urged not to hold secret ballots, using the opportunities given by this Bill. I find it very strange that Mr. Basnett and others should frequently on the one hand talk about industrial democracy and on the other hand show so little confidence in their members that they refuse to let industrial democracy work by secret postal ballots. I find that incomprehensible and even more incomprehensible when we know that it will not be costing them any money because the taxpayer will pay.

The other mischief which the Bill will cure is the protection given to secondary industrial action. It is a protection afforded at present mainly under the 1974 Act by granting immunities from actions in tort. The Bill does this in Clauses 15, 16 and 17. My Lords, surely this limited removal of immunities is clearly right. We do not go the whole way back to 1906, we are not trying to sweep away. Although there may quite well be a case for doing so, nobody is going to do it. Of course, the case for doing so, if I may state it academically, is that the 1906 Act was based on the assumption that, if the unions were sued in actions for tort resulting from strikes, they would not have the funds to pay the costs and damages. But that situation has passed long since. Some of the unions now have very big funds; they are among the biggest investors in the country; they can buy precious antiques and just keep them in a strong room until inflation increases their value. They are also among the principal supporters of pension funds and so on all over the country.

So the original reason for that immunity, the general one, could possibly be argued to have disappeared, but there is no intention, as I understand it, of sweeping it away, certainly not in this Bill. The intention is only to examine it and then we shall have the chance to discuss it when we see a Green Paper.

My Lords, I say in conclusion that we cannot restore what should be our great opportunities as a nation without a partnership between the trade unions and their members on the one hand and the Government on the other. So many of the union members, not only the last time but on many previous occasions, have voted Conservative. I stood myself— I am happy to say, successfully— in 10 General Elections and had a majority of never less than 5, 000 in a large constituency. I could never have won one of those elections without pretty massive support from members of trade unions, or at any rate weekly wage earners who were not members of trade unions, and their families. I could not have done so, and therefore I am grateful to them.

But co-operation with the unions does not mean— and the Government made it clear in their manifesto that it should not mean— that the Government should interfere with pay bargaining. That gets me back to a point I made earlier: there is no place for the law in pay bargaining as such. What it means, this need for partnership and co-operation, is that sensible, moderate trade union leaders should be encouraged in their leadership. This means having a legal framework which enables moderation to defeat militancy. One day perhaps the right to strike will cease to be abused. We shall never abolish it. It would not be right in a free society to do so, but it is not the best way of deciding things. Indeed, I think sometimes it is almost as senseless as duelling used to be for settling private disputes. My Lords, it is because I believe sincerely that this Bill improves the legal framework which we must have that I trust it will have your Lordships' broad support.

8.14 p.m.

Viscount MASSEREENE and FERRARD

My Lords, I am very pleased to follow my noble friend because it is perfectly true, as he said, that industrial relations must largely be governed by law. I welcome the Bill but I would greatly prefer that it had a few more teeth in it. We have been told today that the excuse is that the 1971 Act did not work. That is so, as it turned out. But we are now in 1980. I feel that after their experience in the two winters of 1978 and 1979, when they saw corpses not being buried, hospitals with the electricity cut off and such horrendous things as that, probably the public attitude has changed. The majority of members of unions, I think, are moderate. I was surprised by the speech of the noble Lord, Lord McCarthy. I always thought he was a moderate, but he spoke like a militant; he was completely unconstructive. He tried to tear the Bill to bits, but of course he did not succeed.

I am not at all anti-union. I have had to deal with shop stewards and, in a small way, I have had to work with members of unions; but I have always objected— and I say it again, as I have said it in this House fifty or sixty times over the last 20-odd years— to the unlimited power and immunity from the law, unknown in other countries of the closed shop. This has always seemed to me, and in fact to most reasonable people, to be an infringement of the liberty of the subject. The power the unions now have in this country would have been all right, no doubt, at the turn of the century when the worker had to be helped. Then the employee had to be helped vis-à-vis the employer. But their power is now too great. That is certainly my opinion.

What is the cause of our industrial decline? It is not because we have no brains. We have the finest inventors in the world; many of our factories have very modern machinery. But I am afraid the main cause arises from the large annual wage rises, without any increase in productivity, allied to frequent damaging strikes and "go-slows", and the tendency of unions— this is very important— not always to honour their productivity agreements and agreements in general. We lose a great many orders because of that. I am now thinking of ships, in particular. We have lost a great number of shipping orders simply because a man having a ship built, especially a foreign owner, cannot get delivery on the date he wants, because the unions frequently do not honour their obligations and agreements.

I remember asking this House a few months ago what the Government would do if we had an oil blow-out in the North Sea. They had no answer at the time; but I was glad to see a few months afterwards— not that it had any bearing on my question— that we had a fire ship arrive. It cost a great deal of money and it was built in Japan. Of course that ship ought to have been built here; but that was not possible because we could not give delivery on time. Delivery would take two or three years longer and the ship would be more expensive.

Another fire ship is being built in Finland. This order too, ought to have gone to our yards. It has gone to Finland because our shipbuilders were quite unable to guarantee a delivery date.

My Lords, I should like to refer very shortly to one or two clauses in the Bill. Clause 1 refers to ballots. I quite agree with my noble friend who has just spoken. I think we ought to have secret ballots. Often trade unions have had ballots. But if they are really to be secret I fear the only way is to have a postal ballot to the members' homes. I think a secret ballot cannot otherwise really be guaranteed. Public funds should only be utilised for postal ballots. I am all for having open- air meetings, still, with hands being raised and all that. They should not be stopped, but I think that to have a secret ballot it must be a postal ballot.

One reason why I should like to see secret ballots concerns the election of union officers and the amendment of union rules. Your Lordships will know, I am sure, that the elections for union officers usually take place late at night after the AGM, when most members have gone home. In fact, I believe there have been instances where members' votes have represented only about 5 per cent. of the membership of the union. If there were postal ballots for those elections, I am quite sure more moderates would achieve power— of course, there are some moderates in power now— and it would eliminate most of the militants. I heartily agree with that clause.

The other clause I should like to refer to is Clause 2, concerning codes of practice. As I understand it, the codes of practice are to go before both Houses of Parliament to be either accepted or rejected. But ought not Parliament to have the power to amend these codes of practice? Surely that would be better, because if Parliament cannot do it, then who can? The CBI and other organisations cannot do it: only Parliament can do it. I think it would be far more fair for the liberty of the subject.

I should like also to say something about Clauses 3 and 4, which cover the closed shop provisions. There are deep personal convictions about unfair dismissal within a closed shop situation. These two clauses, of course, give the right to compensation for unfair dismissal where there is a closed shop, and they allow for a deeply-held personal religious conviction in such matters. One has always been able to opt out in such a case if one pays to a charity of one's choice the equivalent of the union dues. I quite see there is going to be a lot of argument as to whether one's conviction really is an honest one, but as regards the tribunal I think the Bill well sets up the machinery. However, as I say, I am convinced that this may lead to qutie a lot of difficulties.

I have said often before that the situation would be much easier if we adhered to the European Convention on Human Rights, as other countries in Europe do, so that we did not have the closed shop and if everybody was free to join, or not join to, the union of his choice. If we had that situation, then it would be only fair that a person would have to pay the equivalent union subscription into a charity of his choice, if he did not join a union. I believe that unions might even find an increase in their numbers; but the closed shop seems wrong— it is definitely against individual freedom and against human rights. Also, you get many abuses of power under the closed shop situation; and it is primarily responsible for the artificial inflation of wages, because barriers are erected in various employments.

I should like to congratulate the Government on Clauses 5, 7 and 8. Here the employer no longer has the burden of proof put on him; he does not have to prove his innocence if an "unfair dismissal" is involved. It is up to the tribunal to decide. It appears to me to be a complete reversal of British law that the employer should have had to prove his innocence and was instantly the guilty party— rather like the law in France.

The most important clause, I believe, is that on secondary picketing. After all, secondary picketing, in the last large strike we had, held up exports and delayed imports. I have perhaps not read the Bill fully, and I am afraid I could not hear all the opening speech of my noble friend as I was unavoidably delayed. What I am not sure about as regards secondary picketing is the question of who is the subject of an injunction. For instance, I understand that an employer whose works are being secondary- picketed could apply to the court for an injunction under the Civil law. However, when he applies to the court for, and gets an injunction, I do not quite understand whether it is against the union or against the pickets as individuals. If it is the latter, the employer will have a very busy time running backwards and forwards to court, because he may perhaps get an injunction in respect of eight or ten pickets, and then eight or ten new pickets will turn up. Surely that process could go on and on.

The Earl of GOWRIE

My Lords, perhaps it would be helpful to the House if I were to clear up my noble friend's query at this point rather than later. An employer can seek a High Court injunction to ensure that the activity ceases. In order for it to be stopped the injunction has to be taken out against a person; but if he should approach a secondary picket and that person facetiously gives, say, the name of my noble friend, or whatever, he can then proceed against the organisers of the activity, up to and including the leadership of the union involved.

Viscount MASSEREENE and FERRARD

My Lords, I thank my noble friend for that explanation. I understand from that in fact that it is the union— is it the union which will have the injunction against it or only the union leader?

The Earl of GOWRIE

My Lords, the union leader.

Viscount MASSEREENE and FERRARD

My Lords, I thank my noble friend. I have almost finished, but I should like to take just 30 seconds more. I understand that in Germany— it is chiefly in Germany— when the unions put in a pay claim they put it in at 5 per cent. under the inflation rate at the time. It is a great pity that unions here cannot follow that custom, because if they did that inflation here would begin to fall.

I understand that that is done in Germany because they realise that there are various things, such as the cost of oil, over which they have no control, and that if they put in a claim which is the same as the level of inflation, they will only increase inflation. There is a lot that we could learn from German industrial relations. That applies also to France, where the closed shop is illegal. I welcome the Bill, and I hope that it will go some way towards improving industrial relations.

8.31 p.m.

Viscount ROCHDALE

My Lords, I think that I have listened to every word that has been said during the debate today, and I have certainly found it extremely interesting. So much has been said about the various points in the Bill, some favourable and some very critical. That being so, I shall resist the temptation to deal with detailed clauses of the Bill; that can come out in the Committee stage. What I want to talk about is something which I regard as very important; that is, the general background to the whole Bill and the main subject matter that underlies it.

As other noble Lords have said, it is a great human question as to whether those in employment, whether employed in management or employed manually, whether employed in service industries, manufacturing industries or otherwise, can get on together. That is the great issue. So much has been said over the years about industrial relations, sometimes rather ill-understood— though certainly not in your Lordships' House— that this is a subject which transcends everything else that we have to consider. Unless we can arrive at a really good spirit within our employment activities, and unless there is really good team work, we shall not be either creating or conserving the wealth needed to pay for all the other home affairs matters that we have discussed in your Lordships' House.

We have had a number of very important Bills this Session on education, health, social security, defence and so on. Unless we have a team spirit, the efforts which are needed to make those Bills— the Industry Bill, the British Aerospace Bill and the rest of them— and those activities a success will be blunted and we shall not make progress. I give that very quick background to the Bill, because it is all too easy when considering this matter, when considering the difficult legal and other details, to lose sight of the wood for the trees, and to lose sight of what we are really trying to see.

In the course of his speech, the noble Lord, Lord McCarthy, used the word "negative" in relation to the Bill. He may be surprised if I also use that word "negative" in relation to the Bill, but not in the same way as he did. I use the word "negative" as no criticism whatever, either of the Bill or of the Secretary of State, but rather as a very sad reflection on the present unsettled industrial climate, which sometimes makes the negative approach absolutely unavoidable.

I use the word "sometimes", because that raises another important matter which we want to remember. It is far too often forgotten or overlooked that, certainly in manufacturing industry, an overwhelming majority of industry— whether measured in terms of individuals or even more, in terms of manufacturing establishments— never resort to strikes. Their work goes on smoothly. Therefore, it is only to a relatively small number of enterprises, where, regrettably, good industrial relations break down, resulting in strikes, distressing examples of picketing, the consequential and sometimes unhappy impact of the closed shop and so on, that so much of this Bill is directed. It is to only a small part of the whole issue that the Bill is directed and all the rest goes on fairly smoothly.

Admittedly, these breakdowns and troubles which so often affect the great nationwide industries— and it is those which hit the headlines and which the public hear about and get mesmerised by— have an impact which can be very damaging, even though there are only a small number of industries concerned. But the smooth and happy daily running, as well as the successes, of the medium and smaller firms— and to be fair, also, of some of the very big firms— are not heard about. They do not appear in the press, because they are not news.

We cannot entirely blame the media for that. They are commercial enterprises and have to play to their market, and to highlight what they think excites their market. But the fact remains that the public and, even more seriously, our friends and customers overseas, receive a picture of British industry which I believe to be out of focus, and dangerously and infectiously emotive, when what is needed is a very clear picture of the true position in our industries. That is essential if we are to be able to assess a Bill such as this and to decide whether it is too little or too much. So much for the negative aspect.

I want to refer to one clause which is a very definite and positive one and which, in particular, I very much welcome. That is Clause 2, on the codes of practice. So much has been said and written about industrial relations by individuals, organisations and so on, that a clear distillation of all this experience that can, with common consent, be produced must be to the good, and that is what I hope the codes of practice will be. I am, however, particularly glad that the production of these codes is to be on a continuing basis, and that failure to observe any of their provisions shall not in itself create any liability for proceedings.

After all, codes of practice can only provide very useful guidelines. They will not necessarily result in good industrial relations. Good industrial relations, which is the main objective, can come only from the people within the industries concerned. They cannot be imposed or legislated for by Government. Government can certainly help. They must do a certain amount in that way but they can blunt, if they go too far, and that is even worse.

Some of your Lordships will have heard the debate in your Lordships' House on 8th May on the Defence Estimates. I was particularly interested in something which was said by the noble and gallant Lord, Lord Harding, who sits on the Cross-Benches. He made a point which is extremely relevant to what we are discussing this evening. At column 1803 of the Official Report he expressed the hope that the concept of "two sides" in industry, as he put it, would never be incorporated into the armed services. To quote his exact words, he said: Any tendency or trend of the slightest extent to apply that same practice to the armed forces would be disastrous ". Of course, one agrees with the noble and gallant Lord, in the context in which he was talking, but I would go further and say that industry has something to learn in this context from the armed services. What people have got to learn, somehow, is that there is the need for an identity of interest within industry, on all sides. In industry, particularly in medium and smaller firms, one can see this identity of interest, all pulling together. But too often— I believe through the incidence of history— there are divided loyalties, pulling in opposite directions. We see union loyalty given priority over company loyalty. I find this extremely difficult, in theory though possibly not in practice, to understand. It is difficult to understand when it is the company which in the end provides the livelihood for all those engaged in industry and which indirectly provides the cash that the union needs in order to exist. This is not "union bashing" but, I believe, common sense.

To a visitor from outer space, coming here unaware of our industrial history, we must at times seem to be almost suicidal. One can almost hear them saying, "In your games— cricket and rugger— you make sure that the eleven or the fifteen all pull together as one man, and you even do that with your defence services; but when it comes to your livelihood, and that of your families and dependants, to say nothing of your country, you have produced an inbuilt mechanism so easily triggered off that it will pull the enterprise to a standstill".

Our present system of trade unions and industrial organisation has taken over a century to build up. It is deeply embedded in our thinking. Possibly we cannot imagine anything very different, except perhaps changes in detail and by way of constraint, whether on employer or employee. But can we really look with any feeling of comfort at the prospect of that ding-dong battle— with one party doing one bit of legislation and another party doing another bit of legislation— going on for another century? If we are going to achieve any significant change of direction, which to my mind we must, it can be achieved only by general consent, and step by step. I believe that the implication of that is that we have to come back and think very seriously about participation. Perhaps this has now become slightly out of fashion, but I have always been keen on participation— right from the top to the bottom.

I apologise to my noble friend Lord Carr of Hadley for referring to the 1971 Act. I have always felt that that Act went far too far and far too quickly. I hate to say this, but I have always felt that it was doomed from the outset. The present Bill is far more modest. Indeed, it is criticised by some, though not by me, for not going far enough. Personally, I believe that the Secretary of State, even if he has stiffened up the provisions on picketing and immunity, has been right to stick to his line.

I regard the Bill as a holding operation, not as a beginning, to deal with some of the worst abuses of the present employment law. However, a great deal more will be necessary, not so much by legislation but even more between management and unions, between the CBI and the TUC. One thing, however, seems to me to be most important. In this wholly emotive issue, calling as it will, for a very long haul stretching over the lives of a great many Parliaments— not merely this one or the next— one thing is essential: that we should try to keep the temperature as cool as possible.

With that in view, dare I suggest— it has not been suggested, let me say straight away, in the debate today— that oppositions (I use the word in the plural to show that I am not particularly referring to the official Opposition) should resist the temptation to give notice that when next they are in power they will immediately repeal the relevant Act; and, equally, that parties in power will recognise their need to do everything possible to avoid the provocative. I believe that that is not appeasement but common sense.

Circumstances will change— with us indefinitely. The circumstances in industry within which we shall have to operate will be changing. I need not itemise them; your Lordships will recognise them as well as I do. Some change in legislation will be needed to meet those changes. But when it is necessary, do let us try to build upon and not merely knock down what the last Government did so that we do not always have to start all over again.

In speaking as I have done this evening on the broad background, as I see it, of the Bill, I have had very much in mind what the Secretary of State himself said in another place on 17th April. Perhaps I may conclude with a very brief quotation from what he said, because I think it is very, very important. He said: Reform of industrial relations law is necessary, but in itself it is not sufficient ". He then went on to say: So the solution is not to be sought only by changes in industrial relations law, important as they are … The fundamental improvements in our industrial relations institutions, procedures, attitudes and working practices which we are all seeking will be the work of years, requiring patience and determination ".— [Official Report, Commons, 17/4/80; col. 1503.] I interpret those words as meaning patience and determination, not so much in legislation as in the actions of everyone on every side concerned with industry. It is against that background, and prospect, that I wholeheartedly support the Bill.

8.47 p.m.

Lord SPENS

My Lords, I shall not keep your Lordships very long, but I am one of those recently mentioned by the noble Viscount who has just sat down who criticised this Bill for not being strong enough. Of course I shall support it in its passage through the House but, like my noble friend Lord Harris of High Cross, I will seek to amend it in certain clauses, or to persuade the Government to consider some amendments.

I accept that there is a right to strike, even though that right is not embodied in any law but is only an immunity. But it is not a paramount right. Nor is it superior to other rights, in particular to the right of ordinary men and women to work, whether or not they belong to a trade union. Yet the present immunities, especially after the latest judgment coming from this House, have made the right to strike paramount. I believe that those immunities must therefore be restricted.

A group of Members of this House has been looking at the Bill, not from the point of view of either industrialists or trade unionists but from the point of view of the ordinary man and woman. We do not think that this Bill goes far enough, it is a matter for concern that at present it is possible for a major official strike to be called when the support of those involved may be in doubt. A number of unions already have provisions in their rules making a ballot of their members obligatory before a strike. In other cases, the holding of a ballot is discretionary. In others, there are no provisions about ballots in the rules ". I have been quoting from the document which has been mentioned several times in this debate, the famous document, In Place of Strife, and that quotation goes on like this: The Industrial Relations Bill will give the Secretary of State discretionary power to require the union or unions involved to hold a ballot on the question of strike action ". That was the policy of a Labour Government 11 years ago, although it did not remain their policy for very long. We do not want to go as far as that in the case of ballots. We realise that there are great difficulties, although not insuperable ones, in legislating for statutory ballots, but we think that at the least legislation should be made giving the workers a statutory right to ballot if they call for such a ballot. So we shall be looking at Clause 1 of the Bill to see whether we can produce a suitable amendment.

Again, looking at the Bill from the point of view of the ordinary man or woman, we do not like the present powers of the closed shop, especially now that the Commission for Human Rights has referred the case of the three railwaymen to the European Court of Human Rights. My noble friend Lord De L'Isle has dealt with this point, so I shall not take it any further and I hope that my noble friend Lord Orr-Ewing will deal with some other aspects of the closed shop.

There are other points which are not satisfactory. The small businessman is deeply afraid of the implications of the Employment Protection Acts. I see the noble Lord, Lord McCarthy, sitting on the Front Bench and he has told me on several occasions now in the Select Committee that small businessmen have nothing to fear from the Employment Protection Acts; but the trouble is that those Acts are much too complicated. Even after this Bill has been passed there will remain two Employment Protection Acts, that of 1975 and the Consolidation Act of 1978, which between them have 221 sections and 30 schedules, with a total of about 340 pages. How can any small businessman think that he can disregard that bulk of legislation? So I believe that, if there is nothing for small businessmen to fear, we ought to produce that in some form of publicity which will be simple for the small businessman to read and understand. We also do not think that the clauses on picketing go far enough, but again I will leave that to my noble friend Lord Orr-Ewing.

I have not mentioned Clause 2, the code of practice. It is difficult to comment on this until we have seen a draft of the code, but the deterioration of industrial relations between management and employees is great and is one of the major causes of industrial unrest and strikes, and I believe that management is mostly to blame. I believe that, with a few remarkable exceptions, they fail to communicate properly and effectively with their employees, and I hope that the code of practice will contain sufficient guidance on this point to make industrial relations a little better. It strikes me that there is an opportunity here for entrepreneurs who have the knowledge and the experience to set up specialised consultancy firms to advise management on this subject. I do not propose to go any further tonight but I give notice that I and a small group will be tabling some amendments and we shall try to argue about them at the Committee and Report stages of the Bill.

8.56 p.m.

Lord GISBOROUGH

My Lords, over the years unions have built up power and immunities that may have had their origins in necessity, but in recent years we have seen those powers thoroughly abused by union leaders, frequently pushed on by minority groups of militants, often elected by highly questionable if not corrupt voting systems. Some constraint on union licence is therefore absolutely necessary. It was promised by ths Conservatives and it will be thoroughly welcomed, above all, by the workers themselves.

The first clause of this Bill is about balloting, and one really cannot understand the objection to the fact that a union will now be able, if it asks for them, to have Government funds to hold a secret ballot. If secret ballots existed at the moment and it was proposed to do away with them, can one imagine the fuss that there would be about it?

With regard to picketing, the Bill restores the right for an employer to seek an injunction to restrain a person from secondary picketing. To my mind this fails on two counts; first, that it may take a brave employer to venture into a crowded picket line to ask for a name, and it is highly unlikely that the correct name will be given— more likely, "Mickey Mouse". It will of course also be almost impossible to separate the primary from the secondary picket, or from those legally holding a demonstration there, all milling around together. Having taken the name, the person who is asked will say that he is not picketing but only demonstrating— and that he is allowed to do under this Bill, as close to the picket lines as he wishes. Therefore, not only should demonstrating be made illegal within a short or a specific range of a picket line but it should be the union that is held responsible for secondary pickets and not the individual, who may well, as has been seen in the past, be courting arrest and imprisonment in order to be held up as a martyr.

The unions can and do fine and discipline, and even take away the livelihood of people who work when they are told to strike. They can as easily fine and discipline those of their members who strike when they are told to work or who "secondary picket" when told not to do so by their unions. If the unions do not discipline their members, it can reasonably be assumed that they are condoning and are therefore responsible for the actions of their members. This is the most important omission in the Bill, and I hope it will be amended before leaving this House.

There also appears to be totally inadequate provision to deal with the excesses of the closed shop. I was glad to hear that this Bill will now bring the law into accord with the human rights legislation, but I think this Bill should be further tightened up to protect the individual. Most people just want to get on with their jobs, and many join a union only because they are compelled to do so. But they are certainly not prepared to waste a lot of their spare time in the evenings after work at long and political union meetings, where the agenda is designed to drive away the ordinary bloke by means of a long and boring agenda. Needless to say, when the unions then take decisions in the names of all their membership, they are doing nothing of the kind but only speaking for a small number of union activists. As new closed shops under this Bill have to be agreed by ballot, I believe that all recent closed shop agreements should be subject to a secret vote of agreement by the members, and I hope there will be a suitable amendment to bring that in.

The business of blacking can be as damaging as picketing. I think it is Clause 15 which deals with the example of SLADE, where the goods from a company were blacked by the workers of another company to force the members of the first company to join their union. It is not clear whether the injunction to deal with this that will now be available is also only capable of being served against an individual up to the union leader, or whether it can be served against the union itself as an organisation. To punish an individual, whether a worker or union leader, can only lead to martyrdom. To fine a union seems far more effective, more apt and relative to the damage done to an industry. Perhaps the Minister will elucidate on this point.

I was up in Scotland at the weekend, which is not noted for its Conservative support, and one quite ordinary worker told me, "We elected the Government, and for some of us it was the first time we had not voted Labour, to put the boot into the unions. If they do not do it now, they will never get elected again ". I do not like the analogy and the Conservatives have never had the intention of putting the boot into the unions. This Bill certainly does not attempt to do so. But the average genuine worker— the vast majority who want to get on with their jobs— is fed up with those who control his union, and he showed it quite clearly on 14th May.

This Bill is not strong enough, and it will be extremely difficult and time-consuming to bring in a stronger Bill in a year's time if it becomes necessary. Therefore, if it is felt necessary to tread softly and to pass what one Labour Member in another place called "this puny Bill", I believe it must be amended with enabling clauses so that the Minister may tighten the Bill in a number of respects, and in particular in respect of union responsibility for the actions of their members, by order and without the necessity of further legislation. The further tightening amendments can be drafted and argued in Committee, and written now at this stage into the Bill. They would not come into effect but rather be held in reserve. Meanwhile, the provisions would become acceptable by familiarity, if not by use. The presence of easily available new measures would probably mean that they would never be needed. I hope it will be possible to consider this option at Committee stage.

9.3 p.m.

Lord HATCH of LUSBY

My Lords, my first objection to this Bill is its title. One can understand why the Government, after their previous experience, have decided not to call this an Industrial Relations Act, but to call it an Employment Act is surely a misuse of the English language. What has this got to do with employment? At a time of rapidly rising unemployment, as we have seen from the figures today, what have the Government done about employment? As far as I can see, they have done two main things, reduced the budget of the job creation scheme which the Labour Government set up, and undermined the Manpower Services Commission.

The Earl of GOWRIE

My Lords, would the noble Lord be kind enough to give way? What shred of evidence has he for either of those statements? The overall provision in real terms, adjusted for inflation, for the Manpower Services Commission is increased this year over the previous year.

Lord HATCH of LUSBY

My Lords, I am now speaking about the measures that were taken in July of last year. The budget of the job creation scheme was reduced, I think I am right in saying, by £ 170 million, and the powers of the Manpower Services Commission were similarly reduced at the same time.

Let us look at the context in which this Bill is being discussed, a context in which unemployment is rapidly increasing; in which the inflation rate has been doubled over the past year; in which rents, rates, mortgage payments, gas and electricity bills have all been substantially increased; in which the Welfare State has been seriously eroded; in which protection for workers redundancy has been cut and safeguards for the unfair dismissal of workers have been reduced.

The Government say that this policy is designed to squeeze inflation out of the economy. I think that is a fair summary of the excuses that have been given by the Government for the list of facts about the nation's economy that I have just recited. So far the Government can hardly claim great success in squeezing inflation out of the economy. But there is a much deeper danger that arises out of this Bill so far as the Government's objectives are concerned. I would refer to the speech made by my noble friend Lord Kaldor in a previous debate on the economy and industry, when he spoke of the factor of workers' resistance; I believe his actual phrase was "wages resistance". This is where this Bill comes into context, because it is clearly designed and openly designed to undermine, to attack the strength of the trade union movement. The noble Earl who opened the debate with an extremely lucid explanation of the Bill, his noble friends behind him and Members from the Cross-Benches, have made no bones about this. The object of the Bill is to, as they say, redress the balance between employers and employees, and in doing so they are expressly attempting to reduce the power at present exerted by the trade union movement.

But if they do that, then surely the result must be increased militancy among the trade union movement, increased resistance to the cuts in the social services, to the cuts in redundancy payments, to the cuts that are being made in employment itself, and to the attempts to restrict wage increases. If in our country you get a confrontation between the Government and those who are attempting to defend their standard of living, surely you are justifying the whole thesis of Marxist philosophy.

Here you are creating the class struggle which you accuse certain sections of the trade union movement of bringing into this equation. If you are following a policy which is designed to reduce the standard of living of a large number of the working class of this country, and at the same time reduce their power of resistance, then there is a class struggle, whether you want it or not. It is not an artificial one: it is a class stuggle which is created by the resistance to Government policy. To follow my noble friend a stage further, let me say that the probable effect of that kind of class struggle, of that kind of resistance by the organised workers to Government policy, is likely to be increased rather than decreased inflation. The trade unions are bound to ask for more than they would ask for if there were not the attack being made upon their rights. So, from the Government's own standpoint, from their standards, their policy is leading to the exact opposite of what they are attempting to achieve.

The noble Earl who opened the debate referred to the hope that it would be possible to take industrial relations out of party politics. He also referred to the role of the law in industrial relations. Surely the noble Earl knows something of the social history of this country? The trade union movement in this country supports, has supported, and indeed created the Labour Party precisely because the working class of this country needed to change the law which at that time was grossly discriminating against it.

The rights which the trade union movement has today are rights which have been fought for and which have eventually been won through a whole gamut of struggles going back over the past 150 years. I would point out to the noble Lord, Lord Harris of High Cross, that, if the Labour Party in this country had anything like the contributions from the trade union movement that the SDP has in Germany, the Labour Party would not be in its present financial difficulties. I would say further to him that there are countries in Europe— and I hope that the noble Earl when he winds up will deal with this issue which has been raised previously in the debate— where the trade union movement has greater rights than it has in this country, and which are showing the possibility of considerable growth far beyond that of this country. I would refer him to Sweden, to France and to Norway.

Lord HANKEY

My Lords, will the noble Lord give way for a moment? The noble Lord is aware, I presume, that works agreements are executable at law in Sweden and that the recent strikes only took place when those agreements had come to an end?

Lord HATCH of LUSBY

Yes, my Lords, but that does not in any way detract from the point that I am making.

I am simply saying that it is not correct— as the noble Lord, Lord Harris of High Cross, was suggesting— that, because the trade union movement in this country has, as he appears to think, too strong a power, that is preventing the economy of this country from growing. In other countries, trade unions have greater rights than they have in this country and the economies of those countries are growing. That is the point that I was making.

I come briefly to the Bill. Clauses 5, 7 and 8 attack the whole issue of unfair dismissal. Clauses 10 and 11 are, in my view, the meanest in the Bill, because they are the clauses which deal with maternity rights. Is it not ironical that, for the first time in the history of this country when we have a woman Prime Minister, this is the second time that we have had to point out that sexism is being introduced into our laws and regulations?— the last time being as regards immigration. Please do not think that this is just a personal assertion; it was the Under-Secretary of State himself who admitted in another place in the Second Reading debate on this Bill that these clauses left women as second class citizens. It is a mean and indefensible attack upon women workers; in Kiplings words: Mean as a collier's whelp, nosing for scraps in the galley ". Clause 13 deals with the limit on guaranteed payments and Clause 18 is an attack on the Employment Protection Act and on the powers of ACAS to carry out their rightful duties and their rightful responsibilities, and it attacks, totally unfairly in my view, their independence. But let us suppose that all these clauses of the Bill had been put together and that the Bill had become an Act, would the Bill have prevented or have solved The Times strike, the engineering strike or the steel strike? Not one of them. Would it have prevented the scenes outside Grunwick, or the scenes which we all so deeply deplored outside Charing Cross Hospital? Not at all.

Therefore, I come to the issue which was mentioned by the noble Lord who preceded me— Clauses 15 and 16. I would call these clauses, which slightly change the right of secondary picketing, the "martyrs charter" for the reason that they do not, as has been made clear, extend the criminal law in any way at all; they extend the civil law. If an employer is going down to where secondary picketing is taking place, intends to take out an injunction against an individual— and it must be an individual— and take him to court, surely that is an invitation, to those who want to be martyrs and who want publicity, to martyrdom, to go to prison and to repeat some of the tragedies that we have seen in industrial relations over the past 10 years or so.

On the matter of the closed shop, of which the noble Lord, Lord Gisborough, also spoke, I should like those who are to follow me— and I believe that they will be speaking closely in conjunction with the noble Lord who preceded me and the noble Lord, Lord Spens, on the necessity of extending, as they see it, the provisions of the Bill— to address themselves to the following issue on the closed shop. If we undermine and attack the principle of the closed shop— and those of us on this side have always agreed that individual con- science must be preserved, so that is not the issue— are we not thereby encouraging and stimulating multi-unionism?— which not only weakens the trade union movement, but which at the same time is dangerous and distasteful to most employers. Most employers would far prefer to be able to deal with a well-organised body of workers in a single trade union than to have the fragmentation of trade unionism, which can come from the under- mining of the closed shop.

Therefore, I say that this Bill provokes the trade union movement unnecessarily, irritating a body and an organisation with which the Government need to co-operate, because co-operation between the Government, the trade union movement and employers is the only alternative to the class struggle, of which I spoke earlier in my speech. At the same time, as we have heard tonight and as we have heard in another place, the Bill will not satisfy those who are commonly called the trade union "bashers". But, as has already been pointed out, there is a danger that this Bill is simply the "sighter"; this is, just the kite that is being flown, to be followed by further more stringent legislation by the process of gradualism, eroding workers' resistance to the policies of the Government, with which I opened my speech. It may be that this Bill is simply an infant, Mewling and puking in the nurses arms ". When it is followed, it will become a soldier: Full of strange oaths … seeking the bubble reputation Even in the cannon's mouth ". But eventually this approach to industrial relations— so vital to the future of our nation— of undermining the mass of the people of this country in their organised industrial organisation will become a second childishness and mere oblivion; sans teeth, sans eyes, sans taste, and sans everything.

9.20 p.m.

Lord MOTTISTONE

My Lords, it is a great pleasure to follow the noble Lord, Lord Hatch of Lusby, because it is so interesting to me that here we have what the Secretary of State during this last weekend described as a human relations Bill, and one of the problems about human relations is that we all see each other differently. We find that we know lots of trade union officials, both junior and senior; we know noble Lords opposite; we know tough and easy-going managers and employers. We know the lot. You know them, and I know them. On the whole they are pleasant, earnest, and full of good will; but they are practically always misguided, and a classical example is noble Lords opposite.

The fact of the matter is that I think the noble Lord, Lord Hatch, is misguided. He frightens us with talk of the class war, of mass revolution, of practically the barricades, and he ends his speech by frightening himself with continuing and never stopping legislation gradually eroding all the powers that have ever been fought for back to the beginning of the 19th century. That is the picture he was creating for himself. But it is a myth; practically all of it is a myth.

This Bill— and on the whole I think it is a good one, but I shall enlarge on that although I do not want to take too much of your Lordships' time— is more concerned with the individual them with the mass. The noble Lords opposite— and I give credit where credit is due; not all noble Lords opposite— Lord McCarthy, Lord Allen of Fallowfield, Lord Plant, and Lord Hatch of Lusby, all gave the impression of thinking in the mass; of lots of people responding; lots of people doing this, and lots of people doing that. This Bill is about trying in a delicate way— and it is delicate— to restore to the individual a certain amount of protection from the bodies which threaten him.

The bodies which threaten him include of course his company. They also on occasion include his trade union. We all know, if we are honest with ourselves, that there are occasions— and I have come across it repeatedly in life, but particularly in the last 10 years— where you meet somebody who is terrified, and who is bullied into following a particular line that his union wants him to, whether it be a strike or withdrawing his labour; his wife is sick and he has not got very much money, and he cannot stand being on low pay, but he has still got to do it. He is bullied.

At the time of the transport strikes of last winter there were kangaroo type courts set up by unions in the dock areas, to which the managers of companies not affected in the strike, but affected by the sort of thing this Bill is trying to deal with had to go almost literally on their knees, to plead to be allowed to have their goods, because otherwise their industry would go bust and their workers have to be laid off. There is bullying around, and bullying comes from giving people power.

Some people are greedier for power than others. If by chance you give people more power than they need, then you find that the bullies will use it. The bullies may well be— and I am certain they were in the last century and indeed up to, shall we say, 1950— in companies, and could come again in companies, if the various protections that were allowed under legislation were relaxed too much. It is a very neat balance and what this Bill, as I see it, is trying to do is to make sure that it is harder to bully the individual than is the case under the present legislation.

Let us not get it wrong, and here I particularly address the noble Lord, Lord McCarthy, who said in effect— I may be misquoting him and he will tell me if I am— that this Bill is as bad as the 1971 Act in its general effects. He gave me the impression that he had forgotten that since the 1971 Act there were the Trade Union and Labour Relations Act 1974 and the Employment Protection Act 1975. Those Acts changed the picture completely and, because of that, this legislation is not— and I am very much generalising— taking us back to the sort of situation that would have arisen if the 1971 Act had bitten; it is taking us back to the sort of situation we would have had in 1969 if In Place of Strife had been enacted.

Lord McCARTHY

I do not think I made that point, my Lords. The point I was making about strikes and what the Bill is doing about strikes will, I think, be developed by my noble friend Lord Wedderburn of Charlton. I was saying that this Bill is worse than the 1971 Act because that Act gave individual rights, whereas this measure takes individual rights away. In particular, it takes individual rights concerning unfair dismissal away from people who work in small firms.

Lord MOTTISTONE

Maybe, my Lords.

Lord McCARTHY

It does.

Lord MOTTISTONE

Perhaps, my Lords, but, on the other hand, it also takes away rights from superior bodies which are in a position to oppress individuals. It is, therefore, a matter of balance, and that goes all the way through. I said this was a human relations Bill. Human relations involve many facets. They involve guarding freedom for individuals. Directly one uses the word "freedom" one is asked: freedom for whom? Is it freedom for the trade union member, for the company employer, for the trade union official, for the company manager, or is it freedom for people who are not involved at all, people outside the company, in the street, the ordinary person? The answer is that it is freedom for all, and we have to get the balance right.

Take another theme, that of loyalty, which was mentioned earlier. Is it loyalty to the company? Goodness knows! that is necessary. How is the company to be solvent and how is the productivity that we all know is needed to be achieved unless loyalty lies with the company? Or is it loyalty to the trade unions? Or should these not be in conflict? But they are, and let us be practical about it. We know what happens. I do not say they always are in conflict, but they sometimes are; and that is where things go wrong.

We must try to ensure that the loyalty is right. Loyalty is not a direct something that one can legislate for. However, what the Bill tries to legislate for is power, and I talked about power earlier. It attempts to adjust power because, when one comes down to it, the loyalty lies where the power lies. If, as has happened in many countries in the past five to 10 years, in effect middle management has been deprived of its power, although it still has the responsibilities, and effectively the trade union officials— whether they be shop stewards or full-time officials does not matter— talk direct to the chairman (go to see him and drink wine with him) then everybody on the shop floor knows very well where the power lies; it lies with the trade union official. He is not interested, and I am not blaming him for that. It is not his business to be interested in whether a particular company is successful. He should like that in a general sense, particularly if he is a mass thinker, like certain noble Lords whom I mentioned earlier. In a general sense he would like all companies to be successful. But he does not care about a particular company. It is only when one cares about a company that that company is on the way to success.

So what happens is that the loyalty lies where the power is, and, from the point of view of the employer— the single man or woman, the person whose livelihood depends on the success of his company— it is very important that the power should not be in the wrong place. The more successful his company, the more secure is his job. The fact of the matter today is that there are many companies not so secure as they should be, and therefore their employees are not so secure as they should be; and that goes a long way towards causing the trouble. As I see it the Bill is designed to modify the power in an acceptable way.

I must not detain your Lordships any longer. I shall take the matter only one step further. Some of my noble friends, as well as some of my honourable friends from another place, feel that there are areas in which this Bill could be strengthened. As I see it at the moment, I personally do not agree with them. I think that the Bill is just about as far as one can go, because these steps must be taken at the kind of rate at which people can accept them, at a rate acceptable to their attitudes. To go any farther at this time would be a mistake.

I hope that the Bill goes through this House, perhaps with a few tidyings up here and there. We in this House are experts at tidying up Bills here and there, and usually for the better. The important point is that if the Bill is a success— and here I come back to the noble Lord, Lord Hatch of Lusby— there will not be a need for further legislation. I personally and genuinely believe, and I know that my right honourable friend the Secretary of State believes, that there is a very good chance that with the present attitude of mind of the people in the country as a whole, seen as individuals, the Bill will do all that is necessary to redress balances and to give greater freedom from threat to individuals, and will achieve all the good things that it is designed to do.

9.32 p.m.

Lord ORR-EWING

My Lords, first and foremost I wish to congratulate the noble Lord, Lord Keith of Castleacre, on his maiden speech. How appropriate of him to choose this occasion, bearing in mind his knowledge of high class, meticulously careful engineering which he gained from his Rolls-Royce experience. He has much to contribute, and I hope that he will make many contributions to our debates. I know that we shall find them worthwhile, as we found worthwhile what he said today.

I should like to reply to the noble Lord, Lord Hatch of Lusby. He must not believe all the propaganda leaflets that he reads. He seems to believe that the unemployment figure is higher now than it has been in the past. The Statistical Digest simply does not show this to be true. The noble Lord's facts on other issues were also wrong. In 1977 there were 1.62 million unemployed; 6.7 per cent\, of the population. In 1978 the figure was 1.548 million, and the latest figure for May is 1.509 million. So through 1977 and 1978 the figures were much higher, and a much higher percen- tage of the population was unemployed. One ought to be accurate when quoting—

Lord HATCH of LUSBY

My Lords, I am very grateful to the noble Lord for giving way. According to the tapes tonight the figure given today for unemployment in this country— over 1½ million— is the highest figure for May since the war.

Lord ORR-EWING

That reminds me, my Lords, that There once was a fellow named Gover, Who bowled 32 wides in one over. It had never been done By a clergyman's son, On a Sunday in August in Dover ". If one finds statistics, one will always find that the figures are the greatest in May— or something like that. I am quoting the figures, and the percentage was materially higher: 6.7 per cent., as against 6.2 per cent. on 8th May. It was very materially higher then than it was in May of this year.

The second point I wish to raise is that the noble Lord, Lord McCarthy, in opening the debate for his side of the House— and I noted his words; I hope I have them down correctly— said of this Bill that it is "an unfair attack on the rights of trade unionists". Am I right?

Lord MCCARTHY

Something like that.

Lord ORR-EWING

My Lords, it is very difficult to think that he really believes this. The right to combine remains intact; the right to organise to bargain remains intact; the right to strike remains intact; the right to picket peacefully remains intact; the right to assemble remains intact; the right to free speech, to petition, to persuade Governments of the day— all these remain intact. The right to a political fund— money going to the Labour party— also remains intact. The great rights of trade unions which have been built up over the years are not undermined by this Bill, and it would be stupid to try to deceive the country into believing that they are. So I am sure he will correct himself and not make those kinds of claim in the future.

My Lords, I believe, as a member of a small all-party group in this House, that this Bill ought, in its first phase, to go rather further than it does. I recognise that my right honourable friend who has been standing behind the Bar for much of the time or sitting on the steps of the Throne, Mr. James Prior, reckons that he has got the best compromise, but for reasons which I shall explain later I think it should go rather further at this stage. I am mindful of what we promised in our election manifesto, and what we were elected on. Let us be fair: it was the horrible scenes in the winter of discontent of 1978–79 which defeated the Labour Party and which brought us to power. I would remind noble Lords that we said in our manifesto, on page 9: As a result of trades union legislation in 1974 and 1976 it tilted the balance of power in bargaining throughout industry away from responsible management and towards unions, and sometimes towards unofficial groups of workers acting in defiance of their official union leadership ". It went on: We propose three changes which must be made at once "— not next year, but at once; and we were fighting this election in May 1979— and then it went on about picketing, about the closed shop and about secret ballots. It is on that manifesto that we were elected, and I feel that we are expected by the nation at large (and particularly by the trade unionists, because all the analyses show that between four and five million trade unionists supported us at the last election; and I would hazard the guess that a good many more of their wives voted Tory) to move rather further than this Bill currently takes us.

My Lords, I and a number of Members in all parts of both Houses take the view that the Bill needs some strengthening. Mr. Prior takes the view that the Bill is a contribution to restoring the balance, and that he will be perfectly able to proceed with another Bill, in the light of experience, next year. There were some hundred different Tory MPs who decided to vote on the amendments at Report stage. I think that in total on any one occasion they did not exceed 48; but I have to remind the House that they were tremendously supported by the leader of the Liberal Party, by Mr. Cyril Smith and by Mr. Jo Grimmond. There were five liberals in all who supported them on a number of occasions; and I have to be hopeful that that message will be pur- veyed up to the Liberal Benches here and that we may get some support from them in the latter stages of the Bill, particularly as it concerns the freedom of the individual and the closed shop, which must be anathema to any person who has been brought up in the Liberal tradition.

My Lords, I wonder whether events in the next twelve months are going to make it easier for Mr. Prior to bring in the next Bill, or the next half of this Bill, next year. If there is to be a world industrial recession (and there is every indication that there may be); if we are to have political demonstrations and massive strikes, more effective and better organised than on 14th May; if we are to have reduced industrial production; if we are to have increased closures (all of which have been forecast); if we are to have unemployment which is even higher than it was under Labour— and we should not be unique in having high unemployment, because Western Europe and other advanced countries are also forecasting it— then will this be the right climate in which to introduce another phase of this Bill and provide for more reforms of trade union legislation? I would hazard from all my experience that it is very much easier to bring in legislation in the first and second year than in the third year of a Government.

I feel that the picketing legislation (which I know is going to be in a code of conduct) as far as it goes in the Bill at the moment is pretty weak and flabby. All Governments have been worried about picketing, the Labour Party more than any; and I recall from the front page of The Times that flamboyant headline: Police arrest 70 as Grunwick battle leaves 30 hurt ". Eighteen policemen had been injured. Mr. Scargill had brought down 18, 000 in buses from the Yorkshire mines to join the demonstration in support of the strikers— and they were striking against 350 mainly Asian and mainly women in a very small works on the edge of my old constituency. At that time the Government were clearly worried— as they should have been, and as the nation was. Here from The Times is an obviously inspired leak: The Government is considering changes in the law on picketing in the light of the Grunwick dispute, to relieve the police of what ministers now regard as an impossible burden ". Understandably so— 5, 000 policemen, one quarter of the police population of Metropolitan London, were deployed to try to keep the peace. Since then, we have had ugly scenes in other places. The Times goes on: They would include restrictions on the number who would have the right to assemble outside factories, and perhaps confining the legal right to picket to those with a legitimate trade union interest in the dispute so as to eliminate the gathering of politically motivated militants: the so-called 'rentamob' ". This is exactly what this Bill seeks to do. I am surprised that this has not been picked up. That is probably why it went through the House of Commons with little "aggro"— fr that reason and a host of others. The Labour Opposition (as my noble friend said in his very able opening speech) went through the formula, the minuet, of objection; but there was no "aggro" behind it. When one went down there, one could see that, by and large, they were pleased that some other Government were picking up the responsibility that they failed to bring into law.

Then we have the transport strike of 1979. As a result of that, the TUC brought out some guidelines, as did the Transport and General Workers' Union. I have studied both of these. I have the admirable TUC booklet here. It was not obtainable in the Library but I obtained a special copy. The booklet sets out perfectly good, standard guidelines as to what ought to be the behaviour of mass pickets. They would be admirable if they were obeyed. But, as we saw at the private sector steel industry plants at Hadfields' and Sheerness, there was no intention of obeying them. I had expected the noble Lord, Lord McCarthy, with his lucid attack, to make one constructive suggestion. After all, for 11 of the last 15 years, the Labour Party have been in power. They are tied to the trade unions and they, above all others, would wish to see respectable behaviour and not mass picketing of the type which appalled not only our own population but, when shown on television round the world, amazed many of my foreign friends at what we have allowed to happen in Britain. It undermines also the confidence in British goods and in British deliveries.

So, my Lords, I support the idea of a code of conduct on picketing. I think that these sort of guidelines are unexcep- tionable; but I cannot help feeling that somehow we have to separate the official pickets, which will be allowed in limited numbers to do their proper task of peaceful persuasion, from the mass marches and demonstrations which Mr. Scargill, or anyone else, can lay on (as my noble friend Lord Gisborough said) at two hours' notice so as to put thousands of miners in buses and drive them anywhere in the country to cause a furore. We must try to separate the two. I would suggest that we ought to have a cordon sanitaire around works where there are major industrial disputes and where official pickets are mounted— just as, as so many noble Lords know, the rules apply to elections in the constituencies, where you are not allowed to "loud-speaker", to persuade, people too close to the polling station, for it is thought to be unfair to do so or to demonstrate near a polling station when people are making up their minds how they are going to vote. So there is a cordon sanitaire round the polling station. Could we not have a cordon sanitaire round a major industrial dispute? It does not need legislation, it just needs guidance. When the police are asked for permission to demonstrate or for permission to have a meeting or permission to march they will suggest that those marches and demonstrations should be kept away from the industrial dispute. That is the type of measure I would hope for.

On the closed shop, the noble Lord, Lord Spens, said that I was going to enlarge on this subject. My noble friend Lord De L'Isle made a most important speech when he drew attention to the fact that Parliament might be in contravention to the European Convention on Human Rights. We would want to study that speech and think about how we could make the closed shop more liberal in its approach and more respectful of individual human rights, as my noble friend, Lord Mottistone, said. This is of primary importance.

Now I come to the secondary action. This is contained, as the noble Lord, Lord Hatch of Lusby, said, in Clause 16. It deals with secondary picketing and blacking. I find Clause 16— I do not know whether other noble Lords do- desperately difficult to understand. One goes round and round about this and that. One really does not get the message very clearly. If we who are somewhat experienced in reading Bills find it difficult— and this is the case in both Houses because it was put in to the Bill so late that many of my friends in the Commons did not understand it very well either— how are both senior and junior management going to understand it? How are trades unionists going to understand it? How are those who organise, rule and pay the "Rentamob" going to understand it?

I cannot help feeling that there must be better ability within the law department of the Parliament of a country of 55 million people. Could we not find some lawyers who could write simpler English which could be more widely understood than the particular clauses that are drafted here?

The Earl of GOWRIE

My Lords, will my noble friend give way? I have no intention of explaining this difficult clause at this juncture. My noble friend is clearly illustrating the central problem behind this and the general debate, which is that law based on immunities is inevitably more complex than law based on rights and responsibilities.

Lord ORR-EWING

My Lords, my noble friend is right but I hope that it will not undermine his desire to make it simpler so that we can understand it. Every firm which has a contract to supply parts to a major firm which is in dispute could find, whether it is providing parts or services, that its own employees were taking industrial action in sympathy or as part of a blacking operation. This is desperately damaging to the whole economy of our country.

Take Fords, for example. I am the chairman of a company making braking mechanisms for the truck divisions of our big manufacturers. We have to deliver components every day. The same applies to Lucas or Smiths or people making axles and wheels and every part of a car. They are assembled. There are thousands of firms contributing to the main manufacturers. Are all these going to be liable to disruption? I have to remind the House that the car industry, which as previous Chancellors have found, is very important to our economy, has now gone over to what is called dual sourcing. If you are making axles, one axle will probably come from this country and another from Europe. Equally the big manufacturers in Europe will buy half from their own country and half from Great Britain, to their own designs. So, if you find this spreading through secondary action and secondary blacking, you will find our exports are also being undermined. You are not just stopping Ford UK or Vauxhall UK, you are going to stop our exports and further undermine confidence in our ability to deliver. So I would ask my noble friend, in the interval between now and the Report stage, when we shall be putting down amendments, to look at this, because at the moment it does not seem to me to make sense.

My Lords, I apologise but may I just summarise? I believe that this Bill still has certain weaknesses. We are a revising House, and to some extent a delaying House. I believe that the legislation about secret ballots should be somewhat strengthened not making secret ballots compulsory, as the noble Lord said when introducing it, but permitting them. When a certain number of people within a firm desire a secret ballot, whether they are 500 or 15 per cent., then there should be liberty to have a secret ballot and for it to be publicly financed.

On mass picketing, I believe we must look at this again, particularly secondary blacking, because that could be desperately damaging and people would be affected who are not really party to the industrial dispute. I think that the country expects your Lordhips' House to stand up on constitutional matters and be counted. I think it also expects us to stand up for individual freedom, and on both those scores I hope that we shall put down amendments and that each person will consider very properly and without prejudice whether we can make improvements to this Bill which will be persuasive and effective, and will be accepted by Parliament as a whole.

9.53 p.m.

Baroness SEEAR

My Lords, I must first apologise to your Lordships' House that I was not here at the beginning of the debate, and I apologise particularly to the Minister as I did not hear his opening speech. Unfortunately, I had a longstanding engagement in Nottingham which it was not possible for me to break. I am particularly sorry that I was not able to hear the maiden speech of the noble Lord, Lord Keith of Castleacre, but I understand from my noble friend Lord Rochester that it was a very considerable contribution to the debate in your Lordships' House this evening.

The best amends that I can make, my Lords, is to be very brief at this hour of the night, and that I intend to be. I have in fact cut out a good deal of what I intended to say. I cannot, however, quite resist responding to one comment made by the noble Lord, Lord Hatch, who claimed that it was only the development of the Labour movement which gave trade unions the position that they have in the country today. I would remind him that it was in fact the Liberal Government of 1906 that, rightly or wrongly, conferred on trade unions the immunities which we are discussing in your Lordships' House today. Be that as it may, wrongly you may say, rightly I would say, but that is a matter for another debate.

My Lords, there are matters in this Bill with which I am far from happy. I am not happy about the withdrawal of rights for people in small firms. I believe that that matter could be dealt with in another way. I believe that a great deal of the position in relation to small firms arises from misunderstanding. One is constantly being told, up and down the country by people who should know a great deal better, that it is impossible to get rid of anyone. Endlessly does one point out that the number of employees taking cases to industrial tribunals and winning them is smaller than the number who lose them. People do not believe it, and small employers have been almost brainwashed into believing that if they take people on, however incompetent, they are not able to get rid of them.

This is a very great mistake on their part. I do not believe the way to deal with it is to get rid of the rights which have been conferred on employees just because they happen to be employed in small firms. Nor, will your Lordships be surprised to hear, am I happy about the maternity provisions, but we shall return to this on another occasion.

I believe, too, that in removing Schedule 11— and I agree with removing it— we need to ask ourselves what we propose to put in its place in order to safeguard the position of the least well-paid of all who are often not defended by trade unions. We must not forget that to a very large extent the trade unions defend the position of those who are in pretty good employment, and there is a section of the community— the poorer section— which no longer believes that it is adequately protected by trade unions. I believe that the success at Edge Hill by a Member of my party in another place was due to the fact that there is a section of the employed population who no longer believe that the trade unions are going to give them the protection they require. When you remove Section 11, I believe it probably is necessary to find some other protection for that section of the working force. But these are matters which are probably more appropriately dealt with at Committee stage, and at this time in the evening I do not propose to enlarge on them any further.

Having had unexpected support from the Labour Front Bench, I am now going to forfeit all that support because, by and large, I support this Bill. I believe that good industrial relations have to be a blend of law and of good industrial relations practice up and down the country. It has to be both, and those who deny that law has a place in industrial relations really must explain why, of all relationships in society, only the relationship between employer and employed should not be subject to law. Of course that is nonsense. The relationship between employer and employed is in many respects subject to law, and members of the Labour Front Bench would be the very last people who would wish not to have law in industrial relations. It is absolutely essential that there should be law. The argument is not about whether there should be law in industrial relations: it is about what sort of law there should be. So let us forget all about this nonsense that you cannot legislate for industrial relations. You must legislate for industrial relations. Let us get that one out of the way.

Then we have the ridiculous argument— I was unable to hear the speech of the noble Lord, Lord McCarthy, which was most unfortunate from my point of view— that because the 1971 Act did not work therefore no Act will work. That is really like saying that if you have a sick patient and you give him the wrong medicine the first time, you let him die rather than try another lot. How the noble Lord, Lord McCarthy, can say that this is the same medicine as 1971, I simply do not understand. I know that the noble Lord, Lord Wedderburn, who can explain anything in this matter, will explain to us that it is exactly the same. I shall remain totally unconvinced. Anyway, there is no reason whatsoever why, because one piece of legislation was unsuccessful, we should not try again. There is in my view every reason why we should; so let us have some law.

What is the case for having this law? The case that has been put forward is that we need it because the balance of power has shifted from employer to trade union. I think that is far too sweeping a statement. The position of the balance of power is extremely complex. There are some parts of industry where the balance of power has indeed shifted, largely for technical reasons, and where it is impossible for the most powerful employer to continue in operation because some part or service which is under the control of a trade union and is so vital is denied to him. In those circumstances, the balance of power has indeed shifted abruptly and very severely against him.

There are still many other sections of employment in which the balance of power remains on the side of the employer; so do not let us have too sweeping statements about what has happened to the balance of power. Nor do I believe that this legislation or, in my view, any legislation would totally alter the situation in that first instance, where the reason for the shift in the balance of power is very largely technical. This Bill does not do it and, in my view, no Bill can do it. This Bill can modify it. It can modify the impact, but it cannot entirely redress the balance, because that has changed for reasons which have nothing to do with the law, and have very little to do with the nature of trade unionism itself.

Then we are told that we need it in order to protect the rights of individuals. Of course, anyone speaking from these Benches— and I believe anyone speaking from any of the Benches in your Lordships' House— cares about the rights of individuals, and I am glad that there are modifications to the previous position in relation to the closed shop, and that in future it will not be so easy to establish a closed shop. There are two arguments used against this, and against which I wish to protest. One is that, after all, only a very small number of people have been affected by the closed shop regulations. It cannot be said too often that an injustice done to one person is serious and an offence, just as much as an injustice done to 1, 000 people. To say that there are not many people who suffer is to show a total misunderstanding of the nature of justice and injustice. So that we certainly need to have some modification of the power of the closed shop.

I would also point out to those who think that this is going too far that, after all, all that is done in this legislation with the extension of the arguments that can be used, the extension from religion to other reasons for objecting to joining a union, is to give the people who so protest the right to compensation. It does not give them their job. So it is very difficult to see that this is an excessive extension of control over trade union power in relation to their members.

The other matter upon which I wish to take issue is when people say— and it has been said in your Lordships' House today— that a great many employers like the closed shop. So they do. But when I am told that both the trade unions and the employers approve of a certain practice, then I know that it is time that the rest of us started to protest.

That brings me to what I see as the major reason for legislation in this field. We need it not so much because of the balance of power, not even so much because of the need to protect individual rights, but because the community as a whole— and consumers in general— have suffered grievous harm because of the poor industrial relations in this country. I am not referring to the spectaculars on television last winter, deplorable though they were. Much more damage has been done, insidiously over the years, not so much by strikes but by working to rule, by resistance to technical change and by refusal to have innovation which would greatly have increased the wealth of this country. It is against that kind of abuse of power, and collusion in it from employers as well as trade unions, that the public as a whole need to be protected. That is why I believe that improvement in industrial relations, of which this Bill is a part, but, in my view, the less important part, is vital at the present time.

As I listened to the debate this evening, and I expect that it will be the same to the very end, I had a sense of fiddling while Rome burns. The position in this country is far too dangerous for arguments of this kind about what are relative details in a minor Bill. Unemployment figures are rising. Inflation is over 20 per cent. Industry in the North is frightened for its life. There are bankruptcies and there will be more as the year goes on. The unemployment among school-leavers is horrifying. The unemployment among black school-leavers is a horror and a disgrace. How can we be having this shadow boxing— and a lot of it is shadow boxing on both sides— while things are as serious as they are?

We have this Bill. It is true that we need some reform. We have been told that later there may be more law. I implore the Government, with the cooperation of the Opposition, to get this Bill through and to modify it here and there, if they must and if they will. But when it is through, let us have no more law. Let us work on the other side of industrial relations. Let there be cooperation at all levels. Let the Government start talking again— really talking, not lecturing, not hectoring us. Let there be three-party talks again within the framework of Neddy at national level. Let there be talk even about pay, because pay is a part of industrial relations. Unless we get this right we cannot get the rest of it right.

All right— do not have a formal policy if you will not, but talk about pay and about the real reason why we need progress on this front. It is not just the working classes, whoever, in God's name, they are today, but the whole country which will be gravely impoverished. And we may not recover from it this time— not in a decade, not in two decades. Then let us proceed from there: the Government to give the lead from the centre, with real collaboration at industry level and at factory level. We know that there is a great deal of good sense, a great deal of desire for recovery and a great deal of will to work.

I do not condemn so much the Government's policies. I believe that the Government are sincere, but they have not been able to get that over. If the Government want an improvement in industrial relations— yes, indeed, let them begin with this legislation; but having got it through, let them then not be afraid of what may appear to be a change in policy. Let them take the initiative to get co-operation going at all levels.

10.7 p.m.

Lord WEDDERBURN of CHARLTON

My Lords, it falls to me first to congratulate the noble Lord, Lord Keith of Castleacre, and particularly to do so because I share with him the experience of making my first intervention in your Lordships' House on a controversial issue, though attempting to be uncontroversial. I feel that we have succeeded in equal measure in that respect. I have the difficult job from this Bench of replying to the debate. As did the noble Baroness, Lady Seear, I will attempt to be brief, but I cannot promise to be so brief as she. One reason for that— I say this particularly to noble Lords like the noble Lord, Lord Orr-Ewing— is that sometimes I felt, as when the noble Lord, Lord Orr-Ewing, attacked my noble friend Lord McCarthy for misinterpreting and misrepresenting the Bill, that I had been reading a different Bill from that read by some noble Lords who have addressed your Lordships' House tonight.

I agree with the noble Lord, Lord Robbins, that the Bill raises issues of great principle— the principle of the relationship between the law and industrial relations. I agree with my noble friend Lord Kaldor in his penetrating analysis of the Government's economic and social policies in the debate on 16th April, when he said that it was an essential part of the Government's strategy to break wage resistance.

This Bill is the legal arm of the strategy of breaking wage resistance. It is not a modest Bill; it is not a moderate Bill; and, with great respect to the noble Baroness on the Liberal Benches, it is not a mild Bill. And we are not shadow boxing about it. This Bill was elaborately wrapped by the noble Earl. He always does that with his parcels. He had five this evening and the tinsel was glittering; there was the allusion to "My Fair Lady". But when one begins to look inside the parcel, one finds, as my noble friend Lord Hatch of Lusby said, that in it there is nothing to deal with any of the appalling economic problems which the Government have been exacerbating by their policies. One finds that there is nothing to stop the policy of smashing the national consensus which has existed since the war and which this Government have been the first Government to smash in this appalling manner. Indeed one finds a Bill which will make the smashing of the consensus quicker and more profound.

I was surprised to hear from the noble Lord, Lord Rochester, on the Liberal Benches, the complaint that the trade unions should now say what they are for. I commend to him the regular publications by the Trades Union Congress and its affiliated unions in which an alternative strategy is quite clearly set out. He may not agree with it, but he really cannot complain that the trade unions have not given a clear account of their alternative strategy; and my noble friend Lord Allen of Fallowfield spoke of the long tradition and the great contribution which he personally has made— and I am sure the noble Lord would recognise it— towards positive policies with Government.

Lord ORR-EWING

My Lords, before the noble Lord leaves that point— he said that it was the national consensus— may I ask: has he looked at the Gallup polls, which show that about 80 per cent. of the people of this country believe that there should be some trade union legislation and that 66 per cent. of trade unionists questioned also thought that? Where is national consensus if it is not behind this measure?

Lord WEDDERBURN of CHARLTON

My Lords, national consensus includes the element of treating the trade union movement as though it is a body to be consulted in a proper manner; not to be told that it can go away and play with wages after the Government have determined the entire range of social policies, given cash limits of an absurd kind for an industry which means a 2 per cent. offer. It means consultation in a real sense, and it is that kind of consensus which all Governments have followed. Looking back, we realise now what a change, what a watershed this is in national affairs; what a different style and what a different philosophy.

The Government have two great advantages in promoting this Bill. First— and I was grateful to the noble Earl for being one of the few speakers (if I may put it this way) who did not misrepresent this point this evening— the Government have the advantage of a quirk of history which has given us immunities in trade union law. The noble Earl was quite right when he said that the curious way in which our industrial revolution developed left us not with positive rights— the right to strike and the right to associate— which all other Western societies have, but with a set of immunities. The reason is almost certainly clear, that our Labour movement developed before any working class party developed in this country and before universal franchise.

That is the basic difference between our first industrial revolution and the rest. Instead of having positive rights we have a set of immunities. It is a very strange system; it is neither virtuous nor vicious in itself. It is strange, but of course it allows people to stand up and make the most extraordinary statements, such as that all the immunities are privileges. Without the immunities in our present structure of law trade unionism would be unlawful, trade union action would be unlawful.

To say that something is an immunity does not take the argument further one way or the other, despite the Aunt Sallys which were raised by the noble Lord, Lord Harris of High Cross, and, I am afraid, by the noble Lord, Lord Robbins, who said that law has no place in industrial relations; and the noble Baroness, Lady Seear, also spoke of that. I do not know where they have been reading these curious Aunt Sally propositions. Of course law has a place in industrial relations, but if one is scholarly about it one has to distinguish between individual protective law and the law relating to collective labour relations. Whereas the fashion of those who set up Aunt Sallys a few years ago was that we should import some law from the United States of America and Sweden, the fashion tonight seems to be that we should import our laws from Germany. The one thing that 20 years of comparative research into the realm of law and labour relations has taught me is that one cannot import law from any other system in this area, because in collective labour law the delicate threads of history weave in each society a most fundamental and intimate relationship— akin to family relations. One can learn by looking at other systems, but one cannot import them.

A number of noble Lords have said that our trade unions have more privileges than any other trade unions in the world. That is absurd. A number of countries have been mentioned. It so happens that Italy has not been mentioned, but Italy has a right to strike which takes precedence over breaches of contract, which prevents any worker from being dismissed by reason of going on strike and which allows for political strikes to be lawful.

Noble Lords may like or dislike that, but just as a matter of fact and comparing British law, they cannot say that our law gives trade unions the greatest rights in the world. Our trade unions labour, as the High Court and Court of Appeal have shown over the last two years, under a very large number of legal restraints which, until the House of Lords resuscitated the law of 1906 last year and this year, was being gradually narrowed by further judicial interpretation. These immunities are not privileges. It is no privilege in a democratic society to have the right to associate and the right to withdraw your labour.

It is also false to say that the immunities were extended in the Trade Unions and Labour Relations Acts. So many Lords have spoken of this point that I feel I must deal with it now, although I would have preferred to deal with it rather later in my speech. I say it is false to proclaim that the 1974 and 1976 Acts, which were what the Labour Government wanted to put on the statute book because in 1976 it was a majority Government, were an extension of the social compact established in 1906. The reason why it is false to say it— and I am surprised that the noble Lord, Lord Renton, as a lawyer does not know this— is that in the intervening years, as a number of Law Lords have commented in recent cases, there have been judicial extensions of liability beyond that envisaged in 1906. If I put it shortly, I put it this way: that in 1906 there were thought to be three main areas of economic pressure by which industrial action could become unlawful. One was conspiracy, the second was interference with trade, and the third was inducing a breach of employment contracts.

If the noble Earl consults the Donovan Report, where some research was done on this matter, he will find, in paragraph 887, the Donovan Report saying it is odd that employment contracts were the only contracts protected against interference, but, they say, the reason for that was that in those days the cases seem all to have been cases of that kind. Later, especially in the 1960s, the courts extended liabilities unknown to the legislature in 1906. The noble Earl does not have to take my word for this. He can look at the supplementary memoranda put in by his own department, the Department of Employment, to the Select Committee in another place, which speaks at page 11 of … the important new tort liabilities facing officials — that is, union officials— because of the wider ambit given by the courts to the modern law of interference with commercial contracts ". I will quote the cases because Lord Renton suggested he did not know them, and therefore I should give them to him by citation in the proper manner.

Lord RENTON

My Lords, would the noble Lord allow me to intervene? In another place when that legislation was discussed the grounds for that legislation were not, so far as I remember, except on two points, put forward as being a method of in effect reversing or correcting— whichever term appeals to the noble Lord— what the courts had decided in several cases. The legislation was put forward as part of this new social contract of the last two Parliaments.

Lord WEDDERBURN of CHARLTON

My Lords, the noble Lord's memory is different from mine. I remember that Hansard printers were on strike at the time, but I still have some of the typescripts. He will consult the debates and so will 1, and we will see how far it was mentioned. My memory is clear that there were three areas— and certainly this was the reason for the legislation— in which the courts had extended liability. The first was direct and indirect inducement of breach of commercial contracts, which was what the Donovan Report realised the courts had done, and which obviously outflanked the 1906 Act.

Secondly, there was the decision in the case of Rookes v. Barnard in 1964 in the House of Lords, where for the first time it was held that a breach of contract was in the same category of unlawful means as violence and that therefore the threat of it was a civil wrong of intimidation. And the third can be no better expressed than in the words of the Master of the Rolls himself in the case of Torquay Hotels Limited v. Cousins in the second volume of the Chancery Reports 1969, where, at page 138, he said: The time has come when the principle "— that is, the principle of interference with contracts— should be further extended to cover deliberate and direct interference with the execution of a contract without that causing any breach ". When it is suggested— and the noble Earl fell into this category, although not as clearly and so strongly as some of his noble friends— by the noble Earl's Government (and it is on record certainly by members of his Government) that the 1974 and 1976 Acts extended the liabilities, I say to him that paragraph by paragraph the 1976 settlement is precisely the same as the 1906 settlement, except for the fact that the words are changed, because if we enacted the words of 1906 in 1976 we would leave three huge areas of liability which would make industrial action unlawful. So, in fact, it is a falsehood to suggest that in 1976 any extension of trade union rights occurred in this country. What was meant to happen in 1906 happened again in 1976.

I see that the noble Baroness, Lady Seear, has left the Chamber for a moment and so I shall keep my next remark until she returns. It is sad to see the Liberal Party not understanding what has happened to its great Act. However, that is the first great advantage that the Government have, especially in the country. It links with my second point, because the second advantage, of course, is the way in which the Bill has been presented to the country. The debate before your Lordships' House, although it has sometimes been quite different from the content of the Bill, has at any rate resembled the Bill on occasions. If we consider the media, what has happened as regards the presentation to the country has simply been a scurrilous campaign against trade unions which my noble friend Lord Howie of Troon suggested consisted of displaying the conduct of a minority of trade unionists as being representative of the movement as a whole.

The Earl of GOWRIE

My Lords, I wonder whether the noble Lord would allow me to make a point as regards the media? Some of us could also say that it has been a scurrilous campaign against my right honourable friend the Secretary of State.

Lord WEDDERBURN of CHARLTON

My Lords, I shall hope to show the noble Earl that nothing is further from the truth, and that what I am trying to do is to analyse his Bill and to show that it takes collective rights of trade unions back to the law of 1905. I say to the noble Earl— and no doubt he will wish to consider this matter on advice— that the Bill is a breach of the United Kingdom Government's obligations under the European Social Charter. I shall come to that point later. I say quite seriously as regards the trade unions— and it is not a question of attack— that action which is not approved by trade union leaders, by a number of trade unionists, has occurred many times in the history of trade unionism. In the works written in 1890 your Lordships will find exactly the same thing being complained of by trade union leaders. Now it is presented night after night and day after day as though it were representative of the trade union movement. The trade union movement in this country last winter— or, indeed, at any other time— mounted the most peaceful picket lines in the world, and the noble Lords who have spoken about picket lines abroad cannot have seen them in Canada, Belgium or in a large number of other countries.

It is totally false to suggest that the trade union movement is characterised by this kind of thing, which in any event existing laws are there to deal with. If noble Lords look at the evidence given to the Select Committee of another place on 27th February this year, they will find that, although in respect of some demonstrations some chief constables suggested that the law could be looked at in detail, generally speaking the existing law on violence and mass obstruction is, of course, [sufficient, if the police constables decide to enforce it.

I should like to quote the Chief Constable of South Wales, Mr. Woodstock, who gave evidence to the Select Committee of another place. It is a quotation which is very relevant to the mood of some noble Lords tonight. He said: Quite frequently there are occasions when pickets are there in large numbers and all is peaceful and no great difficulties are caused. They are sometimes there for comradeship and solidarity ". This is a chief constable of police speaking, not a trade union leader. He goes on: You must not assume that on every occasion there is a mass picket there is going to be trouble. You sometimes get a very jaundiced picture from the mass media who tend to highlight the occasions when things go wrong, but this is by no means the norm, because there are many other incidents which pass off day by day without any difficulty whatsoever. No one likes strikes— as were mentioned this evening— by gravediggers, ambulancemen, hospital cleaners, firemen or, come to that, Kent miners. I had planned to mention the prosecution of the Kent miners in 1941. I thought that we had learnt 40 years ago that issuing writs and injunctions against free men and women did not make them drive ambulances or I dig coal, or clean hospitals or work in a way that no doubt we would all wish in a happy society.

On trade union power, many noble Lords have complained about the im- balance of power. I say that the real problem today is that trade union power is too weak in the sense that, opposed by concentrations of capital, our society allows the power of working people through their organisations to be expressed in only a negative manner. When the trade union movement comes forward with requests for new structures of industrial democracy which would allow a contribution in a full sense for the frustrated talents of a large number of our people, it is treated as demanding some unwarranted infringement of the rights of management and the board of directors. It just will not do for noble Lords to speak in the way they have about the power of the trade union movement. Unhappily, it is a negative power and it should be positive. If this Bill contained anything which was positive and which offered the trade unions a way of contributing, a response would come. But this Government make no such offer.

There is, in fact, a very old Conservative script which is brought out from time to time. For example, you read in The Times leader that: Judged either by Britain's present situation or by international standards, these are fair and moderate proposals. But that comes from The Times of 6th October 1970 and refers to the Industrial Relations Bill. The script is that once workers were oppressed, but now they are not. Now the balance has been restored and has swung too far the other way. One can find quotations in precisely those words in the 19th century, in 1906, in 1970 and again today.

It was, indeed, the great act of 1906 of the great Government of the noble Baroness, Lady Seear, and the noble Lords on the Liberal Benches, with their great Lord Chancellor, Lord Loreburn, which saved the country from industrial strife by making strikes lawful. I say to them that when they do not resist, as they say they will not resist, the cutting back of those rights to the proportions of 1905, "Oh! what a falling off is there". It is hardly worthy of the great party to which the noble Baroness belongs and its history to allow these rights to be cut in a way that her forbears would never have allowed.

There are three main areas of this Bill on which noble Lords have made remarks and on which I must at least comment very briefly. First, there is the area of individual rights. Much has been said about individual rights. The noble Lord, Lord Spens, spoke about the small business and individual rights and, of course, the individual rights of workers in the small business will be savagely cut back in regard to unfair dismissal in firms of 20 employees or less, and in maternity rights in firms of five or less.

In passing, I may say that we shall press the Government very hard in Committee, as we shall on this whole Bill, on this question of 20 employees, because in many areas— as has already been pointed out by some employers— the limit of 20 employees will encourage the worst employment practices, such as lump labour. Employers will take on lump labour; they will not go over 20 employees so they need not worry so much about employment protection. The myth of the small firm is being used to cut the rights of workers about dismissal and maternity rights. It is a myth. I ask the noble Earl, Lord Gowrie, to record for me, at any rate in Committee, if he cannot do it now, any independent survey— not the surveys of the National Federation of Small Businesses which had a 2 per cent. response, or the Small Business Bureau, which asked for ammunition against the Labour Government— of which there are at least three which have shown that these employment protection laws do not cause substantial practical difficulty for businesses, big or small.

It is said by the noble Lord Lord Spens, that the small businessman cannot understand the Employment Protection Act. What the surveys show is that too few small businessmen take the trouble to learn about the employment protection laws, and the small shop steward gets on pretty well when he really makes the effort.

Lord GISBOROUGH

My Lords, will the noble Lord give way?

Lord WEDDERBURN of CHARLTON

My Lords, I have given way already. I must not detain the House too long. This Bill, under the smoke screen of the small business, which is all the public knows about it, then goes on to reduce the unfair dismissal rights of workers as a whole— as my noble friend Lord Allen of Fallowfield, pointed out so well— and also the maternity rights of women workers in general, who are indeed one of the exploited groups of our workforce, and who will be subject to an absurd bureaucratic machinery where their maternity rights and return to work rights will be lost.

The second area of the law where this Bill will impede and weaken support for collective bargaining and trade union structures falls into four categories. First the Bill takes away the ACAS power to recommend recognition with binding effect of a trade union upon an employer. In this I agree with the right honourable gentleman who is now the Chancellor of the Exchequer in what I suppose will have to be called, in view of current terminology, the "demi-sec period "of his political life, when he wrote in the Daily Telegraph of 2nd January 1968: Employers should be obliged to recognise and negotiate with trade unions if this is desired, after a secret ballot if necessary by the employees concerned. I agree with that sentiment, and I agree too that the provisions of the 1975 Act are far from perfect in this respect. But to repeal them and put nothing in their place is simply to ask for more industrial strife about recognition. If that is what the Government are asking for, that is what they will get.

Similarly with Schedule 11. At least at the moment Schedule 11 does something about low pay. It does not do a lot. It has defects. I was glad to hear the reassuring noises from the Liberal Benches tonight which showed that at least the Liberal Party is in favour of salvaging something of Schedule 11 in order to help the low paid. This is an example of the national consensus.

We have had unilateral arbitration for the low paid of the undercutting employer since 1940. This ran from 1940 to 1951, and 1951 to 1958, when the Conservative Government replaced it with an Act of 1959. Only now are the low paid to be left with no statutory structure to assist them except the fair wages resolution which the Government dare not rescind because it would be in breach of yet another of their international obligations. "Wait and see", the noble Earl says. If the fair wages resolution is to be repealed I hope he will tell us now. We do not want to wait and see.

The Earl of GOWRIE

I did not say "wait and see". I said "wages councils".

Lord WEDDERBURN of CHARLTON

Indeed, the noble Earl reminds me; I had forgotten the point. If it is so offensive to the free market economy to have in Schedule 11 statutory machinery to help the low paid, why is it not offensive to have statutory wages councils? Do not they offend the Mancunian leanings of the Government? It is a strange line to draw between Schedule 11 on the one hand and fair wages resolution and wages councils on the other. It makes no sense. I suspect that sensible members at the less than dry end of the Cabinet know perfectly well that a lot of this makes no sense whatever. They know perfectly well that they are pushed into this measure partly because they have to resist the pressures from behind them to go further. The same is true of trade union affairs and the closed shop in general.

Before I make the point which I promised the noble Earl I would make in detail, I will make only three points on this matter as time presses me, because it is a serious charge against the Government in regard to their international obligations. On trade union affairs and the closed shop, I would say first that the Bill gives to industrial tribunals the right to decide whom it is reasonable to accept and admit into a union. Those who have spoken for it say this is only right because of individual protection. There is a case to be made for that. I happen to think it is the wrong way of doing it. It is better done by voluntary machinery. Such legislation gets in the way of the Trades Union Congress disputes procedures, as to which no one in the Government has yet explained the position in regard to this legislation, and which saves a great deal of industrial difficulty every day. It will be made much more difficult to operate by these clauses. I see the case; but I do not hear any voices saying there should be legislation whereby trade unionists who are refused a job can go to an industrial tribunal and say, "It was unreasonable not to employ me, not to engage me and admit me to the job". Where is the logic in that?

Nor do I hear any answer to the clear case made in the Donovan Report at paragraph 376, that you cannot have, and cannot expect, industrial tribunals— they called them labour or industrial courts— to operate on individual employment matters between employer and employee, if you also give them the much more politicised role of determining collective disputes or relations between unions and members. That judgment was right then and it is right now, and by bringing the industrial tribunals into a much more politicised area, the Government are throwing away such confidence as they have built up.

As far as the closed shop itself is concerned, which is the big bogy of British industrial relations, I noted that the noble Baroness, Lady Seear, answered the whole point by saying that if employers and trade unions were in agreement about it, she knew she was going to object. I am not sure of the logic of that. It may be a good or bad thing, but it is a strange position to take up on principle. It seems to me that most noble Lords who have spoken— I refer in particular to the noble Viscount, Lord de L'Isle, the noble Earl, Lord de la Warr, and the noble Lord, Lord Rochester— have overlooked the simple fact that in regard to the development of an industrial relations system which knows of union security arrangements (and that is not just the British system; the American and Swedish systems have union security arrangements which are quite strong in their own way) we have 100 per cent. trade union arrangements. These have grown up, and this gives rise to a clash of principle. On the one hand stands the only principle which the noble Lords opposite seem to know about, namely, the claim, "I want to be here as an employee without joining a union".

I understand that. But the right that they do not seem to understand at all is the right, on the other side, of each and every trade unionist to say, "I want to work here with brothers who make a contribution and do not just take the fruit as free riders from the collective bargaining to which they make no contribution ". Those two rights are in conflict, and what we did in 1974 and 1976 was to draw a compromise line. If you have two rights which are in conflict and which do not have logical priority the one to the other— and I make no claim that they do, although personally I think collective bargaining is sufficiently important to place great emphasis on the second— you draw a line. We drew the line at religious objection.

What the Government pretend to do in this Bill is to draw a different line. But I say— and we shall make this stick in Committee— that the line is a sham, that existing closed shops or 100 per cent. union membership arrangements will be managed only with a maximum of legal and legalistic difficulty, and that new closed shops and 100 per cent. union membership arrangements will be almost, if not utterly, impossible to make. The thing is a sham. Noble Lords behind the Front Bench opposite should cheer up; union membership arrangements will be more difficult to make than they think.

Thirdly, we come to the area of industrial conflict and what the Bill does. It must be already clear to your Lordships that I take the view that because the 1976 settlement was a modern equivalent of the 1906 settlement, as indeed it clearly was— that is clear to anyone who looks at the case law and extensions of liability— this Bill now tears that compact up in a variety of ways and, in doing so (to make the general point first) it is thought by some of its proponents to have a virtue. The words have not been spoken in your Lordships' House tonight, but I make the point because it relates to what has been said.

It is often said, "We are not making the same mistake this time"— I am not attacking the noble Lord, Lord Carr of Hadley; I am sure he will understand that— "because we are not setting up a special court. It will all be done by the High Court. Do not worry; there will not be a special court which will be perceived as an instrument of class justice or anything of that sort. It will all be done by the High Court". Then one thinks for a moment and looks to the noble and learned Lord, Lord Scarman, in the steel case earlier this year when, thoughtfully, at the end of his judgment, he said, and I quote from page 554 of the All England Law Reports for this year: Open-ended expressions will bring the judges inevitably into the industrial arena exercising a discretion which may well be misunderstood by many and which can damage the confidence in the administration of justice ". There are plenty of open-ended expressions in this legislation, and I hope the noble Earl will reply to this point because it is a very serious one.

This Bill is not only a danger to good industrial relations, it is not only an attack on trade union rights and it is not only a nightmare for a works manager. It is also a Bill which calls into peril the very authority and status of the High Court itself. The law does not have an infinite capital to spend upon enforcing statutes which men feel infringe their inherent rights and rights that they have enjoyed for nearly a century.

Sensible and moderate trade union leaders of experience in the movement— my noble friend Lord Allen of Fallow- field surely made the point tonight— hate this Bill because they join with the American trade union leader Samuel Gompers, who was no revolutionary or militant, who said in 1908: It is our aim to avoid strikes; but I trust that the day will never come when the workers of our country will have so far lost their manhood and independence as to surrender their right to strike. If the High Court is to be asked to do the job this time, then it will be the High Court's capital that eventually may well suffer, and in pursuing a voyage down that road the Government may well have a terrible reckoning to account for when the Bill is in operation.

My noble friend Lord McCarthy has been attacked and criticised on the ground that he said that this was a very technical Bill. The noble Earl suggested at one point— I hope I do not misrepresent him— that if we had positive rights, it would be rather less technical and less complicated, easier to understand. I do not know how many times he has read the National Labour Relations Act of the United States, with all its positive rights. I am not sure that it is much more easy to understand. It may be a little more, because of course what they are putting on the statute book is a nightmare.

Suppose you have a shop steward who asks: "What can I do?" He will remember of course, because he knows his labour history, that this has nothing to do with the winter of discontent. The Conservative Party have been trying to outlaw sympathetic action for the last 40 years. They never really got used to the Act of 1906, because they think that the Act of 1906 was what Lord Halsbury called it in your Lordships' House in 1906: a Bill to legalise tyranny. For the past 40 years they have been saying that they want to ban and prohibit our sympathetic strikes. They said it to the Donovan Commission, the Conservative lawyers, the CBI— all of them. So the matter has nothing to do with the last winter of discontent. But now they have come up with a different phrase: it is now secondary action— an Americanism, but it will serve.

The shop steward asks, "What can I do?" You say, "Well, you say the Government have said"— and here I quote their working paper of 9th July— The law must be described with clarity. " Oh, good! "he says," I would like to hear it. What will I do? "You say this:" You must not induce your members to take industrial action in breach of their employment contracts— which industrial action normally is under the common law— if those employment contracts are with an employer who is not a party to the dispute (and you had better take further advice because he may be a party if represented by an employers' association) and if those breaches will be a fact relied upon to establish liability for an interference with some commercial contract by a person who suffered loss: and that may not be the employer that you are thinking about.

" Then unless you acted with the principal purpose of preventing or disrupting, and could prove to a judge that you were likely to prevent or disrupt directly and not indirectly either (a) the supply of goods or services during a dispute between an employer who is an employer in the dispute and an employer who is not an employer party to the dispute under a subsisting contract between them— not with anyone else; so you had better ask a lawyer where the contract is— or (b) the supply of goods or services from, and not to, an associated employer of the employer in dispute, as defined by Section 30 (5) of the 1974 Act to, but not from, another employer during the dispute, which would have been supplied but for the dispute by the employer in dispute, again directly and interfering with a subsisting contract— unless you do that, then you won't be acting lawfully, with one exception: unless of course you interfere with the commercial contracts by picketing. "

The shop steward says, "I know about that. We have been picketing for years. We have never had any violence around here. This is a normal situation. I know that violence occurs, but we have never been ' done ' for picketing. So I can picket". You say, "No, wait a minute". But he says, "I had the right to picket in furtherance of the dispute. I am only doing it in furtherance of the dispute in the classical sense"— and it has been suggested in your Lordships' House tonight that the decisions of 1980 and 1979 of the Appellate Committee of this place introduced a new meaning to the word "furtherance". That I say is completely false. The meaning of the word "furtherance"has been the same since 1906. It was the Court of Appeal which began to limit it in the late 'seventies.

The man says, "I know about that. I am going to further the dispute". You say, "Wait a minute. You can only picket at your own place of work, and you can be accompanied only by a union official who represents you within the meaning of the new Section 15 (4)".

The man asks, "Where is my place of work? Actually we all work at two factories. Does it include both, because although they are owned by different companies, they are economically really the same unit? "You say," Oh no, you can only picket at your own place of work".

Then he says, "Is ' workplace' defined?"; and you say, "No, because if you look at the debate in another place on 18th March of this year, you will find that the Attorney General said, ' If we try to define "workplace", we shall find ourselves in a most awful mess', whereas the Secretary of State, Mr. Prior, said, ' For the vast majority of people there is no doubt where their place of work is'". So you say, "You know where your place of work is, although it cannot be defined", and he says, "Well, that's all right, but what will happen if some people come from another place? They will not be picketing lawfully". Then you say, "No, they will not be; and you had better be careful not to combine with them, because then you might well— indeed, it was suggested in Committee in another place that you clearly would— be combining with them to take unlawful action, and therefore the whole picket line might run into legal problems".

The noble Lord, Lord Gisborough, quite rightly spoke of the difficulties of identification, because the police have made it clear that they are not going to identify people because they think it has nothing to do with the criminal law. The right honourable gentleman the Secretary of State said at the same sitting: But many of the difficulties "— that is, difficulties about identification which have been envisaged— such as people wearing beards or giving Mickey Mouse names, will not arise ". The noble Earl, Lord Gowrie, has said this evening that there will be no criminal liability. I ask him to repeat that, and to repeat that the code of practice on picketing will have no effect on criminal liability. If it is to have no effect on criminal liability, presumably the Government have changed their mind, because in the working paper on picketing the Government said that the code of practice on picketing would help the interpretation of the law by the police and the magistrates. So let us know about this, because I cannot tell my shop steward whether it is going to have an effect upon picketing in criminal law. What a future for industrial relations, my Lords— the "private eyes" of the employers identifying pickets in beards giving Mickey Mouse names! Absurdities will be brought into industrial relations by ridiculous measures of this sort, which are an attempt to reverse the compact of 1906.

My final point, which is indeed perhaps the most serious of all and of which my noble friend Lord McCarthy spoke earlier this evening, is in Clause 16 (8), because there, in two lines, the Government repeal a part of the 1976 compact which was not needed in 1906. It was not needed because it was never decided until 1964 that a breach of contract was "unlawful means" in the civil law of tort; that is to say, that it could be actionable, for example, by a third party. Once it became actionable as "unlawful means", then, to quote the Master of the Rolls again in a recent case: Anyone who interferes with trade or business and does so by unlawful means is acting unlawfully ". Therefore it is clear that unless a protection is given in trade disputes to a breach of contract as such, as unlawful means in the law of tort, all forms of industrial action are at legal peril.

Indeed, the noble Earl's party knew this perfectly well, because although now they say that in 1974 and 1976 there were great extensions, when they were in the driving seat with their Liberal allies against the minority Labour Government in 1974 they changed Clause 13 (1) and they changed Clause 13 (3) (a), but with all the Lever amendments and all the other one-vote majorities they managed, quite properly, in another place, they did not change Clause 13 (3) (b). If it was such a major extension, why did they not change it then? Why do they come now with a proposal which in two lines will destroy the right to strike?

It is not good enough for a Government to put forward proposals of this sort and to pretend that they fought them in 1974 when in fact, with a majority, they put them on the statute book themselves because they knew they were needed to make the right to strike lawful. As the noble and learned Lord, Lord Scarman, has recently said: Briefly put, the law now "— that is, the law before this wretched Bill goes through on to the statute book— is back to what Parliament had intended when it enacted the Act of 1906, but stronger and clearer than it was then "; and in saying that he refers to a previous passage where he has talked about the judicial extensions of liability.

My Lords, I tell the Government that they cannot expect working people, who face the massive and growing power of both the state and giant corporations, as well as the risk of inflation and unemployment which this Government are putting to them, after a period when they realise what has happened, to have their industrial rights returned to the rights of 1905. For a time, a false story can be told; for a time, the movement can be seduced by constant repetition of the acts of the minority on the television box or in the press; but, after a time, if the Government go ahead with this Bill in this form (and we shall press every line of it in Committee) then, one day, very soon, the shackles will be cast aside and the Labour movement will get rid of the shackles of this Bill as part of its work to restore the consensus and the Welfare State which this Government are destroying.

10.50 p.m.

The Earl of GOWRIE

My Lords, when you have been debating the Second Reading of a Bill for eight hours, there is quite a lot to be said for warming up the atmosphere towards the end. We might all have been a little comatose by this time had not the noble Lord, Lord Wedderburn of Charlton, made his spendid début from the Dispatch Box opposite and the Front Bench opposite. I draw attention to the Dispatch Box opposite and the Front Bench opposite because I would hate to leave your Lordships with any impression that what the noble Lord has given us over 43 minutes— and I will try to undercut him there, if in no other way— has anything to do with official Labour Party policy. It has not; and the moment it becomes so, we will probably have a Conservative Government for 30 years— which even I might object to!

I go from the noble Lord's speech to perhaps almost the best corrective one could make to its general philosophy.

Lord McCARTHY

My Lords—

The Earl of GOWRIE

I will give way later. I want to make a remark about the maiden speech. One of the best correctives that could have been made to the spirit of the speech of the noble Lord, Lord Wedderburn of Charlton, happened earlier, in the maiden speech of my noble friend Lord Keith. Speaking as a manager, he praised the Bill for its commonsense and said that the lessons of the last 12 years have shown that sweeping changes in trade union law achieved all at once have not always been effective. He said— and this is the point that I would draw to the attention of the noble Lord, Lord Wedderburn of Charlton— that there was strong evidence of public support for the changes achieved in this Bill. Lord Wedderburn reluctantly conceded that; and tried to deflect that public support on to the media. The point that I tried to make to him was that the media have felt two ways about this Bill. Many sections of the Conservative press have felt very hostile towards it, very critical of it, for not going far enough; and relatively few newspapers, whatever their political persuasion, have attacked it as being a fundamental attack on the primary, legitimate trade union activities of the sort that the noble Lord, somewhat sophisticatedly, I thought (in the old meaning of the word), represented it as being a few moments ago. I hope to take up some of the points that the noble Lord made. He said, "We will fight the Bill line by line". I wonder whether that includes the new statutory rights for antenatal care. I look forward to returning to the issue at a later stage of the Bill.

We had a lively speech from the noble Lord, Lord McCarthy, as one would expect from someone who, I understand, won the Observer debating trophy and published a PhD thesis on the closed shop in the same year. He asked me whether repeal of Section 13 (3) of the 1974 Act would not have removed some of the immunity from primary action, the basic rights or basic immunities, of trades unions. This was partly behind some of the objections of the noble Lord, Lord Wedderburn of Charlton. I am advised that the clause does not affect the immunity for primary action which Section 13 of the 1974 Act, as amended, provides. The repeal of Section 13 (3) is necessary only to make it clear that an employer can seek an injunction where there is unlawful secondary action. My speech made it clear that we do not intend to cut into the quick of legitimate union activities. The noble Lord, Lord Wedderburn, is arguing that whether we intend to do so or not, we are doing so. That is the point where we disagree with him. It is certainly not our intention to do so.

Lord KALDOR

My Lords—

The Earl of GOWRIE

I will give way, but I would draw attention to the lateness of the hour.

Lord KALDOR

If what is intended in Clause 8 is what the noble Earl just said, all it needs to clarify it is to add the words: for the purposes of this section ".

The Earl of GOWRIE

I am sure, my Lords, that the noble Lord will put down an amendment to that effect, and I will certainly look at it. As I said in my speech, this is a Second Reading area; it is not our intention to cut into primary action in this way.

The noble Lords, Lord McCarthy, Lord Plant and Lord Wedderburn, asked us how judges would decide what the principal purpose of secondary action would be. The noble Lord, Lord Plant, asked: "Does not the clause put the courts in the position of what the noble and learned Lord, Lord Scarman, in a judgment called, the ' back seat drivers '? "Of course the courts are going to have to apply the new provision to the facts of any case that is brought before them. As a number of noble Lords have said, it is idle to think that courts can be kept altogether out of industrial relations, though we aim to see that their activities are at a minimum there.

Under the new clause, the courts will have a specific task of determining on the evidence presented to them whether the purpose of the secondary action is to disrupt supplies between the employer in the dispute and his customer or supplier, and whether it is likely to achieve that purpose. The noble Lord, Lord Wedderburn, with great brio — and I enjoyed it— used the old debating formula of taking a set of legal, rather tightly and perhaps rather stuffily drawn provisions, and translating them into the language of the shop floor. But one can do that equally well with his golden formula. I would have thought the courts have found equal difficulties in interpreting the so- called golden formula which says: in contemplation or furtherance of a trade dispute ". We have now a House of Lords' judgment to say that that is purely a subjective measure and therefore impossible to apply as useful law.

A number of noble Lords asked me whether the Green Paper on immunities would be the prelude to much further legislation. I share the view of the noble Baroness, that it would be undesirable, if we can conceivably avoid it, to have additional legislation. The point of the Green Paper is to get to the debate which the noble Lord, Lord Wedderburn— if he would be so kind as to attend to me— mentioned at the very beginning of his speech. He said I had fairly represented that we have a curious— let us put it in a neutral way— history in this regard, and we think there may be a case for altering our general approach, and that is why the Green Paper would have discussion about the principles of rights in law as against the principle of immunities in law. If I may say so, I thought that that point was very brilliantly answered by my noble friend Lord Mottistone.

The noble Lord, Lord McCarthy, asked me about the position of trade union officials on the picket line. He said that it was not clear in the Bill. It is perfectly clear: a trade union official may picket peacefully at his own place of work and at another place of work when members of his trade union whom he represents are picketing lawfully there. I do not see anything difficult about that. If the noble Lord finds it difficult, no doubt he will put down an amendment and we can clarify it.

A number of points were made about the issue of small firms. Both the noble Lords, Lord McCarthy and Lord Wedderburn, were sceptical about surveys, and challenged me about the results of surveys, about the disincentive effect in small firms. I might say, incidentally, that if noble Lords are so keen on surveys perhaps they would like me to send them copies of all the polls and surveys of trade union opinion which indicate the support for the measures of this Bill among the rank and file.

I should like to quote a letter from a not highly politicised source— the Scottish Development Agency in Edinburgh— who wrote to my honourable friend the Under- Secretary in our department: The general story that we learned in Scotland at the time of the provisions of the Employment Protection Act was that firms were unwilling to engage staff when the Act was so heavily weighted in favour of employees, making it difficult to discharge people except under threat of financial penalty should business decline. But having given that piece of, if you like, anecdotal evidence, I do go a considerable way with the noble Baroness, Lady Seear, when she says that the effects on small businesses of the last Act were primarily psychological. That is why our amendments to the Act are extremely minor, even in the cases of the maternity issue, which has caused some excitement. They are very minor indeed, and they are there to try to correct the psychological imbalance.

Lord HOWIE of TROON

My Lords, will the noble Earl tell us whether the comment from the Scottish Development Agency was made before or after his Government changed the chairman?

The Earl of GOWRIE

My Lords, I do not have that advice to hand. All I am saying is that this letter was received and I offer it for what it is worth. The noble Lord is perfectly at liberty to challenge it and say that it is all nonsense, but the fact is that a perfectly reputable development agency gave us that opinion.

I want now to come again to further points made by the noble Lord, Lord Rochester, and I welcome his general support for the Bill, as I do that of the noble Baroness beside him. The noble Lord said that voluntarism is no longer a credible proposition. I do not think he was throwing voluntarism overboard entirely, and he gave a plug to the principle of codes of practice. But he nevertheless felt that it must be underpinned by law.

On the closed shop he did say: "I have enough practical experience of industry to know that it is not as easy to prohibit it as it might appear". I would be most obliged if he would tell that to his right honourable friend Mr. David Steel. If I may indulge in a brief anecdote, the Secretary for Labour in Mr. Carter's administration in America recently came over here, and I said, "We have a lot of trouble and debate and false alarms and excitements about the closed shop in this country. You were rather sensible to get it out of the way with the Taft-Hartley Act of 1947." Secretary Marshall said to me, "We may have outlawed it in Taft- Hartley, but we could not do without it ". Our anxiety has been all along that we do not want to drive the closed shop underground in order that the kind of protections for individuals which the Bill seeks to provide and which I would say to my noble friend Lord De L'Isle we believe that the Bill does provide, are driven underground as well.

The noble Lord, Lord Harris of High Cross, made a broadly supportive speech. He pointed out the many advantages of the German trade union law. In our department, on the way to my office, there is a bust of Mr. Ernest Bevin. I was always brought up to believe that it was Mr. Bevin who created the German system of trade union law, rather contrary to the noble Lord's point of importation, in order to escape from some of the curious history of our own. Nevertheless, be that as it may, one of my ambitions during my tenure as Minister in the Department of Employment, is to get equal time with Mr. Bevin by getting a bust in there of my late noble friend Lord Monckton of Brenchley.

I want to address myself now to the very powerful speech of my noble friend Lord De L'Isle on the issue of the European Court. We have always had profound sympathy for the three ex- British Rail employees, and I want to make that unconditionally clear. We vehemently resisted the last Government's legislation which left them without a remedy when they were dismissed. The Bill will ensure that in future similar cases to theirs will not be denied a domestic remedy. Under the rules of the convention we are not at liberty, as the noble Viscount knows, to reveal the contents of the commission's report, though this should be available in the next few weeks, now that the commission has referred the matter to the Court of Human Rights. But I can say to the noble Viscount that we are convinced on good grounds that when the present Bill becomes law we shall be meeting the standards of the convention.

The noble Viscount said that compensation in closed shop issues was not an adequate remedy. This is a matter specifically for Article 13 of the convention and it will, I understand, be covered in the commission's report. Our view is that compensation is the only practical remedy in this area and successive Governments have recognised this. The point is that it is not practical to force unwilling partners to work together, and that has always been implicit to the law. If the noble Viscount will do me the kindness of taking that statement, when he reads Hansard tomorrow, and combining it with our anxieties about driving these practices underground, he may be able to come a little nearer in spirit to us. That is certainly where we should like to find him.

I must congratulate the noble Lord, Lord Robbins, on a brilliant defence of the open society. He said that it was a virtue of the Bill that it is not all-embracing. My noble friend Lord De La Warr asked about the problem of the revolving pickets— "the here-today-and-gone-tomorrow-picket"— and that also caused concern to my noble friends Lord Orr-Ewing and Lord Gisborough. We anticipate that an employer whose business is being damaged by secondary picketing will seek an injunction against the organiser of the picketing. The organiser will not usually be difficult to identify because effective secondary picketing needs careful organisation: it is rarely anonymous or spontaneous. Injunctions are usually granted against a named person and his agents or servants, so that an injunction sought against the organiser will usually apply to anyone picketing on his behalf. Anyone who, knowing of the injunction, disobeys it and continues to picket is liable to be held in contempt of court, and that is a serious offence which the courts themselves will punish. I would point out to the noble Lord, Lord Kaldor, that he must make a distinction between going to jail for striking and going to jail for being in contempt of court. Therefore it will not be possible, in our view, for a picket organiser to get round a court order by the stratagem of replacing one set of pickets by another— that is to say, by using "rotating" pickets.

The noble Lord, Lord Carr, made the speech which, if I may say so, most interested and moved me this evening. Luck plays an enormously important part in politics, and two measures in the Heath Government years— the Sunningdale Agreement on Northern Ireland and my noble friend's Industrial Relations Act suffered the bad luck of getting embroiled in a general election on a somewhat different issue. My noble friend asked me whether the Bill was not proceeding too much against individuals as opposed to against trade unions or organisations generally. We feel that the best way to proceed is by injunction against persons, because a good example of an injunction being sought and observed was the recent case involving the private steel producers v. Sirs and others. The injunction was sought against the organisers of the strike— Mr. Sirs and other members of the executive. It was immediately obeyed in the trade union tradition of obeying High Court orders, and the strike was called off until the House of Lords overturned the decision. There was a recent comparable case concerning Express Newspapers in respect of the Day of Action.

The noble Lord, Lord Hankey, complained that we were treating with this Bill now. I think he would prefer to have been handling it last autumn. As I explained in my opening speech, we were determined to consult at every step of the way; and I must say to the noble Lord, Lord Wedderburn, in this context that the strength and vehemence of his objections are not what we have found in our ordinary consultations. I will, of course, look at everything he says with an open mind. The noble Lord, Lord Howie of Troon, made an argument on the closed shop in special circumstances. We do not believe that the professional employee he has mentioned and whose dilemma he posed requires protection additional to that already given by the Bill. If he has a deeply-held personal conviction based on his professional code of ethics against joining a union which may require him to go on strike, he may have an objection on grounds of conscience within Clause 6. If he has no objection to joining a union but when required to take part in a strike refuses to do so, then Clause 3 protects him from unreasonable expulsion from the union. So we think that the three points raised by the noble Lord, Lord Howie, are covered. But if he is not satisfied with them— I have a longer answer here which I am truncating— I will either write to him or encourage him to put down an amendment and deal with it at a later stage.

Lord HOWIE of TROON

My Lords, I am grateful for the noble Earl's encouragement.

The Earl of GOWRIE

My Lords, the most purely pleasurable moment I had during the debate was when I caught the eye of the noble Lord, Lord Wedderburn, when my noble friend Lord Renton said that he was the only lawyer speaking in the debate. My noble friend was uncertain as to whether we had kept to our manifesto commitment. Part of our argument is that we have not proceeded any further than we said we would go, and that that is the best way to proceed. I hope he will be convinced of that as the Bill proceeds in Committee.

My noble friend Lord Massereene and Ferrard asked about the methods of codes of practice and whether they would come before the House. The Affirmative Resolution procedure does allow for parliamentary input, and we will see that the codes get it. My noble friends Lord Orr-Ewing and Lord Gisborough mentioned picketing and demonstrations. It is not difficult, in our view, to distinguish between demonstrators and pickets. The crucial question is not whether a person is demonstrating, but whether he is inducing a breach of contract; that is, whether he is stopping people from going to work or lorries from collecting or delivering goods. If he is inducing a breach of contract, there will be no immunity unless he is picketing at his own place of work.

I think, in one or two interventions I made to try to correct some false impressions, I dealt with the maternity point. I would just remind your Lordships that, in the case of the very small business being able not automatically to be obliged to reinstate a lady after she has had a baby, the onus is entirely on the employer to show that it is not reasonable for him to do so. I should have thought it was equally sexist to discourage the hiring of women of marriageable age, by the provisions of the law as they presently exist.

On the vexed and difficult issue of secondary blacking, which I agree with my noble friend is complex, we have always made it clear— and this leads me naturally to my last point on the matters raised by the noble Lord, Lord Wedderburn— that we intend to maintain the historic immunity for inducing breaches of contract of employment, first established in 1906. What we object to is the unlimited immunity for inducing breaches of commercial contracts which, in our contention, the last Government introduced, and which opened the way for indiscriminate secondary action to damage the businesses of those not involved in a dispute, thus spreading the disruptive effects of a dispute far and wide. We are trying to get to what I would, in shorthand, call the "Denning doctrine of remoteness".

The noble Lord, Lord Wedderburn, asserts that, in fact, the immunities for calling industrial action are now, as a result of the 1976 Act, in the same position only; that they have not been extended; that they have simply gone back to the 1906 Act and that the extension of the immunity for inducing breaches of contracts of employment to breaches of all types of contracts was, indeed, in the spirit of the 1906 legislation.

The noble Lord is a very great expert, but I do not think he altogether understands the real world in which Acts of Parliament are practically put into effect. Whatever the words of the statute may say— and we will have argument about this in Committee— there is a world of difference, surely, between the practical effects of the immunity, as it operated when Mr. Asquith's Government designed it, and as it operates today. It is, as it were, a modification of the operational excesses of this law that we are concerned to see happen. The legislators of 1906 could never have foreseen the development of flying pickets, so they could never have anticipated the extent to which other forms of industrial action, such as blacking, would be used to spread disruption far beyond the parties originally in dispute. That is the simple correction that we want to make.

Even on a matter of law, it is quite wrong to assume that nothing changed in practice between 1906 and 1971. Any trade union leader who was active in the 1950s and 1960s would tell you that the courts looked very carefully at cases involving breaches of commercial contracts, and certainly did not take the view that immunity depended altogether on the state of mind of the person who induced the breach of contract. Why is there so much support for these changes, and why is there no real commitment to repeal them?

On the issue of wages councils which I administer in this Government, they do, indeed, cater for the genuinely low paid. But Schedule 11 helped to give the relatively high pay comparability increases to BBC staff under the last Government. That was not what the schedule was originally designed to do. We want to get back to a voluntary system, and we think that Schedule 11 is standing in the way there.

Finally, I would say to the noble Lord, Lord Wedderburn of Charlton, that the code will not create new criminal offences; it will simply explain the existing law, including the criminal law. What we have been talking about this evening is the civil law. In sum, we have restored the right of workers to claim unfair dismissal if they are sacked through the improper imposition and operation of the closed shop. We have restored the right of an employer to seek a legal remedy in the civil courts when his business or livelihood and the jobs of his employees are threatened by secondary picketing; we have put strict and specific limitations on the immunity for spreading industrial disruption far and wide beyond those directly concerned in the dispute, and we have removed the immunity for coercive recruitment tactics, such as those employed by Slade. I look forward to detailed work on the Bill and expect to learn a lot, but I believe that these essential and modest reforms are long overdue.

Lord McCARTHY

My Lords, before the noble Earl sits down— he is a fair and reasonable man— can he help me? I listened with great care to what my noble friend Lord Wedderburn of Charlton said. Indeed, I had prior knowledge of much of what he was going to say. I could not see any way in which he went beyond the position adopted by the Labour Party in Committee and in the House in another place. I should like the noble Earl either to tell us specifically where he went wrong on this or to take back that remark.

The Earl of GOWRIE

My Lords, I have no intention of withdrawing the remark. I made it as a form of congratulation to the noble Lord, Lord Wedderburn of Charlton. I find his opposition a great deal more robust than I found it when following the different stages in another place. I was trying to pay the noble Lord a compliment. There is no need to throw it back in my face.

Lord WEDDERBURN of CHARLTON

My Lords, I thank the noble Earl for paying me a compliment, but may I—

Several noble Lords: Order, order!

Lord PEART

My Lords, I think that my noble friend ought to be able to reply quickly.

Lord SANDYS

My Lords, this is quite out of order. The noble Earl has sat down.

Lord WEDDERBURN of CHARLTON

My Lords, the noble Earl was asked a question before he sat down. Will he answer it? Will he answer the question which arises out of what was said by my noble friend Lord McCarthy?

Lord SANDYS

No, my Lords.

On Question, Bill read 2^a, and committed to a Committee of the whole House.