Employment Bill

HL Deb 06 July 1982 vol 432 cc729-61

House again in Committee.

Clause 2 [Dismissal for non-membership of union]:

Lord Wedderburn of Charlton moved Amendment No. 14: Page 2, line 13, leave out ("or of a particular trade union, or of one of a number of particular trade unions,").

The noble Lord said: So far in Committee, your Lordships have been discussing the past. Clause 1 and Schedule 1 enshrine the rather peculiar provisions the Government wish to make about events that lie in the past; events which we have suggested would look very different if they could be seen in the light of the evidence which exists, which, unhappily, is not yet available from the Government commissioned research. But now, in Clause 2, your Lordships are asked to look to the future with the Government—to see what they want to do with trade unionism in the future.

In many ways, Clause 2 is one of the most important provisions in the Bill. If I may quote the Secretary of State, Mr. Tebbit, on Second Reading in another place on 8th February this year, at col. 742 of the Official Report, he summed up—in a way that, I think, will not be in dispute between these Benches and the Government—the effects of the clause and, indeed, of this part and some other Parts of the Bill. He spoke of Clause 2 providing wide-ranging rights against unfair dismissal for the non-union employee in a closed shop and summed it up as follows: It"— that is, the clause— considerably extends the right not to be unfairly dismissed for non-union membership. I have no hesitation in saying that when the Bill reaches the statute book it will provide the most comprehensive and the most effective statutory protection for non-union employees that we have ever had in this country.

In a sense, that sums up the case that we have from these Benches against this Part of the Bill. It is not a question of injustice done to individuals and I, at least—and I am sure that my noble friends will be with me in this—say that, if in justice is shown in an individual case, then it should be remedied. Again, I declare an interest as chairman of the Independent Review Committee of the TUC, in which we have tried to do that in such cases as have come to us—and there have been many.

But if you base your policy upon the promotion of non-unionism—that is what this clause begins to do—then you put at risk all the advantages which employers, Government and workers in the past have found to come from the system of trade unionism, and of collective bargaining as a whole. It is that risk which this Bill now clearly enshrines—more clearly than the Act of 1980.

Coming to the amendment, it relates to Clause 2 which re-enacts Section 58 of the 1978 Act. The 1978 Act provided that it should be automatically unfair to dismiss an employee on the ground that he was a member of an independent union, or that he had taken part in its activities, or that he refused to become a member of a union that was not independent. The first part—dismissal for trade unionism—is retained in, more or less, the same way and it is necessary to say a word about that. It is the second part which is changed, where the last proposition is replaced by a proposal that it should be automatically wholly unfair, whether or not there is a closed shop, or in any situation whatever, to dismiss a worker on the ground, and for the principal reason, that he is not a member of a union, or of a particular union, or of one of a number of unions, as the new Section 58(1)(c) would provide.

Taking these points in order, every modern system of labour law in comparable societies in, for example, Western Europe, provides for protection against dismissal by those who organise trade union activities. It is true in France, it is true in Italy, it is true in Germany and it is true in Sweden. If I may quote, as a very simple rationale of this position, the work of Professor Schmidt on Law and Industrial Relations in Sweden, he wrote at page 74: As the representative of the workforce, these representatives have been considered in need of stronger protection than the rest of the employees. That is common throughout Western Europe—it is not special to us, and we were rather late in getting there—because if you allow a union representative to be picked on, whether the employer is sympathetic or not (harking back to a previous debate) then no one will get on with the business of collective bargaining as a representative of the workforce.

We enacted a somewhat wider provision in 1975, that anyone taking part in the activities of an independent trade union should be so protected, and the reason we did that, and did not enact what the Government now wish to enact, may be gathered from the Donovan Report in 1968 at paragraph 599—and I quote the Donovan Report as something which all administrations so far have accepted—which stated: It might be argued that the closed shop should be prohibited. As part of the argument for prohibition, it might be said that, since we suggest that any condition in a contract of employment that an employee shall not join a union should be void, it would be right to treat in the same way a condition that a worker shall join a union. However, the two are not truly comparable. The former condition is designed to frustrate the development of collective bargaining which it is public policy to promote, whereas no such objection applies to the latter.

That is a fundamental proposition from which the Government are now departing; that is to say, the Government are now being guided not by the principle of the Donovan Commission's report, not by the principle that applies in most other systems of Western European law—although I shall have a word to say on that in a moment—but by the new principle, which was propounded by the Under-Secretary of State in the other place on 23rd March 1982, at col. 653 of the Official Report, when he spoke about the refusal of the Government to derogate from the absolute right not to be a union member even when there is a closed shop He used the phrase "absolute right not to be a union member" on many occasions.

The Government are wedded to the principle of an absolute right not to be a member of a trade union, which, of course, goes far beyond the Strasbourg judgment and far beyond any of the other sources upon which they rely in this respect. Indeed it goes very much further than the Secretary of State himself adhered to in 1975 when, in the debates on what became the 1976 Act, he said on 9th December 1975 at col. 330 of the Official Report: As for free riders, I do not like them in any place. I would welcome any arrangement under which those who did not wish to belong to a union still paid subscriptions to the union—not even to a charity—for the work the union carried out on behalf of its members and others.

This change of tack by the Government is new. The new Section 58(1)(c) in Clause 2 is the one to which this amendment is directed. It is an amendment moved in the knowledge that we are unlikely at this late stage to turn the Government's head from the head-long path that they pursue in pursuit of the absolute right of a worker not to be a member of a union. It is an amendment which asks them to think again in one particular respect.

Your Lordships will see that if the principal reason for dismissal is that an employee is not a member of a union, it is automatically unfair. But it is also automatically unfair if he refuses to be a member of a particular union, or refuses, or proposes to refuse, to become or remain such a member. Those words in lines 14 to 17 on page 2 of the Bill immediately interact with the question of multi-unionism in Britain.

The Government have taken due account of the fact that multi-unionism exists in Britain. In Clause 15 of the Bill they finally polish off, as trade disputes that allow for industrial action, disputes between workers and workers. One of the reasons given is that they do not think that inter-union disputes should be allowable as trade disputes. We shall come to that clause. If that point be right, is it not the case that this clause necessarily encourages breakaway unions and increases multi-unionism—at any rate, in prospect?

To take the case of an inter-union dispute, the fact that somebody is in no circumstances whatever allowed to be dismissed because he refuses to join a particular union, or insists on remaining in a particular union, in all circumstances whatever, gives management no part, or very little part, to play in the enforcement of arrangements to avoid the disadvantages of multi-unionism. I say immediately that the amendment which I move relates also to Clause 9 where a similar point arises. The Government are quite logical in denying the employer the right to take not only dismissal action but any action short of dismissal which has the same effect. That is the effect of Section 23 of their 1980 statute and of Clause 9 of the Bill.

Let us take a concrete case which came recently before the Employment Appeal Tribunal. In the case of Rath v. Cruden Construction Limited in 1982, reported in the Industrial Relations Law Reports, page 9, there was a worker who was a member of the United Construction and Allied Trades trade union. He alleged that the reason for his dismissal was that he had insisted on remaining within UCAT. Pressure had been put on him to move to the Transport and General Workers' Union. The law report is not clear exactly why; we shall come to that in a moment. His complaint was that he had been dismissed contrary to paragraph (a) of Section 58(1), as printed in the Bill. On this occasion the Government have had the kindness to reprint the whole section on pages 2 and 3 of the Bill, for which I am sure all noble Lords are very grateful.

Section 58(1)(a) deals with dismissal on grounds of trade unionism. The Employment Appeal Tribunal held that he was not dismissed in breach of Section 58(1) (a); the reason why he had been dismissed was that he would not move—not that he stayed where he was. This is a lawyer's point. The further we go with the Bill we shall see that if anybody thinks that this Bill, like the previous one, will not give a great deal of employment to lawyers, they are much mistaken—if, of course, we get the recession out of the way and a bit of an upturn so that people will have some money to pay legal costs. However, that was the decision in that case. It is an arguable case. It would go the other way if the Bill is passed in this form.

Let us test that in relation to the Trades Union Congress disputes principles and procedures. Suppose, in the Rath case—I admit that the law report does not make it clear that this was the case but it would be rather surprising if it was not— that there was an inter-union agreement, perhaps also an agreement with the employer, and perhaps an agreement to observe the Bridlington principles, that workers in a particular area, job, craft or grade should belong to the one union rather than the other. If the Bill is passed, Mr. Rath will have a remedy. Is that what the Government want? Do the Government want to give a remedy to a worker, no matter the other considerations, even if the employer says, "Thank heaven for the TUC disputes principles and procedures, because he says, No, I won't move"? So if he is dismissed, or if—I take the point now because it is logical to do so— he is not dismissed but if in the short term action short of dismissal is taken against him— he is suspended or he is put on another site— he may be dismissed if he complains about that. Is that the kind of structure which the Government are putting to the country at this point?

Whatever other defects the trade unions of Britain have, I say that the unions affiliated to the TUC are the only bodies which have done anything effective during the last 30 years about multi-unionism in this country. If there is any evidence of any other body, other than a few employers' associations and employers, who have co-operated in that process, let it be put on the table. This is the kind of procedure which would ruin the TUC disputes principles and procedures.

Let me take Principle 5—one which sometimes causes a bit of aggravation between one affiliated union and another—of the TUC disputes principles and procedures, though it is sometimes called the Bridlington principles from the Bridlington Congress of 1939: No union shall commence organising activities at any establishment or undertaking in respect of any grade or grades of workers in which another union has the majority of workers employed and negotiate wages and conditions, unless by arrangement with that union". That seems to be a very sensible thing to try to operate. It is run much better by the voluntary procedures of the TUC than it would be by a statute. One would have thought that the Government might at least, however much they approve of non-unionism, have given some support to that situation in an inter-union context. But so blinded are they by their pursuit of the idea of the individual necessarily having a choice, that they put before your Lordships a statute which can mean nothing other than an increase in trade unionism — at any rate, so far as management is concerned, because management will go to the unions concerned and say, "We are very sorry; we should like to see that put into effect but we can't help you".

The events of the last few weeks have made that doubly important because management now has a much more serious role than it had two weeks ago. On 19th June 1982 the majority of the Court of Appeal held that the whole Bridlington arrangement was void and contrary to public policy. That case is going to the Judicial Committee of your Lordships' House. I do not know what will come about, but one must discuss it now on the basis of the law as it is; and the law as it is today, by two to one in the Court of Appeal, is that the Bridlington procedures are contrary to public policy. The TUC, no doubt within the law, will try to get the same result by other means— in other words, will try to get common sense round the bargaining table.

Is this a clause which supports the judgment of the Master of the Rolls: that it was said that the trade union rule was necessary to keep order in industrial relations and that if it were not for the Bridlington principles there would be chaos? Then the Master of the Rolls went on: Even though it should result in industrial chaos, nevertheless the freedom of each man should prevail over it". I cannot believe that the Government wish to enact a clause that enshrines that very principle. There are limits on individual choice and one would have thought that industrial chaos was something the Government should not pursue, even in the pursuit of individual choice. Yet this section as it stands is very much in that same genre.

It is with great difficulty that one tries to imagine the Government really meaning what they say in the words which this amendment moves to leave out of the clause. We want to move out only the part, not about non-unionism as such, because we understand that they are wedded to that— mistakenly we think, but we will debate it later— which must face a management that has 17 unions to negotiate with today (hopefully, in a joint negotiating committee) and 23 unions tomorrow. One would have thought that that was absurd.

A final point about the nature of the clause, and therefore the nature of the amendment: the clause says that a dismissal on the grounds of refusal to move from one union to another or anything connected with that is automatically unfair. Thereby, it pre-empts two points, not one. In an unfair dismissal case, the employer is faced with two points to win. The first point is that he has a substantial reason for the dismissal, such as conduct or lack of capability. The second point is that he is being reasonable in adopting dismissal as the appropriate sanction. It' the Government had put forward a clause which said that refusal to move from one union to another or that, as a principal reason, a worker not being a member of one of a number of particular trade unions was OK for the first point, but that it was still left to the employer to show he was being reasonable, I would not have agreed with it but I think I could have understood it. In other words, that would have got the employer half-way. Then he would have to show that it was reasonable and then the tribunal, as tribunals do, might take account of the inter-union position. But the nature of the clause is that the tribunal is shut out from looking at the inter-union relationship. It can take account of the compensation it awards because of the conduct of the employee if he contributes to his own dismissal, and we shall hear a lot of that throughout this clause. But that is not the point; it goes only to quantum of damage.

It is extraordinary if the Government will not accept this small amendment, think again at least about the inter-union problems which are involved in the present situation of multi-unions, and take out of Clause 58(1)(c) the part that relates especially to that inter-union difficulty with which trade unions have been struggling, in many ways successfully, for a number of years. Many managers on the shop floor, I am quite sure, will see the provision as putting the clock back in many respects as far as their day-to-day working is concerned, both in regard to dismissal and, perhaps even more important, in regard to action short of dismissal. I beg to move.

8.44 p.m.

Lord Mottistone

I have listened with great interest to the extraordinarily long speech made by the noble Lord, Lord Wedderburn of Charlton. I have found it so difficult because many of the matters to which he made passing reference were real problems that one has experienced and recognised, and I tried terribly hard to relate what he said back to what the amendment and this particular part of the Bill are all about, but I just could not do it.

We listened for 22 minutes and I found myself unconvinced. This shows that I am terribly dumb and frightfully inexperienced, despite the fact that I have spent much of my life dealing with questions of this sort; but that really does not matter in the modern world of industrial law because it is obviously in that area that one ought to have experience. I hate to say this to the noble Lord, Lord Wedderburn of Charlton, because he was trying so hard, but the net result of his efforts was totally unconvincing. I am very sorry about that. If he could have said it all more simply for simple folk, as many of us Lords are, maybe we should have understood; and if the noble Lord had spoken more slowly and carefully, and had not shouted at us, that might have helped too.

Lord Campbell of Alloway

May I to some degree come to the rescue of the noble Lord, Lord Wedderburn of Charlton.

Lord Boyd-Carpenter

He needs it.

Lord Campbell of Alloway

I understand his concern about the absence of recognition machinery for inter-union disputes. It is a serious matter. It is, in submission, a serious defect under our present structure of law, and it is something to which I adverted on 15th June, I think it was, on Second Reading. So it is not something that I have dreamt up as a salvage operation. But this is where we part company. The noble Lord is confusing the absence of recognition procedure with the subject matter of this amendment and this has made the whole presentation very difficult to understand.

On the recognition aspect, never mind what the Court of Appeal said the other day. Bridlington has been as dead as a dodo for decades and everybody knows that. What we need is a proper recognition procedure under the Act of 1971, which, as I am sure the noble Lord, Lord McCarthy, would agree, was one of the parts of the Act that worked reasonably well and to reasonable satisfaction; it was one of the few parts of the Act that was generally acceped to have worked well.

Coming to this amendment, all this dissertation on recognistion procedure is a red herring. The spirit that moves the Government here is not open to criticism. It is the spirit of the majority decision in the railways case, if not the letter of that decision according to a reasonable interpretation of Article 11 of the Convention on Human Rights. That is applicable throughout the European Community and which, being supranational law, obliges each member state in due course to conform to the international principles.

Who could care more or less about what happens in Sweden, if I may put it that way? What matters is what happens within the remit of our own national and international law assumed by treaty obligations. Within that, this Government have faithfully sought to follow the right principles.

Lord Houghton of Sowerby

I put individual liberty very high indeed in the free society, but, as I said earlier, the right of the individual may reach a point where he must have regard to the rights of other individuals. In other words, he must come to terms with his environment, especially when he chooses that environment for himself. I find myself in sympathy with the case made out by my noble friend on this amendment. We must bear in mind that throughout the piece the right of the worker with a conscience or a deeply-held personal conviction is upheld. That is in this clause. So we do provide for the strong personal reason for not wanting to belong to a trade union or a particular trade union.

But apart from that and short of that, we have to look at the position of the individual who may exercise his absolute right in any circumstances not to belong to a union. We have to have regard to that in relation to the harmony of the undertaking, the rights of other individuals, the employer who wishes to conduct his business in an acceptable way. All that has to be taken into account. I must say from personal experience how bitter the rivalries between unions can become, and how strongly they feel about poaching, or members being in a union which is seeking a bridgehead in a particular organisation from which to expand their probably disruptive influence over the workforce. These are very important matters indeed. So I would not concede to the individual the absolute right in any circumstances not to belong to a union, and that is the principle which the Minister in another place defined as the purpose of this clause.

We come a little later to the question of ballots on closed shops and so forth. But this amendment relates to a very important principle. I am glad, if I may say so, that we are now on the future and have done with the past. I think that up to a point one should let the past bury their own dead— that is not the absolutely correct quotation but, still, it will do. We are now on the future. We have to lay the foundations soundly.

It has not really been mentioned in this context, but in present circumstances we are in the most inappropriate time to be discussing matters which arouse deep feelings among the trade union movement. It would have been so much better had we had more tranquil conditions in which to discuss these matters more objectively and without the emotional undertones that are now running right throughout the trade union movement. The trouble is that even moderate trade unionists feel that the Government are attacking the trade union movement, that they are against it and are seeking to weaken it. I do not associate myself for a single moment with some of the more extreme denunciations of this Bill which have been made by trade union leaders; I think they are exaggerating. But they are an indication of the attitude of trade union members towards the Government's proposals.

So I think we do have to study very carefully indeed what we are doing in this clause. I support this amendment, which I hope will not give my noble friend too much of a shock, because I think his reasoning in the matter and the arguments that he brought to the Committee were comprehensive and I thought very persuasive indeed. So that, for what it is worth. is my own opinion on this particular matter.

Lord Jenkins of Putney

I do not like this Bill and I do not like this clause and I do not like this subsection of the clause. I think what my noble friend has sought to do is to make this subsection (1)(c) of the clause just a shade less objectionable than it would otherwise be. He has sought to create a position in which this Bill will not create dissent, discord between employer and employee— because that, I am afraid, is inevitable under the Bill as it stands and not much can be done about it— and he has sought to remove one of the causes which might create friction between one union and another. That this, apparently, is not understood on the other side of the Committee I find extraordinarily hard to understand. It seems to me that my noble friend in his exposition of what he was seeking to do was clarity itself. Why it was that noble Lords opposite were unable to grasp what he was about, I found difficult to understand. Indeed, when the noble Lord opposite came to his aid, I personally would rather not be assisted in that manner, if I may say so.

Lord Campbell of Alloway

The noble Lord will not be.

Lord Jenkins of Putney

I hope the noble Lord, Lord Wedderburn, felt assisted by the noble Lord. I beg leave to doubt whether he did. I did not feel that he was being assisted, but I am trying to assist him a little hit now, if I may.

I think the object my noble friend seeks is a question of order. If one creates the position in which unions are going to be in effect in competition with each other, in an area in which hitherto one trade union has occupied the area, one creates a position in which conflict can occur. It seems to me that the simple object of this amendment, which I hope the Committee will decide to support, is to remove one area of conflict. That, surely, is something which ought to commend itself to the whole Committee.

The Minister of State for Defence Procurement (Viscount Trenchard)

The noble Lord, Lord Wedderburn, started by quoting from the remarks of my right honourable friend the Secretary of State in terms of where this Bill would take legislation in this country, which were words the noble Lord used. He went on to suggest that this represented the Government view, a determination to promote non-unionism. I cannot accept either of those two propositions. My right honourable friend the Secretary of State has made clear on a great many occasions that he is seeking in this country what we believe is a better balance. Certainly from my own experience I know that the balance in other countries in the closed shop respect is very different. Things have moved on since Donovan, which is a good many years ago, and we believe that changes are necessary.

To turn to the particular amendment which the noble Lord moved within the context of his general remarks, Section 58(1)(c) protects the right of an employee not to be a member of a trade union outside a closed shop situation. It protects his right inside a closed shop situation, but only as covered by the provisions of subsection (3). In this respect the Government believe that the nature of Section 58(1) (a), (b) and (c) is entirely neutral. There is an absolute protection for any employee to join an independent trade union, to take part in the activities of an independent trade union, to take part in the activities of an independent trade union, or not to belong to one, including situations outside closed shop.

The noble Lord made a point about the Under-Secretary of State's remarks in Committee when discussing this particular clause. But there is of course the right contained in Clause 3 for a proper closed shop agreement to be negotiated, and we shall no doubt move on to that at a later date. The reason for these words which the amendment seeks to remove is that it is not considered that it would be automatically unfair, for instance, even in a non-closed shop situation, for an employee to be allowed to leave a trade union. This covers only his right not to be a trade unionist in general. It does not cover his right to decide not to belong to a particular union or one of a group of trade unions. We believe that an employee should not lose his job, without remedy, for refusal to belong to any union, including a particular trade union.

The noble Lord made a great point of the multi-union problem in this country. That is a problem about which, from a longish industrial experience, I know something. But to suggest that these words will necessarily push towards a more multi-union situation is, I believe, to go too far. The position in this country, where he admitted there are 17 union situations at present, is of course a lot worse than that in other countries, in spite of the fact that, until the Bill becomes law, the law has not carried this protection. I do not see that this will produce a particular pressure for employees to move from one union to another. It is certainly not the intention that it should do so. The noble Lord mentioned in the case that he quoted that this was a lawyer's point. While I have a note upon it, I do not think that I should detain the Committee by going through it in detail.

There is a constant management interest— this remark is directed to tie noble Lord, Lord Houghton of Sowerby— to avoid a complex multi-union structure. I point out to the noble Lord, Lord Houghton, that there is nothing in the provisions of the Bill and in subsection (3) which would actually prevent in an extreme situation a management and a union negotiating a closed shop agreement in relation to one union alone, provided it was the will of the vast majority of employees. So I believe that when we are accused of being blinded by intentions which we do not possess—our intention is to be fair and even-handed and to have a situation in trade union law more like that in other countries who have outpaced us competitively—I say that it is they who are blinded and that there is plenty of scope for regulated closed shops in this Bill which I trust we shall move on to in a moment, much more scope than there is in a number of other countries including those where the closed shop is totally illegal.

The noble Lord, Lord Houghton, suggested that this was an inappropriate time for change. I believe that we on this side of the Committee would take the view that certain experiences which are continuing, together with the evidence, such as we see it, of the view of public opinion as a whole, make it a very appropriate time to introduce changes to produce a situation which combines individual liberty with the continued absolute right of individuals to join independent trade unions and to bargain through them.

Lord Wedderburn of Charlton

My noble friends and I are very disappointed with the Government's response to this matter. I should like to make two points. First, it really does seem that, despite the understanding of management's interest to avoid multi-unionism, which the noble Viscount has displayed and which we understand, nevertheless in pursuit of their general policy on non-unionism, the Government have acquired a blind spot, because they believe that the protection of non-unionism to the point of promoting industrial chaos, is a policy which is defensible on the ground that it is even-handed. We do not think that that is good enough in a modern society.

Secondly, in answer to the noble Lord, Lord Campbell of Alloway, let me say that of course it is not about recognition; and I say to the noble Viscount that it is not even about closed shops, because Clause 58(1)(c) is not about closed shops and not about recognition: it is about organisation. It is about poaching, as my noble friend Lord Houghton said. It is about the poaching of and the competition for members. If the Government want to put a section on the Statute Book that will assist that, then so be it, but we shall oppose it and on that ground we shall divide on this amendment.

9.5 p.m.

On Question, Whether the said amendment (No. 14) shall be agreed to?

Their Lordships divided: Contents, 35; Not-Contents, 75.

DIVISION NO. 4
CONTENTS
Allen of Fallowfield, L.	David, B. [Teller.]
Ardwick, L.	Davies of Leek, L.
Beswick, L.	Elwyn-Jones, L.
Bishopston, L.	Gaitskell, B.
Brockway, L.	Hatch of Lusby, L.
Brooks of Tremorfa, L.	Houghton of Sowerby, L.
Cledwyn of Penrhos, L.	Howie of Troon, L.
Collison, L.	Jacques, L.

Jenkins of Putney, L.	Ponsonby of Shulbrede, L.
Llewelyn-Davies of Hastoe, B. [Teller.]	Shackleton, L.
	Stewart of Alvechurch, B.
McCarthy, L.	Stewart of Fulham, L.
Milner of Leeds, L.	Stone, L.
Oram, L.	Underhill, L.
Peart, L.	Wedderburn of Charlton, L.
Phillips, B.	Wells-Pestell, L.
Pitt of Hampstead, L.	White, B.
Plant, L.	Wynne-Jones, L.

NOT-CONTENTS
Airedale, L.	Lloyd of Kilgerran, L.
Avon, E.	Long, V.
Aylestone, L.	Lucas of Chilworth, L.
Belhaven and Stenton, L.	Lyell, L.
Beloff, L.	McFadzean, L.
Belstead, L.	Mackay of Clashfern, L.
Boyd of Merton, V.	Macleod of Borve, B.
Boyd-Carpenter, L.	Mansfield, E.
Brougham and Vaux, L.	Mersey, V.
Caldecote, V.	Mottistone, L.
Campbell of Alloway, L.	Mountevans, L.
Chelwood, L.	Murton of Lindisfarne, L.
Coleraine, L.	Orr-Ewing, L.
Cork and Orrery, E.	Rankeillour, L.
Craigavon, V.	Renton, L.
Crathorne, L.	Rochester, L.
Davidson, V.	St. Aldwyn, E.
Denham, L. [Teller]	St. Davids, V.
Digby, L.	St. John of Bletso, L.
Elliot of Harwood, B.	Saltoun, Ly.
Elton, L.	Sandys, L. [Teller.]
Fairfax of Cameron, L.	Seear, B.
Faithful, B.	Sharples, B.
Ferrers, E.	Skelmersdale, L.
Fortescue, E.	Spens, L.
Gisborough, L.	Stamp, L.
Glasgow, E.	Stodart of Leaston, L.
Glenarthur, L.	Swinton, E.
Gowrie, E.	Teynham, L.
Greenway, L.	Trenchard, V.
Gridley, L.	Trumpington, B.
Grimston of Westbury, L.	Vaizey, L.
Halsbury, E.	Wilson of Langside, L.
Home of the Hirsel, L.	Windlesham, L.
Hornsby-Smith, B.	Winterbottom, L.
Kilmany, L.	Wise, L.
Kilmarnock, L.	Young, B.
Kinnaird, L.

Resolved in the negative, and amendment disagreed to accordingly.

9.15 p.m.

Lord Wedderburn of Charlton moved Amendment No. 15:

Page 2, line 17, at end insert— ("Provided that at the time of the dismissal he was not and did not propose to become a member of a trade union which was not independent").

The noble Lord said: I rise in fear and trembling to move Amendment No. 15 in view of what the noble Lord, Lord Mottistone, said. He said that I took too long in moving the last amendment at 22 minutes, but I spoke too fast for him to understand what I was saying. I will avoid taking 44 and try to do this in 2.2

This relates to the question of unions which are not independent. In the legislation which this Bill amends there were various inhibitions upon employers edging workers into unions that are not independent. One of them was the refusal to an employer of any right by way of dismissal, or action short of dismissal, to induce an employee to have dealings with a non-independent trade union. The concept of independence being defined in Section 30 of the Trade Union and Labour Relations Act 1974 which effectively, without quoting it, comes to this: a union is not independent if it is under the domination or control of an employer, or is liable to interference by way of financial or material support or any other means whatsoever tending towards control by the employer.

What has been done in this measure is to omit the non-independent union in any specific words. This amendment would deny the rights afforded by the new Section 58(1)(c), which the Government have now pressed upon your Lordships, to someone who was intending to take part in an organisation of any kind which was not independent, be it with that employer or indeed any other.

It has been said that non-independent unions are a thing of the past. The noble Lord, Lord Campbell, said that the Bridlington principles were as dead as the dodo in the last debate. That is not only untrue but it is highly undesirable. It is also untrue to suggest that house unions, as they are known, or yellow dog unions, are a thing of the past in Britain. In the last annual report of the certification officer there were some 49 unions which had been refused certificates of independence under the 1974 and 1975 legislation. That is to say, they asked to be registered as not being under the control of an employer and they had been refused on the certification officer's investigation.

They include a remarkable list of white collar staff associations. The Commercial Bank of Australia; the Derbyshire Building Society; the Federation of Cadbury Schweppes Representatives' Association; the Playboy Staff Association— you would not expect that to be independent; the Rank Hotels Staff Association; and the staff associations of various other companies. They are nearly all staff associations. Of course, many have never even applied. The Laker Airways Cabin Attendants' Association never even applied for independent certification. Nor did Johnson Matthey's Staff Association. Not did the Dexion Staff Association. If there is to be employment— and with this Government that is a condition that one cannot promise will he fulfilled—then the white collar sector of the workforce will increase. Whatever employment there is, the white collar sector is likely to increase.

It is the continued practice of employers over that wide range of industries, of which the list could be extended considerably if one likes to look at the last certification officers' annual report, where non-independent unionism is still of some importance. Indeed, it is more important today than it was at the time when the 1975 legislation was enacted for the simple reason that in Britain now there is the first platoon of the army of employment benefit consultants, as they are called in the Southern States, who are coming across from the United States of America, where the new technologies have been organised to a very great extent without independent trade union organisation. I think I hear the noble Viscount say he does not care what happens in other countries, that he cares only what happens here. I not only care what happens in other countries, but I suggest we can at least look at other countries and see whether we can learn any lessons.

Viscount Trenchard

I was about to interrupt the noble Lord on that, but I will reply shortly.

Lord Wedderburn of Charlton

What has happened in the Southern States of America is something on which we should consult seriously in terms of how we want the workforce for the new technologies to be organised. If you do not care whether the unions are independent, then of course you do not care about the amendment. It is because we still care about the whole question of house unions and unions being truly autonomous and independent, and because we believe that industrial relations and society will best be organised on the basis of the autonomous and independent organisation of workpeople, that we have moved the amendment, at any rate to express the spirit which the Government have taken out of the previous legislation by what is now in the new Section 58 and Clause 2. I beg to move.

Lord Mottistone

I rise hastily to say that I understood that very well, and accordingly I thank the noble Lord.

Viscount Trenchard

I thank the noble Lord, Lord Wedderburn, for the briefness of his exposition of the amendment. He is too suspicious in looking for Government motives. The last time he suggested we were going to increase to a major degree multi-unionism, which I do not think followed from the words we wished to include. This time he draws the conclusion that we are trying to promote the interests of non-independent trade unions. I do not know how he squares that with the fact that Section 58(1)(c) in fact protects the individual from a threat of dismissal if he refuses to join a house union. It gives him protection against the staff associations which the noble Lord appears to dislike so much. Section 58(1)(a) and (b) give him an absolute right, whether or not a member of a staff association, to join an independent union. Again, I do not feel that the motive he suggested to us, or the effect he feels might stem from the Bill as drafted, is correct. The Government believe that membership of staff associations is a totally separate question. Individuals are protected so there can be no false pressure on them to join. But otherwise it is entirely up to the individual and it in no way cuts across his right to be a member of an independent trade union.

The only other comment I would make is that there was some muddle in the noble Lord's mind as to whether I cared about other countries. I do care about our competitors, and having at times spent a long time being responsible for the management of factories in six or seven other countries. I care very much, and I support my right honourable friend the Secretary of State in this further contribution to making our industry more competitive with those countries.

Lord Wedderburn of Charlton

That was rather disappointing and perhaps I might briefly point out why. The previous legislation dealt with non-independent unions in a comprehensive way, and this is a replacement for that. The scenario which the noble Viscount put to me would fall within Section 58(1)(c) as the Government wish it to be. I see the noble Viscount frowning; I will try to speak a little more slowly. What he says is right. The example that he gave is one where the worker is protected. But what the Government do not seem to understand is that the new wording of Section 58(I)(c) protects the man who wants to organise the non-independent trade union in a different respect, because of its very broad—the noble Viscount shakes his head. Perhaps he will take the scenario involving someone who refuses to join an independent trade union because he is out to organise a non-independent union. If he is dismissed — the noble Viscount frowns, but those who go along with the employer in organising the house union frequently get into a posture where a great number of conflicts arise.

Many complex situations can arise in which someone could be protected where his ultimate objective is to organise a non-independent union in one workplace or another one. The amendment would entirely dispose of that situation, whereas the Government's words in Section 58(I)(e) leave at risk a number of possible alternatives where that is not covered as it was in the preceding legislation. However, my noble friends and I do not propose to divide on the amendment, nor will we withdraw it, and no doubt it will be negatived.

On Question, amendment negatived.

9.26 p.m.

Lord Mottistone moved Amendment No. 16:

Page 2, line 30, at end insert— ("() When subsection (1) is being invoked in proceedings before an industrial tribunal, it shall be a defence for the employer to show—

1. (a) that it is to the advantage of the employee to be unfairly dismissed; and
2. (b) that the employer's business will suffer immediate and appreciable financial loss form such dismissal.").

The noble Lord said: On this amendment I am advised by the General Council of British Shipping. As I am sure many of your Lordships know, shipping has a problem regarding in general its workforce and in particular the operation and organisation of the members of the National Union of Seamen. I am advised that on the whole the support for the union is extremely strong throughout the Merchant Navy, but on the other hand the balloting that the union has already carried out and the balloting that the Bill will encourage it to do may well be beyond its practical resources. For example, only about 30 per cent. of the National Union of Seamen's membership voted in a ballot on this year's pay settlement—only 30 per cent.!— and therefore it seems very unlikely that there will be an 80 per cent. poll, and there would also be difficulty with regard to an 85 per cent. majority of those voting.

So as and when the union management agreement comes to an end by the process that the Bill will encourage, there will be some difficulties A particular difficulty that my amendment is designed to offset is very similar to the one which the noble Lord, Lord Oram, raised under Amendments Nos. 5 and 6. It relates to those clever chaps who might be a little greedy—I am not sure whether they are the people whom the noble Lord meant were the goats. In the event of there not being a closed shop, these clever and greedy people would be tempted, by the potentially extremely high levels of the special awards in Clause 3 of the Bill—which I understand can go up to £30,000; that was mentioned by a noble Lord earlier, on the basis of what has been said in another place—to relinquish their union membership and endeavour to secure their dismissal from their ship on that account. By comparison if they were to be made redundant, the comparative redundancy payment would be in the order of £ 2,250, which is one-tenth of the kind of sum that they might expect under the special awards.

The way in which they might engineer this situation is to take advantage of the current degree of support for the National Union of Seamen— and there is every reason to suppose this is likely to remain in existence — and of the fact that, regardless of any union instruction, other crew members in a particular ship would be likely to refuse to sail with a rating who had blatantly relinquished union membership. He might, indeed, have encouraged them to take that view. Your Lordships can imagine a situation in which a seaman is flown out to, say, Singapore to join a ship; he has recently married, or his wife has recently had a baby; his wife says, "You must come ashore, Joe", and he sees this as a way to get that extra bit of cash. So he rather ostentatiously leaves the union, he arrives out at Singapore, and the other crew members say, "We don't want that so-and-so on board".

In such a case, two things can happen. The first is that the management may be forced to sack him, and he can then claim unfair dismissal under the earlier part of Clause 2. The other factor, which applies particularly and uniquely, I think, to the seafaring merchant navy, is that there is a minimum number of crew members who have to be on board by Department of Trade regulations for a ship to be able to sail at all. So the company might well he put in the position that they have sacked this man because the rest of the crew will not have him— whether or not that situation has been engineered is another matter, but one is talking about the case where it would be— and, having done so, they then cannot sail the ship until another crew member is flown out from the United Kingdom to replace him.

It is for that reason that I put in both the subsections of my amendment: the first, as it were, to take care of the conditions under which the company might be able to present the case that the person had done it to his own advantage; and the second, which I deliberately linked with an "and", to make it peculiar to the circumstances I am talking about— namely, that if the ship was not able to sail until a relief flew out it could genuinely be said that the company was going to lose a lot of money.

So this is a particularly tailored amendment, and I particularly tailored it because there are special problems about British shipping. My amendments Nos. 154 and 155, right at the end, will take care of the other problems—I am not touching on them now— and I wanted specifically to pinpoint these amendments to deal with their particular problems. I shall be most interested to hear what my noble friend on the Front Bench has to say. I beg to move.

The Earl of Gowrie

I understand and sympathise with the anxieties which my noble friend has expressed in relation to the kind of situation that the shipping industry might, in his scenario, get into, even though I must say that I find it a rather hair-raising, too exciting and slightly far fetched scenario. But all things can happen, and one must try to take steps to protect industries as well as people from unfair practices.

The only point on which I part company with my noble friend is that I do not think this is in any way necessary because the protections already exist quite firmly. My noble friend argued that employers— and he cited the shipping industry particularly—may find themselves caught between union pressure to dismiss, on the one hand, and the cost of giving in to that pressure on the other. If employers are forced by threats or by real industrial action to dismiss an employee for non-membership of a union, then the employer will be able to join the union concerned in any unfair dismissal proceedings and, if the tribunal finds that the union has exerted pressure on the employer to dismiss, it can order the union rather than the employer to pay part of the compensation or all of the compensation award.

But supposing this was, in ordinary language, a put-up job. My noble friend argued that the employer might be at risk from the rogue employee seeking to engineer his own dismissal in order to get the money. But the law adequately protects the employer in any such case. If the employee seeks to disrupt the employer's business so as to be dismissed, the employer may be able to dismiss him fairly for that reason. In any case, tribunals would be able to reduce any awards of compensation to zero if need he if any action of an employee before dismissal should justify this. It should be only where the employer is responsible himself for unfair dismissal that he will face having to pay the whole of the compensation awarded. I think that any industrial tribunal worth its salt would quickly rumble the kind of fraud being suggested by my noble friend, and I hope that with my iteration of the existing law, that will give some comfort to my noble friend and he will be able to withdraw his amendment.

Lord McCarthy

I do not want to hold up the Committee but I should like to contribute to this. It has been a very interesting discussion and I should like to congratulate the noble Lord, Lord Mottistone, on raising an issue of which, in general, one was aware, but not in the specific terms in which he put it. I think that he put it extremely well. It is no accident that he makes his point advised, as he says, by the General Council of British Shipping, because they, with the National Union of Seamen, have the heart and guts of this problem. It is a very serious problem for them. We have some amendments down on this issue, but I am bound to say that I think that the way the noble Lord has put it is the best way to put it and the narrowest way, and it may provide the right solution.

It is true that the problem arises not because of conscientious objection or deeply-held personal convictions. I think a large part of what the noble Earl has said in reply seems to some extent to be based on that assumption. It arises entirely because of the Government's commitment to the 85 per cent ballot provision That is the point. For all kinds of reasons, it is impossible for the National Union of Seamen and the General Council of British Shipping to get to the kind of figures that the Government insist upon. If 100 per cent. of the people employed by the General Council of British Shipping wished to participate in a ballot to produce an 85 per cent majority, it could not be done—because of movement between ships, because of the number of ships outside the country and because the number of people signing off. It could not be done. Therefore, there is the problem, of the, as he puts it, "clever chap tempted by the special award which, at its maximum (the Minister said this in another place), could be £ 31,000 to the clever chap. He may say that he is greedy; but let us not use pejorative terms. A man is entitled to maximise his benefit and opportunities. It is £ 31,000 or the maximum available for redundancy. The maximum available for redundancy is, I am told, £ 4,080. None of us can put our hands on our heart and say that, offered the one, we would not choose the other.

It is £ 31,000 versus £4,000, and the clever chap decides to throw in his union card. There is no contributory thought involved. He is perfectly entitled to do it because he does not have a valid union membership agreement. It has not had the 85 per cent. ballot and, as the noble Lord, Lord Mottistone, says, it cannot have the 85 per cent. ballot because of the peculiar circumstances of the shipping industry. Therefore he is the bounty hunter— the intelligent man who wants to maximise his opportunities has this available to him.

There is no answer from the noble Earl; he says he sympathises with the shipping industry, but what is he prepared to do for it? He says he regards it as farfetched. I do not regard it as far-fetched; if anything, I think the noble Lord has outlined it almost too simply and too clearly. It is not far-fetched at all; it is most plausible. He says that we must protect industries as well as people, but what is he prepared to do to protect the General Council of the British shipping industry? He says that if they are forced by threat to discharge this person they can, as it were, go into the joinder procedure. But nobody is suggesting necessarily that the trade union is in some kind of conspiracy. In the example put forward by the noble Lord, Lord Mottistone, as he rightly said, it was the fellow members on the ship who felt like this, all of whom may have voted in the ballot but for technical reasons could not reach 85 per cent. What is the point of the joinder in that situation? It does not solve the problem; they cannot get back the cost of an interruption of supply; they cannot get back the cost of flying further people out to fill up the ship, if indeed they can find them, to sail it on time or after time by joinder.

These things will not solve their problems for them. No, but the amendment will. Again, I do not think that the noble Lord is insisting necessarily on precisely his words. Let the Government come to us and say they do not like these words. Let them bring other words. Let them try to meet us in some way. Nevertheless, the paragraph as we see it seems to be very modest and very moderate. The noble Lord is making two provisions. He is saying:

(a) that it is to the advantage of the employee to be unfairly dismissed"— in other words, it is perfectly clear to an industrial tribunal that it is £31,000 versus £4,000. The noble Lord suggests, secondly, what the employer should be able to show— and after all this is a very significant and difficult thing for him to show; it could not be shown by every employer and perhaps not very much by most employers, but it almost certainly could be shown in the circumstances the noble Lord talks about in connection with the General Council of British Shipping—

(b) that the employer's business will suffer immediate and appreciable financial loss from such dismissal.' If they cannot show that then they cannot sustain the case, but if they can show that then I would say we should support this amendment and they will be entitled to be able to invoke it.

The Earl of Gowrie

I am most grateful to my noble friend. I should like to answer just one of the points put to me by the noble Lord, Lord McCarthy, while it is fresh in the mind of the Committee because it may reassure my noble friend Lord Mottistone, and I rather suspect the noble Lord, Lord McCarthy, of trying to come between me and my noble friend. The noble Lord, Lord McCarthy, asked what I was prepared to do to help British shipping to get their ballot and the answer is that the Government are proposing to put down an amendment which will in fact ease their situation in this respect. We are seized of the point that the noble Lord, Lord McCarthy, has made and that my noble friend has made. My noble friend Lord Ferrers will be moving amendments on this to make it clear that ballots can be held over more than one day. That will help the communications problems of the shipping industry, in order to get the full and appropriate turnout. I really think that will meet most of the anxieties of the shipping case. No industrial tribunal worth its salt, it seems to me, would sustain fraud of that kind for a minute.

Lord Mottistone

I am grateful to my noble friend for saying that the ballot can be held over several days. That will be a very useful answer when we come to Amendments Nos. 154 and 155, right at the end of the whole picture. I hope that that answer will be repeated then. I was hoping that my noble friend would say that the Government are aware of the main issue, which I am now trying to explain. I am not expecting the Government to come up with an immediate answer. I hate to say it, but the noble Lord, Lord McCarthy, so well supplemented what I had to say that I hope that the Government will read very carefully what he said.

It would have been much nicer if my noble friend could have said that the Government would take this away and look at it, because it is quite a serious problem in its own right. I presented it in shipping terms. But all I am asking for and suggesting in my amendment is that it shall be a defence, which puts that in the mind of the tribunals beforehand. I am not saying that it shall be an absolute right. This is frequently used as a guideline in legislation, and I should have thought that it deserved rather more of a look from the Government. I admit that the phraseology could well be improved, but I should have liked to think that the Government could have treated me a little better on this amendment, for the reasons that I gave. I wonder whether my noble friend could be a little more forthcoming on that.

Baroness Seear

We on these Benches should like very much to support what the noble Lord, Lord Mottistone, has said. We believe that this is dealing with a very real point—I do not want to enlarge what the noble Lord, Lord McCarthy, has said— and that it meets a problem. I very much hope that the Government will take it away and think about it.

Lord Houghton of Sowerby

It is a good idea that we are talking about this rather late in the evening; otherwise, the public would get the mistaken impression that the debate has taken such a bizarre turn that we are now trying to prevent people from wanting to be unfairly dismissed. I think that members of the public will think that we have gone barmy, and that this Bill is not to protect people from unfair dismissal, but is to facilitate unfair dismissal with considerable rewards at the end of the day. Do not let us leave the mistaken impression that there is a lot of money in this for people who want it. The money in this is for people who do not want it; that is the whole purpose of the Bill. Surely the seamen's union and the maritime industry can find a way of dealing with people who want to be unfairly dismissed. What about walking the plank?

The Earl of Gowrie

Not for the first time in debates of this kind, the noble Lord, Lord Houghton of Sowerby, has come to my rescue very effectively. I think it was two years ago that I had a splendid speech, as I thought, on secondary picketing, which I did not deliver because he had just given a much better one from the opposite side of the House, think that the noble Lord, Lord Houghton, has really answered the anxieties of my noble friend. Perhaps he will take that answer in conjunction with the rather specialised amendments which we are proposing at a later stage, to try to deal with the special difficulty that he has outlined, and which particularly, but not uniquely, affects the shipping industry.

I urge the Committee to recognise that this is a measure, as the noble Lord, Lord Houghton, has said, to protect people from unfair dismissal. It would be quite wrong to whet any expectations that there is some easy money to be got in this way. Employers do not have to dismiss people, and there is no compensation if they do not take that course. I should have thought that the idea of an entire union being, as it were, party to a fraud of that kind would also be rather insulting to the union concerned. So while I will look again very carefully at what my noble friend has said, I do so without commitment, because I do not think, given the assurances that I have made, that this is a reasonable anxiety. I do not think it is an anxiety which is liable, in practice. to be fulfilled, but I will undertake to look at it and perhaps write to my noble friend on the subject.

Lord Mottistone

I thank my noble friend very much for that generous end to his reply. I would make only one further point. The noble Lord, Lord McCarthy, said that this small pocket of union members surely cannot be expected to commit the union to some undertaking which would then make the union liable. I hope that that is not the case. No doubt we shall return to that point later in the Bill, so I will not pursue it further now because it is getting late. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

The Deputy Chairman of Committees (Lord WellsPestell)

I have to inform your Lordships that, in the event of Amendment No. 17 being agreed to, I cannot call Amendment No. 18.

9.51 p.m.

Lord Wedderburn of Charlton moved Amendment No. 17: Page 3, leave out lines 4 and 5.

The noble Lord said: Perhaps that is a rather remote possibility! Nevertheless, I rise to move Amendment No. 17, because we come now to ballots. I should not say that now we come to ballots, because the very interesting amendment moved by the noble Lord, Lord Mottistone, has raised the problem of the ballot in a specific area. I would not wish to suggest that anything I say now detracts from the very special problems which he put forward and which the British Council of Shipping has sent to very many Members of both this House and another place. Nevertheless, it is a problem in relation to the ballot and the continual balloting in particular areas of employment to which this amendment is directed. The Bill as it stands adds to the hurdles which the employer, and now the union or shop steward, if they are joined, need to show in an unfair dismissal case in order to prove that the dismissal was fair. It adds to the hurdles that they need to show that there has been a ballot within the five-year period, in accordance with the many provisions of the new Section 58A. This amendment would cut out the two lines which require a ballot in every case and in every area of employment within five years.

In moving these amendments, I must make it clear once again that we on these Benches are not in any way subtracting from our opposition to the whole structure of the Bill which incorporates the balloting principle in relation to union membership arrangements and especially, of course, in relation to ballots which require totally undemocratic majorities of 80 per cent. of the electorate or 85 per cent. of those voting—which is totally indefensible on any grounds whatever. But, if we are to have such things thrust into industrial relations, at least it might be a slight improvement if we did not have to have such a ballot every five years.

I shall not try to match the problems which have been put forward so eloquently on behalf of the shipping industry with examples from other areas of industry, but noble Lords will know that there are groups who have, if not precisely parallel, at any rate analogous questions and problems in this respect. One with which I am acquainted and about which I declare an interest relates to the British Actors Equity Association, which organises actors, stage managers and other workers in the theatre. I am chairman of the London Theatre Council and the Provincial Theatre Councils and have some knowledge of the way in which management and the union have, for very many years since the time Lord Esher drafted the first standard contract for the industry, worked through union membership arrangements and security arrangements, which both sides of the industry find is the only possible basis for the acting profession, especially, to adopt. It would be particularly difficult for them to reach the sort of majorities required, or even any majority, in view of the shifting nature of a large number of members of the acting profession. Surely it is no accident that in the Industrial Relations Act 1971 the Government found at the very last moment that it was necessary to invent a new category of approved closed shops which applied to both the shipping industry and Equity, and possibly to other unions, although plainly it was adapted to the needs of those two groups of workers and employers.

Representations have been made by other bodies Fears have been addressed to the Government by the Engineering Employers' Federation, the Institute of Personnel Management, and the Industrial Society all of whom fear that in some parts of the industries of which they have knowledge, those who might adopt a parallel course to that described in the last debate, and in particular someone who did not like his redundancy pay— as my noble friend has suggested— might in all honesty, in a sense, say, "I don't want to be in the union, anyway. If I get out I shall be dismissed. If I am dismissed I can have a special award. I am not contributing to anything". If the Government think that they are going to escape from these problems by putting upon the industrial tribunals of this country the burden of finding contributory fault every time the Government's drafting is defective, then they had better think again, because there are a number of industries where this problem is going to arise.

The point of this amendment is a very much more limited one than that of the previous amendment. The previous amendment was to try to give a specific defence to a particular type of employer. All I say about that is that it may well be that when the Government consider the position of the shipping industry, they will consider that of the theatre as well. But once one has had a ballot and has a majority of 99 per cent., or whatever it is that the Government insist upon, why is it necessary—especially with a shifting workforce— to have a ballot within five years? If one has a shifting workforce, especially seamen and actors— who are sometimes paid by the voyage, or by the week or by the month— are they to be bound for five years by a ballot that has taken place the previous week? There is no particular logic in having a ballot every five years rather than every week. That would apply to mobile workforces on construction sites and so on.

What this amendment suggests is that, because of the problems rehearsed in the particular context of the last amendment, and because of the rather more general problem which that illuminates, when one looks at the need for ballots— and I have in mind the notable speech made by my noble friend Lord McCarthy on the 1980 Bill in relation to ballots, when he said that everyone was turning to ballots and that ballots were the answer to everything!— I do not believe they are the answer, and indeed it is on the record of many employers' federations that managers think that ballots are not always the answer, to industrial relations problems. Or at any rate, if they have had a ballot, they probably think it is quite a sensible idea to let them get on and negotiate with the union or with whatever association they have, even if they are house unions, and decide when to have a ballot again. That seems a much more sensible procedure; the straitjacket of every five years is likely to give rise to a very great deal of bad feeling.

I include in that the case where the workforce changes completely and wants a ballot more quickly, and then the employer says, "I do not have to hold one for another four years." It may well be that one should be held sooner. There is nothing in the legislation to stop it. If the Government do not mind when it is held, then, in our submission, it would be more sensible to leave it to negotiation. That does, of course, illustrate our preference for negotiation on the shop floor compared with statutory rules. If that is the basis of this amendment then it is a very good one. This is only another illustration where the demand for a five-year period is a straitjacket which in many cases will lead to quite unnecessary argument. I hope that the Government will think about the other industries which have particular problems in regard to a particular period being imposed upon them, and will think again in relation to these two lines in Clause 3, of which I beg to move the deletion.

Lord Renton

As I have understood the noble Lord, Lord Wedderburn, he is not complaining of the holding of ballots, but of the holding of them every five years. This is a matter of judgment to be exercised in the light of experience. I do not claim industrial experience but I do remember this, that in the best of industries the annual turnover of the workforce is at least 15 per cent.; and if we take 15 per cent. turning over each of five years it brings us very nearly to a complete turnover of the workforce in five years. In those circumstances, surely we must acknowledge that a very considerable change of attitude may have taken place. Therefore, in the judgment which we have to exercise in deciding how often ballots should be held, five years does not seem to be unreasonable. I hope that my noble friend Lord Trenchard, replying for the Government, will indeed be able to assure us that that is about right.

Lord Oram

I should like briefly to support this amendment since it relates to a point which I made during the course of the Second Reading debate. We have been reminded by my noble friend's opening speech, and indeed in the discussion on the amendment that preceded this, that the closed shop is not, as some people seem to think, an instrument that suits trade unions only; it suits many employers as well. And why is that? Well, it is because once an employer has negotiated a working arrangement with a trade union he knows where he stands. He can get on with running his business, and he can leave perhaps his personnel manager to operate what have become known and acceptable procedures. But if those procedures are to be subject to reaffirmation every five years that smooth running system, which he will have achieved in his negotiations with the trade union, will, I suggest, be replaced by a situation of constant questioning and potential disruption. A small minority of dissidents within his workforce may be constantly campaigning to get the original decision changed. I think that that cannot but create an atmosphere of doubt all the time and therefore of generally bad industrial relations, replacing a situation which may well have been a smooth and amicable state of relationships. Therefore, I believe that my noble friend's suggestion that we leave out these two lines would improve the Bill considerably.

Lord Campbell of Alloway

May I support the way in which my noble friend Lord Renton put his observations. But there is one other point I would wish to make. Surely the gravamen of the speech of the noble Lord, Lord Wedderburn, was really that there was an absence of any form of machinery to grant derogations from the closed shop where both the employer and the employed wished to operate a closed shop, and there was no reason in the national interest why it should not be operated. I mentioned this on a previous occasion and gave the example of Equity; there is also the problem of the seamen. If at some time the Government, not necessarily in this Bill, were to introduce some form of arbitral or quasi-judicial machinery so that the closed shop could be operated where it was in the national interest, or where both parties wished to operate it, then surely the substance of the noble Lord, Lord Wedderburn's observations would dissolve. Therefore, his amendment in those circumstances would have no sound basis.

Lord Howie of Troon

I rise to support this amendment in a condition of some excitement because noble Lords will notice that my name appears on the Marshalled List in addition to those of my noble friends on the Front Bench. A situation in which I and my Front Bench on this Bill achieve almost complete identity of view is sufficiently unique not to pass unremarked.

I think that my noble friends are absolutely correct. The amendment will have the effect of removing a quite unnecessary element of compulsion from the Bill. We all know that some closed shops are objectionable, but by no means all closed shops are objectionable. Some of them are desirable, and are desired by those who are involved in them, and have been so desired for a very long time and are not under question.

It seems reasonable that, where closed shops are working properly and where they are accepted by their employees who are involved in them, there should be no compulsion placed upon them to be involved in balloting every five years or at any interval of time at all. What is correct is that there should be some triggering mechanism and there are amendments later in the Bill which would produce a mechanism of that nature. However, this compulsion is not necessary. The amendment removes it and ought to be supported.

Lord Boyd-Carpenter

I feel that the oble Lord, Lord Wedderburn, has ignored a little the basis of this part of the Bill. My understanding is that it involves a compromise between those who hold the view, which I am inclined to hold, that the closed shop is an abomination and that we should proceed— as many of our friends in Europe have done— to outlaw it, and those who, like noble Lords opposite, regard it as a very important accessory to trade union power. I quoted on Second Reading the very significant revealing words which the noble Lord, Lord McCarthy, put in his book, to the effect that the closed shop was the basis of trade union power.

As I understand the spirit of the Bill, it has been to indicate that although the closed shop is in many ways an oppressive institution, nonetheless it should be accepted where the overwhelming majority of those who work in that particular industry want it— hence the high majority figure to which reference has already been made. However, as my noble friend Lord Renton pointed out, in most industries and most jobs there is a very considerable changeover in personnel over the years. That must be particularly so in the area to which the noble Lord, Lord Wedderburn, referred, of actors on the London stage.

I should like to say in parenthesis that I have always thought that, acting being an art— and a very fine and impressive art— was a peculiarly inappropriate area for a closed shop situation and that theatre managements should be free to employ people with the personal qualifications and artistic abilities that they wanted, regardless of their union membership. However, that is in parenthesis.

The point that I am seeking to make-it is the only one— is that the Bill embodies a compromise— to say that you shall have the closed shop if the overwhelming majority want it, but not otherwise. That by itself is nugatory unless there is some such provision as a five-year one, to ensure that a view once expressed is still the view of the overwhelming majority. I hope, therefore, that my noble friend will resist the amendment.

Lord Houghton of Sowerby

The first question is whether the period of five years for the review of the existing closed shop is the right period. It is, as the noble Lord opposite has said, a matter of judgment. Years ago when I was negotiating the introduction of equal pay in the Civil Service and I suggested to the then Chancellor, Rab Butler, that five years for an instalment plan was the right kind of period, he said that he thought it should be seven years, because there was a good biblical precedent for it. Probably seven is the right interval here because there is a good biblical precedent for it.

But the more important point is this. My noble friend referred to the criticisms of the Engineering Employers' Federation of the review of the existing closed shop clause. They had all sorts of worries about it. The Director-General, Dr. James MacFarlane, said in the May issue of the Federation News: We do believe the Government would do well to defer bringing in the provision for the review of the existing closed shops until after the next General Election so as to reduce the incentive for unions to make general political capital out of existing cases. I read in the June issue of the same Engineering Employers' Federation News: Equally welcome to us has been the Government indication that the balloting provision for existing closed shops will be deferred for one or two years after enactment to allow time for adjustments. Can we hear something about this? Are we to have an Act of Parliament which provides for a review of existing closed shops? The Minister is to defer the operation of this provision for one or two years. If it is two years, it will be after the next general election, Here we are, running into fresh difficulties about the authority of the House to carry on into the next Parliament. I do not suppose for a moment that the present Secretary of State will be there then. Would it not be better to have no provision for review at all than to make one and defer the operation? I prefer the deferment of the operation of the whole Bill— and I said so during the Second Reading debate— if this is how the Government could be reconciled to some change of policy at the present time. If they will go doggedly on, let them doggedly put it on the statute book and defer its operation; at least they have it in mind to do that on one of the most important clauses in the Bill.

I think that we are entitled to know a little more about the Government's intentions. They talk about adjustments. The truth of the matter is that this will have to be watched with great care in the run-up to the general election, because it will obviously be a matter of considerable political controversy. If they want to get rid of this until after the general election, they will postpone the operation until after the general election, when doubtless some other Government— whether the present one or the mixture of this and some other party —will come to power. So I hope the Minister will throw sonic more definite light on the Government's intentions.

Lord Rochester

Like the last two noble Lords, I should like to address myself to the principle involved here. At Second Reading I made it plain that as Liberals we find the whole concept of the closed shop objectionable in principle and we were, therefore, sympathetic to any practicable restriction on its operation. Indeed, speaking only for myself, I went on to say that experience in large-scale industry led me to think that statutory periodic reviews of closed shops at this juncture might prove ineffective. It was with that consideration in mind that I then suggested what the noble Lord, Lord Houghton, has just referred to; namely, that at the Committee stage it might be helpful if, instead of merely being reminded that the balloting provisions would not come into force for another one or two years, we could be assured that they would not operate until after the next general election.

The noble Lord, Lord Boyd-Carpenter, took me to task about this, so let me make it plain to him— for I see him in his place—and to the Committee, that I said what I did only because if this legislation on the closed shop is to prove effective, in my view it is essential that it should clearly command the support of such a large majority of the electorate that it proves workable in practice. However, judged by that test, even in the three weeks since our Second Reading debate the situation has moved on as a result particularly of the disruption of the railways that we are now experiencing.

From the arbitrary decisions of the rail union executives that have led to the disruption that there has been, I have to say that for my part I feel driven to the conclusion that I must now mention. This is that the time has now come to try to establish at periodic intervals—there may be room for discussion as to precisely how long—the degree of support that there is among the general body of trade unionists for the monopolistic power that has too often recently been wielded irresponsibly in closed shop situations by certain trade union executives, particularly in the public sector, without prior consultation with their members and at the expense of the community at large.

The Committee should, however, be under no illusion— here I agree with the noble Lord, Lord Wedderburn— that, when this clause of the Bill is implemented, a number of practical problems will arise. Some of them are highly relevant to the amendment we are now discussing. Unions generally may indeed engage in electioneering tactics and possibly act irresponsibly in order to attract votes. There will be rivalry between different unions. People will want to switch from one union to another, and so on. Therefore, we have to face the real prospect that in order to gain a long-term benefit, if it is a long-term benefit that people feel that we shall gain, there may in the short term be effects on industrial relations that are disturbing. It is for that reason that we shall later be moving amendments aimed at seeing that the percentage of support required in ballots affecting closed shops is set at figures which are not so high as those now in the Bill. But, having said that, because of the overriding principle that is here involved as I have sought to state it, I feel that I must oppose this amendment.

10.18 p.m.

Earl De La Warr

It seems to me that this amendment, in the way it has been moved and followed up, apparently carries with it some misunderstanding. We talk about this statutory period. The noble Lord, Lord Howie of Troon, talks about the compulsion to have a ballot. Of course there is no compulsion to have a ballot. This is not a statutory thing. It does not have to happen. We tend to look at this provision as though we were going to move into a period when there were automatically going to be ballots.

What the Bill says is that a man shall not be unfairly dismissed unless there has been a ballot. I very much hope that thinking may change so that the employers may find that they do not want to have ballots because the practice of closed shops, as we know it, tends to disappear. You may think, at least from my point of view, that this is a utopian idea, but please let us look at the question of ballots not as something which we must have but as something which is a protection for the worker. That is the point I wanted to make and I hope I have made it properly; it is not statutory but the absolute opposite.

Viscount Caldecote

It is true, as the noble Lord, Lord Houghton, said, that concern has been expressed about the periodical review of closed shops. However, the noble Lord misrepresented the views expressed by the Secretary of State when he made the conciliatory gesture that he would delay the implementation of the requirement of the review to have ballots. The point surely is that where there has been a closed shop tradition in existence for a long time in a company or industry, it will take time for the industry to readjust to the new provision which, in my view, is good. If the provision were not included in the Bill, there would be no incentive for the industry or company concerned to take action and look around to see what they should do when the new procedure comes into effect. We should not regard it as in any way ridiculous to have this provision in the Bill, but to delay its implementation so as to give time for necessary readjustment to take place in the industries or companies concerned.

It has been said quite often that many managers find the closed shop convenient in industry. It is not the job of Parliament to make life in industry convenient and cosy for managers. It is Parliament's job to strike the right balance between the rights of the individual and of the trade union and employer, and in my view the Bill as drafted strikes that balance correctly. We should not press the argument that it is a bad provision to have ballots for the review of the closed shop simply because it is inconvenient to some managements.

Viscount Trenchard

I thank my noble friends for their remarks, almost all in support of the Government's position. I say to the noble Lord, Lord Oram, that I am answering the proposition for the amendment as one who has in the past negotiated closed shops, and been keen to do so, within the British trade union position, even though I had responsibilities in countries where they were not allowed and where there was no trouble because they were not allowed. One thing is what is a sensible thing to do in the situation with which we have been living, which the Government and many people think is not a balanced one. Another thing is what industry will in fact do when the new law becomes accepted, as I believe it will, and when automatic, fairly low-key checks become a regular part of our life, a point to which I shall return.

Public opinion is fairly firmly on our side, and I make that point because I thought nobody would mention it. In fact, I have received a note telling me that the Mori poll conducted for Panorama in November 1981 showed that 79 per cent. of the general public and 77 per cent. of trade unionists agreed that there should be regular secret ballots on whether or not closed shops should continue. That is part of the answer to the noble Lord, Lord Howie, who felt the amendment was unnecessary.

Lord Howie of Troon

I did not.

Viscount Trenchard

I apologise to the noble Lord; he thought the Government's intention in this respect was unnecessary. The noble Lord, Lord Rochester, with qualifications which he later included, also felt it was necessary. The Government believe that it is very necessary. With the powers as they at present exist in union rule books, the difficulty of bringing about a ballot if you are a minority is in fact very real. We believe that the Sandwell, the Strathclyde, the Wallsall dinner ladies, and the British Rail instances and the European Court ruling all in their different ways also support the necessity for a move in this respect.

The power of trade union rule books can be used, and has been used, in ways which make a free expression of opinion after a period of time very difficult. So the Government do not believe in the principle of one man, one vote once. They believe in a low key, automatic check in a ballot. After discussion of various periods of years arising from the Green Paper the period of three years was also suggested. It might not be biblical, but nevertheless it was suggested The Secretary of State has suggested five years.

My noble friend Lord Caldecote has spoken both on Second Reading and tonight in relation to the position of the Engineering Employers' Federation, and indeed this aspect, and for instance, the problems of the shipping industry, which we talked about earlier, provide the reasons why the Secretary of State has announced—I point out to the noble Lord, Lord Houghton of Sowerby, that there is nothing new in this—that the Government are still considering whether the transitional period before the application of the ballot should be one year or two years, and they are not likely to make a decision before the Bill becomes law.

I should like for one second to return to the position of the shipping industry. The transition period, together with the amendment in the name of my noble friend Lord Ferrers, for balloting on more than one day, are meant by the Secretary of State to make possible the proper introduction of regulated closed shops in industries where there are difficulties, and to allow time through the transition period to discuss how the arrangements should be made. So for all those reasons I reject the amendment; we cannot accept it.

Lord Wedderburn of Charlton

It was not altogether surprising to hear that the Government will not accept the amendment. The Government do not seem to be willing to accept any amendment to the Bill; nevertheless we shall try. It is very heartening that my noble friend Lord Howie of Troon and I, when it comes to the crunch of looking at the Bill, really do not find that our positions are that far apart, though when it comes to his amendments I fear that there will still be a distance between us. I must say that I find the Government's position quite extraordinary, especially when it is supported by the kind of points that the noble Lord, Lord Boyd-Carpenter, made. I should like to touch on two of them. He said that the closed shop is an abomination. There is a lot of this talk. He also said that public opinion says that it is an abomination. Certainly time and again the public are told that it is an abomination, without any reasons being given.

Of course, when it comes to a legitimate clash between minority interests and majority interests—and that is what union membership arrangements are about—then those who can afford to stand by and not be concerned usually take the position of the minority. But that does not mean there will be low key ballots, as the noble Viscount seems to think, because workers on one side and the other feel very strongly on these matters.

With regard to the second point made by the noble Lord, Lord Boyd-Carpenter, he said, "It is an abomination, let's abolish it, as have our friends in Europe". It really is time—

Lord Boyd-Carpenter

Will the noble Lord not misrepresent me? I said specifically that what the Government were proposing with the ballot was a compromise which I supported.

Lord Wedderburn of Charlton

I take the noble Lord's point. He wants the present Bill, but he is happy to travel along the road this distance at least towards the goal of which he approves—that our friends in Europe have made the closed shop illegitimate because it is an abomination. Perhaps that puts it better, and I am grateful to the noble Lord. But if he makes that point, then I am afraid that it is made in error. It really is time that people realised that the union securityarrangement—though, of course, it does not take the same form in every country—is not completely outlawed in every country in Europe. Even in countries like France and Germany, where the law is against it. I remember Professor Sir Otto Kahn-Freund, when he was alive the greatest expert on labour law in the world, saying a few years ago, Try going down a coalmine in the Ruhr without a union card!"

Of course it happens as a practice in many countries, but it goes beyond that. In Holland, in Sweden and in Denmark, and to an uncertain extent in Belgium the law does not totally outlaw closed shop arrangements. Indeed, in the first three clearly it does not. So there is a wide variety of union security arrangements throughout the world. My honourable friend in another place who spoke on this Bill spoke fresh from a visit to Japan, where he visited a factory and asked, "Why do you do so well"? and they said, "We have a closed shop". It is in Hansard, and if noble Lords want the reference I will bring it to our next debate.

So it is not something which is peculiar to Britain or the form of which is peculiar to Britain; and it does not help simply to call an abomination something which is an attempt to get an orderly arrangement of industrial relations and for 95 per cent. of the time to provide for small minority interests—because that is what most closed shops do. If you want to look for that, you can look at it in the forbidden fruits of Gennard. My noble friends and I have been discussing this problem, and we think we should make the offer that if noble Ministers refrain from wearying your Lordships with four dinner ladies in Walsall and Sandwell District Council and three railwaymen in Strasbourg, we might consider not referring to the Gennard Report any more.

But much the most serious point, if I may say so with great respect, was, it seemed to me, the point made by my noble friend Lord Houghton, although I intersperse a comment on the noble Lord, Lord Spens, in respect of the matter which he touched on. that after all this is about dismissal and therefore the five-year ballot is a limit put by statute, but of course you could vary the ballots in between that. But the point also has to be taken that when we come to Clause 9—and I appreciate we are not debating it with this clause—the same sort of limits apply in respect of management action short of dismissal.

Therefore, the managements which have been making representations to the Government have this well in mind I put it in this way in one sentence, that when the Engineering Employers' Federation made its representations to the Government, as indeed many other employers' associations have, not liking this particular part of the arrangement, they of course had in mind that they were not just at risk in the tribunals for actions for dismissal, but also, under the new arrangements, actions in respect of matters short of dismissal which are unlawful in a similar way and liable to compensation in the tribunals on the part of someone who is in this posiiton of a non-unionist without a ballot.

But much the most serious point, as I say, was that made by my noble friend Lord Houghton, because I refrained from mentioning in opening on this amendment the Government's curious stance, that they insist on putting this on the statute book but appear to be willing to defer it for two years. They have not got the courage of their convictions, because they know that if they enact this there will be trouble, it will be seen to be silly and they do not want that before the next election. They do not want to enact it after two years; they want the virtue of having the courage to enact it without anybody realising that they have lacked the courage to operate it.

That is the truth of the matter as the record stands now. If that is wrong, then when we meet again the Government can tell us exactly when they are going to bring in this provision on ballots, because they know that many employers' associations are very fearful, not of low-key ballots, but of the few places, no doubt, of very high feeling. We shall not withdraw this amendment. It is notable that, if I may say so, it has had considerable support throughout the Committee, and that is support on which your Lordships may wish to reflect when we come to subsequent amendments on not dissimilar matters.

Viscount Trenchard

With the permission of your Lordships, may I make just one point clear? When I mentioned "low-key automatic ballots", I was referring mentally to the fact that the closed-shop continuation can be authorised by 85 per cent. of those voting. In that sense, there is no worry and no trouble. A fairly small vote would provide a low-key automatic check, which the union I am sure would organise.

On Question, amendment negatived.

Lord Denham

I think your Lordships would probably agree that this is a suitable moment to adjourn the proceedings for the night. I beg to move that the House be now resumed.

Moved accordingly, and, on Question, Motion agreed to.

House resumed.