Employment Bill

HL Deb 15 June 1982 vol 431 cc543-625

4.7 p.m.

Second Reading debate resumed.

Lord Rochester

My Lords, it may be for the convenience of the House if we now return to the discussion on the Employment Bill. From these Benches, I should like first to join in thanking the noble Lord, Lord Cockfield, if not for the temper of his speech, at least for the clear way in which he explained to us the provisions of this Bill. Speaking on behalf of my noble friends on the 1980 Employment Bill, I expressed the hope that, once certain identified abuses had been remedied, there would be no need for further legislation until there had been a period for digestion in which the Bill could be given a chance to work. That was said in the belief that if our industrial relations law is to be effective it must command the widest possible support, including particularly that of the general body of trade unionists, and also because in our view legislation of this kind does nothing positively to improve human relations in industry. I see no reason to depart from that basic position.

Since then, however, further abuses of the 1980 Act have been identified, notably in the actions of certain local authorities in dismissing unfairly established employees and in bringing pressure to bear on contractors by excluding from lists of tenderers any not operating a closed shop. It seems to us reasonable, therefore, that in this Bill the Government should seek to limit such abuses by increasing the amounts of compensation payable to employees dismissed unfairly, by enabling complainants to join trade unions in dismissal proceedings, by making void any term in a commercial contract requiring employment of union labour only, and by removing legal immunity from those who put pressure on an employer to use only such labour. On all these points the Government have our support.

I am in some difficulty concerning the main amendment proposed to Section 58 of the 1978 Employment Protection Act: namely, that it should be unfair to dismiss an employee for not being a union member in a closed shop which took effect before 15th August 1980 and had not, in the five years preceding the dismissal, been supported in a ballot by 80 per cent. of the employees covered or by 85 per cent. of those voting. As Liberals, we find the whole concept of the closed shop repugnant in principle and are therefore sympathetically disposed towards any restrictions on its operation. It follows that the only question that could possibly trouble us is whether the proposed legislation will prove workable if implemented now.

Speaking at this point only for myself, experience in large-scale industry leads me to doubt whether statutory periodic reviews of closed shops will at this juncture prove effective, and particularly whether in their proposals the Government have drawn a sufficient distinction between the freedom of individuals to decide for themselves whether they wish to remain members of a particular trade union as opposed to any union. However that may be, my noble friends and I are agreed that the percentage of support required under Clause 2 of the Bill in ballots affecting existing closed shops is set at figures which are too high. We feel also that the amounts of compensation, and particularly the special awards that will be available in cases of unfair dismissal, are excessive. We shall therefore initiate or support, in company, if they see fit, with our Social Democratic allies, amendments designed to make the Bill more balanced in these respects.

Perhaps I might add that it would go some way towards resolving my personal reservations about these closed shop reviews if, when the noble Earl, Lord Ferrers, comes to reply, or at an appropriate stage in Committee, instead of being reminded that the balloting provisions will come into force one or two years after the enactment of the Bill, we could be assured that they will not be implemented before the next general election.

That would not affect the Secretary of State's entitlement to pay compensation without delay to certain people dismissed from employment between 1974 and 1980 for not being members of a trade union where there was a union membership agreement. This is another part of the Bill which we support in principle, although at first sight we do not see why the Secretary of State himself is taking such wide discretionary powers to determine the amounts of compensation payable to the people concerned.

There arc two other major elements in the Bill, neither of which received much examination in another place. One is Clause 8, which gives an employer the power to dismiss without being liable for unfair dismissal those of his employees taking part in a strike who do not return to work within a specified period of notice of dismissal having been sent to all employees on strike. Effectively this would enable employers to dismiss strikers selectively and thus facilitate what trade unionists have long regarded as victimisation. I do not wish to take up a rigid position on this point now, but we shall need to be satisfied as to why the Government consider it desirable to introduce now what will certainly he regarded by the unions as a highly provocative change in the law.

Of the remaining clauses in the Bill, the most contentious are of course those concerned with trade union immunities and the liability of trade unions for damages in actions in tort and the definition of a trade dispute for this purpose. I have a kind of filial link with these immunities for, as the noble Lord, Lord Cockfield, reminded us, it was a Liberal Government which established them in 1906. It was in that year that my father became a Member of Parliament, and his must have been one of the votes which brought them into being. I cannot believe, however, that he or his colleagues would have condoned for a moment the flying pickets and other horrors which these immunities have brought in their train in recent years.

In principle, I do not quarrel with the Government's desire to amend the definition of a trade dispute by limiting it to disputes between employees and their own employer, by excluding disputes between employees themselves and by stipulating that in future protected disputes should relate wholly or mainly to the matters listed in Section 29 of the 1974 Act, rather than that they should simply be connected with such matters, as at present.

The question that troubles my noble friends and I is whether such further limitations will prove workable in practice, and particularly whether the legislation proposed takes sufficient account of trade union structures as they actually exist and of how far union officials in reality possess, and are capable of using, the powers that they are assumed in the Bill to have. More specifically, we consider that the limits on damage which may be awarded against trade unions in any proceedings in tort are set in Clause 14 at levels which are excessively high. In this case also, therefore, we shall initiate or support amendments to the Bill which are designed to make it more balanced.

So much for the content of the legislation that is proposed. What most concerns the Liberal Party is that the Bill will do nothing positively to improve industrial relations. That is an omission we would very much like to help to make good. At the Report stage in another place a number of amendments were tabled but could not be moved. Among other things, they were directed towards extending secret ballots in trade unions, obliging union members to contract into rather than out of the political levy, making certain provisions for the establishment and observance of negotiating procedures and for the extension of employee participation.

I am personally doubtful whether in the case of a number of these proposed changes there would be better industrial relations if they were now made legally enforceable. In the matter of employee involvement, however, I do believe that in this House we could together do something positively to improve the Bill. When at Question Time last Thursday I asked the Government whether they were prepared to consider suggestions as to how, through appropriate legislation, more share ownership schemes could be encouraged, it was in fact this Bill that I was thinking of. What we have in mind is an amendment to the Bill which would simply require companies employing more than a certain number of people to include in their annual report a statement describing what they had done during the previous year to develop employee participation in a number of ways.

Generally speaking, this might include the systematic provision by management to their employees of information relevant to their work, regular consultation with employees or their representatives so that their views could be taken into account before decisions affecting them were made, the involvement of employees in the performance of their company through means such as share ownership schemes and the promotion of a joint understanding by management and their employees of the relationship between pay, productivity, investment, prices and employment. am not fussy about the precise wording and indeed, as discussion of the Bill proceeds, it may be that we can work it out together.

We on these Benches have for years wished to go a good deal further in that direction, and might indeed still seek to do so, but in this instance all we are contemplating, in keeping with what is already the practice in many of this country's best companies and in the face of mounting pressure from the European Community to do more, is to oblige British firms generally at least to state what steps they are actually taking to improve this country's productivity and competitiveness by these essential means. I very much hope that, when the time comes, there will be support from all parts of the House for an amendment to the Bill on these lines. That would at least ensure that, where so many of its provisions, whether they are deemed desirable or not, are necessarily negative and controversial, there is among them at least one that is constructive and is acceptable to us all.

4.20 p.m.

Lord Boyd-Carpenter

My Lords, I should like to begin with two personal observations. First, I should like to offer, very respectfully, to my noble friend Lord Ferrers, who is not with us at the moment, the congratulations that I think most of us would want to express on his appointment to the Privy Council, which all of us regard as exceedingly well earned by his services to the Government and to this House. Secondly, I should like to say, with some timidity, how delighted I am, speaking from these Benches, to have seen the announcement at the same time that a very distinguished trade union statesman, in the person of Mr. Gormley, will be joining this House. I only regret that he is not here already to take part in this debate, to which 1 am certain he would make a characteristically vigorous contribution.

The noble Lord, Lord McCarthy, devoted a considerable part of his speech to demonstrating, with great force and clarity—and, I think, to his own complete satisfaction—that this Bill is in accordance with the general economic and industrial policy of Her Majesty's Government. I can only say on that that I hope it is, because it would be a singularly inept display of government to legislate on a matter of this importance in a way which was inconsistent with the Government's general policy.

I apologise to the noble Lord, Lord Rochester, if I did not pick up correctly what I understood him to say. I know that he will correct me if I have misunderstood him, but I understood him to suggest that the compensation to individuals which is payable under Clause 1 of the Bill should, for some reason, be deferred until after the next General Election. Does the noble Lord desire to rise?

Lord Rochester

No, my Lords. I was at pains to say the opposite, that in the case of Clause 1 we on these Benches were happy that that clause should take immediate effect. What I had to say in regard to deferment until after the General Election related to Clause 2 of the Bill and the application of secret ballots, more particularly in the case of existing closed shops.

Lord Boyd-Carpenter

My Lords, I am very much obliged to the noble Lord. I could not believe that a humane person, such as the noble Lord is known to be, would have wished to defer the payments to be made under Clause 1 to people whom most of us in this House regard as seriously wronged. That does not mean that I go with the noble Lord in the argument, which he has now explained he was making, that one should defer the ballot arrangements in Clause 2. I think the noble Lord will agree that this is an enormously important matter and, surely, in matters of this importance, affecting, as they do, the lives of very many individuals, it would be a great pity to defer any longer than administrative factors make necessary the bringing into force of these salutary provisions. What is more, it would then leave the whole subject a matter of controversy to be argued on election platforms and perhaps deferred for quite a time. So I am afraid that, although the humanitarian considerations do not apply to the same degree—though they apply to some degree—to the suggestion about Clause 2 as they do to Clause 1, I must, none the less, differ from the noble Lord on that.

This Bill is basically about the power which the trade union movement exercises in our economy over our national affairs, and also—and at least as importantly and significantly—over individuals. It is for that reason that it is an enormously important Bill. It is understandable—and I think we should be surprised if it were otherwise—that the trade union movement and those who are, in a sense, its retainers should oppose this Bill, because when enacted it will reduce in some measure, though, perhaps, in the view of some of us, not in sufficient measure, the power of the unions. One fully understands the position of the official Opposition on this, in as much as the Labour Party, as we know it, is the child and creature of the trade union movement.

But, conscious as I am that I am to be followed by the noble Lord, Lord Aylestone, I am going to express my surprise that the semi-detached party, or whatever "SDP" stands for, should in another place, with one honourable exception, have abstained on the Third Reading of this Bill. I can understand and sympathise with those in the official Opposition who are against the Bill for the plain reason that they believe in the growth of trade union power. I can understand those on the Liberal Benches and on this side of the House, who feel and judge that our national economy will be strengthened if the trade union predominance is a little weakened. But how any body of men who claim to be taken seriously in English politics, and who, I think, claim to be wishing to change the mould of English politics, can, when faced with the straight question, Aye or No, on this Bill, abstain, I find it very difficult to see. Faced with this question—and I put it lightheartedly—they ran like rabbits and all we could see was a collection of white tails.

The question of trade union power is what lies behind this Bill, and the first question on which I should like to comment is the position of the immunity from suit. My noble friend Lord Cockfield gave us historically as did the noble Lord, Lord Rochester, the background. This was introduced, understandably, in 1906 after the Taff Vale case, when the unions were small, poor and weak and might well have been put out of business by powerful and wealthy employers exercising pressure through the courts One can understand that. But that is not the position today and I suggest to your Lordships, and to the noble Lord, Lord Wedderburn, when he comes to reply, that to give one organisation or section of society immunity from being sued when they are alleged to have damaged another citizen is a very remarkable situation, and one which I do not think one puts too high when one suggests that the onus of proof is on those who would justify it.

As my noble friend said, trade unions have greater immunities than the Crown. They have greater immunities, so far as I know, than any section of our society. Is it seriously to be argued, when these bodies are wealthy, powerful and influential, that they should be free to hurt other citizens and that those citizens who have been hurt by them should be denied recourse to the courts, because of this peculiar degree of privilege?

This Bill, very modestly and moderately, nibbles at trade union immunity. Frankly, I wish my noble friend a good appetite in his nibbling as the Bill continues. But I think that in this House we are right to consider the whole principle as to whether there should be such immunity, because—and I apologise for the obviousness of this—to give immunity to one section or set of people in our country from being brought before the courts is to diminish the rights of others. It is difficult, in logic, to say, if a trade union does something which damages somebody, and which, if any of your Lordships did it, would expose you to action in the courts, that simply because it is a trade union pursuing a trade dispute it should be immune. It is a little difficult to justify this. I hope that those who speak here for the trade unions will appreciate it and will also appreciate—I do not put it any higher than this that it seems to some of us that the justification for retaining any immunity from suit rests on them.

It has always been the experience that over-powerful bodies, as the trade unions now are, girded with legal privilege, have had their day and that then, historically, somebody else has taken their place. The Crown had such powers, and they passed. Your Lordships' House had those powers, including all sorts of agreeable privileges. If, for instance, any of your Lordships were to be hanged, we were entitled to be hanged with a silken cord. We had other privileges which perhaps were more likely to appeal to a larger number of us. Those have gone. So has the overwhelming power in the late nineteenth century of the professional middle classes. I say to those who speak for the trade unions —and I speak as one who regards the trade unions as having always a permanent role of very great importance in our society—that they should be very alert in considering whether pressing for excessive power, backed by legal privileges, may not in the long run produce a reaction against them which they—and, for that matter, I—would regret.

I pass quickly to one or two of the other points which arise on the Bill. I am delighted that the closed shop issue is being tackled. There is no doubt at all that the imposition of the closed shop can, and does, inflict hardship. We know of some of the cases of hardship to individuals. We shall know perhaps how many individuals have been so affected when Clause 1 is in operation and claims are invited. The principle of the closed shop is very difficult to sustain. Why should somebody, as a condition of earning his living in a particular trade, be compelled to join a body which he does not wish to join? I know the free rider argument, but the weakness of that argument is that if unions were really conferring great benefits on their members there would be no difficulty in their recruiting them voluntarily. Indeed, there is nothing, so far as I know, except the obvious economic consequences, to prevent a union from negotiating terms applicable to its own members only. But I know nowhere a justification for compelling people to join a union, any more than there is a justification for compelling them to join a particular political party or a particular club. Therefore, I very much welcome the quite substantial improvement in the law in respect of the closed shop.

Of course the closed shop plays its part very greatly in the politics of this matter. Let me read some words to your Lordships: The closed shop is an important and sometimes essential device which adds considerably to the power of the unions to coerce and restrict the freedom of action of both employers and employees ". Those words will be familiar to the noble Lord, Lord McCarthy, because he wrote them. Like everything else which the noble Lord writes, they are clear and to the point. The closed shop is a powerful foundation of union power, both over its own members and over employers. In those circumstances, its operation—

Lord McCarthy

My Lords, I do not know whether the noble Lord has the book there. If he has, he will find that it goes on to say that over a very wide area it is an essential element in trade unions achieving any collective bargaining influence at all.

Lord Boyd-Carpenter

My Lords, I am most grateful to the noble Lord for that addition, which seems to me to be wholly consistent with the passage which I quoted. If the noble Lord would like, as it were, a Second Reading of his book in toto, I should be happy to oblige. What he has said does not in any way qualify those, as I think he realises from his intervention, somewhat damaging inferences which can be drawn from the particular passage that I quoted. This seems to be a sensible proposal, and it is one of the major aspects of the Bill.

I want to ask one or two questions of my noble friend. The Times reported the other day that the Council of Civil Service Unions had circularised civil servants to the effect that if this Bill had been law last year the selective withdrawals of labour which the civil service unions arranged Last year would have been unlawful. I do not know their authority for this. I can only say I very much hope it is true, because I regarded that action last year as most deplorable. If the Bill would inhibit it, so much the better for this Bill.

That leads me to the wider question of industrial action in the public service. What shook a great many people about last year's activities was that many of the civil servants concerned were officials with power given by Parliament over the citizen; Inland Revenue, Customs and Excise, immigration, planners—people exercising considerable powers over the citizen. For people in that position so to push their own interests, so to prefer their own interests as to withdraw their labour, and to withdraw it in a way carefully planned to do the maximum possible damage, must have had a very serious effect upon public confidence in the whole system of Government.

There is a case, though this Bill is not perhaps the vehicle for it, for providing that public servants in positions of responsibility, particularly those with powers over the citizen, should contract out of any possibility of industrial action in return for the very considerable benefits they receive. They have great security; they have an employer who hopefully can never go bust; they have an indexed pension at the end of the day. Those are very solid advantages for which it would not be unreasonable to suggest that they owe in return a duty to their employer to continue at work, whatever their view of the particular wage settlements which may be arrived at.

There is nothing new in this. Years back, a condition of service for certain workers in key industries—I think I recall it in the electricity industry—was that they should not indulge in industrial action. My noble friend reminds me that this was true in the gas industry. The same principle applies in the more responsible part of the civil service. If not in this Bill, I hope that in some future legislation my noble friends will look very carefully at this aspect of the matter.

Lord Houghton of Sowerby

Will the noble Lord permit me to say a word?

Lord Boyd-Carpenter

With the greatest of pleasure.

Lord Houghton of Sowerby

I am following what the noble Lord is saying with the closest interest, but he has not mentioned that in view of the special position of the Civil Service provision was made in the general arrangements for compulsory arbitration. On the occasion last year of the dispute which arose, access to an arbitration tribunal was refused, in breach of the arbitration agreement.

Lord Boyd-Carpenter

My Lords, I am well aware of that position. The noble Lord's knowledge of the civil service unions is unequalled in the House. He turned the Inland Revenue Staff Association into a most formidable body. But that, with respect, does not alter the general point which I was making: that it should be (I did not say that it was) a condition of their service that they should not take industrial action. What arrangements should then in the future be made in respect of the methods of fixing their remuneration would follow on from that. As there was no ban at that time upon their taking strike action, there was therefore no question of any obligation being violated in respect of the fact that the Government of the day—rightly, in my view, in the then economic situation—did not feel disposed to resort to arbitration. It would be a totally different situation if the position were as I was suggesting it would be.

I want to ask another question of my noble friend. It is apparently the case, in connection with the current dispute in the health service that members of other unions are taking part in the picketing. I was under the impression that, at least under the 1980 Act, such action was unlawful. Will my noble friend confirm that? if he does confirm that, will he give some indication to the House as to whether it is now intended to enforce the law? Here I go along wholly with the noble Lord, Lord McCarthy; it is really useless to legislate on these matters unless, when one has legislated, one is prepared to enforce the law. If there is a very clear and significant breach of the law, as there appears to have been from the press reports, then the law should he enforced.

There are many other things I wish to say, but there are also many others who wish to address your Lordships. I will only say this:.it is characteristic of the courage and determination of this Government—reflecting as it does the courage and determination of the Government's leader—that in the fourth year of a Parliament we should be coming forward for the second time with a Bill on this admittedly controversial and difficult subject, because the Government believe that it is exceedingly important to this nation's welfare that the powers of the unions should be in some measure curbed. A weaker Government would have run away from this. A weaker Government would have said, "We will put it in our election manifesto but we will do it in the next Parliament". The respect which I have always felt for this Government and their leader is very much strengthened by the fact that this Bill is being brought forward. I believe that when it is enacted it will play its part in reducing a little the harm which excessive trade union power is doing in this country. One knows that wages have been pushed up, profits squeezed and investment therefore hindered and reduced; one knows that in many cases managers cannot manage; and one knows that there is overmanning—one needs only mention British Steel, British Rail—if the noble Lord, Lord McCarthy will forgive the reference—British Airways and perhaps above all, the docks. It is over-manning which continues solely because the unions have indicated that they would lose all their power to make trouble if a reduction in excessive manning is effected.

To a Government, devoted as this Government are, to getting the British economy working efficiently again, so that employment will rise and real standards of living will rise too as a result of that prosperity, it is necessary to proceed with legislation of this kind. For my part, I would like to have seen it go further. I would like to have seen it made stronger, but I feel that it will make a real contribution to the future wellbeing of this country. I welcome the Bill and support it.

4.44 p.m.

Lord Aylestone

My Lords, speaking personally, I am most grateful to the noble Lord the Minister for the clarification he gave when introducing this Bill. Over the past few weeks I have been trying, with the Bill before me and by reference to four of five other Bills, clearly to understand it. I can assure the noble Lord, Lord Cockfield, that, having listened to him today, some of the points at least are much clearer, but we shall need clarification of more of them as we move through the Bill.

Despite the trouble and the noise that has been made by the trade union movement about this particular Bill, it is in fact a very limited Bill dealing mainly with the closed shop—which I think should be more accurately described as "union management agreements"; agreements which suggest that there are agreements between both sides. I believe that in fact that is the position with closed shops. Whether both sides really want it, or whether one side is coerced into accepting it is a very different matter.

Another very important part of the Bill deals with the condition for "trade union members only", which is a condition in the terms of some contracts applications usually of local authorities. This simply implies that unless one employs only trade union labour, then there is not much point in applying for a contract. That, too, is something that we find difficult to accept. On the third point, concerning trade union immunities, one needs to spell these out in detail if one is to say whether or not one could accept them. I accept the general principle that, no more than anyone else or any other organisation, the trade unions should be above the law.

On the Second Reading of this Bill we may take a general look at the trade union movement. I intend to make neither a major speech nor a very long one, but the general public—and this is certainly true of many of my own colleagues, if not all of them—are concerned about possible abuses which arise out of the general position of trade unions today. The SDP—which is not formed of ex-Labour Party members only, because in fact the majority have never belonged to any political party, while I suppose a minority of them have belonged to the Conservative Party—has made it very clear from its formation that we believe certain trade union reforms are necessary. I will spell them out as we go through.

We believe in what the Tolpuddle Martyrs fought and suffered for very much more than 100 years ago: the basic right of workers within an industry or profession to combine together with the right to negotiate with their employers on wages and conditions of employment. We accept, secondly, the right of individuals to withdraw their labour, either individually or collectively, if they are dissatisfied with their employment and as a protest against their terms of employment. If one accepts these two basic rights, as we do, then one must accept that they apply equally to the British Medical Association, to the Police Federation, and even to the smallest craft trade union.

These basic principles are rights which should be accepted, in our view, by all democratic countries. I say "democratic countries" because in Communist countries, trade unions have a very different function. We have no desire, as a political party, to alter what I have described as the basic principles of trade unionism, but we feel that certain trade union reforms are necessary, to end malpractices that seem to have increased over the years and which the general public and also many loyal trade unionists regard as abuses.

Trade unions are not above the law of the land, but they sometimes seem to regard themselves as such. They should not exceptionally expect any immunity from the laws of the country which are not enjoyed by anyone else. I believe that the noble Lord the Minister himself mentioned the Crown; such immunities are not enjoyed by the Crown and certainly not by the Government, and we would agree with that. We feel it is right that trade unions should engage themselves in strikes, if they arc in furtherance of what 1 have described as the basic principles and are carried out within the law. Beyond that, the use of industrial action—but let us call them what they are, "strikes"—for purely political purposes, cannot be right.

I remember a very respected leader of the Labour Party, now, unhappily, no longer with us, who gave his name to a Left-wing section of the Labour Party, and he once said that he would not accept industrial action for political ends. He said that a few years ago, and it is absolutely true today. I am afraid that many instances of industrial action are directed towards political ends. In strikes that political muscle must be applied in the right direction, the basic rights of the union. Nevertheless, I am sure that the extreme political Left will threaten, they will advocate industrial strike action for political reasons, maybe even revolutionary reasons on occasion. But in this country the ballot box should be the answer to any political difference or differences that we may have between us. I very much doubt if those six agricultural labourers at Tolpuddle ever envisaged some of the activities which we see today, or would ever have dreamt in their wildest dreams of a position where "strike first and negotiate afterwards" is advocated, or the sit-in in factories where workers have been unable to obtain an agreement for their ends and purposes.

There is nothing anti-trade union in the suggestion that the trade unions should accept the law. It may be that a later Bill will introduce what we have rightly called inner democracy in the unions, to enable the individual trade unionist to have more responsibility, to have more say in the working of his union, in the election of officers and executive committees, and in the acceptance or rejection of wage scales and offers which are put to them within their negotiations. We would have no desire, and I am sure no party would, to write the rule books for the trade union members, but it is necessary, we think, for the unions themselves to introduce a little more democracy into some of the rule books. This in fact would help the responsible trade union leader. We are sure that the idea very often we sec it on television of the show of hands at a factory gate is not always the accurate view of the individual trade unionists themselves, and in fact occasionally suggests intimidation.

The Bill in front of us will, I know, in no way prevent the activities of troublemakers; they will continue to exist—the "Rent-a-Strike" sort of activity which we have been acquainted with. But it does give some additional protection to those workers who, for one reason or another, have no desire to be members of a trade union in a closed shop situation. Most people would regard it as unfair, unjust, undemocratic to dismiss a man from a job, even in a closed shop situation, because he, or maybe she, has scruples and refuses compulsory membership of a union. It is not right, and the European Court on Human Rights agreed that it was not right, and it was rather a nasty decision for this House and this country to have to accept when the ruling was made in the European Court. We think it is fair and right to compensate a worker who, in a closed shop situation, has been dismissed for being a non-unionist. But we feel, too, that the compensation terms could be too high; they ought not to be so high as to form an added reason for non-membership of a union, and they could well do that. One cannot get away from the fact that in the closed shop situation membership of a union—maybe sometimes a particular union—becomes the only way of getting a job at all.

The second issue I have mentioned is the trade union membership only restriction being placed on certain contracts. These contracts, let in the main by local authorities, some in the construction industry or indeed in other work or services, surely should be awarded on merit, on price and quality of work and on efficiency, and not on whether or not the contractor employs only trade union labour. Such a practice must be wrong; it sounds a little like blackmail. One hears the argument that unless trade union labour is insisted upon it could lead to other sub-contracting, in some cases to individuals. This the noble Lord on the Front Bench will recognise as the "lump". The accusation is that the individual sub-contractor, who is in a sense self-employed, will avoid PAYE and will avoid paying national insurance. If this is so, and it probably is in many cases, surely it should present no great difficulty to the Inland Revenue in putting pressure on the main contractor with a view to catching the so-called "cowboys" who engage in this activity.

My Lords, we on this Bench do not feel that this Bill in any way prevents trade unions from carrying out their legitimate functions. We do not regard the Bill as "union bashing", and certainly not worthy of the misrepresentation and criticism heaped upon it by the trade union movement. While it brings us nearer into line with some other European democratic countries to whom the closed shop situation is unknown, yet it does not make the closed shop itself illegal; it protects the victims of it, and that is why we welcome it. In the main we will support the Bill, and in the subsequent stages will consider amendments on their merits.

No doubt the official Opposition will promise at the end of the debate on Third Reading to rescind the Bill in the unlikely situation that they are ever returned as the next Government. Equally, the present Government will insist that if the present Opposition became the Government they will replace the Bill when they next become the Government. So it goes on; it is an absolute case of what is known as adversary politics, which is no good for the country, no good for industry or for the trade unions themselves. To promise to rescind, and then for the other party to promise to restore, is bad for the trade unions, and I am sure it is no good for the country at all.

4.57 p.m.

Lord Underhill

My Lords, I have no hesitation in saying when the Bill reaches the statute book it will provide the most comprehensive and most effective statutory protection for non-union employees that we have ever had in this country ". That was the statement by the Secretary of State on Second Reading in the other place on 8th February (Col. 742), and that about sums up the purpose of this Bill. What are the reasons for the Bill? Certainly it will do nothing whatever to help industrial relations. Indeed, while I shall read the remarks of the noble Lord, Lord Cockfield, very carefully in Hansard tomorrow, I do not believe that in the course of his opening address he claimed that it would. Neither will it produce new jobs or reduce unemployment. It certainly cannot be aimed at the days lost through industrial action, because, as the Shadow Minister, Mr. Eric Varley, said in the other place, during 1981 working days lost through sickness were 341.5 million, working days lost in 1981 through unemployment were 790.3 million, working days lost through strikes, albeit, I agree, too many, 4.2 million. Therefore, we cannot make that a justification for this Bill.

Government spokesmen have referred to Britain being the only country that puts unions "above the law", and have also said that unions act unlawfully. But unions act in accordance with the statutes laid down by our Parliament. The Government's Green Paper on trade union immunities has a chapter on An Alternative System of Positive Rights, and that chapter, points out that Britain has its system of immunities instead of having positive rights, as do many other countries. Paragraph 145 of the Green Paper says: In short, the introduction of positive rights into the law relating to strikes and industrial action in Great Britain would be an entirely novel step. It would represent a fundamental change from the legal system on immunities which has developed over the last 100 years ". Despite what the noble Lord, Lord Cockfield, said, in my view the proposals on immunities take back the position 76 years to the 1906 Act, as was laid down by the House of Lords' judgment in Taff Vale in 1901. Of course we want to avoid strikes wherever possible. Of course we want to have improved industrial relations. I wish that we could spend the seven hours—or whatever it will be—discussing this Bill on dealing with how to improve industrial relations; but we have to deal with the actual terms of the Bill.

Nor do I take the view that every strike must necessarily be right. But history shows that threats of financial hardship, victimisation, blacklisting, even threats of imprisonment, will not deter men and women who believe they have a genuine grievance. As has already been pointed out, the Bill restricts the definition of a trade dispute. Some disputes will be made unlawful even though the circumstances are such that the workers may consider industrial action imperative and as being the only way to deal with what they regard as a genuine grievance.

I do not know whether the noble Lord, Lord Boyd-Carpenter, proposes to put forward suggested amendments to the Bill. But I hope that noble Lords will take very careful note of what he said about the Civil Service. For myself—and I do not speak for anyone else on these Benches—I would like to see conditions whereby power workers and the like can make the voluntary decision that they will not strike. But that must go with a proper agreement on conditions, arbitration and wages. I hope that we may get an amendment put forward by the noble Lord, Lord Boyd-Carpenter, which will take in all that; otherwise we shall go back to the 1926 position when there was a vicious blow at the Civil Service in the form of the Trade Disputes Act after the 1926 strike.

The Bill excludes disputes relating to matters outside the United Kingdom. This ignores the tendency for action being taken more and more by multinationals. It hits also at the question of international solidarity. One can think of many issues where workers in this country might feel that they should take action, and even noble Lords on the other side might possibly think of certain circumstances where they would like to see that action taken, but the Bill will prevent it.

The Bill also gives increased power to employers over the dismissal of workers taking part in a strike or other industrial action. Under the Bill an employer will be able to offer re-engagement to only some workers after a period of three months or more, without being liable to a charge of unfair dismissal as regards those not re-engaged. I cannot look at this in any other way than as an encouragement—even incitement—to employers to use intimidation. It presents an opportunity to get rid of union activists without fear of being taken to an industrial tribunal. I hope that I am wrong. I hope that the noble Earl who is to reply will correct me on that matter, but that is my reading of the Notes on Clauses which the Government have kindly made available. This has little to do with unions being outside the law; it will, of course, be aimed at weakening trade union organisation.

The proposal for compensation to non-unionists who are dismissed in relation to closed shops surely, as has been said by one or two noble Lords already, is a financial inducement to drop out of trade union membership. Prominent individuals outside the trade union movement have said that it represents too much scope for exploitation by the unscrupulous individual who is attracted by the possibility of money. There is a great deal of money involved: a minimum of £2,000 which could rise to £22,000.

There is much emphasis being placed on conscience. I want to repeat what I have said previously in this House. In some circles I am regarded as a moderate; but I side with those who also have a conscience—a conscience about those who are ready to accept all the advantages of trade union membership and activity, but who refuse to associate themselves with any responsibility for that activity. There is considerable resentment over free-riders, and the Bill presents a charter for free-riders. I would suggest that the proposals will cause considerable bitterness on many a shop floor.

The General Council of British Shipping in a press release in January this year stated: It "— that is the council— believes that the minimum levels of compensation specified for unfair dismissal in these circumstances are likely to encourage some employees to engineer their dismissal for non-compliance with a union membership agreement ". That was a statement made by the shipping employers' organisation. There are now some 5.2 million workers covered, as the noble Lord, Lord Aylestone, said, by union membership agreements in closed shops. I suggest that the proposals for regular balloting and voting figures required-85 per cent. of those voting; 80 per cent. of those who are covered by the agreement —will do nothing whatever to help industrial relations. Let us say that it is only 84 per cent. or 79 per cent. One has a hopeless position in trying to get satisfactory industrial conditions. Other employers have expressed concern.

The same release by the General Council of British Shipping stated: GCBS believes that the method proposed for ensuring periodic reviews of existing closed shop agreements is likely to cause employers considerable practical difficulties and involve unnecessary disruption of long-standing and generally acceptable arrangements ". I understand that the Council of Shipping have made approaches to the Secretary of State because of the special problems of shipping and the impossibility of getting these voting percentages, and they have asked that balloting, as far as the shipping industry is concerned, be deferred for five years. However, I understand that at present they have had no reply. The shipping industry has had a closed shop since 1921, with comparatively no problems whatever.

I have mentioned that other employers have expressed similar concern. I shall mention one other—the Co-operative Wholesale Society, a closed shop since 1919. They say that in the last 12 years only 100th of 1 per cent. of total working days has been lost through industrial action. There is no suggestion there that industrial action is encouraged by a closed shop arrangement. That organisation fears that proposals in the Bill will have serious and disrupting effects on the good relations that have been built up over that period of some 73 years.

The Observer on 16th May carried a story by Robert Taylor about a Government-commissioned study on the closed shop. They state that this report by Professor John Gennard of Strathclyde University, commissioned by the Government, has been in the hands of the department since December, but has not yet been published. The Observer claim to have a copy of that report and, contrary to Mr. Tebbitt's claim that closed shops: reinforce restrictive practices and damage competitiveness it suggests that the report of a study of more than 1,000 private sector companies as well as nationalised industries found that only 12 per cent. of managers considered that the post-entry closed shop encouraged inefficiencies. It also states: Employers and unions report few problems arising from individuals protesting over the introduction of the closed shop ". I shall content myself with those two quotations. But I would ask the Minister: Is such a report in the hands of the department? If so, is there any reason why it has not yet been published? Will it be published before we conclude the final stages of this Bill?

That the Bill is a charter for non-unionism is made clear by the provisions in Clause 11, which make it unlawful to have a trade union clause as a condition of contracts. Many of us, as customers giving business, want to know that the persons to whom we arc giving business have trade union agreements. All the years I have placed election printing, I have wanted a "fair list ". I am going to be denied a "fair list" now. As a ratepayer I would like my local authority to give contracts only to firms which observed proper trade union conditions and did not undercut. I am going to be denied that under the provisions of the Bill. If ever there was a deliberate legislative attempt to encourage non-unionism, I believe that that provision in that clause is it. Sub-contracting to those who undercut wages and prices with non-union labour will now be given legal approval if this clause is passed. Firms that desire to keep good relations, built up with their workforce over a period of years, may find that they are undercut by a non-union firm.

I would ask a question of the Minister. Under Clause 12, where an employer takes supplies of materials from another firm which does not recognise trade union agreements and which undercuts wage rates, and, in consequence, the workers decide to take industrial action, will that be unlawful under this Bill?— because, if so, we are in for a period of chaos in industrial relations.

Reverting to the compensation proposals, at Third Reading in another place on 19th May at column 401, Mr. Tebbit said: There has been talk of free riders, but no conclusive evidence that the unions have always brought benefits to their members. Indeed, there is often evidence to the contrary.

Several noble Lords

Hear, hear!

Lord Underhill

My Lords, I hear Members say "Hear, hear", but it is a very strange statement from the Secretary of State for Employment, whose duty it is to get the best possible industrial relations with trade unions and with employers. The Secretary of State is not here, but I would put a question to him. Surely he must have read the reports of the Trades Union Congress from time to time'? Surely he must have read the reports of various unions '? Surely it is recognised that unions do not just exist for strikes, that these reports will show the vast amount of constructive activity which is carried out by trade unions? I should like to see that reflected in the statement of the Secretary of State, but I regret to say that it is not there.

The Minister of State, Ministry of Agriculture, Fisheries and Food (Earl Ferrers)

My Lords, if I may just interrupt the noble Lord, Lord Underhill I do so with great hesitation—he will recall the fact that my right honourable friend said, in the statement which he quoted, that trade unions do not "always" bring benefits to their members.

Lord Underhill

My Lords, I appreciate the intervention by the noble Earl, but if one looks at all the statements made by the Secretary of State, one finds that they always have this bent towards anti-trade unionism. That is the point that I am trying to make. Almost the last words of the last paragraph of the speech which the Secretary of State made at Third Reading are: The Bill is another step on the road to improving our industrial relations ". In view of the comments that I and others have made, surely he must have had his tongue in his cheek when he said that, because, whatever else the Bill will do, it certainly will not improve industrial relations. I believe that it is likely to increase bitterness. The Bill has running through it a thread that non-trade unionism is as good as unionism. In fact, non-unionism seems to be praised by many of the provisions of this Bill.

5.13 p.m.

Lord Marsh

My Lords, it is always a great pleasure to follow the noble Lord, Lord Underhill, who, as he says, has a reputation—and justifiably so—as a moderate man. That is what concerns me very much from some of the remarks which he has made, because they were strange remarks coming from a moderate man. For example, he says that the Bill sets out to suggest, and people's speeches indicate, that a non-unionist is as good as a unionist. But some people hold that view and there is nothing wrong with that. This is the worrying position which the opposition to the Bill demonstrates: that we have reached a situation where it is regarded as almost obscene to make any critical comment at all about a very large, and great, trade union movement. That cannot be so. People are entitled to believe that trade unions are right, and we uphold the right of such people.

But in a free society people also have a right to take a view which Mr. Scargill might find unacceptable. I agree with a lot of what the noble Lord said; that in this country we exaggerate the amount of time that we lose to strikes, but the Bill does not outlaw strikes. In fact, we are not concerned about normal, traditional trade union activity, which has existed and grown under parties of both colours and where relationships have been very good. I would also agree that the Bill is not a major contribution to the much wider problem of industrial relations in general. In fact, it is a very modest little Bill; it does not actually do very much. I suspect that at a later stage there will be major issues, such as the possibility of the introduction of some form of lay-off clause to redress the imbalance which exists between organised labour and employers today. That may well be raised in Committee.

The noble Lord said—it is this extreme attitude of people that puzzles me—that the Bill is an incitement to employers to intimidate employees. Anybody who is involved in modern industry today would recognise that the ability of the normal employer to intimidate his employees may be a happy thought, but it is no longer a major problem in British industry. Indeed, the situation now is that the trade union movement is an integral part of industry.

For a period I was chairman of a nationalised industry, and I am bound to say that if a Member of Parliament had telephoned asking to see me at the same time as Mr. Sidney Green asked to see me, with no disrespect to Parliament, I have little doubt that Mr. Sidney Green would automatically have been put first. The trade unions are no longer fighting for their right to be treated in a normal responsible fashion.

I cannot remember another issue which has produced such an irrational and exaggerated reaction as this Bill. That, I think, is the most significant thing about it. It is this belief, which has been revealed, that these rights and traditions must not only be maintained but that it is wrong that they should at any time be questioned by anybody, even Parliament. That is a very dangerous view for any group to take in a free society, whether they be soldiers, industrialists or trade unionists.

I listened to the speech of the noble Lord, Lord McCarthy, with growing disbelief as he described the Bill—I made a note at the time—as a major assault on trade union privileges designed: to push the trade unions into the ground ". I am bound to say that, if this is a example of that cold, clinical, intellectual objectivity which he brings to industrial problems upon which he is asked to advise and arbitrate, I can only hope with all my heart that he enjoys a long and very early retirement, because I cannot believe that any industry deserves help of that kind.

For nine years prior to my election to another place I was a full-time national official of the National Union of Public Employees. During those nine years—and I hasten to add not through my efforts—the National Union of Public Employees enjoyed the fastest rate of growth of any trade union affiliated to the Trades Union Congress. The living standards of its members rose considerable. Its General Secretary, Bryn Roberts at that time, who was well known to many noble Lords, was never described as a moderate and he would have been deeply offended if he ever had been.

In my view there is nothing in this Bill which would have impeded me or any other union official at any point throughout those years. Indeed, the noble Lord, Lord Houghton, is to speak tonight together with other noble Lords who have much more experience of the trade union movement than I. I would be interested to hear of specific examples where this Bill would be a threat to normal trade union activity. If it were, I would join in opposing the Bill, because the right of people to combine is fundamental to a free society.

Democracy is all about pressure groups and those very many Members of this House who have served in another place know only too well of the thousands of organisations which seek to protect and promote the interests of groups with a common interest. They range from the CBI to the pigeon fanciers, to the various ethnic groups, from the trade unions to the environmentalists and the religious groups. That is what parliamentary democracy is about. It is about groups of people making their voice heard and ensuring that their interests are protected. They are all an integral part of our society. and it is right that their rights be protected.

Lord Wedderburn of Charlton

My Lords, as the noble Lord has laughed to scorn my noble friend's suggestion that the Bill attacks the rights of trade unions, and in other ways laughed to scorn the idea that it has a serious effect, will he tell your Lordships what he thinks is the meaning of the new power to dismiss those on strike and the redefinition of the term "trade dispute" in respect of trade union rights?

Lord Marsh

My Lords, I will come to that because that is basically what we are debating this afternoon, and I had therefore intended to deal with it. The Bill makes changes. It would be difficult to produce a Bill before Parliament that did not make changes. What I am questioning is whether it represents a threat to the genuine, justifiable rights of a free trade union in a free society. The definition of the rights which need to be protected of the trade union movement have been defined clearly and concisely by the General Secretary of the TUC, Mr. Len Murray. I quote: We only claim three rights: the right to combine in order to pursue the collective interests of our members, the right to be recognised by employers for collective bargaining purposes and the right not to work except on terms and conditions which have been agreed with an employer. These are the characteristic rights of free trade unions in all democratic countries. I take no exception to any of that. There is nothing in this Bill which impedes any one of those three rights. It does not stop people pursuing their normal trade union activities at any point.

The noble Lord, Lord McCarthy, said that the Bill would prevent unions helping weaker members of the trade union movement. This is a new one. I do not know why there should have been any difficulty, because the nurses have been around for a long time. We have had a National Health Service since the 1940s. We have had a nationalised coal mining industry since the 1940s. If the unions in the public sector want to help the lower paid—after all, it all comes out of the same purse—I wonder whether they would be willing to consider a pay policy for the public sector which ensured that nurses had a fair crack of the whip and a fair slice of the cake, which might be perhaps to the disadvantage of more powerful unions left in a free society.

The British trade union movement—I do not criticise it for this at all—is pre-Adam Smith in its attachment to market forces. Trade unionism is all about the use of power to obtain the highest price you can for the labour you are selling. It is the sort of thing that would have qualified my noble friend Lord Harris of High Cross, and he would go along with it totally. I can see him at some later stage as a leading member of one of the trade unions. This picture of the tough guys of the big battalions of the Trades Union Congress going to the rescue of the nurses elevates hypocrisy to an art form, because largely one of the things which has given rise to this Bill is secondary action designed to achieve political ends. That is what assisting the nurses is about on this occasion.

Trade union leaders—there is no dispute about this —have made it clear. They are quite open about what they were doing. On Friday Mr. McGahey urged his 16,500 members—and I quote from the Morning Star—to, take a rest day ' and not cross nurses' picket lines at the pit on June 23rd. Their stand, declared at the Scottish Miners' Gala in Edinburgh, won immediate praise from British TUC chairperson Alan Sapper …Mr. Sapper described such unity of the miners "— he is a very clear-headed chap, he uses words carefully— with the nurses as the way to beat the government's anti-union laws, against which we may have to develop a general strike of a trade union movement '. No reference to nurses' pay in that particular comment.

It was not just Mr. Sapper, because Mr. Arthur Scargill, whose credentials as a defender of democracy are well-known, told the South Wales Miners' Gala in Cardiff yesterday: The best way to oppose the Tebbit Bill is to support the nurses and health workers. If one really set out to do a D.Phil. in cynicism one would have some pretty good working documents to start with. This is openly announced and is the basis of this new-found support in this particular area.

Immunities granted nearly 80 years ago were essential, and the country and ordinary people benefited from the developments which flowed from the existence of those immunities. They were essential because they were needed to enable the poor and the exploited to combine to protect themselves against the rich and the powerful. It is absurd to suggest that the same situation exists today. The assets of the British trade unions today are counted not in tens of millions of pounds but in hundreds of millions of pounds.

I am not quite sure what the noble Lord is muttering. He is possibly thinking aloud. You cannot argue that the trade unions are not capable of defending themselves against the rest of society. Lawyers who are lucky enough to be engaged and accepted in the trade union field are among the richest and best-paid in the country. The unions litigate far more than almost any other organisation. They have the funds to do it, and quite right and proper too. Not only are they now, and quite properly, represented in Parliament—this was one of the other problems, they were unrepresented—but they actually own the Opposition. That was not foreseen 80 years ago.

As they demonstrated, they are, when they wish to use their powers, more powerful than the Government themselves, as a former Prime Minister discovered. Increasingly a minority of trade union leaders proclaim their clear intention to use their trade union power to challenge governments of both parties. It was a major problem when the Labour Government were in office in the early 1960s. It was a major problem with subsequent Conservative Governments. It is not a problem confined to any one party. It is a direct challenge, possibly not even consciously, time and time again to the elected Government of the country, and it increasingly happens. This is a relatively new development, and it is an intolerable development.

Over the years trade union leaders have come with many different political colours. Some of the great ones, like Arthur Horner and Will Paynter, were openly avowed loyal, dedicated members of the Communist Party, but never did they confuse their trade union role with the role of a political party within a democracy. Indeed, the Labour Party has always set its face over the years—I do not think it has changed—against any sort of syndicalism. The division between the trade union movement and the political wing has always been a clear one.

It was not until the 1960s that we began to experience a new type of industrial action designed quite openly to cause misery and suffering not to bloated capitalists but to ordinary citizens who were not involved in the dispute and had, and have, no way in which they could seek protection or redress. That had not happened in the years previously. From 1926 until the 1960s strikes and major disputes in the public sector were virtually unknown. It was only in the 1960s that they began increasingly to be used, because they were the vehicles which could apply most pressure to ordinary people; which could prevent ordinary people from burying their dead; which could make ordinary workers travelling to work suffer the agonies of unplanned disruptions. That happened from the 1960s, and began to increase.

How can anyone justify a situation where sick people, certified so by qualified doctors, are prevented from receiving treatment in State hospitals in an effort to exert pressure on an elected Government? That is not the Labour movement that I belonged to for a long time. That is not the view which would be acceptable to many people in the Labour Party today. With the greatest respect to some of my former colleagues in the Labour Party there are people going down this road out of a mistaken sense of loyalty.

How can you support a situation where a telephonist in a hospital can overrule a doctor and stop a woman taking her child in for treatment? Nobody believes that apart from a very small group of people whose egos have got totally out of control. If Mr. Scargill or anybody else wants to influence legislation or seek to change the Government, that is the inalienable right of any individual in this country. But when the General Secretary of the National Union of Mineworkers decides to use his union power and the unique legal immunity which goes with it to bring down the Government or block legislation passed by an elected Government, then less powerful citizens are entitled to the protection of the law and protection against the brutality of the irresponsible exercise of power and privilege which can no longer be justified.

5.31 p.m.

Viscount Caldecote

My Lords, like others, I greatly enjoyed the vigorous speech of the noble Lord, Lord Marsh, and I agreed with every word he said. To be on the safe side, I had better declare an interest in the Bill because I am a vice-president of the Engineering Employers' Federation, the principal organisation representing employers in the engineering industry, and that organisation may be said to have some special interest in the outcome of the Bill. I will spend a few minutes commenting on the attitude of the federation to the Bill, but first I wish to make a few general comments. The Bill has been fairly described as modest, but it is important, particularly to those of us who work in industry. The main purpose of the Bill is to create a better balance of power—my noble friend Lord Boyd-Carpenter made that point clearly; it is all about power—between employer and employee in negotiations and to remove injustice to individuals resulting from the substantial power of trade unions largely created by previous legislation.

Anybody who has enjoyed wielding power of any kind resents any proposals for curtailing it, so the howls of protest from the trade union movement about the curtailment of power are neither surprising nor unnatural. I am not surprised at all that the noble Lord, Lord Underhill, is a bit angry because he will no longer be able, if the Bill becomes an Act, to insist on union labour only clauses in the contracts he places. I am not surprised he is annoyed. That does not matter; the question is whether or not the practices are in the public interest, and I am sure they are not. I assure the noble Lord, Lord McCarthy, that I have nothing against trade unions when they act constructively and in their members' interest and not with political motives.

In a democracy, one of the most difficult problems to determine is the right balance between individuals or groups of individuals acting to preserve their own interests, which are often inaccurately described as their rights, and the overall interest of society as a whole, since that involves the very important issue of individual freedom. But the essence of democracy is that those balances are determined by discussion and argument and ultimately by decision in Parliament, and not by force or threats of force. Although, therefore, there can be no criticism of any kind of the TUC and trade unions for opposing and criticising the proposals in the Bill as strongly as they wish—by argument, protest and propaganda—it would be totally wrong (I agree strongly with the comments on this by the noble Lord, Lord Marsh) to use any kind of force or damaging industrial action against the Bill or to incite people to break the law once it has become an Act.

We here should not be deterred from doing what we believe is best in the interests of the community as a whole by any such threats of militant trade unions to take that kind of action. I find it tragic that normally sensible and responsible people in the trade union movement like Mr. Len Murray should associate themselves with those threats, particularly as much evidence from opinion polls and from private discussions with trade unionists and others indicate that in reality there is widespread and substantial support for the principles of the Bill. There will of course be detailed criticism, and we shall be dealing with that in Committee.

Although we must not allow our judgement to be distorted by threats of that kind, it must be a cause of real concern if the proposals in the Bill lead to increased divisiveness and confrontation in industry or indeed in the nation as a while, for our problems in industry in meeting the growing competition from other countries and in maintaining, and eventually increasing, employment are immense. If we are to solve them, we cannot afford damaging disputes and we need the maximum degree of co-operation, particularly in the introduction of new technology. The risk of creating division and confrontation is a factor which we should take seriously, for such divisiveness could significantly detract from the value of the Bill. So in debating its detailed provisions later, in Committee, I hope we shall scrutinise every clause to ensure that it achieves the objectives of the Bill—a better balance of power and the fairer protection of individuals from the oppression of powerful trade unions—without giving any unnecessary bases for confrontation or divisiveness.

I should like to make some comments on the attiude of the Engineering Employers' Federation to the Bill. The federation is one of the most influential employer organisations in the sphere of industrial relations and it represents a substantial proportion of companies in the engineering industry, so it is important that any misunderstandings that may have arisen about its views on the Bill should be corrected. During the discussions in another place, Members of the Opposition on several occasions sought to criticise the provisions of the Bill by asserting that the Engineering Employers' Federation was opposed to certain aspects of it. I know that some of those assertations have caused considerable concern in the federation and elsewhere on the grounds that, either individually or taken as a whole, they could convey a quite misleading impression of the federation's attitude to the Bill. To avoid misunderstandings and, I hope, to prevent the possibility of similar misleading statements being made during the debates in your Lordships' House, I wish to clarify the issue as far as possible.

The engineering employers' position is one of general welcome and support for the Bill. We believe that British industrial relations and economic performance have been marred by the enjoyment and deployment of excessive union power against employers. Indeed, the EEF has strongly urged the Government to take some further measures, which are not included in the Bill, to redress the present vulnerability of the employer to industrial action. Those measures would have relieved the employer of his employment obligations, imposed by law, when his operations were interrupted either by internal guerrilla industrial action or by external strikes.

I have considerable sympathy for those suggestions, but they would have involved a major change and interference with conditions of employment and, because of their divisive effect, on balance, I am glad they have not been included in the Bill. While the Engineering Employers' Federation is disappointed that the Government have not heeded their proposed remedies on that point, it is confident that the Government will not overlook them if the need is clearly demonstrated by any rising tide of irresponsible action in the future. In the meantime, just as we welcomed the 1980 Act, we in the EEF welcome this 1982 Bill. It will, I am sure, in the long-term promote greater union responsibility and more objective standards of industrial relations behaviour.

The Bill contains many important and highly desirable clauses. It imposes greater liability on unions where they procure the dismissal of non-members. It makes the law on the dismissal of strikers less oppressive on employers. It prohibits union-labour-only clauses in contracts; reduces the excessive legal immunity of unions for wrongful acts, and establishes the principle of vicarious liability for the wrongful acts of union officials, and it narrows, too, the excessively wide definition of a trade dispute. Such provisions—and they are taken for granted in the great majority of civilised industrial nations—are all firmly supported by the federation.

The main area in the Bill where we in the EEF had some differences of view from the Government related to the closed shop provisions. But the difference here has greatly narrowed since the original proposals for legislation were published. The Government have, for instance, taken note of the EEF's comments on the excessive levels of compensation originally proposed and on the need for the individual's conduct to be taken into account when assessing compensation; and changes have been made in the Bill accordingly.

Just as welcome to the federation has been the Government's acceptance that the balloting provision for existing closed shops will be deferred for one or two years after enactment, to allow the parties time to adjust to the changes in the industrial relations scene. I believe that this is a most important change, for although I abhor the principle of the closed shop, I have some real doubts about the wisdom of disturbing existing closed shop arrangements which are working smoothly; and, as has already been mentioned, there are real problems in the shipping industry which will need further consideration. But all these issues will no doubt be fully discussed in the Committee stage.

Thus, the Engineering Employers' Federation appreciates and fully supports the changes that have been made in response to the views that it has put forward, and it has no further changes that it wants to propose in the closed shop provisions.

I hope that these comments, for which, I of course take full responsibility, will dispel any doubt as to the federation's overall firm support and welcome for the Bill. It is I believe a good Bill, and a necessary one. To argue, as many in the Opposition, and in the trade unions have done, that it is a bad Bill because the law has no part in industrial relations is clearly a nonsense, for the whole basis of trade union power and immunities stems from previous legislation.

But, of course, the purpose of an Act of Parliament is to create a legal environment in which constructive industrial relations can flourish and grow; but that can happen only if all the people of good will, employers and employees, whether or not in trade unions, are determined to minimise confrontation and not to use industrial disputes to become weapons employed in a political power struggle. I am convinced that the Bill can help to provide a firmer and a better foundation for constructive industrial relations, and I warmly support it.

5.44 p.m.

Lord Oram

My Lords, it was important that the noble Viscount, Lord Caldecote, should have taken this opportunity to clarify (as he put it) the views of his federation, because, as he no doubt knows, back in April his director-general approached the Bill in a very different way. I have no doubt that there were considerable comings and goings about what Dr. James McFarlane said before the federation, through its present spokesman, reached its current attitude. I say that, because Dr. McFarlane referred to the federation having no enthusiasm for the Bill. He said: We will have to live with the consequences of the legislation as best we can ". He also referred to the federation's, reluctance to back the Government's desire to lay open union funds to actions for civil damages"— and so on. I hope that the noble Viscount has cleared his message with his own director-general—

Viscount Caldecote

My Lords, may I say to the noble Lord that the views that I expressed were views that I have discussed with my colleagues in the federation, and I should not like the noble Lord to leave any impression that there is dissension. Surely the point of the kind of discussions that have been going on over the past few months is to reach agreement, to narrow differences. Surely it is wrong to complain that something that has been said early on is different from the view that is now expressed. That is the point of discussion and negotiation.

Lord Oram

My Lords, that is what I meant by assuming that there had been considerable comings and goings in the interim before the formula had been developed.

In my view not only is the Bill unacceptable for the reasons put forward by my noble friends Lord McCarthy and Lord Underhill, but it strikes me as being particularly untimely, because we have now had a whole decade of disturbance in the field of trade union legislation. It started more than a decade ago, in 1971, with the Industrial Relations Act, and three years of turmoil followed that. Then we had a Labour Administration who repealed that Act, re-enacted trade union rights, of which trade unions had been deprived, established ACAS, and did other things. Then a few years later the present Government reversed engines once more and we had the 1980 Act. Obviously that was very unwelcome to the trade union movement and was opposed in Parliament by my party.

But unwelcome though the 1980 Act was, at least I think we could have hoped—as I think the noble Lord, Lord Rochester, hoped—that it marked the end, if only for a reasonable period, of the disturbing tug-of-war in trade union legislation between the parties. At least—to use current language—we might have hoped for a cease-fire, even if we had not achieved a lasting peace. The 1980 Act caused considerable ill will in industry, it stirred up a great deal of dust; and surely it would have been better to let the dust settle before stirring it all up again with another, even more divisive, Bill. That is why I say that, quite apart from the particular merits of clauses of the Bill, it is undoubtedly divisive and in the present situation it has been untimely to bring it in.

What we have all been struggling for over the decade and vigorously arguing about is how to establish good industrial relations by law. Surely in the 10 years one lesson that we should have learnt, if no other—and it was spelt out in the Government's Green Paper on trade union immunities—is that, good industrial relations cannot simply be legislated into existence ". But if that is true—and I believe it to be true—if legislation cannot create good industrial relations, it is also true, very true, that bad legislation can certainly undermine good industrial relations. That is what the 1971 Act did, and I believe that it is what this Bill also will do.

If we look at industry and commerce and the problems that they are facing, do we do not see that we have enough trouble without creating more problems gratuitously? We have a world recession; we have inflation and the consequent threats of widespread industrial action over wage claims; we have mass unemployment, and all the industrial bitterness that flows from that. Surely that is enough for us all to be wrestling with, without unnecessarily bringing in this divisive Bill.

Of course, the Government try to suggest—the noble Lord, Lord Marsh, followed this—that it is not so radical a Bill as we on these Benches believe it to be. It is said that it is a modest Bill. It is supposed to be just one more step in the famous step-by-step approach to trade union legislation. But there are steps and steps. I remember that when Neil Armstrong stepped on to the moon in 1969 he said: That's one small step for a man, but a giant leap for mankind. I believe that this Bill is not one small step in trade union legislation; it is one giant leap. Moreover, it is not a leap forward; it is a leap backward. I believe it is true to say that in one important respect it takes us back to the Taff Vale judgment in 1901, which placed trade union funds in jeopardy. That is the effect of Clause 13 taken together with Clause 16, which place considerable new limits on the definition of a trade dispute. It is my belief that the Bill opens the way for trade union funds to be under constant attack and constant erosion in the courts, and that, I believe, is its purpose.

But there is a second main purpose of the Bill which makes it so objectionable to me. Much of the Bill—and it has been much of the debate so far—is designed to hamper trade unions in their perfectly legitimate pursuit of 100 per cent. trade unionism, and it does that in a number of ways. First of all, as was put forward earlier, it encourages non-unionists by tempting them to discover in their hearts deeply-held convictions, which perhaps were not there before, against union membership because of the prospect of considerable financial rewards if they find themselves dismissed as a consequence. It even proposes retroactive compensation for a mythical 400 people who were supposed to be victims in the period between 1974 and 1980.

When this Bill was going through another place the Government spokesmen were constantly asked for evidence about those 400 victims. No evidence was forthcoming. I hope there may be at least some semblance of evidence in the debates in this Chamber, but I noticed that in Lord Cockfield's speech he again referred only to those two cases which were constantly brought up in another place. Moreover, on that point, I would call the attention of the House to the fact that the British Institute of Management argues in its memorandum most cogently against that particular retroactive provision of the Bill.

The Bill also hampers 100 per cent. unionism by imposing quite excessive conditions for the establishment of union membership agreements. The 80 per cent. and 85 per cent. formulae, I believe, are quite prohibitive and ought to be changed. It hampers 100 per cent. trade unionism by outlawing contracts which stipulate the employment of trade union labour only, and that is an essential means whereby workers can ensure that their living standards are not undermined by cowboys or by whatever else such contractors can be called.

These proposals threaten to disrupt existing arrangements which have been worked out voluntarily by employers and trade unions, and some employees have expressed their considerable anxieties about the disruption in industry that is likely to be caused. Despite the speech, to which we listened with interest, from the noble Viscount, Lord Caldecote, I cannot but believe that the earlier expression by their director-general reflected considerable anxiety throughout the engineering industry about the effect it would have on their existing, currently stable arrangements between employers and trade unions.

Support for that point of view comes to me also from a sector of commerce with which I am personally more familiar, the co-operative movement—and my noble friend Lord Underhill made reference to this. I have had correspondence from both the Co-operative Wholesale Society and the Co-operative Employers' Association, which acts on behalf of the retail societies in this matter. They declare that for many years they have operated closed shop agreements satisfactorily with a whole range of trade unions, and they are very concerned about the potentially disruptive effects of the Bill's provisions upon the stable relationships with trade unions that have been developed by them.

They are particularly concerned about the requirements for ballots as they are contained in the Bill. The CWS happens to be a particularly large and a particularly complex organisation, but I am sure that what applies to them must also apply to many other conglomerate businesses. May I quote from an article in the Guardian of 3rd February written by Mr. Dennis Landau, who is the chief executive of the CWS, to illustrate the difficulties that he sees in these matters and which, as I suggest, must be paralleled in many other major businesses. He says: The proposals about closed shops '… could have considerable consequences for employers with such agreements. The CWS has operated ` closed shops' since 1919. To comply with changes in the law, in 1977 we signed trade union membership agreements. There are 44 of these, 22 with single unions and 22 with combinations of unions. For these to remain effective and for dismissal for noncompliance to remain fair if Mr. Tebbit's proposals become law, we would have to arrange to conduct separate ballots for each of these agreements covering all CWS employees. These ballots would have to take place within 12 months of the proposals becoming law, and then again within each five years period ". I would merely add the comment: what an unnecessary administrative burden to place upon a management anxious to get on with managing its business!

I believe that this Bill is not only disruptive of trade union rights, as has been explained by my noble friend Lord McCarthy—it is certainly that—but, as I have indicated, I believe it to be potentially disruptive of the operations of many smooth-running businesses. It is for that and for many other reasons that I believe it to be a bad Bill. Indeed, the Trades Union Congress has gone as far as to say that it is so bad that it cannot be usefully amended. I do not take that view and I believe that my noble friends do not take that view. I believe it to be the duty of this House to seek to improve it, even if we are poles apart about the Bill's basic purposes. For example, I read in The Times that Mr. Tebbit is favourablydisposed—and I think that the noble Viscount, Lord Caldecote, backed this up—to some postponement of the ballot arrangements. I hope that that is so. I hope that it is a sign of some flexibility in one who hitherto has been essentially an inflexible man. I hope that we can find some flexibility in your Lordships' House that was not available in another place. Therefore, despite the fact that I have expressed, as have my noble friends, deep-felt hostility to this Bill in its general principles, I hope that we can look forward to a constructive Committee stage and Report stage so that we can, at least, try to make this bad Bill just a little less bad.

6.1 p.m.

Earl De La Warr

My Lords, in April 1981 we had a debate in this House on the Green Paper entitled Trade Union Immunities. I was one of those who spoke very strongly against having any more industrial legislation in the lifetime of this Parliament. I did so because I believed then, and I believe now, like the noble Lord, Lord Oram, that in the last decade we have had far too much industrial legislation. This sort of legislation is immensely sensitive. Each time a new Act comes along it confuses management and staff alike and inhibits for far too long the efforts being made to improve communications between management and workers. So I will confine myself to saying just this: I beg my right honourable friend the Secretary of State for Employment to turn his great energies and abilities to other aspects of his job—Heaven knows, there are enough—and lay off bringing forward any more Bills of this type in the foreseeable future.

Having said that, I believe this to be a brave Bill and good one, although I must say that it is a highly legalistic one. There is hardly a clause which does not deal with somebody seeking an injunction or damages against someone else for something. Noble Lords must not be surprised if certain things that are supposed to happen in this Bill in fact do not happen. For instance, I doubt very much if employers and unions will have much to do with ballots every five years for existing closed shops. We hear that there is to be a two-year delay. So much the better. Perhaps during that time they will be able to find other means by which they can remove some of the more obnoxious facets of the closed shop—and I mean in particular the threat of dismissal that hangs over the heads of so many people.

By the same token, I should be very surprised if any local authority which chose to go on insisting on union-labour-only clauses actually found itself being sued by an aggrieved contractor. At the risk of being facetious, I must say that in the world of business it is not often thought to be good marketing practice to slap in an injunction against a customer or even a lost customer. You come to be thought to be rather a litigious sort of supplier and tend to become unpopular. I recall that, 20 years ago, the company for which I then worked, which dealt with television and overseas television, had the temerity to haul up the Government of Hong Kong before the Judicial Committee of the Privy Council. We won—and we have borne the scars of our victory ever since.

Likewise, I believe it more than possible that a company, however large, would not in fact wish to take a trade union to the courts. Businessmen do not really behave in that sort of way. We have to remember that this Bill, like the Employment Act 1980, labels certain facts, certain acts, as unfair or tortious and enables the aggrieved party to go to a civil court for redress. But whether the party seeks redress is a decision which is left entirely to him. I think that this simple proposition is something that often is forgotten when we talk about these things in Parliament.

It has been very difficult to measure the effect of the 1980 Act and there is very little information to help us decide. Has it worked? Well, my feeling is, on balance, yes. There has been some greater regard for what is lawful and what is not; but I insist that it has not had very much time. All the same questions will apply to this Bill when it becomes law.

The department have been remarkably reticent with facts or conclusions about the effects of the 1980 Act. Let us hope that in due course it may be possible to find out more about the effects of this Bill and to make the facts and conclusions (whether or not one agrees with them) more widely available. Meanwhile, I will make my own guess. It is that very gradually the new framework in which this side of industrial relations should be conducted will come to be accepted until it is part of the background. When that happens, if it happens, the Government will be able to congratulate themselves—but not, I suggest, before then.

Before I go on to my final point, let me say two things about the ending of immunities from tort on trade unions when they are found to be outside the bounds of a trade dispute. First, we are entitled to assume, and I do assume, that companies, if they make use of the provisions, will only make use of them as a very last resort. Secondly, and more generally, the principle that no one is above the law is one of which I heartily approve, and I am very glad that the Government have seen fit to grasp this nettle. I am afraid that shrill cries about Taff Vale leave me unmoved. Perhaps I was too young at the time. I simply do not believe that the union movement will wither in any way as a result of these new laws, and neither do I believe that it is the Government's intention that it should.

Finally, I have one regret about this Bill, not because of something that is in it but because of something that is missing. I believe it to be an important opportunity that has been missed. What has not been in it, and what I should like to see, is a simple clause, with none of the highly legalistic stuff which characterises the Bill as it is, the purpose of which (it will not be unfamiliar to your Lordships) is to enable the Secretary of State to require all unions to alter their rule books over a stated period so that they themselves would make it obligatory for there to be elections by secret ballots at least every five years for their chief officers.

We talk a lot about the need for the unions to regulate and reform themselves. Some talk with friendliness and some talk with hostility. I suggest to your Lordships that the best way to look at it—certainly it is one way—is like this. First, the unions are here to stay and they are an extremely important part of the body politic. Secondly, the prime cause of their misuse of power is that in too many cases the leadership has got into the hands of militant extremists.

Thirdly, the vast majority of trade unionists who have become apathetic through inability to control would welcome the chance to elect their officers and thus have some say in the affairs of the strategy of their union. It is well known that some union leaders are appointed by their executive committee, the members of which have been elected by considerably less than 5 per cent. of the union membership. I believe that if we could achieve this it would over a period transform the attitude of the unions and their members to employees and to society.

At Report stage in another place a new clause was due to be moved by my right honourable friend Mr. Renton and others to give effect to this. For a number of reasons (which I shall gloss over) it never received a hearing before the Bill ran out of time. I believe it to be immensly important to see that this clause goes into the Bill. This is not only because of the extreme value of the clause itself but because it is wholly within the traditions of your Lordships' House—and, indeed, part of their duty—to see that amendments that never received a hearing in the other place should be sent back if they find favour with your Lordships so that they may be looked at there for the first time. It is my earnest hope, therefore, that the Government will accept this clause which I shall be moving at Committee stage and thus further improve what is already a very good Bill.

6.15 p.m.

Lord Harris of High Cross

My Lords, this is my first opportunity to follow the noble Earl, Lord De La Warr. I congratulate him on delivering from the Tory Benches a rather half-hearted speech in support of the Bill, and I think that he almost set an example in brevity which I shall try myself to follow.

Listening from the Cross-Benches to some of the vigorous speeches—particularly by the noble Lords, Lord McCarthy and Lord Underhill—I find myself also regretting that this Bill should risk aggravating party divisions, especially on this day when we have seen what great purposes can be achieved by national unity. But my spirits were restored by the tonic from the noble Lord, Lord Marsh, and I must say that I agree with him; I cannot honestly believe that outside the contracting confines of the Labour Party the blame for contention can be laid at the door of Mr. Tebbit's mild—and I believe even inadequate—reforms.

In the press advertising campaign last week the TUC said that this Bill is "trying to crush trade unions". Like the noble Lord, Lord Marsh, I can think of some trade union leaders who could do with a bit of crushing. But I want to explain why I think the TUC claim is so misguided, by reference to German unions which have achieved so much more for their members without the privileges demanded with menaces by the TUC and their dwindling friends.

If this Bill were passed unchanged, British trade union leaders would still enjoy massive powers not available to their German counterparts. The proof is set forth in the Green Paper on immunities of January last year. Thus in Germany the closed shop is illegal and membership of the 17 industrial unions ranges from above 90 per cent. down to 10 per cent. In Germany, collective agreements are binding and trade unions can be sued like other responsible bodies for breach of contract. The rules of all but one of the 17 German unions require a 75 per cent. vote in a secret ballot to approve industrial action. Finally, German public servants have no right to strike, and indeed for all unions political strikes and political affiliations are forbidden.

I believe the contrast with Germany is instructive because since the beginning of this century average British wages have fallen from almost double the German level to nearer one half today. My argument —which I know will shock the noble Lord, Lord Underhill—is that the chief cause of our long relative economic decline has been the unique power of British trade unions to restrict flexibility and efficiency, to obstruct or sterilise investment, to discourage managements in all endeavours and so to retard economic progress.

It is legendary that professional economists have wide disagreements. But I believe that most will accept that a necessary if not a sufficient condition for economic progress must be the continuous adaptation of working methods to match ceaseless changes in techniques, products, competition, comparative costs and consumer demand.

To go back to the TUC commercial last week, I thought its most inventive claim was that trade unions "stand for the future". Trade unions stand for the future like the Argentine junta stands for sweetness and light. It would be a closer approximation to the truth to say that British trade unions include the most backward-looking, nostalgic and reactionary bodies since the Society for the Preservation of Rural England.

It is sometimes thought that such museum pieces as the ASLEF train drivers, the printers, the dockers, the TV crews and even the miners are passing aberrations, and that they are exceptional in their obstruction to efficiency. But a truer observation, in my view, would be that British trade unions have historically too often stood for restrictionism. And their overbearing legal powers have first magnified and then institutionalised the natural human resistance to change which is one of the most common barriers to economic progress.

For historical evidence, I will offer two episodes in the long catalogue of Luddism. The first goes back to 1897, when the new model trade union, the Amalgamated Society of Engineers, went on strike over the manning of machines—how many men to a machine was the issue. My witness is the Cambridge Professor of Economics at that time, Alfred Marshall, who was known to be a warmer friend of trade unions and of the co-operative movement than he ever would have been of the employers. Not wishing to take sides publicly against the union, he poured out his frustrations in a private letter to the Master of Balliol, which included the following sentence: If the men should win and. I were an engineering employer, I would sell my works for anything I could get and emigrate to America ". He went on in a later letter to refer to trade union restrictions in the bricklayers' union; and on locomotives he noted this: Three Glasgow men needed to do the work of one American. Marshall did not by any means exempt complacent management from his strictures, but he saw the greatest threat to what he called "national wellbeing" as, in his words, the dominance in some unions of the desire to ' make work ' and an increase in their power to do so. That was before 1906, when the Liberal Government were pressurised into conceding these large immunities in the teeth of strong opposition from Asquith and his legal colleagues in that Cabinet.

My second example of the arch conservatism of trade unions is drawn from the recent war. After 1939 it was discovered very quickly that the munitions industries could not work with the customary restrictions on entry, manning and demarcation. It was also found that for many jobs girls could be trained in a few months to replace time-served craftsmen, who had been called up. The official war history rather delicately describes this episode and mentions how even Ernie Bevin, formerly a trades union secretary, as we know, and wartime Minister of Labour, was unable to get agreement to what was called "dilution" from his trade union colleagues without a cast-iron guarantee to revert to the status quo ante the moment the war was over. So it came about that in 1942 Parliament turned aside from more pressing business to pass a full-blown statute, the Restoration of Pre-War Trade Practices Act. Its explicit purpose was to ensure that the efficient methods devised to win the war should not be available in helping to win the peace—

Lord Lee of Newton

My Lords, will the noble Lord allow me to intervene?

Lord Harris of High Cross

Surely.

Lord Lee of Newton

My Lords, will the noble Lord say what trade union ever asked after the war for the restitution of those practices?

Lord Harris of High Cross

One single trade union, my Lords, that asked—?

Lord Lee of Newton

—That any single trade union ever asked Ernie Bevin for the restitution of the pre-war practices

Lord Harris of High Cross

My Lords, I am so sorry. I have read the official history, and it indicates that the unions demanded these arrangements and they were delivered during the war.

Lord Lee of Newton

My Lords, they certainly had the right to ask at the end of hostilities. Did any of them ask for them?

Several noble Lords

Order, Order!

Lord Harris of High Cross

My Lords, I want to emphasise that I do not doubt for one moment that many of the early pioneers and the modern inheritors of the trade union mantle were, and are, inspired by lofty idealism and voluntary action. It seems to me that the real error of many of their more political colleagues has been to seek higher wages through monopoly pressure and restrictionism rather than through efficiency and expansion in marketable output. Their astonishing, if unintended, achievement has been simultaneously to depress British standards of living while inflating money wages and costs so as to cause an alternation between faster inflation and rising unemployment. It has taken the deepest post-war recession to enable managements in the private sector to win support from their employees, often over the heads of the trade union leaders, for the shedding of decades of slack working habits. It seems to me that this beneficial process would be assisted and, I think, extended into the public sector if this Bill went further in relieving trade union leaders of their self-destructive weaponry.

Lord McCarthy

My Lords, before the noble Lord sits down, I wonder whether he would answer this question. On the four examples that he gave of the differences between Germany and ourselves, would he not agree, on reflection, that they do not prove very much? The first one on strike ballots, is not a matter of law at all. The second one, on collective agreements—the law here is the same on collective agreements as it is in Germany. The third point, on the closed shop, proves the limits of the law because Germany has as many closed shops as we have. The fourth, on the public sector only shows how you need arbitration, because if you have arbitration you do not need a strike.

Lord Boyd-Carpenter

My Lords, what nonsense!

The Duke of Norfolk

My Lords, if, so to speak, I may speak, I hope not out of order, before the noble Lord sits down, may I also ask the noble Lord to confirm something which I know to be absolutely true—that the trade union system in Germany, which I have witnessed for 20 years in my service in Germany, was the child of Ernest Bevin?, He designed it; he made it; and he was proud of it. He said that when he had the power, as Foreign Minister, he was going to make quite certain that they had an up-to-date trade union system which, so to speak, he believed in and he wished that ours could have evolved into. That is what the German system was.

6.28 p.m.

Lord Plant

My Lords, a few days ago I revisited Tolpuddle. As I gazed at the TUC memorial cottages and visited the museum, I could not help wondering what the six Tolpuddle martyrs who fought oppression in 1834 would have thought of this Bill. What would they think of the statement of the noble Lord, Lord Cockfield, today that the trade unions are now too powerful and are engines of oppression, and that this Bill is needed to defend the liberties of the people? This Bill attempts to put back the clock of trade union progress by intimidation of strikers, attacks on union funds and attacks on union membership.

In 1875 the Property Act was a great step forward for trade unions, a few years after the formation of the Trades Union Congress. In 1903 the Amalgamated Society for Railway Servants had to hand over £23,000 in strike damages; but as there is no right to strike in the British constitution the Government in 1906 accepted the unions' need to be immune from certain common law torts. Since then the law has made it clear that there can be no legal action against the worker or trade union official who, in furtherance of a trade dispute, persuades other workers to break their employment contracts. This legal protection is an immunity, but some people, supporting this Bill, say it is a privilege.

After the General Strike there came the 1927 Trade Disputes and Trade Unions Act which, incidentally, made it illegal for civil servants to join with other trade unionists. It was not until 1945, when the Act was repealed, that civil servants were again able to affiliate to the TUC; and, indeed, to play a part within the International Labour Organisation. Walter Citrine and Ernest Bevin led the TUC more firmly to industrial democracy and consultation, and away from political activity. The country benefited greatly, during and after the war, by co-operation between Governments and the TUC.

The influence of trade unions grew, and in 1971 we had the Industrial Relations Act which resulted, among other clashes, in five dockers being freed from Pentonville gaol after the intervention of the Official Solicitor. The trade unions refused to register under the Bill and it floundered, because of the steadfast and united action of the trade union movement, and because of the unpredictable and damagingconsequences for industrial relations of a number of legal cases. Do not let us forget history; this Bill will go the same way.

The media and the Government—this has been underlined again today by the noble Lord, Lord Cockfield—have created misunderstandings and myths about the strength of trade unions, endeavouring to persuade the public that trade unions are above the law, that they are undemocratic and, perhaps most important, that it is the trade unions which must shoulder much responsibility for our industrial decline and inflation. I protest at this easy way out which some people seem to be taking. Trade unions are not solely to blame. What about management? I hold no brief for those trade unionists who want to create chaos on ideological grounds. Now is the time when we should be pulling together, as indeed are most productive enterprises. It seems that many employers and Government Ministers forget the experiences of 1971 to 1974, when large fines were imposed on unions carrying out basic trade union duties. Many employers saw the futility of legal straitjackets for trade unions. Some even paid the fines imposed by the Industrial Court.

The wheel has now turned a complete circle. This Bill is more subtle. There is no register or central issue by which the trade union movement can make the Bill unworkable, but the trade union movement will not have anything to do with divisive ballots. The Bill suggests to non-members that the Government are protecting them and that it is about freedom and liberty of the individual. It is nothing of the sort. When you have victimisation, bad management and rapacious employers, the workers can have freedom and liberty only under the protection of the trade union umbrella. The trade union movement, with its long years of history, knows that the British worker will not accept unjust restrictions. This Bill is not about improving industrial relations—quite the reverse. It is legislation to weaken unions, to tilt power and influence further from the working people.

I shall not go through the Bill clause by clause. The noble Lord the Minister has done that and, in doing so, gave us large doses of bromide. Other noble Lords have dealt with certain clauses in detail. I shall content myself with reflecting what I know to be the reaction of the average working person, who wants to see this country prosper, who wants his firm to prosper and who wants security and peace. These people say, first, that the Bill wants to smash trade union agreements about membership with employers—for example, the closed shop; secondly, that the Government want to see trade unions dragged into the courts to face penalties of up to £250,000; thirdly, that the Bill will make outlaws of people who give assistance to other workers who are in dispute—and here I might add that it may be unlawful for trade unions to give help to the International Transport Federation, in its campaign against cheap labour and poor conditions on flags of convenience ships; and, fourthly, that the Government wish to see sacked workers who refuse to be forced back to work until a dispute is fairly settled.

This Bill, which is a major and unacceptable attack on trade union rights, does not have the unanimous support of employers. The survival of trade unions as effective bodies which are able to defend and advance the interests of working people, is what is at stake. This mistake must, once again, be reversed by the ballot box. The trade unions will not wither away, but will be active long after this Bill has been forgotten as quite unnecessary.

6.36 p.m.

Lord Ferrier

My Lords, I rise, on the contrary, to support this Motion, because I feel so strongly that reform of our laws regarding trade unions is overdue and that this Bill provides the basis on which we can work. The fact is that the people as a whole are fed up with the way in which the trade unions are conducting their affairs today. There are far more folk who believe that we could do without the unions, than there are who think that we can do without the House of Lords. I myself support neither of those views. We cannot do without the trade unions, any more than we can do without our second Chamber. As my noble friend Lord De La Warr said, the trade unions are an important part of our body politic. However, the situation today is tragic, in that the conduct of the unions, buttressed as they are by the 19741egislation, is bringing the whole important movement into disrepute. It must be wounding to many noble Lords opposite that this is so, with the strikes in the health service and so on. I need not add to what the noble Lord, Lord Marsh, said in his slashing indictment of the trouble that we are in today.

A lifelong friend of mine—we have both devoted our working lives to industry and commerce, though in different parts of the world—with whom I had a good talk the other day used such well-chosen and trenchant words to me that I asked him to put the essence of them in writing. This is what he wrote: I spent 40 years in an enlightened company and watched the unions strangle the efforts of enlightened management to improve the lot of the workers. Contented workers were almost totally apathetic towards the evil influence of trade unions, and shop stewards were elected by a tiny, trouble-making minority who were the only ones to attend union meetings. Efforts by the employers to have elections for union officials take place in working hours were frustrated, so that the representation of the workforce as a whole could never reflect the views of the membership who were controlled by the minority of activists, through whom the management had to communicate with the payroll. That is a good illustration of some of the things that have been said this afternoon by, for example, the noble Lord, Lord Harris of High Cross.

This Bill goes far to redress the imbalance brought about by the 1974 legislation which, as my friend told me, put an end to his enlightened employers' efforts to pull together with a sensible workforce. I do not agree with the noble Lord who has just sat down that all trade unionists are opposed to the Bill. They are not. This Bill will be embellished in Committee. My friend suggested that the 1974 legislation put an end to his employer's efforts. I doubt whether they are at an end. Let us hope that the 1974 legislation was only a temporary interruption and that with this legislation a new era will begin.

As I say, the Bill will be embellished in Committee. Let us hope that it emerges as a real turning point in the country's industrial development. It will be a difficult task, probably rendered more difficult by the treatment which our proceedings in this place receive at the hands of the BBC and some of the media. It seems to me that "Auntie's" frantic and misdirected efforts to be even-handed, as she says, result only in a measure of censorship, because she does not like what some people say and she will not report what she does not like. So the reports are unbalanced.

Let us give the Bill a Second Reading and work on it at the Committee stage. As my noble friend Lord Boyd-Carpenter said, it is an important Bill. As our examination of it develops, it will be seen how weighty, how expert and how compassionate this deliberative Chamber can be. I appeal to "Auntie" to do her best to keep the listeners of this country properly advised of our proceedings.

6.42 p.m.

Lord Taylor of Mansfield

My Lords, unlike the noble Lord who introduced the Bill with his usual patience, clarity and deliberation, proclaiming clause by clause its virtues, I believe it to be a most unfortunate Bill in the sphere of industrial relations. I see this Bill as part of a process, on behalf of the Government, to change trade union law. Already there have been some parts of that process. Now we have got this—and the possibility of more to come.

It might be asked: How do we know this? It can be stated on the authority of the previous Secretary of State for Employment, Mr. Prior, who referred in 1979 to the Government's proposals in this field of trade union reform. It was to be a step-by-step process. How many bites of the cherry are there to be before the process is completed is anybody's guess. But what we do know is that this Bill is already the third instalment of the process to which I have referred.

May I turn for a moment to the beginning of this process. In 1979, only two months after they took office, the present Government introduced by statutory instrument, not by a Bill, an important change, extending from 26 to 52 weeks the necessary period for a person to be in employment before that employee could make a claim for unfair dismissal. Secondly, the required minimum period of consultation before employers could dismiss as redundant was reduced, if the number of their employees was between 10 and 99, from 60 to 30 days.

The reason I mention those two important changes is because the TUC estimated that above 1 million workers would be robbed of protection against unfair dismissal. To put it another way, the sack—losing your job, being deprived of employment by your employer, whether justified or not—is easier now than it was before the statutory instrument change to which I have referred. I suggest that this makes nonsense of what the Government professed and still profess about their concern for the rights of the individual. The other change reduced—this is very important—the period of meaningful consultation between employers and unions over ways of avoiding or mitigating the effects of redundancy on their members.

In 1980 there was the Bill which is fresh in our minds. In 1981 there was the Green Paper entitled, Trade Union Immunities. This Bill is the third piece of legislation within three years dealing with the process of changing trade union law. Whether this be the speed of the greyhound or of the tortoise is a matter for individual judgement, but my own thinking is this: too much and too quick.

Like its predecessor of 1980, this Bill is entitled Employment Bill. It is a misnomer. One would think that with such a title it would be about jobs, and about providing jobs, and that it would say something about the changing techniques in industry. I am certain that this would be the first reaction at first glance, of most people.

I do not know whether this is the time to mention an interesting dialogue between two unemployed men who were standing in the dole queue. It is said that before reaching the counter to append their signatures entitling them to benefit they were chatting about this Bill. They had plenty of time to do so before they reached the counter, for it was a long queue. Dole queues are long when there are 3 million unemployed. Some say there are 4 million. But whichever figure is correct, the queues are long. And not only are they long; they are curious. The people in the queues who have been deprived of their employment want to know certain things.

In the early days of February, not long after the publication of this Bill, one of the fellows said to his mate, and he was reasonably informed, "Have you heard or read of the news?" His mate replied, "What news?" His friend answered, "It is important. It is interesting. It might be beneficial to us. The Government have published a Bill entitled the Employment Bill". Bubbling over with curiosity, the one who had neither seen nor heard of the Bill and who was completely ignorant of its existence, commented with hope and optimism, "With a title like that, it is reasonable to assume that it will have some proposals about benefits and, more important, about jobs". But the other fellow said, "Nothing of the kind. At this stage I admit that my knowledge of the Bill is very limited and there hasn't been much information about it up to now—but I'm informed that it doesn't contain any proposals for benefits, jobs, or the changing techniques which you have mentioned ". There the dialogue ended. Then one man said to the other, "Cheerio, mate. I'll see you next signing day, when we shall be able to discuss more information about this particular Bill".

I want to join my noble friend Lord Plant in saying that the proposals in this Bill are impositions. They are not being negotiated between the Government and the TUC, representing the large body of working people in this country. May I now briefly mention some of the proposals in this Bill although I will not go into any great detail. First, there is the question of retrospective payments to those who it is alleged might have been unfairly dismissed between 1974 and 1980. There is the removal of immunities from a wide range of categories of industrial action. It may be seen that this is highly complicated from a legal point of view. In the next stages of the Bill, which are to follow this Second Reading, there is bound to be much discussion. Then there is the possibility of sequestration of union funds. As I understand it, under some circumstances it will be possible for employers to sue for damages for unlawful industrial action. This proposal envisages for the first time—except in the period between 1971 and 1974—that union funds will be at risk when employers claim that they are being hit by unlawful industrial action. My reply to that is, what a bonanza for the legal profession! It may create a bigger bonanza than that between 1906 and 1948, under the Workmen's Compensation Act. In addition, how divisive this will be in industry. In my view, it will be detrimental and poisonous to good industrial relations.

The size of the damages may be astronomical—up to a maximum of £250,000. If the action is successful, the amount is to be decided by the judiciary. The bigger the union in membership, the greater will be the fine. I will not proceed to give the difference between a union with a 5,000 membership and one which has a membership of 1,000 or more; I presume there will be an opportunity for that during the later stages of the Bill.

When I was looking at this proposal in the Bill, one factor occurred to me. The top figure of £250,000 is a slightly larger amount than that which was agreed upon between the NCB and the NUM for the dependants of those who lost their lives in the Cresswell disaster of 1951, when an action for negligence was taken by the National Union of Mineworkers against the employers, the NCB. This Bill is a highly controversial measure. There are deeply divided opinions about its proposals, and not all employers are 100 per cent. in favour.

A few weeks ago, the chief executive of the Co-operative Wholesale Society had an article published in the Guardian. It dealt with the many problems which this Bill raises, such as the closed shop and the sequestration of union funds. The CWS employs many thousands of people and has a turnover of £2 billion a year. On the question of whether the proposals are going to lead to an improvement in the climate for industrial relations in the nation at large, Mr. Landor said, I doubt it. In fact, the contrary may be the case. This Bill, like its predecessor, is a piece of legislative engineering—in my view and in the view of the trade union movement. It is an exhibition of the present Government's hostility to the trade union movement The verdict of the Trades Union Congress on this—and I quote from their document—is that, The cumulative effect of these provisions will be to severely restrict the actions of trade unionists. A wide range of traditional and hitherto accepted forms of union action will potentially be affected ". Last Saturday I had the privilege of attending a large demonstration organised by the Nottinghamshire area of the National Union of Mineworkers. There were bands and there were banners. The whole town was invaded by a concourse of people. One thing I noticed was the prominent condemnation of this Bill on some of the banners and in the passing of a resolution by a large crowd of people at the meeting. This Bill is sowing the seeds and the harvest in the future could be a whirlwind of discontent. What did Mr. Churchill say about one Bill which was introduced to the House of Commons? I will quote what he said: Take it away. Take it outside and cut its dirty throat ".

7 p.m.

Lord Renton

My Lords, although I disagreed with nearly everything that he said, it is an honour for me to follow the noble Lord, Lord Taylor of Mansfield. I shall always be grateful to him for his kindness to me many years ago when I was appointed a junior Minister and found myself responsible for health and safety in coal mines and many other matters. He and the noble Lord, Lord Blyton, were so very helpful and kind in teaching me a lot that I needed to know; I have always remembered that with gratitude.

My Lords, I welcome this Bill and I would like to congratulate my right honourable friend Mr. Tebbit on having introduced it. The noble Lord, Lord Taylor of Mansfield, will remember that when we had Labour Governments in power, several of them since the war, many of us felt sorry for them; we felt sorry for them because they had to contend with strikes which made it more difficult for them to govern, to control inflation and strengthen the economy. The decisions to strike were taken by union leaders who, rightly or wrongly, judged that it was in their members' interests to do so. But those who took the decisions had no responsibility to anyone except their own members, and they could and did ignore the interests of the Labour Government of the day and even of the industry concerned. It worried Labour Ministers, as the noble Lord, Lord Marsh, pointed out in such a telling way, but they could do nothing about it, because they could not afford to offend the unions on whom the Labour Party depended for their funds. That was why Mrs. Castle was prevented by a former Treasurer of the Labour Party from introducing a Bill based on her White Paper In Place of Strife. As Lord Marsh said, the trade unions had become more powerful than the Government of the day. May I say in passing that if all trade union leaders had been as responsible and wise as the noble Lord, Lord Taylor of Mansfield, there would be very much less need for this Bill.

The noble Lord, Lord Rochester, whom I see in his place, said that the Bill would not improve industrial relations, but I would ask him to think again about that. Indeed, I suggest that it will improve industrial relations, because, as was said in the Green Paper, in paragraph 12: The role of the law remains non-interventionist as it affects trade unions but it has clearly become more interventionist as it affects employers ". And it goes on to say: No obligations have been placed on the unions to use new procedures established by law or to adopt them as alternatives to industrial action. But many additional obligations have been placed on employers. Partly as a result of this there has been developed a widespread public feeling, not least among trade union members, that trade unions have too few obligations and too much power. So said the Green Paper; and surely this Bill, by making a better balance between unions and employers, should improve industrial relations and should be to the benefit of the nation.

There has been, and is, a crucial need to curb the power of the unions, and thank goodness! we now have a Conservative Secretary of State with enough determination to do so. The first 12 clauses, dealing with unfair dismissal and union membership requirements, are, in my opinion, clearly right in principle, although it has been pointed out to me that there is some doubt in the shipping world, where employment is so widely dispersed across the oceans of the world and where practical problems of communication arise, as to whether the ballot arrangements set out on pages 4 and 5 of the Bill are really workable. But this, of course, is a matter which we shall explore further in Committee.

While I am mentioning seafaring men, I hope it would not be inappropriate for me to pay tribute to the patriotism of merchant seamen, of dockyard workers, skilled shipwrights and others who responded at once to the chance to serve in or to help the task force. They are entitled to their share of credit in this day of triumph.

My Lords, I greatly welcome Clauses 13 to 16 on trade disputes; they contain various proposals which some of us put forward in the debate on the Green Paper last year. These changes are fundamental and long overdue, especially the new definition of "trade dispute" in Clause 16. It is, of course, quite ridiculous that third parties should be made to suffer the damaging effects of disputes between workers and workers, or those disputes occurring outside the United Kingdom in the outcome of which the workers concerned in this country are not affected. It is also ridiculous in my opinion that we should have mere protest strikes when there is no dispute at all between anyone, but when people are ordered by their politically-motivated union leaders to strike because they want to draw attention to their very often controversial opinions about something which has nothing to do with the employment of their members. That is a matter which I suggest we might also examine further in Committee.

I must confess one disappointment about an omission from the Bill. The Government have done nothing to rectify Section 17 of the 1980 Act, which deals with secondary action. This really is an awful blot on the statute book, both in substance and in form. Tempting though it is to try to change its substance, I do not propose to stir up that controversy on this Bill. I think it is arguable that we should give that provision a little longer to work itself out. But as to its form, the way in which it is drafted has been criticised in the courts as being tortuous, obscure and incomprehensible, and, greatly daring perhaps, I propose at Committee stage to move a redraft of that Section 17, drafted not by me but by a distinguished former member of the Parliamentary Counsel Office.

My noble friend Lord Boyd-Carpenter mentioned the need to protect the community by making it unlawful for people to withdraw or interfere with essential services. Of course, members of the police forces and of the armed forces are not allowed to strike—and I prefer the word "strike" to the euphemism "industrial action" which we generally hear these days. Surely it would not be unreasonable, nor difficult in my opinion—it should not be difficult if it is in the public interest—for it to become a condition of employment in the Civil Service, the fire services, electricity power stations, air traffic control, gas, water and sewerage undertakings, and people who work in hospitals, that they will not strike. In my opinion, they would not lose by that but they might gain; they would certainly gain because they would have greater sympathy from the community.

On this point I very much doubt whether legislation is needed, because certainly all new entrants could be asked to accept such a condition, and I feel quite sure that there are many people employed in those services already who would voluntarily accept such a condition. Indeed, we know that in the Civil Service strike there were many who refused to strike at all and others who struck only out of—I regret to have to say—a misguided sense of solidarity. I hope that the Government in future, even if it is not dealt with in this Bill, give serious attention to this matter and to the speech made by my noble friend Lord Boyd-Carpenter. Striking is a pretty crude, uncivilised way to behave anyway. The strange thing is that it often damages the interests of the strikers as much as anybody else.

In my view, for the time being, the Government have the question of immunities about right and I would like to congratulate them on that. However, I was very glad that we were told by my noble friend Lord Cockfield in opening the debate that this Bill is just another step, and not the final one, in the step-by-step approach. It would be a failure on our part if we were now to close the book on the subject of trade union reform, and I was thankful to hear that it is not intended to do so.

7.11 p.m.

Lord Howie of Troon

My Lords, when this Bill was first proposed some while ago and then published, I must say that I was strongly attracted to it and felt that I ought to support it in general terms at least, if not in total detail. Since then, two impediments have been put in the way of my support. The first is the attitude of the Secretary of State for Employment in the course of the Committee stage and Report stage of the Bill that passed through another place. Mr. Tebbit, as I read him, seemed to me to reassure his colleagues in another place that the Bill was not intended to destroy or to bankrupt the trade unions. That reassurance was welcome, but it was fairly plain from the tone of Mr. Tebbit's remarks that he rather wished that it was, and that seemed to me to stand in the way of my keen support for the Bill.

The other impediment was the speech made by the Secretary of State for Trade in introducing the Bill this afternoon. It was, as we might expect from a man of his formidable intelligence, a very clear exposition of what he saw as the merits of the Bill, and for the clarity of his speech we are, of course, deeply grateful. However, I thought that the speech introducing the Bill was far too apocalyptic in tone. The noble Lord assured us that the Bill was a modest one—and I must say that I agree with him—but at the same time he thought that it was vital. I did not know that he quite went so far as to say that it was vital to the fate and the future of civilisation as we know it, but I am sure that he would have done so if he had thought of it.

It is not a vital Bill. In no way is it a vital Bill. If the Bill passes both Houses and becomes an Act, and if it is implemented, and if it works, it will improve our condition a little bit—marginally. If the Bill passes and is implemented and does not work, it will not make very much difference either—things will go on much the same as at present. Therefore, I am saying that if this measure works, it will improve the situation a little bit, but not a lot.

The apocalypse I do not think really comes into it at all, and the tone of the Minister seemed to suggest to me quite the wrong approach to take for a measure of this kind. If the Government really wish to force the Bill through both Houses and to force it into action, then that type of speech was perhaps the right one to do it. But it is the type of speech which might turn out to be resented by the people whose assent is necessary in order to make this modest Bill work when it becomes an Act.

It will not have passed unnoticed that the proposers of the Bill have managed to irritate my noble friends Lord Taylor of Mansfield, who sits in front of me, and Lord Plant who spoke from beside me not so long ago. That is something about which the Government should think quite seriously. These are men with a lifetime of experience in the trade union movement and who in their personalities and characters embody just about every thing that is best in trade unionism as we know it in this country. They are not men easy to irritate, but having irritated them, the Government should think carefully about what they have said and consider whether perhaps there is a way to mollify them and so make their modest measure work.

There is one other thing which I think the Government might do if they wish to gain for this measure the kind of assent which is necessary to make it work, and that is to recall the passage through this House of the 1980 Act which was the first instalment, presumably, in the step-by-step approach which we heard about a moment ago and which was handled with tact and charm by the noble Earl, Lord Gowrie. If I were to be so impertinent as to advise the Government, I would say to them: bring back Lord Gowrie and do some good to this little measure. They will certainly gain more adherence for the Bill through his agency than through the kind of speech which we heard earlier this afternoon. So my support for the idea of the Bill has been slightly doused by those two experiences.

Luckily the balance was restored by the speech of my noble friend Lord McCarthy on the Front Bench, who drove me back towards supporting the Bill by the excitable violence of his attack upon it. I was in strong agreement with much of his speech, and that was because much of his speech was not about the Bill at all. Those parts of his speech which were an attack on the Government's general policies were accurate, incisive and entirely to be supported on at any rate this side of the House. When he came to the Bill, I thought that he skated over it fairly rapidly and tried to make the most of his attack upon it.

I think that my noble friend—and I am not trying to be impertinent to him, as I am sure he will realise—should tomorrow study the speech made by our former noble friend—or perhaps I should say our noble former friend—Lord Marsh. He need not agree with everything in Lord Marsh's speech—nor need I—but at all events it is a speech which ought to be studied and con- sidered and which has in it a good deal of food for thought in matters of this kind.

Therefore, I think that the Bill is a modest one. It will not solve all of our problems. It might begin to solve some of them, and in general terms I think that it ought to be supported. But as regards the detail, it needs to be very carefully considered in Committee. It certainly should not pass into law as an Act unamended, unchanged.

Let me merely mention in passing some areas where I think changes would improve the Bill. The Government are probably right in changing the law on immunities enjoyed by trade unions. But, at the same time, I think that the Government should think very carefully about the size of the penalties which might be inflicted upon unions. I think that it is correct to insist that unions should be liable to damages in some cases but that these damages should not be punitive; nor should they be of such a magnitude that they might endanger the viability of any union. I agree with the Government that the immunities ought to be changed but I think that the figures proposed by the Government arc too high and I hope that in Committee they will be reduced.

I should like to say a few words about the closed shop. I do not like the closed shop because I believe in volunteers, and I do not think that most of the time the closed shop is needed. Usually, when you are in a position as a unionist to win a closed shop, it is because you have enough members already to make the closed shop irrelevant. There may be metaphysical reasons for having them, but I do not think that they need detain us very long. I think it is right that these closed shops—even the existing ones or, at any rate, some of them should be subject to ballot. That is only right and fair.

But there are two thoughts which I think the Government should bear in mind very carefully as the Bill proceeds through the House in Committee and on Report. Is it absolutely necessary that the ballots should be quite so often, as the Government seem to be suggesting? Ballots? —Yes; certainly repeated, but not that often—not every year, not every seven years, but perhaps every 10 years. Let us think about the time-scale there, and also about the size of the majorities for which the Government are asking in these ballots. To me the majorities suggested by the Government are literally absurd. I can appreciate that there is an argument for demanding that a majority of the total electorate, as it were, should be in favour of a change of this nature. But let us not forget what happened when we held a referendum in this country to go into the Common Market, and I do not argue here about the virtues of the Common Market. We did not have any fancy franchise; 50 per cent. of those voting was thought to be enough. That was quite reasonable.

When we came to the referendum on Scotland and Wales, although 50 per cent. was not by then thought to be quite enough, the margin was only 40 per cent. of the electorate. That is a great deal less for these quite momentous matters than the kind of majorities which the Government require under the Bill. The majorities are far too high and the Government should certainly reduce them.

I should like to raise again a point which I raised during the passage of the 1980 Act, and I shall try to be brief. As some noble Lords may recall, it was the problem which professional engineers and other professional men who are members of learned societies and professional institutions face if they are also trade unionists in the possibly conflicting obligations which they have as professional men to their code of professional practice, especially in relation to matters of health and safety, and the contrasting obligations which, as trade unionists, they may well have to the union. These matters are not always the same. Some unions go so far as to make allowances in the rules or to negotiate provisions in closed shop agreements which allow professional engineers and other professional men to place their obligations as professionals before their obligations as trade unionists. I think that that is right because, as a professional, the engineer or other owes an obligation to society as a whole in carrying out his activities. As a trade unionist, he owes an obligation only to a section, and I am certain that this obligation to the whole of society should override his sectional obligation to his union. No doubt we shall return to this during Committee.

There is one other point which I wish to make and I hope it will be the last. I support the Government in their intention to outlaw the union-only contract, one with which I am quite familiar as a civil engineer in the construction industry. It is not needed. The reason that the union-only contract is not needed is that many or most contracts—certainly almost all contracts with which I was involved in the public area—contain a clause based on the Fair Wages Resolution 1947, which was passed by Parliament so long ago. That Fair Wages Resolution provides all the protection in the way of wages and conditions which are necessary in the construction industry and there is no need at all to superimpose upon it a device which is intended less to protect the employees than to recruit members of trade unions.

I very much enjoyed the passage of the 1980 Act through this House, if only because of the extraordinary analysis of trade unionism and trade union law provided by my noble friends on the Front Bench, Lord McCarthy and Lord Wedderburn. I found myself in disagreement with them from time to time and in agreement with them occasionally, but Y never yielded in my admiration for the excellence of their dissertation. I look forward in the course of this Bill to volume 2 of the collected works of McCarthy and Wedderburn on trade union law. I promise them that I shall try to support them in their attack on the Bill as often as I can, but I would make one plea. Will they ask me and my colleagues on the Benches here to attack the Bill only when it is wrong, not when it is right?

7.27 p.m.

Lord Mottistone

My Lords, it is a great pleasure to follow the noble Lord, Lord Howie of Troon. Much of what I have to say is very similar to what he has said. On those closing remarks, I am not sure that we want a re-run of that great exposition that the noble Lord, Lord Wedderburn, and his colleague gave us before. Still, we shall have to wait and see. On one point I disagree with the noble Lord, Lord Howie. I thought that the introduction by my noble friend the Secretary of State for Trade was simply first-class, not only giving a clear exposition of what the Bill is about, but also reminding us of the basic history. As he spoke I was thinking that perhaps 1906 was a rather special time in this country's life because I have read in many places that that was when our competitiveness in the world really started to decline.

There have been many splendid speeches, but I cannot resist mentioning the speech of my noble friend Lord Boyd-Carpenter. I thought that that was a wonderful leader for the rest of us Back-Benchers, and I thank him for it. There was one point he made, which my noble friend Lord Renton also made, which struck a very special chord, and that was the questioning of the right to strike of public services. The only time in my life that I have ever had time to think was when I had the privilege of commanding a ship in the Far East in the late 1950s. I followed what was going on in this country at the time. I was not all that busy; there were no Falklands or other issues around to keep one occupied. One thing that struck me, which would be a clue to getting this country off its bottom, on which it was even then, in the late 1950s, was that there should be a sense of public obligation by persons employed in public services which is akin to that of those in the fighting services of the country, and that in particular they should somehow sacrifice the right to strike for some sorts of undertaking to make sure that this was fair. I am delighted to hear this raised in your Lordships' House some 25 years later. I hope that somehow my noble friend Lord Ferrers may take to heart what my other noble friends have said and see whether, as time progresses, the Government cannot work towards the persuasion and the bargaining, if you like, to produce that sort of result. I am sure it is one of the fundamentals.

I hope not to detain your Lordships long. I am advised in the main by the CBI and in that respect, and indeed personally, I strongly support the general principles of the Bill, especially that of the provision of more safeguards for the individual against any abuse of trade union power, and the provision of what I believe to be a more balanced framework of industrial relations. I also welcome this as a continuation of the step by step approach initiated by my right honourable friend Mr. Prior at the time of the introduction of the 1980 Act.

There is no longer any justification for trade unions' general immunity in tort. They should in their corporate capacity be liable in the same way as individuals for their actions in contemplation or furtherance of a trade dispute, and the key is responsibility for your actions. The only way this country can prosper is by people being responsible for their actions. This applies to the youngest boy starting out in the world, whose responsibilities he has to be taught, and it really should apply to all bodies corporate of whatever sort. This surely is a key to successful existence.

I welcome also the provisions for rendering void union labour only clauses, and for extending protection against unfair dismissal without compensation for employees covered by existing closed shop agreements. I shall not pursue the argument of the closed shop at this stage. We shall have ample opportunity to do that when we come to the Committee stage.

There is one point which is important and which is not within the Bill; that is, that important though this next step of the step by step process is, there is a real need for more voluntary improvements in industrial relations, especially in the area of improved communication and of more involvement of employees. Only with parallel voluntary improvements of that nature coupled now, I like to think, with the newfound ability of managers to manage, can British industry recover its competitiveness in the world markets. That must be the basis of our aim. We ought to have an underlying thought on all legislation, but particularly that which relates to industrial relations, that it is competitiveness in the world market which is vital to this country. Really, our personal needs and wishes must be subordinated to that main issue.

In conclusion—and here I particularly match what the noble Lord, Lord Howie of Troon, said—as one employer has advised me, the effect of these carefully thought out legal sanctions is not that they will be used. No employers like to use the law if they can avoid it. My noble friend Lord De La Warr made that point too. The real value of this Bill is in providing an updated background against which the current improvements in industrial relations in individual companies can be further developed.

7.35 p.m.

Lord Houghton of Sowerby

My Lords, I am glad to be able to speak at this stage in the debate because what I have to say will probably be better understood in the light of the speeches which noble Lords have already heard from both sides of the House, and particularly some of them from this side of the House. The speech of the noble Lord, Lord Marsh, was in a class by itself, and appropriately made from a central position in your Lordships' House. He made his name in another place by making that sort of speech against the Tories. Of course, it went down very well on our Benches, so that we all get this kind of entertainment in turn. He is very impartial now in granting his political favours.

I shall not go into detail about the Bill because I want to try to bring a parliamentary and political perspective to it. We shall have a long and probably barren and unrewarding Committee stage on this Bill. We shall be guided through it by my noble friends Lord McCarthy and Lord Wedderburn, who we affectionately know as our visiting professors. We shall try to understand what they are urging us to do. I do not suppose I shall agree with them all the time. I am intrigued to know what is the agricultural role of the noble Earl, Lord Ferrers, in this debate; whether he is going to be a shepherd or a cattle drover. I shall look forward to his speech at the end of the day.

My noble friend Lord Howie of Troon referred to the sepulchral tones in which the noble Lord, Lord Cock-field, introduced this Bill. He made a sonorous opening speech, rather like a minister abolishing slavery, or impeaching the monarch, or making trade union meetings unlawful assemblies, but I wonder whether the noble Lord realised that it is probable— I say probable—that this Bill is another example of the issues which no Government and no Parliament appear to be able to settle except after a painful, wasteful and frustrating exercise in the political and parliamentary seesaw.

Other recent examples of the inability of our politics and Parliament to reach stable conclusions were, first, the steel industry, which was nationalised, denationalised, and renationalised. It took three Governments and three Parliaments to do it, and now look where we are. The noble Lord, Lord Marsh, made one of his most notable speeches in another place in favour of nationalising the steel industry. Then he went to a nationalised industry, and has been complaining about his experiences when he got there.

Then we remember and certainly the noble Lord, Lord Boyd-Carpenter, will remember—the National Insurance Scheme. That took four Governments and four Parliaments to finalise after 14 years of uncertainty about the future of our National Insurance Scheme. Bear in mind that throughout these periods the shifts of political fortune and the movements of the seesaw reflected only marginal change in public opinion.

Lord Boyd-Carpenter

My Lords, will the noble Lord allow me to intervene? Is it not the fact that the state of affairs which he summarised has in fact resulted in our now having one of the best systems of social security in the world?

Lord Houghton of Sowerby

My Lords, I rather think that it could have been reached in a shorter period than 14 years, over four Parliaments and four Governments. The applied knowledge and ability of all concerned could have produced a conclusion rather sooner than that, had it not been for the marginal swing of the political pendulum. I believe it is our electoral system which is at the root of some of this trouble, because it can bring about radical changes at Westminster and in political power on remarkably small movements in electoral opinion. That produces a distortion of our political and parliamentary system. Nearly all Governments are minority Governments and have more people against them than for them, and in most cases the mandate is false, yet it is freely used and is being almost sanctified now in our party political affairs.

Now we have a Bill whose forerunners have either been killed or wounded, and I will quickly take your Lordships through the record. What happened to the Trade Disputes and Trade Unions Act 1927, fathered by no less a person than Sir Winston Churchill in the heyday of a Conservative Government? It was repealed. What happened to the Labour Government's bold proposals in the White Paper bearing the alluring title In Place of Strife in 1969? It was dropped. What happened to the Conservative Industrial Relations Act 1971, said to have been largely the work of the present Chancellor of the Exchequer? It was repealed. What has happened to the last Labour Government's second attempt, in 1974 and 1976, to meet the demands of the trade unions by repealing the 1971 Act and giving them more of what they wanted? It is now being reversed—in the 1980 Act and in this measure—in some important and fundamental respects, we hear from the Benches opposite. What we have is called a step-by-step approach, one in 1980 and one now, and this is the next candidate for repeal.

That is obvious from the speeches. They are not the speeches of noble Lords who want to amend the Bill, but of noble Lords who want to repeal it, if it becomes an Act, and they are not the spokesmen of the Socialist Workers' Revolutionary Party or Militant Tendency. They are sage counsellors in your Lordship's House, some of them with vast experience, most of them ageing, full of wisdom, all passion spent; yet they are saying that the Bill should be rejected, and in due course they will be urging that it should be repealed. Only a small swing of the pendulum will wipe the slate clean again and take us right back to 1906, where apparently many trade unions wish to be and wish to stay.

With such a record behind us, the warning is surely clear; namely, that anti-union legislation does more harm to Governments of both parties than it does to the unions. One need only think about it. I am surprised that the present Government have thought of no better strategy than to bang their heads against a brick wall again. I am not surprised the trade unions are crying before they are hurt. Having been in the movement for many years, I know how quickly we sense danger. Nevertheless, those advertisement copywriters who tell us that the Tory Government are out to crush the unions do not know their history. In this repeat performance of The Comedy of Errors one might ask who is out to crush whom, and I would hazard the opinion that Mr. Len Murray will be where he is for quite a time after Mr. Tebbit has, politically speaking, departed hence.

The root problem is that Conservative Governments in recent years have broken off the dialogue they used to have with the unions. There is no longer a meeting of minds, with the will to work for agreement. Nobody listens to anybody else. Arthur Deakin used to say in my time on the General Council of the TUC, when we were reviewing the agenda of the conference and examining closely what the motions were saying, "I don't care a damn what the motion says. I want to know who will be moving it", and that is the attitude of the trade union movement to the Conservative Party and Conservative Governments. It is not so much what the Bill says as the fact that they are moving it; they are suspect from the start. I cannot understand why the Government go doggedly on with too little effort to get off the seasaw and get on firmer ground. All they are doing is to drive the Labour Party even more closely into the arms of the TUC. The noble Lord, Lord Marsh, said the trade unions owned the Labour Party. The trade unions have not yet paid all the debts of the Labour Party.

If, as seems likely today, there is no answer to be found to the problem before us that will hold good for more than one Parliament, or possibly two at the outside, what stability shall we get in our industrial relations and our civil rights and the rule of law for as far ahead as we can see? Why do the Government not realise the danger of what we are doing and try to meet it? For that matter, why does not the TUC? They have a responsibility too. They must be as aware as the rest of us of the futility of the parliamentary process which is producing this kind of result. What sign of constructive and bold leadership have we on the trade union side at this time? Not enough. Are they just waiting for the next Labour Government to do what they did before; repeal it all and wipe the slate clear again? We need a new initiative to save the repute of Parliament and of the trade union movement.

Apart from anything else, the timing of the Bill is most unfortunate. This is no time to have a guerrilla war with the unions. We have come through the recent ordeal of the Falklands crises with a united people, and the aftermath will tax our resources and strenghth and I think that a further test of our unity may still be to come. The eyes of the world will be upon us, and critical eyes some of them will be. Yet at this time, we are choosing to widen gaps and create fresh rifts in our internal affairs while the rest of the world is looking on and telling us what to do next. We should have a truce, and the noble Earl, Lord De La Warr, repeated his attitude towards that. It is probably too much to ask the Government to drop the Bill altogether, although there is a precedent, a Labour one, for that. There is also a precedent for putting a Bill on the statute book but deferring its operation, all or part of it, while other problems more pressing and more dangerous receive attention. That was a Labour precedent too.

I urge the Government to pause before going along the road of just inviting bitterness, violence and the stirring up of undesirable elements all over the country, getting nothing settled at the end of it. Let us improve the Bill in Committee if we can, send it forward, pay out the compensation in the earlier clauses for past grievances—I have every sympathy with those who will benefit—and leave much of the Bill to be brought to life only by resolution of both Houses of Parliament at a more suitable time than now to review the matter. Better still, leave it until after the general election; let the people have a say.

Another point is that time may work in our favour towards better understanding and greater unity. Such a pause might bring that about, especially if meanwhile we give fresh attention, as we should soon, to the old problem, never solved, of industrial democracy. The EEC directive is on its way and we should be studying that. We have all forgotten Bullock, or cast it into the wastepaper basket—it has gone dead on us—hut it is a vital part of our industrial relations. We spend too much time on the law of industrial conflict, and that is bad for us. We do not run our trade union movement and industrial relations always on conflict, yet the confrontation side of it all gets an exaggerated part in the whole pattern of trade union and industrial relations.

I also believe that changing the law probably makes very little difference, anyway. I cannot understand the trade union fear of being weakened. Trade unions do not seem to have been weakened by anything yet. What they did not like, they have got rid of, or what stays that they do not like they ignore, defy, or make unworkable. Where is the weakening? In any case, if they want real strength, bona fide strength, in society today, they can get it any time that they like to be more constructive about the role of the unions in our changing society. But, of course, the Government must offer some encouragement; they should hold out a hand. We ought to be looking at the whole question of participation, instead of setting the stage for more litigation between reluctant employers and militant unions, only to send more lawyers' sons to Eton.

The Bill contains what might be taken as a code of conduct. We should hold it in abeyance for a while and see how it would work. Meanwhile, what about industrial democracy and all that? That is what my message is about; I cannot think of anything better. All I know is that. this is not the way to go about it. What, then, is the alternative? It must not be to wait and have another movement of the seesaw. I hope that the Government will really consider their position.

It seems to me that the alternative is chaos or the coercion of a fully collectivised economy and society. Incidentally, I hope that the trade unions are working out how they would stand with a Militant Tendency Government, and what freedom they would have. But as of now the spectacle of trade unions preparing for war, for a campaign of defiance and objection to the Bill, is the measure of the failure of our parliamentary system. There is a splendid opportunity today. This is the very day when the Government could take a fresh look at the whole of our affairs and see how we are going into the future, whether we shall still be in acrimony, conflict, and disagreement, or whether we shall have a new spirit which will take the country on into the difficulties of tomorrow. There are some elements in the trade union movement that are just waiting for the opportunity of defiance and violence, and that would be a very bad thing indeed.

I believe that the Government now have the strength, from today, to make a gesture. I ask them to stop this rake's progress, because it will not get us anywhere, it will not settle anything. The Prime Minister is now surely in a position of great strength and prestige to end this miserable parliamentary stalemate. That is the best message that I can give. I think that it offers the best hope in the present situation; otherwise we shall go on with our parliamentary procedures, meaning little, achieving nothing, with the trade unions just where they are, and the conflict going on. Where do we end? This is not the way to run a country. I ask the Government to look again at where they are going, where they are taking us, and see whether we cannot come to some accommodation and form the basis for mutual understanding and agreement which will last at least for the next four or five years.

7.54 p.m.

Baroness Burton of Coventry

My Lords, I want to take rather a different approach and, since I am the twentieth speaker on the list, that might be a relief to the House. Probably like other noble Lords, in considering whether I should speak tonight I wondered whether I had anything to say that would interest the House, and I hope that as my approach is a different one, your Lordships will bear with me. I want to talk about some of the things that were mentioned by the noble Lord, Lord Boyd-Carpenter, and my noble friend Lord Aylestone, and if those two noble Lords think that they form an odd mixture, perhaps they will see what I am getting at as I move on. I should like also to take up some points that were made by the noble Lord, Lord Houghton of Sowerby, who it is always a joy to hear, and from whom we can always derive pearls of wisdom and real knowledge of these particular problems.

I wanted to speak this evening because I feel quite strongly about the subject as I am sure do a number of your Lordships, and I believe that if one feels strongly about the subject, as I am sure do a number days certainly one of my complaints, and I think a complaint of many other people, is that too much goes by default. I want to talk tonight about the war on the home front, while looking at the general attitude towards the Bill that we are discussing. It seems to me to be of vital importance to industrial relations and industrial democracy that we look at the attitude towards legislation such as this which is felt by both the general public and the trade unions.

There is little to cheer about if one looks at the war on the home front. The action today of the health service unions brings back memories of our winter of discontent. It was more than three years ago, on 25th January 1979, that we had a debate in this House on the winter of discontent and the resultant industrial situation. I tried then— and I want to try again tonight—to explain how I saw the background to the situation and how I thought the general public saw it. First of all—and it distresses me as much as anything I feel exactly the same today as I felt in 1978 and 1979. How could one feel any different? Services are deteriorating, and patients are suffering. Non- urgent cases are turned away, really meaning that sick people, anxious and in pain, have to wait longer for the treatment that they need.

What do the public feel about all of this, three years on? I believe that the public while having little sympathy for many of those supporting them, is on the side of the nurses and would welcome their being made a special case. I am quite sure that everyone in this House, and outside, will hope that the efforts of Mr. Pat Lowry will be successful. But I am also sure that no nurse, however strongly she may feeel, can read without regret the remarks of a would-be patient who was denied admission to hospital because she was not regarded as an emergency. She said: Pain, even severe pain, is not regarded as an emergency on its own. You don't die of pain ". This patient cannot sit still for longer than a minute. The only time that the pain ebbs is when she is lying flat. However just the cause, I think that action of this kind is callous and wicked, and I believe that the nursing profession deep down in its heart would agree.

The background does not seem to change. Today we have a Conservative Government; last time we had a Labour Government. But the attitude of the unions seems to be the same towards both. This forces many people to believe what I, too, believe, namely; that this type of action will continue, whatever Government are in power. Various sections of the community still say, before any negotiations commence, Give us what we demand, or we shall take industrial action ". That is what was said in 1978, and it is what is said today, in 1982. I am not here referring to the nurses or the ancillary workers, but to unions supporting them largely because they see a chance of using public sympathy as an additional weapon in their battle against this Bill. Any suggestion that increases in pay should be linked with productivity is always shouted down as being "anti-union", certainly by those unions having the strongest clout, as we would say. And so it goes on.

It does not seem to matter whether or not the demand is justified; it does not seem to matter whether or not the money is there; it does not seem to matter whether or not the industry or the service is brought to its knees; it does not even matter who is hurt. The cry is, "Confrontation!" and, "Give us the money!"; and the cry is the same whatever Government are in power. So at times I feel, and I think the ordinary general public outside Westminster feels, despair—despair at what has happened to our country on the home front; and that is in remarkable contrast to what has happened overseas during the past few weeks. I know that many people taking industrial action have a grievance, and I know that many are justified. But, equally, I know that many are not justified. So do the people outside, and so do many in the trade unions.

Our attitude towards opinion polls probably varies according to what those polls indicate, but I think it is evident from many nowadays that a good many trade union members feel that their voices are not heard sufficiently. Many are worried at the way they think their union is going. We have seen at more and more meetings and at more and more gatherings on television how more and more members of the unions are standing up and protesting. I hope that enough of them will join together to curb (if that be not too emotive a word) the wrong application of union power.

Not only we but many outside are asking the same questions today as we are all asking. Why should unions be above the law? Why should anyone be above the law? Why should it, and why must it, always be spoken of as a confrontation if efforts are made to change this position? I would ask the House: can anything justify inflicting hardship on the sick? We had enough of that in the winter of discontent. And who is going to decide what is an emergency and what is a non-emergency—the picket lines? Others besides myself probably read the other day of the case where a Liverpool surgeon had to negotiate with a shop steward about which of his patients the shop steward thought qualified for emergency treatment.

I want to suggest that we cannot go on like this, however unfair pay rates may be. If financial sacrifices are demanded of the community, surely there is no reason why any section should be exempt. If anyone said to me, "But surely you will agree that some of the pay or salary increases recently have been much too high", I would say, "Yes", and I think some of them have been most unwise; but a war on the home front is not a way to deal with the problem, not at the expense of the sick. I do not think anything justifies that.

I was looking at the leader in the Guardian of 20th May. It said (and I quote): Yesterday's strikes hurt. That was why they were called ". Speaking of the Government and the TUC, this leader concluded: Fundamentally, neither side will admit that there could be a better way; that binding arbitration or a guaranteed place in the earnings league in return for a no-strike pledge would be better than spasmodic dust-ups. Above all, neither side will yet admit that a voluntary incomes policy, at least in the public sector, makes more sense than picket lines outside disrupted hospitals ". It seems to me that this is something that we at Westminster, and in both Houses, cannot dodge. I think this is the responsibility of Parliament. As I see it, Parliament has the responsibility of passing what seems to be fair and responsible law with the requisite approval and support of the public. If enough of the public do not approve of the legislation, they have a remedy at the next general election.

If we go back to 1979 and to the debate on the industrial situation held in another place on 16th January, Mr. James Callaghan spoke of the, indefensible hardship [that] can be imposed on innocent people who are not connected with the dispute ". He was referring to secondary picketing, and at column 1546 he said: It is not designed to stop the blackleg from doing the job of the man on strike. It is intended to stop another worker from doing the job that he usually does. That is the distinction that I make as an ordinary citizen and not as a lawyer Tonight, I am trying to add my voice on behalf of those innocent people who have not the slightest connection with the dispute concerned.

The Prime Minister went on to say, as reported at column 1547 of the Official Report: I begin by asserting two fundamental principles of our society. First, we cannot deny the right of men and women to withdraw their labour and still call ourselves a free society. That to me is fundamental. The second principle that I assert is that the community has an overriding right against all sectional interests. These principles must be reconciled. This is the difficulty of a modern society ". I think we would all agree that that is indeed the difficulty of a modern society. We are not a dictatorship, and if any section of the community refuses to obey or to abide by the laws of our country, then we can only hope that public condemnation will bring wiser counsels. A large proportion of people believe that unions, as well as everyone else, should obey the law. Ten years ago an Opinion Research Poll found that 76 per cent. of union members believed that the unions should obey the law. It would be interesting to know what that percentage is today.

I believe and venture to suggest that Parliament should say that it is not prepared to go on like this, and I hope I am adding my voice to many others. People do not want to know who is to blame; which party said this and which party said that, or even which section of a party said something else. They have had enough of bickering on television and on radio, and I wonder when politicians and the unions will realise this.

I should like to ask—and I have been asking for many years: why should people's holidays be ruined time and again because of industrial action? Why should railway commuters pay incredibly high sums for their season tickets and find no transport available? Why should ratepayers not have their dustbins cleared? Above all—and I come back to it: why should the sick have their worry made even worse? No, my Lords, let us be done with this once and for all. I do not care who is to blame; I only know that it cannot go on. I am hoping very much indeed that trade union leaders will not carry their campaign against this Bill to the point of defying the law itself. This trade union problem has been with us for many years, and it will take a great deal of wisdom from all sides to defuse it.

In spite of what I have been saying, and although admiration may wear a little thin at times, I believe the public does appreciate what the trade unions have done and the benefits they have brought both to this country and to their own members. The public also appreciates that many members, and some leaders, would like to see changes and that this presents problems. But, of course, the public has problems too. I wonder if the trade union leaders realise that when some of their extremist colleagues, leaders of unions themselves, talk about defending their basic freedoms and democracy, the public believes that it too has basic freedoms and a right to what it sees as democracy. Sometimes I think that this seems to be overlooked.

I think the British public is fair, I think it would support the unions if it felt that clauses in this Bill were an effort to deprive the unions of legitimate power. But I am quite sure that it would not support industrial action (and I quote): to defy Tebbit's law and defend our movement ". I suggest that the public needs defending too.

In conclusion I would hope that those moderate trade union leaders and members will stand up to be counted. We all know that we could not do without trade unions and I hope that they could only grow stronger with public support. But it does not sound convincing, and it is not even a good battle cry, to shout "Confrontation!" when Government, irrespective of party, dare to suggest that nobody is above the law. I do not agree with everything in this Bill any more than many who have spoken tonight, but 1 shall support the Government, and if there were a vote tonight I should support the Government, because I think it is time that somebody said, "Enough !"

8.13 p.m.

Lord Campbell of Alloway

My Lords, at the outset may I have leave to apologise to your Lordships, and in particular to my noble friend the Minister, for not having been able to be present when this debate was opened. It is a singular pleasure and privilege to follow the noble Baroness, Lady Burton of Coventry, in particular because I happen to wish to associate myself with everything that she has said and, for reasons not only given by the noble Baroness but given by so many of your Lordships, I suggest taking the homely phrase that has been coined that this Bill provides a useful, essential and timely contribution on the home front.

In this context, however, I wonder whether any of your Lordships might happen to share my particular and personal concern as to matters connected with the order of industrial relations envisaged by this Bill which finds no place in the Bill. At the outset, I would refer to the problem of contracting-out, stigmatised by the noble and learned Lord, Lord Shawcross, when he was the Labour Attorney-General, as "collecting political funds by human inertia". It was, as your Lordships will remember, introduced by the Liberal Government in 1913 and the Conservative amendment as to contracting-in, introduced by Lord Wolmer at the Report stage, was opposed by the then Attorney-General, Sir Rufus Isaacs, and it has been "contracting-out" ever since.

I earnestly suggest for your Lordships' consideration that today, with the political realignment that exists, the members of trade unions should really have the free right to deal with the question of their political contributions to funds without any bias on the bowl, bearing in mind that the Act of 1913 (which was introduced by the Liberal Government) was introduced to repeal the effect of the decision in the Osbourne case. But that is neither here nor there. What the Osbourne case decided, by and large, was that it was unlawful for trade unions to collect money for political purposes or to raise levies for sending representatives to Parliament. Today, it is a non-question. That issue, the Osbourne issue, is in no way related to the contracting-in, contracting-out issue.

The second matter that causes me, and may cause your Lordships, some concern is the problem that this Bill takes out of the area of immunity the inter-union dispute. This, as your Lordships know, is done by the amendment in Clause 16 which affects the construction of Section 29 of the Act of 1974. It really is, in submission, important that there should be machinery for the settlement of inter-union disputes, and today there is none.

The third matter that causes, in submission, some concern is where you get the situation that both the employer and the union wish to operate the closed shop —take, for example, Equity—and there is no real reason why they should not, there is no machinery or means by which a derogation can be given. The further matter, perhaps, of concern not included in this Bill is that there is no statutory provision or guidance as to the measure of appropriate consultation between officials of the trade unions and the rank-and-file members before instigating industrial action either at plant level, national level or by way of sympathetic action.

This, your Lordships may think, is a defect; and in deference to my noble friend Lord Renton—who, alas! is not here—I use "industrial action" because strike action is only one type of industrial action; and, if I do not use "industrial action" as the term, then I cannot do justice to the submissions that I would wish to make to your Lordships.

The last matter is a curious and difficult one which I am sure will cause your Lordships concern. It is concerned with the sit-in. The problem is that according to observations made by Lord Justice Templeman and the noble and learned Lord, Lord Diplock, in two English cases, and a recent decision in Scotland, it has been held—and it is a technical matter but there is a terrifying substance in it—that the construction of Section 13(2) of the Act of 1974 means that a sit-in at a factory, although constituting a trespass, is perfectly lawful because it only interferes with trade and business and it is in furtherance or contemplation of a trade dispute. It is not my function as a mere advocate to say what I think about the decisions of judges, but it is unfortunate and perhaps your Lordships may think that it will make better sense to amend the law.

I have only mentioned four or five matters which your Lordships may consider are matters connected with the Bill within the meaning of the preamble which could properly give rise to consideration for the introduction of a new clause by way of amendment. I hope that my noble friend the Minister can keep an open mind and perhaps give consideration to this at all events.

I wish to concentrate on only one aspect of this Bill: Clause 13 which repeals Section 14 of the old Act of 1974 and restores the position of the courts, the judges, as the regulating force in the sphere of industrial relations. It is nonsense to concentrate on the limited damage provisions. The important matter is that the courts may now grant declarations. They may now grant injunctions, subject only to the provisions of Section 17—I think it is—of the Act of 1980 which affects interlocutory injunctions. The whole thrust of the court's jurisdiction is not really in relation to damages but in relation to its regulating arbitral role in the interests of stabilising the industrial aspect of our society. In this regard the Bill, as an important contribution on the home front, is to be welcomed.

However, looking at it from the other side of the glen for a moment, one can see—can one not?—that from the trade union point of view since 1906 they have had a privilege, an immunity, and it is now being taken away. Is it not right that the justification for taking a privilege away is on those who would wish to take it away? There is the justification because there are wholly-changed circumstances, of which other noble Lords have spoken, and there is the overriding requirement that there should be this Bill so that the area of unlawful activity should be proscribed and that industrial action may be curtailed to what is lawful.

What is lawful is not so very difficult to state briefly. Now, as proposed by the Bill, there is to be no secondary action if there is no primary action which is wholly or mainly related to a primary dispute as defined by Section 29. That is of course a dispute now limited as between an employer and workman. Secondly, there is to be no secondary action beyond that authorised by Section 17 of the Act of 1970 which presupposes the existence of this contract of supply between the party to the dispute, the primary dispute, and the employer against whom the secondary action is taken. Thirdly, taking Lord Boyd-Carpenter's point, picketing away from one's normal place of work in contravention of Section 15 of the Act of 1974, as now amended by Clause 16 of the Bill, is proscribed.

Is that not a reasonable rule of law—a rough and ready assessment albei—to try to curtail industrial action within those limits? If law is—as it always must be—the servant of society and never its master, for the reasons given by many of your Lordships but in particular those of the noble Baroness whom I followed, and perhaps for some of the reasons that I have advanced, I suggest that this is a timely and essential piece of constructive legislation.

8.28 p.m.

Viscount Massereene and Ferrard

My Lords, I have followed my noble friend's legal discourse but I shall not comment on it because time is short and I intend to be extremely brief. I have spoken on this subject many times as some of you will know. A lot of noble Lords have said this is a modest Bill. That may be so. It is certainly a very important one because it deals with the closed shop and immunity of the trade unions.

There are one or two other points that I should like to see in the Bill, as would some of my noble friends; for instance, regarding public utilities, public services, which my noble friend Lord Renton mentioned, as did the noble Lord, Lord Mottistone, and one or two other Peers. I should also like to have seen something in the Bill about the political levy; that members of unions ought to be able to give the levy, to denote the levy—if that is the right phrase—to the party of their choice.

The noble Lord, Lord McCarthy, I believe—I may be misquoting him—said that the 1980 Act brought out the fact that any union member could not pay the levy; but surely the noble Lord is only referring to people who have strong religious convictions. If you have not a strong religious conviction, you have to pay the levy to the Labour Party, I believe. That seems to me slightly unfair, but there it is. It is probably correct to have this fairly short Bill, because if the Bill had been too unwieldy it might have aroused other emotions from the Opposition and from the trade unions generally, which could perhaps be dealt with in the future.

The question of the closed shop, as we have seen in the Bill, comprises well over half the clauses and I think that is highly necessary because it is a very important point in union law. Of course, we all know about the famous case of the railway workers which was taken to the court at Strasbourg and how it has been proved, according to that court, that the closed shop does run contrary to the European Convention on Human Rights. Here I should like to pay tribute to the Freedom Association,whose president is my noble and gallant friend Lord De L'Isle. If it had not been for them, the men who were dismissed by British Rail for refusing to join a closed shop would not have been able to bring their case to the European Court because it would have been far too expensive for them. I cannot congratulate Mr. Prior on his activities in this direction because, as far as I have read the newspapers—though one cannot necessarily believe them—he appeared to be dragging his feet in this matter; and had it not been for the Freedom Association, as I have said, the railway workers would not have been able to bring their case and win it.

That case really did strike a blow for the common law rights of the people. We are inclined to forget that the law which gave trade unions their all-powerful rights, and gave those rights in 1906 when they were actually weak—and it was fair enough then to build them up so that they had the power to represent the workers as against the employers—took away the common law rights of the people as expressed in Magna Carta.

I have always regarded the closed shop as conscription by blackmail. There is an extraordinary attitude on the part of some trade union members, because I have had something to do with them, as I shall explain later. The noble Lord, Lord Plant, said he thought this Bill was very undemocratic. I cannot understand how that can be so. For instance, the unions do not want a compulsory secret ballot in connection with a strike. But what can be more democratic than having a secret ballot? You have a secret ballot for general elections and for local authorities. What could be more democratic than having a secret ballot before a major strike takes place? I really cannot understand that attitude.

I have read in some learned journals that it is reckoned that the unions are responsible for about 1 million of our present unemployed. That is a head-in-the-sand attitude by ostriches, as I call them. I once had a small factory. My interests are chiefly agricultural but I acquired the controlling interest in a factory almost by mistake: at any rate, I found myself there and had to make the best of it. The trouble I found was that as the unions forced up the wages—up and up and up, far beyond productivity—we had only two choices if we were to stay solvent. One choice was to cut down the labour force, which of course is a thing no employer likes doing; and if one does that of course one comes up against the unions and there might be a strike, if you have union labour and shop stewards. So what could we do? Actually what we did—though I personally think it was deplorable because in some ways it was not fair on the public—in order to be able to pay these high wages, was to cut down on our raw material and turn out shoddier goods. One does not like doing that but we had no option. If we had dismissed labour we would probably have had the unions down on us.

What I do not like about the closed shop is that the unions decide who works for an employer and who does not, and that makes it very difficult for an employer. It does not mean efficiency and it can be harmful to one's competitiveness. There is one part of the Bill—I think it is an excellent thing—which I wholly agree with, which is to deal with the appalling habit of some Labour local authorities of awarding contracts to only unionised labour. What could be more undemocratic than that?

Anyone would think, as do some noble Lords opposite, that this Bill will not allow workers to strike; but of course it will, and of course it is essential that they should strike if they feel they are not being fairly treated. It does not actually affect their right to strike at all. What this Bill will do is to prevent a third party who has nothing to do with the employer or the workers in any particular factory—whether the third party is a single person or an organisation—from trying to make workers from outside strike when they do not want to strike.

I have almost finished, but I should like to touch on trade union immunities. As the noble Lord, Lord Marsh, said, it is really absurd that the unions, as the Donovan Report said in 1968, should be above everybody else—above Parliament, above the Queen, above any organisation. They are immune from being sued for illegal acts because at the moment they are largely above the law. As the Bill says, trade unions must be liable for any unlawful acts of their officials. The situation has been extremely unjust for years. As the noble Lord, Lord Marsh, said—and he should know—the funds of the unions now amount to several hundred millions. Why should they be immune? The unions are not heavenly beings. I can see no halos. I know that the noble Lord, Lord Underhill, is now retired. He is an extremely pleasant person, but I can see no halo around his head. So I do not see why the unions should have this enormous power. I should just like to congratulate the Government on bringing in this Bill. I thoroughly welcome it and will support it in any way I can.

8.40 p.m.

Lord Jenkins of Putney

My Lords, the noble Viscount says that he can see no halo over my noble friend's head. I can see no horns and tail anywhere on him. Nonetheless, when he made some of his remarks, I thought that I must look a little closer in case I had overlooked something which ought to be there.

I wanted to take part in this debate, because in the space of what is becoming a quite indecently long life I have been a member of four trade unions and am currently a member of two. The experience of membership of those four trade unions has convinced me that, if there is one lesson that comes from it, it is one which invalidates this Bill totally and invalidates most, if not all, of what has been said in support of it from the Government Benches. The reason is that there is an enormous variety in trade unions, and the experience of the four of which I have been a member demonstrates that there are no two unions which are alike.

It seems to me that, in their blanket dislike of trade unions, the Government are inclined to think of them all together, and they try to carry laws which they think will be generally applicable to the trade union movement as a whole. They will not. That was the trouble in 1971 and that is precisely the trouble with this Bill. That is why this Bill will get no further than the earlier one did. The Government and the Conservative Party are irresistibly attracted to trying to do something about the trade union movement. It is their wealth tax. We have never succeeded in doing much about the wealth tax. We have never got it on the statute book, and this Government will equally fall down in trying to control the trade union movement. It is the point at which both of us fail to achieve our objective, and, as they failed before, so they will fail again.

Towards the end of the war, I was in Burma. I was surveying the fact that I had been in the insurance business and thinking what I had most enjoyed about it. What I had really enjoyed was my work for the trade union which represented the workers at that time. So I decided that when I was discharged I would be a full-time union official. There must have been a strong streak of masochism in my make-up. Anyhow, I did so and joined the National Union of Bank Employees as their Greater London organiser. Later, I became the editor of the Bank Officer and the research and publicity officer of that trade union.

The bank employees were in a great state of discord at that time. Only Barclays Bank and the Co-operative Bank recognised the trade union. The other bank employees supported their own company unions, which the Americans rather unkindly call scab unions. They were employers' associations and the secretary was paid by the bank. By this means the banks succeeded in completely dividing up the unions; so much so that, although something has since been done about it, at that time it seemed totally impossible at get any kind of rational sense into the banking situation.

So that when an opportunity arose for me to transfer to the British Actors' Equity Association I deserted the rather emotional bank employees and turned to the saner and calmer field of acting. I found there a different scene altogether. The reason for that is quite important. On the wall of Equity there was a statement which said: We, the undersigned, will refuse from this day to sign any contract which would deny our right to refuse to work with nonmembers of Equity ". I should like your Lordships to ponder that wording. You will see that what is being asserted is the right of the group, rather than the right of the individual. They were asserting the freedom of the group—

Lord Mottistone

Nonsense!

Lord Jenkins of Putney

Yes, my Lords, That is what it means. Whether the noble Lord thinks that the sentiment is nonsense or not, it is undeniably the fact that that is what it was saying.

Lord Mottistone

My Lords, it seems to be a contradiction in terms to talk about the freedom of the group. Freedom is for people.

Lord Jenkins of Putney

My Lords, I think that the noble Lord is mistaken. If he gives it a little thought, I think he will discover that all society is founded upon the freedom of the group. All of us exist together in society by asserting the right of the group to control the individual. That is why we do not drive on both sides of the road. The group decides that, so far as this society is concerned, we will drive on the left of the road and each individual has to conform. The only way in which society can exist is by laying down rules which apply to the group as a whole. That is what government and civilisation are about. Civilisation is founded upon the proposition that the group exists for the benefit of the whole, and if noble Lords do not think that it is then they ought to look up the Companies Acts; they ought to look at barristers, solicitors and so on. All these arc founded upon the rights of the group, and people are required to conform to those rights in order to exercise their abilities in those fields. That is what it is about.

By picking out trade unions, and by saying that they alone shall not enjoy this freedom, noble Lords are showing themselves to be bigoted and blind—not individually, of course, but collectively. I would not make any charge about any individual noble Lord being in such a state, but collectively it seems to me that this is the position of the Conservative Government in this matter. The consequence of this is that this right of the group to exercise its standards and its obligations is the secret of success.

Noble Lords seem to have forgotten that there is still a strong craft element in the trade union movement. The unions began as craft unions. People required a certain degree of excellence in order to belong. People joined together to perform their special expertise. I say without any hesitation—and anybody who knows the facts will believe it—that the excellence of the British acting profession is founded upon the Equity closed shop. It would collapse without it. After the Government's ill-advised measure of 1971, Equity tried desperately for several years to re-create the closed shop which it had temporarily lost. The closed shop, so far as Equity is concerned—which is an open shop in the sense that anyone can join; but having joined they must belong to the union—is the one certain thing in an actor's very uncertain life, and it is essential so far as the organisation of that trade union is concerned that that union shop shall be maintained.

That being so, what are we going to do about this measure? It is, from the point of view of those of us with experience of trade unions, totally pernicious. It has very little merit at all in it. I shall not take up a lot of time tonight, but I should like to read the introductory two paragraphs of the TUC's industrial relations report on this Bill. What the TUC says is this: If trade unionists had any doubts about the present Government's hostility to trade unions, these have surely been removed by the publication of the Employment Bill on January 28th. Government Ministers do not claim that the Bill will improve industrial relations. They are making it clear that they are out to break the power of trade unions by reducing their ability to take effective action on behalf of members. Nor are they claiming that the Bill is merely directed at curbing controversial but infrequent incidents in British industrial relations, as they did with their 1980 Employment Act. This time they are aiming their attack at widespread and well-established organisational and negotiating arrangements and at the funds of trade unions. Their current targets are the organisational basis of trade unions and trade union influence. The battlefield will be British industry ". I rather suspect that without knowing it the Government have done the Labour movement a great favour in introducing the Bill. Nothing could be more calculated to unite all members of the Labour Party in fierce opposition than an attempt to curb the traditional rights of the trade union movement. Therefore, the consequence of the Bill will be that we shall fight it in a united fashion. We shall fight it bitterly. We shall fight it at all levels in this Chamber, I hope, and elsewhere. I hope that the outcome will be that if the Bill eventually gets to the statute book it will do so in a manner so emasculated that it will no longer be able to carry out the pernicious measures which it is the intention of the Bill to bring into effect.

If we are able to do that, I believe that we shall probably be doing the Government a service. We shall be preventing them from doing something which, when they come to look back on it, they will decide was mistaken—as many Conservatives decided subsequently that their previous legislation on this subject left much to be desired. Therefore, when we come to the Committee stage of the Bill, I hope that we shall examine it in very great detail and that we shall amend it, as and where necessary. It may be that if we examine the Bill with the thoroughness which I think it deserves we shall still be looking at it when we adjourn for the Summer Recess. When Stanley Holloway referred to the Duke of Wellington's remarks when Sam refused to pick up his musket, his final words were: Let battle commence ". I think that noble Lords have given us the advantage in this matter. We stand on good ground and we are ready to take on the Government in a fight which is of their own choosing. This is a fight which, so far as we are concerned, we have always been prepared to carry out. We shall be prepared to carry it out on this occasion, as well as any other.

I am afraid that I am going to take up a great deal more of your Lordships' time when we come to the Committee stage. I hope noble Lords will be as ready to tolerate what we shall have to say on that occasion as they have been so kind as to do tonight.

8.53 p.m.

Lord Belhaven and Stenton

My Lords, I do not intend to follow the noble Lord, Lord Jenkins of Putney, who has just sat down. I always had the impression that the noble Lord was against war, but in a sense he seems this evening to be declaring war upon these Benches. Certainly we cannot say we have not been warned. Unlike the noble Lord, I have not been a member of a trade union, ever, apart from membership of the National Farmers' Union which I do not think qualifies, and I have never been an employer in a big way. Therefore, I want to take up your Lordships' time for only a very few minutes.

One should make it clear that it is useless and incorrect to say that because one is neither an employer nor a trade union member one is not intimately involved in this Bill and in the matter of trade union rights and activities. All of us in this country are now involved in one way or another with the unions and what I believe to be their presently excessive powers. For instance, they have the power to deprive us of medical treatment—which they are doing to people today in what is, I think, a most disgraceful dispute. They have the power—Mr. Scargill has directly threatened to use it—to cut off our heat and light in the winter. They have the power to strand us at ports and airports. They have the power to inflict almost every conceivable kind of damage upon us.

It is not merely the fact that they have these powers. It is the fact that we know that they use them, that they are prepared to use them and that, as things stand, the British public is practically powerless to resist. That is, the British public is powerless, except through its elected Parliament which can pass legislation to restrict the powers of the over-mighty subject. That is, I submit, in general, no matter the particular clauses of the Bill, what Her Majesty's Government are trying to do in this Bill, and that is why I support it.

8.55 p.m.

Baroness Seear

My Lords, the hour is late and nearly everything that could possibly be said about the Bill has already been said several times. So I shall be brief. Certain noble Lords have said they do not understand why it is called an Employment Bill. There is a good reason why it should be called an Employment Bill—or there could be, if it were a rather different sort of Bill. Industrial relations certainly have a close connection with employment. Bad industrial relations undoubtedly reduce employment opportunities. They reduce the efficiency of industry. They reduce mobility of industry. They reduce willingness to collaborate. Therefore, there is a close connection between industrial relations and employment. But I am afraid that I do not think that this Bill as it stands—perhaps we shall be able to improve it and this will certainly be the line which we on these Benches will take—will do one jot or tittle towards increasing employment, towards increasing competitiveness, towards dealing with the things which really matter at the present time.

In many ways this seems to me to be a sadly irrelevant Bill. I was one of the people who, when the 1980 Employment Act was going through Parliament, said I hoped that now we had done with legislation in this field. At least I should have hoped that the Government would wait to see how the 1980 Act was working out. For an Act which was passed only two years ago it is very early days to know what the effect is going to be and to see in what ways its needs to be amended. I must confess that my heart sank when I heard that we were on to this step-by-step approach—that this was step two, that there was going to be step three, and, who knows? step four: one step backwards and one step forwards, and two steps back; and then the Labour Party will come in, so there will be another lot of steps. And so we go on. This seems to me to be totally irrelevant to achieving better industrial relations and all that is implied in doing it. Those of us who have any experience of this know that good industrial relations depend upon the quality of unionism and upon the quality of management inside places of work and the kind of relationships which are established there. Of course, there has to be a legal framework and there are things which are wrong with the present legal framework. But we are concentrating on the wrong things and we are putting back the day when we shall really get going on establishing the kind of environment inside industry which will enable us to have good industrial relations.

Perhaps it is a corny thing to say today, yet I could not help thinking as I listened to the debate, having listened previously to the Statement made by the noble Baroness the Leader of the House, that those paratroopers, marines and particularly the seamen who volunteered to man the QE2 are the sons and the brothers of the people who are inside the factories. Have we not got to ask ourselves why it is that we can get such magnificent co-operation in one set of circumstances yet fail so utterly to get it in other sets of circumstances? There are questions there which have to be answered by management and by trade unions as we look at the lack of the kind of spontaneous volunteering and spontaneous collaboration which we have obviously been getting in the South Atlantic over the last few weeks.

So the speech to which I felt myself most drawn in your Lordships' House this evening—I must confess I have not been here throughout the debate—was the speech by the noble Lord, Lord Houghton of Sowerby, who said: Can we not do something to get moving on a different track? We on these Benches will certainly try to put down amendments which will enable the Bill to become a better Bill and to put into it something which is positive and creative.

Where are the industrial democracy initiatives? We have talked about it for so long. We have buried all attempts to do it. There was the great sense that once Bullock was dead the whole thing would go to sleep and we need never bother again. And yet in that direction, and in the development of industrial relations based on better workshop relationships through industrial democracy, lies the hope of some really progressive advance—and of some advance that will last. We have had Bill after Bill and battle after battle. We have drawn up adversarial lines between the two sides of this House, exaggerating and not reflecting the adversary inside industry. Thank heaven! even today, there is a great deal of industry where one does not have the degree of adversarial approach which is reflected in this Bill and within the discussions which are going on. I would much prefer to have seen a more constructive content in the Bill in an attempt really to create in the industrial relations field something that would last.

Having said that, I cannot be totally opposed to this Bill, nor can my party. I must be quite frank and say that some of the things which the Government think they are doing are the right things to try to do. My quarrel is with the way in which the Government are doing them. I for one do not like closed shops. I totally disagree with what was said by the noble Lord, Lord Jenkins of Putney, about freedom being with a group. My goodness!—society is not made up of groups, but of individuals who form themselves into groups. The protection of groups when they have formed themselves into groups is fine, but there is an unbridgeable gulf between people who say that the basic unit of society is the group and the people who say that the basic unit of society is the individual.

I think that some limitation on the closed shop should be imposed. I also think that, to a considerable extent, the trade unions have "asked for it" as far as the closed shop is concerned. There never was any need to deny the people the right to compensation if they were driven out of their employment because they refused to join a trade union. If there had been a more tolerant attitude taken in the days when the Labour Party was in power, then we would not be having this ping-pong over closed shops, compensation, and so on, which we are having at the present time.

I am not in the least convinced when I am told that the closed shop is quite a good thing because both employers and trade unions quite like it and are really quite fond of it. When I hear that, I am deeply suspicious. From the point of view of the individual, the consumer and the public at large, it is a dangerous situation when employers and trade unions are getting on all that well. Perhaps that sounds a little contradictory, but there are reasons to be suspicious when it is too convenient for two sides of industry to get together at the expense of people outside. There is a real point there that is worth bearing in mind.

Nor do I accept, in connection with the argument over the closed shop, the fact that it may be good for industrial relations. I accept that in certain circumstances it is good for industrial relations, because quite often it is easier to run industrial relations when one has a closed shop. I see the point of the particular difficulties of seamen, as I see the point about the particular difficulties of Equity. One would not wish to be dogmatic in one's attitude towards the closed shop, but I do not believe that the rigorous pursuit of the closed shop is something that one can possibly support. It is not a good principle and it is very much better for unions if they have to fight to obtain and keep their membership. Many of us have been connected with organisations and have a working knowledge of organisations in which unions have been very strong and effective without having a closed shop, or without even seeking to have a closed shop.

I disagree with the ridiculous compensation the Government have decided to award. I do not believe that most people in the past who have protested about being forced to join have invented their consciences. There may be a few who have, but I believe they were exceptional. But how may of us could really resist, in certain circumstances at any rate, the opportunity of having £31,000 free, gratis and for nothing just for deciding that we do not want to join the AUT, as it would have been in my case? I would leave the AUT for a good deal less than £31,000. I believe this is quite an unnecessary provocation to people suddenly to discover that there are reasons why they do not want to belong to a trade union. So it goes on through this Bill.

I will take two other methods which are being used, which seem to me to be unfortunate, to say the least. First, I am not happy about the selective dismissal of strikers—and not as much has been said about this aspect this evening as I expected. Everyone agrees with the importance of freedom of association, but it is still true that freedom of association is not real without the right to strike, and selective dismissal of strikers is a serious limitation on the right to strike. I do not consider that it is in the interests of good industrial relations to have included that clause.

Again, although I see the point about limiting the immunities—and I believe that in some respects the immunities have gone too far—I am not a bit happy about the charging of trade unions for vicarious action. I do not believe that this power will ever be used. What on earth is the point of putting into a piece of legislation something which deeply exacerbates the unions and which gives ill-intentioned people in the unions the opportunity to whip up antagonism where least we need to have it, for something which the employers are not going to use?

If the Government had limited themselves to some degree of control over certain compensation for evicted members on grounds of not wanting to be in closed shops; if they had restricted themselves to the ability and right of people to give contracts without a union clause; if they had some limitation of the immunities, but not as widespread as those which they do have, then it would be a very much better Bill. I say again, I do not really think that it is timely or sensible or necessary to have introduced it. There are points in it which we on these Benches will support but we will certainly attempt to amend the Bill to make it a more acceptable, more rational and more relevant Bill than it is at the present time.

Lord Campbell of Alloway

My Lords, before the noble Baroness sits down, is it in order to ask her a question: whether she would agree, if we leave aside the question of damages, that the restoration of the jurisdiction of the courts to grant a declaration or an injunction in the sense which they could do in the past is useful and constructive?

Baroness Seear

My Lords, I am very glad the noble Lord, Lord Campbell, reminded me of that. I had made a note to say something about it as he spoke. My own view—and I am sorry to say this to an eminent lawyer—is that the less the judges come into industrial relations, and indeed the less lawyers come into industrial relations, the better we shall all be.

9.10 p.m.

Lord Wedderburn of Charlton

My Lords, how to try to wind up from this side of your Lordships' House an interesting debate: perhaps first by addressing the noble Earl, Lord Ferrers, and taking the opportunity to congratulate him from this side of the House on his recent honour, and to sympathise with him in having to wind up the debate from his side of the House. I have been listening all afternoon and evening for the answer to a simple question about this Bill. What has happened since 8th April 1981 to require this legislation? That date is a very important date, because on that date the noble and learned Lord the Lord Chancellor gave evidence to the House of Commons Employment Committee, and in the midst of other sentiments of a similar kind he said—this is at column 202: We legislated in 1980 about what we thought to be the immediate problems that were capable of enforcement. So far the thing has worked reasonably well, as well as things can be expected to work in this wicked world… Your Lordships will note the phrase and note that this is indeed a quote from the noble and learned Lord: If a situation arose in which a new and specific grievance manifested itself to the point where enforceable legislation was demanded and was feasible I should change my mind, but I do not think that is the point of time at which we are now. In the short time that has followed the Government have presumably found new and specific grievances which the noble and learned Lord and the rest of the Cabinet see fit to meet by this legislation. Why have we not heard them this afternoon?—with one exception perhaps, and that is not very new. I heard the noble Lord, Lord Marsh, talk about the gravediggers in the winter of discontent before 1980; I heard the noble Lord, Lord Boyd-Carpenter, and many other noble Lords speak generally; Lord Aylestone spoke of the malpractices of trade unions increasing; Lord Cockfield, who introduced the Bill, talked about trade union excesses and of trade unions as engines of oppression in our society. But, my Lords, it really does need stressing that these trade unions that are so powerful are not sufficiently powerful to prevent 3 million of our citizens being without work, and many of our young people having nothing to do except walk the streets under this Administration. So if that is the problem and this Bill is meant to meet it, then it is not particularly well aimed.

Indeed things have happened since 1981. For example, there has been a lot of research on industrial relations. I thought perhaps I would hear in this debate the Government come with some of the research, research undoubtedly of which I knew nothing, to tell me of the new problems of British industry. But not a word; no doubt they have saved it up for the best at the end, for the noble Earl, Lord Ferrers. Perhaps he will mention the work done in Warwick, which shows that the closed shop arrangements of British industry are not—and I say emphatically "are not "—engines of oppression against individuals. Perhaps he will mention the general research which my noble friend Lord McCarthy spoke about, research which the Government have had now for many months, commissioned by the previous Government but in the possession of the department, which, they are on record as saying, Professor Gennard says is not yet ready to be published. That is the posture of the Secretary of State. Well, if Professor Gennard is not ready for it to be published, would they like to release the tentative figures, the interim draft? Are the figures in the Observer newspaper true? Are the same figures in the Financial Times true?

What is the status of this piece of research, which the Government know very well shows that injustices to individuals are an exception, shows that the benefits which managers recognise from many union membership agreements are very strong indeed? I pause to emphasise, as my noble friend Lord Underhill and my noble friend Lord Jenkins did, that union membership agreements are agreements between employers and trade unions for the benefit of the majority of workers. Indeed, I say this to noble Lords who have spoken about individual rights. First, I will not be found lacking in saying that those who suffer injustice in a closed shop or in any other organisation should not be without remedy. I happen, through my experience on the Independent Review Committee which tries to deal with some of those problems, to think that it is a problem shown up in our figures of some 50 cases in six years. That is only part of a larger picture. But there is no evidence from the Government that it is a very large problem of British industry. Of those 50 cases we thought that we should make 13 orders against the union. It is a voluntary arrangement and those orders were obeyed in 13 cases. But there is no evidence from the Government that the problem is of greater magnitude. There is no evidence at all to suggest, for example, that the problem of the closed shop, either in individual terms or in terms of the effect that it has upon the economy, requires the ludicrous suggested proposal of an 85 per cent. majority of those voting or 80 per cent. of the electorate of employees, before the closed shop can be valid in terms of a dismissal as this Bill suggests.

I note with interest that the Liberal Benches and the Social Democratic Benches at least seem to understand that that particular point is rather impracticable and perhaps rather unjust. It is unjust because of the second point. Alongside the rights of the dissenters I assert the right—in perhaps a slightly different form but very parallel to that of my noble friend Lord Jenkins of Putney—of the individual trade unionist to assert with his fellows that he will work alongside only those who contribute to the fellowship from which they all benefit in collective bargaining. I assert his right to say that and to take action accordingly. If the two rights conflict that is surely nothing new.

Noble Lords have spoken about the right to dissent as though it existed in some abstract world, in some cases a cloud cuckoo world, an entertaining world, as the noble Lord, Lord Houghton, said in one contribution, but a curious abstract world. Indeed, do not the Government also put forward a Bill which is remarkably abstract?—that is to say, we shall hear in Committee I know of Joanna Harris, three railway workers, four Walsall dinner ladies and no doubt six Ferrybridge workers. That is all we have heard about so far in the published documentation as regards this Bill justifying its extraordinary proposals. They are about as relevant to the British economy as a partridge in a pear tree. Not only that, they also omit the other side of reality.

The other side of reality to the four Walsall dinner ladies is that in Kent, back in May this year, 3,500 dinner ladies, because of Government cuts, had a very high wage cut, beginning at about £30 a week, which is what they earn. Because of Government cuts the local authority had to cut their wages 23 per cent. That happened all over the country. Indeed, hundreds of thousands of people working in schools in that way faced that fate. But there is not a word about them in the Bill—and there is not a word about them in the Bill for a very good and central reason and this is why the Government cannot answer the question: What has happened since April 1981?

The Bill is not about good industrial relations. The Bill is not even about—and here I pause, if I may say so, with respect, on the one exception of the facts which have been put in evidence after April 1981—the problem that the noble Baroness, Lady Burton of Coventry, put to us. Of course, there is a problem in respect of workers who withdraw their labour and exercise their right to do so in various areas of public service and, indeed, sometimes in the private sector. It depends how you organise your society.

However, before the noble Baroness heaps all of her blame—and I shall look again at Hansard in case I am wrong about that, but I think I am right in saying "all of her blame"— upon the trade unionists in that position, she might perhaps have mentioned the proposals made by the TUC Health Service Committee about the reform of pay and structure and the resolution of disputes without industrial stoppages in that sector. The noble Baroness might perhaps have asked whether those who face 4 per cent. do or do not fall into her category of those who are justified in taking 24-hour industrial action. She might have asked herself whether the Royal College of Nursing should be driven to the brink of industrial action as appears to have happened by the sort of offer that it has had.

Obviously we cannot have that debate because it is a different debate, and it is different because the Bill has nothing to do with it. It offers nothing at all. It offers not even as much as the Industrial Relations Act 1971, because those who presented the Industrial Relations Bill in 1971 at least had a vision in which industrial relations were included. It was a nightmare. It was a mad vision. It did not work, but at least they said that they believed in reforming industrial relations. There is not a word from this Secretary of State as regards reforming industrial relations, and the central reason is surely a hardening of the doctrine within the Government—the doctrine which my noble friend Lord Kaldor, with his usual perspicacity, picked out very early in 1980 when he said, on 16th April 1980, at columns 324 and 325, in your Lordships' House, using a phrase of Professor Hayek: in order to succeed, it is not enough for the Government to reduce effective demand and thereby induce a slump in production and employment. They must break ' real wage resistance ', and this is the crucial factor in their whole strategy ". The breaking of real wage resistance is, of course, a Hayek concept, as is the notion of what trade unions are about.

I make no complaint about the Government's deception this time round. Last time I thought that their policy only peeped out from under the edges; this time it is quite straightforward. It is the Hayek doctrine. I am sure that noble Lords who sit on those Benches would take Professor Hayek very seriously, because on 10th March 1981 the right honourable Lady the Prime Minister said, at column 756, in the other place: I am a great admirer of Professor Hayek. Some of his books are absolutely supreme ". She picked out those three well known volumes on Law, Legislation and Liberty. This is a very significant date because it is March 1981 and I am not sure that she told the noble and learned Lord before he gave evidence to the other place that she had been reading Professor Hayek, because if you look at Professor Hayek in the third volume of Law, Legislation and Liberty, at page 144, you find the doctrine in its pure form. We are told that trade unions, in most countries have been authorised by law or jurisdiction to use coercion to gain support for their policies". I pause there because Professor Hayek does not have any of this nonsense about unions being specially bad in Britain. Well, he does; at another place he says that it is particularly bad in Britain, but that is a footnote. He says that in most countries it has happened. Then he goes on: Though this fact is conventionally still ignored, the chief powers of the trades unions rest today entirely on their being allowed to use power to prevent other workers from doing work they would wish to do ". He goes on a little later: combined with the necessity in which they can place a Government that controls the quantity of money to inflate, this system is rapidly destroying the economic order. Trades unions can now put Governments in a position in which the only choice they have is to inflate or be blamed for the unemployment which is caused by wage policy of the trades unions.…This position must before long destroy the whole market order ". I make no comment upon the speech of the noble Lord, Lord Harris of High Cross, because, of course, that was the doctrine of his speech and I would expect no other in terms of Professor Hayek's writings. But it is clear that Professor Hayek has not only made a hit with the right honourable Lady, but he has now managed to gain further credence inside the Cabinet, and this is his Bill. It is a test tube Hayek measure without any doubt at all. The Secretary of State makes that clear. My noble friend Lord Underhill cited now the best-known passage of the Secretary of State's speech on 8th February during the Second Reading of this Bill, in which he stated, at column 742, that: when the Bill reaches the statute book it will provide the most comprehensive and the most effective statutory protection for non-union employees we have ever had in this country ". That is the theme. It is matched by a straightforward honesty about such matters as the "lump", because in column 744 he is challenged and asked about the lump. He says in reply: The hon. Gentleman may not like the lump, but, properly managed, it is a very effective institution". If you want non-unionism and lump labour with special awards of £10,000, £12,000, £15,000 for non-unionists who are dismissed—every time a prize—then you get this Bill and, moreover, you get a Bill in which—and as no one has said much about this I pause to say just a sentence upon it—there is the most extraordinary clause and schedule that has ever been put before Parliament for many years. That is Clause 1 and Schedule 1. Your Lordships must look at this. Whether to call it retrospective or retroactive is a matter of semantics, but in its present form it gives the Secretary of State total discretion to hand out £2 million of public money to people who he decides would have won a case if they had appeared before a tribunal under a set of rules that he is having enacted, without his being bound by any findings of a tribunal. I ask the noble Earl to tell me that I am wrong on this, because I hope I am, but the last printed words at least of the right honourable gentleman, the Secretary of State, are that he will not disclose the names of the persons to whom that public money is given. That cannot be right. If a second Chamber is there to control Ministers, it surely must control that kind of arrogance.

Then one goes on to find the sections of the Bill, which I pass over quickly but which are very important, dealing with agreements to use union labour only, or non-union labour only. I only say this especially to the noble Earl, Lord De La Warr, if I may, that of course this is a serious matter. It is part of the plan for non-unionism overcoming trade unionism. But it is serious in terms of agreements which relate to safety, which relate to sub-contractors, which relate to undercutting minimum rates, and also—and this is the point, if I do not misremember, that he made—that Labour councils did not really need to worry, they could still go on adopting some such practice, he it not overtly, because nobody would sue them.

The noble Earl, in my judgment, is not well advised in taking this point, for two reasons. First, and the Government have made this clear, that there is the district auditor lurking around the corner, and the Government are setting the district auditor to work as part of a political pattern in this matter, which is a quite disgraceful pattern. Secondly, and this is a general point on the Bill, you have to worry about being sued under a Bill of this sort because you cannot just say, "Well, sensible employers will not use it". Of course sensible employers will not use it. A lot of sensible employers did not use the Industrial Relations Act. The question is, what about the George Wards and the Grunwicks? What about the Freedom Association who will be prompting plaintiffs all the time? What about, if you like, the worker who says, "I will have a go at that. They are all getting prizes up to £10,000. I'll bring an action as someone adversely affected "? If the noble Lord looks at Clause 11(7) he will find that anyone "adversely affected" can bring an action. It is not a good thing to enact legislation and to say, "It will be there, but it will not be used because sensible chaps won't use it ", because we are not all sensible chaps. Even our definition of "sensible chaps" is not always the same.

The same goes for joinder. This is a matter that we must take up in Committee; but one word on this too, because the Government are changing the rules in unfair dismissal to the disadvantage of trade unionists. That you might have expected. What are they doing? They are allowing the claimant, the dismissed non-unionist, to join the union, or the shop steward, or the other workers, if they put industrial pressure on the employer to dismiss him. You may say, "What is wrong with that?" One thing that is wrong with that is what was said about it in the Committee stage of the 1980 Bill. That was exactly the proposal that came from the Liberal Benches in the Committee stage on the 1980 Bill. The Government would not have it. The Government would not have it on good arguments. While the employer maintains control of the joinder procedure in the industrial tribunal, he has some hope of controlling his own industrial relations, because he can decide when to sue the union or when to sue the shop steward.

What did the Government say? They said at col. 1072 on 11th March 1980 that if you had it differently and allowed the claimant to joinder the union or the other workers, One might then have a kind of running sore that could lead to great disruption and bring harm to the firm itself ". There is much more to quote of the same kind, but that is not out of context. So the Government are now legislating on the basis of what in 1980 they themselves said would create running sores in industrial relations.

It is adding to that, at the final part of the Bill, the area of the depletion of trade union rights. "The depletion of workers' rights", it would be better put, because your Lordships will know that it is anyone who acts in furtheramce of a trade dispute who has rights in our system of law. It is a most important point that we have never had a system of law which granted the basic industrial rights to trade unions as such. We have always since 1906—in that great year when the great Liberal Government, before the party lost its roots, enacted industrial legislation on a liberal basis—had industrial legislation which said that anyone who acts in furtherance of a trade dispute is to be afforded this right in the form of an immunity, as pure legal form.

What are the Government doing? First, they are squeezing the basic concept of trade dispute as close as they dare. Secondly, they are increasing the employer's right to dismiss those who dare engage in industrial action. Thirdly, they are taking away statutory protection in respect of which trade unionism can more easily be destroyed in the courts. On the first point, there is an important feaure which your Lordships have not had put to you as a matter of principle in respect of the squeeze of the basic concept of trade dispute. It permits the Government to offer a law whereby the workers' side in a dispute will necessarily be sliced in a salami tactic. That is, by changing the definition of trade dispute to a dispute between a worker and his own employer or an employer and his workers—not even to include associated employers, a point on which we shall press the Government very hard—they are stating, in a very Hayekian manner, that what they want in their market force competition economy is a right for the worker only in respect of his own establishment. No aid for the weak from the strong. No aid across the boundaries of establishments. That is why in Clause 8 they have changed the right to dismiss in strikes—because the unit of workers to be considered is the unit within the establishment—and by that route it is easy to see why the TUC Assistant General Secretary, Mr. Graham, recently referred to the Bill as aiming at the right of the strong to come to the aid of the weak, and of course that is right.

The noble Lord, Lord Marsh, had some fun with the miners and nurses. If that does not attract, I suggest we might find common ground in respect of the notorious exploitation of the crews of ships sailing flags of' convenience. The International Transport Workers' Federation has always regarded Britain, along with some of the Scandinavian countries and a few others, as a country with a liberal tradition that decently allowed them to engage workers—tug workers, British workers; nothing in it for them because they are out to help the crews—but by now the 1980 Act has practically done away with it and this measure will finish it off.

There is another outrage in terms of the squeeze on trade disputes. "Trade dispute" is the central concept supporting industrial rights of action. Therefore, if you squeeze it, the rights of action are smaller. But it has been for many years equally the same definition for the defined area in which, if you are in a trade dispute and unemployed, you do not get unemployment benefit. Have the Government touched that? Not a word. The worker is therefore left in an unemployment situation in a trade dispute and is not entitled to benefit if he is within that definition; but still, under the Bill, he isnot entitled to take industrial action lawfully because the trade dispute concept has changed. We shall press the Government on why they have taken away the link between the social security concept of a trade dispute and the industrial relations laws and concept in that respect.

Then there is the question of immunities. I hope we shall go into that in Committee, but at this stage I will answer those noble Lords who dealt with the matter today. I thought it had become common ground in 1980 that the immunities were not privileges but were the English British, if you like—way through historical circumstance of expresing industrial rights. Certainly that was the conclusion of the Government's Green Paper in 1981 called Trade Union Immunities. To those noble Lords who have joined the right honourable gentleman the Secretary of State in talking about immunities as privileges in this debate, I refer them to the Government's own publication.

But there is a more difficult problem. There has always been one immunity which has been special and separate from the rest, and that is immunity of the trade union itself from the tort liability. That has made no difference whatever to injunctions because injunctions are served on the officials and, in the last resort, it is always the officials who have to answer for disobedience, if there is any. No, the issue is, of course, damages; and let us consider the reason that trade unions were made immune. In the very interesting debates in 1906 the noble Lord, Lord Rochester, will find plenty of references to secondary picketing. There was much more secondary picketing against free labour coming from Ireland in 1889 than there has been in the past few years. There will be found there the reason, which is quite simple—the common law.

People talked about common law rights. It is not the fault of the common law, but the history of the common law which made the common law make trade unions illegal. It did not happen only in Britain; it happened everywhere. All common laws found it very difficult in the 19th century to accommodate trade unions. Therefore, if you say, I am going to restore a common law right and take away an immunity, then you are necessarily taking away a trade union right.

You may want to reach a different balance; now that is a different discussion. The reason why immunity in tort was given to the unions in 1906 was that everybody began to see that unlimited actions for damages against trade unions would destroy the trade union movement, which it became common ground political parties did not want to see. When sometimes I hear noble Ministers and others in the Conservative Party discussing the 1906 Act they seem to forget that in the end they did not vote against it. It is quite true that it had gone on into August and they were all rather keen to get away. But quite apart from that, they were not that opposed to it at the time. They knew this particular bit, they did not like it, but they gave in to it. It was the British way of doing—and I put this to the noble Lord the Minister for discussion in Committee—what most other democratic countries have done; that is, to ensure that their common law does not allow litigants to destroy trade unions in the courts in actions for damages. They do not all do it the same way of course; they all do it differently, and it comes out very differently. It comes out very differently in Germany. That is why it was there.

If it be said that there should be some amendment of that arrangement, it could be discussed. But just to take it away is another matter; and it is not only a case of taking it away (this is my final point) but then also of enacting for the economic tort liabilities a special code of agency, which is what Clause 13 does. It was said: "Let us make trade unions liable in tort ". That sounds fair. But then who are they going to be liable for? They had terrible trouble with the jugdes on that in 1972, in the Heatons case. We cannot have that again. The economic torts, the industrial torts are singled out in the clause—why? Why is libel different from the economic tort of interference with contract? It is a very strange clause. Whatever the rules say, you are going to be liable for the general secretary, president and general executive, and for other officers, unless they are repudiated.

The whole structure of the clause makes it on the one hand a very strict liability—much stricter than the common law—and on the other hand an inducement to repudiate officials down the line of the trade union; and both are indefensible. As the Donovan Report suggested, indeed said very firmly, the law should not try to make trade unions into industry's policemen; and that is one half of the clause. Nor should the law say that the trade union is going to be liable for everything that the president does, presumably short of a fit of madness. That seems to me rather strange. Indeed, that was an amendment recently put in, and I think we can predict that that, and other features, of this very unsatisfactory Bill will be changed in this House; indeed it should be.

This country now has the reputation of being the most backward of the Western European countries in its industrial relations law. When new rights are being offered to trade unions in other Western European countries, the British Government are known, in comparative industrial relations legal terms, as the thugs of Western Europe. So far as the trade union movement is concerned, that is the nature of the Bill.

There is another way. I agree with noble Lords who said this; there is another way. It is a way of finding again with the trade union movement a con-consensus in our society which is needed to build jobs and to rebuild our society afresh. But you cannot do that if you adhere to the doctrines of Professor Hayek. If you do that, you must push the trade unions out.

The dispute between the two sides on this Bill is very simple. This is where I say to noble Lords and noble Baronesses in other parties: You really cannot be neutral upon this Bill because it divides those who say, "I want trade unions to be part of my society, and to build a social consensus with them", and those who say, "No, the market force must rule, and they must be reduced in favour of non-unionism, if necessary by the law".

9.40 p.m.

Earl Ferrers

My Lords, we have certainly had a wide-ranging debate, and, if I might, I should like to start off by answering a question asked by the noble Lord, Lord Houghton. He wondered what agriculture had to do with this Bill. I am bound to say that I thought that was a very pertinent question, because I happened to ask it myself. All I would tell the noble Lord is that they say that variety is the spice of life, and I think that that applies whether you are a Minister or whether you happen to be, unfortunately, a Member of your Lordships' House having to listen to me reply to this debate.

I am grateful to the noble Lord, Lord Wedderburn, for the kind remarks that he made at the beginning of his speech. He sympathised with me in having to wind-up. I am grateful for that, too. He said he wondered what he was going to say when he wound up. I am bound to say that I did not think he found very much difficulty in that. I am bound to say also, though, that I thought he had clothed the debate with a certain amount of academic fog; and when I tried to understand the details and complexities of this Bill I was glad that I was not a pupil of the noble Lord in law. However, we will come to his points in more detail at Committee stage.

The noble Lord was kind enough to tell me of the things I was probably going to say in my speech. I found that interesting. He asked me in an attractively innocent but somewhat donnish way what had happened since March 1981. It may be that he does not know what has happened since March 1981, but I can tell him that three things have happened since then. There have been consultations on the Green Paper which showed that there was a very widespread degree of support for more legislation; there was the dismissal of four non-union dinner ladies in a closed shop dispute at Walsall; and there was the spread of union-labour-only requirements approved by local authorities on non-union matters. Those are some quite substantial things which happened, but let us start off, if we can, with the point on which we agree, because the disagreement really came from many curious parts of the House and curious directions, I thought.

The noble Lord, Lord McCarthy—and this is a point on which we can agree—regretted the absence of my noble friend Lord Gowrie. The noble Lord, Lord Howie, behind him (the one point on which he seemed to be in agreement with his noble friend) also said that he regretted the absence of my noble friend, and he said, "Bring back Gowrie!" I must say that it was touching, the infatuation for the fish that gets away—a deserved infatuation, too. But I can tell both noble Lords that, like Aladdin, I will rub the lamp and the genie will appear, for my noble friend will be helping us, coming back into his old shoes, at the Committee stage. I am not sure that the noble Lord, Lord McCarthy, will find that necessarily a help to his cause, but it will certainly be a very great help to our Front Bench.

The missiles flew in odd directions, although they came with the customary noble courtesy of your Lordships. I liked the appeal of the noble Lord, Lord Howie, to his Front Bench not to ask him for support unless the Bill happened to be wrong. I can assure the noble Lord that if he feels so minded he may not attend the Committee stage of the Bill, because his support for his Front Bench on those criteria will not be required; and I advise him to exhort his noble friends as well. I liked his description of the excitable violence of the noble Lord, Lord McCarthy (I think those were the words he used), because he said that the noble Lord's speech had nothing to do with the Bill. I found that was a fairly good Sidewinder that he put into his Front Bench.

Clearly the Bill has had a mixed reception. At one end of the spectrum we had the noble Lord, Lord Plant, saying that this was a major and unacceptable attack on the trade unions; the noble Lord, Lord Wedderburn, also saying that this was a major attack on the trade unions; and the noble Lord, Lord Taylor of Mansfield, who said that this would cripple the trade union movement and that employers are not in favour of it, either. I would remind him that the measures in the Bill were drawn up in the light of extensive consultations with both sides of industry following the publication last year of our Green Paper on Trade Union Immunities.

The Bill was widely welcomed by many, including many employers and employer organisations; and Sir Raymond Pennock, chairman of the CBI, said that in their view the Employment Bill had it about right. Then the noble Lord, Lord McCarthy, said that he did not like the Bill; that it created ambiguity. I thought that his speech expressed the fears of the 1930s and was designed to send shivers up the spines of the unthinking. He said that the Government's philosophy was to price people into jobs by lowering wages. That is just not true. The Government have always said that you can price people out of jobs by excessive wage demands, and that is certainly so.

The noble Lord, Lord Oram, said that the 1980 Act stirred up some dust and that this Bill was even more divisive and untimely. That is a view. At the other end of the spectrum, the noble Lord, Lord Harris, said that the greatest impediment to industrial progress since the end of the war was the power of the trade unions. The noble Lord, Lord Marsh, in what I thought a penetrating speech, said that the unions were more powerful than the Government themselves. It was impressive to hear a previous full-time employee of a large union say that this Bill, if anything, did not go far enough. He referred to the irrational and exaggerated reaction to the Bill. I wish that I had heard him after the speech of the noble Lord, Lord Wedderburn. It might have been interesting to hear his reaction to that. I was glad to know that nothing in the Bill would have impeded the noble Lord, Lord Marsh, in his duties when he was a trade union official. I doubt if anything does much impede Lord Marsh. It was a good thing to hear.

Other noble Lords took a more moderate view. My noble friend Lord Boyd-Carpenter was in favour of the Bill. The noble Lord, Lord Aylestone, from the Social Democratic Party supported it; and I was glad. My noble friend Lord Renton said that he was glad to know that it was not the end of the road. What I found astonishing was that my noble friend Lord De La Warr sat uncomfortably and remarkably on the hedge. He thought that the Bill was good but said that my right honourable friend should not have introduced it because we have had enough legislation. He even told my right honourable friend—if I heard the words aright—to "lay off" introducing more legislation; and then he proceeded to say that he would put down an amendment allowing secret ballots for the elections of trade union officials, thus vastly widening the scope of the Bill and its controversy. I am bound to say that, as an exercise in intellectual acrobatics, I admired my noble friend's expertise.

The noble Baroness, Lady Burton of Coventry, made a very moving speech about the strikes which were going on in the hospitals at the moment. Her remarks were pertinent, appropriate and came with great conviction. She has always abhorred what are in her view the misuses of union power. She said that there are people who must stand up and be counted. The noble Baroness has always done that. The noble Lord, Lord Houghton, made a fascinating and impish speech. He took a swipe at everyone, but then he always does. He said that the Government were banging their heads against a brick wall in bringing in trades union legislation which never stuck. He then accused the trade unions of squealing before they had been bitten. Then he said that the Government should get off the seesaw and on to firm ground and be tougher. I thought he was being a hawk over this—and then he said, "Drop the Bill". I did not know what the noble Lord wanted in the end, but it was a fascinating speech.

The noble Lord, Lord Jenkins of Putney, said that this subject was to the Conservative Party like the wealth tax was to the Labour Party. The noble Lord is not in his place—he has vanished… He said they had never got the wealth tax on the statute book. Therein lies the great difference because this Bill will get on to the statute book. I found astonishing his philosophy that the whole of society is founded on the group. I found that totally unacceptable. The noble Lord, Lord McCarthy, is saying to me that his noble friend did not say it. I listened to him say it about six times. I always thought that the whole of society was dependent upon the individual. What the noble Lord was expounding was a view of collectivism.

If one can forget the heat and the passion, the overriding aim of the Bill is quite simple: it is to try and get a better balance between, on the one hand, the rights of trade unions and, on the other hand, the rights of the individual. Both those rights are very important, and the balance between them is important. What the Bill seeks to do is to shift the fulcrum a little bit away from the trade unions and a little bit towards the individual. That, on the face of it, does not seem to be a bad or wrong thing to do.

Within this overriding aim, there are two fundamental objectives—objectives which were set out by the Secretary of State for Employment last November, when he published his proposals for legislation. The first is to safeguard the liberty of the individual from the abuse of industrial power. In particular, the measures to increase the protection for employees who work in a closed shop but who do not want to join a trade union, are directed to that end.

My Lords, let me say this: there is no one who does not recognise the important contribution which responsible trade unionism can make to a democratic country and which it has made, and does make, to this country. Trade unions need, and deserve to have, important and fundamental rights—the right to organise, the right to seek recognition, the right to bargain collectively with employers and the right, in the ultimate, to organise industrial action by their members in pursuit of better pay and conditions. The law in this land fully protects those rights, and there is nothing in this Bill which will detract from them.

But is not only trade unions which are entitled to have rights. Individuals have rights too—the right, for example, to decide for themselves whether they wish to join a trade union or not, or whether to take part in industrial action or not. Inevitably, of course, these rights of the individual will be bound sometimes to conflict with the collective rights of trade unions. That is where the law has to be involved. That is where Parliament has to decide exactly where the balance is to lie between these conflicting interests.

The noble Lord, Lord Plant, said that this was a major and unacceptable attack on the trade unions and that the Bill took the power away from the unions and tilted it against the working people. It does nothing of the sort. It assumes that trade unions—if one takes that view—are synonymous with the wishes of working people. That is not always so. The purpose of this Bill is to shift the balance away a little from the trade unions and towards the individual. The individual is just as much a working man as is a member of a trade union. The Bill is not against trade union members but it affects the corporate body of trade unions and their relationships with individuals. We believe that this balance is not correctly struck at present. In order to adjust it, the Bill provides for secret ballots if closed shops are to continue. I fail to see how that can be classified as objectionable. It increases the compensation for those who are unfairly dismissed from closed shops for not being union members.

The noble Lord, Lord Wedderburn, once said at Question Time to me that this was repressive legislation. I found that an odd description. To me it is the very opposite to repression: to provide that people who work under closed shop arrangements should have a chance every few years to say in a secret ballot whether they want to work in a closed shop or not. How can that possibly be repressive? It is simple democracy —the right, which as far as I know everyone in your Lordships' House, indeed both Houses, has always had—of the citizen to have a voice in his own destiny. Similarly, I fail to see how it can be repressive to pay a satisfactory level of compensation to someone who is unfairly dismissed in a closed shop. Compensation for unfair dismissal is something dear to the hearts of noble Lords opposite, and it is just as unfair to dismiss a person unfairly from a closed shop as it is to dismiss him unfairly for any other reason. This provision simply is to make just recompense for a wrong which has been done.

The second objective of the Bill is to improve our economic performance as a nation. Some people say that the Bill has nothing to do with improving industrial performance and competitiveness and that it will not contribute to our economic recovery. The noble Baroness, Lady Seear, put it with her customary force. She said it would do not one jot or tittle to inspire competitiveness or to encourage employment. The noble Lord, Lord McCarthy, I think said that the Bill did nothing to help the unemployed. I find that extraordinary. I wonder: does the noble Lord not think that the power of the trade unions in the winter of discontent had no effect on the economy, on the disruption of work or on the disruption of businesses? Of course it did. As the noble Baroness, Lady Burton, said, and as I believe the noble Lord, Lord Marsh, also said, the trade unions were never designed to "take it out of people" and to take it out of the poor, the weak or the sick—I think those were the words of the noble Lord, Lord Marsh—or to use the immunities Parliament has given them to supersede the wishes of Parliament. I do not accept the view that this does nothing for employment and the economy.

Of course the Bill will not sweep away all the barriers to increased prosperity and industrial recovery which at present may exist. For those who are fortunate enough not to have a closed shop or not to have suffered from union-labour-only requirements or damaging industrial action, the Bill may not seem immediately relevant. But, within the specific fields with which the Bill does deal, the proposed changes will at least help to contribute to our recovery. It will, for example, deal with those strikes and other industrial actions which are particularly disruptive to an employer's business when he can do little or nothing to resolve them. They are the strikes which have nothing to do with relations between an employer and his own employees, and which are about matters which are wholly external to the firm. It will also tackle the practice of refusing to allow firms who employ nonunion labour to tender for contracts which they are otherwise perfectly well qualified to undertake. This is a practice which clearly militates against competitiveness and which has been used by some local authorities in order to restrict competition against their own direct labour departments.

The noble Lord, Lord Harris of High Cross, said, at least by implication—and his remarks were echoed by the noble Lord, Lord Marsh—that the economy has suffered from a refusal of trade unions themselves to take responsibility for the unlawful acts of their officials. At present, for example, trade unions can organise secondary picketing and secondary action which can cause immeasurable harm to companies and employees who are not even involved in a dispute, without those unions ever being called to account in the courts for the effects of their action.

My noble friend Lord Boyd-Carpenter said that the Bill merely brings trade unions, in this limited sphere, on to the same footing as everyone else. He is quite right. It makes it unlawful for a trade union, as a body, to do that which at present it is unlawful for trade union officials to do, as individuals; and I am bound to say that I cannot see what is wrong with that. It does this by making them liable to be sued for an injunction or for damages, if they organise unlawful action. It is based on the principle that, if you make people liable for the consequences of their actions, they tend to think more about those actions.

The noble Lord, Lord Oram, said that the Bill takes the law back to where it stood after Taff Vale, and my noble friend Lord De La Warr said—and I agreed with him—that such talk left him unimpressed. He modestly said that he was too young to know about it. So am I and, indeed, so was my father. But I rather think that my noble friend carries his years well. In fact, this does not take us back to where we were before Taff Vale. Between the Taff Vale judgment and the 1906 Act unions and their officials had no immunities at all from actions at civil law. Any and every form of industrial action, without due notice, was unlawful. There is no question of returning to that position. The Bill will simply bring the unjustifiably and unnecessarily wide immunities of trade unions into line with those for their officials, and it will in no way affect their ability to call primary industrial action in support of a dispute between an employer and his own employees.

The problems of the closed shop in terms of our economic performance are, of course, an emotive area. Much is understandably made about the "free rider". The noble Lord, Lord Underhill, said that this would be a charter for "free riders" and it is easy to understand the view of trade unionists about the individual in their midst, whom they see as benefiting from the efforts of trade unions without paying the price. Of course, one sees that. But one has to ask—and many people do ask—where the supposed free ride is, in fact, leading. Very often the answer is that the beast on which the man is having a free ride is not taking him to prosperity and to better real wages, but to redundancy and unemployment. It is quite clear that in many instances—of course, not in all instances—trade unions, by clinging to restrictive practices and forcing up wage levels without any corresponding rise in productivity, have succeeded only in leading their members straight on to the dole queue and putting employers out of business as well. It is little wonder that some people do not want to be part of a set-up which takes them for a free ride in that direction.

Few people would now doubt that the economy can, without question, be harmed by the degree of power which the closed shop gives to trade unions. It gives a power to coerce not only employers, but individuals, too. I dare say that the noble Lord, Lord Jenkins, is in favour of that. But, in our view, such a coercive power can, in many cases, only reinforce restrictive practices and this makes it more difficult to bring about change. It is for this reason—and because of the effects of the closed shop on individual liberties—that we regard the measures on the closed shop in the Bill, modest though they are, as essential.

The noble Lord, Lord Rochester, said that he was worried about people being victimised if they are dismissed from being on strike. What the Bill provides is that an employer can dismiss employees who are on strike on a particular day, without facing unfair dismissal claims, so long as he dismisses all those who are on strike on that day. But if he dismisses just some of them who remain on strike, then those people can claim for unfair dismissal. So, contrary to what the noble Lord said, the Bill does not allow an employer to victimise certain strikers by dismissing some but not all. The difference which the Bill will make is that, as the law now stands, an employer who wants to dismiss employees who are on strike can do so without facing claims for unfair dismissal only if he also dismisses any employees who have been on strike but who have returned to work.

The noble Lord, Lord Rochester, also thought that the percentages required in a closed shop ballot were too high, and so also did the noble Lord, Lord Howie. I agree that the percentages are high-80 per cent. of those entitled to vote or 85 per cent. of those voting. If a closed shop is still to have legal protection against unfair dismissal claims, those figures are required. But a closed shop removes basic individual freedoms—for instance, the freedom to choose whether or not to join a union. Therefore, the Government believe that before these basic freedoms are removed it must be shown that not only a majority but an overwhelming majority is in favour of the closed shop continuing.

The noble Lord, Lord Oram, said that the Bill hampers the trade unions' legitimate right of 100 per cent. membership. Nothing of the kind. The Bill does not hamper that right at all. All it does is to prevent a whole lot of people being swept along in acquiescence who may not wish to acquiesce. But if they do, they only have to have an 80 per cent. approval.

The noble Lord, Lord Rochester, said that he was worried about damages. There is room for argument about what should be the limits on damages which can be set against trade unions. These are set out in Clause 15 and, in the Government's judgment, following upon consultations, they are about right in order to strike a correct balance between on the one hand the need to protect trade unions from bankruptcy and, on the other hand, the need to ensure that those who suffer loss can claim adequate recompense for the loss which they have suffered. The actual sums in Clause 15 are based on the limits which were contained in the Industrial Relations Act 1971, roughly updated to take account of the increase in trade union funds since that time. We must remember that no trade unions will be liable for damages if they remain within the law.

My noble friend Lord Boyd-Carpenter referred to an article in The Times regarding the Civil Service strike. There is nothing in the Bill which prevents civil servants from being in dispute with their employer about their own pay, conditions or job redundancies—indeed, all the normal subjects of a trade dispute. Nor is there anything to prevent them from going on strike in support of such disputes. So long as the dispute is wholly or mainly about pay, conditions, jobs, et cetera, it is immaterial to the lawfulness of the dispute if it also happens to challenge a Government decision.

My noble friend Lord Boyd-Carpenter also asked about the health service dispute. He asked whether secondary picketing is unlawful and what action will be taken. The secondary picketing which has taken place in the health service dispute by some health service workers, by miners and by others is unlawful under the Employment Act 1980. Those individuals who are responsible may be liable to be sued in the High Court under the civil law. The enforcement of these provisions does not rest with the Government but with those employers and individuals who suffer loss or damage as a result of the unlawful secondary picketing. It is up to those people and those employers to decide whether they wish to sue for an injunction or to sue for damages.

My noble friend Lord Renton asked about shipping.

The Government are aware of the main concern which has been expressed within the shipping industry about the closed shop balloting provisions of the Bill. While we are not as yet convinced of the need for any special treatment for shipping in relation to these provisions, we shall of course consider carefully any arguments which happen to be put forward in Committee.

My noble friend Lord Campbell of Alloway referred to the sit-ins. He referred to the fact that as a result of a recent judgment in the Scottish courts, sit-ins in Scotland appear to be lawful. The Government agree with my noble friend that this is a surprising and an unexpected judgment which has caused considerable concern among employers in Scotland. We are at present considering the case to be made for an amendment to the law.

The noble Lord, Lord Rochester, said the Bill will not improve industrial relations and the noble Lord, Lord Oram, said that you cannot legislate for good industrial relations. Of course he is right. In the end the law can only be a framework for industrial relations. It can influence attitudes and behaviour. It can set limits on acceptable practices. It can protect the weak against the abuse of power by the strong. Of course there has to be law, because it is only by law that we can define the areas of what is acceptable and what is not acceptable. By legislating, we are not setting out to destroy but merely to determine.

I agree with the noble Lord, Lord Oram, that it is not the amount of legislation which itself is going to make industrial relations work. This is for one simple reason. What makes industrial relations tick is not the law or the Government, but people; managers, workers, shop stewards, clever people, stupid people, energetic people, slothful people, hardworking people, easy-going people—the whole spectrum of society which is made up of people, their attitudes, their determinations, and their opinions. That is what makes industrial relations tick and that is what creates its variety in different circumstances. It is the people who work in industry and commerce, and who daily have to face the problem of producing goods and services as efficiently, competitively and as happily as possible, who make industrial relations tick.

The passage of this Bill will not remove the need for managers, trade union officials and employees constantly to continue their efforts to improve industrial relations at shop floor and office level. The Secretary of State of Employment has described this Bill as a modest measure—modest both in length and purpose. We make no apologies for that. We have not sought in the Bill to reconstruct industrial relations, nor to do everything that needs to be done in the field of industrial relations.

The Bill concentrates on a number of specific abuses and problems where the need for change is overwhelming. I believe what has emerged is a reasonable, fair and just set of proposals. The Bill before us is a further step in a continuing process of moulding our lives, our law and our practices in the constantly changing society in which we live, and of trying to give justice to the individual, while recognising the need for collective effort and collective organisation. It shifts the balance just a little bit between the rights of trade unions and the rights of individuals—and that means everyone who works and lives in our society.

What is society about? It is about people. That is what trade unions are about too. It is only the enterprise of human beings which creates the success of a country. It is the enterprise of human beings which creates the success of a business or of a home. Most people want a contented place of work, which in turn helps to create a contented home. Most people want a contented country. Contentment frequently breeds success, and success frequently breeds contentment. It is not the law which determines the achievement but it is man, and man's relationship with man, and man's respect for man. It is to enhance this just a little that this Bill aims. It is for that reason that I hope your Lordships will give it a Second Reading.

On Question, Bill read a second time, and committed to a Committee of the Whole House.