Trade Union Reform and Employment Rights Bill

HL Deb 26 April 1993 vol 545 cc11-72

3.10 p.m.

Report received.

Clause 1 [Election scrutineer to check register]:

The Parliamentary Under-Secretary of State, Department of Employment (Viscount Ullswater) moved Amendment No. 1: Page 2, line 27, after ("day") insert ("before the day").

The noble Viscount said: My Lords, I must say that it is pleasant to start the proceedings with a government amendment that not only reflects the view that the noble Lord, Lord Wedderburn, expressed in Committee on the subject but, indeed, one that replicates exactly the wording used in the amendment he tabled at that stage.

As noble Lords will be aware, Clause 1 of the Bill provides that the terms of appointment of a scrutineer appointed to oversee the conduct of a union election ballot must enable him to inspect the union membership register either of his own volition or in response to a request made by a union member or candidate during the "appropriate period". The appropriate period is defined in the clause as the period beginning with the first day on which an individual may become a candidate (or on the scrutineer's appointment, if later), and ending with the day on which the scrutineer makes his report to the union. Schedule 1 and Clause 4 make identical provision in respect of political fund and merger ballots respectively.

The noble Lord, Lord Wedderburn, tabled an amendment in Committee to provide instead that the appropriate period would end on the day before the day on which the report is submitted. At the time I accepted his argument, widely supported in this Chamber, that the scrutineer might need a final day in which to complete his report, free of the obligation to consider any requests to inspect the register on which he would then be obliged to report.

We certainly wish to ensure that the scrutineer's report could not be continually delayed by late requests, possibly even mischievous ones, from members. I think that the amendments meet the concerns expressed by noble Lords in Committee. I beg to move.

Lord McCarthy

My Lords, on behalf of those of us on this side of the House I should like to thank the noble Viscount for tabling the amendments. As he said, they are precisely what my noble friend moved in Committee. I do not know whether this is a complete and utter precedent in the 12 years in which we have followed such Bills. However, it comes fairly close to it. Let us hope that it is an encouraging sign for what will follow during the rest of the week because, of course, all our amendments are equally reasonable.

Lord Rochester

My Lords, I too am glad that the noble Viscount has been as good as his word in moving the amendment and in meeting the very valid point made by the noble Lord, Lord Wedderburn. I welcome the amendment.

Lord Wedderburn of Charlton

My Lords, I should like very briefly to thank the Minister. Like my noble friend, I hope that this is how we will proceed for the rest of the afternoon.

Viscount Ullswater

My Lords, I am grateful for the comments of all noble Lords. I commend the amendments to the House.

On Question, amendment agreed to.

Schedule 1 [Political fund ballots]:

Viscount Ullswater moved Amendment No. 2: Page 67, line 42, after ("day") insert ("before the day").

On Question, amendment agreed to.

Clause 4 [Ballots for union amalgamations and transfers of engagements]:

Viscount Ullswater moved Amendment No. 3: Page 6, line 34, after ("day") insert ("before the day").

On Question, amendment agreed to.

Clause 5 [Ballots for union amalgamations and transfers of engagements: notice and voting papers not to include influential material]:

Baroness Turner of Camden moved Amendment No. 4: Page 11, line 24, at end insert ("but may be accompanied by a statement, not exceeding 200 words, explaining the main provisions of the Instrument of Transfer or Amalgamation.

The noble Baroness said: My Lords, as noble Lords will recall, Clause 5 says that when a union ballots its members on a merger or a transfer of engagements it may not send anything else with the voting paper. We discussed the clause very carefully in Committee and we on this side sought, unsuccessfully, to move an amendment which would at least let the members of a union know what their leadership thought about a proposed merger at the time that the ballot papers were sent out.

As we know, the clause was added to the Bill at a very late stage. It apparently arose because some complaints were made by, I think, only three people in the recent ballot to form Unison, the new public sector union. The individuals do not appear to have utilised the procedures open to them of appealing to the certification officer, but simply complained to their MP. On that very slender basis, the Government proposed to legislate.

On Second Reading, I said that when I first saw the clause I thought that the Government had gone a bit dotty. That is still my view. I cannot see why it should be regarded as some kind of right that information should be withheld from members unless the union agrees to double the expenditure in which it is being involved in carrying out the ballot in the first place. We were told by the Minister in Committee that there was nothing to prevent a union sending out material so long as it does not go with the voting papers themselves. But it is at the point of voting that people actually want information.

Moreover, I can recall the intervention by the noble Earl, Lord Harrowby, at col. 1388 of Hansard in Committee on 16th March, when he pointed out that members of Lloyd's frequently receive sheaves of papers and voting papers in the same envelope".

The case is similar with trustees. I am a trustee of a small scheme and recently voted on a change of rules. In the same envelope, and perfectly properly, I received information about the background plus a resolution which had been approved by a meeting of members.

I do not understand why it is necessary to treat unions so differently—although perhaps I do. In the years that I have spent in your Lordships' House, and looking back at previous Bills with which I have been involved, I have come to understand that there is a basic hostility towards anything to do with unions. It seems to me that the Government want to make life as difficult for them as possible. Of course, one means of doing so is continually to introduce legislation on the slightest pretext which will make union administration more complex, difficult and also more expensive.

Another way is to prevent unions becoming stronger. One of the ways in which unions have been strengthening their position during the recession has been by amalgamation. At one time, all the pundits, including those on the government side, seemed to think that that was a good idea. But, again, along come the Government equipped with three complaints to an MP attempting once again to change the law. I should have thought that three was not significant, given the thousands of members who participated in the Unison ballot.

We failed in Committee with what I thought was a reasonable amendment. But I still believe that even if members do not go to conferences, attend their branch meetings or read their journals, they are entitled to vote and to do so on the basis of a reasonable amount of information. Even the noble Lord, Lord Boyd-Carpenter, seemed to accept that view in Committee. He said that union members, should receive a clear, clean statement of what they are voting on".—[Official Report, 16/3/93; col. 1386.] He continued to say that the statement should not be able to be construed as advising them to vote one way or the other. So, despite our strong objections to the clause itself, we have come back with what I think is a minimalist approach. The amendment says that voting papers, may be accompanied by a statement, not exceeding 200 words, explaining [in simple terms] the main provisions of the Instrument of Transfer or Amalgamation". Surely the Government would not object to that. In any event, as I understand it, the material has to be approved by the certification officer before it is issued. It would be a very bad thing if, as a result of the clause in the Bill, future mergers were to be voted upon by sections of the membership who had little idea what it was all about. I beg to move.

Lord Rochester

My Lords, for the life of me I cannot see why, in principle, companies and trade unions should be treated in different ways in this respect. When company shareholders are invited to vote on a major matter, the view of their board of directors is sent to them along with any voting paper. Why should unions be treated differently? It seems to me, as it does to the noble Baroness, Lady Turner, that Clause 5 is yet another example of punitive legislation imposed on trade unions which does not apply to other organisations. I say "punitive" because of the very considerable additional expenditure which is involved in having to send out two sets of papers where one would suffice.

When compared with the voluminous material to which company shareholders are subjected in similar circumstances, the amendment asks for very little. By confining any statement that may accompany the voting paper to no more than 200 words, the amendment seeks out a compromise with the Government which I hope the Minister will accept.

Lord Wedderburn of Charlton

My Lords, the noble Lord, Lord Rochester, anticipated my mentioning this point. I support the argument that this is yet another case where that which is allowed to companies, however large or small, is not allowed to trade unions for no good reason at all. However, I pass over that point to a further point. The history of trade union law since 1980 does not make it unreasonable occasionally to wonder what will follow a particular Bill which is before your Lordships' House. One wonders whether the Government's argument does not allow for the next Bill to include a provision that there should not be one-sided material presented, at any rate at the time of the vote or somewhat before, in trade union decisions.

On Report in another place the Minister of State said that the principle was, that one-sided material should not go to members when the ballot papers are sent out". That summarises the Government's argument. The Minister of State continued: Surely the hon. Gentleman can see that it is difficult to understand why the union's view should be presented again at the final stage, when people are asked to vote in the ballot". —[Official Report, Commons, 16/2/93; col. 161.] The final stage is not necessarily confined to the day of the ballot. It might be argued that the final stage is the final stage of the argument. Why does that principle not also apply to elections if one is to deal with organisations in this arbitrary manner? It could apply to decisions of all kinds at the final stage. Are the Government giving us a Bill which states that in the period before a trade union ballot on an important matter one sided material is not allowed? I know the Minister will say that that is not what the Government are promoting on this occasion. However, since 1982 every Bill that has been passed on this matter has contained a raised flag on what is to follow. Unless the Minister can give us an assurance that this principle will not be applied elsewhere in trade union law, your Lordships should draw the conclusion that that may well occur. On that basis the modest amendment of my noble friend should surely be supported.

Lord Boyd-Carpenter

My Lords, as has already been pointed out, I expressed some doubts about this matter at a previous stage. This is a difficult issue. On the one hand, it seems not unreasonable that the notice of the decision to be taken should be accompanied by some information about it. On the other hand, as the Bill now stands, that statement could be biased very much in one direction or another. As I understand it, there is no provision in the Bill to prevent a biased or not wholly subjective statement being included. The trouble with this is that in 200 words anyone could state a powerful argument in favour of either one side or the other. Although I sympathise with the desire on the part of the union to avoid having to submit a separate statement, I see real difficulty with this amendment in as much as it would provide an opportunity for a wholly argumentative, non-objective point to be put in favour or against the proposal. In 200 words one can do quite a lot. The provision would not secure that the statement was the objective statement which I believe most of your Lordships would like to see included.

Lord Murray of Epping Forest

My Lords, unless the Government actually regard inconsistency as a possible virtue—I should not have thought they did—surely they will accept this amendment as being not only desirable on merit, as has been said, but also as being totally and absolutely consistent with much of the legislation on trade unions which has preceded this Bill over the past 10 years. We have been told again and again by the Government Front Bench that one of the main purposes in this great sweep or thrust of legislation has been to ensure that trade unionists are properly informed so they can be fully in control of decisions which are made in their name. That has been the doctrine that has been quite properly enunciated from the Government Front Bench. Surely it is only consistent with that that the membership should be informed of what is happening and of the reason that the proposals are being put forward. The argument that the membership should be deliberately kept in the dark sits ill with that idea. The Minister shakes his head. I am glad to have the assurance that it is not the intention to keep the membership in the dark. I believe the Government's intention should be to illuminate the membership on the decisions they have to take. That is the case we seek to make.

A point which the Government have consistently made in discussing legislation of this kind is the need to use the resources and the financial provisions of members of trade unions effectively and efficiently and to prevent waste. Again this amendment would serve that purpose. Further, the Government have said they seek to improve industrial relations. The main purposes of mergers and transfers of the kind we are discussing are to use the resources of members more efficiently and more effectively; to spend their money more carefully and more effectively; and to reduce unnecessary competition at the expense of employers at the workplace. On all these grounds I should have thought the Minister would have been disposed to recognise the value and the virtues of this amendment and to accept it.

Lord Mottistone

My Lords, instead of pursuing this argument, would not a union do better to leak the 200 words to the press? The members would probably be far keener to read the statement if it appeared in the press than if the statement were posted to them in an envelope with the voting papers. I am more inclined to read what is in the press on company issues than a long argument produced by the chairman of some company. I should have thought the position would be much simpler if that were done. The unions would have to leak the information of course; otherwise the press might not pick it up.

Baroness Seear

My Lords, that is a most extraordinary suggestion from the noble Lord, Lord Mottistone. Does he really think that the press, which is largely anti-union, will present a case which will be seen to be fair, even if it is—one must have doubts about that—and one that will be believed by trade union members? I should think the most likely effect of such a process would be to make union members vote the.other way. However, that remains to be seen. Will the noble Viscount explain why the matter we are discussing is not a good step for unions to take when everyone else may take it? That is what strikes so many of us as being vindictive against unions. I believe I have said previously when discussing this Bill that there is a strong feeling among those who have supported previous legislation that this Bill is out to get the unions. If the Minister wishes to disabuse us of that idea, will he explain why a step which every other organisation is allowed to take is not to be permitted to unions? They are to be obliged to do something which will place a heavy burden upon their already restricted resources. If he cannot convince us on this matter, that is yet further evidence that the purpose of the legislation is totally to undermine unions. I fail to see how one can obtain good industrial relations if one does that.

3.30 p.m.

Lord Blease

My Lords, I was interested to hear the remarks of the noble Lord, Lord Boyd-Carpenter. It appeared to me that he was in total agreement with the principles contained in the amendment. However, I believe he suggested that a statement of 200 words was too lengthy. Would 150 or 100 words be more acceptable to the noble Lord?

Viscount Ullswater

My Lords, I am grateful to all noble Lords who have taken part in the debate, and especially to the noble Baroness, Lady Turner, for her explanation of the aims of the amendment. The fact that noble Lords opposite divided the House twice on issues connected with Clause 5 left us in no doubt of their resistance to its provisions.

Union members entitled to vote in a merger ballot will, of course, always receive a notice about the ballot, approved by the independent certification officer, with the voting papers. Provisions in paragraph 55 of Schedule 7 to the Bill will ensure that, in future, such notice must go out with the voting papers for a merger ballot. In deciding on the form of notice on which it will seek the certification officer's approval, the law will continue to give unions a choice.

The union may opt for a notice setting out, in full, the instrument of amalgamation or transfer for which the ballot seeks approval. Alternatively, it may seek the certification officer's approval for a notice giving an account of the instrument, as set out in Section 99(2) (b) of the 1992 Act: sufficient to enable those receiving the notice to form a reasonable judgment of the main effects of the proposed amalgamation or transfer". Therefore, I cannot accept the comments of the noble Lord, Lord Murray of Epping Forest. We are not trying to prevent union members from knowing all that is going on or keeping them in the dark.

Such an account would certainly cover what the amendment describes as "the main provisions" of the instrument. It would probably have to do more, if that was necessary in the view of the certification officer, to give the union's members a sufficient account of the main effects of the amalgamation or transfer. The point is that if a union believes that that is a better way to proceed than by sending out a copy of the full instrument—and my noble friend Lord Mottistone will have views on that—it is, and will continue to be, free to seek the certification officer's approval for such an account.

The noble Lord, Lord Wedderburn, mentioned election ballots in his arguments in support of the amendment. Union merger ballots are quite different from union election ballots. Quite obviously, the question at issue is completely different. Merger ballots concern the very future existence of the union. That is the point at issue and that is what I should like to draw to the attention of the noble Baroness, Lady Seear. On the other hand, election ballots, and the different law which relates to them, concern a choice between individuals competing to hold union office. The analogy is not a good one. Just because the law requires candidates' addresses to be sent out with election ballot voting papers, that is no argument for saying that there must be some broadly equivalent arrangements for merger ballots. The law already applies in quite different ways in respect of those ballots.

For example, there is nothing even remotely equivalent in the law on union elections to the arrangements which have always applied for the certification officer to approve the notice about a merger ballot. Indeed, it is difficult to see what the basis of an analogy could be. Perhaps it might involve the certification officer considering whether the candidate in an election really meant what he said in his address. I can assure your Lordships that we have no plans for such requirements.

Lord Wedderburn of Charlton

My Lords, I am grateful to the Minister for giving way. Taking all of the argument which he has put to us, does it not appear odd that at that final stage, when the very existence of the union is at stake, as the noble Viscount put it, the law will permit material to be sent in a different envelope from that in which the Government had refused to allow it to be included?

Viscount Ullswater

My Lords, no. I do not know whether the noble Lord is in order in raising a different point. If the union wishes to persuade its members how to vote I do not believe that that should be within the scope of this law. That is why we suggest that the statement should be sent without such persuasive literature.

I appreciate that the noble Baroness in particular and other noble Lords who have spoken stressed that the amendment aims at only a limited and modest change to the provisions in the proposed new Section 99(3A). I have given careful consideration to the possibility that we should allow some additional explanatory statement relating to the instrument of amalgamation or transfer which is the subject of the ballot to be sent out with voting papers. However, as I have explained, I have concluded that there is no need for that, given the nature of the law relating to the notice which will be allowed to accompany the voting papers. I agree with the noble Lord, Lord Boyd-Carpenter, that we have the right balance in the Bill. Therefore I hope that the noble Baroness will withdraw the amendment.

Baroness Robson of Kiddington

My Lords, I am not a leading participant in this debate but I have been listening to it very carefully. The noble Viscount stated that no persuasive literature must go out on the question of a merger between two trade unions. To take the analogy used by my noble friend Lord Rochester, when I receive a merger proposal from a company in which I happen to be a shareholder I am sent the most persuasive arguments to make me vote one way or the other. I cannot see the difference.

Viscount Ullswater

My Lords, the difference is quite clear. The law relating to trade unions and the law relating to companies is quite different, quite distinct and needs to be treated differently because of the nature of the two different identities.

Lord McCarthy

My Lords, this is precisely what we are always asking the noble Viscount. He says that the law is different. We know that the law is different. We are asking him why the law is different. He never gives us a reason why when, as he says, the future existence of the union is at stake the executive and democratically elected leaders of the union are not allowed to put their point of view whereas the person who is involved in a takeover is allowed to put his point of view. What is the difference which justifies the law?

Viscount Ullswater

My Lords, I believe that I have answered that point succinctly.

Lord Murray of Epping Forest

My Lords, perhaps I may clarify one point.

Lord Mottistone

Order! This is Report stage and one cannot clarify a point. One can ask a question. I believe that if noble Lords look at the rules of the game they will find that that is the case. Therefore, if the noble Lord restricted himself to a question rather than a clarification it would be better.

Lord Murray of Epping Forest

My Lords, I am indebted to the noble Lord for drawing to the attention of your Lordships the fact that a question is pending at any second now. This is my question. Will the Minister clarify the impression that he has given that the Government do not object to a letter containing advice or a view arriving through the same letter box in the same post, in a different envelope, with a different stamp onto the same table of the same member, but he does object to one letter containing all the material arriving through the letter box in one envelope and with one stamp? Does he see a real distinction between those two things?

Viscount Ullswater

My Lords, with the leave of the House, my answer to that question is that the law requires that a notice should accompany the ballot paper. It does not require that such other additional material should be sent. That is entirely for the union to decide.

Lord Murray of Epping Forest

My Lords, but does he object? That is my question.

Baroness Turner of Camden

My Lords, I am rather disappointed with the way in which the Minister responded. As I made clear when moving the amendment, this is a minimalist amendment. We have tried to deal with the arguments advanced by the Minister when we put a different amendment at Committee stage. In the drafting of the amendment I tried to address the argument put by the noble Lord, Lord Boyd-Carpenter, to the effect that members should receive a clear statement but should not receive persuasive literature. Indeed the amendment simply says that the ballot paper: may be accompanied by a statement, not exceeding 200 words, explaining the main provisions of the Instrument of Transfer or Amalgamation". The Minister said that together with the voting paper it would be possible to send either a full copy of the instrument, which is usually a legalistic document, or a statement which will cover the main points of the instrument, in consultation with the certification officer. That I understand. On the other hand, surely in the case of a merger one would wish the individual members to receive the actual legal document, even if they do not always read it. In addition, they should receive a summary which would set out simply the main provisions.

I do not believe that the Minister has adequately replied to the points put from this side of the House. I am not satisfied. He has produced no valid arguments for trade unions being governed differently from companies under the law covering mergers or takeovers. Surely the arguments are similar for unions. The identity and existence of the organisation may be at stake. In both instances, the member and the shareholder are entitled to have similar considerations. However, with regard to trade unions we have different and, I believe, much more punitive legislation.

I should have thought that the Government would wish to do everything possible to encourage mergers between unions. It is not so long since the German trade union movement was being held up to us in Britain as an example. We were told that we had far too many unions. Since those days the unions have made a substantial attempt to reduce their number through merger and amalgamation. They have had some success. However, the legislation now being introduced seems to me to run counter to that trend. I believe that it is not to the advantage of either the unions or their members.

Nevertheless, it is not my intention to press the amendment to a vote. When the provision is on the statute book we shall have to consider how best it can be applied in union terms. The unions will have to work out how best they can continue to ensure that their members are kept fully informed of potential mergers and transfers of engagements. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 6 [Confidentiality of trade union's register of members' names and addresses]:

Viscount Ullswater moved Amendment No. 5: Page 12, line 4, at end insert: ("and any reference in this Act to "the duty of confidentiality" is a reference to the duty prescribed in this subsection.").

The noble Viscount said: My Lords, in moving Amendment No. 5, I speak also to Amendments Nos. 103 and 104. These are minor technical amendments which we believe will make the provision to be inserted by the Bill into the 1992 Act more easily understood.

As noble Lords will be aware, Clause 6 requires a trade union to impose a duty of confidentiality on any scrutineer or independent person whom it appoints to oversee certain ballots. Even if the union fails to observe this duty, however, it is automatically incorporated into the terms of the appointment of the scrutineer or independent person by references to be introduced at appropriate points in the 1992 Act by this Bill.

It seems that those references to an incorporation of a duty of confidentiality, as currently set out in the Bill, have caused some puzzlement. The amendments therefore make it clear that any reference to a duty of confidentiality is a reference to the duty defined under Section 24A(3) to be inserted by Clause 6: I trust that your Lordships will agree that it is helpful to clarify matters in this way. I beg to move.

3.45 p.m.

Baroness Turner of Camden

My Lords, I thank the Minister for that explanation. In the circumstances, we do not offer any opposition to the amendment.

On Question, amendment agreed to.

Clause 7 [Ballots: repeal of provisions for financial assistance and use of employers' premises]:

Lord McCarthy moved Amendment No. 6: Page 12, line 34, after ("116") insert ("except in regard to elections carried out in accordance with 115(2) (b))").

The noble Lord said: My Lords, we now turn to Clause 7 which, as the House knows, deals with the repeal of the scheme for financial assistance to unions in relation to ballots. The objective of the clause is to deny unions any form of assistance to pay for what are now legally imposed ballots, all of which have to be postal. The amendment makes one exception to the general repeal in relation to election ballots. We do not suggest that there should be any money in future for strike ballots, although they now have to be postal, or for ballots about rule changes, political funds, amalgamations or, to use that strange phrase in the consolidation Act, "any other purpose". We simply provide that in the case of election ballots the provisions that exist should remain in place.

We put forward the amendment following the arguments advanced by the Government and their supporters both in this House and in another place for what they were doing. For example, the spokesman for the Government stated on 16th February, at col. 162 of the Official Report in another place, that the clause is there because of the widespread and well accepted scheme which does not merit a continued subsidy. In other words, the fact that the scheme is widespread and well accepted means that it does not merit a continued subsidy. We have never been able to understand that argument. Indeed, the Government had difficulty in explaining it and elaborating upon it. They subsequently came forward with another explanation. At col. 163, the Minister stated that they were abolishing the scheme because it was not justified to give public money to subsidise strikes. He stated: We have to decide between using public funds to subsidise ballots on strike action or … other worthy causes". In seeking to follow the arguments of the Government, the House will remember that at Committee stage we moved an amendment to take out the word "strikes". At that point the Minister put forward another two reasons. On 16th March, at col. 1404 of the Official Report, he stated that there was no case to continue a scheme because it was created as an incentive to postal balloting when the practice was not statutory. In other words, because it has become statutory —there is no option and no alternative—the unions should be denied the money. He also stated that the Government had already decided to phase out the scheme and to provide no more Treasury money in three years' time. In other words, they were already into that process. They therefore could not take notice of our amendment because it was too late.

I suggest that those arguments do not add up to a consistent case. It is not an argument for abolishing a scheme because it is working well. It is not an argument for abolishing a scheme because one is extending the burden, with full postal voting on amalgamations, strikes, and so on. It is not a case for abolishing a scheme that the Government have decided to phase out the mechanism. What they can phase out they can phase in. Therefore we now seek to persuade the Government to accept that there is a case for continuing the scheme in one particular respect. The election element is the most costly single factor in the process of balloting. The number of elections in unions, for the most part imposed as a result of legislation, has become the single most expensive form of balloting. It is no secret that the bulk of the £4.2 million which the Government gave unions last year was spent on election ballots. Election ballots now cost unions more than £5 million a year. Most of that cost is imposed upon them by the Government. Therefore we say that the least the Government can do in those circumstances is to honour the pledge that they made in 1980 to fund some of the costs of those ballots. Most people would suggest about 50 per cent. of the cost. Therefore, it will still cost unions several million pounds a year to come into line with the Government's own requirements. I beg to move.

Lord Rochester

My Lords, I have put my name to the amendment. When a somewhat similar provision was debated in Committee, I deplored the fact that this clause of the Bill was introduced at Report stage in another place without any prior consultation. In reply the noble Viscount, Lord Ullswater, told me that the decision to phase out financial assistance for union ballots was taken in the wake of the public expenditure settlement last autumn; and that, given the claims on that expenditure, funds for union ballots could no longer be justified. Yet at the same time as funding is to be phased out, under the Bill unions are to be obliged to spend even more on ballots. In future virtually all ballots are to be postal and subject to independent scrutiny. That caused me to say at Second Reading that the Government's decision smacked of a certain meanness. I continue to have that feeling.

The amendment does not seek to overturn the clause altogether, but simply to limit continued government funding so that it applies, as the noble Lord, Lord McCarthy, said, only to ballots for the election of union officers or representatives. Those are ballots which trade unions are under a statutory duty to hold at periodic intervals. They account for a large part of the expenditure on the totality of ballots. It seems to me reasonable that, in holding such ballots, unions should continue to receive some financial assistance. I therefore support the amendment.

Lord Boyd-Carpenter

My Lords, I wonder whether my noble friend the Minister can tell noble Lords what amount of public money is involved. If this amendment were to be accepted, what would be the total cost?

Lord Wedderburn of Charlton

My Lords, before the Minister answers that question, I should like to support my noble friend in moving this very important amendment. It is my belief that the historian will find that the Government are in breach of promise and in breach of faith in this matter. I exempt the Minister, who was not around when the turn of policy came. But now he comes, as it were, to finish it off.

In 1980 it was said that there should be more secret postal ballots, financed in great part through public funds. I believe that my noble friend is right in saying that that is now done to the extent of some £4 million to £5 million a year.

Perhaps I may quote the noble Earl, Lord Gowrie, who said on 20th May 1980, which is where the story begins: The provision of public funds for secret postal ballots has been widely welcomed as following best existing practice of many trade unions and as part of our overall aim of encouraging greater participation by rank-and-file members of unions". [Official Report, 20/5/80; col. 740.] That policy was followed in the teeth of divided trade union counsels. There were many who said: "Don't trust it. Don't take the money". But gradually more money came forward, and it is the tendency of mankind, shared perhaps by companies and trade union leaders, to take money when it is offered. The money was taken, and is being taken. At the same time the Government made more ballots compulsory; and then made more compulsory ballots postal. So one reaches the point now where the breach is finalised; namely, the law is pushed forward to include more postal ballots which are obligatory on the trade union, and in the next two years or so the money is to be taken away. Against that picture my noble friend's amendment is modest indeed. I have spared noble Lords the detail of the history, partly because I am sure that all noble Lords know very well that that outline is correct. I support the amendment.

Lord Stoddart of Swindon

My Lords, I too support the amendment on very much the same grounds as those stated by my noble friend Lord Wedderburn of Charlton. There is no doubt at all that the unions have been duped. Indeed, the Government would have had a great deal more trouble in introducing their provisions for compulsory postal ballots had the bitter pill not been sweetened by some financial assistance. The Government did not then say that there was a time limit on that particular form of assistance. They did not make it absolutely clear that there would be a further Bill which would remove the financial assistance. But now we have such a Bill. One cannot help believing very seriously that it is the intention of the Government, in spite of their protestations, to undermine the trade union movement through financial means. This particular provision will cost the trade unions dear—and many of them are in dire financial straits at the present time—for having to do things which are imposed upon them statutorily by Parliament, by the Government. At the behest of the Government, in large measure they will have to use their funds to do things in which they do not believe.

However, there is another catch in the Bill. There is another provision which will hurt the trade unions very much if the Government have their way. That is contained in Clause 14, where in my view the Government deliberately set out to wean people away, perhaps by default, by persuading people that they need not pay the trade union subscription every week. So the Government are getting at the trade unions in two ways. First, they are increasing their expenditure, which they promised not to do; then, at the same time, in the same Bill, they are doing their best to undermine the income of the trade unions. I believe that through this Bill, the Government show their animosity towards the trade union movement, and show perfectly well that, in spite of the fact that they have said they believe in a strong democratic trade union movement, they do not believe in the trade union movement at all. As I have said before, the only reason that they tolerate the trade union movement is that in some instances trade unions are administrative conveniences for the employers.

Baroness Denton of Wakefield

My Lords, I thank the noble Lord, Lord McCarthy, for his explanation of the thinking behind the amendment. But, like the related amendment that was tabled and debated in Committee, I am afraid that it remains unacceptable to the Government.

Perhaps I may start my remarks by answering my noble friend Lord Boyd-Carpenter, who asked for the costs incurred under the scheme. In 1991 the certification officer made payments totalling over £4 million to 77 unions. In 1992 a similar amount was paid to 80 unions. Amounts paid range from as much as over £1 million to the Transport and General Workers' Union to as little as £315 to the National and Provincial Building Society Staff Association. The amount of money that a union receives depends on the extent to which the union holds ballots and incurs expenditure which can be refunded under the terms of the scheme. It also depends on whether the union chooses to apply for refunds. Some unions do not.

Clause 7 repeals Sections 115 and 116 of the Trade Union and Labour Relations (Consolidation) Act 1992. Section 115 empowers the Secretary of State to establish a scheme under which payments may be made to trade unions in respect of certain postal ballots. It will become obsolete once the trade union ballot funding scheme which the certification officer currently administers has been phased out in 1996, and we are therefore using the opportunity afforded by this Bill to repeal it. Section 116 is defined in terms of Section 115. Without either Section 115 or the scheme, it will become meaningless. It therefore makes sense that it too should be repealed.

The noble Lord made it clear that the main intention behind the amendment is that a ballot funding scheme should continue to exist in respect of union elections. As we emphasised in Committee, Clause 7 has no effect on whether or not the existing trade union ballot funding scheme is phased out. That decision was taken quite separately and is being implemented by a statutory instrument which came into effect on 1st April. Clause 7 simply repeals the power to establish such a scheme, a power that is clearly becoming redundant now that the Secretary of State has decided that it is no longer right or an appropriate use of public funds for such a scheme to operate.

It may be helpful if I set out once again the reasons for phasing out the trade union ballot funding scheme. The scheme was introduced in 1980 to encourage the voluntary practice of secret balloting at a time when there were no statutory requirements for unions to ballot their members before calling strikes or when electing leaders. Since 1984 such ballots have been a legal requirement. The original objectives of the scheme are no longer relevant and it now largely operates as a government subsidy for ballots which unions are required to carry out by law.

4 p.m.

Lord Stoddart of Swindon

My Lords, I wonder whether the noble Baroness can answer one question. When the provision for financial assistance for postal ballots was introduced in 1980, was it made clear at that time that the assistance was only temporary and not permanent?

Baroness Denton of Wakefield

My Lords, in 1980 the scheme was to encourage balloting. Indeed, it is surprising that the Trades Union Congress boycotted the scheme until 1985. I understand that it almost expelled two unions for using the scheme. Since 1986, unions have been allowed by the Trades Union Congress to use the scheme. It never welcomed the scheme. The issue is not the cost. That was dealt with by the statutory instrument that phased out the trade union ballot funding scheme. This clause takes out unnecessary legislation.

Lord Stoddart of Swindon

My Lords, I am most obliged to the noble Baroness for trying to answer my question but I fear that she has not done so. Will she please answer it? In 1980 when the scheme was introduced, was it introduced on the basis that it would be or could be phased out at some point in the future? Was it made clear to the trade unions—never mind about the Trades Union Congress, which is not concerned here since this involved financial assistance to individual trade unions and not to the Trades Union Congress—that it could be phased out, or was the impression given that it was introduced on a permanent basis?

Baroness Denton of Wakefield

My Lords, it was never indicated that the funding was permanent. The purpose of the scheme was to encourage balloting. That is now a legal requirement.

Lord Wedderburn of Charlton

My Lords, as the noble Baroness has said that there was no such indication from the Government, can she say why the Secretary of State made the following comment? In a major speech that he made on the issue of postal ballots in December 1979, he told the trade unions: if you are thinking of having one, you do not have to worry about the cost, for the taxpayer will reimburse you".—[Official Report, Commons, 17/12/79; col. 165.] I do not select those words out of context. There is nothing in the context to suggest a limitation as to time.

Baroness Denton of Wakefield

My Lords, the issue then was the availability of the funding to encourage balloting. Balloting is now required by law.

Lord Stoddart of Swindon

My Lords, perhaps I may just try again.

Lord Howie of Troon

My Lords, I wonder whether the noble Baroness would make it clear whether or not it was presented to this House—not to any outside body—that this funding was a temporary measure? In my recollection it was not, but I may be wrong.

Baroness Denton of Wakefield

My Lords, let me once more repeat for the benefit of the noble Lord, that it was not presented as a permanent measure.

Lord Howie of Troon

My Lords, was it presented as a temporary measure?

Lord Harmar-Nicholls

My Lords, perhaps I may ask my noble friend what legislation is permanent, in the sense that this House, if it so wishes cannot vary it at a later stage in the light of new circumstances? The noble Lord's question is irrelevant in the context of the powers of Parliament itself.

Baroness Denton of Wakefield

My Lords, I thank my noble friend for drawing attention to the real position of legislation. I return to the clause to which the amendment of the noble Lord, Lord McCarthy, applies. I stress that the scheme is being abolished because it no longer represents a justified use of public money. That applies to all and any ballot that it funds. Trade union ballots can and should be funded by trade unions, not by the taxpayer.

The Government cannot accept the amendment. I hope that the noble Lord will withdraw it.

Lord McCarthy

My Lords, with respect, the noble Baroness has a genius for non-justification. It is no answer to say that we abolished this because we abolished something else. We have phased out the scheme and you cannot ask us to explain or defend it because we have done it. That is like saying that we have switched off the life support machine and it is done now; you are dead. Do not ask why. We have done it. Of course the Government can switch the machine back on again. They know that. We are asking them why they do not do so. It is not even true to say that they did it before they published the Bill. The Bill was published before they abolished the scheme. The Bill was published in November 1992. In explaining the Bill, the Government said that they were going to abolish the scheme. The trade unions complained and asked for an explanation. They have not been given an explanation today. It is no answer to say, "We did it to encourage balloting and now that balloting has been encouraged, we do not need to do it any more." Balloting is taking place and it still costs money. It was because it cost money that Mr. Prior (who is now the noble Lord, Lord Prior) introduced the scheme in the first place. It is no justification to say that the scheme is being abolished because it was introduced as an encouragement to do something—to encourage us to be good boys and girls—.and then to say, "You are such excellent boys and girls that we shall take away the money." That is no justification.

My noble friend Lord Wedderburn is absolutely right. A promise was made. It was not made in so many words on the Floor of the House but it is well known—I wish that the noble Lord, Lord Prior, was in his place—that the then Minister wanted to encourage trade unions to engage in balloting. In fact he had friends in the trade unions and knew what they wanted and felt about these matters. Those friends said to him, "Yes, we would like to have ballots, Jim, but they are very expensive." He said, "Don't worry. Leave it with me. I'll do something about that." He did something and now, because it has been successful, the Government are taking it away.

It is no excuse to say, "You are all doing it." Every time the Government bring a Bill to this House it adds to the cost. This adds to the cost while taking away the means of paying the cost. I have explained to the House before what additional costs will be incurred by trade unions to deal with the additional functions placed on scrutineers for the surveillance and extension of elections. Even general secretaries and presidents who do not have votes have to be regularly elected. That costs unions more than £100,000 and £150,000 a year—all done by the Government. There is no justification for taking away that support. It constitutes a breach of faith and we intend to divide the House.

4.10 p.m.

On Question, Whether the said amendment (No. 6) shall be agreed to?

Their Lordships divided: Contents, 87; Not-Contents 131.

Division No. 1
CONTENTS
Addington, L.	Bruce of Donington, L.
Ardwick, L.	Carmichael of Kelvingrove, L
Ashley of Stoke, L.	Carter, L.
Aylestone, L.	Cledwyn of Penrhos, L.
Beaumont of Whitley, L.	Cocks of Hartcliffe, L.
Blease, L.	Dean of Beswick, L.
Bonham-Carter, L.	Desai, L.
Boston of Faversham, L.	Dormand of Easington, L.
Bottomley, L.	Ennals, L.

Ezra, L.	Merlyn-Rees, L.
Falkland, V.	Mishcon, L.
Fisher of Rednal, B.	Molloy, L.
Fitt, L.	Morris of Castle Morris, L.
Gallacher, L.	Mulley, L.
Galpern, L.	Murray of Epping Forest, L.
Geraint, L.	Nicol, B.
Gladwyn, L.	Northfield, L.
Graham of Edmonton, L. [Teller.]	Ogmore, L.
	Pitt of Hampstead, L.
Greene of Harrow Weald, L.	Plant of Highfield, L.
Gregson, L.	Ponsonby of Shulbrede, L.
Grey, E. [Teller.]	Prys-Davies, L.
Hampton, L.	Richard, L.
Hanworth, V.	Robson of Kiddington, B.
Harris of Greenwich, L.	Rochester, L.
Hilton of Eggardon, B.	Sainsbury, L.
Hirshfield, L.	Seear, B.
Hollis of Heigham, B.	Sefton of Garston, L.
Holme of Cheltenham, L.	Serota, B.
Howie of Troon, L.	Shackleton, L.
Hughes, L.	Stallard, L.
Jay, L.	Stoddart of Swindon, L.
Jay of Paddington, B.	Strabolgi, L.
Jeger, B.	Taylor of Blackburn, L.
Jenkins of Putney, L.	Taylor of Gryfe, L.
John-Mackie, L.	Thomson of Monifieth, L.
Judd, L.	Tordoff, L.
Kilbracken, L.	Turner of Camden, B.
Lockwood, B.	Wallace of Coslany, L.
Longford, E.	Wedderburn of Charlton, L.
McCarthy, L.	White, B.
Mclntosh of Haringey, L.	Williams of Elvel, L.
Mallalieu, B.	Williams of Mostyn, L.
Mason of Barnsley, L.	Winchilsea and Nottingham, E

NOT-CONTENTS
Aberdare, L.	Elton, L.
Acton, L.	Erroll of Hale, L.
Alexander of Tunis, E.	Faithfull, B.
Allenby of Megiddo, V.	Finsberg, L.
Arran, E.	Flather, B.
Ashbourne, L.	Forbes, L.
Astor of Hever, L.	Fraser of Carmyllie, L.
Auckland, L.	Fraser of Kilmorack, L.
Barber of Tewkesbury, L.	Gainford, L.
Belhaven and Stenton, L.	Gardner of Parkes, B.
Bellwin, L.	Geddes, L.
Bessborough, E.	Gibson-Watt, L.
Blatch, B.	Goschen, V.
Boardman, L.	Halsbury, E.
Borthwick, L.	Harding of Petherton, L.
Boyd-Carpenter, L.	Harmar-Nicholls, L.
Brabazon of Tara, L.	Hayhoe, L.
Braine of Wheatley, L.	Hemphill, L.
Butterworth, L.	Henley, L.
Cadman, L.	Hesketh, L. [Teller.]
Caithness, E.	Hives, L.
Campbell of Croy, L.	Holderness, L.
Carnegy of Lour, B.	HolmPatrick, L.
Carnock, L.	Hood, V.
Chalker of Wallasey, B.	Hooper, B.
Charteris of Amisfield, L.	Hothfield, L.
Chelmsford, V.	Howe, E.
Clark of Kempston, L	Hylton-Foster, B.
Cockfield, L.	Johnston of Rockport, L.
Constantine of Stanmore, L.	Lauderdale, E.
Cox, B.	Lindsay, E.
Cranborne, V.	Lindsey and Abingdon, E.
Cullen of Ashbourne, L.	Liverpool, E.
Cumberlege, B.	Lloyd-George of Dwyfor, E.
Davidson, V.	Long, V.
Denham, L.	Lyell, L.
Denton of Wakefield, B.	Mackay of Ardbrecknish, L.
Dundonald, E.	Mackay of Clashfern, L. [Lord Chancellor.]
Eden of Winton, L.
Effingham, E.	Mancroft, L.
Elles, B.	Margadale, L.
Elliott of Morpeth, L.	Marlesford, L.
Elphinstone, L.	Merrivale, L.

Mersey, V.	St. Davids, V.
Milverton, L.	Saltoun of Abernethy, Ly.
Monteagle of Brandon, L.	Shannon, E.
Mottistone, L.	Sharples, B.
Mountevans, L.	Skelmersdale, L.
Mowbray and Stourton, L.	Slim, V.
Moyne, L.	Stewartby, L.
Munster, E.	Strathclyde, L.
Murton of Lindisfarne, L.	Strathmore and Kinghorne, E. [Teller.]
Nelson, E.
Newall, L.	Sudeley, L.
Norrie, L.	Swansea, L.
Orkney, E.	Terrington, L.
Oxfuird, V.	Teviot, L.
Park of Monmouth, B.	Torrington, V.
Pender, L.	Trumpington, B.
Peyton of Yeovil, L.	Ullswater, V.
Plummer of St. Marylebone, L.	Vaux of Harrowden, L.
Quinton, L.	Vivian, L.
Rankeillour, L.	Wade of Chorlton, L.
Reay, L.	Whitelaw, V.
Rippon of Hexham, L.	Wynford, L.
Rodger of Earlsferry, L.	Young, B.
Rodney, L.

Resolved in the negative, and amendment disagreed to accordingly.

4.18 p.m.

Clause 13 [Right not to be excluded or expelled]:

Baroness Turner moved Amendment No. 7: Page 24, line 45, at end insert:("but does include conduct which is in breach of the rules of the union and which is calculated to impair its position to negotiate with an employer on behalf of its members generally or at the place of work of the individual.").

The noble Baroness said: My Lords, Clause 13 was discussed thoroughly in Committee. It is the clause which removes the right the trade union movement has had for many years to regulate itself under what are called the Bridlington principles. It is one of the most important clauses in the Bill. It is right that we should have spent a lot of time discussing it at Committee stage.

However, we did not succeed in convincing the Committee that the clause as it stands would be damaging to the maintenance or growth of single union deals or that it would be responsible for undermining industrial stability. The clause makes it impossible for a union to refuse admission to an individual whose terms and conditions of employment are governed by a negotiating agreement held with another union, and also makes it impossible to exclude anybody on the same grounds.

As we said in Committee, at the present time the TUC has its own system of regulation. It is a system of self-regulation which, despite the criticisms sometimes made—it would be astonishing if criticisms did not arise from time to time, particularly in those instances where an award has gone against a specific union—has played a significant role in ensuring a degree of industrial stability. Generally speaking, unions have gone along with the decisions made. The fact that TUC membership is still something desired by ordinary members is clear from the recent ballot conducted by the merged engineering union.

Nevertheless, the Government have not been moved by the arguments that we advanced. Moreover, in Committee, your Lordships rejected in a Division the amendment I advanced that would have allowed a union to refuse membership to an applicant where exclusive bargaining rights were held by another union. In Committee the Minister sought to maintain that union membership and union recognition are two quite separate things. I speak from some experience when I say that they are not; they are really very closely connected indeed.

When attempting to organise at a green field site where there is no union membership the very first questions that union organisers are asked by potential members are, "Will the employer recognise the union? What will you do to get recognition?" That is quite natural, for although over the years unions have developed other individual services—legal aid, discount trading, insurance services, holiday and tourist services and so on— the main reason for a union's existence is to negotiate pay and conditions of service. They began as collectives to represent employee interests in situations where the individual had vastly less bargaining power than the employer. That is still the situation and it is why, despite all the efforts of the Government, who, I insist, plainly do not like unions and would make them much more difficult to organise if they could get away with it, unions still continue to exist despite unemployment and despite all the legislation we have had since 1979 and it is why they will continue.

My amendment seeks to salvage at least something from this and to provide some kind of safeguard for industrial stability. It is built on the assumption that a union highly prizes its negotiating rights once it has got them. It seeks to deal with the situation which occasionally arises in which an individual, having fallen out with his colleagues or perhaps finding himself in a minority following a vote on a pay deal or even perhaps as a result of political motivation aided by outside influences which are anti-union, deliberately sets about undermining the union's position. He may seek to organise a breakaway. He may perhaps, deliberately with malicious intent, seek to utilise the provisions of the Bill to undermine the single union agreement which has been established and to which the majority of employees adhere.

Some such situation was envisaged by Nissan when it wrote the letter the text of which I read to your Lordships on the 18th March at col. 1563 of the Official Report in Committee. The letter pointed out, it will be recalled, that the clause if unamended could undermine single union agreements and could put employers in an impossible situation. Surely if an individual, maliciously motivated, sets about trying to undermine the negotiating position of a union it should be possible for the union to deal with him under this clause of the Bill. That is what the amendment is about. It is quite a minor amendment given the size of the clause and the impact that the clause is likely to have when it is in legislation. Nevertheless, it provides some minor safeguard to unions where they have a single union agreement. For that reason it is important. I hope that the Minister will be prepared to give it favourable consideration. I beg to move.

Viscount Ullswater

My Lords, this amendment raises issues which I really thought we had laid to rest, in Committee both in this House and in another place.

The Government believe that individuals should not be prevented from joining the trade union of their choice because of a cartel arrangement between trade unions which preserves their spheres of influence while taking no account of the wishes of members and potential members. Central to the Bridlington principles are the "rules" that a union may not recruit members of another union where that union objects to their transfer and that a union may not organise at a place of work where another union has a majority of members. Those are a clear denial of those individuals' freedom to join the union of their choice. If they consider that another union would serve them better, why should they not be able to join it?

We do recognise of course that unions should not be required to accept anyone and everyone into membership. The clause provides sensible exemptions from the general right of individuals to join the union of their choice. One of these exemptions provides that a union may refuse membership on grounds of conduct. However, it is important that a union cannot use this exemption to exclude someone for a reason that has nothing genuinely to do with "conduct". We must ensure that it does not allow unions to re-introduce aspects of the Bridlington principles by the back door, or undermine other essential planks of our trade union legislation.

In so far as the effect of the amendment is to allow a union to exclude an individual on the ground that it is the intention of that individual to cause damage to the legitimate interests of the union, I have to say, as I have said already in the House, that the amendment is entirely unnecessary. The clause already allows such exclusions. Let us be perfectly clear: any conduct other than that specified in subsection (4) of the clause will be a legitimate reason for exclusion or expulsion, so long as it is the sole reason for that exclusion.

The noble Baroness's arguments have again demonstrated the confusion that appears to linger in the minds of some noble Lords in respect of trade union membership and trade union recognition. This clause is about union membership. It has nothing to do with recognition. As we have said on many occasions, it is up to an employer who, if anyone, he chooses to negotiate with. If he wishes to negotiate collectively, he may choose to do so with one union or with several. That is his decision. That decision may of course be influenced by a number of factors. It has nothing to do with the right of individuals to join the union of their choice.

For the purposes of this clause there are two kinds of conduct: conduct for which exclusion from a union is explicitly not permitted, and any other form of conduct for which exclusion is permitted, provided that it is the sole reason. To the extent that the amendment seeks to reinforce the latter point, it is unnecessary. To the extent that it seeks to limit the former category—the conduct for which exclusion or expulsion is not permitted— I cannot accept it. I hope that the noble Baroness will therefore be persuaded to withdraw the amendment.

Baroness Turner of Camden

My Lords, I have to say that I really am rather unpersuaded. Again I emphasise that there is not this distinction between trade union membership and trade union recognition. The two go very much together. That has been seen by numbers of people who were concerned that the clause as it now stands would be a danger to improvement in the spread of single-union agreements.

The intention is to rule out conduct which is in breach of the rules of the union and which is calculated to impair its position to negotiate with an employer on behalf of its members generally or at the place of work of the individual. In other words, it is elaborating precisely what kind of conduct can be dealt with under the terms of the clause. It is intended to deal with the situation where an individual maliciously seeks to undermine the union's negotiating position. As we said when we discussed the single union situation last time round, we are not alone in our concern that the clause, if unamended, will result in a great deal of industrial instability. We think that the Bridlington principles, though they have been decried on numerous occasions by the Minister, have over the years resulted in a much greater degree of industrial stability than could have been expected otherwise. By removing that kind of restraint on unions we are letting ourselves in for a great many problems and for a great deal of general industrial instability.

In view of the importance of the clause and the fact that this was a minimal attempt to minimise its impact I feel that I have no alternative but to test the opinion of the House.

4.29 p.m.

On Question, Whether the said amendment (No. 7) shall be agreed to?

Their Lordships divided: Contents, 88; Not-Contents, 133.

Division No. 2
CONTENTS
Addington, L.	Grey, E.
Airedale, L.	Hampton, L.
Archer of Sandwell, L.	Hanworth, V.
Ardwick, L.	Harris of Greenwich, L.
Ashley of Stoke, L.	Hilton of Eggardon, B.
Attlee, E.	Hirshfield, L.
Aylestone, L.	Hollis of Heigham, B. [Teller.]
Beaumont of Whitley, L.	Holme of Cheltenham, L.
Blease, L.	Howie of Troon, L.
Bonham-Carter, L.	Hughes, L.
Boston of Faversham, L.	Jay, L.
Bottomley, L.	Jay of Paddington, B.
Bruce of Donington, L.	Jeger, B.
Carmichael of Kelvingrove, L.	Jenkins of Putney, L.
Carter, L.	John-Mackie, L.
Cledwyn of Penrhos, L.	Judd, L.
Cocks of Hartcliffe, L.	Kilbracken, L.
Dean of Beswick, L.	Lockwood, B.
Dormand of Easington, L.	Longford, E.
Ennals, L.	McCarthy, L.
Ezra, L.	Mclntosh of Haringey, L.
Falkland, V.	Mallalieu, B.
Fisher of Rednal, B.	Mason of Barnsley, L.
Fitt, L.	Merlyn-Rees, L.
Gallacher, L.	Mishcon, L.
Galpern, L.	Molloy, L.
Geraint, L.	Morris of Castle Morris, L.
Graham of Edmonton, L.[Teller.]	Mulley, L.
	Murray of Epping Forest, L.
Greene of Harrow Weald, L.	Nicol, B.
Gregson, L.	Northfield, L.

Ogmore, L.	Stoddart of Swindon, L.
Pitt of Hampstead, L.	Strabolgi, L.
Plant of Highfield, L.	Taylor of Blackburn, L.
Ponsonby of Shulbrede, L.	Taylor of Gryfe, L.
Prys-Davies, L.	Thomson of Monifieth, L.
Richard, L.	Tordoff, L.
Robson of Kiddington, B.	Turner of Camden, B.
Rochester, L.	Wallace of Coslany, L.
Sainsbury, L.	Wedderburn of Charlton, L.
Scanlon, L.	White, B.
Seear, B.	Williams of Elvel, L.
Sefton of Garston, L.	Williams of Mostyn, L.
Serota, B.	Winchilsea and Nottingham, E.
Shackleton, L.

NOT-CONTENTS
Aberdare, L.	Hooper, B.
Acton, L.	Hothfield, L.
Aldington, L.	Howe, E.
Alexander of Tunis, E.	Hylton-Foster, B.
Allenby of Megiddo, V.	Johnston of Rockport, L.
Arran, E.	Lauderdale. E.
Astor of Hever, L.	Lindsay, E.
Auckland, L.	Lindsey and Abingdon, E.
Barber of Tewkesbury, L.	Liverpool, E.
Bellwin, L.	Lloyd-George of Dwyfor, E.
Bessborough, E.	Long, V.
Blatch, B.	Lyell, L.
Boardman, L.	Mackay of Ardbrecknish, L.
Borthwick, L.	Mackay of Clashfern, L. [Lord Chancellor.]
Boyd-Carpenter, L.
Brabazon of Tara, L.	Mancroft, L.
Braine of Wheatley, L.	Margadale, L.
Brougham and Vaux, L.	Marlesford, L.
Butterworth, L.	Merrivale, L.
Cadman, L.	Mersey, V.
Caithness, E.	Milverton, L.
Campbell of Croy, L.	Monteagle of Brandon, L.
Carnegy of Lour, B.	Mottistone, L.
Chalfont, L.	Mountevans, L.
Chalker of Wallasey, B.	Mowbray and Stourton, L.
Chelmsford, V.	Moyne, L.
Clark of Kempston, L	Munster, E.
Constantine of Stanmore, L.	Murton of Lindisfarne, L.
Cox, B.	Nelson, E.
Craigavon, V.	Newall, L.
Cullen of Ashbourne, L.	Norrie, L.
Cumberlege, B.	Orkney, L.
Davidson, V.	Oxfuird, V.
Denham, L.	Park of Monmouth, B.
Denton of Wakefield, B.	Pender, L.
Dundonald, E.	Peyton of Yeovil, L.
Eden of Winton, L.	Plummer of St. Marylebone, L.
Elles, B.	Quinton, L.
Elliott of Morpeth, L.	Rankeillour, L.
Elphinstone, L.	Reay, L.
Elton, L.	Renwick, L.
Faithfull, B.	Ridley, V.
Ferrers, E.	Rippon of Hexham, L.
Finsberg, L.	Rodger of Earlsferry, L.
Flather, B.	Rodney, L.
Forbes, L.	Romney, E.
Fraser of Carmyllie, L.	St. Davids, V.
Fraser of Kilmorack, L.	Saltoun of Abernethy, Ly.
Gainford, L.	Sharpies, B.
Gardner of Parkes, B.	Skelmersdale, L.
Geddes, L.	Slim, V.
Gibson-Watt, L.	Stewartby, L.
Goschen, V.	Strathclyde, L.
Greenway, L.	Strathcona and Mount Royal, L.
Halsbury, E.
Harding of Petherton, L.	Strathmore and Kinghorne, E. [Teller.]
Hardwicke, E.
Harmar-Nicholls, L.	Sudeley, L.
Hemphill, L.	Swansea, L.
Henley, L.	Teviot, L.
Hesketh, L. [Teller.]	Thomas of Gwydir, L.
Hives, L.	Thurlow, L.
Holderness, L.	Torrington, V.
HolmPatrick, L.	Trumpington, B.

Ullswater, V.	Whitelaw, V
Vaux of Harrowden, L.	Wynford, L.
Vivian, L.	Young, B.
Wade of Chorlton, L.

Resolved in the negative, and amendment disagreed to accordingly.

4.37 p.m.

Lord Wedderburn of Charlton moved Amendment No. 8: Page 27, line 3, after ("section") insert ("including rights arising from an agreement relating to the application of criteria in subsection (3) of that section").

The noble Lord said: My Lords, the purpose of this amendment to Clause 13 is to ensure that certain fundamental liberty of contract-making is clearly held by trade unions. It is a matter about which there has been widespread concern and ambiguity.

I wish to make five points on the amendment. The first is as to context. This clause prevents workers from establishing and joining organisations of their own choosing without any distinction whatever, subject only to the rules, without need for authorisation. They have the liberty to draw up their constitution and rules and elect their representatives in full freedom. Those words are the nub of the convention on freedom of association of the International Labour Organisation. I think it was established in Committee that, to put it mildly, there is clearly a grave risk of the breach of that convention, which the Government do not answer by simply stating that the clause is not in breach. I hope that at some point in our proceedings the noble Viscount will be able to tell us whether the Government are willing now, having looked at the matter again, to give greater publicity—perhaps by placing documents in the Library—to the transactions at which the various bodies of the ILO have looked regarding this and previous similar legislation, especially in view of the fact that yet again this clause makes use of unjustifiable conduct. That is a category which the ILO has found not to be in accordance with the convention's minimum standards.

Secondly, in that context the clause demands that the trade unions set their admissions and exclusions within the range of what it says are acceptable criteria. For the first time in our law there are limited criteria in this clause as to the right of trade unions to admit and exclude. But they include a number of phrases in the new Section 174, such as invitation by way of a profession, occupation, or trade, or the like. I take those three as characteristics of new Section 174(3).

The question then arises whether, if those criteria are not observed, there is a remedy, and at whose hands. As the clause stands—and I take it that the Government are confident enough by now not to wish to change the basic structure—the new Sections 174(3) and (5) refer on to Section 177. May I read subsections (3) and (5) of Section 177. They give the remedy. Subsection (3) says: The remedy of an individual for infringement of the rights conferred"—— that is an individual who has been excluded improperly— is by way of a complaint to an industrial tribunal in accordance with that section, Sections 175 and 176, and this section, and not otherwise". The rights being set down are remediable by action for compensation in the industrial tribunal.

Indeed, the clauses are framed in a traditional way, repeating what has occurred in previous Bills. Subsection (5) of the new Section 177 states: The rights conferred by Section 174 are in addition to, and not in substitution for, any right which exists apart from that section; and, subject to subsection (4) nothing in that section, Section 175 or 176 or this section affects any remedy for infringement of any such right". In other words, the subsection maintains all the rights which would exist, quite apart from this section, unless, of course, they are in clear breach of the new section. All rights are reserved. Any right which exists apart from the section is maintained.

The question that has arisen comes from the desire of the amendment to add to subsection (5) the words: including rights"— that is to say, maintaining the rights arising from an agreement relating to the application of criteria in subsection (3) of that section". Perhaps, in view of the context, it would have been better to say subsection (3) of Section 174.

Why should we need to do that? It is because terms like "specified trade", "specified profession" or "specified occupation", are notoriously uncertain. I do not go into conduct for the moment. That raises rather different issues. There are great doubts about the meaning. In real life, practices and agreements are likely to grow up around what people understand to be specified professions or occupations. Often they tend to agree—sometimes implicitly—that a certain meaning should be observed, not in contravention of such criteria but to elucidate their application.

For example, if union A and union B—I go straight to the trade unions—agree that as a matter of common sense, since that has always operated in the area of shipyards, or rather shipbuilding as there are scarcely any shipyards, that one of them will take into membership marine engineers while the other will offer itself to all the rest, that would be quite sensible. It does little more than permit trade unions, in agreements even possibly involving employers, through the freedom of contract (which the general law allows the parties) to attach trade meanings and usages as a meaning to any terms other than those prohibited by statute.

Some people have said that it may be the Government's intention to prohibit this kind of agreement. The clause does not do so, in my submission, as it stands. However, it would be of some value to know that the Government really mean to keep to what they have here, possibly even in a later Bill. Obviously, the industrial situation— and the industrial situation not merely for unions but for managers —would be different if the parties were not allowed to agree, not in contravention of the Bill but in application of the Bill. It would be a situation of some gravity for them if they were prevented from doing that which any other citizen could do in that regard.

In my submission the amendment would cure ambiguities. It is not only my submission. There are others who are worried —that the same freedom of contract should be allowed as is allowed to other parties; those, for example, who attach a customary meaning to terms of a contract which is not a breach of a statute. Within the boundaries of the Act I submit that it would be useful for everybody, not simply for trade unions but for industrial relations generally, to make clear at this stage that there is nothing wrong in the kind of conduct that every other citizen in the land can conduct quite properly. I beg to move.

4.45 p.m.

Baroness Turner of Camden

My Lords, I support the amendment moved by my noble friend. I do not want to go over the same arguments. My noble friend has explained clearly what the amendment is about. Speaking with some experience of trade union work over a long period, I stress that it would be a great pity if the kind of inter-union arrangements to which he referred were not permitted. A union can decide to recruit marine engineers and another union will have an agreement with that union under which it recruits the rest. That kind of agreement or arrangement is common in industry and works extremely well. It leads to the degree of industrial stability that I hope we all aim for. With that in view, I hope that the Government feel able to accept the arguments of my noble friend and the amendment that he has moved.

Viscount Ullswater

My Lords, I have to confess that I found it difficult to understand the purpose of the amendment. Therefore, I am grateful to the noble Lord for setting out his reasons for tabling it. I am sorry if my response does not fully deal with his arguments.

Perhaps it would be helpful if I outline the rationale behind the structure of Clause 13 and the purpose of subsection (3) in particular. As noble Lords are aware, the purpose of Clause 13 is to give individuals greater freedom to join the union of their choice. The approach taken in the clause concentrates on the individual right, subject to certain exceptions, rather than defining in the first instance the circumstances in which a union may exclude or expel individuals from membership. Subsection (2) details the reasons which are permissible as grounds for exclusion or expulsion by a trade union. The first of these is that an individual does not qualify, or no longer qualifies, for membership by reason of an enforceable membership requirement in the union's rules. What constitutes an enforceable membership requirement is defined further in subsection (3).

An enforceable requirement is one which restricts membership solely by reference to employment in a specified trade, industry or profession; occupational description (including grade, level, or category of appointment); or possession of specified trade, industrial, or professional qualifications or work experience. Such restrictions are commonly used by trade unions to ensure a commonality of interest among their membership and to make the tasks of representation and negotiation realistic and meaningful. It has never been our intention to force unions to accept into membership individuals who have nothing in common with their existing membership. Such restrictions are therefore acceptable as reasons for exclusion.

The requirement that these exclusions must be specified in the union's rule book, unlike the other acceptable reasons for exclusion in subsection (2), is included to ensure that it is a genuine, generally-applied, rule of the union that membership be restricted in this way. It might otherwise be possible for a union to use these exemptions as a route to exclude specific members in particular circumstances. This would clearly be unacceptable.

The clause therefore provides adequate protection for trades unions against being required to accept inappropriate individuals into membership, while providing the widest appropriate right for individuals to join the trades union of their choice.

I cannot see how the amendment contributes anything worthwhile to the clause. If it simply ensures that rights based on the criteria in subsection (3) and contained in the union's rules are additional remedies to those provided for in the clause, then I believe it to be unnecessary. The clause already makes it quite clear—in the very subsection to which the amendment refers—that the rights conferred by the section are in addition to any other rights. There is no need to specify any of those rights.

I can confirm that the clause does not outlaw agreements between unions as to the matter referred to in subsection (3) of Section 174. However, subsection (5) is not ambiguous. The amendment is superfluous and in no way clarifies subsection (3).

When moving the amendment, the noble Lord, Lord Wedderburn, referred to reports from the ILO and the Council of Europe and asked whether they would be made available. I believe that he asked—if not on this occasion, then on a previous occasion—whether they could be placed in the Library. I have to say that they are made available. I believe that I said in Committee that they are made available to the Trades Union Congress and to the Confederation of British Industry and that they are not confidential. I have no objection to placing the relevant documents in the Library. Having said that, I hope that the noble Lord will accept the explanation that I have given and that he will feel able to withdraw his amendment.

Lord Wedderburn of Charlton

My Lords, I thank the Minister for his reply and especially for what he said about ensuring that ILO documents and the like are readily available. However, having based his reply upon the foundation, as I understood it, that this amendment was difficult to understand, the Minister then readily found that it was unnecessary and superfluous. I find that a somewhat awkward conjunction of argument.

If I may put it this way, I gave the Government reading time on this question because I raised it in Committee on another amendment. Perhaps the Minister will remember that I used the example of a gumboot worker and referred to a real example from years gone by of one trade union which organised workers in the rubber industry and another trade union which organised workers in the shoe industry. The question that arose was: who should organise the workers in the gumboot factory? It seems wrong to say that those two unions cannot possibly reach an agreement on what is meant by the relevant occupation. I was not at all sure at the end of the day whether the Minister said that they could or could not reach such an agreement.

The amendment does not create exemptions. It has nothing to do with exemptions from the section. It has to do with parties who make agreements within the terms of the new law. The amendment does not, by any means, ban freedom of choice. It relates to the freedom of choice of all the people concerned—the members of the various unions and the members who want to join this or that union. As I understand it, the Government accept the fact that if someone comes along and says to a union, "I am a marine engineer and want to join you", and the union says, "No, sorry, we don't cater for marine engineers", that is all right because it is in their rules. That seems okay. All that I am saying is that that is "freedom of contract" within the clause and within the new law. Plainly, the same argument applies to all sorts of other contracts, as those who have more knowledge of industrial relations than I have will be able to explain.

I must advise Ministers generally that, as they know, the courts have now decided, by a decision of your Lordships' Appellate Committee, that they are allowed to look at Hansard. I must say that the answers to some of these amendments are likely to convince them that they had better reverse that decision, because it will not help them to look at this particular debate, which is on a matter that I should have thought rather important. It is about freedom of contract, which is something that I thought that the Government believed in. It is about an amendment which is not a breach of the new law; it is about its application. It is about industrial relations and about doing things sensibly by agreement, yet all we get is a negation of the amendment with the words, "It is too difficult to understand". With great respect to the Minister, that is not good enough.

However, perhaps I can do little more than let the amendment lie upon the table. Without pursuing the matter, I suggest to my noble friends that that is the right and proper course because, if the Government are now understanding the point, perhaps they will look at the matter again on Third Reading. Indeed, I say to them, "Please look at this again on Third Reading because there is an area of ambiguity which could easily be cleared up". If it is acceptable to the House, I shall let the amendment lie.

The Deputy Speaker (Lord Hayter)

My Lords, I did not understand. Is the noble Lord withdrawing the amendment?

Lord Wedderburn of Charlton

My Lords, I understand that it is perfectly permissible to let the amendment lie and not to press the matter to a Division.

The Deputy Speaker

My Lords, is it your Lordships' pleasure that the amendment be withdrawn?

Amendment, by leave, withdrawn.

Clause 14 [Right not to suffer deductions of unauthorised or excessive subscriptions]:

Lord McCarthy moved Amendment No. 9: Page 27, line 11, at beginning insert ("(1) Subject to subsection (10A) below").

The noble Lord said: My Lords, I sincerely hope that this will be a little simpler—at least for the Minister. In moving Amendment No. 9, I am speaking also to Amendment No. 13, which deals with the check-off system, which, in itself, is simple enough. The Minister said that he did not understand the amendment just moved by my noble friend Lord Wedderburn, but that he was against it. I hope that he will understand this amendment and be in favour of it.

This is the last attempt to deal with the realities of the check-off system. We are concerned solely with how the worker gets to know, first, that he is still paying to his union and, secondly, how much he is paying to his union. It seems to us that that is the essence of what we should be concerned with. In the amendment we seek to provide alternative means for establishing those two things. The amendment provides an alternative to the elaborate procedure in the new Section 68 of the 1992 consolidation Act, as amended by Clause 14 which, as we have seen, takes us into a whole maze of notifications, appropriate sums, calculations, authorisations and so on and so on.

In the amendment we suggest as an alternative a situation in which one would not have to apply that complicated and, it seems to us, fairly unpopular way of dealing with a problem which we know the CBI and the TUC do not like. We are not saying that the Government's procedure should be ruled out, but we suggest a parallel procedure. An alternative way of operating a lawful check-off would be based, in effect, on the situation which exists in most industries, firms and areas in which the check-off now exists.

First, the worker must personally authorise the payment by direct debit of a particular sum relating to his or her union subscription (just as happens now from banks accounts for payments such as mortgages, subscriptions to clubs and all kinds of things until we stop those direct debits). Secondly, the employer involved must agree to act as, in effect, the collector, agent or banker. As I have said, the employer agrees to act as agent and the worker authorises a direct debit. As long as the third condition applies—the worker is told regularly that such a deduction is being made and is told whenever it increases (which is precisely the system of rules operating for direct debits)—that system can continue until it is changed either by the worker saying that he does not want to pay any more or by the employer saying that he no longer wants to act as agent.

That is a precise parallel—or as precise as we can get it—to the procedure which exists in other circumstances. That is what we have tried to provide. However, it is also something that, as we pointed out in Committee, regularly happens in industry today because workers obtain, with their pay slips, a notification from the employer of all deductions. As what we are suggesting happens now, in that employees are told regularly what deductions are being made for their union subscriptions, the amendment would not involve employers in any vast new bureaucracy. For that reason, we hope that it will be supported by the friends of the CBI and employers generally.

Of course—and I stress this or it might be misunderstood—the employee can stop payment if he does not like it, just as he can stop it with a direct debit at any time that he does not like it. Of course, the provisions of Section 63A still apply. If there is a complaint that, in one way or another, the provisions of the Bill are not being carried through, that complaint can be dealt with as specified in the Bill. What we suggest squares with all other kinds of deductions: for clubs, political parties, charge accounts at Austin Reeds and Harrods; membership of the National Trust, dependants' allowances; ex-wives and so forth. Those who say that this simple system cannot be done for trade unions have, once again, to say what is so different about trade unions that we cannot accept the provision. I beg to move.

5 p.m.

Lord Rochester

My Lords, in my view Clause 14 is another example of burdens being placed upon trade unions which do not apply to other organisations. I cannot see why individuals, in their capacity as union members, are to be obliged to re-authorise the deduction of union subscriptions from their wages every three years when the same individuals, as subscribers to clubs, charities or other organisations, can enter into a direct debit arrangement with their bank which continues until such a time as they choose to cancel it.

I do not see why employees should be treated as morons in one capacity and as intelligent citizens in another. As I see it, the amendment seeks to correct that anomaly by ensuring that union subscription deductions may be authorised by a direct debit arrangement; and, as a consequence of that arrangement, the obligation to re-authorise payment every three years should not apply. That proposal seems to me to be a reasonable one, and therefore I support the amendment.

Lord Mottistone

My Lords, the noble Lord, Lord McCarthy, said in passing that the amendment would appeal to the CBI among other bodies. Unfortunately since knowing about the amendment I have not had time to discuss it with the CBI so I cannot speak for it. There seems to be a certain amount of logic in the amendment, and I shall be interested to hear what my noble friend has to say.

Lord Howie of Troon

My Lords, in my position as a civil engineering journalist, I am a member of two well-known organisations, one of which is the National Union of Journalists, with which I agree from time to time, and the other is the Institution of Civil Engineers with which I agree more or less all the time. Under these proposals my debit arrangements for subscriptions will be different for the Institutions of Civil Engineers from those of the NUJ. They are equally important to me in my profession, calling or trade—whatever one chooses to call it—and it is absurd that the subscription arrangements should be different. I am sure that the amendment—when the Government think about it—should be supported.

Lord Stoddart of Swindon

My Lords, I too support the amendment. I spoke about this clause earlier this afternoon and in Committee. I must confess that, having heard the replies of the Government Front Bench, I am still not convinced of the necessity for this clause, nor can I understand why it has been brought forward, unless it is to attack further the financial base of the trade union movement. As I understand it, there has been no call for such a provision from the employers. Again, as I understand it—I may be wrong —the employees have been happy to go along with the situation as it presently appertains. There has been no great call from the employers that the arrangements should be altered. Indeed, I further understand that if there is to be any authorisation at all, the employers would prefer that the authorisation period should be longer than three years and at least five years. Why are the Government coming forward with this restrictive provision?

The Government Front Bench is well aware that I am a fair and reasonable person, but on this occasion one is forced to the conclusion that the Government have a firm agenda, and it is an agenda which envisages a much smaller trade union movement than we have at present. I do not know their target; I have heard the figure of 25 per cent. and 20 per cent. of all employees. My guess is that it is the lower. So far, the Government have failed to convince me, and I feel sure that they have failed to convince this side of the House, that that is not one of the prime reasons for this clause.

One is bound to be suspicious, is one not? As has been pointed out by the noble Lord, Lord Rochester, and my noble friend Lord McCarthy, if employees once authorise a charitable donation, that will continue for so long as the employee does not cancel it. So why on earth should a trade union subscription be any different? That, too, is a voluntary subscription and, in many cases, it is also a charitable subscription because the articles of some trade unions are of a charitable nature. Why should trade unionists who are making a voluntary—not forced—contribution to a trade union be required to make an authorisation every three years, whereas if they want to make a regular contribution to the Red Cross or some local charity, they have to make the authorisation once only? This requirement does not just place a burden upon the employee and the trade union involved, it places a great burden on the employers themselves. And it puts the employer at risk, because if an employer deducts an amount from his employee's wages which has not been authorised, perhaps because of an oversight, the employer could be legally liable, taken to court and fined.

Lord McCarthy

My Lords, yes.

Lord Stoddart of Swindon

My Lords, I am grateful to my noble friend Lord McCarthy for confirming that that is right. Under those circumstances, I cannot understand why the Government are so resistant to every amendment put forward regarding this clause. I sincerely hope that they will find themselves less resistant this afternoon.

Baroness Denton of Wakefield

My Lords, I have listened with interest to the several points made by my noble friend Lord Mottistone and noble Lords opposite. However, noble Lords will not be surprised that they have failed to convince me. The noble Lord, Lord McCarthy, said earlier that I was defending in an indefensible way. I felt that our defence was straightforward: we believe that trade unions should fund their own ballots. I cannot be clearer than that, and I hope that I am also clear on this occasion.

Perhaps I may draw attention to the issue which is at point in Clause 14 in relation to the major differences, ideas and suggestions to which the noble Lord has referred. It was interesting to note that the examples quoted varied among noble Lords. The noble Lord, Lord Howie, referred to professional subscriptions; the noble Lord, Lord Stoddart, referred to charitable subscriptions; and the noble Lord, Lord McCarthy, referred to the use of charge cards at stores. In all those instances the funds being donated or assigned are already in the bank. In this instance we are talking about the money which is the wage packet of the employee and not already with him. We are talking about informing the employee of deductions to be taken from his salary and not the expenditure of funds already paid—

Lord McCarthy

My Lords, does the noble Baroness agree that in the average deduction slip which the average worker receives at the end of the average week or the average month the average employer is making many deductions from funds which are not in the bank? We want to square with that situation.

Baroness Denton of Wakefield

My Lords, they are legal, authorised deductions. We are not talking about choosing what to take. Clause 14 offers trade union members who pay their subscriptions through check-off significant new legal protections. With respect to the noble Lord, Lord Stoddart, the reform is rooted in improving the rights of individual trade union members and not the rights of employers. Many employers and employers' associations have supported the principle of the reform. The purpose of the amendment appears to be that when employers operate direct debit arrangements—and quite what is meant by the use of the term here is not clear—none of those protections applies. There is what appears to be the right to be informed when a deduction has been made but nothing more—not even a requirement that written consent should be obtained.

It seemed that as the Bill progressed through your Lordships' House and through another place, we had established that there was general agreement about some of the features of Clause 14. The principle of written consent seemed to be accepted, as did the right to information in advance of increases and the right to withdraw from the arrangements at any time. But apparently that consensus has vanished. Under the terms of the amendments, employers are to operate something called "direct debit" arrangements—though it is certainly not what is normally understood by the term "direct debit"—and protection for the individual has disappeared.

Employers cannot operate direct debit. The direct debit system was established and is administered by banks and building societies. No one but banks or building societies may make direct debit deductions. The deductions are made from bank accounts, not from salaries. It is simply nonsensical to suggest that any arrangement which employers might operate in respect of trade union deductions can come under the heading of "direct debit".

Baroness Seear

My Lords, will the Minister inform the House how that lines up with the give-as-you-earn scheme, which is deducted? That similarly is deducted from salaries and not from money already in the bank. I ask for information.

Baroness Denton of Wakefield

My Lords, those are deductions approved by the individual. In this case we are trying to protect the individual's rights—

Lord Stoddart of Swindon

My Lords, I am sorry to interrupt but we on this side of the House are very puzzled about what the noble Baroness is trying to tell us. On the one hand, she says that she wishes to protect workers' rights in relation to trade union subscriptions but, on the other hand, she says that she does not wish to protect the rights of people under the give-as-you-earn schemes. They are exactly the same in law and they are the same in operation; they are authorisations made by the employee to the employer to deduct funds from his wages for a specific purpose. One purpose is to contribute to the trade union and the other is to contribute to a particular charity. What on earth is the difference? The Minister has not explained that and she certainly has not convinced us.

5.15 p.m.

Baroness Denton of Wakefield

My Lords, perhaps I may make it clear that we are not trying to stop check-off. Check-off is separate and special. Only check-off gives rise to the thoroughly unsatisfactory legal position under which the only legal right to stop making payment in this way is to leave the union. Additionally, there is the legal possibility that check-off arrangements which are a part of a collective agreement can be implied into an individual's contract of employment without his express consent—

Lord Wedderburn of Charlton

My Lords, I apologise for interrupting the Minister but she has made a pronouncement of extraordinary importance in regard to the present law. Will she confirm that she is of the opinion that the only way to end a check-off arrangement is for a worker to leave the union? If the Minister confirms that, will she tell us the precedent in case law or in statute on which that proposition is founded?

Baroness Denton of Wakefield

My Lords, the matter arose in Committee and there was a disagreement of view. There are many ways, but the only legal way—and that is what we are trying to correct—is to leave the union.

Lord Pitt of Hampstead

My Lords, I belong to the British Medical Association, which is a trade union. My subscriptions are deducted from my bank account every year. I do not have to leave the BMA to stop that. That is nonsense.

Baroness Denton of Wakefield

My Lords, I believe that the noble Lord is somewhat confused; that is not check-off, to which we are applying this clause. Additionally, there is the legal possibility that check-off arrangements which are part of a collective agreement can be implied into an individual's contract of employment without his or her express consent. The proposals in Clause 14 rectify the current and unsatisfactory legal status of check-off. If noble Lords are anxious to ensure that trade unions can collect their members' subscriptions by direct debit, there is nothing in this Bill or in any law to prevent them from doing so. The provisions in the Bill, which intentionally apply only to check-off arrangements, would not impact on an arrangement between a union and its members for subscriptions to be paid by direct debit from the members' bank or building society.

I suggest that the amendments do not have a real meaning. Employers cannot operate direct debit arrangements on behalf of their workers and there is no valid comparison between check-off arrangements and direct debit. Therefore, I hope that the noble Lord will not press the amendment.

Lord Stoddart of Swindon

My Lords, before the noble Baroness sits down, and I am sorry to trouble her—

Lord Mottistone

My Lords, on a point of order—

Lord Stoddart of Swindon

My Lords, there is no point of order.

Lord Mottistone

My Lords, this is Report stage.

Noble Lords

Stoddart!

Lord Stoddart of Swindon

My Lords, the noble Baroness has worried many of us. She appeared to be saying—and I wish that she would confirm it—that there are trade unions in this country which will allow their members to have their subscriptions paid to the trade union only through a deduction from wages and that they will not accept subscriptions in any other way; that is, not at a branch, by direct debit, by cash, by post and so on. I have never heard of that. If the noble Baroness has a precedent, she owes it to the House to give it.

Baroness Denton of Wakefield

My Lords, the trade union rules are such that the legal position as regards check-off is that the individual member cannot move from those rules.

Lord McCarthy

He can resign.

Baroness Denton of Wakefield

My Lords, that is what we are saying. The aim of our clause is to avoid that being the only way out.

Lord McCarthy

My Lords, the noble Baroness would not deny that an individual trade unionist who does not wish to pay by check-off can write to the secretary of the branch and say, "In future, issue me with a card. I am stopping check-off." There is nothing impossible about that and he would not have to leave the union.

Lord Greene of Harrow Weald

My Lords, may I ask the Minister a question?

Noble Lords

Order, order!

Baroness Denton of Wakefield

My Lords, I should point out that the clause is not based on what unions do or do not do. It is based on the unsatisfactory legal position which currently pertains. I do not disagree with the remark made by the noble Lord. that that is a possibility, but here we are dealing with the legal position.

Lord McCarthy

My Lords, we are extremely disappointed in the way in which the amendment has been received. It is notable that the Government have not been defended. They are not alone but they have not been defended. The only person who has intervened in the debate on the Government's side is the noble Lord, Lord Mottistone. He rather smiled upon the amendment and said that he thought that the CBI might also have smiled upon it. Therefore, all noble Lords have supported the amendment and none of the Government's doughty supporters felt that they wished to attack this significant amendment.

The noble Baroness gave us a series of interesting and novel arguments against it. First, she says that this cannot be done because the other examples which I gave all come from bank accounts—sums in the bank. That is not true, as my noble friends have said. An employer makes all kinds of deductions from people who do not have bank accounts; for example, you can give to Oxfam, you can pay into an insurance scheme and you can pay into a pension fund through the employer. Indeed, he makes superannuation deductions. Those people do not necessarily have bank accounts. That is the end of that argument.

Secondly, what has a bank account to do with this anyway? We are talking about deductions. Whether or not people have bank accounts and whether they have surpluses or deficits is not an argument for doing or not doing anything. In fact, it is not even a difference because in many cases people do not have bank accounts.

The noble Baroness said that a kind of consensus had been achieved in the other place which we are trying to get rid of by virtue of this amendment. I thought that I had made it clear—and I apologise if I did not—that this is an alternative to the existing provisions in a Bill. We are not saying, "Take all that nonsense away". We are saying that that nonsense will continue to apply, which will antagonise the employers and muck up the unions, unless our common-sense alternative is accepted. We are not getting rid of the consensus in any way. The consensus agreed that there should be regular notification from the unions and the situation should not exist, which the Government always say does exist, where this can be achieved through collective agreements, although I know of no examples of that. In future, agreement will have to be given by the individual worker for the check-off to continue. That is the unsatisfactory aspect of the present legal position, according to the Government. We are quite prepared to get rid of that and that is not affected by our amendment because our amendment provides for individual agreement.

The noble Baroness says that the phrase "direct debit" cannot be used because it is sacred—it applies only narrowly. It is a term of art in law. If that is the only objection, we will call it direct deduction. If that phrase cannot be used, then we shall find another phrase which can be used. The phrase itself does not matter. We all know what we are suggesting; namely, an effective alternative which most people seem to think will work reasonably.

The final defence—and I have tried to think about this, as have other noble Lords on this side of the House—is the perpetual argument from the Government that they cannot accept the amendment because under the present situation, if a member leaves check-off, he leaves the union. The Government are saying that that is the only way that you can leave check-off. Suddenly and strangely, the Government do not like people leaving unions. They will not do what the TUC wants because they believe that the TUC wants to engage a situation in which people inadvertently leave unions. As great supporters of the trade union movement, they will not allow that. We must not allow workers to leave trade unions.

I have tried to think what that means. If you stop the check-off arrangement and at that point you do absolutely nothing else, of course you leave the union because you run out. That is what the Government wish to prevent people doing—running out. The Government should not worry about that because people will not run out of the unions: they will join them. If that is the only defence that the Government have, they do not have a defence and I must test the will of the House.

5.27 p.m.

On Question, Whether the said amendment (No. 9) shall be agreed to?

Their Lordships divided: Contents, 80; Not-Contents, 137.

Division No. 3
CONTENTS
Addington, L.	Cledwyn of Penrhos, L.
Archer of Sandwell, L.	Dean of Beswick, L.
Ardwick, L.	Diamond, L.
Ashley of Stoke, L.	Dormand of Easington, L.
Attlee, E.	Falkland, V.
Aylestone, L.	Fisher of Rednal, B.
Beaumont of Whitley, L.	Fitt, L.
Blease, L.	Gallacher, L.
Bonham-Carter, L.	Galpern, L.
Boston of Faversham, L.	Geraint, L.
Bottomley, L.	Graham of Edmonton, L.[Teller.]
Brooks of Tremorfa, L.
Bruce of Donington, L.	Greene of Harrow Weald, L.
Carmichael of Kelvingrove, L.	Grey, E.

Hampton, L.	Mottistone, L.
Hanworth, V.	Mulley, L.
Hayter, L.	Nicol, B.
Hilton of Eggardon, B.	Peston, L.
Hollick, L.	Pitt of Hampstead, L.
Hollis of Heigham, B.	Plant of Highfield, L.
Holme of Cheltenham, L.	Prys-Davies, L.
Hooson, L.	Redesdale, L.
Houghton of Sowerby, L.	Robson of Kiddington, B.
Howie of Troon, L.	Rochester, L. [Teller.]
Hughes, L.	Scanlon, L.
Irvine of Lairg, L.	Seear, B.
Jay, L.	Sefton of Garston, L.
Jay of Paddington, B.	Serota, B.
Jeger, B.	Shackleton, L.
Jenkins of Putney, L.	Stoddart of Swindon, L.
Kennet, L.	Strabolgi, L.
Kilbracken, L.	Taylor of Blackburn, L.
Lockwood, B.	Thomson of Monifieth, L.
Longford, E.	Tordoff, L.
McCarthy, L.	Turner of Camden, B.
Mclntosh of Haringey, L.	Wedderburn of Charlton, L.
Mallalieu, B.	White, B.
Mason of Barnsley, L.	Williams of Elvel, L.
Merlyn-Rees, L.	Williams of Mostyn, L.
Molloy, L.	Winchilsea and Nottingham, E
Morris of Castle Morris, L.

NOT-CONTENTS
Acton, L.	Fraser of Kilmorack, L.
Aldington, L.	Gardner of Parkes, B.
Alexander of Tunis, E.	Geddes, L.
Allenby of Megiddo, V.	Gibson-Watt, L.
Arran, E.	Goschen, V.
Astor, V.	Greenway, L.
Auckland, L.	Halsbury, E.
Banbury of Southam, L.	Hardwicke, E.
Belhaven and Stenton, L.	Harmar-Nicholls, L.
Bessborough, E.	Harmsworth, L.
Birdwood, L.	Hemphill, L.
Blatch, B.	Henley, L.
Boardman, L.	Hesketh, L. [Teller.]
Borthwick, L.	Hives, L.
Boyd-Carpenter, L.	HolmPatrick, L.
Brabazon of Tara, L.	Hooper, B.
Braine of Wheatley, L.	Hothfield, L.
Brougham and Vaux, L.	Howe, E.
Butterworth, L.	Hylton-Foster, B.
Cadman, L.	Jellicoe, E.
Caithness, E.	Jenkin of Roding, L.
Campbell of Croy, L.	Johnston of Rockport, L.
Carnegy of Lour, B.	Killearn, L.
Carnock, L.	Kinnoull, E.
Chalker of Wallasey, B.	Lauderdale, E.
Chelmsford, V.	Layton, L.
Clark of Kempston, L	Leigh, L.
Colnbrook, L.	Lindsay, E.
Colville of Culross, V.	Lindsey and Abingdon, E.
Colwyn, L.	Liverpool, Bp.
Constantine of Stanmore, L.	Long, V.
Cox, B.	McColl of Dulwich, L.
Craigavon, V.	Mackay of Ardbrecknish, L.
Cranborne, V.	Mackay of Clashfern, L.
Cullen of Ashbourne, L.[Lord Chancellor.]
Cumberlege, B.	Manton, L.
Davidson, V.	Margadale, L.
Denham, L.	Marlesford, L.
Denton of Wakefield, B.	Marsh, L.
Derwent, L.	Merrivale, L.
Dundonald, E.	Mersey, V.
Elles, B.	Milverton, L.
Elliott of Morpeth, L.	Mountevans, L.
Elphinstone, L.	Moyne, L.
Elton, L.	Munster, E.
Faithfull, B.	Murton of Lindisfarne, L.
Ferrers, E.	Nelson, E.
Finsberg, L.	Norrie, L.
Flather, B.	Orkney, E.
Forbes, L.	Orr-Ewing, L.
Fraser of Carmyllie, L.	Oxfuird, V.

Park of Monmouth, B.	Strathmore and Kinghorne, E[Teller.]
Pender, L.
Peyton of Yeovil, L.	Sudeley, L.
Plummer of St. Marylebone, L.	Swansea, L.
Rankeillour, L.	Swinfen, L.
Reading, M.	Teviot, L.
Reay, L.	Thomas of Gwydir, L.
Rennell, L.	Trefgarne, L.
Renton, L.	Trumpington, B.
Ridley, V.	Ullswater, V.
Rippon of Hexham, L.	Vaux of Harrowden, L.
Rodger of Earlsferry, L.	Vivian, L.
Romney, E.	Wakeham, L.[Lord Privy Seal]
St. Davids, V.
Saltoun of Abernethy, Ly.	Waterford, M.
Sharpies, B.	Whitelaw, V.
Skelmersdale, L.	Wynford, L.
Stewartby, L.	Young, B.
Strathclyde, L.
Strathcona and Mount Royal, L.

Resolved in the negative, and amendment disagreed to accordingly.

5.35 p.m.

Baroness Denton of Wakefield moved Amendment No. 10: Page 27, line 36, leave out ("date of') and insert ("day on which the worker signs and dates").

The noble Baroness said: My Lords, this is a technical amendment to remove a minor uncertainty in the drafting of Clause 14. Under the terms of the clause, check-off deductions may lawfully be made from an individual's wages if he has signed and dated an authorisation document. Once he has done so, and unless he chooses to withdraw his consent, deductions may continue to be made for up to three years. The amendment puts beyond doubt that the authorisation document should be dated with the actual date upon which it is signed and that it remains valid for three years from the day on which the worker signs and dates it. I hope that your Lordships will be able to accept the amendment. I beg to move.

Lord McCarthy

My Lords, I have no objection at all to the amendment.

On Question, amendment agreed to.

Lord Mottistone moved Amendment No. 11: Page 28, line 6, at end insert: ("( ) Where the worker has received appropriate notice as defined in subsection (7) from the trade union or some other source, nothing in subsection (5) (b) above shall prevent a deduction of the increased amount of subscription from being a deduction of a permitted amount. For the avoidance of doubt, nothing in this subsection shall affect the right of complaint contained in section 68A.").

The noble Lord said: My Lords, in moving Amendment No. 11, I should like to speak also to Amendments Nos. 14, 15, and 16. The amendments deal with the question of just exactly how to identify the employers who, as I see it in the check-off, are acting as agents between the union and its members. Parts of the new Section 68 imply that employers are responsible for the moneys and that they are not just agents.

In relation to the last amendment, my noble friend Lady Denton said that because no one objected to Clause 14 in the other place she understood that all employers thought that it was all right. It is unfortunate that, in going through another place, the CBI took a view that it was better to put the employer's viewpoint to officials and not to bring it to the Floor of the House. Whether or not that was a good plan is another matter. But it certainly was not the case that the employers thought that Clause 14 was good. In fact, they foresee considerable problems with particular provisions in the clause.

Employers are particularly keen that the clause should show that they are merely acting in the role of a collection agency. They are not in any way concerned with the benefit which the individual may or may not derive through membership of a trade union or what that individual is prepared to pay for that privilege. It is their firm belief that any responsibility for notifying union members of increases in subscriptions, and indeed for reminding individuals of their right to pay their subscriptions by alternative means, should rest with the union and the union alone. They recognise—and here we return to the last amendment—that there are other ways of paying.

In the course of our debate in Committee my noble friend Lady Denton made the point that, as the employer is the person who collects the subscriptions, the employer must be held responsible for the deductions from wages and that, therefore, this justified placing the burden of notifying increases in subscriptions on employers. I still believe that that is a matter for the trade unions. However, although I would have preferred to table again the amendments that I tabled in Committee which were much more straightforward on this point, I have altered them—No. 11 is the key amendment that I have altered—to try to take account of what my noble friend Lady Denton said in Committee.

This amendment does not seek to remove the employer's accountability for unlawful deductions from pay, nor, as redrafted, does it remove the primary obligation on the employer to ensure that any subscription deductions do not exceed the permitted amount. However, the amendment ensures that in any case where the employee has received the prescribed form of notice from the union, there is no need for the employer then to duplicate the very same procedure. I believe that is a mild way of dealing with this situation. I hope therefore that my noble friend the Minister will give it great regard in deciding whether he can perhaps go some way to meeting me.

An additional benefit of Amendment No. 11 is that it would permit employers and trade unions to agree between themselves which of them would be responsible for providing the necessary notice. I am sure that where the check-off system operates, the unions would be happy to follow that kind of practice.

My Amendments Nos. 14, 15 and 16 are consequential to the main amendment and provide the necessary protection for the employer who has relied in good faith on the trade union having agreed to notify increases in subscriptions and subsequently finds himself being held liable for the union's own default, where this exists. I suggest to your Lordships that in this instance there must be some mechanism through which the employer can seek redress. It seems to me wrong in principle in Clause 14 that the only law insists on the employer finding the cash and has no particular call on the union to find the cash where there has been an error and the matter has been brought to a court or to a tribunal as the case may be in relation to the relevant subsections of this clause.

I believe that my amendments as redrafted go some considerable way towards meeting the Government's position. By ensuring that the individual receives a notice, by leaving the responsibility for the deduction with an employer, but at least providing some facility for alleviating the employer's burden if the employer incurs a burden before a court or a tribunal, I believe that my amendment satisfies all the objectives as put to me by my noble friend the Minister.

These amendments will not only avoid confusing the relationship between trade union members, their union and the employer but will relieve substantially the extra administration which employers currently face as a consequence of this part of the Bill. My noble friend the Minister made the point in Committee that as there is no legal duty to undertake the check-off system, this is a burden which is voluntarily assumed by employers. I have to say that there are significant advantages both for employers and for employees in carrying out the check-off. However, my amendments merely seek to permit that process to be made more manageable and not to create wrong impressions about who is responsible for what in this general picture. I hope that my noble friend will on this occasion be able to go some way towards meeting me. I beg to move.

Lord Rochester

My Lords, in Committee I agreed with the noble Lord, Lord Mottistone, and indeed with the TUC that it should be for the union rather than an employer to give notice to the employee of any increase in the amount of union subscription to be deducted from wages. We are now in the position that we have to accept the Government's view that this responsibility should lie with the employer. However, I support the noble Lord, Lord Mottistone, in his contention that in cases where the employee receives the prescribed notice from the union, the employer should not then be required to duplicate exactly the same procedure.

It must follow that where the employer has thus relied on the union to notify the increase in subscription, and the employer is subsequently held liable for the union's default, if that should happen, the employer should be entitled to redress in the form that is set out in Amendments Nos. 14 to 16. I hope that I have already made it plain enough that I would much rather see this clause excised from the Bill altogether, but if we must have it I feel that I should support the amendments.

5.45 p.m.

Lord Wedderburn of Charlton

My Lords, I hope that I may briefly register a mild word of agreement with the noble Lord, Lord Mottistone. I hope that does not cause him too much astonishment. I submit that the importance of this approach is that it is based upon the notion, as the noble Lord put it, that it is best if the employer and the trade union agree which of them is to send a notice or take whatever other step is necessary. The best way to operate a check-off is of course by a negotiated agreement. That can often solve problems of this kind. That does not rest on whether or not there is a duty in the law to operate a check-off. In a jurisdiction not many hundreds of miles away on the Continent that duty exists but, of course, it is operated through joint agreements. The trouble with the Government's clause, particularly as regards the approach the noble Lord, Lord Mottistone, has adopted, is that it does not give much scope for negotiated methods of operating the check-off. It seems to me that the employer must remain responsible in the last resort for his deductions, but that is a minor point compared with the measure of consensus that we have achieved that this matter should be operated by agreement between employers and unions. It is the failure of the Government to include that element that is causing them so much trouble.

Lord Boyd-Carpenter

My Lords, I hope that my noble friend Lord Mottistone can clear up one point in his amendment which puzzles me. The amendment states: Where the worker has received appropriate notice as defined in subsection (7) from the trade union or some other source". What other source is that?

Lord Mottistone

My Lords, the notification may come from the trade union directly or it may come from an official within the company or from the trade union outside the company. There are various ways in which people can be informed of changes. The shop steward might inform workers of changes as I understand the position. Or it may be the case that a worker receives a letter from his general secretary. I do not know all the details of this matter but that measure was included as a necessary supplement.

Lord Stoddart of Swindon

My Lords, I do not wish to comment except to say that, bearing in mind the previous interventions of the noble Lord, Lord Mottistone, on points of order, the final exchange between the noble Lord and his noble friend although useful was completely out of order.

Viscount Ullswater

My Lords, I trust that I shall be in order. I am grateful to my noble friend Lord Mottistone for his remarks explaining his amendments. I know that in tabling these amendments he has endeavoured to take account of some of the objections we had to the similar amendments that he put forward when your Lordships considered this Bill in Committee. I am grateful to him for that. However, I have to say that I remain unable to accept his amendments.

The effect of the amendments would be to bring about a major change in the provisions contained in Clause 14 of this Bill. They would remove the requirement that advance notice of an increase in the deductions to be made from an individual's wages by his employer in respect of union subscriptions must be issued by that employer. As a consequence of that shift in responsibility, the remedy for a wrongful deduction would also be altered, to enable trade unions to be joined in tribunal proceedings. The substantive amendment in this group goes quite contrary to government policy on the issue of check-off deductions, and we therefore cannot accept it.

In explaining the Government's response to this amendment, I should like to return to the first principles of Clause 14. The provisions it contains are being introduced to protect the interests of individual trade union members who pay their trade union subscriptions through the check-off. The principles it contains were, of course, the subject of wide consultation and were welcomed by many.

Clause 14 offers trade union members new protection in two respects: it gives all trade union members the right to have their consent sought before these deductions are made and at intervals thereafter, and it gives them the right to receive information about increases in the amounts of money being deducted from their wages at source.

I believe that my noble friend, Lord Mottistone, and, I dare say, other noble Lords around the House, object to none of this. They may have comments to make about whether it is the right thing to do. We disagree only in respect of who should issue the advance information about increases required by the clause. I contend that in assigning that responsibility to the employer the Government have chosen the only logical answer to this Question, as well as one that is consistent with the policy underpinning the clause.

The subject of the clause is the check-off, which in this context is an administrative arrangement between employer and employee. It is quite separate and distinct from the direct relationship between the union and its members. It is a financial transaction. Just as the amount that an employer pays his employee is a matter between them, so any amounts of money that the employer deducts from that employee's pay in respect of trade union subscriptions are a matter between them both. The act of deduction is and must be the responsibility of the employer who effects the transaction.

We are resisting the amendment, therefore, because it is inappropriate to the purpose and effect of Clause 14. Of course we agree that trade unions should inform their members when they increase their subscriptions. They should so inform all their members—not just those who pay through the check-off. But that is not our concern here. We are concerned only with deductions made by employers via the check-off arrangement. It is only right that employers should remain responsible for ensuring that they are acting lawfully at all times.

It is entirely up to the employer to decide the terms in which he notifies the increases. He can certainly say in the notice that he issues that "The union has informed me … " and so on, but there is no need to spell that out on the face of the Bill.

It may be, however, that there are those who fear that the requirement to issue advance notice of increases places too heavy a cost burden on employers. Let me reassure your Lordships that any such fears are groundless. Employers are currently and will remain quite at liberty to pass on to the relevant union any costs associated with the collection of check-off payments. After all, in operating the check-off they are providing a service for the union.

It may also be that the consequential amendments of my noble friend Lord Mottistone concerning tribunal proceedings reflect a fear among employers that any eventual proceedings may also place a cost burden on them. Again, I can allay any such fears. Employers will be quite at liberty to require those unions on whose behalf they operate the check-off to indemnify them financially against any legal proceedings or wrongful deductions. Therefore, no employer need suffer any financial penalty for operating the check-off.

I understand that my noble friend has changed the wording of his amendments to take account of our discussions at Committee stage. I have considered them carefully, but I believe that they go against the principle of Clause 14. I hope that what I have said will persuade my noble friend that he should withdraw his amendment.

Lord McCarthy

My Lords, I wonder whether the Government realise how alone they are on this issue.

Noble Lords

Order!

Lord McCarthy

My Lords, I did not think that we had made a contribution from this side of the House. The Government will never know how alone they are!

Lord Mottistone

My Lords, I believe that it is perfectly proper for the noble Lord, Lord McCarthy, to speak because he has not yet intervened in the debate.

Viscount Goschen

My Lords, at Report stage it would not be in order because the noble Lord would be speaking after the Minister.

Lord Mottistone

My Lords, that is right. I had forgotten that.

I find it difficult to be convinced by my noble friend's initial statement that my amendments would totally upset what the Government believe to be the purpose of Clause 14. I cannot see that that is so. Nor did my noble friend provide a good explanation as to why, even if that is so, it is necessary for Clause 14 to be in such a form that the amendments would spoil it. I see the reason for Clause 14 —although I suspect that some noble Lords do not see it—but I do not understand why it is said bluntly that my amendments, including those moved at Committee stage, are unacceptable because they go against the principle of Clause 14. Nothing that my noble friend said, or that my noble friend Lady Denton said at Committee stage, has persuaded me otherwise.

Amendments Nos. 14 to 16 seek to write into the Bill protection for the employer in the event that he deducts an amount from somebody's wages about which the union has not told the employee and the employee takes the employer to the tribunal. My noble friend said that once the employer has paid whatever the tribunal or the court tells him to pay, he can get the money back from the union. If it is necessary for the employee to be given the powers which are contained in the latter part of the clause to enable him to take the employer to the tribunal in order for the employee to get his money back, it is not unreasonable for the Bill to state that, furthermore, the employer can then be reimbursed by the union.

My noble friend said grandly that the employer can, I suppose, sue the union. That will cost him money whereas if the matter is written into the Bill the process would be automatic. I do not consider it unreasonable to include those protective amendments, even if we agree that Amendment No. 11 destroys the purpose of Clause 14, which I do not understand. In a sense the issues are separate.

I am totally dissatisfied. However, I do not believe that there is any point in taking the matter to a Division because I do not believe that I stand a chance, in view of the result of earlier Divisions. Furthermore, to do so would remove the option, which I intend to work towards, to return to the argument at Third Reading. I have to he persuaded why the amendments are unacceptable. They provide a reasonable protection for the employer in his role as agent between unions and employees. My noble friend said that employers were just that. I was delighted to hear him say that because if they are agents, it should be clear beyond all peradventure in the clause that that is what they are. That would clarify the issue for everybody.

At this stage I shall reserve the right to return to the matter at Third Reading. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

6 p.m.

Lord Howie of Troon moved Amendment No. 11A: Page 28, line 9, at end insert ("or to an increase in a wage rate by reference to which the worker's subscription deductions are calculated and which has been notified to all members concerned by the Union.").

The noble Lord said: My Lords, I have been asked to put down the amendment by the Society of Telecom Executives, which is a moderate union to which I give extremely moderate advice from time to time when the need arises.

The amendment is a technical rather than a philosophical matter about which the union is worried. As I understand it, the Government's intention in Clause 14 is to deal with unions which seek to make subscription increases greater than those to which a union member might have agreed had that member been given a specific choice. The purpose of Amendment No. 11A is to cover those cases where unions and their members have agreed, usually through the rules, that the union contribution should be tied to a particular wage rate. I am told that that arrangement has two advantages. First, it can be represented as performance pay for the union. As a union achieves an increase in members' rates, so the union's income rises. Secondly, it is simply and readily understood. The number of minutes' work per week needed to pay for the union's subscriptions every year remains unchanged.

Where such arrangements exist, they are accepted by employees as a sensible way of regulating the contribution to the unions and are not a source of extra work to the employer. However, under circumstances in which union members have agreed to contributions on that basis, it is unreasonable for the Government to insist that each employer must remind each worker on every occasion that the application of the formula leads to such an increase—that is, every time the employer negotiates an increase in the wage rate—of an individual's right to cease paying union contributions.

Given that the law requires a three-yearly authorisation of check-off, those actions would add considerably to the administrative effort required by the employer in providing check-off arrangements. They must therefore provide an incentive to the employer not to provide such arrangements.

Noble Lords will be aware that trade unions are voluntary organisations. Their members belong to them because they have chosen to do so. The right of the union to seek an agreement with an employer so that the trade union members —the employees of the firm—may enjoy the benefit of that convenient way of paying subscriptions should be a matter for agreement between the union and the employer. I believe that it is perverse for the Government deliberately to make more difficult an arrangement which is simple, well understood and flows from a clear understanding of how contributions are to be determined.

The amendment seeks to put that right. It provides that, first, where the subscription increase flows directly from an increase in a wage rate on a published formula, and, secondly, where that increase has been notified to all the members concerned by the union, there should then be no requirement for the employer to have to take those excessive and potentially expensive actions. I believe that the main inconvenience of the provision falls initially upon the employer and runs against the Government's general approach to regulation. I beg to move.

Lord McCarthy

My Lords, I hope that the Minister will correct us if we are wrong because we are in great sympathy with what the noble Lord wishes to do. However, so far as we understand, the matter is dealt with on the face of the Bill. New Section 68(6) refers to that amount of increase which is disallowed because, in a sense, it has not been authorised. It states: So much of the increase referred to in subsection 5(b) is relevant as is not attributable solely to an increase in the wages payable on the relevant day". That seems to us to cover the point that the noble Lord makes. However, he wishes to add, or to an increase"… that is another qualification… in a wage rate by reference to which the worker's subscription deductions are calculated and which have been notified to all members concerned by the Union". That last part of the amendment does not seem to be required by new Section 68(6) of the Bill. On that basis we do not favour the amendment. However, if matters are otherwise, I look forward to hearing from the Minister.

Viscount Ullswater

My Lords, I am grateful to the noble Lord, Lord Howie of Troon, for his words of explanation on the amendment. I am afraid that, reasonable as he suggests they are, I am unable to accept it.

One of the important features of Clause 14 is the new right that it gives to trade union members who pay their subscriptions by deduction from their wages at source to be notified in advance of any increase.

We have discussed separately the issue of who should be responsible for sending out that notification, and we have made it clear that it is our belief that the employer should, because it is his proper responsibility.

However, it is most certainly not our intention that employers should be unreasonably burdened by the new provisions. Therefore, we accepted in another place arguments put to us that where a union's subscription rate is calculated by reference to an individual's own earnings, for example as a percentage of his pay, as highlighted by the noble Lord, Lord McCarthy, then it would be unreasonable to expect employers to issue advance notice every time.

After all, if we take the case of a worker who pays a percentage of his pay as his union subscription, every time his pay alters his subscription will alter. He might earn overtime periodically, and each time his subscription might alter. Every time that subscription increased, his employer would have to notify him a month in advance. In many cases, such a requirement would simply not be practicable.

We therefore agreed that in these cases, advance notice of increases which result solely from an increase in the individual's wages need not be issued.

However, the amendment before us is very different. Its effect would be that advance notice of increases need not be issued when subscriptions are calculated by reference to a particular point on a pay scale rather than to an individual's pay.

The situations are quite distinct. Pay scales do not fluctuate as individual earnings may. They probably alter no more often than once a year. The likelihood of the employer being burdened by a requirement to issue frequent notices of increase simply does not arise.

In effect, a union which sets its subscription rate by reference to a particular point on a pay scale is setting a flat rate subscription in a different guise. They are quite entitled to do so. But it does not follow that a union member who pays his subscription in this way should be denied the protection offered to his workmate whose union sets what clearly is a flat rate subscription.

Moreover, whereas a worker will generally be well informed about any increases in his own pay packet and their implications, where appropriate, for his union subscriptions, he may not always be so well informed about increases in the central pay scale. Where an increase results from a change in the pay scale, he therefore should be personally informed by his employer.

As I have said, we can see no case for the amendment. I hope therefore that the noble Lord will see fit to withdraw it.

Lord Howie of Troon

My Lords, I am grateful to the Minister for his reply, and to my noble friend Lord McCarthy for his comments. I shall read them in Hansard tomorrow to see whether I understand them.

I have only one comment to make on the Minister's reply. The amendment was prompted by the Society of Telecom Executives, a body of people who are very well aware of wage scales and matters of that kind. There is no mystery there. They are kept fully informed by the union of the movements in wage scales and would not face the problems which the Minister seems to think other people would face. The Minister may well be right that my amendment is unnecessary. It was intended to remove burdens from employers—an unusual thing for unions to want—as well as to clarify the general issue.

I am a little dismayed that the Minister has turned me down so clearly, but I am not surprised. I have been involved in a small way, as today, in trade union legislation matters over the past 10 or so years as they have been discussed in this House. Over that 10-year period I have noticed one very significant change. Noble lords who are older will remember that when we debated these matters in the early 1980s, the Government would sometimes accept amendments. The noble Lord, Lord Mottistone, will certainly remember having amendments accepted in the past, or at least smiled upon. Sometimes the Government would say that they could not accept an amendment but that they would take it away and look at it. But there has been a change. In recent years it has seemed to me that the Government's only reply to a debate on an amendment is "No". That has the advantage of clarity—"no" being the shortest word which conveys the Government's intentions to us. With those remarks, and a sense of dismay, I shall certainly withdraw my amendment. I shall take further advice upon the reply that has been given to it and the comments that have been made in relation to it, and see what can be done later on. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord McCarthy moved Amendment No. 12: Page 28, line 14, after ("withdraw") insert ("or not withdraw").

The noble Lord said: The amendment is minimal. Its object is to continue the line of argument which we opened up in Committee when we debated Amendment No. 55. At this point the Bill deals with what happens when subscriptions rise. It says that the worker must get advance notice and be told how much he must now pay. Secondly, he or she must be told that they can at any time withdraw the authorisation by giving notice in writing. That in effect is what is on the face of the Bill. We argued that that was an unbalanced way of putting the position; that at that point the worker should be told of both options; namely, that he could "withdraw or renew" the authorisation and it was up to him to decide which option to choose. The noble Baroness said that that was unacceptable. At col. 1625 on 18th March, she said that it was unnecessary because it was obvious; the worker would know that anyway. She said it was impossible; the worker had no right to demand to renew the check-off, which was entirely a matter for the employer. And, as the Government have done so far when in doubt, she produced the point about the law saying that one cannot challenge the check-off without leaving the union. We shall leave that one aside.

We did not claim to understand those objections and we do not claim to understand them now. But we pushed a number of alternatives. As noble Lords will remember, we said, if the Government would not accept our alternative, would they accept "withdraw or continue"? That was said to be unacceptable because it could place an obligation on the employer. We suggested "renew or not renew". We were told that that was unacceptable. We suggested "withdraw or not withdraw". There I thought we might have made an inch of ground because we were told that the noble Baroness and the Government would not think that that bore any relation to the clause. At least it is not impossible. It is not misleading. It is not contrary to the statute. It does not bring up the one about resigning from the union. So we come back with the phrase which is, I believe, based on that. It is very similar. We are saying "withdraw or not withdraw". That seems simple enough. If your Lordships do not like that, we can have "cancel or continue", or "renew or fail to renew". What we are trying to do is quite simple. We think that this is an unfair way of putting the position. Nothing that could be put in the Bill would be an option, an involvement or a liability on the employer to continue the check-off if he did not want to do so. Of course it would not. But it would be accepted by the trade union movement as something which looked roughly fair. On that basis I move the amendment.

Lord Boyd-Carpenter

My Lords, surely this is a wholly unnecessary amendment. If the Bill provides, as it does, that one "may" withdraw—not that one "shall" withdraw, but one "may" withdraw—surely it is perfectly clear that the use of the word "may" means that one need not do so, otherwise there is no point in using the word "may". Therefore to put in "or not withdraw" is simply to add words to the Bill and is, I think, very bad drafting.

6.15 p.m.

Lord Wedderburn of Charlton

My Lords, the amendment moved by my noble friend is surely an example of something that the Government said they did not want to have in regard to mergers; namely, one-sided notices. He suggests that the notice should be even-handed and, if it must be there, it should make clear what the options are. It is difficult to see why that should not be so, and why it should be one-sided. The noble Lord, Lord Boyd-Carpenter, reminds us that the Bill says "may". That is quite true. But the employment relationship, like some other relationships on occasion, is not one in which words used are necessarily neutral. The foreman may tell you that your best interests might be served if you did a bit more overtime. That is perfectly neutral. But if one writes it down and looks at it in this House, that is not necessarily so. What is asked for here is that if the employer has to do this unilaterally—I must say that I hope the noble Lord, Lord Mottistone, will pursue the question of just how this ought to operate by agreement—the notice to be given should be even-handed.

Baroness Denton of Wakefield

My Lords, in replying to the noble Lord, Lord McCarthy, on this amendment, perhaps I may say that we made it clear in Committee that this type of amendment was unacceptable and —I was about to say—"unnecessary". My noble friend Lord Boyd-Carpenter has made that point for us. We believe that the word "may" implies total even-handedness. It is a very straightforward matter. There is no statutory right for a worker to pay union subscription by check-off. The check-off is a voluntary arrangement, although it may also become part of a contract between the employer and the worker. The proposals in this Bill are concerned to ensure that there are proper safeguards to protect individual trade union members who opt to pay their union subscriptions in that way. A worker will be required to give his or her written authorisation to check-off deductions. Once given, that authorisation can remain in force for up to three years. But the worker has a right under the law to withdraw from the arrangement at any time. The Bill simply requires the employer to remind the worker of that right when giving a notice of increase in the subscription deduction. The worker does not have to reaffirm his or her consent in writing on receiving that notification. The clause operates on the presumption that deductions will continue to be made, in accordance with the worker's original written authorisation, throughout the three-year period unless either the employer or the worker actively takes steps to alter the position.

The precise wording of the notice of increase will be a matter for the employer. The only statutory requirements are that it should be made at least one month in advance; should specify the amount of the increase and the increased subscription deduction; and should remind the worker of his or her right to withdraw from the arrangement at any time. That is entirely consistent with the Government's policy. To specify that the notice must include a reminder also of the right not to withdraw is, as I said, unnecessary.

Indeed it is possibly arguable that the amendment would cause confusion and increase the administrative burden which noble Lords opposite have been anxious to minimise. The notification of some kind of notional or implicit "right not to withdraw" might give the impression to those receiving it that some action is indeed required if they wish to continue the arrangements. We could have required written consent to be given whenever the amount of check-off were increased, in which case there might have been some force in the arguments that have been put. But we have not done so and I do not believe that noble Lords opposite are pressing us to do so. In the circumstances as I have described them, there is no case for an amendment along the lines of the one we are considering.

Though some noble Lords opposite seem wary of this part of Clause 14, it is very simple. Individuals should have the right to withdraw from check-off arrangements whenever they wish. They should also be informed and reminded of that right. This provision will ensure that they are. I am sure that if the union is meeting their needs and providing the service and benefits for which they look, this provision is not something the unions need fear. I hope that the noble Lord is reassured about our position and will withdraw the amendment.

Lord McCarthy

My Lords, I am not reassured. The noble Baroness always has on me the same effect. She drives me back to Shakespeare. Lear said to Regan: "O, reason not the need". We know that it is not necessary. We say that it should be equitable and reassuring. Trade unions tell us that people will take it well and the absence of it is taken ill. But the Government do not care how people take things. Therefore I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 13 not moved.]

Lord McCarthy moved Amendment No. 13A: Page 29, line 6, at beginning insert ("subject to subsection (2) below,").

The noble Lord said: My Lords, this is a rather more substantial amendment., which is grouped with Amendments Nos. 17 and 105. This amendment is a rewriting of one that we tabled in Committee on Schedule 8. However, it was late at night and the amendment came so far on in Schedule 8 that we took pity on the Committee and did not move the amendment. Therefore we have, as it were, brought it forward through this paving amendment in Clause 14.

We are trying to extend the period through which the new system for operating the check-off will come in from one year to two years. On the face of the Bill, in Schedule 8, it says that, from the moment the Government invoke the order that brings into effect that particular part of the Bill, the trade unions have one year to create the new system. The amendment seeks to give them two years.

The argument is mounted on several grounds. The fact is that the Government have never argued for one year. The question of whether the period should be one, two or three years has not been debated. At least I cannot find any record of it in the proceedings of the other place. Our information is that it is the opinion of the trade unions that a period of one year from the notification of the new system places them in a difficult position.

In the first place the unions must seek facilities to find out exactly where the check-off exists and which employers and to what extent employers are prepared to co-operate to continue to carry out the check-off. The unions have to do that for every place of work and every employer where they have members. Where problems arise, as we think they may—this has been part of our argument, though I readily agree that the Government do not accept it—in that employers may say that the system is difficult to operate or time consuming with its periodic reauthorisations, unions have to try to persuade employers of the benefits of continuing with the check-off. Where they fail to get employers to agree to continue with it, they have to make alternative arrangements.

As we have said over and over again in this Chamber, people talk about resigning from unions when check-offs are cancelled. Of course, in the real world there are many alternative ways to do things. It would be possible for the large number of union members with bank accounts to subscribe by direct debit. That is happening in a considerable number of unions which are organising workers who have bank accounts—for example the First Division Civil Servants. I understand that all or very large numbers of them pay by direct debit. But, where direct debit is not possible, alternative arrangements will have to be found.

Many noble Lords will know that in the 1960s, before the spread of check-off, there was a system—a race—of trade union collectors. Most of them required some form of commission and, in order to carry out their work, had to make arrangements and get facilities to move about the factory, shop or office during the employer's time to collect subscriptions. All those arrangements would have had to be negotiated. Individual unions might find that they had to have a mix of different systems, including maybe some new systems as well.

If the Government want to indicate that this measure is not what it says and is not intended to undermine and reduce the influence and standing of trade unions; and if they want to assure us that it is designed to look after the individual members whom they want to see get fair play, they ought to be prepared to accept this very modest amendment, which is aimed at giving the unions a little more time. I beg to move.

Lord Rochester

My Lords, in the light of what the noble Lord, Lord McCarthy, said, it seems to me that one year is a short time for a union to be given to do all the work involved in obtaining the initial authorisation for the check-off arrangement. Therefore, I hope that the Government will view the amendment sympathetically. If they cannot accept it, I hope that at any rate they will offer an explanation which will satisfy noble Lords as to why the period is as short as that included in the relevant schedule.

Viscount Ullswater

; My Lords, I am grateful to the noble Lord, Lord McCarthy, for his explanation of these amendments. He will not be surprised if I say that the amendments are not such as I feel able to accept.

The arguments about Clause 14, with its new provisions on the check-off, have been well rehearsed. There is no need to go over that particular ground again. However, perhaps it is worth setting on the record—this perhaps is what the noble Lord, Lord McCarthy, wished from me—that the Government attach great importance to the new protection that will be offered by this clause to individual trade union members who pay their subscriptions through the check-off. It is therefore fundamental to the clause that all those who pay their subscriptions in this way —and not just those new to the arrangement after the clause comes into effect—should benefit from the new protections at an early stage.

At the same time, we recognise that employers who already operate the check-off will inevitably need some time to adjust to the new requirements for those who are already covered by check-off arrangements. That is why we decided that it would be appropriate to allow the period of a full year for those already paying union subscriptions in that way to be given the opportunity to give their written consent. This is the provision that has been made in Schedule 8 to the Bill. The one-year period will also give the employer plenty of time to establish systems for giving advance notice of any increase to those from whom he makes deductions. Of course, everyone will have the right to withdraw from the check-off at any time as soon as the clause comes into effect: that is entirely consistent with the new protections we are introducing.

Whatever the good practice of certain employers, the fact is that in certain cases individual written consent is not a necessary legal prerequisite of the making of check-off deductions. The clause puts right that unsatisfactory position. It is only right, therefore, that we should extend it as a legal right to all those already covered by the check-off at a relatively early date. Moreover, many people covered by the check-off when the clause comes into effect, even if they did give written consent in advance, may have done so many years ago. There is therefore no logic or justification in the argument that people already covered by check-off should have to wait a further two years before they are given the opportunity to reconsider and, if they wish, reaffirm their consent to the arrangement.

I certainly do not accept the argument that one year places too heavy a burden on employers and that they will not have time to make the necessary adjustments. A year is a more than adequate period, and the clock only starts ticking after the clause comes into effect, itself after this Bill's well publicised passage through the House and attainment of Royal Assent. Employers will have had plenty of notice of what is required of them. Effectively, they will be given the opportunity to plan for something that will probably not need to be completed until the autumn of 1994.

I am therefore unable to accept the amendment. It would introduce an unacceptable delay into the implementation of the important provisions in the clause. I hope that my words reassure the noble Lord, Lord McCarthy, that employers will have sufficient time to make the arrangements, and that he will be persuaded to withdraw the amendment.

6.30 p.m.

Lord Wedderburn of Charlton

My Lords. before the noble Viscount sits down, I should like to ask a question. I may have misunderstood him and perhaps he will correct me if I am wrong. His argument seems to rest upon the notion that we need the new clause in order to give employees the opportunity to reaffirm or withdraw. That is a central element of government argument and one must ask again—believing that the notion is wrong and that there is no need for a new clause to allow people to withdraw from check-off, which can be done immediately—whether the noble Viscount has any legal basis for that proposition. It has been repeated both by him and his noble friend. On these Benches we have said continuously that in terms of the law it is wrong.

Viscount Ullswater

My Lords, I believe that we have covered this area on a number of occasions. My noble friend and I have sought to say that there are occasions when a collective agreement is in force when, first, an employee may not have given his personal written consent to that and, secondly, if the rules of the union are such that that is also part of the collective agreement, then the employee would not have the opportunity of withdrawing from check-off.

I appreciate all the arguments put forward from the Front Bench opposite and other parts of the House. In many instances, perhaps 99 out of 100, the unions will make accommodation for the member if they so wish. We have said that. We have said that the legal position is such that there may be some instances where the only remedy an employee can take, as the noble Lord from the Front Bench opposite said, is to resign from the union. That is a position we wanted to obviate.

Baroness Seear

My Lords, can the noble Viscount quote any collective agreement where that is in fact the case?

Viscount Ullswater

My Lords, I do not have a case with me. There are many instances where collective agreements are changing from day to day. It would not be right to burden the House with such detail.

Lord McCarthy

My Lords, can the noble Viscount tell us what such a collective agreement would say? It would regulate that most unregulated thing in collective agreements—the relationship between a union and its members. It would ask the employer to agree that, if the individual withdrew from check-off, then the union should not volunteer an alternative way to belong. It is a world of madness. Why should any union sign such an agreement or an employer want it? It is nothing to do with employers.

Viscount Ullswater

My Lords, with the leave of the House, our replies have not stressed whether we can quote instances, but what is the legal position. In this House we are dealing with what the law states. I have said what the law states. That is how I identify to noble Lords the current position of the law and the situation that we intend to change by the Bill.

Lord McCarthy

My Lords, I suppose I am not surprised. I would be more pleased if the Minister was less grateful and more agreeable.

It is true that we have not rehearsed the one-year rule. That is a defect on our part. Both in this House and in another place we allowed the whole question of a period of grace—if I may call it that—that the Government have given the trade union movement, to go by default. On the other hand, the Minister knows that it has not gone by default in negotiations with the Trades Union Congress and the Government. He knows that the Trades Union Congress and the individual unions have made it clear that they believe that it will be extremely difficult to implement this within 12 months.

The Minister says that employers will know how long they have to move. My information, which seems to be reasonable, is that employers will not move until they have to. If the Minister went to an employer today and said, "You know there is a Bill; you know it is coming and that you have a year", that employer would not want to know. Employers are dealing with the difficult problem of making their businesses survive. They will get round to it in the end. but how long they will give the union and what can be done in the time at their disposal is of concern. However, the Government are not concerned about the matter.

When the Government make so much, as they do continually, about all the people who have never agreed to be on the check-off, and say that they want to give them rights, it suggests that we are back to our old friend from Bartholomew Fair and his enormities. It suggests that enormities exist. In the Government's mind there must be thousands of trade unionists who want to leave unions but who cannot do so for some reason that is not explained, or who cannot leave the check-off without leaving unions which they do not want to do for some reason that is not explained. It is only when the Government on their white horse come galloping in with this provision that all those people will be able to leave their unions. That is nonsense.

The Government are not giving rights to anybody. Anybody who wants to can leave the union tomorrow. The Government arranged that and from their point of view it was right. But they cannot quote it at us. That was done when the Government abolished the closed shop. That made it possible for anybody to leave a union at any time and the Government are proud of that. But they cannot come trotting along here saying, "We need another piece of legislation to free people so that they can leave unions". That is not the present circumstance. This is a situation where unions are asking for a reasonable time to introduce a new system. We calculate that 6.25 million trade unionists are on check-off. I believe that they deserve a little time and that I should test the mood of the House on the issue.

6.38 p.m.

On Question, Whether the said amendment (No. 13A) shall be agreed to?

Their Lordships divided: Contents, 58; Not-Contents, 117.

Division No. 4
CONTENTS
Airedale, L.	Galpern, L.
Blease, L.	Graham of Edmonton, L.[Teller.]
Boston of Faversham, L.
Carmichael of Kelvingrove, L.	Gregson, L.
Cledwyn of Penrhos, L.	Grey, E.
Clinton-Davis. L.	Hampton. L.
Dean of Beswick. L. [Teller.]	Hollick, L.
Diamond, L.	Holme of Cheltenham, L.
Donoughue, L.	Houghton of Sowerby, L.
Dortnand of Easington, L.	Hughes, L.
Eatwell, L.	Jay of Paddington, B.
Falkland, V.	Jeger, B.
Fitt, L.	Judd. L.
Gallacher, L.	Kilbracken, L.

Lockwood, B.	Scanlon, L.
McCarthy, L.	Seear, B.
McGregor of Durris, L.	Sefton of Garston, L.
Mclntosh of Haringey, L.	Serota, B.
Mallalieu, B.	Shackleton, L.
Mason of Barnsley, L.	Stoddart of Swindon, L.
Merlyn-Recs, L.	Strabolgi, L.
Molloy, L.	Taylor of Gryfe, L.
Nicol, B.	Tordoff, L.
Peston. L.	Turner of Camden, B.
Pitt of Hampstead, L.	Wedderburn of Charlton, L.
Prys-Davies, L.	Whaddon, L.
Rea, L.	White, B.
Redesdale, L.	Winchilsea and Nottingham, E
Richard, L.	Young of Dartington, L.
Rochester, L.

NOT-CONTENTS
Acton, L.	Kenilworth, L.
Ailesbury, M.	Kimball, L.
Aldington, L.	Kinnoull, E.
Alexander of Tunis, E.	Lane of Horsell, L.
Annaly, L.	Lauderdale, E.
Arran, E.	Leigh, L.
Astor, V.	Lindsay, E.
Auckland, L.	Lindsey and Abingdon, E.
Banbury of Southam, L.	Long, V. [Teller.]
Belstead, L.	Lucas of Chilworth, L.
Biatch. B.	McColl of Dulwich, L.
Boardman, L.	Mackay of Ardbrecknish, L.
Borthwick, L	Mackay of Clashfern, L.[Lord Chancellor.]
Boyd-Carpenter, L.
Brabazon of Tara, L.	Manton, L.
Brentford, V.	Margadale, L.
Brougham and Vaux, L.	Marlesford, L.
Buckinghamshire, E.	Merrivale, L.
Cadman, L.	Mersey, V.
Carnegy of Lour, B.	Milverton, L.
Carnock, L.	Mottistone, L.
Chalker of Wallasey, B.	Mountgarret, V.
Chelmsford, V.	Moyne, L.
Clark of Kempston, L	Munster, E.
Colnbrook, L.	Murton of Lindisfarne, L.
Colville of Culross, V.	Napier and Ettrick, L.
Cranborne, V.	Norrie, L.
Cumberlege, B.	Orkney, E.
Darcy (de Knayth), B.	Orr-Ewing, L.
Davidson, V.	Oxfuird, V.
Demon of Wakefield, B.	Pender, L.
Derwent, L.	Rankeillour, L.
Dundonald, E.	Rennell, L.
Eccles of Moulton, B.	Renwick, L.
Elles, B.	Rodger of Earlsferry, L.
Elphinstone, L.	Romney, E.
Faithfull, B.	Saint Albans, D.
Ferrers, E.	St. Davids, V.
Finsberg, L.	St. John of Bletso, L.
Flather, B.	Saltoun of Abernethy, Ly.
Fraser of Carmyllie, L.	Skelmersdale, L.
Fraser of Kilmorack, L.	Stewartby, L.
Gardner of Parkes, B.	Strathclyde, L.
Geddes, L.	Strathcona and Mount Royal, L.
Gibson-Watt, L.
Glenarthur, L.	Strathmore and Kinghorne, E.[Teller.]
Goschen, V.
Gray of Contin, L.	Sudeley, L.
Hacking, L.	Swansea, L.
Harmar-Nicholls, L.	Thomas of Gwydir, L.
Harmsworth, L.	Trefgarne, L.
Hemphill, L.	Trumpington, B.
Henley, L.	Ullswater, V.
Hives, L.	Vinson, L.
Holderness, L.	Vivian, L.
HolmPatrick, L.	Wakeham, L.[Lord Privy Seal.]
Hooper, B.
Hothfield, L.	Whitelaw, V.
Howe, E.	Wynford, L.
Hylton-Foster, B.	Young, B.
Jeffreys, L.

Resolved in the negative, and amendment disagreed to accordingly.

6.45 p.m.

[Amendments Nos. 14 to 17 not moved.]

Clause 16 [Requirement of postal ballot]:

Baroness Turner of Camden moved Amendment No. 18: Page 30, line 32, at end insert: ("( ) In cases where less than 50 members are to be balloted, each person entitled to vote must be given either—

1. (i) a convenient opportunity to vote by post, or
2. (ii) an opportunity to vote immediately before, immediately after, or during his working hours at his place of work or at a place which is more convenient for him.").

The noble Baroness said: My Lords, in Committee we sought to retain the right of union members to have a workplace ballot on strike action. The Government's position in this Bill is that henceforth all strike ballots must be conducted by postal means. The reasons given by the Government for the change are not exactly compelling. The Government were themselves responsible for introducing legislation giving the option of either workplace or postal ballots in the case of industrial disputes. That was as recently as 1988. No evidence that I am aware of—it was certainly not advanced by the Government in Committee—has arisen since 1988 to warrant such a change of view in such a very short timescale.

As recently as the 1987 Green Paper the Government were saying that they accepted that postal ballots were less suitable than workplace ballots in the case of potential strike action. Nothing surely has changed since that time. Everyone agrees that workplace ballots have significantly higher turnouts. For some reason or other, that does not commend itself to the Government as an argument, although if the Government are concerned with ensuring that decisions are based on as wide a mandate as possible it is surprising that they do not consider that that has any importance. Indeed, the Government's own code of practice on industrial action ballots makes it clear that secret workplace ballots are particularly suitable where speed of obtaining the voters' response is of the essence.

Industrial action ballots are different from other kinds of ballots or elections where the time factor may not be quite as important. In his response in Committee the Minister appeared to be arguing that, since 1988 election ballots had to be fully postal, now was the time to bring industrial action ballots into line. But everyone with experience of industrial relations knows that ballots about strikes are about workplace issues of some immediacy. It is necessary not only for union members but also for employers to know the results as quickly as possible.

It is accepted on all sides—or at least it was—that workplace ballots, held under proper, secret conditions, are much more likely to achieve a quick result. We have not been prepared to let the arguments go entirely, even though we made no progress in Committee. We have come back with another amendment which would allow workplace balloting in cases where the numbers to be balloted are small. We have set the figure at 50.

Why small numbers? The Minister may well say that there is no logic in making this distinction. However, I believe that the Government themselves were at one time considering a threshold figure—a figure of 50, I believe, although 30 was mentioned on one occasion—and I do not understand why they have decided to depart from that conception. If there is to be postal balloting for large industrial disputes, which could have a major effect on public or private services, surely the same conditions should not apply in the case of much smaller groupings of members, often employed in small undertakings. For such undertakings the arguments are surely strong; that everyone, the employers and the employees, need to know the result as quickly as possible. The employers themselves may not have the resources to cope with a continuing situation of instability. They, even more than the large organisation, need to know as soon as they possibly can what the result of a test of employee opinion is.

Moreover, with relatively small numbers of people, it is much easier to organise secret and safe ballots on site. I hope therefore that the Minister will be able to tell us that he is able to accept at least some of the arguments we have advanced. I was involved, during the time I was a union official, with workplace balloting held on site. My experience was that ballots were always conducted in a rigorously safe, secret and acceptable way. The employers provided facilities. Very often, the numbers to be balloted were relatively small. On the other hand, very tight security was possible with a small number of people involved. If the Government are concerned about security, as appeared to be the position when we discussed the matter in Committee, surely it is understandable that where there are smaller numbers it is much easier to evolve a safe and secure system.

For those reasons, I hope that we shall have a favourable response from the Minister. We have tried, as we have with all our amendments this evening, to cope with some of the arguments advanced by the Government in Committee. We have not come back with exactly the same arguments and exactly the same types of amendments. We have looked carefully at what was said by the Minister in Committee and have tailored the amendments we have put forward to your Lordships today directly to meet some of the arguments advanced by the Minister.

This amendment comes within that category. We have set the number at 50. We believe that that is a reasonable number and that if the Minister were to look favourably upon it at least a message would he sent to the trade union movement outside, which feels very strongly that it has been "sorted out" by the Government and that it has been the recipient of extremely hostile, indeed punitive, legislation. It would send out a signal to unions and their members that the Government are prepared to be reasonable and to listen to some of the arguments advanced on behalf of unions and their members. With those comments, I beg leave to move the amendment.

Lord Boyd-Carpenter

My Lords, I cannot see the logic of having a differential when the ballot is over or under 50. I feel that this is an unnecessary addition to the Bill. In addition, I am intrigued by the words of the postal alternative: a convenient opportunity to vote by post. It seems to me a formula that could give rise to infinite dispute as to whether a convenient opportunity was, or was not, given. I take it that "a convenient opportunity" does not mean a stamped addressed envelope.

Baroness Turner of Camden

My Lords, will the noble Lord give way?

Lord Boyd-Carpenter

My Lords, of course.

Baroness Turner of Camden

My Lords, is the noble Lord aware that, a convenient opportunity to vote by post", is the wording used in previous legislation?

Lord Boyd-Carpenter

My Lords, yes, indeed. It seems to me, and I abide by it, that it is a phrase which can give rise, or could give rise, to quite an amount of argument. It is quite unnecessary. However, what is really unnecessary is to make an arbitrary distinction between cases in which the ballot may be over or under 50.

Lord Finsberg

My Lords, the noble Baroness, in introducing the amendment, said that everyone who was engaged in industrial relations would agree that it is a good thing to have workplace ballots. I have had 30 years' experience of industrial relations in the workplace, having to deal with trade unions of all kinds. I do not agree with her. All too often one has had the spectacle I go back to my early days when I was working down the coal mines and had nothing to do with industrial relations—of so-called "free" workplace ballots where there was intimidation and things of that sort. People who saw what happened then know how true that is.

The noble Baroness says that most trade unions act correctly. I agree with her. Unfortunately, when one is legislating one has to be certain that one does not leave loopholes for unions like the NUM or the old electrical trades union, which in those days employed every possible means of perverting decent industrial relations. I believe therefore that it is not necessarily right to rely upon workplace ballots. A workplace ballot can be coloured by the swift emotion of something that has gone wrong. In my judgment, it is better to have a postal ballot, which gives people the opportunity of considering what the issue really is.

Then, of course. there is the idea of 50. Why not 48, or 52? The number has been drawn out of a hat merely to make it different from the argument which was lost in Committee. I hope very much that the Government will not accede to the ingenious attempt to re-insert the "Trojan horse" that many of us were glad to see disappear.

Lord Wedderburn of Charlton

My Lords, however experienced or inexperienced in industrial relations law one may be, the Government are the origin, as Ministers know, of the proposal that a different rule should apply to workplaces where there are less than 50 union members being balloted. The 1991 White Paper, in paragraph 3.21, says that the Government, propose that an industrial action ballot should have to be conducted by fully-postal voting in every case where more than 50 union members are entitled to vote. There was discussion of the possibility of semi-postal balloting in smaller workplaces and what would be be appropriate. The suggestion of my noble friend is that the Government's belief, based upon the existing state of knowledge and research in the area, was that workplace ballots, no doubt with considerable requirements in regard to secrecy and so on, on the whole produced a higher turn-out. That was the suggestion in the research carried out in the early 1980s by Undy and Martin. I remember asking the Minister at some point in Committee whether there was further research that went the other way.

If you really want to have a high turn-out and a ballot conducted in such a way that it is likely to reflect the opinions of the members, then the Government's conclusion in 1991 was that, at any rate in the smaller areas, you could do that satisfactorily by a workplace or semi-postal workplace ballot. What the Government have never explained is, first, whether they have any further research the other way and, secondly, why they have changed their mind about smaller workplace ballots.

Baroness Seear

My Lords, I support the amendment. In small concerns, if a row blows up, it needs to be dealt with quickly. It is much better dealt with through a workplace ballot. Of course there may be abuses, but there can be abuses in any system that you adopt. That is not an argument that really holds very much water.

We know that things have gone wrong. They have gone wrong on postal ballots as well as on workplace ballots. This is a sensible amendment. As the noble Lord, Lord Wedderburn, has said, the Government favoured something of the sort not so long ago. If they would change their minds on things that are worth changing their minds on instead of things that are not, we may well have got on a great deal better.

7 p.m.

Lord Stoddart of Swindon

My Lords, I too should like to support the amendment. I would not have spoken except that the noble Lord, Lord Finsberg, got to his feet and gave us the benefit of his personal experience in industry, which of course we value. Perhaps I could give him the benefit of my experience in industry. When I worked at the power station we often had workplace ballots, which in fact I ran, and ran successfully. There was no question of the secrecy of the ballot being breached, nor was there any intimidation. They worked successfully.

If we can run them at workplaces where there are 250 people, and run them successfully, I am sure that we can run them, and that it is desirable to run them, at workplaces where there are only 50 people. Because the ballot would not usually take place about wages—they were probably fixed by the wages council, which we still have but not for much longer, or perhaps by wider collective bargaining—we would be talking about disputes that were local, and very local, and which probably by the time the postal ballot had taken place would have been settled. Therefore, everybody would have embarked on a great deal of time and money wasting. There are good reasons why we should accept this amendment for small concerns.

I believe that employers would be satisfied with that as well. Imagine the entrenched positions that could occur if there was a postal ballot and a majority had voted for industrial action when in fact the need for industrial action had passed. The men may well feel, "Well, we voted for this, we must now do it". It is ridiculous to have postal voting in circumstances such as this. The Government ought to see the benefit of what, as we have heard, they themselves were putting forward at earlier stages of their industrial attack on trade unions and they should agree to this amendment.

Baroness Denton of Wakefield

My Lords, first, let me say that I was intrigued to hear earlier this afternoon that I drove the noble Lord, Lord McCarthy, to Shakespeare. I am sorry that on this occasion I shall not have the benefit of learning to what I drove him.

I have listened carefully to the noble Baroness's arguments. I would be the first to acknowledge her direct experience with unions. But I make no apology for the fact that my reasons for resisting this amendment are essentially the same as those already expressed.

Perhaps I should begin by explaining why we consider it important to ensure that union members have the protection of fully postal voting in an industrial action ballot. First, we believe that only fully postal voting can guarantee members that the ballot will be conducted in a proper manner. It is important that those entitled to vote in an industrial action ballot should be free to do so away from the pressures which might otherwise be brought to bear if that ballot was conducted in the workplace.

Today, as on many previous occasions when we have discussed the Bill, noble Lords and noble Baronesses have indicated that that is not their experience, but my noble friend Lord Finsberg indicates today that it is his, and as the noble Baroness said there will always be instances of abuse to any system. We believe that postal voting has a minimising effect. The temperature of the argument is not related to the size of the vote.

Secondly, only fully postal voting gives union members greater assurance that the ballot is free from the kind of impropriety which might occur—I stress "might"—if ballot papers were collected from the workplace, or returned for counting, otherwise than by post. There is no overriding reason to suppose that the pressures which might be brought to bear during workplace voting will be any less where only a small number of members are involved—indeed, they may well be greater.

The noble Baroness, Lady Turner, suggested that it may be that in this area the employers did not have the experience or the capacity to deal with these issues. I would point out that instances where the union membership of a particular union voting on this issue was 50 or under would not only apply to smaller employers. But, as my noble friend pointed out, there are no sound reasons for the setting of a threshold, which, at whatever level, would be arbitrary and could give rise to anomalies.

We remain convinced that only fully postal voting for an industrial action ballot can give members sufficient assurance that they have cast their vote in a properly conducted ballot. We do not believe that it is unreasonable to require fully postal voting for all industrial action ballots, and I hope that the noble Baroness will withdraw her amendment.

Baroness Turner of Camden

My Lords, I do not at all accept what the noble Minister has said in response to the debate on this amendment. First, she talks about rights. In my amendment there is an alternative. It says: (i) a convenient opportunity to vote by post, or

(ii) an opportunity to vote immediately before, immediately after, or during his working hours at his place of work or at a place which is more convenient for him". I should have thought that that gave individuals a right. It does not take away a right; it gives a right. It is a right to have the opportunity to vote at work when it may be very much more convenient than to have it sent to your postal address. That may well be the case —and I did not make this point earlier—where the workforce may be a travelling or itinerant one. That is not an unusual situation nowadays.

I do not accept the arguments about intimidation. That experience probably arises from a good many years ago. The Government themselves were responsible for introducing the concept of workplace balloting. The trade union movement at the time, certainly the TUC, was quite willing to accept this and developed its policies around workplace ballots on the basis that this was likely to involve a much higher turnout than postal balloting, and that has certainly proved to be the case.

Moreover, as my noble friends have said, the disputes that we are talking about are often small and local ones, obviously involving, from the amendment, relatively small numbers of people, and obviously small companies. This is a sensible amendment. I regret that the Government have seen fit to trot out arguments in opposition to it that certainly do not seem to me to hold water, and I am sure that numbers of your Lordships will join with me in that sentiment. I do not intend to press this at this point in the Bill. I simply express my concern and regret that, although this reasonable amendment has been advanced by us at this point in the discussion of the Bill, the Government have nevertheless seen fit to adhere to their—

Lord Stoddart of Swindon

—reactionary stance, my Lords.

Baroness Turner of Camden

My Lords, my noble friend is absolutely right— the reactionary stance that they have shown throughout the discussions on this Bill. I shall not advance, as would my noble friend Lord McCarthy, some quotation from Shakespeare on this occasion, but I shall say that it sometimes seems that the Government make a lot of fuss—much ado about nothing—when they talk about intimidation. I have not heard from the other side any examples of intimidation to justify coming forward with such an enormous, wide-ranging and sweeping piece of legislation as we have been discussing this evening. Having said that, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Viscount St. Davids

My Lords, I beg to move that further consideration on Report be now adjourned. In moving this Motion, I suggest that the Report stage begin again at 8.10 p.m.

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