Trade Union Reform and Employment Rights Bill

HL Deb 24 May 1993 vol 546 cc12-67

3.10 p.m.

The Parliamentary Under-Secretary of State, Department of Employment (Viscount Ullswater)

My Lords, I beg to move that the House do now resolve itself into a Committee (on Recommitment) pursuant to the resolution of Thursday last.

Moved, that the House do now resolve itself into Committee (on Recommitment).—(Viscount Ullswater.)

The Lord Chancellor

My Lords, the Question is that the House do now resolve itself into Committee (on Recommitment) pursuant to the resolution of Thursday last.

Baroness Turner of Camden

My Lords, we are not, of course, on this side of the House opposing that the House should go into Committee on this section of the Bill as that was agreed by your Lordships last Thursday. Indeed, we had been pressing for that ourselves through the usual channels ever since we understood precisely what was involved, or likely to be involved, as we did not see the text of the new clause until late last Wednesday.

I would, however, like to take this opportunity to place some remarks on the record. The noble Viscount said that, the Court of Appeal reached a judgment last Friday which held an employer to be in breach of the law now contained in Section 146 where he had offered financial inducements to his employees to move away from collective negotiation to personal contracts. It was never the Government's intention, when the current law on action short of dismissal was introduced, that it should be interpreted in this way or that it should interfere with an employer's freedom to seek to make such a change".—[Official Report, 6/5/93; col. 860.] The Minister said it was the intention to introduce an amendment to clarify the law in that area. At that time the text of the Court of Appeal's decision was not available; nor was it known whether or not there would be an appeal to the House of Lords. The Government had apparently made up their mind without knowledge of these important points. It is hardly surprising, therefore, that a number of us went away after 6th May to try to find out rather more about this matter and seek to ascertain why it was so urgent for the Government to take the most unusual step of introducing an amendment with apparently far-reaching implications very late in the passage of a Bill through both Houses of Parliament. Indeed it could hardly be later than the Third Reading.

When we discovered the Government's intention we were even more disconcerted and, indeed, gravely disturbed at what we on this side of the House felt to be an abuse of parliamentary procedures. It transpired that the issue was by no means a new one and not one that in our view needed urgent clarification. There had been previous decisions in line with the Court of Appeal decision, which itself was fully in line with Section 146 of the 1992 Act. That was simply a consolidation of what was in the 1978 Act, which itself consolidated the 1975 Employment Protection Act. Therefore, the provision we are discussing has been established in law for a long time and the Government have had ample time to change it, if they wished to do so, through normal processes. What the Government appeared to be doing was attempting to write into legislation what apparently was a maverick decision of the Employment Appeal Tribunal. In any event, that decision was not unanimous and a member of the tribunal had issued a dissenting opinion.

The Court of Appeal decision which overturned the EAT was, on the other hand, a unanimous judgment. What is at issue here is a matter of the greatest importance. Section 146 of the 1992 Act is a piece of legislation which is fully in accord with the UK's international obligations as a signatory of ILO conventions. It specifies that an employee has the right not to have action short of dismissal taken against him as an individual by his employer for the purpose of preventing or deterring him from being or seeking to become a member of an independent trade union, or penalising him for so doing. As recently as 25th March of this year the Minister spoke with approval of this particular section of the law. He said: Secondly, the law already affords protection for individuals whose employer might dismiss or discriminate against them on the grounds of union membership or activities. That protection is a real protection. It applies regardless of the length of time which an employee has been in employment with the employer. An employer does not have a free hand to discriminate against employees who are union members".—[0fficial Report, 25/3/93; col. 472.] On 25th March the Government were still speaking of that section of legislation with approval. There has been no consultation that I am aware of with any interested parties, certainly not with the TUC, whose members are, of course, likely to be affected by any proposed amendment to Section 146 of the 1992 Act. Therefore, while we are pleased that there is to be recommitment, we wish to place on record in the strongest terms our objections to the procedures followed by the Government with regard to this new clause. We shall have our discussion in Committee and then there will be provision for a Report stage; but that will be held all in one afternoon so that amendments which noble Lords have tabled expecting them to be properly debated on Third Reading, following a Report stage held in the normal manner, will be put back and taken very much later. I deeply regret that the Government have decided to go down this path. I had hoped they would not proceed but unfortunately they have done so. I wish to place on record the objections of this side of the House.

Lord Rippon of Hexham

My Lords, I wish to express my own concern at what has happened. Only this morning I received a letter from Mr. Willis, the General Secretary of the TUC. He wrote: I am writing to you as the Chairman of the Hansard Society's Commission on the Legislative Process to express the TUC's concern at the Government's decision to move a significant amendment to the Trade Union Reform and Employment Rights Bill at the Third Reading Stage in the House of Lords. I believe the Government's action is an affront to normal Parliamentary procedures and a clear illustration of the need for changes in the legislative process along the lines of the recommendations put forward by the Commission". I express no views about the merits of the new clause which the Government have proposed but I find it very disturbing that the Court of Appeal should issue its unanimous judgment on 30th April on two cases—I do not know whether there was any question of their going to the House of Lords—and then on 6th May for the noble Viscount to say that he would move an amendment. That amendment was published on 20th May for debate on 24th May. I share the views expressed by Mr. Willis that the hasty response to the judgment was made before anyone had seen the full transcript of the Court of Appeal's ruling and without waiting to see whether either case would proceed to the House of Lords. The amendment was published on Thursday 20th May for Third Reading debate in this Chamber on Monday 24th May. The text of the amendment was not available until the last possible moment before the debate. Although I understand the Government have allowed a separate Committee stage for the amendments today, this cannot be considered an effective parliamentary scrutiny.

Furthermore, there has been no prior consultation with interested parties. I am bound to say I cannot see any justification for legislating in this way. We had a valuable debate last Wednesday on the Salisbury rules and some of the other practices of this House. One of the points that was made not only by the Hansard Society but by a number of your Lordships was that in any event there was usually insufficient time between the various stages of Bills for Members of this House, and certainly those outside, to consider what is happening. This is a rather disturbing example of the way in which we tend to legislate.

Lord Rochester

My Lords, I support the remarks of the noble Baroness, Lady Turner, and the noble Lord, Lord Rippon. I wish to add a few words to what I said last Thursday when the noble Viscount, Lord Ullswater, repeated what he had said on Report; that is, that the recent judgment in the Court of Appeal in two cases had confirmed that the law was giving rise to difficulties and confusion and that it was important for the Government to act quickly to make the law clear. I believe an important principle is at stake here. It is not for the Government but for this House in its judicial capacity to clarify the law if called upon to do so. In introducing this amendment the Government are in my view seeking not to clarify but to alter the law to the advantage of employers and the detriment of employees.

Last Thursday the noble Viscount, Lord Ullswater, thanked the noble Baroness, Lady Turner, and myself for our constructive and helpful approach to this matter. The noble Lord the Leader of the House added that he was extremely grateful to us for agreeing —albeit reluctantly—that the course proposed in the government Motion was probably the best way in which to proceed. I am sorry that the noble Lord the Leader of the House is not present. I have told him that it would have been more accurate to say not that we agreed this was the best course but that we felt obliged to acquiesce in the Government's decision. The Government may succeed in forcing through their amendment this afternoon. All we can do is to protest at this position, and that I do most strongly.

Lord Harmar-Nicholls

My Lords, I know that we have no rigid rules in this House which one can be accused of breaching, but I question whether this is the time for this point to be raised. We rely upon self-discipline. That is the only way in which we can make sense of our discussions. We must use our discretion when we raise matters. However, on this particular matter we are not in Committee and we are not in the Report stage. All of a sudden, out of the blue, the noble Baroness, Lady Turner, has raised this issue. I do not know whether she gave notice to my noble friend the Leader of the House that she intended to do so. She has given no chance for anybody who could deal with the matter to be present on the Front Bench.

While it can seem a good publicity ploy to take advantage of the circumstances, it is wrong to misuse the absence of rules so to distort the way we do our business that we do not know where we are. No one can answer my question but, for the record, I want to ask whether this is the correct time for this point to be made when it could properly have been raised when the amendment itself was on the table for discussion. To jump the gun in this way is to twist the procedures of this House in a way which is not in the interests of the House.

Lord Ennals

My Lords, I am sure that we all heard what the noble Lord, Lord Harmar-Nicholls, said. He asked whether this is the right time to discuss the matter. There is no other time when we can raise this point of whether it is right to proceed with the matter now.

I was not present on Thursday. I have only become aware of the situation today. I agree with everything which the noble Lords, Lord Rippon and Lord Rochester, and my noble friend on the Front Bench said.

I must declare an interest. In 1939 I was secretary of my local chapel of the National Union of Journalists. That was some time ago, but I have an interest in the subject and in the views which that union may express about the propriety of the Government's behaviour. I believe that the Government should think again about the matter.

How can it be proper to rush through such far-reaching legislation without any opportunity for consultation whatever with those who are concerned by it and about it? Like the noble Lord, Lord Rippon, I find the way in which this Government proceed, making decisions on the hoof without consultation, quite intolerable. I have mentioned consultation, but how can the Government expect there to be respect for the law when they seem to defy the due deliberations of three Lords Justices on a point of principle, especially as the case may yet go to the Court of Appeal or to this House? It is quite wrong that the issue should be dealt with in this way.

Having heard strong representations both from our Front Bench and the Liberal Democrat Front Bench I say that in principle this is the wrong thing to do. I plead with the Government to think again before they proceed with what I believe is a very rushed, totally unnecessary and unprincipled action.

Lord Campbell of Alloway

My Lords, for the record, I should like to dissociate myself from the observations made to your Lordships by my noble friend Lord Harmar-Nicholls. I shall assuredly not enter into the merits of the debate. I rise only to deal with the question of the order of debate.

There were two issues which I had to try truly to understand. One was the reasoning of the judgment. I had only half an hour to do so. I need very much more time because the issue goes back over a long period. I shall not go into details, but I need more time, although I am a fairly fast worker. I also wanted to see how the opt-out provisions of the Social Chapter could affect the nature of the amendment. I have not had a moment to consider that aspect.

This is what happens if one proceeds in this way. Of course we shall do the best we can. It is a lovely day and we shall do so with good will. However, there are problems and I merely rise to point out the difficulties which I had in dealing with the matter objectively.

Lord McIntosh of Haringey

My Lords, it is right that we should follow the noble Lord, Lord Campbell of Alloway, particularly on his birthday, on which I congratulate him.

Like other noble Lords, I do not wish to comment on the merits of the Government's amendment or the amendments to it. My noble friend Lady Turner is far better qualified than I to do so. However, I want to respond to what the noble Lord, Lord Harmar-Nicholls, said.

The Motion moved by the noble Viscount, Lord Ullswater, is a debatable Motion. It should be stated clearly to the House that this is not only the right time but the only real opportunity for us to debate whether it is proper for the amendment to be put to this House in this way at Third Reading.

It may be said that we have acquiesced in the procedures. That is the case. I understand that the usual channels have acquiesced in the procedures, and my noble friend Lady Turner confirmed that point. We acquiesced only in the knowledge that it was the firm intention of the Government to push through the amendment come what may. The concession of recommitment to Committee is only a concession to us. It has a certain amount of virtue but, as the noble Lord, Lord Campbell of Alloway, said, not very much virtue because those who are involved deeply with the issues have not had an opportunity to investigate the matter fully.

All Members of your Lordships' House should be clear that it was proper for my noble friend Lady Turner to have risen and to have raised the issue. The propriety of her action has been confirmed by many speakers in this debate.

Lord Howie of Troon

My Lords, I have been approached by two trade unions in relation to this matter. One was the Society of Telecom Executives and the other the National Union of Journalists, of which I have been a member for only 20 years, unlike my noble friend Lord Ennals whose membership goes back further. The significant point which they raised in their approaches to me is that neither union, both of which are greatly concerned with the matter covered by the amendment, has been properly consulted. They have not been consulted at all.

I suggest to the Government that the procedure proposed for this afternoon is outrageous. I do not care whether or not it has been agreed through the usual channels. It remains outrageous, for the following reason. We are expected to discuss a recommittal stage for a time. Then there will be a brief period, during the Statement, in which amendments can be put down for the Report stage. After that there will presumably be a brief period before we move on to the Third Reading, during which no further amendments can be put down. We would normally expect that after Report stage we would be in a position to put down amendments for the Third Reading if that were appropriate.

It may well be that after the Committee stage I shall feel obliged to consult the Society of Telecom Engineers and the National Union of Journalists. I shall have very little time in which to do so. Again, after Report stage I and other colleagues in this House may wish to consult appropriate trade unions or the TUC. We shall have no time to do that.

I should like to suggest to the Government an alternative proposal to the one which is before us today. I suggest that we take the recommitment stage as proposed and then adjourn the House for a period which is long enough to allow proper discussion and consultation to take place. We should then hold the Report stage later. The Third Reading should be abandoned for today and resumed at a later stage next week, the following week or whenever is appropriate. There is no overwhelming urgency about the Bill. I commend my proposal to the Government and I hope that they will listen to it and accept it.

3.30 p.m.

Earl Russell

My Lords, I cannot help thinking that the point made by the noble Lord, Lord Harmar-Nicholls, about the flexibility of procedure turns back upon him. The ability to introduce amendments at Third Reading has distinguished this House from another place for approximately 350 years at the least. However, like other privileges of this House, that privilege depends for its enjoyment upon continued self-restraint. In the light of our agenda after the Whitsun Recess, I cannot help wondering whether this is precisely the moment for the Government to set an example of breaking that self-restraint. That view may not be universally shared in the Department of Employment but I would imagine that it is widely shared on the Government Front Bench in this House.

Speaking for a moment purely personally, I cannot help expressing regret that at precisely the moment when I am about to set out with the Government on a long route-march they choose to shoot themselves in the foot. I am in full agreement with what has been said by the noble Baroness, Lady Turner, the noble Lord, Lord Rippon of Hexham, the noble Lord, Lord Campbell of Alloway, and the noble Lord, Lord Rochester, on my own Front Bench. I am in particular agreement with the noble Lord, Lord Rochester. I am not yet convinced that there is so much doubt and confusion in the law that it is urgently in need of clarification.

I am more convinced by the remark of Mr. Clarke, counsel for Palmer in Palmer v. Associated British Ports, in one of the cases which the Government propose to reverse. At page 24E of the transcript he stated: It is a simple enough case for a junior. I am sure their Lordships do not need to be troubled". With that opinion I agree.

Viscount Ullswater

My Lords, I am sorry that the noble Baroness, Lady Turner, was indisposed last Thursday and obviously unable to make her comments on the recommitment proposal that I made on that date. I understand that she wishes to have her remarks today on the record. Of course, the noble Baroness is quite right. I gave notice on 6th May at col. 860 of the Official Report of our intention to move the amendment during the Report stage of the Bill. As I said at the time —and I may be repeating myself, as the noble Lord, Lord Rochester, said—the Government's purpose is to clarify the effect of the law in this area. The recent judgments of the Court of Appeal in two cases have confirmed that the law is giving rise to difficulties and confusion. The present position is unsatisfactory and it is important that we should act quickly to make the law clear.

It is clear from the decisions of the Employment Appeal Tribunal and the judgments of the Court of Appeal that the law is giving rise to considerable difficulties. I believe it is right that we should take this opportunity, while the Trade Union Reform and Employment Rights Bill is before Parliament, to clarify the law in that area.

It is not the case that the Government are simply reacting instantly to the Court of Appeal judgment. My noble friend Lord Rippon was not making a comment on the amendment itself but on the speed of introducing the amendment. We have been aware for some time that Section 146 has been causing difficulties for the industrial tribunals and Employment Appeal Tribunals. We have been keeping the matter under close review. However, it is true to say that the Court of Appeal judgments were not in line with what the Government had expected and certainly not with the Government's intention as to the way in which the law should operate in that area. In the circumstances, we believe that it is right to bring forward an amendment now. Obviously when we discuss the amendment I shall be able to quote the words of the noble Lord, Lord Jacques, who introduced the provision and to indicate why we believe that the amendment is a clarification. From what the noble Lord said when he introduced the provision in 1975 it is quite clear that what we are doing today is purely clarifying the law.

Noble Lords

Oh!

Lord Ennals

My Lords, I am most grateful to the noble Viscount for allowing me to intervene. Is he saying that the matter has been of some concern to the department for some time? If that is so, why was not the amendment brought forward earlier?

Is it right to assume that the Government decided to bring the amendment forward when they did not like a decision by the Court?

Viscount Ullswater

My Lords, it is a rather complicated area. The industrial tribunals found one way; the Employment Appeal Tribunal found another, which was in line with Government thinking. However, it gave leave to appeal. It said that there are difficulties in this area of the law. As the law stood, at that moment obviously the law supported the line that the Government took. I believe that the noble Lord would understand that. However, when the Court of Appeal judgment was released only a few days ago it acted in the opposite way. Having been aware of the inconsistencies in the law—and they were pointed out to us—at that moment we sought to make this amendment while the Bill was before Parliament.

Lord Wedderburn of Charlton

My Lords, I am grateful to the noble Viscount for allowing me to intervene. I ask the question in order to speed up our debates if they are to go ahead. He has often said that the Government needed to clarify the judgments of the Court of Appeal. Either now or before substantive debate, will he give us a reference to pages or paragraphs in the Court of Appeal judgment which are unclear so far as concerns principle? Will he also give references to the industrial tribunal decisions and the EAT decisions—for the first time he states that they exist—which have thrown doubt on the law? It is not the mere fact that one court reverses the decision of another; that happens every day. If the Government legislated every time the Court of Appeal did so, we should be debating night and day.

Will the noble Viscount also state that if he goes ahead with the substantive debate he is able, and has the authority, to consider any amendments put to the Government; and that if they are difficult amendments to accept, that he can adjourn the House when necessary in order that proper consideration can be given not by noble Lords on this side of the Chamber but by the Government?

Viscount Ullswater

My Lords, the noble Lord asks me to go into some detail. Perhaps I may quote from an extract of the EAT judgment. It states: Section 23(1) (a)"— that is the section under the 1978 consolidated Act— has caused and may well continue to cause problems. We will give leave to appeal and would welcome guidance. We share the difficulties which this Industrial Tribunal found in the wording of S.23(1) (a)". It continued: For the reasons we have given therefore the appeal is allowed and the Originating Application of each of these complaints must be dismissed. Leave to appeal". I have sought to answer the noble Lord, Lord Wedderburn, on my feet. I should prefer to do so when we speak to the amendment.

However, in answer to the noble Lord, Lord Howie of Troon, I do not believe that it is necessary or desirable to delay the passage of the Bill. We are providing through this Motion an opportunity for the House to consider the amendment in detail on recommitment. It will obviously be discussed in another place. We have tabled the new clause as soon as possible to allow time for any further amendments to be tabled. Amendments have been tabled. The remainder of the Bill has received very thorough consideration by your Lordships. I believe it reasonable in the circumstances for the House to proceed to Third Reading of the Bill on this day.

Lord Howie of Troon

My Lords, the noble Viscount has been very considerate over interventions. Will he comment on my suggestion that the Third Reading should be postponed? As the noble Earl, Lord Russell, pointed out, it has been the custom to put down Motions in this House at Third Reading for a very long time. It may well be that the need for further amendment between Report stage and Third Reading could arise from our debates today. However, as yet there is apparently no opportunity for that. I suggested—I sought to help the Government —that the Third Reading be postponed until another day so that adequate consultation and consideration of further amendments at Third Reading should take place.

Viscount Ullswater

My Lords, of course these matters have been discussed with the usual channels. We do not come to the Dispatch Box to propose something that has not already been discussed and agreed between ourselves and the Opposition. I sought to explain why I felt it was perfectly reasonable to go through to Third Reading. The remainder of the Bill has been discussed in some detail.

I recognise that if we were to deal with the amendment proposed on Third Reading it would restrict the scope for debate. I agree that it is important for your Lordships to have the opportunity to debate the amendment thoroughly. I also agree with my noble friend Lord Harmar-Nicholls that we want to get on with the debate in order to have a proper discussion. That is why the Government tabled the Motion providing for the Recommitment of this part of the Bill. I commend the Motion.

Lord McCarthy

My Lords, before the noble Viscount sits down, he was kind enough to say that he intends to quote from the speech which the noble Lord, Lord Jacques, made in 1976. So that we may take care and follow precisely what he says, will the noble Viscount now cite the reference so that we may look it up?

Lord Hailsham of Saint Marylebone

My Lords, perhaps I may make a humble suggestion. We are where we are now. There is obviously criticism of the Government. The noble Baroness, Lady Turner, and others have made that plain and stated their objection. However, every prolongation of this part of the debate will be at the expense of the substantive discussion and will make matters worse. Should we not get on with it?

Lord Jenkins of Putney

My Lords, is not that suggestion in itself rather damaging to what we are trying to discuss? If one gets on with it, one accepts it. What people like myself, who come to the matter afresh, want to know is: why are we in this situation? The usual channels who acquiesced in this obviously have doubts as to whether what they did was right. They were not happy about it, otherwise there would have been no debate. They tell us that they agreed to go along with this arrangement in order to facilitate the Government. Those who come to the matter afresh are faced with a situation which we had no reason to expect. This is an unusual procedure and if we accept the proposition of the noble and learned Lord, Lord Hailsham, we shall be accepting that we go ahead with a discussion which those of us who come to the matter afresh feel ought not to take place in the way proposed on the Order Paper. For that reason, I take the view which has been most widely expressed; that some arrangement should be made so that the matter can be examined in greater detail than is presently proposed.

Viscount Ullswater

My Lords, I look forward to seeing the noble Lord, Lord Jenkins, taking part in our debate this afternoon. He has not done so to date, but I look forward to his contribution.

In order to help the noble Lord, Lord McCarthy, I shall cite the reference for the quotation for which he asked. It is from Hansard, 23rd September 1975, col. 189 and subsequent columns.

On Question, Motion agreed to.

House in Committee (on Recommitment) accordingly.

[The CHAIRMAN OF COMMITTEES in the Chair.]

Viscount Ullswater moved Amendment No. 1:

Before Clause 13, insert the following new clause:

Action short of dismissal: non-infringing actions (". In section 148 of the 1992 Act (consideration of complaint of action short of dismissal), after subsection (2) there shall be inserted— (3) In determining what was the purpose for which action was taken by the employer against the complainant in a case where—

1. (a) there is evidence that the employer's purpose was to further a change in his relationship with all or any class of his employees, and
2. (b) there is also evidence that his purpose was one falling within section 146,

the tribunal shall regard the purpose mentioned in paragraph (a) (and not the purpose mentioned in paragraph (b)) as the purpose for which the employer took the action, unless it considers that the action was such as no reasonable employer would take having regard to the purpose mentioned in paragraph (a). (4) Where the action which the tribunal determines to have been the action taken against the complainant was action taken in consequence of previous action by the employer paragraph (a) of subsection (3) is satisfied if the purpose mentioned in that paragraph was the purpose of the previous action. (5) In subsection (3) "class", in relation to an employer and his employees, means those employed at a particular place of work, those employees of a particular grade, category or description or those of a particular grade, category or description employed at a particular place of work.".").

The noble Viscount said: In moving the amendment that stands in my name I am aware that it has already been the subject of a certain amount of controversy. I have to say that a little of it even surfaced today. I am pleased, therefore, that we have been able to resolve into Committee once again this afternoon so that the issues may be debated fully, without the constraints that would apply at Third Reading.

I believe that it will be helpful to our deliberations this afternoon if I set out the background to the tabling of this amendment and, in particular, details of the recent Court of Appeal cases that have pointed to the need for clarification of the law.

The law on action short of dismissal has, since we consolidated industrial relations law last year, been contained in Section 146 of the Trade Union and Labour Relations (Consolidation) Act 1992. In broad terms, it provides protection for the individual against action taken against him by his employer for the purpose of deterring or compelling trade union membership. It offers protection for the individual trade union member (or non-trade union member) against victimisation at work by his employer.

The recent Court of Appeal cases which have persuaded the Government that the amendment before us today is necessary arose before the law in this area was consolidated and when it was contained in Section 23 of the Employment Protection (Consolidation) Act 1978. The law itself was exactly as it is today.

In these related cases, two separate employers, Associated Newspapers and Associated British Ports, decided that they wanted to alter the way in which they negotiated with their workforce. Instead of maintaining collective bargaining arrangements they wanted to de-recognise the union in question and move to a system of personal contracts. It is, of course, the employer's right to decide exactly how he wants to negotiate with his staff. After all, no one but the employer in question can know all the relevant circumstances and can decide what is best for his business. It has always been this Government's policy to ensure that employers have the freedom to act in this way.

In these cases, in order to persuade their employees to accept new personal contracts of employment, the employers offered them a financial inducement to sign. In effect, those who signed the new contract received a pay rise, and those who refused did not. The employers believed, as did many of those who have followed these cases, that there was nothing unlawful in their actions. They made a business decision about their future method of negotiation with staff and took appropriate action to implement it. They have maintained throughout that they had no interest in whether or not their employees were members of the formerly recognised union or any other union. They have certainly not sought to prevent their employees continuing to be members of a union—which would indeed have been unlawful. Their interest and their action related to the conduct of their own relationship with their employees.

Nonetheless, cases were brought under what is now Section 146. In each case, the industrial tribunal found that the employer had contravened Section 146, but that finding was reversed by the Employment Appeal Tribunal. The EAT's rulings were, I have to say and have said, in line with what the Government had expected, and applied the law in the way in which we had understood it would operate. However, only a few weeks ago, the Court of Appeal found that the employer had acted unlawfully in both cases.

These cases have proved difficult to resolve, and this area of law is now in a state of confusion because, it seems, of the way that Section 146 is formulated. The section protects against action taken against the individual for the purpose of compelling or deterring trade union membership. Our understanding is, and always has been, that this means that in broad terms an employer is prevented from victimising individual trade union members or non-trade union members. The provisions were not intended to apply in a situation where an employer takes a particular action in order to achieve an organisational or strategic purpose, and where that action may incidentally have negative side effects for certain people who are, or are not, trade union members.

Thus, it seems to us that Section 146 should not have applied in the Associated Newspapers and Associated British Ports cases. The fact that it has successfully been argued that it does indicates that the law is unclear and that it is not achieving the purpose for which it was intended. We have therefore brought forward this amendment.

It may be helpful to your Lordships if I set out in a little more detail exactly how Section 146 was originally intended to operate. The law in its current form was first introduced by the Labour Government in 1975. To illustrate the intentions that lay behind that legislation I can do no better than to quote the noble Lord, Lord Jacques, who took the relevant legislation through your Lordships' House. In doing so he emphasised that the clause: deals with individual rights of employees, not collective bargaining issues."—[Official Report, 23/9/75; col. 189.]

He went on to explain: a prohibited action must be for the purpose of prevention, deterrence or penalisation. Actions aimed at other purposes, such as helping recognised unions, which have the incidental effect of restricting some employee's rights comparatively, do not infringe these rights."—[col. 192.]

When the law on action short of dismissal was amended in 1982 these intentions were unchanged. My noble friend Lord Ferrers explained the position to your Lordships' House in these words: Clearly, it would be unfair if an employee were, for instance, to have taken away from him his company car because he was not a member of a trade union … but it would not be unfair to have a differentiation between rates of pay …" —[Official Report, 28/7/82; col. 331.]

As noble Lords will see, from its earliest days, and under different governments, the intention behind the section has been to protect against individual acts of discrimination, and not to confuse those with collective bargaining issues.

I hope that the Committee will forgive that lengthy preamble to my description of what the amendment actually does, but I thought that it would assist our deliberations this afternoon to have this information about the context in which I am bringing forward this amendment.

The amendment clarifies for the benefit of tribunals and courts the way in which an employer's purpose should be determined in cases such as those which have occurred most recently. It provides for the situation where a case comes to a tribunal and the employer and the individual put different arguments about the employer's purpose in taking a particular action. Where it is argued, on the one hand, that the employer's purpose was to bring about a change in how he conducts his relationship with his employees (that is to say, his bargaining arrangements) and, on the other hand, that his purpose was a purpose falling within Section 146, then the tribunal is to take the bargaining purpose as the relevant purpose. However, the tribunal must always have regard to the reasonableness of the action taken. If the action is, such as no reasonable employer would take

in the circumstances, then the tribunal will still be able to decide that the action amounts to action short of dismissal in the terms of Section 146.

The effect of the amendment will be to restore the proper distinction in Section 146 between individual and collective matters. Section 146 will continue to give individuals important protection against victimisation because of their trade union membership or non-membership, but it will not prevent employers from making and implementing legitimate decisions about how they wish to negotiate with their employees.

We should not exaggerate the effect of this amendment, which does no more than clarify this particular area of the law. It will apply only in a particular set of circumstances, such as those that arose in connection with the recent cases which I have described. Only where an employer wishes to bring about a change in the way he conducts his relationship with his employees and in order to do so takes action which is argued to be action in contravention of Section 146 will the amendment come into play; and only then if the action is reasonable in the circumstances. It is an important amendment, but it does not amount to a fundamental change in the law. Indeed, as I have argued, the Government believe that it does no more than ensure that the law is applied in the way that had always been intended.

There is a further important point that I should like to make clear about the effect of this amendment. It arises from a question which the noble Lord, Lord Rochester, raised during the brief debate on the Government's Recommitment Motion last Thursday. The noble Lord said (reported in Hansard on 20th May, cols. 1857–58) that his understanding was that the new clause would not affect either of the two cases covered by the Court of Appeal's recent judgments, nor indeed any others which may be awaiting hearing by an industrial tribunal. He asked me to confirm that that was the case.

I thought it right to deal with this matter in introducing the new clause. I can indeed confirm that the noble Lord's understanding is entirely correct. The amendment would not take effect until after the Act receives Royal Assent and this particular provision has been commenced. That means that any existing cases currently before the courts or the tribunals—and, indeed, any cases which concern action taken before the new clause comes into effect—would fall to be decided under the law as it currently stands. As I have made clear, the Government believe that the amendment will simply ensure that the law operates as had always been intended. Nevertheless, it would clearly be wrong to attempt to make the amendment apply retrospectively, and I am happy to give the House reassurance on that point.

Moreover, it should not go unremarked that the amendment will not apply solely in situations where an employer's purpose is to de-recognise a trade union—such a narrow amendment could hardly, after all, be described as clarifying the law. The amendment provides that in any situation where an employer wants to change his negotiating arrangements and takes reasonable action to bring about that change he will not be acting in contravention of Section 146.

Before concluding, I should like to take up a point about which I know that the noble Lord, Lord Blease, is concerned. I understand that he is unable to be present today, but for clarification I confirm to the House that the provisions contained in this new clause will not he among the provisions extended to Northern Ireland by Clause 53.

In conclusion, a government's duty is to bring forward legislation to implement the policies on which they were elected, and to keep a watchful eye to ensure that legislation continues to achieve the purpose for which it was made. Recent events have made it clear that Section 146 has ceased in certain cases to achieve its intended purpose. The purpose of the amendment before the Committee is to put that right. I beg to move.

Baroness Turner of Camden moved, as an amendment to Amendment No. 1, Amendment No. 2:

Line 6, leave out ("further a") and insert ("negotiate an agreed").

The noble Baroness said: The object of this amendment is to insert into the new clause the requirement that the employer should negotiate and agree with his employees any change in his relationship with all or any class of them. If unamended in that way, or in one of the ways later to be suggested by my noble friends, the new clause would have the effect, in my view, of totally undermining the protection afforded to employees by Section 146 of the 1992 Act. As we have seen, Section 146(1) (a) states that, An employee has the right not to have action short of dismissal taken against him as an individual by his employer for the purpose of— (a) preventing or deterring him"— and I emphasise that point— from being or seeking to become a member of an independent trade union, or penalising him for doing so". Of course it is about individuals. We have never argued that it was about collective rights.

This is not a new provision, as I said earlier. It appears in the Act of 1978 in exactly the same wording, and, as the Minister himself has agreed, in the Employment Protection Act of 1975. I again say to the Minister that if the Government thought there was a need for so-called clarification, there has been ample opportunity for doing so, certainly before this afternoon on the final stages of a major Bill. Furthermore, the decision to take this course was apparently taken following the Court of Appeal judgment on 30th April and, as we all know, before the full transcript was available.

As we have seen, the cases before the Court of Appeal—Wilson v. Associated Newspapers and Associated British Ports v. Palmer—concern the denial of pay increases to employees who refused to sign personal contracts which required them to relinquish trade union representation. In both cases the industrial tribunal decided that offering financial inducements in that way constituted action short of dismissal on grounds related to union membership activities. The EAT, as the Minister has explained, overturned those verdicts, again by a majority decision—a member of the EAT dissented. The Court of Appeal ruled that the employer's actions amounted to unlawful discrimination under Section 146 of the 1992 Act. As I said earlier, in my view the maverick decision is that of the EAT. The Court of Appeal seems to have followed precedent set in other cases. The Court of Appeal judgment refers specifically to the cases of the National Coal Board v. Ridgway and Discount Tobacco and Confectionery Ltd. v. Armitage. Here we have the Government seeking an amendment which would appear to support the EAT as against the Court of Appeal and previous precedents. It does not seem to me to be a case for clarification. If one is talking about clarification, just look at the wording of this amendment! Perhaps I may read subsection (4) of the proposed new clause: Where the action which the tribunal determines to have been the action taken against the complainant was action taken in consequence of previous action by the employer paragraph (a) of subsection (3) is satisfied if the purpose mentioned in that paragraph was the purpose of the previous action". If that is clarification, I really am very surprised. I wait to hear the Minister explain to us precisely what that means.

In his judgment Lord Justice Dillon states that he had no doubt that the purpose of Associated British Ports in offering extra pay to those employees who signed the new personal contracts was to persuade employees to abandon union representation by making personal contracts so attractive that, as it was put by the dissenting member of the EAT, the union would wither on the vine". It was claimed that although some employees had accepted the offer of a personal contract, they could have remained members of the union.

However, Lord Justice Dillon referred to the case of Discount Tobacco and Confectionery Ltd. v. Mrs. Armitage. In that case, the employee was dismissed by her employers after she had consulted a union official about the terms of her contract of employment and the union official had written a letter to her employers on her behalf about the terms of the contract. The industrial tribunal held that she had been dismissed because of her union membership. The employer's appeal to the EAT said that there was a distinction to be drawn between membership of a union on the one hand and resorting to the services of the union on the other. That argument was dismissed.

There is no need for that kind of clarification. The Court of Appeal judgment seems very clear. If the clause now suggested by the Government is incorporated into the Bill, it is likely to lead to much more confusion. Employers will imagine that the type of actions embarked upon by Associated Newspapers and Associated British Ports are now legitimate, and that it is open to them to end collective bargaining and offer bribes in the shape of higher salaries to individuals who will opt for personal contracts and will agree to forgo union representation. It will not be very long before that is being widely interpreted as legitimising pressure for people to leave the union altogether.

If our amendment were accepted, it would at least bind the employer to negotiate any changes in his structural relationships and to agree them with the employees so affected instead of simply imposing them. That would be some small amelioration in a totally unsatisfactory and indeed totally objectionable clause. I beg to move.

4 p.m.

Lord Rochester

Earlier this afternoon the noble Viscount, Lord Ullswater, said that the Government had had this matter under consideration for some time and that they were surprised by the Court of Appeal judgment overturning the judgments of the Employment Appeal Tribunal which they had thought represented the existing law. But the Court of Appeal judgments were consistent with earlier industrial tribunal findings. I believe the point has already been made this afternoon that it seems odd, to say the least, that it has taken 15 years (since the passing of the 1978 Employment Protection (Consolidation) Act on which the present law depends) for the Government to find that there is need for this amending legislation.

In debates in Committee and on Report, my noble friends and I felt that the effect of the Bill in a number of ways was to undermine what might be called the raison d'Être, of trade unionism; namely, the right of people to combine together and ultimately, if the need arises, to withdraw their labour.

In our view, good industrial relations depend on there being a reasonable balance between management and employee representatives. But if instead of legislation being even-handed in its application, the process is weighted at every turn—as it has been in this Bill—in favour of the employer, not only individual freedom but ultimately this country's economic performance will suffer.

Accordingly, the question we have to ask is: what is the Government's real aim in introducing such an amendment into the Bill? I am sorry to have to say it, but feel that I must: is it so to weaken trade unions that they will eventually be driven out of existence? In our view, trade unions are an essential part of a free society—look at the countries in which they no longer exist—and a free society dismantles them at its peril.

We are told in this amendment that where there is a conflict between the employer's purpose no longer to recognise a trade union—a purpose which he is already at liberty to pursue—and the right of an employee not to have action short of dismissal taken against him by his employer to deter him from being the union member, it is the purpose no longer to recognise the union which is to prevail. It is true that subsection (3) (b) states that the action of the employer must not be: such as no reasonable employer would take having regard to the purpose"— which is, not to recognise the union.

There are several comments to be made on that. First, once more it will fall to lawyers to argue among themselves, this time as to what is meant by the term "reasonable employer". I hope that tribunals will conclude that an employer who, as in the recent Court of Appeal cases, grants significant pay rises to employees who accept personal contracts but not to those who choose to remain union members is not a reasonable employer. But I fear that in moving the amendment the Government consider that if the new legislation had applied in those two cases (the Minister has practically said so), the actions of the employers concerned would have been held to be within the law. Otherwise, I do not see why the Government would want to amend the law as they are doing.

In other and cruder words, it seems that under this Government we have now reached the position that in future there will be nothing to stop employers who are so inclined from offering sweeteners—or bribes; let us not mince words—to employees to induce them to leave their union. I find that offensive. I hope that the Committee will, too. I am glad on that basis to support the amendment moved by the noble Baroness, Lady Turner, which at least goes a little way to mitigating the effects of the government amendment.

Lord Campbell of Alloway

The question with which the Committee is concerned on both the amendments can be put quite simply. I want to make a simple speech because this is a very complex subject. It might be helpful to leave the legal technicalities to the noble Lords, Lord Wedderburn and Lord McCarthy, and the noble Baroness, Lady Turner, from whom we have already heard some of them put extremely well. It will be found in five lines on page 22 of the judgment: this decision does not dispute an employer's right to de-recognise a union and make changes in consequence in the terms and conditions of the employee's employment. The employer only enters a potential danger area if he offers a douceur"— the bribe, as it was called by the noble Lord, Lord Rochester— to employees who will support his policy, which is to be withheld from those who are not prepared to support it". In five lines, that is the question.

Leaving aside the complex reasoning of the judgment, which I have not been able to assimilate, and the technical legal questions of statutory interpretation as to action short of dismissal, the cases on it and unlawful discrimination, the question is simply whether an employer has a right to derecognise a union. That is not in dispute; it is whether, in implementation of that policy, the employer may offer increased wages to those who accept and withhold from those who refuse. To be quite frank, I cannot see the difference, which my noble friend Lord Ferrers sees, between a car and wages. But there it is. Reading the judgment, perhaps this all but incomprehensible maze of statutory provision is overripe for total reclarification not only concerning this question.

The proposed amendment has to be seen in fair perspective. As I read it, subject to correction, it would not preclude the courts from reaching precisely the same decision as that reached by the Court of Appeal if, as the Court of Appeal held (but not in terms), no reasonable employer—having regard to the purpose mentioned in paragraph (a) and the tailpiece to paragraphs (a) and (b)—would have taken such action. It is little different from the reasoning of the Court of Appeal.

The Committee may feel that the proposed amendment provides an alternative avenue by which the decision of the Court of Appeal could be upheld in similar circumstances. I agree with the Minister that in that sense the clause makes no fundamental change. It follows that to some degree it serves as an aid to the clarification of this complex statutory provision, in the light of contradictory decisions which have taken three years to reach the Court of Appeal and, for all one knows, may be on their way to the Appellate Committee of your Lordships' House.

We have to look at the fundamental principle behind the amendment. Both the proposed amendment and the Government's attitude are a reflection of fundamental government policy —affirmed by the Minister today at the Dispatch Box—that employers should be free to decide whether to accord recognition to a trade union, and that the setting up of recognition machinery is wholly unacceptable. If such is the policy, then, if an employer is free to recognise; or not to recognise; to implement a "no-strike" clause; or to conclude a single union agreement; surely he must also be free to seek to induce the non-union representation as proposed by the amendment subject to some proposed safeguard.

In regard to the safeguard proposed, this is not the first time that the noble Lord, Lord Rochester, and I, without any form of consultation, have held the same type of reservations. It is apparently an objective standard for the decision of the tribunal and the courts on the evidence adduced. It may not be entirely satisfactory. What is the action which no reasonable employer would take? Is it rather like the elephant which one recognises when one sees it, but which belies any easy definition?

While the fundamental policy of government remains in place, I simply do not understand what useful purpose can be served by opposing the amendment. On many occasions, I have sought in vain to persuade the Government to change their policy. The Government have set their face against any form of statutory framework for recognition machinery. It must be fairly conceded that neither I, the noble Baroness, Lady Turner of Camden, the TUC nor anyone else so far as I am aware, have been able to devise any satisfactory framework. It is not a simple problem. None of us, in our cross-party discussions which we have at times, indicated that we wanted to go back to the relevant provisions of the Act of 1971 which were lifted piecemeal from the Barbara Castle industrial relations Bill.

Nonetheless, before too long the day must come—and it surely will—when recognition procedures, worker participation, inducements to avoid trade union representation with which we are concerned today and other aspects of our domestic law of industrial relations, with or without the Maastricht opt-out clause (which I have not been able to study sufficiently for this purpose), will receive consideration from the Court of Justice and the European Court of Human Rights. I wholly support the Government in the view that our domestic law requires clarification in this context. It is of course subject to supranational law, according to the jurisdiction that we have conferred on those courts.

The sovereignty of Parliament to introduce amending legislation of this order is not in question. But the implementation of that legislation can be called into question. If the Government are dissatisfied with the decision of the judiciary, they retain the sovereign right to strike down the decision by amending the legislation. Perhaps the most notable example in that sphere was the Taff Vale case.

As members of the European Community, our sovereignty to implement domestic legislation is now qualified. I am grateful to the Minister for making it patently clear that the legislation cannot affect any position that arose prior to Royal Assent. In conclusion—at all events, until Maastricht has cleared our parliamentary hurdle, as affording a step in an ongoing process of negotiation and while the fundamental policy of government as regards recognition remains as it is, in place—it would be pointless and perhaps even premature to oppose the Government on Amendment No. 1.

Lord Wedderburn of Charlton

I follow the noble Lord, Lord Campbell of Alloway, partly because he was the first to recite in full to your Lordships a passage from the judgment, and to do so with great effect. Amendment No. 2 points to a crucial area of the Government's amendment which poses the question whether an employer under the Government's regime would be able to force through, without any negotiation with anyone, changes in the employment relationship and so wipe out whatever was the area of his intent or purpose to indulge in trade union cleansing.

Faced with that, the Government retreat with what they call "uncertainty". All that they have shown is that they like the decision of the Employment Appeal Tribunal but not that of the Court of Appeal. Governments and others frequently find themselves in that position. I fully share the view of the noble Lord, Lord Campbell of Alloway, that the Government should have the right to legislate in face of that. But they should have read the judgment properly before doing so. With great respect, even our debates so far show that the Government have not done so. They should have stopped the amendment in its tracks, gone away and thought again.

I refer especially to page 22 of the judgment, which the noble Lord, Lord Campbell of Alloway, cited, both in respect of the Court of Appeal's insistence that its decision and the decisions of industrial tribunals in the future in this area would rest upon the balance of the evidence—not as under the Government's amendment, where one piece of evidence can wipe out another piece of evidence, but on the evidence as a whole. That is the first of three points on the judgment. Secondly, Lord Justice Dillon—I cite this again in quotes in order that the Minister should take account of it and reconsider his briefs on the question—said that, this decision does not dispute an employer's right to de-recognise a union"— I interpolate "collective rights"— and make changes in consequence in the terms and conditions of the employee's employment. The employer only enters a potential danger area if he offers a douceur to employees who will support his policy, which is to be withheld from those who are not prepared to support it". The Court of Appeal there is in direct accord with the only piece of evidence that the Government have cited so far concerning the intent and clarity of this section. Section 146 goes back to 1975 in precisely the same terms and, as the noble Lord, Lord Campbell, rightly said it goes back really to 1971. Although Section 5 of the Industrial Relations Act 1971 was rather different in some respects, nevertheless the broad thrust of it—that the employer should not deter or penalise an employee from becoming a member of a trade union—was the same. Indeed, this is an area which up to now, since 1971, give or take the terms precisely, has been, oddly enough, an area of bipartisanship. No one has thought fit to knock out the right to be a trade union member or to so pose it against the employer's rights that the employer can knock it out when he likes. That, of course, is the reality of the Government's amendment. And if the Government refuse and reject my noble friend's amendment, the employer will not be required to negotiate with anyone, not even individually.

But the noble Lord, Lord Jacques, in 1975, in introducing the Labour Government's clause, drew a distinction between rights, as the Minister said, which the worker holds as an individual and collective rights concerning recognition or collective bargaining. If one goes to the bottom paragraph of page 22 of the judgment one finds that distinction set out yet again as an obvious statement of law. There is no uncertainty. I have consulted a large number of brethren and, I hasten to add, sisters in the practising profession over the past few days since we had sight of the Government's amendment. They are not all in agreement with me on policy but I did not find one who rejected the concept that this is a new departure. The noble Lord, Lord Jacques, will not work for the Government because he stated something with which we all agree, as does the Court of Appeal. Can the noble Viscount cite a book? Can he cite an article or a commentary—or even a footnote—which suggests that this section should be interpreted in a way other than that in which the Court of Appeal interpreted it?

It was the Employment Appeal Tribunal which was the novelty. Mr. Justice Wood, rather carefully on the facts, did two things; first, he said that he decided this on the special facts of the case; but secondly, he said, at a vital point of the judgment concerned with the law in the Employment Appeal Tribunal, that it would be nice to have the guidance of a higher court on the matter, which is a sign of uncertainty. If one goes to the Court of Appeal judgments, with the orthodox long-standing interpretation, there is no uncertainty there. Of course, I do not guarantee that the Judicial Committee of this House will not form either view or even a third view. I cannot insure your Lordships against that. But there is no literature suggesting that there is any uncertainty; or if there is, will the Minister please cite it?

What there is is a government decisicn—on the evidence it seems to be a pretty recent government decision; on the evidence perhaps not through the processes of the Department of Employment. One does the Department of Employment the compliment of thinking that it would have longer consideration of matters within its direct purview. On the evidence it seems possible—though this is speculation—that someone in a huff, having lost in court, got in touch with someone higher up, and someone higher up said, "This has got to go". So of course when the noble Viscount came to announce the decision he did not cite—with great respect to him, he does not cite now —the Court of Appeal judgment properly.

The other issue involved is precisely the individual right issue. The international standard—we shall be coming to international standards in some of our later amendments—is quite clear. It is laid down by the International Labour Organisation conventions, by the Council of Europe social charter and by the United Nations international covenants. It has been clear since 1948 with the ILO freedom of association convention, with the 1949 right to organise and collective bargaining convention and also with the European Convention on Human Rights, as that is an instrument on which it appears the Government place greater weight, although they have ratified and still accept theoretically all the rest.

What do these instruments say—that there should be freedom of association not in an abstract sense; not in a sense of simply having the right to hold a party card and going to work and then being penalised. Anyone concerned with international comparative labour law would laugh at any such idea. The extent of the protection is a matter for application. It was in decisions such as National Coal Board v. Ridgway in 1987 in the Court of Appeal that the Court of Appeal insisted that this was a protection only for individuals. In the case of Discount Tobacco and Confectionery Ltd. v. Armitage in 1990, Mr. Justice Knox held that it went a little further than the right to have a union card. A union card yes, but what should happen when a worker required a local official to help him or her—it was "her" in that case? Yes, said Mr. Justice Knox, having the local official to help is part of being a member.

The Minister seemed to cite the case of Discount Tobacco and Confectionery Ltd. v. Armitage as though it was to do with collective bargaining. It has nothing to do with collective bargaining. It is to do with grievances. The noble Viscount says that he did not. I apologise to him. I am sure in that case that he did not. It was someone else, Someone else cited it in that way. The Minister agrees with me that they were wrong. What was being discussed was the individual right to have the help of a local official in certain circumstances on an individual matter. It is by no means certain. Mr. Justice Knox held that that right was the outward and visible manifestation of union membership and formed part of the right not to be penalised by the employer for doing it.

In those circumstances, if the Government are really going to come forward with this novel piece of law, they must understand that they are undercutting every other norm, not merely of our past law but also of international comparative labour law as well. Not every country abides by its obligations. One can go to the ILO Committee of Experts' reports and find examples. This country has been one of the examples in other areas. It grieves me and makes me sad to see this country being rushed at six days' notice—72 hours' working notice—into a new law which will form another passage in the Committee of Experts of the ILO. If the Government want this, could they not show that they have some understanding of the power relationship on the office floor and the factory floor by accepting that before the employer is put into this driving seat he must at least put forward a little evidence of negotiating with the people who are now to be in his power?

Lord Moyne

My worry about the Government's proposal does not refer to the comparison with international norms so much as the comparison with their own policy. In the Government's legislation over the past 10 years or more it has been established—and quite rightly established—that it is the individual's right not to belong to a trade union. Surely that implies that it is also an individual's right to belong to a trade union

Earl Russell

I should like to thank the noble Viscount for the care he has taken to make the Court of Appeal transcript available to us and for his care to make the text of the amendment available to us before the weekend. In all the dissatisfaction I have expressed about the procedure I have not for a minute criticised or intended to criticise the courtesy with which the noble Viscount personally has conducted it. Nevertheless, the point remains that at short notice I must speak more speculatively about the meaning of this amendment than I would otherwise have wished. The point has been made many times by the noble Lords, Lord Renton and Lord Rippon of Hexham, and the noble and learned Lord, Lord Simon of Glaisdale, that rushed and hasty legislation does not always achieve its desired effect. The noble Viscount told us that this amendment did not achieve a fundamental change in the law. Before listening with great interest to the noble Lord, Lord Campbell of Alloway, I felt that perhaps the noble Viscount was speaking rather truer than he knew. Purpose tests in court often cause difficulty. Some of us may remember the cases that used to arise under Section 2 of the Official Secrets Act 1911 involving a purpose prejudicial to the safety of the state. It was sometimes very difficult to decide whether or not a purpose was prejudicial to the safety of the state.

The amendment before us asks us to distinguish between two purposes. In theory and in principle it is perfectly possible for such a distinction to be made and to stand up. The question that causes me doubt is whether, on the facts of an individual case, the court will see two separable and distinguishable purposes or whether they will see one single purpose. I have attempted to apply that test to the transcripts of the Palmer and Wilson judgments which the noble Viscount told us on Report this amendment was intended to reverse. I am not a lawyer and have not had time to take expert advice. I speak with hesitation. Looking at this amendment, we are asked to distinguish between a purpose by the employer to further a change in his relationship with his employees from a purpose falling within Section 146, which is to penalise or deter membership of a trade union.

The noble Viscount explained this a little further, referring to an organisational or strategic purpose. When I look at the transcripts of the Palmer and Wilson cases the only organisational or strategic purpose that I can see is the purpose of deterring employees from belonging to a trade union and penalising them if they do so. Speaking purely as a layman, if I was asked on the facts of those cases to make the distinction which this amendment asks us to make I simply could not do it. It is perfectly possible that anyone who followed that line of reasoning might reach exactly the same judgment after this amendment as they would have made before it.

The idea of a double purpose reminds me of the 18th century story of the father and son: Father, "Listen to me, my boy. When you see the two lights at the end of the hall turn into four lights you know you have had a bit too much to drink". Son, "I can see only one light". Like the son, I can see only one purpose. Why have the Government chosen to legislate in this rather weasel way? It appears to me to be as plain as a pikestaff that the underlying intention is to repeal Section 146 of the 1992 Act, but no such intention is avowed. Whether right or wrong, that at least would have been intelligible. But here we are given an attempt to distinguish between two purposes which are likely to be conflated.

Why the weasel way? One thought that occurs to me is that possibly the more robust intention may be in conflict with one of our international obligations. At home late on a Sunday night I was in no position to check the scope of our international obligations. Mention has been made of the ILO Convention. The noble Baroness, Lady Turner, referred in one of her amendments to the European Convention on Human Rights. Reference has also been made to the Council of Europe Social Charter of 1961. The one that I read, late at night, was Article 118 of the Treaty of Rome. That guarantees the right of association and collective bargaining between employers and workers. Article 118B, inserted by the Single European Act, tells the Commission that it shall develop a dialogue between management and labour. It is possible that the repeal of Section 146 may infringe either of those. My question is: does it necessarily follow that the weasel way of proceeding adopted in this amendment does not infringe either of those provisions? Has the noble Viscount taken legal advice on whether the amendment infringes those provisions? If not, will he withdraw his amendment until he has done so?

That brings me to the important question asked by the noble Lord, Lord Campbell of Alloway: what is the useful purpose in opposing the amendment if it does not change anything? The reason is that the amendment does not do what the Government believe it does. Therefore, the result of having it on the statute book will be many more judgments unexpected by the Government, a considerable number of cases going to the Appellate Committee of your Lordships' House at considerable expense, and further cases of rushed amendments, imperfectly drafted, coming forward on Third Readings leading to even further consideration in this House.

The noble Lords, Lord Renton and Lord Rippon of Hexham, have both argued that while brevity and clarity in the drafting of legislation are important, certainty is paramount. In this amendment I see no certainty, and I invite the noble Viscount to withdraw it.

Lord Howie of Troon

I believe that the Government amendment has been rushed through merely because this Bill happens to be before us at this time. Had the decision of the Court of Appeal not been three weeks ago but three weeks hence the Bill would have been passed and the Government would have had to consider their position more carefully. They would have had to go through the normal procedures of consultation, bringing in whatever amending legislation they thought necessary at a later date. I still believe that that would have been a much more sensible thing in any case. The Government are not clarifying the law but attempting to change it because they did not like the decision of the court. That is perfectly understandable, but we wish the Government to come clean and say what their true motives are.

The Committee will recall that Section 146 of the Trade Union and Labour Relations (Consolidation) Act 1992 made discrimination on the ground of union membership illegal. The result of the Wilson case indicates that so far the right not to be discriminated against is a right not to be discriminated against for making use of union services; that is, collective bargaining. Wilson refused a personal contract and wished to retain his right to collective bargaining. The NUJ in his case remained recognised but had no collective bargaining role. Wilson's pay was not increased, unlike that of his colleagues who accepted personal contracts. Thus, he suffered loss by refusing to give up his right to collective bargaining; in other words, Wilson was discriminated against, and the court rightly held that to be illegal.

The Wilson case is not an isolated example. There have been many other cases where financial inducement or a douceur, as the noble Lord, Lord Campbell of Alloway, called it, has been offered in order to tempt employees to move to personal contracts and to remove collective bargaining. In 1989 about 3,500 middle managers in British Telecom were offered company cars and one-off payments of between £1,000 and £1,500 to persuade them to take up personal contracts. The Society of Telecom Executives offered to conduct a secret ballot jointly with BT to see what the majority actually wished. BT refused. The union carried out a ballot of its own, and 89 per cent. of the employees were in favour of retaining collective bargaining. Unfortunately, in the course of time, a majority of those yielded to the inducements offered by BT. However, about 200 refused the contract on a point of principle.

Subsequently, those people were threatened with a pay freeze unless they took up personal contracts. What is that but discrimination or intimidation? I can hardly believe that that is what the Government intend in this legislation. The union took the case to the industrial tribunal and established that it could represent personal contractors on an individual basis but not collectively. The majority of the tribunal took the decision that the main purpose of the move to personal contracts was to improve the quality of management", which was fair enough, and that the deterrent for those members was merely a necessary side effect to achieve BT's main purpose—that is, to offer some of the employees a pay freeze and others a pay rise. That was merely a necessary side effect. It is extraordinary.

At the time the union's lawyer reflected on the case in these words: No rational employer expends effort in ridding itself of the influence of a union for its own sake. It is precisely because he cannot achieve his main purpose of procuring a compliant work force who can be paid as little or as much as he wishes without weakening the union and reducing its membership. It is in order to protect the rights of employees to be members of an effective union, thereby reducing the imbalance of the employees' bargaining position with the employer, that Sections 23 (and Section 28) of the EPCA 1978 exists". The Government's amendment as it stands could remove most of the present protection against discrimination on grounds of union membership. The right not to suffer discrimination on those grounds, or on the grounds of the use of union facilities, are fundamental rights enshrined in ILO principles to which the United Kingdom is a signatory, as many noble Lords have pointed out.

Personal contracts are designed to remove rights to collective bargaining. It is a roundabout way of de-recognising the union in all but name. I believe the amendment to be vindictive. We are acquainted with the Government shifting the goal posts from time to time. On this occasion they have shifted the goal posts, removed the pitch, dismantled the grandstands and taken the ball home as well. The Government should seriously think again in a more mature way rather than react quickly and improperly to a court decision which they do not like.

4.45 p.m.

Lord McCarthy

The Minister was kind enough to give the Committee a reference as regards the quotation from the noble Lord, Lord Jacques. I have read it. What comes through is that the noble Lord was replying to the noble Earl, Lord Gowrie, who was moving an amendment. Such was the situation of the Conservative Party in those days. The amendment was seeking to limit the scope of the clause to recognised unions. It appears that the Opposition at the time took the point that if the rights were given to unrecognised workers, collective bargaining might be undermined. That was the view with which the Opposition were concerned.

It is important to take on board what was happening at that point. The noble Lord, Lord Jacques, was saying that that part of the Bill was not just about recognised unions and situations and collective bargaining; it was about individual rights and the prevention of penalties. As many other speakers have said, that is precisely what was said in the judgment. Mr. Wilson was penalised by not getting a 4.5 per cent. increase. As an individual he was penalised, and that is what is wrong.

Lord Murray of Epping Forest

The Minister has been very helpful to the Committee in tracing the lineage of this particular proposal—questionable though that lineage may be—and seeking in part to put it into an historical context. The real context of this proposal is a Bill which purports to strengthen the rights of individual employees. It is a Bill which purports to give to the individual employee the right to join, and to enjoy the benefits of, an independent union of his choice. This proposal exposes not only itself, as has been so amply demonstrated, but the whole motivation of this Bill, in one fell swoop. Like the noble Lord, Lord Campbell of Alloway, I too can recognise an elephant when I see one and I can see what is the purpose of this clause.

It is to put one more weapon into the armoury of employers and, as the noble Lord, Lord Rochester, said, it is to add one more weight to the scales which are already weighted exorbitantly in favour of the employer and against his employees. The arguments we have heard today are based on the purported rights of the individual to enter freely into a contract of his choosing with his employer. This is not a debate on political philosophy. To understand the motivation behind this clause a pathologist rather than a political philosopher is more helpful. It goes deep into the terrible apprehension and fear of this Government of combinations formed by working men to enable them to talk with employers from some basis of equality because of the employees' obvious and clear inequality in terms of their power in industry. This clause is not new. I shall take the noble Viscount even further back in history to 1833 when the employers of the day in the building industry introduced infamous documents which insisted that trade unionists should renounce membership of their trade unions and to engage themselves not to support any other trade unionist in a contest with his employer. The response of trade unions in those days was to ignore the document; to say that it had been imposed upon them by force majeur; and that they were having no part of it. Until now, trade unionists believed that they had the protection of the law.

As my noble friend Lord Wedderburn made abundantly clear, this is not a question of the law being confused; it is a question of the law being far too clear for the Government's liking. Why do they not say so? They do not like it, so even before it has been further clarified they intend to eliminate the possibility asserted by the Court of Appeal. The substance and vindictiveness of the clause, and the way in which it has, hugger-mugger, been brought to this place can only. I believe it was the noble Lord, Lord Campbell of Alloway, who said this, but he will forgive me if it was not—bring the law and the legal processes into contempt. It is a result which I, like other noble Lords, would deprecate, but that will be the consequence.

Trade unions are right to be suspicious of the law and the role it is supposed to play in the regulation of their relationships with employers. This is a clause too far. If it is embodied in the law, an employer will be able to tell trade union members that they can have their wage increase only by signing away their trade union rights, because the Government have removed the protection that they thought they had. The only response of a decent and honourable trade unionist will be to say, "In concert with my fellows, I shall no longer work for you", and to take industrial action. Any trade unionists with decency and integrity will refuse to bow down before such an imposition. For them, as has been said in another and less noble context, there is no alternative.

Lord Mottistone

I have consulted the CBI which tells me that employers support Amendment No. 1. The amendments to it will only weaken that amendment. As I understand it, the amendment does nothing more than restate the right of the employer to seek to order his relations with his staff in a way which is considered most appropriate for the organisation concerned. More and more employers are moving to individual arrangements with their employees where-by reward is tailored to individual performance.

Without the amendment, the Court of Appeal ruling threatens to disrupt those welcome developments which are paying off in terms of improved performance, productivity and competitiveness in the private sector and in the public services. The amendment is consistent with the commitment given by the Government in last year's White Paper People, Jobs and Opportunity, that they would take action to encourage employers to move away from centralised pay bargaining to individual contracts and rewards.

Many employers in both the public and private sectors have moved to individual terms and conditions, and many more wish to do so. Few have encountered any employee opposition to those arrangements. To clarify the situation, the wise thing for the Committee to do would be to support the Government's amendment and to resist the various amendments which will serve only to weaken it and not enable it to carry out its purpose, as the Opposition propose.

Viscount Ullswater

I listened carefully to the noble Baroness, Lady Turner, when she introduced the amendment. She spoke in rather broader terms than the narrow scope of the amendment—I shall return to the amendment in due course—as did the noble Lord, Lord Rochester. In many instances I agree with what the noble Lord, Lord Rochester, said. We want to encourage employee/employer relations. I believe that we seek to do so. The noble Lord has certain approaches to that which we may not share, but I do not seek to criticise what he said.

My noble friend Lord Campbell of Alloway, again in general remarks which went rather wider than the narrow scope of the amendment, identified rightly the need to define the employer's purpose in this instant. That is what the Government's amendment seeks to do where the law is unclear. Perhaps I may take up one point with him. He drew from the quotation which I gave of my noble friend Lord Ferrers. My noble friend Lord Campbell of Alloway said that the difference which my noble friend was pointing out was not between taking away a company car and a difference in wage rates. That is how he explained it. But what is meant by that, and what is clear from that, is that it was an action directed towards an individual and towards a group or class of employees; that is, a collective action. I seek to persuade my noble friend that my noble friend Lord Ferrers was trying to differentiate between an action against an individual and one against a group or collection of individuals.

The amendment seeks to undermine one of the central purposes of our amendment. It is clearly contrary to the effect of Section 146 in its present form. We believe that an employer should be free to seek to establish the bargaining arrangements with his workforce that he believes are best suited to the needs and circumstances of his organisation. He is best placed to decide on such issues. We do not consider it to be the Government's role to put obstacles such as the amendment proposes in his way.

My noble friend Lord Mottistone confirmed the view taken by the CBI. I am pleased that I am not a lone voice when I try to persuade the Committee that those are the views of employers. In seeking to establish new arrangements, an employer may wish, as we have seen in recent cases, to offer incentives to his workforce to accept the new arrangement. What is wrong with that? It is up to the employees concerned whether they accept those incentives. So long as the employer is not singling out trade union members, and penalising them for being trade union members, then such action has nothing to do with the law on action short of dismissal, which our amendment seeks to clarify.

The noble Lord, Lord Moyne, asked me whether we were changing the law on individual rights. No, Section 146 protects individual rights. The Government's amendment does not seek to interfere with them. It clarifies the position with regard to an employer's rights to choose his own negotiating arrangements. The noble Lord, Lord Wedderburn, cannot ignore or disregard the words of the Government spokesman at the time the present law was introduced. Contrary to what he asserted, we have considered carefully the Court of Appeal judgment. We are clear, in the light of that judgment, that the law needs to be clarified to ensure that it achieves the intended purpose. The Government do not accept that the only benefits of trade union membership accrue through recognition of the union by the member's employer. Presumably neither do the thousands of individual trade union members who work for an employer who does not recognise their union.

Members of the Committee may have seen that the Court of Appeal's decision in the two recent cases did not dispute an employer's right to de-recognise a union. Lord Justice Dillon stressed that very issue, as the noble Lord read out in the judgment. The court's decision rested on its interpretation of the purpose of the offer of an inducement to those who agree to enter personal contracts. That is the point at issue.

As I have made clear, the important question in this section is not whether the employer recognises a trade union, or how the employer negotiates with those who are not trade union members, but whether the action is taken against an individual on grounds of trade union membership or non-membership. That is what we are seeking to clarify in the amendment—

5 p.m.

Lord Wedderburn of Charlton

Before the Minister leaves that point perhaps I may ask whether he is again making the point that he made earlier: that any action by the employer which deals with a collection or group of employees is a collective matter. Does the Minister accept that the employer (as in the case concerned in the Court of Appeal) dealt with a number of individuals on the grounds that—in the words of one of the dissenting industrial members—by ensuring that the union withered on the vine he also discriminated against the individuals at that place of work who did not wish to accept his douceur?

Viscount Ullswater

I believe that the original intention of the law was perfectly clear. Perhaps the noble Lord, Lord Wedderburn, would care to look at the amendment. I also address the noble Lord, Lord McCarthy, because he introduced the concept of an attack on individual rights in the provision: In determining what was the purpose … there is evidence that the employer's purpose was to further a change in his relationship with all or any class of his employees". That is what the Government are saying. That was the original intention to which the noble Lord, Lord Jacques, addressed himself. He made clear the intentions of the Government of the day in creating that legislation. At the time Section 146 related to individual protection and not to collective bargaining issues. I believe that our amendment restores that intention, which recent cases have confused.

I listened carefully to the words of the noble Lords, Lord Howie of Troon and Lord Murray of Epping Forest, who took us back even further than the genesis of this section. The noble Baroness, Lady Turner, mentioned the Armitage case. Nothing in the new clause is intended to overturn the principles expressed by the Employment Appeal Tribunal in deciding the Armitage case and nor will it do so. The EAT found that action was against Mrs. Armitage as an individual on grounds of her trade union membership. Therefore, there is a distinction between the Armitage case and the amendment that we are seeking to move—

Lord Howie of Troon

Does the Minister recall the 200 employees of British Telecom who were offered a wage freeze if they declined personal contracts? Is the Minister trying to persuade us that that was not a class of employee but was a random agglomeration of 200 individuals?

Viscount Ullswater

One must be careful in one's interpretation of "individual" and "class", which Section 146 was set down to do. It was intended to prevent individual discrimination and not class discrimination in that sense.

It is sufficient therefore, that the new clause should make it clear that Section 146 does not apply to actions which are taken with a purpose of altering bargaining arrangements. How those bargaining arrangements are to be arrived at is irrelevant and the effect of this amendment would be to indicate that any change—returning to the wording of the amendment—that was not negotiated and agreed could be considered as action taken to deter union membership.

Indeed, the noble Baroness's amendment would potentially run counter to one of the findings of the Court of Appeal in the recent cases. The court's judgment made it clear in its decision that it did not dispute an employer's right to de-recognise a union and, as a consequence, make changes in the terms and conditions of the employee's employment. As I explained earlier, that at least is in line with what Parliament had always understood and intended. The amendment, however, would appear to require an employer to negotiate on these matters in order to avoid the risk of being found to be in breach of Section 146. That is unacceptable to the Government. I believe that the amendment is misconceived and I ask the noble Baroness to withdraw it.

Earl Russell

Before the Minister sits down will he tell me whether he has taken legal advice on whether his amendment is contrary to European law?

Viscount Ullswater

I did not address my remarks to the noble Earl. Of course, the amendment proposed is for domestic reasons and for the clarification of existing law. We do not believe that there is any infringement of any international obligations.

Earl Russell

Is that opinion based upon any legal advice?

Viscount Ullswater

I should have to take advice upon that.

Baroness Turner of Camden

I am not altogether surprised that the Minister does not accept my amendment to his amendment. However, at the outset of his remarks he said that the Government's intention —their desire—was to encourage employee and employer relationships. If that were so it would be sensible for employers who wanted to embark on any far-reaching structural changes in their industrial relations to do so via a negotiated agreement. As we have said on a number of occasions, our contention is that the Government's amendment is not required because there is no need to clarify. In fact, the noble Lord, Lord Campbell of Alloway, put forward the crux of the matter when earlier in the debate he quoted from the judgment of Lord Justice Dillon.

We are not talking about individuals as opposed to collectives. We clearly understand that the employer has the right to end collective bargaining arrangements if he wishes to do so. We are talking about action taken against individuals. Mr. Wilson was an individual who was disadvantaged because he refused to give up the right to trade union representation. In a nutshell that is what the issue is all about.

But the Government have introduced their amendment because they believe that employers may wish to change their arrangements. Those arrangements may require the employers to do all kinds of things that are not provided for in Section 146 and so forth. All right, if the Government want to introduce new arrangements it is logical and legitimate to do so through a negotiated arrangement with the people concerned. Why should people—collections of individuals —have different arrangements imposed upon them? If they do not like those arrangements presumably the only recourse will be to leave their employment. That is not easy when there is not much alternative employment to be had.

I am not satisfied with the Minister's response to this small and I believe entirely reasonable amendment. It provides that if an employer wishes to change structures which affect individuals he should negotiate and endeavour to agree those arrangements. In view of the Government's response I have no alternative but to test the feelings of the Committee.

5.10 p.m.

On Question, Whether the said amendment (No. 2) to Amendment No. I shall be agreed to?

Their Lordships divided: Contents, 105; Not-Contents, 130.

Division No. 1
CONTENTS
Ackner, L.	Attlee, E.
Addington, L.	Aylestone, L.
Archer of Sandwell, L	Beaumont of Whitley, L
Ardwick, L.	Birk, B.

Blackstone, B.	Judd, L.
Bonham-Carter, L.	Kennet, L.
Boston of Faversham, L.	Kilbracken, L.
Bottomley, L.	Kirkhill, L.
Bridge of Harwich, L.	Listowel, E.
Brightman, L.	Llewelyn-Davies of Hastoe, B.
Brimelow, L.	Longford, E.
Bruce of Donington, L.	Lovell-Davis, L.
Carmichael of Kelvingrove, L.	McCarthy, L.
Castle of Blackburn, B.	McIntosh of Haringey, L.
Chorley, L.	Mallalieu, B.
Cledwyn of Penrhos, L.	Merlyn-Rees, L.
Clinton-Davis, L.	Milner of Leeds, L.
Cocks of Hartcliffe, L.	Molloy, L.
Croham, L.	Morris of Castle Morris, L.
Dacre of Glanton, L.	Moyne, L.
David, B.	Mulley, L.
Dean of Beswick, L.	Murray of Epping Forest, L.
Desai, L.	Nicol, B.
Donoughue, L.	Ogmore, L.
Dormand of Easington, L	Peston, L.
Eatwell, L.	Pitt of Hampstead, L.
Ennals, L.	Prys-Davies, L.
Falkender, B.	Rea, L.
Falkland, V.	Redesdale, L.
Fisher of Rednal, B.	Richard, L.
Gallacher, L.	Ritchie of Dundee, L.
Galpern, L.	Rochester, L.
Gilmour of Craigmillar, L.	Russell, E.
Gladwyn, L.	Sainsbury, L.
Glasgow, E.	Sefton of Garston, L.
Graham of Edmonton, L. [Teller.]	Serota, B.
	Shackleton, L.
Greene of Harrow Weald, L.	Shepherd, L.
Gregson, L	Stoddart of Swindon, L.
Hanworth, V.	Strabolgi, L.
Harris of Greenwich, L.	Taylor of Blackburn, L.
Hayter, L.	Taylor of Gryfe, L.
Hilton of Eggardon, B.	Tonypandy, V.
Hollick, L.	Tordoff, L.
Holme of Cheltenham, L	Turner of Camden, B.
Hooson, L.	Wallace of Coslany, L.
Houghton of Sowerby, L.	Wedderburn of Charlton, L.
Howie of Troon, L.	White, B.
Jay, L.	Wigoder, L.
Jay of Paddington, B.[Teller.]	Williams of Elvel, L.
Jeger, B.	Williams of Mostyn, L.
Jenkins of Hillhead, L.	Wilson of Rievaulx, L.
John-Mackie, L.	Winchilsea and Nottingham, E.
NOT-CONTENTS
Abercorn, D.	Carnock, L.
Alexander of Tunis, E.	Cawley, L.
Allenby of Megiddo, V.	Clark of Kempston, L
Annaly, L.	Clinton, L.
Archer of Weston-Super-Mare,	Cochrane of Cults, L.
L.	Constantine of Stanmore, L.
Arran, E.	Cox, B.
Astor, V.	Cranborne, V.
Astor of Hever, L.	Crickhowell, L.
Auckland, L.	Cullen of Ashbourne, L.
Barber of Tewkesbury, L.	Cumberlege, B.
Bessborough, E.	Davidson, V.
Birdwood, L.	Denham, L.
Blake, L.	Denton of Wakefield, B.
Blatch, B.	Derwent, L.
Borthwick, L.	Ellenborough, L.
Boyd-Carpenter, L.	Elles, B.
Brabazon of Tara, L.	Elliot of Harwood, B.
Braine of Wheatley, L.	Elliott of Morpeth, L.
Bridgeman, V.	Faithfull, B.
Brigstocke, B.	Fraser of Carmyllie, L.
Brookeborough, V.	Fraser of Kilmorack, L.
Brougham and Vaux, L.	Gainsborough, E
Butterworth, L.	Glenarthur, L.
Cadman, L.	Goschen, V.
Caithness, E.	Granard, E.
Campbell of Alloway, L.	Grimthorpe, L.
Campbell of Croy, L.	Haig, E.
Carnegy of Lour, B.

Hailsham of Saint Marylebone,	Nelson, E.
L.	Norfolk, D.
Halsbury, E.	O'Cathain, B.
Harlech, L.	Onslow, E.
Harmar-Nicholls, L.	Oppenheim-Barnes, B.
Harmsworth, L.	Orkney, E.
Harvington, L.	Palmer, L.
Hayhoe, L.	Park of Monmouth, B.
Hemphill, L.	Pender, L.
Henley, L.	Peyton of Yeovil, L.
Hesketh, L. [Teller.]	Plummer of St. Marylebone, L.
Holderness, L.	Reay, L.
HolmPatrick, L.	Rennell, L.
Hood, V.	Renton, L.
Hooper, B.	Rodger of Earlsferry, L.
Howe, E.	St. Davids, V.
Hylton-Foster, B.	Salisbury, M.
Johnston of Rockport, L.	Saltoun of Abernethy, Ly.
Lauderdale, E.	Seccombe, B.
Layton, L.	Shannon, E.
Long, V.	Shrewsbury, E.
McColl of Dulwich, L.	Stewartby, L.
Mackay of Ardbrecknish, L.	Strathclyde, L.
Mackay of Clashfern, L.[Lord Chancellor.]	Strathmore and Kinghorne, E [Teller.]
Macleod of Borve, B.	Sudeley, L.
Manchester, D.	Tebbit, L.
Mancroft, L.	Terrington, L.
Manton, L.	Teviot, L.
Marlesford, L.	Thomas of Gwydir, L.
Marsh, L.	Thurlow, L.
Merrivale, L.	Ullswater, V.
Milverton, L.	Vaux of Harrowden, L.
Morris, L.	Wakeham, L.[Lord Privy Seal.]
Mottistone, L.
Mountevans, L.	Westbury, L.
Mowbray and Stourton, L.	Whitelaw, V.
Munster, E.	Wynford, L.
Murton of Lindisfarne, L.	Young, B.

Resolved in the negative, and amendment to the amendment disagreed to accordingly.

5.28 p.m.

Lord Wedderburn of Charlton moved, as an amendment to Amendment No. 1, Amendment No. 3:

Line 6, after ("further") insert ("by lawful means").

The noble Lord said: Amendment No. 3 pursues the same objective which is apparent in a number of the amendments; namely, to moderate the extreme character of the Government's amendment.

First, the Government's amendment amounts to what one might call a grade (a) and a grade (b) purpose. The essence of the Government's amendment is that where the employer has a grade (b) purpose—that is, a purpose to discriminate contrary to Section 146 on trade union grounds or, although I do not believe our side of the Committee will make much of this, on, curiously enough, non-trade union grounds—he nevertheless escapes from the regime which has been the law since 1971 if he can show a grade (a) purpose. A grade (a) purpose is anything which shows that he is furthering a change in the relationship with all or any class of the employees.

In moving the amendment, there is an attempt to say that the Government may have that regime but surely the employer should be able to prove a grade (a) purpose only where his aim is to use lawful means or to adopt the objective of a change in that relationship by lawful means. More important, evidentially, is the fact that the Government's amendment does not speak of Section 146. Members of the Committee may have noticed that it refers to Section 148. Of course, the latter section is the sanction, or procedurally the remedying part, of the regime in the consolidation Act which, again, has virtually always been the same. In other words, the employer here is before the tribunal because he has adopted a grade (b) purpose of discrimination, but he will escape by proving any, and however small, grade (a) purpose for changing the relationship at work on his initiative and, as we have just seen, without any need to negotiate with anyone.

As the Government's amendment stands, it would include a case like that decided by this House's Judicial Committee in 1988 of Rigby v. Ferodo where an employer insisted upon a reduction in wages. He imposed it and refused to negotiate it. He, perhaps, made the mistake from his point of view of allowing the employee to continue to work—we shall come to that point in a moment—and the employee eventually claimed the back pay that he had lost by reason of the reduction. It is a very unusual case in the way that the facts turned out; but the Judicial Committee had no doubt whatever that the employee's right of action was secure, because the contract had been broken.

In the present case, the same employer may impose a penalty upon the employee—perhaps, for example, a wage reduction —thereby furthering, according to his evidence (which has to be there), a change in the relationship of the workforce. As I understand it now, the noble Viscount would accept that such decisions were individual decisions even though they referred to a "class". The employer may say, "I am reducing the wages of all my employees. I know that that will be deeply resisted by those who want to call in their union officials, but I am not having any union officials in here".

The noble Viscount accepted that the decision in the Discount Tobacco and Confectionery Ltd. v. Armitage case still stands. Therefore, the latter situation would be a breach of Section 146 and the employee would have no chance of bringing an action before the tribunal, unless he could prove that the employer had taken action which no reasonable employer would take. I believe that the Government would strongly resist the idea that the employer had taken action that no reasonable employer could take. That is a very different formula. I must point out to the Minister that it is not the same as saying that the employer has or has not taken reasonable action or adopted something that is reasonable. It is quite different. In order to prove that the employer had adopted an action which no reasonable employer could take, one would virtually have to prove that the employer had become irrational in the sense of the word always used by Lord Diplock.

I ask the Minister the following question in passing. It is possible that now is not the time to answer it. If so, I shall understand because it is a difficult matter. However, I have a practical problem with the amendment. Is it the case that, in the kind of situation that I have described, the burden then passes, as I think it does, to the employer to show that he is not an irrational employer? Alternatively, is it the Government's understanding that, under their amendment—as one of the Minister's phrases may have indicated, although he may not have been dealing with the present issue—the employee would have to prove the points by evidence all along the line; that is to say, he would have to prove that the proviso exists and applies unless it is considered that the action is such that no reasonable employer would take it, having regard to the purpose mentioned in paragraph (a)? Members of the Committee will notice that the tribunal must have regard, again, only to a grade (a) purpose.

Therefore, if the amendment to Section 148 does not include any such phrase as that contained in our amendment—namely, "by lawful means"—that would allow the employer to get through that web of the new network of rules simply by having the affidavit that is necessary to show that he has evidence that he wishes to take on the role of changing the relationship at work—however illegal that change or the means may be. He can sit on a raft of grade (a) purposes in a sea of illegalities created by his own grade (b) purposes and still win the case.

I mentioned earlier that I had discussions over the weekend, as I am sure did other Members of the Committee, with lawyers and others about the effect of the amendment. It was put to me very strongly by a few of them that unless the phrase, a change in his relationship", was governed and limited by something like the words "lawful means", it would allow the employer to win by doing anything, including taking illegal action. It is not restricted to a change which the employer is in any way entitled to make. As one adviser put to me, if the employer changes job descriptions and working hours for the purpose of achieving a flexible workforce (as he would put it) and on the way penalises any employee who complains to the union or deters those who want to attend a union meeting or bring in a union official, that is all permissible. Moreover, it is all permissible so long as the collateral purpose exists of having a view to change the relationship at work. We shall return later to that phrase.

There can be no pretence whatever as to whether or not the Government's amendment adopts any part of the Court of Appeal decision; or, indeed, those of the Employment Appeal Tribunal. Members of the Committee should not take from the previous debate the idea that the EAT's decisions in the Palmer and Wilson cases are in any way what the Government's amendment would lay down as the law. For example, the Wilson case was an interpretation, albeit one that proved to be wrong and rather novel, of the existing Section 146. I repeat, if the Government refuse or reject an amendment of the kind now before the Committee and reject the idea that the employer's objective and purpose must be limited to "lawful means"—or even "lawful objectives"—we can, if they wish, add something by way of manuscript amendment and state, by lawful means and objectives". The Government are in fact legislating to allow employers to use unlawful means. It is very simple: that which is unlawful today would be the equivalent, quite clearly., of what the Government have in mind. My noble friend Lord Murray mentioned 1833. Of course, that is the right time to consider. At that time, the Master and Servant Acts were in force and a great deal of contract employment was criminal. They know that they cannot make it criminal now, so they want to give all power to the employer in civil law. It is as easy as that. If we accept the amendment, we would be accepting a new master and servant law. I beg to move.

Viscount Ullswater

I am grateful to the noble Lord, Lord Wedderburn, for the explanation of the purpose of the amendment under consideration. The amendment seeks to qualify further the circumstances in which an employer may be found not to be in breach of Section 146 by virtue of the purpose for which he has taken the action in question. Our new clause provides that, where there is evidence that the employer's purpose was to further a change in his relationship with his employees as well as evidence that his purpose falls within the scope of Section 146, then the tribunal is directed to treat the first purpose as the relevant purpose—always provided, that is, that the act in question was reasonable.

The noble Lord asked what was the test of reasonableness and who would have to provide it. I am advised that the tribunal will obviously have to make up its own mind, based on the evidence before it, as to whether or not it was reasonable. Therefore, if I may say so, it is a neutral situation between the employer and employee.

The amendment moved by the noble Lord, Lord Wedderburn, is, quite simply, unnecessary. It is not part of our intention, or the effect of the clause, that acts that are otherwise unlawful when the provision becomes law should be treated as lawful. That is most certainly not the position in law. This provision will not undermine any other rights that individuals may have in law.

I am sure that it is unintentional, but the amendment also has the potential to confuse the tribunal. It is not clear with regard to what law it is expected to establish the lawfulness or otherwise of the employer's actions. If the amendment appeared to introduce the possibility that it should assess whether the employer's actions would be lawful except for the effect of this new provision, then it will reach an impasse, and the purpose of the provision will be undermined. I am sure that this cannot be the intention.

It is clear, though, that the noble Lord, Lord Wedderburn, has some very legitimate concerns about the possible intimidation of individuals at work by their employer. Let me make it perfectly clear that I share this concern. Individuals should not be subject to intimidation at work because they are or are not trade union members. That is precisely what Section 146 was designed to protect against, and our amendment does not frustrate this. I believe I said that in answer to my noble friend Lord Moyne on the previous amendment.

An individual who is intimidated by his employer—the noble Lord, Lord Wedderburn, cited a case—allegedly for the purpose of furthering a change in his relationship with his employees will be protected in two ways under this new provision. First, a tribunal is unlikely to find that there is genuine evidence that the employer's purpose was to further that change in his relationship. Secondly, even if it does so find, the employer's actions are subject to a test of reasonableness, a test which an act of intimidation would not pass. I hope that these points have reassured the noble Lord on the issue of potential intimidation.

I believe that there is no need for this amendment. The Government's new clause does not, as some would appear to fear, give employers carte blanche to do as they will. Individual rights are still protected. I hope therefore that the noble Lord will be persuaded to withdraw the amendment.

5.30 p.m.

Lord Wedderburn of Charlton

I thank the Minister for that reply. However, with great respect to him, I should say that it does not come to the point. The test is not a test of reasonableness; it is a test of whether the action was such that no reasonable employer would take it. That is a totally different test. If the noble Viscount is advised that they are the same, I can only take issue with him and that advice and suggest to him that that is not the case. It is quite clear that the courts would not turn that into a test of reasonableness. One has to say, "There are all the facts and the employer in question could not be a reasonable employer taking those facts into account". That is a quite different matter. If I had to look after the noble Viscount, or he me, and our duty is one of reasonable care, that is one thing. But if we have to avoid damage to the other by a step which no reasonable human being could take, that is a much higher duty of care in terms of any possible plaintiff, and a lower duty of care in terms of the defendant.

I begin to wonder what the Government are doing in this rushed legislation. The noble Viscount was asked earlier in the debate by the noble Earl, Lord Russell, whether he had taken advice on this matter. I cannot repeat the noble Viscount's exact words but I believe he said that he thought he had taken enough advice. I can only suggest to him that he has not taken enough advice. I do not believe anyone who has been briefed on this point could come to the opinion that it is a test of reasonableness. I hope he will accept that.

Of course Section 146 will still exist but it will not operate in favour of the plaintiffs for whom it was devised as the Government's amendment will remove that protection—the paragraph (b) protection—whenever the employer can give evidence that he has a paragraph (a) purpose. His legal advisers at any rate, and perhaps he himself, would have to be so negligent as to be almost deserving of committal not to be able to draft a suitable affidavit. The employer is not someone whom I cast in the role of an evil genius or demon. He is someone trying to run a business. However, if he asks whether he can carry out this provision, and he is told that he can, he may do it. He would only have to say he thought that was the best way to proceed. He does not have to care about trade union rights with regard to his individual employees. He does not have to care whether he is taking unlawful action.

The noble Viscount has said that if an employer carries out an unlawful action, the persons against whom that is committed will still have rights. But why should that provision cancel out someone else's trade union rights? If under the new definition an employer refuses to consult according to the European directive of 1975, he may, where he proposes dismissals by reason of redundancy, in the same course of action discriminate in terms of trade union members. He may discriminate against trade union members when he selects staff for redundancy. Certain people may have rights as regards that selection or that failure to undertake consultation with a recognised union, but the rights under Section 146, which some employees in such a situation may have as their only remedy, would disappear. The people who can sue under the other rights I have referred to will still sue. However, the employer has taken unlawful action and he has taken that action to discriminate against trade union members and yet, because he claims his action furthers a change in his relationship with the workforce, he can cite it in evidence as the answer to his liability.

This is "master and servant" legislation. The section we are discussing, above all sections passed since 1980, is a class section. This is class legislation. The Government are depriving people of their fundamental rights that are recognised throughout the world. The Government are saying, "I am depriving them of those rights because the employer can further his purposes with regard to the workforce". If one asks the Government whether they can limit the action to where an employer is acting lawfully, the answer is no. The Government are acting in a class biased way and the world as a whole needs no further proof of that. One day when the technicalities of this section are explained more widely, it will be seen clearly that that is so. Ministers who are proposing this legislation will in the future be ashamed of its terms. I beg leave to withdraw the amendment.

Amendment No. 3, as an amendment to Amendment No. I, by leave, withdrawn.

[Amendment No. 4, as an amendment to Amendment No. 1, not moved.]

Lord Wedderburn of Charlton moved, as an amendment to Amendment No. 1, Amendment No. 5:

Line 10, after ("section 146") insert ("but not such as to infringe the right to form or join trade unions set out in the European Convention for the Protection of Human Rights and Fundamental Freedoms of 1950 or the right to organise in the Council of Europe Social Charter of 1961.").

The noble Lord said: In moving this amendment I seek to ascertain what the Government's position is on this important matter of fundamental rights. The Committee will understand that, having had a somewhat broad debate on the first amendment—I make no complaint about that—it is useful for us to look for the areas which were not covered or which need further explanation by the Government.

I take it that it is quite clear that the Minister will not accept any amendments today, no matter how we may re-jig them. I asked him earlier this afternoon whether he had the authority or the ability to accept an amendment if he suddenly had a flash of inspiration and saw merit in anything we were doing. As that is impossible, we should place on record our comments on how awful the Government's amendment is. We should also try to understand the Government's position—I have not been able to understand it so far—on international instruments.

Amendment No. 5 states that the employer's purpose should not be, such as to infringe the right to form or join trade unions set out in the European Convention for the Protection of Human Rights and Fundamental Freedoms of 1950 or the right to organise in the Council of Europe Social Charter of 1961".

If the Minister has no objection, I shall speak also to Amendment No. 6 and mention the position of the ILO convention. We did not move Amendment No. 4, which states: there is no evidence that the employer's predominant purpose was to cause the dismissal of or otherwise prejudice any employee by reason of his membership of an independent trade union".

The wording of that amendment follows almost precisely the wording of the International Labour Organisation Convention No. 98 on the right to organise and collective bargaining.

The International Labour Organisation convention, the European Convention on Human Rights, the Council of Europe Social Charter and the European Community Social Charter, whose wording is reflected in Amendment No. 6 and which I apprehend was agreed by only 11 member states with the right to choose whether or not to join, albeit in slightly different ways, all contain an understanding that the right not to be prejudiced at work by reason of trade union membership does not mean only going to work with a union card in one's pocket. The ILO is the most firm, the European Convention on Human Rights and the European Social Charter are different but strong, and the European Community Social Charter is rather weak. In addition to the instruments that I have mentioned there are many other international covenants and regional charters on human rights. There is no clear holding by any international body which limits the right to be a trade union member to the right merely to have a union card.

Beyond that there are certain areas which some international instruments stress more than others. I want to know from the Government which areas would be left under the regime which they set up under the amendment. What action would be possible in terms of the individual employee, which would still be prejudiced under discrimination under Section 146, but which the employer could not remove by saying simply that he has an intention and purpose to further the relationship being changed among the workforce? If there is no clear example then the Government are at risk of being in breach and in contravention of virtually all those international instruments. The one which comes to mind is the International Labour Organisation Committee on Freedom of Association—which we have chosen not to take as one of the three provisions, but nevertheless it is relevant—together with the Committee of Experts, which comprises 20 independent experts nominated for the ILO. All have termed parts of the legislation from 1980 until today as contraventions of Conventions 98 and 87.

The Government are simply trailing a coat if they do not add any limitation here, because they will be held to be in breach of Convention 98 as soon as winter turns to summer. I believe that they know that. The Government's real position on the ILO convention, the European convention and the 1961 Social Charter is not really that they are not in breach. They have to say that. Their position is really that they know a better place to go to and have a better way of doing things than those old-fashioned conventions. It would be much better if the Government said that.

However, if, as I believe he will be compelled to, the noble Viscount tells us that there is no breach of any of those international instruments and conventions then I believe that he is flying in the face of all the evidence. It would be possible for a case to go relatively quickly to the Strasbourg court under the European convention on the protection of human rights. I am sure that the Government will have had that in mind. I invite the noble Viscount to tell us what the Government's defence would be. I beg to move.

5.45 p.m.

Viscount Ullswater

At the outset I can assure the noble Lord, Lord Wedderburn, that the Government are fully committed to their obligations which arise from international treaty. That includes obligations arising under the European Convention on Human Rights and the Council of Europe Social Charter. We would not have proposed the new clause to which the amendments relate if we did not believe that its provisions would be anything other than compatible with those obligations.

In answer to the noble Earl, Lord Russell, the Government have not taken legal advice outside Government on the matter. However, the Government are satisfied that there is nothing in the amendment which is in breach of our EC or other international obligations.

Frankly, if we were to accept the amendment, we would run a very strong risk of distorting the nature of certain international obligations which have long been accepted by different governments, both Conservative and Labour. It has always been evident that both the ECHR and the Council of Europe's Social Charter create certain rights and obligations. No one would deny that.

Equally, however, it has always been accepted that guarantees and obligations arising under those international instruments fall to be enforced in particular ways. The amendments propose completely to alter those longstanding arrangements.

Nothing in the new clause will undermine in any way the present right of any individual to petition the European Commission of Human Rights on the basis of a claim to be the victim of a violation of the rights set out in that convention. There have, of course, been cases where individuals—having properly exhausted domestic remedies —have made such petitions. Indeed, in the case of British Rail employees dismissed for refusing to join a specified trade union, in accordance with a closed shop agreement brought in during the 1970s, not only was such a petition made but the commission referred the case to the European Court of Human Rights and the court upheld the former employees' complaint.

We never found out, of course, exactly what the then Labour Government proposed to do in response to that judgment. As it was, this Government were very happy to enact legislation which swept away the scope for the unjust practices that typified the closed shop.

We would certainly not willingly risk putting the UK in jeopardy of another judgment such as was given by the European Court of Human Rights in the British Rail case. We do not believe that we have done so by proposing the new clause.

Since 1953 all UK governments—whether Conservative or Labour—have been content for the ECHR to be applied in that way. Why then should we suddenly contemplate such a fundamental change as the amendment proposes? We must ask ourselves whether it would be either appropriate—or practicable—for domestic courts or tribunals to attempt to decide for themselves whether a particular action or purpose was an infringement of the ECHR.

In the Government's view, and taking proper account of the judicial practices and traditions of this country the answer to that question must be "No". Respect for the ECHR simply does not require us to adopt such arrangements. It is enough that our legislation does not infringe its provisions, and that the Government are ready to amend the law to do so, if necessary. The proposal that our courts and tribunals should make their judgments and decisions with reference to the articles of the Council of Europe Social Charter is even more radical. I should add that it is at least equally inappropriate—and perhaps even more so.

The terms of the Council of Europe Social Charter clearly apply only to the "contracting parties", who consider themselves bound by the obligations laid down in its articles. The UK Government are, of course, just such a party.

However, there is no, and never has been, individual right of complaint relating to purported breaches of those particular obligations. Instead, compliance with relevant obligations is assessed by reporting and supervisory mechanisms within the Council of Europe itself.

It follows, therefore, that to require UK courts, or tribunals, to have reference to the articles of the Social Charter in deciding cases before them would be quite incompatible with the intended operation of the Social Charter itself.

To summarise, the Government are convinced that proper respect for the obligations arising out of either the ECHR or the Council of Europe's Social Charter does not require the establishment of arrangements along the lines proposed by the amendment.

I hope, therefore, that the noble Lord will see fit to withdraw the amendment.

Lord Wedderburn of Charlton

The explanation that the noble Viscount has been good enough to give us is the explanation which the Government have given—I shall read it to see whether it is the same text —every time an issue is raised on any international instrument. They never argue as to why the instrument would not be broken, but refer to the fact that they never break it, that they have not broken it, and that they never will break it, and noble Lords must be satisfied with that.

I refer to the ILO Committee of Experts Report 1992. The same passage appears in the 1989 report to the Government. It states that the committee considers the overall effect of legislative change in this area since 1980 is to withdraw protection from strikes and other forms of industrial action in circumstances where such action ought to be permissible. It later continues by saying that the committee: would ask the Government to introduce amendments which enable workers to take industrial action against their 'real' employer and which accord adequate protection of the right to engage in other legitimate forms of industrial action such as protest strikes and sympathy strikes, as guaranteed by Articles 3, 8 and 10 of the Convention. Repeatedly for six years the ILO has thus gone on record. The Committee on Freedom of Association in case 1546 has also accepted that analysis, as has the National Union of Seamen in its case. The Government all the time have stated that they are not in breach of the convention.

We do not know what they have said to the ILO. We are about to know because the noble Viscount was good enough to say that the documentation will be in the Library. Some parts are in the Library in the House of Commons in a bout of democratic fervour. However, we have it in the Library today.

The noble Viscount did not answer my question. That is not unknown although he usually answers most of my questions. I asked whether or not he could possibly accept the amendment or any other amendment today. He states that a way of incorporating part of those international instruments into our law would be to accept and recognise them in the amendment on the Marshalled List today. In certain respects I accept that. The European Social Charter 1961 is a good example. However, taking a standard from such a charter—the European Convention on Human Rights or Convention 98 of the ILO, which we have ratified and are supposed to adopt and accept—is surely the right way to proceed if we do not wish to be held in contravention.

Looking back over the years, I am very dissatisfied with the way that the Government have dealt with the matter of international instruments. On the one hand they say that they like them when they have a decision such as the three railway men's case in 1981 on the closed shop. With great respect to the noble Viscount, the court did not say exactly what he suggested. It will be interesting to see whether they like so much the recent decision in the Sibson case which was recently reported in the same court.

The Government have the tendency to select the cases that they like and not the cases that they do not like. That is what is happening today. They like a bit of the EAT judgment. They dislike that of the Court of Appeal. However, they will not allow the Court of Appeal judgment to be reversed with reference to international instruments which we have ratified and should observe. That is a strange posture.

However at this stage I can do no more than beg leave to withdraw the amendment.

Amendment No. 5, as an amendment to Amendment No. 1, by leave, withdrawn.

[Amendment No. 6, as an amendment to Amendment No. 1, not moved.]

Lord Wedderburn of Charlton moved as an amendment to Amendment No. 1, Amendment No. 7:

Line 11, leave out ("shall") and insert ("may").

The noble Lord said: The amendment looks small but it may be important. I hope that the Government will give us some good reason if they do not accept it. As the provision stands, the government amendment demands that the industrial tribunals tell a lie. The tribunals are by order, by fiat, of the Government's new clause, compelled to tell a lie. They must say whether there is evidence of the offence within Section 146. We must say that there was not, if there is evidence of a grade (a) character, as I called it earlier in Committee. The industrial tribunal is then told to find that the paragraph (b) purpose does not exist unless it is proved that the employer is irrational in his actions or could not be regarded as a reasonable employer. It is sometimes said in the unfair dismissal cases that the employer does not fall within the band—I thought that the Government would use the phrase; I believe that it is the wording to which the courts would turn—of reasonable employers who could possibly do that kind of thing.

In the Wilson case in the Court of Appeal, it was agreed that the stated purpose of the employers was to end collective bargaining. But that was not enough in that case, as the noble Lord, Lord Campbell of Alloway, said. The passage was read to the Committee.

The Court of Appeal states at page 22 of the transcript that, an Industrial Tribunal is entitled to conclude robustly that an employee who has been dismissed or penalised for invoking the assistance of his or her union in relation to his or her employment has been dismissed or penalised for being a member of the union. That may not be so in all cases but certainly in an appropriate case". In other words, the Court of Appeal is delicately telling the industrial tribunals to weigh up the evidence on all sides—not in all cases, but in an appropriate case.

The contrast with the Government's structure of thought is quite remarkable. There is no question of the tribunal weighing up all the evidence. As soon as that affidavit from the employer falls on the desk of the chairman—even if one of the industrial members dissents, as is not unknown —the game is up. The affidavit from the employer cancels out the entire discrimination, penalty or whatever it may be.

The amendment provides that the tribunal should weigh up those factors and that it may say that the one action prevails over the other unless it is such as no reasonable employer would take. That is a more reasonable provision. It is primarily a question of fact to begin with: where is the purpose; what are the purposes? The amendment moves the track of the tribunal to perceive the evidence in the way that the Government demand. However, it does not take from the tribunal that final possibility of saying in a case where it wishes to do justice, "In this case at any rate the discrimination is so overbearing that we say it must cancel out the first purpose under paragraph (a)". I beg to move.

Viscount Ullswater

The noble Lord has chided me for perhaps not responding to him. He asked, "Do we ever accept any amendment? Are we going to accept any amendments today?" He has not spoken to me personally about it. However, I believe that we have to take each amendment on its merits. The Government have accepted amendments and have also responded by moving their own at Committee stage during the passage of the Bill. I therefore believe that there is evidence of good faith which I believe the noble Lord to be impugning. I rather resent the attitude that he takes. However, let us leave that on one side.

I may have misled the noble Lord when I used the phrase, perhaps inadvisedly, that there was a test of reasonableness. The words that I used sounded as though I was using a test of reasonableness when I was really referring to the words as printed in the schedule. I talked about the tribunal making up its own mind. Yes, the tribunal has to make up its own mind. It has to consider, that the action was such as no reasonable employer would take having regard to the purpose mentioned in paragraph (a)". The noble Lord kindly explained the effect of the amendment. It goes to the heart of that argument. I am afraid that although the amendment may have been presented as an eminently reasonable one, I am unpersuaded of its value. In fact I am persuaded only that the amendment would undermine all that our provision is intended to achieve.

While the new Clause I moved earlier this afternoon directed the tribunal considering a Section 146 case (where evidence of two conflicting purposes for the employer's actions is presented) to treat the negotiating purpose as the relevant purpose, this amendment would provide only that the tribunal may do so.

I am surprised, given the explanation that I gave, in moving the Government's clause, of the longstanding intentions behind the provisions concerning action short of dismissal, that this amendment has been moved. I have made it clear that what is now Section 146 was only ever intended to apply in situations where acts of individual discrimination had taken place. It was never intended to have a locus in issues related to collective bargaining.

Recent cases have shown that this intention is being undermined, as the section has been brought into play in situations where employers have sought to change their negotiating arrangements. That is why our amendment was tabled. Our amendment says, in effect, that where an employer can demonstrate that he genuinely has the purpose of changing his negotiating arrangements, Section 146 does not apply. It re-establishes the firm principle that the section does not apply to issues relating to changes in collective bargaining arrangements.

The amendment we are considering here says effectively that the section might apply, but then again it might not. It gives tribunals discretion. But, in doing so, it leaves them in no better a position than they are now to know how to decide these cases. It leaves the current confusion in law unresolved, when we have made it quite clear that our intention is to clarify the law. For all these reasons it is unacceptable, and I ask the noble Lord to withdraw it.

6 p.m.

Lord Wedderburn of Charlton

I wish to make two points to the noble Viscount. First, he often compliments my noble friends and myself on moving tiny little amendments which he then says will undermine the entire structure of the proposed legislation. There is this curious but highly clever method of moving "may" instead of "shall". If the new clause is such a curious structure that it could be undermined by changing one word for another, I hesitate to think what may happen in the real world of litigation.

The noble Viscount repeats the formula and I took account of what he said earlier. I believe that the nub of it was that Section 146 is only intended to protect individuals, not to deal with collective bargaining. That is absolutely right, we have been saying that to the Minister all the afternoon. It is exactly what the Court of Appeal says on page 22 in the Wilson and Palmer cases. However, the Minister does not seem to accept that. He casts out that paragraph from the judgment as though it were almost as bad as a paragraph (b) purpose. It can have no place. The Court of Appeal ruling must be overturned without anyone worrying about it. That is strange.

Do the Government realise what the law will look like when it is produced to a tribunal which has to deal with matters on the ground, with ordinary people's lives and employers' lives? The tribunal will see all the evidence and whoever represents the employer will be able to say, "I am sorry, you can't look at that, you can't take any account of it whatever because it relates to Section 146. The evidence must go". It is not being put to the tribunal under the terms of the Government's new clause, with the tribunal weighing it up and considering it. It is to be cast out.

Thus, the tribunal is likely to say the same as in the famous cases back in the 1960s where tribunals refused to decide matters as the statute demanded. They said that the decisions were political. It may be that the noble Viscount is jeopardising the position of tribunals in that respect because it is inserting a serious political test in the middle of industrial relations. We are now gradually seeing how far the Government wish to go. However, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord McCarthy moved Amendment No. 8:

Line 16, leave out subsection (4).

The noble Lord said: The Government make a great deal this afternoon of the word "clarity" and defend the whole new clause that we have considered on the grounds of making things clear. Then we come to subsection (4) which is the object of our amendment. We propose that the five lines in subsection (4) should be deleted, not because we are certain that they are evil or that they are contradictory, but because we cannot make sense of them.

I believe it was before the noble Viscount participated in these exchanges, but the subsection reminds me of the famous Section 228 of the Trade Union and Labour Relations (Consolidation) Act 1992 which came out of the previous legislation about separate work place ballots. At that time it used be called the "gibberish clause". This clause is like the gibberish clause and I shall read it to the Committee, not in any way to make it unclear but to try to clarify it because it is not clear to me. The subsection states: Where the action which the tribunal determines to have been the action taken against the complainant was action taken in consequence of previous action by the employer paragraph (a) of subsection (3) is satisfied if the purpose mentioned in that paragraph was the purpose of the previous action". I find that difficult. I ask the Minister: what can it mean? It could mean one of two things. The first seems reasonably peaceful and non-significant and therefore, in one of his favourite words, "unnecessary". However, the other is doubtful and perhaps dangerous: Where the action which the tribunal determines to have been the action taken against the complainant". It could be, for example, an offer of 10 per cent. if the worker would go on to individual contracts. Secondly, was the action, taken in consequence of previous action by the employer"? Was there, for example, a prior decision to move to the de-recognition of a union? Then, paragraph (a) of subsection (3)". That is to say, in a situation where, there is evidence that the employer's purpose was to further a change in his relationship with all or any class of his employees", the tribunal will be satisfied if, the purpose mentioned in that paragraph was the purpose of the previous action". That previous action was the desire to further a change in relationships by introducing individual contracts.

If the clause is to be construed in the way in which I construe it at the moment, an offer of 10 per cent. to move to an individual contract for the purpose of de-recognition is a sufficient justification of subsequent action, short of dismissal.

The problem with that is that one wonders why we have the phrase in subsection (4) about previous action, and the consequences of that previous action. If one takes a rather more worrisome view of the clause, it is not clear how previous is "previous". What exactly is "consequence"? It is possible to look at the clause and say that the employer might have taken some action in the past in relation perhaps to some other group of employees and they were being changed in order to further a change in relationship. Having done that once, the employer now cites it in order subsequently to do the same to another group of workers in quite different circumstances at an undated time in the future. We do not know which the clause means or what it means. We ask these questions for the purpose, as the Minister says, of clarification.

Lord Rochester

I must join the noble Lord, Lord McCarthy, in questioning the logic of subsection (4). I do not understand it either and I hope that the noble Viscount will be able to offer some explanation. Whether or not he can, it is not good that the Bill should leave this House in a state where the subsection remains. I do not know quite what we can do about it at this stage. I take comfort from the thought that it may be possible at Report later this afternoon to introduce an amendment which would make more sense of what the Government have in mind, apart from the merits, before the Bill goes to another place.

For the moment I content myself with saying that I support the noble Lord, Lord McCarthy, in expressing the hope that the noble Viscount will be able at least to explain in more simple terms than those of the subsection itself what on earth it means.

Viscount Ullswater

I accept that the noble Lord, Lord McCarthy, introduced this in the nature of a probing amendment and that the amendment itself would remove from the new clause subsection (4), which is a subsidiary but necessary part of it. It may be helpful if I explain what the intended effect of the subsection is. I have to say that not only did I have to read the subsection very carefully but also the amendment to make certain that I understood the purpose and wording of it. I hope that I shall be able to demonstrate to the Committee that it is required and is clear in its effect.

The first important point to bear in mind is that subsection (3) operates only where there is evidence that the employer's purpose in taking the action complained of was to further, and I stress the word "further", a change in his relationship with all or any class of his employees.

It may be best to explain the effect of subsection (4) by way of an example. Let us suppose that we have an employer who wishes to persuade his employees to give up a contractual right to collective representation or, for that matter, a contractual right to agree their terms and conditions of employment without collective representation. Let us then suppose that the employer offers a pay increase from a certain date provided his employees give up the right in question by that date.

It may turn out that the offer does not achieve its intended results because few employees accept it. If that happens, the employer may well give up any hope of achieving the change in bargaining arrangements he was hoping for. However, he is still likely, simply as a matter of good faith, to want to implement his offer to those few who did accept it.

In that situation the probability is that his purpose in not paying the increase to those who refused the offer would not be to further a change in his bargaining arrangements; rather, it would be to implement the offer he made. It would not be sensible to produce the result that, while the new clause protected the making of the offer from being found to contravene Section 146, it did not protect the consequential implementation of the offer from being found to be taken for the purpose of penalising employees who refused it from being union members. Subsection (4) removes that possibility by ensuring that, where the action complained of is consequential on previous action taken for the purposes of furthering a change in bargaining arrangements, the consequential action is also to be regarded as taken for that purpose.

I do not believe that there is any hidden mystery in this subsection. I recognise that Members of the Committee opposite are not sympathetic towards the intention of the clause as a whole. I nevertheless hope they will concede that, given the policy intentions of the new clause, subsection (4) is necessary to ensure that those intentions are realised in one particular respect. I hope my explanation has made that entirely clear. Indeed, without the subsection, the law would remain unclear in this particular respect. It is therefore consistent both with our policy intention and with our purpose of clarifying the law that it should be included. I hope that the noble Lord will see fit to withdraw the amendment.

6.15 p.m.

Lord Wedderburn of Charlton

Before the noble Viscount sits down, I am sure that we are all grateful to him for the example. Perhaps I may ask him a question relating precisely to his example. In many circles some effort has been made to try to find examples of where subsection (4) would be important. I keep to the example that he gave. If subsection (4) were not there—he says that it is needed; therefore there would be a change in his view—why would there be a change? If an employer makes an offer which might well be discriminatory under Section 146 and only some of the employees take it up, why is it not the case that, given proper evidence in the ordinary way, his purpose remains the same throughout. The tribunal would see that the purpose was there in the offer, there in the debates which he might have with any of the employees, and there in its implementation to the extent that it was accepted. Why is subsection (4) needed?

Viscount Ullswater

I believe that in the circumstances the noble Lord suggests he is probably right. However, this is a protection for the instances where the employer may be put at risk.

Lord McCarthy

The noble Viscount confused me at the beginning (indeed, he confused me at the end) because he said he had to read my amendment very carefully. With respect, my amendment is clarity itself. It just says, "Take it away". Anybody can see that. But he tells me what it means. I think I understand now what it means, but my concerns remain. They are rather different from the concerns of my noble friend Lord Wedderburn. Subsection (4) appears to say that the employer comes along and says he wants to change relationships; for example, to move to individual bargaining. That works if only 10 people want it. It works if 50 people want it. It does not make any difference. One may quote them as a particular grade. But it does not stop it working if one does not get everybody the first time. I do not see why one would not want to do it. Even if one did want to do it, the way the clause is written now one would not be allowed to do it.

On the other hand, if one wants to do something more complicated—if one does not simply want to go on to individual contracts but wants, for example, to introduce performance-related pay, or some system of systematic appraisal—one might legitimately take the view that that is no use unless the whole of that category of workers can be got to do it at the same time. It is not much good if one puts in a group bonus or a performance bonus based upon the performance of the whole group and only 10 per cent. sign up for it. I see that. But then one would not want that. One would be perfectly prepared to say to the people to whom one made the offer that the offer was contingent upon most people going along with it, and that today only 10 per cent. were going along with it so one did not want to do it. Either way I do not see that one needs this clause. If the Government want to keep it in, they might write it in a more straightforward way. On that basis, I withdraw the amendment.

Amendment No. 8, as an amendment to Amendment No. 1, by leave, withdrawn.

[Amendments Nos. 9 and 10, as amendments to Amendment No. 1, not moved.]

Lord Wedderburn of Charlton moved, as an amendment to Amendment No. 1, Amendment No. 11

Line 25, at end insert: ("(6) Subsections (3) to (5) of this section shall not come into force until one year after the date of the passing of this Act or on such earlier date by which the condition in subsection (7) is satisfied. (7) The condition is that the Secretary of State shall invite the Committee of Independent Experts of the International Labour Organisation to express their view about the compatibility of the section with the Conventions of that Organisation and shall publish their report on a date not later than one month after its receipt. (8) Nothing in this section shall affect any enactment or rule of law other than sections 146 to 151 of the 1992 Act (action short of dismissal).").

The noble Lord said: I move this amendment briefly in order that it may be put on the record. The amendment does three things. Perhaps I may begin with the proposed new subsection (8). I take it that the Government—and if this is agreed it may come back to us on Report—do not object to the notion in the new subsection (8). That notion seemed to be inherent in much that was said; namely, that the new subsection should not affect the interpretation of any sections other than Sections 146 to 151. I believe that they are the points to put in the consolidation Act.

There is one reason which makes it very important for the Government to think very hard about whether they reject this idea. Section 152 of the consolidation Act protects employees from prejudice and being discriminated against by reason of trade union membership or activities, or indeed from dismissal through being non-trade union members. I am not alone, among those who have looked at the amendment, in being very concerned and anxious about the future. It may be the next Bill; it may be the next Third Reading; who knows? That is what is so bad in the Government's posture. No one had predicted this amendment, not even those of us who take perhaps a lower view of the legislation over many years than some Members. It would be heartening to know that the Government are not, by extension of logic, about to support a probe into the area of depriving workers of their protection against unfair dismissal on the ground of being a trade union member where the argument as to what is and what is not a proper range for a trade union member in his activities is precisely the same in the case law as for action short of dismissal. If the Government say there is a gulf—they may say, "Right, indeed there is"—between action short of dismissal and dismissal, it would be heartening to know that they think that way. If they stay silent on that point or merely reject it, it may make some of us wonder whether we ought to interpret the future in that sense.

The other subsections that have been put together for convenience are different matters. Proposed subsection (6) would delay for a year the coming into force of subsections (3) to (5) of Section 148, which are the substance of the Government's amendment today. Our amendment is too humble in that respect. There are many debates and discussions which could take place during such a period. We have only put down one condition for consideration. No doubt, in view of their attitude to these matters, the Government will object. It seemed to us quite reasonable that a report on this matter by the Committee of Independent Experts of the ILO should be awaited—if it were not received within a year the matter would pass over—and its publication should be rather more widespread than perhaps is now contemplated. As the Committee has heard, we are making progress through the various libraries, in this country at any rate.

So there are three different points: the confinement of the new law to Section 146; the stay of execution for a year for proper consideration; and during that year a debate to determine just where the standard should be drawn by reference inter alia to a report of the ILO Committee of Independent Experts. I beg to move.

Viscount Ullswater

I fear that I may repeat myself but I have to reiterate my assurance that the Government are fully committed to their obligations, which arise from international treaties including those of ratified ILO conventions. The noble Lord must know that no UK Government have ever felt it necessary to seek the ILO Committee of Experts' views before bringing into operation legislation which they believe to be entirely compatible with ratified conventions. I hope that he will accept that as our position, even if he does not share our analysis.

I understand the nature of what the noble Lord says. We have discussed it on a previous amendment. I do not seek to say more than that about the matter. However, I should like to address the point that he made at the beginning of his remarks. I can assure him that there is no question of the provisions of the new clause affecting any enactment or rule of law other than the appropriate parts of statutory employment protection legislation. To state that, as the third subsection of the amendment would do, is therefore quite unnecessary. To imply that there could be some such effect in the absence of that subsection would be quite wrong. Indeed, to accept that element of the amendment could cast doubt on the way in which provisions without a similar disclaimer could possibly apply, and that is clearly undesirable.

The noble Lord demonstrated his conception of how certain international treaty obligations might be applied in this country. However, as I explained not only in this debate but on previous occasions, he proposes systems which we believe are neither appropriate nor practical and which even he must recognise would be highly novel. I hope, therefore, that he will agree to withdraw his amendment.

Earl Russell

Before the noble Viscount sits down I should like to ask him one question. I accept what he said about the intention to accept our international obligations. Were he to find that he was mistaken and the Government were pronounced by the competent authority to be in breach of one of our international obligations, would the Government repeal this amendment if it were on the statute book?

Viscount Ullswater

We respond to every recommendation of the committee of experts to the United Kingdom Government. I indicated in the last instance that, where the law was found to be outside the international standards, it was altered.

Lord Wedderburn of Charlton

I hear what the Minister says. We debate this matter often enough but I cannot promise that we shall not press him again on this matter. International standards are important. In our view the Government take their pick. They see a nice decision from the European Court of Human Rights in the case of the railwaymen. They pick it out and back it. But when year after year (for five years now) they see decisions of the Committee of Independent Experts—which is the relevant authority, together with the Committee on Freedom of Association, which takes the same view as the ILO (and I remind the Committee that it is a tripartite organisation and the only world-wide tripartite organisation to deal with employment matters as an agency of the United Nations)—they do not respond but simply say that it is wrong. Year after year they have told the committee that it is wrong and year after year the committee has told them that they are wrong. That is not the way to carry on if you believe in international standards.

However, I see that we have committed our usual fault in our poor amendments: either that they are undesirable or unnecessary. Half of this amendment, as the noble Viscount said, is undesirable, and the other half he considers unnecessary. Sometimes I feel that perhaps he should flag up which of those labels he will use and use a set of red, green or yellow cards so that we would know which way to point in terms of the argument.

The last part of our amendment is important. From what the noble Viscount said, I take it that the Government have no intention of extending that line of argument to dismissal. If that holds sway, it would be very welcome indeed. It would be worth hearing on this amendment. I beg leave to withdraw the amendment.

Amendment to the amendment, by leave, withdrawn.

The Deputy Chairman (Baroness Serota)

The Question is that Amendment No. 1 be agreed to.

Baroness Turner of Camden

We have been unable this afternoon to effect any improvements in this clause introduced so late in the proceedings by the Minister. As we said, the new clause seeks to give support to legitimise what we believe to be the maverick decision of the Employment Appeal Tribunal in two cases: Associated Newspapers Ltd. v. Wilson and Associated British Ports v. Palmer.

The Minister has not persuaded me this afternoon that there is a pressing need for the introduction of the amendment. I do not believe that clarification is needed. The Court of Appeal decisions were not only in accordance with previous precedents. Had the court decided otherwise it would in my view have been a breach of the existing law. The decisions that the court made were in line both with Section 146 of the 1992 Act and the conventions that this Government themselves have ratified.

As we have repeatedly said, there has been no consultation with interested parties. Although we have managed to have Committee and Report stages, this legislation is all being crammed into the same day on which we are having Third Reading. There has not been time for effective parliamentary scrutiny, as the noble Lord, Lord Campbell of Alloway, pointed out. However, we have done our best in the time available to us.

It is our belief that the law should not allow employers to impose financial penalties on individual employees who wish to retain the right to be represented by their union. That is the crux of the matter and it is what this debate is all about. That is hardly strengthening the rights of individuals. In fact, it is yet another employment right that will have been taken away if this clause reaches the statute book.

The Government continue to argue that there is a difference between the right to belong to a union and the right to have that union negotiate on behalf of its members. Yet, as everyone knows, the major reason for joining a union is to have terms and conditions of employment negotiated on behalf of the individual and the group. Once that right is taken away there is every prospect that the union will "wither on the vine", as the dissenting member at the EAT correctly said. So it is disingenuous to argue that the clause is not directed against trade union membership. Clearly it is. It will give employers the loophole for which they are looking to get out of obligations imposed by Section 146 of the 1992 Act, obligations which have been in existence since 1975. I repeat that these are obligations to individuals.

The ILO Convention 98 (General Principles), Protection Against Anti-Union Discrimination, clearly states, Legislation should lay down explicitly remedies and penalties against acts of anti-union discrimination by employers against workers' organisations in order to ensure the effective application of Article 1 of the Convention … Protection against acts of anti-union discrimination should cover not only hiring and dismissal, but also any discriminatory measures during employment, in particular transfers, downgradings and other acts that are prejudicial to the worker … Furthermore: No person should be prejudiced in his employment by reason of his membership of a trade union, even if that trade union is not recognised by the employer as representing the majority of workers concerned". It would be difficult to find a more discriminatory act or one more likely to deter an employee from belonging to a union than the provision of extra money in return for giving up the right to trade union representation or, in the Daily Mail case, the withholding of an anticipated increase in pay from Mr. Wilson because of his failure to sign away that right to trade union representation. There is no doubt that both the employers involved in the two cases wanted to bring to an end the arrangement that they had had for many years—in the case of the Daily Mail since 1912—under which they had negotiated terms and conditions of employment with independent unions representing their workforces. However, it had its effect on individuals when the employers attempted to bribe the individuals to abandon rights to trade union representation that they had had for many years.

I understand that if the clause becomes part of the Act, it will not be implemented retrospectively. The Minister confirmed that during the debate and I thank him for that assurance. But there will be a clear signal to employers that, if they should attempt to do what those two employers did, they can expect to get away with it. That is entirely unacceptable. For those reasons I oppose the clause.

6.30 p.m.

Lord Rochester

I shall detain the Committee for only a few moments. In response to my speech on Amendment No. 2, the noble Viscount rightly said that I had spoken rather broadly to it. Indeed I did. In fact, at that time I spoke more in opposition to the government amendment than in support of the amendment moved by the noble Baroness, Lady Turner.

We remain of the opinion that both in the manner in which it was introduced and in its substance Amendment No. 1 is unacceptable. It is unacceptable in substance for the reasons that I gave earlier. I shall therefore say no more than that we find ourselves in strong opposition to it and shall certainly vote against it when the Question is put to the Committee.

Lord Wedderburn of Charlton

Perhaps I may add one word to my noble friend's case against the clause. The debate has clearly shown what the Government are about. It has shown that there was no uncertainty in the judgments of the Court of Appeal. Indeed, if it showed anything it showed that: no uncertainty at all. It showed that the Government did not like the Court of Appeal judgments; that they are legislating with no concentration and with great speed against a specific judgment. But it showed even more than that.

Recently economic conditions have begun to change; there has been a greater sense that those who feel oppressed are striking back or defending themselves as individuals by collective action in the workplace. It is therefore no accident that this step has been taken so hurriedly at a time of change in the social and economic cycle. Indeed, a letter from the Secretary of State to the Graphical, Paper and Media Union on 11 th May stated: The nature of the employment relationship is that an employer offers work, and an employee undertakes to do that work in accordance with the terms offered by the employer". We have had it again today—no negotiation, no talk of discussion. The employer's will must prevail as soon as he can swear the necessary affidavit. If Members of the Committee do not vote against the amendment, it will be a sad day.

Viscount Ullswater

I should like to reiterate briefly the reasons for tabling the amendment. It has always been the understanding of the Government that the law contained in Section 146 of the Trade Union and Labour Relations (Consolidation) Act existed to protect individual employees from acts of victimisation by their employer on the grounds of their union membership or non-membership. The intention was never that the section should prevent employers from making and implementing entirely legitimate decisions about how they negotiate with their workforce.

As I have already made clear, that understanding was shared by successive administrations of different political persuasions. It is certainly not new. When it became apparent from the recent Court of Appeal cases that our understanding was not being borne out by the judgments in the courts and that the law was therefore in a state of some confusion, it was clear that it was the duty of the Government to act and to remedy that confusion. That is what the new clause does.

We have had a vigorous debate, not only on the new clause, but also on the amendments to it tabled by Members opposite. I hope that I have been able to offer reassurance on many of the issues highlighted. Our debates this afternoon have tended to focus on situations where an employer de-recognises a trade union, because that is the situation that gave rise to the recent Court of Appeal cases. However, I remind the Committee that our amendment protects the actions of an employer when he acts reasonably to further any changes in his relationships with his employees. The provision, therefore, could apply not only where the employer seeks to de-recognise a union, but also where he seeks to move towards recognition, perhaps because he has decided to introduce a single union deal and wants to encourage his employees to sign new contracts of employment. The provision is entirely even-handed.

Anxiety has also been expressed in regard to the late stage at which the new clause has been tabled. I explained to the Committee that the timing of the amendment was determined by the Court of Appeal cases, which demonstrated the need for clarification of this area of law. I further remind the Committee that this afternoon will not be the only occasion on which the provisions will be debated. When deliberations in your Lordships' Chamber are complete, the Bill will pass to another place, where these important matters will be debated in full again.

The issue that we have debated, and shall continue to debate, is an important one. The Government's new clause will provide much needed guidance for courts and tribunals. I commend it to the Committee.

Lord McCarthy

Before the Minister sits down, the noble Viscount told us that he would not have anything to do with this kind of clause extending to dismissal. How far will it extend? Suppose an employer used the clause to refuse to promote a trade unionist; suppose he downgraded an employee; suppose he excluded an employee from a profit bonus; suppose he put all the trade unionists who would not sign to come out of the collective agreement on night work and shift work; would all that be permissible?

Viscount Ullswater

That is for the tribunal to decide, given the evidence. What we have been discussing all afternoon is what a reasonable employer would seek to do. I do not know the circumstances of all the cases mentioned by the noble Lord. It is for the tribunal to come to a comprehensive and satisfactory judgment given the indications that new amendments insert into Clause 146.

6.39 p.m.

On Question, Whether the said amendment (No. 1) shall be agreed to?

Their Lordships divided: Contents, 115; Not-Contents, 76.

Division No. 2
CONTENTS
Aberdare, L.	Cross, V.
Allenby of Megiddo, V.	Cumberlege, B.
Arran, E.	Davidson, V.
Astor, V.	Denham, L.
Astor of Hever, L.	Denton of Wakefield, B.
Belstead, L.	Elles, B.
Blake, L.	Elliot of Harwood, B.
Blatch, B.	Elliott of Morpeth, L.
Blyth, L.	Erroll, E.
Borthwick, L.	Faithfull, B.
Boyd-Carpenter, L.	Ferrers, E.
Brabazon of Tara, L.	Fraser of Carmyllie, L.
Braine of Wheatley, L.	Gainsborough, E.
Bridgeman, V.	Gardner of Parkes, B.
Brookeborough, V.	Goschen, V.
Brougham and Vaux, L.	Granard, E.
Buxton of Alsa, L.	Haig, E.
Cadman, L.	Hailsham of Saint Marylebone, L.
Caithness, E.	L
Campbell of Alloway, L.	Harlech, L.
Campbell of Croy, L.	Harmar-Nicholls, L.
Carnegy of Lour, B.	Harmsworth, L
Carnock, L.	Haslam, L.
Chelmsford, V.	Hayhoe, L.
Clanwilliam, E.	Hemphill, L.
Clark of Kempston, L	Henley, L.
Cochrane of Cults, L.	Hesketh, L. [Teller.]
Colnbrook, L.	Holderness, L.
Colwyn, L.	HolmPatrick, L.
Constantine of Stanmore, L.	Hood, V.
Craigavon, V.	Howe, E.
Craigmyle, L.	Kitchener, E.
Cranborne, V.	Lane of Horsell, L
Crickhowell, L.	Liverpool, Bp.

Long, V.	Ridley, V.
McColl of Dulwich, L.	Rodger of Earlsferry, L.
Mackay of Ardbrecknish, L.	Russell of Liverpool, L.
Mackay of Clashfern, L.[Lord Chancellor.]	St. Davids, V.
	Saltoun of Abernethy, Ly.
Macleod of Borve, B.	Seccombe, B.
Merrivale, L.	Selborne, E.
Mersey, V.	Shannon, E.
Mottistone, L.	Stewartby, L.
Mountevans, L.	Strathclyde, L.
Mowbray and Stourton, L.	Strathmore and Kinghorne, E.
Murton of Lindisfarne, L. [Teller.]
Napier and Ettrick, L.	Sudeley, L.
Norrie, L.	Thomas of Gwydir, L.
Onslow, E.	Thurlow, L.
Orkney, E.	Ullswater, V.
Park of Monmouth, B.	Vaux of Harrowden, L.
Parkinson, L.	Vivian, L.
Pearson of Rannoch, L.	Wakeham, L. [Lord Privy Seal.]
Pender, L.
Peyton of Yeovil, L.	Wharton, B.
Prior, L.	Whitelaw, V.
Rankeillour, L.	Wise, L.
Reay, L.	Wynford, L.
Renton, L.	Young, B.
Renwick, L.
NOT-CONTENTS
Ackner, L.	Jenkins of Putney, L.
Archer of Sandwell, L.	Kilbracken, L.
Ardwick, L.	Kirkhill, L.
Attlee, E.	Listowel, E.
Birk, B.	Llewelyn-Davies of Hastoe, B.
Blackstone, B.	Lockwood, B.
Bonham-Carter, L.	McCarthy, L.
Brooks of Tremorfa, L.	McIntosh of Haringey, L.
Carmichael of Kelvingrove, L.	Mallalieu, B.
Cledwyn of Penrhos, L.	Mason of Barnsley, L.
Clinton-Davis, L.	Merlyn-Rees, L.
Dacre of Glanton, L.	Molloy, L.
David, B.	Moyne, L.
Dean of Beswick, L.	Murray of Epping Forest, L.
Desai, L.	Nicol, B.
Donoughue, L.	Ogmore, L.
Dormand of Easington, L.	Perry of Walton, L.
Eatwell, L.	Peston, L.
Fisher of Rednal, B.	Pitt of Hampstead, L.
Fitt, L.	Rea, L.
Gallacher, L.	Richard, L.
Galpern, L.	Rochester, L.
Gilmour of Craigmillar, L.	Russell, E.
Gladwyn, L.	Sefton of Garston, L.
Glasgow, E.	Serota, B.
Graham of Edmonton, L.[Teller.]	Soper, L.
	Stedman, B.
Greene of Harrow Weald, L.	Stoddart of Swindon, L.
Grey, E.	Taylor of Blackburn, L.
Harris of Greenwich, L.	Taylor of Gryfe, L.
Henderson of Brompton, L.	Tordoff, L.
Hilton of Eggardon, B.	Turner of Camden, B.
Hollis of Heigham, B.	Wedderburn of Charlton, L.
Hooson, L.	Whaddon, L.
Houghton of Sowerby, L.	White, B.
Howie of Troon, L.	Williams of Elvel, L.
Jay of Paddington, B.	Williams of Mostyn, L.
Jeger, B.	Winchilsea and Nottingham, E.
Jenkins of Hillhead, L.

On Question, amendment agreed to.

Resolved in the affirmative, and amendment agreed to accordingly.

House resumed: Bill reported with an amendment.