§ 21. Mr. Bennett
To ask the Secretary of State for Employment if she will make a statement about implementation of the EC directive on acquired rights.
§ Mr. Michael Forsyth
The directive was implemented by the Transfer of Undertakings (Protection of Employment) Regulations 1981. The Government doubt whether the directive is compatible with the principles of subsidiarity and it will certainly be among those directives which the Government will continue to question as the subsidiarity exercise develops. In addition, the Government will press in any negotiations for the revision of the directive to make it absolutely clear that the directive does not cover the contracting out of services where no business is transferred.
As long as the directive remains in force, however, the Government must ensure that United Kingdom law implements it fully. Clause 26 of the Trade Union Reform and Employment Rights Bill, now in Committee, makes some minor amendments to the regulations to ensure this. These amendments do not change the fact that the regulations apply only if an undertaking is transferred as a going concern. This has always been, and will continue to be, the test of whether or not the regulations apply.