Employment Bill [HL]

My Lords, my noble friend Lady Miller does not squeak. I have never heard her do so; she would have been quite firm. I am relieved that the Government have seen sense and followed the review’s advice to repeal those provisions. Of course, that raises the question of what they will replace them with, and I look forward to hearing about the Government’s plans in this area in more detail. I am also interested in finding out a little more about the Government’s thinking on the next clauses. The Government must make a proper case for these new powers and offences and should be able to produce evidence to show that they are needed. The Government’s arguments for increasing the penalty for non-compliance with the national minimum wage hinge on the current lack of a significant punishment for the offending employer. Apparently, last year only two cases led to a penalty notice; all other cases were resolved with no negative impact on the employer. These provisions therefore increase the deterrent effect by making it more likely that an employer who breaks the law will be punished. However, I was assured that the new penalty will fall only on the most egregious 5 to 10 per cent of cases and that the Government believe that the huge majority will continue to be resolved by civil procedure. Can the Minister explain how this new penalty, to be applied to only a tiny minority of cases, will be more of a deterrent than the rarely applied penalty notice currently allowable? Is there a problem with employers being repeatedly accused of underpayment under the current system? If so, why is the penalty notice not used more widely? Can the Minister really be sure that these measures are the most efficient way to help vulnerable workers? What is the expected cost of these new powers and enforcement measures? It is sinister that these provisions are appearing some months before the Trades Union Congress Commission on Vulnerable Employment is due to report. Perhaps the noble Lord, Lord Jones of Birmingham, whose opinion of Labour’s cosy relationship with the trades unions is well known, has prevailed on the Prime Minister to get in early, but would it not be sensible for the Government to look at all suggestions in this area before proceeding with further regulation? Are they not just continuing the tweaking of employment law that business finds so costly and confusing? Finally, on Clause 17, the question of trades unions and their relationship with the Government has frequently led to strong disagreement and I hope that we will be able to maintain a constructive note during the Bill’s proceedings. As an employer, I was always acutely aware that for a successful business employers and employees need to have mutual trust and that a trade union can be a powerful way of helping to establish that. I hope that the Labour Party will take care that it does not do anything to destroy that trust. I see that there are noble Lords with strong connections to trades unions on the speakers list and I look forward to hearing their contributions to this debate. On these Benches, we have severe reservations that this clause is gold-plating. I feel that it can only increase the perception that the Government are in hock to the unions to an extraordinary degree. The Minister must agree with me, for only two years ago he warned that the financial relationship between Labour and the unions led to a conflict of interest in the Government’s dealings with what he called a vested interest group in society. On these Benches, we have always resisted the idea that the special relationship between Labour and the unions is beneficial for the unions or the Labour Party; it is certainly not beneficial for the country. From this Government’s complete surrender over public sector pensions, their refusal to address the serious issues raised by the political levy and their continuing claim that they, and they only, represent the working population of this country, it appears that they too often give in to the temptation of short-term opportunism when dealing with the unions rather than seeking the long-term good health of this country’s economy. In this House—and across the board—Clause 17 raises several specific concerns. In the clause, there is a large potential for abuse, as the government consultation document itself acknowledges. Membership of the BNP is not illegal, however much we might all deplore its policies. Secondly, the clause opens up difficult questions on where the line should be drawn in future. Will membership of controversial political organisations, such as Greenpeace, or some of the more extreme animal rights groups, be grounds for expulsion in future? Thirdly, how far do the Government envisage allowing trade unions to go to establish political membership? Will only current or former card-carrying members be expellable? What if a member has made significant financial contributions to or has worked for a party that is disapproved of? The questions seem to be endless. The clause represents the top of a very slippery slope. I will certainly be raising my concerns again as the Bill moves through the House and I hope that the Minister will listen carefully to both me and your Lordships, who, I am sure, will also have much to say on this matter and much experience to bring. Perhaps that is why the Prime Minister has decided that this Bill should start in your Lordships’ House, so that we can discuss in detail all its shortcomings. In conclusion, the Bill is disappointing. It gets off to a good start with some very welcome provisions, but it goes rapidly downhill. I look forward to hearing your Lordships’ views and to hearing the closing remarks of the noble Lord, Lord Bach, on it. He is a most experienced Minister and I am sure that the noble Lord, Lord Jones, will be as interested as I am to hear what the Labour Party has to say in reply to this Second Reading of the Bill.