Employment Bill [HL]

My Lords, I welcome the opportunity to contribute to an important debate on an important Bill. I was slightly disappointed to hear the noble Lord, Lord Hunt, say that the Bill has little to say about, and will have no effect on, job creation. That may not be its direct effect but job creation is not meant to be what it is about. It is important to see it for what it is—a necessary tidying-up exercise. Many noble Lords referred to the number of employment Acts introduced over the past 10 or, indeed, 20 years. I do not think that is important. If legislation is necessary to improve employment law, it should be brought forward. The fact that it is often so necessary may be regrettable, but that is a separate issue. So long as we are improving the law, I see nothing wrong with introducing legislation and I do not think that anybody today has suggested that this Bill will not improve the situation in a number of respects. We should regard this Bill as, rather than being concerned with job creation, addressing the needs of those who already have a job and are entitled to be treated fairly in all aspects of their employment. I think that everyone has accepted that the 2004 regulations were not a success in practice in resolving disputes. The Government have maintained their commitment to review them. As we have heard often today, that has been done and now we look to move forward. Those who had to use the regulations often reported that they were too complex and too unwieldy, so their demise through this Bill is welcome. In some cases the regulations acted as a barrier to justice for employees in non-unionised workplaces. That remains an issue, although it has not received much consideration today. How will people without access to representation appear before an employment tribunal, should that be necessary? In principle, there is no barrier to their doing so but, in practice, the barrier is there and is sufficiently daunting to dissuade all but the most determined and, it has to be said, financially secure from proceeding. As a former employee of a trade union, of which three other former employees are represented on these Benches in this debate, I had considerable involvement with industrial tribunals, as they were then called. In those days, it was customary for an individual in a unionised workplace to be represented by his or her union official and for the employer to be represented by the head of personnel, as human resources departments were called in those days. The situation has changed and it is has become increasingly a legal battlefield, which I think is unfortunate. Indeed, my own union, which is now known as Unite, has resorted to having lawyers represent members in many cases rather than its own paid, full-time officials. I think that that is a shame, not just because I very much enjoyed the tribunals but because it has made it more daunting for individual members to pursue them—the question of cost is always there and the outcome is also less than certain, even when they win, as I shall illustrate in a few moments. That brings me to a nub of the issue, which is slightly between the lines of this legislation: the question of unpaid employment tribunal awards. My noble friend Lady Gibson of Market Rasen and the noble Lord, Lord Razzall, mentioned this point. We do not have any official figures on how many cases occur where an award is made but is not paid by the employer. It is difficult to take that matter forward because many successful applicants are unwilling or, indeed, unable to take the matter up with their employer or, as is almost always the case by that time, their ex-employer. Employers who do not pay out are simply irresponsible and that behaviour cannot be acceptable in any situation. Citizens Advice has provided a briefing for this debate. I want to dip into it a little because it contains interesting and important information. The briefing states: "““The Bill contains no measures to make it easier for successful claimants to enforce employment tribunal awards made in their favour””." The research by Citizens Advice and its paper published in 2004 show that at least one in 20 awards made by an employment tribunal is simply not paid by the employer. The tribunals have no powers to enforce such unpaid awards. Instead, if the employer has not paid the award within six weeks, the successful claimant must enforce the award through the civil courts. Not surprisingly, most do not. I refer to the Citizens Advice figures, which provide clear evidence as to why they do not. The range of fees involved include £45 for obtaining information from the debtor about their assets, which may be needed to help to decide how to enforce the debt, between £55 and £95 to issue a warrant of execution involving bailiffs possessing assets for sale to pay debts, £55 to take out a charging order on a debtor’s assets or property, £55 to order a third party, such as a bank or building society with access to the debtor’s funds, to pay the debt directly, and £190 to declare a company bankrupt as a means of recovering the debt. This concerns action that is required to be taken and funds that are required to be spent by someone who has won their case; they have already won and are now being asked to win it again. To me that sounds remarkably like double jeopardy and it is completely inappropriate that anyone should consider that to be acceptable. We have an opportunity to legislate and this loophole should be closed. In his opening remarks, the Minister mentioned that some £9.6 million had been identified in respect of arrears of the national minimum wage, that 14,000 people had benefited through the various means provided by the Government and that £3 million had been recovered. However, a considerable amount remains outstanding. In its briefing for this debate, the British Chambers of Commerce says that a failure by any employer to pay wages in line with national minimum wage regulations is an anti-competitive practice that impacts negatively on the vast majority of fully compliant firms. I thoroughly agree with that; I do not think that anyone could disagree. However, if that is the case, why should there be a laissez-faire attitude to employers who refuse to comply with an employment tribunal award? Why should the onus to win fall again on the applicant who has already won? That is unjust and I invite the Minister to say in his summing up why no such provision is in the Bill. I hope that a suitable amendment will emerge in Committee to ensure that winning a case at an employment tribunal brings with it the award decided on after all the facts have been heard by that tribunal. I turn now to the question of employment agency workers and enforcement. It is said that there are some 1.5 million agency workers in the UK. They are often the most vulnerable employees and it is the understanding of most people that the powers of the Employment Agency Standards Inspectorate are less than adequate to deal with the extent of the exploitation that many agency workers face. It is often said that rogue employers and, indeed, employment agencies have too much flexibility in the treatment of employees, especially migrant workers. Many examples exist of permanent workers working side by side with agency workers who do the same work and hours for radically different pay, conditions, holidays, pensions and so on. That is unacceptable. Of course agency work is acceptable for some people. It may fit family circumstances or other aspects—perhaps the workers are partly retired and in receipt of a pension. Of course there are circumstances where that is suitable; if the individual is happy with that, that is fine. However, many individuals are not happy with it and we have to legislate with them in mind. I repeat the comments of my noble friend Lord Hoyle and many others that it is unfortunate that the recent Lisbon process was unable to reach a conclusion on equal rights for agency workers. However, the Government will soon have an opportunity to resolve the matter at a domestic level because, as my noble friend Lady Turner of Camden said, a Private Member’s Bill is to be put forward in another place by Andrew Miller, the Member for Ellesmere Port and Neston. He has at least something in common with me; he may not think that he has much in common, but we started our work for a union that was, back in 1977, called the Association of Scientific, Technical and Managerial Staff. It has gone through three name changes since then. He is at one end of the corridor and I am at the other, but I certainly support what he is attempting to do in his Private Member’s Bill, which comes to the House of Commons next month. I very much hope that the Government will see what they can do to speed up the progress of that Bill. Opponents will say that it could cost jobs, lessen flexibility and cause harm in various ways, but I seem to remember that the same arguments were advanced 10 or 11 years ago when the national minimum wage was first proposed—and, of course, employment has risen in that period. Not too much time needs to be spent listening to the scaremongers. There are positive reasons for doing what is suggested in Mr Miller’s Bill and I hope that it will have the necessary support. The strengthening of penalties for offences by employment agencies under the 1973 Act is to be welcomed, particularly the opportunity for cases to be heard in a Crown Court where there is no limit on the fine that can be imposed. There is also a proposal to increase the fines that can be imposed by magistrates’ courts to a statutory maximum of £5,000. I should point out to noble Lords who are not aware of it that last month the maximum figure in Scottish courts was increased to twice that amount. I hope that the Government will consider following suit at a suitable time in the not-too-distant future, because the potential increase could be a considerable deterrent for errant employers. The doubling of the enforcement budget of Her Majesty’s Revenue and Customs during the next three years and the increased penalties provided for in the Bill are also welcome and will help, but not by as much as an extension of employment rights for agency workers would. I shall finish there. Like other noble Lords, I look forward to participating in the debates that will follow in the Committee stage of this important piece of legislation.