My Lords, I chaired the Joint Committee, and we produced a report that mentioned Clause 2 only at the end, in the paragraph on “Wider concerns”. However, that report was published a year ago and things have moved on a little. What I would ask noble Lords to think about while we consider this
clause on employment tribunals is: who does it affect? It affects only employers who have broken the law. I repeat: it affects only employers who have broken the law. So this is a completely different debate to the one we have just had on Clause 1. We have a specific target—those employers who have broken discrimination law. They are the only people affected by Clause 2. We therefore ought to look at it in that context.
We had a lot of evidence on Clause 2. I did not count the amount of time that was spent on it, but it was less than on some of the other issues. We noted the wider concern from opposing forces, if you like, at paragraph 190 of the report. There was an absence of evidence in favour of the clause from some groups, whereas the other side claimed the power in the clause had rarely been used since being enacted three years ago and that therefore it should go. I do not think rare use is an excuse or should be used as a reason of itself to abolish a power that was put in by Parliament only three years ago. That reason is not sufficient. Not many companies have been affected by it. In their response to the Joint Committee’s report, the Government said, at paragraph 103:
“around 28 Tribunal cases have been given wider recommendations”.
The emerging pattern was that 70% of the recommendations focused around training and management. It is unlikely that that pattern is going to change.
The Government’s response was published in January this year—a long time ago now. However, in order to assess the effectiveness of the power, the Government Equalities Office, which I think is buried deep in the Home Office, wrote in autumn 2013 to 27 of the lawbreaking employers who had received wider recommendations at that point. The Government Equalities Office asked whether those employers had taken forward those recommendations and how much it had cost them to do so. Eight bothered to reply, six from private and civil sector employers. The Government’s response states that:
“All the employers who responded had implemented the wider recommendation”—
that is, those lawbreaking employers found the extra recommendations quite useful to prevent further discrimination, which would cause them more problems if they were found guilty of discrimination again. They had taken the sensible course of doing something about the wider recommendations, at an average cost to business of around £2,000.
The Government Equalities Office—bless it—obviously thought that was sufficient. It could not even be bothered to chase up those who did not answer. That beggars belief: it did not bother to chase up those other 19 lawbreaking employers that could not be bothered to tell us what they had done. Thank heaven, therefore, for the Equality and Human Rights Commission. This is the central point that I want to make. I want to ask the Minister to take this away and think about it again. I freely admit that there is a justified case either way, but my view is that the decision here ought to be based on the evidence. The Joint Committee published its evidence by 16 December last year, as required by Parliament. The Government responded in January and the Bill has been through the other place.
However, the Equality and Human Rights Commission decided—bless it—to have a look at what had happened since the Government’s report was published, after it had already given evidence to the Joint Committee. It has gone away and had a look. It reviewed more than 400 employment tribunal judgments received from the employment tribunal between December 2012 and September 2014—note that: September 2014—long after the Government’s response to the Joint Committee.
I shall not go through the whole EHRC report, which many noble Lords will have received, but the criticisms of the wider recommendations power, as expressed by government and business, can be summarised as follows. One criticism was: “They impose a burden”—I think that is very polite—“on employers” who have broken the law. I repeat: all the employers affected have broken the law; they have all been found guilty of discrimination.
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Another criticism was:
“The power is little used”.
Well, there is a bit of an issue regarding the power being little used. As I understand it, having looked at the EHRC’s note,
“16 per cent of claimants in discrimination claims were still working for the employer against whom they made their claim”.
That means that 84% never get the chance to benefit from the wider recommendations because they are no longer with their employer. There is a bit of a mismatch there.
However, the main point is covered in the EHRC’s conclusion. The example that the Equality and Human Rights Commission gives us is a comparison with the equal pay breach. I fully accept that this clause does not apply to discrimination involving equal pay breaches, but the commission’s report refers to the Government’s statement that in such cases:
“Employers will be required to fully consider their pay policies and structures”—
that is, after someone had been found guilty of discrimination—
“and draw up an action plan to rectify any discriminatory pay differences that may exist. This will result in fewer future breaches and will consequently reduce the number of equal pay claims brought against employers”.
That is exactly the rationale that should be applied to other discrimination cases. Basically, all we are asking with regard to the wider recommendations is that these lawbreaking employers should be protected from themselves by encouraging them, when it is appropriate to do so, to go wider than the individual who has won a case for discrimination.
I shall not go through the whole of the commission’s report, but at the end it recommends:
“The power to make wider recommendations is an effective way of preventing unlawful discrimination from occurring and helping employers to comply with their duties to treat their employees fairly”.
These are employers who have broken the law—let us make that absolutely clear. We are trying to help so that this situation does not happen again. We are helping both the employers and the employees. The commission concludes:
“The case for its abolition has not been made”.
The Minister is not in charge of this Bill; Oliver Letwin is, and they are as different as chalk and cheese. Let us be clear about that, so that we know what we are talking about. We are talking to Oliver and we say to him, “What we really want you to do is to think about this again, because you are protecting and giving an easy ride to lawbreaking employers with this clause”.
As I said at Second Reading, I agree with the thrust of the Bill; I do not have a problem with a great deal of it and I support what the Government are trying to do. However, since the Joint Committee reported and the Government produced their response to the Joint Committee, some fresh evidence and thinking has come from the Equality and Human Rights Commission. It is far more up to date than what the Government did through the Government Equalities Office and the Home Office. That was trivial—they never chased anybody up. So we have some fresh and better evidence that shows that it might be a mistake to enact this clause.
I am asking the Minister to think about this following the debate. I ask him to go back and talk to Oliver and say, “I think we ought to have another think about this on the basis of the evidence that we’ve now got but which we didn’t have when we, the Government, responded to the Joint Committee”. I end by expressing my opposition to the clause standing part of the Bill.