Unpaid Trial Work Periods (Prohibition) Bill
Friday 16th March 2018
(6 years, 9 months ago)
Commons ChamberUnpaid Trial Work Periods (Prohibition) Bill 2017-19 View all Unpaid Trial Work Periods (Prohibition) Bill 2017-19 Debates Read Hansard Text Read Debate Ministerial Extracts
Stewart Malcolm McDonald (Glasgow South) (SNP)
I beg to move, That the Bill be now read a Second time.
I wish to begin by thanking all the hon. Members who sponsored the Bill at its outset. I also thank the many organisations and people—the Scottish Trades Union Congress, the Better than Zero campaign, Thompsons Solicitors, Jolyon Maugham, QC, and various others—who have taken the time to support its drafting. I would like to mention one person above all others, if you will indulge me, Mr Deputy Speaker, and that is my magnificent researcher Keith Thomson. He has pulled a shift and a half—a paid shift and a half—to ensure that the Bill made it to the Floor of the House this afternoon.
Right hon. and hon. Members will know that the Bill enjoys support from all the parties in this House, with the exception of the Democratic Unionist party, but I do not wish to dwell on that lowly fact at the moment; unfortunately, my overdraft did not extend to that which Her Majesty’s Treasury enjoys. Right hon. and hon. Members will also know that yesterday the polling company YouGov published a poll showing that 65% of the public believe that unpaid trial work is unfair; a clear majority of people across the UK are looking for this Parliament to do what it has to do in correcting the law as it currently stands. That is the opportunity that sits before us. [Interruption.] Did the hon. Member for Mid Worcestershire (Nigel Huddleston) wish to say something? It is unlike him—
Wes Streeting
I congratulate the hon. Gentleman on introducing this Bill. Time is short, and we know how Friday shenanigans can sometimes work. Given the high level of public and cross-party support, it is incumbent on the Government and, in particular, Conservative Back Benchers, to make sure that this Bill passes its Second Reading before we adjourn.
Stewart Malcolm McDonald
The hon. Gentleman knows, as do Conservative Members, that I wish to be a constructive voice in this Parliament while I am here. I think this is a good Bill. Some people may see it as not a perfect one, which is why it should go to Committee, so that we can make good law. If we are not here as legislators to make good law, what on earth is the point of this Parliament? Although my political career rests on that question, while I am here I would like to make some use of the time and so I agree with what he has to say. With support from Members from across the Benches and with great support enjoyed among the public, we should give the Bill a Second Reading.
I wish to adumbrate for Members why I believe, as do so many others, that the law needs to be changed. As I understand it, the Government’s view is that unpaid trial shifts are already unlawful and that such practices are covered by the National Minimum Wage Act 1998. It is 20 years old this year and undoubtedly a fine piece of legislation, but it is insufficient when it comes to dealing with unpaid trial shifts, although I do not think it was meant to be. We have the opportunity to put it right.
In 20 years of the 1998 Act, there has not been a single tribunal or a single fine issued. There has not been a single prosecution, naming and shaming or ticking off of anyone for the use of an unpaid trial shift. That feeds into the fact that the Government, the courts and the trade unions do not hold any statistics on unpaid trial shifts. Nevertheless, we all know that they happen.
Bob Stewart (Beckenham) (Con)
I think I support the Bill, but will the hon. Gentleman clarify that it will apply only to an unpaid trial for a job, and not to an unpaid sixth-former helping in a Member’s office for a while?
Stewart Malcolm McDonald
Every sixth-former should have the chance to do work experience in the hon. Gentleman’s office and I would not dream of seeking to rob any of them of the ability to do that. On a serious note, the Bill is not about work experience, which is a good thing. It does not concern itself with volunteering, which is also a good thing. The Bill does not concern itself with internships, because that would require specific legislation, but I shall return to them, because the Minister announced a Government initiative on them earlier in the year.
Jeremy Quin (Horsham) (Con)
I am listening carefully to the hon. Gentleman’s speech. Following on from the point made by my hon. and gallant Friend the Member for Beckenham (Bob Stewart), how do we sort out the situation wherein someone comes in for work experience and is subsequently employed, because that can happen? It is a good thing for someone to come into an office environment, enjoy the role—it works—and then subsequently get employed some weeks or months later. How do we ensure that we do not penalise employers in those circumstances?
Stewart Malcolm McDonald
I do not know whether the hon. Gentleman has read the Bill—I know him to be diligent and I am sure that he has—but I shall come to how we split that out and ensure that there are no crossed wires.
Mark Tami (Alyn and Deeside) (Lab)
Does the hon. Gentleman agree that unfortunately, in perhaps only a small number of companies, one trialist is replaced by another and then another, and so on? Those companies use trial shifts as a way of getting free work.
Stewart Malcolm McDonald
The hon. Gentleman anticipates where my speech is about to go, but to come back to the point made by the hon. Member for Horsham (Jeremy Quin), in the hospitality and retail sectors, where this practice is known to be widespread—it is by no means exclusive to those sectors, but it does happen in them rather a lot—there is a difference between a person applying for a job to be, for example, a barista in a coffee shop or a cocktail maker in a hotel bar, and their demonstrating that they can do the things that they have said they can do, which is fine, and a trial shift in which the applicant is asked to work alongside someone on a paid shift, doing the same job as them, but is not paid.
The Government think that the existing law is sufficient to deal with and prevent that kind of thing from happening but, as the hon. Member for Alyn and Deeside (Mark Tami) said, all too often a company advertises an unpaid trial shift, and in some cases it might be two or three hours, but in some of the more extreme cases, including the case that first brought this issue to my attention, it is 40 hours. Yesterday, the BBC interviewed someone who had done four weeks of unpaid trial work. Here is the deeply cynical element: in a lot of cases, there is not actually a job to give the person—it is about covering sickness, staff shortages, busy periods over Christmas or wedding seasons in hotels. That is where the law is insufficient to prevent gross exploitation.
Neil Gray (Airdrie and Shotts) (SNP)
I hugely commend my hon. Friend for introducing this Bill and for the strong and erudite way he is presenting it. Is not the greatest tragedy of trial shifts that most often the people who are exploited have learning disabilities? They are desperate for work and see these shifts as their only opportunity. That is a key reason why the Bill must be passed.
Stewart Malcolm McDonald
My hon. Friend makes a very good point. Too often that is what happens. The people who fall victim either do not know their rights and cannot stand up for them, or are unwilling to challenge employers on their rights because they are in fear of losing their job. This practice hits the lowest paid and the lowest skilled in our economy, and this is a Bill to protect the lowest paid and the lowest skilled in our economy.
Several hon. Members rose—
Gordon Marsden (Blackpool South) (Lab)
The hon. Gentleman is being extremely gracious. I congratulate him—as I am sure do most Members in this House—on bringing this Bill before us today. We have just had National Apprenticeship Week. Not least of the evils of the present situation, is that, first, it prevents the sort of serial offenders that he is describing from doing something decent such as offering an apprenticeship, and secondly, it hides them from exposure for not taking such things forward in the first place.
Stewart Malcolm McDonald
The hon. Gentleman makes a very important point and we are better informed for it. There cannot be a Member of the House who did not celebrate National Apprenticeship Week. On the back of that, if nothing else, this matter certainly merits Parliament’s attention this afternoon.
Chris Stephens (Glasgow South West) (SNP)
I thank my hon. Friend and constituency neighbour for giving way and, obviously, congratulate him on bringing forward this Bill. He organised a drop-in this week. We heard from Maxine Clifford, a Glaswegian, who is regularly put on unpaid trial shifts of at least 10 hours a day. That is one of the principal reasons why we need this Bill to go through this afternoon.
Stewart Malcolm McDonald
I absolutely agree with my hon. Friend. Surely to goodness, there is not anyone on a Bench here in this House who thinks that that kind of practice can be justified.
Stewart Malcolm McDonald
I see that the hon. Gentleman is nodding, and thank goodness for that. I thank him, too, for his support for the Bill—he was actually a very early supporter of it.
My hon. Friend the Member for Glasgow South West (Chris Stephens) is absolutely right. I argue, as I am sure that he, as a man with fine trade union credentials that would be tough to challenge on these Benches, does too, that employment law is heavily stacked in favour of the employer. It actually provides employers with sufficient instruments to try people out as it is. Why can people not be put on a probation period, as is normal in most mainstream jobs where good employers do that? For example, the Conservative-led coalition, of two Parliaments ago now, changed employment law so that people can effectively be dismissed in the first two years of employment. That is something that I disagree with; I would not have voted for that. None the less, with those kind of instruments at employers’ disposal, there is no need to try people out for 10 hours, 40 hours, or four weeks, as I mentioned earlier.
Hugh Gaffney (Coatbridge, Chryston and Bellshill) (Lab)
I thank the hon. Gentleman for giving way. Does he agree that working conditions are deteriorating? I have known sons and daughters—I have known many people—who have suffered the abuse of unpaid work. That is why I strongly support the trade union movement. I suggest that everybody should get into the trade union movement to stop the abuse of workers. If the Tory Prime Minister was prepared to put money where her mouth is, she would support these workers and stop this practice.
Stewart Malcolm McDonald
I am very grateful to the hon. Gentleman for his point. There is an important message there that I know the Scottish Trades Union Congress would wish me to send: workers who are affected by this practice, and those who are not, should join trade unions. The prohibitive problem is that, where people are in that kind of precarious work, it is financially difficult to sustain a trade union membership. This Bill will help to give some protection and some security to people who badly need it; the hon. Gentleman is right on that point.
Lloyd Russell-Moyle (Brighton, Kemptown) (Lab/Co-op)
Does the hon. Gentleman recognise Unite community section, which has low rates specifically to protect those people who are out of work? There are options in the union sector to protect people who are on low wages or no wage.
Stewart Malcolm McDonald
I commend that point. When I first floated the idea of the Bill, I recall receiving an email from Unite, saying, “Stewart, we need to talk.” I realised that that would cause a shiver to run up the spines of Labour members; it caused one to run up mine, too.
We had a very fruitful conversation. Unite has been immensely supportive, and I would mention in particular one of its Scottish organisers, Bryan Simpson.
The Better Than Zero movement has collated lots of information—way more than I have—on precarious work and unpaid trial shifts. It has also taken some direct action against rogue employers, who get up to all sorts of things such as stealing tips from part-time staff and all the rest of it. There is a lot to sort out. Although this Bill does not deal with all of it, I hope that we can all agree that it deals with an important element.
Luke Hall (Thornbury and Yate) (Con)
Does the hon. Gentleman agree that this practice of abuse is carried out by some of the biggest and best-known employers in the country, which often put unrealistic productivity targets on their staff that are almost forcing them to use any method they can to get home before midnight?
Stewart Malcolm McDonald
This may be the only time that I have looked forward to using my parliamentary privilege: I am going to name some companies that have come up when I have had this conversation with people.
The first company that came up was Mooboo Bubble Tea. I understand why there are confused looks on some Members’ faces because I do not know what bubble tea is either, but I can tell hon. Members that I will not be trying Mooboo’s. Mooboo was the company—based in Glasgow, with franchises right across the United Kingdom—that asked one of my constituents to work 40 hours for no money whatever. Not only did my constituent not get the job, although I am sure that she made a fine fist of the trial period, but the company just ignored her. It happens too often that people apply for jobs, go through trials and all the rest of it, but then do not even get told yes or no. They just get left hanging in the air. What a cynical and gross way to treat applicants in this day and age!
Chris Philp (Croydon South) (Con)
I quite agree with the hon. Gentleman that this case is a shocking example of abuse. Did he report the matter to HMRC for investigation? If he did, will he update the House on the outcome?
Stewart Malcolm McDonald
Yes, I did. I sent a letter to the former HMRC Minister, Jane Ellison, who I think is now employed by the Government as a special adviser—[Interruption.] Forgive me, I may have got that wrong. Jane Ellison did deal with the case for me at the time. I had a conversation with her on one of the few occasions that we were in the same Lobby, and she assured me that my complaint was passed on to the right people. Part of the problem with raising an issue via a Minister, rather than directly to the unit, is that we do not actually get told the outcome of the investigation.
If hon. Members come across cases where there is any question that the definition of the national minimum wage has been abused, I encourage them to report the situation to HMRC. I did a Facebook Live broadcast with House of Commons digital officials earlier this week, and I gave lots of examples from members of the public who have gone through such things. People rely on the National Minimum Wage Act 1998, and the low paid rely on it more than any other group in society, so it needs to be enforced with rigour.
David Warburton (Somerton and Frome) (Con)
If the hon. Gentleman was able to take the case he mentioned to HMRC and it was resolved, why is there a need for new legislation?
Stewart Malcolm McDonald
Forgive me, but I did not say that the case was resolved. I said that I do not know the outcome, because the then Minister told me that she would not actually get told the outcome of such cases.
After blocking Members of Parliament on social media who highlighted the issue and then unblocking them all later that day, Mooboo Bubble Tea sent me a letter to say that the activity carried out in my constituent’s case was actually training. Training is actually covered by the National Minimum Wage Act, so Mooboo was still in breach of the law if that were the case. The company did, however, tell me that it had changed its practice as a result. Now, I have not found any available positions that I could perhaps have applied for myself, under cloak and dagger, in order to work out what happens. I do, though, understand that Aldi opened a big new store in the north-east of Scotland, advertising 150 unpaid trial shifts. This cannot go on, and today we have a chance to end it.
Alan Brown (Kilmarnock and Loudoun) (SNP)
I congratulate my hon. Friend on bringing this Bill forward. He just mentioned training, which I know about from personal experience. My son Dylan undertook unpaid training with a company that is employed by charities. It was to be a week’s unpaid training with a view to a job at the end. Does my hon. Friend agree that it is terrible that charities, which are supposed to exist to raise money for the greater good, are exploiting people in this way?
Stewart Malcolm McDonald
My hon. Friend is absolutely right. I did not even know that he had a son called Dylan.
Stewart Malcolm McDonald
I am sure that is untrue.
I mentioned retail and hospitality because those were the industries that came up most in my consultation. Amazingly, the British Retail Consortium refused even to discuss the issue with me because it thought there was not a problem. That is news to a young man from North Lanarkshire who was abused by the retail store, B&M Bargains. I used to love going into B&M Bargains, perhaps to pick up some toothpaste and then spending 25 quid because it is the kind of shop where people buy things they do not need. I was horrified to learn that it had had a young man with autism, in the hope of securing work, stacking shelves for three or four days, only to dismiss him at the end of it, saying, “You’re not required any more—off you go”, with no pay and no chance of a response.
Stephen Kerr
What interests me is the demoralising effect of that situation on that individual. It is this devil-may-care attitude towards other people that really gets under my skin. This Bill is about fairness, and I commend the hon. Gentleman for bringing it forward.
Stewart Malcolm McDonald
I am very grateful to the hon. Gentleman, who has been a great supporter of the Bill from the outset and has had good input into it too. He is right—it is a deeply horrifying and cynical practice. Imagine if that was your first introduction to the world of work: how would it make you feel about trying to secure work for yourself in future? I think we are all united in believing that it is a good thing when people want to go out there and secure work of some kind.
Stewart Malcolm McDonald
The MP of the constituent in the case I have mentioned wishes to intervene.
Neil Gray
The worst part of that story was that my constituent was rota-ed to be in that work the following week, which gave him the impression that he had in fact secured the job. He was told, on the last day possible, that he had not applied enough effort, which was clearly patently wrong. That type of behaviour is utterly shameful and must be called out.
Stewart Malcolm McDonald
I did not know that additional detail. It is shameful and it is right to call it out. It is the last time that I will be setting foot in B&M Bargains, which is a great shame because I pass it on the way to my constituency office every day. Let me say that I mean no malice to the workers of that company but instead the bosses who allow that kind of practice to go on.
Martin Whitfield (East Lothian) (Lab)
I fully support this Bill, as I have from the outset. Does the hon. Gentleman agree that as well as the fact that this work is unpaid, there is great danger with regard to health and safety, training, other staff members, and members of the public? Unscrupulous employers are putting everybody in danger, and also damaging the reputation of the good employers who do not engage in this.
Stewart Malcolm McDonald
The hon. Gentleman makes a very good point. He has been a fine supporter of the Bill—a sponsor, no less. He is right. Not everyone does this, and those who do give good employers a bad name. That is why I made the point in response to the hon. Member for Stirling (Stephen Kerr) about the damage this will do in people’s minds if it is their first experience of the world of work.
I want to square up what the Bill does and why it does it. It is essentially split into two main parts. The first part amends the National Minimum Wage Act 1998. It makes it clear that where someone takes part in a trial shift—it defines what a “trial shift” is—they are to be paid at least the national minimum wage, and that the Bill applies right across the United Kingdom.
I have put in some safeguards based on the feedback I have had from members of the public, as I have been discussing. First, when a member of the public is offered a trial shift, it is to be made clear to them in writing how long it will last so that people cannot be strung along. It will also be made clear how many jobs actually exist. That should put an end to the practice of offering “ghost” shifts where no job actually exists.
Secondly, the person and the employer are to have an agreement that proper feedback is going to be received. In one case, a person—I will not identify them but it was the daughter of a prominent Scottish Labour politician —went on a trial shift in a bar, worked three or four shifts, and at the end of it the employer said to her, “We’re not taking you on—you don’t have enough experience.” They already knew that from looking at her CV at the application stage.
We have to try to empower applicants a bit, because people are feeling helpless. This is not about ending trials or the ability of an employer to test someone; it is just about ending the ability to take someone for a ride and pay them nothing.
Ruth Cadbury (Brentford and Isleworth) (Lab)
I thank the hon. Gentleman for bringing this important Bill forward. I was not really aware of this issue until, when my eldest son was a teenager, a couple of his friends worked several unpaid shifts in a restaurant. Does the hon. Gentleman agree that this is particularly rife in the hospitality industry, which many of us partake of and spend money in? If people were more aware of the issue and the need to plug the hole in existing employment legislation, they would support the Bill. Should not all Members support the Bill?
Stewart Malcolm McDonald
Yes, I do believe that. What the hon. Lady says is funny; I have put a name on it—I have called it an unpaid trial shift. Most folk would say, “What on earth is that?” but when I explain it, they realise that their own kids have done it, their neighbours’ kids have done it or their nieces and nephews have done it. Everybody knows somebody who has done it.
On hospitality, I will say this. I had a very constructive meeting with the British Hospitality Association, which supports measures such as this because it wants the industry to be seen as an attractive place to work and build a career in. Anything this Parliament can do to help hospitality or other sectors can only be a good thing.
Nigel Huddleston (Mid Worcestershire) (Con)
Will the hon. Gentleman give way?
Stewart Malcolm McDonald
I know that the hon. Gentleman has an interest in hospitality, so I will give way.
Nigel Huddleston
Not any more, I am afraid. I thank the hon. Gentleman for giving way. He is making some really important points. I am glad he recognises that the hospitality and leisure industry, which employs about 3 million people in the UK, has good and bad practices, but they are generally good. That is important to recognise.
First, I think we are hearing a clear message from this House to the Minister that, depending on how the Bill progresses today, we need to make sure existing legislation works properly, because that is one of the gaps. Secondly, on the great Tory philosophy of “make work pay”, anybody who makes anybody work must make sure they pay them.
Stewart Malcolm McDonald
I never thought I would bring forward a Bill that encompasses Tory philosophy, but this is a Bill that makes work pay. I hope the hon. Gentleman will do everything in the short time left to make sure the Bill proceeds.
I want to bring my remarks to a close, to allow others to say what they wish. The hon. Gentleman’s first point was about whether the law works or not. I do not believe it does, but the Government do. I know that because they have made public statements and because I have had conversations with the Minister. I do not believe the law works, and the legal advice I have suggests that it does not. The trade unions do not believe it does. I shared all that advice with the Government after they asked for it and had no issue in doing so, but it does not seem to have changed their mind. If the law did work, there would have been one tribunal in 20 years of the law that the Minister says covers this, but there has not been. That, in itself, tells me that the law does not work.
I know the Minister believes that the law covers trial shifts and unpaid internships. He said to me, “Stewart, we have no wish to derail your Bill, but we think the law covers it already.” Let us split that proposition, because those two things cannot sit comfortably together. If the law as it stands covers this—if the Minister listens, I can educate him—there is a problem for the Minister, because I have found on the w4mp website an unpaid internship from 2012 in his office for three to six months.
Stewart Malcolm McDonald
I will allow the Minister to respond; he does not need to get too excited. If it is the case that the law as it stands bans unpaid shifts and unpaid internships, either he has to refer himself to HMRC, or I am afraid I will have to do it for him.
Andrew Griffiths
I would be very interested to see that. I have never, ever had an unpaid internship in my office.
Stewart Malcolm McDonald
I can assure the Minister —I will send it to him when the debate concludes—that there is an unpaid internship advert on the w4mp website. I checked it just before the debate started and am happy to let him see it. I think he is looking it up as I make this point, but I assure him it is there. That is something that many parties in the House take part in. I think internships are enormously valuable, but if the Minister is so convinced that the law as it stands is functional, that raises questions for what he and others have done.
Danielle Rowley (Midlothian) (Lab)
I congratulate the hon. Gentleman on his work on the Bill. As the youngest Labour party Member of this place, it would be remiss of me not to mention the adverse effect of unpaid trial shifts on young people. Does he agree that young people are massively affected, and given that they may not have the mechanisms available to older workers, will he join me in calling on all young people to join a trade union?
Stewart Malcolm McDonald
The hon. Lady is right, and I join her in calling on all young people to join a trade union. I should mention that, as I am sure she will know, the Scottish Youth Parliament has endorsed the Bill, and a fine job it made of that.
David Linden (Glasgow East) (SNP)
In the light of the information that my hon. Friend has given, will he place a copy of it in the Library of the House so that all Members can familiarise themselves with it? That is a very interesting point.
Stewart Malcolm McDonald
I am happy to place that information in the Library, although I rather suspect that it will find its way on to Twitter soon enough.
In closing—I do not wish to cheat the Minister out of his time—this is a Bill that makes work pay and that empowers people who, as the hon. Member for Midlothian (Danielle Rowley) said, need empowerment. This is supposed to be a Parliament of legislators that makes good law. I believe we have an opportunity today to make good law, so let us not filibuster, kill it or somehow ensure that it cannot pass. I realise that is looking tough, but stranger miracles have happened. I ask Members to get behind the Bill, and to get it into Committee. Let us make good law and protect people who need protecting.
Chris Philp (Croydon South) (Con)
It is a great pleasure to follow the very thoughtful, well-researched and well-considered speech by the hon. Member for Glasgow South (Stewart Malcolm McDonald). I must say that I found myself in agreement with large parts of it, partly because I am a very passionate believer in the national minimum wage.
One of the things I did after I was first elected in 2015 was to seek out the then Chancellor of the Exchequer, George Osborne—I understand he is more than modestly occupied these days—to press him on what I thought was the very strong case for a big increase in the minimum wage, because it is so important, and I was delighted when, a short time later, the Government announced large increases in the minimum wage. I am very proud of the fact that a Conservative Government, between 2010 and today, have increased the minimum wage from £5.93 an hour back in 2010 to £7.83 an hour today, which is a 32% increase. The national living wage is a legally required minimum wage, and I am very proud that a Conservative Government have increased it by 32%. Over that period, inflation has been only 19%, so it has risen by substantially more than inflation.
Stephen Kerr
Does my hon. Friend accept that the premise of the Bill is that it is a wonderful thing to learn to work, which is a very important part of growing up? The Bill is particularly about protecting the young, however, so is it not an important lesson for the young to learn that if they go to work and they work hard, they are also entitled to be paid fairly?
Chris Philp
Yes, I agree with that principle. As my hon. Friend pointed out in his earlier intervention, the idea that people should be fairly paid for a fair day’s work, or even for a fair few hours’ work, is an important Conservative principle, and I think it is an important fundamental right as well, so I agree entirely with that premise.
I want to put on the record once again my very strong support for the concept of the minimum wage—the national living wage—and the fact that it has been increased by such a large amount. While talking about wages for those on low earnings, I would point out in passing that the increase in the tax-free allowance in the past few years—from £6,500 to £11,500—means that take-home wages for people on the minimum wage, the topic of the Bill, have actually gone up by 37%, because not only has the minimum wage gone up by 32%, but they are also paying proportionately less tax. It is important to bear it in mind that low tax, as well as a decent wage itself, has a role to play in making sure people are properly paid.
We have talked quite a bit already about enforcement. Clearly, a national minimum wage, or national living wage, is only as effective as its enforcement, as the hon. Member for Glasgow South touched on. In the last financial year, 2016-17, HMRC, the body responsible for enforcing the national minimum wage, took action against 1,134 individual businesses—quite a good track record of taking action to enforce the minimum wage; clawed back £10.9 million—a fairly substantial sum; and took action that encompassed 98,000 workers who had been illegally underpaid. That suggests that HMRC is taking its enforcement role very seriously and enjoying some success in making sure that the national living wage and minimum wage are adhered to.
Bob Stewart
Just to clarify, HMRC did not keep the money but presumably gave it to those who had lost it. Is that right?
Chris Philp
When someone has been illegally underpaid, I believe that they receive retrospective compensation. As to where the funds go, I rather suspect they end up with Her Majesty’s Treasury, but certainly the unfair loss suffered by people who have been underpaid is made good.
Lloyd Russell-Moyle
My brother took part in one of these trials for a telephone sales company. He worked for two days unpaid while having to pay for transport up and down. He is a physics graduate—very intelligent—and knows that it is illegal, but he has no confidence that if he reports the matter, it will go anywhere. Is not part of the key to enable easier reporting to HMRC and to require companies to report how many jobs are available, as the Bill requires, and is that not why the Bill is needed?
Chris Philp
I will come to the substance of the Bill in a moment, but I entirely agree that the hon. Gentleman’s brother’s experience—two days!—is clearly well beyond anything that is remotely reasonable and also that reporting should be made easier. We should put some of these facts into the public domain so that people who think they might have been unfairly abused, either in this area or a related one, can report the companies and action can be taken.
Kevin Foster (Torbay) (Con)
My hon. Friend is making an interesting speech. Does he agree that one way of dealing with this is to have very clear guidance on the existing law about what is an acceptable trial period and what is flagrantly trying to dodge the law and the minimum age, as Mooboo Bubble Tea tried to do in Glasgow?
Chris Philp
I will come to that point, but first I want to put two other facts about enforcement on the record. First, HMRC has a team of 400 people working on this. I am very sorry that the brother of the hon. Member for Brighton, Kemptown (Lloyd Russell-Moyle) did not feel able to report the matter to one of those 400 HMRC staff. Secondly, the budget for enforcement was recently doubled from £13 million to £25 million, which I hope gives some confidence that HMRC and the Government are taking this very seriously.
I turn now to the point just raised by my hon. Friend the Member for Torbay (Kevin Foster). There is clearly an issue with enforcement. My understanding of the law is that excessively long unpaid work trials are currently unlawful and should be paid. We have heard three examples in the Chamber today, two from the hon. Member for Glasgow South and the one we heard a moment ago from the hon. Member for Brighton, Kemptown. All involved periods of work—two days in the last case and periods of two or three days and 40 hours in the other two—that strike me as clearly far in excess of what is reasonable and ought to fail the test of not being excessively long unpaid work trials. I would welcome the Minister’s confirmation that those three examples do indeed contravene existing regulations and that, in his view, had they been reported—I think one or two were—the company would likely have been found against.
Michelle Donelan (Chippenham) (Con)
Current legislation states that a job should be intended at the end of a trial period, but in some of the examples we have heard that is not happening. There is a potential problem with the enforcement of current legislation, so perhaps we need a review of that, rather than to duplicate our laws.
Chris Philp
If trials are taking place with no certain job at the end, or no vacancy, that is an outrageous abuse.
Chris Philp
It is indeed fraud as my hon. Friend says, and I entirely agree with his interjection. I look forward to the Minister offering his thoughts on that in due course. [Interruption.] Excuse me Madam Deputy Speaker. I am recovering from the remains of a cold that my children kindly gave me last week. [Interruption.] Does the hon. Member for Glasgow Central (Alison Thewliss) wish to intervene?
Chris Philp
That is a very kind suggestion, but I am afraid I have not yet finished. This is an important matter, and we will give it due consideration—[Interruption.] That has made my cough even worse.
As I understand, under current drafting, any period of trial working, even as little as five minutes, would fall foul of the Bill. [Interruption.] The hon. Member for Glasgow South is nodding his head in assent. As with any piece of regulation, there is a balance to be struck. I completely agree that all the examples we have heard about are totally unreasonable. Such behaviour should be unlawful, and those companies should be prosecuted and fined. However, there are examples—I am coming to the conclusion of my remarks—of companies that, quite legitimately, want someone to do a reasonable amount of trial work, by which one might mean a few hours. I would consider three or four hours to be the maximum amount of time considered reasonable, and it could be unfair to impose on those businesses the administration involved in setting up payroll, PAYE, national insurance, a return to HMRC and so on, for a short and reasonable period of trial work.
Stewart Malcolm McDonald
The hon. Gentleman knows about other instruments that exist for employers, and someone’s skills can be tested. If he applies to work at my coffee shop and I ask him to prove that he can make a cappuccino, he will do what he has to do, and I will be satisfied with that. I do not need to put him on a shift with the rest of my staff and have him working alongside other colleagues, serving customers and contributing to my profit margin without payment.
Chris Philp
As we have discussed previously, that would be wholly unreasonable for an entire eight-hour shift. However, a trial for an hour, testing someone serving coffee in a live work environment, for example, gives the potential employer information about that person’s suitability. In the coffee shop example, I would consider it reasonable to have someone work for one hour as a trial and not require payment. Working an eight-hour shift would and should require full payment. My concern is that the one-hour trial would get caught by the Bill as drafted.
Chris Philp
I am not sure that it is. If someone is taken on as an employee for a probationary period, the reasonable expectation is for them to work with the company for a few months—a probationary period is typically at least one month, and in some cases three. Asking an employer to employ for between one and three months someone who, it transpires after a few hours, is unsuitable is a little unfair on the employer.
Several hon. Members rose—
Chris Philp
I am spoilt for choice, but I will first give way to my hon. Friend the Member for Thornbury and Yate (Luke Hall).
Luke Hall (Thornbury and Yate) (Con)
Does my hon. Friend accept that some people are much more comfortable doing a trial period of one hour than they are sitting through an interview of 45 minutes, which they might find extremely stressful and uncomfortable, and for which they might be unprepared?
Chris Philp
I agree with that point. I set up and ran my own businesses for 15 years before being elected, and found that often interviews are not a very good way of ascertaining someone’s suitability. People can come up with all sorts of nonsense, but if they get to do the job in some way, even for a short period such as an hour, the employer learns a lot about their capability.
Chris Green (Bolton West) (Con)
I appreciate the point about the coffee shop and the mechanical process of producing coffee, but would my hon. Friend accept that a far more subtle process is needed to assess social skills before an offer of employment is made?
Chris Philp
In a sense, all of us here have done a gigantic free trial shift: it is called being a parliamentary candidate. I was first selected in December 2006 and ran in the 2010 election. I then proceeded to lose by 42 votes, so that was a pretty extended unsuccessful four-year unpaid trial period.
Michelle Donelan
Does my hon. Friend agree that a trial period can be beneficial for those trying out for a job, so they can see if they want and like the job? When I was younger, I did a trial period for a few hours. This is about getting the balance right between rights and responsibilities. We do not want to exploit anybody; we want to create and facilitate opportunities and jobs.
Chris Philp
A short trial period—just be clear again, I mean one to two hours—can give an employer the confidence to give someone a job, perhaps someone from a disadvantaged background who does not necessarily come across very strongly in interview. That might give an employer the confidence to employ that person when they might not otherwise do so.
Patricia Gibson (North Ayrshire and Arran) (SNP)
I wonder if the hon. Gentleman can clarify something for me. I am listening very carefully to what he says, but I cannot understand why there have to be unpaid trial shifts when it would be much fairer just to put somebody on a temporary contract, then assess them and decide whether to give them a permanent contract.
Chris Philp
To be absolutely clear, I do not think that full, unpaid trial shifts are ethical, right or moral. My understanding is that they are illegal already, and if they are not illegal they certainly should be made so. I definitely do not want full, unpaid trial shifts to be legal. However, a short period of time—one or two hours, I would suggest—should not require a temporary contract. Asking someone to enter into a temporary contract entails a certain amount of paperwork and bureaucracy. Notwithstanding the point about the two years, in relation to discrimination it creates immediately binding legal obligations. To do all that for someone who is essentially going through an interview process imposes an unreasonable burden on a prospective employer. If an employer is interviewing 10 people for one position, to have to give all 10 a temporary contract would be excessive in the context of a one or two-hour trial.
I have spoken for a little bit longer than I planned to. Before I conclude, I will take one last intervention.
Jeremy Quin
My hon. Friend referred to his time as a parliamentary candidate. As we all know, as a parliamentary candidate one receives a lot of feedback whether we like it or not. One of the powerful points made by the hon. Member for Glasgow South (Stewart Malcolm McDonald) in his excellent speech was in relation to feedback from employers to prospective employees, an excellent idea that should be encouraged. I worry that companies are very nervous about providing honest and helpful feedback. If the Bill moves on to the Committee stage, I hope—as a former employer—that that point is focused on so that a safe harbour can be established.
Chris Philp
I agree. We heard from the Scottish National party Benches about a powerful case study. It is a gross discourtesy—an insult, in fact—to interview someone, have them go to the trouble of coming to your place of work, going through an interview and possibly doing some trial work, and not even provide feedback for them. That discourages people from going to interviews.
Stewart Malcolm McDonald
If the Bill does not get a Second Reading and go on to Committee, that will continue to happen. Does the hon. Gentleman agree that the Bill should go on to the Committee stage?
Chris Philp
I have a very open mind. I would like to hear what the Minister has to say in response to the questions I have posed, in particular on whether one or two hours of work is part of current legislation.
In conclusion, there is a balance to strike. If we impose too many barriers to creating employment—this applies to generally onerous employment legislation—there is a risk that rather than protecting people, we prevent jobs from being created. One of the reasons why this country has created 3 million jobs in the past eight years—more than the rest of Europe put together—is that we have a sensible balance between protections for workers on the one hand and avoiding over-burdening employers on the other. I am very nervous about upsetting that delicate balance.
As I said at the beginning, I agree that practices relating to full shifts in this context should not be lawful. I will listen very carefully to the Minister’s comments when he winds up the debate.
Dr Alan Whitehead (Southampton, Test) (Lab)
May I congratulate the hon. Member for Glasgow South (Stewart Malcolm McDonald) on bringing this important and well-constructed Bill to the House? We have perhaps been diverted towards the issue of people not being paid for one or two hours’ work, but essentially the Bill is about the principle of a fair day’s pay for a fair day’s work. Unpaid work trials have become a widespread practice in the hospitality, entertainment and retail sectors, and we need to place that development in a wider context.
In recent years we have witnessed an explosion of exploitative working practices associated with the so-called “gig economy”, a commonplace phrase that does not do justice to what is really occurring, namely the avoidance of employment rights, benefits and remuneration on a mass scale. Unpaid work trials must be seen in the broader context of a range of sharp practices associated with low paid, insecure employment in this country, designed to cut the burden on the employer at the expense of hundreds of thousands, if not millions, of workers.
Just in the past few weeks this place, as the hon. Gentleman has mentioned, has discussed tipping practices that take rightfully earned tips from waiting staff and recycle them to top up the pay of other workers to the level of the minimum wage. In the past two weeks we have seen how major, international companies such as Wagamama and TGI Fridays have failed to pay their staff the minimum wage.
Dr Whitehead
Yes, I share the hon. Gentleman’s shock and concern. That underlines how a number of very important institutions in this country continue to underestimate and even turn a blind eye to all such practices associated with the gig economy, one of which is unpaid work trials. There is a pattern and it has not been clearly addressed by the Taylor review, and it certainly has not been addressed by the Government’s weak response to that review.
More than £1 billion is lost in wages every year through unpaid work, and the continuing practice of unpaid work trials is a contributing factor to that.
Stewart Malcolm McDonald
I think I know the report to which the hon. Gentleman refers, but a subsequent report adumbrates that about £3 billion is lost in wages every year.
Dr Whitehead
Obviously, £2 billion has been lost since I last looked. That underlines the big picture. Unite the Union says that there has been a sixfold increase in complaints about the practice in the past three years. Indeed, the personal stories of exploitation collected by the hon. Gentleman chime with many of us, as we have heard today, through the experiences of our constituents, our own children and our local communities.
Mr Paul Sweeney (Glasgow North East) (Lab/Co-op)
As the second youngest Labour Member in the House, I can speak from relatively recent experience. My first experience of the world of work was an unpaid trial shift against four other candidates for a job. It was a full day’s shift and unpaid. That was combined with a zero-hours contract and unfair tipping practices whereby we were never given our tips and they were used to subsidise the minimum wage. Moreover, young people are unaware of trade union rights, how to join a trade union or how to engage in that sort of security in employment. That is the root cause of the problem. It is the duty of this Parliament to legislate for and protect our young people and others who are exploited by such nefarious practices.
Dr Whitehead
My hon. Friend makes an important point. He seems to have personally experienced all the various aspects of this problem: they came together on one occasion, in one place and happened to one person.
Many people have talked about their own experiences. One example comes, in fact, from Scotland. K from Kilmarnock says:
“My son was asked to do a trial shift in our local restaurant. The manager who was on shift did not even speak to him when he was in! He was left in the bar with no direction and when he tried to help the others he was told to get back behind the bar! He wasn’t paid a penny for his time. The same restaurant had already done the same thing to a friend of mine’s son except it was for a kitchen porter and he did 4 hours, no pay and again at end of his shift he just left waited over a week with no job offered.”
The use of unpaid trial shifts is a real problem under the current legislation. The concept of “shadowing” has been used by employers to justify bringing in unpaid workers to cover staff shortages, sickness, or particularly busy periods and events. There is a need to clarify the legal position for employees and employers with legislation, and the Bill seeks to do that by closing current legislative loopholes to ensure that workers are paid for every hour they work and every shift they do.
Bob Stewart
I think that what the hon. Member for Glasgow South (Stewart Malcolm McDonald) has put together is excellent, and I congratulate him. I also congratulate my hon. Friend the Member for Croydon South (Chris Philp). “Souths” seem to be in the air today!
Can it be made absolutely clear that the Bill will not apply to someone who goes along to have a taster for a day, does not necessarily work a shift, but just gets an experience of what the work is like? That is not what the Bill is about, is it?
Dr Whitehead
My clear understanding, which I think will be borne out by the hon. Member for Glasgow South, is that that is not what the Bill is about. It is not about work experience, or any of the other factors that the hon. Gentleman has mentioned.
Andrew Griffiths
May I clarify the position? As drafted, the Bill would exclude those factors. Anything, including making the coffee, briefly, would be outlawed. The Bill sets the threshold at zero. Any moment spent working would be caught by it.
Dr Whitehead
I am not sure, if I may say so, that the Minister has correctly put across the idea of what “working” is. Various activities that do not actually constitute work, but constitute other activities not related to work, would not be covered by the Bill. When what is clearly work is being undertaken, and that work is recognised in the normal sense of the word, it will be covered.
Andrew Griffiths
May I clarify the position again for the hon. Gentleman? That kind of trial, or test, would not be covered by the national minimum wage, so the payment would not be applicable anyway.
Dr Whitehead
I think the point of the Bill is that it is intended to close gaps in legislation in order to make it clear what people are doing when they are working and what constitutes trial work, and to ensure that that is much better defined and protected.
The Bill would require employers to pay applicants undertaking trial work periods at least the national minimum wage. Equally important is the clarity that it will provide about what a “work trial” is, and what is the relationship between the employer and the worker at that point. I am sure we all agree that many unscrupulous employers have taken advantage of that grey area to use unpaid labour when there has not been a job on offer, simply to cut staff costs. There is an element of coercion as well. A widespread response to the call for evidence was that many people who had undertaken unpaid work trials had felt that they could not refuse to do so or speak up because of a fear of jeopardising their chances of getting a job.
Michelle Donelan
Does the hon. Gentleman not accept that there is a difference between exploiting people by employing them to do shifts when jobs do not exist, and trying people out for an hour or two and giving them an opportunity to prove themselves?
Dr Whitehead
Of course there is a difference, and this Bill does not fundamentally change that position: it is my understanding that it seeks to clarify what it is to actually do work and, following that definition, get paid for that work. The principle is that if someone does work—defined as serious work, which I am sure the hon. Lady agrees the arrangements she mentions would not be—they should get paid for it. It is as simple as that.
Mr Sweeney
There is a world of difference between an exploitative unpaid trial shift in a casualised context such as I experienced in my first job, and going to a controlled and time-bound assessment centre, which took a full day, as I did for my first graduate job, where it was controlled and defined. The Bill seeks to define that difference, and the Government should support it.
Dr Whitehead
If, indeed, methods are being sought not to support the Bill because of quibbles about what is work and what is not work, and what are trials, and when someone is just doing a practice, that would be a great shame. We need to make it clear that this is about a principle and an area of bad practice that needs to be shut down.
There has been widespread public anger about the practice of unpaid trials. We have heard about the two Mooboo Bubble cafés in Glasgow, which sparked this Bill and campaign, and 13,000 people signed the petition objecting to that. Indeed, the petition calling on MPs to support the Unpaid Trial Work Periods (Prohibition) Bill has 137,000 signatures. It is therefore clear that the practice of unpaid work trials goes against the sense of natural justice that most people have.
There is also widespread public support to remedy this issue as soon as possible, through the clarification of the contractual relationship between the worker and the employer, and the amendment of section 54 of the National Minimum Wage Act 1998 to require the minimum wage to be paid to those who participate in work trials.
Of course, as I stated at the beginning of my contribution, the abuses associated with work trials are part of a much broader picture. The serious, long-term remedy for this all-too-common exploitation is a raft of worker protection measures. Right at the head of Labour’s manifesto commitment at the last election to a fair deal at work is our pledge to
“give all workers equal rights from day one, whether part-time or full-time, temporary or permanent—so that working conditions are not driven down.”
After years of diminution of workers’ rights, that will be no easy task, and we will be faced with many similar loopholes to close and abuses to tackle. I am pleased to offer Labour’s full support for this Bill, to deal with this particularly unjust form of exploitation, which, as my hon. Friend the Member for Midlothian (Danielle Rowley) mentioned, affects so many young people across the country at the start of their working lives. It gives them the impression that the world is perhaps stacked against them in their working career. If only for that reason, we need to ensure that this Bill progresses today.
Andrew Griffiths
On a point of order, Madam Deputy Speaker. May I clarify something? The hon. Member for Glasgow South (Stewart Malcolm McDonald) mentioned an advert for an unpaid internship. I can confirm that that position was never filled; it was advertised, but never filled. I am, however, reminded that a paid researcher worked for me for, I think, a brief 20 days of internship with travel expenses paid before she took on the role as a full-paid researcher. It was so brief that it had slipped my mind, but I apologise if I misled the House in any way.
Madam Deputy Speaker (Dame Rosie Winterton)
The hon. Gentleman has done exactly the right thing by clarifying that as quickly as possible and putting the record straight.
David Warburton (Somerton and Frome) (Con)
I congratulate the hon. Member for Glasgow South (Stewart Malcolm McDonald) on bringing this Bill before the House. This subject is a fascinating area to explore, and I speak as somebody who has had rather a lot of experience in the jobs market: before being an ornament on these green Benches I was lucky enough to build up a business, before that I enjoyed many years as a teacher, and before all that I did just about everything. I sold sandwiches office to office, I drove a delivery van around London, I cleaned carpets, worked in a nightclub, spent years working in retail, worked as a cleaner, a restaurant pianist—[Interruption.] Oh, yes. I also worked as a very nervous bouncer; you name it, I’ve done it. So I have been a regular paid worker, a casual worker, a zero-hours worker and, like many of us, I have also been a volunteer worker.
For many of those jobs I was expected, quite reasonably, to work a trial shift. It was nothing major or long-lasting; just a test of my limited abilities. Some of those trials were paid, but some were not. It would be just about possible for an unscrupulous employer to work out a way of getting people to work unpaid on an ongoing basis, but they would have to devise a very complicated and convoluted system involving many different workers. Also, that is already illegal, because currently all employers, including many of my former employers, must use only legitimate recruitment practices and tests. In some areas that could include a trial shift, but it must not be excessive in length.
Stewart Malcolm McDonald
Does the hon. Gentleman intend to talk the Bill out?
David Warburton
Certainly not; I am going as fast as I can.
The activities carried out during such a trial assessment would not constitute work. If they did, the trial would need to be paid, and at least at the national minimum wage. As the House will know, that applies from the worker’s first day at work, regardless of whether the employer labels that as a trial. A trial is already not legitimate if an employer has no intention of offering a job and is simply seeking a bit of free labour. Therefore, this is already covered in legislation.
I am worried that the Bill would lead to additional confusion for the voluntary sector and impose yet more regulatory burdens on employers. There is the risk that businesses would think twice about employing more people and expanding. It would also reduce genuine opportunities for people like me to find work. As vice-chair of the all-party group for small and micro businesses, I must add that the Federation of Small Businesses does not support the proposed change, for many of the reasons I have outlined.
The House will note that the Bill has considerable overlap with the Unpaid Work Experience (Prohibition) Bill, which originated in another place and completed its Committee stage on 13 March. That Bill quite rightly seeks to prohibit all unpaid work experience of longer than four weeks.
In conclusion, although I understand the hon. Gentleman’s motivation in introducing the Bill, and I commend him for that, I take the view, as someone who has taken part in many work trials and assessments, that not only is the current legislation sufficient, but hardening the law by creating a blanket ban would not be a productive way for us to proceed.
Michelle Donelan
Madam Deputy Speaker, I think that I have already made my views clear in my interventions.
The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Andrew Griffiths)
I congratulate the hon. Member for Glasgow South (Stewart Malcolm McDonald) on his success in the private Members’ Bills ballot. I am proud to serve as the Minister responsible for the national living wage and for workers’ rights. I am very pleased to respond to this important debate. We all want to see the rights of workers protected; none of us wants to see workers abused, mistreated or unpaid. That is why this Government are at the cutting edge of bringing forward new rights and protections for workers. The House will have seen, just a few weeks ago, our response to Matthew Taylor’s truly groundbreaking report, which not only looks at the modern labour force and how we treat people, but seeks to extend rights and protections to workers and employees who have never had those before.
The Government are proud to protect workers’ rights and are proving that we do not need the European Union to help us do that; we are doing it here in this Parliament. I am very keen to work with the hon. Member for Glasgow South to address the issues that he has raised today. There is a very clear way in which we can do that without the need for further regulations. The law is already very clear on this. These practices are outlawed under the current national minimum wage—