Employment Rights Bill

Report stage
Wednesday 23rd July 2025 Lords Chamber

Report (4th Day) (Continued)

20:45

Clause 113: Power to bring proceedings in employment tribunal

Amendment 154

Moved by

[Lord Carter of Haslemere]

154: Leave out Clause 113

[Lord Carter of Haslemere (CB)]

Amendment 154 in my name seeks to remove Clause 113 from the Bill. Clause 113 was tabled at the 11th hour at Commons Report and gives the Secretary of State the power to bring legal proceedings in the employment tribunal, and to do so not because the Secretary of State is directly affected by what the employer is doing, but rather in place of a worker as if the proceedings had been brought by the worker. This is whether or not the worker consents and even if they strongly object. This is legally bizarre, unworkable and totally unnecessary. It could well destroy the relationship between employer and worker—indeed, any future employment relationship since, remarkably, the clause also applies to individuals who are seeking work.

I will focus on three things: the legal implications, the clause’s workability and its policy flaws. I will start with the legal ramifications. It is unprecedented, as far as I can see, for a Secretary of State to be able to institute employment tribunal proceedings or any legal proceedings in place of someone who does not want those proceedings to take place. The Secretary of State says that the provision is modelled on the Equality and Human Rights Commission but, apart from the very different public law context of judicial review, the commission has never instituted a private law action in place of another individual as Clause 113 now envisages for the Secretary of State.

The case of Wilson, to which the Secretary of State referred in her letter of 7 July to noble Lords, was not such a case, since the commission did not act in place of another person. It is inconceivable that the Equality and Human Rights Commission would initiate proceedings in place of a worker in the employment tribunal, let alone where that person did not consent. For the Secretary of State to be able to do so goes against the long-standing principle that, in order to instigate litigation, a claimant should have a sufficient interest—that is to say, be directly affected by whatever issue is being litigated. Exceptions to this general principle have occasionally been made for pressure groups acting in the public interest but, as the High Court reaffirmed in 2022, not where there is a more appropriate potential applicant who has chosen not to bring proceedings, which is the type of case we envisage.

Moving on to the workability of Clause 113, the debate in Committee showed that one reason why there is no precedent for what is proposed is precisely because any litigation lawyer will tell you it cannot work. If the worker does not consent then how will the Secretary of State acquire the evidence to bring a claim? In Committee, the Minister rejected an eminently sensible amendment tabled by the noble Lords, Lord Sharpe and Lord Hunt, which would have required the consent of the worker before proceedings could be brought. This would have made a major difference, but the Government rejected it, which shows that they envisage the power being used even without the consent of the worker. Without that consent, one can see the possibility of a worker, disgruntled with the claim, trying to invoke Rule 25 of the Employment Tribunal Rules to withdraw the claim and the Secretary of State resisting that attempt—hardly a great use of taxpayers’ money.

Even if the proceedings continue, should the worker, who did not consent to the claim, really be liable for the costs if the claim fails, which could amount to thousands of pounds? Extraordinary as it is, this is the effect of Clause 113(6). It provides that:

“The Secretary of State is not liable to any worker for anything done (or omitted to be done) in, or in connection with, the discharge … of the Secretary of State’s functions”


under the clause. This immunity from liability for the Secretary of State applies irrespective of how incompetently the claim may have been handled.

Furthermore, as the noble Lord, Lord Murray, so graphically articulated in Committee, since it is a power for the Secretary of State to bring proceedings, the unions could judicially review the Secretary of State for not exercising the power. This means there could be, in the noble Lord’s words, litigation to require the Secretary of State to litigate

“on behalf of somebody who does not want to litigate”.—[Official Report, 18/6/25; col. 2048.]

As he suggested, we are in Alice in Wonderland here, but it is where Clause 113 takes us—and all at taxpayers’ expense of course.

Finally, on the policy flaws, Clause 113 is completely unnecessary. The Committee stage of this Bill in the Lords brought out the extraordinarily wide scope of the powers the Secretary of State will acquire via the so-called fair work agency. This is, of course, just the Secretary of State under a different name. These include the powers to summon people to give information, to enter any premises to inspect and seize documents and examine computers, and even police powers to search, arrest and interview suspects in relation to labour market offences. Most people would assume that these sweeping enforcement powers will be more than enough to crack down on labour market abuse without a power to bring legal proceedings in the name of a worker who may not want those proceedings to be brought.

This is especially so given that Clause 114 provides that the Secretary of State can give legal assistance to a worker who wants to bring legal proceedings against their employer. This is surely the way this should be handled, rather than the Secretary of State unilaterally launching such proceedings in the belief that this is in the best interests of the worker. Perhaps it is in the best interests of the Secretary of State.

What happened to personal autonomy, especially the basic right to decide whether or not to bring legal proceedings in one’s own name? It could come as a bit of a shock for a worker, who might know nothing about the proceedings, to receive in the morning post a summons to court, especially when they realise they are treated as having brought the proceedings themselves and against their own employer to boot. Talk about choking on cornflakes.

It takes some mental agility to imagine how all this will also apply to a person who is not yet a worker but is seeking to be employed. It is hardly likely to endear them to their prospective employer, is it? If and when the worker does not get the job, they will have no remedy against the Secretary of State for ruining their chances.

This is a bad clause which fails on grounds of legal incoherence, practical unworkability and policy flaws. It needs to come out. I beg to move.

[Baroness Neville-Rolfe (Con)]

My Lords, I will speak to the amendment in the name of the noble Lord, Lord Carter of Haslemere. He has spoken with great eloquence and killer arguments. I agree with him, so none of us needs to speak for very long.

As he has said, this clause was added late in the day in the other place and there is one aspect which particularly appals me. The clause provides that the Secretary of State, or rather, in practice, their Civil Service agents in the new enforcement body, or any other enforcement officer as in Clause 113(7)(b), will be able to take a case to an employment tribunal where an employee is unwilling to pursue their own complaint—that is, without consent. Consent is such an important principle. Subsection (6) makes it clear that the Secretary of State or enforcement officer

“is not liable to any worker for anything done (or omitted to be done)”,

such as an error or reputational or personal damage. The clause also risks putting further pressure on the hard-pressed tribunal system.

The Government’s recent implementation plan seeks expert help in getting the detail of the provisions right. I have worked for small companies, I have worked for a company with 500,000 people, I have worked with USDAW, I have been a member of two Civil Service unions and I have been head of HR in a government department. I believe that this lack of consent will cause untold trouble. The clause must be dropped, and I hope colleagues across the House will vote for the amendment of the noble Lord, Lord Carter.

[Lord Murray of Blidworth (Con)]

My Lords, first, I declare an interest as a barrister who occasionally practices in employment law. Secondly, in Committee on 18 June, Hansard recalls that I described the Bill as

“a complete Horlicks … truly bizarre”

and

“absolutely beyond belief”.—[Official Report, 18/6/25; col. 2048.]

I am amazed at my moderation. Nothing I have heard since addresses my concerns. As ably outlined by the noble Lord, Lord Carter of Haslemere, whose amendment I entirely agree with, this clause allows the Secretary of State to bring a complaint to an employment tribunal without the consent of the complainant. Have these people ever been to an employment tribunal? This is absurd.

Is it proposed, in the event that the claimant has the temerity to disagree with the Secretary of State’s assessment that they have a valid claim, to witness summons the claimant, on pain of arrest, if they do not come and give evidence in support of their claim? If, when there, they have the temerity to give evidence against the claim brought by the Secretary of State on their unwilling behalf, will the Secretary of State apply to the judge to treat their witness as hostile, thus permitting the former to cross-examine the latter on the basis that they really were badly treated by their employer? This is palpable nonsense. This clause cannot stand part of the Bill.

I also draw the House’s attention to the fact that, as raised by the noble Lord, Lord Carter of Haslemere, the wording of the clause is an exercise in discretion and is therefore subject to judicial review. There can therefore be a judicial review of both the decision to bring proceedings on the part of the unwilling claimant and of the decision not to bring proceedings. This is going to be marvellous for those of us who are both at the employment Bar and the public law Bar. There will be endless litigation, all at public expense on every side. This is absurd. I invite the House to remove this clause from the Bill as swiftly as possible.

[Lord Pannick (CB)]

My Lords, I cannot match the peculiar tones of the noble Lord, Lord Murray, but I do agree with the thrust of his remarks. Noble Lords often oppose clauses in government Bills; sometimes noble Lords are alarmed by such clauses, but, very occasionally, it is appropriate to say that a clause in a government Bill is simply bonkers—a technical term, but appropriate in this context. That is the appropriate term in respect of a proposal that the Secretary of State should be given power to

“bring proceedings … in an employment tribunal”,

in place of the worker who has the employment right, where

“it appears to the Secretary of State that the worker is not going to bring proceedings”.

This is a quite astonishing provision, for all the reasons given by the noble Lord, Lord Carter, the noble Baroness, Lady Neville-Rolfe, and the noble Lord, Lord Murray, in particular because the Bill does not require the Secretary of State even to consult the worker whose rights they are going to pursue, far less to obtain the worker’s consent.

Of course, the worker may have good reason not to want to bring proceedings. Not everyone wishes to spend more time with their lawyers. Not everyone wishes to have the finer details of their conduct picked over in public by lawyers for the employer and to be the subject of a public judgment. I declare my interest as a practising barrister, occasionally in employment law cases. I spend much of my time advising clients in all areas of the law that litigation is not necessarily the answer to their problem. The idea that the Secretary of State should decide whether to bring proceedings, and not the worker themselves, could appeal only to those who believe in a state that is ever expanding to take more and more responsibility for areas of life.

21:00

What is the mischief that this provision is designed to address? The Minister clearly set that out in Committee. She said that

“vulnerable workers, especially migrant workers, are reluctant or unable to bring their case to the tribunal to enforce their employment rights”.—[Official Report, 18/6/25; col. 2052.]

Where is the research that supports this assertion, especially when trade unions provide legal advice and often representation to their members?

I suggest to the Minister that by far the most substantial reason why vulnerable workers are unwilling to bring proceedings to vindicate their rights in an employment tribunal is the absence of money—the absence of legal aid. There is no legal aid for an employment claim unless it alleges discrimination and even then the legal aid does not cover representation in the employment tribunal. That is why people are reluctant to bring claims. Clause 114 will certainly assist in that respect, as the noble Lord, Lord Carter, pointed out. But the idea that money should be spent by the Secretary of State bringing proceedings in his or her name is a remarkably inefficient and unsatisfactory way to proceed.

There are three other objections to Clause 113 that I will briefly mention. The first is that this clause is, so far as I am aware, unique in our legal system. I can think of no other context in which the Government have power to bring proceedings to vindicate the legal rights of an individual who has chosen not to sue—no other context in this country, at least.

The second point is that, if the Secretary of State is to have such a power in employment law, why not in landlord and tenant law? Why not in proceedings for debt? Why not in family law? There are many areas of the law where vulnerable individuals have rights that they do not enforce.

My final point, which has not been mentioned yet, concerns the financial cost of implementing Clause 113. Can the Minister tell the House what this will cost? This is important because there are so many urgent needs for funding in our legal system. The Government cannot afford to pay for more sitting days in the Crown Court, so rape trials are being listed for 2029. This is outrageous. Because there is no money available, courts up and down the country are in a state of disrepair, with some judges conducting hearings in courtrooms where the roofs are leaking rainwater into buckets. The legal aid system has been drastically reduced in scope—legal aid lawyers are not properly paid. The Government have not yet brought forward the much-needed Hillsborough legislation to protect victims of major tragic incidents because the Lord Chancellor has made it clear that she does not have the funding to pay for lawyers to represent those victims at inquiries.

It is quite simply a disgrace that, instead of meeting some of these urgent financial needs of the legal system, money is to be spent on this ill-conceived, unprecedented and inefficient scheme for the Secretary of State to become a professional litigant on behalf of workers. I very much hope that the noble Lord, Lord Carter, will divide the House. He will certainly have my support.

[Lord Garnier (Con)]

My Lords, there are several styles of advocacy and we have had a good experience of some of them this evening, but in every way those who have spoken before me have been devastating in their unpicking of the ludicrous nature of the clause that the noble Lord, Lord Carter of Haslemere, is seeking to have removed from the Bill. I cannot improve on the gentle forensic approach that he took to the ludicrous nature of this clause. The legal ramifications, its workability and its policy defects are plain on the face of the Bill and I am amazed that any sentient Minister—or any sentient member of any legislature—could come forward with a proposal in the form of Clause 113. It is manifestly absurd. As the noble Lord, Lord Pannick, thoroughly pointed out, the implications of this clause are so obvious for us all to see that it is even surprising that the Government have the nerve to come forward with it and maintain their support for it.

This clause brought me in mind of something—and now I am going to get into my anecdotage. I, too, remember the Bar, but I confess that I have never once, at least not knowingly, been in an employment tribunal. But what I do remember is that about 40 years ago I was asked by some visiting Chinese judges to this country to explain the English law of defamation, which I did. After I had given what I thought was a pretty uncontroversial explanation of the law of defamation in this country, one of the Chinese judges said to me, “Hang on a minute, do you mean to say that an individual has a reputation that can be injured and, if injured, he can receive compensation for that injury in the courts of England and Wales?” I said, “Yes, they can. It’s funny, isn’t it?” He said, “But surely no individual citizen, if there is such a thing, has a private reputation—it is subsumed in the interests of the state, subsumed in the Communist Party of China”. The possibility of bringing a libel action as an individual was just foreign to him and quite puzzling.

If your entire personality is a creature of the state, I suppose that you would support Clause 113, because it is the state that takes over your personal autonomy and makes all the decisions about whether to sue or not to sue, whether to bring proceedings or not to bring proceedings, and whether to give evidence, as my noble friend Lord Murray so graphically explained a moment ago. Why should we, on behalf of the people of this country, tolerate what is little more than an Orwellian intervention in the private lives of the citizen? I cannot believe that the Government have any decent excuse or explanation for this—to use the technical term that my good friend the noble Lord, Lord Pannick, introduced into the debate a moment ago—“bonkers” piece of legislation. The Bill has plenty wrong with it as it is. If we are not to laugh at the Government, not to ridicule the Government and not to lose such little respect as many of us still have for the Government, I suggest that they remove this ludicrous clause.

[Baroness Fox of Buckley (Non-Afl)]

My Lords, I hope that the devastating interventions that we have heard so far will make the Government rethink. They deserve the ridicule being poured on them. I just want to make two additional points.

Clause 113 completely undermines the Government’s idea that the Bill is all about enhancing workers’ rights by empowering them to have more control over their employment protections. When we scratch further, the real power is being accumulated by agencies and quangos; in this instance, it is the Secretary of State disguised as the fair work agency. It is an indication that workers are almost a stage army to the accumulation of power by the centre. I worry that the Government are using workers’ rights to colonise more aspects of people’s lives on the basis that the Government think that they can act on behalf of workers because they know better—that is outrageous. I want them to consider what this would mean for an individual woman at work. A female worker says no, but the Secretary of State comes up and says, “I don’t care; we don’t need your consent. You don’t want to go to a tribunal? We are not interested in what you as a woman think as a worker. We are going to act on your behalf because we know better than you”. It is an absolutely flagrant and outrageous attack on worker autonomy.

My other question relates to what the noble Lord, Lord Katz, said in Committee in response to a discussion about the overburdening of employment tribunals. He said that we will find that the fair work agency will pick up a lot of the work of the employment tribunals. The noble Lord implied that a lot of the work of the employment rights tribunals, which were clogged up, could be picked up by the agency and that fast-track routes would be used. I therefore cannot understand why, in this instance, the Government are piling more work on to the employment tribunals. They seem to be wallowing in this lawfare. If they do not want the Bill to be exposed as not in the interests of workers but more in the interests of quangos, this clause should be dropped before we come back.

[Lord Marks of Henley-on-Thames (LD)]

My Lords, I have not spoken on the Bill before and I apologise for entering these debates at this late stage. Indeed, I start by saying that I have considerable sympathy with the amendment moved by the noble Lord, Lord Carter of Haslemere, to leave out Clause 113. As he and others have said, it would enable the Secretary of State to take proceedings without the consent of the worker concerned, even against that worker’s will, which I agree is a very odd position.

I have considerable hesitation in doubting the analysis of all those who have spoken before me, eminent lawyers and colleagues among them, but I am bound to say that I take issue with the categorisation of this clause as “bonkers”. The reason I take that view is because, on reflection, I can see circumstances where the Secretary of State might legitimately wish to take proceedings before an employment tribunal where the worker concerned did not want to do so. That might be because the worker was concerned about the risk of losing, or did not have the time, resources or simply the inclination to become involved in contested proceedings.

[Lord Murray of Blidworth (Con)]

Perhaps the noble Lord could explain how it is envisaged that the Secretary of State will know that such a worker has a claim and should win.

[Lord Marks of Henley-on-Thames (LD)]

I do not understand why the Secretary of State should not have that information as a matter of public record, or why he should not have become aware of it. Plainly, if the Secretary of State and his department do not have the faintest idea about the case, they are unlikely to invoke Clause 113 and bring proceedings on that basis. However, given the knowledge, it is for the Secretary of State to make a decision. In very many cases, I suppose that the Secretary of State will make a decision against intervening. But another possibility is that a worker might not be proud of their own conduct and might not want it publicly ventilated. These were all reasons that the noble Lord, Lord Pannick, effectively covered in considering why litigation might not be an attractive option for the worker concerned. The Secretary of State has to make, or would have to make, a decision about whether the private right of the worker not to sue is outweighed by the public interest in having a point determined.

21:15

[Lord Pannick (CB)]

Is it really appropriate for a Secretary of State to insist that the circumstances relating to an individual are publicly exposed—subject to cross-examination, subject to a public judgment—when the individual whose private rights are the subject of those proceedings wishes, no doubt for good reason, that they not be so exposed? Is it really appropriate?

[Lord Marks of Henley-on-Thames (LD)]

I venture to suggest that in some circumstances it might be, but I add an important point, which is that my party has been involved in discussions with the Government about the protection of such a worker.

[Noble Lords]

Ah!

[Lord Marks of Henley-on-Thames (LD)]

There is nothing secret about any such discussions. They relate to anonymity for such a worker and the restrictions on publicity that might protect such a worker from exactly the dangers and difficulties that the noble Lord, Lord Pannick, suggests and envisages. But the Secretary of State might, in a given case, take the view that an issue of law or principle was involved, with wider ramifications going beyond that particular case, and that the public interest required the issue to be determined. With respect to all the arguments that have been put by those who have spoken before me, I am not sure that any of those arguments met that possibility, certainly not in the way in which the noble Lord, Lord Murray, expressed it. Even the moderate tones of the noble Lord, Lord Pannick, and the noble and learned Lord, Lord Garnier, a colleague of mine, failed to deal comprehensively with that suggestion.

[Lord Pannick (CB)]

This is a very important matter. Surely the answer to his concern that the individual case may raise wider, broader issues is that it is absolutely inevitable in those circumstances that there will be other affected workers, one of whom no doubt will bring proceedings. We do not need the Secretary of State to bring proceedings in those circumstances. It is inconceivable.

[Lord Marks of Henley-on-Thames (LD)]

There might be others. Then again, there might not. I quite accept that a Secretary of State would have to weigh up very carefully the competing considerations in favour of the public interest in having a point determined against the private interest of the worker concerned in not being involved in any way in litigation. Of course, the worker concerned does not have to be involved; proceedings are brought—this is a point I will come on to in a moment—as if he were involved, but the point may need determination in any case.

I think I have covered the point about the public interest, which I suspect is the argument that we will hear from the Government. Nevertheless, and on a point that the noble Lord, Lord Carter, made, in a case where Section 113 is invoked, I suggest that it would be utterly wrong for such a worker to be exposed to risk by the Secretary of State proceeding with such a case. I have dealt with the point about anonymity and circumscribing publicity, and I suggest that this must be addressed before this clause becomes law.

[Lord Garnier (Con)]

I am sorry for interrupting the noble Lord’s developing argument. He talks about anonymity; that is presumably so that the individual can have his case subsumed by the Government without his name being known. Is the noble Lord then going on to suggest that he will have to give evidence behind a screen, or using the other witness protection measures that we use in, for example, cases of rape, so that the complainant is not seen? Has he thought through to the end the practical consequences of this anonymity argument?

[Lord Marks of Henley-on-Thames (LD)]

Such protections as would be afforded would depend on the individual case and on such measures as the tribunal thought appropriate; they might indeed include anonymity or witness protection in an extreme case. I do not believe that that is likely, but I do believe that the right of the worker to some sort of privacy, in a case in which he positively did not want to be identified, would have to be protected.

Going on to my point about the risk in costs, I suggest that it would be simply unconscionable if the decision of the Secretary of the State to take proceedings could expose the worker to a risk in costs. There is no protection in the Bill for a worker on this point; indeed, in subsections (3) and (6) in particular, there is the clear suggestion that there would be a risk in costs for an unwilling worker claimant. Specifically, subsection (3) would provide that, if the Secretary of State brings such proceedings, they are

“to be proceeded with as if they had been brought by the worker”,

and that needs to be addressed. As the noble Lord, Lord Carter, pointed out, subsection (6) will provide that:

“The Secretary of State is not liable to any worker for anything done (or omitted to be done) in, or in connection with, the discharge or purported discharge of the Secretary of State’s functions by virtue of this section”.


That, in my submission, renders the worker vulnerable to an order in costs and there ought to be an indemnity against any such order. I accept that there is not one; the question is therefore whether that can be addressed by the Government. It is not a question that leads to a stand part decision that the clause should be left out of the Bill altogether.

We would of course hope that no employment tribunal would make a costs order against a worker in such circumstances, but this House should not proceed on the basis of hope alone; the possibility remains, particularly if the tribunal were to take a dim view of the worker’s conduct. That, we should remember, may be exactly the conduct that sensibly dissuaded the worker from launching proceedings in the first place.

I invite the Government to bring forward an amendment, hopefully by agreement at Third Reading, whereby protection from this risk in costs could be given to a worker, either by way of indemnity by the Secretary of State or by a prohibition on a costs order. I also urge the Government to look at the other protections that the worker might have. Alternatively, the Government might consider giving solid assurances to meet this point. I give way to the noble Lord.

[Lord Pannick (CB)]

Can I ask for the noble Lord’s assistance? He mentioned that, according to subsection (3),

“the proceedings are to be proceeded with as if they had been brought by the worker”.

Does he think that that means that if the worker decides to withdraw the proceedings, they are to be treated as withdrawn?

[Lord Marks of Henley-on-Thames (LD)]

The noble Lord has plainly given the Government solid pause for thought on that point, because of course any proceedings before a tribunal of first instance can be withdrawn by the litigants. The litigants in this case would be the Secretary of State and the other party—presumably the employer. If subsection (3) is given the interpretation that the noble Lord, Lord Pannick, suggests might be given to it, the worker would be treated as the litigant. That is a difficult point for the courts to resolve. It is a point that at Third Reading the Government really must resolve, and that I entirely accept.

[Lord Goddard of Stockport (LD)]

Follow that. I failed my Bar exam at 11 and I never retook it, so I am at a disadvantage to the House in trying to sum up the debate on this amendment. My noble friend Lord Marks made the case that this is not just an open-and-shut, bonkers piece of legislation; there is more to it.

Last week, I went for my health check, and I had my blood pressure and cholesterol checked. I recommend that the noble Lord, Lord Murray, keeps away from his doctor until probably next Wednesday, because his blood pressure will probably come down by then. That is meant in good spirit, because the noble Lord believed what he said and expanded on it.

For me, there is a different question here. This got a real going over in Committee too, where it all got a bit contentious with the lawyers. The noble Lord, Lord Pannick, always rises carefully and slowly and makes a forensic examination. Unfortunately, my noble friend Lord Marks tries to challenge that, and the noble Lord, Lord Pannick, has to have three or four more goes. However, we are not in the High Court, we are in the House of Lords, so we listen to the exchange.

The point that I am trying to make is that we have spoken to the Government. When somebody said, “We’ve spoken to the Government”, others went, “Ooh, no!” That is the point. There is the Bill and we should talk to the Government. We should raise our concerns with them and see what they have to say. But you do not do that because, “This is a good open goal. This is one we can really embarrass the Government with”. Well, you cannot—because the Secretary of State will have the power to look after somebody who needs looking after.

All those hundreds of years ago, when we had slaves, it was not the slaves who were petitioning to be freed; it was liberal-minded people who thought it was wrong that they should have no say and no place. That is what happens. Workers get jobs. They may be illegal or migrants, but whatever they are, they are human beings and they deserve support. Yes, the state is ultimately the last resort. When everything else fails—health, sickness, drug addiction or whatever it is—the state is the ultimate provider of care from the cradle. In my opinion, there is nothing wrong with the state saying—

[Baroness Falkner of Margravine (CB)]

My Lords, I too need to apologise to the House because I have not spoken previously on the Bill. I am therefore required, I am afraid, to add a few seconds of tedium in declaring my interest as chair of the Equality and Human Rights Commission. I am required to do that, but I emphasise that I am speaking tonight in a personal capacity.

I rise to question what was said by the noble Lord, Lord Goddard, and others who referred to the Government’s desire to protect those people who are vulnerable, who might be migrants or new arrivals, and who might not know their rights under the law. Of course that is a laudable aim. However, as someone who is a first-generation migrant—I came to this country in my own capacity—and who has slowly learned of my rights and my ability to exercise them, I can say to the noble Lord, Lord Goddard, that there is very good reason why those people need autonomy and privacy. They may not wish to be the subject of litigation because they have very palpable concerns about safety and their economic and familial status, particularly in a world with social media and high levels of media attention, if they are exposed as having done anything at all these days.

The reason that migrants and vulnerable new arrivals in our country keep a low profile, when they choose to do so, is very understandable. The idea that the state should pluck them, decide that they have been badly treated and use them as an example is pretty shocking and deleterious to their interests. It will not help them; they will hide under cover even more than they already do.

[Lord Goddard of Stockport (LD)]

I heard what the noble Baroness said, and I accept her premise. By the same rule of that premise, those people suffer or are treated badly until they become accepted in society and can then raise their heads above the parapet—if that is the logic of the argument the noble Baroness is trying to make to me. The noble Lord, Lord Marks, makes it quite clear that anonymity is absolutely four-square in this, so it does not happen that the media get hold of it or it appears on the networks and makes things different.

Where a case ends up with the Secretary of State and the evidence is there that somebody is in such a situation, why should the Government not intervene and say, “You have been treated so badly that we are going to stand up for you in a tribunal” or, “We are going to try to do something”? If you look at the bigger picture rather than the individual pictures, there is a way through this, without thinking that it is—this is the last time I will say it—a bonkers Bill. It is not bonkers. The theory behind it is sound. Perhaps it has not been explained clearly enough.

21:30

[Lord Murray of Blidworth (Con)]

How does the noble Lord envisage the Secretary of State knowing which cases to bring?

[Lord Goddard of Stockport (LD)]

I said at the beginning that I am not a legal person. But there must be something that will happen: a whistleblower or somebody will inform somebody of someone’s condition that they find intolerable, it ends up with someone and somebody has to deal with it. If you go to see the person and they do not want to get involved, are frightened, are unsure or do not know their rights, who scoops that person up and just asks the question? Maybe it is not worth pursuing, but what is wrong with just asking the question?

I ask the Minister to confirm this flexibility that we need to understand the powers. Will they be used proportionately and transparently? We need to hear that. The Government need to tell us how this legislation will work practically. If they can explain, and perhaps not allay all the House’s fears but begin to give some clarity to the thinking behind it, because this is something that has been thought out quite seriously, the House should listen to that.

[Baroness Fox of Buckley (Non-Afl)]

My Lords—

[Lord in Waiting/Government Whip (Lord Leong) (Lab)]

This is Report.

[Baroness Fox of Buckley (Non-Afl)]

I was just going to ask a question, as others did. As we are passing law, is it not the case that—

[Lord in Waiting/Government Whip (Lord Katz) (Lab)]

As it is quite late and we still have a lot of business to do, it is worth respectfully pointing out not just to the noble Baroness but to other noble Lords that the Companion is pretty clear about the rules of debate on Report. At 8.145 it states:

“On report no member may speak more than once to an amendment, except the mover of the amendment in reply or a member who has obtained leave of the House”.


We have a lot of business to go through. People have had the opportunity to state their case. Perhaps we should proceed with Front-Bench wind-ups.

[Lord Sharpe of Epsom (Con)]

My Lords, that was a fascinating debate. I am not a lawyer either, but I was very taken by the arguments made by the noble Lord, Lord Carter of Haslemere, which I thought were quite superb, by my noble and learned friend Lord Garnier and by my noble friend Lord Murray of Blidworth. I thought my noble friend Lord Murray displayed exemplary moderation—I think that was his word—in his delivery. I cannot improve on the legal arguments made by the lawyers, the noble Lord, Lord Pannick, my noble and learned friend and my noble friend. For a moment I wondered whether the noble Lord, Lord Marks of Henley-on-Thames, had—to use my noble and learned friend Lord Garnier’s phrase—subsumed his legal personality to be a creature of the state for a moment. He seemed to come back fighting, so I applaud him for that.

Frankly, Clause 113 is one of the most chilling and illiberal proposals in the entire Bill, and there is competition for that accolade.

Let us also consider somebody who has not been considered in this particular debate so far: employers. What sort of message does it send to them? Your employees’ silence cannot be taken as peace or resolution, but rather as a vacuum that the state may fill with litigation. The noble Lord, Lord Goddard, has a rather more touching faith in the state than I do. How does that promote trust or fair resolution in the workplace? I cannot see how it does. It would fuel paranoia, it invites conflict and it certainly undermines mediation. If a worker feels intimidated by their employer, as has been claimed before in these debates, do they really imagine that an employee will feel less intimidated by the prospect of a Secretary of State marching into their dispute, as the noble Lord, Lord Carter, stated, without any liability and then turning it into a tribunal case in their name? That is not empowerment; it is political theatre at the expense of personal agency. We should not accept or normalise that.

I have a question to those who have been pushing the argument about anonymity. I am not a defendant—or rather, I am not a lawyer; I may be a defendant—so I may have phrased this slightly incorrectly, but the defendant presumably will be known in these cases, and if the defendant is known, it is not especially difficult to find out who the plaintiff is. I think that is the correct terminology. So how on earth would granting an individual anonymity achieve the purpose that is desired? I do not get that—somebody would have to explain it to me.

This clause represents a fundamentally dystopian instinct that the state can somehow supplant the will of the individual and act on their behalf without their active participation or consent. I say to the noble Lord, Lord Goddard, that this is paternalism being taken to an authoritarian extreme.

In this debate we have heard “ridiculous”, “manifestly absurd”, “ludicrous” and “bonkers”—which I think won on a split decision. But there is one last point. The tone of this debate has been to invite both horror and ridicule in equal measure. Is that really what the Government want to achieve with this piece of legislation?

[The Parliamentary Under-Secretary of State, Department for Business and Trade and Department for Science, Information and Technology (Baroness Jones of Whitchurch) (Lab)]

The words that the noble Lord just said come from the Opposition Benches and do not reflect what we are intending by the Bill, or indeed these particular clauses.

I will first speak to government Amendments 156 to 158 in my name, which are minor but important technical amendments to Schedule 10. Amendment 156 makes a small correction to paragraph 36(6), replacing the phrase “that subsection” with a reference instead to “subsection (3)” of Section 15 of the Gangmasters (Licensing) Act 2004. Amendment 157 ensures that Schedule 1 to the Immigration Act 2016 is repealed following the abolition of the Director of Labour Market Enforcement, and Amendment 158 removes specific reference to paragraphs 9 and 11 of Schedule 3 to the Immigration Act 2016. The purpose of these changes is to ensure that the provision functions as intended and provides legal clarity. They do not alter the policy or substance of the Bill in any way but ensure that the schedule functions as intended.

On Amendment 154 tabled by the noble Lord, Lord Carter, the Government were elected on a manifesto pledge to deliver the plan to make work pay in full. This sets out that the new employment rights enforcement agency would have the power to bring civil proceedings to uphold compliance with employment law. This clause delivers that pledge.

The noble Lord, Lord Carter, referred to the precedent, and yes, the precedent that we are citing is the example of the Equality Act 2006, Sections 28 to 30 of which are the precedent for Clauses 113 to 115. Section 28 of the Equality Act enables the Equality and Human Rights Commission to assist an individual who is or may become party to legal proceedings. Section 30 of the Equality Act, which is the precedent for Clause 113, affords the EHRC the capacity to institute and intervene in legal proceedings, including for breach of EHRC rights, even though it is not a victim.

The noble Lord, Lord Carter, said there was not an example of where the EHRC had taken over a case. However, in the case of MS (Pakistan) v Secretary of State for the Home Department, the EHRC in fact substituted itself once the original appellant withdrew from the proceedings. This was a substitution, with the consent of the Supreme Court, by the EHRC in the same way that the fair work agency could substitute itself in place of a worker without their consent.

The EHRC uses Section 30 strategically to clarify the law and act where there are egregious breaches. We envisage that the fair work agency, rather than the Secretary of State as such, will use this power in Clause 113 similarly. Noble Lords have misrepresented what is intended by this clause. It is intended to address some of the worst employment practices that current regulations do not adequately cover. I agree with the noble Lord, Lord Marks, that there are of course cases where individuals or groups of workers are unable or reluctant to take a case, but that does not necessarily mean that the case should not be taken, because there are wider issues at stake. For example, the fair work agency could use the power to clarify entitlement to holiday pay where enforcement officers do not have enough information to confidently issue a notice of underpayment, or the fair work agency could exercise the power to clarify the employment status of a group of individuals. Currently, employers may misclassify workers as self-employed to get out of giving them the rights that they are entitled to. Without this power, the fair work agency has no ability to challenge such claims.

To give a specific example on the possible application of Clause 113, the Director of Labour Market Enforcement has flagged endemic bad practice in the hand car wash sector. A particular challenge in this sector is misclassification of workers, which stymies HMRC’s efforts to enforce the minimum wage. Currently, if a hand car wash claims that its workers are self-employed, HMRC has no means to test this in the courts. It must go through the full notice of underpayment process and wait for the employer to appeal against the notice of underpayment. This can lead to nugatory work if the appeal is upheld and otherwise delay workers getting their due rights. This is a gap in the existing system of state enforcement, which this power will go some way to remedy.

Just as the current system works, the fair work agency will take a whole-employer approach to enforcement. This has the advantages of a resolution for more workers than individual cases against the employer. But in such circumstances, where the fair work agency may be taking action for hundreds or thousands of workers, it is simply not practical to get consent from every individual concerned. As a strategic approach, this power will be used when acting in workers’ best interests to clarify the law. As with the EHRC’s powers under the Equality Act, the fair work agency will not need the consent of each individual concerned to take on cases. The fair work agency will therefore be able to decide when to seek clear, neutral and authoritative guidance from a tribunal on the application of employment legislation.

As we know, in the worst cases of serious exploitation, workers may be reluctant to give their consent due to fear of retribution from the employer. The noble Lord, Lord Goddard, was quite right to say that there are circumstances in which we have the responsibility to look after the individuals who are suffering at the hands of rogue employers and feel powerless in those circumstances. We know that many migrant workers with legal rights to work in the UK, particularly low- paid workers, are reluctant or unable to enforce their employment rights. These workers have understandable concerns, including fear of retaliation, lack of awareness or language barriers. For legal migrants, employment is their prerogative and, for those workers, there are wider implications in challenging an employer that could bring about repercussions for their employment or potentially impact on their visa. We believe that requiring consent from workers would make it easier for employers to attribute blame to individual employees, and they would suffer as a result.

[Lord Garnier (Con)]

My Lords—

[Baroness Jones of Whitchurch (Lab)]

I am going to carry on. When exercising this power—

[Lord Garnier (Con)]

My Lords—

[Noble Lords]

Order.

[Baroness Jones of Whitchurch (Lab)]

My Lords, we have had advice already about what the Companion says on this. The noble Lord has spoken once.

[Lord Garnier (Con)]

That is what the Government say, not the Companion.

[Baroness Jones of Whitchurch (Lab)]

I think that the Companion overrides anything that I have to say.

When exercising this power, the fair work agency will of course act in accordance with the rights under the European Convention on Human Rights, including Article 8, and comply with data protection legislation. In doing so, it must act in accordance with the law and for a legitimate purpose.

The noble Lord, Lord Marks, raised the issue of anonymity. In appropriate cases, the fair work agency will consider applying under Rule 49 of the Employment Tribunal Procedure Rules 2024. Rule 49 allows the tribunal to restrict public disclosure of aspects of the proceedings. That means that workers’ names can be kept from the public domain—

[Lord Garnier (Con)]

My Lords—

[Noble Lords]

Order.

[Lord Garnier (Con)]

My Lords, I can see that the Minister is in a conflict between the advice that she is getting from her Whip and the need to answer questions from the House. Would she not agree that rather than the Government bringing proceedings through their agency in the name of the worker, the simple thing would be to pass a law allowing the Government to bring proceedings in their own name, bearing the risks and burdens of bringing litigation in their own name and bearing the costs if it fails?

21:45

[Baroness Jones of Whitchurch (Lab)]

The point that we were making is that this is about test cases, which, as we know, is a frequent way of clarifying legislation, rather than primary legislation.

The noble Lord, Lord Marks, raised the issue of anonymity. In appropriate cases, the fair work agency will consider applying under Rule 49 of the Employment Tribunal Procedure Rules 2024. Rule 49 allows the tribunal to restrict public disclosure of aspects of the proceedings. That means that workers’ names can be kept from the public domain to protect their anonymity and to protect them from any reporting in the media, where it is necessary to do so in the interest of justice or to protect their convention rights. When deciding whether to give an order, the tribunal must give weight to the principles of open justice and the convention’s right to freedom of expression. The tribunal can do this on its own initiative, or the fair work agency can apply for such an order. The fair work agency must also comply with convention rights and data protection legislation, ensuring appropriate protections for individuals and fairness of proceedings.

I understand noble Lords’ interest in how this power will operate and confirm to the House that the Government will publish guidance on how the fair work agency will exercise this power in practice. We will develop detailed guidance, following deep and extensive engagement with social partners and the fair work agency’s advisory board. It will then be for the fair work agency, acting within this guidance, to determine which cases it brings to the tribunal. That will ensure that this power supports those who play by the rules. This approach enables the fair work agency to protect workers’ rights and to tackle injustice and abuse against legitimate workers.

This clause presents an opportunity to make a genuine difference in tackling the scourge of labour exploitation in the UK. Unchecked labour exploitation is unfair on the individuals who are being exploited. It is unfair on the majority of employers, who want to do right by their staff, and it is unfair on workers who are denied jobs by employers exploiting loopholes. The new power will complement the existing powers of the fair work agency, such as the powers to issue notices of underpayment, while enabling the fair work agency to act where these powers cannot be accessed. The fair work agency will exist to end labour exploitation and create a fair and level playing field for employers and for workers. A fair work agency with any less power to act for these most vulnerable would be an unacceptable failure for workers’ rights.

To the noble Lord, Lord Carter, I remain open to discussing how best to deliver this power and to ensure that it is appropriately safeguarded. However, I reiterate that this power is neither novel nor unprecedented and that it delivers a manifesto commitment. I therefore ask the noble Lord to withdraw Amendment 154.

[Lord Marks of Henley-on-Thames (LD)]

My Lords, I am sorry to get up again, but would the Minister like to say something about adverse costs orders against workers?

[Baroness Jones of Whitchurch (Lab)]

My Lords, when we debated this in Committee, we made it clear that there would not be any cost to workers. The noble Lord, Lord Carter, suggested that the worker would be liable to costs where they had not consented to the Secretary of State taking a case on their behalf. Let me be clear that the worker will not be liable for the costs in these circumstances.

[Lord Carter of Haslemere (CB)]

My Lords, I am grateful for all the powerful interventions we have heard this evening from very eminent speakers indeed, including the noble and learned Lord, Lord Garnier, the noble Lords, Lord Murray and Lord Pannick, and the noble Baronesses, Lady Fox, Lady Neville-Rolfe and Lady Falkner. Some really powerful points have been made around the importance of personal autonomy, the unworkability of the clause in relation to witness summonses and adverse witness results, and a duty to consult, which was a powerful point made by the noble Lord, Lord Pannick.

The noble Lord, Lord Marks, referred to the fact that the worker might not want to bring proceedings and therefore would be happy for the Secretary of State to do so in his or her place. That misses the point, which is that the worker might object to legal proceedings being brought in their name and might not give their consent. That is, for me, fundamental in this whole clause.

I believe that this is legally unprecedented—we can have further discussions about that. I think it is unworkable. I think it is completely unnecessary, given that the Secretary of State can support a worker to defend proceedings themselves. I read the manifesto and all I saw was “make work pay”. Those three words cover a multitude of sins. There was no mention of a power to bring proceedings on behalf of a worker—I read it very carefully. I feel that there has been enough power and passion in this debate to warrant seeking the opinion of the House, which I now do.

21:51

Division 5

Ayes: 85

Noes: 127

22:02

Amendment 155 not moved.

Schedule 10: Consequential amendments relating to Part 5

Amendments 156 to 158

Moved by

[Baroness Jones of Whitchurch]

156: Schedule 10, page 282, line 28, leave out “that subsection” and insert “subsection (3)”
Member’s explanatory statement
This amendment corrects an incorrect cross-reference.

157: Schedule 10, page 293, line 17, at end insert—
“(ga) Schedule 1;”Member’s explanatory statement
This amendment provides for the repeal of Schedule 1 to the Immigration Act 2016 as a consequence of the abolition of the Director of Labour Market Enforcement.

158: Schedule 10, page 293, line 19, leave out “9, 11,”
Member’s explanatory statement
The effect of this amendment is to repeal paragraph 10 of Schedule 3 to the Immigration Act 2016, which is not needed as a result of the repeal of paragraphs 11 and 12 of that Schedule by the Bill.

Amendments 156 to 158 agreed.

Clause 149: Increase in time limits for making claims

Amendment 158A

Moved by

[Lord Hunt of Wirral]

158A: Clause 149, page 149, line 32, at end insert “and provides for the early conciliation period to be extended from six weeks to three months”.
Member’s explanatory statement
This amendment will ensure that the early conciliation period is proportionate to the extended limitation period for tribunal claims. This is necessary to promote the early resolution of claims and to clearly convey that, from a policy standpoint, there is active support for avoiding litigation.

[Lord Hunt of Wirral (Con)]

My Lords, we now move to consider the employment tribunal system. I shall speak first to Amendments 158A and 158B. The Government are extending the time limit for individuals to bring claims to an employment tribunal, but if that is the case, and if, as the Government have repeatedly said, they value early conciliation and the vital role that ACAS plays in resolving disputes before they reach litigation, then surely the same principle must apply to the conciliation period itself. Extending the early conciliation period from six weeks to three months would provide claimants and employers alike with more breathing space to resolve matters amicably, reducing the burden on the tribunal system and promoting quicker, less adversarial outcomes.

I will also speak to Amendments 180 and 186. I will not repeat the arguments that I and many noble Lords across this House have already made about the state of the employment tribunal system, but let us be clear: the situation is now dire. We have spoken to a range of people involved in the system and hear the same message: employment tribunals are in disarray, with claimants waiting for up to two years for their cases to be heard. We believe that justice delayed is justice denied.

The Government say they are investing in tribunals, pledging to hire more judges and providing additional funding, so I hope the Minister will be able to answer these questions. First, how many new judges have been appointed? Secondly, what is the scale of the funding and how will it be allocated? Thirdly, will the Government also commit to hiring more administrative staff to ease the backlog? If so, how many? Until we have clear, credible answers to these questions, we believe it is simply irresponsible to bring forward clauses in this Bill that will place even greater strain on a system that is already buckling under pressure. I just hope that the Minister will have answers to these and other questions.

I will also refer to Amendments 186 to 188. We believe that there is this difficulty with the existing system and we have already seen the Government push back implementation of parts of this legislation to 2027. I do not know whether this is because they have at last had a moment of clarity and realised just how damaging some of these measures could be in practice. We now have an amendment asking to delay further until 2029. Frankly, this is not just reasonable; we believe it is necessary. A four-year delay might be the bare minimum to avoid the disasters which would otherwise be presented by this legislation.

Let us not pretend this delay is some kind of political foot-dragging on the part of the Government. To seek to delay implementation until 2027 of what was said to be a vital Bill is an admission that this legislation is deeply flawed and that rushing it through risks wreaking havoc on businesses, workers and the tribunal system alike. What is more, with the Government and the unions now seeming less like allies and more like wary rivals, this delay might be something the Government are willing to accept. I beg to move.

[Lord Katz (Lab)]

I am pleased to have a contrast in terms of debate length. It is good to hear from the noble Lord, Lord Hunt of Wirral. I will speak to this quite large group of amendments and, for the sake of brevity, try to cover as much ground as I can in time.

On Amendments 180 and 186. We recognise the concerns of the noble Lord, Lord Hunt of Wirral, over the employment tribunal system. I reassure noble Lords that we have heard the concerns of your Lordships’ House, the other place, and broader stakeholders representing employers and employees, and we are already acting. This includes recruiting more judges and legal caseworkers, and providing significant additional funding to ACAS for 2025-26. ACAS’s annual report shows that, of the approximately 125,000 early conciliation notifications received by it, approximately only 33% proceeded to employment tribunal claims.

I can try to answer some of the direct questions from the noble Lord, Lord Hunt, on the increased resources for the system. On new judges, 50 new fee-paid part-time employment judges were appointed in 2024-25 and a further three recruitment exercises to increase capacity are being undertaken in 2025 and 2026. I will reflect on Hansard and, if there are other questions on this I have not covered, I will of course write to the noble Lord.

As was pointed out earlier in the debate, we are also considering other areas such as the role the expanded fair work agency could play, where this would reduce the need for costly and lengthy tribunal claims. We are happy to receive further constructive suggestions from noble Lords on their ideas for reform, but we are of the view that it would be disproportionate to make the vital improvements to workers’ rights contained in this Bill dependent on the kind of review the Opposition propose.

Amendments 158A and 158B were also tabled by the noble Lord, Lord Hunt of Wirral. The suggestion about increasing the time for early conciliation is indeed constructive. As we have said previously on a number of occasions, we are engaging with businesses and unions to consider the ways to address growing demand and improve the efficiency of the employment tribunal system. Part of this work involves looking at how we can improve the already good work that ACAS is doing to help parties reach mutually agreed outcomes without the need for stressful and expensive litigation.

The six-week early conciliation period takes place prior to a claim being brought to the employment tribunal and provides an opportunity for employers and employees to try to reach an agreement without having to go to a tribunal. Increasing the time for early conciliation could provide some benefits to parties, but we need more time to consider how this would interact with other reforms and identify potential unintended consequences. Changes to the period of early conciliation can be made using secondary legislation and therefore it is not necessary to use primary legislation for this purpose. Perhaps the compromise I might suggest is that we will be happy to reflect on the suggestion that has been made as part of our wider work, and I thank the noble Lords and other colleagues for their amendments.

I turn next to Amendment 185, which was tabled by the noble Lord, Lord Sharpe of Epsom. The Strikes (Minimum Service Levels) Act 2023 unduly restricts the right to strike and undermines good industrial relations. It has proven to be ineffective and has contributed, one might argue, to industrial unrest. It is worth pointing out again, as we have already heard this evening, that no employer has ever issued a work notice under the Act and not a single day of strike action has been prevented since it was introduced. Indeed, reflecting on Questions earlier today, I repeat that we lost a record number of days to strike action in 2022 and 2023—the highest number since 1989, if I recall correctly. That Act definitely did not prevent more industrial action taking place.

Rather, we believe negotiation and co-operation are better ways to ensure that essential services continue during strikes, while respecting workers’ rights. For these reasons, we are committed to removing this legislation as soon as possible. Our commitment to repeal the legislation has been trailed for over a year. We made the commitment to make work pay, it was reiterated in our manifesto, and we announced it again in August last year, so it will not come as a surprise to any employer. As I said, in any event, employers are not using the legislation anyway.

Amendments 187, 189, 190 and 191 were tabled by the noble Lord, Lord Leigh of Hurley—he is not in his place—and the noble Lord, Lord Sharpe of Epsom. We have always said that we would engage and consult comprehensively on implementation to ensure that strengthened rights, protections and entitlements work for all. We want employers, workers, trade unions and others to have the time and space to work through the details of each measure with us.

On Amendments 187 and 189, I remind noble Lords that our road map, which the noble Lord, Lord Hunt of Wirral, referred to, sets out our plans for consulting on key provisions in Part 1 and Part 4 this autumn and into early 2026. We will then publish our response to each consultation, in line with published guidance. This will include a summary of responses received and a breakdown of the type of respondent. This reflects what we have already done in published consultation responses.

Through all these consultations, we will continue to engage with SMEs to ensure that their vital perspectives are fed into policy development, and we will provide sufficient support to prepare for these reforms. We value the constructive feedback and insights that such businesses and organisations give, and we will continue to prioritise engagement moving forward.

On Amendment 190, I remind noble Lords that, since 2016, there have been 33 reports and strategies on the effectiveness of labour market enforcement. I also remind noble Lords that the single enforcement body, regardless of the name, was a policy pursued by both the Opposition and the Liberal Democrats. Indeed, I believe that the proposal, under different titles, was in all three manifestos at the general election. So, whereas previous Governments have dithered and delayed in taking action, we are taking action to tackle the fragmented and ineffective enforcement system by bringing it all under one roof in the fair work agency.

22:15

Lastly, I turn to Amendments 188 and 192, tabled by the noble Lord, Lord Sharpe of Epsom, which concern commencement. We have always said that the Bill must work in practice, not just on paper. That is why we are committed to consultation and taking a staggered approach to implementation, as per our road map. These timelines have been carefully considered to ensure that implementation works for employees and businesses of all sizes, in all sectors. We are taking a measured and phased approach to implementation to ensure that the reforms are practical, workable and sustainable. I therefore ask the noble Lord, Lord Hunt of Wirral, to withdraw Amendment 158A on behalf of the noble Lord, Lord Sharpe of Epsom.

[Lord Hunt of Wirral (Con)]

My Lords, I am very grateful to the Minister for his response. I believe that he accepts that there is grave concern across the board about the state of our employment tribunal system today. That concern is among workers, employers and, especially, employment lawyers.

I welcome the fact that the Minister accepts that there is a need to extend the early conciliation period. He said that it could be done by secondary legislation; well, let us reflect on that. It would certainly help to reduce the pressure on the system, which is already under immense strain, but we lack clarity on some basic questions. How will employment tribunals be funded? There are so many question marks about how many further judges are needed and how many administrators will be appointed. What is the plan to bring the backlog under control? It is very serious at the present time. If rights cannot be enforced in court, they effectively do not exist. I urge the Government to take these concerns seriously and bring forward proper solutions. In the meantime, I beg leave to withdraw the amendment.

Amendment 158A withdrawn.

Schedule 12: Increase in time limits for making claims

Amendment 158B not moved.

Amendment 159 not moved.

Amendment 160

Moved by

[The Earl of Clancarty]

160: After Clause 150, insert the following new Clause—
“Independent Freelance Commissioner(1) There is to be an office known as the Office of the Freelance Commissioner.(2) The Office in subsection (1) must be established by the Secretary of State by regulations three months after the day on which this Act is passed.(3) The Office of the Freelance Commissioner will be led by an individual appointed by the Secretary of State titled the “Independent Freelance Commissioner”.(4) The role in subsection (3) is referred to as the “Freelance Commissioner”.(5) The Freelance Commissioner may appoint staff to the Office of the Freelance Commissioner they consider necessary for assisting in the exercise of their functions in subsection (6).(6) The Freelance Commissioner is responsible for—(a) representing the interests of freelance workers in the application of employment rights under this Act,(b) ensuring fair treatment of freelance workers across different sectors,(c) regularly engaging with sectors with high proportions of freelance workers about the application of provisions of this Act,(d) gathering and analysing data about the freelance workforce,(e) identifying issues and finding solutions to challenges faced by freelance workers as a result of provisions in this Act, and(f) ensuring that the duty to consider the freelancer workforce under section (Duty to consider freelancer workforce) of the Employment Rights Act 1996 is discharged properly.(7) The Freelance Commissioner must publish an annual report on the discharge of their functions set out in subsection (6) and lay this report before Parliament.(8) For this purpose of this section, a freelancer is defined according to section (definition of “freelancer”) of the Employment Rights Act 1996.(9) Regulations under this section are subject to the negative resolution procedure.”Member’s explanatory statement
This amendment establishes the office of the Freelance Commissioner and makes provisions for relevant duties and responsibilities.

[The Earl of Clancarty (CB)]

My Lords, I will speak to my Amendment 160, although I support all the amendments in this group. I declare an interest as a self-employed visual artist. Amendment 160 seeks to establish a freelance commissioner. It is closely tied to consequential Amendments 161 and 162, in the name of the noble Lord, Lord Clement-Jones, which seek to define what a freelancer is and to give the freelance commissioner greater teeth. I am very grateful for the support on this from the noble Lord, Lord Clement-Jones, and I welcome the support of my noble friend Lord Freyberg and the noble Lord, Lord Sharpe of Epsom, as well as that of my noble friend Lord Colville, who I know would have signed this amendment if there had been room to do so.

The first thing to say is that the creative industries welcome the appointment of a champion for this sector, as announced in the industrial strategy after Committee, and are pleased that that champion will be a member of the Creative Industries Council. These are things that the creative industries have been asking for for a long time, so there is appreciation that the Government have listened in this respect. Yesterday, I also had sight of the draft terms of reference—which is, of course, interesting timing. Those terms of reference, which are the result of conversations between relevant organisations and the DCMS within the framework of the Good Work Review, are impressive, if not yet entirely comprehensive, tasks and concerns. It is important to stress that this also illustrates the immense challenges a freelance champion will have. Nevertheless, I applaud the Government for opening the lines of communication between the DCMS and other organisations; long may that continue.

However, there remain questions concerning the champion. What powers will the champion really have, if any significant powers at all? Is this to be a salaried position? How much, in practice, will the champion be able to cut across different departments? Will this role be more about guidance for the sector rather than the really necessary action required for freelancers in terms of the many rights that standard employees have—and to a large extent take for granted—but that freelancers lack? I would be very grateful if the Minister could fill in some of those gaps if she is able to do so.

There are broadly two reasons why we should have a statutorily appointed and independent freelance commissioner. The first is that we urgently need someone to look at the whole landscape of freelance and self-employed work, which constitutes a not-negligible 15% of the workforce—and this is a sector that is growing. As my noble friend Lord Londesborough pointed out in Committee, this includes not just the creative industries but construction workers, agricultural workers and others. My amendment covers that landscape, one that the Bill—which is supposed to be an Employment Rights Bill, not an employee rights Bill—does not cover. Instead, as freelancers are always asked to do, we are told to wait in line. This of course happened during Covid, when so many freelancers fell through the gaps in support.

Even looking just at the creative industries, there is a question as to whether the whole of the creative industries themselves would necessarily be served by the new champion, in whatever guise that comes. The DCMS’s current understanding of these industries may be narrower than the reality, and this is certainly true of those craft industries—hugely important for our economy—that may not necessarily fall within the champion’s remit because of the manner in which parts of the creative industries are currently defined. This is something for the Government to look closely at, and I know that my noble friend Lord Freyberg intends to flesh out some of the detail of this very real concern about invisibility in both this and the debate that follows.

The second crucial reason for having a statutory appointment is not just that that role would have the requisite powers to argue for and effect real change, with the necessary authority to do so, but that it is a long-term position that cannot be rescinded easily because we are in this for the long haul. There is no doubt that freelancers’ concerns—this is certainly true of the creative industries—have grown more critical in terms of rights; income; the problems with late payment; Brexit, which has affected and continues to affect so many of our creative industries, not just music; AI, of course; and, crucially, the downturn in the funding of the sector. All these things have become immense pressures, which demand the appointment of an independent commissioner with the requisite powers to effectively address all these concerns and influence government policy.

I talked at some length in Committee about these increasing pressures as they affect the creative industries, and I will not repeat those arguments, except to add some conclusions from a survey to be published tomorrow by the organisation Freelancers Make Theatre Work—I am grateful for its permission to do so. It says:

“A striking headline in this year’s data is that 44% of respondents earned less than the 2024 UK National Living Wage in the 23-24 tax year … a significant worsening of the already critical situation from the previous year … where the equivalent figure was 34%”.


It goes on to say:

“These levels of pay would be illegal in salaried positions”.


I was worried by Chris Bryant’s recent evidence to the Culture, Media and Sport Committee, in which he said that he wants to see a reduction in the number of freelancers over the next 10 years. My understanding was that he is thinking about workers such as his mother, a make-up artist for the BBC, who lost their salaried jobs and were pushed into becoming freelancers. However, this is but one part of the landscape, and this exclusive emphasis ignores all the other freelancers, many of whom are creators—artists, writers, composers and many others—for whom there never has been any option other than being a freelancer for the work they do. Again, we need to understand the whole landscape—the reality of that landscape and the ecology of that landscape.

It becomes difficult to imagine how effective a champion with close proximity to the DCMS will be if the DCMS is actively trying to reduce the total number of freelancers—something it ought to be agnostic about. We need an independent commissioner—in other words, someone in a position of authority—who will support and, importantly, promote the practice of freelance work. We need it in law; we need it in the Bill. I beg to move.

[Lord Clement-Jones (LD)]

My Lords, it is extremely disappointing that we are debating something of this order of importance at this time of day and at the fag-end of this Bill. However, unusually, I shall try to ingratiate myself with the House by being as brief as possible.

First, I want to thank the noble Lord, Lord Katz, for his letter of 30 June and for the publication of the draft terms of reference for the freelance champion, referred to by the noble Earl, Lord Clancarty, who set out the stall extremely cogently for these amendments. I do not need to go over the ground that he has explained extremely well. The lack of a single clear voice representing the interests of freelancers to government is what this is all about—a clear definition of what a freelancer is and clear duties for the freelancer commissioner.

The freelance champion has some similar characteristics to the freelance commissioner, but there are significant differences from the independent freelance commissioner. It is not going to be a statutory office, unlike the freelance commissioner. The structure proposed in our amendments would be more permanent and more independent of government. The terms of reference explicitly state that the champion will focus on freelancers working in the creative industries only, so it will not be cross-sectoral. As we heard from the noble Lord, Lord Londesborough, it is clear that freelancers are extremely prevalent not only in the creative industries but in many other industries as well, including construction, professional, scientific and technical activities, business support, health and social work, IT, digital services and education and training.

While welcome, the freelance champion for the creative industries under the sectoral plan does not go nearly far enough across the board in making sure that there is a real advocate and one with teeth who is able to influence policy towards freelancers across all those different sectors. The question really is why the Government have failed to grasp the urgency and widespread nature of the challenges faced by freelancers across all sectors. It is not unclear that freelance work covers much broader areas than just the creative industries. These amendments would offer recognition to a workforce that contributes enormously to our economy and cultural life and is too often unprotected and unheard in legislative terms.

I urge the Government, even at this time of day and at this time in the Bill, when they cannot really change their approach, really to think about this. We have heard so much about how, on AI or dependent contractors, the Government are considering these things. They really need to shape up in terms of the modern economy. Freelancing is on the increase and they need protection—and the freelance commissioner would be by far the best way forward.

[Lord Freyberg (CB)]

My Lords, it is a pleasure to follow my noble friend Lord Clancarty and the noble Lord, Lord Clement-Jones, who have each set out the case for a more coherent and strategic approach to freelance policy with great clarity. I shall not repeat their arguments but will attempt to build on them.

I support Amendments 160 to 162, to which I have added my name, and I will speak to my own Amendments 163 to 165. I declare my interest as an artist member of DACS, the Design and Artists Copyright Society.

22:30

I join the noble Earl, Lord Clancarty, in welcoming, and thanking the Government for, the decision to appoint a creative freelance champion. It is a long overdue recognition of the vital role freelancers play in our cultural and economic life. However, I add a note of caution. As currently conceived, and as highlighted by the noble Earl and the noble Lord, Lord Clement Jones, the champion will be based within DCMS and will report directly to its Ministers, with strategic plans and annual reports subject to departmental sign-off. Although that structure ensures government engagement, it raises concerns about independence. Will this person, for example, have the freedom to speak plainly and critically when needed? How easily will they be able to make demands for change in other departments?

This concern is precisely why Amendment 165, which I will come to shortly, is so important. Without ministerial-level support and cross-departmental authority, even the most capable champion may find it difficult to influence policies that fall outside the remit of DCMS, such as tax, welfare or employment law.

A core issue underlying these amendments is the persistent lack of clarity around what it actually means to be a freelancer. This confusion is not merely semantic; it is real and has damaging consequences for rights, recognition and access to support. Amendment 161 from the noble Lord, Lord Clement Jones, makes a welcome contribution by offering a working definition of a freelancer. While that is an important first step, further work is needed, both legislatively and administratively, to ensure that there is consistency and a shared understanding across government and industry.

At present, “freelancer” is an umbrella term covering a wide range of working arrangements. Some freelancers are sole traders or self-employed individuals. Others operate through limited companies or umbrella organisations. Some are hired on a project basis, while others have ongoing engagements. A number may fall within the legal definition of a worker for the purposes of employment rights, but many do not. In the creative industries in particular, this definitional ambiguity is especially acute. Hybrid roles are common and career trajectories do not align with conventional employment models. The result is a fragmented and inconsistent policy landscape.

This ambiguity has significant implications. Artists and craftspeople often struggle to evidence their employment status when applying for universal credit, maternity pay or pensions. Creative professionals are regularly excluded from support schemes, particularly in times of crisis, because their work does not fit neatly into official categories. Public funding and policy decisions are made using distorted or incomplete data, as many freelancers are invisible in official classifications.

I will return to these issues in the next group of amendments, which address definitional gaps and classification failures, especially the limitations of standard industrial and occupational classification codes and the resulting invisibility of visual artists, craftspeople and others.

The central point is that, without clearer, more robust definitions and a co-ordinated policy response, we will continue to miss the mark. This is why a cross-departmental Minister lead is essential. A champion can listen, but only a Minister can act across the full machinery of government.

To turn to my own amendments, Amendment 163 would require the Secretary of State to produce a formal impact assessment on arts and cultural organisations within 12 months of the Act’s commencement. This is a matter of basic legislative prudence. Creative freelancers are disproportionately vulnerable to economic shocks. Creative UK reports that 66% lost work during Covid and only 4% felt that the benefits system met their needs. We cannot afford to introduce reforms without understanding their consequences.

Amendment 164 proposes the creation of an independent board to monitor the effects of the Act on cultural organisations, particularly those relying on freelance labour. This is not an unnecessary extra layer; it is a safeguard. As we have learned from SEND reform and the equality duty, legislative change works best when it is accompanied by structural review. Generic impact assessments simply do not capture the nuances of the cultural sector. A sector-specific review mechanism would allow Parliament to see, for instance, whether a funding model is forcing galleries to cut commissions or museums to drop freelance educators.

Finally, Amendment 165 proposes that the Prime Minister designate a Minister to be responsible for assessing and responding to the impact of this Act on freelancers and the creative industries. This is not about creating a new department or additional bureaucracy; it is about giving the existing structure clarity and focus.

Freelancers in the creative industries often fall between departmental silos. During the pandemic, they were initially excluded from the job retention scheme, not because of deliberate neglect but because no Minister was tasked with listening to them. A ministerial lead would reinforce the creative freelance champion, or commissioner, providing them with the necessary political backing to work across government. Without that support, we risk leaving the champion isolated, unable to influence areas that sit with HM Treasury, the Department for Work and Pensions, or the Department for Business and Trade. With new challenges on the horizon, from generative AI to the shifting boundaries of self-employment, this ministerial role will only become more vital.

In conclusion, these amendments are not designed to obstruct the Bill but to strengthen it. They seek to ensure that freelancers, particularly those working in the arts and cultural sector, are heard, supported and protected. I beg to move.

[Viscount Colville of Culross (CB)]

I declare an interest as a freelance television producer. Although I was not able to add my name to Amendment 160, my support for it is undiminished. Fortunately, I was able to add my name to Amendment 161, which I know would also give much needed clarity to freelancers.

Much of the creative industries’ employment, particularly in television, is in crisis. Hundreds of thousands of people working in the industry are unemployed, and many of them are freelance. Action needs to be taken now to protect some of the most skilled and experienced talent in this country. They need support in legislation, and urgently. The actions suggested in Amendments 160 and 161 would go some way to help their predicament.

Like my noble friend Lord Clancarty, I support the Government’s creative industries sector plan, which will set up a creative freelance champion. I welcome the Government saying that the champion’s role will be developed in discussion with industry. However, I have spoken to freelance advocates in various sectors of the economy and they all say that the champion’s powers need to be laid down in the Bill if they are to be effective.

I echo my noble friend Lord Clancarty in his concern about the powers of the champion. As it stands in the industrial strategy document, the champion will be giving out advice, which might make the Government feel good but will not definitively improve the lot of freelancers.

My fear is that the new champion will be nothing more than a data collector, whereas the problems of freelancers need to be addressed with decisive legislative powers. Their success will come down to the powers they wield. Noble Lords have only to look at the Office of the Small Business Commissioner. The outgoing commissioner, Liz Barclay, has done extraordinarily well as a vigorous campaigner for small business, but she has limited powers to mediate. She cannot make decisions, nor take enforcement action. I believe that proposed new subsection (6), to be inserted by Amendment 160, especially paragraph (b), would be some remedy when setting up the freelance commissioner.

The Good Work Review sets out a whole series of commitments to the self-employed, including badly needed strengthening of their rights to a written contract, action to tackle late payments, and extended health and safety protections, all of which are obstacles faced by freelancers and many of which cannot be tackled by the freelancer themselves without damaging their reputation and limiting their careers. Amendment 160 would give specific powers to the freelance commissioner to deal with this problem.

If the Government are not going to accept this proposal for a commissioner, I press the Minister on what kind of action can be taken to implement effective solutions in these areas. I am particularly exercised over the area of contracts. How will the new champion examine the myriad contracts in existence and the variety of issues they tackle? For instance, many freelancers are asked in their contracts to opt out of the Working Time Regulations so that they can work up to 15 hours a day and, on some days, 18 hours a day. This trend is increasing in the current climate of diminishing budgets and ever-tightening schedules.

This plays into one of the most pressing issues for freelancers: health and safety. Many big film and television productions set up discrete, single-vehicle companies solely for the period of the production. They often do not have an HR person or anybody who is concerned specifically with health and safety. These vehicles are dissolved once the production has ended so that there is nobody with long-term responsibility for what happens to a production team. As a result, so many companies create schedules in which 15-hour working days are becoming the norm, rather than the exception, as used to be the case. A freelance commissioner should be able to examine and stop these abuses.

The commissioner also needs to examine the financial issues faced by freelancers. The nature of their work has the advantage of flexibility and variety, but many disadvantages when it comes to pension provision. Most are covered when in work, but often there are lacunae between contracts which leave freelancers with poor pension provision. A commissioner needs to be able to sort out a hybrid pension product, like a lifetime ISA. This would give an option of adjustable contributions or those that could be paused, or consolidating retirement savings into a single annual event.

Just as importantly, the commissioner would need to champion professional career development. At the moment, there is so little training or continuous career development for freelancers. Successful training programmes would create qualified and technical staff for the industry. The solution should include tax relief, with a structural cap on expenses relating to career development.

Part of the problem in protecting freelancers is defining who they are. So many production workers operate on non-permanent contracts. They are technically classified as self-employed, but their working conditions do not support the definition. They cannot negotiate the hours nor send substitutes in their place, nor operate with genuine autonomy. The creative industries sector plan lists a range of self-employed categories which could be covered by the freelance champion—these were mentioned by my noble friend Lord Freyberg.

This brings us to Amendment 161. The noble Lords, Lord Clement-Jones and Lord Freyberg, set out many reasons why this amendment is crucial to ensure that freelancers are treated properly. Definition is crucial in so many areas of work in the creative industries, which once again brings me to highlight the lack of health and safety enforcement for freelancers. The Health and Safety at Work etc. Act 1974 says there needs to be adequate training of staff to ensure that health and safety procedures are understood and adhered to. Unfortunately, so many independent production companies regard only their small full-time core teams as staff, and not the majority of the production team, who are freelance and treated differently. One result is that the production company pays only for the core team to go on health and safety courses, and the freelance staff are forced to pay hundreds of pounds to fund themselves to go on the same courses, which are essential for the safe delivery of the production. Even when the production company does pay for freelance staff to go on these courses, there are problems. I have spoken to health and safety course providers who say the productions have asked them to drop the module on long working hours.

If Amendment 161 is accepted, the confusion over what constitutes “staff” would be clarified. Freelancers have problems with the IR35 status when HMRC claims that the freelancer is employed and so cannot benefit from the tax advantages of being self-employed. It can take time for a freelancer to prove their status.

I know that the Minister and the Government are on the side of freelancers, but we need to make sure that the freelance champion can do so much more than just deliver warm words. A freelance commissioner would have clearly defined, effective decision-making and enforcement powers. Only then will many hard-pressed freelancers be properly supported.

[Lord Parkinson of Whitley Bay (Con)]

My Lords, I support the noble Earl, Lord Clancarty, and others who have tabled amendments, and I congratulate them on persevering to Report on this important issue. Like the noble Lord, Lord Clement-Jones, I think it is regrettable that it has come so late, towards the end of term, but this is an important issue.

I welcome what the Government have done in appointing a freelance champion and look forward to the impact that that will have. However, as noble Lords on the Cross Benches have said, the proof will be in the pudding about this person’s clout and purchase, and their authority to speak across Whitehall.

The noble Lord, Lord Freyberg, spoke about the anonymity of many freelancers in the creative industries and the arts, and the noble Viscount, Lord Colville, talked about the way that they lose out in terms of their employment rights, including in some very serious ways that affect their safety. I will add a few words about my perspective, having been a Minister at DCMS, to note how they also lose out in the conversations that are had in Whitehall. When ministerial round tables are assembled, it is very easy for officials to gather the employers or the heads of trade unions who can speak on behalf of large numbers of workers. However, it is very difficult to find somebody who can speak on behalf of all freelancers; they are a more nebulous and disparate group of people, and they lose out in the conversations that are sometimes had.

There needs to be the understanding, which noble Lords have expressed, that, in parts of the performing arts and the creative industries, people work as freelancers not because it is a career choice but because it is a structural necessity of having a career in these rewarding sectors. It is also the case, when we ask people to help advise the Government, to sit on advisory panels or to take part in government commissions, that, if they do not have the safety net of a regular employer, they are not able to give as much time as those who are in more structured forms of employment can. They are therefore also losing out in terms of feeding into the policy-making conversations there.

It is important that the voices of freelancers, particularly in the creative industries and the arts, are heard. The questions about the clout and purchase that the new champion will have—particularly about whether this person will be paid and have some authority—are important. I congratulate the noble Lords on continuing with this important set of amendments.

22:45

[Lord Londesborough (CB)]

My Lords, I promise to be very brief. I support all the amendments in this group.

The arguments are building for the establishment of an independent freelance commissioner, mainly because the number of freelancers is growing and will continue to do so in the face of increasingly adverse conditions for both employers and employees. The current 2 million freelancers could easily grow to 3 million within the next 10 years, as employers continue to shed staff from payroll because they are weighed down by increased NICs, national minimum wages in excess of inflation, and some of the onerous new rules and regulations coming along in this very Bill.

I have argued that we could broaden out the need for an independent commissioner for the self-employed—who total about 4.5 million in this country, and the number is growing—but I will leave that issue to the next group, as it is addressed by my noble friend Lord Freyberg’s Amendment 167.

In conclusion, freelancers offer a great diversity of skill sets and flexibility in an economy that is suffering from stagnation and rigidity. They deserve greater recognition, and I implore the Government to take the proposal for a commissioner seriously. I absolutely agree with the noble Lord, Lord Clement-Jones, that we do not want a toothless, woolly token champion; we need an advocate with teeth—let us hope that that is what we will see.

[Lord Hendy (Lab)]

My Lords, no one hearing the speeches of the noble Lords who have spoken could be other than sympathetic to the objects of the amendments in this group.

However, although it may seem churlish, I have a point on the definition of freelancers in Amendment 161. It is not a technical point; it is about the fact that another categorisation of workers would be added to the already complex pattern of the status of workers. I know that the Government intend to conduct a comprehensive review of the status of workers later, and the issue of freelancers will no doubt be addressed in that.

One issue affecting freelancers, as defined in the amendment, is the use of substitution clauses in workers’ contracts. Two points arise here; my noble friend Lord Berkeley will say a few words about one, and I will deal with the other. The issue is that the insertion of substitution clauses by employers can be used to deny self-employed workers, such as freelancers, all employment rights. The particular value to some employers of this device was established in the Deliveroo case in the Supreme Court in 2023, in which I had the honour, or perhaps the misfortune, of representing the union representing the workers.

The issue is that self-employed workers are by definition not employees, and so they do not have the rights of employees. But they could be what lawyers call limb (b) workers, with limited employment rights. In order to fall into that definition, such workers must undertake

“to do or perform personally any work or services”.

The delivery companies have realised that this condition could be defeated by the inclusion of a right to substitute on the part of the worker. Clearly, a legal provision that such a clause should not be a factor in the determination of personal service is needed, but doubtless that will be a matter for consideration in the Government’s review.

[Lord Berkeley (Lab)]

My Lords, I will just add a few words to my noble friend’s contribution. This little item that we are discussing came out of a debate we had in Committee when we established that there was a link between the small boats with what we might call illegal immigrants coming across the channel and the delivery vehicles, mostly bicycles with trailers and mostly in London, but in other places as well. There was strong evidence that the riders do not have permission to work in this country and have probably not passed any of the tests necessary for what they are doing. We all know what the problem is with these bicycles and trailers going around London: they seem to forget that there are things such as traffic lights and rules about keeping to the left.

Ministers were sympathetic, and we had a very useful meeting with the Ministers, for which I thank them. The real problem is that once one of these drivers has a job at one of the companies my noble friend mentioned, they can contact their brothers, sisters and cousins on the continent and say, “Why don’t you come across too? You can share the job”, which sounds fine. They spend the money and come across the channel, hopefully still safe and alive.

Once two of them are trying to do the same job as if one person, it gets very difficult. There is no easy solution to this, apart from—we had a very useful meeting with the Minister on this—adding the word “substitution” to many of the issues that noble Lords in the creative sector spoke about so well earlier. They are often substituting for their brothers and cousins but are still working without the necessary insurance, certification or anything else. I hope that when my noble friend the Minister comes to respond, she will look favourably on the idea of having a wider interpretation of the type of work we are talking about. Apart from people not paying their tax and everything else, hopefully there are not going be too many road accidents, but at the moment it is a little dubious.

I am grateful to other noble Lords who have listened to something that is 100 miles away from creative, but it is just as important. I look forward to the Minister’s response.

[Lord Leong (Lab)]

Front Bench.

[Lord Goddard of Stockport (LD)]

No, I give up.

[Lord Hunt of Wirral (Con)]

My Lords, I do not believe that for a moment.

This has been such an important debate. I thank the noble Earl, Lord Clancarty, the noble Lord, Lord Freyberg, the noble Viscount, Lord Colville of Culross, and my fellow lawyer—not solicitor—the noble Lord, Lord Clement-Jones, for what has certainly been a long-standing advocacy on behalf of freelance workers. As my noble friend Lord Parkinson of Whitley Bay said, with all his experience as a Minister, there is no doubt that freelancers play a vital role in our economy and their interests deserve proper attention.

We on these Benches have also made the case that this issue is likely to become more urgent after the passage of the Bill. We cannot avoid the suspicion that the Bill is going to drive more workers into at least considering turning freelance. Time will tell, but as the noble Lord, Lord Londesborough, pointed out, the number could rise towards 3 million freelance workers.

We are all very grateful indeed to the Minister for organising an important meeting on this subject, because it was most useful. We welcome the Government’s intention to create a freelance champion, announced last month as part of the creative industries sector plan. That may be half a loaf, but it is a welcome enough commitment. We recognise the intent behind the amendment to establish a freelance commissioner, but at the moment, in the light of the assurances given by the Minister, we feel that the Government should have the benefit of the doubt for now, not least because we are not totally persuaded that the creation of another public body is the only solution.

What freelancers certainly need is clarity, simplicity and proportionate support. If the new champion can deliver that, all well and good. But we remain of the opinion, as came across in some of the contributions we had in Committee and just now, that socialists despise the very concept of freelancing. “How dare workers choose to avoid our elaborate structures?”, some of them say. So we will be watching with a very keen eye to see how this proceeds, particularly in the light of the speeches we just heard from the noble Lords, Lord Hendy and Lord Berkeley.

As we salute the expertise of the noble Earl, Lord Clancarty, on the creative arts, I take this opportunity to assure him that if he is unsatisfied that the Government’s measures adequately address the issues that have been raised, we will certainly be on his side. So I encourage him to remain vigilant and to keep the Government’s feet to the fire. In the meantime, we look forward with great interest to what the Minister will say in response to the many questions that have been raised in this debate, in particular about the urgency of this problem.

[Baroness Jones of Whitchurch (Lab)]

My Lords, I am very grateful to all noble Lords who have spoken in this debate. We have indeed had a very good debate, which once again has identified the significant contribution that the creative and cultural sector makes to our industries and our lives. The Government share your Lordships’ passion for supporting the creative and cultural sectors, and we previously spelled out in detail the significant work we are already doing in this area.

The creative industries and cultural sectors are a distinct part of the wider UK workforce. They have a significantly higher proportion of self-employed individuals, reflecting the sector’s entrepreneurial and freelance nature, which is one of the points that has been well made this evening. In the latest published data, as of 2023, there were 2.4 million filled jobs in the creative industries and 666,000 filled jobs in the cultural sector. Of these jobs, 49.6% in the cultural sector were self-employed, and 27.9% in the creative industries, compared with 14% of UK jobs overall. This reiterates the point that noble Lords have made about the significance of freelancers in the cultural and creative sectors. This flexibility not only drives innovation but supports the more project-driven nature of the creative industries. However, we also know that freelancers’ creative careers, while offering a more flexible and autonomous way of working, can also be precarious and come with lower job security.

23:00

I turn Amendments 163 and 164, in the name of the noble Lord, Lord Freyberg. As your Lordships’ House will be aware, we have already published a comprehensive set of impact assessments. This analysis was based on the best available evidence on the sectors likely to be affected by these measures, including the arts, entertainment and recreation industries. We recognise the importance of ensuring that the impacts of these policies on workers, businesses and the economy are considered, and that analysis is published online on this. We already intend to publish further analysis, in the form of both an enactment assessment when the Bill secures Royal Assent and further assessments when we consult on the proposed regulations. We are also committed to consulting with businesses and workers ahead of setting out the secondary legislation, including that affecting the arts and cultural sector.

I turn next to Amendments 161 and 162 in the name of the noble Lord, Lord Clement-Jones, Amendment 160 in the name of the noble Earl, Lord Clancarty, and Amendments 165 and 167 in the name of the noble Lord, Lord Freyberg, on freelancers. As we have been discussing this evening, the Department for Culture, Media and Sport has committed to appointing a freelance champion in the recently published creative industries sector plan, to give creative freelancers a voice within government. The freelance champion will be an independent voice for creative freelancers. In response to the noble Lord, Lord Parkinson, it will work in particular with industry to represent creative freelancers in fora with Ministers and officials in relevant government departments, identifying areas where freelancers are underrepresented—for example, in data collection—and to advocate for the sector’s freelancers within government. I hope that reassures the noble Lord. As we have heard, the terms of reference is in itself an impressive list of responsibilities, and I say to the noble Lord, Lord Hunt, that it is indeed more than half a loaf.

The sector is also working to address the recommendations of the Good Work Review, a deep dive into working practices in the creative industries that highlights freelancers’ job quality as a particular concern. My colleagues in the Department for Culture, Media and Sport are working with industry to understand government’s role in any solutions that can be developed by this group.

I know that we will shortly turn to a debate on employment status. Given that these amendments also relate to our work on employment status, I take this opportunity to share more information about the Government’s commitments in this area. As noble Lords will be aware, the Government are committed to consult on tackling the pressing issues with the existing framework for employment status. We have not given a specific timetable for this consultation so far because we know that the issue is important and complex, and we are keen to allow enough time to shape it in the right way. But it has been clear in today’s debate how important a step this is, not just for freelancers in the creative and cultural sectors but to people across the economy. I am pleased to be able to confirm to your Lordships’ House that we will publish our consultation on employment status by the end of this year.

I thank my noble friends Lord Hendy and Lord Berkeley for raising the issue of substitutions. We have heard the strength of feeling from many noble Lords on issues relating to employment status and fully agree that there are pressing issues within the current framework, such as the issue of substitution clauses, that need to be addressed. The issues with the existing employment status framework can enable exploitation at work and leave vulnerable people without core employment protections.

We will seek views on proposals to tackle these issues, to protect some of the most vulnerable workers. We are committed, in the plan to make work pay, to additional measures to strengthen protections for the self-employed. We intend to consult on these as part of the consultation on employment status. This will include addressing the health and safety issues mentioned by the noble Viscount, Lord Colville.

I recognise the complexities of the issues raised by noble Lords and understand that freelancers do not always fit into departmental responsibilities. However, it would not be right to pre-empt the employment status consultation by making changes for one particular industry of freelancers. Nor would it be right to introduce additional legal definitions at this stage. To do so risks making the system more complex for relevant individuals and organisations to understand.

We recognise the importance and urgency of taking these issues forward. I am happy to continue discussing how best to support the freelancers and the creative industries more widely. However, with this, I ask the noble Earl to withdraw Amendment 160.

[The Earl of Clancarty (CB)]

My Lords, I thank the Minister for that response, for the meeting that we all attended a few weeks ago, which was very useful, and, perhaps, for future meetings, because we want to know much more about what this champion will do. The Minister says that the champion will be independent. That is very interesting.

Three key themes have come out of this discussion. A number of noble Lords talked about whether the champion will be able to move between departments. This is really important. A number of noble Lords raised the question of visibility, including my noble friend Lord Freyberg and the noble Lord, Lord Parkinson, who talked about his insights into the visibility of freelancers. There is visibility and invisibility in a number of ways, which the Government must look at very carefully. There was also an interesting sub-debate from the noble Lords, Lord Hendy and Lord Berkeley. I was trying to work out how it fitted into the debate. It fits because this whole area is so interconnected. I take that on board.

Crucially, as we drafted in the amendments, the commissioner will have those powers and the authority to do what we worry that the champion will not be able to do and will be able to effect those changes. We wish the champion well. We hope that the champion will be able to do these things. This is an area that we will come back to, not least to see how effective the champion will be. For now, I beg leave to withdraw the amendment.

Amendment 160 withdrawn.

Amendments 161 to 166 not moved.

Amendment 167

Moved by

[Lord Freyberg]

167: After Clause 150, insert the following new Clause—
“Report: freelancers, self-employed persons and sole traders(1) Within nine months of the day on which this Act is passed, the Secretary of State must publish a report setting out—(a) fixed definitions of the following categories of workers—(i) freelancers,(ii) self-employed persons, and(iii) sole traders,(b) an assessment of how the categories of worker in subsection (1)(a) may be impacted differently by the provisions of this Act, and(c) recommendations to ensure fair and equitable treatment of workers across the categories in subsection (1)(a).(2) The Secretary of State must lay the report under subsection (1) before Parliament.”Member’s explanatory statement
This probing amendment seeks to clarify how the Government defines freelancers, self-employed persons and sole traders, and to understand how this Bill may affect those categories of worker.

[Lord Freyberg (CB)]

My Lords, Amendment 167 is in my name and that of the noble Lord, Lord Londesborough, whose support I am extremely grateful for. I will also speak to Amendments 177 and 178. Many of my points are likely to coincide with those to be made by the noble Lord, Lord Moynihan of Chelsea, on his Amendment 184A. However, his amendment takes a much broader view of the employment landscape than I do. I look forward to hearing his speech, and that of the noble Lord, Lord Clement-Jones, who will revisit the definition of the independent contractor.

Amendment 167 is a probing amendment that draws attention to the lack of consistent and widely accepted definitions of “freelancers”, “self-employed persons” and “sole traders”. These terms are often used interchangeably but carry distinct legal and practical implications.

A helpful approach would be for the Government to adopt a three-tier taxonomy, defining “freelancer” as a person who provides services on a project or contract basis, often to multiple clients, without being an employee. Amendment 161 from the noble Lord, Lord Clement-Jones, serves as an effective model for this, notwithstanding the comments by the noble Lord, Lord Hendy. The annexe in the draft terms of reference for the freelance champion, which I have seen, like the noble Earl, has also attempted to define a freelancer, which is a useful first step but by no means definitive.

A self-employed person is someone who runs their own business and is responsible for its success or failure, typically registering with HMRC for tax purposes. According to July’s House of Commons UK Labour Market Statistics report, self-employed people make up approximately 13.5% of the labour market, which currently has 4.43 million self-employed individuals.

A sole trader is a specific legal and tax classification in which an individual runs a business in their own name without forming a limited company. Although all sole traders are self-employed, not all self-employed persons are sole traders, and some may operate through partnerships or limited companies. Freelancers may span both categories, depending on their business structure.

The amendment also asks for

“an assessment of how the categories … may be impacted differently by the provisions of this Act”.

This provides an opportunity to examine disparities in access to employment protections, financial services, taxation and eligibility for public support. For instance, while a sole trader may more easily access certain types of finance or insurance, freelancers working intermittently across sectors often face barriers in securing mortgages, pensions, sick pay and other forms of welfare.

A government report could use illustrative case studies to clarify the lived experience of these categories—for example, contrasting the experience of a freelance illustrator, a self-employed plumber and a sole trader café owner. To ensure fair and equitable treatment across these groups, the Government may wish to explore options for harmonising entitlements and protections where possible. This might include developing portable benefits for freelancers, expanding access to contributory social protections or encouraging the adoption of freelance codes of good practice. The Creative Industries Council’s freelance toolkit is one model that could be promoted across sectors.

Amendments 177 and 179 raise closely related concerns regarding the visibility and classification of workers in the visual arts and craft sectors. These sectors often involve individuals working across multiple roles, such as creators, educators, curators and consultants, and frequently combine freelance and part-time employment in complex ways. Employment and legal status in these fields is therefore especially difficult to define clearly, which can leave individuals underprotected or misrepresented in government data and support schemes.

The Government could respond by convening a time-limited working group with representatives from relevant sector bodies, such as the Artists Information Company, the Crafts Council, Heritage Crafts, CVAN, DACS, the Cultural Policy Unit and Creative UK, to develop practical guidance on employment classification in the arts and crafts sectors. This could be an initial task for the creative freelance champion to prioritise early in their role.

Both amendments also highlight the significant limitations in how current standard industrial classification, SIC, and standard occupational classification, SOC, codes capture creative labour. For example, SIC code 9003 for “artistic creation” groups together visual artists, authors, composers and digital designers, obscuring the distinct needs and contributions of each group. SOC codes similarly fail to disaggregate fine artists, applied artists and craftspeople.

I understand that government departments may use a threshold of approximately 4,000 practitioners as a cut-off point for counting people working in various sectors—if the Minister could clarify this, it would be most helpful—as this approach would exclude virtually all heritage craft makers from official statistics. The Red List of Endangered Crafts includes 285 crafts, but not all of them are covered by the current SIC and SOC codes.

23:15

This statistical blind spot has profound consequences for sector recognition and support. DCMS currently counts only the manufacture of jewellery and related articles, SIC 32.12, in its creative industries economic estimates, capturing merely 7,000 employees, with a GVA of £800 million. This represents a staggering undercount when compared with the 2012 Mapping Heritage Craft study commissioned by BIS, which identified approximately 210,000 people working across 16 material-based categories, contributing over £4.4 billion in GVA.

This discrepancy illustrates how current classification systems fail to capture the craft sector’s true economic contribution. Many heritage craft practitioners work as sole traders or in micro-businesses, with 79% identified as self-employed in the mapping study. Their work often spans multiple activities—for example, a traditional blacksmith might combine restoration work, teaching and contemporary commissions—making classification under existing codes particularly challenging.

This statistical invisibility has created a funding desert for heritage crafts. While contemporary and design-led crafts receive support through the Crafts Council—some £2.2 million per annum via Arts Council England—which enables sector development, showcasing at events such as “Collect” and vital research activities, heritage crafts receive no equivalent government support, except minor grants. The sector must therefore rely on the now 13 year-old Mapping Heritage Craft research, leaving policy decisions based on increasingly outdated evidence and heritage crafts’ vulnerability to extinction largely invisible, until very recently, to policymakers.

The Government could commit to working with the Office for National Statistics and DCMS to review the suitability of SOC and SIC codes for creative occupations. This might include piloting revised classifications in labour market surveys, developing new survey modules in collaboration with other bodies and encouraging HMRC to refine its industry classification for self-assessment purposes.

In response to the spirit of these amendments, the Government could commit to publishing a report within 12 months, similar to that argued for in the amendment tabled by the noble Lord, Lord Moynihan, that outlines revised definitions for freelance and self-employed status, assesses the impact of legislation on these groups, explores data classification reforms and makes targeted recommendations to improve the fair treatment and statistical visibility of workers in the visual arts and craft sectors. This would be in keeping with the Government’s broader commitments under the creative industries sector vision and ongoing work to support the freelance workforce. I beg to move.

[Lord Clement-Jones (LD)]

My Lords, I am going to be extremely brief because it is now 11.20 pm. We need to finish these proceedings at least before midnight, but that may be an ambition too far. I declare an interest, as I should have done in the last group, as chair of the Authors’ Licensing and Collecting Society.

It would have been extremely useful to have inserted the speeches of the noble Lords, Lord Hendy and Lord Berkeley, because that is precisely what my amendment is all about. It is about ensuring that our employment law ensures the rights of a growing segment of our workforce. Our current system is based on statutory definitions and case law, and it settled on three categories: self-employed; worker—also known as limb (b), as the noble Lord, Lord Hendy, mentioned —or dependent contractor; and employee. However, determining whether an individual falls within this framework is often inconsistent and reliant on lengthy and expensive court cases, such as the landmark Uber v Aslam case. The Minister has extremely helpfully undertaken a consultation on employment status, and that is exactly what this amendment was designed to provoke, so I feel that to a large extent we have succeeded in pushing the Government further towards defining that kind of employment status.

I have had some useful conversations with Evri, which engaged in a legal case when it was under the name Hermes. As a result of its engagement with the GMB, it has come forward with what I think is an extremely interesting and satisfactory form of dependent contractor status that grants certain rights as if they were employees, and that is precisely what I hope this consultation will come up with in terms of family leave, entitlements, the right to request fixed hours and so on. The GMB, while awaiting formal policy setting through its democratic process, has expressed a positive stance towards retaining and reforming the limb (b) worker status. So I hope that the consultation that the Government engage in will not try to force everything into two categories but will make sure that that third category is recognised and given enhanced rights.

I think there was some misunderstanding in Committee in what the Minister said. She talked about complications and so on, and I hope that does not mean that what we are all trying to get to is two categories, employment or self-employment. I hope that the result of the consultation will be to come forward with some kind of dependent contractor status for precisely the kinds of people that the noble Lord, Lord Berkeley, was talking about—however fast they may go on their scooters.

[Lord Moynihan of Chelsea (Con)]

My Lords, I rise to introduce at this late hour Amendment 184A in my name. I refer to my registered interests as an employer and investor. I thank the many noble Lords on the Labour Benches who have kindly stayed to hear the noble Lords, Lord Freyberg and Lord Clement-Jones, and myself; it is very decent of them. The noble Baroness, Lady Jones, kindly committed just now to publishing the Government’s consultation on employment status, which relates strongly to the amendments that the three of us have introduced to this clause, and it is very welcome to hear that commitment. For me, that takes us half way to what my amendment proposes.

The Minister’s focus just now was on freelancers, while that of the noble Lords, Lord Freyberg and Lord Clement-Jones, was on both freelancers and the self-employed. My amendment focuses on protecting the self-employed and the so-called middle worker status, in particular for so-called platforms, which I will elaborate on briefly in a minute. I do hope to get your Lordships out before midnight; I will do my best.

The Government’s make work pay document, part of their manifesto, has, as we all know, made various commitments—or threats, as we call them on this side of the House—relating to workers’ employment status. Some are included in the Bill and some are promised for an unspecified future Bill or other kind of regulation. In particular, the employment status of worker, a middle stage between self-employed and fully employed, as just described by the noble Lord, Lord Clement-Jones, and as decided in the ruling in the Uber case, is to be reviewed, and there is the threat that that category will be tightened or even abolished. To date, the Government have said little else about its future although, in the Bill we are discussing now, Clause 1 on guaranteed hours and Clause 2 on shift contracts both significantly constrain what an employer can agree with an individual holding worker status.

It is depressing to note how the Government’s financial and regulatory policies are already hitting employment—the very topic of this Bill—not just in traditional areas such as pubs and entertainment, but in those advanced sectors where the economy’s hope for the future lie: AI or gene modification, for example, and now, in this Bill, the platform businesses that drive the gig economy.

Take driver platforms. In surveys, 76% of drivers say being self-employed is the key attraction; 60% of them value flexible hours above all else, rising to 72% among working parents. Nearly nine in 10 use multiple platforms to earn a living, which would be near impossible if rigid employment frameworks were imposed. A strong entrepreneurial spirit runs through the sector: 34% already see themselves as entrepreneurs and 49% aspire to be.

Platform companies such as Bolt, which has 100,000 drivers on its books, are currently at sea as to what the rules will be. Will they, because of all this, be forced to offer full employment packages to those who would rather be flexible worker employees? Will this then increase the platform company’s costs and lead to layoffs, as more hours have to be offered to these workers, leaving fewer hours available to the self-employed?

My amendment seeks to get a commitment to a formal review of all this—and we just got that from the Minister—in order to ensure that the Government stand by their stated intent to consult fully, and I think that word is key, before changes are made. Platforms need to know what future employment categories will be allowed and how they will be defined because, one way or another, all of this will lead to their having to make very significant changes to their platforms. It is important that the Government have a full review and consultation before they decide on their detailed approach.

Platform companies can and must form a leading part of our future economy. As the noble Earl, Lord Clancarty, the noble Lord, Lord Clement-Jones, and others explained, as was the case with freelancers, so it is with platform workers. All employers and employees agree that, in these areas, flexibility is key and the Government have elsewhere committed to reducing, not increasing, inflexible regulation. This amendment seeks to hold the Government to that commitment.

Platform employers are investing hundreds of millions in their activities per country, per platform employer, in other countries around the world, yet are not doing so here in the UK. One platform company recently contacted me to say that they had withheld £170 million of investment from this country precisely because of this Bill and the threats it imposes on it.

We are falling further and further behind other modern economies, and it is precisely because of ever-increasing taxes and regulation, and the threat of more to come, from this and future mooted Bills. Removing the middle-stage worker status would both increase unemployment and deter further inward investment.

My amendment seeks to hold the Government to account on their promises to consult on the expected outcome of this part of the Bill, which the Minister has just done, and to figure out the likely impacts carefully in the hope that the most detrimental potential regulations might not be imposed. As we go into the summer break, we already see employment, particularly youth employment, plummeting. The NIC increases, the now very high minimum wage and the fear created by this Bill are causing employers to hold off further employment. All of this is leading to less and less hiring. I ask the Government to have pity on the employer, to have pity on the self-employed and indeed to have pity on our economy overall by agreeing to this, I hope, helpful amendment.

23:30

[Lord Londesborough (CB)]

My Lords, I will briefly speak to Amendment 167 tabled by my noble friend Lord Freyberg, to which I have added my name. It is a thoughtful, pertinent and probing amendment which—dare I suggest at this late hour—the Government should embrace with enthusiasm.

I say this because we have often heard during what I think has been 13 days of debate on this Bill that the Government want equal workers’ rights to apply across the board, whatever the size of the business or sector and whether it is private or public. Whenever I and others have argued for exemptions, especially for small and micro businesses, there is a proverbial bucket of cold water thrown our way, accompanied by the message “We don’t want a two-tier workforce”. That view appears to be shared by the Liberal Democrats. I respect that, but I do not agree with it as it fails to recognise the multitude of tiers in the workforce that already exist.

This brings me to Amendment 167, which points out that we have several very important groups of workers that do not belong to this single tier, specifically freelancers, the self-employed and sole traders. There are key differences between freelancers and the self-employed, many of whom are sole traders or running their own businesses or partnerships with just one or two contractors. However, they are all treated by HMRC as self-employed and taxed the same way.

As my noble friend pointed out, the overall number we are talking about is 4.3 million and growing; that is approaching 14% of the workforce. Given the current dynamics of the jobs market, with falling vacancies in particular, an increasing number look set to join their ranks—whether or not they want to. That is why it is incumbent on the Government to fix the definitions, understand the numbers and assess how they are being impacted by the provisions in this Bill. The Secretary of State should think through how to recognise and treat freelancers, the self-employed and sole traders.

[Lord Hunt of Wirral (Con)]

My Lords, this has been a very important debate about employment status. I thank my noble friend Lord Moynihan of Chelsea for his important and thoughtful contribution to the debate. I also thank the noble Lords, Lord Freyberg, Lord Londesborough and Lord Clement-Jones, for their extremely important contributions.

As my noble friend Lord Moynihan rightly pointed out, the Government in their make work pay document have committed to consulting on a simpler employment framework—one that distinguishes clearly between workers and the genuinely self-employed. However, the reality is that platform workers and the innovative businesses that rely on them remain in the dark. There is no detail, no timeline and no clarity as to when or indeed whether these major reforms to employment status will materialise.

In the meantime, uncertainty reigns, and that uncertainty is not without cost. It risks holding back investment, stifling expansion and deterring new entrants into the UK market. We now hear so often from the Government about making the UK the best place in the world to do business, but a failure to provide clarity on the future of employment status, particularly in the growing platform economy, sends the opposite signal. The Government would therefore do well to heed my noble friend’s intervention. If they are serious about supporting flexibility, entrepreneurship and modern ways of working, then they have got to provide both the sector and the self-employed with confidence and clarity on what exactly lies ahead.

[Lord Katz (Lab)]

My Lords, I wish I had also brought my white hanky to the debate, but sadly I do not have that cop-out. This been a short but focused and interesting debate. I will begin with Amendments 177 and 179, tabled by the noble Lord, Lord Freyberg. The Government are well aware of the importance of accurate occupational categorisation, especially for those in culturally important occupations, and the noble Lord and I have separately discussed this issue and the complexities around it.

More specifically, we understand that some stakeholders feel the four-digit standard occupational classification—SOC—system is not detailed enough for their needs. To address this, in 2023 the ONS published an extended six-digit system that includes more accurate categories for groups like those mentioned by the noble Lord in his amendments. In addition to this, the ONS is now beginning work on the next update to the SOC system, which will be published in 2030.

I am afraid that I do not have some of the details on disaggregation, the levels of qualifications and so on that the noble Lord, Lord Freyberg, asked about, but I will undertake to write to him with more details. However, I would be very happy to facilitate contact between the noble Lord and the ONS team that is responsible for this work. He has demonstrated great interest and no little expertise in this subject area, and I am sure that they would appreciate his views and detailed analysis on the system, how it could be improved and how it could better reflect the complex ecosystem of craftspeople and other creative workers.

I turn to Amendment 167, again tabled by the noble Lord, Lord Freyberg, and supported by the noble Lord, Lord Londesborough, as well as Amendments 183 and 184A, tabled by the noble Lords, Lord Clement-Jones and Lord Moynihan, respectively. I hope that the noble Lords are reassured from the debate on the previous group that the Government take the commitment to tackling pressing issues with the existing employment status framework very seriously—and from the comments of the noble Lord, Lord Clement-Jones, I think that is the case.

As the noble Lords, Lord Moynihan and Lord Clement-Jones, said, consultation in the fullest sense is imperative on this issue. It will allow us to receive and consider the widest range of views and engage fully with relevant stakeholders, including those mentioned by the noble Lord, Lord Moynihan, in his amendment. Consulting on employment status was a commitment in the plan to make work pay, and as my noble friend Lady Jones outlined to your Lordships’ House in the debate on the previous group, today we are confirming that we will publish a consultation on this by the end of the year. As the noble Lord, Lord Moynihan, said, we will risk undermining the value of this work if we introduce new definitions without prior consultation.

The noble Lord also mentioned requiring an impact assessment of any legislative proposals brought forward as a result of this consultation. I can reassure your Lordships’ House that, in keeping with our better regulation requirements, we will produce impact assessments alongside any such legislation.

I hope this assures noble Lords that the Government are committed to consulting on employment status and are doing so with the care, focus and full engagement that this important issue requires. On this basis, I ask the noble Lord, Lord Freyberg, to withdraw Amendment 167.

[Lord Freyberg (CB)]

My Lords, I am very grateful to all noble Lords who have contributed to this thoughtful and wide-ranging debate. In particular, I welcome the announcement of the employment status consultation, which will be very helpful in looking at this matter in the round. I also am very grateful to the Minister for his offer to put me in touch with the ONS; I would be delighted to accept that and take it up at a later point. Given the lateness of the hour, I will not comment further. I beg leave to withdraw my amendment.

Amendment 167 withdrawn.

Amendments 168 to 177 not moved.

Amendment 178 had been withdrawn from the Marshalled List.

Amendments 179 and 180 not moved.

Amendment 181

Moved by

[Baroness Wolf of Dulwich]

181: After Clause 150, insert the following new Clause—
“Consideration of apprenticeships in consultations(1) In any consultation related to provisions in this Act, the Secretary of State must ensure that due consideration is explicitly given to the impact of such provisions on apprenticeships, specifically in relation to recruitment of young people by small and medium sized businesses.(2) For the purposes of this section, “small or medium-sized business” has the meaning given in section 7 of the Small Business, Enterprise and Employment Act 2015.”Member’s explanatory statement
This amendment seeks to ensure that the Secretary of State gives due consideration to the impact on apprenticeships in any consultation carried out in relation to provisions in this Act, such as the consultations proposed in the implementation roadmap: “Implementing the Employment Rights Bill: our roadmap to deliver change”, published in July 2025.

[Baroness Wolf of Dulwich (CB)]

My Lords, I will speak to Amendments 181 and 182 in my name and those of the noble Lords, Lord Aberdare and Lord Knight, and the noble Baroness, Lady Garden. I thank my fellow sponsors, and the noble Lord, Lord Londesborough, for so ably standing in for me in Committee.

Apprenticeship is central to this Government’s policies and to this country’s future. Yesterday, I had the privilege of being part of the Economic Affairs Committee’s annual session with the Chancellor of the Exchequer. One of the things she said—and I am quite sure truly meant—was that she wants more young people to get apprenticeships. Unfortunately, the Bill is likely to reduce, not increase, the opportunities for young people to become apprentices. I am absolutely sure that this was not intended by the Government, but we need to take note of it and start thinking fast about how to offset the impact.

Apprenticeship for young people is in a very poor state. As recently as 2008, 41% of apprenticeship starts were among young people aged under 19. This has now fallen to just 23%. Young people typically start off with what are called intermediate apprenticeships, but these are in decline too, both absolutely and proportionately—crowded out by higher apprenticeships, which are equivalent to university qualifications. The latest figures show a continuing drop, down from 162,000 intermediate starts in 2023 to 143,000 in 2024—that is a 12% fall in just one year.

Moreover, around half of our current starts now involve people who are over 25, and large numbers of these older apprentices were already working for their employer before they became an apprentice. This is especially true among the large employers, which account for a growing proportion of apprenticeships, whereas it is small employers which are more likely to take on young apprentices, and they who are decreasingly likely to do so. Moreover, the more deprived an area, the more likely it is that there will be no big employers— sure enough, the decline in apprenticeship numbers has been most marked in disadvantaged regions.

All this is happening against a background of many young people being in neither education, employment or training—NEET. I had seen a figure of one in 10, but the Chancellor yesterday referred to one in eight; whichever it is, it is far too many. So we need more openings for young apprentices. But there is a serious danger that the Bill will make large employers even more inclined to give apprenticeships to existing employees, with whose employment they take no risks, rather than hiring new young apprentices. Where employers do take on young people, they will play it very safe.

But what about the rest of young people? What about the young people who make up the growing number of NEETs? Small and medium businesses are the main employers of young apprentices. It is their apprenticeship recruitment which, as I have just pointed out and as was pointed out in Committee, has been plummeting in absolute and relative terms. Small businesses find our current apprenticeship regime burdensome and bureaucratic, and often too expensive: they do not have HR departments or lawyers on tap. At the moment, many feel under intense pressure, and business confidence figures reflect this. So, in this environment and in this context, giving young apprentices full employee rights from day one, with no provision of a probationary period, is a further turn of the screw. Taking on an untested young person is always risky, and the Bill would make it much more so.

I recognise that there is no simple way to make an exception for apprentices or to find a way that recognises that they are in key respects as much students as they are workers. Unfortunately, in this country, unlike many others, apprentices have no special legal status. In law they are simply normal employees who happen to have an apprenticeship training agreement. My noble friend Lord Aberdare highlighted this in his speech in Committee and, as so often, identified the key issue. This is still his last but one day, and at midnight it will become his last day in the House. He will be greatly missed.

At present it would be very difficult for the Government to make an exception for apprentices or treat them differently, and we need to change the situation as a matter of urgency and look to other countries’ apprenticeship laws for guidance. I also think that unless we get a clearer picture of how the Bill’s measures are impacting employers, especially small employers, we will not have a clear picture of exactly what needs to change and how. We need evidence and details, and that will enable us to see the best remedy. That is why we have tabled Amendments 181 and 182. I hope very much that the Minister will be able to respond positively and commit to monitoring the impact of the Bill’s measures, especially day-one rights, on employers’ willingness to employ apprentices, and especially on the situation with SMEs and young people. I beg to move.

23:45

[Baroness Garden of Frognal (LD)]

My Lords, it is very late and I will be very brief, but I want to associate these Benches with all that the noble Baroness, Lady Wolf, has raised. Apprenticeships should be for those starting out in working life. A level 7 apprenticeship is surely a contradiction in terms, but the perversity of the apprenticeship levy has meant that many employers choose to use their contributions on existing employees rather than face the possible problems and uncertainties of employing an untried and untested young person.

We need many more opportunities for employment for those young people who have been turned off by the academic programmes of schools. Many will have the very skills that the country needs but were not encouraged at school because the Conservatives stressed knowledge, not employability, and practical and artistic skills disappeared from many state schools.

The measures in the Bill for day-one rights for all employees will not encourage large or, particularly, small employers to take the chance on a youngster new to paid work. We have been encouraged by some of the words from Ministers, and we hope that they will look again at managing to exempt apprentices from these privileges and finding ways for employers actively to look for opportunities to enable the young not in education, employment or training to fulfil potential and make a contribution to the economy, instead of gearing up to a lifetime on benefits.

[Lord Aberdare (CB)]

My Lords, I put my name to the two amendments in the name of my noble friend Lady Wolf because I entirely share her concern that the Bill as drafted could have a damaging effect on apprenticeships, especially for young people and especially in small firms.

I am very grateful to my noble friend for her kind words, but I do not think that in this particular debate I would be greatly missed, because she and the noble Baroness, Lady Garden, have said everything that I could possibly have said—so I am not going to add a great deal to that. It is just as well that I did not choose 24 July as my departure date because, if I had, I would turn into a pumpkin at midnight and apparently we would have to adjourn the House for me to continue my speech—it has been done in the past.

I very much welcome the fact that the Government are undertaking some important consultations in this area, including on employment status. It is very important that they should look at the issues impacting apprenticeships for young people and in small firms, and they should, I hope, come up with some evidence for what sort of action might be needed to address those issues and prevent the kind of impacts that my noble friend described. That may well involve recognising, as so many other countries do, the fact that apprenticeships are a different form of employment from other forms and involve commitments on behalf of both the apprentice and the employer that will make undertaking particularly the day-one employment rights much harder to live with for the small firms involved.

With that, I encourage the Government to look very seriously at this and to consider the possibility of a separate legal employment status for apprenticeships. I will look forward to some sort of positive response from the Minister before I turn into a pumpkin—or wave a white flag, like the noble Lord, Lord Goddard.

[Lord Goddard of Stockport (LD)]

My Lords, very briefly, I was a bound apprentice for four years, from when I was 17 or 18 on a council estate outside Greater Manchester. Apprenticeships are a little jewel in the employment Bill that have somehow been missed. We need to advocate the opportunities for apprentices and the pride that apprenticeships give to young people, especially NEETs, and there should be no one better to do that than a Labour Government who are trying to generate income, prosperity and jobs. There is a little place there and, with more consultation—I have spoken to Ministers, who are mindful to be supportive of that—if we can get this right for apprentices and take away the obstacles to creating apprenticeships, more people will take them on.

Apprentices tend to stay with a company. If you are an apprentice and you have been trained for three or four years, you will tend to stay with that company and repay the loyalty they have given you in giving you a skill that will carry you through your life. So we support the sentiment and hope that the Government will say some kind words tonight, at least to stop the noble Lord disappearing at midnight and looking for Cinderella’s glass slipper.

[Lord Sharpe of Epsom (Con)]

My Lords, there is really very little to say, but obviously I thank the noble Baroness, Lady Wolf of Dulwich, for bringing forward this very thoughtful and necessary amendment. She is right that apprenticeships represent one of the most important pathways into skilled employment and a vital investment in our nation’s future workforce. I agreed with everything that the noble Baronesses, Lady Wolf and Lady Garden, and the noble Lord, Lord Aberdare, said, and I wish the noble Lord well. I hope that the noble Baroness, Lady Wolf, gets the reassurance that she needs and, if she does not, she should probably test the opinion of the House.

[Lord Leong (Lab)]

Good try.

My Lords, I am grateful to all noble Lords who have spoken. On behalf of these Benches, I wish the noble Lord, Lord Aberdare, all the best for his forthcoming retirement, which is not today; it will be on 31 August. We wish him well and he will definitely be sorely missed in this House.

I will address the amendments tabled by the noble Baroness, Lady Wolf of Dulwich. Amendment 181 proposes to insert a provision in the Bill to require that the Government give due consideration to the impacts on apprenticeships during consultation. Amendment 182 proposes a review process specifically on the impact on apprenticeships. Although these amendments rightly raise the importance of apprenticeships, they effectively duplicate what we are, and will already be, doing.

We know that our country’s greatest asset is its people, and apprenticeships are one of the most powerful ways, as stated by the noble Lord, Lord Goddard, that we can invest in that potential. They open doors, build confidence and provide a ladder of opportunity for those who might otherwise be left behind. Whether it is a young person taking their first step into the world of work or someone retraining for a new career, apprenticeships offer a route to success that is both practical and aspirational.

We are transforming the apprenticeship levy into a new growth and skills levy, giving learners and employers more flexibility. This will fund shorter apprenticeships and open up more tailored, responsive training options compared with the current system, where apprenticeships must run for at least 12 months. When we launch the consultations as described in the road map, every effort will be made to ensure that the consultations reach a wide audience. The Government are keen to hear from employers of all sizes and their representative organisations, as well as workers and their representative bodies, in order to understand the distinct perspective of these different stakeholders. They will play a crucial role in policy development. In developing options in our consultations, the Government will consider their potential impacts. The options analysts will, as is standard, consider the impacts on the labour market for different groups of workers and micro, small and medium businesses.

In addition, the road map shows that full implementation of the Bill will take years, so seeking to publish a review too early would prevent meaningful assessment of its effects, especially on young people.

The Government value apprenticeship, as I said earlier, and apprentices. We want to continue to engage with businesses that offer apprenticeship and encourage their contributions to forthcoming consultations, including on employment status, under the Bill. We will be happy to continue to engage with and meet the noble Baroness, Lady Wolf, to that end, and to listen to all young people and apprentices themselves.

These amendments are unnecessary and duplicative. Supporting young people and small businesses will already be at the forefront of our minds as we work to implement our reforms. I therefore respectfully ask the noble Baroness to withdraw Amendment 181.

[Baroness Wolf of Dulwich (CB)]

My Lords, I thank the Minister for his words and definitely accept the invitation to continue to talk to the Government about this issue and about how we might improve the current legal framework so that it encourages apprenticeships in a much more positive way. I totally accept that the Government are doing a large number of consultations already, and I am delighted to know that in that context the Minister thinks that our amendments are unnecessary, since that would imply that they are definitely going to look at apprenticeships. On that basis, with thanks, and looking at the time, I beg leave to withdraw the amendment.

Amendment 181 withdrawn.

Amendments 182 to 184A not moved.

Amendment 184B

Moved by

[Baroness Bennett of Manor Castle]

184B: After Clause 150, insert the following new Clause—
“Review of the impact of high temperatures on workplace health and safetyWithin 12 months of the day on which this Act is passed, the Secretary of State must publish a review of the impact of increasing temperatures on workplace health and safety.”Member’s explanatory statement
This amendment seeks to ensure the Government is considering the impact of increasing temperatures due to climate change on the safety and health of workers.

[Baroness Bennett of Manor Castle (GP)]

My Lords, aware of the hour, I begin with a promise that I will not test the opinion of the House, although I am afraid that I cannot speak, of course, for the numbered amendments after this one.

Just to explain very briefly—it is fairly self-evident—my amendment calls for a new clause to review the impact of high temperatures on workplace health and safety. Of course, this is in consideration of the rising issue that this presents for the rights of workers in the climate emergency. I did not table a comparable amendment in Committee. I tried to table a broader amendment which was ruled out of scope and I never managed to get back to it, but I feel it is really important to bring this amendment here today, in light of events between Committee and Report.

Noble Lords may be aware of a novel by Kim Stanley Robinson called The Ministry for the Future, which features a mass mortality event as a result of extraordinary high temperatures and humidity. If we ever get to that stage in Britain, we will be beyond deep trouble. None the less, what we have just experienced at the end of June is what one expert described as a “quietly devastating” heatwave across Europe, which killed 2,300 people in 12 major cities and, it is estimated, will have caused several hundred deaths in London alone. The climate emergency means that, through that period, the temperatures were four degrees higher than they would have been otherwise, and one of the important things that has happened is that we have seen a large increase in so-called tropical nights, when the temperature does not drop below 20 degrees centigrade, people struggle to rest and that then has a cumulative effect on workers’ health.

We have not just seen the heatwave. We have also seen the TUC launch a large-scale, serious campaign to ask the Government to look at this and, in fact, to go further and set a maximum working temperature. It is worth stressing that, unlike other countries such as Spain—which might not surprise noble Lords—and Germany, we do not have a maximum working temperature. There is an obligation on employers to provide a safe workplace, but without that maximum temperature, and with circumstances arising that neither workers nor employers have encountered before, we really need to set some guard-rails for the safety of workers.

The TUC did a recent study on this and produced some horrifying examples, starting with what is happening in schoolrooms. It surveyed almost 6,000 teachers; some 94% reported they worked in excessively high temperatures during the summer, with 42% doing so regularly. A union rep reported on 27 telephone exchanges, in which the highest temperature was 36 degrees centigrade. A chicken factory reported high temperatures leading to incidents of tiredness and dizziness in a place where there was a lot of hard physical activity—that sounds like hell. In tissue culture and virology rooms, the temperature was 32 degrees and the room was full of ethanol fumes, which is another issue all to itself.

I am acutely aware of the hour, but I hope I will hear from the Minister that this is something that the Government will look at very seriously and consider the TUC’s call for a maximum temperature. That would obviously vary according to the circumstances. When we think about working outside, we have the issue of sun exposure, which also has longer-term risks for health and skin cancer, et cetera. I hope that I will hear something positive from the Minister and that the Government will take this seriously, listen to what the TUC is saying, acknowledge that the climate emergency is making this a fast-rising problem and take action. I beg to move.

[Baroness Jones of Whitchurch (Lab)]

My Lords, I am grateful to the noble Baroness, Lady Bennett, for tabling Amendment 184B.

We recognise that workplace temperatures are changing, especially as the climate changes. We are committed to ensuring that workplaces are safe in the modern world, and we committed in Next Steps to Make Work Pay to look at how to modernise health and safety guidance for extreme temperatures.

The Health and Safety Executive is Britain’s national regulator for workplace health and safety. It is dedicated to protecting people and places, and helping people lead safer and healthier lives. To deliver on our commitment, the HSE is reviewing the approved code of practice for the Workplace (Health, Safety and Welfare) Regulations 1992 to ensure it is fit for purpose for a modern workforce. This includes monitoring emerging evidence around the impact of extreme temperatures on workplaces. The HSE will bring forward detailed proposals on workplace temperature in due course and there will be an opportunity to comment, which I encourage the noble Baroness and others to respond to.

I assure the noble Baroness that the workplace regulations currently require that, during working hours, the temperature in all workplaces inside buildings should be reasonable. All employers must make a suitable assessment of the risk to employees and take action where necessary. This includes assessing the risk from heat stress. The Environment Agency has also issued guidance on how employers can plan for climate change impacts to their sites of work and integrate climate change adaption into their management systems. Nevertheless, I hope this broad scope of work, which is currently under way, provides the noble Baroness with the reassurance that this is a matter that we already recognise as important, and that we are actively taking steps to address the impact of increasing temperatures on health and safety at work.

Before we conclude this group, my noble friends Lord Leong and Lord Katz and I would like to thank your Lordships’ House for the extensive and energetic debates that we have had throughout Report, as well as its continued engagement and scrutiny. Indeed, we have held over 50 engagements with noble Lords since the Bill came here from the other place, excluding the debates here in the Chamber.

This Bill will benefit 15 million people—half of the UK workforce. We were elected with a manifesto commitment to make work pay, and the Bill is a vital step in delivering that commitment. With that, I ask the noble Baroness, Lady Bennett of Manor Castle, to withdraw Amendment 184B.

[Baroness Bennett of Manor Castle (GP)]

My Lords, I thank the Minister for her response. The problem is that words such as “reasonable” and “assessed risk” refer to what may happen in well-regulated, well-controlled workplaces; in contrast, it is the most vulnerable workers who are the most vulnerable to that not happening. However, many of the cases I cited were very mainstream workplaces, such as schools.

As promised, I will withdraw my amendment. Before doing so, I finish with an apology to the staff. We should give thanks to them for supporting us right through the Bill and throughout all the time it has taken. I also note that we should think about the impact of heat on their health and well-being in our workplace. We might want to think, as employers ourselves, about what reasonable adjustments we might need to make for them, as the temperatures in this workplace change. I beg leave to withdraw the amendment.

Amendment 184B withdrawn.

Clause 156: Commencement

Amendments 185 to 193 not moved.

Amendment 194 not moved.

[Lord Katz (Lab)]

My Lords, with thanks to the clerks, the doorkeepers and all the staff of the House for staying so late, I beg to move that the House do now adjourn.

House adjourned at 12.05 am.