Employment Rights Bill

Baroness Jones of Whitchurch Excerpts

Report stage
Monday 21st July 2025 Lords Chamber

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

My Lords, I will begin with Amendment 111ZA, moved by the noble Lord, Lord Clement-Jones, and Amendments 168, 169, 171, 172, 175 and 176, tabled by the noble Lord, Lord Holmes, whom I thank for his engagement on these important issues.

I start by reassuring all noble Lords that we agree that AI should be deployed and used responsibly, including within the workplace. As the noble Lord knows, in January 2025, we published the AI Opportunities Action Plan, which included a commitment to

“support the AI assurance ecosystem to increase trust and adoption”

of AI. One of the key deliverables in this area is the AI management essentials tool. We are developing this tool to support businesses, particularly SMEs, to implement good AI governance practices. Following public consultation earlier this year, I hope to update your Lordships’ House on the consultation response and an updated version of that tool soon.

Regarding these amendments, I remind noble Lords that our plan to make work pay makes it clear that workers’ interests will need to inform the digital transformation happening in the workplace. Our approach is to protect good jobs, ensure good future jobs, and ensure that rights and protections keep pace with technological change.

To be clear, we are committed to working with trade unions, employers, workers and experts to examine what AI and new technologies mean for work, jobs and skills. We will promote best practice in safeguarding against the invasion of privacy through surveillance technology, spyware and discriminatory algorithmic decision-making. In response to the noble Lords, Lord Freyberg and Lord Hunt, of course we will put ethics and fairness at the heart of that.

I am keen to stress that we are taking steps to enhance our understanding of this area. This has included engagement and round-table events with a wide range of stakeholders and experts to help enrich our understanding. I reaffirm that we will consult on the make work pay proposals in due course.

The noble Lord, Lord Clement-Jones, asked what would be in the scope of the consultation. The consultation plan includes examining: what AI and new technologies, including automation and AI, mean for work, jobs and skills; how to promote best practice in safeguarding against the invasion of privacy through surveillance technology, spyware and discriminatory algorithmic decision-making; and how best to make the introduction of surveillance technology in the workplace subject to consultation and negotiation with trade union or employee representatives.

The noble Lord, Lord Holmes, asked whether or not this was going to be domain-specific. As the noble Lord, Lord Hunt, just reminded us, this was dealt with in an Oral Question earlier this afternoon, when my noble friend Lord Vallance said that existing regulators will oversee most AI systems, supported by enhanced AI skills and cross-regulatory co-ordination through forums such as the Regulatory Innovation Office. Some cross-cutting issues will be addressed also in the planned consultation on AI.

Looking specifically at Amendment 171, let me reassure the noble Lord that we believe that data protection legislation provides sufficient protection for workers and individuals where their personal data is being used in line with the key data protection principles, including lawfulness, fairness and transparency. Consent is a lawful ground to process personal data. However, due to the power imbalance between the employee and employer, it is often inappropriate for employers to rely on consent from employees to process their data. This is why we have an additional lawful ground to carry out such processing, such as legitimate interest under the data protection law. Therefore, we do not wish to limit data processing in these situations to consent alone. I also point out that while data protection principles establish the requirements that we expect the use of AI systems to adhere to, AI assurance provides ways to evidence that these requirements have been met in practice.

Amendment 170 tabled by the noble Lord, Lord Holmes, would require workers and employers to maintain records of data and intellectual property used in AI training and to allow independent audits of AI processes. As he will know, this issue was debated extensively during the passage through your Lordships’ House of the Data (Use and Access) Act 2025. Only last month I confirmed that we will publish a report, including on transparency in the use of intellectual property material in AI training, within nine months of Royal Assent to the Act, which will be due by 18 March next year. The Government have also committed to setting up expert stakeholder working groups to help drive forward practical, workable solutions in this area, alongside a parliamentary working group to engage with policy development.

Amendment 174 tabled by the noble Lord, Lord Holmes, proposes a review of the use of AI in recruitment and employment. As the noble Lord will be aware, last year the previous Government published detailed guidance on responsible AI in recruitment, which covers governance, accessibility requirements and testing. This was developed with stakeholders and relevant regulators, such as the Information Commissioner’s Office and the Equality and Human Rights Commission. Employers and recruiters may find this guidance useful to help integrate AI into their recruitment practices in a responsible way.

Furthermore, I am excited about the opportunities of AI in supporting the UK’s workforce, as well as creating jobs and growing our economy. However, we must also understand how it may affect the labour market, including any potential disruption. The AI Security Institute has begun assessing this issue, and I hope to be able to update your Lordships’ House on this as work progresses.

Regarding our position on general AI regulation and the establishment of a new AI regulator, we believe that AI is best regulated at the point of use by the UK’s existing sectoral regulators. As experts in their sector, they are in the best place to understand the uses and risks of AI in their relevant areas, and we will support them to do this. I emphasise that in response to the AI Opportunities Action Plan, we have committed to supporting regulators in evaluating their AI capabilities and understanding how they can be strengthened. I assure your Lordships’ House that we are committed to making sure that workers’ interests inform the digital transformation taking place in the workplace.

I am grateful to my noble friend Lord Pitkeathley for raising non-compete clauses. There has been extensive research and analysis in recent years looking at the prevalence of non-compete clauses in the UK labour market and their impact on both workers and the wider economy. Government research published in 2023 found that non-compete clauses were widely used across the labour market, with around 5 million employees in Great Britain working under a contract that contained a non-compete clause, with a typical duration of around six months. As my noble friend identified, this can adversely impact both the worker affected, through limiting their ability to move between jobs, and the wider economy, due to the impacts on competition.

It is often assumed that non-compete clauses are found only in contracts of high earners. However, research published last year by the Competition and Markets Authority found that while non-competes are more common in higher-paid jobs, even in lower-paid jobs 20% to 30% of workers believe that they are covered by non-compete clauses. The Government have been reviewing the research and work done to date on non-compete clauses, and I am pleased to be able to confirm that we will be consulting on options for reform of non-compete clauses in employment contracts in due course.

Finally, the noble Lord, Lord Hunt, asked for my suggested reading list following my noble friend’s kind offer earlier this afternoon. I can do no better than to recommend the excellent book by the noble Lord, Lord Clement-Jones, on AI. In that spirit, I ask the noble Lord, Lord Clement-Jones, to withdraw his Amendment 111ZA.

[Lord Clement-Jones (LD)]

The noble Baroness nearly won me over at that point. I thank her. I feel like someone who was expecting a full meal but receives a rather light snack. I will explain why as we go through.

I thank the noble Lord, Lord Holmes. I feel that I am somewhat upstaging him by putting an amendment at the front of the group, but we have many common themes that we both have pursued over the years together. I agree with him on the desirability of a cross-sector approach. He is much more patient than I am and, in putting down individual amendments and hoping that the Minister will give satisfactory answers, he is clearly more optimistic than I am. Whether his optimism has been justified today, I am not so sure.

The Minister could not even acknowledge the work done by the TUC, which has been ground-breaking in so many ways. It has taken four years, so it is extraordinary that the Government are doing what they are doing. I acknowledge what the noble Lord, Lord Pitkeathley, had to say. I was not quite sure how it connected to AI, but he very cunningly linked the subject of non-compete clauses to innovation, which does link to AI. I was encouraged by what the Minister had to say about consultation on reform.

The noble Lord, Lord Hunt, reminded me that I was a solicitor. Unlike him, I do not still have a practising certificate still, but there we are. He has much more stamina than I have. Non-compete clauses can be extremely important in making sure that know-how is preserved within an existing business. I thank the noble Lord, Lord Freyberg, for what he had to say on making sure that AI ensures human flourishing and that we preserve agency. That is what the amendments tabled by the noble Lord, Lord Holmes, and me are all about.

The Minister talked about an AI assurance ecosystem and AI management essential tools that there will be a consultation on, but I could not sense any intention to do anything other than a sort of voluntary approach. We have a lot of employment law that has developed over the years, but the Government seem to be allergic to doing anything with any teeth. She mentioned recruitment practices, but that again seems to be very much a voluntary approach. The AI Security Institute is not a regulator. I cannot feel that the Minister has given much more than the noble Lord, Lord Leong, gave last time. For instance, the Minister talked about consultation over make-work proposals. This involved talking about best practice on the adoption of AI and how best to deal with surveillance technology. Again, I did not sense any real intent to make sure that we have a new set of protections in the workplace in the face of AI.

I very much hope that, as time goes on, the Government will develop a much more muscular approach to this. As many noble Lords have said, AI presents a great number of opportunities in the workplace, but we absolutely do not want to see the opportunities overwhelmed by mistrust and a belief that AI presents unacceptable risks on the part of those employees. We want to see employees understanding that in the face of AI adoption, they have the right to be consulted and there is proper risk assessment of the introduction of these systems into the workplace, so that there is a proper, consensual approach to AI adoption.

I really do not feel that the Government are keeping up to date with the issues in this respect, and I am afraid that is rather reflected in some of the issues that we are going to talk about on Wednesday as well. In the meantime, however, I beg leave to withdraw the amendment.

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[Lord Sharpe of Epsom (Con)]

My Lords, it is a pleasure to follow the noble Lord, Lord Goddard. I agree with pretty much all that he said. I thank my noble friend Lady Barran for her amendments. I thank my noble friend Lord Agnew for his interesting and timely perspective, and I salute the teaching assistant whom he mentioned.

Amendment 111B would ensure that the establishment of national frameworks does not, by accident or design, limit the ability of employers to go further in improving conditions for their staff. It makes it clear that, while national terms may set the floor, they must not become the ceiling.

As we have heard, we must leave space for innovation and ambition at the local level, particularly for those schools, academies and trusts that are actively seeking to lead in areas such as flexible working, staff well-being or enhanced support for recruitment and retention. This amendment does not undermine the national framework. On the contrary, it reinforces it, because it allows it to act as a strong foundation on which more can be built, where employers have the capacity and willingness to do so.

We should not inadvertently create a situation where the national body becomes a constraint rather than a support. I therefore welcome the clarity that this amendment brings. I commend my noble friend for bringing it forward and, if she decides to press it to a vote, we will support her.

[Baroness Jones of Whitchurch (Lab)]

My Lords, I will speak first to government Amendments 112 to 116. The school support staff negotiating body will recognise the essential roles and responsibilities of over 800,000 support staff working in our schools, supporting our children to achieve and thrive. Like the noble Lord, Lord Sharpe, I very much pay tribute to the teaching assistant whom the noble Lord, Lord Agnew, mentioned. We all know examples of support staff who have played significant interventionist roles in helping to run a school—roles that are often underrewarded and unrecognised. It is about time we put them and their pay and conditions on a proper footing.

It is right that we have a mechanism for employer and employee representatives to come together to negotiate and to agree pay and conditions that reflect the varied and vital role that support staff undertake. We have heard arguments made across the House that we must make the legislation itself clearer, that the SSSNB will not mandate a one-size-fits-all approach and that individual employees will be protected from any moves to their detriment as a result of the SSSNB process. We have listened to noble Lords on this issue and, while we have always been clear that this is the Government’s intent and can be achieved through existing provisions, we have decided to amend the SSSNB provisions to ensure that both principles are established in primary legislation.

This change will mean that all school support staff will benefit from a minimum offer—or floor—for pay and conditions, and that there will be no ceiling to prevent employers offering better pay or conditions. This protects individual employees and allows employers to go beyond agreements reached, should they choose to do so in response to their local circumstances. That was the argument made in Committee. A number of noble Lords argued that, particularly in academies, employers want to pay more and provide better conditions. We are making it clear that that is absolutely the right thing to do, and our amendments will deliver that.

I turn to the amendments tabled by the noble Baroness, Lady Barran. Amendment 111A would change the SSSNB’s remit for academies so that academy employers would be required to have regard only to the framework. As outlined in response to this amendment in Committee, it would be wrong to create a two-tier system for support staff. Since roughly half of the 22,000 state-funded schools in England are now academies, it is right that academies are included in the SSSNB’s statutory remit in the same way as maintained schools. There is no need to take a different approach for academies when there will be ample room for innovation for all schools, irrespective of their structure.

I hope the noble Baroness understands and agrees that all school support staff deserve to know what they can expect as a minimum for pay and conditions, and that they can continue to benefit from more favourable terms where employers offer them. However, her amendment risks creating a two-tier system that undermines the role of the new negotiating body in establishing minimum standards which will work for all schools and recognise the vital roles that support staff undertake.

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Moved by

[Baroness Jones of Whitchurch]

112: Schedule 4, page 207, line 17, at end insert—
“(6) Subsections (2) to (5)—(a) do not apply in relation to a term or condition of a person’s employment if, and to the extent that, giving effect to the agreement would alter the term or condition to the person’s detriment; (b) do not prevent the terms and conditions of a person’s employment from including a term or condition that is more favourable to the person than that which would otherwise have effect by virtue of those subsections.”Member's explanatory statement
This amendment provides that an agreement of the School Support Staff Negotiating Body cannot alter a person’s terms and conditions of employment to make the person worse off, and does not prevent an employer from offering more favourable terms and conditions than those provided for by the agreement.

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Moved by

[Baroness Jones of Whitchurch]

117: Clause 44, page 66, line 22, at end insert—
“(5) Subsections (2) to (4)—(a) do not apply in relation to a term or condition of a social care worker’s employment if, and to the extent that, giving effect to the agreement would alter the term or condition to the social care worker’s detriment;(b) do not prevent the terms and conditions of a social care worker’s employment from including a term or condition that is more favourable to the social care worker than that which would otherwise have effect by virtue of those subsections.” Member's explanatory statement
This amendment provides that an agreement of a Social Care Negotiating Body cannot alter a person’s terms and conditions of employment to make the person worse off, and does not prevent an employer from offering more favourable terms and conditions than those provided for by the agreement.

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Moved by

[Baroness Jones of Whitchurch]

118: Clause 45, page 67, line 2, after “apply” insert “(but see subsection (8))”
Member's explanatory statement
This amendment is consequential on my amendment of clause 45 at page 67, line 10.

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Moved by

[Baroness Jones of Whitchurch]

120: Clause 46, page 67, line 27, at end insert—
“(3A) Regulations under this section that by virtue of subsection (2)(b) make provision about the consequences of a failure to comply with a duty imposed by the regulations in relation to a provision of guidance or a code of practice must provide for the guidance or code to be laid before the appropriate legislature and subject to the procedure specified.”Member's explanatory statement
This amendment provides that, where regulations under clause 46 provide for the issuing of guidance or a code of practice by the Secretary of State, and make provision about the consequences of a failure to comply with a duty imposed in relation to the guidance or code, the regulations must provide for the guidance or code to be laid before Parliament and to be subject to the procedure specified in the regulations. The amendment also imposes an equivalent duty in relation to regulations made by the Welsh Ministers or Scottish Ministers.

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Moved by

[Baroness Jones of Whitchurch]

122: Clause 49, page 69, leave out lines 13 to 19
Member's explanatory statement
This amendment is consequential on my amendment of clause 45 at page 67, line 10.

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[Lord Davies of Brixton (Lab)]

Having raised these issues at the beginning of Committee, I just want to say that, following the favourable response of the Front Bench to the idea of arranging a meeting at which they can be discussed, I very much look forward—at least, I hope I can—to the reply of my noble friend the Minister.

[Baroness Jones of Whitchurch (Lab)]

My Lords, I thank my noble friend Lord Hendy for moving his amendment.

Amendments 123 and 124 in my name relate to Clause 54, which provides powers to make regulations giving effect to two named international conventions and to give effect to international agreements as they relate to maritime employment. I thank the Delegated Powers and Regulatory Reform Committee for its thoughtful consideration of these powers, and its recommendation to amend the procedure for new Section 84A(2) from first-time affirmative to affirmative for all uses. I wrote to the committee on 7 July, setting out our response in full.

These amendments will change the parliamentary procedure applicable to regulations made under the power in new Section 84A(2) of the Merchant Shipping Act 1995, giving effect to international agreements as they relate to maritime employment. The amendments mean that all uses of the power to give effect to future or unspecified international agreements will now be subject to the affirmative procedure, and not just the first use. They will mean that Parliament has greater oversight of these agreements and amendments to them.

I turn to Amendment 122A tabled by my noble friend Lord Hendy. The amendment would specify that the statutory rights to which shore-based workers in the UK are entitled also apply to ships’ crews working aboard services that enter ports in Great Britain 120 or more times per year, or that operate

“between a place in Great Britain and another place in the United Kingdom”.

The scope of services covered follows the approach taken in Clause 29, where the Government have sought to ensure that those employed aboard these services are captured by the requirement to provide proposed notification of collective redundancy.

I thank my noble friend for this amendment on the application of employment rights to seafarers, and the maritime trade unions for their continuing engagement on these issues. I hope to be able to provide some clarity today, but we can also commit to continuing ongoing discussion about how we can ensure that seafarers are receiving robust protections.

The Government want to see stronger employment rights for seafarers. That is why, in addition to the broader changes to employment rights, we have included a package of maritime-specific measures in this Bill. As my noble friend knows, we are closing the loophole that meant that P&O Ferries could avoid prosecution for failing to provide advance notice of proposed collective redundancies. We are also providing powers for a mandatory seafarers’ charter, which will allow us to set a higher minimum standard for wages and for how long seafarers can spend at sea without a break. This will establish a level playing field that will help prevent the undercutting of working conditions in the way that P&O Ferries sought to do.

The new power to give effect to the Maritime Labour Convention, and other international agreements as they relate to maritime employment, is also important. Where international agreement is needed to improve protections, we can implement those changes.

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Moved by

[Baroness Jones of Whitchurch]

123: Clause 54, page 73, line 32, leave out from “84A(2)” to end of line 34
Member’s explanatory statement
This amendment, together with my other amendment of this clause, provides that regulations under new section 84A(2) of the Merchant Shipping Act 1995 giving effect to international agreements relating to maritime employment will be subject to the affirmative resolution procedure.