Employment Rights Bill

Debate between Baroness Lawlor and Lord Leigh of Hurley

Committee stage
Thursday 5th June 2025 Lords Chamber

[Lord Leigh of Hurley (Con)]

My Lords, I support these amendments and, in particular, my noble friend Lord Jackson of Peterborough’s remarks. I agree with every word.

I vividly recall the change in this country, in 1979, when union power was such that people were frightened of starting businesses or to go to work. Murdoch took a brave stance to take the unions head on and, after 1979, the country emerged with much greater strength, economic certainty and prosperity. As a result, people like me chose to start a business in this country. That was because of the economic prosperity created by Thatcher’s Cabinet and team. Any attempt to go backwards rather than forwards is very depressing and disappointing.

My noble friend Lord Jackson is of course right that Clause 55 is the kernel of the Bill. It is an important clause that reveals why the Bill is so inappropriate and badly drafted, and it needs amendment or, if not, not to stand part.

I refer to the British Chambers of Commerce, an independent organisation which, as we know from Second Reading, criticised the Bill because of its lack of consultation, because of its greater restriction and penalties for firms that want to make workforce changes but, most importantly, because of the greater responsibilities, costs and complexity for employers. The Bill includes some of the most significant and widest range of changes to employment laws for decades.

The Government’s own assessment suggests that the legislation will cost businesses almost £5 billion a year, and that the SME sector will be impacted most. This is at a time when, just in the last couple of months, businesses have come to terms with the dreadful, unnecessary and wholly growth-destroying national insurance increase. It is literally putting businesses out of business. Your Lordships do not have to believe me; just look at the last insolvency statistics, which show record figures of insolvency, particularly for CVLs—creditors’ voluntary liquidations. People are throwing in the towel; they are not prepared to carry on business when they are faced with these increased costs for employing people and for properties and business rates, which the Bill imposes on all businesses.

My particular concern is with the SME sector. We debated this at Second Reading, and I complimented the noble Lord, Lord Leong, on starting a small business. He therefore knows and understands this, but many people on the Front Bench of the Labour Party do not have that experience and expertise and are not aware of the damage this will do. These amendments are vital, particularly to try to exempt small businesses—and, if not small businesses, micro-businesses—from these onerous requirements.

To take it to the point of absurdity, and to declare an interest, I personally employ one person—do I have to give that one person a piece of paper when they join? It looks like I do. Will I then be told by the Government that I have to give that person a statement “at other prescribed times”? What does that mean? It means that when the unions are short of members, as they invariably are, and they need to raise more money —we know where that money largely ends up—they will say to employers, “Right, you’d better give all your staff a statement to tell them that they have the right to join a union”, and encourage them so to do. It is on the point of absurdity.

The BCC goes on to say:

“the scale and scope of the changes is huge, with many feeling they are being rushed through at breakneck speed … Firms are particularly concerned about the lack of detailed consultation on the Trade Union changes, especially when the Government’s own assessment was so vague about the impact”.

It rightly points out that:

“Overall, there is a lot in the Employment Rights Bill that reinforces much of what good businesses already do. But the fear remains that certain elements could create huge costs for firms and damage the UK’s ambitions for growth”.

I repeat the request made to the Government Front Bench by the noble Lord, Lord Jackson, to cite businesses—SME businesses in particular, but actually any businesses—that are in support. Richer Sounds is not a good example. Julian Richer sold Richer Sounds to an EOT—it is a co-operative. One of the firms mentioned last time was Nationwide. That is not an SME, and the Co-op is certainly not. So where is the support for this? Please can we exclude this extremely vague “at other prescribed times”, which is without any limitation or cap? If it said “annually”, that might be a start. Can we also exclude both SMEs and micro-companies from these onerous requirements?

[Baroness Lawlor (Con)]

My Lords, I support the amendments in this group that seek to mitigate the impact of Clause 55, which amends the Trade Union and Labour Relations (Consolidation) Act 1992 by inserting a new section with a

“Statement of trade union rights”.


I support, in particular, Amendment 205 by the noble Baroness, Lady Noakes, which would apply the statement only to larger companies. We have heard very good arguments as to why this should happen. I support the amendment by the noble Lord, Lord Jackson, which would leave open to employers the option to decide whether to apply the statement under the new Section 136A. I support the amendment of the noble Baroness, Lady Noakes, which would mean it does not apply to smaller employers and those with fewer than 10 employees, as well as her amendment that probes why such a statement should be given at times other than the start of the job. The noble Lord, Lord Leigh, put forward some good potential reasons.

This a very bad clause. I oppose it for two reasons. I support the noble Lord, Lord Sharpe, on the Front Bench, who has stated that it should not be part of a Bill, certainly not in 2025. Such obligations interfere with the professional balance of duties and responsibilities in a business between employer and employee. The employer must promote the best interests of the business and, with the directors of the company, employers are bound to do so.

Employers are also bound under employment law. The 1992 Act, which this clause amends, already strikes a balance between the role of trade unions in the workplace and the employer. It sets out that the employer or business recognise trade unions that meet certain criteria, engage in collective bargaining, provide information to the unions and respect those engaged in lawful industrial action. We already have recognition of the responsibilities of employers to trade unions in the workplace; a balance has been struck, and it has worked, by and large, very well.

The interests of the business will also involve treating all workers not only legally but fairly and professionally. It should not involve employers being obliged, as the new Section 136A stipulates, to give a written statement that the employee has the right to join a trade union at the start of the job and at other prescribed times. It should also not be left to politicians, as the new section states—the Secretary of State at the time—to prescribe what information is included, what form the statement takes, in what manner it should be given, and whether regulations prescribing anything for the purpose of this section may make different provision for different purposes.

Are we making the law or are we leaving it to some executive authority to make something up on the back of an envelope and prescribe it through his or her officials in government? This is not lawmaking, and this Parliament should challenge this sort of power being given to a Secretary of State to do what he or she may like. This not only adds a layer of bureaucracy but brings uncertainty to businesses and adds costs, from which smaller businesses at least should be spared.

The individual choices that employees make should not be anticipated by presuming that union membership is an assumption that both employer and employee make. That undermines the freedom of both parties to have a non-politicised atmosphere and implies that a business will be run in an atmosphere of expected confrontation instead. It suggests that freedom is being undermined. Yes, it does not require an employee to join the union, but if an employer presents a new employee with this statement, what on earth is the employee to think except that this is what should be done in order to get on in this business?

The second ground for objection, however, is more general. Obliging businesses to make such a statement politicises the internal arrangements of business. Trade union membership may or may not be something individuals choose, but we must recognise that trade unions are affiliated to the Labour Party; they founded the Labour Party. The Parliamentary Labour Party appears to be dominated by former union members—or perhaps continuing union members. At certain times of Britain’s history, trade unions have dominated many workplaces and paralysed public services. Indeed, we see that continuing this year in Birmingham, with the paralysis in relation to bins and the failure of the council to deal with the Unite union. They have stopped the productive activities of the British people in industry and in business, undermining the economic success of the whole country and the ability of people to earn a decent wage or salary.

I am afraid they have undermined freedoms and have undermined the democratic decision by the people of this country to live without fear—fear that their child’s school will be closed by strikes, fear that their university lectures may be cancelled because the union has called a strike, and the fear of many working people that they cannot get to work and earn their money because the railways are strike-bound. This clause should not be in the Bill. It undermines the freedoms that were fought hard for by Conservative Governments since 1979 to restore freedom in the workplace, with a fair balance between trade unions and working people.

When I first came to this country in 1979 as a student, one of the members of staff of my college told me, “I am the sole earner in my family now. My husband had to join a union because of the closed shop. He couldn’t get a job without joining a union. Now that he has joined the union, he has been told he can’t work. This is why I, for the first time in my life, am voting for the Conservative Party and Mrs Thatcher”. Conservative Governments have successfully and successively restored order to the economy, allowed this country to prosper, allowed people to get jobs, helped entrepreneurship and growth, and helped Britain to no longer be the sick man of Europe. People voted for that. We should not turn the clock back to a day when we are chipping away bit by bit at those rights, so that people will not have the freedom to earn and this country will not be able to pay its way.

--- Later in debate ---

[Baroness Lawlor (Con)]

I support Amendments 212 and 213 in this group tabled by my noble friend Lord Jackson. I agree that a 24-hour notice period is necessary, particularly for small businesses, because access to the workplace by third parties can be disruptive. Visitors calling unannounced can disrupt a carefully organised schedule between an employer and his or her employees. The 24-hour notice period would allow employers to prepare for a visit and to reschedule certain tasks. I support exempting smaller businesses from some of these arrangements, because it is very hard to organise smaller businesses with third-party interruptions.

[Lord Leigh of Hurley (Con)]

My Lords, I support the amendments of the noble Lord, Lord Jackson of Peterborough, and others. This clause strikes horror in my heart. The idea that someone could come into my business, access my premises with no notice—good luck with that, because I sit in a room on my own—or even worse, access my systems and my server, which are all heavily password-protected because I am regulated, strikes horror not just in my heart. I can assure the Minister, who says that she has consulted business groups, that she will see surveys coming out in the very near future that show the fear, horror and dislike that small businesses have of this Bill, and in particular the clauses we have been debating tonight. I hope she will have the opportunity to meet again with business representatives and listen to what they are saying.

The draftsman on this Bill is working in another era. What does physical access to a business mean? I like the clauses restricting this for smaller businesses, because most small businesses do not have a physical presence. In many businesses, literally tens of thousands of them, the employees work from home. They might have a WeWork office where they meet every now and then, but it is meaningless to give right of access to most small businesses. If we then go to right of access to digital communications, that implies, from the wording I have read, that a trade union official would have to be given the passwords to enter the systems.

What protection is there? What indemnities are there to ensure that this is not abused? We know that abuse happens, particularly in these days of cyber fraud, where someone who has accessed the system could take advantage. Obviously, I am not suggesting that that is going to be prevalent or happen in the majority of cases by any means, but I do not see any protection for small businesses should that happen.

It seems to me that the whole concept of access is misconceived. I would quite understand it if the legislation were drafted to require an employer of any size to pass messages to an employee—I would understand that; it would be reasonable—but can the Minister explain to us why she is demanding access to both physical and digital assets of small businesses?

National Insurance Contributions (Secondary Class 1 Contributions) Bill

Debate between Baroness Lawlor and Lord Leigh of Hurley

Committee stage
Wednesday 29th January 2025 Grand Committee

[Lord Leigh of Hurley (Con)]

I am most grateful to my noble friend Lady Sater for underlining my point. It is exactly that. People will turn to me and ask, “Well, why should I give to you, Lord Leigh, and your fundraising efforts, because the Government are going to take away much more?”

According to the Charity Commission website, there are 5,435 charities with an income between £0.5 million and £1 million. On average, they make a surplus of just over £13,000 and employ about 12 people. So the increased cost caused by the raise in the NI for people on the minimum living wage, which is a large proportion of such people, will be £997. There are some heroic assumptions in this, but it is not unreasonable to say that the cost to these charities, on average, will be just over £12,000, which wipes out almost their entire surplus.

I accept that those charities will receive employment benefits, so let us look at some of the larger charities. There are 6,000 charities in the £1 million to £5 million range. Interestingly, they raise a total of £13 billion and spend a total of £12 billion, most of which is on salaries. On average, they employ some 35 people and the surplus is just over £19,000. The extra cost to them will be £35,000, which will not just wipe out their entire surplus but push them into deficit.

There are only 1,200 charities with income in the £5 million to £10 million range, and they employ an average of 104 people, so the extra cost to them of the NI burden is £103,000. Their average surplus is £47,900. Once again, their surplus will be completely wiped out and, thanks to the imposition of these extra costs, they will make a loss.

As my noble friend Lady Sater said, the NCVO wrote to the Chancellor, and I note that its letter was signed not just by the NCVO but by 7,360 charities. It employs over 1 million people. Charities deliver benefits to the public sector of some £17 billion a year, so this is distressing, to say the least. My noble friend raised a number of specific charities; she mentioned a local Age UK, with which I do not have any connection. Age UK states:

“This particularly impacts organisations that employ significant numbers of low paid staff … Local Age UKs are warning that these changes will significantly impact their ability to provide essential services to vulnerable older people, particularly in underserved areas”.


In turn, this will have

“a knock-on effect on older people’s health and wellbeing, increasing demands on our already hard-pressed health and social care services”.

I made the point earlier—it was a political point—that the Labour Front Bench does not have as much business experience as it might, although it has many other attributes and qualities. It has a strong and close connection and experience with the charitable sector; there is a good relationship. So why on earth would the Government not accept these amendments to help the charitable sector and save it from these disastrous costs?

[Baroness Lawlor (Con)]

Will the noble Lord comment on a different service that charities provide? For instance, my think tank has often been contacted by government departments asking to have a run of research on, say, intellectual disability and its cost. When I ask the official why they want that, they say, “It would be a very good study, but we couldn’t do it for less than—”, and they tell me the astronomical sum of money that it would cost them to do the same study.

Time and time again, we have demands for all kinds of work, which we have done and published, because we can do it, and we can get the best people to do it. People will give their expert advice and analysis for free. The Government, of whatever complexion, will then benefit. Why have this Government and other Labour Governments not done this? It is like cutting off your nose to spite your face.

Of course, I do not think for moment that the noble Lord, Lord Leong, on the Front Bench opposite, does not have business experience, but charities save taxpayers money and provide the Government with many different types of services.

[Lord Leigh of Hurley (Con)]

I thank the noble Baroness, Lady Lawlor, for that. One of the four charities that I chair is a think tank, so I totally agree with her. In this country, the Charity Commissioners are particularly effective and very good at clamping down on organisations that are not proper charities. So we can be comfortable that any organisation registered with the Charity Commissioners as a charity is bona fide and generates good work, as the noble Baroness said.

I urge the Minister to have a deep think about this and consider an additional exemption for the private sector. An exemption has already been made for the public sector, so it is doable.