Maternity Leave, Adoption Leave and Shared Parental Leave (Amendment) Regulations 2024

Lord Leong Excerpts

Tuesday 30th January 2024 Grand Committee

[Baroness Bennett of Manor Castle (GP)]

My Lords, I rise briefly in an unusual situation. We Greens in your Lordships’ House are sometimes accused of not giving the Government credit where it is due, but I want to congratulate the Government on this statutory instrument and applaud the progress that is made in it.

We should also applaud the fact that behind this has been a huge amount of campaigning of public concern. I note that the charity and campaigning group, Pregnant Then Screwed, which took four awards at the Third Sector Awards last year, has been campaigning on these issues for a very long time and is making real progress. This is a real demonstration that campaigning works; we have seen something happen here, so I can only congratulate the campaigners and the Government on this.

I want to put a couple of questions to the Minister. What are the Government going to do to ensure that employers and employees know about this change in the law? What kind of publicity campaign will there be? The Minister referred in his introduction to the fact that the figures that the Government were relying on were quite old. Are there plans to update and take assessment both of the current situation and of what happens in the months and years after this statutory instrument comes into effect? What reporting back will there be to the House and the other place so that we can continue to monitor this important area, given that it is important to individuals and households, but also important to ensure that people are able to remain in the workplace?

[Lord Leong (Lab)]

My Lords, this is the second time that we are meeting across the Dispatch Box. If it continues, people will start talking. I thank the Minister for the overview and explanation of this statutory instrument, which builds on the Protection from Redundancy (Pregnancy and Family Leave) Act 2023. I fondly remember the debate on this Bill last spring. It was the first time I had the honour of speaking from the Front Bench in the main Chamber. Not only did the noble Baroness, Lady Bertin, praise the work of the TUC in the development of this legislation but we agreed to have a massive group hug.

Pleasingly, almost exactly nine months after this group hug, are now delivering additional legislation through this statutory instrument. It provides similar rights in a redundancy situation to pregnant women and new parents who have recently returned from a period of maternity, adoption or shared parental leave lasting six weeks or more. Additionally, the protection will now start when the employee tells the employer about the pregnancy.

This legislation is supported by my friends and colleagues in the trade union movement. In fact, some of these measures were discussed in the preparation of the Bill last year, which, at the risk of disrupting this very collegiate atmosphere, I remind noble Lords was a Private Member’s Bill from my friend, the honourable Member for Barnsley Central.

As supportive as we are of this change, it does not come without implications for employers, especially those who may be considering restructuring shortly after the instrument comes into effect on 6 April, as mentioned by the noble Baroness, Lady Bennett. What steps are the Government taking to make sure employees are prepared? Additionally, is there any additional monitoring for the implementation period where employees may not be abreast of the new law?

Among other possible difficulties with implementation, women may now feel under pressure to inform their employer of their pregnancy very early if there is an impending redundancy exercise. What consideration have the Government given to this likelihood and potential steps to help protect women from this? Another potential difficulty comes from the notification requirements and record keeping. The regulations are not clear as to the form of the notification required. Can the Minister shed any light, or would this be a matter for the courts? Would oral notification suffice, and what would then happen if accounts varied?

Since 2019, we have been promised more than 20 times an employment Bill that will

“protect and enhance workers’ rights as the UK leaves the EU, making Britain the best place in the world to work”.

Will the Minister finally accept that this long-promised Bill is a mirage and will not be delivered? I look forward to his responses to our various questions. Other than that, we are very supportive of these regulations.

[Lord Offord of Garvel (Con)]

I thank the noble Lord and the noble Baroness for their contributions.

I come first to the noble Baroness, Lady Bennett. I appreciate her support on this matter. I know that she is close to the campaigning charities; it is good to be able to report that their campaigning results in meaningful change in legislation. That should be noted. I agree that the big issue now is communication. On many of these matters, it is now all about how we work closely to get the message out. We will work closely with the Pregnancy and Maternity Discrimination Advisory Board on the guidance and on basic ITJ promotion. We will also work with the board to work out how best to monitor and measure a more up-to-date labour workforce in this area. We expect to see great improvement in this area with the legislation passed, but it will be down to the communication.

I turn to the points made by the noble Lord, Lord Leong. I welcome his support for the regulations, which shows that we can work together when we have common interests. It shows that more unites us than divides us, especially when it comes to helping the more vulnerable members of our society. Clearly, there are philosophical differences between the two sides of this place when it comes to employment matters and the employment Bill, which was referenced by the noble Lord, Lord Leong.

We think that employment law in this country is in good shape, as proven by the fact that we now have 33 million people, out of a population of 65 million, in work—a record number—and by the protections that they have cascading down while they are employees. From the self-employed through to parallel workers, all now have legislation affecting and contributing to their safety and rights. We would therefore say that the focus for our Government should be to help the 5 million people who are economically inactive, have fallen out of the workplace and need a pathway back to work. We need to focus our efforts on helping that cohort back to work, because we know that there is a lot of talent in that cohort that is currently being wasted.

Putting those philosophical differences aside, I believe that we have consensus on this matter. The Government are pleased to be able to deliver these stronger redundancy protections for pregnant women and those returning from parental leave. We want to see these regulations succeed, because we have an opportunity here today to make a real difference to the lives of those who may rely on this protection in future. Supporting these measures is in line with our ongoing commitment to supporting workers and building a highly skilled, high-productivity and high-wage economy.

UK-Canada Trade Deal: Suspension of Negotiations

Lord Leong Excerpts

Tuesday 30th January 2024 Lords Chamber

[Lord Offord of Garvel (Con)]

This is the issue. Canada has been in a recent—2016—deal with the EU and understood the SPS rules of the EU. It understands fundamentally that we are not reducing our rules on SPS, but it has seen an opportunity, and you go for the gap when you see the opportunity, do you not? If you are a trade negotiator, you think to yourself, “Where can I get my point of advantage?” On our two outstanding issues, the cheese and the rules of origin—where, again, we are pretty much sorted with a rollover from the EU—Canada has seen an opportunity to cross that line. It is a pause in negotiations and we will get back round the table as soon as it comes back over the red line.

[Lord Leong (Lab)]

My Lords, the Institute for Government has warned that the Government’s failure to set out red lines on key issues in trade talks is a “recipe for disaster” and could delay new trade agreements. They now need to move urgently to put them in place, otherwise they will find themselves losing control of trade negotiations to better-prepared partners. What assessments have the Government made of the size and experience of negotiating teams as part of the recent machinery of government changes?

[Lord Offord of Garvel (Con)]

I thank the noble Lord for that. That is one of the reasons why we split up BEIS and put it into different, independent departments. However, my department, the Department for Business and Trade, is now well equipped to lead these negotiations. As I say, we have done the 65 country rollovers; we are now up to 73 countries and we have another 12 in the pipeline. We have a chief negotiator, Crawford Faulkner, who came in from New Zealand— I declare an interest in that he was born in Greenock, around the corner from me—who is doing an excellent job. The issue here is that our economy is now 80% services and 20% goods, but our exports are 50:50, which is because our goods are good. They go around the world and everyone wants to buy them. However, the direction of travel will be two-thirds services, one- third goods, which is why we need new trade agreements that cover services—not just goods—digital and innovation. That is exactly what we have with Australia, and that is what we are trying to achieve with Canada. I am hopeful that we will be able to get the show back on the road with Canada.

Digital Markets, Competition and Consumers Bill

Lord Leong Excerpts

Committee stage
Monday 29th January 2024 Grand Committee

[Lord Clement-Jones (LD)]

My Lords, this is quite a set of amendments and the Minister rather rattled through his speech, but I have only one question: why are they now being included in the Bill here in Committee? Why were they not in the original version of the Bill? What is the motivation behind these new amendments? I am always a little suspicious. With the data protection Bill coming down the track, we will have hours of endless excitement. The words “data protection” and “government” are sometimes a bit of a red rag, so one always has to kick the tyres quite hard on any provision that appears to be opening a door to disclosure of data and so on. Obviously, in a competition context, it is most likely to be commercial confidential information, but the Minister needs to explain what kind of information we are talking about and why we need to have these provisions included at this stage.

[Lord Leong (Lab)]

My Lords, I thank the Minister for his overview and explanation of the various government amendments. I look forward to his response to the question from the noble Lord, Lord Clement-Jones: why now? These are mainly technical and tidying-up amendments and we are in broad agreement with most of them in this group.

Amendment 217 makes it clear that any imposed or conferred duties to process information do not contravene data protection legislation. That is welcome. Amendment 213 ensures the disclosure of information under Chapter 2 of Part 5 of the Bill, which allows UK regulators to provide investigative assistance to overseas regulators. This is in line with the restrictions on the disclosure of certain kinds of information found in the Enterprise Act 2002, which is fine. I ask the Minister what assessments are in place to safeguard the sharing of such details with autocratic regimes, which may not have robust governance and accountability systems in place and whose values we do not share? On Amendment 218, I ask the Minister whether the intent is similar to that of Amendment 1, as set out so eloquently by my noble friend Lady Jones of Whitchurch on the first day of Committee?

Finally, I refer to Amendment 216, which replaces the definition of data protection legislation for the whole of the Bill, so the definition in Amendments 73 and 208 are removed. Can the Minister confirm that such a definition is consistent with Article 8 of the European Convention on Human Rights and the Enterprise Act 2002? I look forward to the Minister’s response and comments.

[Lord Offord of Garvel (Con)]

I thank the noble Lords for their questions. I will first address the question from the noble Lord, Lord Clement-Jones. I do not see the shadows that he sees within the amendments. Unlike in the first part of the Bill, which introduces new bodies, units and legislation, we are here looking back consequentially at the Enterprise Act and Consumer Protection Act and building on them. The amendments simply improve the Bill while maintaining the overall policy intent and approach and the procedure, which is technical in nature. For example, we will go through the whole list of consequential Bills to which data protection applies to make sure that we have got a single concept of data protection across all the various Bills that consequentially apply.

The data protection amendment does not change but merely clarifies the application of existing data protection legislation across the Bill, as mentioned by the noble Lord, Lord Leong. Information of relevance will mostly be commercially sensitive information, as the noble Lord suggested. In answer to the second question of the noble Lord, Lord Leong, about international information disclosure, it will be governed by Part 9 of the Enterprise Act, which ensures appropriate safeguards.

I look forward to discussing more of these substantive measures later today and in future sessions. However, having answered the questions, I hope that the amendments can now be accepted. I beg to move.

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The Secretary of State will be able to assess public interest issues when newspapers, broadcasters and video or audio platforms might buy social media platforms and search engines. This is a new provision, which would amend the Enterprise Act and increase symmetry in these media mergers. I very much hope that the Minister will give it careful consideration as we go forward through the House with the Bill.

[Lord Leong (Lab)]

My Lords, I thank all noble Lords who have contributed to this debate. I will refer first to Amendment 73A, which my noble friend Lord Knight of Weymouth set out so succinctly. Let us remind ourselves that the digital regulation co-operation forum, the DRCF, was founded by the CMA, the Information Commissioner’s Office and the Office of Communications—Ofcom. The FCA subsequently joined as a full member the following year. As mentioned by the noble Lord, Lord Clement-Jones, the purpose of the DRCF is to ensure coherent, informed and responsive regulation of the UK digital economy. When this is achieved, we can serve citizens and consumers better, reduce regulatory burdens for industry where appropriate and enhance the global impact and position of the UK.

The noble Baroness, Lady Kidron, and my noble friend Lord Knight have said that workers are really important in the competition space. The noble Baroness reminded us that workers are also users and citizens; they should be involved in any regulation. Having conversations with them would make a better competitive environment.

The noble Baroness, Lady Harding, and the noble Lord, Lord Ranger of Northwood, cautioned us that we should not allow regulators to stifle innovation. We really need to let innovators do their thing and the old saying “Do not kill the goose that laid the golden egg” is so true in this respect. We need to ensure that the right framework is in place so that the regulators are not overburdened with too much regulation that would stifle innovation, so we really support Amendment 73A. It would empower the CMA to co-operate with other government bodies which may have the power to obtain information relevant to its regulatory functions.

I refer now to Amendment 93A, tabled by the former chair of the CMA, the noble Lord, Lord Tyrie, who has a deep understanding of the relevant issues in this area. Whistleblowers with insider knowledge who provide assistance to the CMA can be a powerful tool in helping to uncover cartels and other anticompetitive practices more swiftly than might otherwise be possible. Since cartels often operate in secrecy, individuals or companies with insider or market knowledge can play a crucial role. They can bring issues to the CMA’s attention or gather information that will allow it to start an investigation.

The primary legal protection for whistleblowers in such situations comes from the Public Interest Disclosure Act—PIDA—which won praise when it was first introduced in 1999. More recently, it has been criticised for not protecting the majority of whistleblowers from suffering retaliation with little or no legal recourse. In January 2023, the Minister for Security said that

“what the country needs is an office for whistleblowers, and what we need to do is ensure that we have the updates to the legislation”.—[Official Report, Commons, 25/1/23; col. 1094.]

Can the Minister update your Lordships’ House on whether any primary legislation to that effect is forthcoming?

[Lord Offord of Garvel (Con)]

Amendment 73A, tabled by the noble Lord, Lord Knight of Weymouth, would require the CMA to co-operate with regulators and bodies with responsibility for matters relating to employment and working conditions. I thank the noble Lord for his amendment, for raising the importance of regulatory co-ordination, and for once again highlighting the direct and indirect impacts of digital activities and competition policy on workers.

On the first day of Committee, a number of noble Lords argued that the CMA should take a wider view in considering impacts on work and work environments in its regulatory functions. The CMA can already consider these issues where they relate to competition. Indeed, although competition authorities in the past focused primarily on competition in product markets, we are seeing them take an increased and welcome interest in labour markets. The CMA’s annual plan sets out how it will prioritise investigating businesses engaging in anti-competitive labour market practices. It is already using its powers to take enforcement action against firms that break the law by fixing wages.

However, the amendment would go beyond the scope of the competition remit of the CMA, potentially creating new burdens and additional complexities. It would therefore detract from the aims of the UK competition regime, and it would be inappropriate for the CMA to assess impacts unrelated to competition, which is its area of expertise and jurisdiction.

The noble Lord, Lord Knight, mentioned the director of labour market enforcement, who is an independent public appointee with a statutory responsibility to prepare an annual strategy for Home Office and DBT Ministers, setting out their assessment of the scale and nature of non-compliance in the labour market. In this way, there is already an independent assessment of the labour market and enforcement, so this amendment could infringe or duplicate the director of labour market enforcement’s remit.

The noble Lord, Lord Clement-Jones, mentioned the report by the Competition and Market Authority’s microeconomics unit. This takes a deep dive into the trends in the UK labour market, focusing on the impact of competition and employer market power. Where labour market issues are relevant to competition, the CMA already looks at this.

On co-operation between regulators, I agree with the noble Lords, Lord Knight and Lord Leong, and the noble Baroness, Lady Kidron, that this is essential. Part 9 of the Enterprise Act facilitates exactly that. The CMA works closely with bodies, regulatory and otherwise, both when delivering its own regulatory functions and when supporting others in theirs.

I agree with my noble friend Lady Harding that we should not provide the CMA with additional roles and duties that risk undermining the careful balance between effective enforcement and preventing overenforcement and overregulation, which risk stifling innovation. It would further confuse the regulatory landscape to require the CMA to consider labour market issues in this way, beyond its remit and expertise. Nothing in legislation prevents the CMA and other regulators from co-operating on these important issues, subject to necessary information-sharing safeguards. We do not need to legislate to achieve this.

The DMU specifically will be required to consult the regulators whose remits have the most interaction with the digital markets regime. It can, and will, engage with other authorities, including labour market regulators, where appropriate.

I will touch briefly on regulatory functions analysis. While the CMA works closely with other regulators and authorities, it would not be appropriate for it to conduct an analysis of other regulators’ functions as a regulator itself. For these reasons, I hope the noble Lord will withdraw his amendment.

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[Lord Offord of Garvel (Con)]

I do not have a detailed timetable. I understand this is being looked at currently. I am happy to confirm in writing when we have a detailed timetable.

I move now to Amendment 93A and protection for whistleblowers. I again thank the noble Lord, Lord Tyrie, for his informed contribution to the scrutiny of this Bill. I also thank the noble Lords, Lord Clement-Jones and Lord Leong, for their contributions on this topic. Amendment 93A would introduce a new requirement for the CMA to carry out a review of protections and support available for whistleblowers under the UK’s competition and consumer law.

The noble Lord will know that the Government consulted on the important issue of incentives and protections for whistleblowers in the competition regime. However, no clear evidence or support was put forward by respondents that would support making changes to the existing framework. Therefore, the Government do not propose to introduce reforms to whistleblowing protections. In taking this decision, we also considered that the courts can already give due weight to the importance of anonymous whistleblowing in competition law enforcement. This could, for example, justify a court restricting how the identity of a whistleblower is disclosed depending on the circumstances of the case.

As the noble Lord mentioned, in 2023 the CMA increased the compensation cap for informants in cartel cases from £100,000 to £250,000. This will support the CMA to investigate effectively and, where appropriate, enforce against criminal cartels, which can cause serious harm to consumers and businesses within the UK.

Any whistleblower worker who faces victimisation in the UK can also seek additional compensation from their employer in an employment rights tribunal. This compensation can be awarded uncapped and can reflect the costs of some whistleblowers being unable to work in their chosen profession again.

The Government, therefore, have not proposed reforms to the compensation for whistleblowers in the Bill. However, I stress that we recognise the importance of whistleblowing in uncovering wrongdoing and will continue to ensure whistleblowers are not discouraged from coming forward under the current framework.

At this time, we do not think that a review in the form that the noble Lord’s amendment calls for would be merited, nor that it would be appropriate to place a new and binding obligation on the CMA requiring it to conduct such a review within a specific timeframe. For these reasons, I hope that the noble Lord does not push this amendment.

[Lord Leong (Lab)]

Can the Minister share whether there is any update on the office for whistleblowers, as mentioned by the Secretary of State?

[Lord Offord of Garvel (Con)]

I need to write to the noble Lord on that.

I now speak briefly to the government amendments in this group, all of which are minor and technical in nature. First, Amendments 90, 91 and 92 ensure that extensions to the statutory deadlines for phase 2 merger investigations under the new fast track procedure for mergers operate correctly within the existing legal framework for deadline extensions under the Enterprise Act 2002.

Secondly, government Amendments 94, 95, 97, 98, 99, 100 and 102, will clarify that, in the civil penalty provisions introduced and amended by Schedules 9 and 10 to the Bill, references to maximum amounts of daily penalties are maximums per day and not in total.

Thirdly, Amendments 96 and 101 update cross-references in Section 120 of the Enterprise Act 2002, so that decisions made under the civil penalty provisions in Part 3 of that Act, as amended by the Bill, are carved out from that provision. Section 120 allows persons to seek a review of a CMA decision in the CAT on judicial review principles. Such a review is not required because penalty decisions are appealable on a merits basis.

Fourthly, Amendment 103 makes the equivalent amendment to Section 179 in relation to civil penalty decisions made under Part 4 of the Enterprise Act.

Finally, Amendments 104 and 105 have been introduced to take account of an amendment made by the Energy Act 2023 to Section 124(5) of the Enterprise Act 2002, which is also amended by the Bill.

I hope noble Lords will support these government amendments.

Trade (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) Bill [HL]

Lord Leong Excerpts

Report stage
Tuesday 16th January 2024 Lords Chamber

[Lord Johnson of Lainston (Con)]

My Lords, Amendment 4 is a minor technical amendment that the Government have introduced. I will read out my brief to be clear, because it is quite technical. The Bill as currently drafted may lead to a degree of uncertainty for decision-makers over the date that should be used when assessing whether the new grounds for cancellation of a geographical indication apply in a case where the GI has successfully undergone a name change. Under the current drafting, it could be argued that, in such a case, the date on which the original application to register the GI was submitted under Article 49 of Regulation 1151/2012 should be the date used to carry out the assessment and not the date when the name change application under Article 53 was submitted. This amendment addresses that uncertainty by making it clear that the assessment should be carried out based on the factual position relating to the date when the name change application was submitted, rather than the date the original Article 49 application was submitted.

I will translate that a little. The provision is effectively looking at the date on which the name change is submitted, rather than the original name. If I have a GI—“Johnson’s Water” or whatever it may be—registered in 1990 and then change the name to “Lord Johnson’s Water” this year, then the reference would be made to the point at which the name change application was made, rather than the status at the time of the original GI. It is a clarification which we think is important, and I trust my officials’ view on that.

I will just answer briefly the very helpful comments raised about Japan and geographical indicators. I would be extremely grateful to my noble friend Lord Lansley for making representation to the authorities in Japan to speed the process up. We are fully committed to ensuring that our GIs are protected in Japan; it is part of the agreements we have undertaken, but these things take time to effect. We are doing everything we can to be sure that those indicators are protected. Anything that he can do to speed that process up will be gratefully received by this Government. I beg to move.

[Lord Leong (Lab)]

My Lords, as we have heard, this government Amendment 4 is really a relatively minor and technical amendment, so there is not much to add, except for some questions we hope the Minister will respond to. How often do the Government expect this test to be utilised, and are there any potential ramifications they will come across? What happens if the name change application is not successful—is that a possibility? Finally, if a name changes from a geographical indication into a generic term, does this amendment apply?

[Lord Johnson of Lainston (Con)]

I thank the noble Lord for that point. I am very comfortable having a more detailed discussion about GIs in principle. It is worth noting that many countries, including those in the CPTPP, do not have necessary GI processes. Sadly, too few do, so there is a great push on behalf of this Government to ensure that we advance the cause of geographical indicators to ensure that our rights are protected. It is correct that it is possible for a name change to be rejected; it is a process that takes time, as with any intellectual property issue. It is a detailed and thorough process to ensure that we can be comfortable that names, trademarks, GIs and so on are properly protected, and the research has been done. It can be six months or it can be a year, which is why we have built in this provision to ensure that it is the point of application rather than the point of approval that the data is referring to. That makes sense.

There have not been any cancellations of GIs undertaken by this Government, or indeed recently. I will check that, but I hope I am accurate; if I am not, I will certainly correct myself in the Library. The question from the noble Lord is about whether this is something that happens regularly, and is a constant and ongoing issue. Maybe there have been one or two exceptional examples but as far as I am aware, it is a relatively straightforward process; it seems quite uncontentious so far.

These regulations simplify the processes in respect of how we operate with the CPTPP. Often, we look at the activities that will take place in this country, which is right. How to protect our own GIs is what we are working on domestically. Really, this allows us to export the whole principle of geographical indicators—the wonderful concepts of Scottish salmon and Scottish whisky, to name just two enormously important and well-branded products. It allows us to work with our partner countries in the CPTPP to ensure that those brands and concepts are well protected, because a GI does not give us any strength unless it is domestically registered and the domestic legal system respects these principles. I therefore hope very much that the House will support me on this technical amendment and on the principle that it projects.

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[Lord Berkeley of Knighton (CB)]

My Lords, on the whole I tend to support the idea of having one’s sparring partners join the club, because there is then a way to communicate. The noble Baroness, Lady Kennedy of The Shaws, made this point. Communication is incredibly important, such as through cultural and sporting exchange.

However, the points made by my noble friend Lord Alton seem to me to rather trump that consideration. The noble Lord, Lord Hamilton, said that we would be making an exception in the case of this country. But why would we make an exception? I suggest that the answer lies in my noble friend’s point that the country has behaved exceptionally and therefore that we have to take that into account.

Finally, I say that we must learn from the Post Office affair, for example, which we will come on to, that we can never probe enough—we need to look at things in depth, especially something such as this where there are clearly areas that we could consider more thoroughly. I repeat what the noble Lord said: this is a plea to look further. It is not doing anything else at this stage. It asks the Government to allow us to look further at something that has considerable consequences.

[Lord Leong (Lab)]

My Lords, I thank all noble Lords for their contributions and the noble Lord, Lord Alton of Liverpool, for presenting this amendment calling on the Secretary of State to publish a report assessing the potential impact of China’s accession to the CPTPP on the United Kingdom and saying that both Houses of Parliament must be presented with a Motion for resolution on the said report.

As the noble Lord, Lord Lansley, indicated earlier, we on this side of the House would have preferred this amendment to cover all new accession countries—but for the purposes of this amendment I will refer just to China. Several noble Lords spoke in Committee on the case for this amendment and I do not propose to repeat what was said. However, I will make noble Lords aware of China’s non-market trade practices and its history of using economic coercion against CPTPP members, which must be considered in any valuation of its prospective accession.

First, there are aggressive military exercises and drills in the Taiwan Strait that threaten peace and stability in the South China Sea. This could be destabilising to regional trade. In addition, China has ongoing territorial disputes with other CPTPP members, including Japan, Malaysia, Brunei and Vietnam. Its willingness to use coercion against countries that disagree with it has often strained relationships with several CPTPP members. For example, it halted imports of Canadian canola and meat products in response to the arrest of a Huawei executive in Vancouver. Japan was denied access to rare earth materials in 2010 and Australian exports have suffered from Chinese import bans. Furthermore, several CPTPP member states have expressed concerns that China’s subsidies of state-owned firms and arbitrary application laws would be likely to make it hard for the country to join the trade pact.

I wanted to quote two examples, but the noble Lord, Lord Alton, mentioned the Japanese State Minister, so I will leave it at that and bring in another example of our very own British CPTPP trade negotiator, Graham Zebedee. Without commenting specifically on China’s application, if a country’s economic rules are really quite far apart from what CPTPP says, inevitably there is quite a big question about whether they could undertake really massive reforms. These concerns alone seem to provide sound justification for the commissioning of a report and Motion for resolution, as required by this amendment, so that both Houses of Parliament have the opportunity to fully consider the case for and against China’s accession to the trading bloc.

Recent newspaper reports have shown the lengths to which President Xi will go to crack down on companies when strengthening his control of the economy. Business leaders in China are under immense pressure. Last year, more than a dozen top executives from sectors including technology, finance and real estate went missing, faced detention or were accused of corruption practices. China’s national security law, as mentioned by my noble friend Lady Kennedy, is dangerously vague and broad. Virtually anything could be deemed a threat to national security under its provision and it can be applied to anyone on this planet. This law has provided little or no protection to people targeted. Lawyers, scholars, journalists, pastors and NGO workers have all been convicted of national security offences, simply for exercising their freedom of expression and defending human rights. Business leaders may face the same treatment.

China’s current policies and practices are at odds with many of the provisions and requirements of the CPTPP, and it is unlikely to be able to conform to them unless current members agree to significant concessions in the negotiations. This is why concerns about coercion are particularly relevant. Without considerable concessions, it is hard to see how China would qualify for accession. Equally, China is highly unlikely to make the changes to its laws and regulatory systems that would be required to gain the acceptance of CPTPP.

We are obviously sympathetic to the arguments made by the noble Lord, Lord Alton, and others in support of this amendment. However, there is not yet any agreement for any other country to join the partnership. It would be improper to single out any one of the possible new members at this stage, including China. At Second Reading and in Committee, we put on record our strong concern about China’s human rights record, but we believe that our human rights concerns should be universal and that one country should not be singled out. Should the noble Lord, Lord Alton, decide to divide the House on this amendment, we will abstain.

[Lord Johnson of Lainston (Con)]

My Lords, I am grateful for this debate and I have the greatest respect for my noble friend Lord Alton, who, over the years, has demonstrated his significant level of passion on this very important matter, as have many other noble Lords today. I do not want to deviate from the important points I wish to make relating to this CPTPP Bill, so forgive me if I do not necessarily answer all the questions that have been presented in relation to some of the topics raised. However, I would like to say, very importantly, that I clearly personally strongly reject the sanctioning of our parliamentarians. We have made it very clear before that China’s attempts to silence those highlighting human rights violations at home and abroad, including, and specifically, their targeting of MPs and Peers here in the UK, are unwarranted and unacceptable. I begin discussion on this amendment with that very important statement.

I turn to the debate around the CPTPP. As I have made clear throughout the last few stages of this Bill, in joining CPTPP, we are securing our place in a network of countries that are committed to free and rules-based trade, which has the potential to be a global standard setter. CPTPP acts as a gateway to the dynamic and fast-growing Indo-Pacific region and delivers on last year’s integrated review refresh to continue to enhance our relationships in that region. I stress this point, which was raised, I believe, by the noble Lord, Lord Purvis. Expansion of this agreement’s membership will only bring further opportunities for British businesses and consumers.

On potential new accessions, there are currently six economies with applications to join the group: China, Taiwan, Ecuador, Costa Rica, Uruguay and Ukraine. China’s application, alongside the applications of the other five economies, is at the outset of the application process and has certainly not been determined. As noble Lords are already aware, the CPTPP is a group of 11 parties and will become 12 when the UK accedes, and decisions must be taken by consensus of the CPTPP parties. However, it has been agreed within the group that applicant economies must also meet three important criteria: they must meet the high standards of the agreement; they have to have demonstrated a pattern of complying with their trade commitments; and they must command consensus of the CPTPP parties. These are very strong criteria, and I hope that all Peers on all sides of the House hear this very clearly.

As a new member of the CPTPP group, it is right that we work within the principles of the group to achieve a consensus decision, rather than give our own individual narrative on each applicant, such as through the report proposed in this amendment. My kinsman and noble friend Lord Hamilton made a very strong point in support of that. As I indicated previously, the UK is already closely involved in discussions on this topic but will have a formal power to oppose an application only post-ratification. It is therefore crucial that we ratify the agreement and become a party, so that we can work with CPTPP members decisively on each current and future application. I stress that to be drawn in on individual applicants now, ahead of the UK becoming a party to the agreement, could risk significant repercussions to our own ratification, which is why this is such a sensitive and important issue.

The UK becoming a party of the CPTPP is dependent on CPTPP parties individually choosing to ratify the UK’s accession, so it is not in our interests to step outside the group on such a sensitive issue. As I have been clear throughout our debates, we must join first so that we are on the inside judging other applications, not vice versa. It is therefore crucial that the UK ratifies the agreement, which will in turn trigger other ratifications that will allow us to become a party.

I want to be clear that our own accession working group was successful because we are demonstrably a high-standards economy with a strong track record, we made a market access offer of the highest standard, and we garnered the support of every party for our accession. Our accession process has set a strong precedent: the robust experience the UK has been through has reinforced the high standards and proved the bar is not easy to meet.

Comments were raised about state-owned enterprises. I will give noble Lords an anecdote from the negotiating team, as I understand it. We received a great degree of scrutiny over the relationship between Channel 4 and the Government, which few people, I think, would necessarily equate with the concept of a state-owned enterprise. I hope that that demonstrates the sort of inquiry that was behind our own accession.

I also reassure the noble Lord, Lord Alton, and everyone else who participated in this debate, that the accession of new parties after the UK has joined will entail a change in the rights and obligations of existing parties. Any new agreement requiring ratification by the UK would therefore be subject to the terms of the Constitutional Reform and Governance Act 2010. So, if he will allow me, I push back against the noble Lord and his suggestion—I think the noble Lord, Lord Purvis, also suggested it—that there is no track for the CRaG process to be triggered should a new party be able or about to accede to the CPTPP.

--- Later in debate ---

[The Earl of Clancarty (CB)]

My Lords, I rise briefly in support of Amendments 7 and 8 from the noble Lord, Lord Foster. I will say only one thing on the concerns about performance rights, because the noble Lord, Lord Foster, summarised the problem very comprehensively. Before I do, I wish to thank the Minister for his extremely prompt reply by letter to our concerns on the artist’s resale right in relation to the CPTPP that we discussed in Committee and for agreeing so quickly to set up a meeting on this, which I believe will take place on Monday. I look forward very much to that.

The single thing I will say about performance rights in relation to this Bill is to iterate a concern that Music Week, in response to the IPO consultation, raised yesterday. It highlights the importance and principle of reciprocity that the noble Lord, Lord Foster, mentioned. My understanding is that, until now, performance rights have been based on the principle of equitable remuneration, but this Bill potentially puts that in danger. There is a fundamental question—as the noble Lord, Lord Foster, said—to be asked about why the music and broadcasting industries are being put through the wringer on this when they are broadly happy with the status quo. If—and it is an “if”, because there are a number of options—the Government go down a particular route whereby, because of a reduction in the money going to US labels, US music is effectively free to play in the UK but UK music, particularly new UK music, is not, the concern is that, to quote Music Week,

“domestic acts might be squeezed out by UK broadcasters looking to save money”.

I hope the Minister will agree that that kind of asymmetric, or inequitable, scenario is one that needs to be avoided—although I am sure that that point and more will be made by interested parties in response to the consultation, which I hope that the Government will look at very closely.

[Lord Leong (Lab)]

My Lords, I am speaking to Amendments 7 and 8, and I thank all noble Lords for their contributions.

Intellectual property, particularly copyright, plays a pivotal role in the global trade in creative content, with the UK music industry serving as a prime example of its significance. It is imperative to acknowledge the substantial impact of copyright on fostering innovation and ensuring the efficient operation of markets. Additionally, it is crucial to recognise existing obligations under international copyright treaties and ensure their full and correct implementation by the signatories of the CPTPP. While the fundamental rights encompassing reproduction, broadcasting, communication to the public and distribution are addressed within CPTPP, it is disheartening to note that member states retain the option to opt out of certain obligations. Furthermore, the non-recognition of copyright protection for the utilisation of recorded music in broadcasting and public performance remains a regrettable challenge. To comply with obligations in the CPTPP, as mentioned earlier by the noble Lord, Lord Foster, changes need to be made to UK legislation with regard to rights in performance. We share some of the concerns in the noble Lord’s contribution earlier, and we would welcome an impact assessment to help us understand some of these non-compliance cases.

Will the Minister respond to the following questions, as mentioned earlier by the noble Lord, Lord Foster? Why is the extension of rights in sound recordings and performance to foreign nationals not covered under this consultation? At the same time, can the Minister share with the House when the results of this consultation will be published? Will there be a statement on collective management organisations, given their importance for the income of composers, performers and rights holders? Can the Minister also confirm that UK musicians are able to tour throughout CPTPP member states without any barriers and checks?

[Lord Johnson of Lainston (Con)]

I am extremely grateful to the noble Lord, Lord Foster, for bringing this amendment, for the discussions and dialogue we have had, for the correspondence I have enjoyed with the noble Earl, Lord Clancarty, and for the excellent summation by the noble Lord, Lord Leong—I was about to say “my noble friend” because he is a good friend—who asked some key questions. I am afraid I do not have the answer to the final question that the noble Lord, Lord Leong, asked about the touring rights of artists. I will write to him on that; it is a very good point, and we very much hope that clearly the additional facilities that we have, in terms of temporary business entry for CPTPP countries, may include this. I hope it will and I will confirm this.

Some good points have been raised. In response, first, I will say that the desire to treat performers equitably is the right thing to do. Currently, there are a number of performers who are excluded from receiving the 50% mandatory royalty payment, simply because they come from another country or their work has not been registered in the appropriate fashion. The consultation, which started yesterday and will report on 11 March, is not specifically a consultation on the CPTPP, because we wanted it to be a far wider consultation around the principles of broadcast rights—but clearly it will reflect on the discussion we are having now.

Conduct of Employment Agencies and Employment Businesses (Amendment) Regulations 2022

Lord Leong Excerpts

Tuesday 19th December 2023 Lords Chamber

[Lord Offord of Garvel (Con)]

I think the decision was made on the basis that the court decided that full consultation had not taken place on what we would all agree is an important matter in employment law. It was quite legitimate to say that the consultation should be rerun. It was decided not to appeal the decision—so public money was saved in that regard—but that the consultation should be now run in the ordinary course.

[Lord Leong (Lab)]

My Lords, first, I thank the noble Lord, Lord Balfe, for his support and his dogged opposition to this terrible legislation. I want to state again that employers do not want it, trade unions do not want it and the High Court has ruled against it, so what are these exceptional circumstances that the Minister has just mentioned?

[Lord Offord of Garvel (Con)]

There are legitimate circumstances where a company wants to fulfil its orders and contracts, and look after its clients, and, for whatever reason, it can find agency staff but the workforce do not want to work. I agree that it is an unusual situation. All this is doing is trying to balance the rights of employers and employees.

Trade (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) Bill [HL]

Lord Leong Excerpts

Committee stage
Thursday 14th December 2023 Grand Committee

Moved by

[Lord Leong]

17: After Clause 5, insert the following new Clause—
“Report: accession of the People’s Republic of China to the CPTPP(1) Before any decision is made by the Government of the United Kingdom on the accession of the People’s Republic of China to the CPTPP under Chapter 30 of the CPTPP, the Secretary of State must publish a report assessing the impact of China’s accession on the United Kingdom.(2) Both Houses of Parliament must be presented with a motion for resolution on the report under subsection (1).”

--- Later in debate ---

[Lord Leong (Lab)]

My Lords, I speak to Amendment 17, which was tabled by the noble Lord, Lord Alton, who is unable to introduce the amendment due to a long-standing commitment. The effect of the amendment would be quite simple. Proposed new subsection (1) would require the Government to produce a report on the impact of the People’s Republic of China joining the CPTPP, before any decision is made as to whether the UK could support the PRC’s accession. Proposed new subsection (2) would provide for a vote in both Houses on the UK’s position towards the PRC’s membership.

I do not believe that this amendment ought to be controversial. The prospect of the UK joining a trading bloc with China—one that has the potential to be the largest FTA zone, accounting for 53% of global GDP and 30% of global trade—has significant long-term implications for the people of the United Kingdom and beyond. As such, it ought to be a matter for parliamentary oversight.

I believe that the PRC should not be allowed to accede to the CPTPP, but it has become clear that what seemed like an impossibility a couple of years ago looks more and more possible. After the UK, China is next in line. China is a much more important trade partner for many CPTPP members. Close economic ties have already persuaded some CPTPP members, such as Singapore, Malaysia and Vietnam, to voice their support for China’s entry. Australia, which previously opposed it, has reportedly softened its opposition and Beijing is lobbying hard for membership.

There are three key reasons why the PRC should be kept out of the alliance, and why the UK must not be bounced into a position of support without the support of Parliament. First, China should not be admitted because it will not meet CPTPP standards. The CPTPP contains major commitments on labour, the environment, IP and state-owned enterprises regulations that China is unable to meet. As my noble friend Lord McNicol has already said, Article 19.3 incorporates the International Labour Organization’s Declaration on Fundamental Principles and Rights at Work and Its Follow-up of 1998, which provides the right to freedom of association and prohibits all forms of forced labour, child labour and discrimination in respect of employment. To further entrench these rights, Article 19.4 explicitly prohibits members derogating from these protections, meaning the labour laws cannot be weakened to encourage trade or investment.

The CPTPP also establishes a number of positive environmental obligations for members. Under Article 20.3, members must effectively enforce environmental laws and must not derogate from them to gain a trade or investment advantage. The environmental chapter is enforceable under the CPTPP’s broader dispute resolution mechanism. The CPTPP also recognises the sovereign right of each party to establish its own level of domestic environmental protection. Although China has recently made important efforts to address environmental concerns, including by announcing its goal to phase out coal investment abroad and by debuting its emissions trading system, CPTPP obligations may none the less prove onerous, given China’s status as the world’s largest emitter of greenhouse gases and the challenges it faces reconciling climate and pollution control with rapid economic development.

China will also be unable to meet the CPTPP’s data transfer obligations and standards, which eliminate data localisation and prohibits Governments of CPTPP members demanding access to an enterprise’s source codes as a condition of import, distribution or sale. Importantly, these provisions are subject to the CPTPP’s dispute settlement mechanism. Further, a national security exemption is not allowed to let members derogate from this regulation. Although China has made similar commitments on data transfer and data localisation, as a member of the Regional Comprehensive Economic Partnership, or RCEP, this agreement does not contain a provision prohibiting the forced transfer of source codes. Additionally, the RCEP’s digital trade provisions are not subject to dispute settlement, and members may use a self-judging national security exemption to circumvent these requirements.

Secondly, should China join the CPTPP, it would definitely block Taiwan’s participation, as it did with RCEP. Given Taiwan’s importance in the supply chain network, the island’s exclusion from the CPTPP will have significant implications for the restructuring of the global production network and for the setting of standards in key industries and technologies where Taiwan is the leader. Further weakening and isolating Taiwan is neither in the interests of the people of Taiwan nor aligned with the interests and values of the United Kingdom and our regional allies.

That brings me to the third reason why China should be kept out of the CPTPP. Accession will make China more powerful and increase its willingness and ability to act coercively. China’s joining of the CPTPP will not only expand the CPTPP’s weight in the global economy but increase its global influence. A significant driver behind the CPTPP was the region’s recognition of a need for an alternative to be able to de-risk from an overreliance on China. This is good practice.

The United Kingdom played a key role in supporting China’s accession to the WTO, which I firmly supported. China pledged upon its accession to adhere to WTO rules, to phase out subsidies, and to ensure fair competition. It promised that the state would not influence commercial considerations. As we were reminded by the US trade representative in 2021:

“After more than 20 years of WTO membership, China still embraces a state-led, non-market approach to the economy and trade, despite other WTO Members’ expectations—and China’s own representations—that China would transform its economy and pursue the open, market-oriented policies endorsed by the WTO”.


Good faith may have been reasonable 20 years ago. Sadly, China has changed, as has its global ambitions. We simply cannot afford to get it wrong again.

In closing, I urge us all to recognise the importance of the CPTPP to the United Kingdom’s future economic and geopolitical importance and interests, and to support this amendment, which would ensure parliamentary oversight of the UK’s position on China joining the CPTPP.

--- Later in debate ---

[Lord Leong (Lab)]

My Lords, I beg noble Lords’ patience as I share my business experience of doing agreements in China. I still have scars on my back. My first visit to China was in 1999, when I was a much younger law publisher. This was before China’s accession to the WTO. It wanted to acquire the subsidiary rights to every mercantile law—what a beautiful name—and commercial and international law book. I was happy to enter into agreements with various Chinese university presses. Noble Lords will know that most businesses in China are wholly or partially owned by the state, so you can enter an agreement in good faith but whether the agreement is abided by or complied with is a different conversation. After many years of doing business in China, the managing of agreements took its toll and eventually we stopped doing business there.

I will share a simple analogy with noble Lords. It is as if you allow a friend into your house and then suddenly notice that some things have been taken away. Much later, more valuable things are taken away, and then the friend starts dictating the terms of your stay in your own house. I beg leave to withdraw the amendment.

Amendment 17 withdrawn.

Retained EU Law (Revocation and Reform) Act 2023 (Consequential Amendment) Regulations 2023

Lord Leong Excerpts

Wednesday 13th December 2023 Grand Committee

[The Minister of State, Department for Business and Trade (Lord Johnson of Lainston) (Con)]

My Lords, these regulations were laid before the House on 16 October 2023 under the Retained EU Law (Revocation and Reform) Act 2023. The retained EU law Act brought about significant changes to the domestic body of law named retained EU law. First, it provided that EU interpretive effects would cease to apply to UK legislation at the end of 2023. Secondly, it provided the Government with powers to revoke, reform and amend retained EU law more easily. Finally, to reflect the loss of interpretive effects, it provided that “retained EU law” would be renamed “assimilated law” at the end of 2023. Therefore, the Government are bringing forward this instrument to ensure that references to “retained EU Law” in primary legislation are changed to “assimilated law”, and to make related consequential changes.

The SI will enact consequential amendments to 107 pieces of primary legislation in order to implement the renaming of retained EU law as assimilated law and to make related textual changes. These changes reflect what has already been agreed to by Parliament as part of the passage of the REUL Act. This SI simply implements consequential changes that both Houses have already agreed. For example, the SI states that, in Section 4B(3A) of the International Organisations Act 1968, “retained EU” should be substituted by “assimilated”. The changes are necessary to ensure that the statute book reflects the REUL Act and to provide legal clarity and accessibility to users of legislation.

The SI will make technical amendments to Acts of Parliament containing areas of devolved competence, including making changes to Northern Ireland primary legislation. I am pleased to confirm that the Welsh and Scottish Governments have provided consent, as has the Northern Ireland Civil Service in the absence of an Executive and Assembly. I thank officials for their close working and collaboration on this matter.

It is worth noting that this SI is a standard example of using a consequential power. These powers are common in many Acts. They simply allow the Government to make consequential amendments to legislation that both Houses of Parliament have already passed. The fact that we are debating such technical changes as this demonstrates the Government’s commitment to ensuring proper scrutiny for all statutory instruments laid under the REUL Act.

Finally, although this SI does not enact reform or make any policy changes, the Government’s commitment to reform remains unchanged. Our priority is to bring forward reforms that will unlock innovation, reduce burdens for business and ensure that our regulations are the best fit for the UK. I am the Government’s lead on smarter regulation, so reforming our regulations is a personal priority for me. I look forward to sharing additional reform SIs with the House in coming months.

With all that in mind, the principles behind the changes we are proposing today have already been agreed by both Houses as part of the passage of the retained EU law Act. These changes are necessary to ensure that the statute book reflects the provisions enacted by that Act and to ensure that the terminology is consistent throughout primary legislation on our statute book. Nothing that this SI does will enact policy changes. I beg to move.

[Lord Leong (Lab)]

My Lords, I confess I struggled to find the controversy in this statutory instrument. All it actually does is bring into effect the use of the phrase “assimilated law” instead of “retained EU law”. Paragraph 7.1 of the Explanatory Memorandum states:

“This instrument does not result in any change in policy effect, but rather provides clarity to users of legislation that the specific changes made by the REUL Act have taken effect—thereby helping to further modernise our statute book and improve its clarity and accessibility for businesses and consumers alike”.


It is basically a linguistic update. We on this side of the Committee very much welcome any bit of clarity and assistance that can be offered to business. From what we can see, it certainly is not a controversial statutory instrument. On that basis, we will support it.

[Lord Johnson of Lainston (Con)]

I thank the noble Lord, Lord Leong, as I always do, for his wise words. I will say no more than that.

Employment Rights (Amendment, Revocation and Transitional Provision) Regulations 2023

Lord Leong Excerpts

Wednesday 13th December 2023 Grand Committee

Other than that, I echo the points made by both the noble Lords, Lord Hendy and Lord Davies, on concerns about the reduction of workers’ rights more generally, which I believe we need to be concerned about.

[Lord Leong (Lab)]

My Lords, I thank the Minister for introducing the regulations, and all noble Lords who contributed to this debate. It is a pleasure to see my noble friend Lord Stansgate and welcome him to the chair.

As we have heard, this instrument does three main things. It reduces requirements under the working time directive, simplifies annual leave and holiday pay calculation and streamlines the regulations that apply when a business transfers to a new owner. This results from the retained EU law Act removing the interpretive effects of EU law on the UK statute book.

As my noble friend Lord Hendy mentioned, during its passage through the House, many of us on these Benches made it absolutely clear that the Act should never be a vehicle for the removal of important existing rights of British citizens. The Government seek to assure us that these changes do not amount to that, and that they simply remove extra bureaucracy. However, in my relatively short time in this place, I have learned to be wary of such assurances. It is said that the devil definitely lies in the detail. However, accurate records leading to accountability surely should not be seen as an evil in itself.

First, I turn to the change to the working time regulations. This represents the greatest risk to workers’ protection. It means that businesses will not have to keep records of their workers’ daily working hours if they can demonstrate compliance without doing so. Will the Minister accept that removing the requirement for accurate record-keeping, tilting the balance of power away from workers to the employer, in fact removes workers’ rights, not unnecessary bureaucracy?

The Explanatory Memorandum says that the instrument will “remove the uncertainty”, without quite explaining what this actually means. The Government argue that the obligations were disproportionate and could damage relationships between employers and workers. Can the Minister expand on how removing clarity could damage this relationship and do anything but actually increase uncertainty? Can he also explain how businesses will demonstrate compliance without records and how a lack of compliance could be evidenced or enforced? Can he expand on the implied relationship between recording working hours and reducing economic activity, or is he prepared to accept that such a correlation does not in fact exist?

Secondly, the instrument provides a simplification of annual leave and holiday pay calculations. In all my years of owning and managing businesses and employing thousands of employees, I have never seen such a complicated system—so much for reducing unnecessary bureaucracy. Can the Minister guarantee that, as a result of this regulation, no workers will lose out on the annual leave and holiday pay to which they are currently entitled?

Finally, I turn to rights under the Transfer of Undertakings (Protection of Employment) Regulations —TUPE. My noble friend Lord Davies of Brixton eloquently set out why this change is totally unnecessary. As TUPE transfers currently stand, employers must inform and consult with representatives from a trade union or, if there is none, other employee representatives. Employers can inform and consult directly with employees only if there are fewer than 10 employees in the organisation. This instrument will amend TUPE consultations so that they can take place directly with employees in the absence of existing representation, if either the company has fewer than 50 people or the transfer involves fewer than 10 employees. This clearly represents a reduction in the existing rights of workers in such organisations. Can the Minister confirm whether ACAS has been consulted on these changes? I look forward to his response.

[Lord Johnson of Lainston (Con)]

As always, I thank noble Lords for their valuable input in this crucial statutory instrument debate. I also join in the thanks to the noble Viscount, Lord Stansgate, and welcome him to his position.

I will try to go through the various points raised, beginning with those of the noble Lord, Lord Hendy; by answering some of his questions, I will have a chance to answer others as well. The point about rolled-up holiday pay is important because, if you are an irregular-hours contractor and you work for an employer for a very short period of time, for example, it would be impractical for you to take a fraction of a day’s holiday paid in that way. It is much more reasonable, useful and suitable for the employee to have their holiday pay rolled up into the work they are doing.

This is important, and we consulted on whether we should bring it in for all employees in the UK. We decided that that was very much not the right thing to do, precisely for the reasons raised by the noble Lord: it is essential, in many respects—in order to have a good and functioning workforce—that holiday is taken at the right time and that people have the right level of rest, let alone in relation to the implications for health and safety. As a result, this only applies to part-year and irregular-hours workers. Whether the employees wish to receive their pay in that way is at the discretion of the employer, in consultation with them. From my point of view—I have been an employer—this strikes me as eminently reasonable. It does not necessarily change anything significant; it just clarifies the important point about how that can be rolled up. We also brought in important clarifications between part-year workers’ holiday entitlements and irregular hours workers’ holiday entitlements, which now bring them into line. Again, this is about fairness, which I know that the noble Lord is keen on.

On record-keeping, it is relevant to mention the court case that has been referred to: CCOO v Deutsche Bank—I will use the acronym “CCOO”, rather than try to pronounce the full name. It is important to note that we are not changing anything at all. I am not sure whether noble Lords realise that this was never implemented in the UK, so the point is that we will not implement it in the UK and it is currently not implemented. Tomorrow morning, or whenever the statutory instrument comes into effect, there will be no change in employment systems for any company—no one would see any difference—because we are not implementing this necessity to track every minute of every worker’s day. Instead, employers will have the rights that they have today, so if we are comfortable—which we are—with the obligations that employers have to confirm under the working time directive, we should be very comfortable with where we are.

We believe very firmly that bringing in this necessity would in many instances be unnecessary. This does not relate to making sure that irregular-hour workers, workers in part-time roles or those who work complex shifts, and so on, have worked the right amount of time. In most instances, this is for regular office-hours workers who work roughly nine to five; to have them clocking in and out, and having complex systems monitoring them, is entirely unnecessary. We do not do it now and do not see why we should do it. We think that the cost to industry in this country could be much as £1 billion in terms of new systems and familiarisation.

The noble Baroness, Lady Brinton, mentioned Ukraine. The consultation referred to the fact that in a cost of living crisis, and with other global headwinds and challenges, it would seem unnecessary and wrong to impose burdens on businesses that we are not already imposing on them. There is nothing to lose. It is important to be reassured that employers’ obligations have not been changed. There are no changes as a result of this instrument. It simply ensures that we do not have to conform to unnecessary and restrictive paperwork-oriented activities.

The noble Baroness, Lady Brinton, also raised an important point about the use of AI and technology. I completely agree with her raising those points. I do not think it is in doubt that employers will want to use AI to ensure that they are conforming to their obligations and that their workforces are properly managed, but we should not forget that it is important that we respect small businesses in this country, which may not have the time or capital to invest in such systems. In most of these instances, we think it is unnecessary. I believe that, collectively, we are doing a sensible act in not implementing this judgment, by keeping things as they are and ensuring that workers are protected. Employers have obligations and we are allowing the system to function appropriately.

The third point covered by noble Lords was on TUPE. I know that the noble Lord, Lord Hendy, has been described as the barrister champion of the trade union movement, and it is a title of which he should be proud, but this relates to organisations with fewer than 50 employees—currently, it relates to organisations with fewer than 10 employees—who do not have a representative force in place. While he is indeed the barrister champion of the trade union movement, it may surprise him to know that some companies do not have trade union movements or representative organisations in them. We find ourselves in a bizarre situation where small companies with few employees are obliged to have elections for representative organisations that do not exist. Even in the world of the noble Lord, that would seem bizarre, unnecessary and indeed unkind to small businesses. It does not at any point derogate the rights of employers when it comes to TUPE transfers where there are representative organisations.

The noble Lord, Lord Leong—perhaps it was the noble Baroness, Lady Brinton, or the noble Lord, Lord Davies—rightly raised whether this can be used as a way round, so that large companies transferring small units to other companies could do it piecemeal, say 10 employees at a time. I do not believe that that would be the case. The obligations of an employer under TUPE regulations—the liabilities accruing to them—have not changed in any material way whatever. Tribunals where they could be found at fault would clearly see through such a plan. I am sure noble Lords know that when you buy businesses that are relevant in terms of team transfers to other companies, it simply does not work in that way, so I do not believe there can be an abrogation of rights.

Let me give an example, which I am sure noble Lords will agree is common sense: if you are transferring a small unit of two people, I understand that you are currently obliged to have an election and a representative for two people who are not members of a union and do not have a representative organisation. That does not mean they cannot receive external advice; of course, we would always advise people to receive the advice they need. In this instance, we are clarifying the situation, simplifying it and making it completely reasonable. At no point are we rolling back on any of the workers’ rights that we hold so strongly in this country and which we are committed to, either through trade agreements with Europe or any agreements that we have undertaken.

Genuinely, I have looked very carefully at each aspect of this statutory instrument and think it is a welcome tidying-up of paperwork and bureaucracy, alleviating burdens on businesses while at the same time simplifying the rights of workers and ensuring that the economy can function effectively. I commend this instrument to the Committee.

Workers’ Rights

Lord Leong Excerpts

Thursday 23rd November 2023 Lords Chamber

[Lord Johnson of Lainston (Con)]

I am delighted to be taking through the CPTPP Bill, of which one of the key tenets is ensuring that musicians receive a fair proportion of the money they earn from broadcast media. This is just one of the many areas that we are focusing on, and I will also mention the support allocated in the Autumn Statement yesterday to the creative industries in general. We make all the great films in the world here, including “Barbie”, and I hope that will continue, whether you are a self-employed musician or part of a larger organisation.

[Lord Leong (Lab)]

My Lords, I will follow on from my noble friend’s supplementary question. On Tuesday this week, the Supreme Court ruled that Deliveroo drivers are not entitled to certain rights, including unionisation, because they are considered to be self-employed and not workers. Do the Government have any plans to protect the growing number of workers in the gig economy, rather than allowing multinationals to dodge basic employer obligations by pretending that some of these lowest-paid workers are able to exercise their freedom to turn down work?

[Lord Johnson of Lainston (Con)]

The Government have done a huge amount to ensure that principles such as zero-hours contracts can remain flexible, allowing millions of people to do the work they wish to do and allowing students to participate in the workforce, while ensuring that they have the right levels of protection for holidays and other crucial concepts in workers’ rights. It is important that we have a strong economy, which will enable people to have these jobs. I remind all noble Lords that we have increased the number of employed people by over 3 million since we came to power in 2010.

National Minimum Wage (Amendment) (No. 2) Regulations 2023

Lord Leong Excerpts

Tuesday 14th November 2023 Grand Committee

[Lord Leong (Lab)]

My Lords, I thank the Minister for the overview and explanation of the statutory instrument. We on this side very much welcome this instrument. I thank my noble friend Lady Donaghy for her contribution and for bringing us up to speed on what happened 25 years ago.

As many noble Lords know, the national minimum wage was introduced on 1 April 1999 by the last Labour Government. It creates an obligatory threshold pay level. At the time, the party opposite argued that it would cost millions of jobs, but, 25 years later, this has not happened. In fact, the national minimum wage has had negative effects on the overall UK labour market. Today, around 1.6 million workers—roughly about 5% of all UK workers—are paid at or below the minimum wage. When there is such high inflation and a sustained cost of living crisis, this is just not good enough. Employers should be encouraged to recognise that making work pay with a real living wage and strong workers’ rights is good for growth and for the economy.

This statutory instrument removes the option for a person who resides in a domestic family home, but who is not a member of the family, to be asked to do work in a household without remuneration. This means that a potential loophole by which the unscrupulous employer could require someone living with them and treated as a member of the family to unreasonably be expected to perform jobs in the home without being paid at all. From 1 April 2024, such tasks will now have to be paid at the relevant band of the national minimum wage.

Does the Minister have figures for how many employees —nannies, au pairs and other domestic workers—can expect their income to increase as a result of this change in legislation? Can he also indicate which channels or organisations the Government plan to utilise to alert affected workers to their new rights, especially as I imagine some may not be British citizens or have any union representation? Given the sensitivity of employee-employer relationships in a domestic situation, can the Minister inform your Lordships’ House what provisions are in place to support workers who might find themselves in vulnerable situations, or even potentially homeless, if their employer refuses to recognise their right to be fairly paid as a result of these changes, since their access to legal advice may be very limited? Finally, as well as making people aware of their rights and offering support when made aware, will there be any more proactive steps to ensure that as few people as possible slip through the cracks?

[The Earl of Minto (Con)]

My Lords, I thank noble Lords for their valuable contributions during today’s short debate. These regulations will reward low-paid live-in domestic workers right across the country so that they are paid fairly for the work they do. It will give more clarity on wage regulations for the families that employ these workers, making sure they are paid the national minimum wage. It will also ensure that HMRC enforces the national living wage and national minimum wage for live-in domestic workers, in line with other sectors. The legislation will ensure that all work is treated fairly, and it will end the misuse of the exemption to exploit workers, particularly migrant women.

I will now take the opportunity to answer some of the specific questions asked by noble Lords. The noble Lord, Lord Palmer of Childs Hill, said that this is only one of the unfair anomalies in operation at the moment. The Government accept that and are working as hard as they can to ensure that this is dealt with. The question about different ages and rates is certainly something that I have always found quite difficult to come to terms with—I always paid everybody the same amount, regardless of their age. I can see the argument for bringing people up to a certain level as they leave education and start building up to a full-time job while living at home. Certainly, the Government have moved to narrow the gaps and, as I said, the full national living wage is a significant salary—that is good news. I will write to the noble Lord about the issue of less universal credit. I do not think that it is our policy to take away universal credit, but I will write to confirm that that is the case.

The noble Baroness asked about au pairs. I am advised that there are still 45,000 au pairs in this country, which is a surprisingly large figure. Although it is a small number in the total scheme of the 1.6 million workers, this is an important step to take—I suspect there are a lot of other people who are not covered by the au pair qualification. Clearly, it is the responsibility of HMRC to police this, and it has been given a substantial increase in the funds it can address towards this area. As I said, it follows up every single report it gets about this. Of course, there is a link to slavery and all sorts of things, which one worries about deeply. On the accommodation off-set, I rather like the idea of the monastery. That does reduce the national living wage but at a reasonable rate—I think it is about £1 per hour at the moment, or something like that.

The point of the noble Lord, Lord Leong, about the 1.6 million was well made. The Government have been absolutely committed to the national minimum wage and the national living wage, and they will continue to drive that through as far as possible. We will certainly encourage employers to ensure that this amendment is widely known; I will write with the detail on that. Equally, we will take seriously support for workers, particularly those who are homeless. I hope that covers the specific points raised.

I conclude by extending my thanks once again to the Low Pay Commission—it is wonderful to have an original member in our company. Thanks to its independent and expert advice on this national minimum wage exemption, we can ensure that the right balance is struck between the needs of workers, affordability for business and the wider impact on the economy and the families involved. Again, we look forward to receiving its recommendations for the 2024 rates, which will be published later this month. I commend these regulations to the Committee.