Trade Union Bill

Lord Mendelsohn Excerpts

Tuesday 19th April 2016 Lords Chamber

Therefore, I welcome this debate and I hope that the Government will take up the noble Baroness’s suggestion—if not by accepting the amendment then by their deeds and practices in the future.

[Lord Mendelsohn (Lab)]

My Lords, I congratulate my noble friend Lady Prosser on tabling this amendment and on the very elegant adjustment to the amendment, which I think addresses some of the Government’s concerns. In keeping with the approach of the noble Lord, Lord Bridges, and the noble Earl, Lord Courtown, I hope that on this they will be even more in listening mode and that we might be able to make some changes on this. However, we are very grateful for what they have done thus far today.

The amendment raises an issue that I have been particularly exercised about during the passage of the Bill. I am not, and never have been, a trade unionist and I have never been a member of a trade union. I am a businessman and have been involved in business for most of my life when I have not been involved in politics. One area of the Bill that has always concerned me is that there has been a complete lack of appreciation of the significance of the function and role of management. These things are tremendously important, and the amendment provides an important message that I hope the Government will be able to find ways to reinforce. The message is that engagement between management and employees is a key lever in making a difference in companies and a key mechanism of performance.

Much of the Bill addresses the problems of yesteryear, but I hope that we can start addressing the problems of the future, including how we optimise our performance in all areas, especially in business. Other places have made leaps and bounds in their public sector organisations and private sector companies through effective business process redesign, and it worries me hugely that we have not done as well here because we do not engage with employees as well as other places have shown is possible. In that area, we have a huge amount to do. That is why this sort of provision and process is important. We cannot forget the role of good management and good leadership in being able to make the sorts of changes that we want.

When we look at our public services and at the sorts of companies and adaptabilities that we want, we have to recognise that there is a massive role for management and leadership. I have never known of employees not wanting to engage with their management and leadership, and, apart from in the depths of some disputes, I have never known of trade unions not wishing to engage with management and leaders. But I have known far too many examples of when the management and leadership of companies have not taken that opportunity or not done it well enough. It would be very encouraging if the Government were to do something to ensure that people understood the importance of effective employee engagement and effective work with trade unions, which can make a huge difference to our country.

[Lord Dykes]

My Lords, I rise very briefly to congratulate the noble Baroness, Lady Prosser, on her proposed new clause. I hope that it will be fully and enthusiastically accepted in this debate today. This is a great opportunity to try to put right some of the deficiencies and weaknesses that we see even now in modern industrial relations in Britain, despite attempts at improvement from time to time.

The tragedy of the “them” and “us” disease—the two nations in industrial relations: the bosses and the employees—is still very strong. Incidentally, although this is not part of the Bill, the very fact that the highly paid executives who run companies are paying themselves far too much in comparison with what people earn on the shop floor is a very dangerous element that contributes to the anger and resentment that is felt in the great divide between the shop floor and the director’s boardroom. It is a great tragedy that, given the modernisation that we expected, with foreign companies coming in and all that the Japanese and Koreans have done to create a new, more modern system, we have not yet made sufficient progress. However, we are beginning to.

I remember vividly that when I was a Member of Parliament for Harrow, more than 30 years ago, I visited within eight weeks the Volkswagen works in Wolfsburg in Germany and British Leyland. British Leyland was going through one of its perpetual crises, mainly because of not the unions but the failure of management to engage their employees and to liaise with them properly. As you can imagine—I am not making this up—the meeting at the Wolfsburg Volkswagen works, one of the biggest motor works in Germany and the world in those days, started at 7.30 am. There was breakfast for an hour and a half, which was black coffee and black bread, and then a tour of the factory for two and a half hours. We then had an early lunch in the canteen, with the employees, directors and bosses eating at the same tables.

Some weeks later, I went to the British Leyland meeting, which, in contrast, started at 11.30 am. It was a half-hour visit to the factory, which was not very long, and we were told that we must make progress but could ask questions later. There was an hour of gin and tonics in the boardroom with the director—a very agreeable English habit that we have—and then a sumptuous lunch in the directors’ dining room, miles away from the workers’ canteen. That was a long time ago and I think that things have improved in many enterprises, so I should not decry that. But it is still not enough. There is still a sinister division between employees and employers in this country, and the pay gap is really menacing for the future of British society and its equilibrium. It has to be tackled one way or another—but that is not, of course, part of this Bill.

I very much agree with the remarks of the noble Lord, Lord Stoneham, and thank him for them. He has experience both of the corporate world and of assisting in trade union activities. He cast a warning about these matters, as did the noble Lord, Lord Mendelsohn. So the Government, having been in listening mode on some specific amendments to earlier aspects of the Bill, have a great opportunity now to re-educate some of their ministerial colleagues about these matters, because the “them” and “us” doctrine is deeply embedded among many Conservative Ministers still. That is a great tragedy for this country and does impede our efforts. We helped the Germans have a much healthier system when we were there as the occupying power after the war. What a great irony that was. So now we have an opportunity for Ministers to respond to these matters. This may be a very general matter and not a specific, technical amendment, but it is a very important new clause. I hope that the Government will respond very positively.