Lord Sharpe of Epsom
Main Page: Lord Sharpe of Epsom (Conservative - Life peer)Department Debates - View all Lord Sharpe of Epsom's debates with the Home Office
(1 day, 20 hours ago)
Lords ChamberMy Lords, the amendments in this group seek to address gaps in our current legislation by establishing clear exemptions from detriment protections when workers engage in unacceptable conduct during industrial disputes, while creating a comprehensive framework that restores balance to industrial relations.
I am willing to be corrected, but we do not believe that these specific protections against certain leverage activities currently exist in legislation, which is precisely why Amendment 252 is necessary. However, this forms part of a broader package addressing systemic failures in our industrial relations framework. In our assessment, leverage may manifest in various forms, but at its core lies a deliberate strategy to publicly intimidate and humiliate employers, compelling them to make concessions in industrial disputes that they would not otherwise consider. We fundamentally reject this approach as unacceptable in civilised industrial relations.
When describing leverage in the context of the Grangemouth dispute, Unite the Union explicitly stated:
“Leverage targets all areas of weakness of an employer … Leverage is the translation of an organising mind-set into the planning and implementation of a campaign strategy, underpinned by the escalation of pressure to create uncertainty”.
Even more concerning, Unite the Union expressed the view that in a leverage campaign
“the employer is routinely treated as a target to be defeated not a friend to be convinced”.
This adversarial approach treats employers as enemies to be vanquished, rather than as partners in resolving legitimate grievances.
Amendment 252 specifically identifies actions that constitute leverage: intimidation at picket lines; protests at company premises or the private homes of senior managers; the harassment of non-striking workers; and deliberate actions designed to undermine business continuity planning. Workers who engage in these intimidatory tactics should face the prospect of dismissal without recourse to employment protection.
However, the problems extend beyond leverage tactics. Amendment 251C responds to the troubling rise of wildcat strikes and unofficial action lacking democratic mandates. The Grangemouth dispute exemplifies this. Leverage tactics were employed in pursuit of objectives that may not have commanded genuine workplace support. If workers are to enjoy enhanced protections, those protections should be reserved for action properly sanctioned through domestic process under Sections 226 to 232 of current legislation.
Amendment 251G seeks to address the growing problem of co-ordinated action by workers outside of established collective bargaining frameworks. We have seen increasing instances of social media-organised workplace action that deliberately circumvents union structures and creates chaos for employers facing industrial action without recognised representatives to negotiate with.
Amendment 251D seeks to address the very real risk that, without proper definition, every minor management decision during a dispute could become grounds for a detriment claim. We have seen in other jurisdictions how broad definitions create litigation cultures, where employers face constant threat of claims for routine operational decisions. This amendment would prevent the trivialisation of genuine grievances while protecting employers from vexatious claims.
Our compensation framework amendments respond to documented failures. Amendment 251K would establish three bands of detriment severity—minor, serious and extreme—addressing the current lack of guidance that leads to wildly inconsistent awards. Amendment 251L would require proof of “actual financial loss”, preventing the speculative claims that proliferate without such requirements. Amendment 251N would restrict compensation to economic losses, preventing the concerning trend towards “injury to feelings” awards that represent a fundamental category error in industrial relations contexts.
Amendments 251E and 251F seek to address the stark reality that industrial action has already compromised public safety. During recent NHS strikes, emergency cover was inadequate, putting patients at risk. The 2019 London Underground strikes left commuters stranded, creating security vulnerabilities. Amendment 251E would provide essential legal clarity for employers who must prioritise continuity of critical operations. Without this protection, fear of litigation prevents necessary operational decisions. Amendment 251F recognises that some industrial action poses direct threats to public health and safety. Such considerations must take precedent over detriment protections.
My Lords, I thank the noble Baroness for her contribution, and I thank the noble Lord, Lord Sharpe of Epsom, for tabling these amendments. I ask noble Lords to bear with me as I respond to each of them.
I want to be clear about why this clause is required. Clause 73 inserts new Sections 236A to 236D into the Trade Union and Labour Relations (Consolidation) Act 1992. New Section 236A is required because the Supreme Court ruled in April 2024 that Section 146 of the 1992 Act is incompatible with Article 11 of the European Convention of Human Rights.
Amendments 251C, 251F, 251H and 251J are unnecessary as their purpose is already covered in existing legislation. In the case of Amendment 251C, Clause 73 already requires a ballot compliant with Section 226, as specified in Section 219(4) of the 1992 Act, and makes it clear that protection is limited to cases where the action is compliant. Furthermore, in the case of Amendment 251J, secondary action is already prohibited under Section 224 of the 1992 Act, and the new protection of Section 236A will not apply where the industrial action was unlawful secondary action.
With regard to Amendments 251F and 251H, Section 240 of the 1992 Act allows for criminal prosecution of those who intentionally and maliciously endanger life or cause serious injury to a person by going on strike. Furthermore, if an act of an employer is motivated primarily by health and safety concerns, not for the sole or main purpose of preventing or deterring the employee from taking protected industrial action or penalising them, they have a defence from detriment claims, and the tribunals will consider whether the employer’s act or failure to act constitutes detriment.
Amendments 251D and 252 seek to prejudge a full and open consultation on this issue by setting out circumstances in which the detriment protection will not apply. We will prescribe detriments in secondary legislation only once we have conducted a comprehensive consultation seeking views across the public, including those of workers, employers, trade unions and all other stakeholders.
With reference to Amendment 252, that protection from prescribed detriment applies only where the sole or main purpose of subjecting the worker to detriment is to prevent, deter or penalise the worker from taking protected industrial action; for example, if a worker is subjected to detriment solely or mainly because they have harassed or bullied non-striking workers, the protection will not apply. I can be clear that criminal law will continue to apply to pickets.
Amendment 251E would be an unnecessary limitation on the protections from detriment. The prohibitions that new Section 236A places on an employer are clear: the sole or main purpose of the action must be to deter or penalise industrial action, which would not apply in the case of genuine maintenance of critical operations. Amendment 251G would be an unreasonable restriction to apply to detriment protections. Non-union members have the right to participate in official protected industrial action and, where that is the case, must be afforded the same protections from detriment as union members.
Amendments 251L and 251N would place a burden on individuals to prove that they had suffered financial or economic loss as a result of detriment, and would limit the circumstances where they were eligible for compensation. These hurdles and limits would potentially deter them from engaging in industrial action, limiting compliance with the Supreme Court ruling and Article 11.
Amendments 251M and 251P seek to restrict compensation with regard to business deeds. I want to be clear that an employer’s action or failure to act in relation to prescribed detriments will be a legal obligation that cannot be breached proportionately, and there is no legitimate business interest defence for seeking to deter or penalise an employee for taking protected industrial action.
Amendment 251K seeks to establish bands of detriment severity of “minor”, “serious” and “extreme”, and would require the Secretary of State to specify maximum compensation limits for each, which tribunals would have to comply with. New Section 236D is already clear that employment tribunals must have regard to any loss sustained by a claimant that is attributable to the actions of, or failures to take action by, an employer. Therefore, tribunals will award compensation based on what the tribunal considers to be just and equitable and will be able to proportionately determine the amount of compensation, taking into account all the relevant circumstances. I hope I have reassured the noble Lord. I therefore ask him to withdraw Amendment 251C.
I am very grateful to the Minister for his very comprehensive answer, and also to the noble Baroness, Lady Kramer, for her comments. I will have to read Hansard very carefully, because there is quite a lot of detail in the Minister’s answer, but I will say that for months we have listened to Ministers speak at considerable length about the urgent need to address bad actors in our workplaces. On a number of occasions, they have painted fairly vivid pictures of unscrupulous employers who exploit workers, flout employment law and engage in practices that undermine good industrial relations. However, having been presented with clear evidence of equally concerning bad actors within the trade union movement, the Government’s response has been, in effect, to stay silent. I repeated those Unite comments, and I will repeat them again here, that
“the employer is routinely treated as a target to be defeated not a friend to be convinced”.
To use a word that came up in the last group, that is not “constructive” or collaborative; that is very hostile in intent.
Without going into enormous detail, Amendment 251L, for example, would require proof of actual financial loss, which is a basic principle that would prevent speculative claims. I do not see how that would deter anyone with a legitimate claim from engaging in industrial relations, so how would their Article 11 rights be infringed, as I believe the Minister outlined?
We will have to come back to these amendments because, as I say, there was a good deal of detail in there. Once again, the Minister is relying on the mythical consultation; I would like to know when that consultation on these aspects of these amendments will take place. Of course, that also calls into question when he expects all this to be implemented—a subject to which I am quite sure we will return on a number of occasions this evening. But for now, I beg leave to withdraw.
My Lords, I support the amendments tabled after Clause 75, which would require the Secretary of State to assess the impact of repealing the Strikes (Minimum Service Levels) Act 2023 in terms of emergency service provision and the broader resilience of our public infrastructure during industrial action. These are pragmatic and proportionate amendments, and I regret that they are even necessary, but the manner in which Clause 75 proposes to repeal this legislation—abruptly and with no review, consultation or supporting evidence—leaves us no choice.
The 2023 Act was narrowly drawn. It applied only to a tightly defined set of sectors—ambulance services, fire and rescue, health, transport, nuclear decommissioning and border security—in which a complete withdrawal of labour poses serious and obvious risks to life, safety, national security or national functioning. It did not ban strikes or criminalise union membership. It allowed a minimum service level to be set, by regulation, after consultation with affected sectors. In other words, it was a public protection measure, a mechanism of last resort, and it mirrored provisions already in countries across Europe and beyond.
The Government now seek to repeal the law, seemingly on the basis that it achieved nothing. They will no doubt point to the fact that industrial action has continued since the Act came into force. Indeed, we know from statistics that 160,000 working days were lost to strike action in the first quarter of 2025 alone. However, that statistic proves nothing about the value, or otherwise, of the Act. It proves only that the right to strike continues to be exercised, as it should be.
The Strikes (Minimum Service Levels) Act was never intended to eliminate strike action, and its success should not be judged by whether workers stopped striking. It should be judged by whether the public was kept safe when strikes did happen, whether ambulances still reached heart attack victims, basic fire cover was maintained and border infrastructure functioned at a minimum level.
That is a relevant test, and the Government have produced no evidence to show that those minimum protections were either unnecessary or ineffective. In fact, if the Act truly achieved nothing, why the rush to repeal it? Governments do not normally spend valuable legislative time repealing laws that they believe have no impact. The truth is that this law has teeth: it provides leverage, and it establishes a legal baseline. The Government want to remove it not because it is useless but because it places limits on how far certain interests can allow disruption to stretch.
Even if one believes the Act was flawed, the responsible course would be to review its effects before repealing it, particularly when the law was so recent and implementation across sectors was still under way. Consultations on minimum staffing levels had not been concluded in all sectors, practical guidelines had only begun to take shape and the real-world application of the law was still emerging, so to repeal it now is to abandon public protection in the name of political symbolism, to uproot a tree before it even had time to settle and declare it a failure for not bearing fruit.
What is most striking, however, is that the Government have provided no evidence that repealing the Act will lead to improved industrial relations, despite making that very claim in the impact assessment for this Bill. It is asserted almost in passing that the removal of the Act will restore trust or reduce tensions in negotiations, but where is the proof of that? Where is the analysis? Where is the independent data or stakeholder feedback to support that optimism?
We are told to take it on faith that repealing a legal framework designed to protect the public will somehow produce a more harmonious climate between unions and employers. But we are not here to govern by faith—we are here to scrutinise and to ask hard questions, and to legislate with due diligence. I put this to the Minister directly: can the Government point to any serious evidence, whether from unions, employers, emergency service leadership or international examples, that repealing this Act will improve negotiation outcomes, reduce disruption or lead to faster resolution of disputes? If not, why are we legislating in the dark?
What is the Government’s alternative? If we strip away the only existing mechanism for maintaining safe service levels during strikes, what replaces it? Nothing in the Bill offers an equivalent safeguard. There is no provision for voluntary cover agreements, no incentives for minimum staffing, no rapid arbitration scheme and no contingency powers for life and limb services. We must assume that the Government are content to simply let key public services fall to zero capacity during industrial disputes. There will be no legal recourse, no duty to plan and no obligation to protect the public. That is not reform.
Meanwhile, the public, who continue to support the right to strike in principle, also expect a functioning state. They expect to be able to call an ambulance and get one; they expect transport to limp along during industrial disputes, not collapse entirely; and they expect public safety to be preserved. The amendments before us are not extreme; they merely require a clear-sighted review of the implications of this repeal, something that any responsible Government would do as a matter of course.
I urge noble Lords to support these amendments. If the Government are confident that repealing the Act would strengthen industrial relations and carry no risk to public welfare, they should have no objection to reviewing that impact and reporting to Parliament. If they are not confident, I submit that the repeal should not proceed at all.
In short, the issue here is not ideology; it is competence. We are about to discard the only statutory mechanism for ensuring minimum service level provision during strikes—a model recognised across Europe and endorsed by ILO principles—without evidence, without a plan and without a single word of accountability to Parliament. As I said earlier, that is not governance; it is recklessness. I beg to move.
My Lords, I will speak to each of the three amendments in this group, starting with Amendment 254. A significant part of the reason for the minimum services, as my noble friend has just laid out, was to recognise that certain issues were affecting daily life.
It is worth while considering the timing of aspects of this, not long after the end of the Covid lockdowns, and recognising the economic challenges that our country faced. In combination with people’s need to access urgent medical support, bearing in mind that a number of activities had been cancelled many times already, the impact of seeing further strikes—cancelling a basic level of operation for patients—was starting to become potentially very difficult for the country to manage and for patients in getting better.
Other sectors were also discussed, and transport is a good example. I expect that none of the train operating companies used this, partly because many of them found different ways to keep trains running on a basic level—good examples of that would be Greater Anglia or South Western Railway. Greater Anglia will soon become a nationalised rail operator, so I would be very interested to know—I appreciate that the Minister may not have an answer today—what the practice will be in the future as a consequence of this. At the time, the operating company Abellio was able potentially to have gone to this piece of legislation to keep trains running, although it did not have to. Will nationalised rail companies be allowed to continue to keep services running so that users can get to work, or wherever they need to go, even though there are other people on strike? My expectation, candidly, is that no nationalised company will in any way go against any trade union strike. I cannot see a Labour Government Minister using that, so by repealing this legislation the Government will have lost a lever on behalf of many of the users of public services, or services put forward for public use, across the country.
At one point there was a discussion about schools. A similar issue had arisen with children during Covid, through no fault of their own and no fault of the teachers. Schools were kept open, by and large, physically for certain workers but also online. Undoubtedly, there was a challenge for education but also, frankly, the inconvenience to working parents when schools go on strike is particularly harmful and is disruptive to those families and the wider economy. But it was decided not to do that. We reverted back to making sure, in the spirit of the Act’s intentions, that we would keep it to what were deemed to be absolutely key public services. Otherwise, there would have been significant detriment to the wider public.
Amendment 258, tabled by the noble Lord, Lord Fox, and the noble Baroness, Lady Fox of Buckley, on a review into the impact on small businesses, would be very helpful. Huge changes are being put in place after nine years of a piece of legislation that from the economy’s perspective has worked reasonably well. I appreciate that the trade unions may not have liked it—and I recall it being voted against, back when this was being debated in the House a decade ago—but it is vital to the wider economy that we get our companies growing.
It seems to change every time, but I think that overall the number one mission of this Government is growth and the economy. Yet they are starting to do things, through this Bill and other situations, that seem to be driven by ideology rather than pragmatism and practicality. As a consequence, the basics and the consequences of some of this legislation, or the repealing of existing legislation, need to be considered in proper economic depth. I would love this to have happened with an updated impact assessment for us to consider before we conclude the Bill. By the way, I am grateful to the Minister for making sure that the letter the Secretary of State sent me has been placed in the Library so that every Peer can see it, but it worries me that that issue will not be considered further.
Amendment 256 links with the idea of a certification officer. I will come to series of amendments on that soon, so I am not sure how much of a certification officer role will be left. When it applies its thoughts on how it goes about the enforcement of the laws to which it is subject—and which it is also doing on behalf of trade union members—it should consider our role in the world and, in particular, how that contributes to make sure that we have a growing economy. I am sure all Members of your Lordships’ House would agree that we need it to grow.
My Lords, I am very grateful to the Minister for his response, and to my noble friends Lady Coffey, Lady Noakes and Lady Lawlor for their comments. I also thank the noble Baroness, Lady Kramer, for introducing the important amendment tabled by the noble Lord, Lord Fox, which I neglected to speak to but will do in a second, for which I apologise. Regarding the Minister’s assertion that the unions do not cause chaos, perhaps somebody should alert the RMT to that. By its own estimation, it cost the economy £5 billion in 2023. I would call that fairly chaotic.
As we conclude this debate, I express some disappointment at the Government’s response to the modest and reasonable amendments that we have tabled. We have simply asked for evidence. A number of the assertions that the Minister made are based on none whatever. We have asked for an impact assessment—we repeatedly ask for impact assessments on all manner of aspects of this Bill. I will take him up on his offer of that meeting. However, to come back to the implementation plan, it would be a much better-informed meeting if we had an implementation plan and a timeline. We will not drop this until the Minister can provide one. I am sure he will be working “at pace”, in his noble friend’s phraseology.
All we have done is ask for the Government to pause and consider the real-world consequences of repealing a law that was designed to protect public safety during times of industrial action. The Government claim, with some optimism, that removing the Strikes (Minimum Service Levels) Act 2023 will somehow improve industrial relations. However, when they were asked to produce any evidence from employers, unions, the public or independent experts, none was forthcoming. There is no analysis of outcomes, no tracking of safety impacts, no consultation findings and no plan for what replaces the protections that they are so eager to tear down. In short, there is no case, just conviction without content.
We could go on and talk about how this is not theoretical, and I would again point noble Lords to look at Birmingham. If the Government truly believe that the 2023 Act was flawed, they should prove the case with data, with stakeholder consultation and with a sober assessment of what ought to follow in its place, and not simply repeal it blindly, prematurely and with no credible alternative offered. We are not asking for the impossible. Our amendments ask for a review, a report and a basic assessment of impact. They are measured, responsible and in keeping with the House’s role in ensuring good governance.
I have two more points. I should have acknowledged and expressed very strong support for Amendment 258 in the name of the noble Lord, Lord Fox. That rightly seeks a review into the impact of Part 4 of the Bill on small and medium-sized enterprises, and I look forward to picking that subject up with him again when he is back.
I note that my noble friend Lady Coffey asked a very specific question about the nationalised rail industry. I am sure we would all like an answer, so perhaps the noble Lord will write with the Government’s intentions when it comes to governing that particular sector. For now, I beg leave to withdraw my amendment.
My Lords, as my noble friend Lady Coffey mentioned a short while ago, we have been told by this Government on numerous occasions that growth is their number one priority. Growth, growth and more growth has become something of a mantra for Ministers, but the harsh reality is that their actions are consistently undermining this stated objective, and their latest economic performance demonstrates the urgent need for the amendment before us today.
The UK economy shrank more than expected in April. The standard measure of economic output, GDP, contracted a sharp 0.3% according to data from the Office for National Statistics. Additional costs on businesses were also levied during that month as employer national insurance contributions took effect, which businesses told the ONS played a part in their performance. The biggest part of the economy, the services sector, contracted by 0.4% and manufacturing dropped by 0.9%. The Government are manifestly failing to reach their stated growth target.
It is not enough for the Government to tell workers, businesses and the British public what they want to hear about growth while simultaneously implementing policies that actively undermine economic competitiveness. The trade union provisions in the Bill represent a perfect example of this contradiction: they expand the protections and rights that will inevitably increase costs, reduce flexibility and diminish our international competitiveness, all while the Government claim to be prioritising growth.
My amendment would require the Certification Officer, when discharging functions under the Bill’s expanded trade union framework, to advance the objectives of international competitiveness and medium to long-term economic growth. It represents a vital safeguard against the economic damage that unconstrained implementation of these provisions could inflict. The Certification Officer oversees trade union administration from registration to financial transparency to complaint procedures. Under the Bill, these functions will expand significantly as new rights and protections are introduced. Without a growth duty, there is no mechanism to ensure that the Certification Officer considers the broader economic implications of how these expanded powers are exercised.
We operate in an intensely competitive global economy. Our European neighbours and international competitors are not standing still while we load additional costs and restrictions on to British businesses. When the Certification Officer makes decisions about trade union regulation, registration and oversight, those decisions must be made with full awareness of their impact on our ability to compete internationally. Countries such as Germany, despite having strong trade union traditions, maintain regulatory frameworks that prioritise economic competitiveness. Singapore, Ireland and other successful economies have demonstrated that worker protection and economic growth are not mutually exclusive, except when regulators are required to balance these objectives explicitly.
This amendment ensures that as we expand trade union rights and protections, we do so in in a way that enhances rather than undermines our economic position. It requires the Certification Officer to ask not just whether a decision serves trade union interests but whether it serves the broader national interest in maintaining a competitive and growing economy.
The concept of growth duties is well established across government precisely because regulators have learned that narrow focus on single objectives can create unintended economic consequences. Financial regulators have competitiveness objectives because financial regulation that ignores competitiveness can drive business overseas. Planning authorities must consider economic impact because planning decisions that ignore economic consequences can destroy local economies. Environmental regulators operate within frameworks that balance protection with economic considerations because environmental regulation that ignores economic reality becomes counterproductive.
The offshore employment trend demonstrates exactly why such balanced approaches are essential. When regulators focus solely on enhancing protections without considering economic consequences, they risk creating conditions where the protections become meaningless because the activity they are meant to regulate simply moves beyond their jurisdiction. It would be extraordinary if trade union regulation, which directly affects workplace costs, flexibility and productivity, were exempt from such considerations. This amendment brings the Certification Officer into line with best practice across government by requiring explicit consideration of economic impact.
The Government may argue that trade union regulation should focus solely on worker protection without economic considerations, but this position is fundamentally flawed for a number of reasons, and recent evidence makes it increasingly untenable. For example, it would create an artificial separation between industrial relations and economic policy that exists nowhere else in government and has proven counterproductive in practice. Every other area of regulation requires consideration of economic impact precisely because regulators have learned that ignoring economic consequences undermines policy objectives. It would also contradict the Government’s stated priority of growth while simultaneously demonstrating the practical impossibility of separating worker protection from economic performance.
When companies such as The Legends Agency can build multi-million-pound businesses by helping UK employers avoid UK employment law, the Government’s approach has clearly failed on its own terms. I beg to move.
My Lords, I am a great fan of international competitiveness and growth objectives for regulators. When the first one was introduced for financial services regulators in the Financial Services and Markets Act 2023, I thought it was an incredibly important addition to the way regulation of financial services is undertaken. Just last week, your Lordships’ Financial Services Regulation Committee issued its report on how that international competitiveness and growth objective is working, and I commend it to noble Lords.
I support what my noble friend Lord Sharpe of Epsom has said about applying the duty to the Certification Officer, but I invite him to consider whether there is a much more important area where such a duty should be applied in this Bill, which is to when the Secretary of State makes decisions about, for example, the enforcement provisions or making the various regulations that we know are necessary to make Part 1, and indeed other parts of the Bill, operate effectively.
The most important aspect of the Bill is going to be driven by what the Secretary of State does once it is enacted, but there is not an equivalent requirement on the Secretary of State to take into account the needs of international competitiveness and growth. It is essential for the Secretary of State to have that at the front of his mind when making regulations that will have such a big impact on the way that businesses operate in this country. I therefore commend my noble friend’s amendment, but if he is considering bringing something back on Report, he might consider something a little broader.
My Lords, I thank the noble Lord, Lord Sharpe, for tabling Amendment 256. We fully recognise the importance of supporting growth and international competitiveness across our economy, and we will of course continue to pursue policies that will deliver on our economic ambition. However, we do not consider this duty to be appropriate for the certification officer.
The certification officer is not a traditional regulator; they are an independent quasi-judicial officeholder. Their core functions are to oversee regulatory compliance fairly and impartially and to ensure trade unions and employers’ associations adhere to statutory requirements in relation to their finances and governance. This includes investigating complaints, maintaining accurate registers and ensuring that democratic processes are upheld. Imposing a duty to promote growth and competitiveness would cut across this role. It risks introducing competing priorities, blurring legal clarity and ultimately undermining confidence in the CO’s neutrality. We cannot require the certification officer both to conduct their judicial and regulatory functions and to deliver economic outcomes. The certification officer has no role in relation to the international competitiveness of the United Kingdom economy or its growth in the medium to long term.
As noble Lords will know, this Government have been active in requiring a number of regulators to apply a growth duty. Those bodies to which the growth duty currently applies are purely regulators—regulators that set strategies and make decisions that significantly affect the type, scale and location of economic activity in important sectors. The decisions regulators take can set the parameters for economic activity across the economy, and, of course, we recognise that; but the certification officer does not have this responsibility or power. We share the noble Lord’s commitment to economic growth, but it must be pursued in the right way. Furthermore, requiring the certification officer to follow a growth duty would not be practicable, and there is no evidence that imposing such a duty would have any meaningful impact on the UK’s growth or international competitiveness. It would be like asking a court to consider cases based on their impact on economic growth rather than on the evidence of the case.
For those reasons, I must ask the noble Lord, Lord Sharpe of Epsom, to withdraw Amendment 256.
My Lords, I thank the Minister for her answer, but I have to say that I am unpersuaded. The gist of it was that the certification officer does not have either the responsibility or the power, but by definition this amendment would deliver both those things. I completely agree with my noble friend Lady Noakes, and I shall take her suggestions on board and have a careful look at this. I do not believe that this amendment and the suggestions she made are mutually exclusive; in fact, if anything, they are very complementary. I thank my noble friend Lord Fuller for his comments, which, frankly, were just an expression of complete common sense.
I express my disappointment at the Government’s rejecting this amendment. I think it reveals more about the Government’s true priorities, frankly, than all the rhetoric about growth that we have heard. The Government are absolutely right to identify growth as a priority, but they will not find it in this Bill. In fact, there is nothing in the Bill that will bring any growth. I challenge the Minister to identify a single provision in these hundreds of pages that will increase productivity, enhance competitiveness or create jobs. The Government’s own impact assessment suggests the same: it is a document notably silent on growth benefits, while cataloguing increasing costs and regulatory burdens.
If the Minister is genuinely confident that the Bill will support growth, and if she truly believes that the expanded trade union protections and enhanced worker rights will somehow boost economic performance, I am surprised and somewhat mystified that she will not accept this amendment. The argument was that the certification officer is not a traditional regulator, but they still have a regulatory function, so I do not really see what difference that makes, frankly. What could be the objection to requiring the certification officer to consider growth when discharging functions under a Bill the Government claim supports growth? If these provisions truly advance economic competitiveness, a growth duty should be welcomed as a validation of the Government’s approach.
I could go on, but I do not see the point. The Government have rejected a genuine opportunity to demonstrate that their growth rhetoric has substance. The amendment would have required no fundamental changes to their approach, simply consideration of the economic impact when implementing trade union provisions. It would have aligned trade union regulation with best practice across government, while preserving all the work protections the Government claim to champion. The fact that they cannot even accept a modest requirement demonstrates that the commitment to growth is hollow rhetoric. It is designed to disguise an agenda focused more on trade union empowerment, regardless of economic consequences. How very disappointing for our great nation. I beg leave to withdraw the amendment.
My Lords, I have tabled Amendment 257B simply because I did not see the answer in the Explanatory Notes to the Bill. This is quite a straightforward one for the Minister.
In Section 293 of the Trade Union and Labour Relations (Consolidation) Act 1992, the regulations are normally done by negative resolution—or the annulment, as set out in new subsection (6). However, I want to understand why the Government felt that these particular regulations needed to be done through the affirmative procedure. They are not the only changes—that I am aware of—in the Bill to that section, or others, of the Act. Can the Minister explain why they have been singled out? Given the trend of your Lordships’ House over many years, why do we not move to having affirmative resolutions instead of annulments for these ones in the future? I beg to move.
My Lords, I thank my noble friend Lady Coffey for her amendments; they are measured, necessary and principled amendments to Clause 85, which rightly restore a degree of parliamentary scrutiny that had been quietly eroded in the original draft of the Bill. As we stated at Second Reading, there are 173 delegated powers in the Bill, which is unacceptable—not just to those the legislation will impact, but to the House.
In the Minister’s contributions on similar legislation in the past, she expressed her strong reservations about the use of delegated powers. I recall well her interventions, which were made with clarity and conviction, as she tabled amendments recommended by the Delegated Powers and Regulatory Reform Committee. But we now find ourselves considering a clause that does precisely what she once warned against because it carves out certain sensitive and constitutionally significant areas and exposes them only to selective scrutiny.
The original version of Clause 85 created a two-tier system. Some regulations would require affirmative approval from this House, while others—no less consequential—would not. This piecemeal approach to oversight is not only undesirable but unnecessary. Regulations made under Section 293 of the Trade Union and Labour Relations (Consolidation) Act are not merely technical: they pertain to fundamental matters, such as the rights of trade unions, the balance of power between employers and employees, and the protections afforded to those who take lawful industrial action. It is therefore only right and proper that all regulations made under this section should be subject to the affirmative resolution procedure: they should be laid before and approved by both Houses of Parliament.
My noble friend’s amendment achieves this. It does so with economy of language, but with significant constitutional consequence. It removes the artificial distinction introduced by subsection (5), and instead applies a uniform standard of scrutiny to the entirety of Section 293.
Since the Government took office, many of us across these Benches have expressed concern about the growing use of skeleton Bills, Henry VIII clauses and broad enabling powers that allow Ministers to legislate without adequate consultation or scrutiny. This amendment is a quiet but firm step in the other direction back towards balance, principle and the proper functioning of Parliament.
Again, I thank my noble friend for tabling her amendment, and I hope the Government will not merely accept it but embrace it to show their commitment to transparency and to the constitutional propriety of this House.
My Lords, I thank the noble Lord, Lord Sharpe, for his contribution. I remember standing before him during the PRaM Bill and we discussed this very matter. Some of this negative resolution is required because not only does it save parliamentary time but it is technical. Anyway, I thank the noble Baroness, Lady Coffey, for tabling Amendments 257B and 257C, which would make all the powers under Clause 56 subject to the affirmative procedure, as well as existing regulation-making powers that are currently covered by the negative procedure, by virtue of current Section 293 of the Trade Union and Labour Relations (Consolidation) Act 1992.
It is worth noting that most of the access regulations are already subject to the affirmative procedure. Indeed, as the noble Lord, Lord Sharpe, mentioned, only four of the 12 delegated powers are subject to the negative procedure. Given the technical nature of those delegated powers, and to save parliamentary time, the Government are of the position that making them subject to the affirmative procedure would not be appropriate.
Further to this, as mentioned in previous debates, all regulations under Clause 57 will be consulted on via public consultation, the outcome of which will be published for all to see. This is an important process, which will help ensure that our policy development is informed by the practical experience and needs of trade unions, businesses and stakeholders.
The noble Baroness, Lady Coffey, and the noble Lord, Lord Sharpe, will have noted in previous debates in this place that the Delegated Powers and Regulatory Reform Committee said that
“it is heartening that in a Bill with so many delegated powers”—
the noble Lord, Lord Sharpe, mentioned 173—it had
“only found four on which to raise concerns”.
Clause 56 was not one of those. Therefore, I ask that the noble Baroness, Lady Coffey, to withdraw Amendment 257B.
My Lords, I address Amendment 287 on the creation of an office for a freelance commissioner in the name of my noble friends Lord Clancarty, Lord Freyberg and Lord Colville of Culross, who has managed to beat our limited motorway system but arrived just too late to speak, sadly.
I am somewhat conflicted about this thought-provoking amendment, in that I have argued at Second Reading and in Committee against the overreach of the Bill and its sheer complexity and burden on employers, especially for small and micro businesses. On the noble Baroness’s comment, I do not want to be seen to be adding baubles to the Christmas tree. However, I agree that year by year the arguments grow for the establishment of a freelance commissioner, partly because the number of freelancers is growing and will continue to do so. The current 2 million plus freelancers will easily rise to 3 million within the next 10 years in the UK alone as employers shed staff from payroll, weighed down by the combination of increased national insurance contributions, national minimum wages increasing much faster than the rate of inflation and all the new rules and regulations coming in this very Employment Rights Bill.
Just look at the recent and alarming drop reported last week by the ONS of 274,000 workers coming off payroll during the past 12 months. We do not yet have the data to track how many of them are transitioning to freelance or self-employment. Indeed, as my noble friends have pointed out, the data on this area of freelancing and self-employment is poor and not up to international standards, and that is a real problem when we are trying to assess exactly what their contribution is to the economy.
I am going to muddy the water slightly, but you could argue that there is a need for an independent commissioner for the self-employed. We have been talking about freelancers, but there are 4.2 million self-employed people, including freelancers, in the UK. Those numbers are going to increase given the impact of technology, digital communications, AI and, particularly, the practice of working from home. I accept that there are key differences between freelancers and many self-employed people, for example, sole traders or those running their own businesses or partnerships, perhaps with just one or two contractors, but freelancers, although independent and project-based, are also self-employed and are treated just the same way for tax purposes by HMRC.
I accept that freelancers and the self-employed are not as valued or appreciated by Governments of all parties as they should be. This was brutally exposed during the pandemic with furlough and other schemes. If we want to develop a proper entrepreneurial spirit and environment in this country, we should do much more to value and look after those who create their own jobs and face up to all the risks and jeopardy that that involves. That includes freelancers, not just in the creative industries, but in other sectors where they are prevalent, which are as diverse as construction, professional services and agriculture. The Government need to give Amendment 287 serious consideration and, while doing so, think through how the interests of all the self-employed, not just freelancers, should be represented.
My Lords, I thank the noble Lords, Lord Freyberg, Lord Clancarty and, particularly, Lord Clement-Jones, for their valuable contributions and amendments in this group and for the thoughtful way they have introduced them. I am very grateful for their tireless advocacy on behalf of the freelance workforce, who so often find themselves on the margins of employment policy. I will speak in particular to Amendments 301 and 302, tabled the noble Lord, Lord Clement-Jones, which I was happy to sign.
Amendment 301 introduces a new clause which, for the first time in statute, provides a clear and much-needed definition of a freelancer. This definition acknowledges the reality of modern working life, where individuals are often engaged on short-term contracts, operating through their own companies or via intermediaries and managing their own tax and national insurance affairs. These individuals, who are distinct from employees or workers as defined under current legislation, are nonetheless a vital and growing component of our labour market, as the noble Lord, Lord Londesborough, has just pointed out. The amendment does not seek to blur the lines between employment statuses, but rather to draw a necessary and clarifying distinction that enables policy and legislation to recognise freelancers in their own right. The inclusion of the provision for the Secretary of State to issue guidance ensures that the definition can evolve with working practices and case law, and that is both sensible and future-proofed.
Amendment 302 builds on this by creating a duty—a statutory obligation—for relevant government departments to have due regard to the freelancer workforce when shaping new policy. Too often freelancers are treated as an afterthought, and they fall between the cracks of legislation designed for binary employment categories. This amendment seeks to correct that omission. It ensures that the realities of freelance working are considered proactively in policy design, not reactively after the damage has been done.
Furthermore, the amendment ensures that the freelance commissioner, a role established to advocate for and advise on matters affecting freelancers, is appropriately consulted in the policy-making process. That is a modest yet essential safeguard to ensure that expertise is brought to bear when policies may significantly affect freelance professionals, particularly in sectors such as the creative industries, technology and media, where freelancing is not the exception but the norm.
These are thoughtful and proportionate amendments. They do not create undue bureaucracy, nor do they entrench rigid definitions. They offer clarity, fairness, and recognition to a workforce that contributes enormously to our economy and cultural life, yet is often unprotected and unheard in legislative terms. These proposals are not about privileging one form of work over another. They are about ensuring that our legal and regulatory frameworks reflect the diversity of modern work. I commend the noble Lord, Lord Clement-Jones, and his cosignatories on bringing these matters before the Committee, and I urge the Government to give serious consideration to these amendments as practical and principled improvements to the Bill.
I will take this opportunity to speak more broadly regarding the wider group of amendments concerning the impact of this legislation on freelancers and the cultural and creative sectors. Amendment 285 proposes a temporary waiver for small and independent cultural organisations in financial hardship. This is a pragmatic and compassionate measure. We all support robust employment protections, but a one-size-fits-all rollout risks devastating unintended consequences: closures, lay-offs or the collapse of small institutions that are already on the financial brink. The idea of a grace period and progressive enforcement is a proportionate way of balancing worker protections with organisational survival.
My Lords, my Amendment 262 concerns an issue of considerable importance, not merely for those involved directly in industrial relations but for the health of our broader economy, the stability of our public services and the legitimacy of this legislation. The amendment would require the Government to commission and publish, within 12 months of Royal Assent, an independent assessment of the impact of this Act on the number of working days lost to strike action, specifically comparing the 12 months following its enactment with the 12 months preceding it. That report would then have to be laid before Parliament. This amendment is modest in scope. It does not seek to obstruct the Bill or alter its provisions. It merely seeks transparency, accountability and, above all, vital evidence-based analysis in due course.
There is a striking—if I may use that word without inflaming the debate—absence of hard data or persuasive analysis in support of the central justification for these changes, namely that repealing certain elements of the Trade Union Act 2016 will result in better industrial relations. Indeed, the Government’s own impact assessment acknowledges that there could be a benefit
“if Trade Union reforms lead to better industrial relations”.
I emphasise “if”. Hope is not a good substitute for policy. Nor should legislation of this consequence be built on assumptions rather than analysis. I will therefore structure my remarks around three core questions which the Government have failed to answer convincingly and which this amendment would help to address.
If we are to repeal elements of the 2016 Act, we must first understand what standard the Government are using to declare that Act a failure, or at the very least to assert that it is no longer fit for purpose. The Trade Union Act 2016 introduced significant changes: minimum turnout thresholds for strike ballots; requirements for information on ballot papers; limits on picketing; and restrictions on facility time in the public sector. It was controversial, certainly, but it was also justified by the Government of the time as necessary to ensure that industrial action had a strong democratic legitimacy, and that the wider public were protected from excessive disruption.
Now we are told that these measures must be rolled back, but we have at no stage been told what objective, or even subjective, measure of success or failure is being applied. Are we to believe that the 2016 Act failed because it did not eliminate all industrial action, because it was unpopular with some stakeholders or because it placed an administrative burden on unions—or, more worryingly, is it being repealed simply as a matter of political preference? To look at some figures, according to the Office for National Statistics, the number of working days lost to strike action was at a historic low throughout the period following the 2016 Act until a sharp rise in 2022-23, partly driven by inflation, the consequential erosion of real-terms pay and broader discontent in the traditional public sector.
Are we being told the legislation was ineffective because strikes still happened in 2022? If so, that ignores the very different macroeconomic context we now face. Or is the claim simply that industrial relations will somehow improve if these legal constraints are lifted? In any of those cases we must ask: compared with what? Compared with the pre-2016 environment? Compared with our European neighbours? Or compared with a model of workplace consensus that may not exist in reality? Without a baseline for comparison, the Government’s argument is essentially unfalsifiable and unjustifiable.
Let us assume for the sake of argument that the Government believe that these changes will lead to more equitable bargaining, greater union engagement and ultimately improved relations between employers and workers. Even if that were true, we must still ask at what cost. If these reforms lead to a rise in industrial action, that will have implications not only for the affected sectors but for the public at large. Trains will be cancelled, schools will be closed, hospital appointments will be postponed, bin collections will be missed and courts will be adjourned. These are not abstract costs, so it is extraordinary to repeal a major piece of industrial relations legislation without offering any quantification of the risks of increased disruption and without explaining how those risks will be mitigated.
The impact assessment leans heavily on the idea that increased union involvement could lead to improved communication and better outcomes, and perhaps it could. But the fact remains that the cost of getting this wrong will be borne not by policymakers but by the public. That is why this amendment is so crucial. It simply asks the Government to return to Parliament within a year and tell us whether this has worked. Has industrial action decreased or increased? Are we seeing the promised harmony or the feared escalation? If it is the latter, we as legislators have a responsibility to know that and to act accordingly.
Perhaps the most fundamental question of all is: what actual, empirical, verifiable evidence do the Government have to support their central claim? We have not been given a retrospective analysis of the Trade Union Act 2016 and its impact. We have not been provided with consultation data that robustly supports repeal. We have not seen sector-by-sector breakdowns of how these measures will improve the industrial landscape. We have not even seen clear articulation of the problem the Bill is trying to solve. Indeed, the rationale appears to be more ideological than evidential. It seems to be based on the belief that loosening legal constraints will somehow foster good will and reduce conflict. All the academic research and literature on industrial relations remind us that legal frameworks matter, that institutions shape behaviour, and that rules, when clear, consistent and fairly applied, help prevent conflict and not exacerbate it.
If the Government are so confident in their position, why not test it? Why not commit to measuring its effect? Why not, a year on, lay before this House and the other place an honest assessment of whether their theory of change has delivered the desired result? If the evidence proves them right, they will be vindicated. If not, Parliament should be empowered to revisit the legislation. There is, after all, considerable flexibility inherent in legislation so riddled with Henry VIII powers. I look forward to the Minister’s reply and I beg to move.
My Lords, I rise to support Amendment 262 in the name of the noble Lord, Lord Sharpe, and others, because I want to talk about a simple economic truth. One of the provisions in the Bill will reduce the thresholds at which industrial action may be called or authorised. The truth is that when you reduce the threshold, the likelihood of industrial action does not grow linearly; it grows exponentially. The amendment is needed because the Bill, sadly, will provide the world with a real-life experiment that will inform political and economic science of that simple truth.
It could be worse than that. My experience comes from local government and my relationship with the National Joint Council. Local government employs 1.8 million local government workers. There are three principal unions: Unite, UNISON and GMB. Within the cohort of local government workers, I have negotiated with the craft workers, the Salisbury workers and the coroners. There is a red book, a green book and a blue book; there is even a gold book covering senior fire officers and police officers. There are 136 different activities that local authorities do and, of course, there are 350 principal councils. I have engaged with all this complexity over about 10 years sitting on the National Joint Council, the device through which the employers engage with the unions. I have sat alongside the noble Baroness, Lady Taylor, on that body for many years, and now we both find ourselves in here.
As part of the gang of four, the top four local government councillors engaged in these important negotiations, I have learned a lot of things. There is less beer, there are fewer sandwiches and there are palatial premises built by one of the unions in Euston. It has not been easy work, but we have had a series of national agreements engaging on a respectful basis. It has been valuable work. The important point is that there have been powerful incentives to avoid industrial action. The bar has not been impossible, but it has been a high bar against which strike action must be called. It has sort of worked, because there has been an equilibrium between the employer and the employees across 1.8 million unionised workers —just under a third of them all—in this country.
That equilibrium has meant that when there is a strike, it is serious. When people down tools, it is in the news. The Birmingham bin strike is a case in point: there is a strike, and it is serious. My anxiety about so many of the provisions in the Bill is that it is going to dissolve the powerful incentives to avoid industrial action and instead, arithmetically and structurally, put in the provisions where it is encouraged. The Bill sets the wrong balance, because we are not talking about simple organisations with single unions and small workforces in local government. We are talking about a very complex landscape. If you reduce the thresholds, people are more likely to strike because a minority, as little as 10%, of workers could call a strike. When 10% hold the 90% over a barrel, that is clearly not in the interests of the public; it is not in the interests of the workers; and I do not believe that in the long term it is in the interests of the unions.
Amendment 262 calls for a robust assessment of the effect of the Bill on days lost to industrial action. Not only is that the right thing to do but we would do a service, because it would demonstrate once and for all that simple efficiency of labour relations: if you reduce the threshold to call industrial action, the number of days lost to strikes will go up geometrically. I regret that we are going to do a service to political and economic science, but if that is the way it is, Amendment 262 is the way to achieve it.
My Lords, I thank the noble Lord, Lord Fuller, and the noble Baroness, Lady Lawlor, for their contributions. I will be brief; I do not want to stand between noble Lords and their dinner break.
I thank the noble Lord, Lord Sharpe of Epsom, for his Amendment 262. We have already debated impact assessments at great length and I will not repeat the same arguments. Any industrial action is regrettable and all parties have a duty to seek a resolution to such disputes. Failure to do so is basically a lack of management and leadership by all. We have also debated the repeal of the 2016 Act in previous debates. I will not mention that either. Furthermore, it is a manifesto commitment.
Despite its good intentions, the amendment would impose a review procedure that in effect repeats what the Government already intend to do. We recognise the importance of ensuring that the impacts of these policies on workers, business and the economy are considered, and that analysis assessing these impacts is published. Our impact assessment also outlines a plan for monitoring and evaluating the impact of the Bill and subsequent secondary legislation.
As noble Lords will see from the impact assessment, our Employment Rights Bill could have a positive direct impact on economic growth, helping to support the Government’s mission for growth and ensuring that we raise living standards across the country and create opportunities for all. The Bill is expected to benefit people in some of the most deprived areas of the country by saving them up to £600 in lost income from the hidden costs of insecure work.
To conclude, I reassure your Lordships that we already have robust plans in place to assess and review the Bill’s impacts, including on industrial action. My commitment in an earlier debate to meet noble Lords to discuss the impact assessment further still stands. I therefore ask the noble Lord, Lord Sharpe of Epsom, to withdraw Amendment 262.
My Lords, I thank the noble Lord, Lord Leong, for his answer, but I am, of course, disappointed. I must say to him that of course he could not repeat the argument about the impact assessment because it is manifestly inadequate and overreliant on the word “could”, which he just used again.
So it is with a sense of frustration that I close this debate on Amendment 262 because, let us be blunt, the Regulatory Policy Committee has already deemed the Government’s own analysis inadequate. It found that the assessment underpinning this Bill failed to consider important variables, lacked robust modelling of strike-related costs and omitted any real evaluation of how the repeal of the 2016 Act provisions might drive up the number of working days lost to industrial action. That is criticism born not of political bias but of technical expert judgment, but the Government persist in asserting that an independent stocktake of actual strike days would be superfluous.
During the Bill’s passage, no fewer than 160 government amendments were tabled on Report, some of the most consequential of which would fundamentally alter the trade union landscape: changes to ballot thresholds, as my noble friend Lord Fuller explained; adjustments to picketing rules; and alterations to facility time arrangements. Many came late, with scant time for meaningful consultation and no accompanying update to the impact assessment. In effect, we are being asked to sign off on a statute the final shape of which was revealed only in piecemeal fashion and for which no comprehensive evaluation has ever been produced. There is more flesh on the skeleton now, but it still makes for a pretty unsavoury sight.
The consequences of this are already evident. Businesses stand in limbo. They are unsure how to prepare—again, the lack of an implementation plan. HR directors, legal advisers and finance teams are all left guessing which rules will apply. If the Government can point to a single one who is not, could they please say so, because we have spoken to very many and cannot find a single one who is not left guessing? They require clarity, not uncertainty. They need to know, for instance, whether a union ballot will again require a 50% turnout, or whether the conduct of pickets will be governed by new or old prescriptions. In their absence, investment decisions are deferred, retention and, especially, recruitment strategies are on hold and the workforce, unsure of its rights and obligations, faces unnecessary anxiety.
To deny acceptance of this amendment is to deny the very notion that policy should be tested against outcomes and treats legislation as unchallengeable, rather than a living instrument whose impacts must be monitored, and it tells employers, workers and the public alike that we legislate in the dark. So I regret deeply that the Government have chosen to reject the amendment. Doing so signals a reluctance to subject themselves to the discipline of evidence, shirks the responsibility to measure the real-world consequences of their own handiwork, and turns a blind eye to the limbo in which businesses and the public languish. That is not acceptable. If the Government’s reforms truly will deliver better industrial relations, they should welcome the chance to prove it. If Ministers are as confident as they claim to be, let them fast-track the assessment. Let them demonstrate that strike days are falling, that workplaces are more harmonious and that public services are protected. For now, I beg leave to withdraw the amendment.