Enterprise and Regulatory Reform Bill
Debate between Lord Young of Norwood Green and Lord Marland
Lord Young of Norwood Green
Amendment 20M would remove the requirement that a financial penalty be set at 50% of the amount of any compensation awarded. We support the provision to levy an additional fine on employers where they have been found to have breached an employee’s rights and there are so-called aggravating features. We hope that this will act as a further deterrent to rogue employers. However, when considered in the context of the main thrust of the Government’s changes to the employment rights landscape, such as the increase in the unfair dismissal threshold to two years and the extension of new settlement agreements, all of which will make it easier for employers to get rid of workers without following proper process, I am not optimistic about the difference this will make. We have some questions over the practical detail of this provision—for instance, what will be considered an aggravating feature, and the impact that it might have on speed of payment of compensation? However, we will discuss those issues in later amendments.
This is a simple probing amendment to understand further the Government’s thinking behind setting the level of fine at 50% of any compensation awarded. We are not strictly opposed to this being the level set but it seems overly prescriptive in that, earlier in the clause, the Government have already set out the parameters for the amount that an employer may be fined under this proposed new section.
We understand that it is important that employers have certainty about the level of fine that they might face if a claim is upheld. However, we would have thought that setting the minimum and maximum levels of penalty at £100 and £5,000 was a more than sufficient guide to employers about what they might face. What is more, if the Government are still anxious about clarity we would have thought that their first priority would be to produce guidance on what will be considered an aggravating feature. I beg to move.
Lord Marland
My Lords, this is an amendment that my noble friend Lady Brinton was also alluding to. It is a very reasonable probing amendment. What we are building on here is the Labour Government’s legislation, which we supported. I am grateful that the noble Lord, Lord Young, has indicated that he is broadly supportive of the direction of travel. We are trying to have here an award of 50% of value rather than an arbitrary figure of between £100 and £5,000—£100 being the floor and £5,000 being the ceiling. There is therefore a consistency of approach, as you would get an award of 50%.
I would like to move on to the question that I said I would answer from my noble friend Lady Brinton. In the case of multiple cases against the same employer, this clause provides for the tribunal to impose a penalty of varying amounts up to a maximum of 50% for each employee, unlike single claims where the penalty must be 50% of the value of the award. I notice that my noble friend is nodding so it is not as clear as mud but absolutely crystal clear to her, which is of great benefit to me because she has greater experience of this than I. It is perfectly reasonable and fair that we should have a 50% award and that we do not have arbitrary figures. I know that the noble Lord, Lord Young, believes that that is fair. On that basis, having clarified our position, I hope that the noble Lord is able to withdraw his amendment.
Lord Young of Norwood Green
I asked what would be considered an aggravating feature and about the impact it might have on the speed of payment of compensation, but the Minister did not return to the point.
Lord Marland
That is a perfectly reasonable question, and I know that the noble Lord is asking me a question to which he knows the answer—as he often does, because he knows a lot about these things. We cannot be prescriptive about aggravating speeches—sorry, I meant aggravating features. We do not intend to supply that but we have a list of examples which is in the Explanatory Memorandum. I feel sure that things such as deliberate or malicious acts, et cetera, would satisfy the question to which the noble Lord knew the answer before he asked me.
Lord Young of Norwood Green
Such cynicism so early in the day. All I can say is that we will take into account the Minister’s response. I am not saying that we are fully satisfied with it—we may return to the issue on Report—but, for the moment, I beg leave to withdraw.
Lord Marland
First, I would like to make a couple of points on training, which is of great interest to the noble Lord, Lord Young of Norwood Green. We all agree that training is absolutely fundamental and his knowledge, expertise and commitment to it are very high. This Government have spent a huge amount of money on training, on mentoring and on various other things. We must be getting something right because a million new jobs have been taken on board in the past two years in the private sector. We do not have a load of people running away from employment. It demonstrates clearly that, with unemployment going down and employment in the private sector going up, the policies that we have created to foster employment are working and seem to be working satisfactorily. I do not think that this is a block to training or ongoing employment. The noble Lord would have been right to point it out had this Government not been keen that we should do it.
Let us be fair. All of us are keen that employers should meet their obligations to their employees. That is what we are all here for. None of us is here saying that we want to withdraw this and that. We are arguing around the margins. Throughout this, as I have also argued, ultimately it is up to the tribunal. As we have said, and as the noble Baroness, Lady Turner, has rightly said, a tribunal is the last place where we want things to go to. We want them to have gone to ACAS beforehand, as we have previously agreed, and we want the employer and the employee to have sorted it out by themselves. I am compelled by the point made by the noble Baroness.
Ultimately it is the tribunal that will be making the decision if it gets to that point. We hope that it does not. It will ultimately determine whether there are aggravating features and we cannot be too prescriptive about aggravating features. Paragraphs 86 and 87 on page 18 make it clear how we see this. With that, I rest my case, other than to say that these tribunals have it in their power to take these issues into account. They can uplift the award by 25% should they so wish and we would obviously urge them to do so because we all want to see the right and fair things for employees and employers. With that I hope the noble Lord will withdraw his amendment.
Lord Young of Norwood Green
The Minister has still not addressed our main concern. I do not deny that the Government are spending significant amounts of money on training and we welcome that. Our concern is the worrying statistic produced by the Chartered Institute of Management which says that only one in five managers have any training. That is a worrying statistic. The purpose behind the amendment was to give a clear signal to employers that if they persist in failing to train their managers or having proper procedures they will pay a price. While we beg leave to withdraw the amendment, we will consider returning to this on Report.
Lord Young of Norwood Green
My Lords, Amendment 20N follows on from the previous amendment in that it also deals with unpaid compensation. This amendment would allow the tribunal, in making an award on a claim, also to specify a date by which that award should be paid, to be no later than a month following the decision. In addition, it would allow the Secretary of State to bring forward regulations to charge interest on any award that remained outstanding beyond the payment deadline specified by the tribunal.
On Report in another place, the Minister said in relation to unpaid awards that the Government are,
“consulting on two changes that I believe might have some effect on the number of awards paid promptly. They include proposals to put a date on a tribunal’s judgment specifying when payment should be made and to charge interest from the date of judgment where an award is unpaid after 14 days. These charges will apply to all cases, not just to unfair dismissal cases. Importantly, in that scenario the interest will be added to the award and paid to the claimant”.—[Official Report, Commons, 17/10/12; cols. 344-45.]
That consultation closed on 23 November. Therefore, I am very keen to hear from the Minister the Government’s findings in relation to this important issue and whether they will accept the opposition amendment that seeks to bring into effect a new power to ensure that compensation is paid to the individual. I beg to move.
Lord Marland
Of course we are in great harmony, even though I am sure I shall have it thrown back in my face. The consultation ended in November and we are about to publish the information. Incidentally, when we have established our response, I shall be very happy to have a private meeting with the Opposition—of course, there is no reason why it should be with just the Opposition; it should be with any noble Lords in this Room—to discuss the various aspects of this issue, and my officials will be at your Lordships’ disposal. I do not have the information to give the Committee chapter and verse right now but we will give noble Lords chapter and verse before we get to the next stage of the Bill.
I acknowledge that there is a problem with enforcing awards. With that in mind, and in order to recognise to some extent noble Lords’ interpretation of this matter in tabling this amendment and the reference to it at Second Reading by my noble friend Lord Razzall, we are going to commission some research before Christmas. We are about to appoint someone, who will report on the subject in April. We totally acknowledge that this needs to be right. All of us in this Room share the same concerns, and we are committed to going along the same path together. On that basis, I hope that the noble Lord will withdraw his amendment.
Lord Young of Norwood Green
My Lords, I welcome the invitation to discuss the issue with the Minister following the consultation. In the light of that assurance, I beg leave to withdraw the amendment.
Lord Young of Norwood Green
My Lords, this amendment follows on from the previous amendment and provides for the tribunal, when making an award on a claim, also to specify a date by which that award should be paid, to be no later than a month following the decision. It also allows the Secretary of State to bring forward regulations providing for the payment of interest on any unpaid awards. I would welcome the Minister’s response. I beg to move.
Lord Marland
Again, I think that I largely responded to this amendment in my comments on the previous amendment. We will be publishing our findings and are assimilating them at the moment. We have committed to publishing them in February, which we will do, and I do not really want to go into too much detail now. I am happy to talk about the whole issue at large with anyone who would like to know about it, and I hope that that answers the question raised by the noble Lord.
Lord Young of Norwood Green
My Lords, I think that that leaves us in the same situation we were in on the previous amendment and, again, I welcome that assurance. In the light of that, I beg leave to withdraw the amendment.
Lord Marland
I apologise. Of course, the noble Lord’s wisdom had been honed even further by 1998, which gives the speech more gravitas.
Lord Young of Norwood Green
I thank the Minister for his response. We will read Hansard carefully to see whether we need to return to the issue. I beg leave to withdraw the amendment.
Lord Young of Norwood Green
My Lords, I, too, support the thrust of what my noble friends Lord Touhig and Lord Wills seek to do with these amendments, which is to extend vicarious liability to whistleblowing legislation. This loophole has been graphically explained to us in the context of three nurses from Manchester who raised a concern about a colleague lying about his qualifications. The nurses raised their concerns within the service and the primary care trust and their concern was upheld. However, as we have also heard, the nurses were subject to bullying and harassment from co-workers. One of the nurses received a telephone call threatening her daughter and to burn down her home. As we have already heard, the case proceeded as far as the Court of Appeal, which found that vicarious liability does not exist in the Public Interest Disclosure Act as it specifically does in discrimination law.
We have also heard that shortly after the publication of the judgment the noble Earl, Lord Howe, the Health Minister, agreed that this area needs to be reviewed. Public Concern at Work reports that it routinely hears on its advice line about harassment and bullying of whistleblowers by co-workers. It is bad news for whistleblowers everywhere if those who are bullied by fellow staff members are not protected and represents yet another barrier that may inhibit workers from raising legitimate concerns, which are in the public interest, over wrongdoing by their employer. The amendment by my noble friend Lord Touhig would introduce a new clause that imposes a duty on employers,
“to take reasonable steps to ensure that the worker is not subjected to any detriment by any act, or any deliberate failure to act, by a person other than his employers done on the ground that the worker has made the disclosure”.
My noble friend Lord Wills proposes a further refinement to this approach, which would be to include personal liability against workers who bully co-workers for blowing the whistle. Such an amendment is likely to have a powerful deterrent effect and will mean that those who may otherwise be tempted to victimise a colleague for blowing the whistle may think twice because of their own potential liability for doing so. Again, this is included in the relevant Equality Act, that of 2010.
These amendments have even more relevance if we look at the current circumstances where the lack of whistleblowing in recent high-profile cases—such as the Jimmy Savile scandal, the high mortality rates under Mid Staffordshire NHS Foundation Trust and phone hacking at the News of the World—suggests that much more needs to be done to encourage and, perhaps even more importantly, protect workers blowing the whistle on malpractice and wrongdoing in the workplace. Workers are the eyes and ears of any organisation and often the first to know if things are going wrong or to have suspicions about malpractice in the workplace. Workers can prevent the disaster from happening and alert their own companies and regulatory authorities to prevent health and safety dangers, financial malpractice and environmental risks that may affect members of the public.
It is over 13 years since the Public Interest Disclosure Act 1998 and we believe that it is high time that the whole system should be reviewed—we would welcome the Minister’s views on that—to identify where further protection is needed to encourage employees to speak out when they see wrongdoing taking place.
Lord Marland
Again, we are extremely sympathetic towards and supportive of each other. It is not just the Cross Benches, the Labour Party and the Liberal Democrats who are keen to get this right but the Conservatives as well. I reiterate my thanks to the noble Lord, Lord Touhig, and Public Concern at Work, with which we are working very closely on this issue. I also thank the noble Lord, Lord Wills, for his input, even though we have not had the pleasure of discussing this subject outside this Room—something that I should like to do in future. I am jolly glad that we included the NHS provision in the previous amendment, because some progress seems to have been made there in view of some of the absolutely ghastly stories that have been referred to.
My noble friend Lord Brooke of Sutton Mandeville brought up a very important point. I am told that under the Interpretation Act “single” means “plural” when necessary, so I do not think that we would need to amend that in the amendment.
I have had wide-ranging discussions with the noble Lord, Lord Touhig, and Public Concern at Work across the whole piece, and those discussions have covered Amendments 23 and 23F, which we will be coming to in a few minutes. We are very conciliatory on all this, and on Amendment 23F, in particular, both parties have formed a set of words to deal with the issue of good faith and so on. I think we have found satisfaction with Public Concern at Work and with the noble Lord, Lord Touhig, so perhaps I may look at the issue as a whole.
We need to be careful when going down this route with Amendments 22 and 23. The truth is that the absence of vicarious liability and whistleblowing is not a loophole because there is legislation that provides for it, and it provides for both the employer and the employee. I am struck, as I always am, by the point made by the noble Lord, Lord Borrie, about the employee having protection as well as the employer. That is fundamental. Indeed, they would both be protected under the Protection from Harassment Act 1997; that is the legislation that they would return to in order to claim their rights. Therefore, they have the right protection in this area. It is a strong law that, sadly, has not encapsulated all the whistleblowing issues, but nothing is ever entirely encapsulated. However, whistleblowers have an absolute right and this amendment would put in another level of protection, which is not in the Bill because it already exists.
We should be looking at improving the guidance on this issue. I have instructed my officials to look at the guidance that we are putting on the government website to show where the rights of recourse are and what rights the employer and the employee have under the interpretation of the Protection from Harassment Act. This will be on our gov.uk website. On the basis that we will have an ongoing discussion between now and Report, I hope that the noble Lord will feel confident about withdrawing his amendment for the time being.
Lord Marland
The noble Baroness speaks with great authority on the subject. Of course, it is a difficult grey area. As we know the Employment Relations Act 1999 (Blacklist) Regulations 2010 already protects individuals but I am struck by what the noble Lord, Lord Young, and the noble Baroness, Lady Donaghy, said. If I may I shall take this away and give it some further consideration outside this Committee and perhaps come back on Report. The noble Lord, Lord Young, is looking surprised now—in fact, stunned—but it is Christmas time. I hope on that basis that he will withdraw his amendment.
Lord Young of Norwood Green
That is why I do not play poker. I am taking into account that it is a Christmas gift from the Minister. I accept his intention in good faith, which is a phrase we have been using, and I beg leave to withdraw the amendment.
Lord Young of Norwood Green
This amendment would place a positive requirement on lawyers advising in the settlement of claims that they advise claimants about their rights to be freed from any contractual agreement with their employer not to disclose certain information where they legitimately seek to make a protected disclosure. Little attention has been paid to the provision in Section 43J of the Public Interest Disclosure Act which outlaws any contractual clause that prevents workers from raising a public interest concern. The cases of Dr Kim Holt and Great Ormond Street Hospital relating to the baby P case—where the trust offered her £80,000 as compensation if she left quietly—and of the former inspectors at the Care Quality Commission giving evidence to the Mid Staffordshire inquiry highlight the need for greater attention to be drawn to Section 43J of the Public Interest Disclosure Act and for there to be tougher enforcement.
The amendment simply seeks to improve awareness among workers over their rights as whistleblowers by placing a simple requirement on any legal officer advising them over their case to make them aware of those existing rights under the Public Interest Disclosure Act. I therefore hope that the Government will look favourably on this amendment as a simple change that would help improve the application of the existing Act. I beg to move.
Lord Marland
My Lords, I am grateful for this probing amendment. However, I am not convinced that we need to go this way because we already have legislation in place. Section 43J of the Employment Rights Act 1996 provides that any term in an agreement which precludes a worker from making a protected disclosure is void. Furthermore, all lawyers have a duty of care to advise their clients properly on all aspects of the law, whatever the situation. That is their duty of care and, if they do not apply it, they may be struck off.
I understand the motive behind the amendment but I trust that the noble Lord will acknowledge that there is legislation in place and that it would just be putting icing on the Christmas cake, which in this case is a double layer and not entirely necessary. Therefore, I hope that the noble Lord will withdraw his amendment.
Lord Young of Norwood Green
I will take note of what the noble Lord said and give consideration to that view to see whether we need to return to this issue on Report, or whether we can clarify the matter further in our consultations. On those grounds, I beg leave to withdraw the amendment.
Lord Borrie
I hope the Government are positive about this amendment. Secret justice is inherently evil unless there is some very strong argument the other way such as public security. When this is not the case, the Government will have a very difficult job convincing us that things are all right as they are.
Lord Marland
I have a nasty feeling that I am going to disappoint the noble Lord, Lord Borrie, who of course speaks with a wealth of experience. I have observed tribunals over time, and what I have seen is that when names are published and the press get hold of it, they often put an imbalance into the equation. I believe that giving advance warning of the case means prejudice may build up against either side. This can often be seen in press reports on tribunal cases and I think that is unfair. Of the tribunals I have observed—although not been involved in—that have been reported in the press, there have been many times where I would say at the end of the day the press have taken one side or the other and not given a balanced view—and that is what becomes of a public airing.
No one is saying for a moment that this process should not be transparent but people are saying that there should be fairness. This applies to both parties. We accept the transparency issue but I am afraid that, on this basis and from the experience that we have had, and my experience in particular, I do not think it is fair on either party. As such, it is not an amendment that particularly finds favour despite the fact that we seem to have agreed on most things today and will doubtless continue to do so. In the spirit of Yuletide, I hope the noble Lord will agree—I am looking at his face now because he is playing poker—to withdraw his amendment.
Lord Young of Norwood Green
I cannot say we are particularly happy that Christmas has ended early with the Minister’s response. The best I can say is that we will take this one away and reserve the right to return to it on Report. I beg leave to withdraw.
Lord Marland
I am grateful to the noble Earl for giving me advance warning that he was going to raise that issue, and I am happy to deal with it in a moment. First, however, I must deal with the point raised by the noble Baroness, Lady Turner.
I think that there is some misunderstanding here. It is already the case that where a deposit is paid it is always refunded to the paying party unless a cost order is made by a judge. That is the case. Refunds happen whether a case continues to judgment or is withdrawn part way through the proceedings, so there is always the case for recourse. In fact, the Government have accepted Mr Justice Underhill’s recommendations that there should be much more flexibility in the deposit-paying order regime. I hope that the noble Baroness is content that that deals with that issue. I do not know how this misunderstanding happened, but we can certainly talk further about it afterwards.
We recognise that there has been a trend for discrimination claims to obtain large awards. They are trailed as discrimination claims because people think they can get the sympathy of the judge in advance or during the case, because discrimination is not an attractive thing to be accused of—or to suffer from, much more to the point. Therefore, we as a Government are committed, working with the employment tribunals, case-by-case, to see how we can improve that. Obviously, as the noble Earl says, if we follow the procedure of going to ACAS first—and of course ACAS has many more resources and greater teeth, as applies to various earlier amendments—we can deal with this much more vigorously and much more fairly, as the noble Earl rightly seeks. I am happy to discuss the matter with the noble Earl later, as are my officials, but, on the basis of what I have said to the noble Baroness, I hope that she will withdraw her amendment.
Lord Young of Norwood Green
Thinking that I was back in my TUC days, I was almost tempted to make a point of order. The noble Earl was stretching what you can do with an amendment by introducing something that had nothing whatever to do with it. If I look back, I suppose that I have been guilty of that transgression occasionally, but I think that that was taking it a bit too far, as it was for the Minister to respond to it. I say that seriously because, if we are to have a debate about discrimination, let us have a proper debate about it, for which we are prepared. We, too, could evidence all sorts of things.
Lord Marland
The noble Earl gave me notice that at some point he would be raising this issue. We have debated a whole range of issues and I do not think that we need to be unfair and limit any particular issue. I was happy to take the question. I have dealt with it and we will continue to deal with it. I totally agree that it is not in the context of the amendment, but we have had a few things that have not been in the context of amendments. We are a charitable group here. The noble Lord is playing poker again now but he will be in a charitable mood as it is Christmas, and that is why I was happy to deal with the amendment.
Lord Young of Norwood Green
I will not pursue this further but I maintain my point. We roam far and wide in dealing with amendments but, if we want to do something as serious as that, it ought to be on the basis of either an amendment or a debate. I say no more than that. I leave it to my noble friend Lady Turner to deal with her amendment.
Enterprise and Regulatory Reform Bill
Debate between Lord Young of Norwood Green and Lord Marland
Lord Young of Norwood Green
My Lords, I support the amendment. I am still trying to get my head around the vision of the noble Lord, Lord Marland, as a recruiting sergeant, and I look forward to seeing him at the next factory gates recruitment session. More seriously, this is an appropriate amendment given the background against which the further involvement of ACAS is taking place. Let us be clear on the principle of what the Government are doing. We are at one with the principle of involving ACAS in mediation and conciliation. There is no argument against that. But, as a number of my noble friends have said, if the Government want the ends, they have to will the means. That is the real concern behind the amendment.
As my noble friend Lord Monks said, it is being introduced against the backdrop of a number of other changes being made to workers’ rights, such as the extension of unfair dismissal to two years and the introduction of fees. A lot is going on in this area. We are not opposed to the principle, but we are concerned about whether there will be enough resources. Although the noble Baroness, Lady Brinton, talked about a review, we are actually talking about the anticipation of an impact assessment. We agree about the need for a review, but that will take place in another amendment. I would be interested if the Minister could tell us what the effect of introducing conciliation right across the board will be. Has the situation already been assessed?
It could be said that to a certain extent this is a probing amendment, but we regard it as a serious one. Our concern is that if you want the involvement of ACAS and if it is going to function in a way that will enable it to carry out a conciliation and mediation role, we all need to be assured that the service has the necessary means to do it.
I look forward to hearing from the Minister as to whether the Government have assessed the impact of this issue, including on other areas such as fees. What do they see as the necessary resource requirements of ACAS in its new situation?
The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills (Lord Marland)
My Lords, I thank the noble Baroness, Lady Donaghy, for the amendment. It is, quite rightly, an interesting area to probe. I also compliment her on her work as chair of ACAS and the work of its board.
In summary, this is a nice problem to have. We all agree that ACAS is a terrific institution. It probably sounds rare for this Government to say that they thought it was a very good institution, but we believe strongly in it as an important place to resolve difficulties. That is why we intend to put much more in the way of resources into it, and it will become a fundamental block for early resolution of a lot of disputes. We know it acts fairly and properly, it has a good track record, and we are keen to support it.
I know that many noble Lords have read our recently published impact assessment on resolving workplace disputes, which helps to answer a number of issues that have been raised. We will produce in the new year a further impact assessment on how this process will work and whether the funding should be upfront, which the noble Baroness asked for. We are working to determine the extent of the funding and how best it is to be provided. I hope that by the time we get to the Report stage in the Chamber, quite a lot of the questions will have been answered.
It is important that we get it right and that we listen to the words of the chairman, who said, in front of the House of Commons Committee, that he was confident that ACAS would be adequately funded for its new task. Do not, therefore, take it from us; take it from him that he is confident he will get the right funding. We are working closely with him and the organisation to make sure that we do that. I totally accept and agree, as do the Government, that it is critical that ACAS is properly funded, and we will be able, in the normal course of its annual report, to see how that funding is operating. Noble Lords will be able to judge for themselves annually how that is improving and, through the normal avenues, determine that the progress we hope for on all sides of the House is being made as satisfactorily as possible.
I thank the noble Baroness for this probing amendment. It gives me an opportunity to lay out clearly how we are going to proceed. On that basis, I hope that she will withdraw the amendment and look to see how this develops in the next month or so.
Lord Young of Norwood Green
My Lords, this is again a legitimate probing amendment. I, too, would be interested in getting some reassurance from the Minister about the process of conciliation. We hope that the conciliation process will work but there are going to be cases—I guess a significant number—where it does not. I suppose that the aim is to ensure that we do not insert any more delay than is necessary. The point about a certificate has already been raised. It would be useful if the Minister could confirm that the clock does not start running again until after the certificate has been issued.
Lord Marland
I am very grateful for this probing amendment—well I am sort of grateful, as much as one can be for an amendment. I recognise the noble Baroness’s direction of travel—time is crucial for someone who has lost their job. The whole point is to be able to get a quick resolution so they can go back and find another job or sort out the problems between them. We all agreed in an earlier amendment that ACAS is in an unrivalled position to do that and that is why we are very keen to support this direction of travel.
Having been quite a significant employer myself—and employee, as I thought in my own mind—and on one rare occasion been associated indirectly with a tribunal and seen how it was operated, I have deep concerns for both the employee and the employee about the terrible time it takes to go through a tribunal. It can be months before a decision is made and hours can be spent often on quite simple things. Both employee and employer are hung out to dry for months on end, not knowing what the cost is going to be, what the result is going to be and whether they will be able to go back to employment. It therefore seems to me that this is a simple process putting firmly in the domain of ACAS the opportunity to resolve an issue before going to the tribunal. It does not stop a party going to the tribunal, of course—it is well within their rights to do so. There is every opportunity to do so.
I emphasise that the Government are open to listening to other alternatives, if a better alternative is found, but I think that most of us here think that ACAS is the right place to go and that if we can have a speedy resolution to our problem, we should do so. I know that other noble Lords have had experience in this area. We would be open to suggestions from the noble Baroness about alternatives.
I am not sure that I can deal with the specific point that the noble Lord, Lord Monks, mentioned because he knows far more about it than I do. I would like to consider the question and drop him a note on it. It is something I want to get my head around. He has probably set me a huge elephant trap that I will stumble into unbeknownst.
I hope that I have given the noble Baroness a clear line of travel and—
Lord Young of Norwood Green
I want to be clear what the Minister is going to clarify. I asked about when the clock starts. Is it after the certificate has been issued? I would be grateful if that could be clarified.
Lord Marland
I can clarify that. The certificate is necessary to demonstrate compliance with the obligation. It would have to be issued within that framework.
Lord Young of Norwood Green
My Lords, this is an eminently sensible proposal and I am sure that the Government are going to review the workings of ACAS in the light of the new procedures. My noble friend has set out in graphic detail the likely impact of what is taking place. We need to ensure that we get this right, because if we do not, we are likely to see the law of unintended consequences take effect. I shall be interested to hear from the Minister what review process the Government have planned, and what the timescale is.
Lord Marland
I can give noble Lords a very simple answer because both the Government and the people observing us will want to make sure that there is a review of how ACAS is performing. As the noble Baroness will know better than I, having been the chair of ACAS, it has to report annually to the Secretary of State, and we will insist on that. For those who are interested, it is set out in Section 253 of the Trade Union and Labour Relations (Consolidation) Act 1992. I can tell the noble Baroness that early conciliation will form part of that report, so in our view there is no need to have a separate report from what is embraced in the annual report. I hope that satisfies the noble Baroness, but I want to say that it is fundamental that this is reviewed and that the whole thing is taken seriously. The report is published and will be available in the Library of the House, so everyone has an opportunity to read it and make sure that everything is progressing in the way we all hope it will.
Lord Marland
Members on the Benches opposite make some very timely comments on this amendment because at the moment the Government are reviewing the response to the consultation. One of the elements of that review is rapid resolution, which involves legal officers, so we will obviously consider the points that the noble Baronesses and the noble Lord, Lord Young, have made. As I say, they are timely.
I say in response to the noble Lord, Lord Young, that decisions of a legal officer would be reviewed by a judge, so there is someone looking over their shoulder, and any decision by a legal officer could be reviewed or, indeed, reversed within the existing provisions in the employment tribunal rules. I think we have a level of comfort there but, as I said, this is a timely amendment. It is not something on which we have resolved our position. Noble Lords have identified a number of areas of concern. As we are in the middle of a consultation process, we will obviously take those into account. We will, I hope, have come to our conclusion by Report, when we can talk further and explain what is going on. On the basis of those comments, I hope that the noble Lord will withdraw his amendment.
Lord Young of Norwood Green
I thank the Minister for the assurance that he will give us a more detailed answer prior to Report, pending the results of the consultation. We have stressed the importance of ensuring that the individuals have the right training. We have also stressed the importance of establishing,
“the appropriate remit of proceedings that an appointed legal officer could determine”.
Given the assurances that I have received from the Minister, I will withdraw the amendment. However, if we do not get a satisfactory response, we may return to it on Report. I beg leave to withdraw the amendment.
Lord Marland
I am not denying the issues that the noble Baroness refers to. No one is. We completely understand those issues. As I referenced earlier—the noble Lord, Lord Monks, referenced it, too—the judge can turn to external advice to support them in a case if they need to. There are complicated circumstances but, in relation to this amendment, the reality is that they are being invited to make a judgment based on the law. It is not about the extenuating circumstances; it is not a question of asking, “Should we give them more money?”. It is about the law and the interpretation of the law in coming to a judgment. Other aspects are involved, which is why the ACAS system is so good because it is conciliatory between two parties. In this instance, however, where you are being asked to interpret the law, we believe that the judge is the person to do that. We totally understand all the permutations around employment disputes, but at the end of the day it is the judge who will determine it. An employer or an employee should want their case to be found within the law by someone who can interpret it.
Lord Young of Norwood Green
My Lords, having heard what the Minister said, I admit that I find his response deeply unsatisfactory. He said that that is what an employer or an employee should want because it is only a point of law. Although this debate has touched on other amendments, what we are saying through this amendment is that if things are as clear-cut as the Minister has said, having the consent of both parties for the judge to sit alone should not be a problem. I do not think that it is as clear-cut, for all the reasons given. The noble Baroness, Lady Brinton, pointed out the importance of diversity, which is what lay members bring. A range of other points have been raised. My noble friend Lady Donaghy said that the employment context needs to be taken into account, not just the law. That is what lay members bring to the legal analysis at the Employment Appeal Tribunal. We are in Grand Committee, so we will withdraw the amendment, but we make it absolutely clear that we will return to this on Report, because the Minister’s response does not deal with the genuine concerns that have been expressed on both sides of the Committee.
Lord Young of Norwood Green
My Lords, this again could be seen as a probing amendment but it would constitute useful, practical advice or guidance for judges. It is a simple amendment which seeks to place a duty on the Secretary of State to prepare guidance for judges regarding situations where it is appropriate for them to sit alone. It would be helpful to define those criteria. Such a definition could take into account the points that have already been made about the need for diversity and the need to have an injection, as it were, of lay experience and wisdom. I think that is fairly straightforward.
I wish to speak also to Amendment 20F which would impose an additional duty on judges to have regard to the Secretary of State’s guidance under the terms of Amendment 20E and, if it is decided that a judge should sit alone, would require that a statement be published explaining the reasons for that decision. That would provide reassurance to those appearing before the tribunal. It would probably also establish some useful precedents in these cases regarding when such a measure is appropriate.
Amendments 20E and 20F are both probing amendments but are reasonably practical examples of how we think that this clause could be suitably amended if we are going to go down this road. I beg to move.
Lord Marland
My Lords, I am afraid that I have a slightly different philosophical view on this matter from that of the noble Lord, Lord Young, although I recognise that this is a probing amendment. I do not think that it is for the Secretary of State or, for that matter, government to intervene in the judiciary. The judiciary should be set aside from government and particularly from some, if not all, Secretaries of State. Whereas I understand the accountability aspect, I do not think this is the right form in which to set it out. Clearly, Parliament sets the framework for these tribunals and how they are managed but I do not think that it is for the Secretary of State or the Government to interfere in this. I am sure that the noble Lord, Lord Young, having been in government himself, and with all his wisdom and experience in these areas, will recognise that that does not strengthen the situation. However, we will doubtless debate this matter further and other ideas will come forward. We are always open to ideas, as we should be, but I hope that with those comments he will withdraw his amendment.
Lord Young of Norwood Green
The noble Lord did not really address Amendment 20F, which talks about imposing an additional duty on judges. Even if he does not like the idea of the Secretary of State providing guidance, part of the amendment refers to publishing a statement explaining the reasons for a decision if it is decided that a judge should sit alone. I would welcome a response on that.
Lord Marland
I apologise; I should have responded on that. I was more interested in the overall scheme of the thing. Our view is that this measure would interfere with the discretion given to judges and that it is up to the judges to decide whether they should sit on a panel or not. I do not think that they necessarily need to justify that because we have empowered the judges to take the action if they so wish.
Lord Young of Norwood Green
My Lords, I want to respond to a couple of points that have been made. I am happy to delete “Beecroft-lite”, if that is causing the noble Lord, Lord Deben, to break out in a rash. The plain fact is that as a result of the introduction of this clause, an employee can be called to a meeting without advance notice of the topic or a formal grievance between the employer and employee, and be presented with a proposal for them to leave their employment for a small payment and after signing a confidential settlement agreement.
I hesitate even more to dispute or cross swords with the noble Lord, Lord Phillips, because in some ways I do not feel qualified to do so. However, it is quite relevant that you should be accompanied by someone if you are going to be called to such a meeting. Perhaps we do not have the wording absolutely right and we will take that into account, but I am merely describing the situation that the amendment was intended to react to, and I apologise if it is not exactly right. However, I agree with my noble friend Lord Monks that this fundamentally changes the nature of employment. As my noble friend Lady Donaghy said, if we really want to give employers some helpful advice on employment relationships, this is not the route that we should going down or the advice we should be giving them. It represents all the negatives.
I am fascinated that termination of employment is the most important thing to focus on as the answer to our current employment problems. When the Chartered Management Institute tells me that only one in five managers receives any training at all these days, I consider that to be a far more important area for us to focus on. I do not make any apologies for the amendment, even though it may not be precisely right. The clause fundamentally changes the nature of the employment situation. In answer to the noble Lord, Lord Brooke, on whether the amendment is unbalanced, we do not think it is. The clause as currently drafted is unbalanced because the employer has the right to call you in without any prior notice and for no apparent reason, and suggest that your employment should be terminated. If only employers could get their contracts of employment, their training and their appraisal procedures right. From my experience of dealing with employers, that is the sort of advice that we should be giving them.
Lord Marland
I note the legal brain of the noble Lord, Lord Phillips of Sudbury, and I am grateful to him for pointing out some of the weaknesses in this amendment. I was also struck by the words of my noble friend Lord Deben. This is a mild change. Listening to the Benches opposite, you would think that we had torn up the law. Scenes from “Oliver!” kept coming back to me while noble Lords were speaking. We are not going to make progress if on the mildest proposal we start bandying words like “Beecroft” and warn of terrible things. All this is doing is mildly redressing the balance that exists, which noble Lords opposite may not agree with because they have taken a position on it. People on this side agree with it. I am grateful to the noble Baroness, Lady Greengross, because she made a very good point at Second Reading that we have to get the balance right so that employers are given the confidence to start employing again. That is all we are trying to do here. We are not seeking to tear up the rulebook, as has been suggested. Indeed, my noble friend Lord Brooke of Sutton Mandeville came right to the point: the claimant has to have legal advice before agreeing a settlement. Nothing will change that and we are not tearing it away; he has to have legal advice. So far as we are concerned, he can get it from any suitable or qualified individual and, obviously, even from trade unions.
It is fundamental that we ensure the safeguards for both the employer and the employee. It is fundamental that an offer is made and that the claimant is properly guided through the process and understands its extent. But as the noble Lord, Lord Brooke, pointed out, the claimant is the only person who is legally able to take advice because the employer is not. On that basis, something of a mountain has been made out of a molehill and I hope the noble Lord will withdraw his amendment.
The noble Baroness, Lady Brinton, again turned to the subject of discrimination. I am told by my officials— I am happy to amplify if my response now is not adequate—that a tribunal would take into account a discussion of the settlement for discrimination element of a claim, but would disregard that information when deciding the unfair dismissal element. I hope that that clarifies the point, but if not, of course I and my officials are at the disposal of the noble Baroness at any time.
Lord Young of Norwood Green
My Lords, I really want to respond to the point about restoring the balance. An employer now has two years to decide whether an employee is suitable. That is two years where you have the opportunity to appraise them, train them and find that they are not responding to that. It really harks back to the point made previously by my noble friend Lady Donaghy that the procedures are there and that if an employer acts in a proper manner they can dismiss employees. I would not demur from that. There are employees who do not measure up. What we do not support, and indeed oppose, is the idea that you can carry out this process and somehow the evidence of settlement and negotiations is not there and is not admissible in any dismissal claim. I will withdraw the “constructive and unfair dismissal” claim because I realise that that offends the legal precision.
We are quite clear that the idea that confidentiality should be used in these circumstances is not just a question of rebalancing. It is not, in our view, in any way helping the prospects for future employment. If we really believed that that was the case then maybe we would consider it, but I doubt it because it seems to us that it is both unfair and unjust. This is a perfectly reasonable amendment and it will be another reluctant withdrawal. We will return to it on Report.
Lord Young of Norwood Green
I do not need to detain noble Lords too long in this case. We believe that it would be appropriate and necessary for balance, fairness and justice for the employer to provide an individual with a written statement on reasons for any settlement offer that ought to be admissible as evidence in any unfair dismissal case. To use the phrase about restoring balance again, we believe that, if we were to go down this road, this amendment is necessary to restore balance and provide justice for an employee who is facing the prospect of dismissal and the difficulty of finding future employment. I beg to move.
Lord Marland
I do not want to delay the noble Baroness, Lady Turner, any longer so will just very quickly say that the Government believe that this amendment undermines the purpose of the clause. However, we have been in consultation on this. That consultation closed on 23 November, and we are considering the responses at the moment. We will obviously publish those responses before Report and will have something more to get our teeth into, although we will doubtless disappoint the Opposition with what we come up with. On the basis of what I have said, I hope the noble Lord will withdraw his amendment.
Lord Young of Norwood Green
I do not want anecdotally to try to assess whether the majority of employers are good, bad or indifferent. They occupy a spectrum. Many are good and others are not so good. I say to the noble Lord, Lord Deben, that settlements are currently made outside the tribunal. We do not need to go down this road. I am sorry but the only interpretation we can put on this is that it encourages bad employers. Where does it encourage proper appraisal procedures or proper training procedures? If we really thought that this was about restoring balance, encouraging good practices and good behaviour and encouraging extra employment opportunities, as my noble friend Lord Stevenson of Balmacara said, then of course we would support it. However, in our view it does none of those things, which is why we strenuously oppose it.
Lord Marland
The noble Lord, Lord Young, has just explained why the Benches opposite have got this wrong. All they have talked about is the employee. At no point have they said, “What about the employer? Does this measure in any way improve things for the employer?”. The employer is the person who will employ people, provide jobs and create new jobs. My noble friend Lord Deben made the case beautifully; I need say little because he put it so well. This is exaggerated rhetoric and nonsense. The measure is a mild change but all we are getting is exaggerated rhetoric as if we are all going back to the workplace run by bad employers with bullying and all this sort of thing.
We know that bad employers go out of business—they go out of business fast because people do not want to work for them. They are not good employers, so they go bust. Good employers, who are the larger proportion of people, exist. Very strong rules and regulations have been improved over time—rightly so—and this Government are not saying under any circumstances that they should not be improved, or that they should not have been improved in the past.
We are trying to speed up the process and give people legitimate rights and clear interpretation of the law; then both parties will benefit. Employers will employ more employees, bad employers will go out of business, and bad employees will no longer be employed. At no point has anyone said “What about the bad employees? How do we get rid of the bad employees, who are a burden on good businesses and stop them surviving?”.
Lord Marland
I am not giving way, because we have had enough on this. We have heard everything that the noble Lord has had to say on it. This is a matter of debate, and we will doubtless say more.
Ultimately, we are all coming from the same place. We want good employers and good employees. We want them both to be properly represented and to have the opportunity. As my noble friend Lord Deben says, this simply puts a mild balance back. What employers would like to see happen is just as important as what employees want.
Lord Young of Norwood Green
I wish to put the record straight on one point. I specifically mentioned that there was a proper way to deal with—to use the Minister’s phrase—“bad employees”, or employees who fail to live up to the mark. If the appraisal system is done properly, then there is a route to dismissal.
Lord Marland
I am not going to get into that for the moment, but I am sure we will pick it up later. The Government take the matter of this cap seriously and that is why we are consulting on it. The consultation closed on 23 November and we will publish the response before we reach the Report stage, so we will be able to have a good debate on it. I thought that the noble Lords, Lord Young and Lord Monks, made some very poignant remarks, and we share their concerns. We also acknowledge the keen detail of the facts that have been presented. There are very few cases which get to the limit, but they are important. The average award is £5,000, of course, and the cap is £72,300. We recognise that, we understand it; we know that we have got to get it right. We are obviously sympathetic to a number of the cases that the noble Lord, Lord Young, has mentioned and, with that, I hope that we can revisit this in the spirit of co-operation because I think it is important, and that we can be conjugated—conjugare, which means to bind together in the same outcome—in time to come.
Lord Young of Norwood Green
I would not say that it is peace in our time but it is not a bad offer. I genuinely thank the Minister for his response. In the circumstances, I beg leave to withdraw the amendment and I look forward to the further consideration as a result of the consultation.
Employment: Science and Technology
Debate between Lord Young of Norwood Green and Lord Marland
Lord Marland
Naturally, we have been talking with the Royal Academy of Engineering and the Royal Society on this issue. We are having a very keen dialogue with them.
Lord Young of Norwood Green
My Lords, we welcome the efforts of the university technical colleges, careers advisory and others, but what we really need for young people is more apprenticeships. That has to be the focus. I have looked at the figures in this area, and they are rising but slightly. There is one area where the Government could make a positive contribution, and that is in public procurement contracts. We still have a Government who will not insist that, every time a public procurement contract is let, those who get it have to indicate how many apprentices they will take on. Will the Minister explain why the Government will not move on this issue? After all, this would be a case of them leading by example.