Small Business, Enterprise and Employment Bill

Debate between Andy McDonald and Sheila Gilmore

Wednesday 19th November 2014 Commons Chamber

[Sheila Gilmore (Edinburgh East) (Lab)]

I shall speak to the amendments, but this debate is about zero-hours contracts, and it is interesting that we have even got to the point at which there is a Bill addressing this issue. That is a good thing, because as this became an ever bigger issue for many people over the past two or three years, there was a lot of resistance from the Government. Initially, they said, “It isn’t really a problem. There aren’t more zero-hours contracts than ever before. People have the choice to work as they want, and we really don’t need to legislate.” The campaigns and the substantial criticisms have now got us to a place where the Bill includes a provision on zero-hours contracts.

The problem is that the provision is very narrow. Outlawing exclusivity clauses in zero-hours contracts deals with only one part of a much larger problem. The Government must have thought, “Well, we’ve come under sustained criticism about zero-hours contracts, so we’ll show that we’ve done something. What’s the least we could do? We will ban exclusivity clauses.” Many people realise that that is a minimal response.

For me, the major factor is the degree of choice that people really have in their workplace. I have heard several Members say on Second Reading and in Committee, where the issue was also debated, “It’s all right. People choose to work in this way. It gives them flexibility as well. It allows them to plan their lives.” Reference was made to people with child care responsibilities, for example. However, it is precisely those people who often find it hardest to cope with being in such a situation. Far from giving them the ability to juggle their various responsibilities, a zero-hours contract may well be the one thing that makes it very difficult to continue in their job while sustaining those responsibilities. People with child care or any other caring responsibilities need to know, day to day and week to week, when they will be working.

Most people cannot arrange child care at the drop of a hat. When my children were young, I used to say that my parents were the only people in the world whom I could phone at 8 o’clock in the morning and say, “My child’s ill. Could you come, please, now?” Not everyone has parents who can drop everything on that sort of warning. I would not want to do that for anything other than a real emergency—the school’s boiler is bust and there is no school, or a child is ill—because if people have to keep doing it, they will quickly lose the support of their friends and family. To fulfil their caring responsibilities, people have to know what is happening. A lot of part-time jobs fit that bill well. It is not a great deal of help if part-time jobs are turned into jobs where people are told, “We’re not really sure which days it will be this week—we’ll let you know.”

Amendment 10 says that there should be compensation if people are called out to work but are not given work. We must understand that there are costs involved in that. My hon. Friend the Member for Edinburgh South (Ian Murray) mentioned transport. People might also incur child care costs to cover the hours they think they are being given, only to find that they are not there.

For many of the jobs where I have seen people on zero-hours contracts, there seems to be no compelling reason why there cannot be a much more organised set of working arrangements and why the arrangements have to be quite so flexible for the employer. In most businesses—even retail businesses—where there are ups and downs in the week, and indeed in the day, the patterns are knowable: they do not suddenly differ from one day to the next.

That is similarly true of caring. The point when I really began to lose patience with zero-hours contracts was when constituents of mine who work as carers found themselves getting texts early in the week telling them which days they would be working. The people they care for are there all the time. The number of people on the books who need care is well known. It should not be beyond the possibilities of management to work out fairly well in advance what the need will be and to allocate the staff accordingly.

[Andy McDonald (Middlesbrough) (Lab)]

Does my hon. Friend agree that one of the most grotesque manifestations of the way in which such regimes impact on those in the caring profession is that they are paid only for the time when they are in attendance on the person who is receiving the care and do not receive the hourly rate while they are logging in, logging out and travelling to the next appointment? That exposes them to great risk on the roads, because they move quickly between appointments. Does she agree that we really must address that in these provisions?

[Sheila Gilmore]

I absolutely agree that such methods are used to manage the process, and they might make it look as though the service can be procured more cheaply. I assure anyone who thinks that we in Scotland somehow do not have a problem with social care because some elements of it are supposedly free that that is not the case—we see all the same things happening.

The insecurity for the worker is huge. I see no reason why that should be the case when the work is there. It might take a bit more juggling, but firms have been trying for years to work out how best to spread the work force over the week.

In the care industry, there may well be a need for some form of emergency cover, but that is different from regular work. I have heard the argument that it is all very well to say that the people who need to be cared for are known about, but if somebody goes off sick or is on holiday, somebody else is needed so that urgent arrangements can be made. That may well be the case, as it is in teaching. There are long-standing arrangements involving supply teachers. We are back to the issue of choice. If people choose to work in that way and it is limited to situations where cover is needed, clearly it has a place. However, the firms that are using such arrangements are not using them just for emergency cover; they are using them for the predictable times, too.

If people end up doing longish periods of regular hours, they should be offered a proper permanent contract. By that stage, people are tried and tested, by definition. There is no reason for the employer to think that they are not capable of doing the job. In many fields of work, the practice would encourage retention, which is a problem in some of the fields that we are discussing. In a job as important as caring for other people, but not just in that job, it is crucial to deal with issues such as turnover—people not staying the course—because they affect the quality of care. This is not just an issue for the people who are employed in these fields; it is hugely important for those who receive the services—they want certainty about the person who is coming into their home.

--- Later in debate ---

[Sheila Gilmore]

That is an important comment, and it illustrates again the importance of giving people protection that they do not necessarily have at the moment. In a lot of situations, the employee is perforce in a much weaker position than the employer.

I fully accept that there can be circumstances in which people can find contracts such as we are discussing a useful way to live their lives, provided that they have equal bargaining power. I remain slightly unclear, however, about why people who want choice would not on the whole be better operating on a self-employed basis. There are a lot of people who have been doing regular work and who everybody knows are employees, but who cannot easily get permanent work. Some employers might find it difficult to rearrange their planning to let them have a permanent arrangement, but things seemed to operate on that basis for many years. I cannot understand why it has suddenly become so difficult for employers to manage.

[Andy McDonald]

The fundamental point is about choice, which the hon. Member for Macclesfield (David Rutley) touched on. Does my hon. Friend agree that the power has shifted enormously over the past several years? There has been an explosion in the incidence of zero-hours contracts, and the employee does not have the choice of whether they want one. It is a case of “take it or leave it”, because that is all that is available to them.

[Sheila Gilmore]

My hon. Friend echoes the point that I was seeking to make. If there were equality of arms and people were negotiating on an equal basis, that would be different from a situation of “take it or leave it, and be grateful for what you’re getting. Arrange your life around all the constraints.”

In many ways, the Opposition’s amendments are modest. They are not asking for huge changes, but they go beyond the miserly reforms to zero-hours contracts that the Government are offering. I think the Government want to get brownie points by saying that they are now dealing with the problem of zero-hours contracts—the Prime Minister mentioned them today—but the Bill’s provisions simply do not go far enough. I urge the Minister, even at this late stage, to consider supporting the Opposition’s amendments and strengthening the Bill’s provisions so that the Government can say that they are making a proper effort to deal with the problem.

[Bill Esterson]

In evidence to the Committee, Sarah Veale from the TUC said that there is a significant difference between what she called the higher end of the employment market, which is often where trade unions are organised and staff are well paid, and other areas. She stated:

“Our worry is with the unscrupulous employers who use these contracts deliberately as a means of cutting wages and having people available, the flexibility being to their advantage and not so much to the advantage of the worker”.

When talking about provisions in the Bill she said:

“A lot of work will need to be done with the regulations for this to ensure that there are no easy avoidance tactics used by unscrupulous employers.”

That is what the TUC said about what the Bill sets out to do, where the gaps are, and how much more work is needed to make it effective for staff who otherwise would be exploited.

Yesterday we talked about the impact that uncertainty has on people—whether tenants in pubs or small business owners and managers more generally—and on their communities and staff. Today we are considering people in employment, and my hon. Friend’s amendments set out how important it is to look after people who otherwise face uncertainty and difficulty as a result of low pay and everything that follows from it.

East Coast Main Line

Debate between Andy McDonald and Sheila Gilmore

Wednesday 5th June 2013 Westminster Hall

[Andy McDonald]

I wish I could put my finger on it. My hon. Friend highlights a key issue, but it is useful to note that the way East Coast operates is a good comparator for the other services operating in this country.

The improvements are reflected in two key metrics. First, under public ownership East Coast achieved a record-breaking 92% overall customer satisfaction rating in the autumn 2012 national passenger survey conducted by the independent transport watchdog, Passenger Focus. That is the highest score on the franchise since the survey was launched in autumn 1999. It is 5% ahead of the score achieved in 2011 and three percentage points higher than the 89% average for all long-distance train operators. Indeed, in 2012, East Coast received the highest customer satisfaction score of any long-distance franchise operator.

Secondly, complaints stand at a rate of 150 per 100,000 journeys according to the Office of Rail Regulation’s latest available figures—down considerably on the previous quarter and back to the level prior to the disruption from the end of last year. Although that figure is relatively high compared with those of other train operating companies, it is just one third of where it stood when the east coast main line was in private ownership in 2007-08. A higher-than-average complainant rate might be due, in part, to the nature of the line regardless of its ownership, but since it is the publicly owned and publicly operated London Overground that has the lowest rate, at just two complaints per 100,000 journeys, it is difficult to claim a direct relationship between public ownership and complaints.

In addition, perhaps because of the unprecedented investment in staff that I have mentioned, there has been a 78% reduction in threats to staff in the past year. The apparent contradiction between a rise in customer satisfaction and a relatively high complaint rate dissolves entirely when we look at the Office of Rail Regulation’s breakdown of the reasons behind the grievances. Complaints about train service performance are down, year on year, from 38% to 29%, but what are on the increase and make up more than a fifth of all complaints are criticisms of the quality of the trains themselves. That comes directly from the fact that the rolling stock, which East Coast inherited from National Express, is eight years older than the industry average, at 27 years as opposed to 19.

That East Coast has achieved better customer satisfaction than any of its long-distance rivals, while running the oldest rolling stock of any franchise bar Merseyrail Electrics, is a testament to the workers and the management, and that the trains are still running at all after 30 years or more of continuous use is a testament to the brilliance of the engineers of British Rail Engineering Ltd who designed them and the factory workers of the north of England who built them.

Some elements of on-train comfort have also seen a marked increase. Of particular interest to certain hon. Members will be the new first-class complimentary at-seat food and drinks service, which has reversed historical losses of £20 million per annum and which contributed to a 21% rise in the number of first-class journeys in 2011-12, compared with the preceding 12 months. East Coast now serves a million meals per annum, which is a tenfold increase on the previous service, and its first class has certainly looked very nice on the occasions when I have walked through it.

[Sheila Gilmore (Edinburgh East) (Lab)]

I am very pleased that my hon. Friend succeeded in securing this debate. The first-class service, which, as MPs, we do not of course use, is important because of the environment. For many business travellers, it can make a considerable difference to their choice between flying—certainly from Scotland—and travelling by train. If we want to make the modal shift that we need for our environment, we need a service that will attract that kind of business traveller.

[Andy McDonald]

I agree entirely with my hon. Friend. The carbon footprint that we all imprint upon this planet is a vital issue, and she makes that point eloquently.

Ministers have admitted in the House of Commons that new investment in both rail infrastructure and new rolling stock on the east coast will come through taxpayer-funded support and not from franchisees. Funding for the 2014-19 upgrade of the east coast main line will be delivered through the Office of Rail Regulation approving a £240 million increase in the value of Network Rail’s regulatory access base. Regardless of whether the refranchising of the east coast main line goes ahead, the public, through Network Rail, will still be paying for the track. We will still be paying for the rolling stock, and we will still be paying for any upgrades, extensions or electrification that might ensue. None of the upgrades is dependent on whether the trains going along the track are painted Virgin red or Stagecoach orange. There is no deadline by which the franchise must take place, except, of course, the next election.