Employment Law (Businesses)

Anne Marie Morris Excerpts

Wednesday 3rd November 2010 Commons Chamber

[Julian Smith]

I agree with my hon. Friend. That is all part of the same burden.

The second piece of legislation that we are going to acquire from Labour is the measure on additional paternity leave. The time spent learning about and then administering the process of additional paternity leave will have a huge impact. From early next year, rather than focusing on job creation, business will be administering how best to let dads go off. Business was not even consulted properly. In a recent written answer, the Government admitted that only 111 companies—111 throughout Britain—had been involved in the consultation on that policy. Why did Labour create those laws with such little consideration for the risk-takers whom they affect?

With all that legislation rolling over from the previous Government, we surely need a pause—a break—in employment law. The coalition is doing many positive things to create the conditions for growth, such as scrapping Labour’s jobs tax, introducing the national insurance holiday for businesses in Yorkshire and outside the south-east, and cutting corporation tax, but at a time when we need to let business focus on growth, the coalition is pushing forward with more legislation on employment law.

First, there is the removal of the default retirement age, with no offsetting measures to assist companies in managing out their staff.

[Anne Marie Morris (Newton Abbot) (Con)]

My hon. Friend is absolutely right that the default retirement age removal is causing problems. In my constituency, many businesses, including Centrax, a very large employer, have come to me and said, “The challenge is that it will be harder to negotiate different packages for older workers.” The budget for recruiting new young people will inevitably shrink, too, and businesses will incur legal costs when they have to justify a default retirement age for a particular job.

[Julian Smith]

My hon. Friend makes a very important point, and I have heard of similar examples. I spoke to the representatives of a local business last week, and they were frustrated because their poorly performing older manager, whom they assumed would retire next year, is digging in—potentially for life—following the announcement of this law.

Then there is the commitment to flexible working rights for all employees, and the sharing of parental leave for mothers and fathers. Consultation on those measures is about to start.

Finally, the Government are considering whether to include small and medium-sized businesses in Labour’s right-to-request-training laws, or repeal the law altogether. That law will create the crazy situation in which, even though most companies cover training in their employee appraisals, employees will have the right to disregard the appraisal discussion and ask for a separate discussion on training. At a time when British businesses are being encouraged to create more jobs than ever, they will have to deal with the hefty employment legislation of the previous Government and several chunky pieces of legislation from the coalition, taking up the valuable time that they could be spending on creating more jobs and more wealth.

I have asked for this debate to urge the Minister to look again at these issues in light of the Government’s forthcoming growth White Paper and the urgent need that we have for jobs in our country today. I am keen to receive from the Minister answers to a number of fairly detailed questions. First, what steps are the Government taking on their pledge in the coalition agreement to review employment and workplace laws for employers and employees? The decisions so far seem to have been employee-led. Secondly, why was the decision made to introduce additional paternity leave provided by the previous Government given that the coalition plans to consult and then introduce its own shared parental leave in this Parliament? Thirdly, when will the Minister confirm whether small and medium-sized enterprises are going to be exempted permanently from Labour’s right-to-request-training legislation, and is he considering full repeal? Fourthly, why was the decision made to introduce flexible working for parents of children up to age 17 given that the Government are planning to offer flexible working to all employees during this Parliament?

Fifthly, I understand that the Institute of Directors has presented a case to the Minister saying that 90 to 95% of private sector companies would be exempted from the scope of the agency workers directive if the Government followed advice provided to the IOD by a senior member of the European Commission. Why have not the Government taken this dispensation? Will the Minister publish any advice that he has received that contradicts that received by the IOD? As Britain will now no longer have a default retirement age, unlike many other European countries, what steps is the Minister taking to ensure that this does not result in a less competitive employment environment in Britain, and what offsetting measures is he considering to develop other mechanisms by which companies can manage out staff?

I apologise to the Minister for such a long list of questions, but I passionately believe that we need to address these issues. With limited fiscal levers to attract business in the UK, we can use competitive employment law to attract the growth that we need. I urge the Minister to lead the charge in playing his role in the Government’s growth White Paper. He should commit today to a holiday from new employment law in 2011, pausing his plans for the sake of jobs. I also urge him to give British business light at the end of the tunnel by strengthening the Government’s commitment to a thorough review of employment legislation and engaging all parts of business, and lots of businesses, in that review—they will be happy to help. We should consult companies of all shapes and sizes from all parts of the country. I am particularly able to supply some frank Yorkshire business people to engage in that process.

During the review, we need to ask some tough questions. For small businesses, what have been the cumulative effects of all these employment laws? How do we make it easier for small businesses to hire and to fire? How do we ensure that the “doers and grafters” of whom the Prime Minister spoke in his conference speech are freed up to take on staff? For larger companies, what is the impact of our employment regime on their costs? How do we ensure that we are truly competitive with other locations for global business? How negative are the effects of our employment law regime on attracting foreign investment?

A holiday from new employment law in 2011 should take pride of place in the Government’s growth White Paper. I would be grateful for the Minister’s support in my campaign to make this happen. Along with the other positive enterprise proposals from the coalition, grasping the employment law nettle will be a big boost for growth.