Health and Safety at Work etc. Act 1974 (General Duties of Self-Employed Persons) (Prescribed Undertakings) Regulations 2015

Baroness Altmann Excerpts

Wednesday 22nd July 2015 Lords Chamber

Moved by

[Baroness Altmann]

That the draft regulations laid before the House on 22 June be approved.

Relevant document: 1st Report from the Joint Committee on Statutory Instruments

[The Minister of State, Department for Work and Pensions (Baroness Altmann) (Con)]

Section 1 of the Deregulation Act 2015 gives the Secretary of State the power to make regulations, which limit the scope of Section 3(2) of the Health and Safety at Work etc. Act 1974 so that only those self-employed who conduct an undertaking of a prescribed description will continue to have a duty under the provision.

The regulations set out ways in which undertakings may be prescribed. The regulations will retain duties on all self-employed persons who conduct specified high-risk work activities or may expose others to risks to their health or safety. I am satisfied that the instrument is compatible with the European Convention on Human Rights.

It is important that I set out a little of the background to the draft regulations. In 2011, the Government commissioned Professor Löfstedt, director of King’s Centre for Risk Management at King’s College London, to conduct an independent review of health and safety regulations. One of his recommendations was to exempt from health and safety law those self-employed people whose work activities pose no potential risk of harm to others. The Government accepted this recommendation and asked the Health and Safety Executive to draw up proposals for changing the law.

Currently, Section 3(2) of the Health and Safety at Work etc. Act 1974 imposes a general duty on self-employed people to protect themselves and others from risks to their health and safety, regardless of the type of activity they are undertaking. The proposed change to the law was included in Clause 1 of the then Deregulation Bill to ensure that only those self-employed who conduct an,

“undertaking of a prescribed description”,

will continue to have a duty. The underlying policy is that self-employed people will retain duties under Section 3(2) only if their undertaking involves carrying out an activity which is specified within the regulations. It was intended that the regulations would consist of a short concise list of activities. The proposed policy was subject to two public consultations and was debated in Parliament. The Government carefully considered the consultation responses and listened to respondents’ concerns during the debates in both Houses. The clause was therefore amended at Report in the House of Lords to ensure that those self-employed people whose work poses a risk to the health and safety of others remain subject to the law. It is these amended regulations that are subject to scrutiny by both Houses of Parliament.

The Bill received Royal Assent on 26 March 2015. The regulations have been drafted to ensure that self-employed people still have a duty under the law when they carry out high-risk activities that create risks for themselves or others. This is intended to include the most common activities carried out by the self-employed and those which statistically result in high numbers of fatalities or injuries. This approach puts beyond doubt that these self-employed people will not be exempt from health and safety law, irrespective of what they do.

Work activities in agriculture, on the railways or involving gas and asbestos are included. In addition, the regulations also include any EU requirements that impose a specific duty on someone who is self-employed to protect themselves from risks to their own health and safety. This brings in work with genetically modified organisms and self-employed people who work on construction sites. This is the key part. There is a catch-all provision in the regulations so that self-employed people who carry out an undertaking which may expose others to risks to their health and safety are included. We are exempting only those self-employed people who do not pose a risk to the public and who are not going to sue themselves.

The Government acknowledge that the self-employed will need some help to understand this change and to limit the possibility of incorrectly assessing whether their work activities may expose others to risk. The Health and Safety Executive will therefore produce guidance to support the regulations. This will also signpost existing guidance which explains in practical terms what they need to do to comply with health and safety legislation.

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[Baroness Altmann]

I thank noble Lords for their comments, and I thank the noble Baroness, Lady Donaghy, and the noble Lord, Lord McKenzie, for their, albeit reluctant, welcoming of the proposals.

I want to provide some clarifications that were asked for by the noble Lord. The obligations of the self-employed to others are unaffected. Their obligations to employees are unaffected and Section 3(1) and (2) will still apply.

I also make it clear that the exemptions will be clarified in specific, detailed guidance from the Health and Safety Executive. The definition of self-employed that the noble Lord, Lord McKenzie, asked me about is in Section 53 of the Health and Safety at Work etc. Act and is rather broad, stating that,

“‘self-employed person’ means an individual who works for gain or reward otherwise than under a contract of employment, whether or not he himself employs others”.

A director of a limited company is an employee of that company. If that company employs others—that is, is an employer—it will have duties under Section 2 of the Health and Safety at Work etc. Act towards its employees.

I take my noble friend Lord Cormack’s point about the term “probabilistic”, which seems to have been more ballistic today than one might have expected, and I will relay his request to the department. As far as banning acronyms is concerned, as someone who is steeped in pensions, these have often been the bane of my life and I sympathise to some degree.

I share the concerns of the noble Lord, Lord Kennedy, about the agriculture industry. It is indeed an industry, as is construction, in which there have been an enormous number of accidents and fatalities. The duties on the self-employed to report accidents are not affected in any way by these changes but it is anticipated that they will remove 1.7 million people from the scope of Section 3(2) of the Health and Safety and Work etc. Act 1974 and will result in savings to the self-employed of £4.7 million over 10 years. Obviously, the source of those savings is subject to estimation but it appears that a number of self-employed people who do not pose any risk to others, such as a bookkeeper working from their own home and not coming into contact with anybody else, mistakenly believe that they are required to carry out health and safety assessments or are approached by consultants who lead them to believe that they need to spend money on having such an assessment. I entirely agree with the noble Lord that as long as the guidance is clear and the clarifications are available—so that people who are exempt know they are exempt, and those who could pose a risk to the public and are therefore not exempt will be able to identify themselves—this should indeed result in savings, as recommended by the Löfstedt report.

We have had an independent review. We have listened to the concerns and the requests for amendments that have been made, particularly by the noble Lord, Lord McKenzie, and have responded to those. The catch-all phrase in Regulation 2(b) should make it absolutely clear that we are intending to cover anybody who potentially poses a risk to the public, and they will still have to comply with health and safety regulations.

[Lord McKenzie of Luton]

The Minister referred to the 1.7 million people who will be taken outside the scope of the Health and Safety at Work etc. Act. What estimate has been made of the number of those people who would have to undertake a risk assessment in the first place to determine whether or not they pose a risk to others?

[Baroness Altmann]

We would expect that if they are exempt they would not need to undertake a health and safety risk assessment. The idea is that it will be made clear to them if they are working in such conditions that they pose no threat to the public. As I described, if you work from your own home and you do not come in contact with the public, you will not need to do a health and safety self-assessment, and somebody will not come along and say, “Oh, by the way, everybody has to conduct a health and safety assessment”. However, of course, if you are employing other people, that will still be required. I hope that that answers the question.

I understand that it is difficult to imagine how this will work until it is actually working, but the guidelines and the guidance will be available six weeks before the regulations come into force. There will be an extensive campaign to publicise this change and to explain it to the public. Our estimates have been made and we are accepting the recommendations of an independent review. We are talking only about someone who is self-employed so our expectation is that this will save both time and money; it will also save those self-employed people who are now exempt from having to keep up to date with any changes in health and safety regulation, which in itself can take time or cost money.

We are aiming to help businesses. We expect that more new businesses will start up as a result of this. Again, one cannot demonstrate precisely how many—

[Lord McKenzie of Luton]

I am sorry; I promise not to interrupt again. Is the Minister seriously saying that an estimated 15 minutes a year has been prohibiting self-employed businesses from starting up and flourishing; or that the minuscule savings that, in aggregate, even on these estimates, are expected to accrue will affect the growth of self-employed businesses? There have been some 200,000 new businesses in recent times in any event. They do not seem to have been inhibited by overburdensome health and safety regulations.

[Baroness Altmann]

I accept that it is impossible to prove but that is the expectation of the department. At the margin—these decisions are often important at the margin—some people will be reassured to know, if they are intending to set up only as a self-employed person working from home, that they are not included in the health and safety requirements they are now being exempted from. It is impossible to say, as with all such things, but we certainly have been advised that, and it is the view of the independent reviewer that, this will make a difference. Therefore, we are recommending these changes.

[Lord McKenzie of Luton]

I said that I would not intervene again, but I want to stress to the Minister that the statement made that those working at home can be outside the Health and Safety at Work etc. Act is very dangerous. To make blanket assertions in such a bold way—that no one in that situation will pose a risk of harm to others or need to undertake a risk assessment—is highly dangerous. I apologise for interrupting. I will not do it again but we have to stress the importance of not going down that path of encouraging people to think that they are outside the provisions of this very important legislation.

[Baroness Altmann]

I absolutely share the noble Lord’s view that this is very important legislation. The advances we have made in health and safety and the consequent reductions in accidents, along with the measures introduced all those years ago, are a significant achievement and success. However, I am suggesting that certain businesses can be exempted from this provision because they pose no risk to the public. I certainly would not wish to give the impression, and I hope I have not, that everybody who works from home is exempt. One million self-employed people will still be covered by the regulations. They will apply only to certain types of activity and they will be made clear. They will be clarified by the guidance and by the campaign that will be launched six weeks before these measures come into effect.

[Lord Hodgson of Astley Abbotts (Con)]

Perhaps my noble friend might like to explain to the noble Lord, Lord McKenzie, and the party opposite that what is actually needed here is common sense, not risk assessment. Risk assessment is a formal legal process. People should use their common sense to make sure that they look after themselves. I think that is what my noble friend is trying to drive at and it must be the right way to proceed—to avoid paper form-filling and unnecessary diversion of effort for people who, with common sense, could work it out for themselves.

[Lord McKenzie of Luton]

But is risk assessment not a matter of common sense?

[Baroness Altmann]

I thank my noble friend Lord Hodgson for his comments. I would certainly be of the view that in the cases one could imagine these regulations applying to, it would be common sense to identify whether you pose no risk to the public in the work you are doing. You would therefore not need to carry out a health and safety assessment on yourself or your place of work if you do not pose any risk to anybody else. As I have said, a self-employed person who is an employer will continue to have duties under the Act; so will anyone who carries out high-risk activities.

[Lord Kennedy of Southwark]

I made reference to the problems in the agriculture industry, which is the most dangerous in which to work in the whole of the UK. I am certainly of the opinion that either the regulations are not strong enough at present or they are not enforced properly. Will the noble Baroness look at the list of injuries—drownings and electrocutions? It is a shocking tale in that industry and something really needs to be done about it.

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[Baroness Altmann]

I certainly agree with the noble Lord, Lord Kennedy, about agriculture, which is a prescribed activity. All self-employed persons undertaking agricultural activities will continue to have duties under Section 3(2) of the health and safety Act. Indeed, if the noble Lord so requests, we will be happy to look at the situation with agriculture. We certainly recognise the importance of keeping agriculture within the remit.

I beg to move that the House has considered these regulations.

Motion agreed.