Enterprise and Regulatory Reform Bill

Baroness Turner of Camden Excerpts

Monday 10th December 2012 Grand Committee

[Lord Young of Norwood Green]

My Lords, Amendments 20MA and 20MB are intended to probe the definition of aggravating features—I fear that this will be an aggravating speech in that respect—and to highlight what is perhaps the key to all of this, which is the proper training of managers in grievance and disciplinary procedure, and even in training, I think. I say that genuinely, because it is a subject that I have brought up time and again in these debates. If the Government could only focus more on that than on the firing of employees, they would do industry a much bigger favour.

Amendments 20MA and 20MB would include in the definition of aggravating features consideration of whether an employer has established any grievance or disciplinary procedure and has provided adequate training to its managers in following those procedures. Underlying much of the Government’s changes to employment rights in the Bill and elsewhere is the idea promoted by Adrian Beecroft, among others, that the most urgent problem facing employers is not being able to get rid of underperforming workers and that by stripping away employment rights, we will have a more productive workforce, creating more jobs.

I could not help noticing the reaction of a medium-sized employer in the north, a removals company, to the Chancellor’s Autumn Budget Statement. It welcomed the fact that there would not be an increase in fuel duty because that would enable it to take on more employees, some of whom would be on zero-hours contracts. I did not hear the caveat, “We would have taken them on, but we will not be able to fire them in future, so we won’t”. That shows me what is really focusing employers’ minds in whether they hire more employees. After all, we are told that that is the Government’s driving motive behind the Bill.

We believe that stripping away employment rights is fundamentally misconceived and stems from a real lack of understanding of how the law works in practice. Contrary to what the Government claim, it is not difficult to dismiss an employee, but the employer must follow the proper disciplinary procedure. Time and again you will hear that that has not happened. Employers have inadequate or, in some cases, no disciplinary procedures in place. It is then that they are rightly challenged by the employee.

Including it as a consideration in whether to levy an additional financial penalty would send a strong signal to employers that it is unacceptable not to make adequate provision for a formal disciplinary or grievance procedure and for the training of their managers. As well as incentivising proper training and procedure, which would, we hope, lead to fewer claims being brought in the first place, the listing of possible considerations under the definition of aggravating features in the amendments would also provide greater clarity about what actions by an employer might result in a financial penalty under Clause 14.

The Explanatory Notes state:

“Section 12A does not prescribe the features which employment tribunals should take into consideration when determining whether a breach had aggravating features; this is for the employment tribunal to decide”;

and that, furthermore:

“The concept of aggravating features in section 12A is not the same as the existing regime of aggravated damages in discrimination claims in England and Wales”.

To my knowledge, the Government have not set out anywhere a list of features which might be deemed aggravating by the tribunal. We urge the Government to provide further clarity on that issue. I beg to move.

[Baroness Turner of Camden]

My Lords, I hope that the Government will see fit to accept the amendment, because I should have thought that it was in their interests. One of the aspects that comes out from discussion of the Bill is that the Government are anxious to stop people going to tribunals. Of course, if you have managers properly trained and a series of agreed procedures, it is far more likely that issues will be settled in-house, so to speak, rather than having to go to a tribunal in the first place. Therefore, it seems very much in the interests of the Government to accept this wording, which talks about the aggravating circumstances but also, I hope, will act as an incentive to employers to make sure that their managers are trained. If you have a trained management, you are much less likely to have an issue that needs to be taken to a tribunal. As we know from our previous discussions, the Government are endeavouring to limit the number of issues that get to a tribunal. I should have thought that acceptance of the amendment was in line with that policy.

--- Later in debate ---

[Lord Marland]

My Lords, government Amendment 21 aims to ensure that the right people are covered by the whistleblowing protections and amends the definition of “worker” in Section 43K of the Employment Rights Act 1996.

Following National Health Service reforms, certain health professionals have been inadvertently excluded from whistleblowing protections as their contractual agreements are not covered by the existing definition of “worker” in the legislation. We believe that it is important that this situation is rectified, so we are amending the definition of “worker” to cover these individuals. We are also taking a power to ensure that future amendments to the definition of “worker” can be made through secondary legislation. This will provide us with the flexibility to react promptly to ensure that the right individuals are protected.

I trust that noble Lords will support this move which remedies an inadvertent omission and ensures that health workers are properly protected. I beg to move.

[Baroness Turner of Camden]

My Lords, I understand from the Government’s statement and from what the Minister has said that the intention is to ensure that people who ought to be covered by the Act in future will in fact be covered. What bothers me about it, however, is Clause 4, which gives the Secretary of State the right to make amendments as to what individuals count as workers for the purpose of this part. It seems to me that that leaves the whole thing fairly wide open as far as the Government are concerned: they would be able to introduce secondary legislation to indicate that some people are workers and other people are not workers. That is a bit of a difficulty as far as we are concerned.

As far as the clause itself is concerned, it had been my intention to move that it should be opposed, mainly because the TUC’s view is that the wording as it now exists in the Bill introduces a public interest test into whistleblowing rights and, for such claims to succeed, the employee will have to demonstrate that he believed that disclosure was in the public interest and that this belief was reasonable in the circumstances. The view of the TUC was that this would limit the protection that employees have in raising concerns about health and safety issues at work. The Law Society also has doubts about this clause. For these reasons I intended to oppose the clause. However, my noble friends have further amendments which we are due to discuss and which I think will deal with some of the problems that some of us have with this clause.

Of course, I am sure that the Minister will appreciate that it is very important to ensure that workers, particularly those working in very dangerous environments, do not have any restrictions about whether or not they may raise problems they have about health and safety at work. I can remember my own union being very much involved with this many years ago when there was the awful accident at Piper Alpha in the offshore oil industry, in which a number of workers were killed. We discovered on investigation that a number of individuals working there had short-term contracts and, because they had short-term contracts, they were very reluctant to warn about the kind of issues that were of concern to them about safety and so on because they feared that they would not have their short-term contracts renewed.

There is a case for looking at the way that this clause in the present legislation works to ensure that we do cover everybody who might have the possibility of drawing attention to possible dangers in their working environment. We must be absolutely certain that they are not prevented in any way from raising those particular issues. I will not, this evening, be pressing the opposition to the whole clause, but I certainly think that we need to look at it very thoroughly before the legislation leaves us.

[Lord Stevenson of Balmacara]

My Lords, in the margins of the debate that we have just had the Minister very kindly passed across the original quote from the 11 May 1998 House of Lords Second Reading debate on the then Public Interest Disclosure Bill. I had to read it very quickly because I was not as well briefed as perhaps I should have been when coming to this debate. I want to make a point that I think influences the way that we might need to respond to the clause-stand-part part of the discussion that we are having today.

The interesting thing about this debate is that we are focusing on the words “the public interest”. I suggest to the Minister that it might be sensible to have a discussion about what the Government are trying to do here. Rather than in the openness of this debate, perhaps we could have a side meeting on it. The reason I am saying that is that, reading the speech of the noble Lord, Lord Borrie, one might think that if he made it up as he went along, it was extremely well written. I imagine that he read it out at the time from a brief that he had. The important thing about it—I am sure that the Minister will have been on to this immediately—is that the Minister was selective in what he quoted to us. The noble Lord, Lord Borrie, said that,

“the tribunal must be satisfied that that disclosure was reasonable, having regard, among other things, to the seriousness of the threat to the public interest, whether the danger is continuing or likely to occur again, whether the disclosure was in breach of an obligation of confidentiality owed to a third party and, where appropriate, whether use was made of any whistle-blowing procedure which the organisation had in place”.—[Official Report, 11/5/98; col. 891.]

The noble Lord then went on to make the quote to which the Minister referred.

The point that I want to underline is that the tribunal has to be satisfied that disclosure was reasonable: that is the founding principle of this part of the legislation. “Having regard to” is a secondary feature of that in relation to the seriousness of the threat to the public interest. It seems to me that this amendment substitutes the present arrangements for the reasonableness —having regard to other things—of the seriousness of the threat to the public interest, to a direct concern for “the public interest”, however we define that. It seems to me that in making that rather elegant elision we are in danger of opening a much wider range of issues that need more thought than we can possibly give it in this Committee, which is why I suggest that we have a meeting.

The Minister says that this is ongoing work—we welcome that. He says that it is important—we certainly echo that. He is also asserting, and we would agree with this, that we are singing off the same hymn sheet. So we are surely trying to get to the same place here. I do not think that there is a difference of approach: I just worry that the wording is not as you would do it.

The complexity of this issue is that, as the noble Baroness said very clearly, we all want those who should be covered to be covered by this part of the legislation, but we do not want to have the risk that those who could be covered are not covered by it. I think that that is a really important point. It is in that sense that we would ask the Minister to respond to this and, perhaps, to take up our suggestion of a side meeting.

--- Later in debate ---

Moved by

[Baroness Turner of Camden]

24: Clause 16, page 12, line 15, at end insert—
“(aa) where the claimant, on the advice of the Judge, withdraws a part or the whole of the claim, any deposit shall be repaid”

[Baroness Turner of Camden]

My Lords, this is a fairly simple and straightforward issue. Currently, when a judge decides that a claim has little reasonable prospect of success he can order a claimant to pay a deposit of up to £1,000 as a condition of their claim proceeding. However, judges can issue dispute orders only when they consider that an entire claim is weak. Clause 16 would enable judges to impose a deposit where they consider that just part of a claim is weak. However, the TUC, to which I am indebted for this briefing, believes that employment tribunals already have sufficient powers to deter weak and vexatious claims, and therefore that this measure is not necessary. The introduction of fees would mean that claimants would be required to pay significant sums in order to access an employment tribunal.

Rather than increasing the use of deposit orders, the Government should provide that where a claimant decides to withdraw a claim, or part of a claim, on the advice of judges, then the relevant fee that the man or woman has already paid should be returned. That seems quite fair to me and I hope, therefore, that the Government will be prepared to agree to this simple measure. If the claimant has already paid a deposit, takes the advice of a judge and withdraws, he should get his money back. That is quite a straightforward proposal and I hope the Minister will be prepared to accept it.

--- Later in debate ---

[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.

[Baroness Turner of Camden]

I thank everyone who contributed to this small debate. Of course, it is not about discrimination at all. It is quite irrelevant to introduce discrimination in a debate on an amendment which simply says that, if someone pays the deposit and does not proceed with the case because they accept the advice of a judge, they ought to get their money back. It is as simple as that. It has nothing to do with discrimination at all. I see that the noble Earl accepts that.

[The Earl of Glasgow]

I apologise for bringing it up. I tried two or three times to think of a place where I could bring it in as I thought it was important to do so. As we are getting to the end of the tribunal issues, I thought it was the only place where I could do it. I apologise.

[Baroness Turner of Camden]

Certainly. As my noble friend said, if we want to have a discussion about discrimination, there will be the opportunity to do so during the passage of the Bill, in which case we would want to prepare for it and ensure that the views of this side of the House were properly considered. The amendment is not about discrimination, as I think the Minister accepts. I am interested to hear what he has to say and I shall of course read it with great interest. In the mean time, I beg leave to withdraw the amendment.

Amendment 24 withdrawn.