Draft Code of Practice on Reasonable Steps to be taken by a Trade Union (Minimum Service Levels)

Debate between Chris Stephens and Justin Madders

Monday 27th November 2023 General Committees

[Justin Madders]

My hon. Friend is absolutely right that the code puts the onus on trade unions. How odd is it that we are in a world in which a Government instruct a trade union to tell employees to attend the workplace? I cannot think of anything more bizarre. But the measure is not actually about ensuring that people attend work; it is about undermining collective industrial action. From what we have seen today, it is clear that that is exactly the Government’s intention.

The trade union’s duty to take reasonable steps to contact members as soon as is “reasonably practical”, contained in paragraph 19, is contradicted in step 2 of the code, which provides guidance on how to encourage members to comply with a work notice. In this step, the code states that once a union has identified all its members, it should communicate this to them via a compliance notice. Paragraph 23 states that the union

“should send the compliance notice before the strike action”

but that it would be “reasonable” to send the notice

“once it is clear that the work notice will not be subject to variation by the employer—either because the last day on which the employer can vary the work notice without the union’s agreement has passed or because the employer has notified the union in writing that it will not vary the work notice”.

That is completely inconsistent with what the code of practice states earlier—that the union should contact its members as soon as is “reasonably practical”. They cannot both be right. Given the consequences of getting this wrong for both the trade union and the individual, the code of practice really ought not to contain such a mixed message. Will the Minister therefore confirm whether a union is supposed to wait until the conditions in paragraph 23 are met, or just get on with it as soon as is “reasonably practical”, as paragraph 19 suggests?

Beyond that issue, the code’s recommendations on encouraging members to comply with a work notice are plainly unreasonable, misleading and complex. Step 2 of the code contains stipulations that are drafted in such a way that grounds for legal challenge will inevitably be opened. Paragraph 26 and annex A, in particular, can be seen to do this. Paragraph 26 includes a list of eight features that a compliance notice must state “clearly and conspicuously”, and annex A contains a pro forma template for unions to use, which is recommended for use by unions at paragraph 27. Paragraph 27 states that a union can amend the template but that the compliance notice must retain

“the overall substance and effect of the notice”.

So why go down this road at all? Why go to the trouble of drafting a template letter and then say that unions can vary it? Is that not just inviting trouble?

We know that the slightest transgression in an industrial action ballot can lead some employers to seek injunctions, even though the practical effect of that transgression is nil, so there is a concern that any deviations from the template will invite legal challenge from employers. The TUC believes that deviations

“will almost certainly lead some employers to seek to legally challenge unions”.

Does the Minister agree with that point of view? How does he think that such satellite litigation will aid the resolution of industrial disputes? Can he also explain the rationale for including a pro forma template on top of the guidance contained in paragraph 26?

Unfortunately, that is not the only way in which the code could instigate legal challenge. Plenty of areas in the code appear to allow for challenges if the union makes an error. Paragraph 39, for instance, states:

“communicating with members whom the union knows are identified in a work notice to induce them to strike”

could constitute an act that undermines steps taken to comply with a work notice. Taken literally, that means that for the period of the work notice, the trade union cannot contact any member subject to one at all with any information on the industrial action. Is the Minister saying that on certain occasions, for a certain period, a trade union cannot contact some members to tell them what is happening with the strike? The mere mention that a strike is taking place could be considered an inducement to strike. I am interested to hear what the Minister says about that, because to me it looks like a fundamental attack on democratic freedoms.

If the Minister does not accept that that is the intention behind paragraph 39, does he accept that there could be a real problem in some circumstances—for example, where there is a technological or administrative error in distributing emails on a mailing list that could risk some of the wrong members receiving that email? Trade unions in those circumstances would lose their protection from liability in tort and employees would lose their automatic protection from unfair dismissal. Is that really what is intended with the code of practice, because that is what paragraph 39 seems to suggest?

The stakes are far too high for such an error to constitute a breach of the code, especially given that the names included in the work notice are liable to change, often at short notice. As there is already guidance in the code stating that compliance notices should include statements telling those on work notices to ignore calls to take part in strikes, paragraphs 38 to 40 seem excessively punitive and unnecessary. The only conclusion that one can draw from such a communication—a blackout around strikes—is that this is a deliberate attempt to undermine trade unions and impact the effectiveness of industrial action.

I will return briefly to the annex and paragraph 26; this is an example of the state trying to dictate the contents of a union’s communications with its members. First, according to the stipulation in paragraph 26(f), unions are expected to encourage workers to undertake the work set out in the work notices. We think it is inappropriate for a union to encourage a worker to comply with a work notice, as it could undermine the collective endeavour of industrial action. Yes, a union must advise a worker of the possible consequences of failing to comply with a work notice, but it is not the role of the state to instruct a union to do that in an enthusiastic way, as is implied in the code of practice.

What does “encourage” even mean? Is it like a football supporter encouraging their team from the terraces and cheering the team on? Is it sending text messages to a mobile phone with affirming messages such as “Please go to work today. I know you’ve got this”? It seems a very odd thing to request that a trade union encourage its members to go to work, given that presumably on every other day, the employee does not require such encouragement to turn up and do their job.

[Chris Stephens]

Is there not another concern that trade unions have flagged up? Trade union representatives will be identified in the work notices, so the trade union representative will be the one who is picked to, effectively, bust their own industrial action.

[Justin Madders]

Yes, I will get on to that—there is a bit more, I am afraid, Ms Nokes, because there is an awful lot to talk about. The measure fundamentally pits trade unionists against their core beliefs and principles. That does not seem to register with Government Members, but it really is doing that.

The requirement to encourage members to turn up for work is an odd thing to request, given the failure to explain the legal issues with the necessary accuracy in paragraph 26, which states that unions are advised to tell members that they should receive from the employer

“a statement that the member is an identified worker…and must comply with the…notice given to the union.”

But there is no obligation under the Act for an employer to communicate with workers named by the work notice. Employers need do so only if they want to keep open the option for dismissing them for not attending work. If not, they can let the trade union do all the work.

The code also states that the compliance notice should contain a comment stating that two notices should be received from the employer and that if the member receives both, they

“must carry out the work during the strike or could be subject to disciplinary proceedings which could include dismissal”.

However, the Act gives neither the employer nor the Government the power to compel people to attend work. What it actually does is state that a worker who has been notified by the employer that they are named in the work notice may be dismissed and denied the automatic right to protection from unfair dismissal for taking part in the strike. The code does not highlight that a worker who was dismissed might still be able to bring an unfair dismissal complaint under the general law.

The code and template letter are therefore misleading. But why do they have any reference to dismissal at all? The template requires the union to warn a member that

“you could also be dismissed as a result”

of not following the work notice. However, that is not what the Minister told us would happen. When he was at the Dispatch Box on Monday 22 May 2023, he said:

“The reality is that nobody will be sacked as a result of the legislation.”—[Official Report, 22 May 2023; Vol. 733, c. 103.]

If that still stands, why does the code of practice require unions to warn people of something that is not going to happen? Why would the Minister ask unions to write to their members about something that he said at the Dispatch Box would not happen? I invite him to withdraw his comments or, ideally, withdraw the whole draft code.

The compliance notice template in annex A states:

“The work required of you should be work which you normally do or work which you are capable of doing and is within your contract of employment.”

Can the Minister tell us whether the notice remains effective if it requires someone to undertake a role with which they are not familiar? After all, many contracts of employment have a catch-all clause requiring employees to undertake whatever duties their employer sees fit. At the very least, there ought to be some guidance on what the employee should do if they face such a request. That point also raises the question of what happens if a non-union member is included in a work notice, but the employer fails to contact them. Would they be subject to disciplinary procedures as well? Both those examples show how far the code is from providing certainty; it just adds more complexity and confusion.

The code of practice’s guidance on picketing is an element that came as a surprise, as there was no mention of it at all in the Act. It is covered by different legislation and a different code of practice. There was next to no discussion of picketing when the Bill passed through Parliament, so its inclusion in the code of practice is another example of the way in which this Government have sidestepped scrutiny at every opportunity. I see no legitimate reason for its inclusion; it seems that it is an attempt to expand the scope of the legislation via the back door. That is at complete odds with the purpose of a code of practice that is supposed to put flesh on the bones of how an Act works, not to expand its reach.

Step 3 of the code is simply titled “Picketing”. It sets standards on the union to instruct picket supervisors. Paragraph 33 states that

“the union should…use reasonable endeavours to ensure that picketers avoid, so far as reasonably practicable, trying to persuade members who are identified on the work notice not to cross the picket line at times when they are required by the work notice to work.”

The irony of a code of practice explaining what is meant by the term “reasonable steps” by using the phrase “reasonable endeavours” is certainly not lost on me. It is not exactly a great leap forward, is it? Using “reasonable endeavours” not to do something is a novel concept: it is usually a concept applicable where there are positive obligations on someone to act. I struggle to see how that translates into a negative obligation.

Certainly, nothing that I have heard today explains what that means in practice. But that is the point, isn’t it? This and many other areas in the code of practice leave important questions open to interpretation by the courts. It will take a case making its way to court, and probably several levels of appeal, before it becomes clear what “reasonable endeavours” a union must actually take to prevent members persuading those on a work notice not to cross a picket line. The weight of the punishments that the union and its workforce could be forced to pay will doubtless mean that unions will be cautious about how this works in practice.

This is a legal nonsense. It is quite blatantly a tactic from the Government to attack a union’s right to strike by blunting some of its most effective tools. However, it is a tactic that will add to court backlogs, as we have heard, and will cost the taxpayer, unions and businesses large sums of money when all these issues end up being litigated. Ultimately, it will do absolutely nothing to improve industrial relations in this country.

I will return to the crux of the extract from which I quoted: that picketers should not try to persuade workers listed in a work notice to join them on strike. It is clearly drafted to completely undermine the role of a picket, to the extent that it will be unworkable and difficult to enforce. How is a picket supervisor supposed to know who is on a work notice, especially if the notice runs to hundreds or even thousands of people? Are they expected to know them by appearance? Unless they are told otherwise, picketers are therefore going to have no idea who is bound by the work notice and who is not.

It is completely unclear how the picket supervisors, who are expected to execute this duty and enforce this measure, will be able to do so in practice. The aim of the picket is to encourage compliance with the strike, but the picket supervisor is expected to undertake duties well beyond ensuring that a worker named in a work notice simply is not hindered in going into work. It is another fundamental attack on the role of trade unions. Does the Minister understand that he is asking trade unions to turn on their core beliefs and jettison the very essence of what they stand for?

It is also unclear whether the Government have considered the case of Ezelin v. France, as the TUC’s submissions recommend. In that case, the European Court of Human Rights found that requiring a lawyer to disassociate himself from a demonstration infringed his rights under article 11 of the European convention on human rights? A response on that issue from the Minister, either in his closing speech or in writing after today’s proceedings, would be appreciated.

Other hon. Members wish to speak, so I will draw to a conclusion. We are being asked to vote on a code of practice that goes far beyond the legislation that it is meant to explain. It places potentially insurmountable burdens on unions, leaves important legal questions unanswered, requires unions to be the mouthpiece of the state and expects unions to enforce a draconian piece of legislation that goes against the very essence of their values. To top it all off, there is the threat, should unions not follow the guidance to the letter, of having to pay out exorbitant costs through proceedings in tort and of leaving all their striking workers vulnerable to being sacked.

It is clear what the code of practice seeks to achieve. As we said of the Act throughout its passage, it is an attack on trade unions and their members, and it undermines the fundamental right to strike. We cannot vote for it. No one who believes in freedom of association can vote for it in good conscience. The Government need to go back to the drawing board and redraft the code of practice—or, better still, get rid of the Act altogether.

Strikes (Minimum Service Levels) Bill

Debate between Chris Stephens and Justin Madders

Consideration of Lords message
Wednesday 21st June 2023 Commons Chamber

[Chris Stephens]

The shadow Minister is being very generous in taking interventions. The heart of the Lords amendment is to protect workers who have been dismissed so that they have recourse to a tribunal. That is a fundamental human right, is it not?

[Justin Madders]

One would have thought so, and that is probably why the Equality and Human Rights Commission has expressed great alarm at this Bill. If the Government want to give themselves the power to threaten every firefighter, every teaching assistant and every paramedic with the sack when they exercise their democratic right to withhold their labour, they should think very carefully about what they do with that power, because in a free society no Minister should hold that power—not that Ministers seem to understand what this Bill actually does, because the Minister said last time:

“The reality is that nobody will be sacked as a result of this legislation.”—[Official Report, 22 May 2023; Vol. 733, c. 103.]

I know that the Government chose to bypass the normal line-by-line consideration of this Bill, but one would have hoped that the Minister had read as far as the schedule, because it does actually contain the power to sack people for going on strike.

Even if the Government do not understand the powers they are giving themselves under the Bill, they ought to understand the principle of the withdrawal of labour in the event of a dispute. As my hon. Friend the Member for Eltham (Clive Efford) has mentioned, many Conservative Members withdrew their labour the other night. In fact, 200 of them had no difficulty in doing so. Indeed, former Prime Minister Johnson withdrew his labour after he disagreed with the report from the Privileges Committee. So they should understand that the principle of people withdrawing their labour is an important one. It is a basic and fundamental right that every one of our citizens should enjoy in a free and democratic society. We are not serfs required to provide toil to the lord of the manor or conscripts engaged in a war against an invading force; we are citizens of this country, and in a free country the right to withdraw labour should be protected and respected.

Even if Conservative Members believe that the requirement to send someone into work against their will is somehow consistent with a free and democratic society, they should at least consider the fact that the Bill as it stands means an employee can be sacked for failing to comply with a work notice, even if they say they have not received it. Yes, someone can be sacked for not complying with a work notice without any challenge to it legally, and they can also be sacked for not complying with it even if they have never seen it. How is that justice, how is that reasonable and how is that good industrial relations? It is a recipe for injustice, for toxicity and for abuse by employers who want to get rid of the most troublesome employees.

I will not list all the organisations that have condemned this Bill, but two of the main employers in the key rail and health sectors have called this out for what it is, because they know that rather than resolve industrial disputes, this Bill will prolong them. They know that the kind of restrictions this Bill places on people are anti-democratic and not in the best traditions of this country. It is no wonder that even members of the Cabinet have criticised this Bill. Indeed, this week we had the shameful news that the United Nations, through the International Labour Organisation, has called on the Government to respect international law, such is the threat that this Bill poses to it. No, we cannot accept this tawdry, vindictive, unworkable disgrace of a Bill. This Bill attacks the people who keep this country going, and the sooner the Government realise that the politics of division will not work, the better.

Draft Pneumoconiosis etc. (Workers' Compensation) (Payment of Claims) (Amendment) Regulations 2022 Draft Mesothelioma Lump Sum Payments (Conditions and Amounts) (Amendment) Regulations 2022

Debate between Chris Stephens and Justin Madders

Wednesday 23rd February 2022 General Committees

[Justin Madders (Ellesmere Port and Neston) (Lab)]

I believe that this is the first time I have appeared before you in the Chair, Dr Huq, so I will do my best to make sure that it is a memorable occasion for us both.

I thank the Minister for introducing the regulations. As she set out, the mesothelioma regulations amend the Child Maintenance and Other Payments Act 2008 and the pneumoconiosis regulations amend the Pneumoconiosis etc. (Workers’ Compensation) Act 1979. As we heard, both Acts make provision for lump compensation payments to be made to people suffering from specific dust-related diseases or their dependants, provided that they meet the conditions of entitlement. I note that as of 1.30 pm today both statutory instruments had still not been assigned numbers and the explanatory memorandums appeared in draft form on the Government website. I hope that that can be addressed.

As we have heard, today’s regulations uprate the amount of compensation paid to disease sufferers or their dependants by 3.1%. I note that the Government have reviewed the rates to maintain their value in line with inflation, as measured by the September 2021 consumer prices index, and in line with disability benefits. Although we recognise that the Government are under no obligation to do any uprating under either Act, we believe that it is vital to continue to support people affected by these awful diseases and their families and that annual uprating is necessary. Having said that, it is worth noting that, as my right hon. Friend the Member for Leicester South (Jonathan Ashworth) has already stated, uprating in line with inflation last September does not really reflect the true position that we are now in, given that inflation is likely to be around 6% for much of the course of the year according to the Bank of England. The uprating therefore reflects a real-terms cut.

The cost of living crisis has been debated in this place many times already this year and will no doubt be discussed again. As the regulations are not amendable, we cannot substitute the figure of 3.1% for something more akin to reality, but I believe it shows how once again the Government have struggled to recognise the very real financial pressures people face.

As we have heard this afternoon, mesothelioma is an invasive type of cancer caused by prior exposure to asbestos and for which there is currently no cure. It grows in the pleural membrane that lines the outside of the lung and the inside of the chest. Less commonly, it can also affect a similar lining around the abdomen or heart. It can take a long time to develop, as we have heard, with the first symptoms sometimes appearing 30 to 40 years after exposure. Patients experience complex debilitating symptoms and often have a short life expectancy. Of course, that presents real difficulties for those who develop the disease in being able to pursue a legal remedy.

The Health and Safety Executive reports that the UK has the highest rate of mesothelioma in the world and mortality rates have more than quadrupled in the past 30 years, with the disease being more common in certain parts of the country, reflecting the location of industries such as shipbuilding where asbestos was frequently used. Sadly, it is estimated that about 2,500 people die of the disease every year. Over the next 30 years, some 60,000 people will die of mesothelioma in the UK unless new treatments are found.

Pneumoconiosis refers to a group of lung diseases caused by inhaling dust. Common types include asbestosis; coal workers’ pneumoconiosis, caused by breathing in coal mine dust; and silicosis, caused by breathing in respirable silica and typically affecting industries such as quarrying, foundries and potteries. As with mesothelioma, there is a long delay between exposure and the onset of the disease. The Health and Safety Executive estimates that overall 12,000 deaths each year are linked to occupational lung disease.

I pay tribute to organisations such as Mesothelioma UK, the British Lung Foundation and Macmillan Cancer Support, which raise awareness and provide ongoing support for individuals and their families who are affected by these terrible diseases.

We know that before the dangers of asbestos were known it was frequently used for insulation, roofing and flooring in commercial buildings and homes. Indeed, it has been used in this very building and I recall my grandfather telling me how they used to use it as a snowball when he was at work. It was clearly very commonly used and we are still reaping the consequences today, but it was not banned until the Asbestos (Prohibitions) (Amendment) Regulations 1999. That means that buildings constructed up until the turn of the century might still have asbestos in them. Many colleagues will be aware that unfortunately those who worked in industries such as building and construction from the 1970s to the 1990s may still experience the consequences of exposure to asbestos, but those consequences are not limited to people who worked in those industries. For example, the National Education Union found that at least 319 teachers have died from mesothelioma since 1980, 205 of whom died after 2001. That is a staggering statistic and highlights the pervasiveness of asbestos in many of our buildings.

As we have noted, the Government are not under any obligation to uprate the payments, but it is clear that Members have asked on many occasions whether future increases could be made automatically rather than at the discretion of Parliament. One of the Minister’s predecessors agreed to consider that proposal, and I wonder the Minister can update us on that point. We have been told previously that automatic uprating would not be sensible because it would prevent debate, but when the yearly debate consists of very much the same issues being raised again and again, that argument appears a little artificial. Members are more than capable of raising issues in several ways through debates and in other forums. I hope that the Government will address the issue of automatic uprating, because it would not reduce Members’ ability to raise specific issues. It would also send a powerful message that, while no amount of money will compensate for the suffering and loss caused by the diseases, the Government are committed as a matter of course to ensuring that support is provided to those entitled to it.

It would also provide security to those affected if they knew that the uprating would apply each year without fail. That is especially important when those in receipt of payments may already have experienced a long and stressful wait for their assessment and gone through what can sometimes be a challenging and distressing assessment process. Members will be aware from experiences with their constituents that the process is not necessarily adapted to individuals’ needs, and the one size fits all approach can sometimes ignore irrefutable medical evidence. The Minister has set out some of the changes that have been made, but security for individuals from having their payments automatically uprated would be an important step forward, and the least that they deserve.

The hon. Member for Glasgow South West raised the issue of equalisation of lump sum payments to victims’ dependants. According to the Asbestos Victims Support Group Forum, figures from 2019-20 showed that a 77-year-old with mesothelioma would receive £14,334 if they claimed themselves, but if they died before claiming —as we know can happen with such aggressive and difficult to diagnose cancers—their surviving partner or dependant would receive just £7,949, which is just over half. That issue has been raised by Members year after year in these debates.

[Chris Stephens]

I thank the hon. Gentleman, who is my good friend, for raising this important issue. I remind the Committee that the Government committed in 2010 to look at the disparity and to equalise the situation. Twelve years is too long and we need action now.

[Justin Madders]

I thank the hon. Gentleman for his intervention, which highlights the point that we have these debates every year and the same issues continue to be raised. The Government are sympathetic, as indicated by previous commitments, but action is missing. The Minister has said that she will write to the hon. Gentleman after the debate, and I hope that she will share that correspondence with the rest of the Committee, because this is an important issue that needs addressing. It will not go away; we will continue to raise it on an annual basis.

When the Minister responds to this debate, will she comment on a response given to a written question tabled by my hon. Friend the Member for Manchester, Gorton (Afzal Khan) on this matter? He was told:

“It is right that available funding is prioritised where it is needed most, that is to people living with these diseases.”

Will the Minister explain whether she agrees with that assessment; when she will be able to give us a timetable for when any change in the Government’s position on the matter can be expected; and what recent estimates have been made of the cost of providing equal payments to sufferers and their dependants? I feel that that may well be what is behind the inertia on the Government Benches. Furthermore, given that the difference in payments often affects women whose husbands were directly exposed to asbestos, will the Minister tell us whether there has been any equality impact assessments in respect of the lack of parity in payments?

I conclude by urging the Minister to reflect on the issues that hon. Members have raised and to address them, so that we do not have to come back next year and debate them all over again.

Employment Tribunal Fees

Debate between Chris Stephens and Justin Madders

Tuesday 1st December 2015 Westminster Hall

[Justin Madders]

I thank my hon. Friend for his intervention. I will address later some of the disproportionate impacts of the fees, but they are part of a bigger picture: they are part of a sustained attack on working people in this country. A lot of the legislation in the previous Parliament and currently going through the House is nothing more than an attack on basic workplace rights and protections. If our ambition is to have an economy and country where everyone has a stake in their prosperity, we should value the security and sustainability of jobs as much as the means of creating them.

It is widely recognised that losing a job is one of the major occasions in life on which people face extreme pressure and stress. Obviously, it is not quite as significant as some other issues, but for many, it can be a pretty traumatic experience. It can affect a person’s marriage, health, home, finances and, of course, family, yet we seem to be fostering a culture in which an individual is considered a disposable item to be cast aside with barely a second thought. While that culture exists, it is important that we have strong protections in place and—this relates to today’s debate—an effective and accessible system enforcing those protections.

Let us look first at the stark data, which show that the number of tribunal claims lodged has fallen off a cliff since the introduction of fees in July 2013.

[Chris Stephens (Glasgow South West) (SNP)]

I congratulate the hon. Gentleman on securing this important debate. One of the reasons given for the introduction of these fees was to protect hard-working taxpayers from having to contribute to the cost, ignoring the fact that the people bringing these claims are hard-working taxpayers. Does he agree?

[Justin Madders]

I thank the hon. Gentleman for his intervention; his record on representing working people is one of note. He is absolutely right that everyone who takes part in the system contributes already through their taxes. As I will go on to demonstrate, there is little sign of any wider benefit to society. In fact, it could be argued that the fees are creating more problems than they solve.

Between October 2013 and September 2014, there were 32,671 fewer single claims brought by individuals than in the previous 12 months. That is a decrease of 64%. Over the same period, the number of multiple claim cases—those brought by two or more people against the same employer—was down by 3,527. That is a decrease of 67%. Comparing different periods can produce different figures, and an awful lot of different comparisons can be made. Indeed, some comparisons show up to an 80% drop in claims lodged. Whatever the comparisons or periods used, there is an average drop of around 70% in the number of claims lodged. It is therefore indisputable that there has been a significant drop in the number of claims since the introduction of fees.

--- Later in debate ---

[Justin Madders]

My hon. Friend, of course, has great experience in this area. The Government should be setting an example. They should be leading from the front and be seen to be engaging in the processes that promote and encourage good workplace relations. Is it not really something when we have a Government Department potentially discriminating against someone or impinging on their workplace rights, then refusing to engage with the systems that that Government have set up to try to resolve that dispute? And then the Government charge that person to force their rights. What kind of situation is that? It is not a fair, equitable or just way of dealing with matters.

Let me turn to the significant amount of evidence submitted to the Justice Committee. I think my hon. Friend the Member for Wirral West (Margaret Greenwood) has referred to evidence that was given to the Justice Committee in respect of NOMS, and I recommend anyone who has not read those transcripts that look at that evidence. In it, multiple witnesses demonstrate the deterrent effect that fees have had; that evidence goes well beyond the data that have been referred to.

[Chris Stephens]

The hon. Gentleman is making a number of excellent points. On fees, does he agree that there will be an impediment to cases in which a worker brings a case for an illegal deduction of wages, because the fee will be higher in some cases than the amount that the worker is looking for in their claim?

[Justin Madders]

The hon. Gentleman is absolutely right on that point, which I will come to later. Speaking from personal experience as a lawyer before I entered this place, I have a number of examples of such situations, and that cannot be right in a fair and just society. Returning to the Justice Committee, it received evidence from Citizens Advice, which published a report called “Fairer Fees” in January 2015. It stated that 82% of its clients said that the fees deterred them from bringing an employment tribunal claim.

All the Government talk at the introduction of the fee regime was about weeding out vexatious claims. As I will go on to demonstrate, there has been no convincing evidence put forward that this system has done anything to reduce such claims, in stark contrast to the significant body of evidence suggesting that people with genuine complaints have not been able to pursue their rights as a result of the fee system. It may be that part of the Government rationale is that those who use the system should contribute to it, in which case far more equitable solutions can be found. It may be that despite everything else, it is and always was part of the Government’s plan to reduce the number of claims being made, in which case they have succeeded.

--- Later in debate ---

[Justin Madders]

I thank my hon. Friend the shadow Minister for his intervention. Of course he is absolutely right: that advice is an important safety net. I know from experience that the majority of people who are advised that they do not have a claim will take that advice on the chin and will not pursue the claim, so the fact that we have not been able even to maintain levels of access to advice has probably only made the situation worse.

As I was saying before the intervention, there are rules to deal with unmeritorious and vexatious claims. I want the Minister to tell us today whether he considers that those rules are effective, and if he does not, what he will do to change them.

Denying access to justice via a high fee level is arguably making no difference at all to the number of vexatious claims being lodged, because if this system was weeding out vexatious claims, the success rate would increase. The fact that it has not suggests that the fee system is a deterrent to all. Ministry of Justice statistics indicate that success rates have in fact remained broadly the same, rather than increasing. In the four quarters before fees were introduced, success rates ranged between 10% and 9%. In the four quarters after fees were introduced, success rates were broadly similar at 9%, 9%, 5% and 13%. Even the president of the employment tribunals, Mr Brian Doyle, suggested that only a very small percentage of claims can be identified as weak or unmeritorious and that we need to be careful about the way in which we bandy around the term “vexatious” when it comes to claims.

[Chris Stephens]

Can the hon. Gentleman confirm that those workers who have the benefit of trade union membership will find that a trade union also has a test as to whether to proceed with a claim to a tribunal?

[Justin Madders]

I thank the hon. Gentleman for his intervention. He is of course absolutely right. Trade unions play a vital role in ensuring that justice is served for their members, but they also play a wider role by not supporting or endorsing claims that are considered vexatious or weak. We really should mark out that contribution that is made. Of course the vast majority of people who work in this country are not trade union members. Perhaps that is one reason why the figures have not substantially changed as a result of these initiatives from the Government.

The myth that there is a vexatious culture out there has been perpetuated by parts of this Government and certain sections of the media. It is almost as if they believe that there is an army of litigious individuals out there who are routinely fleecing employers with spurious claims. That view has no basis in fact. As I said, there are already rules to stop vexatious claims proceeding. Each case is considered by a legally qualified judge. Most employers have access to professional advice on their case and far more are legally represented at tribunals than claimants—and all of that in a country that regularly appears near the bottom of the pile in any OECD studies of the strength of employment protection across the planet. It is far from the easy ride for employees that some people would portray.

In addition, it is simply not the case that there are hundreds of no win, no fee lawyers out there ready to exploit employers by bringing forth spurious claims. The clue is in the title: “no win, no fee”. If the lawyer does not think that the claim will win, they will not get paid for it, so why would they waste time pursuing a claim that they know will ultimately be unsuccessful?

The idea that employers are a soft touch in these matters is simply untrue. Most are professionally represented and should be able easily to spot someone trying it on. There is a question about how those who are not members of trade unions access affordable representation. We have dealt with that in some of the interventions today. Of course I would say that the best thing that anyone can do to protect themselves in the workplace is to join a trade union, but that is not a substitute for basic advice and support for people who find themselves in these very difficult situations. The Government have pulled the rug out from under them.

This system not only prevents access to justice, but feeds the myth that employment rights are some sort of undesirable impediment to properly functioning businesses. At its worst, it acts as encouragement to those rogue employers who think that employment protection and workplace rights are an optional extra to be ignored whenever possible.

There is plenty of evidence from those representing individuals in employment tribunals, including those who gave evidence to the Justice Committee, that some employers will deliberately decide not to engage in any kind of discussion about resolution of a claim until the very end of the process, even when they may very clearly be in the wrong. The pre-claim conciliation process run by ACAS can be and often is met by employers refusing to engage at all. They know that if they have dismissed an employee, they may not have the funds to pay for a tribunal claim. Even when one is under way, they still hold off until the hearing fee is paid before seriously considering whether they should engage in settlement negotiations. That can be as little as three weeks before the tribunal hearing. That wastes everyone’s time and the tribunal’s and the taxpayer’s resources. There is a category of employers who will not engage with anything unless they know that the employee has paid their £1,200, but even in the cases in which the lower fee applies, there is now a real dilemma facing employees, who are asking themselves, “Can I afford to take this on even though I know I am in the right?”

The starkest example—I referred to this earlier—is one from my own experience shortly before I was elected to this place. It involved an employer systematically refusing to pay their staff over a period of weeks. They refused to engage with ACAS in early conciliation and decided instead to sit back and wait for the tribunal claims that never arrived. The people affected whom I saw were all women and had all lost several weeks’ wages. There was no doubt that money was owed, but all of them questioned spending £390 to recover a similar amount and some of them were actually seeking to recover less than their initial outlay in fees, so for them the dilemma was even greater. Of course, there was no reason to suppose that they would not succeed in their claims, but it is a sad fact that employers, even if they do lose, do not actually pay the compensation due to the employee more than 50% of the time. Given the intransigence shown up to that point, I could not criticise those people at all for not wanting to take that risk.

How can anyone defend the bad employer playing the system and preventing very basic employment rights, including the right to be paid, from being enforced? It does not take a great feat of imagination to see how that attitude can inform an employer’s thinking on whether they should, for example, take steps to dismiss an employee fairly in the first place. After all, if they want rid of someone, why waste too much time on that process if they think that the person will not have the resources to challenge it afterwards? Far from the picture painted by some, this Government are actually creating a culture in which an employer can hire and fire with impunity.

Then there is the situation in which the employer becomes insolvent. The claimant has to apply to the Redundancy Payments Service for redundancy pay, but if there is no employer left to order reimbursement from and it is not recoverable from the national insurance fund, the claimant never recovers their fees. How can it be right that the state can profit from that situation? What kind of situation allows an employee to be, in effect, fined for attempting to exercise their rights in the already difficult situation in which there is an insolvency?

The GMB union has provided a very clear example of what amounts to a significant profit made off the backs of trade union membership fees. It was involved in a claim in Sheffield against a company that in February 2015 went into administration. The business was later sold to new owners, with the original company being wound up. There were redundancies, and the employment tribunal found in favour of the 48 people who brought claims in respect of a failure to consult and unfair dismissal. The claimants were supported by the GMB and three other unions, with fees totalling £13,200 being paid to issue the claims and have them heard. Although the tribunal ordered the respondent to refund the fees, there was virtually no chance of recovering them, as the legal entity had been wound up. Notably, it was only possible for those employees to bring claims because they were supported by a union to get their case before the tribunal. That is a tribute to the importance of trade union membership, but it cannot be right that trade unions or individuals have to make such payments with no avenue for recovering the cost. In that situation they were completely blameless, so why should the state penalise them?

On the question of costs, it has been suggested that one of the justifications for the fee system is that it will recoup some of the costs of the tribunal system. If that was the intention, the system has been a failure. The latest accounts from the Ministry of Justice show that in 2014-15, the net income from employment tribunal fees was £9 million and expenditure on employment tribunal services overall was £71.4 million, which means that the increase in net income from fees covers 12.5% of the cost of running the employment tribunal service. The Government seem to have been unable to quantify, in response to written questions, the extra administration and staffing costs in the tribunal service of having to administer the fees and the remission system. In reality, the gain in revenue is probably lower than 12.5%, and it has been achieved at the expense of a 69% drop in the number of claims.

There is no mention anywhere in any of the documents I have seen of the benefit to the taxpayer from the application of the recoupment regulations, which can result in an employer paying back to the taxpayer thousands of pounds—for example, in jobseeker’s allowance already paid to the claimant—which is offset against the claimant’s compensation. Such repayment is normally ordered where a tribunal has made a finding of unfair dismissal. Why is that clear benefit to the taxpayer not included in any considerations, and has anyone stopped to consider that the level of recoupment will have reduced as the level of claims has reduced—

Trade Union Bill

Debate between Chris Stephens and Justin Madders

Monday 14th September 2015 Commons Chamber

[Justin Madders (Ellesmere Port and Neston) (Lab)]

We have heard rhetoric from Conservative Members about how the Bill will help hard-working people go about their business. Does the hon. Gentleman not therefore find it ironic that curtailing the rights of working people to organise collectively through trade unions, which is what this Bill is designed to do, will stop those people arguing for and bargaining for better working conditions?

[Chris Stephens]

Yes, I do. The Bill is designed to continue austerity—that is exactly what it is about. It is about trying to curb the largest organisation in the UK that is campaigning against austerity.

These issues of gender equality are very important, because recent trends have shown that what is on the increase is pregnant workers being dismissed and women workers coming back from maternity leave being made redundant. That is a recent phenomenon and this Parliament will need to address it. The Government have not taken any of those issues into account. As we heard earlier, 270 Conservative Members would not have been elected if those thresholds had been in place.

There is also the issue of the deadlines on ballot times. I was interested to hear the Secretary of State say that industrial action would not be curbed, but in actual fact it could be. Let us say that a large employer issued a 45-day redundancy notice. If the trade unions have to give 14 days’ notice of a ballot and 14 days’ notice to take industrial action, it will be very difficult for them to organise themselves within that timeframe, and it could well make industrial action impossible.

We oppose the changes on political funds. This is about not just party politics and attacking the Labour party, but the general campaigning that the trade unions fund as well. I am talking here about equal pay; stronger maternity leave; 50:50 gender representation; and giving money to organisations such as HOPE not hate and other anti-racist organisations, community groups, and international aid organisations such as Justice for Colombia and Medical Aid for Palestine.