Employment Rights Bill

Graham Stuart Excerpts

2nd reading
Monday 21st October 2024 Commons Chamber

[Graham Stuart (Beverley and Holderness) (Con)]

The Government’s own impact assessment states that

“the impact on growth could”—

only could—

“be positive”,

and that any such impact

“would be small in magnitude.”

The negative impacts, not least on small businesses, will be very serious in magnitude, as my hon. Friend the Member for North West Norfolk (James Wild) laid out. Will the Deputy Prime Minister please explain how she will minimise the negative impacts?

[Angela Rayner]

We have already been working with businesses while bringing forward the Bill, and we will continue to do that through the consultations. We have recognised probation periods, for example, but we do not think that people should not have rights two years into their employment.

We are listening, but I say to Conservative Members, who promised employment Bill after employment Bill and then never delivered them, that the people of this country deserve secure fairness at work, and this Labour Government will deliver it. Almost 9 million employees will benefit from protection against unfair dismissal from day one, 1.7 million will benefit from new policies on flexible working, and up to 2 million will receive a right to bereavement leave. Thousands of pregnant women and mothers will benefit from new maternity protections, and tens of thousands of fathers and partners will be brought into the scope of paternity leave. We will deliver a genuine living wage that matches the cost of living.

In total, more than 10 million people will benefit from Labour’s plan in every corner of this country, so if you are in casual work, unable to rely on guaranteed hours, this Labour Government are delivering for you. If you are working hard on low pay and struggling to make ends meet, this Government are delivering for you. This is a Government back in the service of working people.

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[Wera Hobhouse (Bath) (LD)]

rose—

[Graham Stuart]

On a point of order, Mr Speaker.

[Mr Speaker]

I hope it is a point of order.

[Graham Stuart]

I believe it is. The Deputy Prime Minister just talked about the amount of money coming into the economy as a result of the measures. Is it appropriate for her and other Members across the House to speak in the debate without mentioning what they have received in donations from trade unions, given how central the law around trade unions is to the Bill?

[Hon. Members]

Not a point of order!

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[Angela Rayner]

Some of the measures in the Bill do recognise the difference between large employers and smaller ones, but we also have to ensure fairness and clarity of purpose in this country, and I think this Bill strikes the right balance. As I have said to other hon. Members who have raised issues regarding small and medium businesses, we are working with those businesses. We have already listened regarding probation periods: the Bill now creates a new statutory probation period so that employers and employees can check whether a job is a good fit. If it turns out not to be right, the Bill allows for a new lighter-touch standard of fairness for employers to meet when they dismiss someone, so I think we are striking the right balance. We have worked very hard on this piece of legislation. If workers are dismissed unfairly, everyone deserves the right to protection, however long they have been in post. With Labour, they will have that right.

Turning to statutory sick pay, no one should feel forced to struggle through work when they are not well. Our view is simple: everyone should be entitled to sick pay from the first day that they are sick, regardless of their earnings, yet 1.3 million employees are currently excluded because they do not earn enough. That means that lower earners, including carers, go to work when ill because they cannot afford not to do so, risking infecting the vulnerable, the elderly, and others with whom they come into contact. No one should want that. Under this Bill, all employees will be entitled to sick pay however much they earn, and that sick pay will be paid from their first day of being ill.

[Graham Stuart]

Will the right hon. Lady give way on that point?

[Angela Rayner]

I have already given way to the right hon. Member, and there are so many other Members who want to speak.

This Government know that the current system does not support working families. We said that we would make flexible working the default, and the Bill will do just that. Flexible working makes workers happier, and we know that businesses that offer it benefit from bigger, better and more diverse recruitment pools. At the same time, we recognise that not all workplaces can accommodate all flexible working requests, so businesses will be able to negotiate or reject unworkable requests as long as that rejection is reasonable.

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[Kevin Hollinrake]

I was not here at the time, but it is clear nevertheless that the minimum wage and the national living wage have had a positive effect on prosperity in this country, and I would be the first to admit it. I want the hon. Lady, and other Government Members, to understand that those measures fell equally on all businesses across the UK. The measures in this Bill fall disproportionately hard on small businesses.

What the right hon. Member for Ashton-under-Lyne (Angela Rayner) fails to understand is that the implication of these measures, such as a day one right to an employment tribunal, is that even a spurious case of unfair dismissal costs time and money. It is potentially tens of thousands of pounds to defend that case. As one business organisation put it, “You lose when you are accused.” Most small businesses saddled with such a cost would be sunk without trace. It is not just that, but the deterrent effect, which it would have had on me, and which will be felt right across the economy and by every existing and aspirant business person across this entire nation. When the Deputy Prime Minister reflects on what she is hearing from people who have actually run a business, will she at the very least consider exempting small and medium enterprises from this catastrophic Bill?

[Graham Stuart]

Like my hon. Friend, I started a business—I started mine a little earlier than him, but that is how much older I am. I followed the Deputy Prime Minister’s speech as carefully as I could. From what I could understand, because of the changes in the Bill, someone can fail to turn up to work on day one claiming that they are sick and then, because they will now have rights against unfair dismissal, they will be able, without ever doing a day’s work, to hold a small business to ransom and put that business at risk.

[Kevin Hollinrake]

As drafted, that is certainly the case. My right hon. Friend is absolutely right. Members may not know that small businesses stand the cost of statutory sick pay. It is not reimbursed by the Government, so the Bill would have a significant cost for businesses.

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[Graham Stuart (Beverley and Holderness) (Con)]

I refer the House to my entry in the Register of Members’ Financial Interests, and the contribution from small businesses to my election campaign earlier this year.

History is repeating itself. Labour’s antipathy and lack of understanding for business, and small business in particular, is rearing its ugly head again. This legislation will have ruinous results for those who desperately need a job and hope. The Federation of Small Businesses says:

“This legislation is a rushed job, clumsy, chaotic and poorly planned.”

The federation goes on to say that the Bill will increase economic inactivity. That is a rather sanitised way of referring to the ruined lives, dashed hopes and huge waste of human potential that the Bill will bring about. At the end of the debate, we need to hear from a Minister how the Bill will be changed so that it supports rather than undermines the 4 million additional jobs created since 2010 under the Conservatives.

The economic impact assessment, so rudely provided so late in the day, shows that the costs of the Bill will fall disproportionately on small businesses—something that we have heard no acknowledgment of from Government Members. Five out of nine measures will have that effect. Do Ministers have any plans to change that?

[Joe Robertson (Isle of Wight East) (Con)]

Does my right hon. Friend agree that provisions that are bad for small business are also bad for workers, bad for taxpayers, and bad for those who rely on welfare payments?

[Graham Stuart]

I entirely agree, and places like the Isle of Wight, with so many hospitality businesses, will pay a particularly high price. We should celebrate and support our wealth creators, not burden them with excessive taxes and regulations that kill the drive to work, invest and create wealth. Yet that is the destructive path that Labour is taking, with a jobs tax planned for every worker’s national insurance contributions in the Budget in a couple of weeks, and this Bill to deter SME employment.

[Antonia Bance (Tipton and Wednesbury) (Lab)]

The impact assessment published earlier was 900 pages long, which compares pretty well with some of the impact assessments published under the last Government, a number of which I had the misfortune to read. It confirms that the cost to business will represent less than 0.4% of total employment costs across the economy, and the majority of that will be transferred directly into the pockets of workers, helping to raise living standards and offset the last 14 years of standstill wages. Has the right hon. Gentleman managed to read the impact assessment yet?

[Graham Stuart]

Well, the impact assessment was provided rather late, but it is always good to have a spontaneous contribution to any debate.

Removing the lower earnings limit and the waiting period will also disproportionately hurt small businesses and microbusinesses. That is set out in black and white in the economic assessment, so will Ministers make changes? It is with dark comedy that the Government say that their top priority is economic growth. Labour inherited the fastest growing economy in the G7, with 4 million more people in work than in 2010—4 million. In 2010, by comparison, we inherited a note that said that the money was all gone.

[Darren Paffey (Southampton Itchen) (Lab)]

Will the right hon. Gentleman give way?

[Graham Stuart]

I will not.

History tells us that Labour Governments always end with unemployment higher than when they began. They do not do it because they are evil. As has been said, no one in the Cabinet comes from a business background; they simply do not understand the realities. This Government seem bent on destroying employment even faster than their predecessors.

Small businesses are the lifeblood of our economy. They do enormous social good. As the FSB says, smaller employers are

“the ones most likely to give opportunities to people furthest from the labour market, such as those returning after long-term health issues or caring responsibilities.”

Yet under these proposals, the

“Plans to give day one unfair dismissal rights to new employees will add to the risks associated with hiring people.”

That increased risk will inevitably deter small employers from taking on new people for fear of facing an employment tribunal simply because a new recruit turns out to be unsuited to the role. How will Ministers ensure that a company selling food at summer festivals is not bankrupted by having to offer a contract to someone who is not needed after that period is over?

The Government have had a disastrous start. It is no wonder that the legislation is chaotic and poorly planned, given that Labour Cabinet Ministers are never early for work but always early for the free buffet at the Emirates or at Taylor Swift concerts. The Deputy Prime Minister is selling out the country’s interests in favour of trade union interests—selling out the people who vote Labour for the people who fund Labour. The Bill is a catastrophe, and I hope the House opposes it today.

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[Alison Griffiths (Bognor Regis and Littlehampton) (Con)]

I refer Members to my entry in the Register of Members’ Financial Interests. I rise today to express my concerns about the impact of the Employment Rights Bill on one of the most vulnerable groups in our workforce: seasonal workers. Those individuals form the backbone of key sectors such as tourism, agriculture and retail, particularly in my constituency of Bognor Regis and Littlehampton, where many depend on seasonal jobs for their livelihoods. I fear that the Bill will put their livelihoods at risk, as well as the viability of the businesses that employ them.

The devil is in the detail, and detail is what the legislation lacks. Labour claims that the Bill will protect workers, but for seasonal employees the increased regulation will likely have the opposite effect. Small and medium-sized businesses that rely on flexible, short-term contracts to meet seasonal demand will face rising costs and greater bureaucracy when trying to bring on staff. Clause 1 on the right to guaranteed hours is so laissez-faire about how that will be implemented in a real-world business environment that it leaves significant ambiguity and doubt in employers’ minds.

[Graham Stuart]

Does my hon. Friend agree that we need more detail from the Minister tonight on that specific provision, before the House can in good conscience give the Bill a Second Reading?

[Alison Griffiths]

I absolutely agree with my right hon. Friend that detail is precisely what is needed for the Bill to be implemented effectively.

In my constituency, seasonal employers such as theme parks are at the mercy of the British weather and a short season. On a rainy day takings will be minimal, and managing costs accordingly is vital to remain viable. Moreover, the student and retired populations in my constituency value the flexibility that those contracts offer. The Bill will disincentivise employers from offering short-term opportunities and reduce employment options for those who depend on temporary work.

Employment Rights Bill

Graham Stuart Excerpts

Report stage
Wednesday 12th March 2025 Commons Chamber

[Sarah Bool (South Northamptonshire) (Con)]

There are 5,310 businesses registered in my constituency of South Northamptonshire. Of those, 99.6%—or specifically 5,245—are small businesses. This Bill, among many of the Government’s policies, is a calamity for those small businesses. Not only are many of them rural, meaning that they will be affected by the family farm tax and now by the removal of the sustainable farming incentive, but as the chair of the Federation of Small Businesses has said, these small and medium-sized enterprises will struggle to adapt to the 28 major changes that the Bill makes to employment law.

First, it was the Government’s jobs tax, then it was their cuts to rate relief for hospitality businesses, and now they are smothering SMEs with red tape. Analysis published by the Department for Business and Trade says that this will impose a cost on businesses in the low billions of pounds per year, but that is not money that many of my small businesses can afford right now. This is why the Opposition have called for small businesses to be exempt from the parts of the Bill that would heap unsustainable costs on them.

Why do the Government seem to hate small businesses so much? Perhaps it is because the majority of the Cabinet have spent their careers in the public sector and have zero understanding of what life is like for the many entrepreneurs with SMEs across the UK, including in my constituency. We learned this week that, for the first time since records began in 2012, the number of companies registered at Companies House has fallen. Growth forecasts have been downgraded and the number of vacancies has declined. All this is a result of the choices the Government have made and continue to make in this Bill.

With all of this, the UK risks becoming a globally uncompetitive economy, particularly when other countries such as the United States are slashing regulation and unleashing their businesses to grow their economies. The Opposition have tabled new clause 90 for exactly this reason. It would ensure that when the Secretary of State makes regulations under part 4 of the Bill, he has to have regard to growth in the medium to long term. I join the shadow Minister, my hon. Friend the Member for Mid Buckinghamshire (Greg Smith), in calling on the Government to support new clauses 89 and 90 to ensure that growth happens. Our economy is already struggling under the weight of Labour’s tax rises. Why are the Government opposing our efforts to ensure that they consider how burdensome regulation might impact on businesses?

[Graham Stuart (Beverley and Holderness) (Con)]

A lot of people outside this place might feel that the answer to that question is that the trade unions have funded Labour Members—[Interruption.] The hon. Member for Derby South (Baggy Shanker), who is talking from a sedentary position, received more than £27,000 from two unions in the latest year of declarations and did not think it appropriate in this debate even to mention that number, which may well have influenced his thinking and led to the dire outcomes that my hon. Friend is explaining to the House.

[Sarah Bool]

My right hon. Friend makes a powerful point, and I think all Labour Members must reflect on this because we need the public to understand truly why this legislation is going through.

That the Government have seen fit to table 87 of their own amendments at this stage alone is indicative of how uneasy they must feel about the Bill. We are even told by the media that the Treasury has warned the Deputy Prime Minister and the Secretary of State about the consequences for the economy of enacting these laws, yet they seem to have seen fit to plough them through anyway. As per usual, Labour is paying lip service to growth while sticking true to form with their socialist ideology. I was not born in the 1970s but it appears that I am going to live through the equivalent in the years ahead, as Labour plays Abba’s 1976 hit “Money, Money, Money” for its trade union paymasters.

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[Gregory Stafford]

I am sorry that I am such a disappointment to the hon. Lady, but maybe she will get over it.

The Bill is a roll-back of the most important changes that we made when we were in government. It is no surprise that trade unions have warmly embraced the legislation, over 200 amendments having been hastily shoehorned in to satisfy those who line the Government’s pockets. Perhaps it is purely coincidental that their wishes have been granted, although one might wonder if the £5.6 million in donations the Labour party has received since July has something to do with it.

[Graham Stuart]

Despite her proud membership of trade unions, the last Labour Member to be called to speak, the hon. Member for Coventry South (Zarah Sultana), did not mention the more than £9,000 that she received just in the last year, any more than the Labour Member who spoke before her, the hon. Member for Derby South (Baggy Shanker), mentioned the £24,000 plus that he received. If Labour Members were truly proud of the way that they have been bought and paid for by the trade unions, perhaps they would be open about how much they have received.

[Gregory Stafford]

My right hon. Friend makes a key point. The change since yesterday has been interesting. Yesterday, Labour Members were clear about declaring that they were members of trade unions, but only today have they suddenly realised that they should be declaring the amount of money that they are receiving directly.

We heard yesterday from the shadow Secretary of State for Levelling Up, Housing and Communities, my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake), that the legislation will allow unions to bypass current rules, such as the rules on opting out of political donations. It must be fantastic news to the Labour party that it will now receive donations from workers by default, while businesses will face reduced notice periods for strikes, leading to even more disruption and economic damage. It is clear to me, and to the hundreds of businesses that have pulled their support for this Government, that this is not about protecting employment rights, but about consolidating union power.

Let us briefly look at some of the amendments. Amendment 292 would require trade unions to notify their members every year of their right to opt out of the political fund, and to obtain an annual opt-in. That change would ensure that unions do not continue to fill Labour’s piggybank, and do not lock workers into automatic donations unless they actively opt out, which is as much a memory test as an admin task. Unamended, clause 52 is not about transparency, but about keeping the money flowing to the political party with the most to gain.

Likewise, there are new clauses and amendments that would have introduced transparency about the facilities provided to trade union officials, learning representatives and equality representatives. Clauses 54 and 56 are designed to reduce transparency and accountability for union spending, allowing union officials to continue to benefit from facility time without proper scrutiny.

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This Bill is not a modernisation of employment rights; it is a gift to the trade unions at the expense of economic growth, job creation and business confidence. The Government have failed to strike the right balance, and we will continue to oppose this legislation.

[Graham Stuart]

The impact assessment states that these measures could have a £5 billion impact, in addition to the £25 billion impact of the national insurance contribution changes. Does my hon. Friend agree that what the impact assessment is missing is how much union funding the measures will drive directly to the Labour party as a result? We ought to know how many hundreds of thousands or millions extra will come to the Labour party and to Labour Members to make them support this growth-killing set of measures.

[Alison Griffiths]

It is a fascinating question, and we wait to hear the answers from Government Members.

[Graham Stuart]

The Minister will tell us, we hope.

[Alison Griffiths]

Indeed, perhaps the Minister will give us the answer.

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[Gregor Poynton]

I will certainly come on to that, but one way is that the Bill will improve employment relations in workforces. In the past 14 years, we have seen strike after strike because of the Conservatives’ approach to industrial relations. This change will improve productivity.

The Bill will deliver real-life improvements that will be felt across Britain. Key amendments that strengthen protections for the lowest-paid workers will ensure that all workers are treated with the decency they deserve. I welcome the vital steps that the Bill takes to extend protection, from exploitative zero-hours contracts, to protecting the voice of working people and strengthening statutory sick pay.

As a member of the Business and Trade Committee, I have been able to scrutinise large businesses that choose to have zero-hours contracts in place. In one evidence session, I heard from a company representative who revealed that employees can have their shift changed at 24 hours’ notice, but not receive a single penny in compensation. The Bill is vital in addressing the challenges of financial planning faced by families who are dependent on zero-hours contracts. More than 1 million people on such contracts will benefit from the guaranteed hours policy. Crucially, the Bill will ensure that Governments work with businesses, and will support employers who endeavour to comply with the law. With the Government amendments, it will also expand and strengthen the powers of the fair work agency to bring civil proceedings against non-compliant employers at employment tribunals and to issue civil penalties, such as fines, to employers who breach pay-related rights and underpay their staff.

[Graham Stuart]

Given that the measures we are debating will give so much more power to the trade unions, why has the hon. Gentleman not felt it incumbent on him to declare the thousands of pounds that he has received from trade unions in the last year?

[Gregor Poynton]

I thank the right hon. Member for highlighting that, because I am proud of the money that I receive from unions. I am also proud of the fact that entrepreneurs and business people donate to my campaign as well. The right hon. Member neglected to mention that when he brought the subject up. Because I am both pro-business and pro-worker, I want to see growth in the economy. I am proud to receive donations from employers and people who have created wealth in this country, and I am also proud to receive donations from trade union members in my constituency.

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[Mr Frith]

I draw Members’ attention to my entry in the Register of Members’ Financial Interests—

[Graham Stuart]

How much?

[Mr Frith]

If the right hon. Member listens, he will hear.

From my entry, Members will see that I am a proud member of the GMB and that my donations include those from entrepreneurs and businesspeople alike who are collectively sick of the 14 years of the Conservative Government. I will take no lessons from that party, given its record over those 14 years, and none of the speeches by Conservative Members have defended any achievements that were made in 14 years relating to this Bill or anything to do with our economy. That is the party of “Eff business”, of a striking NHS, of 60% furlough settlements for Manchester workers, of cash for covid contracts, of inflation highs, of Liz Truss, of the mini-Budget disaster, of zero growth, of the collapse of infrastructure, of public spending power disappearing, and of the state of our roads and of our prospects. It is for this reason that my entry includes a combination of GMB membership, given the members and the workers that we represent, and of the entrepreneurs who wanted rid of that lot over there.

[Graham Stuart]

Will the hon. Gentleman give way?

[Mr Frith]

I will make some progress. The right hon. Gentleman has said plenty already, and he came in only halfway through the debate.

I am proud to stand on the Labour side of the House as someone who has founded a business, run businesses for others and run my own business. Fifteen years ago, I made a commitment to be the voice of experience for good small businesses in the proud Labour movement that we now have in government, not least to challenge the claim of the Conservatives that they alone represent business interests. I am proudly pro-business and pro-worker, just as this Government are. Fixing the foundations of our economy means fixing the foundations of our employment. Just as the Government are strengthening our economic base, they are now laying down stronger employment foundations.

Running a business is hard work. It requires an initial leap of faith, the courage to embrace risk, the ability to adjust, the resilience to overcome failure and the perseverance to celebrate success. The role of government is to improve life and living for everyone in this country. The role of good employment is exactly the same. Small businesses are at the heart of this effort. That is why the Government are right to focus on skills, value for money with public spending, opening up public sector commissioning to SMEs and challenger companies, and, crucially, the Bill making employment a more positive, rewarding experience. Insecure work leads to insecure living, and neither will improve life in Britain. We should highlight and support those employers who are already leading the way. Much of this legislation simply catches up to their high standards.

The weight of responsibility that comes with creating somebody else’s payslip cannot be overstated. It is humbling, sometimes worrying and never easy. It requires teamwork and the skills of others, but also leadership—sometimes lonely leadership. It means shouldering risk and sharing rewards. That is why the Government’s ambition for growth is the right one. The focus must be on net growth, locking in certainty for those in work by upholding rights for the many, while fostering new opportunities to expand our economy.

I want to salute those businesses and entrepreneurs for whom much of this legislation emphasises the good practices they already uphold. In Bury, businesses such as the Lamppost Café, where—a declaration of interest, Madam Deputy Speaker—my daughter works part time, Life Store in Ramsbottom, Wax and Beans record and coffee shop in Bury, Bloom, Avoira, MSL Solution Providers, Ernill’s Bakery, Wallwork Aerospace Heat Treatment, and Hargreaves. These businesses, often family run, are the backbone of Bury, and so they build the backbone of Britain; rooted in their communities; providing stability, pride and good honest work for an honest day’s pay. Many stand ready to do more to grow, invest and create more opportunities.

[Graham Stuart]

I am grateful to the hon. Gentleman for giving way. Could he tell us which of that fine list of businesses have said that they support the Bill?

[Mr Frith]

I have had conversations with the vast majority of them. They support the general emphasis—[Interruption.] Actually, if the right hon. Gentleman has been listening, he will know that the argument I am making is that on much of the proposed legislation—giving rights on day one, being fair minded, making work pay—they are already doing that. The point I am making—[Interruption.] I have just named several. The most recent conversation I had was with MSL Solution Providers. Its challenges and arguments are around R&D tax credits, an argument I will make in due course. But the Conservatives’ claim of being the voice of small business and entrepreneurship is misguided, misrepresented and, frankly, out of date.

Once we have laid the new employment foundations, we must support them in building their businesses further. In particular, for some that means ensuring that AI enhances and expands prospects and prosperity in the employment market and the wider economy.

Lastly, I am proud to highlight my support for extending bereavement leave to those who experience a miscarriage—a compassionate and essential measure that I proudly support alongside my hon. Friend the Member for Luton North (Sarah Owen).

The Bill is not just about a legislative process; it is about our values. It is about recognising that a thriving economy and a fair society must go hand in hand with tackling our inequalities. It is about ensuring that whether employer or employee, the foundation on which our employment is built ensures strength for all.

Employment Rights Bill

Graham Stuart Excerpts

Consideration of Lords message
Wednesday 5th November 2025 Commons Chamber

[Madam Deputy Speaker (Judith Cummins)]

I thank the right hon. Gentleman for his point of order. I refer him to my answer to the previous point of order. It is not a point of order and not a matter for the Chair, but it is a matter of debate.

[Graham Stuart (Beverley and Holderness) (Con)]

Further to that point of order, Madam Deputy Speaker—

[Madam Deputy Speaker (Judith Cummins)]

Can you confirm that it is a point of order?

[Graham Stuart]

It is, Madam Deputy Speaker. You will be aware that a Bill was presented to Parliament only this week that provides for a duty of candour for public servants. It is not enough simply to tell the truth; there has to be a duty of candour. Can you, Madam Deputy Speaker, share with the House whether the sponsoring Minister, the Justice Secretary, has decided to remove himself as the sponsor of that Bill?

[Madam Deputy Speaker (Judith Cummins)]

I thank the right hon. Gentleman for his point of order; it is not a point of order, but a point of argument.

Employment Rights Bill

Graham Stuart Excerpts

Consideration of Lords message
Monday 15th December 2025 Commons Chamber

[Andrew Griffith]

Well no, I cannot, because there is a cap—the very cap that the hon. Member’s party is seeking to remove. I try not to be uncharitable about the complete absence of business experience in the Cabinet, but that level of question, together with that impact, is just embarrassing.

The Minister in her remarks—there was not much of an argument; it was really just a critique—blamed peers in the other place for the Government’s own failures. Notwithstanding how peers are doing the constitutional job we ask them to do, Lyndon B. Johnson said that the first rule of politics is to learn how to count. The Government lost the vote on its unemployment Bill last week by 24 votes, but 65 of their own peers did not want anything to do with the Bill—they did not turn up and did not vote. During the passage of the Bill, one Labour peer has even resigned his peerage and joined the exodus of wealth creators to the United Arab Emirates because of what he sees. The Resolution Foundation and the Tony Blair Institute have both criticised the Bill.

By removing that £118,000 compensation cap, the Government are not protecting the vulnerable. If that is what they wish to do, there are other ways to do that, but ordinary workers will never benefit from that. It is a genuinely mad world; I do not understand why we are having this debate.

This time last week, the Liberal Democrats agreed with me on this. The hon. Member for Tunbridge Wells (Mike Martin) has been campaigning for the boss of South East Water to be fired, but without a cap his payout could be millions. Is that really what they want? What changed, other than the appearance of five new Liberal Democrat peers?

[Graham Stuart (Beverley and Holderness) (Con)]

Will my hon. Friend give way?

[Andrew Griffith]

I will do so briefly. After that, I want to conclude.

[Graham Stuart]

I am extremely grateful. My hon. Friend is setting out a powerful case. We are puzzled, because a system designed for ordinary workers that has a sensible cap is now being opened up to the very CEOs who, as has been highlighted, would not have previously used it. We have a Labour party in hock to the unions yet strangely proposing a measure that was not included their manifesto which can only help the rich. What happened to the Labour party?

[Andrew Griffith]

I thank my right hon. Friend for that intervention. I will leave that hanging there and hope that Labour Members will address it.

In conclusion, I ask the Government at this eleventh hour to pull back from the brink and introduce a financial cap so that we can get this business done this week. They have no consent from business, and they sought no support for it in their manifesto. I have talked about youth unemployment and the level of redundancies. We Conservatives will get Britain working again. We will end the attacks on employers and repeal the job-killing measures in the Bill. For the sake of businesses, for the sake of the backlog and for the sake of Britain, the Government should accept the Lords amendment and drop their motion.

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

May I first declare my entry in the Register of Members’ Financial Interests and donations from the Union of Shop, Distributive and Allied Workers trade union, as well as my membership of the GMB and Unite trade unions? I am not sure if we are on a ping or a pong now, but there is a whiff of stubbornness about the fact that we are back here again.

Last week, I called for the Government to make this place sit every day until Christmas to ensure we got the Bill through—it is a shame that the other place took that as an invitation rather than the contingency plan it was intended to be, but, if that is what it takes, that is what we should do. We are ready. It is wrong that an unelected house, where jobs are given for life, can dig in and push back on something that will give millions of workers rights that we promised long ahead of an election, and for which we have a decisive mandate.

I commend the Government and the Minister for not backing down. A deal was reached with the relevant stakeholders. It is a pragmatic compromise, and a deal they are publicly saying needs to go through. That is how mature, effective industrial relations are supposed to work.

I do not think that the Lords’ arguments are particularly substantial; they are certainly not reasons to delay the Bill again. Their point that we should not agree with the lifting of the cap because it fell outside the scope of manifesto commitments in this area does not really take us very far, given that the original concession made on qualifying periods was also outside the scope of the manifesto, and of course, that is all part of the same package. It feels to me that this is more about the Lords wanting to have the final word rather than having to deal with the substance.

[Graham Stuart]

We did not hear it from the Minister, so could the hon. Member please explain the case for removing the cap?

[Justin Madders]

I am glad that there are some Conservative Back Benchers here. Last week they were all somewhere else, but now we are hearing some contributions. I was not in the room when the negotiations took place, but I understand that that was the deal. I am afraid that there have been some wilful misunderstandings on the Conservative Benches about what lifting the compensation cap actually means. Compensation for unfair dismissal is calculated by defined heads of loss under the law, so lifting the cap will not change that one bit. If the claims are still necessary, they will be there. It just means that some workers—particularly older workers who might not be able to get another job and who may have substantial pension losses—will benefit, not the fat-cat bosses that have been talked about. It is important that we stress that point.

Also, I do not remember the Conservatives’ manifesto in 2010 promising to double the period for qualification on unfair dismissal. Neither do I remember a pledge in either the Tory or the Liberal Democrat manifesto to put a cap on compensation. None the less, the coalition Government pushed both those policies through. Those who claim that the lifting of the cap will see an avalanche of claims ignore the fact that the rationale used for introducing the cap in the first place was to deal with perceptions about levels of compensation people might recover—in other words, legislating on perceptions rather than on facts—and I have to say, we have heard plenty of those perceptions repeated again tonight.

The Opposition can complain about a two-year wait for tribunal claims, but I am grateful to the shadow Secretary of State for recognising his party’s culpability in that. It is important that this Government are working with the trade unions, businesses, the judiciary and ACAS to find ways of improving our system, so that we get justice more quickly, instead of just ignoring it as the previous Government did. This Government have shown flexibility and strength to negotiate a change in order to get a deal over the line. Workers in this country should not be made to wait any longer for these important rights.

It is worth reminding the House that the road map we agreed earlier this year shows that the following laws should be in place by April 2026: doubling the maximum period of the protective award; day one paternity leave and unpaid parental leave; whistleblowing protections; establishing the Fair Work Agency; day one statutory sick pay and entitlements for the first time for millions of people who have been denied them to date; and simplifying the trade union recognition process. These are not minor or trivial measures. They are substantial changes that will improve the working lives of millions of people. We should be proud that it is a Labour Government who are delivering them, and we should be determined to deliver them by April 2026.

Of course, that is just the beginning. Genuine flexible working, ending zero-hours contracts, banning fire and rehire—there is much more in this Bill that really matters to working people. And there is much more beyond the Bill: the reform of TUPE and parental leave and dealing with the epidemic of bogus self-employment are of huge importance. These are the sorts of things that a radical, reforming Labour Government need to tackle, because the world of work is changing. It is changing far faster than we can legislate for, but we can insulate our constituents against the worst excesses and unintended consequences of the tech revolution by putting security and fairness at the heart of every employment relationship, and we need to do that now. If we do not, we will have failed not only to deliver on the promises we made but to stand up for the very people we were elected to represent, so I call on the other place to agree with the will of the democratically elected Chamber and to deliver finally on our promise to make work pay.

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[Sarah Olney]

I am glad that the hon. Member has raised that. I was coming to that in my speech. Perhaps he could listen with a little more attention.

Employers have finally been given the necessary clarity to make hiring decisions with confidence, and we have avoided the danger of unnecessarily slowing down the labour market even further, which would have deprived so many people of vital employment opportunities. That is exactly what the progressive Resolution Foundation think-tank warned of when it said there was a risk that

“employers would be nervous about hiring new workers or offering shifts, and this would make life harder for job seekers.”

As I pointed out last week, it is really disappointing that the Government decided to muddy this improvement by simultaneously abolishing the cap on compensation for unfair dismissal. Employers were not in favour of scrapping the £118,000 cap, and I once again point out that bringing in a change like this at the last minute is not how we build trust between Government and business. However, I note that employers and business groups have been equally clear that this last-minute change must not stand in the way of the far more important changes secured with regard to the six-month qualifying period. Above all else, business values pragmatism, and that is exactly why it wants to see this breakthrough protected and enshrined in law. That is what has guided our approach throughout.

Will the Minister confirm on the Floor of the House that the Government will conduct an assessment of the impact of the removal of the compensation cap, actively seeking views from businesses, as was indicated to the Liberal Democrats in the other place? On a broader level, will she give a cast-iron commitment that the Government will hold regular debates in both Houses to ensure that Parliament can scrutinise what work is being done to consult businesses and workers on all relevant implementation aspects of this Bill? How are the Government planning to support employers in order to ensure that they have robust policies and practices in place to navigate these changes to the unfair dismissal regime?

Lastly, to those in the Conservative party who have been trying to sabotage this crucial compromise on the six-month qualifying period, I simply say that they are acting not in the interest of British businesses but only in their own narrow party political self-interest.

[Graham Stuart]

On that very point, does the hon. Member believe that it is totally pragmatic to have disregarded her objections to the removal of the cap in return for additional places for the Liberal Democrats in the House of Lords?

[Sarah Olney]

It is so revealing of Conservative Members’ mindset that they cannot believe what I am actually saying is the reason for our change, and that they assume instead that we must have sought some benefit for ourselves. It is so revealing that that is what the Tories think. It beggars belief that the Conservatives, having hammered businesses while in government, are now doing everything in their power to undermine UK plc from the Opposition Benches.

I note that the Government have taken steps to improve the clarity of the legislation with regard to seasonal work, introducing measures that will ensure that businesses relying on seasonal work and bodies representing seasonal workers will be properly consulted when secondary legislation is drawn up. Many businesses, such as those in the farming and agricultural sector, as well as thousands of pubs, cafés and restaurants, depend on seasonal workers, and any obstacles to hiring them could have a significant impact, exacerbating the long list of challenges they already face, so we must ensure that they are supported as much as possible. Small businesses in our local towns and communities are struggling with the Government’s unfair national insurance rise, high export costs due to Brexit red tape and a business rates system that is not fit for purpose. Struggling businesses mean fewer jobs and lower pay, so it is vital that we take steps to support high street businesses and all those who rely on them.

It is time that we listened to the business community, which is telling us that the best way forward is to look for balanced solutions through secondary legislation and to put an end to the uncertainty and avoid losing the six-month qualifying period, which we were happy to have helped secure. Continuing to delay the passage of the Bill at this late and protracted stage would risk further uncertainty for businesses, particularly small and medium-sized enterprises, and would jeopardise significant changes that will benefit workers, such as expanded protections against workplace harassment and improved paternity leave rights.

I urge Members to be pragmatic and to provide clarity to businesses and workers alike regarding an implementation timeline. That is critical for providing a stable operating framework so that businesses can plan ahead. We should now work together to ensure that this legislation can be implemented to benefit businesses and workers alike.

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[Bradley Thomas]

I will make progress.

The idea that removing the cap will lead to anything other than a surge in cases is pure fantasy. This lack of understanding shows why the Government must listen to those who know how business works and recognise the devastating consequences that the Bill will have for companies and, crucially, for workers, rather than branding themselves champions of working people while advancing policies that benefit only high-fliers.

[Graham Stuart]

Labour colleagues shake their heads as my hon. Friend lays out the blindingly obvious. That goes to show why introducing a measure at the last minute during ping-pong is inappropriate and precisely why the House of Lords is right to say that we must consider this fully. It is quite obvious that Labour Members do not want to understand it; they obviously do not understand the implications.

[Bradley Thomas]

I thank my right hon. Friend, who makes his point eloquently, as usual.

The Government must abandon the measure. If they are really on the side of workers, the best thing they can do is abandon this measure—and abandon the Bill in its entirety.