Enterprise and Regulatory Reform Bill

Ian Murray Excerpts

Wednesday 17th October 2012 Commons Chamber

[Jo Swinson]

I thank my hon. Friend for that intervention. He rightly says that we want that process to be a success, and enabling the technology of the telephone to be used in it is a helpful, albeit minor, amendment.

Opposition Members have tabled a number of amendments on the early conciliation process. Amendment 80 seeks to require the Secretary of State to consult on, and undertake an assessment of, the impact of the introduction of fee charging in employment tribunals on the effectiveness of early conciliation before commencing these provisions. Hon. Members will know that the power to charge fees in tribunals is one that already existed; we announced our intention to introduce fees in employment tribunals in January 2011, and subsequently consulted on the appropriate charging points and fee levels in December 2011.

We recognise that the introduction of fees to bring an employment tribunal claim may affect the behaviours of both claimants and respondents, and that there may therefore be an impact on how parties elect to engage with early conciliation. We considered the possible impact as part of the assessment that accompanied the announcement in November 2011 of our intention to introduce early conciliation—copies are in the Library of the House. As part of the implementation planning, we will publish further impact assessments. The proposed amendment would simply require us to replicate work that we have already done and will continue to do, so I am unable to support it. The amendment is unnecessary, but I can give the assurance that we are, of course, continuing to take into account the impact that our approach will have.

[Ian Murray (Edinburgh South) (Lab)]

I wonder how the Minister would deal with an issue that has been raised by the chair of ACAS, Ed Sweeney. He said that the introduction of the fee structure could have an impact on the effectiveness of conciliation at ACAS.

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[Jo Swinson]

I will give way shortly.

We believe our approach to settlement agreements is a more effective way of dealing with workplace problems, as it offers a positive outcome for all parties. Settlement agreements are by definition voluntary and consensual. Individuals will still need to get independent legal advice before signing an agreement and can decline it if they want to do so. That approach has the benefit that an agreed settlement gives an employer surety that they will not face a tribunal case on any grounds covered by the settlement agreement, which a no-fault dismissal regime would not provide. Employees are at liberty to reject an offer when it is not right for them and our approach does not remove an employer’s obligations not to discriminate or prevent an individual from bringing other evidence to support a case of unfair dismissal.

[Ian Murray]

rose—

[Jo Swinson]

I shall give way first to the hon. Member for Leyton and Wanstead (John Cryer).

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[Ian Murray]

The Minister is being incredibly generous in taking our interventions. Does she not accept that settlement agreements, while they can be used where there is no dispute, are likely to create dispute?

[Jo Swinson]

I do not think so. Clearly it is important that the conversation is conducted in a mature and respectful way, and the guidance, on which we are consulting and which will include things such as guideline letters and templates, is expressly designed to make that easier for employers. The problem the hon. Gentleman raises is precisely the opposite of what the proposals will address, because now, where protected conversations can happen if there is a dispute, that creates a perverse incentive to employers to try to manufacture a dispute. Hopefully, the proposed measures will make it much easier for people to have that conversation without having to pretend that there is a dispute where none exists.

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[Jo Swinson]

I think I thank my hon. Friend for his intervention. The fact that there is criticism from both sides shows that a balanced approach is being taken. I shall make progress as I know that other Members want to speak.

[Ian Murray]

I am grateful to the Minister for allowing me to intervene. Let us nail once and for all the myth about employment tribunal claims. The Government used this as the supposed evidence for changing a range of workers’ rights. The massive increase in employment tribunal claims arises from multiple claims, which have risen substantially, but the individual number of multiple claims has stayed exactly the same for the past three or four years. Indeed, employment tribunal claims are dropping.

[Jo Swinson]

The fact remains that there is a massive backlog of employment tribunal claims, there are massive problems with the way the system is working, and there is significant concern in the business community, which has been expressed in the House and in Committee. I shall move on to the other amendments before allowing other Members to have their say.

Government amendments 11 to 15 to clause 13 will ensure that the power in the Bill to amend the unfair dismissal cap cannot be used to introduce a cap based on an individual’s pay without there also being a specified upper limit. My hon. Friend the Member for North West Leicestershire (Andrew Bridgen) raised a concern in Committee that, as it stands, the power in clause 13 could be used to introduce a pay-based cap with no upper limit. Clearly, such a step would increase potential compensation for the very highly paid and could thereby increase risks and uncertainty for employers. As my hon. Friend the Member for North Norfolk who is now the Minister of State, Department of Health, made clear at the time, this is not the Government’s intention. On the contrary, we are seeking to give employers greater confidence in dealing with disputes and to ensure greater realism about the level of awards in order to encourage settlement.

We launched a consultation on proposals to change the cap on compensation for unfair dismissal on 14 September, alongside our consultation on settlement agreements. The consultation includes looking at the overall level of the cap and also the option of introducing a pay-based cap alongside a specified upper limit. We therefore seek to make these amendments to ensure that the power in clause 13 reflects the Government’s policy intentions.

Opposition Members have proposed three amendments to this clause, the first of which, amendment 82, would delete the clause in its entirety. It has been a matter of common agreement for many years that the compensatory award should be subject to an upper limit. What that limit should be is the issue in question. This clause recognises the agreement that exists about the need for an upper limit, but provides a power for the Secretary of State to vary that limit subject to specific considerations. As I have said, we are consulting on what the appropriate limit should be. I am therefore unable to accept the amendment.

Amendment 70, tabled by the hon. Member for Hayes and Harlington (John McDonnell), seeks to remove the upper limit of three times median salary. The effect of this would be to allow the cap to be set at any amount. This would clearly run counter to the objectives that I set out a moment ago of greater confidence for business and greater realism for claimants. The hon. Gentleman tabled a further amendment to the clause, amendment 71, which would require the Secretary of State to consult the TUC and the CBI before deciding on a figure for median annual earnings where the figure published by the Statistics Board is more than two years old. I cannot envisage a situation in which such information would not be produced by the ONS in any two-year period but, should such an eventuality ever arise, the Secretary of State will be under a duty to act reasonably and rely upon relevant information. The Secretary of State and other Ministers meet the TUC and CBI regularly to discuss a range of matters, so there is little to be gained from placing a requirement to consult the TUC and the CBI on the face of the Bill. I am therefore unable to support either of the hon. Gentleman’s amendments.

I turn now to the amendments to clause 14 tabled by my hon. Friend the Member for Bedford (Richard Fuller). Amendment 58 would delete clause 14 in its entirety. Amendment 59 seeks to restrict the imposition of a financial penalty to those businesses employing more than 10 people—that is, to exempt micro-businesses. I want to make it clear, as did my predecessor in Committee, that the introduction of this discretionary power for tribunals is not intended to penalise employers indiscriminately. It will be used only when an employer has breached an individual’s employment rights, and when that breach has been accompanied by aggravating features—for example, where there has been a deliberate decision to act in a way that breaches the employee’s rights, or where the same employer repeatedly acts in an unlawful manner.

When we first proposed the introduction of financial penalties, we had thought to make the imposition of the penalty automatic when there was a finding in favour of the claimant, but we listened to the concerns expressed by business during the resolving workplace disputes consultation last year and revised our proposals to give the tribunal discretion to decide when a penalty was appropriate. Good employers—those who try to do right by their employees—have nothing to fear, regardless of their size. A genuine mistake will not be grounds for the imposition of a penalty. However, those businesses which the tribunal considers have acted deliberately or maliciously will rightly, I believe, face the prospect of a financial penalty. They will no longer be able to gain a competitive advantage over businesses that abide by their obligations.

I cannot stand here and defend bad employers. I recognise the good work that my hon. Friend the Member for Bedford has done to support the interests of small businesses, and I am sure he does not want to defend bad employers either. I hope he will not press his amendments, as the Government are unable to support them.

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[Jo Swinson]

As I have said, this is a new measure and these are the figures we have put in place. I do not know what figures the hon. Lady thinks should be set. It is important that there is some certainty for businesses and so, after progressing with this measure and putting it in place, we can then review it and see how it works. By ensuring that the specific amount is not set in primary legislation, we will have the ability to amend it through secondary legislation, which will give the required flexibility. Amendments 72 and 83 would undermine the objectives of the financial penalty regime and so I am unable to accept them.

The final amendment to clause 14, amendment 73, tabled by the hon. Member for Hayes and Harlington, seeks to specify the purpose for which any moneys accruing to the Exchequer from the imposition of financial penalties should be used. Hon. Members will know that the Government already fund the activities to which the amendment refers through ACAS, with an annual grant in aid allocation of about £45 million a year. As my predecessor made clear in Committee, the purpose of the financial penalty is not to raise revenue for the Exchequer. It would not be appropriate to expect ACAS to function with some element of its annual funding being dependent on what is ultimately a discretionary decision by a tribunal. The existing mechanism for funding ACAS is the right one, so I am unable to accept the amendment.

Amendment 94 seeks to address a point we covered in Committee. I understand that its aim is to prevent a disclosure relating to a breach of a private contract from being a qualifying disclosure for the purposes of a whistleblowing claim, unless it is clearly in the public interest. My predecessor, my hon. Friend the Member for North Norfolk, explained in Committee our reasons for not wanting to take that route. We believe that such an approach would have the potential for unintended consequences and would not in itself address the concerns raised by the Parkins v. Sodexho decision. For example, the issue in that case could have been reframed as a health and safety issue, with similar issues then arising in relation to the disclosures of minor breaches of health and safety legislation, which are of no interest to the wider public. Not only are we closing the loophole identified in the Parkins v. Sodexho case, but by introducing the public interest test we are removing the potential for the opportunistic use of the protection. That will prevent any cases similar to the Parkins v. Sodexho case in the areas that would otherwise be uncovered by the amendment.

[Ian Murray]

I am grateful to the Minister, who is being incredibly generous in giving way. What would she say to the Law Society, which says that the clause will not do what the Government intend it to do?

[Jo Swinson]

I think that it will do what the Government intend it to do—basically what it says on the tin. It is about making sure that the public interest disclosure regime has to have a public interest test. That is what was meant when the legislation was initially framed and formed. The case law that has come up since then has showed that there was a loophole, and I think, to be fair, that the Opposition have accepted that it needs to be closed.

Following my discussions with the hon. Member for North Ayrshire and Arran, the House may wish to be aware of the steps that the Government are taking in the NHS to encourage whistleblowers. As I said during the recent debate on the issue, the Government fully support the rights of NHS staff to raise concerns in the public interest. That right has been enshrined in the NHS constitution and further strengthened through changes made to the constitution and the handbook in March this year. The Department of Health is continuing to build on the rights set out in the Public Interest Disclosure Act 1998 further to highlight the statutory protections available for those who raise concerns. I want to stress that the Government fully support genuine whistleblowers and want to encourage individuals to bring issues to light, but we need to ensure that the balance of protection for employers and individuals is correct. We believe that the current clause achieves this, and I am therefore unable to support the hon. Lady’s amendment. However, I welcome the constructive work that she, among others, has been doing on the issue.

The hon. Member for Oldham East and Saddleworth (Debbie Abrahams) asked about the level of £5,000 and penalties. The provision is intended to mirror the national minimum wage compliance regime, so there is method behind it, but it will be possible to amend it if necessary.

I turn now to our amendments 16, 17 and 31 to clause 17. Members who followed the progress of the Bill through Committee will recall that the original clause, then clause 16, was accepted into the Bill without debate. The purpose of the clause then, as now, was to amend specified primary legislation to replace all references to “compromise agreements”, “compromise contracts” and “compromises”, where they occur in an employment context, with the terms “settlement agreement” or “settlement”. By renaming compromise agreements, we are addressing any conscious or sub-conscious reluctance by a party to use these agreements arising from the perception that they are conceding or “giving in” on some or all of their arguments. The original drafting of the clause—with the agreement of the Under-Secretary of State for Skills, the hon. Member for West Suffolk (Matthew Hancock)—extended the change of name to Northern Ireland in so far as it related to the National Minimum Wage Act 1998. Having since considered matters further, my Northern Ireland colleagues have concluded that such a change should not be made in isolation and should form part of the wider review of employment law that they have recently launched. As a consequence, it is necessary make minor amendments to restrict the effect of the name change to England, Scotland and Wales in only that Act.

I commend the Government amendments to the House and hope that I have fully explained why we are unable to support the other amendments in the group.

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[Mr Speaker]

I am extremely grateful to the hon. Gentleman for his point of order, and the reaction of the House shows that Members as a whole are as well. I thank him for what he said and for his participation in the election.

[Ian Murray]

I congratulate the hon. Member for Broxbourne (Mr Walker) on his election to the Procedure Committee.

Let me, too, start with an affair of state by saying happy birthday to the shadow Secretary of State for Business, Innovation and Skills, my hon. Friend the Member for Streatham (Mr Umunna). I will not lead the House in a chorus of “Happy Birthday”, but we wish him many happy returns.

While I warmly welcome the new Minister to her place, I have to say, with a tinge of disappointment, that I will miss her predecessor, the hon. Member for North Norfolk (Norman Lamb), for two reasons. First, we incessantly used his book, “How to maximise compensation at an employment tribunal”, in Committee. [Interruption.] For the information of the hon. Member for Skipton and Ripon (Julian Smith), the then Minister was formerly an employment lawyer. Secondly, at the end of Committee proceedings we bought him a small gift, “Fifty Shades of Grey”, relating to his other passion in life, and I was looking forward to questioning him on that. I hope that the hon. Lady has read the book, because then some of the references in my speech might make more sense.

It is an indictment of how uncomfortable the Minister is with this part of the Bill that the Government have restricted the time available on Report to deal with the complicated issues within it. Let me be clear from the outset. It does not matter how much the Secretary of State stamps his feet or the Liberal Democrat Minister denies it, this Bill is delivering Beecroft by the back door. It is not just Labour Members who are saying that. I am delighted that the hon. Member for Skipton and Ripon is in his place, because he said the same in Committee, much to the disdain of the former Minister. As is consistent with most of the clauses in this hotch-potch of an enterprise Bill, these changes to rights at work are not about enterprise and are not a panacea for a Government with no strategy for growth.

I cannot emphasise enough that the hard-fought-for rights of employees up and down this country are not the reason we are in a double-dip recession; the failed economic policies of this Government are the reason.

[Julian Smith]

rose—

[Ian Murray]

Let me make some progress, and then I will give way.

To start with the positives, I welcome new clause 8, which is derived from the report by Mr Justice Underhill and his esteemed team. We have always recognised the need to review the procedures of the employment tribunal system to make it work better for employees and employers, but with these proposals we have particular concerns about the increased use of deposit orders. We support the premise of deposit orders in deterring claims which may be unmeritorious, but we fear that their increased use, combined with the introduction of the fees regime, may restrict access to justice. This has the potential not only to restrict justice but to do so for the most vulnerable employees in the employment tribunal system. Will the Minister assess the impact of the changes on deposit orders? I appreciate her giving the commitment that if there were an impact she would return to the issue, but it is strange that these proposals have been introduced. Several of my hon. Friends have been asking about the evidence for doing so. Despite repeated pleas in Committee to produce a proper impact assessment on the insertion of fees into the process, that has not happened.

I welcome the provisions to allow for costs for lay representatives. We agree with Mr Justice Underhill when he said:

“We can see no reason why the claimant should not be able to recover those charges when he would have been able to if he had instructed a legal representative.”

We will not oppose these changes in new clause 8, as they have been properly evidenced, but I could not say that about the rest of part 2, where the Government have absolutely no evidence for any of their proposed changes. Indeed, their own impact assessments, and business surveys, show that there is little appetite for them in the business community. Businesses tell me and other Members that their main concerns are not employee regulations but lack of finance and the general state of the economy.

The reality is that the previous Labour Government created nearly 2 million jobs and 1 million businesses within the current system of employment rights. Mr Beecroft himself agreed, in effect, when he said in Committee that he had no empirical evidence but was basing these recommendations on experience and from talking to people in the pub. In Committee, we had a perfect 10 from Government Members in terms of anecdotes. I am sure that at one point we even heard a direct quote from the managing director of “Anecdotes R Us”. The evidence, particularly from the OECD, shows that the United Kingdom has the third most liberal employment rights regime in the western world.

[Stella Creasy (Walthamstow) (Lab/Co-op)]

Does my hon. Friend agree that taking advice on employment rights from somebody who profits from legal loan sharks is perhaps not the right way forward when looking for effective guidelines and regulation?

[Ian Murray]

I am grateful for my hon. Friend’s intervention. I think that people can make up their own minds about the ideology and ethos of the report.

Amendment 80 deals with fees and their impact on ACAS early conciliation. In Committee we pressed amendments to assist applicants and to ensure that ACAS was properly resourced. The amendment covers a similar concern that we have about the new deposit orders. We welcome the new role for compulsory early conciliation by ACAS, but we are concerned that the insertion of the fees system after the ACAS conciliation process will dilute the effectiveness of conciliation and put employees in the untenable position of having to settle their dispute or find the necessary £1,200 to take it beyond the ACAS system.

Ed Sweeney, the chair of ACAS—I have mentioned this already—said during his evidence to the Committee that

“we do not know whether charging for tribunals would have an adverse effect on either employers or employees…Will there be less, from an employer’s point of view, of engaging in conciliation”?––[Official Report, Enterprise and Regulatory Reform Public Bill Committee, 19 June 2012; c. 68, Q146.]

The Minister herself has admitted that there could be an issue and will deal with that after the system is up and running. Despite being pressed time and again on this issue in Committee, no Minister has produced an impact assessment on the impact of ACAS conciliation when low-paid and vulnerable workers will have to find a fee to enter the employment tribunal system.

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Teresa Pearce (Erith and Thamesmead) (Lab): Can my hon. Friend clarify something for me? The Minister said that, by definition, a settlement agreement would not amount to sacking an employee. Under the new sanctions regime for jobseeker’s allowance, if someone leaves their job voluntarily they cannot claim JSA for 13 weeks. Would a settlement agreement amount to them leaving their job voluntarily?

[Ian Murray]

My hon. Friend asks an exceptionally good question. I think that it would amount to a voluntary leaving of work, because the employee will not have been sacked—they will have come to an agreement with their employer that they will leave. They will not have been made redundant. I hope that the Minister will address that issue, because it could have significant consequences.

[Julian Smith]

It is incredible that the hon. Gentleman is unable to understand the frustration of many businesses on the issue of coming to the end of an employment relationship. Does he not understand how frustrating it is for many entrepreneurs throughout the country to finish a relationship with an employee that is not working out?

[Ian Murray]

The hon. Gentleman makes a tremendous intervention, because he is actually arguing our point: the proposals are bad for business. We would accept the Underhill review’s proposal to make the employment tribunal better and we would accept, with minor amendments, the ACAS proposal for early conciliation, but to put in place a compensated, no-fault-dismissal-cum-protected-conversation system would be bad for business. The hon. Gentleman must also realise that the Business Department’s own small business survey showed that only 6% of businesses listed regulation as a concern. That included all regulation, so employment regulation was only a minor part of it. He can shake his head, but that is what BIS’s own impact assessment says.

[Catherine McKinnell]

The shadow Minister is making a powerful case as to why the measures are bad for business. To follow on from the important point made by my hon. Friend the Member for Sunderland Central (Julie Elliott), people who rely on mortgage protection insurance are also likely to be adversely affected if they enter into a settlement agreement. Have the Government considered whether that protection could be invoked if those affected enter into a voluntary agreement to leave their employment?

[Ian Murray]

My hon. Friend makes a fantastic point. I do not have the answer, because the Government have not told us, but it seems that if an insurance company can do anything to get out of paying a particular insurance policy, it will do so. Perhaps the Minister will address that.

Citizens Advice has said clearly—I think it has sent this briefing to all Members—that

“this looks less like an attempt to encourage more use of compromise agreements, than a further erosion of the legal protection against unfair dismissal.”

The Minister has been challenged to say exactly what the settlement agreement represents and to come clean. If she did so, this would be a far easier debate to deal with.

The current system allows for the use of compromise agreements when there is a dispute. The new settlement agreements can be used at any time, but it is clear that they are likely to create a dispute. The reality is that the mere fact of instigating discussions without prior process is likely to cause the end of the employment relationship, which is exactly what the employer will want. It is the equivalent of one party in a personal relationship saying to the other party, completely out of the blue, “I don’t love you anymore.” Who would hang around after that? [Interruption.] My hon. Friend the Member for Hartlepool (Mr Wright) suggests that I am speaking from personal experience, but I could not possibly comment. We propose to delete the Beecroft clause, because it is bad for business and equally bad for employees.

[Julian Smith]

Will the hon. Gentleman confirm that Labour does not believe that regulation is a big issue for business?

[Ian Murray]

The hon. Gentleman spent a lot of time in Committee posing such questions, but the Federation of Small Businesses, the Engineering Employers Federation, Citizens Advice and many of the top groups that deal with employers and employees tell us that a compensated, no-fault dismissal is bad for business, and BIS’s own impact assessment says exactly the same. Until the Government can produce empirical evidence that underpins some of the Beecroft reforms, I am unwilling to believe what the hon. Gentleman says.

I hope that the Minister has listened to my comments on amendment 81 and I will test the opinion of the House on it at the appropriate time.

Amendment 82 would remove clause 13 and its provision on compensatory awards. The clause gives the Secretary of State the power to alter the amount of compensation paid to an employee who is found by a judge to have been unfairly dismissed. Every Government member of the Committee indicated that they want the amount to be drastically reduced, despite the fact that the Bill gives the Secretary of State the potential to increase it from its current level of £72,000. The Secretary of State has indicated that his cap would be a maximum of either an annual salary or median earnings, whichever is the lower, potentially limiting all claims to about £26,000, the effect of which would be to hit anyone who earns more than average earnings. This Government have hit middle earners time and again and these proposals have the potential to hit them hardest when they will have actually won a claim at an employment tribunal. It should be up to the employment tribunal judge to decide what an adequate compensatory award is, not the Secretary of State.

I will give the House an anonymised example. A claimant was dismissed at the age of 58. He was earning as little as £26,020 net per year, but owing to dismissal will not attain that level of earnings before he retires at 65. After eight months of unemployment, the claimant got a job on £20,020 net per year. His loss was calculated by a judge at an employment tribunal to be £124,200. Under the current regime, he would receive 62% of that claim. Under the Secretary of State’s regime, he would receive less than 20% of it. That is somebody on fairly average earnings of about £26,000 a year. Citizens Advice has stated:

“The idea that this could have a measurable effect on the behaviour of workers and employers is not credible”.

It proposes the deletion of clause 13 on that basis. That is why I would like to test the opinion of the House later this afternoon.

The critical point is that the combined impact of settlement agreements, ACAS early conciliation, fees and the lowering of the cap on compensatory awards will deliver the very compensated no-fault dismissal that was in the Beecroft report. Let me demonstrate why. If an employer decides that he no longer likes an employee, he might offer them a sum of money to leave his employment in a settlement agreement. The employer could say that the amount offered will be reduced each day that the settlement agreement is not accepted. The employee will feel pressured into accepting an offer for fear of victimisation, for fear that the offer will be withdrawn or reduced over time, or because of the spectre of having to take an unfair dismissal claim with the associated fee structure. Even if the employee were to win the tribunal case, the compensation cap proposed by the Secretary of State would be considerably lower than the losses that they had encountered.

This is a rogues charter that will result in poorly compensated employees who feel that the system is too complicated and expensive to make a rightful claim for justice. This is compensated no-fault dismissal in action. Let us not mention the ludicrous announcement by the Chancellor at the Conservative party conference that people could give up their workplace rights for a few company shares.

I will quickly run through amendments 92 and 83. In Committee, we pressed the then Minister, the hon. Member for North Norfolk, to introduce a better system for the enforcement of employment tribunal awards. He committed to look at that, but nothing has come forward. As the Minister has said today, some 40% of people who have been found by a judge at an employment tribunal to have been unfairly dismissed never receive their award. I am glad that the Minister is as shocked as we are by those figures and is looking at the matter. I will support her if there is a genuine attempt to make the system better.

Amendment 92 would essentially add to the powers of the employment tribunal to impose a penalty on an employer who does not settle the award within the time specified by the judge. It seems strange that the Government are proposing to fine an employer for aggravated circumstances in order to boost the coffers of the Treasury, while the employee has to wait or gets nothing at all. I am sure that many Members have constituents who have not been paid their compensatory awards.

Amendment 83 would merely remove the provision that introduces a parking ticket-style discount to employers if they pay their fine to the Treasury within the set period of time. That could have the unintended consequence of the penalty being prioritised over the awards due to the employee.

I will move on to amendment 94 and the new clauses tabled by my hon. Friend the Member for North Ayrshire and Arran (Katy Clark). Amendment 94 relates to clause 15, in which the Government attempt to limit the definition of a protected disclosure, which is the basis of whistleblowing claims. Whistleblowing is a day-one right that has the potential for unlimited compensation. The Opposition agree with the Government that this should not be used for an individual’s own employment contract, but we disagree that inserting a public interest test into the legislation will assist in the matter.

The Law Society agrees with us. It has said that the provision should state that a breach of a legal obligation requires something more than a breach of the individual contract of employment, so as to satisfy the public interest test. At present, the provision means that allegations about matters other than a simple breach of a legal obligation must fall within a test of public interest. A disclosure that a criminal offence has been committed would therefore also have to satisfy the public interest test.

We propose that the legislation be altered to omit an individual’s employment contract from whistleblowing claims, unless it satisfies the public interest test. One reason why the Government have got it wrong on this matter is that there has been no consultation with the relevant parties and stakeholders on how best to achieve the goals that we want to achieve.