Growth and Infrastructure Bill

Debate between Jeremy Corbyn and Iain McKenzie

Monday 17th December 2012 Commons Chamber

[Mr McKenzie]

The hon. Gentleman makes a very good point. There are stark connotations for employees across the country if the scheme is put into practice.

[Jeremy Corbyn]

My hon. Friend is making an important point. Does the proposal not indicate the Government’s thinking? They are quite prepared to offer the carrot to many companies that they can simply buy out rights at any time in the future. Next time it might be a cash offer or something like that. We legislate to protect all workers. We legislate for all women to have maternity rights. We legislate for everybody. It is not up to a company or a Government to pick and choose who should be eligible for those rights.

[Mr McKenzie]

My hon. Friend makes a very good point; I could not agree more.

The Chancellor proclaimed that the proposal represented

“owners, workers and the taxman, all in it together,”

but the measure is divisive, goes against the spirit of one nation and risks creating a two-tier labour market across the country.

Offering employee owner contracts, where employees effectively sell their employment rights for shares, is unlikely, if ever, to deliver the highly motivated, engaged work force employers need. Ministers should be making it easier to hire employees, not easier to fire them.

Labour’s jobs plan includes tax breaks for small firms taking on extra employees. Labour supports employee ownership, but not coupling it with slashing employment rights. The US National Centre for Employee Ownership, one of the world’s leading groups promoting share ownership, has also criticised the scheme. The proposal smacks of fire at will. Although Ministers, including the Business Secretary, have claimed they are not going to take forward Mr Beecroft’s fire at will proposals, in practice they are introducing them by the back door. Ministers are trying to introduce the scheme without proper consultation or discussion, or indeed any real support.

The way the scheme will operate in practice and its ramifications are unclear. There are concerns about other ways in which the scheme could have an adverse impact on employees. Will jobs be advertised as being only employee owner and will employers be able to impose the scheme on individual employees or groups of employees? What safeguards will there be to ensure that the scheme is voluntary for existing employees, as Ministers claim?

The clause is a disaster for all, be they employees or employers, and it will not deliver growth in our economy. Businesses that utilise the scheme in recruiting will be recruiting from a smaller pool of talent, which will risk their not being able to take advantage if ever a real recovery comes about.

People giving up their hard-fought employment rights in return for a few shares beggars belief and takes this country back to the dark ages of employment practice. I ask that the clause be dropped.