Draft Employment Rights (Amendment, Revocation and Transitional Provision) Regulations 2023

Justin Madders Excerpts

Tuesday 5th December 2023 General Committees

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

It is a pleasure to see you in the Chair this afternoon, Mr Efford. It is just over a year since we were in these rooms for the Committee stage of what became the Retained EU Law (Revocation and Reform) Act 2023. For those who were not lucky enough to attend those debates—my hon. Friend the Member for Walthamstow was a regular attender—we discussed at length the potential for EU-derived protections to be removed or watered down. During the Committee and on Report, we tabled numerous amendments to seek to protect UK workers from the loss of key EU-derived rights, but we were told that the amendments were not necessary. Indeed, the then Minister for Industry and Investment Security, who led that Bill through Committee—the hon. Member for Wealden (Ms Ghani)—said:

“The Government have no intention of abandoning our strong record on workers’ rights, having raised domestic standards over recent years to make them some of the highest in the world.”––[Official Report, Retained EU Law (Revocation and Reform) Public Bill Committee, 22 November 2022; c. 144.]

These regulations show us that things have not quite turned out like that. As much as the Government might assert that the draft regulations do not constitute a reduction in workers’ overall level of entitlement and protection, we think that the overall effects will see some workers left with fewer entitlements and protections, with many being out of pocket to the tune of hundreds of millions of pounds as a result of the regulations.

There is no doubt that the regulations will have a negative impact, in particular, on irregular and part-year workers, as well as having the potential to impact on the EU-UK trade and co-operation agreement, which contains a non-regression clause on workers’ rights. The Minister said when he opened this debate that he was confident that the regulations complied with the TCA, but will he tell us what discussions he has had with his EU counterparts about these proposals and whether he has received legal advice to confirm that the regulations do not constitute a regression that is actionable under the TCA?

Although we have serious reservations about the impact of the draft regulations, we will not oppose their passing due to the inclusion of some important protections that are being restated from retained EU law. Workers cannot risk losing those protections and we must not put them in jeopardy.

I start with the restated elements. We are encouraged that important principles from the working time regulations and its associated case law will be restated into British law. The right to carry over annual leave when an employee has been unable to take it due to being on maternity or sick leave, and in situations where an employer has failed to inform them of their right to take it, are important principles that need retaining.

Taken in isolation, those protections are undoubtedly welcome, but they are part of a wider package that contains controversial elements that we would never support. That is why it is disappointing that we will not be able to vote on individual elements of the package but will vote on the whole lot. Although we welcome the Government’s U-turn on the original Bill that removed the threat of the automatic sunset on all regulations, there is still a cliff edge on the interpretative effects of retained EU law, and that is coming rapidly into sight.

We have until the end of this month to restate those interpretations because they will no longer apply from 1 January 2024; opposing the regulations outright would risk the loss of those protections.

First I will consider holiday pay, which appears to be most affected by the regulations. Perhaps the most controversial element of the changes is the introduction—reintroduction, should I say—of rolled up holiday pay, which was considered unlawful following the 2006 European Court of Justice decision Robinson-Steele v. RD Retail Services. That interpretation of the law has been replicated since in numerous courts in both the UK and the EU.

Rolled up holiday pay is when workers receive their holiday pay as it accrues as part of their normal wages. That means that a worker receives payment for leave but it does not mean that they are given an express right to take their leave. They are not paid for when they do take time off, so there is a perverse incentive not to take the time off and instead to accrue the holiday pay entitlement.

In practice—this is absolutely clear; there is no ambiguity about this—rolled up holiday pay can be a deterrent to taking time off work. We know how important time off and rest is to a worker’s health and wellbeing and how important it is to maintain healthy and safe workplaces. Indeed, the original directive had health and safety at its heart, recognising that daily, weekly and annual time off were essential for a worker’s wellbeing.

I do not think that ensuring that people have sufficient time off from work ought to be considered a controversial proposition, but the Government have now, in part at least, abandoned that principle. That begs the question of why they have decided to make the changes. It is not as if the consultation that they launched earlier this year showed a resounding support for the move; in fact, 45% of the respondents to the consultation were of the view that the changes should not be introduced. Only 12% registered their support. Given that there is so little support, why have the Government gone ahead and introduced the changes? I suggest that no problem is being solved—there is no overwhelming call for a particular problem to be fixed. This is an ideological move.

The ideological approach is especially true of the proposal in the regulations to place entirely in the employer’s hand whether to allow a conventional paid holiday or rolled up holiday pay for irregular and part-year workers. Why is that the employer’s rather than the worker’s decision? It is clear that the measure will exacerbate the disparity of power in many workplaces. Workers on low pay and who are vulnerable will more likely end up with sub-optimal annual leave arrangements, with very little real power to challenge them. They are also liable to be exploited by employers, who can use the added complexity around the role of holiday pay to make their remuneration less generous. There is a risk that including holiday pay as part of the hourly rate could be presented as an increase in wages or a reason to hold down pay. Owing to the complexity of the arrangement many may not realise that, in receiving rolled up holiday pay, their entitlement to paid time off is no longer there. Has the Minister considered those impacts—particularly given that the regulations also contain looser requirements for monitoring hours worked? What steps will be taken to ensure that low paid workers are protected from exploitation?

The other key change under the regulations is to make annual leave different in respect of the decision made in Harpur Trust v. Brazel, which the Minister mentioned, in 2021. That, by the way, was a UK Supreme Court decision, which secured the principle that all workers are entitled to a minimum of 5.6 weeks’ annual leave per year, to be paid at the ordinary rate of pay.

The Supreme Court specifically rejected the employer’s argument that the statutory minimum paid annual leave entitlement should be calculated on the basis of 12.07% of the annual hours worked. It reinforced the point that statutory minimum paid annual leave does not “accrue” through each annual leave year; rather, the 5.6 weeks’ leave exists to be taken when the worker requests it. It is clear that that decision did not please the Government as the draft regulations have clearly been designed to reverse the effect of the judgment. What is included in the regulations completely undermines a sovereign UK court’s decision—our own Supreme Court, not the European Court of Justice. What efforts will the Government make to assist workers who have difficulty in accessing their full holiday entitlement because of the way the new accrual system will work?

The worst aspect is probably that the Government appear to be focusing on effectively cutting holiday pay entitlement for some workers. The impact assessment calculates that workers could lose up to £248 million a year as a result of reducing the amount of paid holiday accrued by irregular hours and part-time workers. Described euphemistically in the impact assessment as a “transfer to employers” that is an astonishing and strange priority for the Government. We are talking about almost a quarter of a billion pounds a year in cash coming straight out of people’s pockets. Is the Minister proud that his Government are doing that during a cost of living crisis? Is that levelling up? Is that a benefit of Brexit?

Overall, the regulations represent detrimental changes to the rights of irregular hours and part-year workers. One would expect, at the very least, the definitions of those workers to be tighter. However, several stakeholders have raised concerns that the definitions of irregular hours and part-year workers in proposed new regulation 15F are vague and will leave workers and employers uncertain about their rights. One stakeholder called them “a mess” that

“beg more questions than they answer”.

A worker is classified as working irregular hours in the regulations

“if the number of paid hours that they will work in each pay period during the term of their contract in that year is, under the terms of their contract, wholly or mostly variable.”

What “each pay period” means is not clear, and neither is the phrase “wholly or mostly variable”. Who can say whether they work wholly or mostly variable hours? Where is the tightness in that definition? What will the Minister do to ensure clarity about that?

On one reading, the regulations mean that every worker who periodically works paid overtime could be impacted by the changes. Such an interpretation would cause chaos. I hope that the Minister will clarify that in his closing speech. It is equally unclear whether regulations intend to restrict the definition to zero-hours contract workers or whether those on short-hours contracts, whereby a worker has a small number of guaranteed hours with variable work on top, will also be included.

What about those workers who have more than one contract with an employer or do variable hours for part of the year and fixed hours for another part? Will the Minister clarify their position before the regulations become law?

I am afraid that the definition of a part-year worker is not much clearer. I note that the proposed definition excludes workers with annual contracts who are not required to work for parts of the year when they are not paid. Do the regulations mean that the hundreds of thousands of term-time only staff who work for education employers and are paid a salary across 12 months, but for the 39 weeks that they work each year, will not be affected? Again, will the Minister clarify that in his closing remarks?

The draft regulations are inconsistent and appear at odds with existing requirements for the calculation of a week’s pay under the Employment Rights Act 1996. The side-effect of that is important because calculating a week’s pay is necessary for separate employment rights, such as statutory redundancy pay and maternity/paternity pay. The definitions may not be clear, but what is clear is that there will be a great deal of uncertainty. That will almost certainly require further litigation in the courts, which will come at a further cost to businesses and employees and add further strain to an already stretched court system.

The impact assessment suggests that there will be significant savings to business, but does not appear to consider the costs of satellite litigation while the mess is cleared up. If the savings from reducing reporting requirements will really be £1.2 billion a year, why on earth did not the Government take the opportunity to level up holiday pay so that the additional 1.6 weeks could be paid at the same potentially higher rate that the four weeks is paid at?

Even the simple act of equalising the way different elements of holiday entitlement are calculated could have saved businesses money because it would mean that they had to make fewer calculations. It would have guaranteed parity for everyone on all elements of their holiday pay. It would also have been consistent with what our courts said as recently as October, when the Supreme Court, in its judgment in Chief Constable of the Police Service of Northern Ireland v. Agnew and others, specifically held that all paid annual leave, from wherever it is derived, must be viewed as a composite whole and forms part of the same pot. Yet the regulations do the opposite. They not only override UK court decisions, but fail to take the opportunity to level up—something that the Government claim they wish to do for people throughout the country.

The change also ignores the Government’s consultation, which showed that 70% of respondents said that holiday pay should be paid at the same rate. The Minister said that the Government chose not to make that change in response to stakeholders’ concerns, but it is clear from the consultation responses that most stakeholders thought it was a good idea. Why did he take a different view?

Turning to changes to record keeping and the changes to TUPE. Under the current regulations employers must keep adequate records to show that the working time for all workers does not exceed 48 hours a week. Now, the regulations will say, in effect, “You can keep records if you like, but you don’t have to.” Making sure that employers keep these records is already an issue—the impact assessment found that 26% of businesses do not formally record the working hours of their workforce—and enforcement is so pitiful that the Health and Safety Commission records only one prosecution in respect to this since 2007, despite the labour force survey showing that, since 2012, the proportion of night workers working over eight hours per day has risen from 40% to 50%—again, beyond the legal maximum. It is clear that workers are not being adequately protected now, so it seems perverse in the extreme to weaken protections further by removing these reporting requirements.

The proposals also contradict the 2019 judgment in Federación de Servicios de Comisiones Obreras v. Deutsche Bank, which stated that the employers must have an objective, reliable and accessible system enabling the duration of time worked each day by each worker to be measured. The case held that records must be kept in relation to the right to a minimum daily rest period of 11 consecutive hours in each 24-hour period; the right to a minimum uninterrupted period of rest of 24 hours in each seven day period; and of course the maximum weekly working time limit.

That judgment made it clear that record keeping was, in fact, important for the health and safety of workers, and was not something that could become subservient to pure economic factors. That is surely right. Ensuring that workers are able to work safely is more important than the pursuit of profit. This matters not just in private businesses, but in the public sector as well. The British Medical Association says:

“From the perspective of doctors, it is essential that the daily working hours are recorded to ensure both that doctors are fairly paid for the hours they are working rather than those that are scheduled to work (which are routinely a significant underestimation of how long a doctor will have to work depending on what kind of shift they undertake) and the working hours of doctors do not exceed the contractual and legislative safeguards put in place. Any attempt to undermine the recording of these hours will have a profound, long lasting and damaging impact on doctors and the wider functioning of the NHS. In the context of enduring NHS pressures and the scale of stuff for the staffing crisis, such a change to the recording of daily working hours poses significant risk to staff retention and wellbeing, as well as having a detrimental impact on patient care.”

The BMA also says:

“Without guarantees that the hours they have worked will be accurately remunerated or that they will not be subject to rotas which breach the safeguards that protect them and their patients, more doctors could leave the NHS. The health service cannot afford to lose any more doctors.”

I think we all understand where the BMA is coming from. What discussions has the Minister had with his ministerial colleagues in the Department for Health and Social Care? Is he not a little bit concerned that the BMA says the removal of these records will have

“a profound, long lasting and damaging impact”

on the NHS?

We argue that better enforcement and strengthening of the law to prevent workers from being exploited is needed, not regulations that fly in the face of court judgements. It would be easier to accept the Government’s arguments that these requirements are too onerous for a business were there not already stringent obligations on employers to keep records to show compliance with the national minimum wage. It seems clear to me that putting in requirements to ensure that workers are not overworked would not only have health and safety benefits, but would lead to a productive and happier workforce. Would businesses not prefer alternative ways of monitoring the hours of their employees? Did the Government consider any other approaches? If they did, I would be grateful if the Minister told us what other approaches were considered before this decision was arrived at.

Finally, as if that were not enough change to be included in one piece of secondary legislation, we also have a few provisions to amend the TUPE regulations. Under existing rules, in advance of a transfer of a business, the current employer and new employer need to inform and consult with the affected workers’ existing representatives—typically trade union reps—or arrange elections for representatives. For the record, I refer to my entry in the Register of Members’ Financial interests and my trade union membership. There is an exemption from this requirement already in place for businesses with fewer than 10 employees if there are not already representatives in place, but as the Minister outlined, this will now be extended to larger businesses: specifically, it will change the collective consultation requirements of businesses that employ fewer than 50 employees where a transfer affects fewer than 10 people. We have concerns about that.

We know how lax the Government have been about consultation requirements in other areas of the law, and I need not remind the Committee of the fact that some 43,000 employers have resorted to fire and rehire in recent years. We are also concerned about the way in which this will shift the balance of power during transfers, self-evidently placing more power in the hands of employers, which are clearly far better resourced than workers in these situations.

Transfers are a stressful and fearful time for employees in the business being taken over. They are likely to be worried about the potential for their position being abolished or the terms of their contract being changed, all the while feeling helpless that they do not have a collective voice to represent their interests. We do not think that the requirement to seek volunteers to fill the role of representatives is onerous or complex. On the contrary, consulting with individual workers can actually be far more complex and challenging. The changes encourage employers to move away from best practice, and do not assist good employers, which want to hear from their workforce. Instead of having questions and issues funnelled through a representative. They will now have to cover these issues for all individuals. In the circumstances, it is hard not to conclude that this simply represents another attack on collective workplace rights.

I will end there, Mr Efford, because I know that in a similar Committee last week, we did not leave enough time for the Minister to respond. I hope he has sufficient time today to address some of our concerns.

--- Later in debate ---

[Kevin Hollinrake]

I thank hon. Members for their valuable contributions.

We have been clear throughout the Brexit process that we have no intention of abandoning our strong record on workers’ rights, having raised domestic standards over recent years to make them some of the highest in the world. The shadow minister always talks about the impact on workers—today, the impact on irregular and part-year workers. In our debates last week and today, I noticed that Opposition Members never once mentioned the rights of businesses or protections for businesses. It is always workers. Does the hon. Member for Ellesmere Port and Neston not understand that there is a balance to be struck between the rights of workers and the rights of businesses? I never hear Members of the new “party of business” taking the needs of business into account. Why does that never feature in any of his remarks?

[Justin Madders]

We do support business, but every time this Government bring forward legislation, it is about attacking workers. Is it not the same today? Is not taking £250 million out of workers’ pockets an attack on workers?

[Kevin Hollinrake]

I do not accept that. Again, that speaks to the fact that the only organisations quoted in last week’s debate and today’s are the unions, such as the BMA. But I think what the if I can deal with his point, if I may, I think the

On the hon. Gentleman’s point about part-year workers, there is no doubt that there is a £150 million saving for businesses, but he also talked about parity, and this is about parity. It is about two workers working in slightly different patterns but working the same hours every year having the equal amounts of holiday pay. That is what this is. Many people would consider the judgment that led to a difference to be unfair, a perverse outcome. What we’re legislating for here is fairness across the board, whether people work a part-year or a full year.

[Kevin Hollinrake]

It is quite the opposite. We do not pick a side; we try to help both sides and to achieve a balance. That is where we are. I never hear about that balance between both sides from the Opposition; all I hear is about the impact on workers and on unions. In the debate last week, not once did I hear once about the 4 million working days lost to strikes, the 2 million operations cancelled, the hospital appointments cancelled, or the £3.5 billion impact on the hospitality sector.

[Justin Madders]

Was the Minister not listening when I when I talked about how having a different holiday pay calculation rate for the four weeks and the extra 1.6 was actually going to create more burden on businesses?

[Kevin Hollinrake]

The hon. Gentleman raises an interesting point. He is talking about a single pot of annual leave. We believe in maintaining two pots. Presumably he is talking about the four weeks at normal pay currently and 1.6 weeks at basic pay, and about raising the 1.6 weeks of basic pay to the level of normal pay, which actually costs employers more. How much more is he suggesting employers should pay to regularise that position?

[Justin Madders]

Can the Minister give us a figure for how much more this would be?

[Kevin Hollinrake]

It is incumbent on the hon. Gentleman to do that. We are maintaining the status quo. He wants to make that change. What is the figure for what he describes as a simpler position? Does he not agree that that would be a cost on business? It is simple as that, yet he throws that out as if it were no matter for employers, who would have to deal with the extra cost.

[Justin Madders]

The Minister pointed out that, apparently, this will save businesses £1.2 billion. I don’t know if that is more or less than the change would cost, but I would have thought that it is something that could have been looked at, yet it does not appear to have been considered at all.

[Kevin Hollinrake]

I think we are back to the same place. As the hon. Gentleman knows, the £1.2 billion is largely the administrative costs of maintaining a recording position. What he wants to move to would cost a cost employers £1 billion. That is an interesting point.

Raising concerns that I think are scaremongering, The hon. Gentleman said that in future employers would be able to keep records “if they like”. That is not the case, and he knows that. Why would he say that kind of thing? Employers are required to make and keep adequate records. He knows that from the legislation. He also raised some concerns about change expressed by one of the unions, but it is not a change, because these measures have not yet been implemented in the UK economy. Again, he raises those concerns that somehow this is detrimental to health workers, but that is not the case. Does he accept that?

In terms of the points on rolled up holiday pay raised by the hon. Gentleman and the hon. Member for Walthamstow, the Government believe the existing safeguards are proportionate in addressing current concerns about impacts on workers from rolled up holiday pay. Employers are already required to provide an opportunity for workers to take leave, and we have heard through our stakeholder engagement that this is taking place. We also have safeguards in relation to the 48-hour working week, where a worker cannot work more than 48 hours a week unless they choose to opt out.

In terms of consultations, employers will have to tell their workers if they intend to start using rolled up holiday pay, and this payment will have to be clearly marked on the worker’s payslip. If employers need to make changes to terms and conditions, they must seek to reach an agreement with their workers or their representatives.

I think I have covered most of the points raised—I am sure I will be told if I have not. Our standards and our workers’ rights were never dependent on membership of the EU—indeed, the UK provides stronger protections for workers than are required by EU law. For example, we have one of the highest minimum wages in Europe, and on 21 November, the Government announced that we will increase the national living wage for workers aged 21 and over by 9.8% to £11.44 an hour. That will certainly help the hon. Lady’s constituents, some of whom may be low paid, as she said.

Our regulatory system is recognised globally, but we want to raise the bar even higher and deliver on our ambition to become the best regulated economy in the world, as we embrace our newfound freedoms outside the EU. By doing so, entrepreneurial businesses will have more opportunity to innovate, experiment and create jobs, and importantly, workers’ rights will be protected. This will cement our position as a world-class place to work and to grow a business.

Oral Answers to Questions

Justin Madders Excerpts

Thursday 30th November 2023 Commons Chamber

[Mr Speaker]

I call the shadow Minister.

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

Fire and rehire is rife in this country. Research published by the Chartered Institute of Personnel and Development found that, between March 2020 and July 2021, 43,000 employers changed their employees’ contracts through fire and rehire techniques. The Government promised in March 2022 that they would take action following the P&O scandal, and we now learn that it will be a full two years since that time before anything actually changes. Given the propensity for using fire and rehire tactics, can the Minister tell us how many employees he estimates will have had their contract changed through fire and rehire in that two-year period?

[Kevin Hollinrake]

I do not have that number to hand. We want to strike a balance between employers and their workforces. We condemn what P&O did. We need to bring in new measures on fire and rehire, and we have committed to do that. A consultation is clearly needed to make sure those provisions are fair on both businesses and workers. That is what we are doing right now, and we intend to bring those provisions before the House next spring.

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

Justin Madders Excerpts

Monday 27th November 2023 General Committees

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

It is a pleasure to see you in the Chair this afternoon, Ms Nokes. I draw the Committee’s attention to my membership of the GMB and Unite trade unions.

I thank the Minister for his introduction. However, it will come as no surprise to him that the Opposition will oppose the code of practice. He described it as controversial, which is an understatement. We remain clear in our view that the Strikes (Minimum Service Levels) Act is fundamentally unworkable and places undue limitations on an individual’s freedom of association. These freedoms have been fought for and won over many decades, and they deserve much better than to be chipped away and undermined in the way that we see before us today. Labour has promised to repeal the legislation when we get into government, and we stand by that pledge.

“Reasonable steps” is a pivotal phrase that jumps out at anyone reading the Act. It stands out so much not only because it is vague and is left undefined in the primary legislation, but because the phrase’s definition carries hugely punitive consequences for those who get it wrong. It determines whether a union’s actions could leave it liable to proceedings in tort for sums that would be likely to bankrupt it. It could also see an individual worker’s protections against unfair dismissal removed. Those are not issues that as legislators we can ignore.

How “reasonable steps” is defined is a fundamental part of the legislation. As the Bill progressed through the House, we repeatedly asked for greater clarity as to what it meant. Time and again, we asked what constituted “reasonable steps”. In response, all we got from the Minister was that it would be for a court to decide.

[Richard Burgon]

My hon. Friend and I have many things in common, one of which is that we were both trade union lawyers, which Government Members perhaps think are not a good thing. Why are the Government so keen to give so much business to employment lawyers? The code of practice’s use of the phrase that my hon. Friend has just mentioned—“reasonable steps”—is a lawyer’s dream, whether they be on the employer’s side or the workers’ side. In legal libraries across the country, there are fat books of case law to determine what is and is not reasonable in various employment situations. The code is a recipe for further clogging up the courts, and it will cost further money for both trade unions and employers. Does my hon. Friend agree that it is absolutely ridiculous?

--- Later in debate ---

[Justin Madders]

Yes. We both have some industrial experience of how this works, so we can see what is going to happen. There has been no regulatory impact assessment for the code of practice. If there had been, it would have produced some eye-watering numbers on what it will mean for legal costs not just for trade union members, but in the end for the taxpayer, because a lot of the disputes will involve public sector employers.

During the passage of the Bill, the Minister’s refrain was that it is for the courts to decide, but even after the code of practice is issued, it will still be up to the courts to decide. There are still so many ambiguities and unanswered questions. The fact that we had to vote on such an important piece of legislation without any clarity about what “reasonable steps” meant shows that this debate is taking place 10 months too late. As elected legislators, we really should have known what this all meant before being asked to vote on a Bill that was passed into law. That is no way to go on, and it is by no means the only example of this Government rushing through legislation without an adequate opportunity for scrutiny.

Let us be honest: we were told at the time that there was an urgent need for this legislation, and that it needed to be rushed through a Committee of the whole House in just one day. That was back in January. We are now in November, so in reality we could have had a proper Bill Committee stage and evidence sessions in which these issues were properly debated and voted on. Will the Minister tell us whether the rush at the start of the year was because the Government did not want scrutiny of the Bill? Or was it because they were making it up as they went along?

The provisions before us are at odds with expectations about what the Act was meant to deliver. The code of practice does not alleviate any of our concerns about the workability of the legislation. Actually, it adds more levels of concern, complexity and ambiguity. It contains provisions that go well beyond what was discussed and included in the Act, and it contains language that is at odds with ministerial comments at the Dispatch Box. Many important elements are left undefined, presumably for the court to pass judgment on at some point—not to mention the inconsistencies in the code’s guidance, which I will come on to. Unreasonable expectations are also being placed on unions to police the behaviour of their members, and there are excessive diktats on the language to be used in communications between a trade union and its members.

The Minister says that measure has been produced as a result of consultation, but we know that most of the employers’ organisations, never mind the trade unions, think that this is a complete mess. The reason why it is still before us today shows us everything about where the Conservative party is coming from with this legislation. The document deliberately defines the phrase “reasonable steps” in a way that is designed to infringe on a trade union’s actions to a degree that is not in line with the Act’s stated policy aim, which is to reduce disruption during strikes. Put simply, we believe that the code seeks to further restrict the right to strike and limit the lawful actions of trade unions during a period of industrial action.

Turning to the first recommended step—the “identification of members”—it is clear that the interpretation that the code offers is unduly burdensome on unions. It imposes tight deadlines and has the effect of creating confusion. That is before we look at whether this can be done in a GDPR-compliant manner. The Minister did not really address the concerns that several hon. Members raised about what happens in a workplace where more than one trade union is recognised by the employer. Of course, that is quite commonplace.

Paragraph 19 is the most important part of this section of the code of practice. It states:

“Unions should begin identifying their members who are subject to the work notice as soon as reasonably practical after receiving a work notice”.

That means that with potentially as little as seven days’ notice, a union would have to comb through a list—most likely just a list of names—and pick out its members who could be involved in a particular industrial dispute. But not only that: due to an employer’s right to vary a work notice up to four days prior to strike action, that work could be in vain. I will return to that issue shortly. To me, this responsibility seems particularly onerous. We should remember that the sectors in which work notices can be introduced have vast workforces and can be national in scope. It is quite possible that an industrial dispute could involve hundreds of thousands of workers across the country and potentially impact hundreds of different workplaces.

For example, the RMT has highlighted that during a multi-train company dispute, similar to the one that has taken place over the past 18 months, a number of employers could send more than 10,000 names, comprising 100 different grades working at 100 different locations. To provide unions with a matter of days to sort through such an expansive list and identify which members could be impacted by the strike is an enormous undertaking. I am sure that if such an obligation was placed on a business, Ministers would be jumping up and down about all the extra red tape, but we know that this Government do not judge trade unions by the same standards.

One could even take the view that this expectation is designed to be completely impossible, especially given that there is no guarantee that employers will provide defining characteristics alongside the names. That means that the union may not be able to differentiate between two people with exactly the same name or a similar surname, for example. The guidance addresses that by stating that unions “may wish” to engage with employers ahead of strike action on how work notices can be designed to avoid that. That will depend on employers’ co-operation, although, as we have heard, they will be subject not to a statutory code of practice, but to non-binding guidance, which gives us no guarantee that they will co-operate at all.

What steps will the Minister take to address that? Will action be taken against employers that fail to engage with unions to help them to differentiate workers? How will the Minister ensure that any union conducting strike action in the short term will receive work notices that allow them to differentiate names on the list? Will they be offered dispensation if they are unable to identify any workers within a very tight deadline?

Paragraph 20 of the code offers guidance on employers’ ability to vary work notices at four days’ notice. It is hard to understand how that provision could not be deliberately designed to cause confusion and undermine trade unions. What will happen if an employer varies a notice over a bank holiday weekend, or even at Easter, when there is a bank holiday either side of the weekend? Are trade unions expected to have people perpetually on call during such periods just in case another notice is issued? The code makes no mention of bank holidays and weekends, so might a union be asked to respond to hundreds of varied work notices at two days’ notice—or even one day’s notice—with no leeway given?

[Neil Coyle]

If employers are not compelled to share information, is this dog’s dinner of legislation even remotely workable?

[Justin Madders]

The overwhelming response to the consultation on the measure, and to that on the original Bill, was that the process will be very difficult in practice. That is because it is not about providing minimum service levels, but about trying to stop trade unions from exercising their lawful and democratic right to take industrial action.

The instruction at paragraph 25 of the code of practice that a union should send its compliance notice to its members “by electronic means” is the biggest irony in all this, because the Government have sat on a review on e-balloting for industrial disputes for some five years, yet made no attempt to implement it. Does the Minister finally accept that it might be reasonable to allow trade unions to enter the 21st century, with industrial action communications sent by email? Does he accept that that should include the actual balloting for industrial action? It is inconsistent, to say the least, that the code of practice specifically instructs unions to contact members about industrial action electronically, yet the law specifically prohibits them from balloting their members by email. I know that the Minister has had a lot of practice in e-balloting from his party’s leadership contests, so does he now accept that it should be possible to ballot trade union members on industrial action electronically?

Paragraph 25 further states that

“if the union is aware that any member will be unlikely to access electronic communications before the…strike”

it should send notice by “first class post” instead. What on earth does that mean? Is a union to require a read receipt from every member to form a view of whether they are likely to access their emails? Does the Minister realise that even four days’ notice would be asking rather a lot of Royal Mail, leaving aside bank holidays and weekends, because the latest stats on the delivery of first-class mail show that it is well below its performance targets?

The most problematic aspect of the code is probably paragraph 20, given its provisions on varying work notices. Anyone tasked with ensuring that all the right members are contacted within the incredibly tight timescale of seven days will experience a logistical nightmare, and that would only be exacerbated by the option of amendment only four days out.

Sadly, the provision leaves the door open to employers to deliberately and purposefully issue erroneous work notices in the first instance, only to vary them closer to the relevant date with a view to undermining industrial action. Members should not forget that “four days before” can start at 11.59 pm on the relevant day, effectively leaving three days. While the motivation might not be malevolent—it could be due to negligence—the practical effect of the requirement will be that a union would be expected to contact an employee to encourage them to attend work on the day of a strike, but then say to them a couple of days later, “Actually, you don’t need to attend,” while telling a whole new set of people that they need to attend. It is not hard to see how that could be abused to create an air of confusion on the part of the worker as to whether they are meant to be on strike or at work. When the consequences for making a mistake are so great, it is understandable that a worker would be likely to err on the side of caution and attend the workplace. Of course, all the energy and time expended on deciding who needs to get a notice and who does not could be spent on trying to resolve the dispute.

All those problems are compounded by a contradiction in the code of practice. Paragraph 19 indicates that, under the duty, a union is expected to take reasonable steps to contact members included in a work notice as soon as is “reasonably practical”.

[Mick Whitley]

Does my hon. Friend share my confusion about why the onus for communicating with members who have been named in work notices has been placed on unions, rather than on employers, which routinely communicate with their employees as a matter of course? Does he also worry, as I do, that given the difficulties that unions often encounter in contacting members, the measure greatly increases the likelihood of workers being subject to disciplinary action and even dismissal?

[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.

[Several hon. Members rose—]

Regulatory Impact Assessments Bill

Justin Madders Excerpts

2nd reading
Friday 20th October 2023 Commons Chamber

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

I thank the hon. Member for Christchurch (Sir Christopher Chope) for introducing this Bill. This has been a wide-ranging debate that has covered a whole range of topics, but it is, at heart, about accountability for Government decisions, and it is clear that there are concerns about that.

It is worth drawing the House’s attention to the report of the House of Lords Secondary Legislation Scrutiny Committee of 10 October 2022, entitled “Losing Impact: why the Government’s impact assessment system is failing Parliament and the public”. I know that minds were probably elsewhere around that time last year, but it is a very important report, and it draws on many of the points that have been raised today. The executive summary of the report said:

“In 2017, we noted that there had been some improvement in the quality of Impact Assessments (IA) provided with secondary legislation. Unfortunately, this improvement has not survived the dual challenges of Brexit and the pandemic, during which time the speed of legislating meant that corners were cut. We had hoped that the return to more normal working would provide an opportunity not just to reinstate the previous IA system but to improve it: this has not happened.”

To pick up on the points raised by the right hon. Member for Tatton (Esther McVey), as the shadow Health Minister at the time I spent an awful lot of days on the Committee corridor opposite the right hon. Member for Charnwood (Edward Argar). Unfortunately, he is not here now, but I am sure he will recall fondly a number of occasions on which we drew to his attention the fact that many of the regulations introduced under the Public Health (Control of Disease) Act 1984 had no impact assessment and very little information to back up the decisions that had been made. We understood at the start of the pandemic why that was not always possible, but as time moved on, it felt that that was a pattern that did not have any justification. This matter is not limited to public health regulations.

[Esther McVey]

Does the hon. Member agree that we need to change the 1984 Act so that we do not bypass the House and go into lockdowns without full scrutiny by all Members of this House?

--- Later in debate ---

[Justin Madders]

I would like to wait and see what the inquiry says about the way that that was handled. An awful lot of evidence has been given about Government decision making at the time, which it makes clear was less than ideal. It is probably best for us to wait and see what comes out of the inquiry on how we as a Parliament can best deal with these issues in future. Hopefully that situation will never repeat itself, but the hon. Member for Shipley (Philip Davies) made the point that the solution to many of these challenges lies in Members robustly challenging Government when opportunities arise.

The House of Lords Committee said that an impact statement

“should not just be treated as an item on a ‘to do’ list but be an integral part of the policy formulation process… One of our major concerns is that IAs which are published late, or that appear to have been scrambled together at the last minute to justify a decision already taken, may undermine the quality of the policy choices that underpin the legislation.”

Again, that theme has been picked up in the debate.

[Kevin Hollinrake]

Reflecting on that particular statement, does the hon. Gentleman think his party was wrong to call for longer lockdowns on the basis of no evidence in cost-benefit analysis?

[Justin Madders]

That is a bit rich from a Minister of a Government who did not introduce any impact assessments when they first brought in the lockdowns or various restrictions. I can recall on numerous occasions asking Ministers why people were limited to being in groups of six or why pubs had to close at 10 o’clock. We never got a satisfactory answer to any of those questions, so for the Government to try to put that on us is a little rich.

[Esther McVey]

The hon. Member has just said to the House that he did not have sufficient answers for the rule of six and the 10 pm curfew. Does he not think it curious that Members, except for a handful of us here, still voted for them? Even he went along with it and voted for them.

[Justin Madders]

We are not going to relitigate the entire pandemic here, but it is very important to say that the Opposition’s position was to support the Government in trying to get on top of the pandemic. I think it is fair to say that, while we did that, we were concerned there was not always the evidence to support some of the Government’s policies. We took it on trust that they had those conversations with the Scientific Advisory Group for Emergencies and so on, but again, I think those things—the level of detail and the consideration taken before recommendations came forward—will come out during the inquiries.

To pick up on another point from the Lords Secondary Legislation Scrutiny Committee recommendations, it said:

“Our concern is that the number of qualifying instruments which have not followed the IA”—

impact assessment—

“procedure has increased and, given that no sanctions appear to be applied where a department fails to comply, there would seem to be little incentive for departments to improve.”

Obviously, the Bill would create an incentive in the sense of bringing a Minister here every three days to answer for the lack of an impact assessment when one is not produced. As much as I enjoy seeing the Minister, I do not think it would be a particularly good use of parliamentary time to have him come here every three days to explain why an impact assessment had not been prepared. It would probably create an unnecessary pressure to produce one in a rushed manner that might not actually be fit for purpose. On that point, the Minister referred to the Regulatory Policy Committee, which does a kind of audit of impact assessments. It has said itself that around a quarter of all impact assessments are not fit for purpose. If we are to rely on the RPC for approval of the way impact assessments are delivered, we ought to listen to its recommendations a little bit more. They are not always as glowing as we would like.

I will not detain the House any longer, but some important points have been raised.

[Sir Christopher Chope]

On the hon. Member’s last point, if he accepts that the system is not working, what does he think should be the sanction for failing to ensure that it does work?

[Justin Madders]

The answer lies in Members’ own hands. It is up to Parliament itself to object to or vote against legislation if it does not think the impact assessments support the policy direction. The powers have always been there. Members can turn up to any secondary legislation Committee if they wish to. I understand the thrust of what the hon. Member is saying with this private Member’s Bill, but I am not quite sure it is the right method to deliver it. What needs to happen is for the Government to instil from day one a commitment to evidence-based decision making. There have, I am afraid, been too many examples recently where that has not happened.

Worker Protection (Amendment of Equality Act 2010) Bill

Justin Madders Excerpts

Consideration of Lords amendments
Friday 20th October 2023 Commons Chamber

[Danny Kruger]

This is an important discussion. The hon. Lady is saying that the law is a teacher—indeed, it is—and influences the culture. It is also true that the law needs to reflect the culture, so we modernise our legislative framework in response to public opinion and how things are. We now legalise things that were illegal in the past in response to the way culture evolves.

However, the law is a teacher in a bad way too. It can introduce negative effects into our culture and chill free speech. It can inhibit the sorts of conversation that are necessary for the development and progress of our society, which is a topic that will come up later in other legislation. There were significant attempts during the pandemic to effectively criminalise or inhibit free speech around the pandemic response, on exactly the same grounds that we might use in this debate, namely that it is important for public protection and the protection of the vulnerable that misinformation, disinformation and, in this context, harassment should be criminalised. That was wrong, and I really worry about the possible chilling effect of this legislation.

A narrow gap is left in this law to criminalise free speech. Many Members will raise the outrageous and unacceptable behaviour that many employees have to put up with in the workplace—I recognise that too. We absolutely need to insist that that does not happen, but that is a job for the culture and for employers. In a sense, it is a job for all of us to instil the right sort of moral conduct in our communities, but frankly it is impossible to write legislation in black and white that achieves the outcomes the hon. Lady wishes without also inhibiting free speech.

I will end with an observation about another piece of legislation that I understand is being contemplated for the King’s Speech: a conversion therapy ban. I am afraid that that is another instance where, under the noble and honourable impulse to stop outrageous and unacceptable practices going on, we are proposing a piece of performative legislation in response to a vocal and activist lobby group that will put into law an imprecise and fuzzy set of moral aspirations. Once Opposition Members get hold of it in Committee, on Third Reading and in the House of Lords, the scope will be expanded and then courts will be required to criminalise conversations between adults and their therapists, parents and children, which is exactly what happens in other countries where this well-intentioned legislation has been passed into law. The law is a teacher, but it is not an opportunity for moral grandstanding and virtue signalling. We have an obligation to put into black and white words that the courts clearly understand and that do not end up curtailing free speech.

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

It is a relief that we have this Bill back here today, given that it was reported earlier in the year that it was likely to be shelved, possibly because of the backlash we have just heard. The Bill has come back from the other place, albeit heavily amended, and it still represents a step in the right direction, albeit a very small one. The hon. Member for Bath (Wera Hobhouse) has done a sterling job in getting this Bill through the Parliamentary maze. She has been extremely gracious and generous in her comments today, given what is left in the Bill. I think it is a fine description to say that it has been narrowed in scope. Alternatively, it could be described, as the hon. Member for Devizes (Danny Kruger) has just done, as having had the guts ripped out of it. I know which description suits what has happened better.

--- Later in debate ---

[Justin Madders]

Yes, that is absolutely right. The Equality Act is framed in such a way that it protects everyone from harassment on the basis of their sex. I think that we now have a Bill that, after the amendments, to our regret will not protect workers from third-party harassment. The duty to take all reasonable steps has now been reduced or watered down to taking reasonable steps. We are disappointed that the Bill returns in a form that looks very different from what was originally passed by this House. It seems that the original good intentions of the Bill have—to use the terms of the hon. Member for Devizes—been “gutted”, and I am sorry to say that seems to have been with the support of the Government. Let us not forget that, when the Bill passed through the Commons originally, it did have support from the Government and it also had cross-party support, which is a rarity these days. Therefore, it is extremely disappointing that the democratically elected House seems to have given in to the unelected Lords, seemingly with the endorsement of the Government.

I have to say that the Government’s decision to support the Lords amendments that have taken the guts out of the Bill is frustrating, given that the Bill was enacting pledges that the Government had made.

[The Minister for Women (Maria Caulfield)]

Does the hon. Gentleman not recognise that this is the Bill of the hon. Member for Bath (Wera Hobhouse) and it is up to her to decide which amendments she does or does not accept? The Government have fully supported the hon. Lady. This is not a Government decision; it is part of the parliamentary process.

[Justin Madders]

I thank the Minister for her comments. The Government have a majority, so if they wanted to keep the Bill in its original form they could have ensured that it passed. Let me quote what she said at Committee stage. She said that

“the Government committed to a package of new measures aimed at reducing incidences of workplace harassment. That includes the two legislative measures being brought forward in the Bill: explicit protections for employees from workplace harassment by third parties, such as customers and clients; and a duty on employers to take all reasonable steps to prevent their employees from experiencing sexual harassment.”––[Official Report, Worker Protection (Amendment of Equality Act 2010) Public Bill Committee, 23 November 2022; c. 10.]

[Wera Hobhouse]

It is true that I have accepted the Lords amendment. Indeed, it was ultimately me who proposed that we should go all the way in order to preserve one thing that I find incredibly important, which is the preventive duty on employers. Does the hon. Member not agree that this is an important step and for that reason it is right that I accept the Lords amendment?

[Justin Madders]

I accept what the hon. Member says. We will certainly not oppose the Bill, but we do have to challenge the Minister on why she has changed her mind, given that, last year, she said that the measures in the Bill

“continue to form a key part of the Government’s national strategy for tackling violence against women and girls.”––[Official Report, Worker Protection (Amendment of Equality Act 2010) Public Bill Committee, 23 November 2022; c. 10.]

Why have the Government decided to change their mind on it? It seems to me that they have folded to pressure from their Back Benchers. Let us not forget that the Bill came about as a result of an extensive Government consultation, which received more than 4,000 responses.

[Philip Davies]

It is not necessarily for me to come to the Government’s defence here, but I think the hon. Gentleman is tying himself up in knots with his argument. The amendment was passed in the House of Lords. He will have noticed, I am sure, that the Government do not have a majority in that House, so they cannot be held responsible for an amendment passed in it. If the Government had done as he asked by overturning the Lords amendment, the Bill would have fallen altogether, so I am not entirely sure what he is arguing for.

[Justin Madders]

I am sure that the hon. Member is aware that we vote regularly on Lords amendments in this place, and that the Government use their majority to overturn them. The point that I am trying to make is this: where does this leave Government policy on the issue? The Fawcett Society found that 56% of women working in the hospitality sector, and 47% of those working in the services industry, have faced sexual harassment in the workplace. What will the Government do about that?

[Philip Davies]

If the hon. Gentleman wished to press the matter to a vote as a point of principle, he could vote down the Lords amendment. I am sure that my hon. Friend the Member for Devizes (Danny Kruger) would be delighted if he did, because in doing so he would guarantee that the whole Bill fell. Is that really what he wants?

[Justin Madders]

No, that is not what I want, which is why I have said that we will not oppose the amendment, but we are still entitled to express our disappointment about the capitulation. The Equality and Human Rights Commission’s 2018 report found

“a quarter of those reporting harassment saying the perpetrators were third parties”

and that third-party sexual harassment was dealt with poorly and considered

“a ‘normal’ part of the job”

by some employers. I do not think that is a situation that we should defend. Let us be clear: we would not have objected to the Bill if that had been in place—we certainly would have supported it—but we will support it as it stands because, as the hon. Member for Bath said, it is an important step in the right direction, albeit a much smaller step than originally intended.

The question remains: what is the Government’s plan to deal with third-party harassment? If they will not bring forward a legislative solution, what do they intend to do? If there were a repeat of the scenes at the Presidents Club tomorrow, what would be the consequences for the perpetrators? We need answers to those questions.

Despite the removal of the word “all” from the Bill, the duty to prevent sexual harassment is, as the hon. Member for Bath said, a new duty that represents a positive step forward. Establishing that preventive duty will shift the emphasis away from a reliance on individuals reporting harassment to employers and will encourage employers to take preventive steps. We are optimistic—we can be—and hope that the Bill will drive structural change by fundamentally shifting the responsibility from the individual to the institution, but what that will mean in reality and how much capacity the EHRC will have to investigate complaints remains to be seen. Its responsibility to create a statutory code of practice should mean that the focus will be more on working with employers. Does the Minister have any information on when she expects that statutory code of practice to be published, should the Bill be passed, and will it draw mainly from the non-statutory code of practice that has already been produced?

We believe that everyone should be able to go to work safe from sexual harassment, knowing that their employer has taken steps to create a safe working environment. That is why a Labour Government would go much further than the House has today.

[Maria Caulfield]

I congratulate the hon. Member for Bath (Wera Hobhouse) on progressing this Bill, which tackles the important issue of sexual harassment in the workplace. I thank her for the pragmatism she has shown to ensure that the Bill can progress with agreement from across the House. It is slightly disappointing to see the shadow Minister, the hon. Member for Ellesmere Port and Neston (Justin Madders), take such a partisan approach, because the Bill has had cross-party support throughout all its stages.

It is often very difficult for private Members’ Bills to pass through this place, but the Government have fully supported the Bill, because it is such an important issue to tackle. We have especially made time for an additional sitting Friday, to ensure that the Bill passes. We remain committed to tackling sexual harassment in the workplace by introducing the employer duty, to strengthen protections in the Equality Act 2010.

While I note the concerns from my hon. Friends the Members for Southend West (Anna Firth) and for Devizes (Danny Kruger), I am very pleased that consensus has been reached here and in the other place, and I hope Members will agree that this important Bill should now be on the statute book. I would like to particularly thank my hon. Friend the Member for Devizes, who has some genuine concerns about the Bill that he has expressed today and at previous stages.

This is a difficult subject. While there may be differences in views and opinions, I am really pleased that the hon. Member for Bath has been able to progress the Bill through both Houses, because we need to make our workplaces better and safer. That is particularly true for women. We have heard recently about some of the experiences of female surgeons in the healthcare system. With my other hat on as a Health Minister, I am particularly pleased that this legislation will hopefully prevent some of those experiences in future.

I turn to the Lords amendments. Lords amendment 1 leaves out clause 1, to remove the proposed liability of employers for third-party harassment in the workplace. I am glad to hear that the amendment to remove this third-party harassment liability eases concerns that it could have had a chilling effect on free speech in the workplace. I am pleased that that has been addressed. There are some—I know the hon. Member for Bath is one of them—who are disappointed that the amendment has removed the third-party harassment liability, for very valid reasons, but this is about getting a compromise, so that we get the majority of the measures in the Bill through this place.

The Government believe it is important that workers are protected against this form of harassment, and good employers are already taking steps to ensure that their employees are protected from harassment by third parties, regardless of the legal position. However, to progress the Bill, we have had to be pragmatic, acknowledge the complexities at play and find a suitable balance. While we want to strengthen protections, we also do not wish to infringe on individuals’ rights to freedom of speech. Everyone has the right to their views and to debate them just as we are doing today, respecting others’ views in the process. The aim of the Bill is to tackle workplace harassment and not limit people’s freedoms. It is important to remember that, despite the removal of the third-party harassment provision, the Bill will still introduce a new duty on employers to take reasonable steps to prevent sexual harassment.

The Government’s priority is to ensure that the legislation works effectively. We have consistently consulted with a wide range of stakeholders and have listened to all their views. As my hon. Friend the Member for Southend West has consulted with her chamber of commerce, the Government have done so more widely. When concerns regarding the potential chilling effect on free speech were first raised as the Bill progressed through the Commons, the Government took on board those issues. It was feared that employers may take unreasonable or drastic measures to avoid liability for harassment of their staff, particularly by third parties, to the extent that they would feel obliged to shut down conversations in the workplace. While employers will be expected to take action against workplace harassment, we recognise that those actions should fall short of prohibiting conversations. Free speech is crucial to our way of life, and it is important that we found a way forward.

With over 40 amendments tabled to the Bill in the other place following its Second Reading on 24 March, even after the Government tabled their amendment, it was clear that there remained concerns that the Bill would still have a chilling effect on free speech. The Government took those amendments very seriously, as they were fatal to the Bill. In our engagement with stakeholders and peers, we heard the strong concern, particularly about the third-party harassment issues, so we were eager to find a balance and a way forward for the Bill to reach the statute book with cross-party support. Therefore, the Government have been pragmatic and alive to the issues raised, and consensus was reached with peers by removing all but two of their amendments. The shadow Minister, the hon. Member for Ellesmere Port and Neston, did not comment on the other amendments—over 38 of them—that we managed to get removed.

Non-disclosure Agreements in the Workplace

Justin Madders Excerpts

Tuesday 5th September 2023 Westminster Hall

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

It is a pleasure to see you in the Chair, Ms Ali. I congratulate the right hon. Member for Basingstoke (Dame Maria Miller) on calling this debate; it is an area that she has worked in for a considerable period of time and she articulated very clearly what the problems are and why they need tackling.

There have been a lot of excellent contributions today. My hon. Friend the Member for York Central (Rachael Maskell) brought her vast experience of employee representation to the fore. She talked about having open cultures in the workplace, which is a good way of looking at how this all needs to change. The hon. Member for Oxford West and Abingdon (Layla Moran) made an excellent speech; she made the important point that when someone signs these NDAs, they are not for a month or a year, but for life. As I will go on to explain, that does cause people difficulties later.

The hon. Member for Stoke-on-Trent Central (Jo Gideon) described NDAs as being weaponised, which I thought was a good description. She also said that employment tribunals never tackle the underlying cause of discrimination in the workplace. Of course, tribunals can make recommendations to employers, but we are getting a body of evidence that this is not an effective tool, and that perhaps an enforcement body is needed to look at those issues. My hon. Friend the Member for Birmingham, Yardley (Jess Phillips) brought all of her experience to the fore and gave a truly fantastic speech. She was right to say that this issue is fundamentally about power and its imbalance, which I will come to in my speech.

I do not dispute that there is a need for some non-disclosure agreements. There are sometimes appropriate situations, where they are needed, but I think we all agree that they are far more prevalent than they need to be and are being abused to cover up other issues. In the absence of any data on the numbers of agreements in operation, we are reliant on the legal profession and campaigning groups to give us an idea of what is happening.

Evidence collected by the Women and Equalities Committee and a recent study conducted by the Solicitors Regulation Authority found that there is widespread use of NDAs in the workplace, with little regard given to their appropriateness. In 2019, the Committee said:

“Confidentiality and non-derogatory clauses have become commonly used in agreements reached between employers and employees when settling or closing employment complaints or employment tribunal cases about discrimination or harassment. Indeed, they are commonplace when settling any type of employment dispute.”

The Solicitors Regulation Authority said that

“firms often told us that NDAs are included as standard without consideration of the purpose for including such a clause. For example, a firm commented they were used even ‘when not strictly necessary, where everyone knew the ongoing issue.’”

As a former practising lawyer who has handled thousands of those settlement agreements, I can confirm that NDAs are standard and the attitude of most employers, when challenged on the inclusion of them, is that they are a standard clause and the agreement is presented on a take-it-or-leave-it basis—whether the NDA is necessary or not. The reason they continue is the imbalance in power in the employment relationship. The SRA found that only six of 25 solicitors it interviewed reported even questioning the need for a confidentiality clause. The fact that those drafting them give no particular weight to them is a trend. It is in direct contradiction to the advice given by ACAS, which says that they should only be used where necessary and not as a matter of course.

There are many workers bound by completely unnecessary NDAs at the moment, and when an important industry regulator, such as the Solicitors Regulation Authority, suggests there is a wholesale misuse of a contractual term—one that, as we have heard, can have a profoundly negative impact on workers—there is a good argument to say that the Government need to intervene. It is a good example of where there needs to be more intervention. I echo the question raised by my hon. Friend the Member for York Central, and ask the Minister what work will be done to understand the extent and misuse of these agreements.

It is easy to see why the agreements are so prevalent. The Employment Lawyers Association said clearly that employers are the driving force behind NDAs, as they enable settlement without admission of liability. The employers’ reasoning is simple: why settle publicly when they can wait for a tribunal that might get them off the hook or award a lower amount? That speaks to a wider, more problematic imbalance of power between employers and employees that is endemic in the labour market. In many ways, the proliferation in use of NDAs is both a symptom of, and a tool used to perpetuate, the imbalance of power in the workplace. The Solicitors Regulation Authority—which, let’s be honest, is not at the vanguard of left-wing workers’ rights—described the imbalance of power in the workplace as “fundamental”.

A witness before the Women and Equalities Committee —I think this evidence is very powerful—said:

“There is this very well-founded fear amongst women that, if they talk about having had problems at work, even if their problem is not of their own making, they will be labelled as a troublemaker and they will find difficulties getting new employment.”

Those comments, although made in the context of harassment, could equally apply to a trade union representative or, as the hon. Member for Cheadle (Mary Robinson) said, to a whistleblower or, indeed, to anyone who challenges poor practice in the workplace. That power imbalance affects everyone, across the board.

One of the most troubling findings in the Select Committee report was the culture that NDAs perpetuate in some workplaces. This means that dangerous cultures and management failures continue. In relation to the individual, NDAs starve alleged victims of any form of justice, either through internal processes or through tribunals. For the employees who remain, the alleged perpetrator can be left untouched, presenting a danger to the rest of the workforce.

The Committee concluded:

“We are particularly concerned that some employers are using NDAs to avoid investigating unlawful discrimination…and holding perpetrators to account.”

Let us not forget that employers have a duty of care to all their employees and should be looking to tackle these instances, whether or not the person involved is a “rainmaker”—that was another concerning part of the evidence. The Committee report referred to rainmakers being given a degree of latitude when it came to behavioural standards. Those individuals are worth more to the business, which continues to use NDAs to avoid holding them to account. That sends out a clear message that the safety of employees can be ignored if the accused is valuable enough to the company. One worker told the Committee:

“I was told the abuser was indispensable and I was not.”

I think we can all agree that that is completely unacceptable and should not be happening in any workplace in this country.

According to the Solicitors Regulation Authority, NDAs should not impede or deter someone from co-operating with a criminal investigation, reporting an offence to the police or reporting a breach to a regulator, or prevent proper disclosure about the agreement or circumstances surrounding it to professional advisers, including medical professionals and counsellors, or the making of a disclosure under the Public Interest Disclosure Act. However, although there were no cases of solicitors drafting these agreements to deliberately prevent that, the SRA’s recent investigation found

“a number of common trends or practices which inadvertently might contribute to this happening.”

This leaves signatories feeling uncertain as to whom they can speak to or what they are allowed to say. When combined with the threat of clawback or penalty clauses, many will, unsurprisingly, self-censor to prevent them from losing their settlement. It also brings with it a weight to be carried—a significant burden over the long term.

Clearly, questions must be asked of the response to this situation. What I and other hon. Members have described today is not a recent problem that has emerged from nowhere. The implications of the use of NDAs in the workplace have been known for some time, yet we have seen very little action taken. There was a flurry of interest and promises were made back in 2019, but more than four years later the only changes have been updated ACAS guidance and a warning notice sent out by the Solicitors Regulation Authority, both of which are non-binding and appear to have done little to mitigate the problems.

The Legal Services Board offered a damning indictment in a call for evidence earlier this year. It said that

“notwithstanding the usefulness of the standards and guidance summarised above, the evidence of continuing misuse of NDAs suggests that clearer and more effective expectations for the professional conduct of legal professionals may be required.”

This is rather galling given that the Government promised to

“crack down on misuse of non-disclosure agreements”

all those years ago. Legislation was supposed to be in place to compel employers to write the limitations of the confidentiality clause in plain English, extend legislation to ensure that individuals signing NDAs get independent legal advice, and introduce enforcement measures to deal with NDAs that are not compliant and make them void. The updated ACAS guidance has included these elements, but that is not the same as enforceable legislation. As the right hon. Member for Basingstoke said, if it is right for the higher education sector, it is right for everywhere else as well. I feel that this area has fallen victim to the Government’s inertia on employment rights. As the Minister will have heard today, there is a great deal of willingness to see that changed.

[Rushanara Ali (in the Chair)]

I would be grateful, Minister, if you could leave a little bit of time at the end for Dame Maria Miller to respond to the debate.

Strikes (Minimum Service Levels) Bill

Justin Madders Excerpts

Consideration of Lords message
Monday 17th July 2023 Commons Chamber

[Madam Deputy Speaker (Dame Rosie Winterton)]

I call the shadow Minister.

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

I draw the House’s attention to my entry in the Register of Members’ Financial Interests.

Let me repeat, at the outset, our opposition to the Bill and our intention to repeal the Act that it will become should we be in a position to do so in the future. It is one of the most illiberal, unconscionable and ultimately destructive pieces of legislation produced by any Government. We believe that the right to withdraw labour is a fundamental right, a human right, and one that should not be extinguished. Even if some Conservative Members cannot see past their hostility to trade unions and past the easy headlines, they should see that what they are asking their constituents to do is distinctly un-British, because it infringes on individual freedoms that ought to be—even for Conservative Members—a basic part of any open and democratic society.

Freedom matters, and valuing freedom sometimes means that we protect another person’s freedom to do something even if we do not personally agree with the particular course of action. But our objections are based not just on principles, but on practicalities. Ultimately, we do not think that the Bill will work. The Bill is counterproductive because it will not quell the concerns of many people in the sectors that have taken industrial action. Taking away the right to strike will not take away people’s concerns. We cannot legislate away people’s legitimate grievances about their working conditions. Because the Bill is so ill defined and poorly thought through, Parliament must have a proper opportunity to consider its ramifications.

The measures set out in Lords amendment 2D attempt to address some of those issues. The amendment also provides yet another opportunity for us to raise our concerns about the Government’s lax approach to proper scrutiny during the Bill’s progress so far. Let us go back to when the Bill was first published. It is surely a basic expectation of Government that they should provide an impact assessment before asking hon. Members to vote on a Bill. But no—we were asked to trust the Government that the matter was in hand and that all would be fine. We said it at the time and we say it again: that approach is completely unacceptable.

The Bill had been trailed in the press for months before it was published, so not to have the impact assessment ready at the same time was a failure of basic competence. When it finally appeared, we could see why the Government were so keen to keep it under wraps. The Regulatory Policy Committee said that it was not fit for purpose—it could just as easily have been talking about the Government—and no wonder, given that the assessment contains statements that undermine both the purpose and execution of the Bill.

The impact assessment states that the Bill

“could mean a general increase in tension between unions and employers. This may result in more adverse impacts in the long term, such as an increased frequency of strikes for each dispute.”

When Ministers told us on Second Reading that the Bill would reduce the disruption caused by strikes, what they apparently did not know was that the Government’s own impact assessment would say that it could, in fact, have the opposite effect. The impact assessment also says, on at least half a dozen occasions, that assumptions are being made about the level of service that would be required. That is the point of the Lords amendment: unless we have some idea about what these minimum service levels will be—in the six months since the Bill was published, Ministers have not come to the Dispatch Box and told us—we are legislating in a vacuum.

The point has not been lost on the Delegated Powers and Regulatory Reform Committee, which wrote in its assessment that

“there is nothing in the Bill saying what those minimum service levels are. We shall only know when Ministers make regulations after the Bill is enacted. This is small comfort to Parliament, which is considering the matter right now.”

The Committee’s recommendation was that the Government should publish indicative draft regulations alongside the Bill. As it rightly points out,

“the Government must have some idea how they propose to exercise these powers.”

It is no surprise that the impact assessment got a red rating. Of the 861 Bills assessed by the Regulatory Policy Committee since its creation, just 2.9% have been given a red rating. When legislation represents such a fundamental departure from past practice, the importance of impact assessments increases rather than decreases.

If this all sounds familiar to you, Madam Deputy Speaker, that is because it is. Only last week the High Court said, in relation to the consultation process for the regulations that allow agency workers to break strikes, that

“this is not a case in which the evidence is that the proposal had obvious and undisputed merit based on cogent evidence, and enjoyed strong support from representative bodies in the sector”.

It could have been talking about this Bill—no doubt, in time, it will be.

The pattern is familiar. The Government decide the policy, although “policy” is probably too strong a word. The Government decide the headline that they want to create, rush through ill-thought-out legislation and then ignore all the voices that point out principled and practical objections. That is to treat democracy with contempt. Parliament is not a rubber-stamping process to agree whatever the Government of the day decide. When Parliament is starved of its ability to properly scrutinise legislation, that impacts on fundamental human rights, as it does in this case. It should come as no surprise that there is pushback from the other place requiring that a robust process be followed.

The amendment is important because the International Labour Organisation’s conference committee on the application of standards called on the Government to ensure that existing and prospective legislation is in conformity with the convention that governs freedom of association and the protection of the right to organise. I would not have thought that is too much to ask of a modern liberal democracy. In fact, I am rather ashamed that the ILO has had to point it out at all.

All this amendment does is what the ILO is asking the Government to do anyway, which is to undertake genuine consultation before implementing minimum service regulations. This means that, when regulations are published, they would include an impact assessment and there should be genuine consultation on the regulations, including on the protection for workers named in work notices and the reasonable steps a trade union needs to take to ensure compliance.

--- Later in debate ---

[John McDonnell (Hayes and Harlington) (Lab)]

I am sorry to interrupt my hon. Friend when he is in full flow but, as he is developing his argument on the need for consultation and impact assessments, has he been able to clarify with the Government what happens if an employer refuses to comply? In London, for example, the buses are contracted out, and individual bus companies have had individual disputes. If the Government instruct there to be a minimum service level but the employer does not want to sour industrial relations in the long term and therefore refuses to comply, what then happens?

[Justin Madders]

That is a very good question. My understanding—no doubt the Minister can correct me if I am wrong—is that it is still up to the employer to determine what work notices it issues, which makes the Bill a little ludicrous.

All these consultation papers, all these impact assessments, and we are still legislating in the dark.

[Rachael Maskell]

My hon. Friend has just made a valid point, because when NHS Employers and the NHS Confederation came before the Select Committee on Health and Social Care, they said that they did not want any of this legislation. Presumably, following that logic, they will not have to issue minimum service level terms for a strike.

[Justin Madders]

I thank my hon. Friend for her intervention. That is why it would have been so interesting to see what the consultation responses were to the draft regulations, because those might have told us whether employers were saying, “Don’t do this; we don’t think it is going to work.” We know that a long list of employers’ organisations are opposed to this Bill, and I will come on to that in a moment. They understand that, ultimately, it is not going to help industrial relations but will sour them.

In summary, the Bill’s impact assessment turns up late and is inadequate; no pre-legislative scrutiny or evidence sessions for the Bill took place; the Committee stage is rushed through in one day; and subsequent consultations are incomplete and leave many questions unanswered. Yet the Government still say that this Lords amendment is not necessary. The evidence to date and the opinion of the ILO say otherwise. I referred to the fact that the ILO is not alone in expressing concerns about the Bill. Many organisations have expressed alarm, including the Equality and Human Rights Commission, the Joint Committee on Human Rights, NHS Providers, the rail industry, the Chartered Institute of Personnel and Development, the TUC, and the Welsh and Scottish Governments. The Transport Secretary and the Education Secretary have also done so, and I could give more names, but I have only an hour for this debate and so I will leave it there.

When we have the shameful spectacle of the ILO calling this Bill out, Members need to think again. By rejecting this Lords amendment, the Government are, in effect, saying one of two things: either they do not know whether they break international law; or they do know but they just do not care. We ought to care, we ought not to be trailing behind in workplace protections, and we ought not to be mentioned in the same breath as Turkmenistan. We ought to be leading from the front, as an exemplar for other countries to follow and a leader on the international stage that says, “Yes, good workplace rights and strong trade unions are a key component in any prospering modem economy, and the right to withdraw your labour is a fundamental one.” However, this Bill is the hallmark of a weak Government who have run out of steam, have nothing left to offer but division and want to silence the very people who keep this country going—shame on them.

[Madam Deputy Speaker (Dame Rosie Winterton)]

I call the Scottish National party spokesperson

Post Office Ltd: Management Culture

Justin Madders Excerpts

Thursday 13th July 2023 Westminster Hall

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

It is a pleasure to see you in the Chair, Sir George. I start by thanking the hon. Member for Motherwell and Wishaw (Marion Fellows) for securing the debate. Her tireless work on this scandal is well recognised across the House and is greatly appreciated. Indeed, all Members who have spoken have been powerful advocates during their time in the House. They gave many powerful examples of how the management culture in the Post Office has had an impact on individual people’s lives.

The hon. Member for Motherwell and Wishaw talked about obfuscation, secrecy and cover-ups, saying that nobody has truly been held to account for this. She made it clear that the victims she has spoken to have little faith that justice will be done. That really has to change. She raised several important questions that the Minister will hopefully be able to address, and I will refer to a number of the issues she mentioned.

The hon. Member for Telford (Lucy Allan) spoke very powerfully. Her point about her constituent meeting the chief executive earlier this week really got to the nub of the problem: words need to be matched by action. That is the challenge that Post Office’s management need to step up to. She raised questions, as all Members did, about culture and governance. My right hon. Friend the Member for North Durham (Mr Jones) raised similar issues in a passionate speech. It is clear that there are serious questions about what the board is doing.

Litigation has been ongoing for several years. The fact that the inquiry does not have the documents because they cannot be found raises questions about what on earth has been going on. Documents would normally be prepared for litigation, so my right hon. Friend the Member for North Durham was right when he said that questions must be asked about what the board is doing. He talked about lies, cover-ups and deceit being the culture—a culture that is rotten to the core. He also talked about a tsunami of public cash being used to defend the indefensible. Those comments really sum up why this is something that has to change.

As the hon. Member for Motherwell and Wishaw said, it is very clear that this is one of the greatest—if not the greatest—miscarriages of justice in this country. We have heard many poignant examples about how the lives of hundreds of innocent post office workers have been ruined by the Post Office aggressively pursuing them on the basis of a fundamentally dodgy IT system about which worries had been flagged up.

Concerns about culture have been repeatedly raised in the debate. As Members have mentioned, the High Court in the case of Bates v. Post Office Ltd stated:

“There seems to be a culture of secrecy and excessive confidentiality generally within the Post Office, but particularly focused on Horizon.”

This is not someone down the Dog and Duck talking about the Post Office. It is a member of the judiciary, so we have to take those words very seriously.

Those sentiments are reflected by the Communication Workers Union, which identified a

“serious and longstanding cultural and governance problem”

rooted—a word we keep coming back to—in a fundamental lack of accountability. In its view, this led to the abuse of power, corporate complacency, denials, cover-ups and false evidence that have been the hallmark of the Horizon scandal. These comments are rightfully damming. The complete overhaul of Post Office management and culture that one would have expected on the back of such claims has been lacking. From the stories we have heard, the Post Office seems largely unreformed.

Despite assertions to the contrary, we know that, as the hon. Member for Motherwell and Wishaw detailed, years have been spent fighting compensation claims against honest sub-postmasters. Every trick in the book has been used to draw things out for as long as possible. That includes making low compensation offers, only for them to be raised once legal action is taken, and using technical and misleading language in letters to dissuade victims from seeking expert advice. Those are not the behaviours of an organisation that has a true insight into its failings. Those are not the behaviours of an organisation that is contrite. Those are not the behaviours of an organisation that recognises that it needs to change. Sixty former sub-postmasters have died without payouts and most victims are still waiting to receive their full and fair compensation. That is outrageous. Victims have been failed time and again by the Post Office’s toxic management culture. What are the Government going to do to protect those victims and to ensure that justice will be fairly and swiftly delivered?

As we heard from the hon. Member for Motherwell and Wishaw, executives have been receiving substantial bonuses while this has all been going on. We heard about chief executive Nick Read receiving £455,000 in bonuses on top of his £415,000 salary in ’21-22. As we know, part of those substantial bonuses was falsely reported to have been agreed by Sir Wyn Williams, who led the Horizon inquiry. That bonus was paid due to Read’s co-operation in the handing over of documents. We now know that to be false on two counts. First, it was reported in May that Sir Wyn did not sign it off; that was a complete fabrication. Last week, it was found that the documents for that day of evidence in the inquiry had not actually been disclosed at all. As the hon. Member for Telford said, there must be questions when the chief executive does not know the facts on something so important to the Post Office and to the victims.

This is not just a casual misunderstanding; the Post Office annual report and accounts for 2021-22 published the metrics on which bonuses for senior leaders were based. One metric, which was marked as achieved, read:

“All required evidence and information supplied on time, with confirmation from Sir Wyn Williams and team that Post Office’s performance supported and enabled the Inquiry to finish in line with expectations.”

We now know that to be completely false; Sir Wyn Williams actually said:

“I am dissatisfied by the approach that has been taken by the Post Office; in my view, their approach demonstrates a lack of clear thinking about the disclosure obligations owed to the Inquiry with which the Post Office must comply and the means by which their obligations can be fulfilled.”

The Post Office has issued a clarification to the report and an apology, stating:

“We recognise that by setting this particular sub-metric, and marking it as achieved, we implied that Sir Wyn and his team had agreed to this sub-metric and had commented on the outcome. We wish to clarify that we did not ask for Sir Wyn’s agreement to the wording of this sub-metric and Sir Wyn and his team did not give any input into assessing whether it had been met.”

This is an annual report; basic things like that ought to be checked before they appear in black and white.

If we put aside the argument of whether executives should be paying themselves handsome sums for complying with things that they ought to be doing by law anyway, and if we also try to overlook the vast irony of the Post Office being caught doing what it pursued sub-postmasters for supposedly doing, as my right hon. Friend the Member for North Durham said, that is a moral issue. There are questions about that.

There is also the question of whether people making such statements are fit to be running any business. I know the Minister is looking into the governance arrangements, but has he commissioned any investigation into whether section 1112 of the Companies Act 2006 was breached in this episode? I would be grateful if he would address that specific point in his response. If he is unable to do so today, can he respond in writing?

Understandably, the focus has been on the Horizon scandal—there are so many things that need to be addressed—but, as other Members have referred to, the creeping withdrawal of post office services affects all our communities. We have been reminded today of the important functions they perform, particularly for older and disabled people, carers and those who simply cannot access the internet. The post office is a vital lifeline, especially when other vital in-person services such as banks are closing at an alarming rate. There is a serious question about whether the management have the ability to meet those challenges.

I was struck by the comments from a constituent of the hon. Member for Motherwell and Wishaw who said that they make more money from the coffee machine than from post office services. That might explain why there is a silent withdrawal of the post office from our communities. Of the 11,500 post offices in operation, only 4,000 are open seven days a week. There has been a proliferation in the number of outreach branches. In 2000 there were just 52, representing 1% of the total network. As of March last year, that had gone up to 1,901, comprising 16% of the network.

I would be interested in whether the Post Office meets any of its six accessibility criteria if part-time or partial service branches are included. Have the Government conducted any analysis into that? How many people are reliant solely on outreach services? Constituents have told me that they have to go on a magical mystery tour of the constituency to find a post office that is actually open, and that is not because they go out at unsociable hours; it is often in the middle of the day. Many people now struggle to find somewhere open because the advertised hours are not adhered to. I do not know why that is happening, but it points to something badly wrong in the whole system. What can be done about it? Has the Minister made an assessment of the anticipated profits of an average post office operating on a full-time basis? Is the system sustainable or is there a problem with the way it is being run?

Another difficulty is when one of the many sub-postmasters decides to close up shop, and we see time and again a failure to address that issue. It has happened many times in my constituency; I am sure it has happened in other Members’ constituencies. Every time the Post Office tells us that it will look for another partner to open up. We wait and we wait and sometimes—months or even years later—we get a new post office, but sometimes it does not appear at all. I have said repeatedly, every time there is a closure, that the Post Office’s laissez-faire attitude to another one reopening is not good enough. It does not work, and it is allowing services to wither on the vine. I can give examples of each outcome in my constituency.

In Elton in 2016, we waited a year for the post office to reopen after it had closed. Neston lost its branch almost two years ago, and it is now open in a car park for two hours on two days a week. Great Sutton post office closed last year, and there is no sign of it reopening. It all feels like management either do not care or do not have the capability to address this structural challenge. We know they have not been able to do the job in the past. Can they do it in the future?

I raised that issue primarily because there is a pattern here. The failure to handle post office closures has parallels with the failure to deal with the Horizon scandal, which have both shown an unwillingness to change or to accept that things need to be improved.

Does the Minister have confidence in the management of the Post Office? Does he think the management culture has changed sufficiently since Horizon first emerged? What are the Government doing to ensure that victims receive the compensation that they rightly deserve? Does he consider that they have a sufficient grip of public access to post offices and a proper strategy to maintain services?

Strikes (Minimum Service Levels) Bill

Justin Madders Excerpts

Consideration of Lords message
Wednesday 21st June 2023 Commons Chamber

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

Thank you, Mr Speaker. I draw the attention of the House to my entry in the Register of Members’ Financial Interests.

Today, we consider a number of Lords amendments that will go some way towards making the Bill slightly less draconian than it currently is, but will not make it a Bill that we can ultimately support. I start by paying tribute to Members in the other place who have done their best to ameliorate the Bill with the sensible amendments that we are considering, and which we will be supporting. What those Members understand is that the Bill is the act of a weak Government who have lost the authority and the will to govern for everyone; a Government who prefer legislation to negotiation, diversion to resolution, and confrontation to consultation. How Ministers have the gall to come to the Dispatch Box and talk about the importance of minimum service levels when we have seen the decimation of our public services under this Government—with a record 7.4 million patients left on waiting lists, record teacher vacancies, and ever-increasing response times to calls to the police—is beyond me.

[Margaret Greenwood (Wirral West) (Lab)]

My hon. Friend is making excellent points. I have heard from doctors in Wirral West who firmly believe that the Bill represents an intrusion on legitimate trade union activities, undermines workers’ rights to representation, and would leave unions unable to effectively represent their members. Does my hon. Friend agree?

[Justin Madders]

I thank my hon. Friend for her intervention, and I do agree with those doctors. I will go on to explain why the Bill is an attack on basic freedoms and liberties that I thought this country held dear.

Turning first to Lords amendment 2B, as we know, the Bill presents the Secretary of State with huge, unchecked powers, throwing scrutiny and democracy out of the window. We think it is entirely reasonable that if a Secretary of State wants the power to set, impose and police minimum service levels, they should be accountable for the impact of those powers and able to demonstrate what their impact will be. Requiring them to conduct a proper impact assessment on the use of those powers and hold a consultation on any specific proposals they have could be helpful to a Secretary of State, because they cannot possibly know how every nook and cranny of any particular sector operates and what is needed to deliver a minimum service level—assuming they can define what one is.

If the Government think that it is such a wonderful idea to introduce minimum service levels in the sectors covered by the Bill, they should not fear scrutiny of their proposals, consultation with those directly affected, or challenges to their assumptions. My fear is that the Government fear all of those things. When the Regulatory Policy Committee described the Bill as “not fit for purpose”, one would have hoped that any sensible and rational Government would put a little bit of effort into talking to people to make sure that their own Bill had even a remote chance of working, but I suspect that—like so many things that we hear from this Government—they do not look beyond the easy headline and do not think through the consequences of their actions.

I will turn briefly to Lords amendment 5B, which attempts to deal with what is essentially a full-blown attack on the independence of trade unions and their members. I know that the Government have been raising the bar ever higher on the number of members required to vote in favour of industrial action. However, even they must see that putting a requirement on a trade union to take action to stop some of its members from participating in industrial action once they have voted in favour of it—as proposed new section 234E of the Trade Union and Labour Relations (Consolidation) Act 1992 would do—undermines the very essence of what a trade union stands for.

We have never had an adequate explanation of what reasonable steps a union is expected to take in those circumstances. The Minister previously told us that it would be a matter for the courts to determine, but that represents an abject failure by the Government to do their job. Are they really saying to trade unions that they can face damages of up to £1 million if they fail to comply with the Bill, but that they will have to wait for a court to decide what they need to do to avoid that liability? That is ludicrous, dangerous, and a potentially disastrous situation for any trade union to be in. This amendment removes Government interference in lawfully and democratically made decisions by an independent non-governmental organisation, and removes the completely disproportionate risk that trade unions face if they fail to adhere to the undemocratic, unspecified and unconscionable requirements of this provision.

[Rachael Maskell]

I should refer to my entry in the Register of Members’ Financial Interests.

My hon. Friend makes a very good point about the jurisdiction of trade unions. I have said this in the House before, but Government Members just do not seem to understand it. It is the members of the trade union who determine what happens within a trade union—it is not a general secretary or even an executive, but the members—so how are they, as individual members, going to instruct workers to attend work?

[Justin Madders]

That is really a question for the Minister, and one that I think the Government have failed to answer adequately. I think the point my hon. Friend makes is a good one. When Conservative Members traduce the union barons, they actually traduce every single member of the trade union who has voted in support of industrial action, and I am afraid that that is no way for any Government to operate.

I would ask Conservative Members, not that there are many here, to consider what the Bill actually means. Representatives of trade unions will be required to encourage, cajole, advise, pressurise or even demand that their members cross a picket line. They will be asking trade unions to actively go against the very thing they were set up to do. I would say that it is a bit like asking a Conservative MP to vote in support of higher taxes, but I guess that, with the highest tax burden in over half a century, we may have to drop that particular analogy.

[Margaret Greenwood]

My hon. Friend is being very generous in giving way. I am a proud trade unionist, but I am also a former schoolteacher. I am concerned not only about the administrative burden that this requirement for employers to serve work notices on staff will create, but about the risk of damaging relationships within the workplace. He is talking about people being required to cross picket lines, and that would most definitely be a case in point. I am very concerned, because schools and hospitals in particular operate through staff collaborating with each other, and risking those relationships is a very dangerous thing to do.

[Justin Madders]

My hon. Friend is absolutely right. That is why so many employer organisations are also against this Bill, because they understand what it will do for industrial relations: it will make them worse, not better. I would ask Conservative Members to think carefully about what they are asking trade unionists to do, which is to go against deeply held, genuine and sincere beliefs—

[Clive Efford (Eltham) (Lab)]

I intervene to give my hon. Friend a chance to get his throat in order. Does he agree with me that, first and foremost, the Prime Minister withdrew his Labour on Monday with the intention of not showing leadership, which is a remarkable feat on the part of a Prime Minister? Does my hon. Friend agree that these are the death throes of a Government who have really run out of steam? They are trying to blame everybody else for what is going wrong. They are going for a cheap headline and have created this piece of legislation, which is anti-trade union and anti-democratic, to try to throw the blame on to the trade unions and workers, and away from where it really lies—with this Government.

[Justin Madders]

I thank my hon. Friend for his intervention—I think my voice has returned, thankfully—and he is absolutely right. This Bill is counterproductive because ultimately it will not quell the concerns of many people in those sectors that have taken industrial action. Taking away the right to strike will not take away people’s concerns; it will just make them worse, and it will prolong anxiety, concern and discord.

Again, I ask Conservative Members to think about what they are asking trade unions to do—to go against deeply held, genuine and sincere beliefs. Whether or not they agree with the right to strike, do they really think in all conscience that this is something that sits comfortably with notions of dignity, respect and freedom? How would they feel if they were compelled to take actions in direct contravention of their own values?

Finally, I turn to Lords amendment 4B. It attempts to tackle the pernicious heart of this Bill, which seeks to destroy the basic freedoms that the trade union and Labour movement have fought to secure over the course of history. From the Chartists to the founding of the TUC, the trade unionists at Taff Vale and the formation of the Labour Representation Committee, the working people of this country have faced a long and arduous struggle to improve their working conditions, and fundamental to that struggle has been the right to withdraw labour. When Conservative Members inevitably vote down this amendment, they are saying to their constituents—the teachers, doctors, nurses, bus drivers and train drivers—that their voice does not matter and that, should they dare to withdraw their labour in search of better terms and conditions, they do so at their own risk.

[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.

[Mr Speaker]

I call the SNP spokesperson.

--- Later in debate ---

[Kevin Hollinrake]

I thank Members for their contributions. It is fair to say that we will have to agree to disagree. We believe that this legislation is a proportionate response that gives the Government the power to ensure a safe level of service in areas such as health, transport and border security, so that people’s lives are not put at risk and they can work, access healthcare and safely go about their daily lives.

I will touch on one or two points raised by right hon. and hon. Members. I have a great deal of time for the shadow Minister, the hon. Member for Ellesmere Port and Neston (Justin Madders), though perhaps we do not agree so much in this debate. He asked who we govern on behalf of, and he listed very important people in our society—our nurses, train drivers and border security officers. But is he properly representing the many other stakeholders in this debate, such as pub landlords, restauranteurs, hoteliers and people seeking urgent medical treatment or trying to get to work or to see family? There have been 600,000 cancelled appointments as a result of the strikes of recent months and £3.2 billion of economic detriment—much of that to our restaurateurs, hoteliers and pub owners. It is important that their voices are heard, too.

[Justin Madders]

I hear what the Minister is saying, but that is an argument to ban strikes altogether. Is that not what he is doing?

[Kevin Hollinrake]

We have been clear that there is a balance between people being able to seek industrial action and being able to go about their daily lives. That is the balance that we are trying to strike. He asked if we fear scrutiny; not at all. What we fear is delay. That is what the Opposition parties are trying to bring about: delay in wrecking amendments.

Oral Answers to Questions

Justin Madders Excerpts

Thursday 18th May 2023 Commons Chamber

[Mr Speaker]

I call the shadow Minister.

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

Ministers have promised an employment Bill more than 20 times, but they have consistently failed to deliver. It seems that not a week goes by without a company in the gig economy announcing that it is stripping back workers’ rights and protections, presumably because they are confident that this Government will not legislate to introduce protections in the gig economy. Will the Minister come clean on the Government’s plans? If they are not going to bring in any protections for gig economy workers, will he now apologise to them for another failed promise?

[Kevin Hollinrake]

Paying the national living wage is the law, and failing to pay workers the correct wage can result in significant fines, public naming and, for the most serious offences, criminal prosecution. The national living wage applies to all those who are classified as employees or limb (b) workers. If an individual feels that their employment status has been misclassified, they have the right to go to an employment tribunal.