Employment Rights Bill

Lord Burns Excerpts

2nd reading
Thursday 27th March 2025 Lords Chamber

[Lord Burns (CB)]

My Lords, I am delighted to follow the noble Baroness, Lady Gray, and to be able to congratulate her on her fascinating maiden speech. She has a long and successful background in the Civil Service, and she described today some of the things that have affected that experience. My message to Ministers is that they would be well advised to take her advice when it comes to how to get the best out of civil servants, because she has been remarkably good at it.

I first met the noble Baroness, Lady Gray, when she was running the propriety and ethics function within government. I was chairing a commission investigating whether the Freedom of Information Act was working as intended. I have to say that the group of journalists who spent their time looking at FoI stories regarded her as the most powerful obstacle in their career—and that was before she was in the public eye. Maybe she wishes she might have stayed there. Instead, she became known everywhere for her forensic talents, which were brought to bear on the “partygate” scandal. There was a period when it appeared that no politician could appear on television and face a question without answering, “That is an issue for Sue Gray”. She did not seek the job; it was thrust upon her. She carried out that task with great skill and courage. She is a person of immense integrity and a delightful colleague, and she will be a very valuable Member of this House.

I also enjoyed the speech of the noble Baroness, Lady Berger. Somewhere, I have a photograph of myself with Manny Shinwell in County Durham, aged 16 or thereabouts. I have very fond memories of that occasion.

I also look forward to the maiden speech of the noble Lord, Lord Young of Acton. He swells the ranks of Members of this House—a very small group—who have families who support Queens Park Rangers. He is very welcome. I enjoy his match reports; I doubt that the manager and the team always feel the same about them, but I suppose that is freedom of speech. I also look forward to hearing from the noble Baroness, Lady Cash, and hope that she also enjoys the experience.

I will limit my comments on the Bill to the provision concerning trade union finances. Clause 59 would change the way in which trade union members pay the political levy. Under the proposal in the Bill, all trade union members will automatically pay the political levy unless they personally take the decision to opt out.

I am concentrating on this because I have been there before. In 2016, the Trade Union Bill introduced by the newly elected Conservative Government proposed to do exactly the opposite. They proposed to move to an opt-in system for political funds, with union members being required to opt in, in writing, if they wished to pay the political levy. Following the Lords Second Reading, the noble Baroness, Lady Smith, then the Leader of the Opposition, tabled a Motion to establish a Select Committee to consider the impact of the clauses dealing with trade union political funds. The Motion was agreed, and the committee was appointed, of which I was asked to be the chairman, and we were given a very short deadline for reporting.

The committee took evidence and came to the view that reintroducing an opt-in process for all members

“could have a sizeable negative effect on the number of union members participating in political funds”,

and that there would be a “significant reduction” in union payments to the Labour Party. The committee concluded unanimously that the opt-in system should apply to all new members—new members would be required to actively opt in to paying the political levy. However, there was disagreement within the committee on whether the opt-in should also apply to existing union members as well and whether they would remain on an opt-out basis. The majority of the committee thought that the opt-in should not be extended to existing members unless it was part of a wider reform of party funding. On Report, I tabled amendments that new members should opt in and that existing union members should remain on an opt-out basis. This was carried almost on a two to one basis in this House. Several days later, the Government accepted these amendments, despite some significant unhappiness on their own side.

Given this history, I am surprised that the new Government wish to move back to the pre-2016 position whereby all members automatically pay the political levy unless they opt out. I had hoped this issue had been laid to rest for the time being, but it appears not. I have some questions for the Minister. There is a long tradition of Labour Governments legislating for opt-out while Conservative Governments in turn legislate for opt-in. Do we really want this opt-in, opt-out ping-pong to go on with every change of Government? Do the Government really want to take the risk with the future funding of the Labour Party the next time there is a change of Government? Would it not be better to let this issue rest where it is and to maintain the compromise we reached in 2016?

Employment Rights Bill

Lord Burns Excerpts

Committee stage
Tuesday 10th June 2025 Lords Chamber

[Lord Burns (CB)]

My Lords, my Amendment 217 relates to Clause 59 and the requirement to contribute to a political fund, and I am grateful for the support of the noble Baronesses, Lady Finn, Lady Coffey and Lady Cash. As we know, by law, a trade union wishing to spend money on party-political activities must set up a separate political fund for financing any such expenditure.

The amendment addresses a single issue: whether new trade union members should be explicitly asked whether they wish to opt in to contributing to the union’s political fund or should automatically become contributors to the political fund unless they take action to opt out. The present position is that new trade union members become contributors to the political fund only if they give notice of their willingness to do so by submitting an opt-in notice. Additionally, every year unions must notify members of their right to submit a withdrawal notice.

Clause 59 proposes to change both conditions so that new members will automatically become contributors to the union’s political fund unless they give notice of their wish to opt out, and will be notified of their right to submit a withdrawal notice only every 10 years, rather than every year as at present.

This is a controversial issue today and one that has been debated for more than 100 years. The position on opt-in or opt-out has changed several times since trade union political funds were legalised in 1913. I am very sorry for my cough.

[Baroness Stowell of Beeston (Con)]

Will the noble Lord give way? He might find an opportunity to take advantage of the water that was provided. I just wanted to say that the noble Lord, Lord Burns, is making a very powerful contribution to this debate and I am going to support him in his argument. I am very grateful to the noble Lord for giving way.

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[Lord Burns (CB)]

I thank the noble Baroness for those kind words. Unfortunately, it is the season of the year when I take various inhalers for hay fever and such like and the dust tends to gather in my throat when I am sitting for long periods, as I have been this afternoon.

I was just mentioning that this is a debate which has gone on for a long time. Between 1946 and 2016, members automatically became contributors to political funds unless they opted out. In 1984 the Conservative Government considered legislating to change to the opt-in model but settled for an agreement that the unions would increase awareness among members of their right to opt out.

In 2015 the Conservative Government introduced a Trade Union Bill that proposed to change the system so that both existing and new members would contribute to the political fund only if they explicitly opted to do so. The Labour Opposition argued that this change would have a negative impact on the size of union political funds, and consequently Labour Party funding. They argued that this should be done only in the context of broader party funding reform. They were successful in establishing a Select Committee to consider the issue and to find a solution in parallel with the Bill’s progress.

I was asked to chair the committee, and several other members of the committee remain Members of the House today. The committee concluded that reintroducing an opt-in process for all members, including existing members, could significantly reduce the number of union members participating in political funds. It also concluded that this would lead to a significant reduction in union payments to the Labour Party while leaving donations to other parties unaffected.

A majority—but not all—of the committee concluded that the proposed requirement to opt in should not apply to existing members unless it was part of a broader reform of party funding. However, the committee unanimously decided that the opt-in mechanism should apply to all new members. After further debate, the Conservative Government accepted compromise amendments that limited the opt-in mechanism to new members, despite some significant unhappiness on their own side.

I acknowledge that there is no conclusive approach to determining whether opting in is better or worse than opting out. In some cases, opting out is deemed appropriate, such as in the case of workplace pensions, where the failure to opt in could result in future costs for government. However, evidence from various settings suggests that when it comes to making additional payments, more people will end up paying if they must opt out rather than opt in. The more cumbersome the administrative hurdles to opting out, the greater the likelihood an individual will not exercise their right to do so. Such administrative hurdles increase the likelihood that the outcome will not be in the best interests of the individual.

On balance, I prefer that we should ensure that people make informed decisions based on clear and transparent options. With most financial products—and decisions about allowing tech companies to use individuals’ data—there is a requirement to explicitly opt in. The concern is that allowing companies to require opt-out preys on people’s inertia. Furthermore, we have spent hours in this House debating the data Bill and the question of opting in or opting out of AI models’ ability to learn from copyrighted material. My own view is that requiring people to explicitly opt in reflects their preferences more accurately.

During a helpful conversation with the Minister, for which I am grateful, she emphasised that this is not simply a return to the position pre 2016. However, my fear is that in substance that is indeed what it is. I would welcome clarification on some aspects of the Government’s proposals. Will it be a requirement that the union’s application form for members joining a union continues to include a statement to the effect that a member may choose to opt out of the political fund and that they will not suffer any detriment if they choose not to contribute? Will new members have the option of choosing to opt out before completing the application? Why do the Government wish to change the requirement that a member be reminded annually of the right to opt out? The new proposal is that they should be reminded only every 10 years. What is the Government’s justification for this change?

Is there any reason why it should not be possible to give an unbiased choice at the time of joining? There could be two questions—two boxes—and a requirement to tick one box. One might say, “I wish to contribute to the union’s political fund”, and the other, “I do not wish to contribute to the union’s political fund”. The application would not be complete without ticking one or the other—a practice that we see very often these days, particularly with online applications. Does the Minister anticipate that the proportion of new members contributing to political funds will be higher under this legislation than has been the experience under the present 2016 Act and, if so, by how much?

Finally, I say this to the Government in the friendliest terms I can muster: why are they running the risk that the next time there is a change of government there will be another reversal which results in something less favourable to Labour than the 2016 compromise? Another reversal might well introduce the opt-in system for all members, both new and existing; in other words, the proposal on the table before the 2016 compromise that caused all the trouble at that point.

I stress that I have no view on whether trade union members’ contributions to political funds are too high or too low. Having tried, with a small amount of success, to find a resolution to the issue in 2016, my only ambition in involving myself in this Bill is to secure a lasting solution to the issue of contributions to political funds that can stand the test of time, as I hoped the 2016 compromise would. The purpose of my amendment is to oppose the move to an opt-out mechanism until we have more justification for such a change and greater clarity about some of the questions I have outlined.

[Lord Prentis of Leeds (Lab)]

My Lords, I speak in favour of the Employment Rights Bill unamended and declare an interest as I was general secretary of the UK’s largest union, UNISON, for over 20 years. It has over 1.3 million members; over 1 million of them women, mainly low paid. I have seen at first hand over those 20 years the good which our political funds can do. In my own union the political funds support our campaigns—campaigns to reform the social care sector, which we have talked about often in this place; campaigns for fairer pensions for women, for better rights for disabled workers and human rights in Northern Ireland—and, something I am particularly proud of, our anti-racism work.

Our political funds support projects to bring children from Asian and white communities together. They fund our work tackling racism as part of HOPE not hate, and our work with footballers on Show Racism the Red Card in schools and at football matches over the past 20 years. The fund is used to send films to every school on the horrors of the Holocaust. It is used for ground-breaking initiatives to build fairer and safer communities. What many do not realise is that, without using the resources of our political funds, it would be unlawful for trade unions to campaign politically on behalf of members in any pre-election period—not just Westminster elections but all elections. The slow drain of money from the political funds caused by the 2016 Act and arrangements is having a serious effect on the right that trade unions have had for more than 100 years: the right to campaign politically.

How political funds are used varies from union to union. Many unions have political funds that are not affiliated to any political party, such as the National Education Union, the NASUWT and PCS, to name just three. Only 13 of the 48 unions in the TUC are affiliated to the Labour Party. My own union is affiliated, but it always makes it transparently clear when a member joins that their political contribution goes either to the Labour Link or to the non-affiliated section of the fund known as the campaign fund. New members can choose to pay into one or the other or both—or, until 2016, they could opt out. There were no subscription traps. New members were not misled. There were no barriers to opting out, and the opting out arrangement, as has been said, operated for more than 60 years through Labour, Tory and coalition Administrations before the 2016 Act.

It is with this in mind that I reflected on the contribution made by the noble Lord, Lord Burns, in reaching a way forward in 2016. I thank him for that, but I do not think that his amendment today should be progressed. It proposes that the 2016 arrangements continue under any new legislation. I ask the noble Lord not to pursue the amendment. Despite his good efforts, the 2016 arrangements have not proved a long-term solution for trade union political funds. They are gradually being drained of resources and, with that, so is the ability to campaign.

More to the point, in any democracy there will always be the threat that any incoming Government could put the clock back. There is always a very real possibility that we could get consistent ping-pong on many policies, not just on the political funds. Unfortunately, even if we leave things as they are, there is no guarantee that any change of government would not lead to another trade union Act more draconian than the 2016 Act. The possibility of consistent ping-pong in itself is not an argument for leaving things as they are; neither is it an argument for not returning to the principle of opting out, which operated for 60 years.

The Trade Union Act 2016 did what it intended to do. It deliberately placed considerable and costly burdens on trade unions, and it sought to reduce funding to the Labour Party. That was its purpose. But in doing that, it also compromised the ability of trade unions to provide a campaigning and political voice for working people in our country. That is why the Employment Rights Bill, unamended, is so important. That is why I ask noble Lords not to pursue the amendments to the political fund clauses of the Bill but to allow it to move forward unopposed.

Employment Rights Bill

Lord Burns Excerpts

Report stage
Wednesday 23rd July 2025 Lords Chamber

Moved by

[Lord Burns]

147: Leave out Clause 59
Member's explanatory statement
This amendment would retain the 2016 cross-party compromise (agreed by the House without a division) whereby new members of a union contribute to the political fund only if they have actively chosen to do so. That compromise was based on the conclusions of the Trade Union Political Funds and Political Party Funding Committee.

[Lord Burns (CB)]

My Lords, my amendment proposes removing Clause 59 from the Bill. This would maintain the current arrangements whereby members joining the union since the passage of the Trade Union Act 2016 contribute to its political fund only if they give their active consent to do so. These existing arrangements stem from the compromise reached by the Trade Union Political Funds and Political Party Funding Committee in 2016. The compromise was that unions would not need to obtain active consent from existing members to continue paying into the political fund but would be able to collect the political levy from only those new members who had given their consent and made an informed choice to do so. Additionally, all members were to be reminded annually that they could change their decision.

My involvement in the issue was not because of a long-standing historical interest in political funds, I emphasise; simply, I was asked to chair that committee. In the process, I gained insights into the history of trade union political funds and the arguments for and against opt-in and opt-out clauses when individuals need to exercise a choice.

The 2016 compromise prevented the fear of a sudden and potentially significant reduction in the income of trade union political funds, which could have severely damaged the Labour Party’s finances. While the then Opposition welcomed the compromise, many Conservative Members in this House and the House of Commons were disappointed that the requirement for active consent was not extended to existing members.

Consequently, I was taken aback when I learned that the new Government wanted to abandon the compromise and revert to the pre-2016 position. This Bill proposes returning to a position where all new members make automatic contributions to political funds unless they deliberately choose not to, with reminders only once every 10 years.

During the recent debates on this Bill in Committee, several arguments were put forward from the Government Benches to justify the proposed change. I find none of them convincing. The first argument was that this was merely returning to an arrangement that had lasted between 1945 and 2016. This is a weak argument. Many things have changed since 1945, including the generally accepted view of how to treat customers fairly. It is now recognised that, in most circumstances, customers or members should give clear consent, especially in situations involving active and ongoing participation.

We know individuals could be misled by small print and bureaucratic barriers. What was acceptable in the past is now viewed differently. Automatically signing people up to spend their own money without their active consent is no longer seen as acceptable today. Requiring members to act only if they do not wish to contribute is introducing a bias in the decision which can skew the outcome—in the union’s favour, in this case. Exceptions usually are limited to situations where there is a clear public benefit or where it is proportionately expensive or bureaucratic for people to register their non-consent. I do not think either situation applies here.

It is an exaggeration to say that this was a settled issue between 1945 and 2016. The Thatcher Government closely examined requiring active consent and were dissuaded from moving to a system of active consent only by an agreement with the unions that they would provide more information about the choice available to members.

During Committee, it became clear that the second main argument for this change was a concern raised by trade unions about a decline in contributions since the introduction of the requirement for members to expressly give their consent. But surely finding that contributions are less than desired is not an ethical reason to withdraw a right to consent; it is a temptation that should be resisted, as we have seen in many walks of life. When faced with a decline in revenues, most organisations first consider how to improve their presentation. They try to make a more compelling offer, spend more time educating members about the benefits or point out that, as in this case, the financial commitment is not large.

Instead, the proposal in this Bill is to resort to obscurity, automatically making members contributors to political funds without first having their active consent. To make matters worse, the plan is to ensure that they will not be tempted to escape and will be reminded of their right to reverse their decision only every 10 years. Many of us have unwittingly been on the receiving end of this practice with things such as low-cost insurance for household devices.

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[Baroness Jones of Whitchurch (Lab)]

That is what I said.

We are simply returning to the situation as it was pre-2016. I would add that the unions are already specifically regulated in the requirement to have a separate fund for spending on political purposes that is subject to many rules. There is no such requirement on many other membership organisations.

I turn to the amendment tabled by my noble friend Lord Davies of Brixton relating to Clause 62 on equality representatives. Trade unions have long fought for equality. We recognise that equality reps have a key role to play in raising awareness and promoting equal rights for all members, as well as developing collective policies and practices that will enable organisations to realise all the benefits of being an equal opportunities employer. New Section 168B(2)(a) therefore provides for the broad purpose for equality representatives to take paid time off for carrying out duties

“for the purpose of promoting the value of equality in the workplace”.

In addition, new Section 168B(2)(c) makes provision for

“providing information, advice or support to qualifying members of the trade union in relation to matters relating to equality in the workplace”,

and new Section 168(2)(d) makes provision for

“consulting with the employer on matters relating to equality in the workplace”.

Finally, equality representatives may also be eligible for time off under Section 168 of the 1992 Act, which includes time off for

“negotiations with the employer related to or connected with matters falling within section 178 … in … which the trade union is recognised by the employer”.

We believe that these measures are broad enough to include a range of activities, which encompass collective bargaining, negotiating with employers and representing members. I ask the noble Lord, Lord Burns, to withdraw Amendment 147.

[Lord Burns (CB)]

My Lords, I am grateful to all who have contributed to the debate, particularly the noble Baroness, Lady Finn, and the noble Lord, Lord Sharpe of Epsom, who added their names to the amendment. I am also very grateful for the meetings I have had with the Minister. However, I am disappointed that I have failed to move her thinking in any serious way on this issue.

I welcome the support of the use of active consent in making contributions to political funds. The noble Baroness, Lady Fox, made a very good point that unions should not be frightened of giving members a clear choice. From those who have disagreed we have heard very little in the way of new arguments for ditching the 2016 compromise, other than a desire to persuade members to contribute more by relying on their inertia.

I enjoyed the history lesson from the noble Lord, Lord Barber. I agree entirely that it is quite astonishing; as I discovered at the time of the committee, political funds were illegal prior to 1909. I agree with the noble Lord, Lord Whitty, about the need for an agreement on party funding. The issue is: which is the right mechanism until then? Is it the 2016 compromise or the 1945 model? The noble Lord, Lord Monks, said he is worried that in 10 years’ time all members will be covered by the 2016 compromise. He will not be surprised that I do not think that this is necessarily a bad thing.

I remain bewildered by the desire to go ahead with the proposal in the Bill. I do not think the compromise should last for ever, but it is surely preferable to the 1945 version. I am very disappointed that there is no appetite for finding a way of dealing with this that gives some hope that it will stand the test of time. I have heard no recognition that views on the ethics of this type of choice have moved on since 1945 and that the arrival of a digital world increases the options for dealing with this in a different way. Instead, what we have is a desire to go back to the 1945 mechanism. Therefore, I would like to seek the opinion of the House.