Employment Rights Bill

Lord Hunt of Wirral Excerpts

2nd reading
Thursday 27th March 2025 Lords Chamber

[Lord Hunt of Wirral (Con)]

My Lords, I begin by drawing attention to my interests as detailed in the register, in particular as a practising solicitor and partner at DAC Beachcroft.

I thank the Minister for opening the debate and we look forward to the maiden speeches of my noble friends Lady Cash and Lord Young of Acton, and the noble Baronesses, Lady Berger and Lady Gray of Tottenham.

I have always believed fervently in workers’ rights and trade unions. Indeed, as a young solicitor, I often acted for the Transport and General Workers’ Union in a wide variety of cases. By the late 1970s, however, by which time I was a Member of Parliament, it had become abundantly clear that something had gone seriously awry with the trade union movement. The unions seemed to be abusing their powers, pursuing not only the legitimate interests of their members but an overtly political agenda.

I remember being in the House of Commons when, in the final year of the Callaghan Government, the unions all but brought the country to its knees. A new settlement was needed. Successive Conservative Governments, between 1979 and 1997, gradually changed the nature of the social contract between employers, employees and the unions. Days lost to strikes tumbled from tens of millions a year to a tiny fraction of what they had been. Thanks to the more flexible labour market we had created, renewed economic growth brought a dividend of rising employment and falling unemployment far more quickly than anyone expected. That was not the Wild West. Indeed, workers’ rights and protections were often extended, not diminished.

The last Labour Government, under both Tony Blair and Gordon Brown, broadly accepted that renewed social contract and embraced the flexible labour market that serves both employers and employees so well. So, what has changed? Furthermore, what has changed during the passage of the Bill? It has had a brief lifetime, yet we have already had 160 government amendments in Committee in another place, including 11 new clauses and two new schedules. This farrago was followed by a further 40 new clauses and five new schedules on Report.

It was an extraordinary decision to run the progress of the Bill in parallel with a series of directly connected public consultations. As they showered us with amendments of their own, Ministers used their majority in the other place to defeat some very sensible ones from my own party and from the Liberal Democrats. More amendments are now promised—or should we say threatened? No one can convince me that there has been fair, effective and comprehensive parliamentary scrutiny of this legislation, which is scandalous when we think of the profound effects it is bound to have on British business and how our businesses operate.

To date, 11 government Bills, including this one, have included Henry VIII powers. This Bill contains 11 such powers. So great is the uncertainty this creates that a meaningful Second Reading debate is almost impossible. What, in fact, are the principles of this legislation? Whatever they are today, might they change significantly with further amendments, or when the Henry VIII powers are triggered? Ministers are, in effect, asking Parliament today to empower them to do whatever they decide to do, whenever they decide to do it.

Apparently, in total, the Bill contains 173 delegated powers. I was musing that, if Henry VIII were alive today, he might be tempted to use this kind of skeleton legislation to legalise uxoricide—but whatever. Why are Ministers so disdainful towards the concerns expressed by the Attorney-General in his Bingham lecture on the rule of law last October, when he warned that

“excessive reliance on delegated powers, Henry VIII clauses, or skeleton legislation, upsets the proper balance between Parliament and the executive”?

He recommended

“a much sharper focus on whether taking delegated powers is justified in a given case, and more careful consideration of appropriate safeguards”.

Perhaps the most chilling warning about the specific inadequacies of the Bill came from the Regulatory Policy Committee, which identified eight of the Government’s individual impact assessments as being not fit for purpose, six of which were in the highest impact measure category. Surely it is the principal responsibility of Ministers fully to think through the potential impact of legislation before unleashing it on the world. This Government have failed in that basic task.

Meanwhile, the Recruitment and Employment Confederation’s Voice of the Worker campaign vividly reminds us that temporary work is often a choice made by workers, not an enforced compromise. Its survey of temporary agency workers found that 79% of respondents appreciated the flexibility that temporary work provides, while more than two-thirds believe it affords them a better work-life balance. These values—flexibility and balance—should be celebrated and supported by us all, not jeopardised by half-baked laws. Workers should be empowered to engage in the workforce in ways that best suit their personal circumstances. We must ensure that legislation does not restrict their ability to do so.

Although the intention may be to increase security, these measures risk overregulating agency workers, who are already well provided for under the Agency Workers Regulations. Under current law, these workers are made aware of permanent vacancies and enjoy protections that balance flexibility with job security. Additional regulations could well tip this balance too far, ultimately harming the very workers who the Bill seeks to protect. I also wonder whether Ministers have fully considered the financial, economic and social impact that the measure would have on public bodies, especially in the National Health Service.

Let us consider the proposal around statutory sick pay eligibility. Reducing the eligibility criteria and requirement for SSP to just one day would increase financial pressure on employers, particularly those who employ workers on temporary contracts or in sectors that rely on flexibility. Employers now face the prospect of greater tribunal risk when managing employees’ sickness leave, which could act as a further deterrent to hiring.

Small and medium-sized enterprises are so often the driving force in our economy, delivering growth in production and jobs. They need our encouragement and support, not new burdens. They will inevitably be more hesitant about taking on new employees, if they fear facing immediate legal risks from day one. I implore Ministers always to look at proposals from the point of view of an employer making a marginal decision on whether to take on that extra employee. The proposed new union recognition rules would also hit SMEs disproportionately and, as I will argue on these Benches, unnecessarily.

I turn, as the noble Baroness did, to strikes and ballot thresholds. Under current law, unions must provide 14 days’ notice before a strike, allowing employers sufficient time to prepare contingencies and manage the potential disruption. The proposed change to reduce this notice period to just seven days raises significant concerns. Will this help to generate the much desired and much needed economic growth about which we hear—and have heard today—so much?

In response to the latest ONS labour market data, the Institute of Directors shared some deeply troubling data of its own. That data showed that 47% of business leaders facing higher national insurance bills plan to reduce employment as a result. Business hiring intentions over the next year remain around lows last seen at the height of the Covid-19 pandemic. Even the Government’s own rather feeble impact assessment concedes that this Bill will impose a £5,000 million cost on businesses. What did they offer in return? Unfounded, optimistic speculation that this legislation could lead to growth—with no evidence and no guarantee. Their own declared primary mission is economic growth and yet they put forward a policy that actively undermines it.

The Bill is not only anti-business but, in my view, anti-worker. If it passes in anything like its current form, it would be more appropriate to call it an unemployment Bill. The measures in the Bill will make it harder for existing businesses to thrive and near-impossible for new businesses to emerge. The result will be a stagnating economy, diminished opportunities and worse outcomes for workers right across the country. The only growth that this Bill would deliver would be growth in industrial strife, growth in administrative costs for business, growth in uncertainty, and, ultimately, growth in unemployment. Unless it can be seriously improved, on these Benches we will oppose this Bill all the way, in the best interests of the working people of this country.

Employment Rights Bill

Lord Hunt of Wirral Excerpts

Committee stage
Tuesday 29th April 2025 Lords Chamber

At first sight, Amendment 283 might seem like a long list but, in fact, it is not half of how this Bill will reach into working life. The amendment would require the Secretary of State to publish a code of practice that provides employers with guidance on complying with the Act. The code should set out best practice, compliance monitoring and enforcement procedures. It should ensure necessary consultation with stakeholders and would enshrine a review every five years. We need to see a draft of this code before this Bill progresses to its final stage; I would be happy to discuss with the Government how to make this happen. I beg to move Amendment 1.

[Lord Hunt of Wirral (Con)]

My Lords, briefly, I thank the noble Lord, Lord Fox, for bringing forward this important purpose clause amendment, which I must tell him—I know he is always surprised when I praise him—is a very cleverly worded amendment to which my noble friend Lord Sharpe of Epsom and I were very happy to add our support.

I do not know why this Bill has had to be rushed through within 100 days. Given the significance of this legislation, surely it would have been better if the Government had committed themselves to ensuring thorough and proper scrutiny. However, we have seen the introduction of 160 amendments on Report in the House of Commons—amendments which, in many cases, received no or little meaningful examination.

Even more concerning is the fact that the Government have tabled 27 amendments for Committee in this House. We have received a letter from the Minister warning us that there are more amendments in the pipeline on fire and rehire, the fair work agency, employment Bill time limits, trade union reform and maritime employment. What on earth is going on? Why was not this Bill properly prepared? This has meant that the letter to which the noble Lord, Lord Fox, referred is virtually saying to the House of Lords, “Please, on behalf of all the employers—and, indeed, all the businesses in the UK—we rely on you in the House of Lords to scrutinise this Bill properly”. I just do not think that this is the right way to treat Parliament. We owe it to the legislative process and to the public we serve to ensure that our scrutiny is neither rushed nor compromised.

No doubt the Minister will argue that a purpose clause is completely unnecessary. However, we respectfully disagree, and not only for the reasons raised by the noble Lord, Lord Fox. It is vital for the Bill clearly to articulate its overarching aims: not simply to modernise employment rights in name but to set out a clear ambition to create a fairer, more secure labour market; to encourage genuine co-operation between employers and workers; to protect rights and well-being in the workplace; to ensure proper standards for pay and conditions across sectors; and to guarantee robust enforcement of labour protections. I have to say that, without a purpose clause, this Bill risks being directionless and, worse, risks unintended consequences that neither workers nor businesses can possibly afford.

I think also—and I hope the noble Lord, Lord Fox, will agree—that a purpose clause is particularly important where there are a large number of delegated powers to make regulations within it. In effect, the Government are saying, “Please give us the power to do whatever we would like to do whenever we would like to do it”. The committees of this House have, time and again, urged Governments to turn their back on these Henry VIII clauses and present Parliament with clear cases to amend primary law, not do it through secondary legislation.

Well, there is growing concern about this Bill, which is why the British Chambers of Commerce, the Confederation of British Industry, Make UK, the Institute of Directors and, in particular, the Federation of Small Businesses, which between them represent thousands of businesses across the country, have published this open letter to the House of Lords, asking for urgent changes to the Bill. They did so because they are deeply concerned that, as drafted, the Bill will make it harder, not easier to create fair, secure and co-operative workplaces. They warn that the Bill will increase risk and uncertainty for businesses precisely at the moment when we need businesses to invest, to hire and support in particular those who are at the margins of the labour market.

I do not think that the substantive concerns of all the businesses quoted by the noble Lord, Lord Fox, have been listened to. I just hope that the Minister can respond when she winds up this debate. I look forward to the speeches from all sides of the House. I will not quote in detail from the letter, but it does remind me of the words of Milton Friedman. If I am ever to find myself quoting Milton Friedman, I suppose that this is the moment. He said:

“One of the great mistakes is to judge policies and programmes by their intentions rather than their results”.


Well, fine phrases about modernising employment rights and updating legislation are no substitute for carefully considered, properly scrutinised measures that deliver real-world improvement. So that letter from all those businesses is not a warning but a plea to this House. It is a recognition that we as the revising Chamber have a unique and critical responsibility to ensure that this Bill works. They are not closing the door on the Government but offering, at the end of the letter, to work with us all and with Ministers to help improve legislation.

In conclusion, if we are to get all these amendments, can we hear from the Minister how many more amendments we are going to get and when? The Government Chief Whip is constantly referring us to the Companion. I have never quoted from the Companion before, but it has pretty severe words for a Government who choose to table amendments at the last moment, without proper notice. So could we hear from the Minister what further amendments are planned, when we will receive them, and which parts of the Bill will be fundamentally altered? Here we are, at the start of Committee, still not knowing what the Government are proposing.

In an unguarded moment, the Minister disclosed to me that she has an implementation plan, which I understood from her was in draft. This House ought to see the draft implementation plan. Why can we not see it? Perhaps we could help the Minister produce the final draft. We should not get an implementation plan half way through Committee. Could we hear from the Minister on when we will see the implementation plan? A lot of businesses up and down the length and breadth of this country are totally uncertain about what the detail of this Bill will be. It is about time that we heard from the Minister about what the Bill seeks to do, what its purpose is and whether we can see it in its full form before we go any further with Committee.

[Lord Monks (Lab)]

My Lords, I will speak to Amendment 1 and avoid the temptation to engage in a mini-debate across the whole width. So far, I feel I have been sitting in a Second Reading debate. I have given speeches in this House before, reflecting similar sentiments to those in this amendment about fairness and co-operation. These are the words used in the amendment from the noble Lord, Lord Fox. I gave them in the context of the debates on Conservative anti-union laws, which we have addressed in this House in my time. Sadly, no one on the Conservative Benches, except for the noble Lord, Lord Balfe, who is in his place, paid any heed. The laws then proceeded to the statute book and the result was an imbalance in British employment law very much in favour of employers.

The Bill goes some way towards correcting that. Once it has been implemented, I hope we can look again at a system of mature collective bargaining of which we all can be proud. But first, we must replace the imbalance, and do so speedily, because it is glaring. Change is desperately needed; our labour market is characterised by high inequality—only two OECD countries have a bigger gap between rich and poor and between top earners and the very low-paid.

--- Later in debate ---

[The Parliamentary Under-Secretary of State, Department for Business and Trade and Department for Science, Information and Technology (Baroness Jones of Whitchurch) (Lab)]

My Lords, I thank the noble Lord, Lord Fox, for his detailed engagement with our Bill and for Amendments 1, 283 and 327. I thank all noble Lords who have contributed to this wide-ranging debate, which has revisited many of the debates that we had at Second Reading.

Amendment 1 seeks to insert a new clause of the beginning of the Bill to set out the overarching purpose and to provide a framework for understanding the aims of the legislation. I thank the noble Lord, Lord Fox, for his challenge on this issue, but it is important to reflect on why we are bringing the Bill forward and what we hope to achieve through it.

The plan to make work pay sets out a significant and ambitious agenda to ensure that workplace rights are fit for the modern economy, to empower working people and, importantly, to contribute to economic growth. Delivery of that plan was, as we have heard, a manifesto commitment and part of the mandate on which the Labour Government were elected. On 10 October, the Government fulfilled their manifesto commitment to bring forward legislation within 100 days of entering office by introducing the Employment Rights Bill.

The noble Lords, Lord Fox and Lord Hunt, and others have asked about the later amendments that have been tabled. I reassure noble Lords that these are technical amendments and that the Committee will have adequate opportunity to scrutinise them all properly. The noble Lord, Lord Hunt, and others asked about an implementation plan. I reassure noble Lords that that will be shared as soon as it is available. We agree that businesses need guidance on the timescale and implementation of the measures in this Bill. We are working at pace to ensure that they have that information.

There is strong support for the measures included in the Bill. The Institute for Public Policy Research found that every constituency in the UK has a majority or plurality of people who believe that workers’ rights should be strengthened. My noble friend Lady O’Grady mentioned the latest poll. In addition, the TUC’s polling and that of HOPE not hate of over 21,000 people across the political spectrum has found strong support for key policies in the Bill. More than seven in 10 of UK voters—72%—support a ban on zero-hours contracts. Three-quarters of voters support giving all workers the right to statutory sick pay and ensuring that it is paid from the first day. Three-quarters of voters support giving all workers protection from unfair dismissal from the first day in their job.

This is a comprehensive Bill which delivers on a clear mandate from the British public. Once implemented, the Bill will represent the biggest upgrade of workers’ rights in a generation. Good employers support this package, because many of them are already delivering these standards. What they do not want is to be undercut on an uneven playing field.

I can give a few examples; I know the Opposition like to ask this question. Centrica, the Co-op, Richer Sounds, Nationwide, IVC Evidensia and IKEA UK and Ireland have all given their support to the measures in the Bill, and a lot of SMEs have done likewise, so it does have resonance with the business community.

Modernising the world of work will raise standards and tackle undercutting so that businesses are empowered to compete in a race to the top. I can reassure noble Lords that the Government, of course, recognise the concerns about the costs to business. The £5 billion figure from our impact assessment is a top-end estimate of the costs, which will largely represent a direct transfer to the lowest paid in society, with the bottom end of the range close to £1 billion.

The costs, therefore, are likely to be under 0.4% of our national wage bill and could even be as low as 0.1%. Furthermore, improving workers’ well-being, increasing productivity, reducing workplace conflict and creating a more level playing field for good employers would grant significant benefits worth billions of pounds per year. That is why delivering the benefits of the Bill would offset the costs.

I can reassure noble Lords that a number of these measures, as I have already said, have strong support from businesses, and we will of course carry on consulting them as we put these plans into practice to ensure that they are as effective as possible. The noble Baroness, Lady Stowell, mentioned the tech sector and will know that I am very minded of this. We will continue to engage with the tech sector on a regular basis to make sure that it contributes everything it can to the Government’s growth strategy.

The noble Lord, Lord Fox, and others have mentioned SMEs, and we will have the chance to debate this later in the Bill. In short, we do not agree that there should be two-tier employment rights: employment rights for all is a fundamental principle.

The noble Lord, Lord Empey, and the noble Baroness, Lady Stowell, talked about skills. We are absolutely committed to a new skills agenda, which is why Skills England is modernising our skills provision. It is an area where, traditionally, the unions and employers have made common cause to make sure that the upskilling of the workforce happens on a comprehensive basis.

This Bill shows the Government’s commitment to strengthening collective bargaining rights and trade union recognition. Our approach will foster a new partnership of co-operation between trade unions, employers and the Government. In response to the point made by the noble Lord, Lord Fox, our reforms remove hurdles that frustrate the voices of workers, but trade unions will still need to win a majority of workers’ votes in a ballot to be recognised by an employer. If workers do not want to be represented by a trade union, they will have the option to vote against recognition in that ballot.

On Clause 1 and the proposed list of priorities, I agree with my noble friends Lord Hendy and Lady Carberry that the purposes are already covered in the Bill. My noble friend Lord Hendy pointed out that the Long Title already addresses the purposes within the Bill, and as my noble friend Lady Carberry pointed out, the list is not exhaustive. If we are to have a list, it would need to be a whole lot longer than it is at the moment and cover a whole range of other aspirations already covered in Labour’s Plan to Make Work Pay.

The noble Baroness, Lady Neville-Rolfe, raised other issues that could be included in that list. Again, I assure her and others that all these issues have been consulted on extensively in the Bill. I would like to reassure noble Lords that there is no need for such a clause to be inserted to achieve this aim. The Explanatory Notes set out the purpose of the Bill clearly and provide further detail on the aims of the legislation. These notes were updated when the Bill transferred to this House and will be updated again when it receives Royal Assent. The Government have also published a series of fact sheets, which are available on GOV.UK and aid the understanding of the Bill’s aims.

Finally, from a legal perspective, inclusion of such a clause could risk producing unintended consequences on the interpretation of specific provisions within the Bill, which have been drafted to achieve the particular purposes concerned. While I understand what the noble Lord, Lord Fox, is trying to achieve, and I appreciate the debate that he has created, I hope I have persuaded him that it is not appropriate to include this in the Bill.

Amendment 283 seeks to require the Secretary of State

“to publish a code of practice providing employers with guidance on complying with the Act”.

This has had much less attention in the debate but, nevertheless, I will attempt to address the concerns that the noble Lord raised.

We have consulted and remain committed to consulting widely on the detail of implementation. The Government have also committed to ensuring that, where appropriate, guidance is published to ensure that all stakeholders have the information they need to make necessary adjustments. However, a Bill-wide code of practice, as suggested in the amendment, would be duplicative of the policy-specific guidance and codes of practice that the Government will already produce to support workers, employers and trade unions in implementing the reforms.

There is existing provision for the issue of guidance and codes of practice across employment law. Where relevant, the Bill amends those provisions to reflect that they will need to be updated to take account of the changes made by the Bill. This includes codes of practice issued by ACAS under the Trade Union and Labour Relations (Consolidation) Act. Such codes are subject to consultation requirements and must be laid in draft in both Houses for approval, and we are already working closely with ACAS to plan ahead for this work.

Where new statutory guidance is required, this is also provided for, such as in Clause 30, which inserts new Section 83D into the Procurement Act to make provision for the issue of codes of practice on relevant outsourcing contracts by appropriate authorities.

By requiring a single Bill-wide code of practice, this amendment would also risk delaying the Government in offering certainty on the details of policy and regulation on individual issues as they become available. I hope I have persuaded the noble Lord that this would therefore result in duplication and unnecessary delay.

Amendment 327 would prevent the implementation of measures in the Bill until the point at which the Government produce a Bill-wide code of practice. Some measures in the Bill will not require any further guidance before they are implemented—for example, the repeal of the Strikes (Minimum Service Levels) Act 2023. Delaying the date on which these measures can commence would unnecessarily delay the point at which workers can benefit from measures in the Bill.

Codes of practice are used to provide guidance to employers on how to comply with employment law. By nature they are detailed, building on and clarifying requirements set out in statute. There are several measures in the Bill where further consultation will be required to develop regulations setting out key details of reforms. Within six months, it would not be possible for all the outstanding policy details to be finalised to inform the content of a Bill-wide code of practice. Codes should bring clarity, but these timelines would risk patchy or unclear content if we were to go ahead on the basis of these amendments.

I agree with the need to ensure that workers, trade unions and employers are sufficiently supported for the implementation of the Bill, but this amendment is unnecessary and duplicative. I hope I have persuaded the noble Lord that the codes of practice that he envisages would not help to provide the detailed guidance that employers and workers require. I thank him for raising the issue, but I hope I have persuaded him not to press those amendments.

[Lord Hunt of Wirral (Con)]

The Minister has shared with the Committee that there is an implementation plan. As we are now moving to consider each clause, the first few in particular, it would be helpful for the Committee to be made aware of the part of the implementation plan that governs each and every clause. Is she able to share it with the Committee and, if so, by when? Might we at least see a draft of the implementation plan, so that businesses across the UK know what lies ahead?

[Baroness Jones of Whitchurch (Lab)]

I know the noble Lord has already raised this, and he tempts me, but there has to be further consultation. He will understand that. Part of the legislation obviously requires further consultation to take place. We are still looking at the timescales for all this, and we obviously understand the need to provide guidance as soon as we can, but what I can say that will be reassuring to everybody concerned is that this will be a phased process; this is not a day-one process. We just need to make sure that the phasing of all this makes sense for employers so that it can be done on a proper basis and with the appropriate guidelines behind it. We are working on it, we will share it as soon as we can, and we understand the need for it, but it is not available at this time.

--- Later in debate ---

[Baroness Kramer (LD)]

My Lords, I am channelling the noble Lord, Lord Fox, who has been called away. He, on behalf of these Benches, cannot accept a two- tier workplace in regard to employment rights, which obviously form the content of this Bill, so we will not be supporting these amendments.

[Lord Hunt of Wirral (Con)]

My Lords, I am very grateful to the noble Baroness, Lady Kramer, for setting out the position so clearly, but I am particularly grateful to my noble friend Lady Noakes because, as a result of her moving the key Amendment 5, we have had a remarkably positive debate about what I believe is the lifeblood of the UK economy, namely the small and medium-sized business sector. The noble Lord, Lord Londesborough, of course, is a great authority on all this, and it was good to hear from the noble Lord, Lord de Clifford, as well.

When we reflect for a moment on the speeches that have been made in this debate—apart from that of the noble Baroness, Lady Kramer—we have not had any contributions from the Government Benches. But, as my noble friend Lord Leigh of Hurley pointed out, the most important contribution will be made by someone who really does understand. The noble Lord, Lord Leong, knows all about small businesses, and I am thrilled and delighted that he is summing up the debate because he understands what so many of my colleagues have tried to point out. The noble Baroness, Lady Neville-Rolfe, said that bureaucracy can get in the way of success. Look at the amount of rules and regulations and bureaucracy.

I agreed with all my noble friends, including my noble friend Lord Ashcombe when he pleaded for a sensible and measured response. We all want to see bereavement leave—all good employers allow for bereavement leave. We want to see rights established very clearly, but my noble friend Lady Verma pointed out that if we impose them on the small and medium-sized sector in the way that my noble friend Lady Noakes outlined, three, four or five employees will suddenly have to deal with all this legislation.

Let us remind ourselves of the importance of small businesses. As several of my colleagues pointed out, at the start of last year there were 5.45 million small businesses with up to 49 employees, making up a staggering 99.2% of the total business population in the UK. We are talking about a massive sector, and therefore we have to worry and concern ourselves about the effect of the Bill. As the Federation of Small Businesses put it, in its current form the Bill risks becoming nothing short of a disaster for small and micro-businesses.

The noble Baroness from the Liberal Democrat Benches spoke about a two-tier workforce system, which those Benches object to. But as my noble friend Lady Noakes pointed out, we do in fact have tiering alive and well throughout the UK economy. It is not trying to impose one size fits all; it is recognising that over 99% of businesses in this country are small and cannot possibly cope with the burden of this Bill.

It just so happens that I already have a quotation from the noble Lord, Lord Leong, which I readily move to. We have heard from the Government on multiple occasions that they are committed to supporting SMEs and ensuring that they are not burdened with excessive costs or red tape. The noble Lord, Lord Leong, made a very important point during the passage of the Product Regulation and Metrology Bill:

“we do not want to burden SMEs with additional regulatory or financial cost”.—[Official Report, 25/11/24; col. GC 138.]

What wise words: we would love to hear those words from him again tonight. He will realise that the reality of this Bill is starkly different. The only thing this Bill seems to do for SMEs is to burden them with additional regulatory and financial costs. It is incredibly difficult to reconcile the Government’s stated intentions with the actual impact this legislation will have on small and micro-businesses across the country.

I know that my noble friend Lord Sharpe of Epsom and I have Amendment 282 in this group, but I do not want to go into it. I was taking the old Companies Act definition, and I do not need to go into all the findings of the Bolton committee and all those who have sought to define this, because I think my noble friends have done a great deal to define small and medium-sized enterprises.

We just need to know what the Government intend to do to alleviate the burden on small and micro-businesses. The impact assessment has highlighted the significant challenges that these businesses will face in implementing these reforms, and at the moment there is no adequate plan to support them.

I would like to ask the Minister these questions. First, will he please outline what the three main expected benefits of this Bill will be for small and micro-businesses? Secondly, how will the Government support small businesses in complying with the provisions of this legislation? What kind of guidance, training and resources will be made available to ensure that these businesses can navigate the new regulations without inadvertently falling foul of the law? Finally, can the Minister provide an assessment of the risk of unintentional non-compliance by small businesses? What steps are the Government taking to mitigate this risk and ensure that these businesses are not unduly penalised as a result of a lack of guidance in the legislation?

The Government have not consulted the small and medium-sized sector. If they have, can we please have a great deal more detail on what their conclusions were? If they have not consulted, will they please do so now?

[Lord in Waiting/Government Whip (Lord Leong) (Lab)]

My Lords, I thank all noble Lords who contributed to this group of amendments with such passion. The noble Baroness, Lady Noakes, together with the noble Lords, Lord Sharpe and Lord Hunt, tabled several amendments—Amendments 5, 124 and 282—that seek to remove micro-businesses and small and medium-sized businesses from the scope of large sections of the Bill.

Employment Rights Bill

Lord Hunt of Wirral Excerpts

Committee stage
Tuesday 29th April 2025 Lords Chamber

[Baroness Kramer (LD)]

My Lords, I am going to stick with being very brief. We have had three exceptionally powerful speeches. Amendment 16 is, in a sense, tackling a subset of a debate that this Committee has already had on Amendment 7 in the name of my noble and good friend Lord Goddard. I hope that the Government are beginning to accept that not all work comes in steady flows; it can have peaks and troughs and be disrupted by events way beyond anybody’s control. I hope that the Minister is going to take this away and work out how the current drafting needs to change in order to make the necessary allowances, whether it is for theatres, festivals, farmers or food and drink. A whole series of activities that experience those irregular patterns must be incorporated into this Bill.

[Lord Hunt of Wirral (Con)]

My Lords, I agree with the noble Baroness, Lady Kramer, that we need to brief as we have debated this area already. But we do have a great debt of gratitude to my noble friend for bringing forward this amendment. He was, of course, a distinguished Minister for the arts. I do not think people have yet recognised the dangers of one size fits all.

We are very grateful to the noble Earl, Lord Clancarty. I join with him in wanting a detailed impact assessment, particularly for the instance he gave of front-of-house workers. I do not believe that the effect on creative industries has been properly assessed so far as this Bill is concerned, and, as the noble Lord, Lord Berkeley of Knighton, said, there is a need for flexibility.

The theatre industry has only just now recovered—or perhaps it has not yet recovered—from the effects of the Covid-19 pandemic. The last thing it needs now is to be hit by this crude instrument of a Bill, which makes no allowance for the unique nature of the work that it does, and the flexibility that is necessarily inherent in how it delivers for audiences. I really do want to hear from the Minister the extent to which theatres—the larger groups, such as ATG and Delfont Mackintosh, but also small and independent theatres—have been consulted. To what extent have they been consulted about the effects of this Bill?

I will finish off with five questions for the Minister. First, does the Minister accept that the right to guaranteed hours as drafted risks reducing work opportunities for the very people it claims to support, such as students, carers, disabled workers, et cetera? Secondly, can the Minister explain how theatres and other seasonal or project-based employers are meant to reconcile guaranteed hours with programming closures, touring breaks or production gaps?

Thirdly, what modelling have the Government done to assess the potential job losses or reduced shift allocations that could result from this policy, and will they please publish that modelling? Fourthly, why have the Government ignored the clear expert evidence submitted by the Society of London Theatre and UK Theatre to the Public Bill Committee? Finally, does the Minister seriously believe that this legislation embraces inclusion and opportunity for the creative sector, when the sector itself is warning that it will do precisely the opposite?

[The Parliamentary Under-Secretary of State, Department for Business and Trade and Department for Science, Information and Technology (Baroness Jones of Whitchurch) (Lab)]

My Lords, I thank the noble Lord, Lord Parkinson, for tabling Amendment 16, which would require the Secretary of State to have regard to sector-specific work patterns when making regulations relating to the right to guaranteed hours. I am grateful to all noble Lords for their contributions and for highlighting the sometimes unique employment practices that occur in the creative sector and, in particular, the theatre sector.

In response to the noble Lord, Lord Hunt, I would say that we have engaged extensively with the Society of London Theatre and are happy to carry on doing so. We appreciate that some sectors—including the theatre sector, which is highlighted in the noble Lord’s amendment—do have fluctuating demand across the year.

This is a sector that I know all noble Lords recognise we need to support, for all the reasons that the noble Lord, Lord Parkinson, said, particularly for social value reasons. We therefore want to take note and make it right for the sector.

I reassure the Committee that flexibility is already built into the Bill to address issues of seasonal demand. There are several ways under the Bill that an employer could approach that issue while upholding the new rights to guaranteed hours depending on the circumstances, particularly by using limited-term contracts where that is reasonable. Those who are offered guaranteed hours will be able to turn those down and remain on their current contract or arrangement if they wish. Furthermore, through the Bill we have also allowed for employees and unions to collectively agree to opt out of the zero-hours contract measures. Unions can make these deals based on their knowledge of the industry and with a holistic view on what is best for their workers.

We will ensure that the needs of different sectors are considered when we come to design the regulations. We will continue to work in partnership with employers across the different sectors, their representatives, the recruitment sector and the trade unions to develop those detailed regulations, and we will provide clear guidance for both employers and workers in advance of implementing these measures.

The amendment from the noble Lord, Lord Parkinson, had a new concept of available hours for sectors with varying seasonal demand. We would push back on that issue. It could risk creating a two-tier guaranteed-hours framework for workers in sectors with more or less seasonal fluctuation. We believe that the reference period provided for in the Bill will ensure that qualifying workers are offered guaranteed hours that reflect the hours that they have previously worked.

I hope that, in that short contribution, I have been able to persuade the noble Lord that we are aware of the issues and are on the case. We feel that there is considerable flexibility in the Bill as it stands. We are happy to have further discussions. As we have heard from noble Lords, there are a range of issues and a range of options here, so there is not just one way of solving this problem. We are happy to get round the table and talk some more. We feel that, as the Bill is currently designed, it answers the concerns that are being raised with us, but we are happy to talk further. I therefore hope that, on that basis, the noble Lord will be prepared to withdraw his amendment.

Employment Rights Bill

Lord Hunt of Wirral Excerpts

Committee stage
Thursday 8th May 2025 Lords Chamber

Moved by

[Lord Hunt of Wirral]

19A: Clause 1, page 10, line 3, at end insert—
(c) in determining whether it was reasonable to enter into a limited-term contract, regard must be had to the employer’s operational circumstances and information available at the time the contract was made, including—(i) genuine short-term business needs or uncertainty,(ii) seasonal, project-based, or event-based fluctuations,(iii) relevant financial or staffing forecasts, and(iv) industry norms or practices relating to temporary contracts.(d) a decision to enter into a limited-term contract must not be considered unreasonable solely because subsequent business conditions changed in a manner not reasonably foreseeable at the time the contract was entered into.”Member's explanatory statement
This amendment clarifies that the reasonableness of entering into a limited-term contract should be assessed based on the employer’s operational context and the information available at the time of contracting. It lists specific factors that may be relevant to that assessment and states that unforeseeable changes in business conditions after the fact should not, by themselves, render a decision unreasonable.

[Lord Hunt of Wirral (Con)]

My Lords, with Amendments 19A, 20 and 21 in my name and in the name of my noble friend Lord Sharpe, we return to guaranteed hours. As drafted, our concern is that the Bill risks creating rigidity which does not properly reflect the real-world operational needs of businesses across key sectors of our economy, particularly retail, hospitality and tourism, all of which contain seasonal work.

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[Baroness Jones of Whitchurch (Lab)]

My Lords, I thought I had already offered to have further discussions, but I take the noble Lord’s point.

[Lord Hunt of Wirral (Con)]

My Lords, I think my noble friend Lord Lucas and the noble Lord, Lord Fox, were looking for the draft regulations. I do not think I need to remind the Committee of my declaration of interests; at Second Reading, I reminded the House that I am still a practising solicitor. It is no accident that, last week, City AM—a newspaper circulated widely through the City—said that the Bill is the biggest boost for the legal profession that anyone had ever seen. Many more lawyers will be needed to wade through the complexities of the Bill.

In particular, as my noble friend just pointed out, we are constantly debating the Government’s power to introduce regulations, but Parliament is not allowed to see those regulations when it passes the primary legislation that gives Ministers the power, after consultation, to do whatever they wish whenever they wish to do it. We are going to have this time and again in this series of debates. Surely it is right that, if the Government are taking the power to introduce detail—in particular by amending primary legislation—we should see that detail, if only in draft, before we decide to give that power to Ministers.

[Lord Fox (LD)]

I do not know whether I am allowed to intervene on this, but I wonder whether the noble Lord heard the Minister say that the Government are consulting on draft regulations. Perhaps he might ask the Minister to share those draft regulations with us during the process of consultation.

[Lord Hunt of Wirral (Con)]

I completely agree and am very grateful to the noble Lord, who introduced the whole concept of “lumpy”. As well as “lumpy”, we are all talking about “flexible” and he also said “fluctuating”.

This has been a very helpful debate. I particularly enjoyed my noble friend Lord Moynihan of Chelsea describing the history of the introduction of the minimum wage and how it gave rise to zero-hours contracts in the first place. It is a reminder that we have to be careful every time we take a key step down the road to creating more employment law, as we have to be mindful of the consequences.

I agree with the noble Lord, Lord Londesborough, that we have to keep thinking of the start-ups and scale-ups, and the effect that this legislation will have on them. It was good that my noble friend Lady Noakes reminded us of the truth behind the Low Pay Commission 2018 Report that small and micro-businesses, as she put it to the Committee, need flexibility. My noble friend Lady Coffey reminded us that one’s job quite often depends on whether it is raining, as she put it. I think it was Mark Twain who once wrote that, in England, everyone talks about the weather but no one ever does anything about it. It is a fact that demand often fluctuates according to the weather and this was a good reminder of that.

I welcome the speech from the noble Lord, Lord Hendy. His four points were key; I accept them and will carefully ponder each one—particularly his point about escape routes. Our purpose—mine and that of my noble friend Lord Sharpe of Epsom—is to ensure that we do not need escape routes, because we will get a law that fits the way in which the economy can grow and be more competitive. That is what it is all about. It is not about short-term contracts being the answer here and another form of contract being the answer there. Most employers want stability so that they can look forward with confidence.

How right the noble Lord was to remind us of the importance of small and medium-sized enterprises. It must surely be a worry in his mind as to the effect this onerous Bill will have on those small and medium-sized enterprises looking to grow and expand that do not have an HR department that can set out for them exactly the way ahead through all the bureaucratic routes they have to follow. They want to be able to grow and expand without carefully checking which rulebook applies. They, of course, always allow bereavement leave. All the employers I have known, when there was a tragedy in a member of their workforce’s family—I am not talking about just my clients but across the whole sector—did, of course, allow people time off. Therefore, we should not be establishing rigidity.

This is where I find myself in total agreement with the noble Lord, Lord Fox: we do not want a two-tier system. However, as my noble friend Lady Noakes pointed out on our previous Committee day, there are various tiers already in the tax system. The exemption I sought in Amendment 21 surely does not in any way undermine the rights of workers but gives the Bill the flexibility it needs to succeed in practice. We have heard in this debate and from businesses across the country that a rigid one-way system for guaranteed hours simply does not reflect the way in which large parts of our economy function. Retail, hospitality, tourism, logistics, seasonal industries—all rely on flexible staffing, and they operate in environments that can shift rapidly, sometimes overnight.

I plead again with the Minister that these amendments provide a narrow, principled route for employers to propose changes: not to walk away from commitments but to respond when there is a genuine and material change in business operations. No retaliation, no loopholes, just a basic safeguard to ensure that businesses are not locked into obligations that are no longer viable.

Let us be honest, if employers are not able to make changes in response to real pressures—a drop in demand, a loss of control, over-capacity—they are far less likely to offer guaranteed hours in the first place. That is not speculation; it is what we are hearing from so many of those making representations about the Bill at the present time. The result is clear: fewer jobs offered, fewer guaranteed hours and fewer opportunities, especially for the very people who rely on flexible and part-time work. That means young people, students—who we will come to in a moment—workers with disabilities, carers and, of course, those trying to get their foot on the ladder.

Finally, I agree with my noble friend Lord Sharpe that it would be helpful to sit down with the Minister and her colleagues to see if we can find a way through. Otherwise, we shall have to return to this on Report. In the meantime, I beg leave to withdraw the amendment.

Amendment 19A withdrawn.

Moved by

[Lord Hunt of Wirral]

19B: Clause 1, page 10, line 26, at end insert—
“(13) The duty to offer guaranteed hours under Section 27BA(1) does not apply to workers who are full-time students.”Member's explanatory statement
This subsection provides that the duty to offer a guaranteed hours arrangement under Section 27BA(1) does not apply to workers who are full-time students.

[Lord Hunt of Wirral (Con)]

My Lords, as I indicated, we now return to students and the guaranteed-hours exemption for full-time students. Amendment 19B is in my name and that of my noble friend Lord Sharpe of Epsom.

At Second Reading, I heard the Government’s intention, as part of their growth agenda, to get young people back to work who are not in education, employment or training—referred to as NEETs. Retailers provide flexible and part-time jobs tailor-made for people coming off benefits and the nearly 1 million 16 to 24 year-old NEETs. However, the evidence available clearly shows that the guaranteed-hours reforms, as currently drafted, fail to realise the realities of student employment.

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[Baroness Jones of Whitchurch (Lab)]

My Lords, this has been a useful debate on the subject of those who may be made exempt from the scope of the right to guaranteed hours. First off, I say to the noble Lord, Lord Hunt, that it is quite right that the Government have a detailed plan to get young people into work and training. Of course, we want to provide new opportunities for all young people, and we are determined to do that.

Amendment 19B in the name of the noble Lord, Lord Sharpe, seeks to take workers who are full-time students out of the scope of the right to guaranteed hours. I say to the noble Lord, Lord Hunt, that the Government appreciate that zero-hours contracts or those sorts of arrangements can work well for many full-time students, who desire the flexibility that they provide. We have heard that from around the Chamber this afternoon. The noble Lord, Lord Hunt, talked about term-time or seasonal work, but I urge him to look back through the previous debates we have had and the comments I have made, because there are a variety of ways in which employers can offer that flexibility of contract and the limited-terms contracts that could address those term-time only or seasonal work issues. I am not persuaded of his argument in that regard.

I say to the noble Lord, Lord Jackson, and the noble Baronesses, Lady Lawlor and Lady Coffey, that there are workers who nevertheless are full-time students, and they can still experience that one-sided flexibility, similarly to the workers who are studying part-time. It seems disproportionate to exclude workers from the scope of that right simply on the basis that they are enrolled in full-time studies. Full-time students may value guaranteed hours to help them manage their job around their studies or arrange their childcare in the same way as those in full-time work.

I think there is an assumption in this debate that we are talking only about a particular age group of people and that it is a group of young people who are earning some extra beer money. This is far from the case. Many full-time students are mature students with family or other caring responsibilities, or even simply with rental or mortgage commitments. For those people, guaranteed hours can be a financial lifeline. According to a 2024 TUC poll, the majority—80% of students on zero-hours contracts—also reported that they had experienced difficulties managing study and education alongside their work. They certainly, in this generation, try to manage both of those a lot more than they did in my generation, and it is now much more expected that young people will work alongside their study. Many of those students want the opportunity to have regular hours to avoid the burden of incurring long-term student debt, which they would otherwise take into their ongoing working life. As we have said, it is entirely up to the student to say what is right for them, but there are very good reasons why the guaranteed hours should apply to all people and we should not make an exemption for students.

However, as we noted, flexibility for workers is important and the Government are not seeking to change that, where workers value that flexibility and have some benefit from a zero-hours contract. As I say, that is why workers who are full-time students and want to retain their zero-hours contracts or arrangements will be able to do so by rejecting the guaranteed-hours offer. They can accept it or reject it.

However, it is the Government’s view that they should be able to choose, based on their individual circumstances, whether to accept a guaranteed-hours offer, rather than being denied that right, as the noble Lord’s amendment seeks, purely on the basis of the fact that they are studying. I hope the noble Lord will look again at his amendment. I feel as if it is penalising young people and students in a way that feels quite unreasonable in the circumstances where everybody else is entitled to this right. Therefore, I hope he will be prepared to withdraw the amendment.

[Lord Hunt of Wirral (Con)]

My Lords, this has been a valuable debate; I agree with the Minister. Indeed, I welcomed her admission that zero-hours contracts work very well for students and are valued by them. I was interested in the TUC survey. All the surveys I have seen so far tell this Committee that full-time students do not want to lose zero-hours contracts.

It may be that the Minister will say, “Why is this amendment necessary, because they will not request full-time employment?” However, under the Bill, the employer has to work out how the business will be able to offer someone on a zero-hours contract full-time employment as and when they request it. It comes later, of course, when we are moving amendments, that we can say that it should not be the duty of the employer to give the opportunity of full-time employment; it should be the right to request full-time employment. What I think we are arguing about is whether all employers will have to go through the process in advance of any request being received. Under this legislation, they have to work out how they will be able to respond positively to an offer.

My noble friend Lady Lawlor shared the real-life experience and the way in which various students have taken advantage of these contracts. But what if they are not going to be offered them and given the opportunity of working as and when, in the flexible, lumpy way they want to organise their studies, as my noble friend Lord Jackson of Peterborough, pointed out? I thank him for going down memory lane; it was a fascinating glimpse of life as a stacker. I suppose all of us will remember what we did as students. I volunteered. I crossed Whiteladies Road in Bristol and offered my services to the BBC. The BBC took me on as a freelance newsreader.

[Lord Goddard of Stockport (LD)]

As everybody does.

[Lord Hunt of Wirral (Con)]

Yes. I had to turn up at 5 am and then read the news.

[Lord Fox (LD)]

I am excited by the noble Lord’s anecdote, as I was by other noble Lords’ anecdotes, but would he perhaps concede that that was several years ago and the employment market, and indeed the student body, might have changed somewhat since then?

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[Lord Hunt of Wirral (Con)]

Sadly, yes. I was on a student grant and they were abolished, so I cannot draw too many analogies. My noble friend enticed me down memory lane.

I just wanted to see what the adverse effect of this amendment might be if we were to exclude full-time students. My noble friend Lady Coffey quite rightly reminded us that there is such an exemption in other legislation, such as that around universal credit. Therefore, the Minister will not be blazing a new trail; she will merely be responding to the very fact that, under legislation, full-time students do not necessarily fit into the pattern laid down by the Bill.

I am sure we will return to this. In the meantime, we can hardly wait for this meeting with the Minister, in which she will take us through the way this will all operate to cover flexible and lumpy employment. While reserving the right to return to the issue on Report, I beg leave to withdraw the amendment.

Amendment 19B withdrawn.

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[Lord Leong (Lab)]

Although the noble Lord expects me to give him a specific timeframe, I cannot do so now. I will consult with my officials and come back to him.

[Lord Hunt of Wirral (Con)]

On the first day in Committee, we already discussed the implementation plan of the Minister, the noble Baroness, Lady Jones of Whitchurch. We then moved on to discuss the draft implementation plan, and the noble Baroness gave us a commitment. Can the the noble Lord, Lord Leong, update that commitment? By when will we see the draft implementation plan?

[Lord Leong (Lab)]

I give the noble Lord my commitment that it is very much a work in progress.

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Moved by

[Lord Hunt of Wirral]

33: Schedule 1, page 167, leave out lines 28 to 30 and insert—
“(2) Determining whether reasonable notice of a shift was given must include an consideration of—(a) whether the work-finding agency offered the shift to the agency worker as soon as reasonably practicable after receiving confirmed information about the shift from the hirer in accordance with Regulation 18 of the Conduct of Employment Agencies and Employment Businesses Regulations 2003 (S. I. 3319/2003);(b) any time reasonably required by the agency to carry out suitability assessments in accordance with those Regulations.”Member’s explanatory statement
This amendment clarifies how “reasonable notice” should be assessed for agency workers. It ensures that the work-finding agency must offer the shift to the worker as soon as reasonably possible after receiving confirmed details from the hirer, and after the agency has conducted suitability assessments, in line with relevant regulations.

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[Lord Hunt of Wirral (Con)]

My Lords, as we now move to consider reasonable notice in agency work, I will speak to Amendments 33 and 36 to 38.

Unfortunately, and despite all their show of consultation, I believe the Government have failed to realise how agencies operate in the labour market, so once again the drafting of the Bill shows the failure of a one-size-fits-all approach. The challenge we face in the context of the Bill is clear. Work-finding agencies operate in a highly dynamic and often unpredictable environment, where the flow of information from hirers is essential in matching workers to available shifts.

This brings us to the core concern. Agencies often rely on information from hirers about the availability and cancellation of assignments. Without timely and sufficient details from hirers, agencies cannot predictably or properly fulfil their role. Therefore, any new obligation to provide reasonable notice for agency workers must consider the time taken for agencies to receive this confirmed information and make the necessary arrangements and assessments.

Regulation 18 of the Conduct of Employment Agencies and Employment Businesses Regulations 2003 lays down that an agency cannot

“introduce or supply a work-seeker to a hirer unless the agency or employment business has obtained sufficient information”

to assess the suitability of the worker for the role in question. The issue here, therefore, is straightforward. Agency workers often find themselves without income as a consequence of cancellations initiated by hirers, yet agencies are held financially liable for those decisions, even though they have no control over the cancellations.

To illustrate the risk, let me provide a scenario. A work-finding agency places an agency worker with a hirer for a shift. However, due to unforeseen circumstances, the hirer cancels the shift at short notice. The agency, having no control over the cancellation, is still required to compensate the worker. The financial burden therefore falls on the agency, despite the cancellation being the decision of the hirer.

How will this amendment help to ensure that small and medium-sized agencies are not disproportionately impacted—that is what we seek to do here—bearing in mind the financial responsibility associated with hirer-induced cancellations, particularly when the business in question may already be financially vulnerable? Do the Government believe that it is justified to place the financial burden of a cancellation or curtailment on the agency when the failure to provide notice lies entirely with the hirer?

I believe that the Minister understands the complexities of the agency-worker relationship, but the Bill in its present form does not make proper allowance. How do the Government propose to monitor and enforce the full accountability of hirers for failures in notice arrangements? This is an issue that has to be faced, given the rigidity of the legislation we are required to consider under this Bill. I beg to move.

[Lord Goddard of Stockport (LD)]

My Lords, I am pleased to speak to this group of amendments, which seek to clarify the framework governing agency workers, and I have some sympathy with the views of the noble Lord, Lord Hunt, on this matter. It seems to me that a third person looking into this process will see the Labour Party trying to protect employees and give them 100% rights and the Conservatives trying to ensure that small and other businesses have a level playing field to employ, create jobs and grow the economy, which I thought was the Government’s objective. I wonder why, with this employment Bill, we cannot get a little closer to dealing with the mechanics.

The answer that the Minister gave to my probing amendment baffled me. I wanted to get up to ask him to explain what he said to me. Millions of people who listened to it or who read Hansard tomorrow will not have a clue. As my lumpy noble friend has said in previous debates, we seek clarity before the Act comes into power. We need to know these things. I spent four years on the Secondary Legislation Scrutiny Committee. The watchword on that committee was quite clear: do not give Ministers unfettered powers. What is in the tin of a Bill is what it says on the front of the tin of a Bill. I wonder whether this tin will say “tomatoes” but when you open it, you will have carrots—a problem for somebody that does not eat carrots.

Running through this group of amendments, we on these Benches are trying to bring the parties together to understand that it is a two-way thing. I have been a committed trade unionist for 25 years. I have also run a business and employed 20 people. Those two things are compatible, but they are complicated, because you have different pressures from a different standpoint. As with all legislation, we try to move it through by being sensible and finding common ground for what the trade union movement wants, what the Government want and what employers want. I had guests in yesterday who were asking about the Bill. I roughly outlined it, and they could not believe it. They employ 30 people. They said, “We can’t afford HR, we can’t afford lawyers, we can’t afford for people to take us to tribunals. We just want to employ people, make a small profit and grow the business”. I cannot understand how this has become so complicated.

On Amendment 33, concerning the interpretation of “reasonable notice” when shifts are offered to agency workers, the aim appears to be to require agencies to make offers promptly once details are confirmed by the hirer and all the checks have been completed. While this may be an attempt to bring greater clarity, I question whether that proposal and that language fully address the practical realities of agency work. The intention may be sound, but there is a risk of replacing one form of ambiguity with another. That said, for agency workers some degree of predictability and transparency is important and long overdue.

Amendment 36 introduces the idea of joint liability between work-finding agencies and hirers when a shift is cancelled or curtailed at short notice. There is merit in exploring whether a shared responsibility could lead to fairer outcomes, particularly when neither party should be able to shift all risk on to the other. Equally, it is important to consider how such provision would work in practice and whether it risks disincentivising the use of agency labour altogether.

Amendment 37 proposes that compensation should be triggered only when a shift has been formally confirmed, rather than relying on the more subjective “reasonable belief” test. I appreciate the effort to bring objectivity to a murky area, but workers should not be left guessing whether an assurance from an agency amounts to a genuine commitment. We need to understand how this might interact with the fast-moving nature of some temporary staffing such as seasonal work or that connected with the weather. Ambiguity in the current framework serves no one, least of all the workers.

Finally, Amendment 38 provides that the agency would not be liable to pay compensation where the hirer fails to give appropriate cancellation notice. This is arguably a fairer allocation of risk, as agencies should not be penalised for the failure of others. However, it must be clear that such changes would not weaken the overall protections intended for the worker.

While these amendments raise important issues around the treatment of agency workers, I am not yet convinced that they strike the right balance in all aspects. There is a risk that in seeking to impose clearer structures, we introduce new complexities and unintended burdens. I think that this is what the Government are trying to say. Nevertheless, the underlying objectives—clarity, fairness and accountability—are ones that we should continue to pursue. Any changes to the framework must support clearer obligations and deliver fairer outcomes, for the workers and for the agencies and hirers. If these amendments highlight anything, it is the pressing need for the Government to offer clarity and consistency in this area.

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So, the Bill includes provisions in new paragraph 27 to enable agencies to recover costs from the hirer, but only where the arrangement between the agency and hirer was entered into no later than two months from Royal Assent and not modified since. The Government consider this the right approach to protect contractual freedom while ensuring timely payments for agency workers. It will protect agencies in existing arrangements from being liable for payments that they were not responsible for incurring. I hope those responses reassure the noble Lord and that he can withdraw his amendment.

[Lord Hunt of Wirral (Con)]

My Lords, this has been a helpful short debate. I join with the noble Lord, Lord Goddard of Stockport, in seeking clarity, fairness and consistency. The Minister has given us some answers to the questions we posed, but it is just another example of where it is so important to think through the issues, as they affect all those who are in any way covered by the Bill. We will need to return to this matter during the further passage of the Bill to ensure that my objective and that of the noble Lord, Lord Goddard, is fulfilled—namely, that the provisions offer a fair and workable solution for all the parties involved.

Lastly, in an unguarded moment, the Minister, in responding to the previous amendment, said that the draft implementation plan was “a work in progress” and that he was considering it with his colleagues. I make an offer on behalf of all in the Committee: we would be willing to help this work in progress by looking carefully through the first draft of the implementation plan, while accepting that it may not be the final draft. At least it would give us an idea of what is in the Government’s mind as to implementing rather complicated provisions in the Bill, which are currently shrouded in some degree of mystery as to what they will bring forward in secondary legislation.

I just repeat what we have said several times in the debate so far: when you amend primary legislation through secondary legislation, it is far better, in our view, to have those amendments in the Bill rather than being left to some further process—admittedly, consultation—that would then amend that primary legislation through secondary legislation. Like the noble Lord, Lord Goddard, I too have served on the other committees of this House, which find that Governments perhaps do not give secondary legislation the priority it needs but should never seek to amend primary legislation through secondary legislation. Many of our committees have said that time and again. If we could see the first draft of the implementation plan, we could assist the Minister and his colleagues to get this Bill right. I beg leave to withdraw the amendment.

Amendment 33 withdrawn.

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Moved by

[Lord Hunt of Wirral]

62: After Clause 8, insert the following new Clause—
“Impact assessment: sections 1 to 8(1) The Secretary of State must conduct a review of—(a) the impact of sections 1 to 8 on the operation of employment tribunals, and(b) the ability of employment tribunals to manage any increase in applications resulting from those sections.(2) The Secretary of State must lay the review made under subsection (1) and the Government’s response to the review before Parliament.”Member’s explanatory statement
This new clause would require the Secretary of State to conduct a review of the impact on the employment tribunals of the Bill’s provisions on zero hours workers.

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[Lord Hunt of Wirral (Con)]

My Lords, we now move to consider the impact assessments, or lack of them. Amendment 62, which I will speak to first, considers the impact on employment tribunals of the zero-hour contract provisions. Amendment 63 would require an impact assessment within six months, specifically for the hospitality sector, the retail sector and the health and social care sector. I greatly welcome the noble Baroness, Lady Fox of Buckley, who has kindly given her name to that amendment, along with my noble friend Lord Sharpe of Epsom.

Earlier this week we heard, and it was reported in the Financial Times, that the UK employment tribunal backlog had hit record levels. Some 49,800 cases were waiting to be heard by an employment tribunal at the end of the final quarter of last year, up from 39,000 in the same period of 2023. That is according to data from HM Courts & Tribunals Service. Earlier this afternoon, the Government refused to accept Amendment 21, which I spoke to and which would allow businesses to make a dismissal in the case of genuine business needs. By rejecting this amendment, as well as any suggestion from businesses throughout their consultation, I think that the Government are risking overloading the employment tribunal system even more than is the case today.

Moreover, it is worth noting that the Government have previously tabled so-called technical amendments that would have required employers to make work available to zero-hour workers. This alone highlights how impractical the current zero-hour contract provisions are when viewed through the lens of tribunal risk. It is deeply concerning, in particular, that the Regulatory Policy Committee has given a red rating to the Government’s impact assessment on day-one rights over unfair dismissal.

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[Lord Leong (Lab)]

My Lords, I thank the noble Lords, Lord Hunt, Lord Fox and Lord Londesborough, and the noble Baronesses, Lady Fox and Lady Stowell, for their contributions, and thank the noble Lord, Lord Sharpe of Epsom, for tabling Amendments 62 and 63. These amendments cover the impact of the Bill’s zero-hour contracts provisions on the employment tribunal system and on specific sectors.

Let me place on record that the Government recognise the vast contribution that the hospitality, retail and health and social care sectors make to the nation’s economy, and that they employ millions of people. I will give some examples. The hospitality sector currently employs 330,000 people on zero-hours contracts, which makes up 28.9% of the workforce. The retail and wholesale sector employs close to 90,000 people, equating to 7.8% of the workforce. The health and social care sector employs 190,000 people, contributing 16.5% of the workforce.

Zero-hours contracts offer flexibility for some workers, but evidence indicates that they have been exploited by certain UK companies, leading to job insecurity and limited work rights. This pro-business, pro-worker Bill aims to address these issues by effective enforcement and by closing the loopholes, to ensure fair treatment for all workers so that we can grow our economy.

Amendment 63 seeks to insert a new clause requiring the Secretary of State to publish an assessment of the impact of the zero-hours provisions in the Bill on specific sectors of the economy within six months of the passage of the Bill. As the Committee will know, the Government have already published a very comprehensive set of 27 impact assessments, spanning close to 1,000 pages. These are based on the best available evidence of the sectors likely to be affected by these measures. As mentioned by the noble Lords, Lord Hunt and Lord Fox, the RPC’s opinions refer to the evidence and analysis presented in the impact assessment and not to the policy itself. Our impact assessments provide initial analysis of the impacts that could follow. We will therefore be updating and refining them as we further develop the policy and continue consultation and engagement.

[Lord Hunt of Wirral (Con)]

Can the noble Lord respond to the red rating which the RPC has given the Government’s impact assessment? Are the Government continuing discussions with the Regulatory Policy Committee to try to reverse that red rating, to meet the necessary requirements that the Regulatory Policy Committee imposes on all Governments? When will we see an end to the red rating and an acceptance that the Government have learned from the experience and judgment of the RPC?

[Lord Leong (Lab)]

I thank the noble Lord. This impact assessment will continue. I will be mentioning later in my speech that there will be further impact assessments. Regarding his specific point about the RPC’s rating, I will write to him.

We recognise the importance of ensuring that the impacts of these policies on workers, businesses and the economy are considered, and that analysis is published outlining this. We already intend to publish further analysis, both in the form of an enactment impact assessment when the Bill secures Royal Assent and further assessments when we consult on proposed regulations, to meet our Better Regulation requirements. In addition, we are committed to consulting with businesses and workers ahead of setting out secondary legislation, as we have said on previous groups, including those from the sectors listed in the amendment.

Amendment 62 would insert a new clause to require the Secretary of State to undertake and publish a review of the impact on employment tribunals of the zero-hours provisions in the Bill. The detailed package of analysis, to which I referred a moment ago, also includes an illustrative impact assessment of the Bill’s measures on employment tribunal cases. We intend to refine this over time by working closely with the Ministry of Justice, His Majesty’s Courts & Tribunals Service, ACAS and wider stakeholders. We recognise the importance of assessing the impact of these policies on the enforcement system and have worked in partnership with these organisations throughout policy development.

We already intend to publish further analysis, both in the form of an enactment impact assessment when the Bill secures Royal Assent and further assessments when we consult on proposed regulations, as I mentioned earlier. In the meantime, the Government are taking various steps to increase capacity within the employment tribunal system. For example, ACAS currently provides information to employees and employers on employment law, and early conciliation for potential employment tribunal claims. It also offers post-claim conciliation. The Government have taken various steps to increase capacity, such as the deployment of legal caseworkers and recruitment of additional judges.

HMCTS continues to invest in improving tribunal productivity through the deployment of legal officers to actively manage cases, the development of modern case management systems and the use of remote hearing technology. We are committed to looking at what more we can do in this area, working with the Ministry of Justice and wider stakeholders such as ACAS, as I just mentioned. We are already helping many employers and workers to reach settlement before they need to go on to a further hearing.

Our work will also include looking at opportunities for the fair work agency to take on enforcement, where that would help both workers and businesses reach resolution more quickly without needing to go to an employment tribunal.

I refer to the point from the noble Baroness, Lady Fox, about gaps in the Bill. The Bill does not have any gaps. Some elements of the Bill await engagement or future engagement and consultation with stakeholders, so that we can ensure that the policies work for all involved.

I hope I have reassured your Lordships and that the noble Lord, Lord Hunt, will withdraw his amendment.

--- Later in debate ---

[Lord Leong (Lab)]

I take the noble Lord’s point. At the rate the Bill is going, we may reach recess before we come back again to discuss it further.

[Lord Hunt of Wirral (Con)]

My Lords, that was a very significant admission by the Minister, for which we thank him. We will need the recess to rethink quite a lot of the Bill.

I agree with the noble Baroness, Lady Fox of Buckley, that this is a gap-filled Bill. I know that the Minister is told in his brief to say there are no gaps, but there are gaps. Wherever you look in the Bill, there is further work to be done before the Government will say what they will do. It takes huge powers—Henry VIII powers—to amend primary legislation through statutory instruments. That is a hugely significant step, and we as a reasonably sensible Chamber cannot possibly allow the Government to get away with that.

You cannot get away with saying to Parliament, “We’re not going to give you the detail of what we’re going to do. Indeed, we’re not going to tell you what we’re going to do, because we’re going to consult and then we will do it by statutory instrument”. That is not the way to legislate. The contribution of the noble Baroness, Lady Fox of Buckley, has been very helpful. I also thank the noble Lord, Lord Londesborough, for reminding us about the creative industry—the gig industry.

As the noble Baroness reminded us, we have to have a relevant impact assessment so that Parliament can see what effect the Bill will have on a rapidly changing workforce. The workforce has changed dramatically over the last 15 to 20 years and the modern landscape has changed substantially.

[Lord Leong (Lab)]

I thank the noble Lord for giving way. I appreciate what he has said. We are all for parliamentary scrutiny of the Bill—we welcome it. We welcome every single amendment and clause being scrutinised. The Government believe that the delegated powers in the Bill are necessary. I am pleased, as the noble Lord will have noted, that the DPRRC found it

“heartening that in a Bill with so many … powers it has only found four on which to raise concerns”.

The Government will respond formally in due course to the DPRRC.

[Lord Hunt of Wirral (Con)]

I just happen to have the report of the DPRRC here, and it does raise serious concerns. One of the concerns it has constantly raised about all Governments is that they should not amend primary legislation by secondary legislation. They should be upfront about what they are going to do, and change.

It may well be that the Minister will take great comfort in the fact that there are only 18 black lines of criticism—18. I hope that he will take the advantage that has been given to him on all sides to take the Bill away and try to find a better solution.

We must not forget that the Bill I originally saw at Second Reading in the House of Commons has changed substantially: 160 amendments were tabled on Report in the Commons. They were not scrutinised line by line—they could not be, because they were produced at the last moment.

The Government have to recognise that, as my noble friend Lady Stowell said, it may well be that the Bill is going to disincentivise a whole range of employment situations, which is going to have a massive impact on the whole employment scene. It may well be that my noble friend is right that it is going to create more problems. I recognise that the noble Lord, Lord Fox, has already got a major concession concerning the utilisation of the recess, but we need to pause and say to the Government, can we now see the overall impact assessment and, in particular, have an undertaking that they will continue to scrutinise carefully the effect of all this legislation on the employment market before it is too late?

--- Later in debate ---

[Lord Hunt of Wirral (Con)]

I was looking to a longer holiday for us all to scrutinise the Bill. There is no need for the Minister to keep clarifying his comments. I just take them at face value, and it is an undertaking on his part to reflect on all the issues that have been raised, particularly the impact assessment. In the meantime, I beg leave to withdraw the amendment.

Amendment 62 withdrawn.

--- Later in debate ---

Moved by

[Lord Hunt of Wirral]

68: Clause 10, page 37, line 9, leave out paragraph (b) and insert—
“(b) in subsection (2), for “four” substitute “two”.”

[Lord Hunt of Wirral (Con)]

My Lords, I will speak to Amendments 68, 69, 70 and 71 standing in my name. I will speak to Amendment 68 first. It concerns the removal of the three-day waiting period for statutory sick pay. While we recognise the principle of supporting workers during periods of ill health, we also have to acknowledge the pressures that this places on employers, particularly small businesses which, unlike the state, bear the direct cost of statutory sick pay.

The original waiting period served as a guard-rail, ensuring that statutory sick pay was reserved for genuine and sustained periods of incapacity. Its removal would risk increasing claims for short-term absences, many of which might previously have gone unclaimed or been resolved informally.

The proposal in the Bill to abolish waiting days for statutory sick pay for all workers, including those on temporary contracts and working via employment agencies, introduces an additional cost burden for many small and medium-sized recruitment firms in particular, especially in a period of stagnant growth.

--- Later in debate ---

[Baroness Jones of Whitchurch (Lab)]

My Lords, I am pleased that we have moved on and that we are now debating the Bill’s important provisions to improve the provision of statutory sick pay for millions of people across the country. I therefore thank the noble Lords, Lord Sharpe and Lord Hunt, for tabling Amendments 68, 69, 70 and 71 on this topic and speaking to them. These amendments would significantly change the statutory sick pay measures in the Bill.

The pandemic exposed just how precarious work and life are for those on low incomes, with many forced to choose between their health and financial hardship. Strengthening statutory sick pay is part of the Government’s manifesto commitment to implement our plan to make work pay, ensuring that the statutory net of sick pay is available to those who need it most. These changes are important. Estimates indicate that up to 33% of influenza-like illnesses are acquired in the workplace. One sick employee coming into work can lead to 12% of the workforce becoming sick, according to WPI Economics’ modelling.

The changes to remove the waiting period and lower earnings limit from the SSP system will therefore benefit employers by reducing presenteeism, which in turn can lead to overall productivity increases and can contribute to a positive work culture that better helps recruit and retain staff. This can help to reduce the overall rate and cost of sickness absence to businesses, and also contribute to reducing the flow of employees into economic inactivity.

I will turn first to Amendments 68 and 70. Removing the waiting period is essential to ensure that all eligible employees can take the time off work they need to recover from being sick, regardless of whether they are an agency worker. Removing the waiting period will also better enable phased returns to work, which evidence shows can be an effective tool in supporting people with long-term health conditions to return to and stay in work. This change should help to reduce the overall rate and cost of sickness absence to businesses, contributing to reducing the flow of employees into economic inactivity.

I regret that the noble Lord’s amendment would make this more challenging, as it would mean that employees would have to take two consecutive days off to be eligible for statutory sick pay. I do, however, understand the noble Lord’s concerns about the impact of the waiting period removal on businesses, but if employers have the right policies and practices in place—and most good employers do—the risks of inappropriate absenteeism can, of course, be mitigated. Crucially, the additional cost to business of the SSP reforms is around a relatively modest £15 per employee. We have been lobbied from both directions on these provisions because, for example, many on our own Benches would say that the rates we are proposing here should be much higher. I am sure they will make their concerns heard at some point during the passage of the Bill. It is not a great deal of money—as I say, it is £15 per employee—and it is certainly aimed at the lower rate that could be available.

On Amendment 69 regarding agency workers, one of the fundamental principles of the Bill is to ensure that people who work through employment agencies and employment businesses have comparable rights and protections to their counterparts who are directly employed. Amendments that limit the entitlement of agency workers would undermine this objective and have no reasonable justification. The noble Lord, Lord Hunt, said that employment agencies have more of an arm’s-length arrangement with their agency workers, but I would say the opposite: in fact, employment agencies are in a powerful relationship over their agency workers, meaning that those workers are less likely to abuse such a scheme.

Amendment 71 seeks to limit the maximum entitlement of SSP for employees with multiple employers so that they would receive no more statutory sick pay than they would be entitled to if they worked for only one employer. However, this would be administratively very complicated to deliver for businesses, particularly SMEs, and carries a high risk of SSP being miscalculated and employees being underpaid. It would particularly harm the very lowest-paid people who are working a limited number of hours. I also question the necessity of such an amendment. As it stands, employees with more than one job can already receive SSP from their employers if they earn above the lower earnings limit. The measures in the Bill will not change that, and I regret that this amendment would impact only the lowest-paid employees.

That is all I have to say on this issue at this stage, and I therefore ask the noble Lord to withdraw his amendment on the basis of the assurance I have given.

[Lord Hunt of Wirral (Con)]

My Lords, I recognise that the Minister says that she understands the concern that has been expressed. We are aware too that many agencies have raised with the Government the serious impact on small businesses and the risk of increased absenteeism. I believe their concerns are valid and I hope the Minister will continue to keep an open door for those agencies to perhaps respond in more detail directly to the Minister.

--- Later in debate ---

[Baroness O’Grady of Upper Holloway (Lab)]

Before the noble Lord sits down, it would be very helpful if he could confirm and clarify that, in expressing a concern that removing the waiting days would lead to more and sporadic absenteeism, it is not being implied that workers are swinging the lead. If it was being implied, where is the evidence?

[Lord Hunt of Wirral (Con)]

Of course it is not being implied. It is outrageous that the noble Baroness should think so and voice so in this debate, which has seen a very calm and careful consideration by the Minister, who sets a good example for us all. I hope the noble Baroness will follow it. I beg leave to withdraw.

Amendment 68 withdrawn.

Employment Rights Bill

Lord Hunt of Wirral Excerpts

Committee stage
Tuesday 13th May 2025 Lords Chamber

Moved by

[Lord Hunt of Wirral]

74A: After Clause 11, insert the following new Clause—
“Impact assessment: Statutory Sick Pay provision on absenteeismWithin 12 months of the day on which this Act is passed, the Secretary of State must publish an assessment of the impact of the provisions in this Act relating to Statutory Sick Pay on levels of absenteeism.”Member's explanatory statement
This new clause requires the Secretary of State to publish an assessment of how the Statutory Sick Pay provisions in the Act impact absenteeism, within 12 months of the Act being passed.

[Lord Hunt of Wirral (Con)]

My Lords, after what has been a fascinating, wide-ranging and important debate on statutory sick pay, I would like to focus on the impact that these changes are going to have in particular on absenteeism, on short-notice shifts and on enhanced sick pay schemes. So I shall speak to Amendments 74A, 74B and 74C. We will continue to make the point that this Bill brings with it a raft of unintended consequences.

The importance of Amendment 74A cannot be overstated. Absenteeism is a critical issue for many businesses, especially those in hospitality, retail and other service-based industries, where staff shortages can lead to disruption, cancellations and even closures. With the removal of waiting days for SSP and the expansion of eligibility, it is essential that all of us should understand fully how these changes will affect absenteeism patterns across various sectors.

One of the sectors most concerned with the potential rise in absenteeism that these changes will cause is, of course, hospitality. Many businesses in this sector rely on part-time, hourly or zero-hour contracts, often employing younger workers, students or those with fewer financial responsibilities.

As we know, a significant portion of the workforce in hospitality earns below the lower earnings threshold for statutory sick pay, and may be employed for only limited hours. These workers are typically less dependent on their income, often still living at home or with fewer financial obligations. This brings us to a major concern. If these workers know that they will still receive statutory sick pay regardless of their financial needs, there may be little incentive for them to attend work when they feel under the weather, or even when they would simply prefer a day off. The concern is that the reforms could result in workers taking sick leave when it may not be strictly necessary, as the financial implications of their doing so would be mitigated by the statutory sick pay payment.

For example, if a student worker or part-time employee knows that they will still receive statutory sick pay, even if they do not meet the earnings threshold, they may not feel the same level of obligation to attend work. This is particularly true in a sector such as hospitality, where work provides either temporary or supplementary income. As such, the absence of financial pressure could lead to increased absenteeism in the short term, which could, in turn, lead to operational challenges for hospitality businesses, especially those that already operate with small teams, a high turnover of staff, or both.

As I mentioned, we believe it is essential that the Government thoroughly evaluate how these statutory sick pay provisions would affect absenteeism, particularly in sectors such as hospitality, where the risks of absenteeism are most pronounced. The impact assessment called for in Amendment 74A would enable us better to understand the extent to which these reforms would result in higher absenteeism rates and whether there are any other unintended and undesirable consequences, such as workforce disengagement, or a lack of motivation to work, in sectors where employees may not be so financially reliant on their income.

It is vital to understand, first, how absenteeism levels might change, especially in sectors with a younger, less financially reliant workforce; secondly, the operational challenges businesses would face due to potential increases in absenteeism; and, thirdly, the wider economic effects of these changes, including potential impacts on service quality, customer satisfaction and employee morale.

I turn to Amendment 74B. The proposal to remove the waiting period for statutory sick pay and the lower earnings limit represents a substantial shift in how sick pay obligations are structured. It carries serious financial implications, particularly for low-margin sectors, such as retail and hospitality, and for small and medium-sized enterprises more broadly. This amendment seeks a modest but necessary safeguard. It asks the Government to publish, within six months, a report on the impact of these statutory sick pay reforms on employers’ ability to offer enhanced sick pay and occupational health and well-being services.

As of 2024, 28% of UK employers offer occupational health services, while 27% provide sick pay that goes beyond statutory minimums. While we certainly want to see those numbers improve, we must surely understand why provision remains relatively low. A survey conducted last year found that 43% of business leaders cite financial constraints as the primary barrier to offering enhanced sick pay. Another 31% highlighted legal complexity; 28% cited administrative burden; and 31% cited staffing challenges as further obstacles. Rather than addressing those challenges, surely the Government have to recognise that the Bill threatens to amplify them.

--- Later in debate ---

[Lord Fox (LD)]

It would be very useful if she could share it with the other Front Benches as well.

[Lord Hunt of Wirral (Con)]

I am very grateful to the Minister. We have had a very important debate. I am particularly grateful to the noble Baroness, Lady Fox of Buckley, because we have not really spent enough time worrying about the people who are just unable to cope. Working conditions have changed so much. Stress-related sick leave is a huge issue, as is what the noble Baroness referred to as “losing the habit of work”. These are issues that we have to think about very carefully.

There is an important and complex issue of so-called presenteeism, which deserves greater attention in our discussions about workplace health and productivity. I came across some research—perhaps the noble Baroness had this in mind—carried out by Robertson Cooper: its 2023 data, drawn from over 3,000 UK respondents, revealed that almost two-thirds, 60%, of employees reported working while they were unwell, so-called presenteeism, in the last three months. That is an important issue, which has to be taken into account in any impact assessment.

The distinction is essential because not all forms of working while unwell are inherently harmful. Some, such as pragmatic or therapeutic presence, can be beneficial for both the employer and the employee. The challenge lies in identifying when presenteeism becomes detrimental and ensuring that workplace policy, including statutory sick pay reform, supports businesses in managing that balance effectively.

I am also grateful to the noble Lord, Lord Vaux of Harrowden, for reminding us of the finding of the Regulatory Policy Committee. We just need to be aware of the severe criticism that was meted out about a Bill that is making such profound changes while in the gloom of uncertainty, because no one can be actually sure what effect these changes are going to have.

Employment Rights Bill

Lord Hunt of Wirral Excerpts

Committee stage
Tuesday 13th May 2025 Lords Chamber

That is why we are proud of Amendment 135, and I am delighted with the support we have had across the Committee. This is the Bill that can deliver paid carer’s leave; this is the Bill that should deliver paid carer’s leave. The Committee has made it clear what it thinks the Government should do in response to Amendment 135.

[Lord Hunt of Wirral (Con)]

I agree with the noble Lord, Lord Fox, whose fox has not been shot.

This has been such an interesting, important, fascinating and deeply moving debate. We owe a debt of gratitude to the noble Lord, Lord Palmer of Childs Hill, for very positively introducing the fact that unpaid carers are the backbone of the care system, and for bringing us up to date with the reality of modern families. I think the Committee has spoken with one voice as we await the reply from the Government Front Bench. Have we not united in saying what we want the Government to do? It will be very interesting to hear the response. I hope they will use every moment between now and Report to be more specific about how they wish to respond to the issues that have been thrown up in this debate.

Like the noble Lord, Lord Palmer, I acknowledge the importance of kinship carers—the grandparents, aunts, uncles, siblings and other close family members who step forward when children need a stable and loving environment. These individuals often take on significant responsibilities with little preparation or support, and they always do so with compassion and commitment. The contribution of kinship carers cannot be overstated. As the noble Lord, Lord Watson of Invergowrie, and the right reverend Prelate the Bishop of Newcastle reminded us, they help prevent children entering the care system. They keep families together, and often do so at great personal and financial cost.

I have to acknowledge the contribution of my noble friend Lord Young of Cookham, who had some wonderful specific quotes to share with the Committee. There is an important strategic alliance here, particularly with the noble Baronesses, Lady Pitkeathley and Lady Lister of Burtersett, and it will be important to respond positively to the points that they have made.

I believe there is a genuine case for us to explore how we might better support those who take on these caring responsibilities in such difficult circumstances. While I appreciate that statutory leave may not be straightforward to implement, especially in the current economic climate, there is room, as the noble Lord, Lord Fox, suggested, for a wider conversation about what more might be done. There should therefore be further consultation on this matter—with kinship carers themselves, with businesses and with the wider public—to understand the practicalities and to gather the necessary evidence. If we can find a solution that is proportionate, workable and rooted in the realities faced by both carers and employers then that will deserve our serious consideration. As the noble Baroness, Lady Smith of Llanfaes, has said, there is room here for a modest move forward that would make a significant contribution.

We have to acknowledge the moving speech of the noble Lord, Lord Brennan of Canton, about bereavement leave. He spoke movingly of his Commons colleague Sarah Owen, MP for Luton North, who has blazed a trail of understanding in some areas that previously have not been properly understood, and we need to respond positively to that.

The noble Baroness, Lady Grey-Thompson, talked about serious childhood illness, pay and leave, supported by the noble Lord, Lord Hogan-Howe. That that is another area where we need to explore how we can better tackle these challenges. In all these areas, I am confident that, through continued dialogue, we can work towards a sustainable strategy.

[Lord in Waiting/Government Whip (Lord Katz) (Lab)]

My Lords, this has been another wide-ranging debate and I am grateful for the contributions of all noble Lords. As the noble Lord, Lord Hunt, my opposite number, just said, it has been a moving and profound debate that has demonstrated the complexities of the issues in front of us. There is unanimity across the Committee, I am sure, that we should do as much as we can to support carers. We have to ask ourselves how best we do that. We have picked up the baton from the last Government, who passed the Carer’s Leave Act, and we must move forward on that—but I am getting ahead of myself.

I join the noble Lord, Lord Hunt, in paying tribute to the noble Lord, Lord Palmer of Childs Hill, and the noble Baroness, Lady Grey-Thompson, for putting the issue of kinship care in front of us, tabling Amendments 77, 78, 79, 134, 135 and 144. I also thank my noble friend Lord Brennan of Canton for tabling Amendment 81. I will do my best to get through these amendments at a decent pace.

I will begin with kinship care, speaking to Amendments 78 and 79, tabled by the noble Lord, Lord Palmer. I join others in emphasising how greatly I and the Government appreciate kinship carers, who generously step into the breach and offer loving homes for children who cannot live with their parents. I am sure that the whole House shares these sentiments.

I reassure noble Lords that the Government are committed to ensuring that all employed parents and carers receive the support they need to manage both their work and their family lives. As we have heard, Amendment 78 aims to establish a new “kinship care leave” entitlement for employed kinship carers. Amendment 79 then seeks to creates a legal definition of “kinship care” to be used to establish eligibility for kinship care leave.

The right reverend Prelate the Bishop of Newcastle, my noble friend Lord Watson of Invergowrie and, indeed, the noble Lord, Lord Palmer, himself, rightly talked about the amazing work done by kinship carers across the country, supporting children in times of greatest stress and need, in their own households, and in so doing relieving local authorities and the wider care system.

The Government recognise that the current support for working families needs improvement. We have already begun work to improve the system for kinship carers. We are defining kinship care through other legislation that is currently before this House, and later this year we will begin trialling a kinship allowance in several local authorities.

We are pleased to say that, for the first time, through the Government’s Children’s Wellbeing and Schools Bill, we will create a legal definition of kinship care for the purposes of specific duties within that Bill: the requirement to provide information about services to kinship families, and the duty to promote the educational achievement of children in kinship care. This will help to ensure that all local authorities interpret and apply the definition uniformly in relation to the new duty to publish information required, reducing ambiguity and potential disparities in information provided about support by different local authorities. This will, we hope, make life much easier at the sharp end of providing kinship care. It is a vital part of our commitment to keeping families together and supporting children to achieve and thrive.

I am also very pleased to say that the Government have recently announced a £40 million package to trial a new kinship allowance. This is the single biggest investment made by any Government in kinship care to date; indeed, it is the first of its kind. This financial commitment could transform the lives of vulnerable children who can no longer live at home. It would enable children to be raised within their extended families and communities. As we heard from the noble Lord, Lord Palmer, and others, it would minimise disruption to their formative years, allowing them to focus on schooling and building friendships—in short, having a normal life, as we want for all our children.

In addition, qualifying employed kinship carers may already benefit from various workplace rights aimed at supporting employees in managing work alongside caring responsibilities. These include a day one right to time off for dependants, which grants a reasonable amount of unpaid leave to deal with unexpected emergencies involving a child or dependant; the right to request flexible working; and unpaid parental leave, which, through this Bill, we are making a day one right.

Employees may not automatically have parental responsibility as a result of being a kinship carer, but they can acquire parental responsibility through different legal methods such as a special guardianship order. The Government have also committed to a review of the parental leave system to ensure that it best supports all working families. This review will be conducted separately from the Employment Rights Bill, and work is already under way on planning for its delivery.

Amendment 77 would provide foster carers with one week of leave every 12 months. As we have heard, foster carers play a life-changing role in the lives of children who need a safe and supportive environment. At times when young people are facing significant challenges, foster parents offer not only care and security but emotional support and consistency. I pay tribute to all those who step forward to provide the essential service of foster-caring—not least, as we have heard, the noble Lord, Lord Young of Cookham, who has now changed his place but is very much with us in the Chair.

It is important to highlight that a range of workplace rights already exists to help employees who take on the responsibilities of fostering. From their first day on the job, employees have the legal right to take unpaid time off in emergency situations involving their dependents. This enables them to respond swiftly to sudden issues, such as arranging care for a foster child. If a foster carer is looking after a child with a long-term illness or disability, they are entitled to carer’s leave. This provides them with up to a week of unpaid leave in a 12-month period, to manage healthcare needs or attend appointments. Those fostering with the intention of adopting may be eligible for paid adoption leave, provided they meet the necessary criteria. In addition, all employees are entitled to submit a request for flexible working arrangements from day one of their employment. Given that these existing provisions go a long way to help foster carers to balance work and their foster care responsibilities, it does not seem right to add a new entitlement without a proper assessment of the need for it and the impact it might have.

Employment Rights Bill

Lord Hunt of Wirral Excerpts

Committee stage
Monday 19th May 2025 Lords Chamber

[Baroness Kramer (LD)]

My Lords, I am a signatory to this excellent amendment, but I am also speaking as a winder from these Benches. I shall speak very briefly, because I will touch on many of the issues in a later group, but this is so important. I am so glad that the noble Baroness, Lady Morrissey, brought forward an amendment that focuses on the issue of investigation and action.

The noble Baroness has made the case powerfully, but for many people, it is such a shock to realise that it is the victim of sexual harassment—usually a woman, sometimes a man—who finds themselves, in effect, on trial. That is how the investigative process, when it happens, generally progresses. We all know that that is wrong and has to change.

If you talk to people who have been victims and ask them what they want most as a response to having spoken out, despite what they have gone through, the answer, again and again, is twofold. First, they never want this to happen to anybody else; secondly, they want investigation and action. The systems we have in place never focus on that issue and drive it as the primary response when somebody speaks out with a serious complaint of this nature; we will be talking later about complaints of another nature. I hope very much that people will become engaged with this issue, which has been so well represented here today.

[Lord Hunt of Wirral (Con)]

My Lords, I commend my noble friend Lady Morrissey on moving this important amendment. She speaks from her own personal experience with wisdom and understanding, in particular on the whole issue of investigation and action. I also agree with the noble Baroness, Lady Kramer: the victim can so often find themselves on trial, and that is unacceptable.

So I have some sympathy with this amendment, in that it seeks a more proportionate approach to the matter than the Bill currently contains. We all agree that harassment, particularly when it is persistent—and, even worse, when it comes from a senior colleague—is a stain on society. Not only does it poison the workplace; it can ruin lives.

The amendment emphasises the need for employers to act reasonably, particularly in cases involving serious allegations such as sexual assault or harassment by senior management, and to protect the well-being of the employee involved.

Of course, many businesses already follow best practice, and we believe that proper measures to address the issue are critical in building safer and more respectful workplaces. Clause 20 as drafted also raises concerns about free expression, and it is our view that the amendment would be better placed elsewhere in the Bill, where it can be more thoroughly examined and discussed in its own context, without the issue of freedom of expression being engaged.

I want to emphasise from these Benches that we are committed to tackling sexual harassment in a meaningful way, but we also believe in ensuring that the right to free expression is carefully protected. We will listen very carefully to the Minister’s response to these concerns, and we will continue to advocate for a balanced approach that protects the dignity and safety of individuals while preserving fundamental rights.

Employment Rights Bill

Lord Hunt of Wirral Excerpts

Committee stage
Monday 19th May 2025 Lords Chamber

Moved by

[Lord Hunt of Wirral (Con)]

97: After Clause 22, insert the following new Clause—
“Employer duties on harassment: impact assessment(1) The Secretary of State must carry out an assessment of the likely impact of sections 19 to 22 of this Act on employers.(2) The assessment must report on the extent to which the prevalence of third-party harassment makes the case for measures in sections 19 to 22 and—(a) include an assessment of the impact of sections 19 to 22 on free speech;(b) include an assessment of the likely costs to employers of sections 19 to 22;(c) include—(i) an assessment of which occupations might be at particular risk of third-party harassment through no fault of the employer, and(ii) proposals for mitigations that can be put in place for employers employing people in such occupations.(3) The Secretary of State must lay a report setting out the findings of the assessment before Parliament.”Member's explanatory statement
This new clause requires the Secretary of State to assess the impact of the provisions of Clauses 19 to 22.

[Lord Hunt of Wirral (Con)]

My Lords, Amendment 97 stands in my name and that of my noble friend Lord Sharpe of Epsom. I am delighted that my noble friend Lord Jackson of Peterborough and the noble Baroness, Lady Fox of Buckley, have also signed this amendment.

As we look back over the debates we have had on Clauses 19, 20, 21 and 22, we quickly reach the conclusion—as the Minister said in winding up the last debate—that there is a great deal of misunderstanding about the effect of these clauses. That is because the Government’s impact assessment is simply not fit for purpose. This proposed new clause would require the Secretary of State to assess the impact of the provisions of Clauses 19 to 22.

In many ways, I am only repeating what I have said on several other occasions throughout the passage of the Bill: there has not been enough homework done on the impact of the various clauses. That is particularly true in relation to the clauses concerning the requirement for employers not to permit the harassment of their employees by third parties.

I say to the noble Lord, Lord Fox, that my noble friends Lord Young of Acton and Lady Noakes have not exhibited synthetic rage but genuine concern. They have raised a number of important and serious concerns about the clauses as drafted. Yet the Minister, although I was hoping she might, failed to commit to undertaking a comprehensive and robust impact assessment. That is just not good enough.

In fact, on all three of the standard criteria used to evaluate regulatory proposals—rationale for intervention, identification of options and justification for the preferred way forward—the Regulatory Policy Committee has given a red rating to the Government. That should be deeply concerning to all of us in this Committee.

The Government are, of course, absolutely right that harassment in the workplace is unacceptable. That is a point on which there is strong consensus right across the Committee, and rightly so. Many noble Lords have spoken powerfully and persuasively on this matter during our debates, including many, very eloquently, on the Government Benches. Given that, it is all the more baffling that the Government should have taken such a lacklustre and superficial approach to the impact assessment for these specific clauses.

The assessment surely needs to provide a much more rigorous analysis of the risks. There is, for example, no mention at all of the very risks and impacts that led to the Worker Protection (Amendment of Equality Act 2010) Act 2023 being amended during its passage through Parliament. That legislation originally included provisions around third-party harassment, which were dropped after those serious concerns were raised, particularly in relation to freedom of speech and the cost burdens on employers. Surely no justification is offered here for ignoring those previous conclusions.

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[Lord Leong (Lab)]

My Lords, this has been a very thought-provoking debate, and I thank all noble Lords who have contributed. I thank the noble Lord, Lord Sharpe of Epsom, for tabling Amendment 97. The noble Lord is seeking to add a new clause that would require the Secretary of State to assess the impact on free speech and on employers of Clauses 19 to 22 when the Bill becomes an Act. We have already produced and published an extensive set of impact assessments. Indeed, we have produced and published no fewer than four impact assessments covering provisions in the scope of the noble Lord’s amendment.

[Lord Hunt of Wirral (Con)]

In order to get his speech off to a really good start, can the Minister include his defence of the red rating given to those impact assessments by the Regulatory Policy Committee, a completely independent assessment?

[Lord Leong (Lab)]

I thank the noble Lord for reminding me of this; we covered it last week. The RPC did not question the policy of the Bill. It just questioned the evidence—and I will go further on this Bill.

These assessments are based on the best available evidence of the potential impact on businesses, workers and the wider economy. We plan to further define this analysis in the future, working with a range of stakeholders including businesses, trade unions, academics, think tanks and the Regulatory Policy Committee to do so.

The Government are steadfast in their commitment to tackle all forms of harassment in the workplace. We know that harassment at work can have a huge impact on affected individuals, as well as broader economic impacts. The burden of holding perpetrators to account and of driving change is too great to be shouldered by employees alone. These measures send a clear signal to all employers that they must take steps to protect their employees from harassment, including from third parties, to encourage a cultural change.

We know that the vast majority of employers agree that harassment is unacceptable and are working to ensure that their employees are treated with respect. We will work in partnership with them towards this shared goal and will support them with these changes. We will publish an enactment impact assessment once the Bill receives Royal Assent, in line with the Better Regulation Framework. This will account for amendments made to primary legislation during the Bill’s passage through Parliament that would significantly change the impact of the policy on business. This impact assessment will be published alongside the enacted legislation. Additionally, we will publish further analysis, alongside carrying out further consultation with stake-holders, ahead of any secondary legislation, to meet our Better Regulation requirements.

According to our best estimates, across all our harassment measures the monetary cost to businesses will not be significant. Other than the initial one-off familiarisation cost, repeatable costs to businesses are very low. All three measures will also bring benefits to businesses in avoiding the harassment of staff.

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[Lord Hunt of Wirral (Con)]

We are all very grateful to the Minister for sharing that personal experience. I believe he can be comforted by knowing that there is a shared desire right across this House to ensure that all workplaces are safe, respectful and free from harassment. I hope that he would also expect, in the light of his personal experience—and I think several of us could probably share our personal experiences—that we must, however, act as a Parliament should act, which is that well- intentioned legislation has to be workable, proportionate and underpinned by clear evidence.

The noble Lord, Lord Hendy, made the point about the benefits, but any impact assessment will not be restricted to looking at the costs but will also look at the benefits. Any proper impact assessment should give the full picture, so that when the legislation is presented to Parliament, we can adjudicate on it. In many ways, the consultation he instanced is coming the wrong way round. The consultation should accompany the intention to legislate. Then, once the consultation is complete, we are subject to parliamentary scrutiny. Consultation is no excuse for lacking accountability to Parliament. That is, I think, where the issue divides us.

[Lord Leong (Lab)]

I take on board every contribution made by every noble Lord. This is a very important aspect, and we need to get it right. Rather than me reading a couple of sentences provided by my officials in the Box, I make an offer to all noble Lords that I will organise a meeting so that we can sit down and go through this in more detail.

[Lord Hunt of Wirral]

There is no need for me to say any more. Thank you very much. I accept that offer, and I beg leave to withdraw my amendment.

Amendment 97 withdrawn.

Employment Rights Bill

Lord Hunt of Wirral Excerpts

Committee stage
Wednesday 21st May 2025 Lords Chamber

[Baroness Watkins of Tavistock (CB)]

My Lords, I support this amendment and declare my interest as the chair of a small housing association, Look Ahead, where we employ a lot of care workers and are encouraging apprenticeships to keep people in care work and to develop proper careers. We have not yet got the Casey review on care workers, but we know that the Government intend to reduce visas for overseas workers in this area. However, when you go into care work, you always find a small proportion of people who, when they realise some of the challenges of giving intimate physical care, feel unable to go on with that particular work. That is perfectly appropriate for both the apprentice themselves and the people they are supporting. I urge us to try to reach an agreement on this that is more flexible, so that people can have the opportunity of an apprenticeship in care, while recognising that, sometimes, a different kind of work is more appropriate.

[Lord Hunt of Wirral (Con)]

My Lords, this has been such a valuable debate, for a number of reasons. We are grateful to the noble Lords, Lord Aberdare and Lord Knight of Weymouth, and the noble Baronesses, Lady Wolf of Dulwich and Lady Garden of Frognal. In many ways, it gives us an opportunity just to see where we are going, and to identify the fact that, for many of us, apprenticeships mean something deep and profound.

I am delighted to see the noble Lord, Lord Monks, in his place. He probably will not remember but, 32 years ago, he came to see me when I had responsibility for this area of policy. Accompanying him was the noble Lord, Lord Jordan, and they said to me, as Secretary of State for Employment, that apprenticeships needed to be brought into the modern age and that there had to be something deeper, wider and more productive for the individual than the idea of standing by a machine for five years and then qualifying. They were talking particularly of young apprentices. I was persuaded, and, slowly but surely, modern apprenticeships have evolved.

I do not think that the noble Lord, Lord Monks, remembers this, but that was followed by a cartoon in the Guardian, which my children still show me—I should not talk like this on my birthday. The cartoon demonstrates me getting into a large four-poster bed with the noble Lord, Lord Monks, who was in the form of a large cart-horse—the cart-horse had the face of John Monks. This gives me an opportunity to apologise to the noble Lord. I suppose that the Guardian was saying that it looked as though the Conservative Government were listening to the TUC. We did, and modern apprenticeships have taken off ever since.

The levy though, as the noble Baroness, Lady Garden of Frognal, reminded us, has shifted the emphasis and the whole intention, which was to encourage younger people to get more involved. In a way, we need to identify that—and I hope that the Minister will recognise that apprenticeships are the lifeblood of the new economy, in particular, provided that they receive that special status. It was very helpful that my noble friend Lady Coffey reminded us about age, and that perhaps 25 is a better age in this regard. My noble friend Lady Stowell of Beeston also put it much more into context, and the noble Baroness, Lady Watkins of Tavistock, gave an additional dimension. It has been a valuable debate.

I remind the Minister that we are talking about specific instances where there has to be an apprenticeship contract containing often wide-ranging provisions but giving security and opportunity. So it is a balanced and measured amendment that acknowledges the critical reality that apprenticeships are not just simply jobs—they are a structured training programme, often the very first experience that a young person has of the workplace. For many of these individuals, particularly those youngsters, an apprenticeship is a gateway not just to employment but to the habits, responsibilities and expectations of adult working life.

We are already in a time, as many of my noble friends pointed out, when young people are struggling to access secure employment. The noble Lord, Lord Londesborough, reminded us about the serious problems affecting NEETs, which have cropped up several times in this debate already—and also the fact that, in other European countries, apprentices have a special legal status. In many ways, that is recognised in this amendment, because it talks about a contract. We can identify that we are talking about a very special situation, and I hope that the Minister sees that.

I will just add that, without legal clarity around probationary periods, particularly in the case of apprenticeships, many employers will be left uncertain—and uncertainty breeds hesitation. It becomes less likely that they will take on the risk of hiring an inexperienced young person, especially under a regime of day one unfair dismissal rights, with no allowance for the formative nature of apprenticeships. I shall be very interested to hear the Minister’s response on that matter, on how the Government seek to balance the protection of apprentices with the practical realities of probationary periods. I support the amendment.

[Lord Leong (Lab)]

My Lords, first, I take this opportunity to wish the noble Lord, Lord Hunt of Wirral, a very happy birthday. It is a fine way to spend a birthday this evening.

I thank all noble Lords who have contributed to this debate, notably the noble Lord, Lord Aberdare, for speaking on behalf of the noble Baroness, Lady Wolf of Dulwich. I thank the noble Baroness for her amendment and for all the work that she has done in primary and secondary education—especially her book, The XX Factor, which should be read widely by every person involved in education policies.

This group relates to apprenticeships; a later group delves deeper into unfair dismissal and probation. The Government recognise the significant value of vocational learning, and on-the-job training will continue to be fundamental to building the skills that the economy needs to grow. We recognise that employers value building knowledge and skills through apprenticeships, and this Government are committed to apprenticeships.

The Government are providing day one protections against unfair dismissal to all employees, including apprentices. Maintaining a qualifying period for apprentices will leave them open to being fired without any recourse to legal challenge on the grounds of unfair dismissal during their apprenticeship. This amendment would not create a probation period, as the noble Lord, Lord Londesborough, said; it would deny young people their day one rights. The Government’s preference is for statutory probation to be a period of nine months; in some instances, when an apprentice completes their apprenticeship, an employer may not have a permanent job for them. Most apprenticeship contracts are around two years in duration; in this case, the apprenticeship contact will expire and the normal tests for unfair dismissal will apply.

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Moved by

[Lord Hunt of Wirral]

113ZA: Clause 26, page 45, line 24, after “sought” insert “without good reason”
Member’s explanatory statement
This amendment and another in the name of Lord Sharpe limit the application of the clause to cases where the employer sought, without good reason, to vary the employee’s contract of employment in relation to their pay or benefits.

[Lord Hunt of Wirral (Con)]

My Lords, as we move to consider Clause 26, I believe Amendments 113ZA and 113B bring essential clarity, balance and proportionality to the Bill’s treatment of contract variation.

In last week’s debate, we discussed how recent changes to statutory sick pay might prompt employers to scale back or modify enhanced sick pay schemes. Such adjustments would require changes to contracts, and under the Bill’s current wording could be caught by these provisions. This raises the question: is it really the Government’s intention to classify necessary contractual changes prompted by those reforms to statutory sick pay as grounds for unfair dismissal?

The Government’s plan to make work pay rightly criticises cases where these practices have been used to enforce lower pay or to reduce terms and conditions. That is a legitimate concern. However, as currently drafted, Clause 26 goes far beyond this intention. It would cover any contractual change, no matter how minor, technical or reasonable, even those entirely unrelated to pay or benefits. This creates serious practical problems. Employers would be exposed to legal claims of unfair dismissal, even when seeking to modernise contractual terms; for example, aligning shift patterns with contemporary trading hours or updating disciplinary procedures drafted decades ago. In effect, this clause could fossilise employment contracts, preventing businesses from adapting to economic, operational or technological change, unless they meet a narrow and restrictive test.

I acknowledge that the phrase “without good reason” in Amendment 113ZA may introduce some degree of ambiguity. However, any dispute from it would fall to the employment tribunals to determine. While we have previously argued—and I maintain—that the Government have no credible plan to resolve the serious backlog and underfunding of the employment tribunal system, the fact remains that these tribunals will be the ones to judge whether a variation was sought with good reason.

In the current economic climate, businesses may need to make reasonable changes to pay structures to remain viable. Without these amendments, I believe employers may be deterred from offering pay increases or promotions, unless employees accept other contractual changes, potentially creating a two-tier workforce. In more extreme cases, employers might choose to make roles redundant altogether, rather than risk costly litigation over sensible and necessary variations.

I will speak also to Amendment 114 in this group. The clause’s reliance on language such as

“the employer’s ability to carry on the business as a going concern”

and “financial difficulties” implies that only in the most extreme circumstances—insolvency or imminent closure—can dismissal and re-engagement be considered. That is surely far too narrow a test. Businesses are not static and responsible employers must often adapt to evolving market conditions, consumer behaviour and, of course, technological innovation. These changes are not about survival, they are surely about growth, competitiveness and investment, as we expressed in earlier debates.

Medium and large businesses may face particular challenges here. They may need to apply changes to specific segments of the workforce, not the entire business, yet the Bill appears to treat the business as a whole, creating further uncertainty and limiting proportionate action.

It would be very helpful if the Minister could explain how the Government define business. The revised wording in this amendment, “could reasonably be expected”, better reflects how responsible employers assess risk and manage their operations. It would give them the legal certainty to act proactively to avoid crisis, rather than reactively once a crisis is already upon them. The existing wording could penalise businesses for prudent foresight, discouraging early intervention and increasing the likelihood of greater harm to jobs and continuity of business.

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I hope I have managed to convince some noble Lords, and I respectfully urge the noble Lord to withdraw Amendment 113ZA.

[Lord Hunt of Wirral (Con)]

My Lords, I have a feeling that although the Minister was doing his best, he was reading from a script that had been drafted before this debate took place. I listened to my noble friend Lord Lucas and the noble Lords, Lord de Clifford and Lord Goddard of Stockport. They were just giving ordinary examples that need clarity. We did not get from the Minister a clear exposition of how, in those individual cases instanced by colleagues in the debate, they could prevent the Minister’s overall objective. We all agree with him that we have to try to prevent the sort of situation that arose, which we all condemned, ever happening again. But do not let it be so wide that it will stop just minor organisational changes.

[Lord Leong (Lab)]

I thank the noble Lord for giving way. The principle here is that we have to consult with employees before the final resort. Fire and rehire should be the final resort and remedy. Before we even reach that, the whole process of consultation and sitting down and finding a solution should be an underpinning principle.

[Lord Hunt of Wirral (Con)]

I think we are all in agreement, except that the Bill goes too far. For a minor change of address when a company moves offices to be caught by all this in the way that we have exemplified—I think we need greater clarity. But, of course, the hour is late and I do not want to prolong the debate. In the meantime, I beg leave to withdraw the amendment.

Amendment 113ZA withdrawn.

Employment Rights Bill

Lord Hunt of Wirral Excerpts

Committee stage
Tuesday 3rd June 2025 Lords Chamber

Moved by

[Lord Hunt of Wirral]

131: After Clause 26, insert the following new Clause—
“Right of refusal to undertake instructions which would lead to inaccessible goods or services(1) A worker has the right to refuse an instruction or direction from his employer or anyone acting for his employer such as a manager which would—(a) cause the worker to undertake work which would result in the creation, development, deployment or sale of an inaccessible good or service,(b) cause the worker to undertake work which would result in the development, deployment or sale of a good or service, previously accessible, made inaccessible as a result of this instruction.(2) Any worker receiving such an instruction described in subsection (1) may report the nature of that instruction and their reason for refusing it to the Equality and Human Rights Commission.”

[Lord Hunt of Wirral (Con)]

My Lords, as we have already heard from the noble Viscount, Lord Colville of Culross, my noble friend Lord Holmes of Richmond cannot be with us today, so I will move his amendment on his behalf and speak to the others in this group. In doing so, I declare a past interest as a consultant to the Royal National Institute of Blind People. For many years, I worked with Ian Bruce CBE, who was the director-general for many years, to promote access to work for those suffering blindness. That is particularly relevant to Amendment 297, but I will speak first to Amendment 131.

Amendment 131 raises important questions about accessibility, accountability and the role of workers in upholding inclusive standards in the goods and services we create and deliver. The principle at the heart of this proposal—that workers should not be compelled to participate in making a product or service less accessible or in producing something that excludes by design—is serious and worthy. As technology and infrastructure continue to evolve, ensuring access for all, including people with a disability, is a matter not merely of compliance but of basic fairness and social responsibility. The amendment seeks to give workers a right of refusal where they are being asked to carry out work that would knowingly—that is, knowingly to them—result in the development or sale of inaccessible goods or services. It also establishes a route for reporting such an event to the Equality and Human Rights Commission.

I can certainly see the intent here to empower those on the front lines of design and delivery to raise concerns and to prevent regressions in accessibility. There are of course many questions about how this would operate in practice, particularly around definitions, scope and the safeguards needed to ensure clarity and fairness for both workers and employers. These are not reasons to dismiss the amendment, but they suggest that further discussion may be needed around implementation, enforcement and the supporting mechanisms that would then make such a right meaningful and workable.

We all have a role to play in embedding accessibility into our systems and structures. I hope, therefore, that the Minister will engage with the substance of the proposal and give thought to how the principle behind it might be taken forward, whether through this amendment or through other means.

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I hope that the noble Lord is satisfied that the Government are already taking many steps in support of disabled people, inside and outside the workplace. I therefore ask the noble Lord, my dear friend, to withdraw Amendment 131.

[Lord Hunt of Wirral (Con)]

My Lords, I am very grateful to the Minister, who always responds positively to any suggestions that I make, particularly in the corridors of this House. I should have declared not only my long-standing work with the Royal National Institute of Blind People but the much-appreciated instructions that “Brother Hunt” used to receive in substantial form from the Transport and General Workers’ Union. I was delighted, when I was Secretary of State for Employment, to be invited to the retirement party of Mr Albert Blighton, who was much cherished by all those who worked so hard for him.

I thank the Minister. I also thank the noble Lord, Lord Palmer of Childs Hill. We disagreed a little about royal commissions. I recall being told that they took minutes but wasted years—I think it was a previous Labour Prime Minister who said that. There is a problem in that, as soon as you set up a body, you are postponing the opportunity to make the key decisions that are necessary. I guess the Minister did recognise that in his response; we do need to move on. These statistics have been at a seriously low level for a long time, and we have to find a way to break through so that people with disability are much more widely recognised as people of great talent who can contribute to the growth and competitiveness that we all so desperately want to see.

I recognise that the Government have taken a number of initiatives, and I will consult with my noble friend Lord Holmes of Richmond as we consider how to approach this issue on Report, but in the meantime, I beg leave to withdraw the amendment.

Amendment 131 withdrawn.

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[Lord Goddard of Stockport (LD)]

My Lords, this amendment raises questions about notice periods and how they are handled under employment contracts. I make no particular case for or against it, but it draws attention to a more pressing issue: the complexity introduced by this Bill around notice periods and contractual exits. For many employers, particularly those without specialist legal support, understanding and implementing these new requirements will not be straightforward.

I am appreciative that this amendment attempts to bring some clarity and firmer parameters to that part of the framework. Striking the right balance is crucial: while shorter notice periods can support quicker recruitment and flexibility, they may limit employers’ ability to ensure a smooth handover or maintain continuity in key roles. Any reform should therefore weigh the benefits of agility against operational realities.

If the Government want compliance, they must ensure that the legislation is not only sound in principle but clear in practice. That means providing details on how these provisions interact with existing arrangements and what precisely is expected of employers. A complex system with vague guidance helps no one. That is not the first time we have made that point to the Government tonight, and we will keep doing so.

[Lord Hunt of Wirral (Con)]

My Lords, I thank my noble friend Lord Lucas for his amendment and the gentle way in which he introduced what could be a very important move to simplify what the noble Lord, Lord Goddard of Stockport, rightly reminded us is becoming a hugely complicated employment situation, with so many differing, complex and contradictory requirements.

It could be said—and is being said by a number of HR departments—that this is just the sort of Bill that will give an enormous boost to human resources as a profession. There are already queues of people lining up to join HR departments. My noble friend seeks a simple aim: to incentivise shorter notice periods and avoid situations where individuals are financially disadvantaged for moving jobs, especially when their employers insist on enforcing long notice terms.

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[Lord Ashcombe (Con)]

My Lords, I appreciate what the noble Baroness said, because this is about fairness and making sure life works. There are a lot of companies, big and small, where, to a great extent, what has been proposed is already working. However, there are a number of instances—including somewhere like where I work—where I do not think this would work.

I will just give your Lordships one quick example. I work in insurance for a huge insurance broker. We had a client in the United States who by 5 pm had not decided whether to renew his insurance contract in London. If he had not renewed it by 1 June—which I guess was a Sunday—he would have had no insurance on that specific part of his business. A member of my team kindly stayed online, for want of a better word—he was probably out and about with the phone in his pocket—and the call came through at some time after 9 pm. Looking at the way the clause is drafted, I am not sure whether that would be considered enough of an emergency to get a member of staff out of bed, so to speak. Equally, that company might have had to stop working, doing whatever it was doing in the oil and gas industry—I know that will not endear me to the noble Baroness, but that is a fact. But we had to bind that insurance contract once we got the order. It was all ready to go; it was just a question of sending a number of emails to say that it was done. So there are huge swathes of the country where it is in fact in place already, as the noble Baroness, Lady Coffey, has said, but in some of the big City environments where you are working across time zones particularly, it is extremely difficult to enact.

On working from home, we all worked at home for some time; personally I loathed it—I am back in the office almost as much as I can be. However, I have members of staff who like working at home, and, let me tell your Lordships, they know how to turn themselves off when they do not want to talk to us anymore, and they are good at it. So they should be, and I respect them for it. But if you really need them, you can always find them.

Finally, you can turn the damn machines off. Be it a telephone, a computer, an iPad or whatever it is, there is an off button out there. Certainly when I was a child, we were told never to call anybody after 9 pm, and that was friends and family. So there are some unwritten rules out there that are already very effective.

[Lord Hunt of Wirral (Con)]

My Lords, we are very grateful indeed to the noble Baroness, Lady Jones of Moulsecoomb, for introducing us to a fascinating debate. The noble Lord, Lord Goddard of Stockport, put us in touch with the real world, and then my noble friends Lady Coffey and Lord Ashcombe reminded us about what happens in real life. I suppose I have immediately to declare my interest as a practising solicitor. My phrase, which I always used to share with Albert Blighton, was that I was available 168/52. The number 168 is 24 times seven. So you quickly appreciate that, as a solicitor, you have to be available all the time.

When I won the contract to represent cricket with the England and Wales Cricket Board, they wanted to know whether I would be available on a Sunday evening when there was an incident at a Sunday league match, and I said, “Yes, of course I would”. So it is very much up to the individual to make themselves available.

When I was asked to join the Front Bench in the House of Commons in 1977, I do not think anybody expected that I would refuse to answer an Adjournment debate, even though it might have been at 3 am, which it was on one occasion. Therefore, you set your working parameter in the way in which you develop your own workaholic tendencies, but you should not expect it of everyone, and I think that is what the amendment is all about.

Do you have the right to disconnect? Although I am sympathetic to the idea that you should be able to switch off, which the noble Lord, Lord Goddard, put in context, when the Bill is already introducing considerable uncertainty for employers around shift notice periods, payment for cancelled shifts and wider questions of how flexible working is to be managed in practice, we have to be very cautious about layering on yet another rigid and potentially burdensome obligation.

The noble Baroness may have put forward what appears to be a straightforward proposal, giving workers a right not to respond to emails or calls outside their contracted hours, but in reality, as the Government have quickly realised, despite what they may have said in advance of the election, this whole proposal raises serious practical and legal questions. What does “working hours” mean in a world of flexible, hybrid and self-managed work? How do we define an emergency? What happens in small teams, in customer-facing sectors, which my noble friend Lord Ashcombe highlighted, and in businesses operating across time zones?

Employers, especially small businesses, already face growing compliance costs. This would add yet another administrative requirement. There would have to be a written policy on the right to disconnect, a consultation process, enforcement procedures and, of course, exposure to tribunal claims. So, we must ask: is this really the right moment to introduce such sweeping regulation?

The Bill already creates new rights and obligations that will take time to bed in. There is uncertainty around shift scheduling, compensation for cancellations and the cumulative compliance burden. I have to say to the noble Baroness that I believe the effect of this amendment would be to increase that uncertainty further and risk undermining flexibility for both sides. Most workers and employers already navigate these boundaries reasonably and sensibly. A blanket legislative approach risks making day-to-day communications feel legally fraught, especially in smaller organisations where roles are not so rigidly defined.

[Lord Leong (Lab)]

My Lords, I thank the noble Baroness, Lady Bennett of Manor Castle, for tabling Amendment 141B, which was moved by the noble Baroness, Lady Jones of Moulsecoomb.

We firmly recognise the vital importance of achieving a healthy work/life balance. The noble Baroness and the noble Lord, Lord Goddard, can be confident that we will indeed introduce a right to switch off. We understand that, in today’s fast-paced world, it is more important than ever to ensure that individuals and families are able to manage the demands of their work alongside their responsibilities and needs at home.

Our close consultation with businesses and civil society since the election has shown how important it is that we develop this policy in collaboration with those who will be affected: workers and the firms who employ them. The right to switch off must account for the full diversity in types of employment and sectors that exist in our modern economy. It represents a substantial shift in the way some businesses operate. This amendment does not account for that diversity and the need for collaboration. That is why we have decided to take a careful and considered approach to introducing the right to switch off, as was alluded to by the noble Baroness, Lady Coffey, and the noble Lord, Lord Ashcombe.

The focus for now is the Employment Rights Bill, which contains decisive and immediate action, such as reforms to flexible working that will make it easier to strike a better work/life balance. These reforms are not just policies; they are practical steps to support everyday lives and help people to draw clearer boundaries between their work and personal lives.

To add this amendment to the Bill would not do the right to switch off any justice. As drafted, it could create unnecessary burdens on businesses, particularly small businesses, as stated by the noble Lord, Lord Hunt. Significant new requirements in proposed new subsection (3)(a) to (d) would force all employers, no matter their size, to produce written disconnection policies and specify new technological and organisational measures and protocols, while also establishing reporting systems for any violations. These new rules would be onerous and inflexible.

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Moved by

[Lord Hunt of Wirral]

141BA: Clause 27, page 47, line 13, at end insert—
“(B1) Subsection (A1)(a) shall not apply where the employer is undergoing relevant insolvency proceedings.(C1) Where the employer is undergoing relevant insolvency proceedings, the duty to consult shall arise only in accordance with subsection (1), by reference to the number of employees proposed to be dismissed at a single establishment within a period of 90 days or less.(D1) For the purposes of subsection (B1), “relevant insolvency proceedings” has the same meaning as in regulation 8(6) of the Transfer of Undertakings (Protection of Employment) Regulations 2006.”Member’s explanatory statement
This amendment ensures that employers in formal insolvency proceedings are not subject to the new entity-wide redundancy consultation trigger. Instead, the existing “20 or more at one establishment” threshold would apply. The amendment relies on an established definition of insolvency proceedings, consistent with Regulation 8(6) of TUPE 2006.

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[Lord Hunt of Wirral (Con)]

My Lords, Amendments 141BA to 142B stand in my name and that of my noble friend Lord Sharpe of Epsom.

Collective redundancies often occur in the context of an insolvency. Increasing the penalty for failure to inform and consult will exacerbate the difficulties for insolvency practitioners. Under the Insolvency Act 1986, administrators are required to act in the best interests of creditors as a whole. However, keeping employees in employment beyond the 14-day window afforded to administrators to decide whether to adopt the contract, to carry out an information and consultation process, in effect makes those employees super-priority creditors. This would elevate their claims above those of other creditors and reduce the funds available for ordinary creditors. In some cases, the resulting employment costs could make administrators reluctant to take on their role. This may lead to fewer contracts being adopted, increasing the liabilities that ultimately fall on the National Insurance Fund. Amendment 141BA gives insolvency practitioners clear legal guidance to apply the single establishment rule during consultations. This helps them make faster decisions without dealing with complex, entity-wide assessments, reducing delays and protecting insolvency processes. It supports rescuing businesses and, of course, maximising creditor returns.

I turn to Amendments 141C and 141E. Clause 27 significantly expands the duty to consult on collective redundancies. It requires employers to start a consultation if 20 or more redundancies are proposed in total across multiple establishments, even when those redundancies are unrelated. This overreaches, because simultaneous job cuts can result from distinct decisions, such as automation in a warehouse, reduced demand in customer service or restructuring in head office, affecting different people in different locations. Yet, under Clause 27, those decisions could be swept into a single mandatory consultation process simply because the total number affected crosses the arbitrary threshold. This means that HR and management teams would have to delay necessary action while they co-ordinated across unrelated departments. This means that representatives and employees would be dragged into consultations about matters with no relevance at all to them, and it risks undermining the quality of consultation itself by overloading it with conflicting priorities and timelines.

This would introduce legal uncertainty, particularly for mid-sized employers who may not have the resources to second-guess whether redundancies in different divisions are connected enough to trigger a combined consultation. If they get it wrong, they will face a protective award. If so, the risk-averse approach is to consult everyone about everything all at once. These amendments would make it clear that where redundancies across different establishments arise from a common underlying business reason, or from a connected series of events, a combined consultation is indeed required. However, where they are unconnected, made independently and for distinct reasons, the employer may conduct separate consultations at the level where the impact is felt.

Moving to Amendment 141D, we have continued to make the point that the one-sized central planning approach that this Bill uses is not appropriate. Many sectors rely heavily on seasonal or fixed-term workers. Agriculture, hospitality, logistics and retail businesses scale up and down, predictably, year in, year out. They take on workers for peak periods—the summer season, the Christmas rush, the harvest—and release them at the end of the contract. These are not sudden decisions; they are built into the business model and are clearly understood by all parties. For example, a national employer may let 12 seasonal workers go at a distribution hub in the north in July. A month later, it may make seven short-term administrative contracts redundant in the Midlands. In September, it might end six fixed-term roles in a tourist-focused retail unit in the south. Those are unconnected, expected and localised decisions. However, under Clause 27 as drafted, those 25 redundancies must be aggregated, triggering a full collective consultation process across all three events as if they were part of one co-ordinated business strategy. Is that really the policy intention?

Amendment 141F tackles the risk of retroactive liability—the possibility that employers who have already commenced consultations in good faith could be told after the fact that their earlier actions were invalid or insufficient, simply because the later redundancies pushed the total over the threshold. This problem arises from the way in which the 90-day window operates. It is measured forwards and backwards from any given proposal, which means that an employer making a set of redundancies today must ask, “Did I make others 30, 60 or 89 days ago?” If so, they now need to be bundled into a new retroactive consultation process. Let us say that an employer consults properly with a small team—five redundancies, full process, representatives informed; and then some weeks later, it identifies the need to make redundancies in another part of the business. The total now crosses the threshold and suddenly, it faces legal uncertainty. Was the earlier consultation valid? This creates a legal trap for employers acting in good faith. It penalises those who move early, communicate openly and begin consultation promptly—the very behaviours the law should be encouraging.

This amendment would bring common sense to the process. It says that where meaningful consultation on a proposed dismissal has already begun, whether individually or collectively, those redundancies are not to be re-counted towards a later threshold. It prevents the law demanding the impossible: that employers retroactively reconvene consultations that were lawfully and properly carried out before a threshold was even triggered.

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[Lord Leong (Lab)]

My Lords, I thank the noble Lords, Lord Sharpe of Epsom and Lord Hunt of Wirral, for tabling these amendments. We have been listening to feedback from businesses on the clause as introduced. It requires collective consultation whenever 20 or more redundancies are proposed to be made across an employer’s organisation. Businesses told us that this would put them in a constant state of consultation. That is why we have made amendments in Clause 27 to the Trade Union and Labour Relations (Consolidation) Act 1992; they aim to limit the burdens on employers while still expanding protections for employees, by ensuring that collective consultation is triggered when a threshold number of employees are proposed to be made redundant across an entire organisation.

The purpose of Clause 27 is to strengthen collective redundancy rights. The Government worked with stakeholders, including businesses, to address their concerns, which include not counting employees who are already being consulted on redundancy. We will set an appropriate threshold number in due course, via secondary legislation, following further engagement with stakeholders and a public consultation. We will look to balance the interests of both employers and employees when setting this threshold. Business stake- holders have welcomed the Government’s engagement on this clause and the opportunity to input to the threshold number via a public consultation.

Amendment 141BA seeks to exclude employers going through insolvency proceedings from the scope of a new trigger for collective consultation. I refer to the point made by the noble Lord, Lord Moynihan of Chelsea, about how one expects an employer which is going insolvent to consult employees across the entire organisation. The Government believe that collective consultations are an important part of ensuring fairness and transparency between employers and employees. The benefits of consultations are felt by both. I heard what the noble Lord said, and I must say that employees are an important part of the organisation, as are the suppliers and the whole supply chain. Whatever is due to them should be paid, as is the same for other creditors.

The law already recognises that consultation may not always be fully practical in insolvency situations. That is why Section 188(7) of the Trade Union and Labour Relations (Consolidation) Act 1992 includes a special circumstances defence for employers to depart from the collective redundancy obligations where it is genuinely justified and they have shown that they have taken all practical steps to comply. That flexibility should be applied on a case-by-case basis, not by removing that duty altogether.

Amendment 141C seeks to ensure that obligations are triggered only where redundancies are linked to a connected reason. We recognise that collective consultation will be most productive when workers and employers are focused on a common issue. However, employers and unions have told us that they believe it is not possible to define what is connected or “common reasons” in a suitable, clear way and that this could lead to more litigation. They tell us that attempting to restrict these new rights to connected redundancies in this way would create further burdens, rather than relieving them.

Amendment 141D seeks to exclude seasonal workers or those on fixed-term contracts from the scope of collective redundancy measures in the Bill. First, it may reassure the noble Lord to know that the expiry of a fixed-term contract at the end of its term does not trigger collective consultation obligations. Therefore, any fixed-term contract expiring at the end of its term will not add to the running total for the new threshold introduced for collective redundancies. We will consider further how employees on fixed-term contracts should be counted for the purposes of calculating an employer’s overall workforce that might be needed for the purposes of a national trigger for collective redundancies.

Amendment 141E aims to avoid an obligation to combine consultation by inserting two new subsections into Section 188 of the Trade Union and Labour Relations (Consolidation) Act 1992, but new subsection (2A) already strikes the right balance here. Employers will be well placed to determine how to divide consultations appropriately where the national threshold has been met. We agree that each group should receive meaningful collective consultation and intend to set up guidance on this point in a new code of practice.

On Amendment 141F, it is already the case that where collective consultation on redundancies has already begun those redundancies will not be counted when determining whether subsequent new redundancies reach the threshold for collective consultation. We do not believe that this should be extended to exclude employees who have been individually consulted, as individual redundancy consultations have a different character and purpose from collective consultations.

On Amendment 142, we agree with the noble Lord that the threshold number that will trigger collective consultation should be proportionate and not overly and unnecessarily burdensome on employers. However, this amendment is unnecessary and disproportionate to address this issue.

On Amendment 142A, the term “establishment” has already been settled and is well understood in employment law. It works well in practice, so we consider that attempts to change the definition here would create confusion and lead to more litigation with very few clear benefits in return.

Finally, Amendment 142B would undo the Government’s extension of the protective award period to 180 days. This change was made following a full public consultation in October 2024 and has been carefully considered. It makes it harder for unscrupulous employers to price in non-compliance with their collective consultation obligations, as we saw in the case of P&O Ferries. The Government are committed to strengthening employment rights in this landmark legislation. I therefore ask the noble Lord to withdraw Amendment 141BA.

[Lord Hunt of Wirral (Con)]

The Minister started off by referring to government amendments. I just wonder which amendments he is referring to, because I am not aware that any other government amendments to Clause 57 are planned.

[Lord Leong (Lab)]

I apologise. I can be much clearer. I said the amendments tabled in the other place which are now under Clause 27.

[Lord Hunt of Wirral (Con)]

This has been a very valuable debate on a very important clause, Clause 27. I am very grateful to my noble friends Lord Moynihan of Chelsea, Lady Lawlor and Lady Coffey, who gave some practical examples, particularly of the unintended consequences of previous legislation. A lot of questions have been raised by the Minister. I do not want to prolong this debate now, so I summarise by saying that there are many questions that we still want to ask and we will be returning to this on Report. In the meantime, I beg leave to withdraw the amendment.

Amendment 141BA withdrawn.

Employment Rights Bill

Lord Hunt of Wirral Excerpts

Committee stage
Tuesday 3rd June 2025 Lords Chamber

[Baroness Whitaker (Lab)]

My Lords, I support all the amendments in this group and will speak to my Amendment 200ABA. Our seafarers are the engine of a vital part of our trading economy, but their conditions of work are often out of sight and out of mind. Among other problems, as set out by my noble friend Lord Davies of Brixton, the gender imbalance and isolation on most ships has resulted, sadly, in risks for women which need clear measures of protection.

Of the 23,700 United Kingdom seafarers counted in 2024, only 16% were female. These were mainly among ratings and uncertificated officers—that is, those with the least authority and power. I heard of a nasty case of rape on a cruise ship, where the victim, significantly, said that she had no help from the HR department because she was too shocked to report it immediately. She was advised that her only recourse was to leave the ship, because the perpetrator was needed on board—a not uncommon reaction. Some privately owned super- yachts require applicants for jobs to submit photographs and “be comfortable with nudity”, which gives a flavour of the work environment.

Research from the Seafarers International Research Centre at Cardiff University shows how fearful women seafarers on cargo ships are of sexual assault and how lonely they can feel in their workplace. We have now the seafarers’ charter, announced by the Government last December. This provides the vehicle for vastly improved standards for seafarers’ working conditions, but it needs to clarify that it will specify protection against sexual harassment and bullying—hence my amendment.

Our shipping force is declining, not least in the retention of women, and there are skills gaps. This has put pressure on workplace standards, resulting in seafarers in general having a higher rate of sickness and accidents than onshore workpeople. There are industry initiatives to encourage recruitment, but little thought on making workplaces safe, convenient and welcoming to women. We can attract more people into it if everyone feels safe.

[Lord Hunt of Wirral (Con)]

My Lords, I am very grateful to the noble Lord, Lord Davies of Brixton, for so clearly setting out the case for a range of amendments. As he made clear, the matters under discussion go to the heart of how we uphold standards for those who work at sea, an essential part of our economy and infrastructure. Of course, we are all well aware of the extent to which the events surrounding P&O Ferries in 2022 were a stark reminder of the vulnerabilities that are faced by seafarers operating in and around UK waters. I am very grateful to the noble Baroness, Lady Whitaker, for reminding us of some pretty stark situations that are faced by people who work in this environment.

I was very pleased and proud when the Conservative Government took clear and concrete steps to improve protections, most notably through the Seafarers Wages Act 2023, the introduction of the voluntary seafarers’ charter and a broader nine-point plan aimed at promoting fairer treatment and higher standards across the sector. These reforms represent a record of action that reflects the seriousness with which we take the obligations owed to maritime workers and our determination that what happened—that unacceptable practice that we all saw and were so concerned about—must never happen again.

Today’s amendments reflect continued concern for the welfare and rights of seafarers. They raise, though, a number of detailed questions about scope, enforcement and the role of harbour authorities. I am pleased to see the noble Lord, Lord Hendy of Richmond Hill, here to reply to this debate, because we want to hear from him how the Government see these provisions fitting alongside the reforms already undertaken. We await with bated breath his reply to this important debate.

[The Minister of State, Department for Transport (Lord Hendy of Richmond Hill) (Lab)]

My Lords, I will first speak to government Amendments 200B and 200C. These amendments relate to Clause 54, which amends the Merchant Shipping Act 1995 to provide powers to make regulations giving effect to international agreements relating to maritime employment. Amendment 200B provides that such regulations cannot be used to bring into force an international agreement, or an amendment to an international agreement which requires ratification, before the UK has ratified it. By implication, the effect of this amendment is that such regulations can be made ahead of ratification of the agreement or amendment. For the UK to ratify an international agreement, it is usual for any necessary implementing legislation to be passed or made in advance of ratification, so the amendment helps ensure that the UK can fulfil its international obligations. Amendment 200C is simply a consequential drafting amendment.

Amendments 143A and 143AA, tabled by my noble friend Lord Davies of Brixton, seek to amend the requirements of the collective redundancy notification provisions to apply to services calling at a port in Great Britain at least 52 times a year, rather than 120 times a year. We are, as my noble friend and the noble Lord, Lord Hunt of Wirral, related, yet again dealing with the appalling events surrounding the P&O dispute in March 2022. As with the Seafarers’ Wages Act, the frequency requirement of this measure was designed to ensure that it applied to those services with a close enough connection to the United Kingdom to justify it. Any broadening of the scope would require further consideration of the impact of bringing further vessels into it. I will come on to the proposed amendments to the scope of the Seafarers’ Wages Act, but we do not accept the proposal to amend the scope of those measures. We will apply a consistent approach to the proposed changes to the scope of the collective redundancy requirements, which has the same frequency requirement. Any change would require stakeholder engagement and full consideration of the impacts on industry. However, having listened carefully to my noble friend Lord Davies of Brixton, we will agree to meet the trade unions, as he suggests, where a number of the issues that he has raised tonight can be further discussed, including the requirement for a summary of the Government’s position before Report.

Amendments 200AA, 200AB and 200AC, also tabled by my noble friend Lord Davies of Brixton, seek to apply the measures under the Seafarers’ Wages Act 2023 as amended by this Bill to weekly services rather than those calling 120 times a year as drafted. The existing minimum frequency requirement for the new remuneration and safe working declarations is consistent with the requirements under the existing Seafarers’ Wages Act 2023, which was brought into force on 1 December 2024. It is important that this measure be limited to services with a close enough connection to the UK to justify intervention in their working practices; the current requirements in the Seafarers’ Wages Act and in the Act as amended in this Bill have been designed with this in mind. Extending the scope of this measure would require careful consideration of the international law implications of bringing into scope less frequent services to the UK, as well as the impacts on the market. With these considerations in mind, we think that the existing scope strikes the correct balance. It would also not be right to accept this amendment without undertaking a full public consultation, which cannot be done in the timescales required to make this change as part of the Bill.

Amendment 200AD and the consequential Amendments 200AE to 200AK would go beyond the existing powers in the Bill to make safe working and remuneration regulations. It would provide further powers to specify conditions relating to sick pay, holiday pay, pensions and other training, and to require harbour authorities to request the associated declarations from operators, following the approach taken by the Government in relation to the remuneration and safe working regulations.

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Removing this clause would risk depriving many employers of a useful and necessary framework for understanding the inequality dynamics within their own workforce. Data without action achieves little. Equality action plans help translate information into strategy, encouraging employers not just to measure the problem but to engage with it. You have to have the data before you can actually deal with that. At a time when many organisations are seeking to do more to build inclusive and equitable workplaces, this clause offers structure and accountability. I urge noble Lords to resist the clause stand part notice and to support this considered and constructive provision.

[Lord Hunt of Wirral (Con)]

My Lords, I thank the noble Baroness, Lady Fox of Buckley, and my noble friends Lady Lawlor and Lord Jackson of Peterborough because they rightly question whether this clause is necessary to establish what we all agree should be the vital place for equality of opportunity.

It is vital in the workplace that merit should win the day, but there should also be equality of opportunity. Women and men should have equal opportunities, fair treatment and the freedom to thrive regardless of their background. So I hope all those who have spoken, including the noble Lords, Lord Watson of Invergowrie and Lord Palmer of Childs Hill, would agree that we all support equality of opportunity, not just in principle but in practice.

Therefore, it is right that every time there is another step, particularly when it creates more paperwork and more bureaucracy—as the noble Baroness, Lady Fox of Buckley, put it—it is important that we just question whether this is the right way to proceed, particularly, as my noble friend Lord Jackson of Peterborough pointed out, because this is really giving the Government power to do whatever they want to do whenever they wish to do it, by regulation. We do not know what the Government will do because they have not yet consulted on the power that we are about to give them. It is exactly what this House has always preached long and hard against. We should not give Henry VIII powers to the Government to do whatever they would like to do by statutory instrument.

I would have thought that my successor as chair of the Secondary Legislation Scrutiny Committee—the noble Lord, Lord Watson of Invergowrie—would know that more than anyone else. Giving the Government this power has to be justified. My noble friend Lady Fox of Buckley does not need me to defend her against the noble Lord, Lord Watson of Invergowrie, as he saw her move across the political spectrum, but she is right to question this in the way she did. As my noble friend Lady Lawlor put it, we are, in a way, promoting positive discrimination, which undermines achievement on merit.

I hope that the Minister will give very serious thought to explaining exactly what is proposed, rather than wait for the secondary legislation. Let us know, straightaway and in detail, what additional equality action plans are being proposed. We have to pause for a moment to worry about the serious and often unintended consequences that policies such as these can have, particularly for women on the margins of the labour market. The principle behind the measure is commendable —to close the gender gaps, to support women through challenges such as the menopause, and to shine a light on structural inequalities—but, in practice, these kinds of top-down mandates too often result in box-ticking compliance, statistical quotas and public relations targets, and never in real progress.

What gets measured drives what gets managed. When employers are judged by headline figures—gender pay gaps, representation in senior roles—there is an inevitable temptation for them to focus their efforts where the optics are best improved, on high-status, high-visibility roles. As a result, employers might feel pressured to hire or promote individuals with certain characteristics into elite positions just to improve those diversity statistics, rather than genuinely supporting a larger number of people, who are often the minority, who hold lower-paid, insecure or part-time roles and who would benefit most from meaningful reform.

Regardless of sex, ethnicity or sexual orientation, merit should always be the basis for the advancement of an individual. I worry that we risk a situation where the beneficiaries of an equality policy are disproportionately those who are already relatively privileged, while those in cleaning jobs, care work, warehouses, and food processing and service are pushed further to the margins. Even worse, if statistical appearances become the basis of legal or reputational risk, employers may become reluctant to hire minority women at all into lower-paying roles for fear of what the data might suggest. That is not progress; it is perverse.

I warmly applaud the fact that this debate is taking place. Equality is not achieved by engineering the statistics; it is achieved when every person, regardless of sex, class, race or role, has access to fair work, safe conditions, proper pay and genuine opportunity to get on in life. I ask colleagues to consider: will these equality action plans bring meaningful change for working-class young men, people from ethnic minorities and women on zero-hours contracts, or will they largely serve the HR departments of large organisations by helping to polish their diversity reports while little changes on the ground? We cannot effect equality by appearance; we must demand equality by substance.

[Lord in Waiting/Government Whip (Lord Collins of Highbury) (Lab)]

My Lords, I am grateful to the noble Baroness, Lady Fox, for initiating this probing debate on Clause 31. As the noble Lord, Lord Hunt, highlighted—I like to call him my noble brother after all these years of working together—it enables us to put forward a very strong case. One can always be concerned about Henry VIII powers and secondary legislation, especially when employers are not consulted and the objective is to undermine good industrial relations. I remind my noble brother about the debates we had on the strikes Bill, which was precisely about those issues of unintended consequences.

Ensuring that women can remain in and progress in work is crucial—vital—to economic growth, and yet the national gender pay gap remains at 13.1%. We know that women often face barriers in the workplace that impact their pay, progression and economic participation. Eight in 10 menopausal women say that their workplace has no basic support in place. This lack of support is a barrier and can lead to a significant loss of talent and, just as importantly, productivity.

This is not new. As a trade unionist, I, and my noble brother opposite, know full well—we have heard about all the legislation that has been brought in—that real progress has been effected in the workplace by supporting and amplifying that legislation and giving people the tools to ensure that that legislation has an impact. As a trade unionist, I have seen many initiatives that have delivered better facilities and ensured that women can remain active in the workplace.

I remember a campaign in the 70s and 80s about breast cancer. Many women would not even dare talk about it, but the trade union movement launched a campaign for workplace screening and opened up a debate, so that people could acknowledge the risks and address them, rather than live in isolation and fear. It is important that women are able to talk about the menopause openly and can address it. Breast cancer does not make women victims. We should all be focused on how we can deliver for women. That is really important, and there are many examples.

Since 2017, large employers have been required to publish gender pay gap data. The additional publication of an action plan is precisely to do what the noble Lord opposite has said. How do we see and assess the impact? The additional publication of an action plan has been encouraged, but it is voluntary. However, analysis in 2019 discovered that only half of employers reporting data were voluntarily producing a plan on how they can make improvements. What the noble Lord described is what has happened: they produce the data and do nothing. That is why this legislation is so important, and the next step for improvements for women in the workplace is to make that mandatory.

Of course, we recognise and applaud the best employers, which already recognise the value of supporting women to thrive and are already taking action—many noble Lords addressed that. Following their lead, large employers will be required to detail the actions they are taking to improve gender equality and support employees during the menopause. The intention is to motivate employers to take meaningful action, to break down the barriers and help all women to thrive.

Employment Rights Bill

Lord Hunt of Wirral Excerpts

Committee stage
Thursday 5th June 2025 Lords Chamber

[Baroness Coffey (Con)]

My Lords, I am quite concerned about this amendment, although I rarely disagree with my noble friend Lord Holmes of Richmond. I am just concerned about the number of agencies or government bodies that keep being created. We already have considerable regulation in this country; I am not convinced that this will add value. Although I recognise the reasons why my noble friend put this forward, I hope he might reconsider tabling it again on Report, if he was so minded.

[Lord Hunt of Wirral (Con)]

My Lords, I start by saying how pleased we are to see my noble friend Lord Holmes of Richmond in his place. I had the privilege of moving his previous amendments in his absence, but we are delighted to see him back with us and I thank him for proposing this important amendment.

The way my noble friend did it was very welcome because, at the heart of his speech, was a recognition that the labour market—especially the supply of temporary and agency workers—has to be fair and transparent. He used those particular words and stressed their importance. I agree with him that it is essential that all companies involved in these arrangements operate under the same clear set of rules. Too often, we see instances where umbrella companies or certain intermediaries do not meet the standards expected of traditional employment agencies, whether on pay, workers’ rights or transparency. This inconsistency undermines the integrity of the labour market and can put vulnerable workers at risk. Licensing could, in theory, help address this by ensuring that any business participating in employment arrangements meets minimum standards and is subject to proper oversight.

However, as my noble friend Lady Coffey stressed, the amendment raises some other important questions. Clause 34 broadens the definition of “employment business” to encompass a range of activities connected to supplying workers who are employed by one party but work under the control of another. This means that the regulatory net will be set much wider than before, potentially to cover businesses beyond traditional recruitment agencies.

Moreover, it is worth considering whether the same objectives could be achieved through improved enforcement of existing regulations rather than by introducing a new licensing framework. In this Chamber, we have to weigh carefully the costs and benefits, particularly to smaller businesses that may struggle with additional compliance burdens. We must also consider the impact on businesses and the wider economy. Many employment businesses operate with tight margins; for them, licensing means added costs, added paperwork and longer lead times to launch new services or respond to labour demand.

This is not an argument against regulation per se; it is simply a recognition that badly designed or poorly phased licensing can create barriers to entry, reduce competition and even push some providers underground, where abuses are harder to detect. In sectors that are already experiencing labour shortages, such as social care, hospitality and logistics, the cumulative impact could be significant.

As my noble friend Lady Coffey pointed out, there is also the risk of regulatory duplication or conflict. Some sectors already have licensing or registration schemes; others are subject to sector-specific standards set by Ofsted, the Care Quality Commission or the Financial Conduct Authority. Without co-ordination, we risk creating overlapping regimes, with businesses subject to multiple audits, rival codes of conduct and inconsistent enforcement. Workers too may be confused about their rights and the mechanisms available for redress.

I also note that the amendment does not contain any provisions for parliamentary oversight or consultation. The power it seeks to create is broad and, while it is subject to the discretion of the Secretary of State, it is not constrained by any statutory duty to consult stakeholders. In a sector as economically important and socially sensitive as this, there must be consultation. Against that background, I look forward to hearing the Minister’s response.

[Lord in Waiting/Government Whip (Lord Katz) (Lab)]

My Lords, I thank the noble Lord, Lord Holmes of Richmond, for his amendment concerning the licensing of employment businesses. I join the noble Lord, Lord Hunt, in saying how nice it is to see him in his place this afternoon. I share the privilege that the noble Lord, Lord Hunt, noted as I responded to the amendments that were tabled in the name of the noble Lord, Lord Holmes, and these were on important issues that he was right to raise. As the noble Lord, Lord Hunt, said, these are around fairness, transparency, equity and the problems that some less than scrupulous umbrella organisations and employment agencies currently raise in the market. He is not raising unimportant issues.

As the noble Lord, Lord Hunt, has already noted, through Clause 34, the Government have sought to amend the definition of “employment business” in the Employment Agencies Act 1973, so that it includes the concept of employment arrangements. This expanded definition will capture so-called umbrella companies and place them in the scope of regulation. As your Lordships know, employment businesses are subject to regulation through the Conduct of Employment Agencies and Employment Businesses Regulations 2003, which were enforced by the Employment Agency Standards Inspectorate and subsequently will be enforced by the new fair work agency that Part 5 of the Bill creates.

The Government acknowledge that the current regulations are not appropriate for application to umbrella companies so, following consultation, we will set out a new regulatory framework that will apply to umbrella companies. In our view, these regulations are the most proportionate way of reducing non-compliance in the umbrella company market, without introducing a new regime that would add complexity for business. The creation of a licensing authority at this time would therefore not be appropriate. I am happy to say that on this rare occasion, we share the concerns of both the Opposition Front Bench and the noble Baroness, Lady Coffey, from whom we heard earlier on this amendment.

The regulation-making powers in the Bill have been carefully considered and included only where the Government consider it justified and necessary. We are not convinced that the amendment will provide additional benefits for businesses or workers significant enough to expand this power, as it proposes.

The Government want to take care to get the regulations right. We have heard throughout our wonderful time spent discussing the Bill in Committee so far that there is a balance to be sought between the burdens that we create through new legislation and regulation on businesses, including small businesses, and protecting the rights of workers. It is a balance we get right, and we want to make sure that we get regulations right in relation to the new definition of employment businesses in this case. Our focus will be on that, alongside the establishment of the fair work agency.

Taking all these factors into consideration, I therefore ask the noble Lord, Lord Holmes of Richmond, to withdraw his amendment.

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[Lord Prentis of Leeds (Lab)]

I thank the noble Baroness for that comment.

The whole intention appears to be to limit the scope of any collective bargaining. It is as clear as day. Different forms of words can be come up with concerning who is involved, who should clear what, and so on. That delays things, and that is the intention of the amendments before us.

Noble Lords have to understand that the proposals legislate for the Secretary of State or their nominee to be involved in the negotiating body. I personally have no reservations about that. We want to talk to the people who have the power and the influence to make decisions that improve the service and teaching in our schools. This proposed new body is intended to improve schools and education. What better way of doing it than to bring people together, give them a voice, allow it to be heard and come to conclusions which are for the benefit of all?

[Lord Hunt of Wirral (Con)]

My Lords, this has been a very important debate, and I thank my noble friends Lady Barran and Lady Coffey for their amendments in this group. We have had some very interesting real-life examples given by my noble friend Lord Agnew of Oulton, and an important dimension from the noble Lord, Lord Prentis of Leeds, to which I will return in a moment.

I am, however, pleased to speak in support of Amendment 151, introduced by my noble friend Lady Barran. This amendment highlights an essential but often underappreciated part of our school workforce: the support staff. That is where I would agree with the noble Lord, Lord Prentis of Leeds. Those support staff keep schools running smoothly every day. From teaching assistants to catering teams, their work is vital, and as my noble friend put it, they form the backbone of the whole system.

The Government’s Bill takes a step forward by proposing the creation of a school support staff negotiating body, and I make it clear that I believe that is a welcome move. However, the Bill’s current approach, with its push for a single set of national pay and conditions, risks overlooking the real differences which exist between schools, as my noble friend Lord Agnew of Oulton pointed out, especially between maintained schools and academies.

What this amendment does so well is to recognise the need for a flexible framework for academies, one that they must consider and may depart from only in exceptional circumstances. This respects academies’ independence while still promoting fairness and consistency.

We must of course remember that “support staff” is a broad term covering a wide range of roles and responsibilities. The needs of a small primary school and a large multi-academy trust are not at all the same, and any framework has to reflect that diversity. Like in most areas of the Bill, the Government have taken a rigid, one-size-fits-all model that I am concerned could create confusion and strain resources. Instead, a balanced framework such as the one my noble friend proposes offers a practical way to support staff fairly, without unnecessary bureaucracy.

My noble friend also raised an important point about the potential costs and bureaucratic complexity that come with establishing another negotiating body such as the school support staff negotiating body. This is not just about money but about the practical demands placed on schools and trusts, especially smaller ones with limited administrative capacity.

Setting up and maintaining a new national negotiating framework involves significant resources: time, personnel and funding. Schools will need to engage with the school support staff negotiating body’s processes, potentially adapt to new systems for pay, terms and training, and ensure compliance with frameworks that may be complex and constantly evolving.

For large multi-academy trusts, this might be manageable, but for smaller schools—already stretched thin—it adds a layer of bureaucracy that can divert valuable time and resources away from teaching and supporting pupils. Moreover, the negotiation and implementation processes risk becoming slow and cumbersome, delaying important decisions on staff pay and conditions. This could lead to uncertainty and frustration among support staff and their employers alike.

I particularly thank my noble friend Lady Coffey for her insightful remarks. She makes a compelling and important point: the Secretary of State is already required to consult the prescribed school support staff organisations, which represent the full spectrum of support staff voices, yet this amendment rightly challenges why the Trades Union Congress should be given a special, privileged position with an additional mandatory consultation in primary legislation that risks unnecessary delay, added bureaucracy and potential obstruction.

Although the TUC is of course a major trade union umbrella—many colleagues across the Chamber will remind us of its history—it does not have a monopoly on representing school support staff. Many staff organisations operate independently and effectively without TUC oversight. Therefore, by insisting on formal TUC consultations, we risk entrenching a narrow set of interests, potentially sidelining smaller or non-TUC affiliated groups that also deserve a seat at the table.

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[Lord Prentis of Leeds (Lab)]

My Lords, many of my noble friends have spoken about the possible collapse of the social care system. The toxic combination of chronic underfunding and the dysfunctional market system means that thousands of elderly and disabled people do not get the care that they need. I welcome the proposals in the Bill to establish a framework to establish legally binding agreements that, at long last, would set pay, conditions and terms for workers in the adult social care sector: an adult social care negotiating body in England made up of relevant employers and trade unions.

Staff in the sector are voting with their feet. They are leaving in droves. The vacancy rate is one of the highest in the economy and 130,000 jobs remain unfilled. Low pay is endemic. Over 400,000 adult care workers live below the real living wage, and 40% of the whole workforce live below the real living wage. A quarter are living on the verge of poverty and one-tenth are living with food insecurity. That is hardly a vote of confidence in our social care system.

Perhaps the most important reason for not delaying the action that is so desperately needed rests in the costs to our National Health Service. The latest State of Care report from the Care Quality Commission stated in April this year that waits for care home beds and home-based care accounted for almost half the delays in discharging patients who had been in hospital for more than 14 days. Nearly 4,000 people were delayed on an average day. The proposed fair pay agreement for adult social care staff has the potential to do so much good. Low pay, the lack of any career ladder and limited professional recognition are all inextricably linked in the social care sector. Experienced care workers with over five years’ service are paid, on average, just 8p an hour more than a new starter. There is little or no incentive for care workers to remain in the service; there is no meaningful career progression.

I cannot support the idea, which has been floated, that the new negotiating body would not apply to providers of care in the private sector. The whole point of the proposed fair pay agreement is that it will address low pay across the whole sector, not just those who are publicly funded. It would be deeply divisive, creating a two-tier care workforce with some benefiting and others shut out.

Privately funded providers should be requested to sit on the proposed adult social care negotiating body. We need that body to cover the whole sector, not just the public sector. If it is to work and to be successful in driving up pay standards across the whole sector, it must apply to the broadest definition of care workers. The proposed fair pay agreement is the first step towards a more structured pay system that over time should enable employers to offer a career pathway into social care, rather than low-status, low-paid employment with a high turnover rate.

So many of our citizens who need social care will benefit from the suggestions in this Bill. It is the first building block to a national care service. It will help with one of the most intractable problems facing our public services. The chief executive of the National Care Forum stated:

“We welcome any measures to strengthen the rights and improve the pay, terms and conditions of the social care workforce who make a significant contribution to our economy and the lives of millions of people”.


I ask that we allow this proposal, which will do so much good, to go forward, and that any amendments are no longer pursued.

[Lord Hunt of Wirral (Con)]

My Lords, I say at the outset what an important debate this has been. We on these Benches support fair pay, decent working conditions and recognition of the vital work that social care workers do. I join the noble Lord, Lord Palmer of Childs Hill, in his tributes, and welcome and thank all noble Lords for their contributions in this group. I want to say how pleased we all are that the noble Baroness, Lady Merron, has decided to come and deal with this issue, in a Bill for which she has no immediate responsibility but certainly does in the context of the social care negotiating body.

I had no part in deciding which group of amendments I would respond to, and I find myself in some difficulty, because the noble Lord, Lord Hendy, gave us the most brilliant exposition of the 126 years since the ILO was established in 1919 and the right to collective bargaining. However, in a way, that was directed not so much to the Minister but to his noble friend Lady Jones of Whitchurch, who, under the European Convention on Human Rights, signed to say that:

“In my view the provisions of the Employment Rights Bill are compatible with the Convention rights”.


Therefore, is it not the noble Baroness who should be responding to the tour de force that we received from the noble Lord, Lord Hendy? Perhaps she has already communicated to the noble Baroness, Lady Merron, what she would say in response.

We on these Benches cannot support a structure that hands over the steering wheel of national employment frameworks to a narrow group of trade union and employer representatives with little regard for broader public interest, service user experience or the realities of a publicly funded care system. By insisting that the chair be chosen exclusively by agreement between union officials and employer representatives, and in the event of disagreement by ACAS, these amendments would introduce unnecessary complexity and risk deadlock. By removing ministerial appointment, a crucial source of impartial leadership and accountability disappears. We cannot afford a negotiating body that stalls at the first sign of disagreement.

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[Lord Hunt of Wirral (Con)]

My Lords, we all owe a great debt of gratitude to the noble Lord, Lord Faulkner of Worcester, and my noble friend Lord Parkinson of Whitley Bay, for introducing a fascinating debate. My own relationship with heritage railways goes back some 45 years, to when I participated in all those wonderful railways in north Wales. I took my daughter Daisy to the top of Snowdon in one of these wonderful train rides. Sadly, the Western Mail had a picture of Daisy and me driving the locomotive, illegally, with the headline, “Daisy drives Dad around the bend”. I shall never forget that.

Therefore, like my noble friends Lady Neville-Rolfe and Lord Mendoza, the noble Earl, Lord Clancarty, and the noble Lord, Lord Palmer of Childs Hill, I approach this debate with some degree of positive expectation, because the noble Lord, Lord Katz, is going to reply. If ever there was anyone who would understand the need for this amendment, it is the noble Lord, Lord Katz. Whether his brief will allow him to show that level of understanding, we will have to wait and see.

This amendment brings welcome clarity and common sense to an area where outdated legislative definitions risk interfering with well-established and valued community practice. Heritage railways and tramways are not industrial undertakings in the conventional sense. They are, overwhelmingly, charitable or volunteer-led organisations dedicated to preserving history, offering educational experiences and engaging communities, often in rural or heritage-rich areas. This amendment recognises the important distinction between exploitive industrial labour and safe, structured, voluntary participation. Many young people who volunteer on heritage railways gain practical skills, develop a sense of responsibility and form connections across generations. It is, for many, their first taste of civic engagement and teamwork and is often a path into engineering, public service or the arts.

By inserting this narrow and well-defined exemption into the 1920 Act, this clause would ensure that young volunteers can continue to participate safely and legally in activities that benefit not only themselves but the broader public. Importantly, this does not in any way dilute protections against child labour or weaken employment law. It simply makes sure that our legal framework does not unintentionally penalise or prohibit what is clearly a public good.

[Lord Katz (Lab)]

My Lords, my reputation seems to precede me on this amendment. I am very grateful to my noble friend Lord Faulkner of Worcester for tabling Amendment 201 and have enjoyed a slight diversion in subject matter on the Employment Rights Bill. It is truly a pleasure to be able to continue the discussions that I have had with my noble friend Lord Faulkner about the railways for many years, both inside and outside this House. My noble friend is a true champion of heritage railways across the whole piece, not simply on this issue. I pay tribute to his role as president of the Heritage Railway Association.

It has been fantastic to hear from a number of noble Lords, including the noble Earl, Lord Clancarty, the noble Baroness, Lady Neville-Rolfe, and the noble Lords, Lord Mendoza and Lord Palmer of Childs Hill, all of whom extolled the virtues of heritage railways in providing a positive way of involving young people in transport, industry and civic engagement—as the noble Lord, Lord Hunt, was just saying—as well as contributing to the tourist sector and the Government’s mission for growth. The noble Lord, Lord Parkinson of Whitley Bay, spoke very strongly about that, and, as he pointed out, it is the 200th anniversary of the railway this year. We are doing a lot to commemorate that, and heritage railways will have their own role in that. I pay special thanks to the noble Lord, Lord Parkinson of Whitley Bay, for being the first person to out me as a rail nerd in this debate, and the noble Lord, Lord Hunt, also had that pleasure.

The noble Lord, Lord Parkinson, took us on a little tour d’horizon of the Private Member’s Bill debate we had in this House on this topic a few years ago, and mentioned a number of heritage railways. I can speak of the pleasure I had as a young child travelling on the Ruislip Lido railway, which was small in scale but mighty in reputation for those of us in north-west London. The noble Lord is right to point to the virtues of heritage railways, both as an economic activity and in individual engagement.

As a Government, we recognise and support the valuable opportunities young people have through volunteering to do a wide range of different work activities, including on heritage railways. Obviously, it is important that these things are carried out in a safe way, with employers, organisers and volunteers supervising activities to make sure that risks are properly controlled. To give some background, I will say that noble Lords will be aware that the Health and Safety Executive is responsible for regulating health and safety at work, but, in the case of the heritage railways, the Office of Rail and Road is the enforcing authority. Both these regulators have considered carefully what powers they have and how these would be applied in the case of young people aged between 14 and 16 volunteering on a heritage railway.

The Employment of Women, Young Persons, and Children Act 1920, which my noble friend Lord Faulkner of Worcester referred to, is a long-standing piece of legislation intended to prohibit the employment of children carrying out high-risk work, such as construction in industrial settings. To be honest, amending or repealing it would not be a straightforward matter.

The law protecting children in the UK is also a complex area, and this amendment touches on not only health and safety protections but other legislation and local authority by-laws. These are all devolved matters in Northern Ireland, and this amendment would impose changes there too. The 1920 Act is old legislation; amending it should be considered only after a thorough review of the impact on other areas of law, as there may be unintended consequences. It is worth pointing out that the primary legislation governing child employment, including light work, is the Children and Young Persons Act 1933. Amending or repealing the 1920 Act would still leave the 1933 Act in place, which—together with any by-laws made under it by local authorities—limits children to undertaking only light work. So repealing the 1920 Act could have unintended consequences across a number of sectors, and a full impact assessment would be required.

As we have heard, modern health and safety legislation does not prevent children and young people volunteering on heritage railways. I was pleased that my noble friend Lord Faulkner of Worcester referred to the Heritage Railway Association survey, which demonstrated that there are around 800 under 16 year-olds volunteering on heritage railways across the country. There may be activities that are unsuitable for young volunteers to carry out—for example, safety-critical tasks such as train diving—but I am pleased to say that both regulators are very willing to work with the Heritage Railway Association, as we have heard from my noble friend Lord Faulkner of Worcester, to determine what sorts of activities would be safe, appropriate and suitable for young volunteers aged 14 to 16 to perform on the railways.

Of course, regulators should, and do, take a proportionate approach to enforcement action. It is worth noting that the last time the 1920 Act was used to support health and safety enforcement was in 2009. As my noble friend Lord Faulkner of Worcester told us, there have been no prosecutions under the 1920 Act, either of public bodies or private individuals, which proves that the status quo is not absolutely terrible.

The aim of this amendment is to remove any barriers to allow children to gain valuable experience volunteering on heritage railways and tramways. Nobody wants to see more young men and women developing an interest and, indeed, a career on the railway more than I do. It is not clear that there is an overwhelming amount of evidence that this legislation is creating any barriers and, as we know, many heritage railways run very successfully with young people volunteering in a wide range of activities to support those ventures.

Both the Office of Rail and Road and the Health and Safety Executive remain very willing to work with the Heritage Railway Association to develop additional guidance and, possibly, examples of good practice to ensure that young volunteers can continue to work safely in heritage railway settings. While this is a sensible and proportionate way forward to address this issue, I have heard the strength of opinion on this matter from across the Committee. I am more than happy and willing to facilitate a meeting with my noble friend Lord Faulkner of Worcester—other noble Lords may be interested—with the HRA, DfT, ORR and HSE to further pursue this issue. Without making any further commitments, I therefore ask my noble friend to withdraw this amendment for now.

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[Baroness McIntosh of Hudnall (Lab)]

My Lords, I had not expected to speak at any point during this Bill, and I will do so now only very briefly to express my thanks to the noble Earl and his colleagues for praying my name in aid in relation to this amendment. I really just want to say that I may be the only person in the House—and I am certainly, I think, the only person in this Chamber—for whom a casting directory was the bible of my life for many decades. Therefore, I know exactly how important it is to performers that there should be a trusted published work of some kind to which they can refer their information which can then be the source of potential employment through the work of casting directors and other industry professionals.

I just say to the Minister, when she comes to consider this amendment—which, by the way, I do support, and I have nothing to add or anything I wish to contradict in what has been said so far—that it is important to recognise that this is an extremely delicate ecosystem in which there are many, many people who need to avail themselves, and have done over decades, as we have been told, of the kind of service that a casting director and a casting directory provide. Frankly, for most of all of our lives, it has been Spotlight, but it could be others. The people who need to avail themselves of that service are many in number, and the people who need to use it in order to find out about those people are much fewer in number—mostly casting directors. It is very important that they have a trusted source, that performers can rely on their information being carefully curated, looked after and protected in the way that the noble Earl and the noble Lord, Lord Freyberg, have already outlined, but that we do not disturb the particular delicate relationship between those two aspects of the way that the business works. While I am not in favour of exceptionalism on the whole, I think we do have to understand that this industry operates not always perfectly but certainly in an unusual kind of way, and it is necessary that it continue to do so with the right protections in place.

[Lord Hunt of Wirral (Con)]

My Lords, we are very grateful to the noble Earl, Lord Clancarty, the noble Lords, Lord Freyberg and Lord Hendy, and the noble Baroness, Lady McIntosh of Hudnall, for bringing this very important subject to the attention of this Committee. All sectors of the economy, including the creative industries, deserve fair and proportionate attention in the development and review of employment law, particularly when, as the noble Earl pointed out, the workplace is changing so fast and at such speed.

As the noble Earl reminded us, we need a framework which strikes the right balance. We are all grateful to him for not commenting in any detail about an ongoing dispute, which we will all carefully avoid mentioning any more, although we all agree we must keep a watching brief on what is happening as regards that particular instance.

However, as we consider wider reforms to employment rights and protections, we must ensure that we are not unintentionally leaving out those in less conventional work arrangements. Performers and others working in the creative industries often operate outside the normal employer and employee model. They frequently rely, as we have heard, on casting directories and digital platforms to access work—platforms that are increasingly central as to how creative labour is bought and sold, and have been for a number of years. Yet this part of the labour market is rarely the focus of legislative scrutiny. That must change.

I hope we are all agreed that we cannot claim to be modernising employment law if we ignore how it interacts with one of the fastest growing and culturally significant sectors of our economy. This amendment does not, of course, call for regulation but for understanding. A review will help us grasp better whether existing protections are functioning as they should, and whether any further action is needed to ensure fairness and transparency in the systems on which performers so clearly depend. I look forward to hearing from the Minister as to how he would like to respond to what is a fast-changing situation.

[Lord in Waiting/Government Whip (Lord Leong) (Lab)]

My Lords, I thank all noble Lords who have contributed to this very short but very interesting debate, and declare an interest that many and perhaps all my actor friends are registered with Spotlight. I take this opportunity to thank the noble Earl, Lord Clancarty, and the noble Lord, Lord Freyberg, for tabling Amendment 204C.

Providers of work-finding services, which can include digital services, are regulated through the Conduct of Employment Agencies and Employment Businesses Regulations 2003, which are enforced by the Employment Agency Standards Inspectorate, and in due course they will be enforced by the fair work agency. I hope that answers the question of the noble Lord, Lord Freyberg, on who enforces regulations in this area.

The conduct regulations also allow for employment agencies to charge work-seekers in specific occupations, such as actors, musicians and singers, fees for their inclusion in a publication for the purpose of work finding. These costs can be no more than a reasonable estimate of the cost of production and circulation of that publication.

I am sure that all noble Lords will appreciate that I cannot say anything more about the ongoing litigation between the actors’ union and that particular organisation. However, I will share with all noble Lords how the Government are supporting the creative sector.

The UK is home to world-class creative industries. Every single day, our arts and culture bring joy to millions of people, not just in our four nations but all over the world. Every second, someone somewhere will be listening, reading or hearing one of our creative artists. They are part of our soft power, part of our economic power and part of the joy that we so generously give the world. They enrich our lives, bring our communities together and drive our economy. The creative industries have been identified as a growth-driving sector in our strategy, Invest 2035.

People and skills are an important part of this strategy. The Government have been working closely with the sector, including through the creative industry sector plan task force, to develop a plan for the sector. The Creative Industries Taskforce includes Creative UK, the British Fashion Council and the Royal Shakespeare Company, and I hope that it will address some of the issues that were asked about earlier by the noble Lord, Lord Freyberg. I appreciate the noble Lord’s efforts to improve the working conditions of those in the creative industries, and I will discuss this further when we debate a later amendment on the performing arts and entertainment sectors tabled by the noble Lord, Lord Freyberg.

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[Baroness Jones of Whitchurch (Lab)]

I make my case. The only reason those interest rates were cut was that our economy has been improving. Some £63 billion of private investment was announced at the investment summit last year. Introducing this Bill within 100 days will boost protections and quality of work for the lowest-paid, raising living standards across the country and creating opportunities for all.

I turn to the actual amendments. Amendments 205 and 207, in the name of the noble Baroness, Lady Noakes, would introduce exemptions to this measure based on the size of the business. The new duty on employers to inform all employees of the right to join a union is a key part of the Government’s wider commitment to strengthen workers’ voices in the workplace, enhancing their representation and ultimately improving working conditions through increased trade union membership and participation. Making exemptions of this kind risks creating a two-tier system in which some workers benefit from this important information while others do not, based purely on the size of their employer. We are committed to striking a fair and proportionate balance, ensuring that workers are aware of their rights without placing undue burdens on employers.

The statement will be provided at the start of employment, alongside the written statement of particulars, which employers are already required to give under Section 1 of the Employment Rights Act 1996 and on a prescribed basis. Therefore, I say to the noble Lord, Lord Jackson, that we do not believe that this is a particularly significant extra burden to justify exempting certain employers because of their size, because they already have to give that information anyway.

The noble Baroness, Lady Coffey, and others asked about the frequency. We will consult on the specific details, such as the frequency, manner, form and content of the statement before it is outlined in secondary legislation, and I can let noble Lords know that that will be via the negative procedure. We will particularly encourage input from both businesses and unions of all sizes to share their views.

[Lord Hunt of Wirral (Con)]

The Minister just referred to the negative procedure. Is that a final decision? Given that the Bill takes so much power to make a series of important decisions by statutory instrument, I think the general expectation would be that such an important decision would be made by affirmative resolution. Would she perhaps contemplate whether that might be the better solution?

[Baroness Jones of Whitchurch (Lab)]

I thank the noble Lord for that introduction, because I was going to go on to say that the Government think that the powers taken in Clause 55 are necessary and proportionate. Indeed, the Delegated Powers Committee said that

“it is heartening that in a Bill with so many delegated powers”

it had

“only found four on which to raise concerns”.

Clause 55 was not one of those four, and we will of course respond to the committee’s recommendations in due course.

[Lord Hunt of Wirral (Con)]

While we are considering what the Delegated Powers and Regulatory Reform Committee concluded, I recall that the last time I raised the use of the Henry VIII powers, the Minister said that this Committee would see her draft implementation plan, to which my noble friend referred just a short time ago. We have not yet seen that plan, and a lot of businesses are very concerned about the uncertainty that is being created by not knowing, certainly by now, when these various powers are going to be brought into effect. Will she give some timescale by which we will see the implementation plan, if only in draft?

[Baroness Jones of Whitchurch (Lab)]

I know we have discussed the implementation plan several times now, and I can assure noble Lords that we are working at pace to finalise that. I do not think it would be helpful to see it in draft or imperfect form. We want people to have a categorical road map which shows the way forward. We absolutely understand that businesses need to see that; we are working on it. I am very confident that when businesses see it, they will be reassured that none of the things that we are proposing in this legislation will be rushed through. They will have time to prepare for it—I think we had a debate about this earlier. We know that businesses need time to prepare, we are absolutely aware of that, and we are going to make sure that they have it.

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Moved by

[Lord Hunt of Wirral]

208A: Clause 56, page 74, line 34, leave out “or communicate with workers (or both)”
Member's explanatory statement
This amendment to section 70ZA(2)(a) removes the reference to union officials being able to “communicate with workers” as part of an access agreement.

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[Lord Hunt of Wirral (Con)]

My Lords, I rise to speak to Amendments 208A, 209A, 210, 210A, 213A and 213B, standing in my name. Those first amendments remove the reference to communication with workers as an element of access agreements between unions and employers. They further remove provisions that attempt to cement that right to communicate by any and all means, and which prohibit a party from relying on the availability of physical or non-physical communication as a reason to limit the other. Taken together, these provisions amount to a significant and unjustified broadening of what has traditionally been a clearly understood and workable arrangement: namely, the right of union officials physically to enter a workplace for legitimate access purposes.

This access, by its nature, has always been specific, scheduled and carried out in a manner agreed upon by both parties. It is bounded in both scope and form. The Bill as drafted risks blurring those lines in ways that introduce legal ambiguity, managerial uncertainty and operational disruption. The reference to communication

“by any means, whether directly or indirectly”

is particularly concerning. This is an extremely wide formulation that is open-ended in both language and intent. It creates uncertainty not just in principle, but in practice. What exactly does indirect communication mean in the context of an access agreement? Does it encompass digital platforms, printed material, third-party intermediaries, or perhaps the passive dissemination of content in workplace systems? Without clear boundaries, employers will be left navigating uncharted waters, unsure of what they are obliged to permit and what may lawfully be resisted.

We must also think about how such broad phrasing sits alongside an employer’s duty to maintain a safe, orderly and productive working environment. Workplaces are complex ecosystems. They are governed by routines, procedures and, crucially, the employer’s ability to direct the operation of their business. If union officials are granted sweeping rights to communicate “by any means”, without the tether of physical presence and supervision, there is a genuine risk that communications will occur in ways that distract, disrupt or even divide—not necessarily through bad faith, but a lack of structure.

Equally problematic are the provisions that state that physical entry to a workplace should not be refused simply because non-physical means of communication exist, and vice versa. These clauses, while perhaps intended to protect flexibility, in fact remove the very discretion that employers must retain in managing their own premises. They suggest that the availability of one channel of communication can never justify the refusal of another, regardless of context. Surely that is both inflexible and unrealistic.

There may be very good practical reasons for an employer to prefer one form of engagement over another; a highly secure site may welcome scheduled, in-person access, but find unsolicited, off-site communications disruptive or invasive. A remote or hybrid workforce may prefer written updates to physical visits. By attempting to lock in symmetrical rights to both physical and non-physical communication, the Bill as drafted risks creating conflict where co-operation is needed and rigidity where discretion would be more effective.

Moreover, we should not lose sight of the fact that union engagement can and does occur outside the framework of statutory access agreements. The purpose of this legislation is not to create an open-ended entitlement for unions to interact with workers in any manner they choose; it is to provide a draft legal mechanism for arranging workplace access for legitimate purposes—access that must be reasonable, structured and proportionate. That mechanism surely must not become a Trojan horse for a much broader intervention in the management of communications within private enterprises.

The cumulative effect of these provisions, if left unamended, would be to tilt the balance too far, away from the well-established equilibrium between union representation and employer control. They would introduce legal uncertainty, operational disruption and potential privacy concerns, all under the banner of modernising union access.

It is vital that we place Amendment 210 in the proper context. The idea that unions could gain access to employers’ digital platforms, including internal communication systems, company email servers and private digital infrastructure, was not part of the original Bill but was added by the Government in the other House only on Report, with minimal explanation and no real opportunity for detailed parliamentary scrutiny. That is simply not acceptable.

This House is now the first truly to consider the full implications of what would, without question, be a major expansion of union access rights into employers’ private and operational space—not their physical space, but their digital infrastructure which is, in many ways, just as sensitive, just as regulated and potentially far more vulnerable. I believe that we must take our scrutiny role very seriously and that this House must now do what the other House was denied the opportunity to do: we have to probe this new power fully and openly.

We are now confronted with a proposal that, for the first time ever, would allow trade unions to reach employees via internal platforms such as company intranets, corporate email systems, Zoom, Microsoft Teams and other work-based communication tools, many of which are governed by strict internal policies, compliance frameworks and even sectoral security requirements.

This is not a theoretical concern. The Bill now provides a broad enabling power, with the detail to be filled in later through secondary legislation. We do not yet know which platforms will be in scope, how frequently unions will be permitted to post or engage, or what rights employers will have to review, edit or even be informed of the content beforehand. We are being asked to legislate on the basis of a skeleton—a blank cheque—with the flesh to be added later by statutory instrument, and that is precisely when parliamentary control is at its weakest. It is in secondary legislation where the balance of scrutiny too often shifts from robust parliamentary debate to rubber-stamping.

So what are we really dealing with here? Employers will, under the current drafting, be expected to engage constructively with union requests for digital access and will be given as little as five working days to respond. This is not merely hypothetical; this is a system designed to operate particularly in workplaces where physical access may be difficult or impossible—for example, remote teams, field-based staff and distributed or digital-first organisations. This may sound practical in theory, but it raises serious unresolved operational questions in practice. Who controls the messaging? Who controls the content? Who approves it? Can unions directly upload material on to a company’s internal platforms, or is it the employer’s responsibility to upload union-drafted content? In that case, does the employer have the right to make edits or raise objections? Can the material be branded? Must it be neutral? Will it sit alongside or appear to compete with official communications from HR or leadership teams?

So will the Government publish guidance? If so, when? At the moment, we just do not know the answers to any of these questions. These are not small matters; they are foundational issues of governance, internal messaging and even risk. For some employers, particularly in finance, defence and data-sensitive sectors, internal systems are subject to strict regulation and security controls. Can they allow access to these platforms without compromising legal obligations? In some cases, they may not be able to grant access, even if they wish to, and in others they may face exposure to reputational or compliance risks if improper messaging is circulated without oversight.

We must also consider the precedent being set. Allowing third-party organisations, however well-intentioned, to access digital systems designed for internal business-related purposes represents a significant departure from current practice. The potential for confusion, conflicting messaging and unintended consequences is high. This should not be rushed through under cover of secondary legislation.

For all those reasons, the amendment before us is entirely justified. It places a necessary brake on an overreach that has not been debated or examined and certainly not consented to by both Houses. If the Government believe that digital access is necessary and can be sensibly and safely managed, then let them bring forward a fully detailed proposal in the proper way. Let us have the opportunity to debate that openly, with all the facts in front of us—not as an afterthought or implication and certainly not as a quietly drafted regulation.

I therefore strongly urge your Lordships to support this amendment. Let us draw a clear line around what “access” means in this legislation and what it does not. If Parliament is to grant new powers, it must scrutinise them fully, which is what this Chamber is supposed to do.

I turn to Amendment 213B, which goes directly to the operational realities of the modern workplace—the way in which access is exercised, whether it involves scheduled meetings, ad hoc visits, group briefings or one-on-one discussions. That all can have a substantial effect on day-to-day operations. The frequency and timing of those visits matter enormously. Daily interruptions at peak hours are not the same as occasional meetings during quieter periods. Repeated unfocused access can, however unintentionally, become disruptive, particularly in sectors where workflow depends on concentration, safety procedures or continuous operations.

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[Lord Katz (Lab)]

I am very happy to write. I resist the idea that I am not being candid here. The noble Baroness may not like what I am saying, but the point stands. I am of course very happy to write to her and to the noble Lord, Lord Leigh of Hurley, with more detail.

In conclusion, we expect that, in many cases, employers and trade unions will be able to agree the terms on which access takes place, including for digital access. In the event that there is no agreement, the CAC can impose terms, including terms dealing with digital access. I repeat: the precise details of how this will work in practice will be set out in secondary legislation following further consultation. I therefore ask that Amendment 208A be withdrawn and that noble Lords do not press their other amendments.

[Lord Hunt of Wirral (Con)]

My Lords, first, I say to the House authorities that we greatly appreciate the way they have tolerated the fact that we have gone way beyond the normal rising time on a Thursday, particularly as we are sitting tomorrow at 10 am. In mitigation, I note that we have tried to truncate what is a hugely important group of amendments. There are many things that we would want to probe further, so we will have to return to this on Report.

I thank my noble friends Lord Jackson of Peterborough, Lady Lawlor, Lord Leigh of Hurley and Lady Coffey for their contributions. I was interested, as always, to hear the noble Lord, Lord Hendy, and the noble Baroness, Lady O’Grady, although I hope that she will mitigate the damage she may have done with her remarks about one of the biggest investors in the UK, Amazon.

[Baroness Bousted (Lab)]

This is the second time the noble Lord has taken on my noble friend Lady O’Grady, who made perfectly reasonable comments. I do not think it is a good idea to be patronising in the House.

[Lord Hunt of Wirral (Con)]

I am sorry about that discordant note, introduced into what has been a really useful day in Committee on this important Bill.

I hope that people outside will realise that we have been debating a group of amendments that were made at the last moment in the House of Commons. They have not had any scrutiny at all in Committee in the Commons. That is why this House has so much responsibility to ensure that, in a fast-moving digital world, we do not transgress in a way that places employers and employees in an impossible position.

I thank the noble Lord, Lord Goddard of Stockport. He asked some direct questions, but we have not yet had the answers to them. It may well be that the Minister will write generally to us all to respond to the points he did not have time to answer today. I appreciate that he has limited time too, but he might like to respond in writing to us all, covering the points that he has not yet been able to deal with.

[Lord Katz (Lab)]

I am very happy to write, particularly to the noble Lord, Lord Goddard.

[Lord Hunt of Wirral (Con)]

On that positive note, I beg leave to withdraw the amendment.

Amendment 208A withdrawn.

Employment Rights Bill

Lord Hunt of Wirral Excerpts

Committee stage
Tuesday 10th June 2025 Lords Chamber

Moved by

[Lord Hunt of Wirral]

215: After Clause 56, insert the following new Clause—
“Right to switch off in relation to trade union representatives(1) The Trade Union and Labour Relations (Consolidation) Act 1992 is amended in accordance with subsection (2).(2) After section 69 (right to terminate membership of trade union), insert— “69A Right to switch off in relation to trade union representativesIn every contract of membership of a trade union, whether made before or after the coming into force of this section, a term conferring a right on the member to refuse to monitor, read or respond to contact (or attempted contact) by a trade union representative outside their working hours shall be implied.””Member’s explanatory statement
This new clause confers a right to switch off on trade union members in relation to contact from trade union representatives.

[Lord Hunt of Wirral (Con)]

My Lords, Amendments 215 and 332 are in my name and that of my noble friend Lord Sharpe of Epsom. They insert a right for trade union members to switch off—to ignore contact from union representatives outside their own working hours.

Let me be clear at the outset that we on these Benches do not see this as an unimportant, “nice to have” option. It is a necessary safeguard in the context of a Bill which is probably doing more than any legislation in living memory to grant privileges to trade unions and inflate union power and will encourage aggressive recruitment regardless of whether or not workers want it. This amendment goes to the very heart of a deeper question we have to ask ourselves: whom is the trade union there to serve—the worker or itself? If we are honest, the Bill increasingly seems more interested in empowering the institution than protecting the individual. The Bill certainly tilts the playing field, not towards workers as individuals but towards union structures as institutions, and it does so with no meaningful safeguards, no checks and balances, and no regard for the fact that many workers today want something very different from what the traditional trade union model is capable of offering.

The Bill is not neutral nor balanced, and it is not simply updating outdated frameworks or modernising collective bargaining: I believe it is a deliberate attempt to revive old-school trade unionism in a dramatically changed industrial context by granting unions not legitimate rights but privileges, whether or not the workers want them. Through expanded access rights, new entitlements and a raft of concessions, the Government are artificially breathing life into organisations that are, frankly, no longer representative of most working people. Union membership has been declining for decades, not because of external barriers but, I believe, because of internal obsolescence. The nature of work has changed, and expectations have changed, yet trade unions have not. Instead of accepting that reality, this Government have decided to push unions back into the workplace, not by making them more attractive but by giving them more power. We know what happens when institutions are given power without accountability: they use it and, often, abuse it.

This amendment is therefore a response to that risk. It says clearly and unapologetically that, even if the Government want to empower unions, individual workers should still be able to set boundaries, especially in their own time. The pressure that comes from union representatives is not always welcome, and it is certainly not always proportionate, especially now that, under the new powers granted by the Bill, I am sure we will see a rise in out-of-hours messaging, campaign pushes, late-night emails, WhatsApp group bombardments, friendly reminders to attend meetings or urgent invitations to back a ballot. It will be relentless, not because it has to be but because unions will be under pressure themselves to prove their relevance, grow their numbers and mobilise more quickly and visibly than ever.

The burden of that spurious urgency will fall squarely on the ordinary—often reluctant—member, who will have joined the union for protection, not politics, and who just wants to do their job and get on with their life. That member deserves a basic right: the right to draw a line. This amendment gives them that right. It says that, outside your working hours, you cannot be expected to respond to union communications, not because you are hostile to unions or are trying to undermine solidarity but because your time is your own—and because respect for the individual must come before deference to the organisation.

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[Lord in Waiting/Government Whip (Lord Leong) (Lab)]

My Lords, I first thank the noble Lord, Lord Goddard, for his very entertaining contribution, and the noble Lord, Lord Hunt of Wirral, for speaking to Amendments 215 and 332 in his name and that of the noble Lord, Lord Sharpe.

The proposed new clauses would create a right in primary legislation for trade union members to switch off from contact from trade union representatives. As far as I am aware, there is not any demand to introduce such a requirement on trade unions. I have not heard this from my colleagues, or from trade union members, or from any worker, or indeed from any employer or employer organisation that I have spoken to lately.

It is difficult to see what benefit or purpose such an obligation inserted into membership contracts might serve. Currently, there is no obligation for a trade union member to reply to communications from their trade union, as was ably set out by the noble Lord, Lord Goddard. There is nothing stopping a member ignoring them or telling them to **** off.

This Government are committed to the well-being and positive work-life balance of all workers. The Employment Rights Bill is proof of this commitment, with relevant measures including making flexible working the default except where not reasonably feasible. This will help employees and employers to agree solutions which work for both parties.

I say politely to the noble Lord, Lord Hunt, that I reject his allegation of trade union influence and power interfering with people’s lives. As it stands, every member can ignore the messages and communications —whoever has approached them—outside work. There is no evidence that this is currently happening. I ask the noble Lord, Lord Hunt, to reflect on that and to be careful with some of the pretty harsh words he has said. I invite him to withdraw his Amendment 215.

[Lord Hunt of Wirral (Con)]

My Lords, the noble Lord has to face the reality of the situation when looking at today’s world, where trade unions represent only 12% of private sector workers. He tells the Committee that this provision is not necessary now, but we are entering a new era. It is one that I recall vividly, when I first came into the House of Commons, just under 50 years ago, at a time when the trade unions dominated lives to a huge extent. Talking to some of my friends in the trade union movement, I sense that they look forward to the day when the trade unions will re-emerge in the private sector and become again dominant in public life.

I too was very grateful to the noble Lord, Lord Goddard of Stockport, for talking about work-life balance. I am rather sad that the noble Lord in responding did not really get into that. That is what this amendment is all about. In sharing with us his experiences in the GMB, the noble Lord, Lord Goddard of Stockport, put it in context. I have, in the past, done a lot of cases for the GMB; it is a wonderful, friendly society that looks after people in a huge way. This amendment is not ideological, it is not radical and it would not weaken unions. It would not restrict collective bargaining or impose new administrative burdens on trade unions. All it and the subsequent amendment seek to do is to offer trade union members the right—the dignity—to say, “Not now. Not after hours. Not in my living room. Not when I am at home, off duty and seeking the same privacy and peace of mind that every working person deserves”. We are looking forward to that day, or are we?

If these new provisions give additional power to unions in the Bill, why do the Government not stop for a moment to ask how this will affect ordinary members? Not union leaders, not officials, not full-time organisers, but the actual members who just want to get on with their lives, in peace. That is what this amendment is about—not disruption, not dilution, but balance. I fully accept that many of these members will not complain about out-of-hours contact from a union, but not because they agree with it but because almost certainly they will be tired and will not want confrontation, as they worry that pushing back could lead to exclusion, being labelled or being isolated within the very structure that they joined for protection.

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Leaving out Clause 57 would allow SMEs to continue to have an opt out from the compulsory duty to recognise a trade union irrespective of the number of employees working for the SME.

[Lord Hunt of Wirral (Con)]

My Lords, I will speak to the opposition to Clause 57 standing part of the Bill and to Schedule 6 being agreed, tabled by my noble friend Lord Jackson of Peterborough. I also support Amendment 215AZA to Schedule 6, which proposes inserting

“other than in the usual course of the employer’s business”

after “units”. This is all part of a much wider debate that we are moving towards on trade union access and recognition. The amendment may appear narrow in scope, but it addresses a serious flaw in the current drafting which could lead to unintended consequences that undermine the objectives of the Bill and the practical realities of the modern workplace.

The purpose of the provision as drafted is to prevent employers undermining trade union recognition by artificially inflating the size of a bargaining unit with new employees after the application day. That objective is entirely sound. Employers should not be able to frustrate or delay the process of recognition by manipulating the workforce in bad faith. While the provision seeks to target such behaviour, however, the current wording does so in a way that ignores the economic and operational realities facing most employers.

In the vast majority of businesses, employees join and leave as a matter of course. Recruitment is not a manipulative tactic—it is a normal, often essential part of running an organisation. Particularly in sectors with high turnover, employers must routinely recruit to maintain service levels, respond to demand or support business growth. But under the schedule as currently worded, any new employee who joins the bargaining unit after the application date may automatically be excluded from consideration, regardless of whether that recruitment was completely ordinary and unconnected to the union process.

This risks creating a perverse incentive for employers to delay or freeze hiring during the recognition process—something that may last nine months or more in practice. Employers would be put in an impossible position: either pause recruitment at significant operational and economic cost, or continue recruiting and face the uncertainty of whether those employees count in the CAC’s consideration. It also risks unjustly penalising new employees, who, through no fault of their own, would be deprived of representation in the collective bargaining process simply because of the timing of their hire.

This kind of rigidity does not reflect how businesses operate or how workforces evolve. The schedule, without amendment, assumes a static picture of the workplace—one frozen at the moment of application. That may make theoretical sense in a static model, but in reality it is artificial and unworkable. In doing so, it creates uncertainty for all parties and opens the door to protracted disputes about who should or should not be included in a bargaining unit.

Furthermore, the Central Arbitration Committee is already well equipped to monitor changes in workforce composition. It regularly requires updates to information throughout the recognition process. Employers and unions alike are accustomed to this and operate within it. The idea that including new, routinely hired employees in a bargaining unit would overwhelm or undermine the CAC process is not supported by the CAC’s own established practice. The amendment, therefore, does not introduce an undue burden; it aligns the legislation with how recognition procedures already work in practice.

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[Baroness Jones of Whitchurch (Lab)]

These amendments seek to delay when unions would be able to request access during the recognition process until after the bargaining unit had been agreed or determined. While I understand what the noble Lord is attempting to achieve with these amendments, employers have access to the workforce throughout the recognition process. The Government’s view is that unions should have access to the workplace as well from the point where the CAC accepts the application for recognition. This enables the unions to also have access to the workplace for a time closer to the start of the recognition process.

Amendments 215FG, 215FH, 216GA and 216MA seek to remove specific unfair practices from Schedule 6. They seem to seek to allow employers or unions to make an outcome-specific offer or use undue influence with a view to influencing the recognition application. These unfair practices are of long standing and are already set out in the legislation currently in force. The use of undue influence could, for example, include the threat or the use of violence. We therefore see no argument for removing these prohibitions on these unfair practices.

Amendment 216 seeks to reverse changes in the Bill by reinstating the requirement that unions meet the 40% support threshold in addition to a majority in a statutory union recognition ballot. I remind noble Lords that this was a manifesto commitment set out clearly in our plan to make work pay. We are committed to strengthening collective bargaining rights and trade union recognition. We believe that strong trade unions are essential for tackling insecurity, inequality, discrimination, enforcement and low pay. Our view is that the existing legal framework needs to be simplified so that workers have a more meaningful right to organise through their trade unions.

To achieve this, we are removing the current requirement for a union to have at least 40% of the workforce in the proposed bargaining unit supporting union recognition. In future, unions will need only a simple majority in a recognition ballot to win. We believe that the 40% support threshold represents too high a hurdle in modern workplaces, which are increasingly fragmented.

Amendment 216KA seeks to ensure that an employer is not prohibited from taking action against the worker for meeting or indicating that they would like to meet unions during the statutory recognition process if the worker has breached any term of their contract of employment. The prohibition that this amendment seeks to amend is carried forward from the existing legislation, where the proposed proviso about the worker not having breached their contract does not appear. While well intentioned, this amendment is not necessary. The prohibition applies only where the employer takes action against the worker solely or mainly on the grounds that they met with the union. It does not apply where the sole or main purpose is another reason, which may, in some circumstances, be a breach of their contract of employment. I hope this provides the necessary reassurance to the noble Lord.

I therefore thank the noble Lords, Lord Sharpe and Lord Hunt, for the debate and for tabling these amendments, but I must ask the noble Lord not to move the amendments.

[Lord Hunt of Wirral (Con)]

My Lords, we are very grateful to the Minister for revealing to the Committee that we are discussing a fundamental reshaping of workplace democracy, with potentially profound consequences. She is right to explain that that is what the Government are about. The Employment Rights Bill does not just tinker with existing procedures; it carefully dismantles the framework established by previous Labour Governments. Under these reforms, as the Minister just revealed, unions would need to demonstrate just 10% membership support to trigger recognition processes, and that is a threshold that regulations could reduce, after consultation, to an extraordinary 2%.

Let me explain to the Committee what that means in practice. In a bargaining unit of 250 employees, recognition could be initiated by as few as 25 members under the 10% threshold, or potentially just five members if it is reduced to 2%. More troubling still, with the removal of the 40% support requirement, union recognition, granting negotiating rights over all 250 employees, could theoretically be achieved with a single yes vote, provided no one votes against. This is not hyperbole but mathematical reality under the proposed framework.

Perhaps most concerning of all is that, as the Minister, Justin Madders, acknowledged in the other place, there has been no consultation on these fundamental changes. We are being asked to revolutionise industrial relations based on ideology rather than evidence, without hearing from employers, workers or even the Central Arbitration Committee, which must implement these provisions. This lack of consultation betrays a troubling disregard for the complexity of workplace relations and the legitimate interests of all parties: employers, workers who support unionisation, and those who do not.

The amendments I spoke to are not anti-union but pro-democracy. They recognise that legitimate collective bargaining must rest on genuine demonstrable support from the workforce it claims to represent. The current proposals risk creating what I can only describe as recognition by stealth, where small, motivated groups can impose collective bargaining arrangements on entire workforces without meaningful mandate. That is not industrial democracy; it is the antithesis of it.

Consider the worker who joins a company the day after a union application is filed. Under these proposals, they may be excluded from the very process that will determine their workplace representation. Consider the 245 employees in my hypothetical bargaining unit who never joined the union and never voted, yet find themselves bound by collective agreements negotiated on their behalf by representatives they did not choose.

Beyond democratic concerns lie practical ones: the amendments I have tried to persuade the House to accept recognise that businesses must continue to operate during recognition processes that could stretch over nine months. Routine recruitment, staff transfers and ordinary business activities cannot be frozen pending union ballots without severe economic consequences. Yet the Bill as drafted forces exactly this choice: suspend normal operations or face the uncertainty of having legitimate business decisions treated as manipulation.

These reforms occur within a pattern of changes that consistently favour union interests over balanced workplace relations. The lowering of thresholds, the removal of safeguards and the expansion of access rights: each individual change may seem modest, but collectively they represent a fundamental shift in the balance of industrial relations. This is particularly concerning given the Government’s stated commitment to economic growth. How can we simultaneously demand that businesses expand, hire and invest while making their operations subject to collective bargaining arrangements that will lack genuine workforce support? The Government must bear in mind that these Benches will not sit back and allow this to happen. We will return to it at Report, but in the meantime, I will not oppose the clause standing part.

Clause 57 agreed.

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[Lord Goddard of Stockport (LD)]

My Lords, I will be extremely brief, as the dinner hour is upon us and there are—as we say—strangers in the House.

While I recognise the importance of transparency to inform members’ choice regarding funds, this group of amendments raises serious questions about proportionality. Amendments 216YC and 216YD would introduce notably higher thresholds for political resolutions, requiring support from a majority of all eligible members, rather than just those voting, and mandating new resolutions every five years. These are significant changes from the current practice. Likewise, Amendments 221 and 223—expertly explained by the noble Lord, Lord Burns—seek to reduce opt-out notices from 10 years to one or two.

While the intention behind these proposals is clear, the impact warrants careful consideration. Other issues have been slightly sidetracked. There are fundamental issues that I would like the Minister to address head-on. These issues are at the nub of trade unions and political funds, so we need some clarity on them from the Dispatch Box.

[Lord Hunt of Wirral (Con)]

My Lords, what an important debate this has been. I think 14 noble Lords have participated, starting with my noble friend Lady Coffey. She dealt with Clause 58 in particular, whereas most of the rest of the debate has been around Clause 59.

I am very grateful to the noble Lord, Lord Burns. His speech dominated the debate, as he set out so clearly the history of what he described as the 2016 compromise—which in fact it was—that Clause 59 now seeks to overturn. I accept the points made by the noble Lord, Lord Prentis of Leeds, about the importance of campaigning and seeing full participation in that area. I am also very grateful to my noble friend Lady Finn for coming specially on her birthday to remind us all of the role she played on the Burns committee. Despite interruptions, she got across a series of key points about that compromise. Those who were interrupting her did not seem to realise that shareholders have to approve any political donations made by companies—but never mind.

I move on quickly to the noble Baroness, Lady Fox of Buckley, and my noble friends Lord Jackson of Peterborough and Lady Cash, who had a fascinating exchange with the noble Lord, Lord Hendy. I have to say to the noble Lord, Lord Hendy, speaking now as a practising lawyer, that my noble friend Lady Cash is right: if money is taken for any period without knowledge or consent, freedom of association has been removed—it does not matter whether it is for a week, a month or a decade. In a way, though, that was a side issue.

The noble Lord, Lord Monks, then took us way back in time. We all always benefit from the noble Lord, Lord Monks. I still have the guilty feeling that I caused a cartoon to be shown in the Guardian showing him getting into bed with me, in which his was the face on a huge cart horse. I was Secretary of State for Employment, and I was being accused by the Guardian of being too nice to the trade union movement by getting into bed with the noble Lord, Lord Monks—but we are not in the same bed tonight.

We heard from my noble friend Lord Johnson of Lainston, who really put the record straight and elevated the sort of smears that were thrown—usually from a sedentary position—from the party opposite in that context. My noble friends Lord Leigh and Lady Lawlor did the same. I thank the noble Lord, Lord Goddard of Stockport, for really trying to encapsulate what has been a very complicated and detailed debate.

Let us be clear on one thing—and it is up to the Minister to respond to all the very valid points that have been raised: Clause 59 says that workers will be presumed to consent to union political contributions unless they actively opt out. This is a fundamental shift. It reverses the presumption of consent in a way that would never be tolerated were it an employer imposing such terms on a worker. Where, then, is the Government’s concern for free choice, transparency and the dignity of the individual to act without coercion? Surely, if we are to be consistent in protecting worker autonomy, we must apply the same standards to trade unions as we do to employers. Anything less is not principle; it is partisanship.

The Bill includes provisions that would require employers to provide workers with written statements outlining their trade union rights on day one of employment and at other points that the Government see fit. But until Amendment 218 comes along, that principle appears to vanish entirely so far as political fund contributions are concerned. A worker can be enrolled into a union and begin contributing to political causes, most often aligned with one single political party, without ever being clearly and directly told what that money supports or how to stop contributing. I believe that to be a serious democratic deficit.

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[Baroness Jones of Whitchurch (Lab)]

I think we have answered that question in quite a lot of detail now. I hope that noble Lords feel that I have answered these points in sufficient detail.

[Lord Hunt of Wirral (Con)]

We appreciate the detail that the Minister is going into, but a number of questions have not been answered. Can she undertake to write to noble Lords with the answers? Also, can she clarify whether, if a union member fails to opt out of contributing to the political fund on day 1, they could then be bound not to have the opportunity to opt out again for 10 years?

[Baroness Jones of Whitchurch (Lab)]

I am absolutely confident that union members can opt out at any time, not just every 10 years. It is the reminder that goes every 10 years, rather than the requirement for them to remain.

We have had a very detailed, long debate, and I have attempted to answer all the questions noble Lords have raised. If there are any outstanding issues, I will write. In the meantime, I ask the noble Baroness, Lady Coffey, to withdraw her Amendment 216YC.

Employment Rights Bill

Lord Hunt of Wirral Excerpts

Committee stage
Tuesday 10th June 2025 Lords Chamber

[Lord Goddard of Stockport (LD)]

My Lords, the amendments put forward by the noble Lord, Lord Jackson, which have been tabled in good faith and with good intent, aim to clarify employees’ rights for reasonable time off and to maintain a balance of obligation between employers and employees. However, this tempting repeated emphasis on balance and responsibilities risks adding unnecessary complexities to what should be a straightforward provision. The focus on sustainable assessments closely tied to individual circumstances, while well-intentioned, may create complicated decision-making for both the employer and employees, rather than finding the guidance we are looking for.

I am not a clairvoyant; I am summing up from the notes I have in front of me. The amendments from the noble Lord, Lord Sharpe, talk about linking facility time for equality representatives with statutory performance targets in the public sector—that is what the time off is for—to introduce additional conditions aimed at ensuring accountability. The proposal for a sectoral cost assessment before these changes take effect offers a measured way of evaluating their impact. It will be important to monitor how these conditions interact with the support available to employees’ representatives to maintain an efficient and effective balance.

I look forward to the Minister’s response to these amendments. I will not comment on the comments made by the noble Baroness, Lady Fox, tonight. I will leave that for the Minister to deal with.

[Lord Hunt of Wirral (Con)]

My Lords, I thank my noble friend Lord Jackson of Peterborough and the noble Baroness, Lady Fox of Buckley, for their amendments and contributions to today’s debate.

I speak to the amendments in my name and that of my noble friend Lord Sharpe of Epsom, where we seek to make the provision of facility time for equality representatives conditional on public sector employers meeting their statutory performance standards. I believe such amendments are not merely sensible but essential if we are to ensure that public resources are allocated responsibly and with accountability.

It is no secret—we hear it constantly—that politicians and civil servants routinely claim that they want to protect taxpayers’ money, yet too often the rhetoric is hollow and budgets expand unchecked. One glaring example is the unchecked proliferation of equality, diversity and inclusion, or EDI, roles in the public sector. For those unfamiliar, EDI is a branch of human resources. There are now some 10,000 EDI officers employed across public sector organisations. There has been a veritable explosion of spending that has occurred with minimal scrutiny or measurable outcomes.

Against this backdrop, it is right and proper to demand that facility time—a significant use of public resources—should be granted only to employers who are delivering on their statutory performance targets. Our amendments would introduce a performance condition that requires the Secretary of State to be satisfied that a public sector organisation is meeting relevant standards before facility time can be allocated.

I believe this to be a vital safeguard that Clause 62 as currently drafted just fails to provide. Clause 62 in its current form risks allowing facility time to be given indiscriminately, without regard for whether the employer is fulfilling its primary obligations to service users and taxpayers. That is a pretty laissez-faire approach, which I believe is unacceptable in an era of tightening budgets and growing demand for public services—no doubt we will hear much more of this from the Chancellor of the Exchequer tomorrow morning. Without this condition, facility time risks becoming yet another unchecked entitlement, further diverting scarce resources away from front-line delivery.

We must be clear, however, that supporting and moving these amendments does not mean opposing equality representatives themselves or the very important functions they perform. Rather, it just means insisting that public funds should be spent prudently, and that facility time should be tied to organisational performance. If a public sector body is failing to meet statutory targets, I believe it is irresponsible to allow additional resource commitments without first addressing those failures. Moreover, our proposed new clause would require a sector-by-sector cost assessment of facility time, introducing much-needed transparency and evidence-based policy-making. Before expanding facility time or making it more widely available, Parliament must understand its real financial impact and weigh it carefully against the public benefits.

We urge all noble Lords to refuse to accept Clause 62 in its current form but to embrace these amendments, and then we will have a crucial performance condition. In that way, we will ensure that facility time is provided responsibly, with accountability, and only when public sector employers are meeting their statutory obligations.

However, I commend my noble friend Lord Jackson of Peterborough on introducing what I felt were very reasonable amendments. Of course, he is drawing on extensive experience serving on council business and the London Fire and Civil Defence Authority, on which he served with such distinction, so I hope the Minister will accept those amendments.

I have to say to the noble Baroness, Lady Fox of Buckley, that I was appalled by the stories she gave, showing the experience of Nurse Jennifer and Nurse Peggie. They are shocking stories, and how right she was to bring them to the attention of the Committee. There is a great worry that somewhere, deeply embedded in the system, is systemic sexism. I suppose I am looking back—it is far too long ago—to when I was, and I think I probably still am, the only man to have been appointed Minister for Women in the Cabinet. I have to say that the experience I had in that position warned me of the impending problems about which the noble Baroness, Lady Fox, spoke so passionately and so clearly.

We really have to get something right. In many ways, I know that the Bill has been put together with great haste, but Clause 62 in particular at least requires amendment, or perhaps another clause more carefully thought through should be presented to the House on Report. That is why we look forward to hearing from the Minister. We are talking about not just good governance but a necessary step to protect both taxpayers and front-line public services.

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[Baroness O’Grady of Upper Holloway (Lab)]

My Lords, I thank the noble Lord, Lord Hendy, and the noble Baroness, Lady Jones. It seems to me that the key purpose behind this group of amendments is seeking to shift the balance of power a little bit more towards working people. I think you would find that many people in the country agree that that balance of power has swung too far against ordinary working people for too long.

I just want to very, very briefly say a word on Amendment 253 and underline the very grave sense of injustice that prison officers feel about the removal of what is a fundamental human right, the right to withdraw your labour, back in 1994. There is a sense that that did not in any way improve the Prison Service; I think many of us would agree that the Prison Service has subsequently faced huge challenges. We know of the huge problems that prison officers face very often, day to day, in their workplace: violence, poor conditions and vermin. I stress the appeal made by the noble Lord, Lord Hendy. Given the grave sense of injustice that is felt by people who not only stand up for fellow workers as members of the POA but stand up for a service that we could become proud of as a country, a prison service that also, I hope, does the job of rehabilitating people, we must look to engage with the POA to find a remedy to the real sense of injustice that they feel.

[Lord Hunt of Wirral (Con)]

My Lords, I will quickly follow and agree with my noble friends Lady Coffey and Lord Jackson of Peterborough in their speaking against the amendments in this group. We feel that these amendments collectively represent a dangerous and retrograde step that would just take us back to the industrial chaos of the 1970s.

Such amendments would fundamentally undermine the carefully balanced framework of industrial relations that has served this country well for, now, over 30 years. I suppose the conventions of the House require me to address each amendment in turn, starting with Amendment 239. As the noble Lord, Lord Hendy, described, this would remove Section 223 of the 1992 Act, which currently renders unlawful any industrial action taken in response to dismissals for unofficial action.

When workers engage in unofficial action—that is, action not sanctioned by their trade union and without proper balloting procedures—they are essentially taking the law into their own hands, so employers must retain the right to dismiss workers who breach their contracts in this manner. To permit official industrial action in response to such lawful dismissals would create a vicious circle where lawlessness begets more lawlessness. It would effectively immunise unofficial action from any meaningful consequences, and encourage workers to bypass the proper, democratic procedures that unions themselves have surely fought hard to establish.

Amendment 240 is perhaps the most pernicious of all these proposals. It would restore secondary action, the ability of workers not just to strike against their employer over their conditions, but to support disputes elsewhere. We banned secondary action for compelling reasons. It allows disputes to spread like wildfire across the economy, dragging innocent third parties into conflicts that have nothing to do with their industrial relationships. A dispute between workers and one employer could paralyse entire supply chains, disrupting businesses that have committed no wrong and harming workers who have no stake in the original dispute.

The amendment would also remove the sensible restrictions on picketing, allowing pickets to target any workplace, rather than just their own. This opens the door to flying pickets and the mass intimidation tactics that we witnessed in the darkest days of industrial conflict. When pickets can descend on workplaces with which they have no employment relationship, the result is not legitimate industrial pressure but mob rule. Furthermore, by changing the definition of trade disputes from those “wholly or mainly” relating to employment matters to those merely “connected with” such matters, this amendment would politicise industrial action. Strikes could be called on the flimsiest of pretexts, with only the most tenuous connection to genuine workplace issues. This is a recipe for politically motivated disruption that serves no legitimate industrial relations purpose.

Amendment 241 would restore the right to strike for union recognition. We have established statutory procedures for union recognition that are fair, democratic and effective. These procedures protect workers’ rights to choose whether they wish to be represented by a union, without the coercion that inevitably accompanies strike action. When recognition can be achieved through industrial action, the process becomes tainted by intimidation, rather than informed by genuine worker preference. No worker should ever face the choice between supporting their family and supporting union recognition demands.

Amendment 242 would remove the requirement for unions to provide employers with notice of strike ballots. This seemingly technical change would also have profound practical consequences. Employers need advance notice to make contingency arrangements, to protect vulnerable service users and to engage in meaningful dialogue that might resolve disputes before they escalate. In essential services—our hospitals, schools and transport networks—such notice is crucial for public safety. To remove this requirement would be to abandon the vital principle that industrial action should and must be a last resort rather than a first response.

Amendment 243 would eliminate the requirement for separate workplace ballots, allowing unions to aggregate completely different workplaces and employment relationships into single ballots. This strikes at the heart of democratic participation. Workers in one workplace may face entirely different conditions and concerns from those in another. They should not be bound by the votes of workers with whom they share nothing but a common union membership. Workplace-specific ballots ensure that industrial action has genuine support from those who will participate in it, rather than being imposed by a union hierarchy pursuing its own agenda.

Taken together, these amendments would create a perfect storm of industrial instability. They would restore the legal framework that gave us the winter of discontent, when rubbish piled up in our streets, bodies went unburied and hospital patients were turned away by striking workers. They would empower union leaders to spread disputes across entire industries, to bypass democratic procedures and to hold essential services hostage to political demands. We must not forget the lessons of history. The industrial relations reforms of the 1980s and 1990s did not destroy trade unionism; they civilised it. They required unions to be accountable to their members and responsive to legitimate concerns while preventing the abuse of industrial power.

The noble Lord, Lord Hendy, and the noble Baronesses, Lady Jones of Moulsecoomb and Lady O’Grady of Upper Holloway, would have us believe that they simply want to restore workers’ rights. But rights without responsibilities are merely privileges, and privileges being exercised without regard for their impact on others quickly becomes tyranny. The right to strike is not an absolute right; it is a powerful tool that must be used judiciously and with proper safeguards.

Moreover, these amendments would do nothing to address the real challenges that face working people today. They would not raise a single wage, improve a single workplace or create a single job. Instead, as my noble friends pointed out, they would create uncertainty, discourage investment and ultimately harm the very workers that they purport to be helping. Businesses need stability and predictability to grow and prosper. Industrial relations law that encourages conflict and chaos will drive investment elsewhere, taking jobs and opportunities with it.

I urge this Committee to reject these amendments. They represent not progress but regression, not liberation but license, and not workers’ rights but workers’ wrongs. We must maintain the balanced approach that has served our economy and our society so well. Let us resist the siren call of those who would drag us back to an era of industrial warfare that all of us hoped that we would never see again. The choice before us is clear. We can preserve a system that protects workers’ legitimate rights while maintaining economic stability and social peace, or we can return to those bad old days of secondary picketing, political strikes and industrial anarchy. I think and I hope that I know which path this Committee would choose.

[Baroness Jones of Whitchurch (Lab)]

I thank my noble friend Lord Hendy for his amendments on the right to strike and for raising the issue of prisoner officers’ right to strike, which was strongly debated in the other place.

I am sorry that the noble Lord, Lord Hunt, has taken such a strident approach to the issues which my noble friends have raised. Although we do not necessarily agree with everything that my noble friend has put forward, I would say equally that we distance ourselves from the tone and attitude that has been presented by the other side this evening.

Employment Rights Bill

Lord Hunt of Wirral Excerpts

Committee stage
Monday 16th June 2025 Lords Chamber

Moved by

[Lord Hunt of Wirral]

247: After Clause 70, insert the following new Clause—
“Workplace intimidation in regard to balloting (1) The Employment Relations Act 2004 is amended as follows.(2) After section 54(12)(c) insert—“(d) measures are in place to prevent workplace intimidation.””Member’s explanatory statement
This new clause requires the Secretary of State to consider whether there are sufficient measures to be in place to prevent workplace intimidation before they make any order to allow balloting to take place by a means other than by posted ballot.

[Lord Hunt of Wirral (Con)]

My Lords, Amendments 247, 248 and 250 stand in my name and in the name of several of my noble friends. Amendment 247 requires the Secretary of State to consider whether sufficient measures are in place to prevent workplace intimidation before approving any balloting method other than postal ballot.

I believe the postal ballot has served as a cornerstone and a guarantor of democracy for good reason: it provides privacy, anonymity and time for reflection. Workers receive their ballot papers at home, and can consider the issues away from workplace pressures, mark their ballot in complete privacy and return it without anyone knowing how they have voted. This system has protected workers from intimidation for generations. Alternative balloting methods, while potentially more convenient or faster, create new possibilities for intimidation that simply do not exist with postal ballots. When voting moves into workplace environments and on to devices that can be observed, we fundamentally change the dynamic of how workers participate in crucial decisions about industrial action.

Consider workplace balloting stations. Denied the privacy of home voting, workers might find themselves voting in break rooms, meeting rooms or other workplace locations where colleagues, supervisors, or even union officials can observe who is participating and when they are voting—and potentially seek to influence their decision through presence alone. The queue to vote becomes visible; the time spent considering options becomes observable; and the act of voting transforms a private decision into a semi-public one. Electronic balloting presents its own challenges. They might use personal devices in workplace settings where screens can be observed or where pressure can be applied to vote immediately rather than after proper consideration. The technology that enables quick voting can also enable quick pressure.

Each of these alternative methods, while offering potential benefits in terms of speed and convenience, also creates vulnerabilities that postal ballots simply do not have. The private space of the home; the sealed envelope; anonymous returns—these features of postal balloting provide protections that we must be careful not to lose as we embrace new technologies and methods.

We simply want assurance that, before any alternative balloting method is approved, proper safeguards exist to prevent intimidation scenarios. These might include requirements for private voting spaces, prohibitions on observing voting, secure systems that protect voter anonymity, or cooling-off periods that prevent immediate pressure to vote on the spot. Workers should be able to vote according to their genuine views about proposed industrial action, free from any form of pressure or intimidation, regardless of the source.

The employee who has concerns about strike action, or worries about lost wages, or simply needs time to consider the implications should be able to participate in balloting without feeling rushed or being observed. This protection is particularly important because industrial action ballots directly affect workers’ livelihoods. These are not abstract political decisions. They are choices about whether to risk wages, potentially face disciplinary action, or take steps that could affect their employment. Workers deserve the space and privacy to make these difficult decisions according to their own circumstances and conscience.

Amendment 248 takes a clear and necessary step to protect the fundamental principle of democratic voting by prohibiting balloting taking place in the workplace. This would prevent the Secretary of State making any order that would allow trade union ballots and elections to be held in workplace settings. The workplace is fundamentally incompatible with free and fair democratic voting. When balloting moves into the workplace environment, we create a setting where the very people who have power over workers’ daily lives, career prospects and working conditions, can observe, influence and potentially intimidate voters during the democratic process.

This prohibition recognises a simple truth: the workplace is not a neutral space. It is not a safe space for democratic participation; it is an environment structured by power relationships, hierarchies and dependencies that can compromise the integrity of voting. When workers must cast ballots surrounded by colleagues, supervisors, union officials or managers, the essential privacy that democracy requires is fundamentally undermined.

Consider what workplace balloting means in practice. Workers would be voting in break rooms, where conversations could be overheard; in meeting rooms, where attendance could be monitored; or in common areas, where voting behaviour becomes visible to everyone present. The simple act of participating or not participating in a ballot becomes observable workplace behaviour, rather than a matter of private and democratic choice. The physical presence of authority figures during workplace balloting creates inherent pressure. Union officials can observe who votes enthusiastically and who hesitates. Shop stewards can monitor participation levels and, potentially, identify workers who seem reluctant to engage. Supervisors, even if not directly involved in the balloting process, may become aware of industrial action votes taking place on their premises during work hours.

This pressure operates both explicitly and implicitly. Workers may feel compelled to demonstrate loyalty or enthusiasm through their voting behaviour when that behaviour occurs in workplace settings. The colleague who takes time carefully to consider ballot questions may be seen as insufficiently committed. The voter who votes quickly may be assumed to be following group pressure rather than individual conscience.

Workplace balloting also creates logistical pressures that can compromise democratic participation. Workers may feel rushed to vote during limited break times or lunch periods. They may worry about being seen as taking too long away from their duties. The natural rhythm of workplace life—shift patterns, busy periods and urgent deadlines—can interfere with the thoughtful consideration that democratic voting requires.

Amendment 250 would introduce a crucial requirement for transparency and accountability in industrial action by requiring trade unions to conduct and publish economic impact assessments and family tests before balloting their members on strike action. It would require trade unions to take three essential steps before any ballot for industrial action can take place: publishing an economic impact assessment; publishing a family test on the impact of industrial action; and informing their members that these reports have been published. That would ensure that workers had access to comprehensive information about the broader consequences of proposed industrial action before they cast their votes.

The case for impact assessments is compelling when we regard the real-world consequences of industrial action. For example, in 2023 the RMT union estimated that its industrial action had cost the UK economy £5 billion. The Office for National Statistics reported that during those 16 days of NHS strikes between December 2022 and February 2023 at least 93,000 out-patient appointments, 18,000 elective procedures, 9,500 mental health and learning disability appointments and around 28,000 community service appointments had to be rescheduled because of strike action. That had a significant impact on people who were in urgent need of important support.

The ongoing Birmingham bin strikes provide a stark illustration of how industrial action can affect whole communities. Birmingham City Council declared a major incident after 17,000 tonnes of rubbish were left uncollected on the streets, requiring assistance from not only other local authorities but even Army specialists for logistical support.

The strike has disproportionately affected lower-income and inner-city areas, such as Sparkhill, Balsall Heath, Small Heath, Sparkbrook and Ladywood, where refuse has piled up to a greater degree than in more affluent suburbs. The health implications have been severe: uncollected waste has the potential to create not only nuisance for the community from flies and vermin, but public health risks. The policing costs alone have been substantial, with the costs of policing the Birmingham waste dispute reaching almost £1 million.

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The Bill will still require trade unions to ask the members on the ballot paper for industrial action which type of industrial action they want to take part in, expressed in terms of whether this is strike action or action short of a strike. Ballots will also continue to be independently scrutinised. This will help ensure that trade union members are able to make informed decisions when voting on proposed strike action. In light of this, I therefore ask the noble Lord, Lord Sharpe of Epsom, or indeed the noble Lord, Lord Hunt of Wirral, to withdraw Amendment 247.

[Lord Hunt of Wirral (Con)]

My Lords, I am very grateful to my noble friend Lord Jackson of Peterborough. I had not thought, when preparing my address, to look back to 1834. The only time I ever talk about 1834 is recalling that on 16 October 1834, this whole place burned down and gave rise to the new mother of parliaments we know today. Only Westminster Hall survived that terrible fire in 1834.

All I will say about the Tolpuddle Martyrs who were sentenced to be sent to Australia is that two years later they were pardoned, and they all went to Canada; I think Canada benefited hugely from that exodus. But I am not quite sure that we can read across because so much has changed, as the noble Baroness, Lady O’Grady of Upper Holloway, reminded us.

The noble Baroness also referred us back to the coalition—it was not a Conservative Government but a coalition in 2014—and cited Bruce Carr KC, who I respect hugely. He is a brilliant advocate in this whole field of employment law, but I am not quite sure that I read across in the way the noble Baroness did.

I agree with the noble Baroness, Lady Kramer, that it is all a question of balance. We have to try to do our best to get the balance right but, as we draw the debate on these amendments to a close, I want to say how sorry I am that the Government declined to accept these modest but essential amendments, although I pay tribute to the noble Lord, Lord Katz, for saying that they are well intentioned. Of course they are, because they are rooted not in ideology but in common sense, democratic principle and a genuine concern for those people who will be affected most by this legislation.

Throughout this short debate, we have tried to put across the case that industrial action is not just a technical but a deeply human process. It involves individuals making weighty decisions that affect their income, their job security, their families and the wider community. That is why the processes we set in place to govern these decisions must be fair, private and informed.

We argue in these amendments that workers deserve to vote on industrial action in conditions that are free from coercion or surveillance. We said that the workplace, structured as it is by hierarchies and power dynamics, is not and cannot be a neutral environment for democratic expression. I do not need to go back to the 1970s but, of course, that is when I entered Parliament for the first time, and we saw a lot of decisions made in the workplace that people regretted afterwards.

I ask the Government to consider the very real risk of intimidation, whether explicit or subtle, and to preserve the privacy that postal balloting has long guaranteed. We were not asking the Government to turn the clock back on technological progress; we were just saying that any movement away from the postal ballot has to be accompanied by genuine, enforceable safeguards. Yet, sadly, the Minister refused to accept even the simple premise that the method of voting matters—that how a person votes is as important as the person for whom they are voting.

We also asked for transparency. Through Amendment 250, we sought to ensure that unions undertaking industrial action do so with an honest reckoning of the broader consequences—economic, social and familial. We know that strikes do not happen in a vacuum; they ripple outward, touching the lives of patients, parents, commuters, businesses and whole communities. I certainly do not want to prohibit strikes, but we believe that workers have to be given the full picture before they make a serious decision to withdraw their labour.

I am particularly disappointed because these amendments would strengthen the public’s confidence in this legislation. They would have shown that Parliament is serious about protecting not only workers’ rights but democratic process, public welfare and social responsibility. Instead, the message is now that efficiency is more important than privacy, that speed matters more than integrity, and that the consequences of industrial action—no matter how far reaching—need to be honestly appraised before the strike begins.

All I will say in conclusion is that the debate does not end here. I do not believe that these concerns will go away. The consequences of inaction, the risks of intimidation, the lack of transparency and the damage to public trust will, in time, make themselves known. When they do, I hope the House will remember the case that we have made today. In the meantime, I beg leave to withdraw the amendment.

Amendment 247 withdrawn.

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[Lord Hunt of Wirral (Con)]

My Lords, I thank the noble Lord, Lord Prentis of Leeds, for describing this amendment to us. It is simple and easy to understand but founded on a very difficult and testing industrial dispute. Looking back over my time as a parliamentarian, I often found that facts get distorted, beliefs underpinned and positions entrenched. The last thing that should ever happen is an overt change in the law. I do not believe that is necessary. Let me explain why.

The Minister should not support this amendment, which, as the noble Lord, Lord Prentis, explained, seeks to extend Section 145A of the Trade Union and Labour Relations (Consolidation) Act 1992 to cover the exclusion or omission of a worker from an offer on grounds related to trade union membership or activity. While the noble Lord presented this amendment as a measure to strengthen workers’ rights and reinforce freedom of association, in reality, on reflection, as he virtually admitted when he introduced it, it is poorly drafted, conceptually flawed, legally confusing and potentially deeply damaging to the legitimate and practical functioning of workplace relations.

At its core, the amendment misunderstands the balance that needs to be struck between protecting the rights of trade union members and preserving the autonomy of employers to make operational decisions in good faith. The current law already provides robust protections against unlawful inducements that seek to undermine collective bargaining. I recall, because I was in government at the time, that Sections 145A and 145B were carefully crafted to target deliberate attempts by employers to bypass or undermine collective agreements. This amendment goes significantly beyond that, seeking to introduce for the first time in statute a wholly ambiguous and legally unstable concept—exclusion from an offer—without providing any meaningful guidance or definition as to what such exclusion means, how it is to be assessed and in what contexts it is to be deemed unlawful.

An offer, by its very nature, is made on the basis of specific criteria—sometimes economic, sometimes strategic and sometimes tied to an individual’s performance or to business need. To say that a worker has a right not to be omitted from any offer and to link any such omission to trade union membership or activity would place an intolerable burden on employers. It would open the door to speculative claims and second-guessing of decisions that may have been made for entirely legitimate and neutral reasons, relying on an inference of motive in the absence of solid evidence. Effectively, it demands that employers should treat all workers identically in every instance of any offer—whether it is financial, procedural or preferential—or face litigation and the reversal of the burden of proof. Let me explain.

The amendment proposes that in any case brought under the new Section 145A(1A), it will fall to the employer to demonstrate the grounds upon which the worker was excluded. That is a fundamental reversal of the ordinary legal principle that a claimant must prove their case. It turns routine management discretion into presumed unlawful conduct unless proven otherwise. Such a reversal may be appropriate in narrow cases where discrimination is clearly alleged and supported by a pattern of conduct, but to write it into statute so broadly and in such general terms is not only disproportionate, it is potentially destructive to employer-employee trust and clarity. No employer, however well intentioned, will be able to manage negotiations or individual agreements with confidence under such a regime.

Furthermore, the amendment also risks creating legal confusion by overlapping with other provisions already in place to protect against victimisation or unfair treatment. Section 146 already protects against detriment related to trade union activities. Section 145A already prohibits inducements that would bypass collective bargaining. If the goal is to ensure fair treatment of trade union members, the proper route is through targeted enforcement of those provisions, not through the introduction of vague and speculative new rights that overlap and conflict with existing law.

The amendment is also unbalanced in its approach. It fails to consider that there are many reasons why an individual might not be included in an offer that are entirely unconnected to trade union status. It might be on account of their role, their location, the timing of their employment or performance-based factors. Yet under the proposed amendment, a worker could simply allege that their omission was because of trade union membership or activity, and the burden would shift entirely to the employer to justify its actions. That is not just an invitation to abuse; it is a structural distortion of fairness in employment law.

It must also be acknowledged that this amendment could have chilling effects on legitimate collective bargaining. Employers may feel compelled to make across-the-board offers rather than engaging in more flexible, targeted negotiations that take into account differences in role, responsibility or need. That could undermine not only business efficiency but also the ability of unions themselves to secure advantageous outcomes for specific groups of members. The very act of negotiating special terms for one group might now trigger complaints from others, citing this amendment as grounds for a claim of exclusion.

In conclusion, let me be absolutely clear: freedom of association is a vital right and must be protected. I do not believe, however, it would be served by new laws that are unclear, that burden employers without cause or that generate more confusion than clarity. This amendment—despite its rhetorical appeal to equality and fairness—will in practice be a blunt and imprecise instrument, increasing litigation, reducing operational flexibility and contributing little, if anything, to the genuine promotion of union rights. I hope the Minister will agree with that.

[Lord Leong (Lab)]

I thank the noble Lord, Lord Hunt, for his lengthy contribution. All he had to say was, “I do not support the amendment”. I thank and appreciate my noble friend Lord Prentis of Leeds for tabling Amendment 253A, which sets out that workers have a right not to be omitted from an offer by their employer because, among other reasons, they are trade union members. This amendment has been laid in response to a particular matter regarding the housing association Livv Housing Group, which last year reportedly made a pay offer to only those members of its workforce who confirmed that they were not trade union members. I am pleased that this matter has now been positively resolved in the workplace, as set out by noble friend.

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[Baroness Coffey (Con)]

My Lords, this whole group of stand part notices is basically about the removal of powers from the certification officer. We have already debated Clause 77. In thinking through what is going on here, I wondered whether there would be anything of a certification officer left, because it feels like a lot of this stripping out of certain aspects—for example, in Clauses 79 to 83—is very limiting in terms of what could be left to be done.

Since the Trade Union Act 2016 came into effect, the world has somewhat moved on in terms of transparency and wanting to know what is going on in an organisation. I appreciate they are not state bodies, but trade unions play an important role in our country. It is important that, while recognising there is a declining membership, not in the public sector but in the private sector, for those people who are contributing money every week, every month, every year—whatever it is—having a good amount of information in a consistent way is a good thing in terms of thinking about how we promote aspects of transparency.

We have had considerable debate, as I say, about Clause 77. But I am struggling to understand what the issue really is—why it is so difficult for these things to be produced. In thinking about investigatory powers, let us put a bit of reality or real life into this. There has been a situation within the last six months where an election for the general secretary of the Fire Brigades Union happened. On a 29% turnout, a person was elected. That turnout of votes equated to something like fewer than 10,000 people casting their votes in favour of that candidate. However, it was subsequently discovered that 3,000 ballot papers were not issued. I am happy to be corrected if I am wrong, but the difference between winning and losing was less than 3,000. Understandably, the person who lost, who had been in post for nearly 20 years, was somewhat aggrieved. However, when it was decided there had obviously been a breach and something had gone wrong, the certification officer went through a proper process. The Government may well argue that it would have been safer to email out ballots, or do an online ballot, rather than relying on the post. I am sure the union staff were not the only people struggling with things not being delivered by Royal Mail at that time. However, after that process, the losing candidate chose not to require the election to be rerun, which would have been within the gift of the certification officer. In terms of general justice, without having to go to the expense of going to the High Court, a certification officer was a simple way to try to remediate something that was clearly unfair.

However, the person who lost—I am not going to name them—was then very quickly appointed general secretary of another trade union. This time, that was challenged directly by the union’s members. In that instance, I think they went not to the certification but immediately to the High Court. So, one person having lost an election, another trade union—that is the teaching union—used its procedures incorrectly to put them in place as its new general secretary. Then, thanks to the legal challenge, the executive committee of that union recognised that it had not acted properly. This same person, by the way, is still acting general secretary of that trade union. The election commences on Thursday; it is up to the members who they decide to vote for, of course.

I looked at the fairness of a variety of the decisions that the certification officer made over time, and the same teaching union was in breach a few years ago because its general secretary outstayed their elected term. They were then made an acting general secretary and, about a year later, there was another election. It is very expensive if trade union members have to go to the courts over these sorts of things. As I researched these clauses and found out what has happened in real life, it reminded me somewhat of Animal Farm, and how—what was it?—“Two legs bad, four legs good” evolved over time to suit the needs of those who decided that they would be in charge.

I appreciate that trade unions might feel that we should not need to have a certification officer, but these are good examples of where people have had recourse to an independent person who, by law, is not subject to ministerial direction. Those people can have complete confidence in the integrity of the certification officer, and that going to them will lead to somebody having a look, without the cost of going to the High Court—as we know, that is expensive. I understand that Labour has this mantra that it is going to repeal anything to do with the 2016 Act, but I really want the Government to consider why, seeing some of the changes that have happened. By the way, at the same time, they are bringing in different rules for employers in dealing with their employees. It is perfectly valid for them to do so, but just imagine the impact these sorts of stories have. It so happens that both the trade unions in my examples are public sector unions, and we have seen their overall membership increase, but we should not be surprised if lack of confidence has started to drift people’s concerns away on why they need to pay to be a member of a trade union.

I wish the Government would consider carefully what the removal of any of these clauses would do to help the average worker and the average trade unionist, who may not be highly connected and may not have chosen to join a political party or to dedicate their lives, from quite an early age, to being part of that trade union leadership. They should also think about, and this is one of the reasons why I got triggered, what happens when somebody completely left-field—or right-field, whatever—comes in and their union’s ruling body decides, “Yeah, we like the look of that person” and they are not sure why; it may have felt sorry that he had just lost an election elsewhere. Let us think carefully about whether it is the right approach to remove all these powers from the certification officer, which I think people from every level can see are used, rarely and not extensively, to apply some common sense.

[Lord Hunt of Wirral (Con)]

My Lords, I will speak in support of my noble friend Lady Coffey. I thank her for bringing forward these crucial amendments to oppose Clauses 76 and 78 to 83 standing part of the Bill. In doing so, she not only upholds the integrity of trade union regulation but calls out a deeply troubling double standard in the Government’s approach to industrial relations.

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[Lord Fuller (Con)]

My Lords, I support this amendment, but not for the reasons my noble friend gave. Many years ago—Members on the Government Benches may realise quite how long ago this is when I give the names of the unions concerned, which are long since consigned to history—I was the director of a small haulage firm. It no longer exists or trades, but I cut my teeth on labour relations behind the wheel.

In our small business, which employed about 50 people, there were three types of worker: those who were not in a union at all, a small number who were with the TGWU—that dates me—and those with a new union, the United Road Transport Union. The shop steward of the URTU came to see me and said: “It’s like this, John. I think that you should recognise our union”. So I did. It was personally convenient to deal with one person rather than try to have a mass meeting with 30 or 40 people, all with different views. Unlike what some noble Lords might think of those on the Conservative Benches, I found a huge amount of value in being able to negotiate with the URTU, which had the most members but was not entirely pervasive in our company. Arthur Harris was in the TGWU—he was such a long-standing member of our business that he was employee no. 1 on our payroll system—and was not about to go to the URTU for a moment.

The point of this story is that I negotiated in good faith with the URTU and recognised that it had the most members. When making an agreement, we were somewhat apart but not completely, and I said: “Peter, put this offer to them and let’s see what they say”. He did not really want to, but the point is that I needed to make the offer as well to the other union, the TGWU, and to those members who were not in a union at all.

My noble friend made the point about the Port of Felixstowe and I inferred from her remarks that there was a single union to deal with, but that is not the landscape for many organisations. Later this evening I will talk about my experiences in local government, where there are three different unions involved—UNISON, Unite and the GMB—and a complicated negotiating environment.

I support this amendment because it provides equality to the smaller unions, not just the big ones, some of which have their own agendas. It is incumbent on all unionised labour to at least see what is on the table, whether or not their union negotiated it. That is why my noble friend’s Amendment 257A is very important and should be given proper consideration; it recognises the complex labour landscape found in many companies, particularly in private business, not just the monolithic larger organisations where there are single unions, facility time and other things.

[Lord Hunt of Wirral (Con)]

My Lords, I strongly support my noble friend’s amendment, which, as she explained, addresses a fundamental democratic deficit in our current industrial relations framework. I thank my noble friend Lord Fuller for giving his personal experience of how important this deficit can be if it is not addressed.

This amendment would require trade unions to present any employer offer to their membership for a vote, regardless of whether the union leadership supports it. My noble friend gave the example of Felixstowe; others could give similar examples, such as what has been happening with the Birmingham strike. This is not an anti-union measure—it is a pro-democracy measure that seeks to strengthen the voice of individual workers within the collective bargaining process. It recognises that in a democratic society it should be workers themselves, not union officials, who decide whether an employer’s offer meets their needs and aspirations.

The principle underlying this amendment is simple and would be seen as uncontroversial in any other democratic context: those affected by a decision should have the right to make that decision for themselves. When union leaders can simply reject employer offers without consulting their membership, they effectively deny workers the fundamental right to democratic participation in decisions that fundamentally affect their livelihoods. We would surely not accept a system where parliamentary leaders could reject government proposals without allowing MPs to vote. We would not tolerate local councils where executives could dismiss motions without having to present them to councillors. The same should surely apply to trade unions.

This amendment recognises that the priorities, circumstances and risk tolerances of individual workers may differ from those of their union leadership. A young worker saving for a house deposit may take a very different view of sustained strike action from that of an established worker nearing retirement. A worker in precarious financial circumstances may prefer settlement on reasonable but suboptimal terms to prolonged uncertainty and loss of income. Surely we all want to avoid a situation where workers are denied a voice in decisions that so profoundly affect their lives.

Contrary to weakening collective bargaining, this amendment would strengthen it by increasing member engagement and ensuring that union positions truly reflect membership priorities. When workers know that they will have the final say on offers, they are more likely to engage with the bargaining process and provide clear guidance about their priorities. Enhanced member involvement can improve union negotiating positions by ensuring that they are based on genuine membership preferences rather than leadership assumptions. It can also increase employer confidence in the bargaining process by ensuring that negotiated agreements will not be undermined by membership rejection.

Although many trade unions always act in good faith when considering employer offers, this amendment would put protections into legislation to prevent bad actors denying workers their democratic voice. Without legislative safeguards, the system could enable a dangerous information asymmetry where union officials control what information reaches members and the manner in which that information is presented.

Employment Rights Bill

Lord Hunt of Wirral Excerpts

Committee stage
Monday 16th June 2025 Lords Chamber

Moved by

[Lord Hunt of Wirral]

263: After Clause 86, insert the following new Clause—
“Consultation on trade union legislation(1) The Secretary of State must initiate a consultation on the effects of the provisions in Part 4 of this Act on the operation of the Trade Union and Labour Relations (Consolidation) Act 1992. (2) The Secretary of State must lay before each House of Parliament, no sooner than eighteen weeks after the initiation referred to in subsection (1), a report on—(a) the outcome of that consultation, and(b) the Government’s proposals for changes to the legislation referred to in subsection (1).”Member’s explanatory statement
This new clause requires the Secretary of State to undertake a consultation on the operation of trade union legislation.

[Lord Hunt of Wirral (Con)]

My Lords, Amendments 263 and 330 standing in my name require the Secretary of State to conduct a consultation on the effects of the provisions in Part 4 on the operation of the Trade Union and Labour Relations (Consolidation) Act 1992 and to report on the outcome and any proposed changes. It is a modest proposal, even a restrained one, but, make no mistake, it is a necessary amendment and a crucial one.

What we have before us in Part 4 is not the result of careful planning, measured engagement or evidence-based policy. No, what we have instead is a so far unconsulted set of sweeping reforms to trade union law inserted on Report in the other place with little scrutiny and even less transparency. I believe it is extraordinary that provisions of such weight, which could dramatically alter the balance of industrial relations right across the country, should arrive in this House having not been through a proper public consultation. The provisions would allow the Secretary of State to rewrite fundamental aspects of how trade unions operate, how they are recognised, how they interact with businesses and how ballots are conducted. This is not a footnote to the Bill. This is, I believe, a redrawing of the boundaries of employment law and industrial relations. It has been done without engaging employers, without informing the HR community and without giving those who will be most directly affected any chance to prepare.

We must ask ourselves who, precisely, was consulted. It certainly was not business. It was not those employers, large and small, who will be forced to navigate the implications of this legislation. We are left to presume that only the trade unions were consulted, or at least advised, because the changes serve their interests almost exclusively. They have access to workplaces in ever-broadening circumstances. There is the weakening of independent oversight by stripping powers from the certification officer; the dilution, or in some cases outright removal, of long-standing ballot thresholds that were introduced to protect the legitimacy of industrial action; and the potential for significant changes to trade union recognition processes that could alter the employer-union relationship fundamentally—all to be done by secondary legislation.

That point cannot be emphasised enough. These changes are not in the Bill. They are hidden in the detail that is to be brought forward later through regulations, through statutory instruments, through mechanisms that allow for no amendment and only limited debate. That is no way to legislate on matters as fundamental as the recognition of trade unions or the conditions for lawful industrial action. These are not administrative details. These are foundational questions of how workers and employers interact under the law. They deserve full, open, transparent scrutiny. They deserve proper consultation.

Perhaps most galling of all is that even when the Government speak of consultation, they do so with inconsistency and confusion. I draw your Lordships’ attention to two statements by the Minister for Employment Rights in the other place, Mr Justin Madders. On 7 May he stated unequivocally:

“No decision has yet been made by the Government as to whether or when to exercise this power. Therefore, there is no planned timetable for consulting on it at present”.


No decision, no timetable, no consultation—yet less than a month later, on 3 June, the same Minister declared:

“The Government will consider what criteria to assess whether to lower the recognition threshold in due course, including through the public consultation process”.


We go from no consultation to a planned consultation in the space of four weeks.

This is not just a contradiction. It is, sadly, becoming a symptom of a Government who are making policy on the hoof and who are unable or unwilling to provide clarity on matters of legal and constitutional significance. Let us talk plainly about what that power is. It is the power to reduce the threshold for trade union recognition to just 2%. No justification is offered for that number. There is no White Paper, no consultation document, no cost-benefit analysis, no report from ACAS, no statement from employer organisations or trade bodies, not a single name that the Government can point to that supports the reduction of that recognition threshold to just 2%.

Yet here we are, with Ministers potentially claiming this power to change that threshold by statutory instrument, out of reach of substantive parliamentary control. Why is it 2% and not 20% or 50%? If the Government believe that a change is needed, surely a change should be in the Bill and the rationale should be available to all stakeholders, including this House. If the Government are not prepared to provide that rationale, surely we are entitled to suspect that it has not been thought through.

How will employers respond to these changes? What of the small businesses, the charities, the start-ups, the growing firms that have never had to deal with trade union recognition processes before? They are not anti-trade union. They are simply unprepared, yet under these proposals they may soon be required to accommodate access, to facilitate recognition and to engage in statutory processes for which they have no guidance, no support and no warning. These employers are being thrown into an environment of legal uncertainty, an environment shaped not by consultation or consensus but by expediency. It is also abundantly clear that the Government have shown little interest in listening when they have, in the past, consulted.

On those parts of the Bill where consultation has occurred, however limited, the views of employers and professionals have largely been ignored. We are hearing consistently that business voices are being drowned out and that legitimate concerns about workability, proportionality and unintended consequences are being brushed aside. What then is the purpose of consultation, if it is treated as a procedural formality rather than a genuine dialogue?

Let me repeat again for emphasis: on trade union recognition itself, there has been no consultation. It was confirmed in the other place. To move forward with such a major change in industrial relations law without even the courtesy of asking stakeholders their views is frankly an abdication of responsible governance.

I do not stand here as someone hostile to trade unions: far from it. I recognise their historic role and their ongoing contributions to workplace fairness and safety. But fairness has to go both ways. Changes of this scale must be fair, transparent and built on consensus, not stealthily inserted into a Bill and then pushed forward by ministerial decree. That is why the amendment matters. It seeks only to do what the Government should have done in the first place. It seeks to restore process and balance where neither is currently present. I urge your Lordships to support it, not out of ideology or political interest but out of principle, out of a shared commitment to deliberative democracy and out of basic respect for all those who will live and work under the laws we make in the House. I beg to move.

[Baroness Coffey (Con)]

My Lords, the reason I support the amendment is that it links making sure we get the consultations done and then not proceeding with the legislation until that has been printed. This goes to the heart of trying to understand, in effect, the detail of the Bill and how it really will impact jobs, because that is what this is about; how we will not only help workers but make sure they have jobs to still be in. That continues to be the underlying concern, which is why this perfectly formed group of amendments makes sure that at least this House knows full well what the expectation is that employers have, and the risks and opportunities that are highlighted, before it makes the final decision on when this becomes legislation.

--- Later in debate ---

[Lord Leong (Lab)]

I thank the noble Baroness for her question. I am very clear about micro-businesses, medium-sized businesses and small businesses. At the event I attended, we had everybody. Not all were B Corps. We had owner-run businesses, businesses with just one or two employees and medium-sized businesses as well.

[Lord Hunt of Wirral (Con)]

My Lords, I am disappointed that the Minister does not wish to engage in responding positively to this amendment. My noble friend Lady Coffey put it very much in context, and my noble friend Lady Verma stressed again the complexity of what we are talking about so far as small and medium-sized enterprises are concerned. My noble friends Lord Leigh of Hurley and Lady Noakes further put questions to the Minister, to which I do not think he has responded positively.

I say once again that I cannot see why the Government cannot accept this amendment. On trade union recognition, for instance, there has been no consultation at all. Yet this is a major change. It is the “etc” in Part 4 that I get worried about. Part 4 is described as:

“Trade unions and industrial action, etc”.


There is so much here that has not been consulted on. I agree with the Minister that there has been some consultation, but have the Government really listened to the results of that consultation? Why have they not consulted more widely, particularly on trade union recognition? I think this is an aspect to which we will have to return on Report. In the meantime, I beg leave to withdraw the amendment.

Amendment 263 withdrawn.

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[Lord Davies of Brixton (Lab)]

My Lords, it is a real pleasure to come on to the subject of pensions at 10.30 pm. However, I know not to try the patience of my noble friends or even the noble Opposition. In truth, the amendment, although it comes up here and refers to enforcement and the fair work agency, is really about the place of pensions within the Bill. My contention is that pensions are not given adequate consideration, and I am using this as a mechanism to press my noble friend the Minister to expand on how the legislation will reflect on pensions.

Of course, we get the Bill. One wonders how legislators coped before the introduction of “word search”, because there are 300 pages, 157 clauses and 12 schedules; and a use of word search tells us that “pension” appears 19 times in such a massive piece of legislation, and quite a few of those are where it forms part of “suspension”. The Bill fails to give any serious consideration, as far as I can see, to the place of pensions as an important element in the terms and conditions of employment.

That is where I started from. I looked at particular ways that pensions should be addressed in the Bill. The amendments we are considering now—Amendments 264, 265 and 324—are tabled as a sample to press my noble friend to explain.

Amendments 264 and 265 relate to Schedule 7 and enforcement of labour legislation. There is labour legislation on pensions: there are obligations on employers to consult trade unions in certain circumstances—that is covered by Amendment 264. Amendment 265 in effect applies to automatic enrolment, where it is an inherent part of the labour contract that people have that pension. Enforcement agents are going into companies. If they are going in, it seems a wasted opportunity if they do not check for compliance on these particular issues as well as the other issues specified in the Bill. At heart, my amendments are a request for my noble friend to explain whether these issues and pensions more generally should not be included throughout the Bill.

My Amendment 324 appears very late on; it has been promoted from the “miscellaneous and general” part of the Bill. It seeks a definition of “remuneration”, which appears 75 times in the Bill but is not defined anywhere. It could well be defined by other legislation and judgments in the courts, but there seems to be a total lack of consistency. I could point to particular judgments and international standards where remuneration is defined in one way or another, but there is no overall consistency. Yet remuneration is clearly a crucial part of the Bill and there is a lack of clarity about what it means. I really hope that it is obvious; I am raising the issue only because I want the Bill to include pensions. You cannot understand someone’s remuneration if you do not know what pension they are being offered; it is part and parcel of the package. To look at some elements but not pensions seems wrong.

I urge my noble friend to make a positive response that the Bill will be looked at in detail again for places where pensions should have their proper role. I beg to move.

[Lord Hunt of Wirral (Con)]

I always have tremendous respect for the noble Lord, Lord Davies of Brixton, in particular his knowledge of pensions, because he, like me, is an actuary. Whereas he is a true actuary, I am just an honorary fellow of the Institute and Faculty of Actuaries, so I always respect his views.

I am not sure there is very much I can say in intervening between him, his Secretary of State and the Minister. All I will say is that his amendments represent a shift from a consultative culture to a more legalistic and punitive model. That would be a shift at great cost. Like him, I believe that people are entitled to proper pensions and proper security. Like him, I fought on many occasions to ensure that that is an enforceable right.

I do not want to anticipate what the Minister will say, but we have to consider the employer’s perspective. We all want to see businesses offer generous, flexible benefit schemes—things such as pension contributions, healthcare and travel allowances—but if those are brought into tight regulatory definitions and packages, and enforcement frameworks, I worry that some employers might feel discouraged from offering them at all. I await the response of the Minister.

[Lord Leong (Lab)]

My Lords, I thank the noble Lord, Lord Hunt, for his contribution, and my noble friend Lord Davies of Brixton for tabling Amendments 264, 265 and 324.

I respect my noble friend’s concern for upholding rights relating to pensions. The power in Part 2 of Schedule 7 would allow us to extend the fair work agency’s remit to cover enforcement of pensions legislation in the future, but it would not be appropriate to make this expansion to the fair work agency’s remit at this time. Changing how pensions are enforced would be a significant undertaking, requiring careful consideration, consultation and planning, not least regarding how the fair work agency would interact with the current Pensions Regulator. Therefore, I must respectfully resist these amendments.

Amendment 324, also in the name of my noble friend Lord Davies of Brixton, seeks to ensure that pension arrangements are covered by the definition of remuneration. While I understand my noble friend’s concern here, this amendment is not necessary and its introduction would have far-reaching implications across the Bill. While pension arrangements are already covered by some of the provisions in the Bill, it brings forward issues around sectoral collective arrangements, which I am sure my noble friend would not want to frustrate. So while I appreciate the intentions of my noble friend Lord Davies of Brixton, I respectfully ask him to withdraw Amendment 264.

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As I say, these amendments do not introduce new policy, and I hope that noble Lords will see that they are necessary to deliver what is an important policy that has broad support. I beg to move.

[Lord Hunt of Wirral (Con)]

My Lords, I thank the Minister not only for her speech but for the briefing she held for all Peers to explain the background to these amendments. We fully appreciate that from time to time, there may be technical issues with legislation that necessitate amendments being brought at a later stage. Such occurrences are of course all part of the legislative process. In this instance, however, it is disappointing that these matters were not addressed and dealt with from the outset.

Ideally, these amendments should have been tabled and thoroughly considered in the other place. Instead, we have seen the Government bring forward a number of policy-related amendments at a relatively late stage—amendments which, regrettably, received limited scrutiny in the Commons. I do not believe that this approach lends itself to the transparency and rigorous examination that effective lawmaking demands. We sincerely hope that in future, the Government will engage with the legislative process in a more considered and structured manner. Proper scrutiny at all stages is not just a formality; it is essential in ensuring that the laws we pass are sound, effective and in the public interest.

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Moved by

[Lord Hunt of Wirral]

267A: Clause 89, page 108, line 17, leave out paragraph (b) and insert—
“(b) the conduct of, but not the decision as to whether the Secretary of State will bring, proceedings by virtue of section 113 (power to bring proceedings in employment tribunals).” Member's explanatory statement
This amendment seeks to ensure that the Secretary of State cannot delegate the decision to bring proceedings on behalf of employees.

[Lord Hunt of Wirral (Con)]

My Lords, these amendments address important gaps in the Bill, ensuring fairness, clarity and accountability in the enforcement of employment rights. Amendment 267A relates to Clause 89 and the delegation of the Secretary of State’s functions. Currently, the Bill allows delegation of functions, including enforcement, but does not explicitly restrict the delegation of the decision to bring proceedings to employment tribunals.

This amendment would ensure that while the Secretary of State is delegating the conduct of proceedings, the crucial decision to initiate legal action remains with the Secretary of State. Without this safeguard, delegated bodies could independently decide whether to bring legal claims, potentially leading to inconsistent decisions, lack of ministerial accountability and confusion about who holds ultimate responsibility. Maintaining ministerial control over such decisions is essential to preserve political accountability and to ensure decisions are made with proper oversight.

Amendment 271B focuses on Clause 113 and seeks to clarify the scope of claims that the Secretary of State may bring. The Bill currently refers broadly to “any enactment”, which risks allowing the Secretary of State to bring claims on a wide range of employment issues, including individual employment rights traditionally pursued by workers themselves. This amendment narrows that scope to relevant labour market legislation and Parts 1 to 4 of the Employment Rights Act 1996, ensuring that government enforcement targets systemic labour market regulation issues such as pay and working conditions, rather than individual employment rights or disputes. Without this restriction, there is a risk of governmental overreach into private employment matters, diluting resources and causing confusion about the limits of state intervention.

Amendment 271C addresses a practical and vital issue regarding claims that workers have already lawfully settled. Under current law, individuals can settle employment claims following independent legal advice, providing certainty to both employers and employees. This amendment prevents the Secretary of State bringing claims that had been settled in accordance with Section 203 of the Employment Rights Act 1996. Without this amendment, there is a danger that settled claims could be reopened by the Government, undermining the finality of agreements and subjecting employers to repeated litigation, even after fulfilling their obligations. Such uncertainty would damage trust in settlement processes and could discourage both workers and employers from entering into settlements.

Amendment 272ZA concerns the financial protection of workers in tribunal proceedings brought or conducted by the Secretary of State. It ensures that where an employment tribunal orders costs against a worker, such as legal costs or wasted costs, these costs must be met by the Secretary of State rather than the individual worker. This protection is critical, because workers who had not themselves initiated proceedings should not bear the financial burden of litigation costs. Without this safeguard, workers could face significant personal financial risk, deterring them from seeking support from the Secretary of State and ultimately restricting access to justice. Employers might then attempt to recover costs from these workers, imposing unfair hardship and undermining the purpose of public enforcement. I beg to move.

[Baroness Noakes (Con)]

My Lords, I have Amendment 272 in this group. When an Act of Parliament creates rights and duties, it usually then allows those who benefit from the rights and duties to enforce them in law, which in the case of employment matters is via the employment tribunal.

This Bill fundamentally changes that and inserts the Secretary of State whenever he or she wants to intervene to take up cases that employees do not themselves want to pursue. It also interferes in the order of things by providing a back door route to legal aid for employees, which is not covered by the normal legal aid system. This part of the Bill is simply going to increase the number of cases heading towards the employment tribunal. As has been debated on several occasions, that system is already under massive stress, and it does not make any sense to stress it any further. I therefore support all the amendments in this group.

My own Amendment 272 merely states that the Secretary of State has to meet a public interest test if he or she wants to use the Clause 91 power to take over a case that an employee does not wish to pursue themselves. As drafted, there is no constraint whatsoever on the Secretary of State’s use of the power. The Secretary of State can simply find out one morning that an employee has a potential case and is not going to do anything about it, and decide to take it over. A public interest test would at least make sure that the Secretary of State intervenes in matters where there is a genuine national interest in the case being pursued.

I suspect that the Secretary of State will be pursued and lobbied by various organisations, quite possibly trade unions, who will see this provision as another weapon in their armoury to have a go at certain large employers, particularly where those employers have not been particularly interested in playing along with whatever trade unions want to do with them. The power is an important departure from the normal way of enforcing rights and duties, so guardrails in the legislation surrounding the use of the power are essential. There is absolutely nothing in the current Bill.

My first instinct was to delete Clause 91 entirely. As far as I can tell, no case has been made for its existence. But I can just about construct a scenario in which the Secretary of State concludes that there is a genuine public interest in overriding the wishes of an employee and pursuing the case in the circumstances I have described. I would expect such a case to be very unusual, and I hope the Minister agrees. Because of that, we should be looking to restrain the power in some way. The words I have used may not be the right words, but the essence of what I am trying to achieve is to reduce into something more reasonable an unconstrained power to completely subvert the normal way in which rights and duties are specified by Parliament and open to enforcement.

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[Baroness Jones of Whitchurch (Lab)]

My Lords, I thank the noble Lords, Lord Sharpe and Lord Jackson, and the noble Baroness, Lady Noakes, for tabling their amendments. This Government are committed to ensuring a fair playing field for all employees and businesses. This is why the Secretary of State will have the power to bring proceedings in place of a worker: it will mean that all employers are held to the same standards.

Amendments 267A, 271B, 271C and 272ZA have been tabled by the noble Lord, Lord Sharpe of Epsom. While I appreciate the noble Lord’s intentions behind them—seeking fairness, clarity and accountability—I believe that they undermine those objectives. I have major concerns about Amendment 267A. A fundamental principle of the fair work agency is that it will have operational independence. As we have debated, the Secretary of State’s involvement will be at strategic level only. This amendment would undo all that; it would explicitly make any use of the civil proceedings powers dependent on a political decision. This goes against the whole thrust of what we have been debating up to now, and we therefore cannot support the amendment.

Amendment 271B would exclude legislation, such as on family leave, unfair dismissals or redundancies, from the scope of this power. These issues can have a substantial impact on people’s working lives and they are part of the employment package. It is right that the fair work agency has the discretion to support enforcement in these areas and to ensure that employees get what they are entitled to.

Amendment 271C is unnecessary. The Bill already builds in appropriate safeguards to prevent cases being relitigated. In considering whether a worker will bring proceedings, the Secretary of State will have to consider whether a worker has already contacted ACAS. If they have, it would serve as a strong indicator that they are contemplating proceedings. Therefore, where a settlement is being discussed, or has already been reached through ACAS, it is highly unlikely that the Secretary of State would pursue a claim. This amendment would create a rigid prohibition that may have unintended consequences. The Government would be restricted from acting where new evidence shows that a settlement was reached under duress.

On Amendment 272ZA, tabled by the noble Lord, Lord Sharpe of Epsom, the Bill already makes it clear that any reference to a worker in proceedings brought by the Secretary of State should be read as including the Secretary of State. In practice, this means that, while it is for the tribunal to decide whether or not to award costs, a costs order could be made only in respect of a party to the case. This would be the Secretary of State, where they are the party that has brought this case. Therefore, this makes this amendment unnecessary.

On Amendment 272, tabled by the noble Baroness, Lady Noakes, in the worst cases of serious exploitation and intimidation, a worker may want to bring proceedings but fear the repercussions they may face from the employer should they be de-anonymised. Allowing the Secretary of State to take a case forward without consent would make it harder for employers to attribute blame to individual employees and also ensure that action could be taken against exploitation. Ultimately, I agree with the noble Baroness that this will take place only in exceptional circumstances, not least because it is more difficult to argue a case without the assistance of the worker. Nevertheless, where there is a breach of employment rights, there should be consequences. The fair work agency will decide the most appropriate route of enforcement, and it is important that in the most serious cases we allow this power as an option.

Finally, on the Amendments to Clause 114 from the noble Lord, Lord Jackson, the existing drafting of Clause 114 states:

“The Secretary of State may assist a person”.


This drafting was carefully thought through and is deliberately broad and inclusive. It includes both natural and legal persons, so it already covers both employers and their legal advisers. This amendment does not alter the substance of the clause, but merely restates what is already covered and therefore risks introducing confusion.

On the noble Lord’s Amendment 272C, Clause 114 has been carefully monitored against the provisions found in Section 28 of the Equality Act 2006, which also provides for any other form of assistance. This language has been used to ensure flexibility and inclusivity in the types of support that may be provided. This is neither novel nor excessive and is limited to assistance in the context of civil proceedings. To narrow the clause in the way this amendment does would compromise its effectiveness and undermine its accessibility. On that basis, I hope noble Lords will not pursue their amendments and I ask the noble Lord, Lord Sharpe, to withdraw his Amendment 267A.

[Lord Hunt of Wirral (Con)]

My Lords, I thank my noble friend Lady Noakes for providing an important guardrail: the idea that the Secretary of State has to pass a public interest test. I do not think the Minister gave us a direct answer to that suggestion. So far as my noble friends Lady Coffey and Lord Jackson of Peterborough are concerned, there are huge concerns about the way this will affect small businesses in particular. Again, I do not think the Minister addressed that particular point. I regret the fact that the Minister has not acknowledged the importance of these significant gaps in the Bill.

It is concerning that the challenges inherent in delegating the Secretary of State’s enforcement functions to others who may lack the necessary competence or accountability are not being fully recognised at the present time. How does such delegation genuinely serve the interests of workers if it risks inconsistent decision-making and a lack of clear responsibility?

Moreover, the Bill fails to address the very real issue of claims that have already been settled. Employment tribunals are already struggling with an overwhelming backlog, and reopening settled cases would only exacerbate this problem. Surely, we have got to avoid a situation where the Secretary of State is empowered to reopen disputes that workers and employers believed were finally resolved. This not only causes unnecessary anxiety and uncertainty for all parties involved but threatens to damage the fragile trust and relations between employers and employees. If this Bill is to be truly effective and fair, it has got to acknowledge these realities: —ignoring them will only undermine the very goals it seeks to achieve. In the meantime, I beg leave to withdraw the amendment.

Amendment 267A withdrawn.

Employment Rights Bill

Lord Hunt of Wirral Excerpts

Committee stage
Wednesday 18th June 2025 Lords Chamber

Moved by

[Lord Hunt of Wirral]

271ZZA: Clause 91, page 110, line 12, at end insert—
“with the three-year period resetting three months after any general election.”Member’s explanatory statement
This amendment seeks to ensure that a new government would not be held to the labour market enforcement strategy of a predecessor government for up to three years.

[Lord Hunt of Wirral (Con)]

My Lords, in moving Amendment 271ZZA, I will also speak to Amendments 274 and 278, standing in my name.

Clause 91 requires the Secretary of State to set out a plan for enforcing labour market legislation over a three-year period. However, as currently drafted, Clause 91 lacks the flexibility necessary to reflect changes in government and political leadership. As the Minister will be aware, Clause 91(1) places a statutory duty on the Secretary of State to publish a labour market enforcement strategy

“before the beginning of each relevant three-year period”.

Subsection (6) then defines those periods as

“beginning with the next 1 April after the day on which this section comes into force”

and every successive three years thereafter. At first glance, that may seem entirely sensible, but let me explain why it creates a democratic and practical problem that our amendment seeks to fix.

Suppose, for example, this Bill passes this year, in 2025. Under Clause 91(6)(a), the first strategy would need to be published before 1 April 2026 and it would then run until March 2029. Now, imagine a general election takes place in 2027—entirely plausible, perhaps even probable. That would mean that a new Government taking office in 2027 would be bound by a strategy formulated and published by a previous Administration, with potentially very different political priorities, until well into 2029. I suggest to the Government that this is neither democratic nor desirable.

Labour market enforcement is not a neutral administrative matter. It involves clear policy choices about which sectors to prioritise, what level of inspection and enforcement to undertake, what approach to take with non-compliant employers, and how to engage with trade unions, businesses, regulators and workers. These are not technocratic decisions. These are matters of political judgment. They ought to reflect the democratic mandate of the day.

Our amendment is, therefore, straightforward. It would insert into Clause 91(6) a provision that the relevant three-year period should reset three months after any general election. This would provide any new incoming Government with a short period—not an immediate obligation—in which to consult the advisory board and prepare a revised strategy, only if they wish to do so. It would not force a change of strategy; it would simply enable one at a more appropriate and timely moment.

Amendments 274 and 278 together seek to inject evidence, accountability and proportionality into the Government’s proposal to establish a single labour market enforcement body under this legislation. These are not abstract or procedural concerns; they speak directly to the credibility of this legislation and the consequences it will have for workers, businesses and the rule of law in the labour market. We are therefore being asked to approve a significant structural reform—the consolidation of multiple specialist enforcement agencies into a single, central body—without a clear estimate of how much it is all going to cost and without a rigorous analysis of whether it will improve enforcement outcomes.

The idea that such sweeping institutional change could proceed without a public, detailed cost-benefit analysis should give us all pause for thought. The creation of a new enforcement authority is not merely a matter of administrative reorganisation; it involves physical premises, staff transfers, IT infrastructure, the legal realignment of enforcement powers, data-sharing agreements, and the re-establishment of everything, from complaints mechanisms to enforcement protocols.

All of this will come at considerable financial and operational cost, yet no such cost has been published, nor can it be debated. It is absent. This is particularly concerning given that we have seen similar government reforms in other domains—such as the establishment and eventual dismantling of the UK Border Agency—go badly awry, not for lack of ambition but for lack of foresight and planning. An effective enforcement agency cannot simply be declared into being. It has to be built carefully, deliberately and on the basis of hard evidence.

That is why Amendment 274 requires the Secretary of State to lay before Parliament a detailed cost assessment. We understand that the Government’s broader agenda includes a desire to reduce inefficiency and waste in the public sector. That is a principle all sides of this Committee would support. We would not, and I hope the Minister would not, wish to see the creation of another bloated agency duplicating functions and budgets and wasting taxpayers’ money under the guise of reform. Without clear planning, the risk is precisely that a new bureaucracy, with vague lines of accountability, an unclear mandate and spiralling costs fails to deliver better outcomes for workers and businesses.

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[Lord Katz (Lab)]

We have had a fair amount of scrutiny of the wider proposal, rather than the Bill’s specific fair work agency proposals. As I said, over the past nine years since 2016, there have been 33 different strategies and reports, including—but certainly not limited to—the Taylor report. This is not an area that has not been considered and scrutinised to some degree. I also say to the noble Baroness that the Single Enforcement Body—as it was called by the previous Administration—was the policy of successive Conservative- led and Conservative Administrations. I am not going to intrude on the great policy disagreements on that side of the House. We feel it important to establish the fair work agency and to ensure that we have strong enforcement of labour market regulations. I therefore ask the noble Lord to withdraw Amendment 271ZZA.

[Lord Hunt of Wirral (Con)]

My Lords, this has been a very significant debate, because I believe it is the first time I have heard from the Government Front Bench an acceptance that the Opposition will eventually take over government again. He and I may disagree on when this will happen—of course we disagree: I just happen to believe that it is going to happen at the next general election. That is why these amendments are so important.

I also want to say how much we miss the noble Lord, Lord Fox. I was very disturbed indeed to hear about his unfortunate accident, but I am very pleased to hear that he may shortly be with us. I hope that, by speeding up the process to Report in July, he will still be able to be with us, because he has always brought a note of common sense—despite coming from the Liberal Democrat Benches. Now I am upsetting everyone. All I want to say to the noble Lord, Lord Goddard of Stockport, is that he has been a marvellous substitute, if one can say that. His pragmatic approach to the Bill has been enormously valuable, but we do miss the noble Lord, Lord Fox.

I thank my noble friend Lady Lawlor, who is quite right: we are moving into unknown territory. Although the Minister might remind us that the Conservative Government were committed to looking at stepping in this direction, we are still moving into unknown territory and, as my noble friend Lord Jackson of Peterborough pointed out, the CIPD cost estimates are really worrying. I do not think the Minister properly addressed his key question on the whole issue of accountability.

However, here we are. I am surprised that the Government have rejected Amendment 271ZZA. It is a reasonable and pragmatic amendment that simply recognises the basic democratic principle that a new Administration should have the ability to review and, if necessary, revise a labour market enforcement strategy to reflect new economic realities and public priorities. Despite the amendment to which he referred—which is at the margin—the Government have always insisted that a labour market enforcement strategy must run its full term without reset, regardless of elections or changes in government. But why should a new Government be bound by a strategic direction set by their predecessor? That is not consistent with the democratic mandate bestowed on any incoming Government. Surely it is neither logical nor democratic to compel a newly elected Government to implement a strategy they did not design, especially in a labour market that is dynamic and constantly evolving.

Economic landscapes can shift dramatically within short periods, whether due to international events, technological change or domestic challenges. Flexibility to adjust enforcement priorities accordingly is essential. It is not only a question of governance, but of ensuring that enforcement remains effective and responsive to current labour market conditions. The Government have already recognised the importance of periodic review and the resetting of the labour market enforcement strategy every three years, as set out in Clause 91. If I am not mistaken, that periodicity is built into the framework precisely to ensure that the strategy remains relevant and responsive.

The main feature of this debate has been the cogent arguments put forward by the noble Lord, Lord Goddard of Stockport. His insights, and those of my noble friend Lady Coffey, highlight the pressing need for a substantive independent review of the proposed fair work agency. While the promise of increased efficiency in enforcement is welcome, we must remember that there are intentions and then there are results. We must understand how such efficiency will be achieved and at what cost, what other alternatives were considered, and why they were rejected.

To date, the Government have not committed to publishing any specific details about the establishment of the fair work agency—details that are crucial for proper scrutiny. We lack clarity on the expected costs of this new body, the standards by which compliance will be measured and the criteria that will guide enforcement decisions. Without that transparency, it is difficult to assess whether the creation of this body will represent genuine progress or simply add another layer of bureaucracy, which, as the noble Lord, Lord Goddard of Stockport, stressed, will impinge on smaller businesses in particular.

There remains much to discuss and questions to be answered about the fair work agency. Unfortunately, I find myself unconvinced by the Government’s arguments against the amendments proposed by myself and the noble Lord, Lord Goddard of Stockport. Our proposals are not about obstruction but about ensuring proper oversight, accountability and flexibility in this important area of labour market governance. I am sure that we, and the Liberal Democrats, will return to these issues on Report, but for now, I beg leave to withdraw the amendment.

Amendment 271ZZA withdrawn.

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[Lord Hunt of Wirral (Con)]

My Lords, I will speak to Amendments 271ZC and 273BA but I first thank my noble friends Lord Jackson of Peterborough and Lady Coffey for their amendments. My noble friend Lord Jackson began by describing his amendments as a “cornucopia”. I was always told that a cornucopia was a goat’s horn overflowing with flowers, fruit and corn. A better definition than the one he used would be “an abundant supply of good things”, which opened the opportunity for the Minister to justify the unjustifiable. We all look forward to hearing from her.

Amendment 271ZC seeks to avoid governmental overreach by excluding holiday pay from notices of underpayment, given that the existing legal framework provides adequate remedy for individuals seeking to enforce their rights in this matter.

Amendment 273BA seeks to ensure that labour market enforcement undertakings are requested only when there is a public interest in doing so. This amendment provides an essential layer of protection against the risk of regulatory overreach and against the misuse of powers that could otherwise affect individuals and businesses unfairly. Clause 117 gives the Secretary of State considerable discretion to impose conditions on people or businesses suspected of labour market offences. That discretion already includes subjective tests of what is just and what is reasonable. Who defines what is reasonable? Who ensures that decisions are being made not just fairly but in service of the broader public good? By requiring measures to be in the public interest, as this amendment does, we would root enforcement action in its proper purpose: protecting workers, upholding lawful employment practices and maintaining public confidence in our regulatory system.

This amendment would strengthen the legitimacy of LME undertakings. It would ensure that measures are not only lawful and proportionate but meaningful, and that they serve society as a whole, whether it is tackling exploitation, improving transparency or deterring repeat offences. I believe the public interest must be front and centre. Without this safeguard, we risk opening the door to punitive, reputational or performative measures that may be justified in form but not in principle. This amendment would give Parliament, and more importantly the people affected, the confidence that LME undertakings will be guided by public value, not political expediency or administrative convenience. I urge the Government to support this amendment.

As I mentioned, I also support the amendments tabled by my noble friend Lord Jackson of Peterborough. His proposed changes to the wording of the legislation, particularly in relation to enforcement powers, are both thoughtful and necessary. By raising the evidential threshold from a simple belief to one requiring an evidential basis, and by increasing the standard of proof for courts from “the balance of probabilities” to “beyond reasonable doubt”, these amendments would introduce essential safeguards. They do not undermine the policy intention of the Bill to tackle labour market offences effectively. Rather, they ensure that enforcement actions are firmly grounded in evidence, and that the rights of employers and individuals are protected from potential overreach or misuse of power. In short, my noble friend’s amendments help strike the critical balance between robust enforcement and fairness, which I believe is vital for maintaining public confidence in the system.

Amendment 273PB, tabled by my noble friend Lord Jackson of Peterborough, is an incredibly important amendment. We live in a world where migration patterns are increasingly complex and the risks associated with illegal immigration, visa overstays and exploitation in our labour market are growing. At the same time, threats to our national security have become more sophisticated, requiring a co-ordinated and agile response across multiple agencies.

--- Later in debate ---

[Lord Jackson of Peterborough (Con)]

My Lords, I commend my noble friends’ excellent speeches on this clause. I press the Minister on what the Explanatory Notes say about subsection (4), because we have talked about the concept of persons and what that actually means. My noble friend spoke earlier about ministerial powers and the lack of information on costs, which should have been in a proper and more detailed impact assessment but is not. It is not in any supporting material, including the Labour Party manifesto for the general election. Presumably, the Minister will say that such information about the form and function of the clause will be developed in secondary legislation.

The sentence in the Explanatory Notes about subsection (4) is extraordinary, because it touches on what is potentially ultra vires and will certainly, I think, be subject to litigation or judicial review. Given that this is an Employment Rights Bill about labour relations and employment, it says:

“Subsection (4) makes provision for situations where proceedings relate partly to employment or trade union law … and partly to other matters”.


I just do not understand what those other matters can be. This is an employment law Bill. It is about labour relations and the relationships between employers, trade unions and a workforce. What other matters are within the bailiwick of Clause 114? I think we need to press the Minister on that, because we are being invited to give a blank cheque with taxpayers’ money to something that is very opaque, we do not understand, is not costed and is not detailed. On that basis, the Minister should address those specific issues.

[Lord Hunt of Wirral (Con)]

My Lords, I thank my noble friends Lady Coffey, Lady Noakes and Lord Jackson of Peterborough for some penetrating questions about the power to provide legal assistance as set out in Clause 114. First, I would like the Minister to share with us what discussions have been held with the Lord Chancellor and the Secretary of State for Justice. A number of the points made by my noble friends relate to the fact that legal aid is already available in certain circumstances, so what is this all about and, as my noble friend Lady Coffey asked, who is this going to benefit?

--- Later in debate ---

[Lord Katz (Lab)]

I do not want to disappoint the noble Lord, but I am afraid he is stuck with me again. I thank the noble Baroness, Lady Coffey, for tabling amendments on legal assistance and the noble Baroness, Lady Noakes, for notifying us of her opposition to Clause 114 standing part of the Bill.

I will start with Amendment 272BA. To be fair, the noble Baroness, Lady Coffey, and others indicated that this has overlapped with not only previous discussions today but discussions of groups on previous days in Committee. As my noble friend Lady Jones said on Monday, the drafting of Clause 114

“was carefully thought through and is deliberately broad and inclusive”.—[Official Report, 16/6/25; col. 1883.]

It is only fair that it covers not just employees but employers and trade unions. To answer a specific question from the noble Baroness, Lady Coffey, about what other assistance could be provided, this could include help in understanding procedural requirements, preparing documents or accessing expert input. It is designed to be flexible and responsive to individual needs. Given this, we cannot support Amendment 272BA.

Amendment 272D would restrict the amount of support that could be offered to any individual through this power. It is not a reasonable measure. I understand that it is a probing amendment, as the noble Baroness, Lady Coffey, said, but the small amount proposed in the amendment would leave the power meaningless. As we have discussed, this would be, although it is not intended as such, tantamount to a wrecking proposal, because it is such a small amount. Obviously, as we have discussed, this is a manifesto commitment. The fair work agency should be able to decide how much support it can offer, without being constrained to random financial limits for no good reason.

Amendment 272E would create an additional process before the power can be used. Part 5 of the Bill already calls for the fair work agency to publish an annual strategy, as we discussed on an earlier group. Requiring yet another administrative document in this way would be burdensome and unnecessary, and I think we share across the Committee a desire to reduce bloated bureaucracy—a phrase that has already been used this afternoon.

Turning to Amendment 272F, the powers under Clause 114 will operate in tandem with those in Clause 113, but workers will not always want to be separately represented in proceedings brought by the fair work agency. They can be represented, but they do not have to be. Therefore, we cannot support this amendment.

Amendment 272G would mean that the fair work agency would duplicate ACAS’s existing responsibilities regarding dispute resolution. This power is not intended to be a replacement or a duplication of existing support. We cannot support this amendment, as it would complicate the enforcement landscape when we are trying with this Bill to simplify it.

Amendment 272H would limit the scope of this power. It would create situations where legal assistance would have to cease, even if proceedings continued, leading to unfairness. It could lead to people being unable to continue their cases, which could cover other matters such as discrimination, because support could no longer be offered. The fair work agency should be able to decide what is appropriate and fair in each case.

Amendment 272I would put an unnecessary burden on the Secretary of State to have insurance in place before being able to provide advice on a settlement agreement. To be fair to the noble Baroness, Lady Coffey, she sort of indicated uncertainty around this. To be clear, this amendment wholly contradicts established government practice. I refer her to paragraph 4.4 of Managing Public Money, which sets out that the Government should generally not take out commercial insurance and it is not good value for money.

To summarise on Clause 114, the legal system can be intimidating, particularly for vulnerable workers or those from marginalised backgrounds. To repeat what my noble friend Lady Jones said in the previous group, many vulnerable workers are reluctant or unable to bring their cases to tribunal to enforce their employment rights, and this has serious consequences. Rogue employers exploit this, breaking employment law, and get away with it. For instance, Citizens Advice suggests that high-paid workers are more likely to file a case with an employment tribunal than lower-paid individuals, despite the latter being more likely to have their rights infringed. As I said, this lets rogue employers off the hook, and that is unfair for the vast majority of businesses, which we all know do the right thing by their staff and want to. It is unfair for the vulnerable workers involved—to state the obvious—who are being denied their rights, and it is unfair for the rest of the workforce, who are denied work opportunities due to illegal practices undercutting them.

As was said in the last group, that is why, in the plan to make work pay—again, a manifesto commitment—we set out that the fair work agency will have powers to bring civil proceedings to uphold employment rights. The Bill will give the fair work agency the power to bring civil proceedings in the employment tribunal to uphold rights. This is a critical power, particularly for situations where a worker feels unable to bring proceedings themselves. But there are occasions where a person is able to bring proceedings in the tribunal or another court but needs assistance, or where the case has wider ramifications and the person concerned could benefit from the fair work agency’s expertise.

[Lord Hunt of Wirral (Con)]

My Lords, can the Minister remind us to what extent there has been consultation with the Secretary of State for Justice? Has the Lord Chancellor been involved in putting together this scheme, which is going to sit alongside legal aid, for which she is responsible? It would be really helpful if the Minister could make sure that the Government is joined-up in putting forward what is, in a way, as my noble friends have pointed out, quite a blank cheque, which has not properly been costed. Can he put us right on all this, please?

[Lord Katz (Lab)]

I am more than happy to. The noble Lord, Lord Hunt, anticipates the comments that I was just about to come to—but we can address the point now. The noble Lord, Lord Jackson of Peterborough, focused on this as well. This is not expanding legal aid. The power is intended to give the fair work agency a discretion to provide support in employment-related cases. It is not an alternative to legal aid and it will be used in specific cases. The Government will set out how and when the fair work agency will exercise its power in due course and will discuss this with a range of stakeholders. I reassure the noble Lord, Lord Hunt, we have regular conversations with the Ministry of Justice, including on the Bill’s implementation.

I return to what I was saying about the importance of ensuring that the power of legal advice is appropriately bounded. It cannot be used to fund dispute resolution facilities delivered through other routes. Importantly, the clause protects the integrity of the courts and tribunals by confirming that nothing in the clause overrides existing restrictions on representation imposed by legislation or judicial practice. This clause complements the fair work agency’s wider role in promoting access to justice and fair treatment in the workplace. It provides a vital lever for supporting individuals who might otherwise face legal barriers alone or for ensuring compliance with relevant law, and it delivers our manifesto commitment on which Members in the other House were elected.

The noble Baroness, Lady Noakes, asked about the costs. These will be set out in due course and will be discussed with a range of stakeholders, particularly employers, trade unions and employees.

--- Later in debate ---

[Baroness Coffey (Con)]

My Lords, I am conscious of the sentiments expressed here, but it would put the Government and the Secretary of State in a very difficult legal situation if they were to hold information that they were not allowed to pass on to relevant authorities within the rest of government. I hear what the noble Baronesses have said, but I do not know, with all the other rights that are starting to come through this Bill, why anyone should be afeared, especially when they are here on a legitimate visa as in the example to which the noble Baroness, Lady O’Grady of Upper Holloway, has just referred. I am conscious of some of the exploitation, but I believe that same sponsor was suspended from sponsoring any more visas. I was not aware of what the Home Office did or did not do, but restricting the Secretary of State from formally upholding the law is quite a worrying trend.

[Lord Hunt of Wirral (Con)]

My Lords, I thank the noble Baroness, Lady Hamwee, whom I had the honour to serve when she chaired the Home Affairs Select Committee. She has raised a number of key points, as has the noble Lord, Lord Paddick, and I thank the noble Baroness, Lady O’Grady of Upper Holloway, and my noble friend Lady Coffey for their speeches as well.

Let me make it absolutely clear: modern slavery remains one of the gravest human rights abuses of our time, and tackling it requires vigilance, clarity and effective enforcement. It is crucial that the agencies tasked with identifying and assisting survivors and with co-operating closely with the Independent Anti-Slavery Commissioner have clear mandates and necessary powers to act decisively. While the specific amendments before us seek to clarify the transfer of roles from the Gangmasters and Labour Abuse Authority to the fair work agency, the wider point is this.

Enforcement bodies must be both effective and well co-ordinated to respond to the complexities of modern slavery. Without this, vulnerable individuals risk slipping through the cracks, and the machinery of justice and protection loses its impact. Ensuring transparency about which bodies are responsible for what and guaranteeing that they are properly equipped underpins our broader commitment to eradicating modern slavery. It is not just about legal technicalities but about safeguarding human dignity and upholding fundamental rights.

Employment Rights Bill

Lord Hunt of Wirral Excerpts

Committee stage
Wednesday 18th June 2025 Lords Chamber

[Lord Hunt of Wirral (Con)]

My Lords, I thank my noble friend Lady Coffey for her amendment. She raises thoughtful and important questions about Parliament’s role as an employer and the complexity of managing the site, which contains over 600 other employers. These are legitimate concerns that deserve proper consideration, not least because Parliament should seek to model best practice in matters of employment and compliance. I think we all agree with that, but does it comply, and should there be a power of entry into these premises to check that we are complying?

My noble friend has made compelling points, and I hope that the Minister will respond with clarity and detail. The concerns that my noble friend outlined are not theoretical; they touch on the credibility of this institution as both lawmaker and employer. I therefore look forward to hearing the Minister’s response and the Government's justification for retaining—or reconsidering—the exemption as drafted.

[The Parliamentary Under-Secretary of State, Department for Business and Trade and Department for Science, Information and Technology (Baroness Jones of Whitchurch) (Lab)]

My Lords, I thank the noble Baroness, Lady Coffey, for her amendment, which raises an important topic: how the enforcement provisions in Part 5 would apply to Parliament and MPs as employers.

Parliament must of course comply with employment legislation. However, the Bill provides that the powers of entry in Part 5 cannot be exercised in relation to

“premises occupied for the purposes of either House of Parliament”;

otherwise, Part 5 would apply to both Houses of Parliament and to MPs as employers. We are in danger of having something similar to—but slightly less than—a deep constitutional crisis, because the approach was agreed on the advice of the House authorities. It is therefore not a government decision; it is a decision made by the House authorities. They are more powerful, as far as I can see, and they can therefore overrule what the Government may think about all this.

This approach is not unusual. It aligns with recent precedents, such as Section 165(1)(a) of the Building Safety Act 2022, to respect parliamentary privilege. In this case, Parliament has to comply with employment legislation. The only issue raised here is about the power of entry not applying to the Parliamentary Estate. The noble Baroness might understand why we want to make sure that the Parliamentary Estate is secure from that challenge, and there is probably another place where she could raise her concerns about employment in the Parliamentary Estate. I have some sympathy with some of the cases that she argued about, but I suggest that she sees the House authorities about them. I therefore ask the noble Baroness to withdraw her amendment.

--- Later in debate ---

Moved by

[Lord Hunt of Wirral]

279GA: Clause 149, page 147, line 16, at end insert—
“(2) Subject to subsection (3), this section is repealed three years after the day on which it comes into force.(3) The Secretary of State may, following a full independent review of the operational impact of the section on tribunal efficiency and access to justice, by regulations made by statutory instrument provide that the provisions of this section are not repealed in accordance with this section but shall continue in force indefinitely.(4) The regulations in subsection (3) are subject to the affirmative resolution procedure.”Member's explanatory statement
This amendment introduces a sunset clause to ensure that the extension of time limits for bringing employment tribunal claims is subject to periodic parliamentary oversight.

[Lord Hunt of Wirral (Con)]

My Lords, Amendment 279GA would introduce a sunset clause to ensure that the extension of time limits for bringing employment tribunal claims is subject to periodic parliamentary oversight. I will speak also to Amendments 330ZA, 330D and 334A in my name.

I have tabled these amendments along with my noble friend Lord Sharpe of Epsom because I believe that the state of the employment tribunal system is deeply concerning and urgently requires our attention. The proposals before us introduce a range of new rights for workers, including the critical right to claim unfair dismissal from day one of employment. We must therefore confront the uncomfortable truth that the current tribunal system is simply not prepared to handle the additional burden that this Bill will place upon it. Indeed, we have heard from a respected law firm that there is broad consensus among legal professionals that the employment tribunal system is, in its words, the “biggest problem in the legal world”.

The Government’s own impact assessment suggests that tribunal cases will increase by around 15% as a result of these reforms, yet I must ask how this figure has been calculated. Given the scale of the backlog we are currently witnessing, can this be anything other than a gross underestimate? The reality is that, by extending the time limits within which individuals can bring claims, the Bill itself may actively incentivise an increase in the volume of cases. If people have more time to bring claims, it is only natural that more claims will be submitted—claims that must then be processed by a system that is already groaning under enormous pressure.

To put this in perspective, we are currently facing, we are told, an employment tribunal backlog of nearly 50,000 cases. This backlog has now reached record levels, with preliminary hearings being scheduled as far away as April 2026, and full hearings not likely to take place until well into 2027. This must be a crisis. A delay of this magnitude means that justice for many is effectively denied. When someone has to wait years for their case to be heard, the protection that the law is supposed to afford becomes little more than an empty promise.

The causes of this backlog are clear. There is an acute shortage of employment judges. There is insufficient funding. There is inadequate administrative support. Although the Government have pledged to recruit hundreds of new judges, the practicalities of ensuring that those judges have the necessary expertise and that adequate administrative support is in place remain significant challenges.

That is why I believe these amendments are vital. They do not seek to block or delay the introduction of important workers’ rights, but they instead insist on responsible, measured implementation. It is essential that before these new rights come into force an independent and thorough assessment is conducted to evaluate the capacity and effectiveness of the tribunal system. This assessment has to address current delays, judge numbers, funding and the likely impact of this Bill’s provisions on tribunal caseloads. Moreover, the Government must commit to implementing all necessary measures identified in this assessment to reduce the backlog to a manageable level, specifically to fewer than 10,000 outstanding claims. Only then should these rights be activated.

This is all about ensuring that, when workers exercise their rights, they have access to a tribunal system capable of delivering timely, fair justice. Additionally, the amendment regarding the extension of time limits for claims rightly insists that this measure cannot come into effect until the Senior President of Tribunals certifies that the system can handle the expected increase in cases without further lengthening hearing times. Without such a safeguard, we risk compounding the problem and turning an already overstretched system into something unworkable.

There is another important point that I must raise. Nowhere in the Government’s impact assessment is there any explanation of why the option of introducing a right to claim unfair dismissal between day one and two years was not considered. If the intention is truly to balance the employment relationship and provide fair protections, why do we have to leap to day one? This decision is not just a legal technicality; it carries real risks. One such risk is the disincentive it creates for employers to hire workers who may be perceived as risky or less secure in the labour market—such as individuals with a history of mental health challenges, younger workers or others on the margins of employment —by exposing employers to potential unfair dismissal claims from the very first day. This Bill may inadvertently make it even harder for these vulnerable groups to find work in the first place. This would be a tragic and unintended consequence, compounding insecurity rather than alleviating it.

We have debated at length the potentially vast powers of the new fair work agency, its funding and the role it might play. However, many questions remain. Will the fair work agency with its undefined enforcement officers and unclear operational framework genuinely take on the enforcement of workers’ rights in a way that meaningfully reduces the burden on the already overstretched employment tribunals? Or will tribunals continue to bear the brunt of this increased workload without adequate support or relief?

I now look to the Government to provide this House, workers, businesses, law firms, and no doubt the tribunals with some assurance, clarity and ideally a timeline for the day-one rights provisions in this Bill. Perhaps this is the moment when the Minister will at last share with us, at least in draft, the implementation plan that we have heard so much about during the course of this Committee. Will she please undertake to ensure that we have the implementation plan before we reach Report?

[Baroness Lawlor (Con)]

My Lords, I support Amendment 279GA for a sunset clause. I perfectly understand the reason for extending the period in which employees can make claims, but I am quite sure it will increase the burden on the tribunals. We have heard about the very long delay, with even preliminary hearings not scheduled until April 2026, and these delays have continued for some years. People going to tribunal sometimes have to wait more than 18 months just to have the preliminary hearing. If numbers increase, as they are likely to, as my noble friend suggested, it is going to put far more pressure on the tribunals. The parliamentary oversight proposed and the sunset clause must take account of that.

Not only is there no point in law in having a claim left unsettled for years, but it is very bad for business to have the uncertainty. It is very bad for employees and their lives to be subject to such delays and uncertainties in what is going to happen to them professionally, because taking a claim to tribunal is not an easy matter. It can be expensive and full of obstacles. Not knowing how it will pan out is very worrying for people. For businesses, being subject to constant pressures of claims in a tribunal, whether they are justified or not, brings insecurity and a lack of confidence.

For these reasons, I think this moderate request for a sunset clause and coming back to Parliament for an affirmative vote are a good proposal, and I hope the Government will listen kindly to it.

--- Later in debate ---

[Baroness Jones of Whitchurch (Lab)]

My Lords, 50 new fee-paid employment judges were appointed in 2024-25, and a further three recruitment exercises to further increase capacity are now being undertaken in 2025-26.

[Lord Hunt of Wirral (Con)]

My Lords, I am very grateful to my noble friend Lady Lawlor for putting all this in the context of the security or insecurity of workers right across the board faced with this terrible backlog. The Minister upbraided me for the previous Government’s culpability in this, but she will know that we have been expressing serious concern about this backlog for a very long time. The fact is that it has got worse: it is 20% up on what it was when the Government came into office last year. The Minister was quite right to say there was a backlog, but my plea to her is not to make it worse.

As we draw this debate to a close, I worry that the Government have not fully grasped the critical importance of these amendments. They are not obstacles to progress but necessary safeguards to ensure that the rights we are creating are not rendered ineffective by an overwhelmed tribunal system. We urgently need clarity on the implementation plans.

The Minister promised that we would have the implementation plan “shortly”. The definition of “shortly” is “within the next hour or so”. In the dictionary, we are told that shortly means that something is about to happen. So where is it? I would like to believe that the noble Baroness’s reference to the word, which she must have carefully considered, means that tomorrow we will get it. I am very happy for her to interrupt me if I am incorrect—perhaps she could clarify.

[Baroness Jones of Whitchurch (Lab)]

I was trying to be helpful to the noble Lord, but since he provokes me, I will simply say that I have used my interpretation of “shortly”, rather than the dictionary definition. It will not be happening in the next hour, I can assure the noble Lord of that.

[Lord Hunt of Wirral (Con)]

Could I possibly have a copy of the noble Baroness’s dictionary? She has just quoted from her dictionary, but sadly I do not have it to hand. We would all like to see the implementation plan, so please can we, if possible, before our next day in Committee next Tuesday?

There are all sorts of issues we have discussed that have not been answered. Why a measured approach between day one and two years? Was it ever seriously considered? There has been no answer from the noble Baroness on that. Did she look at it or did she move straight to day one? The gap in reasoning leaves many of us deeply worried about the unintended consequences for workers and employers alike. Regrettably, these are crucial issues which remain unresolved, and the Government have yet to provide the assurances we need. As we approach Report, we will have to return to this matter with a determination to secure the clarity and commitments that are so essential if the Bill is ever to be successful. I beg leave to withdraw the amendment.

Amendment 279GA withdrawn.

--- Later in debate ---

[Baroness Penn (Con)]

My Lords, Amendment 280 is designed to address the use of substitution clauses that allow for illegal working. There are different ways of measuring it, but on some estimates there are 4.7 million gig economy workers in the UK, including around 120,000 official riders at Uber Eats and Deliveroo, two of the largest delivery companies in the country.

For years we have heard stories of labour market fraud and visa abuse committed by contractors related to those companies, and much of that abuse has come through the legal loophole created by substitution clauses. These clauses have traditionally been used to give flexibility to businesses, but in the gig economy they are being used to allow illegal working. From late 2018 to early 2019 there were 14,000 fraudulent Uber journeys, according to Transport for London. During random checks two years ago, the Home Office found that two in five delivery riders who were stopped were working illegally.

I acknowledge that some action is being taken that will address part of this issue. Ministers have said that they will consult on employment status and moving towards a two-part legal framework that identifies people who are genuinely self-employed. I support that ambition, but as someone who worked on the original proposals in this area that stemmed from the Taylor review, I also understand the complexity of resolving this, and I fear that it could end up being put in the “too difficult” pile in Ministers’ in-trays.

The Government have also brought forward amendments to the borders and immigration Bill to include a legal requirement for organisations to carry out right-to-work checks on individuals they employ under a worker’s contract or as individual subcontractors, and for online matching services that provide details of service providers to potential clients or customers for remuneration. What are the timescales for the consultation and the secondary legislation to bring those measures into force? On my understanding, these provisions will not extend to the use of substitutes, meaning that this loophole will remain.

Amendment 280 seeks to go some way to addressing this through the introduction of a comprehensive register of all dependent contractors. Such transparency would help to ensure that employment rights are upheld and pay is not suppressed through illegitimate competition, and would also support the enforcement of right-to-work checks. An alternative approach would be to ban substitution clauses altogether, or at least for those companies and sectors where abuse is the most prevalent—or, as Amendment 323E in a later group from the noble Lord, Lord Berkeley, seeks to do, restrict their improper use.

Given that substitution clauses have played an important part in case law on determining employee or worker status, this could have broader implications, so I have focused on transparency as a first step. But I would be interested to hear the Minister’s view on removing or restricting the use of substitution clauses and whether that is preferable to a register delivering transparency, for example.

A further alternative would be to introduce right-to-work checks for substitutes by the original engaging business. While this was deemed to be out of scope for this Bill in the Commons, I had hoped that the Government’s amendments to the borders Bill would fill this gap. However, unless I have misunderstood—I would be grateful if the Minister can clarify this for me—their approach leaves this loophole untouched. The impact assessment for the Government’s amendments to the borders and immigration Bill reflects the harms that illegal working has on our economy. It says:

“Illegal working creates unfair competition, negatively impacts legitimate businesses, and puts additional pressure on public services. A rapid growth has been observed in the UK in modern labour market models where businesses can currently engage workers without the requirement to complete right to work checks”.


Without further action to address the abuse of substitution clauses, as the App Drivers and Couriers Union has said:

“Unfortunately there is this loophole that allows some bad people to come through. They are not vetted so they could do anything”.


The Government need to take action to guarantee fairness and justice in our labour market. A register of dependent contractors provides a way to resolve this abuse and hold big employers in the gig economy to account. I beg to move.

[Lord Hunt of Wirral (Con)]

My Lords, I congratulate my noble friend Lady Penn on tabling this important amendment. The requirement for certain company directors to maintain and report a register of dependent contractors under substitution clauses is a measure that would bring much-needed transparency to a complex area of employment. It recognises the evolving nature of work arrangements in sectors such as courier services and taxi operations. Of course, there are compliance burdens associated with maintaining such registers, especially for large companies operating over multiple jurisdictions. Additionally, data protection considerations must be carefully addressed to ensure sensitive personal information is handled appropriately and securely. These are important factors that require careful balancing against the benefits of increased transparency. We look forward to hearing the Minister’s response.

[Lord Leong (Lab)]

My Lords, I thank the noble Baroness, Lady Penn, for her Amendment 280 and for meeting with my noble friend Lady Jones and me last month to discuss this very important issue.

I reassure the noble Baroness that the Government are already taking action to tackle the main risks that arise from substitution, including illegal working. As she mentioned, substitution is a complex area on which we are still gathering data.

An ONS online survey of around 10,000 businesses from across the UK, published this month, found that close to 3% of UK businesses use substitution clauses. While we do not know the number of substitution clauses used in the gig economy, we know that this could impact a large number of individuals. Although estimates of the number of gig economy workers vary vastly in various surveys, from around 500,000 to 4.4 million people—the noble Baroness mentioned some 4.7 million people—the CIPD finds that roughly 75% of those in the gig economy consider themselves to be self-employed.

We have introduced an amendment to the Border Security, Asylum and Immigration Bill, as was mentioned by the noble Baroness, to extend the scope of employers required to carry out right-to-work checks to those who engage limb (b) workers or individual sub-contractors, such as those working in the gig economy. This requirement will cover those working as substitutes.

We understand the complexity of these issues, and of employment status more widely, and that is why we have committed to consult in detail on a simpler framework for employment status. Comprehensive consultation will better account for the full range of today’s employment relationships, while addressing the minority of employers who will seek to avoid legal obligations.

We were clear that some reforms in our plan to make work pay will take longer to undertake and implement. We do not have a set timeline for consulting on employment status at this point, and I assure the noble Baroness that we will keep her up to date as and when this happens. We understand the complexity of employment status, as I mentioned earlier, and we are definitely committed to consulting in detail. Comprehensive consultation will better accounts for the full range of today’s employment relationships, while also addressing the minority of employers who will seek to avoid legal obligations, as I mentioned.

The noble Baroness’s amendment would create significant additional reporting burdens for businesses and would not necessarily change how those businesses use substitution clauses, as I mentioned in my earlier speech. I therefore ask the noble Baroness, Lady Penn, to withdraw Amendment 280.

Employment Rights Bill

Lord Hunt of Wirral Excerpts

Committee stage
Tuesday 24th June 2025 Lords Chamber

Moved by

[Lord Hunt of Wirral]

310: After Clause 150, insert the following new Clause—
“Impact on new business entrantsThe Secretary of State must, within 12 months of the day on which this Act is passed and annually thereafter, publish an independent assessment of how this Act affects new business entrants and small start-up enterprises, particularly regarding the impact of increased administrative or financial burdens on market entry and growth.”

[Lord Hunt of Wirral (Con)]

My Lords, I shall speak to amendments 310, 311, 312 and 319.

If I may start with Amendment 311, I stress that productivity is vital for growth. The Government’s own impact assessment of the Bill is lacking in many areas, but it correctly identifies productivity as a problem in the UK workforce and reveals the fundamental weakness of their approach. They state quite explicitly:

“there is little quantitative evidence about the knock-on impacts on productivity”,

and conclude:

“On balance, we believe the impact on growth could be positive … but the direct impact would be small in magnitude”.


Most tellingly, they admit that

“the impact on average productivity will be small”.

To paraphrase, the Government seemingly admit that productivity will not be significantly improved, if at all, by this legislation. This raises a fundamental question that goes to the heart of economic policy: how does one achieve high levels of productivity?

High productivity emerges through competition—genuine, unfettered competition—where businesses face lower regulatory burdens, can compete effectively for the best workers and possess the freedom and flexibility to innovate, to adapt and to respond to market signals. Productivity growth stems from technological innovation, capital accumulation and, as we have just heard in the questions on the previous Statement, investment in skills and productivity—skills above all. These improvements occur naturally when markets are allowed to function, when competitive pressures incentivise businesses to innovate or perish and when the price mechanism can operate without distortion.

Competition drives productivity by creating what economists call “creative destruction”—the process whereby inefficient firms are displaced by more productive ones. When businesses have to compete for workers, they invest in training, technology and better working conditions. When they have to compete for customers, they innovate and improve efficiency. When they must compete for capital, they demonstrate their productivity gains to investors and offer competitive returns.

So what will this legislation achieve in practice? I regret that it will impose additional regulation, create additional burdens and constrain the very competitive forces that drive productivity improvements. This of course comes on top of the tax rises announced by the Chancellor—measures that undoubtedly constrain business investment and growth. The increase in national insurance contributions is particularly damaging in this context. Higher employer NICs directly squeeze the possibility of productive investment. Investment that would otherwise create jobs in productive areas of the economy will now not take place. Capital that could have been deployed to improve productivity, whether through new technology, training programmes or research and development, will instead have to be diverted to meet higher tax obligations and burdens. This represents a fundamental misunderstanding of how productivity improvements occur. Productivity does not increase through regulatory mandate or government directive; it increases when businesses have the freedom, the incentive and the resources to invest in productivity-enhancing activities.

This brings me to Amendment 319 and what I can only describe as a profound contradiction in government policy. The Government committed just months ago to a 25% cut in the regulatory burden. They reaffirmed this, as we heard, in the published industrial strategy. Yet here we have legislation that introduces what can only be described as a raft of new regulatory burdens. The question that demands an answer is this: how will the Government achieve this 25% reduction in the regulatory burden? How will it be measured? How will the Bill, which manifestly increases regulatory compliance costs, align with that stated target?

I turn to Amendment 310. A truly competitive market must make it simpler, not harder, for new businesses to enter. Yet there is no consideration in the Government’s impact assessment for how this legislation affects barriers to entry. I believe that this represents a profound oversight because, when businesses cannot enter a market because of costs imposed by government regulation, that fundamentally alters the competitive dynamics driving productivity improvements. The economic logic here is straightforward but crucial: when entry barriers are low, existing businesses face constant competitive pressure from potential new entrants. This pressure has to keep them on their toes, forcing them to remain productive, innovative and responsive to consumer needs. They cannot afford to become complacent because they know that more efficient competitors could emerge at any time, hot on their heels and full of competitive energy. But when government policy raises the cost of market entry through complex regulations, compliance burdens or increased operational costs, it can effectively insulate existing businesses from this competitive pressure. The result is predictable: established firms have less incentive to innovate, less pressure to improve productivity and less need to compete aggressively for the best workers.

Turning to Amendment 312, I come to a particularly important point about wage competition. In a competitive market, businesses compete not only for customers but also for workers. When entry barriers are low and competition is fierce, employers must offer competitive wages and working conditions to attract and retain talent. This competitive pressure naturally drives wages upward as businesses bid for the best employees. When regulatory burdens prevent new businesses from entering the market, however, this wage competition diminishes significantly. Existing employers face less pressure to offer competitive wages because workers have fewer alternative employment opportunities. The reduced threat of labour mobility gives established businesses greater power in wage negotiations.

I believe that the costs imposed by this Bill will exacerbate this problem in two distinct ways. First, the direct compliance costs and increase in employer national insurance contributions will pressure businesses to control their wage costs more tightly. Secondly, and perhaps more importantly, these costs will deter new business formation, reducing the competitive pressure that would otherwise drive wages upward. Of course, the Government may want to point to the increase in the minimum wage as evidence of their commitment to higher wages, but that misses the fundamental point about how competitive markets operate in practice. The minimum wage affects only a small proportion of the workforce—those at the very bottom of wage distribution; for the vast majority of workers, wages are determined by market forces and competition between employers for their services.

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[Lord Leong (Lab)]

I thank the noble Baroness for giving me the opportunity to say this again. In the first quarter of 2025, the UK saw 90,000 businesses created. Business creation was up by 2.8% over last year, while business closures fell by 4.4%.

[Lord Hunt of Wirral (Con)]

My Lords, this has been such an important debate. We have been throwing statistics around the Chamber as if they had just been invented. The very latest statistic that I have in front of me, published in Business Matters, is that:

“Britain has recorded its highest number of company closures for two decades, with the final quarter of 2024 seeing 198,046 businesses struck off the official register”.


That is hot from the press. We have really been debating—

[Lord Leong (Lab)]

My Lords, I must challenge the noble Lord. There are many reasons for business closures. Companies get struck off for all kinds of reasons. Unless we drill deep down into what that figure is comprised of and whether the reasons are insolvency or companies being dormant, it will be difficult just throwing figures around.

[Lord Hunt of Wirral (Con)]

Is that not exactly why we need to measure the impact? That is what this debate has been all about. The Minister has done my job for me, but he has not accepted any of the amendments.

I thank my noble friend Lady Lawlor very much indeed, not only for the facts and figures that she gave us but for how she stressed that there has been, is perceived to be and is taking place an increase in the regulatory burden. Looking ahead, there are more compliance costs to come. Why does the Minister not accept that there is a need for an independent impartial measure? That is what these amendments seek. My noble friend Lord Deben, with all his unrivalled experience in building up businesses, is arguing that we need to check, to look ahead and to ensure that we can measure the impact of this legislation. Who is going to be right? The Government are saying, “Trust us, we’re right, we know what’s best, this will increase growth”. Yet their own impact assessment says that it will not.

Therefore, when you analyse all the facts and statistics that are coming forward, surely there is a very strong argument that we need an independent impact assessment. I agree with my noble friend Lady Verma that, if our roles were reversed and the Minister, with all his experience, was sitting on this side of the House, these are the amendments that he would be pressing for, because he knows how important it is to measure the impact of legislation and regulation. The noble Baroness, Lady Fox of Buckley, spoke of measuring what is happening now against what the Prime Minister promised in cutting the amount of regulatory burden and reversing the managed decline. It was good that she reminded us of those key words. Yet, as she said, this legislation is jam-packed with regulation. Her warning that this legislation is a recipe for lawfare is a warning to us all.

I agree with my noble friend Lord Swire that there is a need for a low regulatory framework at a time when our competitors are embracing artificial intelligence and all the new techniques while we are increasing the regulatory burden. I do not think that the noble Lord, Lord Palmer, got the answer that he was looking for from the Minister. Although he may not agree specifically with each individual amendment, he does believe that there is a clear message here that we must take on board.

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[Lord Monks (Lab)]

I was just sitting here looking at the noble Lord, a member of Mrs Thatcher’s Cabinet, with another one over there, the noble Lord, Lord Deben. When they passed a major piece of legislation, were there were any cases where you went to Mrs Thatcher and said, “Can we have an independent assessment of whether we have done the right thing?” I cannot remember anybody ever doing that, but perhaps the noble Lord can tell me otherwise.

[Lord Hunt of Wirral (Con)]

I have many, many—

[Lord Deben (Con)]

Can the noble Lord, Lord Monks, mention any occasion on which the Official Opposition of the time demanded it?

[Lord Hunt of Wirral (Con)]

My noble friend is quite right. I was going to make a rejoinder by demonstrating that, with Margaret Thatcher assessing, when you proposed a piece of legislation, you had to make sure that you had done your homework and carried out every possible impact assessment, as you would be closely cross-examined on each and every piece of legislation. I worry that this Bill has been rushed through in the first 100 days and no one has carried out the sort of test that Margaret Thatcher would have imposed. Therefore, I am so grateful to the noble Lord, Lord Monks, for reminding us of that criterion, which we ought to bear in mind.

[Lord Watson of Wyre Forest (Lab)]

The noble Lord has lured me into asking a question about impact assessments and the historic impact of the Thatcher Government. Which impact assessment said that there was a legislative decision made incorrectly during that period?

[Lord Hunt of Wirral (Con)]

We were subject to parliamentary scrutiny each and every day of the 18 years that we were in power. It was good that this accountability to Parliament was treasured by those in Parliament. However, I worry, certainly so far as secondary legislation. The noble Lord served with me on the Secondary Legislation Scrutiny Committee and joined with me in saying, “Please let us make sure that every piece of legislation that we pass has a proper impact assessment”. Perhaps we learn from history that it is vitally important to have that impact assessment always ready there to prove, as my noble friend Lord Deben put it, whether we have got it right or wrong.

I worry that this Government have not done their homework. The fact that they resist these amendments suggests that the cut in regulatory burdens is not going to be pursued with any real determination. That 25% target is destined to remain a headline-grabbing announcement that quietly disappears when submerged under the reality of real-life policy choices. I hope that the Government reconsider, because these issues will come up over the next few years of this Government. For now, I beg leave to withdraw the amendment.

Amendment 310 withdrawn.

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[Lord Carter of Haslemere (CB)]

My Lords, I will speak to Amendment 326 in this group. I begin by saying again how gracious it was of the Minister to meet me to discuss my amendments in advance a couple of weeks or so ago. My Amendment 326 is on the same theme of the need for impact assessments before provisions are brought into force. It provides that:

“Regulations which would amend primary legislation may not be laid … unless an assessment of the impact … has been laid before Parliament and three months has elapsed”


from that date.

Delegated powers that can amend primary legislation are, of course, known as Henry VIII powers. This derives from the Statute of Proclamations in 1539 when Henry VIII persuaded the Commons to include a provision in a Bill that would permit him to issue decrees having the same effect as an Act of Parliament and thereby bypass the normal parliamentary process.

Henry VIII powers can be draconian and raise real questions as regards compliance with the rule of law. This is not just my view. In his much-lauded Bingham lecture on 14 October 2024, entitled “The Rule of Law in an Age of Populism”, the noble and learned Lord, Lord Hermer, the Attorney-General, was obviously right when he said that excessive reliance on delegated powers, including Henry VIII clauses

“upsets the proper balance between Parliament and the Executive. This not only strikes at the rule of law ... but also at the cardinal principles of accessibility and legal certainty”—

issues that

“raise real questions about how we are governed”.

These are wise words indeed and very welcome, but I find it difficult to reconcile them with our Bill. As the noble Lord, Lord Hunt, pointed out at Second Reading, there are around 163 delegated powers in our Bill and 12 Henry VIII powers. As he powerfully put it:

“Ministers are, in effect, asking Parliament today to empower them to do whatever they decide to do, whenever they decide to do it”.—[Official Report, 27/3/25; col. 1845.]


The Delegated Powers and Regulatory Reform Committee, in its report of 24 April, described various Henry VIII powers in the Bill as, “overly broad”, “inadequately justified”, and an

“inappropriate use of the … affirmative process”.

As it said, Henry VIII powers are subject to far less scrutiny than primary legislation.

And this is the heart of the problem. Much of the legislation needed is yet to come, but it will not be capable of being scrutinised as it should be because of the reliance on Henry VIII clauses. It is a symptom of a rushed agenda but also, more worryingly, of a growing acceptance that Henry VIII powers are okay. They are becoming the default option.

The Select Committee on the Constitution, in its report, points out that Clause 24, “Dismissal during pregnancy”, and Clause 25, “Dismissal following period of statutory family leave”, both

“contain and extend Henry VIII powers that … act as placeholders while the Government consults further on the specifics of the measures to be implemented”.

This can mean only that

“substantive policy decisions have not yet been taken”

on those issues. But it also means a lack of certainty about how the provisions will operate in practice, which the Select Committee-considered to be “particularly concerning”, given that the provisions enable primary legislation to be modified.

In addition, Schedule 7 contains a list of extensive legislative powers in connection with labour market enforcement, under Part 5, which are passing to the Secretary of State. Paragraph 35 confers on the Secretary of State a Henry VIII power to add by regulations any enactment which affects the rights of employees, trade unions and the duties of employers.

These extensive enforcement powers in Part 5 also need to be considered alongside Clauses 151 and 153. These clauses contain a power to make any consequential provision, which may amend, repeal, revoke or otherwise modify

“any provision made by or under primary legislation passed before, or in the same session as … this Act ... and may make different provision for different purposes or … areas”

or

“contain supplementary, incidental, consequential, transitional or saving provision”.

The Government may respond that the power to make consequential provision is confined to what is purely consequential. That is true, but what is purely consequential turns on the scope of the provisions they are said to be in consequence of. Combining these consequential powers with the wide powers in Part 5, for example, would seem to give the Secretary of State the power to confer on his enforcement officers even wider powers when entering offices to search and seize documents, if they are in some way connected with the operation. I think even Henry VIII would have been impressed. His 1539 Statute of Proclamations allowed him to amend legislation by decree, but even he was not permitted to prejudice

“any person’s offices, liberties, goods”

or “chattels”.

Then there is the power to make provision for different purposes or different areas. What is the need for that power? When I was in government as a lawyer, parliamentary counsel would probe closely as to why we needed this power, and we would have to justify it. My amendment is therefore designed to bring some transparency and due diligence to the use of these Henry VIII powers before they are laid and debated. It would simply provide that, before such regulations could be laid, there would need to be an impact assessment laid before Parliament for three months to enable a bit more parliamentary scrutiny. This would give time for reflection and, if the Government decided to proceed with laying the regulations, it would serve to enhance the level of parliamentary debates on the regulations that subsequently take place under the affirmative procedure.

I give the last word to the great Lord Judge, who spoke strongly against such clauses when he was Lord Chief Justice of England and Wales. He said:

“You can be sure that when these Henry VIII clauses are introduced they will always be said to be necessary. William Pitt warned us how to treat such a plea with disdain. ‘Necessity is the justification for every infringement of human liberty’”.

[Lord Hunt of Wirral (Con)]

My Lords, I thank the noble Lords, Lord Palmer of Childs Hill and Lord Carter of Haslemere, for their amendments in this group. As the noble Lord, Lord Palmer, commented, it gives us the chance to send further good wishes to the noble Lord, Lord Fox, for a speedy recovery. We look forward to seeing him back in this Chamber to discuss this vital Bill.

Dealing with Amendment 317 first, the Government have already acknowledged that the vast majority of the costs associated with this legislation will fall on smaller businesses, but it is not just the obvious headline of which we must be mindful. As the noble Lord, Lord Palmer, pointed out, there are significant hidden costs too. These include the need to hire legal professionals, expand human resource capacity, and navigate increasingly complex compliance requirements, which many smaller firms simply cannot afford. That is why statutory guidance specifically tailored for small businesses—those with fewer than 50 employees—is not just helpful; I agree with the noble Lord, Lord Palmer, that it is essential. These businesses are the backbone of our economy. They do not have in-house counsel, nor the luxury of large HR departments, yet they are bound by the same obligations under this Bill as any large corporation.

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[Lord Leong (Lab)]

I am grateful to all noble Lords who have spoken. I thank the noble Lords, Lord Carter of Haslemere and Lord Fox, for Amendments 317, 326 and 329, and the noble Lord, Lord Palmer, for moving the amendment in the name of the noble Lord, Lord Fox.

Amendment 317 in the name of the noble Lord, Lord Fox, is on guidance for small businesses. Ensuring that businesses are supported to implement these reforms is fundamental to the successful delivery of the plan to make work pay. We have committed to providing guidance to ensure that all stakeholders have the information required to make necessary adjustments. We are engaging closely with employers of all types from a range of sectors to understand how the Government can best support them in their preparations.

Support may look different for different sectors, sizes of company, regions and so on. We want to make sure that we properly consider the needs of different employers and respond in the most effective way. This could include a variety of tailored guidance and support. The amendment risks preventing the Government taking the type of tailored approach that we hope will be most effective. Our forthcoming implementation road map will set out our plans for consultation and implementation of the Bill’s measures.

Our Employment Rights Bill delivers the most significant upgrade in employment rights in a generation, creating a modern, fairer labour market. We will continue to consult and engage to make sure we get delivery right. We will produce guidance, provide support, allow time to prepare, and ensure the enforcement landscape works. I make it clear that I agree with the noble Lord that it is in everyone’s interest that small businesses are properly supported to implement the Bill, and the Government are committed to doing so.

Amendment 329 from the noble Lord, Lord Fox, would make commencement of all the Bill’s measures contingent on the approval and publication of statutory guidance. This would unnecessarily delay commencement of measures that can be delivered more quickly. We are committed to supporting small businesses and will ensure that timely and targeted guidance is delivered where relevant.

I turn to Amendment 326 from the noble Lord, Lord Carter. I have read the entire Bingham lecture from my noble and learned friend the Attorney-General. Nowhere in his speech did he say that statutory instruments should not be used. As most noble Lords know, employment legislation uses true statutory instruments because they save parliamentary time, as mentioned in the Attorney-General’s speech, so that we can get more of this on the statute book.

I reassure the noble Lord that the Government have sought to limit the use of the Henry VIII powers within the Bill and believe our approach to their use is proportionate. I can also reassure the Committee that the Government already have robust plans in place to assess and review the impacts of this Bill. The noble Lord’s amendment would add unnecessary bureaucracy to this and other necessary powers in the Bill. It would also, in effect, duplicate work that the Government are already committed to undertaking.

Take, for example, the power in Clause 132(6). This allows the Secretary of State to update, expand or otherwise modify the list of bodies specified in Schedule 9 to the Bill with which information may be shared by the fair work agency. It is a Henry VIII power, subject to the affirmative procedure. The Government believe this is an entirely appropriate use of such power and the DPRRC also raised no concerns.

Specifically on the power in Clause 151, I reassure the noble Lord that, where possible, amendments to other pieces primary legislation that are required as a result of the Bill’s provisions have been made in the Bill itself. This includes amendments in Schedule 1 that are consequential on the provisions regarding zero hours in Clauses 1 to 5; those in paragraphs 5 to 19 of Schedule 3 that are consequential on the changes regarding unfair dismissal; and the provisions in Schedule 10 that are consequential on the provisions in Part 5. However, it is possible that further provisions will be identified that require consequential amendments. Allowing these to be made by regulations will mean they can be made without delay and with appropriate levels of parliamentary scrutiny. The power is constrained as it will allow amendments only where they are consequential on the provisions already made in this Bill.

Supporting employers to understand the requirements of the Bill is key to achieving the objectives of the plan to make work pay. I hope noble Lords are assured of the Government’s firm commitment to effectively and appropriately support stakeholders in preparing for employment rights reform.

This will be my last time speaking in Committee on this Bill, so—

[Lord Hunt of Wirral (Con)]

If this is the last time the Minister is going to speak, I should point out that he started off by telling us about the road map, which his noble friend promised we would see shortly. In his closing remarks, would he like to tell us when we will see it? Will it be tomorrow, or next week? We would like to see it as soon as possible; indeed, we would love it if he could publish it now, before he finishes his closing speech.

[Lord Leong (Lab)]

It is tempting, but I can assure the noble Lord that it will be published very, very, very soon. How is that?

Like I said, this is the last time I will speak in this Committee. I want to take the opportunity to express my gratitude to all noble Lords for their extensive engagement and the robust way in which we have debated this stage of the Bill’s passage. I pay particular tribute to the noble Lords, Lord Sharpe, Lord Hunt and Lord Fox, and to the noble Lords, Lord Goddard and Lord Palmer, for standing in so ably for him. Like the noble Lord, Lord Hunt, I wish the noble Lord, Lord Fox, well in his recovery and look forward to welcoming him back.

Let me be clear: this Government welcome scrutiny—that is the purpose of this House—but scrutiny must be grounded in the present and focus on the issues at hand, not lost in the echoes of decades-old political arguments. Some contributions, regretfully, seem to have been more intent on reviving grievances from the 1970s than addressing the needs of today’s Britain.

This Bill delivers on a clear manifesto promise. It is part of our plan for change, built not on rhetoric but on the practical need to provide security for working people and long-term renewal for the country. This is where our focus lies—not on refighting the past but on fixing the future. We continue to welcome serious challenge, and we expect debates to be robust, but we also expect them to be proportionate, honest and forward-looking.

As we approach the end of Committee this evening, we on this side look forward to constructive and collaborative meetings and engagement with all noble Lords ahead of Report. With that said, I respectfully ask the noble Lord to withdraw Amendment 317.

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[Baroness Bennett of Manor Castle (GP)]

My Lords, my Amendment 320 sits in glorious lone splendour in this group. I am not responsible for degrouping it; that was the way it was arranged. Noble Lords will see that this is a proposed new clause to introduce a maximum pay ratio. I thank the Public Bill Office for assisting me with the drafting.

The noble Lord, Lord Sharpe, took us into celebrity land with Usain Bolt and Mo Farah. I am going further into that space with a forthcoming event from this week: the wedding of Jeff Bezos and Lauren Sánchez in Venice. I am relying here on the interesting reporting in the Guardian from Zoe Williams, who has been spending time with the campaign group No Space for Bezos and finding that in Venice there is considerable resistance to a billionaire taking over a city and totally disrupting the life of that city for three days. Williams quotes one of the local campaigners:

“We really wanted to problematise the ridiculous and obscene wealth that allows a man to rent a city for three days”.


Williams reflects in the article that

“when wealth itself is seen to be acting in its own interests, and it has accumulated to the degree that its impact scars every poorer life with which it comes into contact”,

we have a problem.

This amendment sets out Green Party policy—yes, this is long-time Green Party policy—but I am really aiming to assist the Government constructively here, and to assist the Committee as well as perhaps our national debate, by demonstrating that it is possible to lay down bridges to cross the deep fissures in our society. They are not just in Venice and they do not just involve Amazon—although I note that the Government have been applauding an expansion of Amazon here in the UK. We might think about how many of the small businesses we have just been talking about might go out of business as a result of that. I posit that it is essential to start to bridge these chasms, to tackle the poisonous inequality that so affects our political landscape.

Bringing the context closer to home, noble Lords may perhaps have expected me to cite research out only a week ago from the High Pay Centre, which analysed five years of mandatory pay ratio disclosures across the FTSE 350. This was a previous modest legislative attempt, hoping that shining a light on the level of inequality might have some impact in reducing that inequality. The study clearly showed that the attempt to do that has failed. The figures have basically bobbled around since 2019, and the current ratio of median CEO pay to the median UK employee was 52:1. That has been at a similar level ever since the ratio started to be recorded. I note that it is even worse for the FTSE 100, where the median CEO to median employee pay ratio was 78:1. Those are the middle figures but, if we take the widest measures, we go to the security and catering group Mitie, where 575:1 is the ratio not to the lowest-paid employee but to the median employee. At Tesco it is 431:1. This situation is doing huge damage to our society, and I put it to the Government that they surely have to tackle it.

A 10:1 ratio is Green Party policy. I know from the discussions that the Minister kindly had with me before this debate that she will not leap up and support my amendment, but I hope she may be able to provide some response, at least to acknowledge that we have a problem. The pay differentials also react to the low-pay environment in which those essential to the success of a business are not getting the respect, as well as the pay, that they deserve. Meanwhile, a few at the top are incentivised to chase short-term profits and share price valuation at long-term cost to society but also to the businesses that they head.

The impact on communities is evident in towns and cities, where the vast bulk of workers are now trapped on or very near the minimum wage, while money is shovelled away to faraway company headquarters. Companies defend these sums as reflecting performance, but all too often, as we have seen with the water companies, that is far from the case. Why is it that every worker does not benefit if a company is doing well, as they have all contributed?

I finally note that, yes, this is also an environmental measure. To take just one element of the CEO lifestyle, the wealthiest people in the UK burn through more energy in flying alone than the poorest use in every aspect of their life. Environmentally, as well as socially and politically, we cannot afford a society split between a few have-yachts and the majority have-nots.

[Lord Hunt of Wirral (Con)]

My Lords, I rise to speak to this amendment and, frankly, to express a degree of disbelief that such a proposal should have been made. With due respect to the noble Baroness, I do not believe that this amendment is a serious contribution to the debate on fair pay or responsible corporate governance. It is a piece of performative and ideological showmanship—a throwback to a worldview that sees profit as a vice, wealth as inherently suspect and enterprise as something to be managed, limited or downright punished. The idea that government should impose a legal maximum pay ratio—a flat arbitrary ceiling of 10:1 between the highest-paid and lowest-paid employees in every organisation—is not just unworkable but, I believe, economically illiterate.

First, this proposal would be a gift to bureaucracy and a curse to business. Every company, from high street shops to high-growth tech firms, would have to monitor and police every single form of pay—salary, shares, bonuses, pensions and benefits in kind—just to ensure that they do not cross an artificial line. Do we really want our job creators to spend their time calculating compliance spreadsheets instead of investing, innovating and employing? Secondly, it would actively disincentivise growth and ambition. High-performing individuals—those who drive investment, lead exports and create jobs—would simply leave and take their talent elsewhere.

The noble Baroness mentioned Amazon. I join the Government in welcoming the further investment that Amazon is making. As a matter of record, Amazon employs circa 75,000 people in the UK. No one is on zero hours, and the minimum annual starting salary is between £28,000 and £30,000 a year. It provides flexible working opportunities from day one, including term-time contracts, which allow parents, grandparents or carers guaranteed leave during school holidays. It offers paid parental and bereavement leave. Amazon also offers guaranteed hours from day one, and employees have the choice of full-time or part-time contracts. It is important to put the record straight. Since 2010, Amazon has invested more than £64,000 million in the UK, and £12,000 million in the last 12 months, and supports a network of around 100,000 UK-based small and medium-sized businesses. I welcome the opportunity that the noble Baroness has given me to put the record straight.

To go back to the noble Baroness’s amendment, it would mean that employers would be forced to avoid hiring lower-paid staff altogether, just to protect the ratio. What would be the result? There would be fewer jobs, less opportunity and more outsourcing—the very opposite of what a fair and inclusive economy should look like, hitting the least well-off, the most vulnerable and those at the margins of the labour market.

My third point is that this is not fairness; it is levelling down. It is virtually saying, “Don’t succeed too much, don’t reward excellence, don’t grow too big or too fast or be too profitable”. That is not fairness—it is anti-growth, anti-aspiration and anti-business. I must tell the noble Baroness that this amendment looks like it would be more appropriate in a Maoist economic manifesto, delivered to his revolutionary cadres, rather than a serious proposal for modern employment legislation. What this amendment reveals is not a serious attempt to solve a policy problem but a mindset that is suspicious of success, dismissive of wealth creation and entirely detached from economic reality. Against that background, I look forward to hearing the Minister’s response, which I hope will agree with mine, that this is an amendment that should not be accepted.

[Lord in Waiting/Government Whip (Lord Katz) (Lab)]

My Lords, let accord break out across the Table. I thank the noble Baroness, Lady Bennett of Manor Castle, for tabling Amendment 320. I do not share the disbelief of the noble Lord, Lord Hunt of Wirral, in hearing it, but only because I probably have more than the passing acquaintance with bits of the Green Party manifesto that he perhaps does—and that is the only reason for it.

It is right that companies should be sensitive to wider workforce pay when setting pay for those in the boardroom and other senior leadership positions. Company law and wider regulation already address that point. First, the Companies Act requires that UK listed companies must disclose and explain each year the ratio of their CEO’s pay to that of the company’s lower-paid and average-paid employees. Secondly, under the UK Corporate Governance Code, listed companies are asked to review workforce remuneration when setting directors’ pay and engage with employees to explain how executive pay aligns with wider company pay policy. Taken together, these measures provide important transparency and accountability in how UK listed companies deal with pay and incentives across the whole employee base.

Employment Rights Bill

Lord Hunt of Wirral Excerpts

Committee stage
Tuesday 24th June 2025 Lords Chamber

[Lord Norton of Louth (Con)]

My Lords, this amendment provides the means to check that the Bill, once enacted, achieves the purposes for which it is intended. It is a more comprehensive amendment than several that have been debated already, which provide for a review of certain provisions within 12 months of the Act coming into force. I shall argue that the relevance of the amendment goes beyond the Bill itself.

Too often in the past, legislative success for a Minister was seen as a Bill receiving Royal Assent. In evidence to the Constitution Committee’s 2004 inquiry into Parliament and the legislative process, former Clerk of the Parliaments Sir Michael Wheeler-Booth and Professor Vernon Bogdanor noted that,

“all too often, Parliament forgets about legislation once it has reached the statute book”.

Legislative success should be seen not as getting a Bill on the statute book but rather as delivering on what Parliament intended it to deliver.

As the then leader of the House of Commons, the noble Lord, Lord Hain, told the Constitution Committee,

“there is no point in passing legislation if it is not having the desired impact or it is having a different impact”.

Recognition of that point led the committee in its 2004 report to recommend that most Bills should be subject to post-legislative scrutiny within three years of their commencement or six years from their enactment, whichever was the sooner. In 2008, the Government accepted that Bills should normally be subject to review three to five years after enactment, a policy reiterated by Ministers in recent months. Indeed, in January this year, the noble Baroness, Lady Twycross, reported that the Cabinet Office had written to departments reminding them of the importance of post-legislative scrutiny.

In practice, not all Bills are subject to post-legislative review by departments. Some have undertaken thorough reviews, but the enthusiasm for completing them appears to differ between departments. Earlier this year, I asked whether the Government would encourage departments to emulate the Home Office, which had engaged in detailed post-legislative scrutiny of the Counter-Terrorism and Border Security Act 2019. There is a compelling case for ensuring that, in respect of certain Bills, post-legislative review is put beyond doubt through being embodied in the measures themselves.

There are precedents for including within a Bill a provision for post-legislative scrutiny. The most recent incidence is the Football Governance Bill. The Government, to their credit, accepted the argument that the Bill should provide for post-legislative scrutiny and brought forward their own amendment on Report to give effect to that proposal. The wording of my amendment may appear familiar to the Minister as it is taken from the Government’s amendment to the Football Governance Bill.

Bills that meet certain criteria should contain such a provision. The criteria I propose are that the Bill is large, is complex, makes substantial changes to the law, is contested and has not been subject to pre-legislative scrutiny. Bills that meet some but not all of the criteria may be considered for incorporating such a provision. A Bill that is not large but meets the other criteria should normally be considered for embodying provision for such scrutiny.

Each year your Lordships’ House usually appoints a special inquiry committee to engage in post-legislative scrutiny of an Act or group of Acts, such as the Mental Capacity Act or adoption legislation, that generally do not meet any of the criteria I have mentioned. That we select measures of this type for such scrutiny is not an argument against enshrining post-legislative scrutiny in some Bills but rather the reverse. We steer clear of Acts that are large and contentious. We are not likely to select the measure before us for post-legislative scrutiny in a few years’ time. Our scrutiny should complement that undertaken by government of measures covered by these criteria.

The arguments for post-legislative scrutiny of major Bills are several. There is the effect on drafting—knowing that a measure will subsequently be subject to review helps to concentrate the minds of Ministers and drafters in preparing the Bill. It serves to prompt a clear adumbration of purpose—of delineating the basis on which one will know whether the measure has achieved what it was designed to do. Perhaps most importantly, knowing that it will subsequently be reviewed may serve to reassure critics of the measure. That was especially helpful in the context of the Football Governance Bill. I think it applies in the case of this Bill.

Above all, providing the means of checking whether a measure has or has not met its aims and identifying what needs to be done to rectify any problems with its delivery contributes to good law. The Office of the Parliamentary Counsel has previously defined good law as law that is

“necessary, effective, clear, coherent and accessible”.

I have defined it as law that is well intentioned, well drafted and well implemented. Some of these features need to be checked during the Bill’s passage, but others, especially being effective or, in my terms, well implemented, are best tested through post-legislative scrutiny. As one Minister told this House’s Select Committee on the Mental Capacity Act 2005,

“while getting the Act onto the statute book had been a success, ensuring that it was fully implemented and understood was ‘work in progress’”.

This Bill clearly meets the criteria I have outlined. It is large, complex, makes a substantial change to employment law, is clearly contested and was not subject to pre-legislative scrutiny. The Committee has considered more than 330 amendments over 11 days. There are clearly disputes about the principles it embodies and its effect. Putting a provision for post-legislative scrutiny in the Bill, thus ensuring such scrutiny, meets the purposes I outlined.

The Minister may remind us that the Bill will be eligible for post-legislative review in any event, but this amendment puts it beyond doubt. If the Government have confidence in the Bill, they should have no problem in accepting the amendment. Critics may be reassured that, as with the Football Governance Bill, its effects will be reviewed. The amendment sets out the review to be undertaken before the end of a period of five years, and what the review in particular must assess. It also requires the Secretary of State to publish an invitation to interested parties to make submissions on the operation of the Act.

As I say, the provisions replicate those in the Football Governance Bill, omitting only the parts that are specific to football and do not lend themselves to replication in other measures. I urge the Government to build on what they have already achieved in the Football Governance Bill and establish best practice in embodying within this Bill provision for post-legislative scrutiny. Utilising the criteria I have detailed limits the number of Bills that merit such a dedicated provision. This Bill does merit such a provision, and I hope the Minister will demonstrate that the Government have the confidence to embrace it. I beg to move.

[Lord Hunt of Wirral (Con)]

My Lords, I welcome the opportunity to pay tribute to my noble friend Lord Norton of Louth. He is not only a great author and academic, but he is regarded as a world authority on constitutional issues, and he has certainly been described as the greatest living expert on Parliament, so we take very seriously his very constructive suggestion for post-legislative scrutiny.

However, I rise to speak to Amendment 335, standing in my name, which would introduce a sunset clause ensuring that the Act will expire after three years unless the Secretary of State demonstrates that it has led to a net increase in employment. I do so against a background of economic data emerging in recent months painting a deeply concerning picture of the UK labour market. The UK’s jobless rate ticked up to 4.6% in April, while payrolled employment has fallen sharply, according to official figures covering the period when the Budget tax hikes on businesses came into effect.

We had an understanding that some of us would attempt to put together an overall view of what is happening in the jobs market at present, but the response from the business community to this Bill has been unambiguous and deeply troubling. The Institute of Directors has published research showing that more than seven in 10 business leaders—72%—believe that the Bill will have a negative impact on the UK’s economic growth. This is not a marginal concern expressed by a vocal or unrepresentative minority; it represents a clear majority of all those who create jobs in our economy.

Even more alarmingly, half of business leaders reported that they would be less likely to hire new staff as a direct consequence of this legislation. Let that statistic sink in. We are therefore considering legislation that, according to those who make the hiring decisions, will directly reduce employment opportunities for British workers.

These employment figures do not exist in isolation. They form part of a broader pattern of economic decline that, sadly, has accelerated since this Government took office. The combination of increased employer national insurance contributions, the various tax rises announced by the Chancellor and now this additional regulatory burden create a perfect storm of disincentives to business investment and job creation.

We are now witnessing the practical consequences of economic policies cobbled together on the basis of wishful thinking and political prejudice by people with little or no first-hand experience or understanding of how businesses operate in practice. When costs rise, businesses must respond. They cannot simply absorb infinite increases in regulatory compliance, tax obligations and employment-related expenses. The rational response is to reduce costs where possible—and, unfortunately, employment costs are often the largest element in business operations as well as the most unpredictable.

Throughout the debates on this Bill, both the Ministers opposite and their colleagues in the other place have maintained that it will not harm employment. They have repeated this assertion with remarkable consistency, despite mounting evidence to the contrary. This represents either a fundamental misunderstanding of basic economic principles or a deliberate choice virtually to ignore inconvenient evidence.

The Government appear afflicted by a sustained delusion that they can simultaneously increase the costs and complexity of employment while maintaining that employment levels will be unaffected. This surely defies both economic logic and empirical evidence. It is rather like claiming that one can increase the price of a product while ensuring that demand will remain unchanged, simply by insisting that it must be so.

We have to entertain the possibility that we on these Benches are wrong. Perhaps the business community is wrong. Perhaps the Office for Budget Responsibility is wrong. Perhaps the employment statistics are, at best, misleading. Perhaps the correlation between increased business costs and reduced hiring is merely coincidental. Perhaps economic theory and established business common sense are for the birds. My amendment is designed to test the Government’s confidence. If Ministers are indeed confident that this Bill will benefit workers and boost employment, they should graciously accede to this amendment and demonstrate to us all their unshakeable iron confidence that this is not, after all, an unemployment Bill.

--- Later in debate ---

Moved by

[Lord Hunt of Wirral]

324A: Clause 151, page 147, line 31, leave out subsection (2)

[Lord Hunt of Wirral (Con)]

My Lords, I rise to move Amendment 324A and to speak to Amendments 324B and 324C on behalf of my noble friend Lady Coffey; I will also speak to my opposition to Clause 151 standing part of the Bill.

--- Later in debate ---

[Baroness Jones of Whitchurch (Lab)]

My Lords, I thank the noble Lord, Lord Hunt, for giving notice of his opposition to Clause 151 standing part, which gives me the chance to set out the purpose of that clause, and for speaking to Amendments 324A, 324B and 324C, which, as I understand it, are probing amendments.

Clause 151 grants the Secretary of State a power by regulations to make amendments to other legislation which are consequential on any provision made by the Bill. Consequential amendments are fundamental to ensuring that the statute book remains coherent and workable. It is a Henry VIII power similar to the ones used in previous legislation of similar size and complexity. It allows the amendment of Northern Ireland legislation, as it does Acts of the Scottish Parliament and the Senedd Cymru. This is necessary to allow the statute book across all UK jurisdictions to be maintained effectively.

None the less, the power in Clause 151 is appropriately constrained because it allows only amendments which are consequential to the substantive amendment already made in the Bill itself. For these reasons, we consider it both necessary and proportionate. I also remind noble Lords that the Delegated Powers and Regulatory Reform Committee did not raise concerns about the power in Clause 151 in its report, to which we will reply in due course.

I reassure noble Lords that, where possible, amendments to other pieces of primary legislation that are required as a result of the provisions made in this Bill have been made in the Bill itself, as my noble friend Lord Leong set out earlier. However, it is possible that further provisions could still be identified that require consequential amendment. Allowing these to be made by regulation will mean that they can be made without delay and with an appropriate level of parliamentary scrutiny. This is a standard power in a Bill of this size and complexity. There are multiple examples in legislation from recent Conservative Governments that took the same approach, including the Police, Crime, Sentencing and Courts Act 2022 and the Economic Crime and Corporate Transparency Act 2023.

Amending the clause so that any exercise of the power would be subject to the affirmative procedure would result in debates on every consequential amendment, which we believe would be disproportionate. For these reasons, the Government oppose these amendments, and I hope that I have reassured the noble Lord, Lord Hunt of Wirral, that the power this clause vests in the Secretary of State is proportionate. I therefore ask him to withdraw Amendment 324A.

[Lord Hunt of Wirral (Con)]

My Lords, I thank the Minister for her response to the concerns that I raised during this debate. However, I remain unconvinced by the Government’s justification for these sweeping powers. As we have said on several occasions already, there are far too many delegated powers in the Bill as it stands. To extend this approach to all consequential future provisions represents a qualitative leap in executive authority that goes well beyond what is necessary or constitutionally appropriate.

I recognise that the Minister has given assurances about responsible use of these powers, which, no doubt well-intentioned, cannot substitute for proper parliamentary oversight built into the legislative framework itself. We are being asked to sign a blank cheque, drawn on the account of parliamentary sovereignty. The breadth of these consequential powers, combined with the minimal oversight mechanisms, represents precisely the kind of constitutional overreach that this House exists to prevent.

I remind Ministers—like many noble Lords, I have painful first-hand experience of this—that the powers may not be indefinitely in the hands of Ministers of any one party. Power changes hands from time to time, and they ought possibly to reflect on the extraordinary legacy of centralised executive power they may find themselves bequeathing to a new Administration that is not of their political persuasion. Governments change, Ministers change and political priorities evolve. Constitutional safeguards must be designed to protect parliamentary sovereignty, regardless of who holds executive office. I urge noble Lords across the Chamber to reflect carefully on whether we are prepared to accept such a substantial erosion of parliamentary authority in the name of administrative convenience. Some principles are surely too important to compromise, and parliamentary sovereignty is surely paramount among them. But, in the meantime, I beg leave to withdraw the amendment.

Amendment 324A withdrawn.