Trade Union and Labour Relations (Consolidation) Act 1992 (Amendment) Order 2013

Lord Monks Excerpts

Tuesday 12th March 2013 Lords Chamber

[Baroness Turner of Camden]

My Lords, I rise to support my noble friend, who has expressed regret. I, too, regret this decision. I am not surprised that there is trade union opposition to it; I would be surprised if there were not. It seems to me that this decision affects not just individual workers but families as well. If this takes place where 100 employees are involved, this means that we are talking about larger companies. This may very well be in places where there has been substantial unemployment because of the decline of manufacturing industry in many areas—a decline for which we should of course thank previous Conservative Administrations, in particular the Thatcher Administration. There are many places where manufacturing industry provided the local population with jobs over a long period, but this is no longer the case, and individuals who face redundancy in such circumstances need a longer period to adjust to that redundancy and to find alternative work.

The Government say that we have a flexible workforce, as though this is something to be very proud of. I am rather suspicious of that view because it indicates that some of the employment rights that we have worked for over the years are in danger. The Government support the disappearance of some of these rights on the grounds that it makes for a more flexible workforce. I do not support that view at all. It is regrettable that the Government are moving down this path. We shall have to look very carefully at the way it operates, and the Government have said that they will watch to see how it pans out. It is not likely to be welcomed by the workforces when they discover that they suddenly do not have the period to adjust to redundancy that they once had. That is entirely regrettable.

Moreover, we could well be entering a situation in some of these areas where more workers enter into benefits, to the discomfort of the Government, who wanted to get people off benefits but who then of course talk about the taxpayer having to bear the brunt of benefit claimants. What else do they expect if they are making it easier for workers to be dismissed? I regret this decision by the Government, and I hope that my colleagues will also regret it.

[Lord Monks]

My Lords, I, too, rise to support the regret Motion that has been moved by my noble friend Lord Young. The present rules on the period necessary for consultation are designed, in part at least, to provide an opportunity for employers and unions to explore alternatives to redundancy. These alternatives could be short-time working or transfers to growing parts of the business. They could be used to help those workers who are to be made redundant to find alternative work with another employer.

If the minimum period is to be cut in half, these opportunities are inevitably reduced. Staff will be laid off more quickly. The wages bill of an employer will be cut correspondingly. However, the cost, as has been demonstrated by my noble friend Lord Lea, will be met by those who are being made redundant. The impact assessment makes it absolutely crystal clear that this is a straight transfer from employees to their employer and, as my noble friend Lady Turner has just reminded us, to the state, too, if people go into unemployment more quickly than would otherwise be the case.

This is the latest salami slice of employment rights. I remember that in the 1980s Jim Prior used to refer to a step-by-step approach when he was legislating against trade unions. Now, with Vincent Cable and the coalition Government, we have a slice-by-slice approach going on. The measure before us is justified mainly by anecdotal evidence, and by the cries of some—but by no means all—employers that redundancies in the UK are too expensive. I see that there are also some allegations that the UK has gold-plated the EU directive which underpins this law. In fact, by easing the obligations of employers, one makes UK employees more vulnerable to being fired when multinational companies are cutting their staff. We in the trade union world already feel that British workers are uniquely vulnerable because of our so-called flexible labour market, which, as my noble friend Lord Young has claimed, reminds us that we are the third least regulated labour market in the OECD.

The inconvenient truth is that the consultation arrangements in other European countries as a whole are more extensive than ours. In the Netherlands, for example, the authorities can extend the period of consultation to find alternatives to redundancy above the minimum figures to which the Minister referred. Could we perhaps add that provision to what the Government propose? I note that in Germany, where no agreement is reached in the works council, the issue can be referred to arbitration. Is that something which the Government have actively considered?

I can only come to the conclusion that the Government are intent on weakening the worker hand in difficult situations. This is not the road to building up high productivity and high-quality partnerships at work. It is not the right road to building successful economies—as successful, perhaps, as some of these other economies on the other side of the North Sea to which I have referred and to which the noble Lord, Lord Heseltine, keeps trying to drag the attention of that side of the House when he talks about the need for Britain to emulate some of the practices that apply in those countries that are coming though the recession, and coming along more strongly than we are.

Perhaps I may ask a specific question about the minimum threshold of 20 employees per establishment. This, as the Minister probably knows, led to some anomalies which were exposed in the recent closure of Woolworths stores. Most of the stores did not employ 20 people and, because it was looked at as an establishment issue, rather than the undertaking of Woolworths as a whole, there was no proper opportunity for consultation. That anomaly is crying out to be tackled, and a move should be made from establishment to undertaking.

In conclusion, the Government should stop this slicing away of employee rights. They should start promoting better relations and high productivity, and you do not do that by making firing easier.