Transparency of Lobbying, Non-Party Campaigning and Trade Union Administration Bill Debate
Full Debate: Read Full DebateLord Monks
Main Page: Lord Monks (Labour - Life peer)Transparency of Lobbying, Non-Party Campaigning and Trade Union Administration Bill
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Lord Monks
(a) a formal complaint is received by the Certification Officer that would result in the Certification Officer requiring a membership audit in relation to the reporting period when the complaint was verified, and(b) the Certification Officer determined that a certificate was required.”
Lord Monks (Lab)
My Lords, I shall speak also to Amendments 118B and 118D standing in my name and that of my noble friend Lord Stevenson, and shall also oppose the Question that Clause 36 stand part of the Bill. I will also speak in support of the amendments tabled by my noble friends Lord Whitty and Lord Lea of Crondall.
We are in some difficulty in dealing with Part 3. We had assumed that this was going to come up at around the end of the month because that was the original schedule. However, with the pause to Part 2 agreed here a week ago, it has all been rushed forward. Part 3 has been jinxed from the start. It was a very late addition to the Government’s programme and to the Bill. The short consultation period was in August, which is not a particularly busy month for many of us, and now, given the attention that has been given so far to Part 2, we are dealing with Part 3 on the run in this House before many people are remotely aware of its significance or of what it is about. However, our contention on this side is that this part of the Bill is very important. We hope that today we will at least be able to raise awareness of the issues at stake and appeal to fair-minded Members on all sides of the Committee for their support in looking in detail at what this part involves.
We have raised our opposition to the clause standing part as part of an attempt to persuade the Government to think again and to think further about what resembles a vindictive attempt to load on to trade unions a great new dollop of red tape—a new layer of bureaucracy that is unnecessary by any objective or fair-minded standard. Of course unions should keep accurate records. Indeed, they are already required to do so under the Trade Union and Labour Relations Act. They are required to make detailed returns on an annual basis to the certification officer. They are required to have independent scrutineers in all elections, and invariably those scrutineers check the membership registers. The certification officer—the union regulator—has the power to order a rerun if there is a complaint of sufficient importance.
I note from yesterday’s press that there are allegations by a defeated candidate about a recent election in Unite. By the way, that election was supervised by Electoral Reform Services—the old Electoral Reform Society. I also understand from the press that a complaint has now been made to the certification officer. If it is upheld, the certification officer will have appropriate powers, if necessary, to order a rerun. He does not need new powers as foreseen in the Bill. As far as I know, the certification officer has not asked for any new powers. He does not feel that he is lacking any ability to deal with issues that are referred to him. Therefore, I do not believe that there is any basis for heaping extra requirements on to unions. Likewise, industrial action ballots can be, and occasionally are, challenged by employers on the grounds either that inappropriate people are balloted or that people are missed out of a ballot. Therefore, unions have every incentive to keep accurate records.
I should like to know from the Government why they are doing this. What is the motivation for it? Why are they incurring considerable expense on all sides—unions, employers, the Government and the taxpayer—for this particular non-event? There is no rationale for this provision, which will involve extra bureaucracy and extra costs. This Government were anti-red tape when they were on the other side of the House, but they are obviously making an exception for trade unions.
The cry has gone up that we need more assurance and more confidence. I see the noble Lord, Lord Tyler, in his place. He suggested, among other things, that this was necessary because a union has a political role. Lots of other organisations have political roles, but are their membership rolls to be supervised by a public official? Are the political parties going to be thrown into the mix? Do we need some assurance about how many members they have? That would be very interesting for some of us to read. No, it is unions, again, that are being scapegoated and picked out to be given a kick on this issue.
By the way, only a small minority of unions have anything directly to do with the Labour Party, yet many, such as the Royal College of Nursing—which is, I may say, a good way off the Labour Party—will be affected by this part of the Bill. It is a blunderbuss, aimed at just one section of society that plays a political role. If I were paranoid, I would say that we were being persecuted.
The stated intended effect of the Bill is to ensure that voting papers and other communications reach union members, and so give greater confidence that members have the chance to participate in union affairs. There will be a new statutory duty to provide the certification officer with an annual membership audit certificate that provides an opinion on the union register, with the larger unions having to appoint an independent “assurer”—I have not come across that interesting title before—and a duty for the certification officer to appoint inspectors to investigate and make orders, and for those officials to issue declarations and enforcement orders for non-compliance. Heavy-handed, or what?
That is tough administration. Again, if unions were getting a litany of great numbers of complaints, I might be able to understand the reason for it. But there is no such evidence. As I and others pointed out at Second Reading, there is absolutely no practical reason for these measures to be in the Bill.
Are union membership records defective? They are not perfect; I would be the first to acknowledge that. How can they be? Unions collect their money in one of three ways. The traditional way was through regular cash collections by voluntary officials such as branch secretaries, shop stewards and others. That is very difficult in some circumstances—in construction, for example, with a fluid workforce and many people on very short-term contracts. It is difficult in many other places, too, as anybody who has ever collected money for a political party or a voluntary organisation knows. The record keeping could sometimes slip, depending on the efficiency of the individual collector; I have no doubt about that.
The second way to collect subs is by the so-called check-off method, using deductions at source by an employer, for which the union usually pays the employer a handling charge. In one of my other roles, helping to secure auto-enrolment for pensions, we are having a lot of trouble with the quality of employer payrolls. With some of them, as many as one in four workers is not properly reflected on the payroll. I know that unions and employers together have big problems handling the check-off. In certain sectors, such as retail, there is a high turnover of labour: a third of the members of USDAW, the main retail union, have to be replaced each year just for membership numbers to stand still. Keeping those records up to date is a huge administrative job. The employer is probably paying a quarter in arrears anyway, so for a significant part of the quarter a union may be some way out with its membership register. The third method is by direct debit and standing order. They tend to be more accurate, so I shall not dwell on those.
Where are the problems with all this? It is not perfect, I agree. If I were the assurer I would not quite know how to deal with some of the sectors where unions have to collect their money and organise their members. Between 2000 and 2004, a total of six complaints were received by the certification officer, five of which were dismissed—and even for the sixth one he did not issue a declaration. He just expressed an opinion that some things could have been done differently. There had been no complaints in respect of a vast majority of unions. In fact, I did not know about another one at all until I read the Sunday Times yesterday.
I stress that there is no real problem. This is a remedy in search of a problem. I would like to think that many noble Lords on the other side of the House would be embarrassed about this waste of effort and time. The cost to unions of this part of the Bill on the Government’s own estimate is about £460,000. By the way, that is an underestimate, which fails to take into account the necessary changes to rule books. Some unions have to have rules revision conferences and some have them only every five years or so. It does not reflect the continuing cost of having the assurer and annual audit done year after year. It is not only unions that will have to pay. Business will have to pay and the estimate is about £400,000, £100,000 of which will end up on the Government’s budget, and therefore on all our budgets as taxpayers.
Some noble Lords will no doubt be thinking, “As a former general-secretary of the TUC, he would say that, wouldn’t he? It’s predictable stuff from the TUC”. But they do not need to take my word for it on this occasion. They need only glance at the report of the Regulatory Policy Committee, a business-dominated government committee attached to the Department for Business, Innovation and Skills whose sole purpose is to curb red tape. I emphasise that the committee is composed largely of business representatives from the chambers of commerce, the Institute of Directors, and others. It has issued a rare red card to the Government on this matter—a stop notice in effect on Part 3. Unfortunately, this was not available at Second Reading. The House as a whole needs to be alerted immediately to the report, and I hope that it will be prepared to look afresh at this proposed legislation.
Some noble Lords may not care too much for trade unions; they may think that they deserve all the flak they get. But I ask the fair-minded to take a look at the report. I shall quote some points. It says that the impact assessment of the Bill,
“needs to provide a more detailed assessment of all likely costs to trade unions … supported by further evidence that was gathered … It is unclear how accurate and up-to-date a membership register will have to be for a union to be considered ‘compliant’ … or what process of investigation would be undertaken by an independent qualified assurer, or how rigorous that process would be”.
It also refers to the recurring costs. The committee illustrates that it was only after the Bill was published that the short August consultation period was started. It highlights the failure to follow appropriate better regulation processes—hence the issue of that very rare red card.
Our case today is not just about red tape. Individuals sometimes have to be careful who knows they are in a union. Countries that require a public official to know who is or is not in a union tend to be despotic tyrannies. Although I do not belabour the Government with that charge, information on union membership is very sensitive. Blacklists do exist. Eight major construction companies have recently admitted that and more than 2,000 workers are in line with legal cases against some of the biggest household names in British construction. There are worries about membership information finding its way to the unscrupulous end of employers. Worries have been expressed by parliamentary committees about breaching the confidentiality of union membership records. There are concerns, too, that Part 3, despite what is in the Bill, is not compatible with Articles 8 and 11 of the European Convention on Human Rights or with certain obligations concerning the International Labour Organisation.
The Political and Constitutional Reform Committee has asked the Government to address these concerns during the course of proceedings on the Bill. There is plenty of criticism from around the House of this part of the Bill. Part 3 in fact confers powers on state officials in relation to voluntary organisations that seem odd in a liberal democracy—organisations which, under these international obligations, are protected from too much state interference. Only if there is a proportionate need, is the theme running through them, should curbs be brought in. I have not seen anybody yet demonstrate that there is any sort of proportionate need. Therefore, in the period between now and Report stage, we will be trying to raise general awareness about Part 3 and its rather vindictive, malicious nature. The Government did listen to reason on Part 2 and I hope that they will listen again on Part 3 in this intervening period. We are looking for support for our contention that Clause 36, a keystone clause in Part 3, should not stand part of the Bill.
Lord Monks
I thank the Minister for giving way. Is it not quite incredulous to use the cost in that way, breaking it down person by person in that way? We are talking about half a million pounds to be spent on a purpose which he believes gives confidence, assurance and so on but, if there is no real problem in the first place, the whole thing is built on a piece of tissue paper. That 6p becomes even more important to people like me. It is not so much that you have your tanks on our lawn, you have your hand in our pocket.
Viscount Younger of Leckie
These are the figures that I have presented, and it is fairly natural to break it down on a per-head basis. I would like to focus on costs. As set out in the impact assessment, I expect the cost to the public purse of implementing the provisions to be around £150,000. The additional responsibilities of the certification officer will mean hiring two to three extra staff members in his office. Some expenses may also be incurred if a complex investigation has to be undertaken, although it is likely that those investigations will be rare. We believe that the changes we are making are relatively modest. The new powers for the certification officer are largely consistent with activities that he undertakes at present. The Government have no plans to make wider changes to the role of the certification officer.
The noble Lord, Lord Monks, raised the issue of, as he put it, state intrusion into unions. That goes back to the first question that I answered for other noble Lords. The Data Protection Act will apply to the certification officer, his inspectors or assurers and they will be required to use any personal data, including data on union members, consistent with the protections that it contains. The Information Commissioner has powers to enforce the data protection principles and can impose substantial fines for some breaches. In addition, there are confidentiality obligations contained in the Bill so that an inspector or assurer can use or disclose information only if they do so consistently with the exercise of functions in relation to the membership register or criminal investigation or proceedings or where consent has been given.
I would like to address two further questions. The noble Lord, Lord Monks, raised the issue of a perceived breach of Articles 8 and 11 of the ECHR and the report of the Political and Constitutional Reform Committee, which I believe I have answered already. The Government have responded to the committee’s report, explaining that these do not breach rights to privacy or freedom of association. That is because there are legal safeguards in place already. The Data Protection Act will continue to apply and the Bill introduces new safeguards as well.
The noble Baroness, Lady Donaghy, challenged the length of consultation. Perhaps I may address this directly. BIS published a discussion paper which received 42 written responses from a range of groups, including trade unions, legal firms, businesses and charities. The Deputy Prime Minister, BIS Ministers and BIS officials have discussed the proposals with the TUC at various points throughout the progress of the Bill to date. The evidence base in the impact assessment is based on what unions have told us and we will continue to listen. The Minister for employment relations has already said in the other place that the Government will consult further on the role of the assurer; for example, we are committed to allowing unions flexibility in the implementation of these new measures while supporting a smooth transition. We are also committed, as I said earlier, to continuing to work with the RPC as well on the evidence base for the impact assessment.
I ask the noble Lord to withdraw his amendment and beg to move that Clause 36 stand part of the Bill.
Lord Monks
My Lords, I am grateful to those who have taken part in what has been a wide-ranging debate, at least from this side of the House, which I suppose is only to be expected on this kind of subject. I ask fair-minded Members of the House, of which there are many on all sides, to consider this measure. The case for it is extremely flimsy. Are there not better things for the people from the department and the Minister to be doing? In a period of economic difficulty, the business department is messing about getting extra confidence and extra assurance about union membership records when, over many years, the complaints have been negligible. The existing requirements, which have been put in place during and since Mrs Thatcher’s time, have proved robust and effective. In a sense we are adding something on. As I mentioned before, it is almost like a rite of passage for every Conservative Minister in this place to have at least one kick at the trade union movement. I think that is very much what is happening now.
On this side of the House, we do not intend to press the amendments today but we are giving notice that, after a pause which will take place to enable Part 2 to catch up with Part 3, we will be making the point again on Report. It is an absolute waste of time.
Lord Monks
“(c) to have a duty of confidentiality to the trade union and its members; and(d) to abide at all times by the trade union’s obligations under the Data Protection Act 1998 to protect the information of members”
Lord Monks
I shall speak also to the other amendments in this group. They deal with confidentiality and administrative complexity, as well as some points concerning the position of the assurer. Incidentally, I rather liked the earlier comment by my noble friend Lord Stevenson that this provision amounts to job creation for chartered accountants, of whom he is one, but I believe that it will very much benefit a small part of the population.
I shall deal quickly with each of the amendments. The Bill has been much criticised by civil liberties organisations for allowing potentially significant breaches of data protection law. A legal opinion by Michael Ford QC, acting for UNISON, points out that under the European Charter of Fundamental Rights only a substantial public interest would justify the disclosure of this membership information. As we have said before—I shall not labour the point—where is the substantial justification in this case?
Nor is it absolutely clear that the Bill contains any suitable safeguards to protect sensitive personal data. An inspector would owe a duty of confidentiality to the certification officer but not, it seems, to the union or its members, and no duty of confidentiality is placed squarely on the shoulders of the certification officer. We are advised by legal advisers that the Bill may well not be permissible under the data protection directive, and Amendment 118E seeks to remedy that.
Amendment 118F seeks to ease the requirements on the union to appoint or terminate the appointment of the assurer and to put it in line with the terms under which scrutineers are employed to oversee union elections and ballots. Currently, the Bill tells unions to alter their rules but, notwithstanding that, the Bill’s provisions override the rules. An assurer could be removed only by resolution of a general meeting or conference. Not too many people have that requirement on them as far as auditors are concerned. It is not necessary to call a special shareholders’ meeting to get rid of KPMG or Deloitte or whoever, but there would be a requirement on a union in this area if this part of the Bill went through.
Amendment 118G would improve a union’s ability to remove an assurer who had breached the confidentiality of the union or breached certain other requirements. It stresses that the obligation is to the union and its members, and there is not necessarily a general airy-fairy commitment to give confidence to the wider world. As it stands, this provision would be extremely intrusive to the union’s right to keep its information confidential. As others have said, some of that information could be quite explosive in certain industries with more unscrupulous employers.
Amendment 118H would qualify the requirement for a system to be “satisfactory” by adding,
“so far as is reasonably practicable”,
which is very much in line with Section 24 of the Trade Union and Labour Relations Act.
Amendment 118J is rather important for employers, and I am surprised that some of them have not made more noise about this. The check-off system operates when the employer deducts the union’s subscription from the employee’s pay and, probably on a quarterly basis, sends the payment and an administrative charge off to the union. If the assurer finds any inaccuracies in some of the information and data that a union is holding, they may well be traceable to the employer—they may well be traceable to the payroll system or the way it is administered. In a sense, under Amendment 118J, we are asking, “What about the employer having to comply with investigations in this area launched by the assurer or the certification officer or one of his proposed inspectors?”. Amendment 118L would follow that up. It would provide the assurer with the ability to seek information from an employer for the same purpose.
Amendment 118K would put the obligation regarding record-keeping squarely where it should be if this provision goes through, and that is on a union nationally, not on the officer in charge of data handling in the union. It is not fair to put the obligation on a branch secretary, who may be a lay person. It is not fair to put it on the East Anglia regional committee, for example. The responsibility for good record-keeping should be very much on the national office, and I ask the Minister to look at that.
Lord Tyler
I apologise to my noble friend for quoting at such length the comments in the summer of the leader of the Labour Party. The Labour Party and its leader will benefit considerably if this part of the Bill, in whatever form, is enacted as there will then be a much more secure and robust form of record of all the membership of the unions. That is the point I was making.
Lord Monks
I thank the Minister for that disappointing reply and the noble Lord, Lord Tyler, for introducing an element which has not calmed or reassured anybody on this side of the House about the Bill. We thought that landing extra red tape on the unions was just an administrative muddle with a bit of political spite. Clearly, at least some on that side of the House have other motives in mind. It is rather difficult to follow the track. The Minister shakes his head, but that is not what he said. He had the chance to rebut the noble Lord, Lord Tyler, who introduced the party political funding item into this debate, and he has not done so. He had a chance to play the role of an assurer: he could have been a pioneer, but he blew it when he had that chance.
The Minister may have reassured some people. Employers must be fairly pleased. They will not be asked for any information. A big firm employing lots of people can screw up a payroll and so on. I see the noble Baroness, Lady Neville-Rolfe, in her place. Tesco has 140,000 USDAW members. I am not saying that Tesco would have screwed up a payroll, but if it did and somebody went to the assurer, it could not even be asked to provide information. The union will be the one in the dock.
Let us not pretend that this is some sort of friendly exercise, just tweaking the quality of union administration and helping people to get their records rather better when they are organising a construction site or when they are at the rough end of the retail industry. This is not about that at all, as the terms, to which we have drawn attention, on which an assurer can be got rid of involve going to the annual general meeting or a conference. It is almost as though this is a conflict and the assurer needs to be protected against what a normal auditor would be subject to, which is being fired by the decision of the board or, in the union case, the executive. The assurer is being protected on the suspicion that this person will be in conflict with the union.
That might be a reasonable assumption to make. The noble Lord, Lord Tyler, asked why people should be worried about it. It is because it will mean the job having to be done twice. Furthermore, he is an outside person who will get access to union membership records. The union prizes those records as well as their confidentiality. I will not press my amendment today. I will withdraw it, but noble Lords have not heard the last of this.
Lord Monks
Lord Monks
My Lords, this group of amendments covers similar territory to the previous debate, so I shall not go over all that ground again. The amendments continue to emphasise the extent to which the Bill engages with both Articles 8 and 11 of the European Convention on Human Rights and EU and UK data protection requirements. Amendment 144 limits who can be directed to comply with requests from the assurer. We emphasise the need to do that centrally rather than it being done by some voluntary branch secretary or district office. The responsibility should be at head office with the person who controls data.
Amendments 147 and 150 would allow an inspector to request information from employers. We have just been debating that important issue, which employers are hiding from. I do not see how an assurer could do his job properly without that kind of right. Amendment 151 aims to ensure that the inspector owes a duty to the trade union that is employing him or her, as well as to the certification officer, especially not to breach confidentiality. The amendment seeks to disqualify from acting in this role an inspector who commits breaches. Amendment 152 again tightens the parameters of what an inspector has to do to maintain confidentiality—not just to take all reasonable steps but to take all steps necessary. Without being repetitious, I beg to move.
Lord Whitty
My Lords, I have four amendments in this group that relate to roughly the same territory—Amendments 145, 146, 148 and 149. In the previous clause we were concerned about the access of the assurer and those who approach the assurer to the membership records of a trade union. My amendments relate to the certification officer and the inspectors, or staff, of the certification officer.
Obviously, when there is a complaint from a member about the way in which his records have been dealt with, the certification officer or his agent needs to be able to look at that part of the records. However, the totality of the records of the trade union needs to be protected in almost all circumstances. My amendments propose that the documents that can be demanded by the enforcement authorities will not normally include the complete register of members.
On earlier amendments, my noble friend Lady Drake and others emphasised how important this is to civil liberties. When you are organising a trade union against employer hostility and the employer can go to the authorities to find out who in his workforce, or which potential recruits into his workforce, are members of a trade union, that is a serious restriction on the right to join a trade union with no detriment.
Taken one stage further, this relates to the issue of blacklisting. It has probably been a serious underestimate that some 2,000 people have been blacklisted over the years through the mechanisms established by certain companies in the construction industry. If all that the employers needed to do was get sight of a list of registered members of a trade union, or if there was a requirement after a third-party complaint for the certification officer to produce that list, the incidence of blacklisting would go well beyond the confines of the construction industry and the other areas where historically it has applied.
There is an important civil liberties, human rights and data protection issue here. I seriously counsel the Government to look again at the provisions here and to build in some safeguards themselves. The last thing that they want to do, I should have thought, would be to transgress data protection provisions. I hope that they would not wish to transgress the European Convention on Human Rights or the ILO conventions on the freedom to organise, join or not join a trade union. Yet these provisions in this part of the Bill and the role of the assurer move in that direction, and we need far firmer protections than are in the Bill to ensure that that is not exactly what will happen.
Lord Monks
My Lords, I thank all noble Lords who took part in the debate. As the Minister gave his assurances about how seriously the Government take blacklisting, which has been so interestingly revealed recently, not least by my noble friend Lord McAvoy, I was minded that we might have found an actual role for an assurer. That is an assurer whose job it is to try to make sure that people in the construction industry are not blacklisted. Despite the increase in fines, the issue is finding out what people are doing. Somebody who went in to have a look at payrolls, private e-mails, and so on, could probably find that out.
That is a problem that the Minister acknowledges exists. We have not got a problem in the area of union membership and union membership records—or not one that is easy to do very much about, particularly in industries that are casualised. I will just say that the nature of the assurer in the union context is almost, “I’ve got to be reassured that your systems are okay”. That will be a rather adversarial position; not a consensual one, as the Minister is presenting it. It will be adversarial, especially when people are not exactly sure what will happen to the information. Why do they need that information if there is no trouble and no complaints?
The Minister’s point is that the certification officer and the scrutineer have access, so why not an assurer? The difference is in the nature of the relationship. The assurer would have a much more adversarial position than the one that those two have. Essentially, the assurer is saying, “I don’t really trust your records until I have had a very good look”. That is our major problem with it.
I will withdraw the amendment, but we will no doubt return to the matter later in our proceedings.