Enterprise and Regulatory Reform Bill

Lord Phillips of Sudbury Excerpts

Wednesday 6th March 2013 Lords Chamber

[Baroness Turner of Camden]

My Lords, Amendment 81 stands in my name. At Second Reading and in Committee, I opposed this clause. The Government have introduced some amendments to the original, but they do not alter the Bill substantially. It would still alter the Heath and Safety at Work Act in a way that is not to the advantage of an injured worker. Section 47(2) of the Act says:

“Breach of a duty imposed by health and safety regulations shall, so far as it causes damage, be actionable except in so far as the regulations provide otherwise”.

In practice, I am advised by the Association of Personal Injury Lawyers, to which reference has already been made, that this means that if a worker is injured and can prove than an employer has breached a statutory duty, he is entitled to claim compensation. This is the basis upon which many workplace injury cases are usually brought.

The law is clear and well understood. It is the basis on which health and safety legislation has been drafted and passed by Parliament. This is the provision which the Government seek to alter. Without this provision, the injured person would be obliged to rely on the law of negligence, which would be much more difficult. Take the case where a worker has been fatally injured after working with faulty equipment. At present, the family need only prove that there had been breaches of statutory regulation in order to claim compensation. Under the provisions of the Bill, the family would have to go much further and prove that the employer knew that the equipment was faulty and did nothing about it. That would be much more difficult than proving that regulations in place to protect the worker had been breached.

According to the Government’s own figures, the provisions in this clause will affect 70,000 cases in England, Wales and Scotland. That is quite a number of injured workers. There are many industries—construction is one—which are inherently dangerous. I urge noble Lords to look at London: it has masses of construction sites, full of scaffolding and workers working on them. The workers who regularly endanger their safety on these sites deserve proper protection. If the Government are really concerned about safety, they should strengthen the HSE instead of cutting resources and thus cutting HSE inspections, which are so necessary to maintain health and safety at work.

This clause, if enacted, will encourage employers to abnegate their responsibilities and rogue employers will get away with it. What about insurance? Employers are expected to have employers’ liability cover. It is fairly clear that insurance premiums will increase as a result of this legislation. Do the Government really believe some of the assertions in the trade press that we are becoming a compensation culture with many unjustified claims? I do not think so.

I once worked in the claims department of a large insurance company. Injured workers then had quite a tough time sometimes getting adequate compensation for their injuries. I thought at the time that they needed representation in order to get justice. Unions, of course, provide a skilled service for their members in such situations; my own union has a good and important legal department. However, not everyone is in a union. Even now, workers individually sometimes have difficulty in securing compensation. With this clause enacted in legislation, it will be much worse: the burden of health and safety will be transferred from the shoulders of well resourced employers to vulnerable workers, which is unjust and unfair. It takes the law on workplace safety back to Victorian times, beyond the landmark 1898 law, under which it became possible to claim compensation where employers had breached their statutory duty.

I oppose this clause; it is unfair and unjust and in the end will cost the taxpayer much more in support for injured workers unable to achieve compensation. I am opposing it because I want to send a message to the Government that they should not attempt to interfere with established procedures which have served people well and are respected. They should not attempt to do this, and therefore I oppose the clause completely.

[Lord Phillips of Sudbury]

My Lords, I suggest to the Minister that there is a lifeline to the Government in this group of amendments, particularly Amendment 80B in the names of the noble Lords, Lord McKenzie and Lord Wigley. It requires the Secretary of State to set up an independent panel to carry out a review of what will become Section 62. I agree with all that has been said so far in this debate; in particular, I think the Government would be very wise to accede to the proposal for the independent panel because there can be few provisions in our whole legislation that are more complex than Clause 62 and the multitudinous amendments that it makes to Section 57 of the Health and Safety at Work etc. Act.

I also draw to the Minister’s attention—if it needs drawing, and I am pretty sure it does not—that the litigation that could flow from Clause 62 as it stands could be formidable, not least in terms of European law. The impact of the law of the European Union in this area of life is very considerable indeed. Professor Löfstedt, in his 2011 review, reported that there were more than 200 health and safety regulations in this country that were affected by EU law. As we all know, where there is a clash, EU law will prevail over domestic law.

The impact on employees of this change in the law could be different from the one that the Government are currently arguing on. It is perfectly certain that if you take away absolute liability for breach of statutory duties and leave it with the common law of negligence, you are, as night follows day, encouraging irresponsible employers—and there are a few, I am afraid—to take risks that will redound to the disadvantage of their employees.

As has already been said this afternoon, suing in this area of law can be extraordinarily difficult. I should have first declared my interest as a solicitor. My firm, Bates Wells and Braithwaite, does a considerable amount of this type of work, as I also have in my professional life. It can be formidably difficult for an injured employee to secure redress from an obdurate employer who is willing to string out the whole business, force the employee into court, and also force him or her into the hands of the no-win no-fee system, which itself has many drawbacks.

I sincerely hope, therefore that the Government will listen to what is being said this afternoon and will take a prudent and practical course that will not hold back this legislation for long, because Amendment 80B sets a time limit for the report of the panel. I hope they will also address to some extent the failing of the Professor Löfstedt review to engage in the sort of consultation that I believe in the view of any Member of this House should have been undertaken prior to the publication of the outcome of that review. I hope, for all those reasons and many others which I hope we will hear, the Government will take the proper course.

--- Later in debate ---

I thought it was important to address those important and direct questions directly. Having covered all the points, it is for those reasons that I hope that the noble Lord will withdraw the amendment.

[Lord Phillips of Sudbury]

My Lords, the Minister twice said that where companies had done nothing wrong, they could still be caught and made liable under the absolute liabilities of health and safety legislation. Surely, if it is indeed the case that the legislation is so drafted that a company that had done nothing wrong is liable, the answer is to introduce a qualification to that legislation, along the lines mentioned by, among others, the noble and learned Lord, Lord Hardie, so that the situation does not recur. Would that not be a better way of proceeding, as Professor Löfstedt suggests and as the panel would enable, than to take a step into the deep unknown, with consequences that many of us fear?

[Viscount Younger of Leckie]

I thank my noble friend for that point, which is simply noted. It does not change the views that I have expressed about where we are with the clause, but it was valuable to hear what he had to say.