Employment Rights Bill (Second sitting)

Peter Bedford Excerpts

Committee stage
Tuesday 26th November 2024 Public Bill Committees

[Chris Law (Dundee Central) (SNP)]

Q I am focusing still on fire and rehire. Listening to the comments made in the last five minutes, I think the consensus is that we want to see the end of fire and rehire, and I completely support that. However, when you look at the detail of the Bill, there could well be a loophole to allow it to continue. There is a clause that says that there is an exception for those in “financial difficulties”. What are your thoughts on that? For example, who defines what the financial difficulties are and who decides how that is to be negotiated? For me, using the term “financial difficulties” is a loophole to enable any employer to say, “We are going to have to let you go in this circumstance.” Do you agree with that, or do you think more work needs to be done on it?

Mick Lynch: I think we have to be very careful, because companies are very good at creating entities that are subsidiaries of subsidiaries that are based in other jurisdictions, with all sorts of measures that are far too complicated for a simple soul like me. I would like the reporting of a business to be very straightforward. Everyone will know whether a business is failing, and fire and rehire for a failing business is not going to work in many instances. Certainly on the onshore side, it is likely that the business will fold before such measures can be brought. And of course it is very difficult to do what P&O did because it relies on bringing people from overseas to replace people.

Grant Shapps, last year, or the year before, said at one stage that he was going to replace all the railway workers in Britain, so there was actually a Government Minister promoting fire and rehire during our dispute. So I think we have to be very careful not to allow loopholes. I know that accountants and auditors are very good at creating loopholes, but as far as possible it has got to be plain for the layperson to see whether a business is struggling and has genuine business needs to get any hint of an exemption, and they should be very rare indeed if they are to exist.

Martyn Gray: Quite simply, if directors can sign off the business as still remaining as a going concern, fire and rehire should not be an option. If we are looking at a scenario where directors are happy to say under companies legislation that it is a going concern but they need to do a complete restructure, strip away the employment rights, strip away the benefits, strip away working conditions—things that have been long fought over for many years of negotiation or long thought over for many years of discussions: all the benefits that sit within employment contracts—and strip them back to a minimum, that business is not in a position where it can consider itself a going concern. So I would set a really high threshold and then allow for scrutiny from the relevant bodies. If it turns out that that could have been avoided—fire and rehire in those scenarios—it is clear that those directors should not have gone through that and there must be consequences. So there is probably room for improvement, some tweaks and changes, but I would put it quite simply.

Gemma Griffin: A classic example is that during covid, overnight 80% of our business was gone and we had vessels that were worth a lot of money and a lot of crew. There were the inevitable discussions on redundancies or just stopping and what was going to happen. We made a deal with Nautilus and RMT that we would work on this together, because we were hoping things would come back. It was only in year two that we really had some sense that things would come back. But one of the things that we did was collectively go out to our workforce and say, “It is these jobs versus how about if we work together and we do a pay freeze for the two years and we just take that pain together so that we can have the jobs at the end of it.” And we did that together. If something is going to go bust, it is going to go bust. But if there was a way of keeping the money in a better way—suspending the training and non-essential stuff—we made operational changes. It is too easy to leave it in as a loophole. That loophole is like you are just taking the profits out of the pockets of your people. So I think we need to be careful there.

[Mr Peter Bedford (Mid Leicestershire) (Con)]

Q Mick, you mentioned that you felt there should be further legislation, which suggests that the Bill is falling short. Could you elaborate on what you would like to see the Government do if the Bill is falling short?

Mick Lynch: Well, we would like it very straightforward that there is going to be provision—an amendment—for sectoral collective bargaining. If there is proper sectoral collective bargaining across the economy, many of the issues that people are dealing with as individuals—individual rights, which they have to enforce for themselves, in many cases—will be dealt with. There is a lot of discussion about probation. We have probation agreements with every employer that we deal with, and we do not defend people who are incompetent or incapable. We have a process, and if we have sectoral collective bargaining, all those things will be covered.

[The Chair]

Order. I am sorry, but that brings us to the end of the time allotted for the Committee to ask questions. On behalf of the Committee, I thank all our witnesses for their evidence.

Examination of Witnesses

Paul Nowak, Maggi Ferncombe, Dave Moxham and Hannah Reed gave evidence.