Employment and Trade Union Rights (Dismissal and Re-engagement) Bill

Sally-Ann Hart Excerpts

2nd reading
Friday 22nd October 2021 Commons Chamber

[Barry Gardiner]

I am happy to respond to the hon. Lady’s question. We chose the figure of 50 employees, and the Bill refers to 15 or more employees being affected by these changes, because that marries up with the existing legislation on redundancy and other matters. Fifty is the figure that has been chosen by the Government in previous legislation. I have tried at all points to make the Bill technically proficient, so that it intersects with all the other legislation in this area.

The hon. Lady asked whether this was happening in smaller companies. Sadly, it is, and I would dearly like to see it outlawed there also. We have made the Bill commensurate with all the other employment legislation, which is why the figure of 50 was chosen.

[Sally-Ann Hart (Hastings and Rye) (Con)]

May I pick the hon. Gentleman up on the point about capitalism? Throughout the past few years, before Brexit, we had an influx of European workers, and that undermined the wages of British workers. Does the hon. Gentleman not agree that companies will now have to value their workers better? If they do not pay them properly—if they try to undermine our British workers—there will not be 10 cheaper European workers in the line to take their jobs. There will not be a surplus of workers, and a rebalance of capitalism will therefore ensue.

[Barry Gardiner]

May I just remind the hon. Lady that the comment about capitalism was not, in fact, mine but the Leader of the House’s? I understand her fundamental point, and from it I take that both she and I want to see wages in this country rise to an appropriate level so that every person and every family feels they can put a roof over their head and food on the table, and feels secure in their life—although she will have voted one way on Brexit, and I will have no doubt voted the other way, we would both welcome a move towards a society in which that is possible. The Bill is about levelling up and stopping the practice whereby, at the moment, many hundreds of thousands of workers in this country are seeing their wages levelled down, which is why it is so important that we get legislation.

I have set out that there is a problem of morality and economics. How can we fix it? Back in June, when I sat down with the Under-Secretary of State for Business, Energy and Industrial Strategy, the hon. Member for Sutton and Cheam (Paul Scully), he made it clear to me that the Government were “not minded to legislate.” That was even after the ACAS report “Dismissal and re-engagement (fire-and-rehire): a fact-finding exercise” was published, which may appear surprising given that ACAS reported examples of what participants in its survey

“regarded as employers using the crisis opportunistically as a ‘smokescreen’ to diminish workers’ terms and conditions; and the use of fire-and-rehire as a negotiation tactic to undermine or bypass genuine workplace dialogue on change.”

ACAS made it clear in the report that, although the Government were happy for it to outline the findings from such a fact-gathering exercise,

“Acas was not asked to present recommendations to government.”

If not legislation, what? The Minister advised me that the Government are now asking ACAS to recommend how they might strengthen the guidelines to business. I am a believer in guidelines, and good businesses tend to follow them, particularly if they are clear and if other businesses are doing the same. The problem comes when unscrupulous businesses are not adhering to those guidelines and gain a competitive advantage from that non-adherence. There then often follows a race to the bottom in which the good company feels forced into bad practice.

I do not believe that any manager goes into work thinking “I am going to do something noble and fine this morning: I am going to tell my 300 employees that they will be fired unless they accept a pay cut of 20%, even though our company is making record profits.” That is why I believe guidelines are not a solution. Managers at Jacobs Douwe Egberts, the coffee people in Banbury, made record profits during the pandemic, when coffee consumption increased by 40%. While the managers awarded themselves large bonuses, they demanded wage cuts of up to £11,000 from 291 staff. The truth is that guidelines are not going to change the practice of such managers. Only by putting good practice into statute will companies be prevented from bullying their workforce by using the threat of fire and rehire, and only if those tactics are outlawed will good companies not feel the competitive pressure to behave just as badly.