Employment Rights Bill (Sixth sitting)

Sarah Gibson Excerpts

Committee stage
Tuesday 3rd December 2024 Public Bill Committees

[Sarah Gibson (Chippenham) (LD)]

As I am sure the Minister knows, the Liberal Democrats as a group are convinced that a lot of elements of this Bill go a long way towards strengthening workers’ rights. There is no doubt about that. However, when I see these amendments and listen to the comments of Opposition colleagues, I am constantly concerned about what I am beginning to see as the plight of small and medium-sized businesses that are not being taken into consideration. This amendment alone is hugely complicated to understand. I have visions of contractors and small businesses in the construction industry in my constituency, who quite often are the employer, coming home after a long day’s work to do the admin side of their business and trying to unravel this. I highlight the construction industry because fixed-term contracts for employees are not only common, but incredibly useful. Building projects—like this one, with the works we are doing here—do actually come to a finite conclusion, and a fixed-term contract is therefore appropriate. I express my continuing concerns about this matter and some of the other amendments in connection with small businesses.

[Michael Wheeler (Worsley and Eccles) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Stringer. I will speak to these Government amendments collectively, because although they are incredibly technical, we must not lose sight of their purpose, which is to promote good employment. If there are loopholes and readily available routes by which employers can avoid the measures laid out in this Bill, we will see good employers undercut and workers not feeling the benefits. I welcome this as part of the Government doing their job to strengthen the legislation by introducing well thought out amendments to close loopholes and ensure that it is as strong as it can be. I commend this and the other amendments as being not simply technical—although they are—but part of what really gives the Bill teeth in achieving its purposes.

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[Jon Pearce]

Yes, I would, and it is entirely right that it should be. We have to have a level playing field within the UK; otherwise, we see all the perverse incentives that hon. Members, including the shadow Minister, the hon. Member for Mid Buckinghamshire, are keen to avoid. We cannot have a two-tier workforce.

Returning to my original point, law is often complex in the way it is written, but that does not mean it will be complex in its application. It will only be complex where there are attempts to avoid it. It is absolutely right that the law is tight on this so that we do not have huge amounts of avoidance within the business sector from unscrupulous employers. Most employers, as we know, do not exploit zero-hours contracts, for example, so it is entirely right that we make sure that those who wish to exploit them cannot.

[Sarah Gibson]

The hon. Member for High Peak quotes an equally incomprehensible piece of legislation. It occurs to me that some time ago, the banking industry was accused of a similar problem when it spoke to its clients and was obliged to improve its conversation and make sure that it was intelligible. Surely this is an opportunity for us to be able to do the same. If we are going to apply legislation to sole practitioners, effectively, who are taking on one or two employees, is it so much to ask that we do not have one single sentence that lasts an entire paragraph?

[Jon Pearce]

Will the hon. Lady give way?

[Sarah Gibson]

I will not for a second, but will afterwards, if that is okay. I have spent the last 20 years deciphering the Town and Country Planning Act 1990, and recently had the pleasure of teaching two postgraduate students the Fire Safety Act 2021. Neither of those two pieces of legislation are easily understandable, and it does not help the industry that I know so well, which is employers who come straight out of school and into industry. They do a fantastic job, but they do not need added complication. I believe that the hon. Member for Bridgwater makes a good point in saying that it is not beyond us to make legislation slightly easier to read. Sorry, I was going to give way.

[The Chair]

Minister, would you care to respond?

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[Laurence Turner]

I will not keep the Committee long. A lot has rightly been said about the need for certainty for business, but we should remember that the other side of the coin is the need for workers to have certainty. I was contacted recently by a constituent who works a zero-hours contract in the hospitality sector. He is unable to get a mortgage because the bank will not grant that facility to him due to the nature of his contract. At the level of the individual, this means economic activity and family planning being put on hold.

In parts of the economy, there are employment situations—we do not, of course, tar all employers with the same brush, but if there were no bad employers there would be no need for trade unions—in which people are turning up to work, sometimes in digital form, to find shifts being mediated through applications, not even through people. It is the 21st-century equivalent of a foreman standing at the factory gate and allocating shifts on an arbitrary basis. We have heard today about the potential, which is too often realised, for favouritism and abuse of that facility.

We have had good debate about a number of details regarding the changes in the Bill. The changes in clause 1 will be welcomed by people who work in the retail sector, including in my constituency, and in other sectors that have high rates of zero-hours contract working, including the care sector. I very much welcome the clause.

[Sarah Gibson]

Despite some of my concerns, I would like to lend my support to the clause, because the guarantees for workers are important. I caveat that by saying that the guidance for SMEs must be clear and must come out soon, so that there is less concern in the business community about taking on staff. Currently, I see an unintended consequence in SMEs, certainly in the near future, not taking on staff because of the fear of additional costs.

While I am on my feet, I would like to make a correction for the record in respect of this morning’s debate. In the debate on amendment 137, although the shadow Minister made a comment about this in his closing speech, it was not my intention to suggest that the Liberal Democrats wish to alter the current definition of SMEs from being 249 employees. I want to make sure that is clear.

[Justin Madders]

To pick up on the points made by my hon. Friend the Member for Birmingham Northfield, this is about who we are trying to help. This clause is primarily about low-income workers who do not currently have the security and certainty of regular hours. They are more likely to be young, female or from an ethnic minority background. We have heard about the real impact that can have and about the power imbalance when an employer holds all the cards. To use my hon. Friend’s imagery, it is effectively like pointing to people at the factory gate and deciding whether they get work that day or not. We must move on from the indignity of that arrangement.

I welcome the support from the Liberal Democrats. It is worth saying that there was general, albeit caveated, support from the witnesses we heard from in last week’s evidence sessions.

I will tackle head-on the shadow Minister’s criticism about the lack of clarity and the need for certainty. Of course we want to give business certainty. I am sure that after the last few years of Conservative Government, we are all crying out for certainty, and there will be certainty. We are at an early stage of the legislative process for this Bill. It will be taken through Committee and through the Lords, and then there will be further consultation, secondary regulations and codes of practices, after which the laws will be implemented. As the Liberal Democrat spokesperson, the hon. Member for Chippenham, said, there is anxiety out there for businesses, but we are a long way off introducing this legislation, because there is so much more to do, and it is important that we do it. We want to get it right, we want to get clarity and certainty, and we want to ensure that this is an effective piece of legislation.

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[Greg Smith]

There are a number of options that could be looked at. The time set out in the regulations could be much more flexible. There could be safeguards for force majeure circumstances, which is common in a lot of contracts. There is no reason why that could not be in legislation. Or if the Government want to go down this path, albeit it is not something that Conservatives would propose, perhaps a more elegant way of going about it would be some sort of legislation on compulsory insurance against such eventualities that ensured that both sides were able to benefit—that the employee still got paid at least something, if not their full expected wage for the day, but the business was not directly out of pocket either. That would have to be tested in the insurance industry to see where premiums would come out, because they may well be unviable, but I gently suggest to the Government that it is a tyre worth kicking.

I conclude with a point I have made many times: this has to be about flexibility in real-world circumstances.

[Sarah Gibson]

The Minister made an extremely good point about the security that is required. It should not be an arbitrary 48 hours that is given. Specifying the time for each sector, presumably under guidance, would perhaps be the most appropriate thing.

I have talked many times to people in my constituency who work in the care sector and are employed to visit people in their own homes. They are given a start time for a shift and are quite often told that they will work a certain number of hours, but it is not clear until they turn up to the shift how much of a gap there will be between the times at which they are getting paid. That can leave them with shifts that last a considerable time but contain a gap of several hours, during which they might be miles from home and it might not be worthwhile going home for lunch, so they incur costs on their own time.

I welcome the attention to the lack of clarity about shift working specifically for home visits in the care industry. This is something that we need to look at. Perhaps there needs to be guidance on the time for each sector, because each sector has its own issues. That is certainly true when one looks at hospitality.

[Anneliese Midgley]

I am sorry for referring to the shadow Minister as “you” earlier, Mr Stringer; I was not suggesting that you needed to clarify whether you thought workers should shoulder all of the burden.

I want to remind hon. Members of some evidence that we were given last week in support of the right to reasonable notice of a shift. Matthew Percival from the CBI said that

“there are areas where the Bill can be a helpful step in the right direction. To give a few examples, we have previously supported the idea that it is wrong that you should turn up for work expecting an eight-hour shift, be sent home after two hours and only be paid for two hours. There should be a right for compensation there.”

Jane Gratton from the British Chambers of Commerce said:

“As Matthew said on the compensation of shifts, we certainly support that, and we would be very happy about the fair work agency to create a level playing field and measures around workplace equity.”––[Official Report, Employment Rights Public Bill Committee, 26 November 2024; c. 13, Q6.]

Allen Simpson from UKHospitality said:

“Again, reasonable notice is an important principle and there should be protections.”––[Official Report, Employment Rights Public Bill Committee, 26 November 2024; c. 43, Q39.]