Unpaid Work Trials

Stewart Malcolm McDonald Excerpts

Tuesday 5th February 2019 Westminster Hall

[Mr Philip Hollobone (in the Chair)]

Before we begin the debate, I advise hon. Members that we are expecting a Division in the House within the next 10 minutes, upon which this debate will be suspended for 15 minutes to enable hon. Members to vote. I call Stewart Malcolm McDonald.

[Stewart Malcolm McDonald (Glasgow South) (SNP)]

I beg to move,

That this House has considered the use of unpaid work trials at the outset of employment.

Thank you very much, Mr Hollobone; it is always a pleasure to see you in the Chair. Hon. Members will know of my longstanding interest in this issue, having introduced a private Member’s Bill on it after the 2017 election: the Unpaid Trial Work Periods (Prohibition) Bill. Unfortunately, and I hate to start on a sour note, my Bill was talked out by the Minister’s predecessor, the hon. Member for Burton (Andrew Griffiths), when he was in post. I am an optimist, however, and I am optimistic that the new Minister will drive us in a different direction, see the gravity of the problem, and bring forward the necessary legislation to prevent that exploitation from continuing.

There are many people—not just in this House, but outside it as well—whom I should thank for their input during my preparations for that Bill and for this debate, and during my long campaigning on the issue, but I will single out one campaign for mention: Unite’s “Better Than Zero” campaign. It has been at the forefront of not only challenging the use of unpaid work trials, but putting forward a credible alternative to exploitative work practices, with a particular focus on the hospitality sector. I encourage all hon. Members to support that campaign, particularly its hospitality charter.

I will outline exactly what is going on and why it is a problem that needs fixing. Unpaid work trials—the period between applying for a job and being given the formal job offer—are at the heart of what I want the Government to fix. I want them to fix the fact that that part of employment law is entirely unregulated, although I am sure the Minister will dispute that when she gets to her feet. There is a deficiency in the National Minimum Wage Act 1998, for which, in fairness, I do not blame Labour. Nobody saw it as an issue then and has not for the last 20 years, but it is a deficiency that needs to be fixed.

During my research for this debate and the preparations for my private Member’s Bill, many hundreds of people got in touch to give me their personal experiences of what it is like to take part in an unpaid trial shift. I myself did it when I was younger, as, I am sure, did many other hon. Members. Unpaid trials range from perhaps a couple of hours in a coffee shop or a hotel, for example, right up to the extreme end, with the most extreme that I have come across being a 40-hour working week, where people tried out for a job that they would not be paid for and had no guarantee of securing permanently.

[Patricia Gibson (North Ayrshire and Arran) (SNP)]

I congratulate my hon. Friend on all the work that he has done to bring this important issue to the public’s attention. More than half of people know someone who has experienced an unpaid work trial or have done one themselves. Does he agree that that shows the scale of the problem and the abuse of workers that is taking place?

[Stewart Malcolm McDonald]

Indeed. Although there are no Government or trade union statistics on that, it is a problem that everyone knows exists, because we have either done it ourselves or know somebody who has.

Not only do people work—as in the case that I mentioned—for up to 40 hours without pay when trying out for a job, but we have the vicious situation of people being offered work trials for jobs that do not even exist. That can take the form of a job being advertised so a business can get itself through a busy period such as Christmas, or the wedding season in the spring time if the employer is a hotel. It can also be used to cover staff sicknesses. People are being taken advantage of when they are asked to come in and try out for jobs that there is absolutely no chance of them getting, because all the employer wants to do is cover shortages in their own rota.

[Paul Blomfield (Sheffield Central) (Lab)]

I congratulate the hon. Member on securing the debate. He talks about some of the more extreme examples. He may be shocked to hear the experience of a constituent of mine. She had a seven-day unpaid work trial, but was also told that if she was subsequently employed and left within the first year of employment, she would have to repay the company for the cost of her training and her Disclosure and Barring Service check.

[Stewart Malcolm McDonald]

Rather unusually, I am blown away and have no words. I have never before heard of that kind of thing happening, but it does not surprise me at all. Imagine how dispirited and depressed that kind of situation leaves an applicant feeling, particularly if they have applied for job after job and have got nowhere, often with no feedback from those from whom they hoped to secure employment.

[Dr Dan Poulter (Central Suffolk and North Ipswich) (Con)]

The hon. Gentleman has clearly outlined some worrying issues. I do not think anybody present would support somebody not being paid for a one-week work trial if that is how it is badged. There are also legitimate concerns that, as part of the interview process, people may be asked to perform certain work tasks to see whether they are suitable for the role. How would he differentiate between the unethical practices that he outlines and genuine job interview and job selection processes?

[Stewart Malcolm McDonald]

My Bill deals with the very scenarios that the hon. Gentleman mentions. I want to make it clear that I am not against trying people out for a job. The Bill is quite clear on that, too. I am against the use of unpaid trials to exploit people. Later in my speech, I will mention a business that has changed its practices as a result of this debate approaching, which might address the hon. Gentleman’s concerns.

Some employers know that the practice is wrong but are indulging in it. I know that they know it is wrong, because they changed their practices when my Bill was introduced last year. I will give two examples. The first, believe it or not, is the BBC. I had been told that the BBC was taking advantage of young freelancers; abusing their time, talent and energy; involving them in the production of programmes; and doing so through the guise of an unpaid trial period. I wrote to the BBC about the matter and, as a result, it has stopped that practice. Why? It knows that it is exploitative.

Aldi has changed the way that it interviews and recruits people. It has taken away what might have been thought of as the interview element, whereby someone carried out a work task. Instead, it now has a shorter interview period that involves shadowing someone around the store to see exactly how the business works and, crucially, so that the applicant can determine whether the job is for them. That is a better way to recruit people.

My Bill would also have given some of the cards to the applicant who, it strikes me, holds very few in the entire process. My Bill would have made it clear that employers offering a trial shift had to be doing so for a job that actually existed; that when the trial period started and finished had to be stipulated in black and white; and that applicants knew that, however they got on during the trial, the employer would give them proper feedback as to whether they had got the job. My Bill was all about empowering applicants and making it clear to them that the law is on their side, rather than it being deficient and too often working against them.

When I introduced my Bill, the Government were of the view that the law was not deficient and dealt with these matters as it was. In fairness to the new Minister, she has brought forward guidelines on the use of unpaid work trials. That is welcome—I get that change often happens in small steps—but I am afraid that it is not enough. She is, I am sure, unsurprised to hear me say that. We know that millions of people up and down the UK are crying out for proper legislative change that will back them when they go for a job. At the minute, the law absolutely does not do that. That can be evidenced by the fact that there has never been a single fine—

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On resuming—

[Stewart Malcolm McDonald]

Hon. Members will be glad to know I am bringing my remarks to a close, to allow the debate to begin properly.

It is my understanding that the Government believe the current law is sufficient, presumably with the addition of their recently published guidelines. However, the evidence suggests that it is not: there has not been one fine, prosecution or even public shaming of a company or employer that has used unpaid trial shifts, particularly in the most pernicious and exploitative fashion, in the history of the National Minimum Wage Act.

I am sure many Members will wish to share the experiences of their constituents; I would like to share just one. A mother whose son had gone through an unpaid work trial said:

“My son was asked to do a trial shift in our local restaurant. The manager who was on shift did not even speak to him when he was in! He was left in the bar with no direction and when he tried to help the others he was told to get back behind the bar! He wasn’t paid a penny for his time. The same restaurant had already done the same thing to a friend of mine’s son except it was for a kitchen porter and he did 4 hours, no pay and again at end of his shift he just left, waited over a week with no job offered.”

I cannot expect the Government to legislate against obnoxious behaviour, which surely that example represents, but they can legislate to prevent unpaid trail shifts being used in such an obnoxious fashion.

Some may say that I am being partisan, but I think I make an accurate observation: this Government are utterly out of ideas. I am offering them a free idea at a time when we are asked to believe that the Prime Minister wants to improve and enhance workers’ rights in one fashion or another. Assuming there is no general election between now and the upcoming Queen’s Speech in June, I plead with the Minister to do everything she can to ensure legislation is brought forward in one form or another, either in this Session or in the Queen’s Speech later this year, to ensure that we end the use of unpaid work trials.

When I was lucky enough to be picked in the ballot for private Members’ Bills, inevitably I was bombarded by outside interests saying what they would like a Bill to achieve. Obviously, any Member who finds themselves in that position wants to bring in a Bill that can genuinely make a difference to people’s lives. There are millions of people, particularly young people, up and down this country who have fallen victim to this practice day after day for many years. Even with the new guidelines, millions more will fall victim to it.

Knowing what we know, it would be an utter dereliction of duty for this Parliament and this Government not to act. I do not look to this Parliament to solve many problems—hon. Members understand my political view of it—but it can solve this problem. I ask the Government to get serious and start solving it.

[Several hon. Members rose—]

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[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Kelly Tolhurst)]

It is a pleasure to serve under your chairmanship, Mr Hollobone. I congratulate the hon. Member for Glasgow South (Stewart Malcolm McDonald) on securing this important debate. I am proud to serve as the Minister responsible for the national living wage and workers’ rights, and I am pleased to be responding to the debate. I fully agree with the hon. Gentleman that it is wrong to exploit workers through unpaid work trials at the outset of their employment. Workers have the right to be paid the minimum wage when they are deemed to be working, and this must be upheld.

The Government are committed to building an economy that works for everyone through the national minimum wage and the national living wage. We will continue to ensure that the lowest paid in our society are rewarded fairly for their contribution to the economy. All businesses, irrespective of their size or sector, are responsible for paying the correct minimum wage to their staff. The vast majority of responsible employers ensure that they get it right.

The hon. Gentleman and other hon. Members raised examples of constituents and others who had been disadvantaged. Having heard the details, I can say that it is highly likely that those practices were illegal. An individual’s entitlement to the minimum wage depends on whether they are deemed to be a worker. If they are a worker, their employment must pay at least the relevant national minimum or national living wage. Our legislation is clear on that.

Many individuals participating in work trials would be considered to be workers. Therefore, they are already protected under existing legislation and are eligible to be paid the minimum wage from the start of their employment. An employer may wish to test an individual’s skills using a range of kitchen knives in a restaurant kitchen. That would probably have little or no value in terms of work for the employer, so would not require payment at the relevant minimum wage rate.

Clearly, the circumstances of each particular case would need to be considered to confirm entitlement to the minimum wage. However, the case of the 40-hour unpaid trial is, in the view of my Department, likely to be excessive and, therefore, against the law. Similarly, new recruits who are required by their employers to spend time at the outset of their employment undertaking training are entitled to the minimum wage for that time.

The hon. Member for Glasgow South raised the issue of exploitative unpaid work trials in his private Member’s bill of March last year. The Government recognised that concerns had been expressed in the House and in the media. Therefore, we issued new guidance on unpaid work trials on 3 December last year, to provide further clarity for employers and workers. The guidance aims to ensure that workers, especially young people in the hospitality and retail sectors, are not exploited through unfair and excessive unpaid work trials. The guidance sets out a number of relevant factors that should be taken into account, such as the duration of the trial and whether the employee is deriving economic value from the activity.

The Government have clarified their view that work trials that are reasonable, not excessive and clearly part of a legitimate recruitment exercise do not require payment at the relevant minimum wage rate. For example, an employer may wish to test an individual’s skill in a restaurant kitchen through a short trial before hiring that person. That would probably have little or no economic value for the employer, so would not entitle the applicant, but it may well lead to a job offer for the individual. However, unpaid trials are not permitted if they are part of a genuine recruitment process, if they are excessive in length or if they are simply for the financial benefit of the employer.

[Stewart Malcolm McDonald]

I have no quarrel or disagreement with anything that the Minister has just outlined. The guidelines that she has produced are, no doubt, admirable. What is her objection to underpinning them in statute?

[Kelly Tolhurst]

As I have already said, we have an enforcement system for the national minimum wage, which, with the guidance, is focusing on targeting the employers that we need to target. We need to recognise—I was going to come to this point later—that in 2017-18, Her Majesty’s Revenue and Customs investigated and took action against more than 1,000 employers, raising £15.6 million, and affecting over 200,000 workers. That shows that the enforcement work is taking place. HMRC will investigate every worker complaint.

[Stewart Malcolm McDonald]

I am glad that HMRC investigates, but how many of the cases that the Minister has mentioned, in which money has been clawed back by workers who have been deprived of money to which they were entitled, took place in a period that would be considered a work trial, as opposed to when the worker had formally signed a contract and started a new job?

[Kelly Tolhurst]

As part of HMRC’s involvement and enforcement of the national minimum wage, it investigates a number of breaches, including unpaid trials. I can tell the hon. Gentleman that HMRC is currently actively investigating companies in which there is a suggestion of unpaid work trials. Obviously, those investigations are currently ongoing, on the back of the legislation and the guidance that we offered.

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[Stewart Malcolm McDonald]

The more things change, the more things stay the same. We have a new Minister, but that was by and large the same speech we heard when my Bill was talked out last year. I want to address one issue that the Minister mentioned. I have no quarrel with the workers at HMRC—my partner is an employee, so I would know if I had a quarrel with workers there.

I am afraid that all the things the Minister outlined that people can do if they feel they are being exploited go partly to the heart of the problem. Why is the onus always on the person being exploited to run around and try to get somebody to take action, when the Government could do that in statute?

I am always grateful to hear the hon. Member for Strangford (Jim Shannon). As a DUP Member, he has greater access to the ears of the Government than I have, so as we approach the next Queen’s Speech, I plead with him to take the issue forward.

The hon. Member for Glasgow North East (Mr Sweeney) questioned whether Ministers had any idea or experience of what we were talking about. Yes, they do; the Minister’s predecessor was guilty of offering unpaid work in his office.

It has been a good debate and there is clearly much that we agree on. There is even much that the Minister and I agree on, but I plead with her to do something meaningful and introduce legislation. Let us stop putting the onus on the person being exploited and, for once, give job applicants some of the cards to hold.

Question put and agreed to.

Resolved,

That this House has considered the use of unpaid work trials at the outset of employment.