Examination of Witnesses (Questions 1-19)
TUC AND T&GWU
24 JANUARY 2006
Q1 Chairman: Ladies and gentlemen, thank
you for your attendance today. Can I, as always, begin by asking
you to introduce yourselves for the record?
Ms Veale: Thank you very much
indeed for inviting us. My name is Sarah Veale and I am Head of
Equality and Employment Rights at the TUC. Could I also just say
to the Committee that with a different hat on (which I am not
wearing today) I am also a member of the Acas Council.
Mr Nunn: I am Simon Nunn. I am
Deputy Head of Research at the Transport and General Workers'
Union.
Q2 Chairman: There is a universal
rule of politics that when everyone agrees, they are wrong—apart
from the Dangerous Dogs Act! All the evidence we have received
today is universal in its praise and support for the work of Acas.
Why?
Ms Veale: I am not sure I agree
with the political analysis of the uselessness or the futility
of agreements. I think that is an indication that Acas is doing
an extremely good job. After all, the whole purpose of Acas is
to work with, if you like, the two sides of industry and to bring
them together when there are problems. If both sides of industry
are saying that Acas is doing a very good job I would defy anyone
else, who has the same depth of knowledge of what Acas does, to
gainsay that. I think it is something very positive and I am very
glad to see it.
Chairman: I am never frightened of consensus!
Q3 Mr Hoyle: As the Chairman has
already stated, the popularity of Acas and everything says what
an excellent service; but are you worried that the Chancellor
is looking to claim monies back in a different way? The Comprehensive
Spending Review is being looked at and one of the principles will
be about how the DTI spends money but also the money it puts into
Acas, does it worry you?
Ms Veale: It certainly does worry
us. I think the trouble with Comprehensive Spending Reviews is
that they are comprehensive and go across the whole of Government;
but because the Government is compartmentalised it means that
each government department then has a limited sphere within which
it is operating. It means that the DTI is looking at Acas and
the Equal Opportunities Commission and its own work but not in
comparison to other activities taking place in other departments;
which means if the DTI has to cut by a particular proportion that
can have a particular effect on the organisation it sponsors.
If you looked at Acas compared to bodies sponsored by other departments
I think you would find it would do proportionately less well,
which is very unfair on the organisation. In a word, yes, we are
very concerned about the level of cuts that Acas has been required
to make in its services.
Q4 Mr Hoyle: Do you think the actual
good name of Acas should overcome that and should be enough to
carry it through the DTI and the Spending Review?
Ms Veale: It is a tall order.
I very much hope so, and it has been very difficult for Acas to
decide where to make the cuts. Obviously the worry is that the
cuts would fall on frontline services because of the magnitude
of them. I think it is very difficult to make all the cuts in
the back room, as it were, even if you were able to sustain an
argument that that was not going to do any damage. I think where
we feel things are at the sharp end, as it were, we are okay at
the moment but there is some worry about whether the impact will
be on frontline conciliation services and collective dispute resolution,
which of course is hugely important to the TUC.
Mr Nunn: I back up what Sarah
has said absolutely. As you say, we seem to have a consensus here
that Acas do their job well. As I pointed out in our submission,
much of the work that Acas does goes unsung because it goes on
behind the scenes; it goes on behind closed doors in difficult
negotiations. To the point that it has become such a part and
parcel of British industrial relations, when proposals are made
to make 25% cuts in Acas (which are going through at the moment,
which will probably mean 25% cuts in Acas staff) we do not know
yet what that impact will be because this is a process that is
ongoing; but the danger always in these cases is when voluntary
severance schemes are put into place the people with the most
experience tend to be lost from the organisation and that is of
particular concern to us as a union.
Q5 Chairman: This resource question
obviously lies at the heart of our inquiry today. Should Acas
not be concentrating on its core work, its original work, rather
than going into other areas, for example the equality and diversity
work?
Ms Veale: It is a very good question,
but I think what Acas is doing on equality and diversity actually
shows that it has a particular role that differentiates itself
from, say, the Equality Commission and from other support services
that exist in that area. The law is very complex on discrimination
but it is not necessarily assistance with legal problems that
employers are asking for and the unions are asking for. What they
want is some help with dealing with a new diverse workforce and
problems and tensions between different groups of workers and
so on which cannot be covered adequately.
Q6 Chairman: You are saying it is
part of the core work, in a sense. We will ask you more questions
about equality and diversity.
Ms Veale: Yes, I think it is part
of the core work and something we would not want to see Acas having
to stop doing.
Q7 Chairman: One of the things which
struck me in the evidence is the emphasis that the business witnesses
have given us in their evidence as to work with small-and medium-sized
companies. I suppose Acas is seen as a relic of the great corporate
era of the 1970s. In fact, it seems its real value is often with
the SMEs. Is that your understanding as well?
Ms Veale: I think it has a different
role in relation to larger companies and in relation to SMEs.
There has been a huge growth in the number of SMEs. Larger companies
tend to have their own system up and running with personnel departments;
but what larger companies get involved in, which smaller ones
do not of course, is collective disputes. That kind of systemic
problem exists where Acas comes in and can help out where deadlock
has been reached and it is impossible to find a solution without
getting a third party in. I think that is a very different kind
of work than the work that it does with smaller and medium sized
enterprises, which are usually bereft of any type of personnel
management system and struggle. It shows how Acas has been flexible
and has accommodated the very different labour market that we
now have and has changed itself to suit the circumstances in which
it operates.
Q8 Mr Weir: In answer to an earlier
question you talked about Acas bringing both sides of industry
together. In your evidence you talk about the reduction in collective
bargaining and more individual employment rights. Why do you think
you need Acas to resolve individual employment rights rather than
collective rights which is its traditional role?
Ms Veale: It can do both; they
are not mutually exclusive. There is less collective bargaining
activity than there was—far, far less. If you look at employment
relations over the last 20 years, we have generally moved away
from a system where most pay determination was done through national
collective agreements and regional collective agreements to a
system where people actually tend to negotiate their own working
conditions. The downside of that is there might be a reduction
of trade union activity. It means because there is now a much
better floor of basic employment rights that when things go wrong
people want those rights to be recognised and their tendency is
to go straight off to litigate—which nobody wants and is
in nobody's interests—and that is why Acas has built up
a very impressive portfolio in terms of individual conciliation,
and helping employers as well to set up systems that manage disputes
away from the courts; I think that is one of the chief values.
Q9 Mr Weir: Given there has been
a movement away from collective rights towards individual rights,
why do you think we should have a public body funded by the taxpayer
to deal with these disputes?
Ms Veale: If all employers were
perfect then we would not need anybody really—trade unions,
Acas the lot—but unfortunately mistakes do get made. Yes,
ultimately in capitalism it is down to the two parties to resolve
those, that is not really going to help anyone. Quite often the
problem is actually a symptom of a much deeper issue in the workplace
which needs to be put right otherwise the problem keeps on popping
up with other individuals. I think it is not simply a question
of cutting off that dispute and everything is all right. It is
a question of having an organisation that can say to the employer,
"That went wrong. We can try and sort that out. It would
have been better if you'd had a system in place that would not
have allowed this to occur in the first place".
Q10 Mr Weir: My understanding of
how Acas works in these individual disputes is that when an employee
takes the case to an employment tribunal it is then referred to
Acas for voluntary mitigation. Do you think there is a case for
perhaps giving Acas a role prior to getting to the stage of an
employment tribunal? When employment tribunals were originally
set up the idea was that they would be low cost and less bureaucratic
than the courts; that does not seem to have worked out and many
people have the same problems as they would with the courts. I
wonder if Acas has a role as a mediator before it gets to a lengthy
employment tribunal. Do you see that as a way it could develop
in the future?
Ms Veale: It is a slightly difficult
question for the TUC because my answer ideally would be that there
should be trade unions in there mediating, sorting out and regulating
the relationship between the employer and the employees. We sadly
accept the fact that a lot of workplaces, especially the smaller
ones, do not have trade unions. The problems do not go away; they
need to be sorted out; and a lot of the time you really do benefit
from a third party intervening. Yes, to answer your question,
there is more of a proactive role for Acas on request to go in
and help employers even if they have not got any disputes bubbling
around at that particular point in time. Within the limited resources
we talked about, that would have to be balanced against the other
work that gets done. Sadly, in the absence of universal collective
bargaining coverage, there probably is an argument for having
that.
Mr Nunn: We ask in our submission
that the Acas duty to promote collective bargaining be returned;
and the reason why we do that is because—
Q11 Chairman: We will ask about collective
bargaining later on.
Mr Nunn: In relation to your question,
yes, there has been an explosion of individualised cases, partly
as a consequence of the reduction in collective bargaining. Whether
there is role that Acas can play in terms of intervening prior
to cases getting to tribunal, yes, of course there is. In some
senses what you are saying is that Acas's role increases rather
than decreases as a result of that.
Q12 Mr Weir: Indeed, but the point
I was making was that before Acas becomes involved the employee
and employer have got to the stage of a breakdown and gone to
an employment tribunal. Now that starts a process where lawyers
become involved and both sides often become very legalistic and
that was not the intention of tribunals to happen. That is why
we talk about, for example, reform of divorce law, alternative
dispute resolution. I just wonder if there is a case for some
sort of binding resolution by Acas at an earlier stage before
it gets to the adversarial stage of the tribunal?
Ms Veale: You do get into some
legal difficulties then because people do have rights. Acas can
already conciliate and reach agreements that are legally binding
on parties. As you say, that is normally only triggered when there
is an ET1 put in. In a sense, I do not think you can get round
that because the problem does not lie with how Acas operates;
it lies with the tribunal system which requires people to put
in a form very, very quickly or they lose the right to do so.
In a sense I suppose it is a trigger. It is probably the best
thing you are going to get unless Acas is going to be given the
resources to spend a lot of its time out there troubleshooting
and providing a consultancy service.
Q13 Judy Mallaber: What is the TUC's
view of the fixed periods for conciliation which were introduced
in 2004? Some witnesses, such as the CBI, reckon that is too short
for meaningful discussion and want that to be reviewed.
Ms Veale: I have to say, we would
be 100% with the CBI on that. We said when the consultation took
place, before the fixed periods came in, that we had reservations
about them. Those reservations have been borne out by our people
as well. They are saying it is much too short and does not give
you adequate time to develop a consensus and an agreement; and
it just shuts down before you have got to where you need to get.
Q14 Judy Mallaber: Do you think it
is resulting in a greater number of cases ending up going to a
tribunal hearing?
Ms Veale: It is too early to tell.
It is quite difficult to draw the relationship between the two.
I would certainly agree there needs to be a review done to see
if that is the effect. We suspect that it probably is. The trouble
is you have also got playing in the new dispute resolution procedures
and the other requirements therein, which again have distorted
the applications to tribunals because lots of applications are
going in and bouncing back because they have not done the procedures
properly. It is a bit hard to tell where the problems are coming
from—whether it is the fixed term conciliation or whether
it is other aspects of these dispute resolution procedures. We
think the whole thing needs to be reviewed, because our real fear
is that cases are not going to tribunals when they should be but,
on the other hand, also are not being conciliated when they could
have been. We seem to have a bit of a dog's breakfast at the moment.
Q15 Judy Mallaber: I can see you
arguing that there is not enough time for the conciliation process
and sorting everything out, but could it not also be argued that
if you have a longer period for conciliation that both sides will
still practise brinkmanship and it will be the twentieth week
rather than the seventh or fourteenth?
Ms Veale: Yes. There is a problem
that the psychology of disputes is that people will leave things
to the last possible moment, and I think that tendency is unavoidable
if you had a one week or a six year period. Dare I insult any
lawyers present, but where there are lawyers around quite often
the parties play the whole thing out as long as they possibly
can and then do the settlement at the tribunal door. I understand
the intention of the Government to avoid that, but I am not sure
that this has done that at all. I am not sure you could do it
through these sorts of means.
Q16 Chairman: You used the phrase
of cases `bouncing back': could you expand on that?
Ms Veale: People think they have
a good case which they put into the tribunal, whatever it is on
(discrimination or whatever) and because they now have to go through
statutory procedure in the workplace, if there is no evidence
that they have gone through that properly or there is some defect
in the way in which they wrote the letter to the employer complaining
about whatever had gone wrong, the tribunal has to throw it back
and say, "You haven't completed form [whatever it is] under
Schedule 1. You'll have to do that before you proceed with this
claim". We are picking up anecdotal evidence that some of
our members, even people with trade union offices backing them,
and certainly in the unorganised part of the workforce, are simply
losing the will to live and saying, "I really, honestly can't
go through all this any more. It's only a £400 claim for
an unlawful deduction [or something]". There is a real worry
that access to justice is being denied and you are not sorting
out workplace problems but simply displacing them. I am sorry,
it is a slightly tangential issue, but it does bear on what Acas
does.
Q17 Mr Binley: I hope you do not
rule me out of order, but the CAB plays a part in reconciliation
before Acas comes in very often, and it is almost a part of Acas
in that respect. Can I ask if you are generally happy from a TUC
point of view with the role that CAB plays? Do you feel that they
get enough training in this respect and enough support? Do you
think that the sort of cutbacks we are seeing at the moment will
impact upon that preliminary work which if done well is so important
to good resolution but if done badly can mess the whole thing
up for months to come?
Ms Veale: I have to be careful
what I say about the CAB because they are staffed by volunteers
and they are a fantastic organisation. I think one of their weaknesses,
and this shows up in a piece of research work they did themselves,
is that they do lack people who have the kind of knowledge that
you need of employment relations and complex discrimination and
employment law. Therefore, I think they have been quite heavily
reliant on help from Acas locally within regions to assist them
in doing their very valuable job. The trouble with cuts with one
organisation that works well with others is that it is going to
have a ripple effect. I think that is going to be quite damaging
and difficult for the CAB, who themselves are not exactly generously
funded and sometimes struggle to deal with these difficult problems.
Q18 Mr Clapham: A little earlier
we were talking about the enormous change which has taken place
in the structure of British industry. We see many more small—and
medium—sized enterprises today. Some years ago Acas used
to have the duty to promote the extension of collective bargaining,
and in fact Simon Nunn referred to this a little earlier. Does
the TUC think that Acas, in the changed situation in British industry,
should actually have the duty to promote the extension of collective
bargaining?
Ms Veale: If I could start and
then perhaps Simon may want to come in on this. The short answer
is, yes, we do. You can get party political about this but I think
anyone would agree that it is obvious one of the costs of taking
steps to reduce the powers of trade unions, the effectiveness
of trade unions, the ability of trade unions to bargain freely,
is that people have to go somewhere else. In a democracy they
have to have the right to exercise a growing number of individual
rights. Our view is that collective bargaining is the most efficient
and best way of resolving a lot of problems that arise from disputes
over people's individual rights. Just one example: if you look
at equal pay, which is at the moment generating huge numbers of
individual claims and causing a lot of work for Acas and the tribunals,
if you have a trade union in there, particularly a recognised
trade union, negotiating on equal pay is part of what they do.
You can solve a problem that affects 3,500 employees through one
set of negotiations. There are huge economies of scale if you
have a successful collective bargaining arrangement. I would add
the Vic Feather comment that collective bargaining is like marital
relations, it is best done consensually. Nobody is arguing for
a return to forcing trade unions on anybody. Where the employer
and the union could be persuaded to have workable recognition
agreements, there clearly are huge economies of scale. For that
reason, we feel that Acas ought to have as part of its duty a
remit to promote collective bargaining, obviously where that is
appropriate and where it is going to work effectively.
Mr Nunn: We had a reference earlier
to whether Acas was a relic from the 1970s; the 1970s are always
discussed when it comes to discussing industrial relation matters
now. Acas originally in the 1970s was set up as part of the mechanism
to improve industrial relations in Britain in response to a breakdown
in industrial relations. Our former General Secretary Jack Jones
was very instrumental in promoting the idea of a conciliation
service. In terms of us asking for a duty to promote collective
bargaining, I would back up what Sarah says. In the modern environment
collective bargaining does not necessarily mean a return to the
1970s. If you look at some countries in Europe, particularly Scandinavian
countries which have very high levels of collective bargaining,
you will find very high levels of productivity. We would look
at coordinated bargaining across the sectors of the economy as
mechanisms to coordinate issues of training, skills and pensions
as well, which is obviously a major issue for many workers.
Q19 Chairman: There are two separate
issues here: one is, is collective bargaining a good thing; and,
if it is a good thing, who should promote it? The question I would
like you to focus on, on the merits of collective bargaining,
is: assuming that collective bargaining is a good thing, is it
right that Acas should promote that; or should it be other people
promoting the merits of collective bargaining? Is there a risk
of Acas's impartiality being prejudiced if it is the body
charged with promoting collective bargaining?
Ms Veale: That politicises employment
relations really, does it not? I would argue that you should try
to depoliticise it. In that case it is quite sensible for Acas
to have a role in promoting it where appropriate. In a large company
in particular, if there are trade unions with substantial numbers
of members, it would seem absurd if Acas did not try and help
the employer and the union to reach some sort of acceptable recognition
agreement; otherwise you are going to end up advising the employer
how to deal with a group of fairly dissatisfied employees who
want to have a collective voice but are being denied it. Where
appropriate Acas should be able to promote collective bargaining;
not to force it as a philosophy down everyone's throat—no-one
is suggesting that.
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