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Lord Archer of Sandwell: My Lords, has my noble friend considered Clause 12 which, unless I have misunderstood the position, takes some of the points that he is making?

Lord McCarthy: Yes, my Lords, it does take some of those points and if we had more time--we may consider this in Committee--I could list the ways in which I regard the exemption procedure as superior to Clause 12. It is much more professional and allows for the problems to be tackled in a much more specified and detailed way. It can result in the establishment of standing tribunals. It does not deal with only one case if one employee wants to use it; it is an overall agreement. That is why I regard it as an advance on anything in the present Bill.

I should like the Government to tell me--today if they can but, if not, subsequently--their attitude towards attempting to encourage the exemption procedure. We are talking about caseload. The Government are bothered about the caseload and it has been estimated that between 30 and 35 per cent. of the caseload comes from the public sector. If, as a result of government encouragement, employers in the public sector were to offer exemption procedures to the unions in the public sector, we might be able at a stroke to remove 35 per cent. of the caseload. We cannot do that with Clause 12.

I come to my second question which relates to inducements for workers to contract out under the present Bill. What are the inducements for workers? We all know about the inducements for employers. They do not have to appear at the tribunal. If the case goes against the employer, that will not become public and will not appear in the local newspapers. So, what are the inducements for workers to enter the new system proposed in the Bill? We can imagine what they might think, so I am asking the Government and the noble and learned Lord, Lord Archer, whether it might be possible in Committee to introduce some specific inducements into the legislation. Could we say that if you enter an arbitration procedure--could it not be part of the eventual ACAS procedure?--the matter is resolved within a specified time? Why could we not have time limits? Could we say that re-employment and reinstatement might be built into the procedure? Could we say that the provisions will apply to those who have been employed for less than two years? We could say

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lots of things to induce workers to move into the procedure, because if we do not, they will not do so. Unless we can convince workers that the new system will be better and quicker, the only workers who will move into the new procedure will be those who are put under pressure to do so by their employers.

That brings me to my next question. How are we going to ensure that pressure is not put on people to move into the new procedure? The noble and learned Lord, Lord Archer, has already discussed this so I shall not do so at length. If I understood him correctly, he said that he would like to do something on that point but is worried about whether we can say that someone must have advice. What qualified advice could someone have? Could they have a lawyer or could they demand the right to go to a free, law advice centre? If they can, I should like the Government to say today that they recognise that there is a problem and that workers could be suborned or pressurised to enter this procedure which is to the very obvious advantage of employers. I hope that in Committee the Government will be able to put something on the face of the Bill to help to defend workers against the pressure that they might be placed under. That is my third point.

I come now to my fourth question. If we are moving into arbitration--I should declare a double interest here--who will the arbitrators be? Will they be those from the ACAS list? Here I must declare a non-interest because I do not want these arbitrators to be from the ACAS list because we are not lawyers. I believe that the arbitrators must be experienced arbitrators and that they must have some legal competence. They must know what the law is. Indeed, I would not mind if they were legally qualified arbitrators as long as they were also experienced. I can think of many lawyers with industrial experience who operate within the system. I should like the arbitrators to have certain qualifications. There is nothing unusual about that with regard to the unfair dismissal procedure; for example, outside arbitration--that is, in industrial tribunals--people have to have special qualifications to be able to serve on tribunals dealing with race and sex discrimination cases. We can pick and choose the arbitrators that we have. Do the Government agree that that is right?

My fifth question is more complicated. I believe that the noble Lord, Lord Wedderburn, was also concerned on this point. The great advantage of arbitration--its abiding glory--is that it is essentially hugger-mugger. No one knows what you did or why you did it for the most part and you do not even have to give your reasons. It is quiet, confidential and private. If we are successful in moving from legal regulation to arbitration, do we want virtually all unfair dismissal cases to be dealt with hugger-mugger? That would mean that there would never be any principles and that we would never find out why the arbitrators did what they did. That is what happens in arbitration. Even more dangerously, do we want that to happen with race, sex or disability cases? What about those cases involving future European Union directives on workers' rights? They would normally go to industrial tribunals, but are they all to go now to arbitration? If so, that would mean that we would never know about them.

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In the past we have had a whole series of cases where the decisions of tribunals, of the EAT or occasionally even the ECJ, have been given maximum publicity--and that has been a very good thing. I shall not list them, but there has been a whole range of cases in which lawyers have said things which all other lawyers said that they would not say. There have been enormous and significant advances in workers' rights relating to, for example, sex discrimination in the Marshall cases. I would not want such decisions in future to be hugger-mugger. I want them to be proclaimed because we are creating new standards. How far do we want to go in shifting, in the interests of expediency, swiftness, reinstatement and re-employment, from a public system where everybody knows what has happened to a new basis of jurisdiction which is hugger-mugger? I should like the Government to try to answer me on that point.

Lord Wedderburn of Charlton: My Lords, we might have judicial review.

Lord McCarthy: My Lords, the noble Lord may say that, but, with respect, it is not as effective and it takes a lot longer.

Finally, I should like to ask about the cheapness of the new scheme. I have looked at the previous government's Green Paper and I can see only one reliable figure, but, as I shall show, it is not reliable at all. Page 16 of the Green Paper states that the cost per case of industrial tribunals is £966 and that the cost per case of an ACAS cleared dispute is £263, which means that the latter is about four times as cheap. It will not do, because ACAS does not provide arbitration in most of these cases. What ACAS says is four times as cheap as conciliation. Of course conciliation is cheaper, but we are talking here about a new system. I hope that under the new system which will provide the worker with the right to obtain some advice there will be a legal chairman. If you have a legal chairman you must pay more money. I hope to provide incentives and inducements to workers to enter this system. We have absolutely no experience of what it will cost to operate an arbitration system for unfair dismissal or anything else. Those figures do not stand up. Perhaps the Government can try to provide more up-to-date figures in order that we can compare the relative cheapness of the two systems.

I support the Bill, but I want to see it improved. We do not want to see figures that demonstrate that we do not want the Bill at all because arbitration turns out to be more expensive. I do not think that it need be. We need to be more realistic. With those qualifications, I commend the Bill to the House.

12.21 p.m.

Lord Phillimore: My Lords, as a practising barrister I welcome this opportunity to make a few comments on the Bill. I therefore also declare an interest. I welcome the proposed change of name from industrial tribunals to employment tribunals, since that is clearly more consonant with the work done by them. Clause 2 appears to propose a substantive change, providing for the determination of disputes without an oral hearing.

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I have reservations as to whether in practice that will streamline cases. Furthermore, I do not consider it an appropriate form of hearing in cases where facts are often in dispute and the evaluation of witnesses is necessary and important, as in unfair dismissal and discrimination cases. It may be more appropriate for determining jurisdiction and preliminary points. However, even those are often better resolved with some oral evidence.

Where the person against whom proceedings are brought does nothing to contest the proceedings, the proposal seems to lead to a decision on the merits. The requisite material for such a decision is unlikely to be contained in the originating application. That would be the only material before the tribunal. However, I welcome a procedure that is akin to judgment in default of a notice of appearance, provided that the time limit for filing a notice of appearance is extended from 14 to 28 days. I suggest that that is particularly necessary in complex discrimination cases where complaints may go back over a number of years and involve several different managers.

In relation to preliminary hearings I respectfully suggest that the Bill may provide an opportunity to clarify paragraph 6 of the first schedule to the Industrial Tribunals (Constitution and Rules of Procedure) Regulations 1993 and what is meant by,

    "entitlement of any party to bring or contest the proceedings to which the originating application relates".

A further point in relation to preliminary hearings arises from the proposal in Clause 5 to use a legal officer to deal with such matters. I share the concern of the noble Lord, Lord Wedderburn, about the proposal. It is a vital part of efficient case management that a preliminary hearing be dealt with by a legally qualified chairman with or without lay members. As for the proposal in Clause 3 to extend the categories in which a chairman sits alone, I suggest that cases under Section 11 of the Employment Rights Act 1996--which concerns references as to what should be included in the written statement of terms of employment to be provided by the employer at the request of the employee--should be excluded since often they involve complex questions of construction of agreements and the determination of factual issues where the assistance of lay members would be particularly helpful.

As for the arbitration proposals, I suggest the following: that the parties and arbitrators agree the terms of reference; that arbitrators decline jurisdiction in cases of substantial factual and/or legal dispute; that arbitrators should have power to remit a case to an industrial or new employment tribunal at any time; that there be no right of appeal but a right to complain about failure to comply with the outcome of the arbitration to an industrial/new employment tribunal; and that the administrating of oaths or affirmations should be permitted at the discretion of the arbitrator in each case.

I am concerned about the proposal in Clause 9 that "independent legal advice from a qualified lawyer" should be replaced by "independent advice" since this appears to remove the need for such person to have any qualifications at all. I suggest that that would be highly undesirable. I therefore share the concerns of other

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noble Lords. I am worried too by Clause 13 and the proposed reduction in compensation for failure to use internal procedures. The reasons for that concern were eloquently expressed by the noble Lord, Lord Gladwin. Subject to those comments, I commend the Bill.

12.26 p.m.

Lord Thomas of Gresford: My Lords, I join in congratulating the noble and learned Lord, Lord Archer, on bringing forward this very important Bill. From these Benches I give it a cautious welcome. I have never ventured into the field of employment law without making a deep study of the collected works of the noble Lord, Lord Wedderburn. I do not profess to have his expertise but, just as the noble Lords, Lord McCarthy and Lord Phillimore, have declared interests, I have appeared for applicants and respondent local authorities and statutory bodies before industrial tribunals and employment appeal tribunals. Wearing another hat as chairman of a radio broadcasting company, I have summarily dismissed executive directors and found myself defending those decisions as a witness in industrial tribunal proceedings.

When I see the word "streamline" in the explanatory memorandum to this Bill my suspicions are aroused. The danger that always attends the reform of forensic procedures is that it may be inspired by a desire to make things easier for the tribunal to get through its workload. That was put succinctly by the noble Lord, Lord Gladwin, who said that it might be designed to improve the throughput figures. He also welcomed the Bill on the basis that it would reduce his workload, so he looked at it from both points of view. Reform must always be approached from the point of view of the user of the system. As the noble Lord, Lord Wedderburn, rightly emphasised, in these types of proceedings the applicant is always in a weaker position.

The question to be addressed is whether the proposals make matters speedier and easier for the applicant to obtain justice. With that in mind, I consider that these proposals can be improved, as many noble Lords have said. The noble and learned Lord, Lord Archer, himself commented that he was not wedded to every jot and tittle. That conjured up a rather interesting picture of this Bill.

Clause 2 proposes to introduce amendments to permit regulations to be passed so that a tribunal can determine cases without a hearing, or a full hearing. The first example of that is that the tribunal can act without a hearing on written evidence alone where both parties have given their consent. As a practitioner, it is hard for me to envisage where such a procedure would be appropriate if there was any dispute either as to fact or to law, possibly with calculations of compensation.

But one wonders what else the noble and learned Lord, Lord Archer, has in mind in putting forward that example. Contrary to the view that he expressed, the Employment Lawyers Association is concerned that consent to such a procedure should be informed consent so that an applicant does not waive his right to a full public hearing without being fully aware of the consequences of so doing. I would argue that consent

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must be conditional on the party concerned obtaining independent legal advice. I do not understand why in new subsection (3A) in Section 7 of the Employment Tribunals Act there should be a provision that the consent, once given, could not at any subsequent stage be withdrawn and a full hearing sought. I can envisage circumstances which might well arise where consent to a decision without a hearing having been given at one stage, that consent should be withdrawn.

There is also a provision in new subsection (3B)(b)for no hearing where it appears that the applicant is not entitled to the relief that he is claiming. Whether or not the applicant is entitled to the relief that he is claiming may well be the subject of considerable argument in a complex case. It may be the very issue. It is not enough for the tribunal to decide that the applicant is not entitled to the relief that he is claiming. The noble and learned Lord should narrow that provision to the first part of the subsection as drafted, as indeed he indicated when he introduced this provision. The drafting may need to be looked at.

The third matter to which I would refer where there is no hearing is where a superior court has decided to the contrary. If the tribunal were to dismiss a case because there was a decision, for example, of the Employment Appeal Tribunal which seemed to be against the applicant, that would deny the new applicant the opportunity ever to challenge the decision of the superior court. Normally, the applicant would go through the first stage, accept that he was bound by the decision of the superior court, ask for findings of fact and then take the matter forward in an attempt to challenge the issue at the highest possible court. Summary dismissal of his claim without a hearing in which such factual findings are not made might well be a cause of injustice.

In Clause 5 there is a reference to the appointment of legal officers--mysterious figures, as the noble Lord, Lord Wedderburn, described them. They have powers under Clause 5 to carry out anything and everything that a chairman is allowed to do. That is where I suspect that the motivation is to relieve the pressure on the chairmen of industrial tribunals and to take things away from them rather than looking at it from the applicant's point of view. It introduces the concept of the interlocutory judge--the master or district judge, with whom we are so familiar in ordinary civil proceedings. Once we do that we necessarily have to introduce a body of rules and appeals. That involves delay and expense for the applicant and for the respondents--that delay was so rightly deplored by the noble Lord, Lord Gladwin. With my experience of civil proceedings, it would give rise to the possibility of tactics on one side or another; delays on one side or another; putting pressure upon applicants; and unless the provision is much more clearly explained I would oppose the concept of the legal officer.

The nature of the appointment does not suggest a level of remuneration which would attract the most experienced and mature judicial minds to that task. A better approach to the problem of dealing with such matters might be case management, as set out in the Woolf Report--case management controlled by the chairman of the industrial tribunal. That is what he is

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paid for. The Government should not try to save money by not appointing enough industrial tribunal chairmen or by the appointment of a much more lowly "mysterious" judicial figure.

I come to Clause 7. The concept of an arbitration scheme is, on the face of it, attractive, but we do not know what is in the mind of the noble and learned Lord in putting that forward. The arbitrator is a decision maker, acting, as the noble Lord, Lord Wedderburn, pointed out, within a framework of legality. He has to apply the law as he understands it. He has to act within the legal procedures. His decision is subject to judicial review.

If competing cases are to be presented for a decision by a decision maker, it is far better that it be done in public; that there be orderly presentation of well prepared cases, conducted by qualified and experienced advocates, whether they be lawyers or experienced trade union officials. It should be done professionally. A row behind closed doors is not an effective substitute for a public hearing. As the noble Lord, Lord McCarthy, pointed out, secrecy is usually in the interest of the employer, who may well be happy to have the proceedings behind closed doors.

Of course the negotiated settlement of an unfair dismissal case under the auspices of ACAS and with the assistance of a skilled conciliation officer is an entirely different matter. There is existing legislation to make provision for just that. It is helpful for parties to come together with a skilled conciliator, and for them to have face-to-face discussions. That is different from going to an arbitrator who is being called upon to make a decision that is binding upon the parties.

I should like to be assured that the motivation behind the whole proposal for arbitration is not just to reduce the workload of the industrial tribunal or to avoid the appointment of additional tribunal members. It would be undesirable were an applicant to be persuaded to take his case into a private room, with an arbitrator appointed for the day, merely on the promise that his case would be heard more cheaply and more quickly. Justice: the arrival at a fair and correct decision in the particular case is much more important than speed and low cost. One of the most difficult positions for a legal practitioner to be in is to have a client who feels that the judge has interrupted him, has cut him short, that his evidence has been rushed, that his submissions have not been heard, and he has lost without having had his full and fair day in court. Speed and low cost are not necessarily the concomitants of justice.

The proposal in Clause 8 is to extend arbitration proceedings beyond unfair dismissal cases. Many noble Lords have expressed the TUC's view that it would be undesirable for such arbitration to take place in sex, race and disability discrimination cases because they raise complex questions of law. If there is to be arbitration along the lines in the Bill, I take issue with the TUC which has suggested that the use of lawyers in arbitration proceedings should be discouraged as far as possible. Some noble Lords have echoed those sentiments today.

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It is fashionable to denigrate lawyers and their fees. Unlike the noble Lord, Lord Wedderburn, I do not speak carefully on this issue. Lawyers are not part of the entertainment industry. Their words float away in the air. They do not leave behind them any great artistic legacy, any body of literature, or any monument or building. Sometimes I wish that I had built the bridge on the M.6 along which I shall pass tonight as I drive to Scotland. If its design were the sole achievement of my life, I would be a happy man. Lawyers leave little behind. However, there is no comparable body of equal expertise and integrity charged with the responsibility of assisting people in trouble and of asserting their rights. If lawyers are no more than mechanics who keep the wheels of the various court and tribunal procedures turning, their skills have a vital effect on people's lives.

I was gratified to hear the noble Lord, Lord McCarthy, refer to the great advances--surprising as they appear to be to him--that lawyers have made in the employment field. For that reason, I entirely oppose the proposals set out in Clause 9 which would entitle anyone, qualified or not, who could acquire an insurance policy to set himself up as an independent adviser for the purpose of advising on compromise agreements. Considerable disquiet is already felt in the legal profession about the burgeoning ambulance chasing of so-called loss adjusters who advertise their services to injured persons to pursue and negotiate the settlement of their personal injury claims with insurance companies. In my view, these proposals would create a similar class of people who, since their whole raison d'etre would be to broker deals between applicants and respondents, would undoubtedly lack the independence of solicitors or counsel, whose practices do not depend upon a narrow area of work.

Your Lordships should not be moved by stories of fat cat lawyers--a phrase regrettably used by the noble and learned Lord the Lord Chancellor--into creating a sub-profession of alley cats; people who do not have the necessary qualifications to give proper advice. If any amendments are to be made to this provision, the advisers who give advice to applicants should be specified either as lawyers or recognised trade union or professional representatives.

My noble friend Lord Lester of Herne Hill wrote to the noble and learned Lord, Lord Archer, spelling out two particular problems which he believes should be addressed. The noble Baroness, Lady Turner of Camden, has already underlined the point that the present procedures for dealing with equal pay claims for different work of equal value are tortuous and unworkable. I know that the noble Lord, Lord Lester, has practical experience of such problems and I have no doubt that he will take the opportunity to bring forward suitable amendments, provided that they are within the Long Title of the Bill.

Secondly, the noble Lord, Lord Lester, has pointed to the clogging up of lists by the applications in which the same point of principle arises. It may be that many of the 88,000 rising to 109,000 cases are caused by a system which demands that individuals file individual applications in particular, for example, in sex discrimination in pay cases. It ought to be possible to

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bring representative proceedings or the equivalent of class actions. Where, for example, there has been a ruling in the European Court on a material issue, a representative action would assist in clarifying its effect on UK law. This is an ideal opportunity to make a necessary procedural reform which ought greatly to relieve the pressure on the tribunals by reducing the mirror, repetitive cases into one representative case.

I know that the noble and learned Lord, Lord Archer, will take on board the comments that I have made. We on these Benches will endeavour to work with him on the practicality of my suggestions and we will endeavour to co-operate to the best of our ability to ensure that the Bill reaches the statute book.

12.44 p.m.

Lord Burnham: My Lords, although the right reverend Prelate the Bishop of Liverpool is no longer in his place, on behalf of these Benches I wish to second the good wishes expressed by the noble and learned Lord, Lord Archer of Sandwell. I do so with great pleasure.

I, too, congratulate the noble and learned Lord, Lord Archer, on bringing the Bill forward. We welcome it with more than the cautious welcome it has received from certain other noble Lords. The Bill would have made my life a good deal easier in the years when much of my time was spent in industrial relations, a great deal of it sitting and waiting around in bleak rooms at ACAS, even if not normally for unfair dismissal cases.

I am sorry that much of today's debate has been spent most professionally by noble Lords experienced in the trades union movement. I should have liked to have heard Members of my own Benches--perhaps it is my fault that they are not here--expressing their views from their experience in management. Furthermore, I should have liked to have heard the noble Lord, Lord Marsh, who was in the Chamber at the beginning of the debate, speaking from his great experience of the Newspaper Publishers Association.

The noble and learned Lord, Lord Archer, can regard himself as the godfather of the Bill. It has a distinguished parentage and its gestation period comfortably exceeds that of an elephant. The Green Paper which was its progenitor was published in 1994 and in November 1995 my right honourable friend the then President of the Board of the Trade announced the Conservative Government's intention to implement the proposals. The draft Bill was published a year ago last week. It seems to have undergone a few changes during that two-and-a-half years and I have no doubt that we shall look for some refinement before it leaves this House with our blessing.

There is undoubtedly a need for it or for something similar. It cannot be right that with between 20,000 to 25,000 cases a year going to arbitration, 50 per cent. took more than 26 weeks to be heard, even though that figure has been reduced. I say to the noble Lord, Lord Thomas of Gresford, that justice and speed are not incompatible. The noble Lord, Lord McCarthy, spoke of a possible inducement for employees. Undoubtedly, speed is such an inducement. An employee who has

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been dismissed needs to obtain new employment fast and will find it difficult to do so with the problems of his previous employment and the end thereof hanging over him. The issue of re-engagement or reinstatement, whatever one calls it, must remain in the Bill, but none of us has any doubt that it is not a practical solution in other than a small proportion of cases.

The enactment of the Bill must lead to shorter waiting times. Those who are responsible for the Bill are to be congratulated on that. I hope that tribunals will be tough in setting realistic deadlines. I suspect that there is never a real delay in getting to ACAS and if the case can be settled there, there is less cause for complaint. It is the log jam of cases waiting for the arbitration that causes the delay.

A change that has come about since the days of the White Paper--a change which I believe is to be regretted--is the dropping of the proposal that employees shall be barred from tribunals unless they can show that they have already tried to settle their dispute with their employers. Such a clause would have prevented too precipitate a charge in the arbitration maelstrom and reduced the necessary consideration of many hopeless cases.

When the Green Paper was published, the local government management board expressed concern that the changes which allowed the chairman of the tribunal to sit alone in the majority of cases would undermine the belief that tribunals were impartial and effective. Almost all noble Lords who have spoken have touched on that point.

The noble Baroness, Lady Turner, who is no longer in her place, made some very good points about the support which the "sidesman" would give to a chairman. But I do not believe that there is any justification for the argument that a chairman sitting alone would undermine the belief that the tribunals were impartial and effective. I do not believe that I am being too cynical in saying that that change to one man sitting alone--and I talk about men in the sense of members of the human race--will serve only to save time. In my experience, the two lay members--one an employer's nominee and one a trade union nominee--tend to cancel each other out and in any event, the settlement reached is based largely on the opinion of the professional chairman. There must be concern if the chairman is relatively inexperienced, but that would not seem to be a serious danger.

Some thought should be given to the question of whether widening the qualifications necessary for a chairman is contradictory to the requirement that he carry insurance. Somebody who is not a professional would find it difficult to obtain the necessary insurance. But I do not believe that would be a problem, although that matter must be considered in Committee.

The change to allow ACAS to prepare a scheme for arbitration in unfair dismissal cases is particularly to be applauded. In industrial disputes, my experience is that the ACAS conciliation officer seems generally to act in the capacity of a eunuch: he can offer professional advice but is unable to get the job done himself. Under the Bill he will be able either to recommend a settlement

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which the parties may accept without going to arbitration or failing that, will prepare and polish the case which is to be presented to the arbitrator.

It is foolish to think that cases which either employees or managements bring to the tribunal are put together with the same care and professionalism as speeches in your Lordships' House. Whether the case is to be presented in writing (and adjudicated upon), as it will now be able to be, or be taken to a tribunal by the appellant in person, the work of the ACAS conciliator must greatly shorten the time it all takes. Having prepared a scheme under Clause 7, it should be possible for ACAS to proceed smoothly. At a later stage it will be possible for the scheme to be extended to other classes of disputes. That would be extremely helpful for the process of industrial negotiations, even though the noble and learned Lord, Lord Archer, questioned that. But it would seem to be a satisfactory fallback.

Clause 13 is particularly welcome. This will penalise either party for not taking advantage of the internal or external procedures open to it. By failing to use any procedure set up for appeals against dismissal, an employee's compensatory award may be reduced; and if the employer prevents in any way the proper use of such procedure, the payment may be increased. The Bill contains a worrying amount of common sense.

I should like to comment on Clause 1 in that context whereby the name is changed from industrial tribunals to employment tribunals. It is ironic that that comes at a time when the charge of the Bill moves from the Department for Education and Employment to the Department of Trade and Industry. However, I accept that.

I note that when the Green Paper was published in 1994, there was a suggestion in the Guardian that employees and unions might be disadvantaged by the Bill (which was then unpublished). In a letter to the paper, Mr. John Monks, the General Secretary of the TUC, expressed himself content and was in particular unworried about the lack of a right of appeal from the judgment of a tribunal. He is probably correct in this because as he says that even if there is no right of appeal, either party could seek judicial review if it was felt the arbitrator had taken a decision which was legally wrong.

I am interested that Mr. Monks at that time confirmed that it is rare in unfair dismissal cases for new precedents to be set. As he says, the vast majority of claims are uncomplicated and routine. Arbitrators have heard it all before. I am sure all those who have been involved would accept that. So much is this so that it might in the future be possible to settle all claims by computer! However, I hope not.

I have expressed some form of a eulogy for the Bill which, as I say, we very much welcome. There are changes which are desirable and which will be discussed in Committee. One point that I should like to raise, which has not been raised by other noble Lords although the noble Lord, Lord Gladwin, took the matter from another angle--that is, using the procedure for small firms with a very small number of employees. Many

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firms have fewer than 10 employees, and many companies with employment problems are newly set up and, at the time of conflict, still relatively disorganised. It may well not be appropriate for those companies to enter the full panoply of the provisions of the Bill. Although I consider this to be an excellent procedure, I question whether it is appropriate for all organisations or whether there should be an easier, very simple procedure for small companies. In almost every case, they should be able to find a method of settling the dispute by a simple heart-to-heart with an adviser who is sympathetic to both parties.

I therefore ask the Minister to look at the Bill to see whether in Committee there is any way of making the procedure even simpler for the simple employer and the simple, if aggrieved, employee. We shall do the same. Employees in such businesses are unlikely to have the protection offered by the trade unions where larger numbers are employed and such employers may well not have a trade organisation at their back. It is still necessary for justice to be done and to be seen to be done but in these cases it is as important that the procedure should be simple and easy.

That seems to be the only major problem, but is an important one and should be addressed if the Bill is to achieve its aim of quick, easy and universal justice. Having said that, I would give it the full blessing from these Benches and wish it well on its way.

12.48 p.m.

Lord Haskel: My Lords, first I congratulate my noble and learned friend Lord Archer of Sandwell on bringing forward this Bill. It relates to a subject in which he has considerable expertise and knowledge, as he has demonstrated to us by his remarks this morning. Other noble Lords have spoken and they too have given us the benefit of their experience and knowledge. I thank those noble Lords who had the courtesy of informing me of their concerns beforehand. In particular, I should like to thank the noble Lord, Lord Burnham, for his welcome for the Bill.

The previous government started work on the Bill, as we have been told. It was the subject of two consultation procedures and, as my noble and learned friend Lord Archer told us, it has received support from a wide variety of sources, including employers organisations and the trade unions. We welcome this and look forward to further examples of social partners working together with government and producing practical and workable solutions.

We support the Bill. The Government welcome the initiative of my noble and learned friend in bringing the Bill forward. I am grateful for the opportunity to outline our reaction to the Bill, to welcome the changes made to it since it was published last year, and to say how the measures contained in it are to be taken forward. I shall try to answer some of the questions put to the Government. I know that my noble and learned friend will respond to the points made to him. However, as regards those points which fall in between, I am sure that we will deal with them by letter.

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This is a Bill about the resolution of disputes and it aims to improve relations in the workplace. Where there are disputes, it is in the interests of all concerned that they should be resolved speedily. I should tell the noble Lord, Lord Thomas, that justice delayed is justice denied. The Bill will achieve the speed-up of justice in a number of ways. It will streamline certain tribunal procedures; for example, by allowing chairmen to determine certain issues without the need for a full hearing. It will also promote alternative forms of dispute resolution, such as arbitration, and encourage the use of internal appeals procedures.

Some noble Lords expressed concern about the effect of those changes on the users--that is, on the employees in particular. The changes will bring benefits to those who find themselves in the unfortunate position of being involved in a dispute: this will benefit both employers, especially small firms, and employees alike--the users of the system.

Central to dispute resolution is the role of ACAS. I should like to pay tribute to ACAS and the work that it carries out both in collective disputes and the less high profile, but equally important, role of attempting to settle individual employment rights disputes through conciliation. ACAS has an admirable track record in the area. Indeed, for employers and employees alike, the intervention of ACAS is often a welcome means of trying to resolve their differences. My noble and learned friend's Bill will give ACAS new responsibilities in this regard, both in terms of providing an arbitration scheme for unfair dismissal disputes and extending the conciliation officer's duties to include redundancy payments cases; for example, where employers have not paid their former employees what they are statutorily entitled to receive.

Certainly the proposal that ACAS should provide an arbitration scheme is a new development in the area of dispute resolution. Yet this will be another positive step towards helping people solve their disputes. The Bill does not contain the detail of the scheme. Instead, it outlines the general framework under which the scheme will operate. This will allow ACAS the flexibility to design a scheme which will be voluntary, informal, non-legalistic, private and binding on the parties. We look forward to receiving ACAS's proposals in due course.

My noble friends Lady Turner and Lord Wedderburn expressed concern on the matter; indeed, the noble Lord, Lord Phillimore, made some suggestions about the ACAS scheme. I am sure that those points will be taken on board. It occurred to me during today's debate that it might be helpful if the Government were to ask ACAS whether it could produce a memorandum illustrating what such a scheme might look like. I believe that that might help noble Lords in Committee.

Other noble Lords have asked who the arbitrators will be. ACAS will appoint arbitrators to the scheme, but they will not be ACAS employees or officers. The noble Lord, Lord Thomas, and other speakers wanted the results of the arbitration to be public because such decisions may have an important effect on the rights of employees. I would say that arbitration is probably not

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suitable for such important cases. Those cases will go to industrial tribunals which are held in public and, therefore, the public will be aware of tribunal decisions.

The ACAS scheme will cover unfair dismissal disputes. My noble and learned friend has already pointed out that the Bill contains a power for the Secretary of State to enable ACAS to prepare arbitration schemes in other jurisdictions. Noble Lords expressed concern about that provision. I should like to assure the House that the Government have no plans at present for additional schemes to be introduced.

The introduction of an arbitration scheme for unfair dismissal disputes is, as I have said, a new development. We have an open mind about it. If it is successful, that will be because parties involved in disputes have found it to be a useful means of resolving their disputes. If it is successful, we may take views as to whether arbitration might be a suitable method of resolving disputes in other areas.

My noble friends Lord Gladwin and Lady Turner expressed their concern about extending the area of arbitration. I should point out to them that, if we are to contemplate arbitration being available for other jurisdictions, we would ensure that the relevant representative organisations, such as employers and trade unions, were consulted. And, where appropriate--for example, if it were contemplated that arbitration might be suitable for disputes involving discrimination--we would consult the EOC, CRE and other bodies. My noble and learned friend has also signalled that he wishes to make an amendment to ensure that any orders made by the Secretary of State to approve new jurisdictions will be subject to the affirmative procedure. I can confirm that the Government will support such an amendment. I hope that that will reassure those noble Lords who were worried about that aspect of the matter.

The ACAS scheme will, of course, be an alternative to an industrial tribunal hearing, but it is not a replacement for the tribunals. The Government are fully committed to the important role that the industrial tribunals play in the industrial relations field. I should like to put on record our high regard for the work of such tribunals and, in particular, for the lay members, who often hold down full-time jobs. Indeed, the tribunals benefit from their experience.

There are proposals in this Bill to extend the circumstances in which a chairman will sit alone without lay members on certain technical cases. My noble friends Lord Gladwin and Lord Wedderburn and the noble Lord, Lord Phillimore, were worried about chairmen sitting alone. I should stress that this is not a step towards doing away with lay members altogether. The Government are committed to the use of lay members. Their practical experience of relations in the workplace is very valuable in the majority of tribunal cases. The proposals in the Bill will extend "sit alone" for full hearings to a number of more straightforward technical types of case in which the input of lay members may be less valuable. Other hearings will continue to be conducted by a three-person tribunal.

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Even in the sit-alone cases, the chairman will have the discretion to call for a tribunal of three if that is believed to be desirable.

The administrative support to the tribunals is provided by civil servants. They created a next steps agency--the Employment Tribunals Service--in April 1997. Despite substantial increases in their caseload, the tribunals have made substantial improvements in recent years in efficiency. My noble and learned friend Lord Archer gave us the figures and outlined the size of the problem regarding the caseload in the pipeline. Despite improvements in efficiency, there is always further room for improvement. To achieve that, my noble and learned friend's Bill aims to give the tribunals additional tools to streamline procedures which should be welcome to both employer and employee alike. No one wants to waste time unnecessarily at an industrial tribunal hearing if it can be avoided. The Bill will ensure that proceeding are dispatched efficiently and effectively in accordance with the interests of justice.

Some noble Lords were concerned about the internal procedures. The Bill will give the tribunal the discretion to consider all of the circumstances of a case and in particular the likelihood of success of an appeal. This will allow tribunals to take account of procedures which were forced upon employees and which were not even-handed. The tribunal will also take account, as it is required to do by the 1992 Act, of the ACAS code of practice. The code states that it is good practice to give details of disciplinary action in writing and at the same time the employee should be told of any right of appeal, how to make it and to whom.

My noble friend Lord McCarthy was concerned about dismissal procedures agreements. Clause 12 is about dismissal procedures agreements. It seems to me that it does exactly what the noble Lord is asking for. It makes the legislation more flexible. This Bill was prepared by the previous government and we are happy to support it. However, the previous government appeared to want to remove rights from employees in small firms. The noble Lord, Lord Burnham, raised that point. In our business manifesto Equipping Britain for the Future we stated that small firms were the bedrock of a successful enterprise economy and that we would give small firms the backing they deserve. We also stated that we believe in fairness at work. This Bill deals with both those aspects.

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