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Lord Haskel: My Lords, the Government fully support the initiative of my noble and learned friend in tabling this amendment. It may be convenient for the House if I refer also to the amendments tabled by my noble friends, Lady Turner, Lord Wedderburn and Lord McCarthy. The Government have considered carefully the points raised by my noble friends Lord Wedderburn and Lord McCarthy, and I am grateful to them for contacting me well in advance of the debate; indeed, they have referred to the considerable correspondence that has taken place.

As my noble and learned friend Lord Archer made clear, his amendment is a straightforward and technical one to ensure that the proposed ACAS scheme for the arbitration of unfair dismissal disputes--here I can give an assurance to my noble friend Lord Gladwin--will work in a similar way both north and south of the Border, subject of course to the background of the different legal systems.

Arbitration law is different north and south of the Border. In England and Wales there is a codified approach to arbitration in the form of the Arbitration Act 1996, but in Scotland that is not so. Therefore, the Government propose to build upon the existing legislative framework to provide an arbitration alternative which will be available throughout Great Britain. The scheme will work in the same way both north and south of the Border, subject, as I said, to the different legal systems. It is important to emphasise that, effectively, the individual substantive rights under the scheme will be the same throughout Great Britain.

To make the same provision for England and Wales would be unnecessary. Anything that the amendment would enable us to do for Scotland can already be done in respect of England and Wales by using the Secretary of State's power to apply and modify the provisions of the Arbitration Act 1996. It is never desirable to duplicate legislation. The method chosen in the Bill is to use the provisions of the Arbitration Act with appropriate modifications.

As regards the residual right of appeal in Scotland, I should point out that there will be no appeal in Scotland on a point of law unless one is written into the scheme. Any challenge under the scheme as it applies to Scotland will be strictly limited to those specified in the scheme. The Government consider that the approach proposed by my noble and learned friend's amendment is the most effective way to ensure that the two schemes are as similar on those points as is achievable.

I turn now to the point made by my noble friend Lady Turner; namely, that people in England will seek to have their arbitration heard in Scotland. In response, I can only say that the scheme will provide that cases which would have been heard by a tribunal in England and Wales will be heard by arbitrators under the law of

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England and Wales. Similarly, cases which would have been heard in Scotland by a tribunal will be heard by arbitrators under the law of Scotland.

My noble friend Lady Turner and other noble Lords raised the question of appeal or challenge and referred to material irregularity. We have all agreed that there should be some form of safety valve to cover the situation where an individual has suffered an injustice because of the way that the arbitrator has conducted the arbitration. That may be because the arbitrator has not acted fairly or impartially or because he has not dealt with the issues placed before him. Alternatively, the arbitrator may not have conducted the procedures in accordance with what was agreed. Those examples are included in the types of serious irregularity contained in Section 68 of the Arbitration Act 1996. As noble Lords are aware, the Government intend to use their power to apply this part of the Act, modified as appropriate, in England and Wales, and a parallel provision will be written into the scheme for Scotland.

9.45 p.m.

Lord Wedderburn of Charlton: My Lords, before my noble friend leaves this point, I understand the situations he describes and what the parties can do in terms of making an application for serious irregularity, but what does he say a party should do if he finds that the arbitrator has made his award based upon principles which have little to do with unfair dismissal?

Lord Haskel: My Lords, I do not know whether that is a question one can answer at this stage. We are dealing here with material irregularity and serious irregularity. I am not sure whether the point my noble friend has made comes under that category. We cannot apply the Arbitration Act serious irregularity provisions north of the Border. Serious irregularity is specifically defined in the Act. However, we can specify what we regard to be material irregularities for the Scottish scheme by listing those which we consider appropriate from the list in the Act. We do not propose to include any other irregularities which might be called material. Our intention is therefore limited; namely, to ensure that the two schemes will be as similar as the laws permit. The powers of the Bill would extend to material irregularity.

Lord McCarthy: My Lords, the provision is based on Section 68 of the 1996 Act which mentions serious irregularity but then mentions another qualification. Is the Minister producing some additional ground or does he accept all the grounds in Section 68? Are we to have the provision exactly as it is in Section 68?

Lord Haskel: My Lords, I can repeat only what my noble and learned friend Lord Archer has said; the scheme has not yet been prepared. When the ACAS scheme is prepared, everything will be quite clear.

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I cannot give any undertaking when the ACAS scheme will be prepared. The responsibility for preparing the scheme lies with ACAS.

Lord Gladwin of Clee: My Lords, will the scheme be prepared before the Commons reaches either Second Reading or the Committee stage?

Lord Haskel: My Lords, I am not sure. I can give no undertaking that the scheme will be drafted until the Bill has completed its passage.

Baroness Turner of Camden: My Lords, is the Minister saying that the scheme will not be available until after the Bill has gone through all its stages and is on the statute book? Is that the situation?

Lord Haskel: My Lords, that is the situation. Turning to the arbitration scheme, the essential point about the scheme is that entry into it is voluntary. Both parties have agreed to submit their dispute to an arbitrator and to abide by the arbitrator's decision. They may prefer the finality which it offers, or they may seek a speedier resolution, or they may prefer greater privacy, but most importantly they will be aware that there is no appeal on points of law. Finality is an aspect of the scheme which not only the Government and ACAS--here I give an assurance to my noble friend Lord Gladwin--but also the TUC and others consider to be vital. It is clearly important that the provisions of the scheme should be different from the provisions of tribunals.

I turn to the questions from my noble friend Lord McCarthy. He asked when the scheme can be seen. I have already responded to that point. Regarding any precedent based on geography, I shall write to the noble Lord on that matter. As to whether all the measures will be included in the scheme, I am afraid that we shall have to see what the scheme provides. Can the principles be put on the face of the Bill? We think that we are putting the principles on the face of the Bill.

I do not wish to draw out the discussion further at this late hour. I conclude by saying that the Government support the amendment of my noble and learned friend Lord Archer but cannot support that of my noble friends Lord Wedderburn, Lady Turner and Lord McCarthy.

Baroness Turner of Camden: My Lords, perhaps I may respond to the debate on the amendment and on the amendment to the amendment. I am sorry that the Minister does not feel able to accept the amendment drafted by myself and my noble friends. I have listened carefully to the reasons given for the lack of support for it. I was hoping that, before the Bill reached another place, the ACAS scheme would be available and therefore it would be possible for the other place to consider what we have said here in conjunction with the ACAS scheme. I believe that that would have been easier for everyone. However, we have just been told that the ACAS scheme will not be available until the Bill has been through all its stages and is on the statute book. I regret to hear that.

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However, in the light of what has been said, in particular by my noble friends Lord McCarthy and Lord Wedderburn--they have both had extensive experience in this area; my noble friend Lord McCarthy is an arbitrator--that, when the Bill reaches another place and is in Committee there, some attention will be paid to what we have said in this House.

I believe that what we have said is quite important. From the standpoint of the future appellant, it is perhaps very important. As we have all indicated, we wanted to ensure that without any doubt the scheme on both sides of the border was exactly parallel. With respect, I do not think that the amendment by my noble and learned friend Lord Archer achieves that, but our amendment would have done. I regret that the amendment has not found greater favour with my noble and learned friend and the Minister. However, in the circumstances it is not our intention this evening to press the amendment. I beg leave to withdraw the amendment.

Lord Archer of Sandwell: My Lords, I must have made a complete pig's ear of introducing the debate. I totally failed to make clear what the amendment was about. From the speeches of all my noble friends and--I say it with pain--the noble Lord, Meston, who is usually on the ball in these matters, one would have thought that what we were proposing was that in England and Wales the methods of challenging an award were to be based on Section 68 whereas in Scotland they were to embrace everything included in the word "appeal". That simply is not what was being proposed.

There are two quite separate issues. First, what should be the extent of the power to make arbitration schemes conferred by this Bill? Secondly, and quite separately, what use should be made of that power when the schemes come to be made? The extent of the power is intended to be in the widest terms--just as wide in England and Wales as it is in Scotland. That is the intention; and that is what my amendment--and I think possibly my noble friends' amendment--would achieve. What use is to be made of that power is a quite separate matter and I fully understand the feelings of my noble friends about it. I understand their anxieties.

We have had the debate before. I do not propose to extend this debate by going into the merits of that matter tonight. But that is not what we are debating. That is not what we are talking about writing into the Bill; and that has nothing to do with either my noble friends' amendment or mine. The question as regards the Bill is how we achieve the widest power, however that power is to be used.

I have said it before; in fact I believe I have said it twice; and I have now said it again. "If I say it three times, it is true." If I have still failed to make the matter clear, there is nothing more that I can do about it.

Perhaps I may deal briefly with two matters that arose. The first relates to the modification provisions referred to by my noble friend Lord Wedderburn. The modification provision, in Clause 7(6) of the Bill enables the Secretary of State to modify Part I of the Arbitration Act. The Arbitration Act does not apply in Scotland. That is why the procedure of the modification provision cannot be used to get that result.

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The second matter relates to references to Europe. My noble friend Lord Wedderburn rather gave the impression that the advantage of the amendment moved by my noble friend was that it enabled references to be made to Europe, implying that the present scheme of the Act, as amended by my amendment, would not have that effect. Of course reference can be made to Europe whichever channel we go down.

Perhaps I may clarify the question raised by the noble Lord, Lord Meston. If I referred to "such wider appeals as were required by Europe", I meant "such further appeals"; they may not be much wider. However, we do not yet know, because the European Court is still considering the matter. So I cannot take the question any further.

There would be no point in spinning out the debate any further. I apologise if I did not make the matter clear at the outset. Perhaps in future debates I shall say it three times when I introduce such matters.


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