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Baroness Turner of Camden: Do Members on the other side of the Chamber appreciate that when we talk about trade union membership, it is something entirely voluntary? People voluntarily decide to join a union and once they are in a union, they simply want to ensure that they receive their legitimate rights. Quite frankly, the noble Lord, Lord Taylor, made the case for us to

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some extent when he said that 50 per cent of the private sector workforce was involved. If that is the case, we are really talking about a very large number of employees. If we do not have legislation of the kind proposed by the Government, those employees will not have the rights which really ought to be theirs.

Lord Monkswell: The noble Lord, Lord Tebbit, seemed to think that trade unions were a hindrance to economic activity in industry. He mentioned the fact that small firms may not have a personnel manager, a training manager or indeed a health and safety officer. However, perhaps I may suggest that the expertise which exists within the trade union movement could be an asset to small businesses in terms of providing the sort of advice and information on such matters as health and safety at work and training with which a small company may find it rather difficult to cope. Surely that should be seen as an asset.

When my noble friend the Minister responds, I am sure he will argue that the amendment should not be accepted. However, paragraph 6(6)(b) suggests that the number of workers specified may be varied and that,

    "different provision may be made for different circumstances". Can my noble friend say whether that provision has been included in the Bill so as to enable the figure of 21 to be moved downwards as employers and workers experience the benefit of trade union recognition?

Lord Clinton-Davis: During the course of my noble friends' remarks, I noticed that the noble Lord, Lord Tebbit, assented to a proposition being imputed to him; namely, that he did regard trade unions as a form of encumbrance and as being hostile to the interests of the economy. I draw that to the attention of my noble friends because I believe that it illustrates the noble Lord's attitude towards trade unions and that it ought to be on the record. Of course, a nod of one's head does not indicate that at all. It is precisely because the noble Lord adopted this attitude of hostility that much of it was reciprocated during the period in which he held office. However, we have, happily, moved on from that unhappy experience.

The Bill is designed to create a different attitude in industry--one which the noble Lord finds disagreeable but one which I believe most people would regard as being very desirable. I hope that the noble Lord might, in his more elderly wisdom, come round to a rather different conclusion from that which he entertained during his period of office.

Lord Tebbit: The noble Lord has forgotten that in my younger days I was a trade union leader; indeed, not an altogether terribly pliant one. I was forced into that position by a very bad employer called "a nationalised industry." When you are dealing with a management which is perpetually mucked around by Ministers and is unable to manage, people are forced into that sort of position. I understand that full well. Of course, with no shareholders to fire the management which was wrecking the business, we experienced very great difficulties in getting anywhere in our negotiations.

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If unions have anything to offer--and the noble Lord, Lord Monkswell says that they have--I am sure that employers would be very happy to accept it. I can imagine a number of the operators of our ports would be most anxious to accept advice from the dockworkers' union on how to run our ports. It was constantly doing so over a very long period of time during which all the jobs vanished to Rotterdam and such places. However, where there is such advice, I am sure that it will come forward.

It seems to me that the noble Lord, Lord Murray, has forgotten the basic intent of the Bill. It is not about giving people the right to belong to a trade union because everyone has that right; it is about intervening in the negotiations between a trade union and an employer and insisting that an agreement is reached that the union will be recognised as the negotiating body. In other words, it is arbitrarily taking the view that the trade union should be the negotiating body.

Lord Davies of Coity: The one point that the noble Lord has failed to express is the fact that a trade union does not operate in isolation from its members' wishes. When it makes representations to an employer seeking recognition, it does so on behalf of those workers who are employed by that employer and have joined the union. It is not an arbitrary situation and it is not a third party situation; indeed, it will be done directly on behalf of the workers employed by that employer.

Lord Tebbit: I fully understand that. However, the noble Lord does not seem to understand that there is another party involved; namely, the owners, the proprietors, of the business. They have created a business which enables them to offer employment to their workers. Do they not also have rights? Do they not have the right to run their business in a reasonable way within the limits which the law imposes?

Lord Davies of Coity: I understand that perfectly well. However, the two sides of industry are trying to come together in the most harmonious way possible to ensure fairness for the employees and prosperity for the employer. That, in turn, will run through to the employees. It is a case of working together. But when you see an employee faced with his employer, it is rather like a David and Goliath situation. Only collectively is any influence brought to bear on an employer, who is the stronger of the two parties.

Lord Tebbit: I must say that the prospect of a firm employing 21 men or women faced with the Transport and General Workers' Union could indeed be seen as a David and Goliath situation. Unfortunately, I think the noble Lord has got the roles reversed. He talks about harmony. My goodness me, does not every married couple want to live in harmony? However, they do not want the mother-in-law constantly coming in and telling them how to do it. That is what this Bill is. It could be retitled the Mother-in-Law Bill, or perhaps I should say the Father-in-Law Bill, so that I do not fall victim and transgress in some way as regards anti-discriminatory laws.

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Noble Lords opposite simply do not agree that an employer has the right to say, "No thank you. I would rather deal with my own employees directly and I would like to deal with them as individuals." That applies particularly in a small firm comprising 21 people. That is a better way to manage a company. After all, there is a choice for the employees. It is often possible to find another job in a larger, unionised company. Happily, on the whole, these days we have relatively low levels of unemployment in this country. It is not as though we were living in Euroland, in Germany, in Spain or in one of those countries where they have all these sorts of laws but also have extraordinarily high levels of unemployment. It is more as though we were living in America in some ways where, in a deregulated economy, jobs are created without--I should point out to the noble Lord, Lord Monkswell--too much assistance from the trade union movement.

Lord McIntosh of Haringey: Perhaps I may start by acknowledging the passion with which noble Lords opposite addressed the issues raised by these amendments. Although the argument became rather expanded, the noble Baroness, Lady Miller, has a genuine passion for the interests of small businesses which she has expressed throughout her time in politics. I respect her for that. However, two further aspects have become apparent. First, there is the passion which a number of noble Lords opposite have against trade unions wherever they may appear, whether that be in small or large firms. It is when the noble Lord, Lord Tebbit, characterises the interventions of trade unions as being those of difficult trade union activists that we come out into the open.

The second matter that has become apparent is the passion with which we in the Labour Party address the issue of individual rights and collective rights at work. As has always been acknowledged, there is no dispute about the right of any individual to be a member of a union and to benefit from the services and facilities which a union may provide. However, alongside that--although this should not be confused with it--is the right to make one's membership of a union effective through collective bargaining. The noble Lord, Lord Tebbit, manages to turn the story of David and Goliath on its head. The issue here is a profound political and economic one. It would do no justice to anyone in this Chamber if I did not acknowledge that from the beginning. I acknowledge the sincerity with which noble Lords opposite address this issue but we profoundly disagree as regards the purpose of this Bill.

The principle behind statutory trade union recognition is the protection of vulnerable members of society. Everyone may agree that that is a worthy aim. However, it must be understood that in applying this principle we have sought to use common sense, excluding firms where collective bargaining may not be appropriate. We have done our best not to impose unnecessary costs on employers. However, the fundamental principle of protecting the vulnerable means that we cannot ignore workers in smaller companies.

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Much has been made of different cut-off points for smaller and larger firms. I refer to the different cut-off points used in Europe and the different cut-off points used for different purposes. I remember the Boswell report on small businesses that was issued many years ago. I remember that that report proposed a cut-off point of 200 employees because that was thought to be a sensible way of dealing with those who did not comprise the large organisations on which macro-economic policy had been based for many years. That was a breakthrough because for the first time the interests of smaller businesses were recognised. That was a valuable step. But surely the cut-off point for one purpose is not necessarily the cut-off point for another. Health and safety measures have to be in place in workplaces of all sizes. One cannot say that someone who works in a firm that comprises only three people cannot be protected from burning to death through not having appropriate health and safety measures in place. In other respects a cut-off point of 50, 100 or 200 employees may be quite appropriate. With regard to the cut-off point of 21, we do not suggest that it is perfect or that it is in any way a magical figure. It has been selected after much consultation because we recognise that employees of small firms are often dealt with on a personal basis and collective bargaining is not likely to be appropriate for them.

Let it not be thought that that means that those firms with 21 or more employees will be forced into collective bargaining. That, of course, is not the case, as my noble friend Lady Turner made clear. If there is to be collective bargaining, it has to be agreed by a majority of those voting and by 40 per cent of those eligible to vote. If that is not the case, I am sure that an employer who has a larger number of employees and good relationships with his workforce will ensure that there is no vote for compulsory collective bargaining. In that situation, voluntary agreements are much more likely which will suit that workplace. Some of those will concern basic pay, holidays and hours and others will concern other issues. The whole point of this Bill is that those measures can concern the subjects that employers and employees believe constitute the proper basis for collective bargaining.

I return to the arguments of the noble Baroness, Lady Miller, which I think we have lost sight of. We do not believe that collective bargaining will impose significant costs on small firms. I am sorry to repeat this but I speak from personal experience. I am convinced that the collective bargaining that I achieved by recognising a union in a company with 30 to 35 employees was beneficial to management. Against the cost of collective bargaining should be offset the costs of setting pay by any other method. Sometimes it is more efficient to bargain collectively. It is also likely that respecting workers' wishes for union representation will improve morale and hence productivity. A number of my noble friends have made that point effectively.

The figure of 20 or 21 is of course a pragmatic judgment. However, I say to the noble Baroness, Lady Miller, that it is not true--as she said--that we acknowledge that it may be too stringent. We

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acknowledge that it may have to vary in either direction. It could be too stringent or not stringent enough. We have provided a possibility for variation in the Bill. The Secretary of State may initiate a process whereby the cut-off point changes. Our subsequent amendments in the group commencing with Amendment No. 7 extend that provision to ensure that the possibility of variation applies throughout the Bill. We believe that this is the right figure and we believe that the amendments that I have discussed should be rejected.

I now turn to Amendment No. 6 and its associated amendments which seek to exclude from the definition of "worker" three categories of person: officers of a limited company; shareholders in unquoted private companies; and members of a partnership. The amendment is unnecessary. Officers of a company are not normally workers, nor are they shareholders. The only way in which a person who is an officer or a shareholder can be a worker is by entering separately into a contract of employment that makes him or her into a worker. I am sure that the noble Baroness is not arguing that those who have contracts of employment should be excluded from the head count implied in the cut-off point of 21. Shareholders and officers who do not have a contract of employment are not workers and do not count towards the figure of 21.

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