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I do not wish to rehearse the arguments in any great detail on behalf of my noble friends Lady Turner and Lord Wedderburn. But the point has to be made that it is not in any sense a contradiction in terms to argue for this amendment and for agency workers to have comparable rights to permanent employees—even if not the same rights—and at the same time deny that flexibility of work benefits both some employers and some employees. As I said at Second Reading, where it benefits employees, fine—let those employees work quite happily in situations and under conditions that suit them, perhaps because of family arrangements or semi-retirement or because they can only work at certain times of the year. That is fine, but there are many people seeking full-time employment whose only recourse is to agency work, which is the very antithesis of full-time, permanent employment. I was struck by the regular use of “end user” by my noble friend Lord Wedderburn. That seems utterly appropriate because it is what the end users are doing to the people whom they employ on an agency basis—they are using them. That is quite clear. I am sure that the term was not meant unkindly in that way, but that is what it amounts to and it has to be exposed for what it is.
Many of the arguments were made in an excellent debate on Friday in another place. However, the bottom line is that there is insecurity for agency workers. I have not been an employer but I should have thought that any employer would want the people working for him or her to feel sufficiently secure in doing a job in order to contribute to the benefit of that business, service, voluntary organisation or whatever. As was backed up in some of the testimonies given in respect of the Bill in the other place, if people feel insecure—if they cannot join pension schemes, get proper paid holidays or get reduced sick pay—that impacts not just on those individuals but on their families. When we are talking about flexible working, there has to be an element of fairness, and I shall come back to that in just a second.
We heard all sorts of stories on Friday about aspects of salaries—uniforms, travel and accommodation—that are directly deducted and over which people have no choice and there is no opt-out. People have to accept them whether they want them or need them. The final insult is being charged for cheque-cashing facilities at the end of the week. These are just employers’ ruses and I do not think that anyone can seriously seek to defend them. No training is offered and, as I said earlier, there is no security. Many such employees go well beyond the qualifying limit for taking cases to employment tribunals and it is iniquitous that they should not have the right to do that. If an employer acted in a way that would enable a permanent employee to take his or her case to a tribunal, the same should be true for someone who is not a permanent employee.
My noble friend Lord Wedderburn said that this was really about the right of people to be treated fairly. When the Minister replied to the debate on Amendments Nos. 17 to 19, he reminded us that he was the first to speak up in favour of reducing what he termed the employers’ burden, but then he said that he was also the first to seek fairness in employment. That is exactly the nub of the argument
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Lord Jones of Birmingham: I have listened carefully to all the submissions and, first, I make a plea that we remove the alarmist language from this whole debate. From my noble friend Lord Wedderburn I heard that this is a complete group of workers that is “unjustly treated”. That is not true. Some are but many are not. I heard about “abuse of economic power” and about people needing to be “protected”. Just now from my noble friend Lord Watson, I heard about what is being done to these people and that it needs to be “exposed for what it is”. At the same time, from my noble friend Lady Turner I heard the words “both sides of industry”. All that smacks of 1970. It smacks of exactly what the private sector—both unions and employers—over the past 15 to 20 years, and especially the past 10, have worked so hard to avoid. One reason why we have the most successful economy in the whole of Europe is that we have the most flexible labour market. Whatever certain people with vested interests might tell you, there is a connection between low levels of unemployment and high levels of flexibility.
I do not recognise the word “industry”; I recognise the world of employment, of business and of the public sector. I do not see sides. Six and a half years as director-general of the CBI made me understand that there is only one side in the private sector: it is those people who come together to create a successful undertaking from which everybody can benefit. It is not true that every one of those people who enters a contract by which they can retain agency workers works in such a way as to do them down. I come across many agencies that train agency workers a great deal, based on the selfish realisation that the more they train them, the higher the rate that they can command for entering a contract for the provision of their services and, by definition, the greater the take-home pay of the agency workers.
I hope that, on this amendment and Amendment No. 26, and when the House debates what is happening in another place now, we will remove the alarmist, damaging vocabulary that belongs to another age. We are in the 21st-century world of work; there are many people across Britain who do not recognise the vocabulary that my noble friends have used. Flexibility is a two-way street. Agency work often provides an entry to the world of work that has been denied to many people in the past. It provides an entry for those who come out of prison and try to go straight; it provides an entry for many a woman who is trying to get back into the world of work after some time out, either to have children or to care for an elderly relative. It provides an entry for students during their summer vacations, allowing them to get used to the world of work and to learn that the pleasure of earning a living is not entirely ours.
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The 21st-century world of work contains people who abuse the situation, who treat agency workers abominably and who need to feel the power of regulation to make sure that the abuse stops and to ensure the fairness—I thank the noble Lord, Lord Watson, for saying it—that I respect in the workplace. However, it is a minority. They must be weeded out and it must stop. I was very influenced by going to BMW’s Mini plant in Oxford. It is a fabulous brand; the engine is made in Britain. It sells around the world, creating jobs and wealth for this nation. While it has a fully unionised, full-time workforce, it is huge user of agency workers, to deal with peaks and troughs and the availability of student labour in the summer, when holidays eat into the full-time workforce commitment. The owners of the plant said to me: “If this stops, if this puts us on an equal footing with Germany, France, Spain and Scandinavia, please explain to us why we should carry on investing in this country”. They are not gangmasters; they are not the people who should be weeded out and stopped; it is a high-class German manufacturer making a fabulous, globally successful product in this country, creating quality jobs and caring for its workforce, and saying that the ability to have a flexible workforce with agency workers is not only something that it values but is one of the reasons that it invests in this country. I as chairman of UK Trade & Investment valued its investment and trust in my nation enormously.
I am with my noble friends when they say that we must stop the abuse that goes on, but I plead with them to stop the alarmist language. Let us perhaps find a term which applies if someone is in a relationship with an employer for such a long time that, as my noble friend Lord Wedderburn said, they are employees and deserve the protection as such.
The Government are not against that. I remind my noble friends that the Government are elected to govern for the whole country, not one vested interest—be it the CBI, the TUC or anybody else. The Government are not against saying, “Let us have some regulations and protection in place for people in the same contractual relationship for so long a period”. As the lady from Greenwich found out, they are frankly being treated as an employee and should be protected as such.
Let us not throw the baby out with the bathwater, or get to a point where the big and quality investors in the country leave. Globalisation gives them choice, and a flexible labour market is ultimately one of the reasons they choose Britain. It is, frankly, to be solved by a period of time after which such workers will be treated as employees in all respects. That period is currently up for negotiation. We are awaiting a lead from the European Commission, and for Brussels to come up with some ideas and thoughts to get this sorted once and for all. Members of the Committee will not find the Government against that, provided it does not eat into the flexibility at the constructive-quality end that helps not only those who make proper use of agency workers, but those in society who want to avail themselves of agency work for all the reasons I have mentioned.
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The Government have undertaken a review of the current framework to cover all employment rights, determined by an individual’s employment status, to see if that is still appropriate, whether those rights fit into the 21st century, whether they are fair and whether they can support our aim of getting a high participation in the workplace. We are looking specifically at the differing rights and responsibilities in employment law of “employees” and “workers”.
[The Sitting was suspended for a Division in the House from 5.31 to 5.41 pm.]
Lord Jones of Birmingham: I remind the Committee that I was referring to the review that was undertaken. While undertaking that review, we found that temporary work such as agency work is greatly valued by employers and many individuals. I know that “workers” and “agency workers” are specific terms used in legislation and I use them accordingly. But other than that, I prefer to use words such as “employees”, “self-employed” or “individuals”; I see the word “workers” in the divisive way that I see such words as “bosses”, “industry” and “sides”.
We were given examples of abuse and lack of knowledge about existing rights but there was a lack of evidence that the appropriate response from government was a wholesale change of the current system. That was not going to be welcomed. Employers commented that extending all rights would be likely to result in a reduction in temporary work and that these lost jobs would not all be replaced by permanent ones. The overall conclusion of the review was that the existing framework met the UK’s 21st-century labour market’s needs and there was no need for further legislation in this area. The rationale behind the decision was published in our policy statement, Success at Work:Protecting Vulnerable Workers, Supporting Good Employers, in March 2006, just under two years ago.
This amendment implicitly aims to extend the current coverage of unfair dismissal rights to the wider category of “worker”. We looked at this issue in particular during the review and at the balance of rights and responsibilities. It would be unfair to employees in the workplace to give unfair dismissal rights to individuals who, unlike employees, do not have to give notice or more than short, limited notice if they wish to leave a job. Those on agency contracts working alongside employees enjoy benefits not available to employees, as employees enjoy benefits not available to agency workers. Flexibility is a two-way street.
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If this right were extended, employers would be likely to respond by requiring workers to give extended periods of notice, undermining the very flexibility that we know both employers and workers value; and the economy values that flexibility. That is why—I repeat—we have the most successful economy in Europe and the most flexible labour market. This would reopen issues that we carefully considered as part of the review.
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The Government do not support the amendment, but we support the principle of equal treatment for agency workers. We consider that the best way forward to achieve that is for an agency workers’ commission in the United Kingdom, involving all interested parties from all sides of society in the workplace, to address that point and to devise a means of achieving equal treatment while preserving the flexibility that both sides want, and which preserves the flexibility of the UK labour market.
The Government take the protection of agency workers extremely seriously. That is why, for instance, last autumn we announced the doubling of employment agency inspectors. I would sincerely caution noble Lords to avoid damaging this very successful employment economy to attack—rightly—a small but damaging minority. We must protect those people. Please do not harm the rest of it to achieve your ends.
Lord Wedderburn of Charlton: I ask the Committee to remember that the words about abuse, the use of economic power and the like, and the need for legislative intervention were used not by me but by Mr Justice Elias, who has enormous experience of employment cases and who also made reference to flexibility in the labour market; and by Lord Justice Mummery, who pointed out, if it needs pointing out, the enormous explosion in the numbers of agencies where people go to get a job. Of course I understand the desire that the Minister mentioned of a woman with children getting into a job in this way, if there is no other way to get it, but I do not like the fact that she can be disposed of at will without any notice, and chucked out of her job because she has no employment rights.
Secondly, my noble friends know that I do not often pray in aid as a force the European Commission, but I do on this occasion. Its Green Paper on the future of labour law pointed out that there must be a balance to achieve what it calls, and what is now the new word in all the writing on the subject, “flexicurity”. It is not yet in the dictionary, but flexicurity, it explains, contains two things—first, a flexible market that especially the employer will find extremely useful in the day-to-day and even long-term running of his business; and secondly, security for workers in regard to employment rights. The European Commission’s whole Green Paper is based on that balance.
It is not very easy to achieve a balance. Sometimes in the debate today I felt that we were back in 1971, when people suggested to the Conservative Government, who wished to introduce it, that the right of unfair dismissal to be allowed to workers in employment tribunals would totally upset the labour market. Unfair dismissal has been with us a long time. Agency workers are entitled to that right as much as other workers with whom they work cheek by jowl at the workplace. The amendment is intended to promote that balance, first by new powers. The amendment takes the regulation route. Maybe that is wrong. My honourable friend’s Bill in the other place may be a better way of moving the situation forward.
One thing is absolutely clear: we are in a moving situation. The Prime Minister’s offer proves that we are not now static on agency workers. The unfairness
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We aim for flexicurity, as the Green Paper suggests, and want a balance. Of course, I do not suggest that all employers act in an abusive manner towards either permanent or agency workers. As with the right to complain of an unfair dismissal, the amendment is intended to stop the minority of employers who abuse their power to dismiss. I can only say that anyone who reads the report of the debate of last Friday in the House of Commons and pays attention to what has been said will see that we are in a moving situation, whether the answer is a European directive or a new statute, as my honourable friend Mr Miller suggested in the Commons, or whether, as the amendment suggests, the Minister makes use of existing powers in the 1999 Act to improve the position of a substantial group of workers. That was the object of the amendment, and I hope that we can all agree, having read last Friday’s debate and the terms of my suggestion, that we want flexicurity. We want a flexible labour market, but you cannot have one in the 21st century without giving agency workers basic rights which we have come to see as fairness at the place of work. I thank everyone who has spoken in the debate.
Lord Jones of Birmingham: I am grateful to my noble friend Lord Wedderburn for making a plea for fairness in the workplace. We all want that. I hope that his knowledge of the law would be such that he will respect another law: that of unintended consequences.
France does not have the concept of agency workers in the same way at all. France has an enormously high rate of unemployment, and very low take-up of people coming into the workplace. Why? Because employers in a globalised economy vote with their feet. They go to places where they can avail themselves of a flexible labour market. Germany has high unemployment, and an even higher level of people who are not even entering the world of work for the first time. We excel in both those areas. One reason is that employers can avail themselves of agency temporary workers. The solution is a period when, at the start, an employer or someone wishing to avail themselves of agency temporary work can actually enjoy the same situation on both sides as exists today. But, after a period of continued work, the protection that my noble friends seek would click in. That would prevent so much of the abuse to which my noble friends so rightly draw the Committee’s attention, while providing the flexibility, for a few months at a time, that so many employers need to compete in a globalised economy and our society needs to fulfil full employment.
We are trying to sort out what that period is with Brussels. I hope that the debate last week in the other place shed some light on it, and I am sure many Members of the Committee will have something to say about it. That is the solution. However, if you make it known and put agency workers in precisely the same position as those who are employed, you will suffer in a globalised economy because people will vote with their feet and go elsewhere. They will not create permanent posts to take those people’s places;
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Lord Wedderburn of Charlton: I take that to be a question—I was in a semi-recumbent position—but I agree with a lot of it. I think that my noble friend Lord Watson referred to parallel rights for agency workers. Slight differences may be desirable to stop this minority of employers abusing, as Mr Justice Elias said, their economic power over people who have no rights. When we introduced the notion of unfair dismissal to the Conservative Government, we did not say that all employers dismissed unfairly; we said that there were such cases and that workers should have a right to appeal against it.
I do not think that the Minister referred to the European Commission’s Green Paper and the notion of flexicurity, which is now spattered throughout the literature of western Europe. I did not suggest that we should have the same law as France or Germany—that would be absurd. It would be as absurd as Michael Gibbons’s reference to adopting part of New Zealand law without going into the special circumstances that make it relevant to New Zealand.
I say that we should have a right to promote fairness in the workplace, and that moves us to discussions on agency workers, whether that is put to a royal commission or any other inquiry. In 10 years’ time, I do not believe that agency workers in Britain will be deprived by the law of rights that are equivalent to those of permanent workers, as they are today. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Borrie moved Amendment No. 22:
(1) Where proceedings include a claim under the Public Interest Disclosure Act 1998, the President shall, within 28 days of the conclusion of the proceedings, publish the relevant papers electronically and without charge.
(3) A decision may only be made under subsection (2)(b) where the tribunal or the President is satisfied that the publication of that information would be contrary to the public interest.
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“conclusion” means determination, withdrawal or settlement of the case or the time when no party has for the previous six months notified the tribunal of action to progress the case to hearing;
“relevant papers” means any claim, response, further particulars, decision, determination, notice of withdrawal or settlement and any decision under subsection (2)(b); and
The noble Lord said: First, I declare an interest as patron of Public Concern at Work, commonly known as the whistleblowers’ charity. This charity took the initiative in promoting the Public Interest Disclosure Act 1998, which has its 10th anniversary this year. That Act encourages responsible whistleblowing by employees. It was introduced in the other place by Richard Shepherd, a Conservative Member of Parliament, and in this House by me. It protects employees who express concerns about wrongdoing that threatens the public interest and, in particular, it gives a remedy to a whistleblower who is sacked or otherwise disadvantaged in the workplace. It provides protection most readily where the concern is raised with the employer, but it also protects disclosures made to regulators and wider disclosures where they are justified and reasonable.
When the Act was passed 10 years ago, the legal position was that information about claims made under it would be on the public record. This was important because openness would help to discourage specious claims by employees and encourage employers to deal and cope properly with any significant public-interest risk raised with them.
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