Employment Relations Bill
Letter from the Parliamentary Clerk, Department
of Trade and Industry
Lord Alexander has written to the Lord Simon about
the Government amendment inserting a new clause after Clause 32
which had been tabled for consideration during the second day
of Committee. At Lord Alexander's suggestion the amendment was
not moved at the appropriate moment in Committee thus giving the
Delegated Powers Committee an opportunity to consider the amendment.
Memorandum by the Department of Trade
The Department has prepared a short note which may
assist the Committee in its consideration of the proposed Government
17 June 1999
After Clause 32, insert the following new Clause
section applies where regulations under section 2(2) of the European
Communities Act 1972 (general implementation of Treaties) make
provision for the purpose of implementing, or for a purpose concerning,
a Community obligation of the United Kingdom which relates to
the treatment of employees on the transfer of an undertaking or
business or part of an undertaking or business.
(2) The regulations may make the same or similar
provision in relation to the treatment of employees in circumstances
other than those to which the Community obligation applies (including
circumstances in which there is no transfer, or no transfer to
which the Community obligation applies).")
The Government wishes to take a power to enable Regulations
under the European Communities Act 1972 to be made which would
apply the provisions of the EC Acquired Rights Directive in circumstances
other than those to which the Directive applies. It would thus
enable the successor to the current Transfer of Undertakings (Protection
of Employment) Regulations 1981 (SI 1794) to be applied to a wider
range of circumstances than covered by the Directive, when those
new Regulations are introduced following consultation.
These Regulations are designed to safeguard employees'
rights when the business in which they work changes hands between
employers. The intention is to replace them in order to improve
their operation, following the negotiation, under last year's
UK Presidency, of a revision of the Directive itself. Detailed
proposals are being drawn up, and there have been informal discussions
with bodies representing employers and employees, and other interests,
particularly those involved in the application of the legislation
to the contracting of services. There will be public consultation
later this year, but it is apparent from the discussions which
the Government has already had with business and other interests
that existing powers under section 2(2) of the European Communities
Act would be insufficient to achieve some of the changes they
may ultimately wish the Government to make.
In particular, existing powers would not allow extension
of the scope so as to bring within the coverage of the Regulations
individuals who would not be covered by the Directive. Business
interests as well as employee representatives are seeking such
an approach in order to ensure that the Regulations have a clear
and consistent application, notably in the area of contracting
out of services and in transfers within public administration.
The use of the power will thus depend on the outcome
of consultation. It is expected there will be a general consensus
about the way in which this should be done in due course.
It is the case, so far as we know, that this is an
unprecedented extension of Article 2(2) (apart from the European
Economic Area Act 1993 section 2(4), which provides for levelling
up to any higher standard voluntarily provided for EC persons).
However it is not at all uncommon for there to be power to go
beyond Directive obligations. Clause 17 of the Bill is an obvious
example and there is no difference in substance. The reason for
extending 2(2) is because the Government wants to create a seamless
link between what the Directive may or may not require and what
we are doing voluntarily.
The point is made that by latching on to 2(2) we
are attracting the very wide powers under that section, including
the power to amend primary legislation. However, if primary legislation
is being amended for the purposes of the Directive we want the
same result to apply. The draft clause makes clear that it is
only the same or similar provision that can be made. In practice
it is likely to be identical in that the Regulations will simply
apply in the wider area covered as a result of the power.
17 June 1999