§ Mr. Whitelaw
I beg to move, in page 2, line 13, to leave out from the first "for" to the end of line 17 and to insert:twenty-six weeks or more, the provisions of Schedule (Rights of employee in period of 1116 notice) to this Act shall have effect as respects the liability of the employer for the period of notice required by section 1(1) of this Act".
§ Mr. Deputy-Speaker
I think that it would be convenient to the Committee to discuss at the same time the following Amendments: In page 2, line 19, leave out "two years" and insert "twenty-six weeks".
In line 20, leave out from "employment" to end of line 25 and insert:the provisions of Schedule (Rights of employee in period of notice) to this Act shall have effect as respects the liability of the employer for the period of notice required by section 1(2) of this Act".In line 26, leave out from "apply" to end of line 31 and insert:in relation to a notice given by the employer or the employee if the notice to be given by the employer to terminate the contract must be at least one week more than the notice required by section 1(1) of this Act".In line 32, leave out subsection (4).
In line 40, leave out subsection (6).
In page 3, line 3, leave out "Schedule 2" and insert:Schedule (Rights of employee in period of notice)".The new Schedule—"Rights of Employee in Period of Notice".
In page 11, line 1, leave out Schedule 2.
§ Mr. Whitelaw
Would it also be convenient to discuss the Amendments to the new Schedule in the names of hon. Members opposite, or would you rather that we discussed those later, Mr. Deputy-Speaker?
§ Mr. Deputy-Speaker
I think that it would be preferable to discuss the Amendments to the new Schedule with the new Schedule, rather than now.
§ Mr. Whitelaw
The new Schedule is, in fact, among the list of Amendments you called, Sir William, and which you suggested should be discussed with the Amendment I moved.
§ Mr. Deputy-Speaker
In which case, if that is convenient to the Committee, then I think that it would be convenient to do so; and the Amendments to the new Schedule which may also be discussed are the following: In line 7, after first "hours", insert:together with an estimated average of hours of overtime".1117 In line 9, at end insert:and references to the employee being ready and willing to work shall be read as subject to the right of an employee to be given reasonable time in which to seek alternative employment".In line 79, leave out paragraph 5.
§ Mr. Whitelaw
Thank you, Mr. Deputy-Speaker.
These Amendments deal with the right to minimum pay during notice given by the Bill. It has been generally agreed throughout our discussions that we must make the right to minimum pay sufficient to prevent the employee from having to face a serious drop in pay when he is having to change jobs. All along it has been easy enough to state these principles, on which there is general agreement, but it has been a good deal more difficult to find a satisfactory means of putting them into effect.
The present minimum pay provisions give the employee entitled to notice under the Bill the right to be paid during notice at a rate no lower than his average rate of earnings over the past 26 weeks. These provisions have come in for a good deal of criticism by hon. Members on both sides of the Committee. It has been pointed out that in some circumstances they could give an employee the right to considerably higher pay during notice than he could otherwise possibly cam. This will happen if he has worked a good deal of overtime in the past six months and if the firm has gone on to short-time working during the notice period. Further, it has been pointed out that the record keeping and calculations necessary to work out the entitlement on the basis of a 26-week average are far from negligible, to put it mildly.
We made it clear on Second Reading that we were ready to consider alternatives, provided the essential safeguards were maintained. My right hon. Friend explained what he meant by "essentials" when he said:What is clearly essential is that the Bill should ensure that where the contract of employment fixes a wage for a normal week's work, the pay during notice should not fall below this; but when the contract does not fix such a wage there should … be a guarantee related to previous earnings."—[Official Report, 14th February, 1963; Vol. 671, c. 1510.]1118 In Committee we had a valuable discussion of this extremely complex question. We gave an undertaking then to consider all the suggestions put forward. We have now done that and, as a result of our consideration, we have been led to table the Amendments which we are now discussing.
The new formula we have put forward now owes a great deal to an Amendment tabled in Committee by my hon. Friend the Member for Aylesbury (Sir S. Summers). My right hon. Friend and I are extremely grateful to him for his suggestion, which has enabled us to devise rules which, I venture to hope, may be accepted by all hon. Members as making a real improvement on those at present in the Bill. I must take some time to explain carefully, and I hope clearly, the new rules and how they will work.
A distinction is made between employees who have normal working hours under their contracts and those who do not. Of course, the very great majority of employees have normal working hours. There are comparatively few categories of employees, such as commercial travellers, who do not. A man who has normal working hours and who works at least those hours during notice will be paid his earnings under his contract. No provision is necessary in the Bill to protect him, for he is already safeguarded by his contract. It is worth pointing out that this will deal with the great majority of cases.
Where safeguards are necessary, however, is if the employee is prevented from working his normal hours during notice, either because the firm is working short time, or because of a temporary lay-off, or because he is sick or because his holidays fall during that period of notice. For any of these circumstances a safeguard is provided by paragraph 2 of the new Schedule. If the employee is paid on a time basis then under paragraph 2(2) he is assured of being paid for the normal working hours not less than what he would have got if he had been working throughout them. If, however, he is on a piece-rate system of pay, then under paragraph 2(3) for each of the normal working hours during which he does not work he is to be paid at a rate no less than his average hourly rate of earnings 1119 over the last four weeks before notice was given.
We now come to the employee who does not have normal working hours under his contract. He is given a guarantee under paragraph 3 similar to that in Clause 2(1) of the Bill as it stands now. It is, however, based on an average payment over only 12 weeks. It does not seem necessary to retain averaging over 26 weeks for the purposes of covering what I think will be accepted as the relatively very small proportion of employees to whom paragraph 3 will apply.
These new provisions seem to have considerable advantages. By sticking more closely to the rights in the contract they interfere much less drastically with existing arrangements than the yardstick at present in Clause 2(1). One result is that many of the anomalies to which the present pay provisions are subject are removed and others of them are reduced. Another desirable result is that these provisions are far simpler to work. In the great majority of cases no calculation based on previous earnings is needed. Where a calculation is needed, it is much simpler than the calculation at present in the Bill. The provisions guarantee the employee a reasonable wage during notice, and one that is perfectly in keeping with the principle that I said earlier we regarded as essential.
In one important respect, the employee's safeguards will, in fact be improved. Under the present provisions in the Bill, if any employee has been consistently on short time in the six months before he is given notice—and this, of course, is just the situation that might arise in a declining industry—the minimum pay guaranteed him during notice would fall below that of a normal working week. This will not happen under the new provisions. I am sure that the hon. and learned Member for Liverpool, Edge Hill (Mr. A. J. Irvine) will welcome this, because in the Standing Committee he moved an Amendment which aimed at remedying the shortcomings in the present Clause 2, to which I have just referred. I have done my best to explain how these new rules work. They are contained in the new Schedule standing in the name of my right hon. Friend.
1120 I should now like to explain briefly how our other Amendments fit in. The Amendments in page 2, line 13, in page 2, line 19, and in page 2, line 20—
§ Sir S. Summers
Would my hon. Friend say a word apropos the new Schedule as compared with the old one—as to why the old paragraph referring to sickness and injury does not find a place here?
§ Mr. Whitelaw
It might be better if I were to answer my hon. Friend at the end of this debate.
The three Amendments I have mentioned make the necessary drafting changes in Clause 2(1) and (2), including changes to take account of the alteration to Clause 1 to give a right to one week's notice after 26 weeks' employment.
The Amendment in page 2, line 26 makes a change in Clause 2(3). under which Clause 2 is not to apply if the employee has a right to at least a week's notice beyond the minimum laid down by Clause 1. The Amendment is needed to maintain this principle in the light of the inclusion in Clause 1 of a right to at least one week's notice after 26 weeks.
The Amendment in page 2, line 32, drops subsection (4), which is no longer needed. As this provision has, in any case, been the target for a good deal of criticism, this Amendment will probably be fairly generally welcomed. The Amendment in page 2, line 40, drops subsection (6), which also is no longer necessary. The Amendment in page 3, line 3, effects a minor consequential drafting change in Clause 3. Finally, the Amendment in page 11, line 1, proposes the deletion of the present Schedule 2, which is to be replaced by our new Schedule.
I hope that with those explanations—which, I fear, have taken some time—the House will be willing to make the changes to the minimum pay provisions that we suggest. I have not, at this stage, attempted to deal with the Amendments to the proposed new Schedule that have been tabled by hon. Members opposite. I shall, of course, attempt later to answer the points advanced in support of those Amendments, and also to answer any other points that are raised, such as that put forward just now by 1121 my hon. Friend the Member for Aylesbury (Sir S. Summers). I hope that at this stage I have, at least, made the clearest statement on a complex question of which I am personally capable.
§ Mr. J. Robertson
I beg to give notice, Mr. Deputy-Speaker, that at the appropriate time I shall want to move our Amendment to the new Schedule—in line 7, after first "hours", insert:together with an estimated average of hours of overtime".The Minister has set us a very formidable task in dealing with all these Amendments along with the new Schedule and, initially, I shall confine myself to the preliminary part of that Schedule. I must say that the meaning of this part of the Schedule is rather obscure. First of all, it seems to start from the assumption that the meaning of "normal working hours" is known, but it then goes on to define what they are in terms that leave one in doubt about the possible meaning of the original use of the words "normal working hours".
The fact is that there are cases in which it might be said that there are normal working hours for a certain occupation, but that no overtime is payable for any time worked beyond those hours, whether it be the day, the week, or, indeed, any period at all. I should have thought that the difficulty in defining cases where there are normal working hours would have been in this particular instance, but the Schedule, and this part of it in particular, makes no attempt to give a clear definition of such instances. It confines itself to saying that included in the cases of normal working hours are those in which an overtime premium applies when the worker is employed for more than a stated number of hours. This is very difficult. Hours for which overtime payments are made are not to be considered as normal working hours. I do not know quite what to make of that. I think that our Amendment will be required in order to clear up a number of the difficulties I can see.
In order to clarify the position, perhaps I may be allowed to give some examples. The worker employed in what is normally called the rota shift, or on a Continental week would have a normal week of 37½ hours or 40 hours—or, if it were a Continental week working the six-shift 1122 system, 48 hours. The normal working hours for these systems would include each day of the week, but if the worker's normal hours meant that he was called upon to work during the weekend then, although that was considered a normal working period, he would receive overtime payment for working at the weekend. Although, normally, it is a normal working period, it would not be so considered under the definition in the Bill. I agree that it is possible to think of weekend premiums as being other than overtime payments, but the agreements applied in industry describe these payments as overtime payments, and I therefore think that difficulties of interpretation will arise therefrom. The point is that the extra payments are part of the normal weekly wage and, for the purposes of the Bill, should be considered as such.
In the case of the three-shift rota system, the normal working hours would be determined by the working shift rota. These hours would also fall on Saturdays and Sundays and, whether or not extra pay was due, these would be the normal working hours. With the Continental system, when day shift working or day and night shift working operates, it is quite normal to apply the usual weekend overtime premiums to overtime at the weekend, but the overtime at the weekend is part of the normal working week, even if extra money is paid for it. In the arrangement of the shift, the normal method to accommodate the change-over would, perhaps, call for six days a week to be worked, with overtime applying for one of those days. There would then be a break of two, three, or perhaps four rest days, and in order to find the average normal hours one has to take the average over the whole cycle.
The point is, however, that included in this cycle are days for which overtime payments are made, but they are part of a normal week. Consequently, we wish to see the Amendment made.
It is not unusual to find instances where hours are worked outside what are called the normal hours and these do not carry overtime premium, but time off is given in lieu. Circumstances could arise where a day given in lieu would come out of the period of calculation and would affect the total of 1123 money. Pay might also be made up in another way, with a man working overtime being paid with a day off in lieu. If the overtime payment is not counted, he will be at a disadvantage. Therefore, I do not think that we can accept the definition of normal working hours as given in the Schedule.
I have come across cases where regular hours of work exceed those normally applied in the factory, and where the weekly wage included an overtime allowance but this allowance was not attached to any specific period of work. The hours in this case were the hours actually worked in that week. This happens often, but unless the Amendment is accepted this would mean that a worker who received an extra day off in lieu of overtime might have part of his wage taken away, even though the full wage was considered to be the normal wage in his circumstances.
I could quote many examples of these peculiar systems of payment which have grown up in various sections of industry to suit the circumstances of certain jobs. I will give two more examples in the steel industry in Scotland where there is an agreement for an extended working week, that is a 21 shift week. When this number of shifts has been worked in the furnaces, the maintenance men, again by agreement, have to accept Sunday as a working shift. They have agreed that they will work on Sundays. This becomes part of the normal working week, but if they work on Sunday they are paid overtime.
§ Mr. Robertson
No, not necessarily the cycle. This has to do with continuous working of the furnaces or the mills. Employers ask that maintenance men should be present during days which are not working days. An agreement has been drawn up that these men shall attend on those days and therefore the Sunday is a normal working day.
In the steel industry in Scotland there are premiums for certain days of the years, called "holiday premiums". These are days on which men are not entitled to go on holiday, but if they work, as they always do, they are paid premiums for so doing. These can be called overtime payments. It might be 1124 no stretch of the imagination so to call them and, knowing the steelworks negotiators on the management side, I do not think that it would take them long to come to this point and so describe them. These payments are part of normal remuneration for a maintenance man in the industry. If it came to reckoning payment given to a man under notice these should be considered.
I understand what the Minister and the Parliamentary Secretary have been trying to do in the new Schedule. Parts of the Schedule are less attractive than the original proposals, where average earnings were suggested as a basis. I accept that what the Minister is attempting to do might be less complicated and less difficult to understand and might create fewer problems. I am all for simplicity in these matters, but not to the extent of reducing the liability of the employer to the normal minimum hourly rate of wages and the normal minimum hours of the working week. I think that these provisions should go a little further than that.
I hope that I have been able to convince the Parliamentary Secretary. This problem is not simple. Even if the hon. Gentleman imagines that this part of the Schedule deals with the majority of cases—and it seems to me that what I am about to say is something of a boomerang—nevertheless, there are instances where there would be an obvious injustice. I believe that the position would be met if the words of the Amendment were accepted. This would mean that when men were regularly employed on overtime, or in circumstances where overtime payments were made for working a normal week, these payments would be taken into consideration in calculating the employer's liability during the period of notice.
§ Sir S. Summers
Naturally, I am delighted that the Minister has found it possible to include in the new Schedule the principle which was advanced in Committee, namely, that in calculating payments to be made to men under notice—where it was possible to pay them for the work which they were in fact doing—that should be the method of calculation, and that only where that was not possible should a different treatment be allowed.
1125 Generally, I would think that the new Schedule meets the case. It is certainly a great deal more satisfactory than the wording in the original Bill. I tried to follow the detailed comments of the hon. Member for Paisley (Mr. J. Robertson) on the wording of that part of the Schedule which is headed "Preliminary". It is always difficult to make sure that one understands what a Parliamentary draftsman means by what he writes down, and I am not at all sure that the hon. Member put an interpretation on these words which would stand up to examination. I mention this in the hope that before the Bill becomes law the Minister will make sure that the proper wording is applied in these several cases.
I assume that in dealing with this matter of overtime there are two types of overtime of which account must be taken. There is, for instance, the money which is paid for Sunday work as part of a normal number of hours in which Sunday plays a regular part. These ought to be included in the calculation with which we are dealing. If, however, a fitter, for example, worked five hours more than the normal number of hours that appertained to fitting work this should not fall into the same method of calculation, in my judgment, as the kind of overtime payment which was alluded to as part of continuous working, or as the continental week. The Amendment which is designed to give effect to the first type of calculation might well bring into account the second type of calculation also which should not have a place there. Just because for many months in the year that fitter is able to earn for five or even ten hours a week on top of the forty-two, it does not follow that he should be entitled to a similar number of hours during his period of notice if it happens that he is not working those hours. That is quite a different case.
§ Mr. J. Robertson
While I appreciate the hon. Gentleman's argument, may I ask him whether he will agree that it would be wrong for an employer to work a man the normal hours during the period of notice if the rest of the factory were working overtime? How would he deal with that situation?
§ Sir S. Summers
Evidently the hon. Gentleman's views are coloured by his experience. I do not know of an 1126 employer who would single out a man and deprive him of the overtime which he was prepared to grant to others not under notice. This seems to me an utterly extreme case for which it is practically impossible to cater in a Bill of this kind. I think we should content ourselves with trying to make plain what we mean in terms of overtime in this context. If the regular week-in, week-out cycle entails payment for an exceptional number of hours at the weekend, that should be in the calculation, but if the overtime springs from more than normal hours it should not.
These are detailed points which may or may not have been taken into account by the draftsmen, and I think it may be of interest to distinguish between the two types of overtime which, to my mind, are relevant in this context.
§ Mr. A. J. Irvine
The Parliamentary Secretary will have a considerable number of not easy points to deal with on this proposed new Schedule. I do not intend to deal with the points so far raised, although I fully realise their interest and significance. There is no doubt that this is a complicated Schedule and that it is alive with points of difficulty.
I feel concern at paragraph 5 of the Schedule dealing with notice given before a strike. We have on the Notice Paper an Amendment seeking to delete that paragraph from the Schedule. As I understand it, the effect of the paragraph is—and I shall be only too glad if this is disavowed—that where an employee has been concerned or taken part in a strike at any time, then for all future periods he is without entitlement to the benefit of payment during the period of notice. I should like to know whether that interpretation is correct. I think that the words are capable of carrying that meaning, and it would seem to be a very extraordinary result. After all, this paragraph does not seek to draw any distinction between unofficial strikes and official strikes. It covers all cases of strike action in the course of an industrial dispute.
I think that the matter is sufficiently important for me to read out the paragraph:No payment shall be due under this Schedule in consequence of a notice to terminate a contract given by an employee 1127 if, on or before the termination of the contract, the employee takes part in a strike of employees of the employer.As I say, I may be wrong in my interpretation of those words, and if so I should like to be told, but my reading of that paragraph is that if an employee takes part in a strike at any time he thereby becomes disqualified to the entitlement of benefit at any particular rate during the period of notice. I should have thought that would be a consequence of the language.
In our earlier consideration of this aspect of the Bill we have sought to eliminate from it any reference to strikes. We thought it right so to do. The question of time expended upon strikes and loss during strikes becomes relevant in the calculation of the period of continuous employment under the First Schedule. It also becomes relevant in this paragraph to the Schedule which I am now discussing. We took the view that it was undesirable that this Bill should be encumbered at any point by references to strikes relative to entitlement to the benefit of payment during period of notice.
I would be the first to acknowledge that, if that were done, it would involve a lacuna in the Bill. If we have a provision in the law that a worker during the period of notice is to be entitled to payment at a given rate, and that that entitlement is to depend upon the length of employment that he has had with an employer, and if the amount that he is to be paid during the period of notice has any relation to his average remuneration, it will obviously be necessary for somebody somewhere to take account of what is to be the effect of a period of time spent in a strike. But that is no conclusive reason for seeking to incorporate the treatment of this problem in the Bill because that is a matter capable of negotiation.
§ Sir S. Summers
Is the hon. and learned Gentleman distinguishing between a strike which is in keeping with a man's contract and a strike which is a breach of his contract?
§ Mr. Irvine
I am referring to all strikes. I am acknowledging that it would be a lacuna if this matter were not dealt with in the Bill, but I am arguing 1128 that it is much better than the attempt to deal with it such as we have here.
§ Sir William Taylor (Bradford, North)
Would the hon. and learned Gentleman say what is a lacuna? I have never heard of the word.
§ Mr. Irvine
It is a gap.
That is the view that we have taken in the course of our consideration of the Bill. Paragraph 5 of this proposed new Schedule runs entirely counter to the view that we have taken. I think this is a matter of very great importance because, unless I am mistaken, it is wholly novel and exceptional to make provision in a Bill, as this Bill seems to provide, that because employees have been on strike their entitlement to benefit—and in this case the right to be paid at a certain rate during the period of notice—should be diminished or extinguished. This is an important matter of principle and there is a great danger attached both to this provision and to the manner in which it has been brought forward.
At a time when hon. Members on both sides of the House may deplore the incidence of unofficial strikes, so-called wildcat strikes, and so on, it is, of course, tempting to take a casual view about an attempt to gnaw away very hard-won rights of trade unionists and workers acquired in the long history of industrial relations. Yet I believe that, unless we are vigilant, this is what may be happening now. I know of no precedent which has the effect that the taking of strike action will, as a consequence, lead to a loss of benefit of this character. Moreover, the loss of compensation during a period of notice may have no kind of logical connection with the issue which arose in the strike.
I believe that this may be the thin end of the wedge of a very undesirable process, and I am not at all sure that this is not the aspect of the Bill which hon. Members opposite most like. Although I have acknowledged what merit there is in the Bill, I think it just possible that the thin end of this wedge is what makes it attractive to more hon. Members opposite than I care to think.
§ Sir S. Summers
The hon. and learned Gentleman is misleading the House completely on this matter. The comments he is making are relevant only in the case of strikes in breach of contract. 1129 There are no benefits lost if workers strike other than in breach of contract, and, in fairness to those who may read these debates, the hon. and learned Gentleman ought to distinguish between the two.
§ Mr. Irvine
I am obliged for that intervention because it is important that we should be clear and accurate about it. A strike is defined—there is a reference back to it in the new Schedule—at the end of Schedule 1. I am open to correction, but I do not see a provision in that definition of a strike which confines it to strikes in breach of contract.
§ Sir S. Summers
It is on or before the termination of the contract. If someone wishes to strike, he terminates his contract and then withdraws his labour.
§ Mr. Irvine
I am sure that it would not be desirable that the hon. Gentleman and I should get involved in a matter of interpretation, and I think that we should both be grateful to the Parliamentary Secretary if he would clear the matter up. I can only say, without the least desire to give anything other than an absolutely frank view of the matter, that, at best, it is open to doubt.
§ Mr. Irvine
I should be very surprised if the hon. Member for Aylesbury (Sir S. Summers), upon a study of the language at the end of Schedule I, felt satisfied in his own mind that all strikes were not comprised in that definition.
The view I take, on my interpretation, is that we are here confronted by something novel and exceptional, namely, a provision in a Bill which says that men who have been engaged in a strike, no matter whether official or unofficial, shall therefore be disadvantaged in respect of payments they are entitled to receive during periods of notice even though the termination of their employment has nothing whatever to do with the matters which arose during the strike.
I am anxious about these questions, and I believe them to be matters of very great importance for the House to consider. It is true that they were dealt with in Committee and we divided upon them. It may well be that the circum- 1130 stance that we are free to consider the issue again is a consequence of it being recognised to be very important. But let the House know what it is about. Here it is rather hidden away in a new Schedule. It may be of great significance.
§ Mr. Prentice
We on this side of the House are grateful to the Parliamentary Secretary and the Government for looking at some of the points we raised in Committee. In many ways, the Schedule which we have now is an improvement from our point of view, on those parts of Clause 2 which it replaces. In particular we are glad that subsection (4) of the old Clause 2 has gone, that is, the subsection enabling an employer to set off to some extent severance payments against his obligations under the Bill. We took exception to that and we are glad that our point has been met.
Inevitably, when we are faced, at fairly short notice, with a schedule of this complexity, we are bound to have questions to ask. My hon. Friend the Member for Paisley (Mr. J. Robertson) and my hon. and learned Friend the Member for Liverpool, Edge Hill (Mr. A. J. Irvine) have given the Parliamentary Secretary quite a lot to reply to, and I do not particularly wish to add to his difficulties, but I have two new points to raise and I wish to comment on what my hon. Friends have said.
The first new point arises out of paragraph 2(5) of the new Schedule where it is provided that the payment of holiday pay, among other things, may go towards meeting the employer's liability under the paragraph. This bothers us to some extent. We quite see that, if an employee has a holiday due and takes it as part of the period of notice, he clearly should not be paid twice for that holiday. But there are circucumstances in which a man accumulates an entitlement to a holiday and then, if he ends his work with the employer, gets a payment in lieu of the holiday. In some industrial agreements there is reference to holiday credits; a man acquires certain holiday credits by so many months of work and then, if he leaves the job without taking the holiday, he is entitled to that number of days' pay. Clearly, he should be entitled to that in addition to the payment he is entitled to for the period in which he is working his notice. I hope that the meaning and intention of this 1131 paragraph would entitle him to that holiday pay in addition to his other rights under the Schedule. If not, it should be changed. We should welcome the hon. Gentleman's view about it.
The other fresh point arises on paragraph 4 of the new Schedule which refers to the employer not being liable to payment for any period during which the employee is absent from work with the leave of the employer granted at the request of the employee. In Committee, many of us were concerned that a man who had been given notice should have reasonable time off to go and look for a new job. I do not say that this wording in any way inhibits him from having time, and I am sure that it is not intended to do that. However, we should have been happier if some reference to reasonable time had been made in the wording of the Schedule. There are drafting difficulties here, as we heard in Committee, but it might, I suggest, be useful to repeat the point now and have the Parliamentary Secretary's view about it.
If a man is told that his present job is no longer open to him and he will lose it within a week or two, the most important thing to him—far more important that anything in the Bill—is to be able to get another job. We do not want in any way to inhibit his right to go and seek another job, and we feel that it would be useful if there were a reference to his right to reasonable time off. I think that the Government promised us in Committee to consider this point, but they have not met it and we should like further comment about it. Perhaps it is a matter which could be considered between now and the time when the Bill reaches another place.
We attach very great importance to the points raised by my two hon. Friends. First, I make a brief reference to the question of overtime. I shall not go over the ground covered by my hon. Friend the Member for Paisley with great skill and out of his considerable experience in industry, but it seems to us that, whereas we welcome the more simple wording of the Schedule compared with Clause 2—we are all for simplicity when we can have it—the very simplicity at which the Government have aimed may lead to difficulty in cases where, for instance, a man is doing shifts which cover weekends giving rise to extra payment and the 1132 sort of problems to which my hon. Friend referred.
The hon. Member for Aylesbury (Sir S. Summers) rightly said that there are two kinds of overtime involved here. It is our view that both kinds of overtime should be taken into account in working out the pay in the period of notice. My hon. Friend rightly concentrated on one kind, the kind of extra payment which a man gets for working perhaps at weekends or other irregular periods. Clearly, we want the wording to cover payment for that type of man.
If a man has been getting regular overtime in the sense of working extra hours over a period of months prior to his notice, we do not see why that should not be reflected in the pay which he gets during the period of notice. In that respect, the Schedule appears to be less favourable to the man than the original wording of Clause 2. We would like to know from the Government whether that was their intention. We have put down an Amendment which we can, if necessary, press to a Division, as we shall be inclined to do unless we get clarification which meets our point.
As to strikes, which are referred to in paragraph 5 of the Schedule, I hope that the Parliamentary Secretary will be able to meet some of the points made by my hon. and learned Friend the Member for Edge Hill. We do not like any reference to strikes in the Bill. It is the wrong place to introduce any kind of legislation affecting strikes. In a way, the Government have the worst of both worlds. Many of their hon. Friends would like the Bill to include certain definite anti-strike Clauses. Some hon. Members opposite who spoke on the first new Clause today spoke on those lines. The Government, rightly in our view, have not met their hon. Friends on that point. At the same time, they have included certain references which meet neither the views of their hon. Friends nor our view.
§ Mr. Kenneth Lewis (Rutland and Stamford)
Would the hon. Member not agree that it is almost inevitable that the question of strikes had to be raised, since if a strike occurs there is a break in continuity of employment? Since other reasons are listed for the breaking of 1133 continuity of employment, it was necessary to raise the question of strikes and decide what to do about it.
§ Mr. Prentice
I am not convinced about that. Even if it were so, the wording of the Schedule goes too far.
In Committee we discussed the kind of situation that could be defined as a strike. It could be a walking-off the job for half an hour. It could be a reaction by men to a situation which they find intolerable and which all of us individually would agree was intolerable. There could be a situation in which men are ordered to work in conditions which they believe to be unsafe and against which they protest and will not work until they get certain guarantees. In that kind of situation, looking at its merits, possibly none of us would want in any way to penalise the men or to affect their rights under the Bill.
The difficulty about the wording, as in the case of the First Schedule, to which we object, is that it prejudges all the situations, no matter how they arise or whether the strike is prolonged or short. It is automatically assumed that the men have broken their contract in a way which means they should be deprived of their rights under the Bill. This is far too sweeping and the wrong way to approach these matters. It will not have any effect on the incidence of strikes, because if people are prepared to strike they will not be discouraged by the minor losses which they will sustain under the Bill. In any event, it would be unfair. Therefore, we prefer this part to be taken out. I know that the Government will not meet us on this point, but at least we hope that the Parliamentary Secretary might meet us on the other points made by my hon. and learned Friend.
§ Mr. Whitelaw
I do not need to be reminded by the hon. Member for Paisley (Mr. J. Robertson) that this is a complex provision. Anyone set to reply to the various points which have been put to me in the last quarter of an hour would be only too acutely aware of that. I thank my hon. Friend the Member for Aylesbury (Sir S. Summers) for his welcome of our proposals. I am glad that we have been able to go some way—I hope, a long way—towards meeting his Amendment.
In reply, first, to the several short points raised by my hon. Friend in an inter- 1134 jection, sickness and injury are dealt with in paragraph 2(1) of the new Schedule for workers with normal working hours. For workers with no normal working hours, the relevant provision is paragraph 3(5). I hope that this will help my hon. Friend.
We had a valuable contribution from the hon. Member for Paisley. We all accept that seeing a Schedule of this complexity at short notice and making so many important points upon it is extremely difficult. I will do my best to reply as far as I can to the points raised by the hon. Member. If I do not successfully answer all of them, we would, naturally, like to read in HANSARD what he has said and to consider carefully before the next stage of the Bill any points of difficulty which he has raised.
I start by dealing with the hon. Member's point about defining normal working hours. There is, of course, no definition, but paragraph 1(1) of the Schedule gives guidance. It provides that wherever there is overtime pay, when the employee works more than a fixed number of hours, that fixed number of hours is to be regarded as the normal working hours. This will settle the question for practically all industrial workers and also for many workers in shops and offices. I emphasise that this provision does not say that if there is no overtime pay, there cannot be normal working hours. It would clearly be wrong to do so, because there are a fair number of employees in offices for whom it is part of their conditions to work beyond their usual hours at times of heavy pressure without expecting extra pay.
The hon. Member made an important point about people who may have extra hours of overtime. The Amendment which the hon. Member and his hon. Friends have tabled would have the effect that under paragraph 1(1) of the Schedule, normal working hours would include not only the fixed hours beyond which there is overtime pay, but also an estimated average of hours of overtime.
There is no doubt that the hon. Member has made a valid point. Some employees, of whom transport workers may be a good example, are liable to earn a considerable amount of extra pay through overtime and night work. An employee in this position would have his earnings reduced if during notice he 1135 worked only his normal working hours, all on the day shift. Another example might occur in a factory which was reducing production and cut out the night shift. A worker under notice who had previously been on the night shift might have to work out his notice on the day shift and his earnings would be reduced in consequence.
I should stress that in what will surely be the normal cases, there will be no reduction of earnings in that way. The hon. Member for Paisley fairly agreed with this. It must be right to assume that in most cases people will continue to do the same amount of work at the same sort of hours during notice as they were doing before notice and that their earnings will not, therefore, suffer.
It must, however, be recognised that the earnings of some employees may fall during notice. It is true also that in some employments, employees depend more on overtime earnings than do employees generally. For them, the guarantee in the new Schedule, I say frankly, is less complete. We must accept it as inevitable that any rules for minimum pay that any of us could devise would work unevenly in some cases. What we must surely consider is whether the Bill will prevent pay during notice from falling below a reasonable level. The guarantee which we propose will prevent pay from falling below the contractual rate for a normal week's work. I regard this as a reasonable minimum. It is considerably higher than the level set by the great majority of guaranteed wage agreements.
Having said that, having accepted that there is a real difficulty here, and having also said that we will certainly consider if we can meet in any way the problem which the hon. Gentleman has put forward, I must, I think, point out that there is great difficulty in the first Amendment put down to the new Schedule. It would bring that same procedure into play in those cases, on the one hand where work at the enhanced rates had become a regular, accepted feature of the job, and on the other hand, those where it was exceptional and perhaps optional, and, as my hon. Friend the Member for Aylesbury pointed out, there is no case for this being reflected in a man's pay during notice.
1136 I fancy that from his long experience the hon. Gentleman the Member for Paisley would be the first to accept that there would be room for endless dispute and argument in trying to estimate the average hours of overtime. Constantly in the Committee he and other hon. Gentlemen chided my right hon. Friend and me with the thought that we had not realised the difficulties of the working conditions in a factory and that some of our proposals were too theoretical. I think I must, with all possible respect, throw this back at him, as far as estimated hours of overtime are concerned. Nevertheless, having said that, of course we will consider very carefully the point he has put forward.
Perhaps I should add to the hon. Gentleman the Member for Southwark (Mr. Gunter) that we consider it should be done in this particular way. I am sorry, but I hope that will carry the point.
Perhaps I may now turn to what the hon. Member for East Ham, North (Mr. Prentice) said about holiday pay. Paragraph 2(5) of the new Schedule refers only to holiday pay in respect of the relevant period. It does not cover accumulated holiday pay for the whole year.
I turn to the next point which the hon. Gentleman made referring to the other Amendment put down about time off work. I must say quite frankly to the House that we agreed to consider this after the Committee, to see if there was any way in which we could meet the extremely desirable objective, the objective which was accepted, indeed, on both sides. We really have found it impossible to find a form of words which is flexible enough to be practical and which is at the same time capable of being enforced without giving rise to uncertainty and dispute. The hon. Member for Glasgow, Govan (Mr. Rankin) said that of course such a form of words must exist, but he was careful to say that he would not dream of trying to produce it. I really must tell the House that I doubt whether such a form of words does in fact exist, and if that be the case, however desirable our objective, it really is extremely difficult to carry it out.
1137 Now I should like to turn to the last point raised by the hon. and learned Gentleman the Member for Liverpool, Edge Hill (Mr. A. J. Irvine) and also the hon. Member for East Ham, North, about paragraph 5. I would say straight away that we will look at the point put forward by the hon. and learned Member for Edge Hill. It is certainly not our intention that the paragraph should be interpreted in the way he thought it might be, and if there is any danger of that, of course we shall seek to meet him on it.
I now turn to the rather broader point which he made, and which was also made by the hon. Member for East Ham, North, the Amendment to delete paragraph 5. It is, of course, linked with the wider issues raised by the strike provisions in the First Schedule. As the hon. Member for East Ham, North said, we discussed this fully in Committee. I naturally appreciate what has been said. I think we made it abundantly clear in Committee that this Bill is not intended to be an anti-strike Measure, and I hope I have said this so often that the hon. and learned Member for Edge Hill can certainly acquit me and, I know, my right hon. Friend, of any idea that this is in our minds. It has, as we know, two main purposes.
The reason for the strike provisions in the Bill is, of course, that we have to deal with the difficult question of the effect a strike would have on the employee's period of continuous employment or, in this case, on the question of his minimum pay during notice. Really I must say to the hon. and learned Member for Edge Hill that we have not invented this problem, but at the same time we cannot ignore it. It is also of course important to solve it, and in a way which would encourage responsibility and good sense. I really do believe that the present strike provisions in the Bill as they stand do that.
The hon. and learned Gentleman referred to another provision in the First Schedule in the definition of "strike". That particular definition, as my hon. Friend the Member for Aylesbury pointed out, must be read in conjunction with paragraph 7 of the First Schedule which refers to somebody taking part in a strike which breaks the contract. If it is so read, then I think it disposes 1138 of some of the hon. and learned Member's arguments.
§ Mr. Irvine
I am obliged to the hon. Gentleman for his careful treatment of the point I raised, and particularly the point of interpretation dividing his hon. Friend the Member for Aylesbury (Sir S. Summers) and myself, but may I ask that consideration be given to this point, as he has promised it will be given to the other? There is a specific reference in the Second Schedule as it is now framed to the definition of "strike" in the First Schedule, but it is not a definition by itself, and the difficulty, everyone can agree, is that there is contained a qualification.
§ Mr. Whitelaw
I respond at once to the very proper point which has been put forward. but I think in general terms it does follow, if we have the present provisions as they are in the First Schedule, that the minimum pay rules should not be applied when a man gives notice that he is intending to go on strike. After all, the purpose of the rules is to safeguard the pay of the employee when having to change his job, not, I am sure the House would agree, when he is about to go on strike. I hope that the House will agree that paragraph 5 is useful and is necessary, and, provided it carries out what I have said it provides, and no more, that it would be better not to remove the paragraph.
I hope I have managed to reply to the large number of points on an extremely complex question. I am grateful for the welcome given to these provisions, and I hope that the House will pass the Amendment.
§ Mr. Ede (South Shields)
As one who was not a member of the Standing Committee on the Bill, I find it very difficult indeed to follow the argument we have been having on this Amendment. That is not because I am unappreciative of the speech which has been made by the Parliamentary Secretary, but I would have thought that, in a matter of this importance, in trying to draft a Measure to prevent unnecessary disputes from arising in industry we ought to have had the advantage of the presence of one of the Law Officers of the Crown to tell us what some of the words which have been bandied about from one side of the House to 1139 the other really mean, if they are to be in an Act of Parliament. The hon. Gentleman was quite frank when he was discussing the new Clause which was moved by the hon. Member for Crosby (Mr. Graham Page). He said he was no lawyer, but all the things we have heard about recently on this Amendment may quite easily become matters in leading cases in the law courts in the next few years. There may be some surprises, as is usual on such occasions, because of the interpretations given to some of what appear to be quite innocent words included in a Bill in an atmosphere of general good will such as is prevailing in the discussion of this Bill.
We are in a very advanced stage of the discussion of the Bill in this House. After this stage, the next is the Third Reading, and the Bill then goes elsewhere for consideration. I assume that some of the statements made by the Parliamentary Secretary mean that the Government are noting some of the problems raised in the present discussions and intend to deal with them when the Bill is considered in another place. But if nothing is done in another place, this is our last opportunity for discussing them.
The Government, who are well equipped with Law Officers, might have been able to provide one of them for this afternoon's discussion to tell us what in the eyes of the law some of the vague words which have been used and the phrases which have been built up actually mean in law. I am sure that we all wish the Bill well. It is an effort to forestall discussions which it might be difficult to hold in a similar atmosphere and which might lead to nasty accusations of bad faith from either side. I hope that before we part with this matter we shall have the advantage of hearing the views of the Law Officers.
I was very struck when at one stage my hon. Friend the Member for Nelson and Colne (Mr. Silverman) made a sotto voce interjection which was at once emphatically contradicted by the hon. Member for Aylesbury (Sir S. Summers), which indicated that there was considerable difference between two hon. Members who might both be regarded as knowledgeable in the matter.
§ Sir S. Summers
The right hon. Gentleman would not expect me usually to agree with the hon. Member for Nelson and Colne (Mr. S. Silverman)?
§ Mr. Ede
Oh, no. Two knowledgeable men can have very violent and deep-seated views on the same subject and yet differ completely. If that were not the case, there would be no employment for lawyers.
If we are not very careful, we may pass this Schedule in the hope that it will mean what each of us thinks it means, and we may then find, if it goes before the courts, that views which have not been expressed here today are held to be the exact meaning of the words which we put in the Bill. The Government themselves should have fortified the Parliamentary Secretary with one of the Law Officers to deal with these problems which he frankly admitted he could not discuss as a lawyer or about which give us a legal opinion. It is a great pity that we have not had an opportunity of getting the matter authoritatively dealt with.
§ Mr. Whitelaw
I accept that the right hon. Member for South Shields (Mr. Ede) feels that I am very inadequate and I am bound to accept his feelings on that. We had the Law Officers in Committee and they frequently came to give us the benefit of their advice. I note the right hon. Gentleman's criticism, but I think that I can give him what I hope he will feel to be a positive assurance.
First, the whole question of the new Schedule was very carefully vetted from the legal aspect, as he would be the first to appreciate from his very long experience. I can give him the positive assurance that points which have been brought forward today will certainly be discussed with the Law Officers and that when it come to consideration in another place, if there have been any doubts they will be cleared up. I understand what the right hon. Gentleman has said and I hope that my positive assurance will enable him to feel that the new Schedule is right and that we should pass it.
§ Mr. Ede
I am sorry that the hon. Gentleman should have thought that anything I said was an intimation that I regarded him as inadequate. In view of the complexities which have been raised, 1141 I think that he has shown himself exceedingly competent, because he has expressly denied any legal training and knowledge, and at that stage that is what we want. I hope that in another place some of the problems which have been too intricate for us this afternoon will be resolved.
§ Amendment agreed to.
§ Further Amendments made: In page 2, line 19, leave out "two years" and insert "twenty-six weeks".
In line 29, leave out from "employment" to end of line 25 and insert:
the provisions of Schedule (Rights of employee in period of notice) to this Act shall have effect as respects the liability of the employer for the period of notice required by section 1(2) of this Act".
In line 26, leave out from "apply" to end of line 31 and insert:
in relation to a notice given by the employer or the employee if the notice to be given by the employer to terminate the contract must be at least one week more than the notice required by section 1(1) of this Act".
§ In line 32, leave out subsection (4).—[Mr. Whitelaw.]
§ Mr. Whitelaw
I beg to move, in page 2, line 37, to leave out from "void" to the end of line 39.
This Amendment proposes the deletion of the second half of subsection (5). The effect is that the minimum guaranteed by Clause 2 and the new Schedule will invariably apply to all contracts covered by Clause 2. Under subsection (5) as it stands, the guarantee would not apply to a contract giving the employee rights on the whole equivalent to or better than those given by Clause 2.
This provision was very desirable with Clause 2(1) in its original form, but the reasons for having it are much diminished under the new minimum pay rules, because they stick very much more closely to the contract. Since, therefore, the provision is necessarily rather imprecise and perhaps on that account liable to lead to dispute, I think that it is better to drop it.
It will also be remembered that during the Committee stage we had a little bit of—I do not know whether "fun" is the right word—discussion about the wordson the whole equivalent to".1142 They are now disappearing and I do not think that anybody will be very sorry for them. But the first half of subsection (5) remains necessary. Without it, the rights in Clause 2 might be overridden by a term in a contract which said that the parties agreed that rights under Clause 2 could be waived. I think that this is a sensible Amendment. It follows from the change of Clause 2 and the new Schedule, and I hope that the House will agree to it.
§ Amendment agreed to.
§ Further Amendment made: In page 2, line 40, leave out subsection (6).—[Mr. Whitelaw.]