HC Deb 28 April 1975 vol 891 cc33-169

Order for Second Reading read.

3.34 p.m.

The Minister of State, Department of Employment (Mr. Albert Booth)

I beg to move, That the Bill be now read a Second time.

My right hon. Friend the Secretary of State has asked me to convey his apology for his absence from the debate today. Having personal knowledge of the great extent to which the Bill is the result of his efforts and his commitment, I deeply regret that he is in a hospital bed instead of at the Dispatch Box.

The Employment Protection Bill is the second stage of the Government's programme of industrial relations legislation. The first stage was the Trade Union and Labour Relations Act and the Trade Union and Labour Relations (Amendment) Bill repealing the controversial features of the 1971 Industrial Relations Act. This we intend to follow with an industrial democracy measure that will make a logical extension in this field.

The two main themes of the Employment Protection Bill are the strengthening of collective bargaining and the establishment of new rights for individual employees, especially in regard to job security. Before describing the individual provisions, I want to comment briefly on these themes.

The collective bargaining theme is reflected in many of the Bill's provisions, notably those dealing with trade union recognition, disclosure of information and the reform of wages councils. Equally if not more important is the establishment of the independent Advisory, Conciliation and Arbitration Service on a statutory basis. Within the area of individual rights the Bill introduces provisions that include guarantee payments, remuneration on suspension on medical grounds, maternity pay, the right to return to work after maternity leave, and time off for public duties.

These individual rights are attacked on grounds of added cost to industry at a time when it can least afford it and, in the terms of the Liberal amendment, as taking no account of the problems of small firms and small businesses. I am ready to concede to hon. Members opposite that that may be part of the case contained in the amendment tabled by the right hon. Lady the Leader of the Opposition and her hon. Friends.

The cost argument can be and has been exaggerated. Many items in the Bill involve little or no extra cost for employers. Changes proposed in the law on unfair dismissal will affect only a minority of employers who fail to maintain generally accepted standards of reasonable behaviour towards their employees. Most of the extra cost will result from the guarantee payments and maternity provisions.

If all the provisions of the Bill had been in force last year, we estimate that the extra annual cost to employers would have been about £100 million to £120 million. This is approximately equivalent to £5 a head or lop a week for employees. Of that about 8p would be accounted for by the guarantee payments.

This clearly does not fall evenly on all employers. Those with no lay-offs or short time are not affected at all by the guarantee payments. In many industries where there are lay-offs and where short-time working occurs there are already voluntary schemes that are better than the modest proposals in the Bill. Where these operate, there is no need to fear additional costs being imposed as a result of the Bill.

It is said that the Bill will bear heavily on small firms and businesses. I must make it clear that I do not in any way underestimate the problems of small firms and businesses, but I think that those problems must be tackled in other ways.

Mr. Cyril Smith (Rochdale)

Merely to get the record straight: I should be grateful if the hon. Gentleman would tell me which part of the Liberal amendment refers to the pressure on small businesses. I have read it three times since this morning and I cannot find it mentioned anywhere.

Mr. Booth

I am very sorry and I apologise deeply to the hon. Member. I have accused him of words that are in the Conservative amendment, not in his. That is a terrible thing to do to any man and he has my unreserved apology. Now that I have been very properly corrected, I can address myself to the correct quarter.

There is a serious problem for small firms and businesses, but it must be tackled in other ways. I cannot believe that it is right to give the employees of small firms lower standards of statutory protection of conditions than those in large firms. It would be wrong on the grounds of equity and appreciation of the important räle that small firms have in our economy to make their employees second-class citizens for the purpose of employment protection.

Mr. David Mitchell (Basingstoke)

Can the Minister tell the House whether he accepts that there are serious problems for small firms and that they must be dealt with? Can he say when the Government intend to deal with those problems and when will such a programme be announced?

Mr. Booth

The Government are giving serious consideration to the problem of small businesses. My hon. Friend the Under-Secretary will be saying something about this when he replies to the debate.

Dealing with those points in the Bill which strengthen collective bargaining, I note the reference in the amendment tabled by the Conservative Opposition to making no attempt to establish a fair balance between … management and unions". What the Bill does is propose changes in the law to make it appropriate to the good management—trade union relationships that have been developed within the United Kingdom. Good management does not refuse information for negotiation. It does not fail to consult on mass redundancy. It does not refuse to recognise trade unions or seek to discriminate against employees on grounds of membership of an independent trade union.

These are not the practices of good management in its relationships with trade unions. There is no requirement which can sensibly be laid upon us to say that we must, because these things are being required by law, deny trade unions something of their power in relation to management.

The Bill is proposing to change our law from legal support for management by managerial prerogative to legal support for management by consultation. It requires management to inform, consult and in some cases to negotiate. It does not create a legal obligation on management to agree, nor does it prescribe the outcome of those consultations and negotiations.

Part I of the Bill establishes the Advisory, Conciliation and Arbitration Service on a statutory basis and defines its functions. It charges the service with the duty of promoting the improvement of industrial relations, encouraging the extension of collective bargaining machinery and, where necessary, the reform of such machinery. The service has a key räle to play in promoting the peaceful settlement of disputes by conciliation or by securing agreements to refer disputes to arbitration. Since the service started last September it has made good progress under the direction of Jim Mortimer and has gained the confidence of unions and management.

In the first six months of its existence the service dealt with 50 per cent. more requests for conciliation than did the Department of Employment in the previous six months. The number of cases dealt with by arbitration in the same period increased by 100 per cent. This leads us to have confidence in this service and its ability to undertake the wider responsibility and greater räle which the Bill prescribes for it.

Clause 10 and Schedule I provide for the establishment of a Central Arbitration Committee with an independent chairman and members drawn from the trade unions and employers' associations. It is to this body that a trade union may ultimately go to obtain a right to recognition if this cannot be resolved by negotiation or conciliation. This part of the Bill is intended to deal with the problem of the employer who refuses to recognise any union or, as is more common, the employer who recognises manual but not staff trade unions. Here I ought to declare an interest since I am a sponsored member of the technical and supervisory section of the AUEW. Although I have not discussed this with it, my union may well seek to use this provision.

This part of the Bill has another function which has not been generally appreciated. Recognition issues for the purpose of the Bill cover questions of the area of negotiation. Under these provisions the issue of whether a union which can negotiate wages and hours should be able to negotiate on other matters such as pensions or training can also be determined. It also raises within its provisions the possibility that a union which already has a negotiating agreement and is recognised for certain grades of workers may seek through this vehicle to extend that negotiating right to cover other grades of workers. Part I of the Bill also requires employers to disclose to recognised unions the information they need for collective bargaining.

Part II covers new rights for individual employees. These include the guaranteed payments, intended to ensure that workers laid off because of shortage of work will receive certain income from their employer for a limited time. Initially it is proposed that the guaranteed payment should be a daily payment calculated from the employee's weekly pay as defined in Schedule 3. This is limited to a maximum of £6 a day and to five days in any calendar quarter. The limits can be raised by order subject to the affirmative procedure in both Houses.

Under Clause 76 the Secretary of State is under an obligation to review these limits, and it may well be that what we are now considering will lead to a series of debates on affirmative orders in future years with this House having control of what are the minimum protections for people laid off or who start short-time working in industry. I must make it clear that this guarantee does not extend to those laid off as a result of a dispute occurring within the area of their employment or a dispute within the premises of their employer.

The maternity provisions in Clauses 38 to 46 contain important benefits for women who leave their job on account of pregnancy and wish to return to work after childbirth. They will be entitled to six weeks' paid maternity leave if they work continuously for two years for an employer. A woman would also have the right to return to work in the occupation in which she was previously employed.

Mr. A. P. Costain (Folkestone and Hythe)

Does the Minister not appreciate that, while this has much to commend it, those firms which employ only a small number of women will have the greatest difficulty in keeping a job open for a woman who has left to have a baby? Further, what is to become of those people who are recruited temporarily to fill the vacancy? What will their position be? Will it not be unfair to them?

Mr. Booth

We appreciate that there are certain difficulties not only for small firms but for large firms, too, which may be required to give maternity leave to women carrying out a highly specialised job which no one else can perform. We do not think that such difficulties are confined to the small firm. We recognise that an employer must be protected against an unfair dismissal claim by someone whom he has employed on a temporary basis to fill the job of a woman on maternity leave. That is covered by the Bill.

We also recognise that in some cases it will not be possible for employers to give exactly the same job back but rather a job in the same occupation. There are many problems attached to this. We do not deny that. We expect to debate them at length in Committee. What we are anxious to establish at this stage is that there should be, as a fundamental right of working women, the ability to take maternity leave and return to work afterwards.

Mr. Robin Corbett

(Hemel Hempstead): Will my hon. Friend confirm that in the small number of firms which currently have provisions either for full or for part paid maternity leave the problems to which the hon. Member refers have been overcome in practice?

Mr. Booth

I can confirm that employers voluntarily operating such schemes who have discussed their problems with me have not raised this point. They have raised other problems. None of them has suggested that the problems they have faced have been such that they would wish to return to the earlier situation.

Mr. David Mitchell

Can the Minister confirm that there is no minimum size laid down in this instance and that this will apply to a Member of Parliament and his secretary? Can he explain how that will work?

Mr. Booth

To the best of of my understanding we do not define minimum sizes of employer or the size of staff for the purpose of this part of the Bill. In order to establish the right of reinstatement a woman normally will have to notify her employer before she starts her maternity leave if it is her intention to return, and normally it will not be possible for maternity leave payment to start more than 11 weeks before confinement. Those are some of the conditions which attach to it.

I want to refer to the proposals about insolvency in the Bill. These are designed to give protection to employees of firms which go bankrupt. In recent years about 30,000 to 40,000 employees a year have been affected by this problem. The Bill makes it possible for arrears of wages, holiday pay and pension fund contributions to be met from an extended redundancy payments fund. These claims will be met to a limit of £80 a week. We hope that as a result of these provisions those faced with the problem of working for a firm which goes bankrupt will be able to obtain prompter payment and will suffer less financial hardship in a way which will not damage the position of other creditors of the company.

Part II of the Bill establishes many other rights, including protection against victimisation for trade union membership or activity, time off for trade union duties and certain types of public duty, and guaranteed payments for employees who are suspended from their normal occupation on medical grounds under a statutory requirement and for whom no alternative work is available.

The improvements proposed in the unfair dismissal provisions of the Trade Union and Labour Relations Act are mainly to facilitate reinstatement or re-engagement rather than financial compensation for dismissal. The Government are particularly concerned about cases in which employees are dismissed for trade union membership or activity, especially because such dismissals are more likely to give rise to industrial dis putes than most other reasons for dismissal.

The 1971 Act put such dismissals in a special category in that they were to be treated as automatically unfair. We propose to strengthen that protection. Suitable amendments will be introduced in Committee so that an employee who considers that he has been dismissed or given notice of dismissal on account of trade union membership or activities, whether or not that is the reason given by the employer, may apply, with the support of his trade union, for a preliminary hearing by an industrial tribunal. If the tribunal is satisfied that the employee has a strong case, it will be able to give a ruling that he should be suspended on full pay. His contract of employment will then continue until his complaint of unfair dismissal has been resolved by conciliation or by a full tribunal hearing.

Sir Derek Walker-Smith (Hertfordshire, East)

I apologise to the hon. Gentleman for intervening because the question which I shall ask relates to Part I which, I appreciate, he has passed. My reason for asking it now is that I do not propose to trouble the House with a contribution to this debate because I hope to catch Mr. Speaker's eye in tomorrow's debate.

Is there any definition in the Bill of a trade dispute? There does not appear to be one in the interpretation clause, Clause 112, and there is no independent interpretation clause to Part I. The reason I ask is that several hon. Members, including myself, pressed the Secretary of State to refer the signalmen's dispute to the Advisory, Conciliation and Arbitration Service and he declined to do so on the ground that it was not an appropriate dispute for that purpose. Will the position be more general and wider under the Bill? I should be grateful for any information which the hon. Gentleman could give. If it is not convenient for him to answer now, perhaps the Under-Secretary of State will refer later to the point.

Mr. Booth

I am sure that the definition of a trade dispute is the same as that which we used in the Trade Union and Labour Relations Act. I think that there is a cross-reference from a schedule of this Bill to that Act. But I shall check on that and if I am incorrect in any way I shall write to the right hon. and learned Gentleman.

Part III contains provisions ***or the reform of wages councils, to widen their powers and stimulate progress towards voluntary collective bargaining in those areas of industry where statutory control of wages and conditions is still necessary. My hon. Friend the Under-Secretary of State will want to say more about this subject, but the levels established by wages councils certainly give me no confidence in reliance on this form of statutory protection as a means of solving the problem of low pay.

It is my hope that the special provision for wages council industries—Clause 88 and Schedule 10—will be extensively used by independent trade unions to raise the standards of their members in wages council industries. This provision will enable them to make a claim to ACAS if an employer is paying less than the minimum negotiated with other employers in similar circumstances.

Clause 88 and Schedule 10 also contain provisions about the extension of terms and conditions which form an important part of the Government's measures to help the low paid and to extend collective bargaining. These provide for claims to be made to ACAS where an employer has workers employed on terms and conditions less favourable than the general level observed by other employers in the same industry, in the same district, and whose circumstances are similar. This is in essence the same right that the fair wages resolution gives to employees on Government contracts.

Mr. Barney Hayhoe

(Brentford and Isleworth): Can the hon. Gentleman give the estimate made of the cost to industry of Schedule 10? He gave a global figure and broke it down a little. Will he give the breakdown for Clause 88 and Schedule 10?

Mr. Booth

No, I cannot give a breakdown, but I can tell the hon. Gentleman —I know of his deep interest in the matter—that we have discussed this provision with the CBI and the TUC with a view to finding out their ideas about its impact. I will break confidence by saying that we had very different estimates about what its effect would be. We have not been able to give a break- down because it would involve a large number of assumptions being made about interpretations which will be given by tribunals and about the degree of confidence of trade unions in seeking to use this as a means of raising the standards of their members.

Part V of the Bill—

Mr. Dudley Smith (Warwick and Leamington)

I am surprised that the hon. Gentleman has not mentioned, under Part IV, Clause 101, which transfers from local authorities to the Department of Employment the enforcement functions and licensing functions in the Employment Agencies Act. What is the reason for this? I understand that there has been no consultation on this matter with the local authority associations.

Mr. Booth

My hon. Friend the Under-Secretary of State wished to deal with that question, but we in the Department want to make this a centralised function because of other responsibilities which we believe will fall on the Government in relation to employment agencies.

On the aspects of the Bill which deal with the question of the handling of redundancies, the Bill requires employers to consult representatives of recognised trade unions about all redundancies and to provide them with all relevant information. Consultations must begin at least three months in advance of redundancies which involve 100 or more employees over a period of three months and at least two months in advance of redundancies which involve 10 or more workers over a period of one month.

Employers must also give similar periods of notice to the Secretary of State so that necessary plans for redeployment or retraining can be made by the Manpower Services Commission and its agencies. If there are special circumstances which make it impracticable for an employer to comply with the requirements, he has a duty to take whatever steps are reasonably practicable in the circumstances.

The Government attach the greatest importance to these provisions, particularly in the present circumstances, when redundancies are unfortunately all too common. They implement, and indeed, go well beyond, the recent EEC Directive on Collective Dismissals, in the shaping of which United Kingdom representatives played a full and constructive part during the discussions in Brussels.

Quite apart from our EEC obligations, we think it right and necessary to legislate on these lines. Advance consultation with the unions and advance notification to the Department are good employment practices and are already accepted as such by many employers. However, there are still some who apparently think it right to declare redundancies at very short notice or even with no notice at all, with little regard to the hardship and worry that this inevitably causes.

Now that the proposals have been published in the Bill, I hope that employers will not wait for them to become law but will put them into practice at once if the need arises. By doing so they will ensure that the problems of redundancy are fully explored in advance and dealt with in a sensible and humane way.

Before leaving the subject of redundancies. there is one other point to which I should refer. In the course of his Budget speech the Chancellor of the Exchequer mentioned that the Government propose to take powers to pay a temporary employment subsidy. The scheme would be used to alleviate some of the effects of high unemployment in the worst hit areas. We hope that in the event its use will prove unnecessary. It is, however desirable to provide for a short-term subsidy to be offered to a firm which is prepared to defer redundancies in order to provide an opportunity to initiate arrangements for retraining or for other possible action to facilitate employment.

The Government intend that the scheme should apply only in respect of workers who would otherwise be unemployed or who would displace other workers. It is therefore proposed to restrict the subsidy to development areas. Therefore, we shall bring forward in Committee a provision which will amend the Employment and Training Act 1973 so as to empower the Government to operate the scheme. Consultations are already in progress with the CBI and the TUC to work out the details.

I turn to Clause 99 which deals with people picketing. This is a declaratory provision. In other words, it does not alter the existing law as established by the House of Lords in the recent case of Broome v. Director of Public Prosecutions. It does, however, put it beyond doubt that the rights of pickets include the right to exercise persuasion on other people by peaceful means short of obstruction, as well as the right to attend for that purpose at any place other than a person's home. This clause makes no change in the position as regards the stopping of vehicles. That position is not entirely satisfactory, because whereas pickets usually have a reasonable opportunity to communicate with people who approach on foot, it is much more difficult. if not impossible, for them to do so in case of people in vehicles. Consequently the right of people picketing may be made ineffective in a way which can hardly have been foreseen when the law on picketing was first framed.

We have given a good deal of thought to the possible ways of dealing with the problem. There have been discussions both with the TUC and with the police organisations. However, it has not so far proved possible to find a solution which meets the legitimate needs of pickets without causing serious difficulties for the police. Clause 99 goes as far as the Government think is right at present, although we shall continue to study the problem and keep it under review.

Mr. Ian Percival (Southport)

The Minister has said that Clause 99 was designed to clarify the law. Can he tell us what it means? Can he give us an example of conduct which might be said to be in doubt now and which will be made clear by the Bill? I am blessed if I can. Can he give us an example of something each side of the line supposed to be drawn by these provisions?

Mr. Booth

I am certain that this is a matter which will be debated in Committee. My understanding is that the case to which I referred established quite clearly that there was the right to attend at a place for the purposes of picketing and peacefully communicating. What was thrown into doubt was the extent to which there was the right to carry out peaceful communication. I assure the hon. and learned Gentleman that the intention of the clause is to do no more than to make it absolutely clear that there is a right peacefully to communicate, short of obstruction. That is the aim of the clause.

Mr. Leslie Spriggs

(St. Helens): I am not asking my hon. Friend to interpret the law as he intends it to be when the Bill passes on to the Statute Book. However, I wonder whether the Bill will clarify the position of the farmers who caused an obstruction on the highways and the fishermen who obstructed the free passage of shipping into our ports.

Mr. Booth

I do not believe that the Bill will clarify the position in any way whatsoever. One may have views whether an attempt to stop a vehicle for two minutes can be regarded as an obstruction and whether holding up the entrance to a seaport for 24 hours may be similar action. As I understand the position, the Bill does not help us to solve that problem. We shall have to continue to examine the way in which we can reconcile our law on obstruction with the right to picket and peacefully to communicate.

I should like to draw the attention of the House to the position of staff employed in Parliament. Parliamentary staffs have not previously been covered by legislation of this kind. I am sure, however, that the House will agree that it would be indefensible if, in matters covered by this legislation, parliamentary staffs were in any less favourable a position than staff employed by a Government Department. We have been giving special consideration to their position, in consultation with the authorities of both Houses. I am able to give the House a firm assurance from the House authorities that they will ensure that, as far as is constitutionally possible, the staff here are treated similarly to civil servants in these matters. If it were the wish of the House that this undertaking should be embodied in a formal way, we would see how this might best be done.

When examining this problem I was deeply concerned to find that the 1812 House of Commons (Offices) Act still applies. That Act gives the Serjeant at Arms and the Clerk of the House power to dismiss staff without notice, with no redress or appeal. I am certain that it will not be the wish of any hon. Member of this House that that position should continue if it is within our power as legislators—as I am sure we shall find it to be—to deal with it.

Clause 100 tackles the problem of those denied unemployment benefit because of the grade, class and financing rules, when they are laid off due to a strike at their place of work. At present, if somebody is laid off as a result of a strike at his place of work, he has to prove that he is not participating in the strike, is not financing the strike, is not directly interested in the strike, and is not of the same grade or class as somebody who is participating, financing or directly interested. He has to prove all that in order to obtain unemployment benefit. This has resulted over the years in a growing number of cases in which great resentment is felt by people who are laid off, due to a strike, through no fault of their own, and are denied unemployment benefit. The abolition of the financing test and of the grade or class test was recommended by the Donovan Commission and has been the policy of the Labour Party for many years.

Many hon. Members will have examples from their own constituencies of many labourers who have been laid off and have received no benefit because one of their number had retained dual membership of a skilled union to retain benevolent fund rights and where it was held that because he was financing a strike, by paying trade union contributions, all others of the same grade or class —that is, all labourers—should also be denied unemployment benefit. We propose to remove these tests from our law, and I believe that by doing so we shall solve a long-standing problem, which has caused great resentment and a great sense of injustice.

Finally, I draw attention to Clause 113, which makes it possible for the protection afforded by the Bill to be extended by order in council to oil rigs and other offshore installations. I know that a number of hon. Members who are conversant with the conditions and the industrial relations position on oil rigs are anxious that this provision should be in the Bill.

Although the Bill is primarily concerned with employment protection, it has wider significance. It is the clearest possible evidence of the Government's firm commitment to the social contract, which in our view remains the only realistic policy for containing inflation. Like the legislation on sex discrimination and pensions which is already before the House, the Bill is designed to remove inequities between different groups of workers. Many of the rights which it proposes to extend to all employees have been taken for granted by most of those in white-collar employment.

Another of the Bill's aims is to extend collective bargaining to areas other than pay. This is entirely consistent with the guidelines for the social contract.

Finally, the provisions about disclosure of information complement those in the Industry Bill, while the development of planning agreements will combine with the proposals in this Bill to give workers, through their chosen representatives, a more effective say in decisions which vitally affect them.

In all these ways the Bill fits in with the Government's social and economic policies, and forms an essential part of them. It derives from the experience, problems and needs of the men and women who work in the industries and services of our country. By the Bill we can render a service to those whose labour creates the wealth of the country. For that reason above all others I commend it to the House.

Mr. Deputy Speaker (Mr. George Thomas)

Mr. Speaker has selected the amendment in the name of the official Opposition.

4.13 p.m.

Mr. James Prior (Lowestoft)

I beg to move to leave out from "That" to the end of the Question and to add instead thereof: this House whilst recognising that parts of the Employment Protection Bill give legislative effect to good industrial practice, declines to give a Second Reading to a Bill which makes no attempt to establish a fair balance between the rights of management and unions, adds a heavy burden of cost without proper consideration of how it should be shared by employer, employee and State, and takes no account of the particular problems of small businesses. I wish to start by saying how sorry we are that the Secretary of State for Employment is not here and, on behalf of the whole House, to wish him a complete and speedy recovery. As the Minister of State pointed out, the Secretary of State is the author of the Bill. I hope that he will find some enjoyment, if not complete enjoyment, in reading in his bed the Official Report of this Second Reading debate.

In introducing the Bill, the hon. Gentleman has shown his customary good manners and helpfulness. I hope he will not take it amiss if I say that I hope his right hon. Friend will be back for the Committee stage, when I hope he will take account of what we say.

The Bill is very complicated. The only people who should be congratulated on it are the parliamentary draftsmen, because, although it shows signs of hasty drafting, it must have been a mammoth task to produce a Bill containing 115 clauses and 16 schedules. My right hon. and learned Friend the Member for Huntingdonshire (Sir D. Renton) would know all about that task.

One example of hasty drafting concerns matters for the Industrial Tribunal, which are spread over 10 different clauses. It would have been greatly for the convenience of those who have to interpret the Bill if those matters could have been consolidated in one clause.

The Bill has been introduced very late in the Session. I cannot remember a Government introducing a Bill of this importance and size so late and expecting to get it through by the end of July, with perhaps a little left for the spill-over after the recess. As the hon. Gentleman pointed out, amendments are now necessary as a result of the Budget proposals on retraining and keeping in employment those who would otherwise be put out of employment over the next few months. There will be amendments to Clause 47. and the hon. Gentleman has already said in answer to my hon. and learned Friend the Member for Southport (Mr. Percival) and Basingstoke (Mr. Mitchell) that there will have to be lengthy discussions in Committee. When my hon. Friend the Member for Basingstoke talked about the maternity clause, I wondered whether we should spend nine months in Committee considering it if we are to bring some sense to these matters.

Have we the time to do all this? What are the Government's proposals in this respect? It brings Parliament into disrepute when we cannot give proper consideration to such a Bill. We shall not want to filibuster on it, but it lends itself to enormously long discussions on intricate matters. Parliament does not do itself justice if it just skips through a number of clauses because it wants a Bill completed by, say, the beginning of July so that the Bill can go to another place. That is not the right way to tackle such legislation.

The Bill could have formed a number of Bills of reasonable length. That would have been a much more suitable way to introduce the measures that it embodies.

Our amendment says that no attempt is made to establish a fair balance between the right of management and unions". The Bill is throughout concerned with the rights of trade unions and not enough with the responsibilities that they must shoulder as well. As trade unions are now such an important part of our economy and State, they must accept responsibilities as well as rights. That is well brought out in the Liberal amendment, which points out that they should honour their obligations under the social contract before the Government introduce further legislation as part of their undertakings under the social contract.

When the hon. Gentleman asks what obligations we wish to see imposed, our reply is that at present there are no obligations on unions to avoid strikes, keep to contracts, respect the public interest, and promote greater efficiency through increased productivity, more flexible trading methods, greater mobility of labour, and so on. None of those is an obligation which automatically flows from what is in the Bill.

A well-known labour correspondent, John Elliott of the Financial Tunes, described the Bill as— a bonanza for the unions with hardly one measure which pleases any employer. When we discussed the article at Question Time on Tuesday, the Secretary of State for Employment tried to make out that that comment was contained in a headline and was not necessarily a reflection of what John Elliott felt. As no doubt the right hon. Gentleman has since discovered, the comment was firmly contained within the article.

Clauses 11 to 16, which deal with recognition rights of unions and which allow unions to refer a recognition dispute to ACAS, whereas an employer cannot, are one example of the balance not being fairly struck between employers and trade unions. We shall wish to change that in Committee to make it possible in those circumstances for an employer to consult. We shall also wish for ACAS to have a time limit within which to finish it, and we shall try to write into the Bill that there shall be no industrial action whilst an inquiry is going on. Those are constructive measures that we shall try to write into the Bill.

Another matter of great concern to the Opposition and to many people outside relates to Clause 103 and Schedule 13, in which the right to appoint safety representation is given only to the recognised trade unions. The Opposition and many people who are members of trade unions, as well as the 50 per cent. of workers who are not members of trade unions, feel particularly strongly about the clause. We all feel that safety is too important a matter to be used to assert sectional interests. That is the only way in which one can interpret what is behind the Government's attitude. If I had to find a more suitable name for the Bill, I should call it not the Employment Protection Bill but the Trade Union Benefits (No. 2) Bill.

We should take a moment to discuss what happens when we shift the balance of power between employer and employee and between the House and people outside the House. That is an important matter for the country to think about. There is no doubt that power has shifted from this place and from the employers and into the hands of trade unions. I do not mind power shifting from employers to trade unions provided that there is a balance, but I object to power shifting from this place, because this is where real power must always reside if we are to preserve democracy.

All the actions that are being taken by the Government result in the shifting of power to the trade unions and away from Parliament. The shift in the balance of power from Parliament must concern us all. It is a shift of power resulting not only from legislation but from inflation. With inflation running at 21 per cent., 22 per cent., 25 per cent. or 27 per cent., combined with the Government's legislative action, there is not much chance of our keeping the freedom of which the House has for so long been the main centre in the world.

We were told by the Minister of State that the Bill is a further instalment in the social contract. If I have his words down correctly, he said that the social contract was the only realistic policy for containing inflation. For anyone to go on saying that the social contract is containing inflation when inflation is now at a higher level than it has ever been and is known to be going higher as the year proceeds, is to perpetrate a cruel deception on the public. Anything which makes the public believe that the social contract is working can only be a deception which is bound to have a reaction. Such an attitude suggests a doom-laden complacency because it prevents the Government from taking action which they should, and know they should, be taking.

With unemployment rising at a seasonally-adjusted rate of between 30.000 and 40,000 per month, and prices going up at the rate they are, for a Minister to say that the social contract is the only realistic policy for containing inflation shows that he and the Government do not live in the same world as the rest of us.

I shall now say a word on the subject of unemployment. None of us in Opposition wishes to see unemployment go higher by one man or woman. The attitude which we have adopted towards unemployment is a good deal more responsible than was the attitude adopted by the Labour Party when it was in Opposition in 1971–72. We accept that in so far as inflation is allowed to continue unchecked and increased wages are allowed to be granted unchecked, as they are at present, unemployment is bound to go higher. It is true that one man's wage increase is another man's unemployment, and that is now being brought home to many people throughout the country. It is a policy that we deplore.

Looking back over the years, with all the difficulties with which the previous Conservative Government were faced, I make no apologies for the stand we tried to take in February 1974. If the country had come with us in February 1974 we should not have got into the mess that this lot have got us into. [Interruption.] Before hon. Gentlemen get too excited about what they know to be true, I will continue my speech.

The amendment refers to the Bill adding a heavy burden of cost. The Minister of State told us that the cost would be about £100 million plus. He broke that down into £5 a year or lop a week per person—I am not sure which figure he chose. He implied that the figure was not much—£100 million. The question is whether we can afford that in addition to everything else for which we are having to pay as a nation. Is this the right time? Can we afford to make universal nearly all the benefits which are accepted practice by the biggest and best of our industrial firms? I do not doubt that in time we should all wish to see many of these benefits brought in —the maternity benefit, the guaranteed week payments and so on—but there is a case for saying that these should be met by the State and not by the employer or the employee. In many Common Market countries those benefits are the responsibility of the State. The House has not at this time decided what is the responsibility of the employer, the employee or the State in these matters, and we should do that before we decide to put the responsibility on to the employer, as the Bill does.

Members opposite must understand that the angry reaction of employers to the Bill stems not so much from one particular item or one particular increase in cost, but from an accumulation of irritations with the Government over a period. I think that that irritation goes back and extends to more than one Government. Government legislation is now pouring through the House. It is ill digested and ill thought out. Whether it be capital transfer tax or the measures in the Bill, a great deal of legislation is proving too much for a large section of industry to digest. Small firms, which my hon. Friend the Member for Basing stoke has already mentioned, are of particular concern in that respect. I am glad that we have referred to small businesses in our amendment. I think that the Liberal Party would agree with that approach.

I think that it would be right at this stage to set a limit to the number of employees so that under a given number the Bill will not operate. It may be argued that it would be wrong, as it were, to make second-class citizens. However, I do not believe that by adopting that approach we would be making second-class citizens. There are an enormous number of people who prefer to work for small firms and to work for a boss who knows all the men and women by their Christian names. They can leave work when they have to and they can work extra hours when necessary. In small firms there is a different relationship between employee and employer and a great many people are employed in that way. A great many people prefer to be employed in that way. We need to increase the number of small businesses and small firms and not to discourage them.

I suggest that my hon. Friends and myself should table an amendment in Committee to exclude small businesses. By such an amendment we would seek to exclude small businesses with 100 or fewer employees from the operation of this measure at this stage. I think that would meet with the approval of all employees in small businesses as well as employers.

Mr. Ivor Clemitson (Luton, East)

Would the right hon. Gentleman advocate a similar lower limit for the Redundancy Payments Act and for the unfair dismissal provisions of the Trade Union and Labour Relations Act?

Mr. Prior

No, I would not do so for those measures. Both those measures—and I am glad that the hon. Gentleman pays tribute to them—were introduced by Conservative Governments. The Redundancy Payments Act and the unfair dismissal provisions were both the result of Conservative Governments. I am pleased to support that.

Mr. Clemitson


Mr. Prior

No, not again. I must get on. The Redundancy Payments Act 1965 was introduced as the result of Conservative Government action in 1964 for which Lord Blakenham was responsible.

The Under-Secretary of State for Employment (Mr. Harold Walker)

Will the right hon. Gentleman correct that statement? Does he recall that the Redundancy Payments Act 1965 was introduced by a Labour Government?

Mr. Prior

It followed the White Paper that was introduced by a Conservative Government. The only trouble was that we did not have the time to put the White Paper into operation. The Act was entirely based on the proposals put forward by Lord Blakenham when he was Minister of Labour.

I now turn to the information clauses, to which we have no objection. They are the same clauses, with perhaps a little elaboration, as were contained in the Industrial Relations Act. I have in mind Clause 56 of that Bill. They were also set out in not very great detail in the disclosure of information clauses in the Code of Industrial Relations Practice. We should give employees every possible help so that they know what is going on in their firm or organisation. There has been a great change in the attitude of industry to these matters in recent years. I would like to see that change extended in every possible way and to the extent that the clauses guarantee security, where necessary, for employers. That also applies to employees or trade unions for the purposes of collective bargaining. I am delighted to go along with that.

I turn to what I believe is a contradiction in Government policy. As I understand it, Labour Members and some trade unionists outside the House wanted to destroy the Industrial Relations Act because they maintained that industrial relations and the law were totally different. They claimed that the law had no part to play in industrial relations. The Bill introduces the law in many areas where we have so far proceeded in a voluntary manner. I grant that it has a trade union bias, but it introduces the law in that respect.

I have come to the conclusion that it is not so much that Labour Members or trade unions dislike the law, as that they merely dislike some laws and that they dislike Tory laws—[HoN. MEMBERS: "Yes."] That is what it is. We now know the position from the reaction of those on the Government benches. We now know what it is they dislike. The hon. Member for Tottenham (Mr. Atkinson) has said that there are two sorts of law—namely, ordinary law and political law. He claimed that we do not have to obey political law. I think that the position is now clear.

The extension of statutory regulations into many areas reserved for free collective bargaining is in many respects a retrograde step. Many matters such as guarantee payments, maternity arrangements and time off for trade union activity would have been better introduced through codes of practice rather than through writing them into the law. Traditionally they are matters for voluntary arrangement and it would have been best to leave them for voluntary decision.

I have received a letter from a small business man about the maternity arrangements that are proposed in the Bill. He says that the reinstatement provision cannot be made to work in a small company where it is necessary to train only one order clerk or one wages clerk. He points out that if such a person goes on maternity leave it is necessary to train someone else, and that a small company cannot train someone for only a few months. It is necessary to have a continuity and regularity of employment and the Bill will militate against that as regards maternity arrangements. If the arrangements are left as they are, there is a good chance that large firms, where many women are employed, will react against the employment of women. That could decrease the number of jobs that are available for women. On this subject, I have received a good deal of information and many representations.

I turn briefly to Clause 1 and the Advisory, Conciliation and Arbitration Service. I say straight away that we support the service. We wish it well, and it will not be our intention to disband it when we return to office in the near future. We shall support the service but we think that the terms as laid down are much too narrow and much too concentrated on collective bargaining. We believe that the service should concern itself with the peaceful settlement of issues that arise between employer and employee, and the safeguarding of individual rights of employees who are threatened by employers, trade unions or fellow employees. The service is much too narrow and too much based on collective bargaining.

I hope that Labour Members will pay attention to the fact that an employer will not be able to submit a recognition dispute to the Advisory, Conciliation and Arbitration Service. That may well result in employers not wishing to use ACAS and not having a great deal of confidence in it. In trying to build up a proper conciliation and arbitration service the organisation involved must have the respect and full authority which only a totally independent authority can command.

In regard to the composition of that body, I am not certain we need three academics or three outsiders. The matter should be examined in Committee. I do not know whether it is a good practice to have its chairman appointed by the Secretary of State or indeed to have the the service appointing its own chairman. Again, we should like to examine that matter in Committee.

I hope that employers will put their weight behind ACAS and appoint top-grade people who are well known in industry and in the country generally. We shall give further attention to that matter in Committee. We wish ACAS to go ahead, and we hope that it will turn out to be successful.

I turn to the Central Arbitration Committee, which will replace the Industrial Arbitration Board. Clause 88 deals with the extension of terms and conditions and gives the right to a trade union to take a claim to the Central Arbitration Committee. The CAC can make an award and the employer must submit to it. But what happens if the union concerned fails to observe it? I see nothing on those lines laid down in the Bill, and we should like to hear the Government's views.

I should like to examine the relationship between the CAC and ACAS. Suppose the Government lay down a pay policy. Can ACAS tell the CAC what to do? What powers has ACAS over CAC in these matters? Perhaps the Minister will give us that information.

Many of the new benefits are to be enforced by the Employment Appeal Tribunal under Clause 77. That tribunal will have High Court status. My hon. and learned Friend the Member for Southport will be interested to compare the clause which sets up the new body with the clause in earlier legislation which set up the National Industrial Relations Court. The words have been juggled around a little, but they are absolutely identical. I presume the words have been juggled around to conceal something, although I am sure Labour Members would not be confused or misled by that.

In trying to insist that so many of these provisions favourable to the trade unions have statutory backing to ensure that they are enforced, the trade unions may be hoist with their own petard. In order to achieve that aim the Government are setting up almost the same pieces of machinery as existed in the Industrial Relations Act. From the Government's point of view it might have been wiser to have relied on codes of good industrial practice rather than to try to put so much into statutory form.

There are a number of useful measures for employment protection in the Bill, but the whole majesty of the law has now been invoked. We do not think that this is the right time to take that step, nor do we think that the Bill is the right way in which to act. However, I assure the Minister that we shall try to improve the Bill and that we shall be constructive in our discussions in Committee. But I feel that the Bill shows the wrong mentality. It is conservative with a small "c", in its worst possible form. The Bill contains nothing which will increase production or which will create a larger cake for the nation to share. There is nothing in the Bill which will make the rewards of hard work and greater production really worth while. There is nothing to deal with the great problems of job protection or with unemployment. There is nothing to deal with the problems of overmanning or with the problem created by school leavers—a problem which will be particularly severe this summer.

On Saturday the Secretary of State, commenting on the unemployment figures, said: I read these figures with horror and with shame. These are figures we have to have before us every day of our political lives. I want to see every instrument available at our command to deal with unemployment here and now. Perhaps the greatest problem we face is that of overmanning—for example, how to get people out of industries such as the car industry and to put those people into other industries. We must learn how to carry out that process without causing bitterness and loss of dignity that comes from losing one's job. This cannot be done easily, but nor can it be done in the long run by pushing more and more money into an industry so that jobs can be maintained.

Looking back over the years, I believe that we had the same problem with Upper Clyde Shipbuilders. I believe we should then have said "We shall put more money into the setting up of new industries on Upper Clyde and shall train shipyard workers to go into those industries". We should then have gone on to say "We shall take a year or two, we shall go on paying you in your job during that time —but then we want you to move". That is a much more positive way of setting about the matter than by pushing out more money to prop up an old and dying industry or an industry which is suffering from an overmanning problem, as many of our industries are. I do not think we shall solve that problem by backing outdated industries or practices. The same considerations apply to the debate in the House recently when we discussed the Government's proposals for the docks.

I turn to the subject of school leavers. What is the alternative for them this summer? A further year at school kicking their heels because they cannot get a job will not make them into very good citizens. The alternative will be the dole queue or an unsatisfactory job. What are we doing about the situation? Although we are prepared to put £1 million a day into British Leyland, last year on Community Industry, which seeks to train only 1,500 young people, we spent £1.6 million for the whole year from Government resources.

It is not good enough to look at the problems of employment protection on the narrow, conservative lines which the Government have adopted in this Bill. The Government are spending £1 million a day to prop up British Leyland and will spend £100 million as a result of the provisions of this Bill—and yet nobody can say that the Bill will preserve a single job. We shall just make it less easy for the bad employer to sack somebody unnecessarily. The legislation will not create any new jobs, nor will it make the country a fitter or more prosperous place for our citizens.

Because we believe that the Bill is ill-timed and does not attempt to deal with the problems that face our society, we shall vote on our reasoned amendment this evening.

Mr. Deputy Speaker (Mr. George Thomas)

A very large number of hon. Members wish to take part in the debate, and I hope that accordingly hon. Members will be considerate in making their contributions.

4.50 p.m.

Dr. Edmund Marshall (Goole)

I shall not attempt to follow the right hon. Member for Lowestoft (Mr. Prior) in his wide-sweeping remarks about the general employment and industrial situation. Instead, I wish to concentrate on some of the practical details of how the provisions of two clauses of the Bill will affect the ordinary day-to-day affairs of the people whom we are sent here to represent.

I want to give a warm welcome to the Bill, especially to Clauses Nos. 57 and 58, which will give new rights to employees whose employer becomes insolvent. As my hon. Friend the Minister of State has said, under Clause 58(2) it is proposed that payments should be made out of the Redundancy Fund to meet arrears of pay due to employees of a bankrupt firm and also any payments in lieu of notice and holiday pay which are still due to them.

The urgent need for legislative provisions such as these was fully demonstrated to me by an incident which occurred in my consituency as recently as last December and which my hon. Friend the Under-Secretary of State will remember well, as he and I discussed it at that time. He is one of my geographical neighbours, and the incident to which I refer occurred within the Doncaster metropolitan borough at Thorne, a town in my constituency, where there is a light industrial estate in Coulman Street which has been developed through the efforts, over recent years, of local authorities, industrial development agencies and the regional offices of Government Departments.

In the middle of 1973 one of the factories on that estate was occupied by a firm called Humberside Frozen Foods Ltd., a food processing firm, which provided valuable employment for about 40 local people, most of them women. I note that this firm would, therefore, be regarded by the right hon. Member for Lowestoft as a small firm, and in his view the kind of problem which I shall describe is one that should not be tackled by the Bill. However, without any warning at all, on Wednesday 18th December 1974 all the employees of Humberside Frozen Foods Ltd. received summary notices of dismissal. I have one of those notices with me. It is very brief. It reads: It is with very great regret that we have to inform you that as from today's date this factory will cease activities owing to circumstances beyond their control. Arrangements have been made with the Social Security, you should report at the Job Centre, Thorne, tomorrow…with all your pay slips at 11 a.m. All assistance possible will be given through this office. That happened exactly one week before Christmas Day. The 40 employees found themselves completely out of work. They had no pay in lieu of notice; there was no payment of holiday pay due to them; there was no payment of wages which were already outstanding. It had been the practice of the firm to pay wages in the week following the week to which they were related. Therefore, arrears were considerable. The total debts owing to one lady employee were £111.89. That money was cut off from her. Because wages were paid in arrears it was not possible for any employee to claim unemployment benefit for the week following dismissal. Most of the employees, who, as I have said, were married women, found that they had no entitlement to supplementary benefit because their husbands also were, happily, in employment.

However, this blow could not have fallen at a worse time of the year, with all the expenses arising for these families at Christmas time, particularly on presents for the children.

Many of the employees came or wrote to me, and I have here their letters asking for advice and assistance. It was distressing to have to tell them that as the law stood at that stage their only means of redress was to seek repayment of the debts due to them by notifying the liquidator of the firm and seeing that their names were correctly included on the list of creditors. As the first meeting of creditors was not until 14th January 1975 this advice was cold comfort.

I was later informed that the machinery which was owned by Humberside Frozen Foods Ltd. and operated at this factory had been hastily removed overnight from the premises. The premises were rented from, and, thereforefore, owned by, the local authority. There were therefore no assets at the factory for the liquidator to realise. I have not been able to find out exactly who was responsible for that situation, but I condemn the whole manoeuvre as sordid and disgraceful. It left the employees as the completely innocent victims.

If the proposals in Clause 58 are enacted, I am given to understand that the general intention is to meet the difficulties of people who were in the same sort of position as my constituents. There is the danger that the enactment of these provisions may encourage other unscrupulous employers to do this sort of thing, but at least we shall have some protection for employees who find themselves suddenly out of work in these circumstances.

I hope that in his reply my hon. Friend will say a little about how exactly these provisions would have operated in the case to which I have referred.

Clause 58 says that application has to be made to the Secretary of State by the employee. Does this mean that it will be possible for an employee to do this at any office of the Department, and will officers of the Department go out of their way to explain to employees in this sort of situation exactly what their rights are for making application?

I am also a little uncertain as to the exact meaning of Clause 58 (7), which refers to cases where a trustee in bankruptcy or liquidator has been or is required to be appointed …". It also says: The Secretary of State shall not entertain any applications for a payment…unless he receives a statement from the trustee in bankruptcy or liquidator …". I am a little worried that that subsection may lead to some delay before the kind of payments to be made in accordance with the clause may be made to the people who are applying for them.

I hope that when my hon. Friend replies he will be able to show exactly how it is intended that these provisions should operate. I hope that he, as I, will give all possible speed to the Bill so that the kind of situation which I have described in my constituency cannot occur again.

5.0 p.m.

Mr. Cyril Smith (Rochdale)

I share the condemnation which the hon. Member for Goole (Dr. Marshall) so graphically outlined, but I am sure that he will forgive me if I do not follow him except to observe that there was a time in his political career when he strongly supported regional government. He has just demonstrated the need for it.

This Bill is peculiarly named—the Employment Protection Bill. No Bill was ever more wrongly named. If the Bill has an effect on employment at all, it will certainly not protect it but is more likely to do the opposite. If the Government wish to protect employment, they must do something about the ridiculous, excessive and highly inflationary wage settlements now being awarded and negotiated I appears that 30 per cent. is the order of the day this year, and I have read that one union leader is talking of claims averaging 50 per cent. next year. My comment on that type of suggestion is "How daft can we get?"

Much of the Bill is designed not to protect employment but to strengthen the hands of the already over-powerful trade union movement. One has only to look at Clause 100 and Schedule 13 to see that. This legislation is not likely to contribute to good industrial relations, and in many circumstances it may sour them.

The right hon. Member for Lowestoft (Mr. Prior) referred to the introduction of law into industrial relations as a consequence of the Bill. At that point in his speech, as indeed at others, I was saying "Hear, hear". I remember over the last 12 months some of the bitter crticisms by the Minister of State of the 1971 Industrial Relations Act. I remember his harsh and grossly unfair criticisms of the judiciary and his expressed hatred, almost to the point of eccentricity, of judges interfering or being involved in industrial relations. But Schedules 1 and 5 do exactly what he criticised. That is hypocrisy. It would serve the Government right if the judges, refused to serve in this instance. If they are called upon, as they are under the Bill, to serve in industrial relations matters and to arbitrate, I hope that on this occasion they may expect the support rather than the venom of some Ministers.

We need to get industrial relations on a firm, fair and proper footing. This implies worker participation. but I would stress as I have done many times before that there is a great difference between worker participation and union participation. The sooner the Government understand that they are not the same thing and reflect that understanding in legislation the better chance we shall have of getting industrial relations on a proper footing.

To do this, co-operation is required from management as well as from unions. To introduce, especially at this time, a Bill which is so one-sided, which gives help only to the unions, without any employer rights or protection, is ludicrous stupid, provocative and, it I may use the word again, daft.

Many employers, especially small firms, will soon have to consider appointing someone to ensure that they do not break the law. This is not a flippant remark; I speak as someone who employs 70 people. We are being inundated with so much legislation that small firms cannot cope. It is all right for companies with 200 or 300 employees, who have accountants and legal advisers, and I am not arguing that small companies should not have to comply with the law. But we should surely be able to absorb one new Act before another drops on our desks. We are required at times, to put up notices saying what our policy is, on health, and safety for example, to be followed by another the very next month.

We are reaching the stage at which we are frightened that unless we have a legal adviser we shall be sued for breaking the law when we had not known that we had broken it. This is the worry of small companies—not that they are opposed to the legislation or object to having to comply with the rules like employers who employ large numbers. They object simply to the speed and complexity of the process. I hope that the Government will understand that this is a real problem for employers with small numbers of employees—a phrase that I prefer to "small employers".

The Liberal Party believes that people should be given time off for public service as provided in Clause 53. I doubt whether that is so much of a problem as to require legislation, and I should like some convincing when it comes to my own part of the world. There is no shortage of Labour candidates in my constituency or in adjoining constituencies. However, if the Government can convince us of the need, we shall not oppose the clause. We simply question this provision on the ground that we should not legislate unnecessarily.

Of course we welcome the provisions for proper payments for periods of pregnancy and maternity, but we are entitled to ask whether this is the responsibility of the employer or of the State. What do married women in industry pay their insurance stamps for? What does the employer pay his proportion for? While I and my party welcome the idea of women being entitled to proper pregnancy leave and certainly to proper payment for the period of maternity, we question whether this should be the financial responsibility of the employers rather than the State. Clause 44 is, therefore, fraught with difficulties for employers, although on balance I commend it and I realise that it can be considered in Committee.

I have every sympathy with Clause 22, relating to guarantee payments in the event of lay-offs, but I should have more sympathy with it if I were satisfied that the Government intended to assist the textile industry. In its present circumstances, that industry must be particularly vulnerable under the clause. If people are prevented from working through no fault of their own, simply because the work is not available, they should be paid for the period when they cannot work, but we are entitled to ask whether, if the reason for the lack of work is Government action rather than the action of particular employers, the payments should not be the responsibility of the State.

If the Bill is given a Second Reading, we shall seek to press many amendments in Committee. We shall want to examine Clause 17 on the disclosure of information. I entirely accept, as did the right hon. Member for Lowestoft that on immediate reading the clause appears to be all right.

I should welcome a clause being introduced by the Government to cover House of Commons staff, because some of the orders and some of the rules which I see being applied here to staff as to Members of Parliament are Victorian in their concept. I am not surprised that the rules were drawn up in the time of Tchaikovsky's 1812 Overture.

My main criticism of the Bill is not merely for what it does but for what it fails to do. It offers little protection for the lower paid in that it fails to introduce a statutory minimum wage. I listened carefully to what the Minister of State said in introducing the Bill. I take his point. Tomorrow I shall read what he said more closely in Hansard. It may be that when we reach Committee I shall have to temper my judgment.

As I read the Bill, there is a disgraceful omission. The Government have not included any provision for a statutory minimum wage. The onus is still on people to establish a case rather than their being told "You are entitled by law to, say, two thirds of the national average wage."

It is disgraceful that a Government who try to kid people that they are concerned about the lower paid cannot do something about introducing a statutory minimum wage. By continuing to ensure a free collective bargaining system without a statutory minimum wage one supports the strong and deserts the weak. In our present inflationary system, the strong survive and the weak get weaker.

I understand that the Secretary of State has had correspondence with the Low Pay Unit about the possible introduction of a statutory minimum wage. We are entitled to ask the Under-Secretary to refer to the correspondence. I understand that the Secretary of State promised that problems such as those connected with home workers would be alleviated in the Bill and that he talked about the possibility of a statutory minimum wage, but ultimately had to reject it because the Government wanted to retain free collective bargaining and a statutory minimum wage would preclude that. As regards the problem of home workers, we are entitled to ask what happened to the promise the Secretary of State made to the Low Pay Unit.

The Minister of State agreed that the Bill is yet another instalment of the price that the Government have agreed to pay for what he calls "the social contract" but what I have heard referred to as "the social con-trick".

A contract implies a bargain between two sides, not one side alone. As the trade unions, or at any rate some of them, have manifestly not delivered their half of the contract, in that there have been excessive wage claims and wage increases have been negotiated more than once in a period of 12 months—the Minister of State said that there had been some wage settlements which he deprecated as going outside the social contract—we suggest that the House should decline to give a Second Reading to the Bill until the unions make their sessionary instalment and prove that they are prepared to meet their side of the social contract.

The Bill is like a curate's egg. In parts it is good. In others it is hopelessly misconceived. We have reached a stage in our social history where we need to consider where we are going as a nation. In industrial relations we need to unite the nation rather than divide it. Employers with small businesses, the self-employed, small shopkeepers and people like them are getting rather tired of being pushed around by successive legislation. The Bill is one more nail in the coffin. It is geared to increase the powers not of workers but of trade unions.

Because the Bill does nothing to help the weak, the lower paid and home workers, because it shifts the proper financial responsibility of the State on to the improper responsibility of the employer, because of its timing in relation to the national economy, this evening my colleagues and I will, because our own amendment has not been called—we do not question Mr. Speaker's right in that regard—either be supporting the official Opposition amendment or, alternatively, forcing a Division against the Second Reading of the Bill itself. I suspect that we shall choose to support the official Opposition amendment merely in order to save having two votes.

If none the less the House should approve the Bill, the House can rest assured that in Committee and on Report we shall be seeking to amend the Bill so that it will be a better Bill. We shall seek to ensure that it helps people rather than unions, that it makes a positive contribution to good industrial relations, and that it becomes what it certainly is not now—a Bill concerned with employee protection in those areas where protection is necessary, and that it concerns itself less with party dogma and far more with making a positive contribution to gettting the country back on its feet.

5.17 p.m.

Mr. John Evans (Newton)

Unlike the hon. Member for Rochdale (Mr. Smith), I wholeheartedly welcome the Bill. It is one of the most important pieces of legislation the House has considered for many years. It will be welcomed not only by the vast majority of the trade union movement but also by many of the most progressive employers. Many progressive employers have conceded more than the Bill sets out to secure for employees.

I declare my interest in the Bill. Like my hon. Friend the Minister of State, I am a sponsored member of the Amalgamated Union of Engineering Workers, and until February last year I was an hourly-paid shipyard worker on Tyneside. I was for many years a shop steward. Together with many of my colleagues in the trade union movement I fought hard for years to establish in our industry some of the things which the Bill sets out to secure.

It is incredible that in 1975 in this democratic country we are legislating for such fundamental things as the right to belong to a trade union and the right of a trade union to represent the interests of workers about their wages and their conditions of work at their place of work. It is nonsense to suggest that this will bankrupt industry. We seek to bring democrary into the work place.

It is of equal importance that we have the next Bill, to which my hon. Friend the Minister of State referred.

The Bill honours another pledge of the Labour Government. We said in our manifesto that we would repeal the Industrial Relations Act, which was responsible for so much of the bitterness and hatred which were engendered in industry under the last Tory Government. We repealed that Act. We did not often have the support of the hon. Member for Rochdale at that time, so we are not surprised that he will not be supporting the Bill tonight.

Mr. Cyril Smith

I am rather intrigued by that statement, and I should be glad if the hon. Gentleman could substantiate it. Throughout the election my party indicated that we would support the repeal of the Act. We voted at all stages for the repeal of the Act. What we did not do was support some of the amendments submitted by hon. Members opposite—not amendments to the Act which they were seeking to repeal but amendments to the position which existed prior to the introduction of the Act, such as, for example, on closed shops.

Mr. Evans

On the few occasions when the hon. Member was present in Committee he often voted against the Government and supported amendments which the official Opposition put forward. if he doubts my word, let him read the Official Report. It i, there for all to see.

I should like to comment on one or two issues arising from this Bill. The first one, and probably the most important, is the setting up on a statutory basis of the Advisory. Conciliation and Arbitration Service. Anyone who has ever had any responsibility on the shop floor for negotiating on behalf of his fellow workers learns very quickly that one thing that one must do is to settle disputes between employer and worker before they reach the stage of a strike, because it is when a dispute reaches the strike stage that the bitterness, anger and hatred creep in.

One thing that we have learned over the years, and certainly prior to the Industrial Relations Act, is that the trade union movement welcomed the arbitration service of the old Ministry of Labour. It is essential that we get the ACAS on to a firm basis, and I hope that there will be a wide expansion of this service. I know that the trade union movement will welcome it. I also hope that the employers will accept the words of the right hon. Member for Lowestoft (Mr. Prior) and that they also will support the ACAS. It is essential that we create a new feeling within industry about industrial relations. This Bill will not only protect jobs. If we can get that spirit of co-operation and conciliation which is so essential in industry, we shall promote employment. To achieve this, it is essential that both sides of industry work together with the ACAS.

The Bill refers to a guarantee payment to the employee, and I confess that I feel this does not go far enough. The principle is sound, and many firms have already agreed to some such arrangement. But I ask the Minister to give some consideration to the £6 a day clause. I ask him to withdraw the word "maximum" and to substitute "minimum". I ask him to bear in, mind the TUC policy of a £30 a week minimum wage. I also ask him to bear in mind that many employers have long ago conceded much higher payments than £6 a day. I suggest, therefore, that the word "minimum" is preferable in this context.

The other aspect of the Bill to which I wish to draw attention is the question of time off for those who wish to participate in local government and trade union business. I used to be an hourly-paid worker, and I served the local authority and my trade union. I suggest to the hon. Member for Rochdale that it is essential that statutory provision be made in this respect. More and more hourly paid workers find it increasingly difficult to serve on local authorities and public bodies, and this applies particularly to the Labour Party because it has the greatest number of hourly-paid workers in its ranks.

My only criticism is that the Bill is rather woolly in this respect. Clause 53(4) states: The amount of time off which an employee is to be permitted to take under this section … in that which is reasonable in all the circumstances having regard, in particular, to … (c) the circumstances of the employer's business and the effect of the employee's absence on the running of that business. With respect to the Minister of State, I say that a couple of buses can be driven through that provision. I suggest that we should insert a stated number of days, as is already done by many local authorities which have employees who serve on other bodies. That would be fairer than leaving this provision which could mean that an employer could say to somebody wishing to serve on a local authority or hospital board "I am sorry; I cannot allow you any time off work because of the effect it will have on my business.'

The clause on picketing is not good enough. We must tackle the whole question of the legal rights of pickets. We must accept that in an industrial country there must be pickets in industrial disputes when passions run high and tempers are roused. I ask the Minister to look again at the question of obstructing the highway. A picket must have the right to stop a lorry and put his views to the lorry driver peaceably. He cannot put his views to the lorry driver when the vehicles is going past at 30 miles per hour.

Mr. Percival

Does the hon. Gentleman mean that the picket should have the right to stop a lorry driver even if the lorry driver does not want to stop and does not want to listen to the picket?

Mr. Evans

Bearing in mind that the pickets will be at the factory gate, unless the employer goes along with blacklegging intentions and opens the gate so that the lorry can be driven it, it will not be too difficult for the driver to stop the lorry.

Mr. Percival

Answer the question.

Mr. Evans

I am saying, yes, the picket must have the right to stop the lorry. He must have the right to put to the lorry driver his point of view about the cause of the dispute.

I ask my hon. Friend to consider this point. As we are speaking in terms of obstructing the highway, would this apply to a man on a bicycle who is attempting to drive to work and is blacklegging? Hon. Members opposite who have little knowledge of strikes may not know what is meant by the terms "blackleg" and "scab". To a man who works 40 or 45 hours a week those terms are very emotive, and a man who attempts to break a strike is rightly termed a blackleg and a scab. We must get this issue clear in the Bill. We should define what we mean by the word "picketing". I accept that we still have not correctly defined the law on picketing, and I should like that law to be clearly defined.

Most Governments have attempted to pass some form of legislation on industrial relations. The major mistake that most Governments have made is that they have not consulted, nor have they taken into account the feelings and the views of, workers with respect to whom they were seeking to pass legislation. This Bill does not make that mistake. We have taken cognizance of the views, the feelings and the fears of workers in industry.

I do not believe that this Bill is a gigantic step forward in industrial relations. The most important aspect of the Bill is that for the first time Parliament has got on to the right road concerning industrial relations. Politicians may find themselves in league with the men and women who work for a living. I hope so. The Bill has been sub-titled "In Place of Strike ". I think that is the best title for this Bill, which will go a long way towards bringing peace to industry—the peace that this country so desperately needs.

5.30 p.m.

Mr. Philip Holland (Carlton)

As I am unable to share the euphoric approach to the Bill expressed by the hon. Member for Newton (Mr. Evans), it will probably save the time of the House if I do not take up each of his points in detail before coming to my own observations, though I shall deal with some of his remarks as I go along.

During the past 12 months the Government have presented a series of Bills with beguiling and totally misleading titles designed collectively to concentrate all power in the hands of the few while progressively destroying the enterprise of the many. All such legislation, whether it be the Trade Union and Labour Relations Act, as amended, the Industry Bill, the Community Land Bill, to come up for Second Reading tomorrow, or the present Employment Protection Bill, contains a sprinkling of "goodies"—I have in mind here what is referred to in the Opposition amendment as giving legislative effect to good industrial relations practice—but the "goodies" are intended to distract attention from the long-term objective of replacing our free collective bargaining system with a system which one can only describe as industrial totalitarianism.

The Bill purports to be an Employment Protection Bill, but it will contribute, as the hon. Member for Rochdale (Mr. Smith) said, not to an increase in employment but to an increase in unemployment by adding directly to the costs of many small businesses already reeling under the burdens of excessive taxation, high rates and heavy social security payments. In spite of the expressed concern of the Minister of State, every new impost puts further at risk the livelihood of a quarter of our working population currently employed in small businesses.

The proposals in Clauses 51 to 53 to give employees a legal right to time off for a wide variety of activities at the employer's expense will add considerably to unit costs, while the provisions in Clauses 22 to 29 for a mandatory guaranteed week will be a great stimulus to employers in some of the more seasonal industries to reduce their overall labour force rather than incur the high expense of periodic temporary lay-offs. As my right hon. Friend the Member for Lowestoft (Mr. Prior) pointed out, the right to maternity leave will lead to employment difficulties for women.

Thus, far from being a Bill for the protection of employment, it will create some unemployment. It will, of course, protect the employment of trade union officials by the provisions made for trade union recognition in Clauses II and 12, the guarantee of time off for union activities at the employer's expense in Clauses 51 and 52, and the strong statutory prejudice in favour of trade union membership in Clauses 47 to 50. As an alternative to my right hon. Friend's suggestion, I suggest that we call the Bill the Trade Union Officials Employment Protection Bill.

The confidence trick is not confined to the Short Title. In the Long Title it is claimed that the Bill will establish machinery for promoting the improvement of industrial relations. In fact, it will in parts restrict and confine, and ultimately destroy, free collective bargaining over a wide area. Many of the provisions are divisive and will create new tensions in industry.

Here is but one example. The provision in Clause 11 for any independent trade union to be able to apply to the Advisory, Conciliation and Arbitration Service for recognition, which the service may then make mandatory on the employer, is a negation of the collective bargaining räle. It requires no account to be taken of existing arrangements, perhaps with other trade unions, or of the wishes of the majority of employees. It leave the union free to accept or reject the recommendation but imposes it on the employer without the option and without right of appeal. It opens the door to a growing multiplicity of small unions and increases the hazard of inter-union dispute. It has been described as an open invitation to minority interests to create industrial disruption, and I agree with that assessment.

Mr. Tom Litterick (Birmingham, Selly Oak)

Did the hon. Gentleman ever read the Industrial Relations Act?

Mr. Holland

I am glad the hon. Gentleman raises that point. I find a distinct difference where there is a procedure which is used as a last resort for arbitration by a tribunal, where both sides may state the case fully and where, at the end of the day, if either side does not like the decision it may appeal to the High Court. There is no such appeal system in the procedure proposed here.

Good industrial relations depend above all on mutual understanding between the two sides meeting as equals in the free collective bargaining procedures. They cannot bloom in a climate of State compulsion. Neither can they prosper when one side is handed all the rights, all the privileges, all the patronage and all the power, while the other side is clobbered with all the responsibility, has none of the rights and has only the manoeuvrability of a tram.

Not all the Long Title is misleading. In places it admits more openly to its purpose of concentrating power in the hands of the few in so many aspects. For example, it refers to the transfer of the exercise of licensing functions under the Employment Agencies Act 1973 from local authorities to Whitehall. It refers to the proposal to amend the Health and Safety at Work Act 1974 as regards the appointment of safety representatives. The Under-Secretary of State will not have expected me to overlook that.

This last amendment makes a mockery of the whole concept of elected safety representatives and calls in question the Government's sincerity in their much publicised efforts to improve industrial safety, for there can be no safety reason for deleting from the Health and Safety at Work Act provision for the election by employees of safety representatives from among the employees. How does that improve safety? Certainly, it has nothing to do with the protection of employment. What is more, it removes what could be a fruitful area of consultation between employees and management, so it does not even help to improve industrial relations either.

The purpose of this apparent piece of folly is made clear not in Schedule 13, in which the amendment occurs, but in Clause 103, which refers directly to it. It is to restrict the appointment of safety representatives to those appointed by the officials of the big trade unions—in other words, again to concentrate all the power and patronage in the hands of the militant few.

The Bill is indicative of the muddled thinking of the Government, a Government who have failed to keep pace with the realities of the development of industrial relations techniques over the past 20 years. Full employment is not protected by putting shackles on management and giving power and privilege to those who carry no responsibility for the success of the enterprise. Full employment is protected and maintained by good commercial and industrial management, stimulated by the profit motive and backed by rising levels of investment.

Economic growth is the basis of prosperity, and it is on prosperity that the protection of employment depends. The Bill contributes nothing to either economic growth or national prosperity.

As regards improvements in industrial relations, these depend on the good will of both sides of industry, and on both sides, too, understanding their identity of interest. Both sides need patience, understanding and tolerance. The Bill is divisive and contributes nothing either to the needs of industrial relations or to the protection of full employment.

I hope that my right hon. and hon. Friends on the Opposition Front Bench will be in no doubt that on this occasion they and I are marching in step, and I shall certainly support their opposition to the Bill.

5.38 p.m.

Mr. Frank R. White (Bury and Radcliffe)

In my opinion, the Bill should hold no fears for companies which work at their industrial relations. Unfortunately, even after a decade of parliamentary involvement in industrial relations matters, far too many firms do not give this subject proper consideration or the proper status which it should have in management structures.

Firms which are successful in industrial relations often have the personnel function represented at director and board room level, but there are too many British companies which still treat the personnel function, the industrial relations function, as a sort of industrial paternalism—I am reminded here of what was said by the right hon. Member for Lowestoft (Mr. Prior) opening for the Opposition—reminiscent of the "happy chappy" company in which people do not talk about wages and conditions so long as they get a bottle of sherry at Christmas. Equally, there is the company in which the personnel or industrial relations function is a place to ease out some fading management star—" He is no good at finance or manufacturing any more, so shove him into personnel. He cannot do much harm there, and we shall always be over him anyway." If half the thought that went into sales, marketing and accountancy was put into industrial relations before companies took actions many of which cause unrest, a positive step forward would be taken.

Two weeks ago I attended the annual luncheon of a local employer's association, and I sat beside the managing director of a large multinational engineering company. He spoke to me about problems that were current in his particular activities and described how he had to get together with his co-directors to discuss them. He was amazed that his directors, when challenged with a question, were so confined to their specific functions. The marketing man could only speak about marketing, the sales man could deal only with sales and the finance man was restricted to his sphere. But, he told me, a decision was taken and he then went to see the chaps on the shop floor. I asked him where the personnel man was, the man who could tell him what the reaction from the shop floor would be. I asked whether he was involved in the decision-making process. He told me that he was not; he came under the manufacturing director or perhaps it was the works manager who was responsible to the manufacturing director.

During the course of the lunch the Chairman of the National Coal Board, Sir Derek Ezra, addressed us for about 20 minutes and spoke for five minutes about industrial relations problems, and a very good speech it was. The reply to that speech was made by the Chairman of the Employers' Association, who reversed Sir Derek Ezra's priorities and spoke about the problems of the nation and the economy. He spent five minutes thanking Sir Derek and 15 minutes slamming trade unionists, the Labour Party in general, the Government and industrial relations in particular. I went over afterwards to speak to my managing director friend, and I said how marvellous it was that all the problems of the country were not centred around accountancy, finance, sales or marketing, but were about industrial relations. Yet the man who makes the decisions, the man who helps to try to formulate policy on industrial relations, could not even get into the boardroom or have his point of view made known before the decisions were taken. The managing director accepted my point, but he did not say what action would follow.

It is no good using industrial relations for fine "blood and thunder" after-dinner speeches and then going back to the company and using the same age-old procedures, the same age-old management structures, and making no attempt to implement modern structures, modern procedures, or to overhaul the systems to meet modern industrial relations pressures. It is no good ignoring the treatment, because if industry carries on in that fashion it may create gastronomic ulcers at the after-dinner speeches but it will certainly create industrial ulcers, as is now being proved. All those who mean business and have accepted the problems caused by industrial relations are overhauling their procedures and meeting the demand, and I congratulate them. For such people who take labour relations seriously the Bill holds no problems.

I wish to deal with the question of the wages councils. I declare an interest in being a member of the General and Municipal Workers' Union. My union, more than most, is involved with wages councils and is negotiating with the problems surrounding them. Those problems are generally related to industries which contain the lowest-wage earners in the country, and they create very great difficulty.

The proposals on the wages councils as contained in Clauses 79 to 84 are on the whole most welcome. They represent the first major improvement in wages council machinery and scope for half a century. This may well be the significant breakthrough in the eventual elimination of scandalously low-paid workers in whole sections of industry.

One reason for the laggardly progress in the wages council sector has been the long gaps between settlements. Proposals in Schedule 6 and Clause 79 to speed up the procedure by asking the Secretary of State to sanction orders is a major step in the right direction. In the past the lengthy, cumbersome procedure of wages councils has held up awards in many instances by 15 months or more with the delay between the application being made and the order being issued to notify the increase. The wages council sectors have fallen increasingly behind the increases in pay in the regular round of increases in the collective bargaining sector.

Another inhibition has been the lack of bonus schemes and plus payments in the wages council sector. The widening of the scope of the councils as contained in Schedule 6 also refers to these differences between the wages council sector and negotiated areas. Orders under the new legislation specify all terms and conditions, not just the basic wages, hours and holidays, and will enable the wages councils to close the earnings gap which has arisen between these industries. I share some of the feeling and some of the disappointment expressed by the hon. Member for Rochdale (Mr. Smith) that there has been no defined minimum wage, but this kind of legislation will help to put up the unofficial minimum wage which already exists.

Little will happen automatically without the organisation and development of bargaining and trade union membership in these areas. The interim stage between wages councils and free collective bargaining is now established by the statutory joint industrial councils in Clause 80 and 81. These follow very closely the proposals put to the Department by the employee-representative groups. However, the proposals and the functions specified do not go far enough. First, the SJICs should have powers to negotiate terms and conditions which are not statutorily enforceable like wages council orders. This will enable an agreement to be reached on an SJIC on a wider range of matters than before, but with the force of an ordinary collective agreement rather than a statutory imposition. I believe that this will make agreement easier and will ease the way to the translation of the SJICs into entirely voluntary collective bargaining bodies.

Secondly, the SJICs should have specifically as one of their functions the encouragement of voluntarly collective bargaining, and on establishment should have a limited life of three to five years extendable by the Secretary of State if he can see that the progress towards voluntary collective bargaining is not proceeding sufficiently well. The SJICs should also have the duty to report annually on their progress.

Thirdly, in those sectors where organisation and the development of voluntary collective bargaining is difficult and a long way off the penalties for ignoring wages council orders, or the SJIC orders, should be higher than at present. The maximum fine of £400 is insufficient. At least the persistent offender should be subject to higher penalties. More important, however, is the policing of the system and the imposition of penalties. In the short term the wages council inspectorate needs to be strengthened and the number of prosecutions should be increased. In 1972, the latest year for which I have figures, 11,000 substantive cases of breach of pay or holiday orders were established, yet only one case was brought. This is ludicrous.

In those areas where we still need statutory controls to avoid exploitation the means of enforcement must be effective and credible. In this area the legislation should explicitly provide for wages councils to cover, or be established to cover and make orders to cover, home-workers or outworkers. These are two of the most exploited groups in industry at the present time.

For the reasons that I have outlined I believe that there is nothing in the Bill to fear. If both sides of industry give it their concerted support and back the ideals embodied in the Bill, I am sure that it will come to be regarded as the foundation of good, forward-looking industrial relations.

5.50 p.m.

Mr. Esmond Bulmer (Kidderminster)

Every hon. Member is deeply concerned about the present employment position. As an employer, I suggest that if current rates of inflation are maintained, the outlook is potentially catastrophic. I believe that we all wish to look carefully at a Bill that promises any improvement in the employment situation. I have looked carefully at this, and I have found it wanting in its strategy, timing and much of its emphasis.

Clearly, the Bill seeks to protect employment by giving greater powers to trades unions. We are all aware of areas where the power of trades unions is too great, too great for their own good. One of the most dispiriting features of the Government's attitude to the social contract is that they continually give, give, give without showing that anything is obtained in return.

The Government have an important position as umpire. When society has a body that is too strong for the constitution, as some trades unions now are, it is necessary for the Government to act as a check, or even as a balance, and not to give added emphasis to that monopoly, which is what the Government are now doing. Otherwise the result will be that trades unionists will price themselves out of the market, as they are now clearly doing on the railways, in the Post Office and soon, I am afraid, in the steel and motor car industries. None of us wants that, but it will happen if the Government do not have the guts to stand up and resist.

We all wish to protect employment, and to do that we have to engender a totally new attitude. It must be understood that to keep a job men must be prepared to change it. I had thought that the Minister would say more than he did about retraining and monitoring obsolescence through the "little Neddies".

I should like to refer to manpower strategy. People feel it to be a stigma if they lose a job, but there should be a recognition that they are doing what society wants and they should be enabled to move house more easily and to transfer mortgages and pensions, and so on. Those are difficult problems, but they are the way to improve job prospects for everybody.

Unfortunately, far too much union thinking is still directed to maintaining the status quo. In the light of union history, that is understandable. But is it not suicidal for the Ford workers to be working more slowly than they can do in order to protect their jobs? Clearly, they will lose and the nation will lose.

It now seems to be axiomatic that nobody in the public sector should lose his job. The Bill seems to seek to extend that principle to the private sector. We must have greater mobility of labour, and to the extent that the Bill prevents that mobility it is not in the national interest. I would go so far as to say that labour hoarding in the nationalised industries, particularly over the past 10 years, has played a major part in investment failure, because far too often industries have found bottlenecks caused by the lack of skilled labour, or even of people to train.

My second criticism of the Bill is that its timing is wrong. It will plainly place upon industry burdens, burdens disproportionate between a company that employs many women and a company that does not, between a small company and a large company. I hope that the Government will assure us that increases in costs resulting from the Bill will be treated as allowable by the Price Commission. If they are, is this the right time to borrow money from companies and hand it back? Are we justified in transferring these charges from the State to the employer?

In my constituency one of the largest companies is having to cut the number of people it employs because of the operations of the Price Commission. I would guess that as a general rule the result of the work of the Price Commission is to reduce the number of jobs by between 5 and 10 per cent., and it would be interesting to have the Government's assessment.

We all know that inflation of 20 or 30 per cent. makes company forward planning impossible. This is at the heart of the terrifying prospect for unemployment. We all know that shareholders are being penalised. Of the income available to all companies, 6 per cent. goes to shareholders. This is at a time when one union is said to be claiming 50 per cent. If everything received by the shareholders went to salaries and wages, wages and salaries would be increased by only 6 per cent.

When there are wage claims of 50 per cent., is it surprising that there is not the money we want coming forward for productive enterprises? What is the effect on morale in industry of the activities of the Secretary of State for Industry, who is undermining the whole basis of industrial discipline by refusing to allow the forces of the market to work?

We all know that management is snowed under with legislation. This will be another measure on top of the two, three, four, five or six measures already on the desks of managers at a time when they are deeply worried about their ability to keep their companies going in the market place. The Government must give some thought to the effect of this legislation on managerial ability to run companies and to provide the necessary leadership.

There is one subject that has not been mentioned, but it is desperately important. If the market is not allowed to operate, the moderate and sensible trade union leader cannot get across to his membership the facts of his long-term interests. We are all familiar with the shop steward who says "I knew that 16 per cent. was the right figure, but the lads would not have it. They told me to come back and get 30 per cent." So research is cut and so investment is cut.

Mr. Litterick

Is the hon. Member aware that the British worker is now among the lowest paid in Europe and is the cheapest labour in Europe? Is he suggesting that labour should be even cheaper and that wages should be even lower?

Mr. Bulmer

No, I am not suggesting that at all. I am saying that if wages exceed productivity there will be fewer jobs. We all want greater productivity and larger wages, but they must be related.

Mr. Litterick

As in agriculture?

Mr. Bulmer

I shall come to agriculture in a moment.

My third criticism concerns emphasis. Clearly the Bill is biased. The hon. Member for Newton (Mr. Evans) spoke of management co-operation. Does he think that the right way to get management co-operation is to produce a Bill that is totally one-sided? I do not need to spell out the evidence of this bias.

My right hon. Friend the Member for Lowestoft (Mr. Prior) mentioned the composition of ACAS. It cannot be effective if it is biased. Clearly, there will be member companies in the CBI which, if they see codes of practice emanating from the ACAS that are totally one-sided, will want to withdraw, just as the trade unions objected to the Conservative Industrial Relations Act 1971.

It is reasonable to ask: why cannot employers refer inter-union disputes? Why should not union members be protected from union abuse? Contrast the situation of the man who is unfairly dismissed from a company and the man unfairly expelled from a trade union. If he is unfairly dismissed from his company his pay is preserved. He appears before a court and has judgment delivered to him. The Press can be present and he has a fair hearing which is obvious to all.

If he is unfairly expelled from his trade union he may not be able to get a job. His income is not protected. He has to wait for union procedures to be exhausted and then he has to wait for judgment through the union machinery. There is no Press access and no written judgment. That seems to be something upon which the Minister might reflect.

Sooner or later if free institutions are to survive the unions will have to accept settlements by arbitration and not by strikes. What would have happened if the miners had bankrupted Leyland? How long would it be before the national interest was admitted?

I turn to the problem of small businesses.

Mr. Litterick

I thought the hon. Gentleman was going to talk about agriculture.

Mr. Bulmer

Most of farming, but not all of it, is comprised of small businesses. There are 800,000 small businesses, many of them facing bankruptcy. If each one employed one person fewer the unemployment figure would double I do not believe the Bill begins to recognise the difficulties facing small businesses.

A farmer cannot take on a nine-month or 12-month temporary. Supposing a farmer is employing three people and one of them wants to become a magistrate. Should that farmer not be allowed to say that if that is the case he cannot afford to employ another person temporarily and that the person who wishes to become a magistrate must find another job? Is that so unreasonable? Clearly, there are small businesses which do not pay the rate for the job. But it is the question of a job or nothing.

The guarantee provisions would clearly be unworkable in the event of power shortages during a national emergency. The farmer clearly has special problems with seasonal workers. The current resentment among farmers about the way they are being treated by the Government is enormous. There are many Labour Members who do not perhaps know a lot about farming. But they know a good deal about Russian history.

I give a word of welcome to sonic parts of the Bill. It is clearly right that disclosure should be extended. We cannot expect employees to behave responsibly if they do not understand the implications of their actions. The more that people understand the way in which their future is bound up with the success of an enterprise the better it will be for the company and the country.

This Bill has been introduced by a Government who look increasingly like a committee of the TUC. I do not believe that the Bill has done justice to the attitudes of the trade union movement. All the criticisms that the Labour Party threw at us can be returned. The Bill is totally biased. It replaces collective bargaining with the law. It will produce results quite different from those intended. It is certain that fewer women will be employed. We have only to look at what happened in Italy to confirm that.

The guarantee provisions will lead to more employment of "lump" labour in the building industry. The job prospects for the less-well-endowed will collapse. To deserve the benefits of this Bill trade unionists must show that they can deliver, and it would have been nice to have heard from the Minister about some developments aimed at reducing the number of unions and bargaining points, about education to meet new responsibilities. We all want to see security at work, but this must be done through flexibility and not through measures which preserve the status quo. If the Government wish to preserve employment they must drop their vendetta against private enterprise and restore freedom of action to those who can get the country out of the mess it is in.

6.5 p.m.

Mr. Robin Corbett (Hemel Hempstead)

Thank you for calling me, Mr. Speaker.

Mr. Deputy Speaker

Order. The hon. Gentleman is the fourth to address me as "Mr. Speaker." Like the corporal who is called "Sergeant", I have no objection, but for the sake of the record I am Mr. Deputy Speaker.

Mr. Corbett

I apologise, Mr. Deputy Speaker.

Before I came to this place I was for many years an honorary trade union official. I was one of those dreaded shop stewards. I served for five years on the national executive council of my union, and, if that does not raise cheers, perhaps I should mention that for the last four years of my working experience, in that context I was senior labour adviser with a major publishing group which had a printing involvement. I mention this because it is fair to say that people theorise about this subject, inside and outside the House.

At times this afternoon we have heard people mistaking the aims of this Bill and suggesting that it bestows benefits upon trade unions—putting them into one camp and the employers into another. It is my case that the whole merit of the Bill is that it talks about improving relations between people at work without tying labels on them. As long as we, on any side, perpetuate this feeling that industry is divided into camps which are permanently at war we shall get destructive attitudes across industry and commerce.

In a sense it is a pity that the Bill has been brought forward at all because it is sad commentary on what has happened over successive generations. There has been an appalling waste of people at work. We talk of human resources. One criticism which can be levelled across industry is that it has not taken enough care of people who invest their skills and talents in their jobs. When most people go to work they leave their democratic rights on the pavement. Businesses can and do close down literally at an hour's notice. The livelihoods of men and women in small and large businesses can be and are jeopardised without a word of consultation or even warning. It can and does happen. My hon. Friend the Member for Bury and Radcliffe (Mr. White) mentioned a case in his constituency. It happened in mine a few weeks ago when literally at an hour's notice on a Friday afternoon the 30 employees got a note from the boss saying "Thank you. Goodbye. I am shutting up shop." We should examine relations between people at work—

Mr. David Mitchell

Can the hon. Gentleman tell the House the extent to which financial difficulties caused that employer to close in that way and to what extent the Chancellor's measures were responsible?

Mr. Corbett

The hon. Member tempts me to make comments about the firm concerned. My point is that, whatever the reason for this firm closing down, it is not good enough to give people one hour's notice. There were all sorts of reasons for that firm closing. If it makes the hon. Gentleman any happier—I do not think it will—the closure took place long before the Chancellor announced his Budget.

We should acknowledge the pioneering work which has been done over the years to try to improve relations between people at work by such independent bodies as the Industrial Society and St. George's House at Windsor. The fact remains that there is an inadequate sharing of responsibility between people at work and an imbalance of rights. A white-collar worker can have "office 'flu" without loss of pay. She can have a baby on full or part pay. By and large, people on the shop floor—those to whom we look for help with production and productivity—get no such treatment. There is as much inequality and unfairness between groups of people at work as there is between work people generally and management. In negotiations, management generally holds all the informa- tion aces and then accuses trade unions of not caring about the state of the business.

The pattern of negotiation could, as it must, change within a fairly short time under the Bill. For example, we can end the horror—that is what it is—of instant redundancy and place on management the duty to provide full information, and similarly for collective bargaining purposes. It is my view, and certainly my experience, that the sharing of relevant information about the state of a business can and does lead to better understanding around the negotiating table. But the achievement of that understanding during negotiations is progress. It is no longer good enough simply for management to say to people with whom it is negotiating "That is the position because I say so".

Information about the state of a business should be shared, and indeed is shared in many of the better-run commercial and industrial firms. There will still be disagreement, but the area of conflict is narrowed when information is shared and made available, because the facts are known and, hopefully, understood. The argument then arises on the judgment made on the basis of that information.

Does it not in many instances come down to a matter of trust? Trust between people at work is a two-way matter. There is far too little trust. The more information is shared, the more that trust is earned, the better the chance of improving the relationship between people at work. By and large, power rests with the people who hold that information. The power must be shared if there is to be a lasting improvement in good industrial relations practice. I should have thought that every hon. Member would agree that a monopoly of information sowed the seeds of industrial discontent and allowed rumour-mongers, for whatever end, to have a field day.

Where that information is not shared, the only räle given to people at work—often it is given not simply to trade unions but to people at work who may or may not be members of trade unions —is to say, "I do not believe you" and then to go on to say "No, I do not like it." The power left to people at work is essentially the power to say "No", and then to go on to throw stones through the greenhouse window. It may be a very satisfying short-term pastime, but, through management's unawareness, it has become elevated into a sophisticated daily skill.

If that is the major and, in instances, the only räle which our present system allows, we should not be surprised if it is increasingly well played by people at work. In my view, the Bill can start to change that situation by unlocking the information safe, by sharing the information, and so enabling and encouraging people at work to know more about what is going on and how they and the firm in which they have invested their skills and talents are doing.

How often in industry do we hear people say "I must be doing all right because the boss has not spoken to me for six months "? That is very common in industry and in commerce. In many instances, the only time people hear from the boss is when they have dropped a brick, because they are so busy. Far too many managers pay far too little attention to the fact that people do not work only, or even mainly, for money. The contribution they make to the success of an enterprise needs and deserves to be recognised. It is my view, and again my experience, that people are more ready to accept the sort of change mentioned by the Opposition when they understand. They will understand better when they are told more. Conversely, the less they are told the more obdurate they will remain or become.

I acknowledge that in the Bill there is some challenge to management which sensible management will welcome. The challenge is that, with more information being provided, people at work at other levels in a business will be better able to judge how the management is managing. I see nothing wrong in, and a lot to be gained from, people at work being able to say to their managers "Your skills are different from mine. But you must manage well because my job and livelihood depend on the skill and sensitivity of your management." A man at a lathe must show that he is up to the job in terms of the number or quality, or both, of what he is producing. Why should not a similar onus be put on managers and management generally?

I turn to the question of cost. This is a worry, and I am sure that the Minister acknowledges it. Some additional cost will result from the Bill's provisions on maternity leave, the right to redundancy pay, guarantee payments and others. But is not this precisely the time when we should encourage industry to make an investment in people? We all know how necessary is investment in manufacturing in particular. Is there not a much greater need for investment in the people who work the machines? Should we not assert at every level of the argument the prime importance of putting people before machines?

The skill and success of a manager comes not out of a machine but out of the way in which he leads the people working with him. If industry generally cared more for the people who worked in it, would not this hold the promise, with the investment needed in re-equipping and modernising, of unlocking the skills, talents and enthusiasm of people at work which have been squandered or allowed to lay dormant for far too long?

If we want a reminder of that, we need only turn to the Ryder Report on British Leyland, in which Sir Don Ryder acknowledges the willingness and enthusiasm of people at every level in British Leyland to help to get the firm back on its feet. The tragedy is that the present management and previous managements have not found a way of translating this enthusiasm and interest into productive outlets.

Those who say "This is all very well, but it cannot be afforded" are opting for continuing the situation in which in too many areas industry remains a battleground. The Bill gives industry the opportunity to show that it cares about those whom it employes and it will enable those who go to work to play a much fuller and more constructive räle. It promises a new and changed partnership with a balance of rights which will enable responsibilities for success to be shared. This is an exciting challenge, and it is why the Bill is so important.

6.18 p.m.

Mr. Douglas Henderson (Aberdeenshire, East)

It has been valuable to hear of the experience in industry of the hon. Member for Hemel Hempstead (Mr. Corbett) and to hear from someone with a background of understanding of the problem. I agree with the hon. Gentleman that far too many companies have underestimated the importance of the use of personnel and the question of industrial and human relations in all the other things that they do. The story told earlier of the company in which the managing director had taken an important decision and had not consulted those with direct access to people in personnel is perhaps all too prevalent

Despite the fact that there is continual debate about the central importance of industrial relations, and newspapers, radio and television constantly harp on it, fat too few companies have done what is needed to be done to correct the situation. The changes taking place in industry and commerce have been affected by the changes which have been taking place in technology for a long time.

Those of us who have worked in industry know how technology has altered the traditional attitude to payment systems and skills. Many people in industry now feel threatened, because traditional skills —for which they served apprenticeships, and which they felt sure would be used for a long time—are now undermined by the introduction of a machine which someone can be taught to use within a matter of weeks or, at the most, months. In the eyes of a company, the output of the machine operator is more important than the output of a man who has acquired an inherited skill.

The size of businesses has been referred to. Hon. Members have talked, with justification, about small businesses. At the other end of the scale there is a growing concentration of industrial power in fewer and fewer hands, such as large combines and the multinationals. In many industries, individuals who previously worked for a company which they understood and to which they had certain company loyalty now find that they are working for an amorphous group, in circumstances in which a man in Detroit can sign a piece of paper which will put 2,000 people in Dundee out of work overnight. These are the sorts of things that concern people. Do we wonder that we have poor industrial relations? People feel threatened by such conditions.

One of the most outstanding American industrial psychologists described individuals in such organisations as follows:

  1. "1. They have minimum control over the working world;
  2. 2. They are expected to be passive, dependent and subordinate;
  3. 3. They are expected to have a short time perspective;
  4. 4. They are induced to perfect limited range of abilities;
  5. 5. They are expected to produce under conditions leading to psychological failure."
That may be regarded by some people as an extreme description of the situation. All of us who have worked in industry know that many of these propositions are at least recognisable and that there are signs of them everywhere. People develop certain defences against them. There are the escape from reality and the psychosomatic illnesses. In the boardroom they are known as ulcers, but if we are humble enough to work on the shop floor it is backache or headache. There is apathy and non-involvement, which are manifested in, for example, delays and work stoppages.

I hope that the Bill will tackle the problem of tribal practices which bedevil so much of industry today and which were briefly referred to by the hon. Member for Hemel Hemptstead. I refer to the division between people on the staff pay roll and people who are hourly-paid. It a girl who works on the shop floor wants to go to the hairdresser she has to take a morning off and lose a morning's pay. If she worked on the staff she would be able to take the morning off. She might get a black look, but that is all that would be done about it. No one can defend or justify this. I hope that it is the sort of thing we are trying to get away from. We want everyone in a company to receive the same consideration. We want to build up a situation in which we have an all-through payment system from the top to the bottom, and an all-through common benefit system.

I am particularly concerned with redundancies, because in Scotland we have probably suffered more than our fair share of them. Scotland is especially vulnerable, with the number of branch factories in which ownership and control are vested in people outside Scotland—people who can take decisions that affect the lives and livelihoods of hundreds of thousands of Scottish people. I hope that the improved conditions provided by the Bill will act as a check on the arbitrary use of this power to reduce at a stroke the living standards of Scottish people.

During the Easter Recess I took the opportunity to have a meeting with all the major employers in my constituency to discuss the Bill. Certain points were brought to my attention, and I hope that they will be answered now or in Committee. There seems to be a problem about the redundancy provision in respect of seasonal industries. There are certain industries, especially in the food trade, in which people are employed for a seasonal period of perhaps three months. I was asked, "If you have to give 90 days' notice does that mean that immediately you take a person on you have to give him 90 days' notice that he will not be required at the end of that period?" I hope that that point can be cleared up by the Minister.

The Minister of State was right to agree that there are special problems with small businesses. I would not go as far as the right hon. Member for Lowestoft (Mr. Prior), who described small businesses as those employing 100 people or fewer. That is a rather general and elastic use of the term. There are certainly small businesses which would suffer from, for example, the provision of reinstatement after pregnancy. There may be only two girls in an office, and if one leaves and is away for a year it may be impossible to carry on the business with one girl in the expectation that the other will come back later. I hope that other hon. Members, while wanting to protect the interests of the person who leaves, will also he sensible about the problem.

Another problem is the difficulty that small businesses will encounter in understanding the Bill and the amount of legislation going through the House. We should not underestimate the problem for businesses which cannot employ personnel specialists and the other people who are so influential these days. Something special must be done for them to make sure that the provisions of this legislation are digested, understood and implemented. Clearly the small business man is getting on with his job, and he does not have the time, any more than many hon. Members do, to read the mass of legislation which is pouring out from the Government.

On Schedule 10, clarification is desirable in relation to the averaging of wages in particular areas. It is not clear to me what is meant by an average wage for a district, or the district average. Does it apply to employment exchange districts or regional planning area districts'? To what districts does it apply? How is it to be worked out? Let us take as an example the job of a clerk. A clerk in one company may do a certain type of job, but a clerk in another company may have a much more responsible job. If we talk about an average wage, how shall we make sure that we are comparing like with like across a different range of companies, perhaps with different organisations, different job structures and different job definitions? Is it implied that there will be a kind of super-job evaluation for each district, so that people are slotted into certain grades? How does the Minister intend this provision to be implemented? How will it affect the people concerned? We are entitled to an answer, if not today, certainly in Committee.

We must be careful not to promise too much in any legislation of this type. We should recognise that the law cannot do everything for everyone. 'There are some people who go around looking for simple solutions to what are essentially difficult and complex problems. [AnHON. MEMBER: "Or the other way around."] I make no comment. This is a difficult problem, and it must be approached with a great sense of flexibility and humility by all hon. Members.

This Bill and the Industry Bill will place a tremendous onus on trade unions. I was delighted to hear that the Transport and General Workers' Union is engaged in a massive new educational programme with new facilities. Let no one underestimate the problems for the trade unions, and especially for those strange and exotic beings such as the hon. Member for Hemel Hempstead referred to—the shop stewards. They are the key men. A great programme will have to be undertaken. When I spoke to the employers in my constituency I also spoke to most of the shop stewards in the major companies. I asked them what provisions the trade unions were making to ensure that they would be informed and able to use the information they were given. The response was a little vague. Those involved must make sure that the trade unions respond, and use the information responsibly.

I hope that in Committee the Government will show a sense of conciliation, in the terms of the Bill, towards reasonable amendments. My hon. Friends and I will support the Government on Second Reading.

6.30 p.m.

Mr. J. M. Craigen (Glasgow, Maryhill)

I welcome any Bill that seeks to improve industrial relations practice. I believe that this Bill will not prove so formidable to many of the progressive employers who already put into practice some of its provisions, but it is a highly complex and comprehensive legislative package. I only hope that the good intentions that bind it together will be strong enough to bear its full weight.

I fear that unless we can improve the economic climate the Bill's objectives will fall flat on their face. We are dependent on a better industrial and economic climate to fulfil this latest stage of the social contract. That is especially true of Part IV, dealing with the vexed problem of redundancy.

The Bill is right to have, as Part I, the whole topic of improving industrial relations. It is a welcome step forward to give statutory status to the Advisory, Conciliation and Arbitration Service. Many of us have placed high hopes on the service. We look to it to help to provide an antidote to the general poison that crept into industrial relations in the early 1970s. There is a great yearning throughout the country for a bit of peace and quiet on the industrial relations front.

We must start to emphasise the positive side of industrial relations. We live in an upside-down world when we can get as many figures as we like about the number of days lost through industrial dispute but no one seems able to tell us the number of days actually worked in Britain. I am told that in ancient times the Chinese paid their doctor when they were well and stopped paying him when they were unwell. That practice might well be followed with good effect in the whole area of industrial relations.

There is no doubt that working people are becoming somewhat immune to the inconvenience of industrial disputes. It is as though we were inoculated against the actions of our fellow men and women. As we extend the public sector everyone will, more or less, be every one else's boss. That means that we must rethink the way in which we organise our industrial relations.

The television and the Press will have to start laying off industrial relations. To some extent these media have become the biggest auctioneers in the business of the whole wages spiral. The differential problem in industry is very big and tricky. I should like to hear a little more about what the Royal Commission on the distribution of incomes is up to. It has been very quiet recently. Equality of reward will be a vital area for those involved in industrial relations. I hope that the Advisory, Conciliation and Arbitration Service will be able to bring to bear a considerable amount of experience and good will. I urge my hon. Friend the Minister to strengthen the Scottish dimension of the service.

I turn to Part IV, dealing with redundancies. A great deal of our economic planning is done by the Treasury. At times, it seems as though the ghost of Sir Stafford Cripps is still walking the corridors of Whitehall and that we are still whispering about the problem of manpower, retraining and job creation. One can consult a man as much as one likes when telling him that he will be redundant, but at the end of the day he gets his P45. Bringing new jobs to Scotland and other parts of the United Kingdom is vital.

My hon. Friend also has a responsibility for employment and training. I believe that he could not do better than to give the industrial training boards a nudge to recruit and employ young people for apprenticeships. It would be a helpful start in meeting the considerable problem which will arise for young people looking for work.

I question my hon. Friend about the state of the Redundancy Fund. I believe that it is now out of deficit, but as far as I can discover it was in deficit to the tune of £10.1 million in 1971–72. In the present economic situation, there is a certain air of unreality about an over-concentration on consultation and possibly not enough emphasis on being able to carry the burdens which will result from firms closing. if the Bill is to be a worker's charter, the payment of wages and accrued holiday entitlement should be a prior debt when a company becomes insolvent.

Is the code of conduct to be binding? Trade union officers often rely on a code of conduct, but if, when they say "We abided by the code", they are to be told "The code is meaningless in legal terms", little legal backing will be given to those who seek to abide by the code.

I wonder whether the time has arrived when we should be giving working people legal aid when they appear before tribunals. Unions are sometimes inadequately staffed for the purpose, or the trade union officer concerned may feel that the case is not strong. Some people, regrettably, are not members of a trade union. The problem of appearing before a tribunal is one of seeking reparation, not representation. There may well be a case for considering legal advice and representation.

I confess to a certain puzzlement over the arrangements for women leaving employment as a result of pregnancy, and over the position in which the temporary worker will be placed. Unless it is clearly stated in writing that he is only temporary, I can see formidable difficulties. I can envisage employers playing musical chairs with some employees to get them out of the door. The terms should be in writing. I also find it somewhat puzzling, in this day of opposition to sex discrimination, that Clause 45 provides that the person who will be put out of a job when the woman returns is a male, because it says: his employment will be terminated. I broadly welcome the Bill, though I have no doubt that changes will be made. In some respects it is misnamed. It would have been more appropriately entitled "Improved Practice in Industrial Relations Bill". The only way to protect or safeguard peoples' employment is by motivating those who work in industry by removing much of the dissatisfaction which exists and by ending the private investment strike which has greatly weakened British industry since long before the war.

6.40 p.m.

Mr. Kenneth Baker (St. Marylebone)

The hon. Member for Glasgow, Mary-hill (Mr. Craigen) made some interesting observations in his forthright speech, which characterised the somewhat strange nature of the debate. Listening to all the speeches, as I have, at times I hardly believed that Government supporters were debating the Bill that we are debating. Government supporters looked upon the Bill as improving industrial relations, as many of the proposals do, and in doing so looked at it narrowly, whereas most Opposition speakers, including the spokesman for the Liberal Party and to some extent the spokesman for the Scottish National Party, looked at the broader political implications of the Bill. If the Secretary of State for Employment had been with us today and not, unfortunately, in hospital, we should have seen at an earlier stage from the Government benches the political cutting edge of the Bill.

As the Minister of State said, the Bill is an integral and essential part of the social contract. My colleagues and I contend that, taken with two or three other measures which are now before Parliament, it substantially increases the influence, status and power of organised trade unions. Labour back benchers, above or below the Gangway, cannot reproach their Government for not fulfilling that part of the manifesto, particularly the phrase which refers to bringing about— a fundamental and irreversible shift in the balance of wealth and power in favour of working people and their families". [HON. MEMBERS: "Hear, hear."] Before hon. Gentlemen cheer, I hope that they will bear in mind that many right hon. and hon. Members of all parties and a vast number of people outside the House do not find the phrase "working people and their families" entirely synonymous with organised trade unions.

It would be idle to deny that a fundamental shift of power has taken place in our society in favour of organised trade unions. They have been the most dominant force in the past six years of the political history of our country. In 1969 the TUC and certain unions made the Labour Prime Minister of the day withdraw a measure which was considered to be fundamental. They took the Prime Minister's scalp. In 1974 they took the scalp of a Conservative Prime Minister, and for the past year they have been determining the Government's economic policy. The interesting issue over the next six months in the economic and political history of Britain is whether Treasury orthodoxy, as personified by the Chancellor of the Exchequer, will win out against the trade unions—

Mr. John Biffen (Oswestry)

It will win hands down

Mr. Baker

My hon. Friend says that the Treasury will win hands down, but I shall not be so rash as to predict who will win. All I know is that the battle will be bloody.

Our contention—it is proven by the measures which are now before Parliament—is that there has been a substantial shift in the balance of power in favour of organised trade unions. The Trade Union and Labour Relations (Amendment) Bill has considerably increased the power of trade unions to maintain or impose post-entry closed shops. The Industry Bill is in Commit. tee and, therefore, I shall not dilate upon it, other than to say that in its disclosure provisions the channel of communication of disclosure from a company is not to its employees but to trade unions. I am in favour of the disclosure of information. In businesses with which I have been concerned in the past I have been an advocate of disclosure and have tried to practise it, but the disclosure provisions in the Bill provide that the only channel of statutory communication between an employer and his work force is through trade union officials, who may not even be employees of the company. That provision conveys a considerable privilege to trade unions, and over the years, in certain circumstances, it will lead to increased powers.

Mr. Litterick

Is the hon. Gentleman aware that in British industry it is a not uncommon practice for employers deliberately to choose to communicate through professional trade union officials rather than direct to their own employees through lay representatives?

Mr. Baker

The hon. Gentleman is right. A company which I advise does that, but that demonstrates the variety of the methods of communication. What I am opposed to is the Bill's statutory enforcement of only one method when there are many.

The Bill which we are discussing, as the hon. Member for Rochdale (Mr. Smith) said, considerably enhances the power of organised trade unions, sometimes at the expense of employers and sometimes at the expense of non-unionised employees.

Clause 11 allows trade unions but not employers to refer recognition disputes to the ACAS. That is a clear bias, which is totally unsatisfactory. I do not object to the principle of the guarantee payments covered by Clause 22, but how unfair it is to penalise a company that has to make these payments because of an industrial dispute in another company. That is a matter which we shall have to debate in Committee. In certain circumstances, that provision could increase the temptation to take industrial action. Again, it is an example of bias.

No one can claim that the Government are not fulfilling their side of the social contract. Some trade union officials to whom I have spoken can scarcely believe that they are getting so much from the Government. Their powers have been substantially increased by these three measures, and the attraction of joining a union, therefore, has been substantially increased.

What has been offered in return? The country was told that there would be some collective responsibility, some measure of income moderation—I will not even call it wage restraint—but we have seen nothing of that, as several of my hon. and right hon. Friends have said. All we know is that when a union puts in a claim for over 30 per cent. Mr. Len Murray talks to the general secretary of the union. Only last week I read that Mr. Len Murray had carpeted Mr. Buckton. Being carpeted by Mr. Murray is rather like being sentenced to death by being pelted with powder puffs, because he has no power over the constituent members of the TUC.

In the two elections last year the country was persuaded that there was real bite in the union side of the social contract. If the powers in these three measures are being conveyed, we have a right to ask what is being given in exchange. The country is entitled to expect that one of the great estates of the land should conduct itself responsibly. It is a measure of considerable regret that that has not happened.

I read recently of a comment by Lord Houghton, the former Chairman of the Parliamentary Labour Party who, before coming to the House, spent the greater part of his working life as an active trade union official in a civil service union. He said: The unions have not yet summoned enough moral and institutional strength to govern themselves wisely and with tolerance. When these powers are being conveyed in statutory form by the three measures I have mentioned, the Opposition, speaking for many millions of people, have a right to ask what is being given in exchange.

Mr. David Mitchell

My hon. Friend has suggested that Mr. Len Murray has no power to enforce his side of the social contract. Does my hon. Friend recall that when the Industrial Relations Act was passing through the House the General Secretary of the TUC appeared to have considerable powers, which presumably he still has if he cares to use them?

Mr. Baker

I think that my hon. Friend makes a valid point. TUC approval is rather like an electric current that is switched on when it is needed and switched off when it is not needed. It is now switched off completely.

It is clear that the main priority of the Government is job preservation. That is what Mr. Len Murray said yesterday and that is why the Government have introduced support amounting to £2.8 billion for British Leyland. That is why they have supported the three co-operatives at Meriden, Glasgow and Kirkby. That is why the Bill is called the Employment Protection Bill. It is clear that job preservation is the Government's first priority. This Bill makes it much more difficult for employers to sack or lay off people.

I appreciate the deep anxiety about unemployment that is felt by many people in industrial firms throughout the country. I appreciate the feeling of many working people that their livelihoods arc subject to forces completely beyond their control. They feel this whether they work for a multinational company or a British company. They feel anxious and apprehensive. If the Government have job preservation as their first priority, and if that job preservation is applied at all costs, it will in the short term, turn out to be the enemy of expanding job opportunities in the long term.

I am most anxious that for the best of all possible reasons—the prevention of unemployment—procedures will be set up that will make it almost impossible for some companies and industries to make the necessary changes; to respond to the inevitability of industrial change; to deal with overmanning and poor productivity. All those measures are bound to lead to a reduction in jobs. My hon. Friend the Member for Kidderminster (Mr. Bulmer) referred to them as a consolidation of the status quo. The danger for large parts of the United Kingdom's economy is that a job preservation paralysis will set in. A much more imaginative and positive approach is needed.

First, I suggest that the Government should now determine and name those industries or parts of industries that are facing major restructuring as a result of technological change or because of a basic shift in demand for their products. Britain has an unusuaily high proportion of industries in that position. The docks have been mentioned. In addition, there is shipbuilding and part of the printing industry.

When I was responsible for the Stationery Office in the last Conservative Government I appreciated that the restrictive practices of the printing unions, which are some of the most restrictive in the country, came about because of the anxiety of the work force about their job security and about the rapid technological changes in the industry. Such change was not their friend as it was to turn them out of their jobs. I also include parts of the steel industry and parts of the motor vehicle industry.

Secondly, a fund should be established —I shall call it the "Industrial Restructuring Fund "—which would be financed by industry alone. Workers in the designated industries would be eligible to receive payments from that fund well in excess of the normal redundancy payment when they left their employment. That would be paid on the understanding that they did not seek re-employment in the industry.

Thirdly, those ex-employees should be encouraged and paid to be retrained. I welcome the extra expenditure of £50 million in the recent Budget on the Manpower Services Commission. I also pay tribute to the groundwork which was carried out by my right hon. Friend the Member for Carshalton (Mr. Carr) during the last Conservative Government in substantially increasing training and retraining facilities. At the same time there should be substantial mobility grants to allow those workers who decided to leave an industry suffering from restructuring and from a basic fundamental change to be retrained and if necessary to move.

That proposal for an "Industrial Restructuring Fund" is a development of the Jones-Aldington proposals. Those proposals seemed to be much on the right lines for the docks and they need to be developed more widely. The advantage of such a scheme would he, first, that it would have greater realism than the sort of official and unofficial work sharing which will spread throughout British industry over the next two or three years.

Secondly, many people in the industries that I have mentioned would welcome a substantial capital sum and withdrawal from a company which has a limited future. They would welcome retraining in a skill and re-employment in a company with a future.

Thirdly, such a scheme would encourage the necessary changes in our industrial economy rather than delaying them. There are too many handbrakes in this Bill and it will delay a lot of inevitable changes. The scheme that I have put forward would allay the anxiety and fear of many workers who have found that change has not been their ally. In the past change for many working people has meant loss of job security and loss of peace of mind. It would be much better for us as a society to face that situation.

New ideas are needed, but they should not be so defensive as the measures in this Bill and so unrealistic as many of the support activities undertaken by the Government. What we have to do is to find a way of softening the impact of change in our society, that is to say, tempering to some extent the consequence of change which all too frequently and inevitably leads to unemployment. If we do not do that we shall come out of the depression into which we are now moving, very much weaker and with no reserves of strength. If we do not change our fundamental approach we shall be rejecting the possibility of greater prosperity in future. If we do not adopt measures of the sort that I have indicated I believe that we shall be covering more and more of our economy with dustsheets and setting out upon a road which will eventually lead to a museum economy.

6.58 p.m.

Mr. J. W. Rooker (Birmingham, Perry Barr)

I welcome the Bill wholeheartedly. During the Easter Recess I took the opportunity to read it and I must tell my hon. Friend the Under-Secretary of State that I found it a good read. However, there are many drafting errors. If we were singling out for attention the employment of parliamentary draftsmen I think that there would be a good case for booting out a few of them. No one has mentioned one drafting error which makes the Bill provide that on unfair dismissal no one will receive less than £5,200. That is the way that the Bill is drafted at present. I intend to blow a few more whistles before I sit down.

Millions of people will welcome the Bill and the changes that it makes. They will welcome the redundancy procedures and the innovations of guaranteed pay and maternity benefits. There will be benefits for those who are suspended on medical grounds under the Factories Acts. Many people will gain if their companies are declared bankrupt. There are changes in the remedies for unfair dismissal. I am delighted to see that there is a remedy that covers the problem of people who are offered re-engagement but who lose all accrued pension benefits and accrued rights to future redundancy pay because of the technical difference between reinstatement and re-engagement.

All the matters that I have raised so far concern the individual employment contract. They have nothing to do with the questions of how our trade unions are organised and how they operate. There is a good case to be made for legislating separately on matters that concern the individual employment contract so as to keep them separate from trade union matters.

The Bill is our version of the Industrial Relations Act. That has not been said so openly as it should have been by my right hon. and hon. Friends. The measure should be renamed the "Industrial Relations Act 1975" because that is what it is about. I have great fears about the Bill and I am certainly not happy about mixing up individual employment relationships with trade union relationships.

We all know that the Conservative Government's Industrial Relations Act was totally opposed by the trade union movement. Some trade unionists went as far as to refuse to allow their officers to represent workers at tribunals hearing cases of unfair dismissal. Many of the officers disputed that dictum from head office and represented the workers concerned. I foresee a situation in which the present Bill could be used in the same way so that decisions would be made by noble Lords next door poking their noses into industrial relations. I fear that action of that kind will set the trade unions against this legislation. I am fearful of the reaction among the trade unions if the provisions spill over into other areas which have nothing to do with the original intention. In judging relationships between employee and employer we must ensure that people do not suffer in any way from problems relating to collective bargaining.

I am afraid that noble Lords will stick their noses into areas concerning certification of the independence of various trade unions. It is already open for such decisions to be made, in the ultimate, by three Lords of Appeal sitting next door. It is possible to imagine a case going before an industrial tribunal and being heard by a High Court judge and two laymen. That case may be won by the trade union, but, nevertheless, may be appealed against and go before the new appeal body which is to be set up under the Bill. On that occasion it will be heard by another judge, and that again may be taken to appeal. That decision may revert to the original decision in the trade union's favour. One can envisage a system in which nine judges will have examined a case and which it will take a three to two majority next door to settle. In other words, only three judges out of the overall total of nine who have looked at the case will have the final say.

We are here setting up an appeal tribunal which will make crucial decisions in industrial relations, but because of the way in which the Bill is framed there are many cases, particularly those involving certification of the independence of trade unions, which may slip through all the appeal stages to the noble Lords next door. I am not happy about that and I do not know whether the TUC or the unions in general are happy about it.

There is at least one member of the Cabinet who raised this matter in 1963 in connection with the Factories Acts. I refer to the noble Lord, Lord Shepherd, who drew attention to decisions affecting factory safety and dealt with the way in which those matters could be passed up through the various appeal procedures. His point was that what was required was knowledge of what happens on the workshop floor, but in the end the matter fell to be decided by the noble Lords in the other place—people who had never turned their hands to a real day's work in their lives. The noble Lord, Lord Shepherd, raised this matter in 1963 in the other place, and I know that he has been contacted about the procedure provided in the present Bill. It is feared that a terrible situation could arise if decisions on these matters are made next door —[Interruption] These things want spilling and this is the place to do it.

We must change this Bill; we must bring about fundamental alterations. One vital change is that we should have a record of what goes on before industrial tribunals. The notes of chairmen are no good whatever, because an appeal involves matters of fact and of law, and although one cannot go back and prove what was said if no note is made of it, very often the judgment in such cases amounts to two quarto pages of notes which the chairman thought relevant to jot down at the time. Sometimes one does not know who has said what. Therefore, it is crucial that in tribunals there should be arrangements for recordings to be taken of everything said, and for those to be available for people who want to have transcripts.

I take the opposite view from Conservative Members who believe that the Bill is biased in favour of the trade unions. I believe that in many cases the Bill is extremely biased in favour of the employers. Unfortunately, we have not heard much on that score in this debate.

For example, on the question of guaranteed payments, under Clause 23, subsection (1) provides that no payment will be made if a trade dispute is taking place at the time. If we refer to the definition of a trade dispute we find that it covers a lockout under the Trade Union and Labour Relations Act 1974. Clause 23 refers to a trade dispute involving an employer or an "associated employer". That phrase is not defined. Therefore, one does not know whether to read the various pieces of legislation in conjunction in order to understand what is meant. One does not know whether the phrase "associated employer" means an employers' association. That is not abundantly clear.

We know cases in which employers' associations have attempted to set up insurance funds, and where employers, by coughing up money for the funds, have found it possible to opt out of the provisions. If there is a lockout in connection with an associated employer one supposes that would be within the terms of a dispute under the 1974 Act and that it could have the effect of nullifying any guaranteed lay-off payment for workers in another factory. It is tough luck on an employer who will have to pay a guaranteed sum when a dispute occurs elsewhere. Is the situation different as between a lockout and a strike? The provisions appear to be a little biased.

The second example of bias to which I wish to refer occurs in Clause 71 which deals with itemised pay statements. It is surely ludicrous for anybody who has been in industry to be told that there has to be legislation to allow a worker to have an itemised statement in his pay packet showing his deductions, overtime, subscriptions to company clubs, newspaper payments and all the rest of it. Arc we legislating for such a thing in 1975?

The clause states boldly: Every employee shall have the right to be given by his employer… an itemised pay statement …". It appears that there is no power to make such a statement available to anybody over the age of 65. Why should the Bill discriminate against somebody who goes on working after retirement age? There is no policy reason for that whatever. It appears that once again the draftsmen have made another blunder.

The third example of bias relates to deductions by employers in respect of social security benefits which would have been paid to a man who has been sacked. If the worker concerned appears before a tribunal to fight the case on the grounds of unfair dismissal and wins that case and is then re-engaged, the employer is entitled to deduct social security payments. I do not see why taxpayers should be forced to pay for that employer's mismanagement in sacking somebody wrongly and unfairly in the first place. This is another ambiguity which I can only put down to the parliamentary draftsmen.

I should like to deal with the question of insolvency. We all know about the fly-by-night firm with which my hon. Friend the Member for Goole (Dr. Marshall) dealt, and workers' difficulties in getting at the assets. Therefore, it is right that the State should take over responsibility for certain minimum payments. However, there is nothing in the Bill to say that the State should become a preferential creditor in respect of that clawback of cash.

Mr. Booth

If I may help my hon. Friend, the position is that the Bill provides that the fund will stand in exactly the position in which the employee stood before and will line up with other preferential creditors in claims against the assets of the company.

Mr. Rooker

Yes, but, if I am not mistaken, previously employees were always pretty low down the queue for priority. There are certain requirements for taxation and other benefits that go to the top of the queue, but many employees have missed out. Nevertheless, these are points that we must press in Committee.

The last example I want to give of bias towards employers arises in Clause 18 and concerns the confidentiality of information. It is all very well for employers and trade unions to have all the information they need for collective bargaining, but the clause says that the employer does not have to disclose

information if he has received it in confidence. That is much too wide a getout clause for the employer in fulfilling his responsibilities.

The problem of picketing has been adequately covered in a speech by one of my hon. Friends. It must be cleared up in this Bill and cannot be left to another Bill or another court case. We must do away with the unnecessary unrest on this subject. We should grab this opportunity in Committee with both hands and settle this problem once for all.

Many hon. Members have mentioned homeworkers and they are referred to in the Liberal amendment. The amendment says that the low basic limit was promised certain action. I think that I was promised some action in the Bill, as do some of my hon. Friends. The legislation could have been tightened so that we could find out who the homeworkers are.

I should like to refer to the recommendations of two CIR reports. The first one is Report No. 49 on the Pin, Hook and Eye and Snap Fastener Wages Council. Under a chapter headed, "Homeworkers" it says: Our inquiries indicated however that in the pin industry lists lodged with the local authority were far from complete and often inaccurate. Two establishments which we knew employed homeworkers had not lodged a list with the local authority and we found it necessary to approach the companies direct. Even those lists that were lodged were not current, often containing the names of individuals who had long ceased to do homework. The requirement of a lodgers' list is contained in Section 133 of the Factories Act 1961. Under that section, if a list of homeworkers is not lodged twice a year with the local authority there will be a fine of £30. Last year I received a letter from the Under-Secretary saying that on no occasion has there been a record of any employer being taken to court for this.

A later report of the CIR on the clothing industry referred to homeworkers. It said: A recent survey has shown that in 1972 some 13,000 clothing outworkers were registered with the local authorities. This confirms our finding that registration is not comprehensive. Nearly 70 per cent. of the employers of home-workers interviewed employing 59 per cent. of homeworkers working from establishments we visited did not know of the registration procedure and therefore did not comply with it. Therefore, before we do anything about homeworkers we should take some action to enforce the existing legal requirement. It is vital that this section of the Factories Act 1961 is toughened, and it should not be left to the Health and Safety Commission. That will not be good enough. I know that my hon. Friend will seek to strengthen it in Committee.

I welcome the Bill and I shall support the Government tonight. Although I have been critical, I hope that my criticisms have been constructive. They were based on reality, the practice and the evidence brought forward when the Conservative Government presented the Industrial Relations Act. I reinforce the point that we have to do everything possible to amend the Bill so that it keeps the noses of the Law Lords out of industrial relations in this country.

7.14 p.m.

Mr. McCusker (Armagh)

The right hon. Member for Lowestoft (Mr. Prior) said that the Bill had been hastily drafted and the hon. Member for Birmingham, Perry Barr (Mr. Rooker) referred to a number of mistakes which he had found.

I would refer the House to Clause 114. I do not know how long a period has to elapse before it can be said that a Bill has not been hastily drafted. Clause 114 says:

If legislation is passed for purposes similar to the purposes of this Act by the Northern Ireland Assembly the Secretary of State may.… The Northern Ireland Assembly ceased to function 12 months ago. That would render this provision obsolete. It is particularly inappropriate in a week when elections are being held in Northern Ireland to elect people to the Constitutional Convention. However, we welcome the optimism shown by the Government that perhaps we shall have an assembly in the not too distant future.

I give the Bill a qualified welcome on behalf of my Ulster Unionist colleagues, although we regret the necessity for it. We have an honourable tradition in saying that we believe in free collective bargaining. In the eighteenth and nineteenth centuries, when the peasant farmers of Ireland, whether they were planters or of Gaelic origin, were being oppressed by absentee landlords and rent rackets, there grew up in that part of Ireland now known as Northern Ireland what was

called the "Ulster custom". The peasant farmers in that area used to say to their oppressors, "You will not evict us and you will not levy rent upon us. We will not allow you to." They obtained a voluntary agreement that this would not happen and they established a principle which has been carried on for many generations in Northern Ireland.

We were not inflicted with the legislation of the previous Conservative Government and we deprecate the necessity to extend legal processes into areas of dispute, traditionally settled by voluntary means, However—here I agree with the hon. Member for Newton (Mr. Evans)—if in 1975 it is necessary to enshrine in legislation the right for a person to have a written notice of dismissal, a shop steward to have time off for his union activities, an employee to have time to take part in public services and, as the hon. Member for Birmingham, Perry Barr said, an itemised statement of pay, perhaps there are more employers in Great Britain who require to be dragged into the second half of the twentieth century than there are in Northern Ireland. Northern Ireland is ahead of the rest of the United Kingdom on this matter. A leading industrialist told me at the weekend that the Government are casting the Bill at the lowest common denominator of industry in the United Kingdom.

I want to comment on some of the major proposals. I agree with much that has been said by Labour Members. The establishment of an Advisory, Conciliation and Arbitration Service is, to some extent, returning to what the rest of the Kingdom had before it suffered from its IRA. We had our own variety and we felt that we did not require England's variety as well. Because the Industrial Relations Act did not apply to Northern Ireland, during the past four of five years we have developed conciliation and arbitration services similar to those that existed in this country before they were abolished.

I hope that the Minister is aware of the principal recommendations of the tripartite report on industrial relations in Northern Ireland, which was produced last year and which hoped to establish an independent labour relations agency. There has been an impasse in the government of our Province for some time and we have been unable to keep the formation of that agency in the front of our mind. If that agency is established it will keep us in line with the proposals in the Bill. If we had already established it, we should be ahead of England. We are glad to see that Great Britain is getting back into line with Northern Ireland.

I understand the apprehension felt by some employers about the part of the Bill dealing with the disclosure of information. As has been stated by many Labour Members, enlightened employers are already disclosing much of this information through existing channels of joint consultation. I agree with the hon. Member for Hemel Hempstead (Mr. Corbett) that fear of disclosure is another sympton of "them and us". We must get rid of that.

As an educationalist and an industrialist I have learned that, individually or in groups, children or adults tend to live up or live down to the expectations we have of them. If an employer treats the members of his work force as untrustworthy delinquents, he should not be surprised if occasionally they seem to behave that way.

However, I would offer a word of caution to the unions. Do they really want this information? They may find that it will frequently justify the management case. I can remember many instances when, as an industrial engineer, I had the union convener come down with me to check the rate on the job. If I had put in the rate that he recommended, we should have had more problems than we had with the rate that I was putting in. This development brings with it obligations, and I hope that the unions will be prepared to accept their responsibility.

Mr. John Evans

Does the hon. Gentleman not agree that if the disclosure of information would back the management's case, as opposed to that of the unions, it would be an even better argument for disclosure?

Mr. McCusker

I agree completely—to some extent, that is my point—provided that the union official is prepared to act on the information when he is convinced that it is legitimate, honest and given for the correct purposes.

Most progressive and responsible companies already have a system of guaranteed pay. In the past many of these have found this a useful bargaining counter in general wage negotiations. I hope that this will continue and that the Government will be able to extend the provisions of the Bill.

As a production manager, operating some very expensive equipment, I was always amazed at the fact that, although senior managers would immediately shut down a machine if there was the slightest problem with it—although it cost a fortune to have it standing idle while the engineers were in—I frequently had to fight with my foreman and supervisors to get a worker to go to the hospital if he had injured himself. We need to get into British industry the mentality that workers are more important than machines. If a guarantee of a week's wages in a situation over which they have no control is an attempt to do that, I welcome it.

Also, of course. it will bring to the shop floor workers something of the consideration frequently offered to 17-yearold office clerks. I always found it hard to understand why an office worker was frequently entitled to far more consideration than someone who had given 30 or 40 years' hard graft on the shop floor.

The one part of the Bill, however, that I reject completely—the Minister will not be surprised to hear this, having probably read, though not yet heard. my comments in Committee on the Sex Discrimination Bill—is the concept of maternity payments. I welcome the Minister's invitation that there is still room for negotiation. T shall support any attempt to amend this provision. It is no part of an employer's brief to subsidise a couple's decision to have a family.

I agree with the hon. Member for Rochdale (Mr. Smith) that if we want to pay four weeks' wages to a pregnant woman, society should make the payment. Certainly we should not make the woman sign a declaration in order to qualify for that payment that she will return to work after having had her child. At the time of signing she will probably be in no state to know whether or not she will be able to return.

I am old-fashioned enough to believe that a mother's place is in the home, and that if she were watching her children and bringing them up properly we might have fewer delinquency problems of the kind which haunt our country. I do not want a battery reared society, with children brought up like chickens in crêches or nurseries—although I would support any attempt to increase the number of crêches and nurseries because they relieve hard-pressed mothers for a short time when shopping and so on. I do not want to encourage the further growth in the numbers of "latchkey children". This provision in its own small way is another step towards undermining family life.

With that major reservation, I give the Bill a cautious welcome and hope that my colleagues will join me in supporting it in the Lobby tonight.

Several Hon. Members


Mr. Deputy Speaker (Sir Myer Galpern)

Order. The House will be interested to know that the winding up speeches will begin at 9 o'clock, or in roughly one and a half hours. I estimate that about 12 hon. Members still wish to speak. If they could limit their speeches to seven or eight minutes—everything important can be said in that time: I have tried it myself and it has worked successfully—we could accommodate everybody.

7.26 p.m.

Mr. Tom Litterick (Birmingham, Selly Oak)

The main reason why any hon. Member should welcome the Bill is that it is another plea to employers, public and private, to accept that labour is not, and should not be regarded as, a disposable commodity. The sad fact is that through much of our economy that is how labour is still regarded.

It is sad that a great party, the major Opposition party, should be seen to be saying that British employers cannot afford decent conditions for their workers. It is a simple truth that throughout Western Europe employers pay far more for fringe benefits, for what one might call "security of income", than do British employers. We also know, to our embarrassment, that they pay higher wages too. So there appears to be something very wrong with British employers, and it does less than service to the British economy for the Conservative Party to argue that they cannot afford decent conditions on a par with average European practice.

The Bill is a modest step forward to try to protect people from what has been called "future shock"—the shock of change, the devastation of private and domestic lives caused by technological change. Future shock has become almost an endemic disease of advanced societies and the Bill offers some small protection from it. It also offer something which is modest by standard practice throughout the developed world.

Many firms will not readily accept the modest standards outlined in the Bill. They are mainly medium and small firms. In this House pleas have been made on their behalf to the effect that what the Bill demands will put them out of business. This is a self-destructive argument —an example of the British harming themselves again. We must insist that employers who will not voluntarily do so should offer decent conditions and we should put the power of the State behind that insistence.

It is a long-standing tradition of the House and the British State that we wait for years—for decades—until we know just who will volunteer to do the progressive thing. Then the law moves in to take care of the laggards—the people who insist on getting their labour cheap and on employing labour in dangerous conditions. This is our interventionist tradition, and it is that tradition which the Bill follows.

The failure of small and medium businesses is purely a reflection of the weakness of their financial and managerial resources, but it is our fault that we do not make available more co-operative arrangements for providing such businesses with the expertise they need. There are embryo organisations doing this, but the process needs to he greatly expanded.

The attitude of small employers and of some larger ones is, unfortunately, still primitive. A dispute is continuing at Stirchley, in my constituency, in which an employer, when faced by a demand for trade union recognition, told his workers, "I will close down if you insist that I recognise your union". He may have been ignorant of the law as it stands, but his natural reaction was to threaten his employees with closure if they joined a union. This is not untypical of thousands of employers, and is the reason for the Bill.

We are talking not about a handful of employers or workers but of tens of thousands of employers and more than 40 per cent. of the entire work force. The unorganised workers and those who work for small employers are the ones who will be most positively affected by the Bill.

In addition, the manual worker rather than the white collar worker will be the most beneficially affected, because the manual worker has been discriminated against consistently in the economic system by comparison with his white collar colleague. The Bill will go some way towards rectifying the more blatant discrimination between white collar and manual worker in the economic system.

I have one or two small criticisms. The use of phrases such as "appointment to safety committees" is unfortunate. I do not know whether it is one of the absurd drafting errors spoken of by my hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker) or whether it is a deliberate intention. but it should be made clear that members of safety committees are to be elected. We may wish to say that the members should be elected from trade union members, but that is quite different from saying that appointments to such committees should be made by and through trade unions. In the interests of industrial democracy the point needs to be made that such appointments will be made only by election.

I echo the pleas that have been made on behalf of home workers. There are some in my constituency. I am not unaware of their lack of protection. I shall vote for the Bill happily, remembering that there is much yet to be done. This is a modest step forward. I look forward to more.

7.33 p.m.

Mr. Ian Percival (Southport)

There is great irony in the situation today. For years I and other lawyers have listened to right hon. and hon. Members opposite shouting loud and long that the law and lawyers should be kept out of industrial relations. Yet in this Bill they seek to introduce the most extensive and detailed code of special laws we have ever seen and have built into it self-contained and special provisions for its enforcement.

The hon. Member for Birmingham, Selly Oak (Mr. Litterick) has welcomed that. As a lawyer I deplore it; for at least four reasons. First, right hon. and hon. Members on both sides of the House who have said that we cannot get good industrial relations by messing about with the law were right; and I wish those opposite had stuck to it. That does not mean that the law has no räle to play. Of course it has: it is the longstop. It must provide the remedies where only force would be available if there were no legal remedies. However, there should be the minimum, not the maximum, of law.

Secondly, we must get back to the fundamental belief that the law should be the same for everybody and that we depart from it and should have special laws for special categories only when there is a really strong case for doing SO.

Thirdly, we must return to the belief that where there are justiciable matters to be decided that is what the courts are for. We must stop creating new tribunals every time we have legislation like this to do the very job for which the courts exist.

Fourthly, we must remember that the purpose of the law is to protect the weak from the strong, not to give more strength to the already strong. My hon. Friend the Member for St. Marylebone (Mr. Baker) was right in saying that the Bill represents a significant shift of further power to the already powerful.

I want to say something about the new set-up of "courts" provided by the Bill. There is the Central Arbitration Committee, with immensely difficult and important judicial functions to perform. I have not yet been able to see what right of appeal, if any, there is from that body. Perhaps the Ministers will tell us that.

The Certification Officer has some very important questions to decide. They are such important questions of law that, as the hon. Member for Birmingham, Perry Barr (Mr. Rooker) said, they may well be the subject of litigation. Rightly, the appeal in such case is to the judges, because what the judges will have to decide is whether as a matter of law the unions concerned are independent unions as defined in the Bill.

The "service" has some judicial functions to perform.

The Employment Appeal Tribunal has the wide and important functions already referred to. I want too to say something about the new grounds of complaint to the industrial tribunals. Right hon. and hon. Members opposite were very critical of the unfair industrial practice concept which was introduced in the 1970 Act and of the fact that unfair industrial practices could be the subject of a complaint to the industrial tribunal. I have not managed to count them up, but the Bill creates a considerable number of new grounds of complaints to the industrial tribunals, just as if more "unfair Indus trial practices" had been created. I ask the Minister to say how many new grounds of complaint to the industrial tribunals are introduced by the Bill.

Has the Minister really considered the details of Clauses 10 to 21 and provisions like Schedule 10? Does he not think that we are introducing here a highly stylised approach, one that may well lead to the type of "ritual dance" that there is in the American labour relations set-up which creates new problems at every stage and may give rise to very difficult questions of law?

Has the Minister considered Clause 15 and the kind of complaint that may be referred to the "service" about whether a recognition recommendation is being complied with? Has he considered that he may be introducing there the concept of bargaining in good faith which has caused so much litigation, uncertainty and difficulty in American labour relations?

The Bill is very one-sided in the giving of rights to various people. The Minister has been asked this question already, so I will put it to him again briefly: why should not an employer have the right to refer a recognition dispute to the "service"? He may have every bit as good a reason for doing so. It is so silly to make it one-sided.

But we are not thinking only about employers. What about the non-trade unionists? Under the Bill a Member of a trade union will have the right to go to an industrial tribual if he thinks he is not being accorded his rights. What about a non-trade unionist who thinks that he has been badly dealt with by a union? Why should not he have some consideration as well?

We have heard over the years of the TUC's intention to deal with this matter, to follow up the Donovan recommendation. It is time that more consideration was given to the non-trade unionist. We are beginning to be rather suspicious that because, ex hypothesi, he does not have a union to speak for him he will not get much by way of help unless we keep pressing and pressing. I can assure the Minister that we shall do exactly that.

May I now say a word about Clauses 99 and 100. I intervened on the question of picketing, which is dealt with in Clause 99, when the hon. Member for Newton (Mr. Evans) was speaking. He said that the Government must go further than they appear to go here and that it is necessary that pickets should have the right to stop anybody and talk to him. Although he did not answer the question which I put to him, it appeared plainly that he was saying that pickets should have the right to stop a person and talk to him even if that person did not want to stop and be talked to.

I do not think Clause 99 gives pickets that right, but I should like to hear the Government's view. The feelings of many people would be allayed if we could hear from the Government that it is not their intention so to make the law that a person lawfully on the highway may be stopped against his will and should have to listen to somebody's case when he does not want to do so.

Mr. Harold Walker

This is the Government's intention.

Mr. Percival

"This is the Government's intention", says the hon. Gentleman, waving the Bill. I do not know whether he was listening when I asked the Minister of State what he thought Clause 99 meant. The Minister of State very wisely ducked that question, because Clause 99 as it stands is not clear.

Mr. Harold Walker


Mr. Percival

No, the hon. Gentleman will have half an hour in which to speak later in the dabate. I shall wait with eager anticipation for him to tell us what Clause 99 means.

Mr. Harold Walker

the hon. and learned Gentleman must not allow his inability to understand what my hon. Friend said to cloud the issue. My hon. Friend made it clear in his opening speech that the purpose of Clause 99 is to remove any doubts which were raised in the case of Broome v. Director of Public Prosecutions. It was the uncertainty which arose in that case which made it necessary to put this clause in the Bill.

Mr. Percival

I should like the hon. Gentleman to say how it removes uncertainty. Let me first identify the uncertainty and then say how it is removed. I am blessed if I can see it.

The hon. Member for Newton said that these further rights must be given to pickets because pickets would resent not having them. I hope it is beginning to percolate through that other people may feel resentment when their rights are impinged upon. If pickets are given the right to stop other people, even though those other people do not want to be stopped, those others will strongly resent being put upon in this way.

In connection with Clause 100 I wish to draw attention to the fact that there are many people who resent what is happening in the matter of unemployment benefit and supplementary benefit for those on strike. It gives great offence to many people that people working a four-day week may, together with supplementary benefit, earn more than those who are working a five-day week.

Clause 100 is designed to make it easier for a person who is out of work because of a trade dispute to get unemployment benefit or supplementary benefit for himself. I do not deny that there may be cases in which there is need for an improvement in the situation as it is, but I warn the Government that it gives great offence to the people put to inconvenience by the people who are on strike that those who are on strike should be maintained at their expense by means of supplementary benefit. It really adds insult to injury.

In order to keep within your time ruling, Mr. Deputy Speaker—

Mr. Deputy Speaker

The hon. and learned Gentleman has pretty well exceeded it.

Mr. Percival

Only because I was so unwise as to give way, Mr. Deputy Speaker.

In addition to my complaint that this Bill is far too legalistic, my other main complaint is that I do not see how it will protect much less create a single job. What is needed is for the great trade union movement to get on with the tremendously important räle of playing its part in bringing about greater efficiency right through the industrial life of this country. Everybody owes this country that duty—management, trade unions, workers, all of us. That is the task upon which this great movement should be concentrating. That is the task on which the Government should be engaged in persuading it to concentrate—not on the mass of detailed legal provisions of which the Bill consists.

7.46 p.m.

Dr. Jeremy Bray (Motherwell and Wishaw)

I do not wish to spend any time dealing with the Opposition attack on the Bill. It seems to me that they regard the world of industry as consisting of the managers and the managed. We are all employees today. Surely the greater the rights we have as employees the better for us all, unless the giving of those rights wrecks the economy. We should be united in the House in maximising the rights of employees.

I wish to deal with the overlap with the Industry Bill. My hon. Friend the Minister of State said that the measures in this Bill complement the Industry Bill. I think that is perhaps overstating it. They overlap. I am not worried about that. I am not even worried about competition. What I should like to see is integration of the measures, so that they offer the maximum improvement possible to industrial relations and to the effectiveness of industry, and indeed workability, when viewed from the shop floor.

No other hon. Member who was on the Standing Committee on the Indnstry Bill has spoken in the debate. I am glad to see the hon. Member for Caernarvon (Mr. Wigley), who I hope will speak at a later stage. The Employment Protection Bill calls for the disclosure of all information which a firm has and which is relevant to collective bargaining. The Industry Bill also calls for disclosure of a very wide range of information relating not only to the present but to future plans. The Employment Protection Bill offers guidance on disclosure through the publication of a code of practice from the Advisory, Conciliation and Arbitration Service. The Industry Bill offers no such guidance but has planning agreements in the background. The disclosure in the Employment Protection Bill is to trade union representatives. It is also to trade union representatives in the Industry Bill, through the mediation and initiative of the Secretary of State. The appeal against disclosure in the Employment Protection Bill is to the Central Arbitration Committee. In the Industry Bill it is to an ad hoc committee.

In the matter of enforcement, in the Employment Protection Bill a claim can be made a part of the contract of employment by the finding of the Central Arbitration Committee, a cunning device. A firm is told what it has to pay its workers if it does not agree to disclose information to them, a formidable sanction. In the case of the Industry Bill the firm is merely fined. As for breach of confidentiality, there is no confidentiality attaching to information disclosed under this Bill. Under the Industry Bill it is an offence for information given to the Secretary of State to be disclosed further, but not for information given to trade union representatives. In both Bills the disclosure arrangements depart from the provisions of the Company Acts. They also depart from the provisions of the Statistics of Trade Act. Both Bills would have been strengthened had a thorough disclosure system been thought out before the Bills were drafted.

My plea is to combine the strong features of disclosure in both Bills, to make the disclosure more effective and more useful to the people on the shop floor. I suggest that in Committee it may even be possible to adopt the wide range of disclosure outlined in both Bills but to put it on to a compatible basis and to require the disclosure of plans as well as of present information under this Bill.

The idea of a code of practice is excellent, but a code of practice should not be produced only by the Advisory, Conciliation and Arbitration Service, which is not equipped to deal with the wide range of issues raised under the Industry Bill. The code should be provided by the Government themselves, the Departments acting together.

Both the trade union representatives and the Secretary of State should be able to take the initiative in requiring disclosure of information. As regards appeal, the Central Arbitration Committee is unlikely to be constituted to be able to deal with appeals against disclosure on the wide range of matters raised under the Industry Bill, and an ad hoc committee would seem best equipped to deal with disclosure over the whole field, including disclosure under this Bill.

The idea of the sanction, of its being in the hands of the employees to exert the final sanction by making a claim, that claim being recognised by the Central Arbitration Committee, is ingenious. I should like to see that used also in the machinery of the Industry Bill.

I turn next to the major set of clauses on redundancy. Again, one sees the need for greater integration of the two Bills. Under the present Bill as drafted, the employees in a firm can demand notice, notice and yet more notice of redundancy —they can huff and puff, but they will still he sacked. In opening, the Minister of State said—the Chancellor of the Exchequer foreshadowed it in his Budget Speech—that provision would be made for the maintenance of employment through payment of funds to a firm to enable it to defer redundancies. But far wider issues than that are likely to be involved.

There are 20,000 employees of the British Steel Corporal ion today who have been threatened with the sack by the Chairman of BSC. He has talked about a 50 per cent. rundown in the strip mills division. The background is that car sales are down slightly—10 per cent. or 15 per cent—car showrooms are overstocked, and production is down more. When this repercusses through to the steel industry, it is amplified and a ruthless chairman talks about 50 per cent. redundancy—a lunatic escalation—and it requires a range of issues to be brought into the argument which, frankly, are far beyond the scope of the Advisory, Conciliation and Arbitration Service or the Department of Employment and call for the full apparatus of the planning agreements under the Industry Bill and of the Departments of Industry and of Employment working together, with the Treasury.

Such a range of measures requires a wider spread of issues and a wider range of firms to be taken into consideration in dealing with a redundancy situation; and it requires also a greater span of time. By the time the point is reached of a firm wishing to make workers redundant, it is probably too late to take more than palliative action. The action should have been foreseen much earlier when the Government were taking measures which influenced demand, or earlier when the firm was making plans for the introduction of new products, or earlier still when it was considering the type of industrial capacity in which it should invest.

I hope that my hon. Friend the Under-Secretary of State, for whom I have the greatest respect, will be able to assure us that the House will have greater time to consider these matters in Committee so as to produce some mutual reconciliation and reinforcement of the two Bills at that stage.

7.54 p.m.

Mr. David Mitchell (Basingstoke)

I am glad that the hon. Member for Don-caster (Mr. Walker), the Under-Secretary of State to reply to the debate tonight because I know that he cares greatly about the problems to which the Bill is directed.

However, I regret the absence of the Secretary of State. We wish him a full recovery, but I wonder why he had to enter hospital today, the day when his Department was to introduce a major Bill of which he is the author. Is it that his bed came up and, like every other National Health Service patient, he could not wait and had to take it? If that is the case, perhaps he might be invited to join BUPA, to which many of us belong so that we can fulfil our parliamentary duties with the timing best suited to them.

The Under-Secretary of State for Employment (Mr. John Fraser)

Pretty cheap.

Mr. Mitchell

When the Industrial Relations Act was repealed, I said that I expected most, if not all, the major provisions of that Act to be restored in my lifetime by one Government or another. Little did I expect that so much would so soon be brought in by this Government. To that extent, I welcome the Bill. Much of the code of industrial practice is here re-enacted. All the disclosure provisions are here, which I am glad to see, for there is nothing like misunderstanding and rumour to cause disputes in industry, and disclosure to employees can do nothing but good.

It is a large Bill. In one piece of legislation we have industrial relations, employment agencies, training, and safety and health at work. With all respect to the Government, there is too much in the Bill. These matters would have far better attention in Committee and be much better attended to by the House if there were separate pieces of legislation dealing with each of those items.

However, the Bill confers a considerable number of benefits on trade unions and workers, and this will, of course, be built into the cost structure of industry. The question is whether now is the time for increasing costs and increasing prices. How do we balance what is socially desirable with what is economically practicable? The Government remind me of the captain of the "Titanic", at full steam ahead for the icebergs and rocks of devaluation and unemployment, for that seems to be their policy—to pile extra costs on to industry regardless of the fact that it cannot afford to meet them.

The hon. Member for Birmingham, Selly Oak (Mr. Litterick), in an interesting speech, drew attention to the fact that we have the lowest wages in Europe, and he asked why, that being so, industry could not afford to fulfil the terms, conditions and requirements proposed in the Bill. The answer is that in this country we have less capital behind each worker than the countries of Europe have, so that each worker is bringing in less profit to his employment and to his firm, and, therefore, his firm is less able to pay for the sort of standards of working conditions, pay and other benefits which one would wish to see.

The answer lies with the Chancellor of the Exchequer, not with the Department of Employment. Having drained industry of its working capital, he cannot be surprised if industry has not got the money to invest to enable each worker to bring in enough money to his firm to pay for the benefits we want to see.

The Bill presents that problem, the problem that it piles additional costs on industry, but I wish to direct special attention to the way in which it deals with small businesses. I hope that the Under-Secretary will tell us what representations with regard to small businesses both Ministers and his Department received during the preparation of the Bill and following the White Paper. My information is that small businesses are exceedingly concerned about what faces them.

The purpose of the Bill is to improve industrial relations. The Minister will know perfectly well from his departmental statistics that small businesses have far better industrial relations than do large firms. There is much greater understanding, there is flexibility and there is give and take. We do not improve that spirit and atmosphere of give and take by formalising and putting into legislative form minimum rights which, more often than not, would be worked out between employer and employee on a personal basis. Indeed, we were told many times during the passage of the Industrial Relations Act by Labour Members, including those who are now Ministers, that work practices could not be formalised or put into law. Yet here is a Bill which does just that. I fear that creating an entrenched position on one side will lead to the same sort of attitude on the other, and that is not good for industrial relations.

Small businesses face three particular problems, and I hope that the Minister will give his attention to these. First, there is the question of maternity and the guarantee that a woman can have her job back after she has had her baby and can be paid for maternity leave. I raised earlier the question of a Member of Parliament's secretary. There is no cut-off, and the provision, therefore, applies to the one-man business where there is perhaps only one secretary. It is unrealistic to assume that in that type of organisation a man can temporarily take on someone else and then guarantee to take back the original employee.

There are countless jobs where women do essential and skilled work that takes months to learn. No one will bother to learn that job in the certain knowledge that after nine months she will get the sack, because that is what would happen. In a small business a stock control clerk, an invoice clerk or an order clerk has to know the specialised range of commodities that the firm deals in. An MP's secretary has to know the Member's constituents. In addition to all this there is to be a payment towards maternity. I believe that that should be borne on the social services and not by the individual employer.

On the question of lay-offs, it is unfair that because a strike takes place in another firm an employer should have to pay the wages right the way through for his own employees. A small firm could be bankrupted in such circumstances. These days industry is far more integrated than it was. A dispute in one firm could have a general reaction right down the line among firms which use parts produced by that firm. How much, I wonder, will the losses of British Leyland be increased over the next few years in meeting this burden. If that is the effect on a large firm, it is not difficult to imagine what it will mean for the small firm.

There is also the question of time off for various forms of local government service, work on the magistrates' bench and so forth. This sort of thing is arranged on a flexible, commonsense basis, where the employer and employee work out how it can be practicable to do a particular job and sit on the bench or serve in local government. Now, instead of that commonsense approach, there will be an absolute right. What will happen? Take the example of my right hon. Friend the Member for Lowestoft (Mr. Prior), who farms. Suppose his cowman tells him that he is going into local government and that at milking time one day a week and, depending on committees, on certain other days, he will not be at work. Do my right hon. Friend's cows not get milked?

Mr. Clemitson

The right hon. Gentleman should do it himself.

Mr. Mitchell

It is all very well for the hon. Member to say that my right hon. Friend should neglect his parliamentary duties. That may be the hon. Gentleman's wish.

Mr. Bob Cryer (Keighley)

Some of us actually concentrate on our parliamentary duties to the exclusion of having about one hundred acres to farm. Is it not about time that right hon. and hon. Members concentrated on their parliamentary business to the exclusion of outside business interests?

Mr. Mitchell

My right hon. Friend is well known for giving his full time and attention to this House and to parliamentary business—

Mr. Prior

I may not talk as much as the hon. Member for Keighley (Mr. Cryer) but I make more sense.

Mr. Leon Brittan (Cleveland and Whitby)

He is better at milking cows, too.

Mr. Mitchell

The hon. Member for Keighley (Mr. Cryer) will be aware that a number of his hon. Friends are engaged in farming enterprises, and so forth, and employ cowmen, and that they, two, would face this problem. What about the licensee of a pub who may be a manager licensee? Does he say to his employing brewery "I am sorry; I am opting out because there is a council meeting"? In law that man is charged with the responsibility for what occurs on those licensed premises. One could go on finding cases where common sense and not the law must be applied. Surely the Government will have to make changes on this point.

In introducing the Bill the Minister of State gave a very interesting statistic. He said that the Bill would cost a mere £105 million a year. He said that that was not a serious problem, that the average cost was, therefore, only £5 per man per year. I do not know how a man can become pregnant, but that was the average cost that the Minister indicated. He worked out that the cost would be 10p a week approximately. A large company would incur the average cost, and it could afford to pay. A small business, however, where there are 25 employees or fewer, will not incur the average cost. If one of the situations I have been describing arises the expenditure for that employer becomes very large. It will not be £5 a year. It will be a very substantial sum. It will be arbitrary, unpredictable and uneconomic Under existing pressures many small businesses are folding up. They already face unfair treatment under the national insurance legislation, with the further turn of the screw that is involved for the self-employed. It will add to the rising number of bankruptcies among small businesses.

This legislation is desirable in itself, but when it is added to the other burdens it becomes intolerable to the businesses which are caught by it. The Government will have to think again about a minimum cut-off point for firms affected by these proposals.

8.9 p.m.

Mr. Eddie Loyden (Liverpool, Garston)

Conservative Members have concentrated on the question whether we need the Bill. I remind them that it is part of a general strategy and is very much connected with the Industry Bill. It covers the whole field in which the Government have been active since February 1974. At that time they were motivated to take action by what had happened in industrial relations as a result of the disastrous Industrial Relations Act and the chaos it caused. As a result of that Act there was a breakdown in industrial relations, which reached their worst state since the 1920s and 1930s. We have to consider this Bill against that background.

According to Opposition Members, the trade union movement is in full command of the commanding heights of industrial activity, and is so powerful that it can put right any imperfection in industrial relations tomorrow. There are sections of the trade union movement that have formed themselves into groups out of sheer necessity, that are prepared to fight for conditions and wages that they regard as justified. But there are whole areas in industry that still lag behind.

In my constituency there are still places that would be recognised as sweat shops, where young people and women are exploited. Throughout British industry there are countless hundreds of thousands of workers who are deprived of minimum protection.

I cite one instance from my own constituency. It concerns a modern factory, not slotted down a side street, but built as an advance factory some years ago. Women report to work there on the basis that when they get to the gate the management decides whether they are required. That is how labour was hired 40 or 50 years ago and it still prevails in a society that claims to have made tremendous advances in industrial relations.

The work is arduous and the women work in water that is sometimes knee deep. They do not know whether they will be allowed to work that day until they reach the factory gate. It is only with the consent of the management that they are allowed to work.

These conditions are not the fault of any trade union agreement. Sad to say, this is not a trade union organised work force. Indeed, that shows the need for workers to be organised in a trade union. In the end, that is where the main responsibility must rest.

I consider the Bill in the context of the Government's general strategy. A number of its provisions are essential and should have been enacted some time ago. Industrial relations have always been regarded as concentrating on wages and conditions, and employer responsibilities have begun and ended at that point. However, as some of my hon. Friends have pointed out, in other European countries there has been a dramatic extension of employer responsibility for other aspects of the life of an employee.

The Bill sets out on a course that will bring a whole number of new responsibilities within the ambit of industrial relations. For many sections of workers that reform is long overdue. For instance, so far as I know there is not a factory in the country that provides nursery accommodation for its women workers. That should be among the responsibilities of an employer.

I am astounded that Opposition Members should come to the defence of the small business man in this connection. One begins to suspect that their case is not that he cannot afford the cost of this limited Bill but that they wish to shield him from meeting his responsibilities to those he employs. Yet these small business men are, in the main, those who disregard their responsibilities towards their employees.

Opposition Members have also spoken about the need to consider district or area wage levels, but I remind them that there is a good system of voluntary wages tribunals that for many years, since shortly after the First World War, have used the criteria of district wages. No new experience is required to compare the wages of one company with the area wages to see whether they are fair.

The Bill will not resolve all the current problems in British industry. We have a long way to go to achieve that goal. There will have to be a dramatic change in general policies before then. But certainly the Government have started on the course. This is a Bill not to clobber the trade unions and to ignore the imperfections, the wrongs and the injustices in industrial relations, but to take the first steps in the process of creating the climate in which industrial relations will be improved. We hope that it will be the beginning of a forward-looking policy.

8.17 p.m.

Mr. Leon Brittan (Cleveland and Whitby)

The Secretary of State is, sadly, not with us but he has left us a message. He is reported as having said at the Labour Party conference that his dearest ambition was to stay at the Department of Employment until he could see the appalling unemployment figures come down. The main reason why I am opposed to the Bill is that, applying that test, it will further prolong the Secretary of State's tenure of office. So far from reducing unemployment, it will increase it. To describe the Bill as the Employment Protection Bill is a flight of Orwellian double talk. It should really be called the Employment Destruction Bill, because that will be its effect.

I have no doubt that the intentions behind it are sincere, but we all know the destination that those who have good intentions sometimes reach. In this case they will reach that destination because the Bill is based on a fundamental economic fallacy. It is based on the idea that if high statutory requirements relating to terms and conditions of employment are imposed, it will be the employee who will benefit. That is by no means the whole picture. Some people will certainly benefit, but others may find themselves out of a job as a result, or not taken on when they might otherwise have been.

Why are there such wide variations in the terms and conditions of employment? It is not just because some employers are beneficient and others are not. It is not even because sometimes the trade unions are weak and on other occasions are strong. It is often because one company is highly successful for a whole host of unrelated reasons and is, therefore, able to offer excellent conditions, while another company is much less successful and able to offer employment only on less attractive terms. If we insist that those terms are improved, the effect may well be to drive the company out of business, or at least to compel it to reduce the number of people it employs.

If the conditions at work are barbaric it may be better for the firm to close down and for the work people to be supported by the State. We are not talking about that situation. We are talking not about a Bill designed to stop children under the age of 10 from working in the mines but about a Bill that purports to extend a whole host of benefits provided by some of our most successful companies right across the industrial board. The result will be that fewer people will enjoy better conditions.

That is entirely in line with the Government's economic policy. By allowing huge wage increases that have not been earned, more and more people are being priced out of a job. It is in that context that the Bill should be examined. It may be consistent with the rest of the Government's policy but to call it an Employment Protection Bill is to enter the world of "Alice Through the Looking-Glass". One of the best illustrations of the working of this Bill is provided by Clause 88 and Schedule 10, which permit the Central Arbitration Committee to require an employer to raise his employees' wages to the general level observed for comparable workers by employers in the district concerned.

Mr. Jack Jones is reported as regarding this provision as the first step in a major campaign to raise the wage levels of low-paid industrial workers to the wage levels of the best. There is no doubt as to the divergence of the wages in different firms. I have an analysis of the latest figures in the engineering Industry in the Tees and Hartlepool area. For a litter the average wage for a 40-hour week, including threshold payments, ranges from £37.81 to £56.50. For a plater it ranges from £46.50 to £61. For a welder, class 1, it ranges from £45–90 to £61. The significant point is that in every case it is the big employer who is paying the high wages and the small employer who is paying the low wages. If this Bill is enacted and is used as Mr. Jones would like it to be used wages will be forced up to the average level. That will produce a new average, and the leap-frogging inflationary procedure will begin again. The effect will be that small firms will simply not be able to compete.

The situation is rendered worse by the fact that, at least in that area, work that has to be taken into account includes work concerning North Sea oil installations, where there has already been an upper wage level which makes it difficult for small employers to compete. The result will be increased costs, increased inflation and unemployment, just as we are seeing in the economy as a whole, as a result of the Governments' policy.

This is not the only provision of the Bill which has that effect. Many others that have been mentioned operate in the same way—the guarantee payments, maternity pay, time off. They all affect the small employer. They all make it more difficult for him to offer employment. They will lead not to the protection of employment but to the reduction and destruction of employment. If the Chancellor were proposing this Bill as part of his policy of a shake-out of labour I could understand it. But the context is quite different. This Bill is presented as an Employment Protection Bill. Whatever else it is, it is not that.

The Bill is part of a package deal by which more power is handed over to the trade union movement. It is significant that again and again it is not the worker who benefits but the trade union. It is ironic that the unions should be so shortsighted that in asking for all this and in welcoming it they are happy to see resurrected a new framework of law different in name and policy but not so different in structure from the much-aligned Industrial Relations Act. We see the legal framework being woven yet again.

My basic objection to the Bill is not that it is another example of giving still more power to the unions, nor even that it is the resurrection of legal machinery in such a hypocritical form. It is that by calling what ought to be an Employment Destruction Bill an Employment Protection Bill the Government are entering what is even by their standards a new top league of double talk and adding still further to the unemployment that their other policies have already created

8.25 p.m.

Mr. John Watkinson

(Gloucestershire, West): I do not wish to emulate the hon. Member for Cleveland and Whitby (Mr. Brittan) in his somewhat hysterical outburst over this rather mild Bill. I give a broad welcome to the Bill. We have heard from Tory Members that one of their principal complaints is that the Bill introduces yet more legislation into the industrial area. I welcome legislation in the areas delineated by the Bill because it means that through the operation of such legislation we shall be able to reach those areas of society which, without legislation, would not be dealt with by a voluntary system for decades.

I particularly welcome the temporary employment scheme. Perhaps the hon. Member for Cleveland and Whitby did not hear that. This is an imaginative scheme, which is vital in view of the recently announced unemployment figures. With unemployment rising at its present rate it is clear that the coming winter will be an extremely serious one. There is no point in anyone thinking that we can use unemployment as a means of wage control.

Obviously wages have to be brought under control, but only by the grossest and most unimaginable levels of unemployment would it be possible to bring down wages. Therefore, I welcome the scheme to bring into productive enterprise men who would otherwise be laid off. We have heard from the Chancellor that it would cost over £900 million a year to keep 1 million men unemployed. That is a waste of the basic resources which we require to produce the output needed at home and for exports.

I want to consider the problem of picketing—a problem which remains in spite of Clause 99. The right to inform and persuade in a peaceful manner is an essential extension of the right to strike. The question is the degree to which individual pickets and trade unionists should be allowed to exercise that right. During the course of this century the law has basically been enshrined in the Trade Disputes Act 1906. The principle underlying that Act was that in furtherance of a trade dispute it was lawful for a picket to attend for the purpose of peacefully obtaining or communicating information, or of peacefully persuading any person to work or not to work.

A basic dispute has arisen between the courts and the trade union movement. The courts have laid increasing emphasis on the fact that the right conferred under that Act, and under the Industrial Relations Act 1971, is a right of attendance, whereas the trade unions wish to utilise the opportunity of picketing to convey information and, if necessary, to stop people from attending. A series of decisions in the courts has undermined the trade union position to the point that, in the recent judgment in Hunt v. Broome, it was held that under the existing legislation there was no right to stop any person or any vehicle in order to persuade that person or the driver of the vehicle of the correctness or otherwise of a strike. It was held in the first instance by the magistrates that pickets should be entitled to do so, but the Law Lords held that there was no such right under the legislation.

However, according to Lord Reid, there was a right to attempt to persuade someone, who said that the position of a picket was similar to that of a hitch-hiker—in other words, he could stop on the side of the road and advertise himself and if the person who came along wished to stop, that person could be addressed and persuaded. But there was no means open to a picket to stop someone and say, "This is what I wish to say to you". That decision was emphasised in the case of Cavanagh v. Hiscock, when the Lord Chief Justice confirmed the decision in Hunt v. Broome that there was no right to stop.

Therefore, trade unionists seek the right to stop to persuade, but the Acts do not presently give it. As I interpret Clause 99, if my hon. Friend the Minister of State is right, the Government are legislating the view of Lord Reid in the decision in Hunt v. Broome that trade unionists should have the right to persuade, in the words of the Act, by peaceful means falling short of obstruction". How can one seek to persuade by peaceful means falling short of obstruction"? That is the difficulty which will confront trade unionists, and which needs clarification.

I understand the problem about legislating to allow trade unionists to stop other people and to stop vehicles. Let us suppose that there was a strike in Oxford Street and shop girls had the right to stop vehicles. There would be pandemonium. Obviously there are difficulties about the site. There will be difficulties about the infringement of personal freedom, though it may be suggested that it would be possible to stop an individual for a reasonable time so that a view might be put to him.

Therefore, perhaps what is needed—it has been suggested—is a code of practice enabling the Government and the TUC, with the co-operation of the police, to come to an agreement whereby approved, accredited pickets would be able to stop people for a reasonable time to present their case and, having done so, allow those people to pass on their way. I hope that the Government will consider the possibility of introducing a code of practice in this area, because I do not believe that Clause 99 takes the matter any further than the decision in Hunt. This is a long way from what trade unionists would seek.

The only other matter to which I wish to refer is the question of the Shrewsbury trial. I do not want to go into any of the matters raised by it, but it is appropriate to draw attention yet again to the fact that trade unionists are concerned about the operation of the conspiracy laws as they apply to trade unionists when they gather together for the purposes of picketing. The operation of the conspiracy laws in this area is in itself offensive, and in one sense it is perhaps sad that the previous case did not go as far as the House of Lords, so that their Lordships could rule on the question whether conspiracy was an appropriate charge when linked with intimidation under the 1875 Act.

There were, however, elements in the case—such as the fact that the judge was

able to use the common law to impose a particularly severe sentence, and the fact that on evidential grounds the prosecution was able to bring evidence which it would not have been able to bring in other circumstances—which caused concern in the wider area and in the area of trade unionists.

I appreciate that the matter I have just dealt with cannot be considered in the context of the Bill. However, I hope that there will be some attempt to clarify at least the picketing practices.

8.36 p.m.

Mr. Dafydd Wigley (Caernarvon)

I shall not deal with the details of what the hon. Member for Gloucestershire, West (Mr. Watkinson) said, save to say that I agree with what he said about the Shrewsbury case. There is room for grave misgivings about the way the conspiracy law was used in that case, and I do not believe that it was intended to be used in that way. There are misgivings in many circles within the country not only about that specific case but about the general context as well.

The hon. Member for Motherwell and Wishaw (Dr. Bray) referred to the Bill's impact on other legislation which the Government have in hand. He referred to the Industry Bill that is currently in Committee, and tried to contrast different parts of the two Bills. In many ways it is regrettable that it was not possible to bring forward the whole batch of industrial legislation at once. I appreciate that in practice that would be very difficult for the Government.

The Industrial Democracy Bill, which we have yet to see, could be the key to many of these matters. It could be the piece of legislation that will complete the jigsaw. It is difficult to evaluate the jigsaw until we have that piece.

Although small, the Industry Bill was heralded by many of the people in the media as an extremely controversial issue. I have had much more correspondence concerning this Bill than about the Industry Bill. A lot of that correspondence is misguided and based upon fallacies. None the less, it exists. A lot of it is part of the backlash from the previous industrial relations legislation, and there is a feeling that the pendulum has swung from one side to the other. It will be extremely regrettable if escalating polarisation is to take place in industrial relations.

As many hon. Members have said, we cannot legislate for good industrial relations—we can only provide the basis. It is valid to say, as hon. Members have said, that over the years in these islands the best practices of the enlightened employer have been built into a legislative structure. If that process is developed in a manner that cuts corners, and if it is developed too quickly, it can give rise to reactions similar to the reactions to the measures brought forward by the previous Conservative Government.

The Bill has a relevance in Wales. We have had to face the effects of redundancy and unemployment. It sometimes makes my blood boil to hear the sort of remarks that we heard not so long ago in the Chamber about this being a Bill that will create unemployment rather than employment. Anyone who has seen people of the age of 50 or 55 thrown on the industrial scrapheap, as they are in many parts of these islands, with no alternative employment open to them, treated as dispensable inputs into an industrial machine, cannot help but feel extremely angry. There is a need to ensure that the safeguards within the community give the maximum possible protection to those persons least able to help themselves in these terms, as well as in so many other terms within a Welfare State.

The Bill can be regarded to a large extent as a safety net to protect those who are employed perhaps in the more dubious works by the more dubious employers. Many of the more enlightened employers follow the practices in the Bill. Many companies have moved for guaranteed weeks. I am thinking in particular of the engineering industry. But many other concerns lag behind. There is a need for the Bill in order to ensure acceptable minima in those concerns. It is unfortunate that some of the better employers have been protesting about some of the clauses, because I do not believe that those clauses were aimed at them. I do not think that the better employers have much to fear from most of the provisions of the Bill.

However, there are one or two specific matters to which I wish to refer. One is the provision concerning a woman's retention of a job when she leaves to have a baby. There are great practical difficulties, particularly in the smaller concerns. I come from a rural area. If a person obtains a job there he regards it as an achievement, because the alternative is often to move to look for a job elsewhere. If women leave for maternity reasons, and the job is temporarily allocated to someone else, all sorts of social pressures will result.

We should carefully consider whether we should be making such provision in this Bill. Is our objective right? Should it be the objective of an enlightened social and industrial policy to urge women who have just had babies to return to work at the earliest possible opportunity? We should be aiming at the sort of Welfare State and social services that can ensure that there is sufficient support, particularly for the one-parent family, the mother by herself, on whom there is the greatest pressure, so that she does not have to return to work. Her child is utterly dependent on her. Therefore, I question both the premise of the provision and its practicality.

There have been several references to the effect of the Bill on small companies. It needs to be underlined that there will be difficulties for the company employing six or seven people. Many a manager must be a general factotum, the buyer and the seller, the director of production and the obtainer of goods. To ask such managers also to be legal experts, having to deal with many of the bureaucratic strings that inevitably come with such legislation, may be to impose too much of a load. It could cause many difficulties.

There is another aspect that worries me. In my constituency there are many seasonal workers. Unfortunately, the economy is geared to seasonal working. I suspect that some of the provisions of the Bill could cause problems to seasonal workers. I shall be grateful if the Government will keep their mind open on this problem.

Mrs. Winifred Ewing (Moray and Nairn)

Will the hon. Gentleman bear in mind that the problems are not always just for the workers engaged in seasonal work, and that there are also problems for their employers? For example, those using fruit are dependent on whether the farmers supply the goods so that the work may be done. I have such a concern in my constituency—Baxters, which will be known to all hon. Members—which is always dependent on the fruit arriving, which is something over which the firm has limited control.

Mr. Wigley

I accept the hon. Lady's point. There are problems in both directions. Provisions are necessary for the temporary seasonal employee, perhaps amounting to more than is in the Bill. There are also practical difficulties from the point of view of the employer.

The hon. Member for Motherwell and Wishaw and others have spoken about disclosure. Only a few days ago I was talking to a German industrialist about the controversy over disclosure. He was amazed, and thought that industry in Britain was making far too much play of the dangers of disclosure. He believed that there was much more to be gained than lost from developing as open as possible an industrial community.

The trade union räle under the Bill has also worried some employers who have written to me. There is a feeling that possibly the trade union has more access to some of the bodies set up by the Bill. But in many instances the powers of initiative rest with the employer, and often the trade union needs the ability to appeal, because it cannot take initiatives of the type which are open to the employer in the first place. It is right to maximise the opportunity for trade unions to go though this sort of procedure because it encourages them to adhere to constitutionality, which is the basis of good industrial relations.

I refer, finally, to the long-term aspect. The Bill should be regarded as part and package of a move towards greater economic planning in the broadest possible context. That requires stability of the work force and stability of the economy. Therefore, it is necessary to regard the Bill side by side with the Industry Bill that can provide the jobs and the Industrial Democracy Bill that can give motivation in seeking to ensure that there are also safeguards for employees of industry in the counties of these islands.

8.45 p.m.

Mr. Ivor Clemitson (Luton, East)

It is not for us to try to eliminate conflict; it is for us to try to eliminate destructive conflict and to create the conditions in which constructive conflict can occur. I do not wish to minimise the importance of strikes and other forms of industrial action. We should try to reduce their number and their impact, but if we regard that as the sole objective of our policy our efforts are negative and must be misconceived.

To deal for a moment with the elimination of negative conflict, as anyone with experience of industrial relations knows, industrial disputes do not have single, simple causes. Their causes are complex, and some of the most important of them are so deep that they are never described or articulated. Lying behind many disputes is a deep feeling of insecurity, fear about loss of jobs, fear about losing money, fear about one's employer going bust, and so on. Insecurity is one of the major unwritten, unrecorded causes of industrial disputes. If we want to do something about reducing negative conflict, we are well employed in removing one of the basic causes, which is insecurity, and that I take to be one of the important elements of the Bill.

To try to remove those causes and to eliminate the negative aspect of conflict is not enough. We must provide a framework for healthy and constructive conflict. There must be security and there must be proper protection for the rights of trade unions, trade union membership, the recognition of trade unions and all the rest that is contained within the Bill, without which industrial relations will not flourish in the atmosphere of trust which is so vitally needed.

I see the Bill as a major attempt to create those necessary conditions in which conflict can become creative and in which industrial democracy can grow. I do not want to go into the question of what we mean by industrial democracy. It will vary from plant to plant and from industry to industry. But it must, if it is worth anything, grow from below and not be imposed from above.

However, I gather that not all hon. Members see the Bill in quite such a favourable light, and I sympathise with them in their difficulties. Even the CBI could scarce forbear at least half a cheer in November when the consultative document was published. The CBI said: It is true that many of the benefits suggested for employees may in themselves be desirable. It is difficult, for example, for gentleman not to treat ladies, particularly pregnant ones, with some respect. Faced with that dilemma, Opposition Members have two courses open to them. The first is to pick and choose and say, as did The Economist, in March, in a memorable headline: Babies yes, pickets no. The second choice is to say "Yes", it is a jolly good thing to treat working people better but this is a bad time to do it because we cannot afford it."

The argument is built up into dire warnings of spiralling inflation, bankruptcy and many people being out of work. However, if we take the £100 million which has been quoted, it must be considered in the context of the total wage and salary bill, which last year was approximately £45,000 million. On a rough calculation, that means that the Bill represents, as near as dammit, one half millionth of the total wage and salary bill, or, in percentage terms, 0.0002 per cent. I agree that that may not be the exact position, but that puts the matter into some kind of perspective.

Further to the discomfort of Conservative Members is the small matter of the European Economic Community. Almost to a man Conservative Members are content to see our continued membership of that organisation, yet a study by the Trade Union Research Unit of Ruskin College reads: the principle of the guaranteed week is recognised in law in all our partner countries within the EEC. There is the exception of Ireland. The study continues: in all the original six member countries the principle applies to all industries and has been in operation for a considerable period of time. Conservative Members will remember a debate that took place a few weeks ago on a Community directive on the harmonisation of the legislation of member States relating to what are rather curiously called "mass dismissals". That prompts the thought whether the EEC, like Paris before it, is worth a mass.

The real objection to the Bill from Conservative Members is that it contains a package of proposals which, according to the CBI, is one-sided and unfairly biased in favour of the trade unions. The Daily Telegraph, in referring to the Bill, used the headline: TUC Militants Win Charter of Privileges'.". Well, "you pays your money and you takes your choice", but I prefer to see the Bill as part of a move to enable working people, through their trade unions, to take a more positive and fuller part in the governing of their own rights. That is not to say that trade unions are perfect organisations. There is much that needs to be done in terms of education, for instance, but I prefer to be optimistic and to regard shifts in power and responsibility with hope rather than to adopt the attitude of a conservative defence of privilege.

I turn to one or two specific aspects of the Bill. I pick out two items for special praise. First, I deal with the section on insolvency. Hon. Members may recall that last year we had the Court Line collapse. That resulted in the loss of 1,200 jobs. I remind the House that Court Line was based in my constituency. That is an intolerable situation for people to face who have given years of service to a company. It is intolerable that they should risk losing wages which they have earned. Surely no hon. Member can cavil at the attempt to put the situation right.

Secondly, there is the question of the reinforcement and reinstatement provisions as a remedy for unfair dismissal. It is an improvement that I welcome. I have only one criticism to make, and any criticism of the Bill must be in terms of what has been left out in terms of levels. My criticism relates to the position of apprentices. It seems that apprentices, in comparison with adults, need more and not less protection. If the position of apprentices cannot be dealt with in this Bill I hope that it will be dealt with in other legislation.

I wonder whether apprentices can ever have the kind of security which they need as long as their apprenticeships are vested in a particular employer and not with an independent body, whether it be a training board or something similar.

Has the Bill been looked at from the point of view of disabled people? I merely ask that question and leave the matter there.

In summary, I welcome the Bill. see it as a considerable step towards the improvement of the lives of millions of working men and women. I also see it as part of the movement towards a truly democratic way of life. I hope that the Bill will not be regarded as the last word, but, rather, as a first word—in other words, as a sound foundation on which we can build for the future.

Mr. Deputy Speaker

In calling the hon. Member for Keighley (Mr. Cryer), I ask him to try to finish his remarks by 9 o'clock, to allow time for the winding-up speeches.

8.56 p.m.

Mr. Bob Cryer (Keighley)

I always bow to your entreaties, Mr. Deputy Speaker.

Opposition Members display an air of hypocrisy when talking as though the Bill hands over power to the trade unions. It does nothing of the sort. It hands over power to the people. It gives right to the people, if they choose, to form a trade union. It also enables a trade union to be recognised as of right. The people can take their choice. Workers can say "We shall not become involved in long disputes, such as the Roberts Arundel, Stockport dispute or the Denby dispute at Baildon, or, indeed, the Fine Tubes dispute in Wales". If people want that sort of bitterness, they will oppose the Bill. The legislation will provide for trade unions to be given recognition in statutory form and will end industrial disputes, rather than the reverse. Surely if the legislation avoids disputes such as the ones I have outlined, in one year it will save the fairly paltry sums of money which the Opposition complain are being wasted. Therefore, the measure is very much to be commended.

I wish to refer to the arguments which have been deployed about the needs and aspirations of small business men. In my constituency I have had complaints from workers who have been dismissed from small businesses—loyal, long-serving employees who are not members of trade unions but who are people who respect their "gaffers". One of the men I have in mind who was sacked is finding great difficulty in finding another job. There is no reason why justice should not apply to small firms as well as to large ones.

Clause 53 is an important and long overdue provision which is most welcome. It relates to the right of workers to participate in public duties. The Opposition have been a little carping on this score. It has never been difficult for a director to get on to a bench of magistrates. It is time that some of our magisterial benches became more evenly balanced. Many are weighted in favour of the middle and managing classes simply because those people have the opportunity to attend courts whereas ordinary working people do not. A member of my local Labour Party wanted to become the last mayor of Keighley, but was unable to do so. That might be regarded as something of a "Toytown" function, but to the man concerned it was a matter of great pride. He was told that if he applied for that job he need not come back for another. That is the sort of position in which ordinary people find themselves. I am appalled to find the Opposition seeking to bolster up such attitudes.

Clause 99 on picketing needs clarification. It envisages people having the right to stop and persuade, but makes no attempt to alter the House of Lords decision. Pickets want a clear understanding of the law. They do not want to cut across it. They do not want to find themselves in court in difficult legal circumstances. Among their rights should be the ability to be able to stop people and to be able to persuade them of the value of one's case.

I should like to conclude by referring to Schedule 13, which amends the Health and Safety at Work Act 1974 and brings in agricultural workers. It was a disgrace that during the period of the minority Labour Government Opposition Members deliberately sought to impede provisions aimed at maintaining the standards of agricultural workers as high as those covered by the Factories Acts. Therefore, I commend the Bill to the House.


Mr. Barney Hayhoe (Brentford and Isleworth)

I should like to remind the Minister that a number of important matters have been raised during the debate and we are hoping to hear him answer them in detail.

My hon. Friend the Member for Basingstoke (Mr. Mitchell) asked about the problems of small businesses and we understand that the Minister will be commenting upon this.

My hon. Friend the Member for Warwick and Leamington (Mr. Smith) asked the Minister about the new provisions for the registration of employment agencies which were announced by him during a Consolidated Fund Bill debate earlier in the year, but which at that time I thought had followed consultations with the local authority associations. We should be grateful if the Minister would indicate what the views of local authority associations are on this matter. The information that I and my hon. Friends have confirms that those associations arc opposed to this change.

My right hon. Friend the Member for Lowestoft (Mr. Prior) asked about the specific relationship between the Advisory, Conciliation and Arbitration Service and the Central Arbitration Committee. There have been comments in the Press on the vagueness of this relationship. Perhaps the Minister, with the help of those who drafted the Bill, will be able to clear up this ambiguity, which, to laymen reading the document, exists.

My hon. Friend the Member for Kidderminster (Mr. Bulmer) asked whether price increases caused by the Bill would be allowable within the terms of the prices legislation. During the debate a number of tributes have been paid to parliamentary draftsmen, and there have been some criticisms from the hon. Member for Birmingham, Perry Barr (Mr. Rooker). With this week's ration of Second Reading debates, it is a pity that parliamentary draftsmen have been so active. The Opposition would have been much happier if parliamentary draftsmen had taken longer over the drafting of Bills and perhaps had a well-earned holiday, as has been suggested. The country needs less legislation and not more legislation.

Small businesses are being put into considerable difficulty by the number of measures being passed by this House which impose upon them, as the hon. Member for Rochdale (Mr. Smith) indicated, a heavy burden in order to ensure that they remain within the law.

This is a curious Bill both for its contents and for its title. Superficially it might appear reasonable and sensible for the Government, at a time when unemployment is rising so rapidly, to come forward with a Bill to protect employment. However, we know that that superficial impression is totally misleading because the main provision of this legislation which affects employment is not yet in the Bill. It is an amendment, which we understand the Government will table, as a result of the announcement made by the Chancellor of the Exchequer in his Budget speech, about the temporary employment subsidy, which, quite clearly, would have a direct effect upon limiting and reducing—albeit in the development areas and in a restrictive sense—unemployment that would otherwise be created.

However, the original Bill had little in it at all which could have been said directly to affect employment, except perhaps adversely, for the general emphasis and thrust of the legislation will, if anything, help to create additional unemployment because of the inflationary pressures which the Bill has within it.

There have been many comments about the Minister of State's estimate of the Bill's total cost as £100 million or £120 million. The hon. Member for Luton, East (Mr. Clemitson) calculated that this might amount to¼per cent. of the total wage bill. But that is not the whole story, in the light of Clause 88 and Schedule 10. It depends which authority one consults. Eric Wigham says that he thinks that the fears about this provision are somewhat overplayed. But the Secretary of State's pet authority, whom he quoted again and again in Committee and whom he has commended in the House, Mr. John Elliot, says that this is potentially the most inflationary of the Bill's provisions. If the most inflationary provision is excluded, at least we beg leave to raise a great question mark over the calculation that we have been given.

I said that both the contents and the title of the Bill were curious. There seems to be general agreement that the Bill is grotesquely misnamed. My right hon. Friend the Member for Lowestoft suggested that it should be the "Trade Union Benefit (No. 2) Bill". The hon. Member for Birmingham, Perry Barr suggested the "Industrial Relations (No. 2) Bill". My hon. Friend the Member for Cleveland (Mr Brittan) suggested the "Employment Destruction Bill". I begin to suspect that they have been reading Bernard Levin on Clay Cross, and his remarkable series of examples of possible legislation.

My suggestion is that the Bill should be renamed the "Socialist Con-Trick Consolidation Bill". Such a description is not all that far from reality. I said that the Bill's contents were curious—an odd ragbag of TUC demands and desires over recent years. Pat Lowry, the Industrial Relations Director of British Leyland, whom I can remember the Prime Minister quoting as a considerable authority on these matters, during the 1970 General Election said that the consultative document …reads more like a series of aspirational resolutions passed at a TUC annual conference than proposals which are to become laws of the land. I would not dissent from that description.

Mr. Rooker

Does the hon. Gentleman not draw the obvious conclusion, that if, over the last few years, British Leyland had done all the things which are in the Bill, it would not have reached its present impasse?

Mr. Hayhoe

I draw the obvious conclusion that the hon. Member knows nothing of the work that Pat Lowry has been doing in British Leyland, or he would not make such a stupid remark.

Mr. Rooker

I have worked there.

Mr. Hayhoe

As we say in our amendment, some parts of the Bill reflect good industrial practice but others place on commerce and industry unfair and uneven burdens which we believe should fall upon the State to be met through taxation.

There seems to have been widespread agreement about the need for proper provision for maternity benefit, which is the norm in most EEC countries. It is questionable whether the right way to do this is to place the burden just upon the firm which employs the women concerned and not upon the men concerned. If it is to be placed upon industry, why not place the burden upon industry overall and pay the benefit to those concerned through the national insurance scheme?

This proposed provision could lead to difficulties in employment prospects for people who could qualify under these provisions. The net result of the legislation so framed may be to harm the employment prospects of some women rather than help them.

As my hon. Friend the Member for Basingstoke said, some of the Bill's provisions merely rebuild what was destroyed less than a year ago. The disclosure provisions are taken direct from the Industrial Relations Act; I am not sure that the words are not identical.

The National Industrial Relations Court is back, but now, as my right hon. Friend said, the Secretary of State, who, as we all know, is so good with words, has renamed it the "Employment Appeal Tribunal". How pleased the right hon. Gentleman must be to have thought up such a master stroke of industrial relations. Michael's miracle is to have turned "NIRC" into "EAT".

But back to the curious contents of the Bill. There are 56 clauses about the rights of employees. Not one of them deals with the rights of the employee who is adversely affected by the arbitrary, unfair or unreasonable action of trade union. Yet in our earlier debates the Secretary of State indicated that he was contemplating the possibility of putting some provision into this Bill to cover this matter. The excuses he began to produce when we were considering the Trade Union and Labour Relations (Amendment) Act on Report were very thin compared with the clear impression he had given before. It is not too late for us to try, if the Trade Union and Labour Relations (Amendment) Bill is carried, to do something in the Bill to take up this point.

I suppose if it were possible for someone to give a blank cheque and turn a blind eye at the same moment that is just what the Government are doing as regards the trade unions in the Bill as at present drawn. I suppose there is more to the Bill. We would expect from the Secretary of State that there would be a few nasty little pieces of party spite plunged into it. There is the proposal to change the Health and Safety at Work Act to ensure that only those appointed by trades unions can serve as safety representatives. That is a mean and nasty little provision. I am sorry that the Under-Secretary felt it necessary to attempt to defend it recently at Question Time. If the Bill goes into Committee, we shall attempt to get that provision removed from it.

I underline my right hon. Friend's support for the Advisory, Conciliation and Arbitration Service. However, there is a real danger that the very fragile indedendence of ACAS could be broken by the Bill. My right hon. Friend referred to the doubts over the membership of the council—three trade unionists, three employers and three academics. If the council is to have on it very eminent men from these spheres, it obviously cannot meet often. If it is to carry out its proper task, particularly as ACAS is given more responsibilities, I wonder whether a system of deputies who are able to meet fairly regularly and deal with questions and then refer matters to the main members of the council might not be the best way of ensuring the independence of the body. The independence is of absolutely crucial significance, as I am sure the Minister will agree.

What about the staff? As I understand it, they are still civil servants. Does not this mean that they perhaps have a special relationship with their colleagues in the Department from which they come? Is there absolute impartiality about the supply of information? Is the information which they give to Ministers or civil servants in the Department precisely what they would give to other responsible people—say, Members of this House—who have an interest in the matter? These questions of independence and impartiality are important.

We also criticise Clause 1(2) in singling out collective bargaining alone as being the way in which ACAS will go about its work. I prefer the description given by Jim Mortimer in a speech in Glasgow in January when he spoke of the main functions of ACAS as being advisory and information services to industry for the improvement of collective bargaining, conciliation in industrial disputes, and the provision of arbitration services". That widens it out helpfully, and I hope that amendments to this clause will he accepted.

As the clause stands, by the time we have passed it ACAS will have to be campaigning against the rest of the Bill. If the Government are to try to preserve collective bargaining above all else, big chunks of the rest of the Bill will have to be removed from the area of collective bargaining items which have traditionally been matters for voluntary agreement in industry. Therefore, it is important to agree with the whole approach of Jim Mortimer, the Chairman of ACAS, when he said that he was seeking to use the weapon of persuasion, not of statutory sanction". Yet this Bill is absolutely thick with statutory sanctions. In effect, it imposes the law in all sorts of areas where the law, at least for a period, since the repeal of the Industrial Relations Act, has not been operative. The hon. Member for Birmingham, Perry Barr made this point.

We see in Clause 65 an attempt by means of the law to enforce specific performance of a contract of employment. I understand, although I am no lawyer, that this is the first time that this dangerous extension of law has been attempted. There is the whole question of recognition procedures, and these are one-sided in favour of the unions. I suppose, as the hon. Member for Motherwell and Wishaw (Dr. Bray) indicated, that one could describe awards by the ACAS as a statutory determination of wage levels.

The law, therefore, is involved in many ways where it was not involved before. We are seeing a legal framework recruited by this Bill, rebuilding albeit in a different form what was abolished less than a year ago. The court is now to be called an appeal tribunal. This time the framework is trade union designed and trade union biased, but it is a legal framework nevertheless and it is one that could be amended.

I quote again from John Elliott's perceptive view when he said in The Financial Times on 11th April: The Bill provides a ready made basis on which a future Conservative or any other Government could build restrictions to correct the shift in the industrial power balance which employers expect the Bill to cause. Some hon. Members opposite understand how the process is going, and one follows with interest the way in which Ministers are swallowing their words. Some will remember the way in which the Secretary of State ended his speech on the Second Reading of the Trade Union and Labour Relations Bill on 7th May last year when he produced an eloquent plea for replacing, as he called it in one of the more polite phrases he used, legal prescription by peaceful persuasion. The right hon. Gentleman has eaten those words, for now we are back to legal prescription in this Bill. On item after item, the law is invoked.

I turn for a moment to Clause 99 and the question of picketing. The Minister of State said that the clause was purely declaratory and did not change the House of Lords' judgment in the Broome case. Why have it then, if it leaves things precisely as they are? Parliamentary draftsmen do not usually waste their time drafting clauses just for the sake of it.

I am filled with suspicion about why Clause 99 is in the Bill. I suspect that it is there because some hon. Members opposite below the Gangway hope that they can change it from being merely declaratory to being a provision which will change the law, and change it in a direction to which the vast majority of people would strongly object, the direction of giving additional powers to pickets to stop transport on the public highway. If that is the Government's intention, we shall oppose it root and branch in every way open to us, and I hope that at least some Government back benchers will join us in that opposition. The inclusion of Clause 99 inevitably raises substantial doubts.

As for the protection of employment, how many extra jobs will the Bill provide? Apparently, there will be 700 in the public service, but who knows how many jobs it may end? Will it increase flexibility in manning, will it do anything to increase mobility, will it improve training and retraining in industry? —hardly a thing. Will the Bill improve productivity, reduce unit costs in industry, or reduce the number of strikes or their damaging effect? If it does, that will be fine, but I see little in the Bill which is likely to do much on any of those fronts.

There is some possibility that in certain areas the Bill can have a helpful effect— we refer to this in the Opposition amendment—but it is only too likely to harm small businesses. What we have heard today makes clear that the Bill can impose a heavy burden upon small businesses, a burden which they are least able to carry at present when they are trying to digest so many other unpalatable dishes.

The monumental irrelevance of much of the Bill to the real difficulties confronting the nation is plain for all to see. Some parts of it make sense, and these will be widely supported, but generally the Bill does nothing to help solve our basic and desperate problems.

In my judgment, the Secretary of State ought to withdraw the Bill, or at least great chunks of it, and then accept the Goodman and other Lords amendments to the Trade Union and Labour Relations (Amendment) Bill which will soon be coming back to the House. How can the Government and their back-bench supporters oppose the Goodman amendment after the NUJ conference decisions last week? It is esential that those amendments be supported by the House.

If the Government would do something to back the moderates in the trade unions, that would be sensible. There is a lesson here in the affairs of the NUJ. When the more militant and less responsible people had turned up for the conference, it made one decision, but when the NUJ had a postal ballot to replace one of the senior officials of the union, Mr. Blott, there was an entirely different result. Does that not underline the advantage of postal ballots and of trying to get as big a turnout as possible in union elections?

As true democrats, we want a high turnout at all elections. Is there not something to be said—and would it not have a more helpful effect on industrial relations than a great deal of what is in this long Bill—for the Government facilitating postal ballots? They might do it perhaps by providing free postage, since it is an expensive business to hold a postal ballot with today's high cost of postage. Why not also have a statutory minimum percentage of the electorate being compelled to vote in order that the election shall be valid?

Mr. Corbett

And the shareholders.

Mr. Hayhoe

The shareholders are not disrupting the production of British Leyland. Militant shareholders did not cause disruption at the docks. That was the responsibility of trade union leaders, albeit an unofficial leadership. I am seeking to provide support for the moderates in these circumstances, and we are having an interesting reaction to that suggestion from below the Gangway on the Government side.

The Secretary of State and his junior Ministers are practically the only people left who live in the dream world of believing that the social contract is still working. The Government have more than kept their side of the bargain, but many of the unions have welshed on theirs. We know it, the Chancellor of the Exchequer knows it and the general public know it. Even the Secretary of State for Education and Science knows it, but the Secretary of State for Employment and his team do not.

Mr. Prior

They choose not to know it.

Mr. Hayhoe

The Government, led by the nose by the trade union leaders, and the Secretary of State are by this Bill giving weapons to the strong and stripping the defences of the weak. The combination of this legislation and that on trade unions and industrial relations does just that. We need much more of the approach outlined in the debate by two hon. Members, by my hon. Friend the Member for St. Marylebone (Mr. Baker), who made a carefully considered speech on how improvements could be made, and by the hon. Member for Hemel Hempstead (Mr. Corbett)—I hope that I do not cause him difficulties in saying this, but on his whole aproach to this question and his reference to the Industrial Society and to St. George's House, Windsor, and the ideas emanating from these non-political bodies, something of this sort is necessary if we are to solve our problems.

We certainly need more trust in the work place. We need better consultation, more shared information, deeper involvement and genuine participation. We need much more rational ways of resolving industrial disputes. We also need better training and retraining in industry, and we need less resistance to change. Only if we can begin to remove fear, and certainly the parts of this Bill I support do this, shall we make any progress. In so far as the Bill helps to reinforce good industrial practice it will be supported in all parts of the House. Too much of it, however, fails to pass this test. In the main it is a bonanza for the trade unions. There is too much bias in it, and that is why we shall tonight divide the House in support of the amendment.

9.29 p.m.

The Under-Secretary of State for Employment (Mr. Harold Walker)

Until I heard the speech by the hon. Member for Brentford and Isleworth (Mr. Hayhoe) I thought that the House had had a good debate. We have had inflicted upon us by the hon. Gentleman a pretty pathetic polemic, which wound up in a manner which was characteristic of the whole speech. He referred to the need for more training and retraining—and that comes a little hit rich from a member of the party which emasculated the Industrial Training Act 1964.

There have been good, thoughtful speeches from all parts of the House. Some were marred by being delivered in a spirit of rancour, and there were some intemperate, exaggerated remarks. I see that the hon. Member for Carlton (Mr. Holland) has a smile 3n his face. No doubt he is recalling his reference to industrial totalitarianism. The right hon. Member for Lowestoft (Mr. Prior) inflicted upon the House such remarks as "ill thought out" and "ill digested".

The hon. Member for Kidderminster (Mr. Bulmer) made a powerful plea for the Government—as he put it—to stop interfering with the disciplines of market forces. Market forces are not the prerogative of one side of industry. Is the hon. Member suggesting that the miners and the electricity supply workers and others in key industrial positions should exercise the full power of their market force? He should address himself to the consequences of their doing that.

Mr. Bulmer

There is a difference between a body that can exercise a monopoly and a body that cannot.

Mr. Walker

If hon. Members ask me to reply to their speeches and ask me subsequently to give way so that they can make another point while I am speaking, I shall not make much progress in answering the debate. There have been a great many points of detail and I should like to answer as many as time permits.

I welcome hon. Members' support for ACAS. The right hon. Member for Lowestoft and the hon. Member for Brentford and Isleworth said that there were parts of the Bill that they welcomed, but I must say that one had to sort through their remarks very carefully to find what those were, with the exception of the ACAS. I welcome their support, bearing in mind that it was the Conservative Party which, in 1970, withdrew conciliation facilities from industry.

Criticism has tended to concentrate on alleged bias and the imbalance between employer and worker, the burden of costs, the alleged failure to help the lower paid, and the problems for small business men. I want to answer that criticism in due course, but first I should like to answer some specific questions.

The hon. Member for Brentford and Isleworth mentioned the temporary employment subsidy. This proposal arises from Section 5 of the Employment and Training Act 1973. It does what many of us had assumed that section to do—gives power for the Secretary of State to embark on measures necessary to maintain and extend employment opportunities.

The right hon. Member for Lowestoft stressed the great importance of Community Industry. We share his view of the importance of that scheme and that is why we are taking steps to extend it.

The hon. Member for Warwick and Leamington (Mr. Smith) made an important observation. Unfortunately, he has not been present since making it at the outset of our proceedings. However, his question was important, and that is why I shall answer it. He asked why we had decided to centralise the licensing and enforcement arrangements for the private employment agencies.

The Employment Agencies Act 1973 provided that local authorities should be the licensing and enforcement bodies. In the debate on the Consolidated Fund Bill on 23rd January I said that the Government had decided that this function should not be undertaken by the Government. I am therefore surprised that Opposition Members have expressed surprise about this.

Mr. Hayhoe

I knew that the Minister had said that. I thought that it followed that there would be consultations with the local authorities. The issue was whether those consultations had taken place

Mr. Walker

I made a mistake in giving way. The hon. Gentleman anticipates the point that I am about to make. If he will be patient and restrained, uncharacteristically, he will see that I am coming to precisely that.

We announced as long ago as 23rd January the Government's intention to take over the licensing and enforcement function for private employment agencies, and I spelt out to the House in great detail why we had done so.

Mr. Hayhoe

indicated dissent.

Mr. Walker

The hon. Member has not been here on all the occasions that we have debated these matters when others have expressed surprise. When the Employment Agencies Act was before the House in 1973, the Labour Party took the view that the Government should be the licensing and enforcement authority. I am meeting the representatives of local authorities on Friday at their request to discuss the matter with them. I offered them a meeting before the date of the Second Reading was fixed but for their own good reasons and because of their commitments they chose to defer it until Friday.

I turn to the point raised by many hon. Members but specifically by my hon. Friend the Member for Luton, West (Mr. Sedgemore) and the hon. Member for Aberdeenshire, East (Mr. Henderson), namely, the position of seasonal workers, the application of the redundancy payments provisions and the prior notice provisions. I make no criticism of them, but if they look at the provisions of Clause 106(7) they will find that to be eligible for the necessary prior notice a worker must be in continuous employment for a period of 12 weeks or more, and must have agreed at the outset of his employment that that would be the duration of the employment.

The hon. Member for Aberdeenshire, East also asked how districts would be defined for the purpose of the extended provisions in relation to terms and conditions of employment. This would be entirely a matter for the Central Arbitration Committee, with the advice and information put before it in any particular case.

I congratulate my hon. Friend the Member for Birmingham, Perry Barr (Mr. Rooker) on having done his homework extremely thoroughly and gone through the Bill with a particularly fine-tooth comb. He referred to the exclusion of the over 65s from itemised statements of pay in Clause 106(8). He is right. We shall put that right. Secondly, he referred to Schedule 14, paragraph 11, dealing with the amendment of the Trade Union and Labour Relations Act. Here again, it is as he said—a piece of faulty drafting. We shall put that right. I do not know whether there is such a creature as the parliamentary proof reader, but no doubt my hon. Friend would qualify for that office.

My hon. Friend the Member for Glasgow, Maryhill (Mr. Craigen) will be pleased to know that the redundancy payments fund, far from being in debt, is well in credit, and on 14th February 1975, St. Valentine's Day, was £17,500,000 in the black. I am not sure whether it was my hon. Friend who referred to male chauvinism in Clause 45—

Mr. Craigen

Those are your words.

Mr. Walker

My hon. Friend reminds me that I paraphrased his point. I am advised by lawyers that in Acts of Parliament "male" always embraces "female". The use of the word "her" in this case would presuppose that a woman always replaced a woman. That would have tended to build into the Bill an element of sexual discrimination which I know my hon. Friend does not want.

Several hon. Members raised questions about the amendments we proposed to make, through the Bill, to the Health and Safety at Work etc. Act concerning workers' safety representatives. We have gone over this ground thoroughly on more than one occasion. I hope that hon. Members will not think me discourteous if I refer only briefly to the considerations lying behind the change. Until we introduced the Health and Safety at Work etc. Bill, Tory Members had not expressed any sympathy or support for the concept of workers' safety representatives. There was no provision in the Industrial Relations Act for such representatives. It was left to this Government to introduce that concept. What the Tories inserted in the Health and Safety at Work etc. Act was an open invitation to every breakaway union to seek roundabout spurious recognition reluctantly wrung from employers. This will have most serious consequences for industrial relations.

I say, as I said then, that there is nothing in this Bill or in the Health and Safety at Work Act to prevent an employer with an unorganised work force from entering into voluntary arrangements with them for the appointment of safety representatives and joint safety committees. I hope that the Health and Safety Commission will have regard to the Government's policy and intentions in this matter, and will not allow the provisions of the Health and Safety at Work Act to inhibit it in making the progress which we all hope that it will speedily make in bringing forward the proposed regulations.

I turn to the question of the Advisory, Conciliation and Arbitration Service and the Central Arbitration Committee. The right hon. Member for Lowestoft asked me about the relationship between them. There may well be detailed points which we can usefully discuss in Committee, but in general we intend the ACAS to be independent of the Government and the Central Arbitration Committee to be independent of both, just as the Industrial Arbitration Board has always been independent of Government and of industry. The CAC will be under the wing of ACAS for housekeeping purposes, but this will be a similar relationship to that which previously existed between the IAB and the Department. It will not affect the CAC's independence. The Secretary of State will appoint the Chairman of the CAC after consultation with ACAS.

The hon. and learned Member for Southport (Mr. Percival) asked whether there is a right of appeal from the CAC. The Bill does not provide such a right, because the decisions of the CAC are arbitral rather than judicial. It follows earlier precedents. There is no right to appeal at present under the Terms and Conditions of Employment Act 1959 from the decisions of the Industrial Arbitration Board. Nor was there any such right of appeal from decisions of the IAB under the Industrial Relations Act, where the JAB had functions, in the last resort, under the recognition and disclosure provisions.

I turn to the point raised more than once, and specifically by the right hon. Member for Lowestoft, about the Employment Appeal Tribunal. The proposals for the Employment Appeal Tribunal have been compared with the provisions relating to the National Industrial Relations Court. This comparison ignores a fundamental difference between the two bodies. The appeal tribunal will hear only appeals against decisions of industrial tribunals and of the certification officer. It will not have power to issue injunctions. It will not have an original jurisdiction. It was this function of the NIRC—not its appellate jurisdiction—which brought it into conflict with the unions and created problems. This distinction is more important than the similarities detected by right hon. Gentlemen opposite.

The right hon. Member for Lowestoft, as did several other Members, complained of the bias in favour of unions on recognition issues and, of course, in doing so they were reflecting the views already put to us by the CBI. Employers will have as much right as the unions to seek ACAS assistance under the service's conciliation and advisory powers.

As regards the recognition clauses themselves, the emphasis in the Bill is very much on conciliation and on negotiation between the parties, with CAC arbitration as a last resort should ACAS efforts to assist a settlement by conciliation remain unsuccessful. At each stage of the new procedures, the employer will have full opportunities to put his side of the case.

It is appreciated that recognition issues may arise from inter-union disputes. Again, the employer has recourse to ACAS conciliation and advisory machinery. Also, TUC affiliated unions are bound by the requirements of the TUC disputes principles and procedures, which regulate relations between unions and provide for adjudication by a TUC disputes committee if unions are unable to agree which union or unions should be recognised.

Mr. Brittan


Mr. Walker

The hon. Gentleman will forgive me if I do not give way. I have much ground to cover.

Mr. Brittan


Hon. Members

Give way.

Mr. Walker

I have been asked to reply to many points and I intend to do my best to reply to them.

It is not strictly true that as regards ACAS recommendations, all obligations are necessarily on the employers' side. Clause 12 provides that a recommendation for recognition may be subject to conditions with which the union has to comply. A conditional recommendation would become operative only after the service had satisfied itself that the conditions had been complied with.

Another provision, in Clause 13, enables an employer to apply unilaterally for a recommendation to be varied or revoked if circumstances have changed sufficiently to justify reconsideration of the recommendation.

It is true that there is ultimately no legal sanction against a union pursuing a claim by means of industrial action in spite of an ACAS or a CAC decision. However, experience shows that such sanctions do not work, and that they simply damage industrial relations. Employers should know this as well as anyone. There is no possibility under the new legislation of yet another ConMech situation arising.

I turn now to the amendment tabled by the Liberal Party. The Liberals singled out for specific criticism the alleged failure to do anything to protect home-workers, out-workers or the lower-paid by way of a statutory minimum wage". The hon. Member for Rochdale (Mr. Smith) says that these groups should be and would be better protected by a "statutory minimum wage". It is the Government's view that voluntary collective bargaining is normally the most effective means of ensuring a decent wage for working people. The TUC guidelines to negotiators recognise the problem of low pay and have established the target of a £30 minimum wage. Of course, this is a target, and in some circumstances it may not be possible to achieve it in one step. But substantial progress has none the less been made in the current pay round towards the target.

Mr. Cyril Smith


Mr. Walker

Hon. Gentlemen expect me to reply to the points they have raised, and I shall try to do so.

We have had legislation to protect lower-paid workers by statutory minimum rates since 1909. The wages councils grew out of it. More than 3 million workers—about 1 in 8 of all workers—are within scope of the wages councils and are covered by statutory minimum rates, yet they still tend to be the low paid. More than 60 years of statutory minima have done little to lift most of them even in the direction of the ranks of the better paid. All too often the "statutory minimum" has become "the rate for the job".

Mr. Cyril Smith

Does the Minister agree that the point of view he is now expressing, whilst it may be the point of view of the TUC, is not the point of view of the Transport and General Workers' Union?

Mr. Walker

I am here to present the Government's policy and that is what I am doing.

There is widespread and growing conviction that the wages council system has not succeeded in its twin objectives of protecting the lower paid and of fostering voluntary collective bargaining. This Bill provides a firm and positive response to those criticisms. First, there is provision to enable a wages council to be transformed into a statutory joint industrial council giving the parties to its proceedings more power, more self-control and a wider scope for bargaining, thus hastening progress towards voluntary collective bargaining.

Wages councils will be given power to backdate their orders to the settlement date—something which they cannot do at present and which has been rightly the source of much criticism. We are taking power to require employers within scope of wages councils to provide information to the Secretary of State—a power which, surprisingly, is lacking at present. Among other things, this will enable the wages inspectors to operate more effectively. Perhaps the most useful new proposal for low-paid workers is the extension of the provisions embodied in Section 8 of the Terms and Conditions of Employment Act, which has been readily criticised by Opposition Members during the debate.

The hon. Member for Brentford and Isleworth who wound up for the Opposition, made great play of John Elliott's article in The Financial Times. I thought at the time that if it had not been for John Elliott he would have been short of a speech, He referred to Eric Wigham's article in The Times, which I commend to hon. Members if they want an assessment of the likely costs.

Homeworkers and outworkers present a particular and perhaps neglected problem, but, as I told my hon. Friend the Member for Birmingham, Perry Barr on 18th March, we have been giving some thought to this. The CIR has made not only some critical remarks but useful comments about what might be done.

Of course, it is not true that the Bill does nothing for homeworkers. We are taking a positive step to deal with the problem, a small step but a very important one.

We are amending the definition of "worker" in the Wages Councils Act so that it clearly covers homeworkers. This will enable wages councils to provide much more effectively the protection homeworkers need. It will mean, for example, that even if it is decided that the workers in a particular wages council industry no longer need to have their earnings protected by statute, and the wages council is abolished once the Bill is passed we shall be able to keep the wages council in operation just for the homeworkers in the industry. We could not do that as the law stands. Furthermore, it will be possible, if it were thought necessary, to set up a wages council for homeworkers generally so that whatever work they do we can secure adequate minimum standards for them by statute.

In addition, we are considering the possibility of a general inquiry into the circumstances in which homeworkers are employed, and in particular what part the ACAS might play in helping towards a fuller understanding of the industrial relations and other problems involved and of the best means of making progress towards their solution.

I think that 1 have said sufficient to show how ill-founded is the first leg of the Liberal amendment. I assure the hon. Member for Rochdale—the sole representative of his party present throughout the debate— [Interruption.] I apologise. I did not see the hon. Member for Berwick-upon-Tweed (Mr. Beith). He was overshadowed by the hon. Member for Rochdale. I assure Liberal Members that I shall not ignore the other part of their amendment before I sit down.

I turn to the specific points raised by the Conservative amendment, taking the last one first, because it is not unrelated to what I have just said about the Liberal amendment. We are told that we have taken no account of the particular problems of small businesses. I doubt whether there is any hon. Member who is unmindful of, or unsympathetic to, the problems of the small business man. [Hon. Members: "Humbug."] Perhaps hon. Members will allow me to make my speech in my own way. One reason why the low paid in the wages councils industries have remained low paid is that they tend to be in small business industries. Secondly, wage rates tend to be affected by the capacity to pay of the smallest and weakest employer. Whole industries can become geared to the lowest common denominator of resources and ability to pay.

Certainly, we must not be indifferent to the problems of the small business man, but, equally certainly, we cannot allow those problems to be permanent obstacles to the achievement of a better society. Nor can we overlook that the Bill is intended to provide rights and protection for individual employees, and it would clearly be unfair to deprive them of these simply because there were very few in a particular firm.

Furthermore, employers themselves may well complain, as they do, about different statutory obligations based on arbitrary distinction regarding the size of the firm. Training levy, and the exclusion of small firms, is a case in point.

When he introduced the last Government's Code of Industrial Relations Practice, the right hon. Member for Carshalton (Mr. Carr), facing the same problem, made it clear that he had received representations from small business men who feared that they would have to bear a disproportionate burden. His answer to that was quite clear: On the question of small establishments in particular, while I appreciate their difficulties, I feel that the universal applicability of the code is a fundamental feature of it which must be retained. If we once were to depart from that, much of the influence, much of the pressure and incentive of the code would be weakened. A too-easy gateway of excuse would be opened for people not prepared to enter into it."—[Official Report, 18th October 1971; Vol. 823, c. 3911.] Just how heavily will these new obligations bear on employers? My hon. Friend in opening the debate said that if all the provisions had been fully in force last year the cost to employers would have been between £100 million and £120 million—about 10p per week per employee. But many employers already have provisions similar to some in the Bill, or even better, so even the modest extra cost I have quoted will be abated in those cases.

The House will not have overlooked that the different provisions can be introduced at different times, thus diminishing still further the impact of extra costs. The timing of the introduction will be done with full regard for the cost implications. Of the extra cost, as my hon. Friend pointed out, the biggest single item will be for the guarantee payment. Yet, we are extending to manual workers what has for many years been the automatic right of most white-collar workers.

What the Conservatives seem to fail to understand when they complain about the Bill lacking a fair balance between management and unions is that throughout their whole existence the unions have been gripped with a smouldering resentment that the whole system has been geared to the interests of employers with the balance very firmly tilted in favour of management. Certainly we are redressing something of the imbalance inherent in the whole industrial system. The inequitable discrimination against manual workers is one small part of the general inequity that has engendered resentment on the part of workers.

Nothing illustrates so clearly the Conservatives' two-faced approach to industrial relations as this very issue of different standards for managerial staffs as against those for manual workers. Yes, they are agreed that these distinctions must be eliminated, or at least diminished, but the time is never right to do so—it will always for them cost too much or tilt the balance of rights too much in favour of workers; just as in 1970 the Conservatives repeatedly proclaimed their belief in voluntary collective bargaining conducted by strong trade unions and then imposed the shackles and restraints of the disastrous Industrial Relations Act; just as they regularly make ritual noises on behalf of the low paid, the disabled, or any other disadvantaged group, but did nothing when they had power to do so; just as in recent years, when it suited their party interests to do so, they supported the need for redundancy payments, for equal pay, for legislation against sex discrimination but did nothing. Action had to come from Labour Governments.

With unerring political instinct, the Conservatives have recognised the political need to identify with each great social and economic reform of the last decade—at the historical moment that it was about to overtake or bypass them—and with the equally unfailing political characteristics of their party have groped for arguments as to why it should not be done. Perhaps inevitably, therefore, this dichotomy has manifested itself again today.

The Bill represents the second stage of our reform of industrial relations. The first was to rid industry of the disastrous Industrial Relations Act, to cleanse the statute book of the measure that paved the way to the three-day working week and the fall of a Government. The Bill is aimed at remedying some of the identifiable causes of the disorder that undeniably afflicts our industrial relations system, causes of which strikes are often only the symptoms. It is a Bill which seeks to strengthen and extend the voluntary collective bargaining on which our system must continue to be based. It is a Bill which extends to all workers long-overdue rights which hitherto have been the privilege of all too few. Above all, it is a Bill which will help to dispel the bitterness which lingers in the aftermath of the years from 1970 to 1974, a Bill which removes some of the barriers to better relationships in industry and within society.

I commend it to the House.

Question put, That the amendment be made:

The House divided: Ayes 244, Noes 270.

Division No. 191.] AYES [10.0 p.m.
Adley, Robert Gorst, John Moore, John (Croydon C)
Aitken, Jonathan Gow, Ian (Eastbourne) Morgan, Geraint
Alison, Michael Gower, Sir Raymond (Barry) Morgan-Giles, Rear-Admiral
Amery, Rt Hon Julian Gray, Hamish Morris, Michael (Northampton S)
Arnold, Tom Griffiths, Eldon Morrison, Charles (Devizes)
Atkins, Rt Hon H. (Spelthorne) Grimond, Rt Hon J. Morrison, Hon Peter (Chester)
Awdry, Daniel Grist, Ian Mudd, David
Baker, Kenneth Grylls, Michael Neave, Airey
Banks, Robert Hall, Sir John Nelson, Anthony
Bell, Ronald Hall-Davie, A. G. F. Neubert, Michael
Bennett, Dr Reginald (Fareham) Hamilton, Michael (Salisbury) Newton, Tony
Benyon, W. Hampson, Dr Keith Nott, John
Berry, Hon Anthony Hannam, John Onslow, Cranley
Biffen, John Harvie Anderson, Rt Hon Miss Oppenheim, Mrs Sally
Biggs-Davison, John Hastings, Stephen Osborn, John
Blaker, Peter Havers, Sir Michael Page, Rt Hon R. Graham (Crosby)
Body, Richard Hawkins, Paul Pattle, Geoffrey
Boscawen, Hon Robert Hayhoe, Barney Percival, Ian
Bowden, A. (Brighton, Kemptown) Heseltine, Michael Peyton, Rt Hon John
Boyson, Dr Rhodes (Brent) Hicks, Robert Pink, R. Bonner
Braine, Sir Bernard Higgins, Terence L. Prior, Rt Hon James
Brittan, Leon Holland, Philip Raison, Timothy
Brotherton, Michael Hordern, Peter Rawlinson, Rt Hon Sir Peter
Brown, Sir Edward (Bath) Howe, Rt Hon Sir Geoffrey Rees, Peter (Dover & Deal)
Bryan, Sir Paul Howell, David (Guildford) Rees-Davies, W. R.
Buchanan-Smith, Alick Howell, Ralph (North Norfolk) Renton, Rt Hon Sir D. (Hunts)
Buck, Antony Howells, Geraint (Cardigan) Renton, Tim (Mid-Sussex)
Budgen, Nick Hurd, Douglas Rhys Williams, Sir Brandon
Bulmer, Esmond Hutchison, Michael Clark Ridley, Hon Nicholas
Burden, F. A. Irving, Charles (Cheltenham) Ridsdale, Jullan
Carlisle, Mark Jenkin, Rt Hon P. (Wanst'd&W'df'd) Rifkind, Malcolm
Carr, Rt Hon Robert Jessel, Toby Rippon, Rt Hon Geoffrey
Chalker, Mrs Lynda Johnson Smith, G. (E Grinstead) Roberta, Michael (Cardiff NW)
Churchill, W. S. Jones, Arthur (Daventry) Roberts, Wyn (Conway)
Clark, Alan (Plymouth, Sutton) Jopling, Michael Ross, Stephen (Isle of Wight)
Clark, William (Croydon S) Joseph, Rt Hon Sir Keith Rossl, Hugh (Hornsey)
Clarke, Kenneth (Rushcliffe) Kaberry, Sir Donald Rost, Peter (SE Derbyshire)
Clegg, Walter Kellett-Bowman, Mrs Elaine Royle, Sir Anthony
Cockcroft, John Kershaw, Anthony Sainsbury, Tim
Cope, John Kimball, Marcus St. John-Stevas, Norman
Cormack, Patrick King, Evelyn (South Dorset) Scott, Nicholas
Corrie, John King, Tom (Bridgwater) Shaw, Giles (Pudsey)
Costain, A. P. Kitson, Sir Timothy Shelton, William (Streatham)
Crouch, David Knight, Mrs Jill Shepherd, Colin
Crowder, F. P. Knox, David Shersby, Michael
Davies, Rt Hon J. (Knutsford) Lamont, Norman Silvester, Fred
Dean, Paul (N Somerset) Lane, David Sims, Roger
Douglas-Hamilton, Lord James Latham, Michael (Melton) Sinclair, Sir George
Drayson, Burnaby Lawrence, Ivan Skeet, T. H. H.
du Cann, Rt Hon Edward Lawson, Nigel Smith, Cyril (Rochdale)
Durant, Tony Le Merchant, Spencer Smith, Dudley (Warwick)
Dykes, Hugh Lewis, Kenneth (Rutland) Speed, Keith
Eden, Rt Hon Sir John Lloyd, Ian Spence, John
Edwards, Nicholas (Pembroke) Loveridge, John Spicer, Jim (W Dorset)
Emery, Peter Luce, Richard Spicer, Michael (S Worcester)
Eyre, Reginald McAdden, Sir Stephen Sproat, Iain
Fairbairn, Nicholas McCrindle, Robert Stainton, Keith
Fairgrieve, Russell Macfarlane, Nell Stanbrook, Ivor
Fell, Anthony MacGregor, John Stanley, John
Finsberg, Geoffrey Macmillan, Rt Hon M. (Farnham) Steel, David (Roxburgh)
Fisher, Sir Nigel McNair-Wilson, M. (Newbury) Steen, Anthony (Wavertree)
Fletcher, Alex (Edinburgh N) McNair-Wilson, P. (New Forest) Stewart, Ian (Hitchin)
Fletcher-Cooke, Charles Madel, David Stokes, John
Fookes, Miss Janet Marshall, Michael (Arundel) Stradling Thomas, J.
Fowler, Norman (Sutton C'f'd) Marten, Nell Tapsell, Peter
Fox, Marcus Mates, Michael Taylor, R. (Croydon NW)
Fraser, Rt Hon H. (Stafford & St) Mather, Carol Taylor, Teddy (Cathcart)
Freud, Clement Maude, Angus Tebbit, Norman
Galbraith, Hon T. G. D. Mawby, Ray Temple-Morris, Peter
Gardner, Edward (S Fylde) Mayhew, Patrick Thatcher, Rt Hon Margaret
Gilmour, Rt Hon Ian (Chesham) Meyer, Sir Anthony Thomas, Rt Hon P. (Hendon S)
Gilmour, Sir John (East Fife) Mills, Peter Thorpe, Rt Hon Jeremy (N Devon)
Glyn, Dr Alan Miscampbell, Norman Townsend, Cyril D.
Godber, Rt Hon Joseph Mitchell, David (Basingstoke) Trotter, Neville
Goodhart, Philip Moate, Roger Tugendhat, Christopher
Goodhew, Victor Monro, Hector van Straubenzee, W. R.
Goodlad, Alastair Montgomery, Fergus Vaughan, Dr Gerard
Viggers, Peter Wells, John Younger, Hon George
Wakeham, John Whitelaw, Rt Hon William
Walker, Rt Hon P. (Worcester) Wiggin, Jerry TELLERS FOR THE AYES:
Walker-Smith, Rt Hon Sir Derek Winterton, Nicholas Mr. Adam Butler and
Walters, Dennis Wood, Rt Hon Richard Mr. Cecil Parkinson.
Weatherill, Bernard Young, Sir G. (Ealing, Acton)
Anderson, Donald Ewing, Mrs Winifred (Moray) Mackenzie, Gregor
Archer, Peter Fitch, Alan (Wigan) Mackintosh, John P.
Armstrong, Ernest Flannery, Martin Maclennan, Robert
Ashley, Jack Fletcher, Ted (Darlington) McMillan, Tom (Glasgow C)
Atkins, Ronald (Preston N) Ford, Ben McNamara, Kevin
Atkinson, Norman Forrester, John Madden, Max
Bagier, Gordon A. T. Fowler, Gerald (The Wrekin) Mahon, Simon
Bain, Mrs Margaret Fraser, John (Lambeth, N'w'd) Marquand, David
Barnett, Guy (Greenwich) Freeson, Reginald Marshall, Dr Edmund (Goole)
Barnett, Rt Hon Joel (Heywood) Garrett, John (Norwich S) Marshall, Jim (Leicester S)
Bates, Alf Garrett, W. E. (Wallsend) Mason, Rt Hon Roy
Bean, R. E. Gilbert, Dr. John Maynard, Miss Joan
Benn, Rt Hon Anthony Wedgwood Ginsburg, David Meacher, Michael
Bennett, Andrew (Stockport N) Golding, John Mellish, Rt Hon Robert
Bidwell, Sydney Gould, Bryan Mikardo, Ian
Bishop, E. S. Graham, Ted Millan, Bruce
Blenkinsop, Arthur Grant, John (Islington C) Miller, Mrs Millie (Ilford N)
Booth, Albert Grocott, Bruce Mitchell, R. C. (Soton, Itchen)
Boothroyd, Miss Betty Hamilton, James (Bothwell) Molyneaux, James
Bottomley, Rt Hon Arthur Hamilton, W. W. (Central Fife) Morris, Alfred (Wythenshawe)
Boyden, James (Bish Auck) Hardy, Peter Morris, Charles R. (Openshaw)
Bradley, Tom Harper, Joseph Morris, Rt Hon J. (Aberavon)
Bray, Dr Jeremy Harrison, Walter (Wakefield) Mulley, Rt Hon Frederick
Broughton, Sir Alfred Hart, Rt Hon Judith Murray, Rt Hon Ronald King
Brown, Robert C. (Newcastle W) Hattersley, Rt Hon Roy Newens, Stanley
Buchan, Norman Hatton, Frank Noble, Mike
Butler, Mrs Joyce (Wood Green) Hayman, Mrs Helene Oakes, Gordon
Callaghan, Jim (Middleton & P) Heffer, Eric S. Ogden, Eric
Campbell, Ian Henderson, Douglas O'Halloran, Michael
Canavan, Dennis Hooley, Frank O'Malley, Rt Hon Brian
Cant, R. B. Horam, John Orbach, Maurice
Carmichael, Neil Howell, Denis (B'ham, Sm H) Orme, Rt Hon Stanley
Carter-Jones, Lewis Hoyle, Doug (Nelson) Ovenden, John
Cartwright, John Huckfield, Les Owen, Dr David
Castle, Rt Hon Barbara Hughes, Rt Hon C. (Anglesey) Palmer, Arthur
Clemitson, Ivor Hughes, Mark (Durham) Park, George
Cocks, Michael (Bristol S) Hughes, Robert (Aberdeen N) Parry, Robert
Colquhoun, Mrs Maureen Hughes, Roy (Newport) Pavitt, Laurie
Concannon, J. D. Hunter, Adam Perry, Ernest
Cook, Robin F. (Edin C) Irvine, Rt Hon Sir A. (Edge Hill) Phipps, Dr Colin
Corbett, Robin Irving, Rt Hon S. (Dartford) Powell, Rt Hon J. Enoch
Cox, Thomas (Tooting) Jackson, Colin (Brighouse) Prentice, Rt Hon Reg
Craigen, J. M. (Maryhill) Janner, Greville Price, C. (Lewisham W)
Crawford, Douglas Jay, Rt Hon Douglas Price, William (Rugby)
Crawshaw, Richard Jeger, Mrs Lena Radice, Giles
Cronin, John Jenkins, Rt Hon Roy (Stechford) Reid, George
Cryer, Bob John, Brynmor Richardson, Miss Jo
Cunningham, G. (Islington S) Johnson, James (Hull West) Roberts, Albert (Normanton)
Cunningham, Dr J. (Whiteh) Johnson, Walter (Derby S) Roberts, Gwilym (Cannock)
Davidson, Arthur Jones, Alec (Rhondda) Robertson, John (Paisley)
Davies, Bryan (Enfield N) Jones, Barry (East Flint) Roderick, Caerwyn
Davies, Denzil (Llanelli) Jones, Dan (Burnley) Rodgers, George (Chorley)
Davies, Ifor (Gower) Judd, Frank Rodgers, William (Stockton)
Davis, Clinton (Hackney C) Kaufman, Gerald Rooker, J. W.
Deakins, Eric Kelley, Richard Rose, Paul B.
Dean, Joseph (Leeds West) Kerr, Russell Ross, Rt Hon W. (Kilmarnock)
de Freitas, Rt Hon Sir Geoffrey Kilroy-Silk, Robert Rowlands, Ted
Delargy, Hugh Kinnock, Neil Ryman, John
Dell, Rt Hon Edmund Lamble, David Sandelson, Neville
Dempsey, James Lamborn, Harry Sedgemore, Brian
Doig, Peter Leadbitter, Ted Selby, Harry
Douglas-Mann, Bruce Lee, John Shaw, Arnold (Ilford South)
Duffy, A. E. P. Lestor, Miss Joan (Eton & Slough) Sheldon, Robert (Ashton-u-Lyne)
Dunnett, Jack Lever, Rt Hon Harold Shore, Rt Hon Peter
Dunwoody, Mrs Gwyneth Lipton, Marcus Silkin, Rt Hon John (Deptford)
Eadie, Alex Litterick, Tom Silkin, Rt Hon S. C. (Dulwich)
Edge, Geoff Lomas, Kenneth Sillars, James
Edwards, Robert (Wolv SE) Loyden, Eddie Silverman, Julius
Ellis, Tom (Wrexham) Luard, Evan Skinner, Dennis
English, Michael Lyon, Alexander (York) Small, William
Ennals, David Lyons, Edward (Bradford W) Smith, John (N Lanarkshire)
Evans, Fred (Caerphilly) MacCormick, Iain Spearing, Nigel
Evans, Ioan (Aberdare) McCusker, H. Spriggs, Leslie
Evans, John (Newton) McElhone, Frank Stallard, A. W.
Ewing, Harry (Stirling) McGuire, Michael (Ince) Stewart, Donald (Western Isles)
Stewart, Rt Hon M. (Fulham) Wainwright, Edwin (Dearne V) Williams, Alan Lee (Hornch'ch)
Stoddart, David Walden, Brian (B'ham, L'dyw'd) Williams, Rt Hon Shirley (Hertford)
Stott, Roger Walker, Harold (Doncaster) Williams, W. T. (Warrington)
Strang, Gavin Walker, Terry (Kingswood) Wilson, Alexander (Hamilton)
Strauss, Rt Hon G. R. Ward, Michael Wilson, Gordon (Dundee E)
Summerskili, Hon Dr Shirley Watkins, David Wilson, William (Coventry SE)
Swain, Thomas Watkinson, John Wise, Mrs Audrey
Taylor, Mrs Ann (Bolton W) Watt, Hamish Woodall, Alec
Thomas, Jeffrey (Abertillery) Weetch, Ken Woof, Robert
Thomas, Mike (Newcastle E) Weitzman, David Wrigglesworth, Ian
Thomas, Ron (Bristol NW) Welsh, Andrew Young, David (Bolton E)
Thompson, George White, Frank R. (Bury)
Thorne, Stan (Preston South) White, James (Pollok)
Tinn, James Whitlock, William TELLERS FOR THE NOES
Tomlinson, John Wigley, Dafydd Mr. J. D. Dormand and
Tomney, Frank Willey, Rt Hon Frederick Mr. John ***
Varley, Rt Hon Eric G. Williams, Alan (Swansea W)

Question accordingly negatived.

Main Question put forthwith pursuant to Standing Order No. 39 (Amendment on Second or Third Reading), and agreed to.

Bill accordingly read a Second time.

Bill committed to a Standing Committee pursuant to Standing Order No. 40 (Committal of Bills)