Session 2012 - 13
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Other Bills before Parliament


 
 

205

 

House of Commons

 
 

Tuesday 17 July 2012

 

Public Bill Committee

 

New Amendments handed in are marked thus Parliamentary Star

 

Parliamentary Star - whiteAmendments which will comply with the required notice period at their next appearance

 

Enterprise and Regulatory Reform Bill


 

Note

 

The Amendments have been arranged in accordance with the Order of the

 

Committee [19 June 2012]

 


 

Norman Lamb

 

56

 

Page  46,  line  34,  leave out Clause 57.

 


 

Caroline Lucas

 

1

 

Clause  62,  page  49,  line  5,  at end add—

 

‘(5)    

Section [Permission to borrow from the capital markets] comes into force on the

 

day on which this Act is passed.’.

 


 

NEW CLAUSES

 

Confidentiality of negotiations before termination of employment

 

Norman Lamb

 

NC2

 

To move the following Clause:—

 

‘After section 111 of the Employment Rights Act 1996 insert—


 
 

Public Bill Committee: 17 July 2012                     

206

 

Enterprise and Regulatory Reform Bill, continued

 
 

“111A

Confidentiality of negotiations before termination of employment

 

(1)    

In determining any matter arising on a complaint under section 111, an

 

employment tribunal may not take account of any offer made or

5

discussions held, before the termination of the employment in question,

 

with a view to it being terminated on terms agreed between the employer

 

and the employee.

 

    

This is subject to the following provisions of this section.

 

(2)    

Subsection (1) does not apply where, according to the complainant’s

10

case, the circumstances are such that a provision (whenever made)

 

contained in, or made under, this or any other Act requires the

 

complainant to be regarded for the purposes of this Part as unfairly

 

dismissed.

 

(3)    

In relation to anything said or done which in the tribunal’s opinion was

15

improper, or was connected with improper behaviour, subsection (1)

 

applies only to the extent that the tribunal considers just.

 

(4)    

The reference in subsection (1) to a matter arising on a complaint under

 

section 111 includes any question as to costs, except in relation to an

 

offer made on the basis that the right to refer to it on any such question is

20

reserved.

 

(5)    

Subsection (1) does not prevent the tribunal from taking account of a

 

determination made in any other proceedings between the employer and

 

the employee in which account was taken of an offer or discussions of the

 

kind mentioned in that subsection.”’.

 

As Amendments to Norman Lamb’s proposed New Clause (Confidentiality of

 

negotiations before termination of employment) (NC2):—

 

Mr Iain Wright

 

Ian Murray

 

Chi Onwurah

 

(a)

 

Line  7,  leave out ‘the employee’ and insert ‘, the employee or either one of the

 

following chosen employee representatives—

 

(a)    

a trade union official;

 

(b)    

a workplace representative; or

 

(c)    

a legal representative.’.

 

Mr Iain Wright

 

Ian Murray

 

Chi Onwurah

 

(b)

 

Line  24,  at end add—

 

‘(6)    

The Secretary of State shall review the operation of Clause 111A [Confidentiality

 

of negotiations before termination of employment] after 12 months and shall

 

confirm its continuation through an affirmative resolution of both Houses of

 

Parliament.’.

 



 
 

Public Bill Committee: 17 July 2012                     

207

 

Enterprise and Regulatory Reform Bill, continued

 
 

Payments to directors: members’ approval of directors’ remuneration policy

 

Norman Lamb

 

NC5

 

To move the following Clause:—

 

‘(1)    

In section 421 of the Companies Act 2006 (contents of directors’ remuneration

 

report) after subsection (2) insert—

 

“(2A)    

The regulations must provide that any information required to be

 

included in the report as to the policy of the company with

5

respect to the making of remuneration payments and payments

 

for loss of office (within the meaning of Chapter 4A of Part 10)

 

is to be set out in a separate part of the report.”

 

(2)    

After section 422 of that Act (approval and signing of directors’ remuneration

 

report) insert—

10

“422A

Revisions to directors’ remuneration policy

 

(1)    

The directors’ remuneration policy contained in a company’s directors’

 

remuneration report may be revised.

 

(2)    

Any such revision must be approved by the board of directors.

 

(3)    

The policy as so revised must be set out in a document signed on behalf

15

of the board by a director or the secretary of the company.

 

(4)    

Regulations under section 421(1) may make provision as to—

 

(a)    

the information that must be contained in a document setting out

 

a revised directors’ remuneration policy, and

 

(b)    

how information is to be set out in the document.

20

(5)    

Sections 422(2) and (3), 454, 456 and 463 apply in relation to such a

 

document as they apply in relation to a directors’ remuneration report.

 

(6)    

In this section, “directors’ remuneration policy” means the policy of a

 

company with respect to the matters mentioned in section 421(2A).”

 

(3)    

In section 439 of that Act (quoted companies: members’ approval of directors’

25

remuneration report), in subsection (1), at the end insert “other than the part

 

containing the directors’ remuneration policy (as to which see section 439A).”.

 

(4)    

After that section insert—

 

“439A

Quoted companies: members’ approval of directors’ remuneration

 

policy

30

(1)    

A quoted company must give notice of the intention to move, as an

 

ordinary resolution, a resolution approving the relevant directors’

 

remuneration policy—

 

(a)    

at the accounts meeting held in the first financial year which

 

begins after the coming into force of section (Payments to

35

directors: members’ approval of directors’ remuneration policy)

 

of the Enterprise and Regulatory Reform Act 2012 or at an

 

earlier general meeting, and

 

(b)    

at an accounts or other general meeting held no later than the end

 

of the period of three financial years beginning with the first

40

financial year after the last accounts or other general meeting in

 

relation to which notice is given under this subsection.


 
 

Public Bill Committee: 17 July 2012                     

208

 

Enterprise and Regulatory Reform Bill, continued

 
 

(2)    

A quoted company must give notice of the intention to move at an

 

accounts meeting, as an ordinary resolution, a resolution approving the

 

relevant directors’ remuneration policy if—

45

(a)    

a resolution required to be put to the vote under section 439 was

 

not passed at the last accounts meeting of the company, and

 

(b)    

no notice under this section was given in relation to that meeting

 

or any other general meeting held before the next accounts

 

meeting.

50

(3)    

A notice given under subsection (2) is to be treated as given under

 

subsection (1) for the purpose of determining the period within which the

 

next notice under subsection (1) must be given.

 

(4)    

Notice of the intention to move a resolution to which this section applies

 

must be given, prior to the meeting in question, to the members of the

55

company entitled to be sent notice of the meeting.

 

(5)    

Subsections (2) to (4) of section 439 apply for the purposes of a

 

resolution to which this section applies as they apply for the purposes of

 

a resolution to which section 439 applies, with the modification that, for

 

the purposes of a resolution relating to a general meeting other than an

60

accounts meeting, subsection (3) applies as if for “accounts meeting”

 

there were substituted “general meeting”.

 

(6)    

For the purposes of this section, the relevant directors’ remuneration

 

policy is—

 

(a)    

in a case where notice is given in relation to an accounts meeting,

65

the remuneration policy contained in the directors’ remuneration

 

report in respect of which a resolution under section 439 is

 

required to be put to the vote at that accounts meeting;

 

(b)    

in a case where notice is given in relation to a general meeting

 

other than an accounts meeting—

70

(i)    

the remuneration policy contained in the directors’

 

remuneration report in respect of which such a

 

resolution was required to be put to the vote at the last

 

accounts meeting to be held before that other general

 

meeting, or

75

(ii)    

where that policy has been revised in accordance with

 

section 422A, the policy as so revised.

 

(7)    

In this section—

 

(a)    

“accounts meeting” means a general meeting of the company

 

before which the company’s annual accounts for a financial year

80

are to be laid;

 

(b)    

“directors’ remuneration policy” means the policy of the

 

company with respect to the matters mentioned in section

 

421(2A).”.’.


 
 

Public Bill Committee: 17 July 2012                     

209

 

Enterprise and Regulatory Reform Bill, continued

 
 

As Amendments to Norman Lamb’s proposed New Clause (Payments to directors:

 

members’ approval of directors’ remuneration policy) (NC5):—

 

Mr Iain Wright

 

Ian Murray

 

Chi Onwurah

 

(a)

 

Line  7,  at end insert—

 

‘(2B)    

The regulations must include information regarding the 10 highest paid

 

employees in the company outside of the board and executive committee”.’.

 

Mr Iain Wright

 

Ian Murray

 

Chi Onwurah

 

(b)

 

Leave out lines 33 to 41.

 

Mr Iain Wright

 

Ian Murray

 

Chi Onwurah

 

(c)

 

Leave out lines 42 to 52.

 

Mr Iain Wright

 

Ian Murray

 

Chi Onwurah

 

(d)

 

Leave out lines 56 to 61.

 

Mr Iain Wright

 

Ian Murray

 

Chi Onwurah

 

(e)

 

Leave out lines 68 to 76 and insert—

 

‘(6A)    

The resolution under subsection (1) in respect of directors’ remuneration policy

 

must obtain the approval of 75 per cent. of members on the share register of the

 

quoted company.’.

 

Mr Iain Wright

 

Ian Murray

 

Chi Onwurah

 

(g)

 

Line  83,  at end add—

 

‘(5)    

In section 412 of the Companies Act 2006 (Information about directors’ benefit:

 

remuneration), after subsection (2)(e) insert—

 

“(2)    

 

(f)    

disclosure of fees paid to recruitment consultants in respect of

 

recruitment consultancy work and non-recruitment consultancy

 

work for the company in the last year.”.’.


 
 

Public Bill Committee: 17 July 2012                     

210

 

Enterprise and Regulatory Reform Bill, continued

 
 

Mr Iain Wright

 

Ian Murray

 

Chi Onwurah

 

(i)

 

Parliamentary Star - white    

Line  83,  at end add—

 

‘(6)    

The Secretary of State shall, within three months of the passing of this Act, make

 

provision by regulations under section 1277 of the Companies Act 2006 requiring

 

the provision of information about the exercise of voting rights in respect of

 

directors’ remuneration policy.’.

 

Mr Iain Wright

 

Ian Murray

 

Chi Onwurah

 

(j)

 

Parliamentary Star - white    

Line  83,  at end add—

 

‘(7)    

After section 227 of the Companies Act 2006 (Directors’ service contracts), insert

 

the following new section—

 

“227A

 Appointment of remuneration consultants of public company

 

(1)    

Remuneration consultants may be appointed for each financial year of

 

the company.

 

(2)    

For each financial year for which a remuneration consultant or

 

consultants is or are to be appointed (other than the company’s first

 

financial year), the appointment must be made before the end of the

 

accounts meeting of the company at which the company’s annual

 

accounts and reports for the previous financial year are laid.

 

(3)    

The directors may appoint a remuneration consultant or consultants of

 

the company—

 

(a)    

at any time before the company’s first accounts meeting;

 

(b)    

to fill a casual vacancy in the office of remuneration consultant.

 

(4)    

The members may appoint a remuneration consultant or consultants by

 

ordinary resolution—

 

(a)    

at an accounts meeting;

 

(b)    

if the company should have appointed a remuneration consultant

 

or consultants at an accounts meeting but failed to do so;

 

(c)    

where the directors had power to appoint under subsection (3)

 

but have failed to make an appointment.

 

(5)    

A remuneration consultant or consultants of a public company may only

 

be appointed in accordance with this section.

 

(6)    

In this section a “remuneration consultant” means a person who is

 

appointed to advise on the terms of directors’ service contracts.”.’.

 



 
 

Public Bill Committee: 17 July 2012                     

211

 

Enterprise and Regulatory Reform Bill, continued

 
 

Payments to directors of quoted companies

 

Norman Lamb

 

NC6

 

To move the following Clause:—

 

‘After section 226 of the Companies Act 2006 insert—

 

“Chapter 4A

 

directors of quoted companies: special provision

 

Interpretation

 

226A  

Key definitions

 

(1)    

In this Chapter—

 

“directors’ remuneration policy” means the policy of a quoted company

 

with respect to the making of remuneration payments and payments for

 

loss of office;

 

“remuneration payment” means any form of payment or other benefit made

 

to or otherwise conferred on a person as consideration for the person

 

being, or agreeing to become, a director of a company, other than a

 

payment for loss of office;

 

“payment for loss of office” has the same meaning as in Chapter 4 of this

 

Part.

 

(2)    

Subsection (3) applies where, in connection with a relevant transfer, a

 

director of a quoted company is—

 

(a)    

to cease to hold office as director, or

 

(b)    

to cease to be the holder of—

 

(i)    

any other office or employment in connection with the

 

management of the affairs of the company, or

 

(ii)    

any office (as director or otherwise) or employment in

 

connection with the management of the affairs of any

 

subsidiary undertaking of the company.

 

(3)    

If in connection with the transfer—

 

(a)    

the price to be paid to the director for any shares in the company

 

held by the director is in excess of the price which could at the

 

time have been obtained by other holders of like shares, or

 

(b)    

any valuable consideration is given to the director by a person

 

other than the company,

 

    

the excess or, as the case may be, the money value of the consideration is

 

taken for the purposes of section 226C to have been a payment for loss of

 

office.

 

(4)    

In subsection (2), “relevant transfer” means—

 

(a)    

a transfer of the whole or any part of the undertaking or property

 

of the company or a subsidiary of the company;

 

(b)    

a transfer of shares in the company, or in a subsidiary of the

 

company, resulting from a takeover bid.


 
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© Parliamentary copyright
Revised 17 July 2012