circumstances in which an order could also be made under
another of those sections.”

(9) Schedule 6 contains provision about transitional classes.

(10) In consequence of the amendments made by this section, omit section 28 of the
5Armed Forces Act 2011.

46 Payments to employers etc of members of reserve forces

(1) In Part 8 of the Reserve Forces Act 1996 (schemes for exemption and financial
assistance), after section 84 insert—

“84A Other payments to employers etc of members of reserve forces

(1) 10The Secretary of State may by regulations provide for the making of
payments by the Secretary of State to—

(a) an employer whose employee is undertaking relevant reserve
force activities or has undertaken such activities while
employed by the employer, and

(b) 15a person carrying on business in partnership whose partner in
the business is undertaking relevant reserve force activities or
has undertaken such activities while a partner of the person,

but see subsections (3) to (5).

(2) For the purposes of this section, a person undertakes relevant reserve
20force activities when the person—

(a) is in permanent service under Part 4 or under a call-out order,

(b) undertakes training of a prescribed description while an
ordinary member of a reserve force, or

(c) performs other voluntary duties of a prescribed description
25while an ordinary member of a reserve force.

(3) The Secretary of State may make regulations under this section only if
satisfied that the payments provided for, or such payments taken
together with other measures, are likely to encourage persons—

(a) to employ, or continue to employ, members of the reserve
30forces, or

(b) to carry on business, or continue to carry on business, in
partnership with members of the reserve forces.

(4) Regulations under subsection (1)(a) may provide for the making of
payments to employers who are self-employed, but not in respect of
35their own relevant reserve force activities.

(5) Regulations under this section may not provide for the making of
payments to be conditional on a financial loss suffered by the employer
or the person carrying on business in partnership.

(6) A person making a claim under regulations under this section who is
40dissatisfied with the determination of the claim may appeal against the
determination to a reserve forces appeal tribunal.

(7) In this section—

• “ordinary member”, in relation to a reserve force, means a member
  who—

  (a)

  45is not a special member of that force, and

  Defence Reform BillPage 31

  (b)

  is not a member of that force for the purpose only of
  becoming a special member;

• “prescribed” means prescribed by regulations made under this
  section.”

(2) 5Schedule 7 contains supplementary provision.

47 Report on volunteer reserve forces

In Part 11 of the Reserve Forces Act 1996 (reserve associations), after section 113
insert—

“113A Duty to prepare report on volunteer reserve forces

(1) 10An association must prepare an annual report on the state of the
volunteer reserve forces so far as concerns the area for which the
association is established.

(2) A report on the state of the volunteer reserve forces is a report that sets
out the association’s assessment of the capabilities of the volunteer
15reserve forces, having regard to the duties that may be imposed on
members of those forces by or under this Act or any other enactment.

(3) The assessment referred to in subsection (2) must, in particular, include
the association’s views on the effect of each of the following matters on
the capabilities of the volunteer reserve forces—

(a) 20the recruiting of members for the volunteer reserve forces;

(b) the retention of members of those forces;

(c) the provision of training for those forces;

(d) the upkeep of land and buildings for whose management and
maintenance the association is responsible.

(4) 25A report under subsection (1) must also set out the association’s
assessment of the provision that is made as regards the mental welfare
of members and former members of the volunteer reserve forces.

(5) An association must send a report under subsection (1) to the Secretary
of State—

(a) 30in the case of the first report, before the first anniversary of the
day on which the last Future Reserves 2020 report prepared
before the coming into force of this section was presented to the
Secretary of State, and

(b) in the case of subsequent reports, before the anniversary of the
35day on which the first report was laid before Parliament under
subsection (6).

(6) On receiving a report under subsection (1), the Secretary of State must
lay a copy of it before Parliament.

(7) The duties under this section may, instead of being performed by an
40association, be performed by a joint committee appointed under section
116 by two or more associations in relation to their combined areas.

(8) Where by virtue of subsection (7) a joint committee has the duty to
prepare a report—

(a) references in subsections (1) to (5) to an association are to be
45read as if they were to the joint committee, and

(b) section 117(1)(a) (power to regulate manner in which functions
are exercised) has effect as if the reference to associations were
to the joint committee.

(9) In subsection (5)(a), “Future Reserves 2020 report” means a report
5prepared by the External Scrutiny Group on the Future Reserves 2020
programme.”

48 Unfair dismissal of reserve forces: no qualifying period of employment

(1) The Employment Rights Act 1996 is amended as follows.

(2) In section 108 (unfair dismissal: qualifying period of employment), at the end
10insert—

“(5) Subsection (1) does not apply if the reason (or, if more than one, the
principal reason) for the dismissal is, or is connected with, the
employee’s membership of a reserve force (as defined in section 374 of
the Armed Forces Act 2006).”

(3) 15In section 192(2)(e) (armed forces), after “104C” insert “, 108(5)”.

(4) The amendment made by subsection (2) applies only where, in relation to the
employee, the effective date of termination (as defined in section 97 of the
Employment Rights Act 1996) falls on or after the day on which this section
comes into force.

20Part 4 Final provisions

49 Extent

(1) This Act extends to England and Wales, Scotland and Northern Ireland
(subject to subsection (2)).

(2) 25The amendments and repeals made by Part 3 have the same extent as the
provisions amended or repealed (ignoring extent by virtue of an Order in
Council).

(3) The power conferred by section 158(3) of the Reserve Forces Act 1980 (power
to extend to Isle of Man) is exercisable in relation to the amendments of that Act
30made by section 44.

(4) The power conferred by section 132(3) of the Reserve Forces Act 1996 (power
to extend to Channel Islands and Isle of Man) is exercisable in relation to any
amendment of that Act that is made by this Act.

(5) The power conferred by section 384(1) of the Armed Forces Act 2006 (power to
35extend to Channel Islands) is exercisable in relation to the amendments of that
Act made by section 44.

50 Commencement

(1) Parts 1 to 3 come into force on such day or days as the Secretary of State may
by order made by statutory instrument appoint.

(2) An order under subsection (1) may appoint different days for different
purposes.

(3) No statutory instrument containing an order under subsection (1) in respect of
Part 1 (with or without provision under subsection (5)) is to be made unless a
5draft of the instrument has been laid before, and approved by a resolution of,
each House of Parliament.

(4) This Part comes into force on the day on which this Act is passed.

(5) The Secretary of State may by order made by statutory instrument make
transitional, transitory or saving provision in connection with the coming into
10force of any provision of this Act.

(6) An order under subsection (5) may make different provision for different
purposes.

51 Short title

This Act may be cited as the Defence Reform Act 2014.

SCHEDULES

Section 4

SCHEDULE 1 Exemptions relating to premises used by a contractor

Introduction

1 5In this Schedule—

• “relevant premises” means any premises used by a contractor for the
  purposes of, or for purposes which include, providing defence
  procurement services to the Secretary of State by virtue of
  arrangements mentioned in section 1;

• 10“designated premises” means relevant premises which are for the time
  being designated for the purposes of a provision of this Schedule by
  order made by the Secretary of State.

Landlord and Tenant Act 1954 (c. 56)1954 (c. 56)

2 Part 2 of the Landlord and Tenant Act 1954 (security of tenure for business
15and other tenants) does not apply to—

(a) any tenancy granted by the Secretary of State to a contractor in
respect of any land in relevant premises, or

(b) any sub-tenancy of the whole or part of the land comprised in such a
tenancy or in a sub-tenancy to which this sub-paragraph applies.

20Nuclear Installations Act 1965 (c. 57)1965 (c. 57)

3 (1) For the purposes of sections 1 and 2 of the Nuclear Installations Act 1965
(restriction of certain installations to licensed sites and prohibition of certain
operations), any site in designated premises is to be treated as a site used by
a government department.

(2) 25Sub-paragraph (3) applies if a contractor uses any site in designated
premises for a purpose which, if section 1 of that Act applied to the
contractor in relation to the site, would require the authority of a nuclear site
licence.

(3) The provisions of that Act other than sections 1 to 6 and 22 have effect as if—

(a) 30the contractor were the licensee under a nuclear site licence in respect
of the site, and

(b) any reference to the period of the licensee’s responsibility were a
reference to any period during which the contractor occupies the site.

Health and Safety at Work etc Act 1974 (c. 37)1974 (c. 37)

4 (1) The Secretary of State may by order exempt a contractor, in relation to
relevant premises or activities carried on by a contractor at relevant
premises, from any of the following—

(a) 5sections 21 to 25 of the Health and Safety at Work etc Act 1974;

(b) any other provision of Part 1 of that Act;

(c) any provision of regulations made under that Part.

(2) But an exemption may be conferred by virtue of sub-paragraph (1)(b) or (c)
only if, and to the extent that, it appears to the Secretary of State necessary
10or expedient to do so in the interests of the safety of the State.

(3) An exemption conferred by virtue of sub-paragraph (1)—

(a) may have effect generally or only in particular respects;

(b) may be expressed as having effect in relation to premises for the time
being specified in the order.

15Radioactive Substances Act 1993 (c. 12)1993 (c. 12)

5 The Radioactive Substances Act 1993 has effect, in relation to designated
premises and a contractor, as if the designated premises were occupied by
the contractor on behalf of the Crown for the purposes of the department of
the Secretary of State having responsibility for defence.

20Environmental Permitting (England and Wales) Regulations 2010 (S.I. 2010/675S.I. 2010/675)

6 The Environmental Permitting (England and Wales) Regulations 2010 have
effect, in relation to designated premises and a contractor, as if the
designated premises were used or occupied by the contractor on behalf of
the Crown for the purposes of the department of the Secretary of State
25having responsibility for defence.

Power to create other exemptions

7 (1) The Secretary of State may by order provide for exemptions for a contractor,
in relation to relevant premises or activities carried on by a contractor at
relevant premises, from any provision of subordinate legislation.

(2) 30An order under this paragraph may confer an exemption only if the
exemption corresponds or is similar to an exemption for, or immunity of, the
Crown.

(3) An exemption conferred by virtue of sub-paragraph (1)—

(a) may have effect generally or only in particular respects;

(b) 35may be expressed as having effect in relation to premises for the time
being specified in the order.

(4) In this paragraph “subordinate legislation” has the same meaning as in the
Interpretation Act 1978 (see section 21(1) of that Act).

Orders under this Schedule

8 (1) 40Orders under this Schedule are to be made by statutory instrument.

(2) A statutory instrument containing an order under this Schedule is subject to
annulment in pursuance of a resolution of either House of Parliament.

Section 7

SCHEDULE 2 Restrictions on disclosure or use of information

5Introduction

1 (1) This Schedule applies where the disclosure or use of relevant information is
restricted by an obligation of confidence.

(2) In this Schedule, “relevant information” means information obtained by the
Secretary of State (whether before or after the coming into force of this
10Schedule) under or in connection with a relevant contract.

(3) “Relevant contract” means a contract entered into by the Secretary of State at
any time before the vesting date for the purposes of defence procurement.

Disclosure between the parties etc

2 (1) The obligation does not prevent or penalise the disclosure of relevant
15information—

(a) between the Secretary of State or an authorised officer of the
Secretary of State and a contractor or an employee of or service
provider to a contractor,

(b) between a contractor and an employee of or service provider to the
20contractor, between one such employee and another, between one
such service provider and another or between one such employee
and one such service provider, or

(c) between a contractor or an employee of or service provider to the
contractor and another contractor or an employee of or service
25provider to the other contractor,

if the disclosure is necessary or expedient for the purposes of arrangements
mentioned in section 1.

(2) The obligation does not prevent or penalise the disclosure of relevant
information—

(a) 30by a former contractor or an employee of or service provider to a
former contractor to the Secretary of State or an authorised officer of
the Secretary of State,

(b) by a former contractor or an employee of or service provider to a
former contractor to a contractor or an employee of or service
35provider to a contractor, or

(c) between a former contractor and an employee of or service provider
to the former contractor, between one such employee and another,
between one such service provider and another or between one such
employee and one such service provider,

40if the disclosure is necessary or expedient for the purposes of arrangements
mentioned in section 1.

(3) The obligation does not prevent or penalise the use of relevant information
disclosed to a contractor or an employee of or service provider to a
contractor under this paragraph if—

(a) the information is used by the contractor or the employee or service
5provider for any purpose for which the Secretary of State could have
used the information, and

(b) the use of the information is necessary or expedient for the purposes
of arrangements mentioned in section 1.

Disclosure and use for audit purposes

3 (1) 10The obligation does not prevent or penalise the disclosure of relevant
information by a contractor or an employee of or service provider to a
contractor, or the use of that information by the person to whom it is
disclosed, if—

(a) the disclosure is to the Comptroller and Auditor General, or a person
15exercising an audit function of the Comptroller’s, and the
information could lawfully be disclosed to the Comptroller or that
person by the Secretary of State, or

(b) the disclosure is to an accounting officer, or a person exercising an
audit function of the officer’s, and the information could lawfully be
20disclosed to that officer or person by the Secretary of State.

(2) In this paragraph—

• “accounting officer” means an officer appointed by the Treasury under
  section 5(6) or (8) of the Government Resources and Accounts Act
  2000 (resource accounts);

• 25“audit function” in relation to the Comptroller and Auditor General,
  includes any function under Part 2 of the National Audit Act 1983
  (examinations into economy, efficiency and effectiveness).

Unauthorised disclosure of information

4 (1) This paragraph applies where—

(a) 30information is disclosed to a person in accordance with paragraph 2
or 3 (“the original disclosure”), and

(b) that person, or any other person to whom the information is
subsequently so disclosed, discloses the information otherwise than
in accordance with paragraph 2 or 3 (“the unauthorised disclosure”).

(2) 35The person making the unauthorised disclosure is to be treated for all
purposes as if that person were subject to the obligation which restricted the
original disclosure.

(3) But where the person making the unauthorised disclosure is an employee,
the information is to be treated as if it had been disclosed by the person’s
40employer.

Unauthorised use of information

5 (1) This paragraph applies where—

(a) information is disclosed in accordance with paragraph 2 to a person
other than the Secretary of State or an authorised officer of the
45Secretary of State, and

(b) the information is used by that person otherwise than in accordance
with paragraph 2(3) (“the unauthorised use”).

(2) The person making the unauthorised use is to be treated for all purposes as
if that person were subject to the obligation which restricted the use of the
5information by the Secretary of State.

(3) But where the person making the unauthorised use is an employee, the
information is to be treated as if it had been used by the person’s employer.

Interpretation: general

6 In this Schedule—

• 10“ancillary services” means services certified by the Secretary of State to
  be services appearing to the Secretary of State to be calculated to
  facilitate, or to be conducive or incidental to, arrangements
  mentioned in section 1;

• “authorised officer”, in relation to the Secretary of State, means an
  15officer of the Secretary of State who is authorised by the Secretary of
  State to disclose or (as the case may be) obtain the information in
  question;

• “former contractor” means a company which has been a contractor;

• “relevant information” has the meaning given by paragraph 1(2);

• 20“service provider”, in relation to a contractor or former contractor,
  means—

  (a)

  a person who performs ancillary services for that contractor,
  and

  (b)

  an employee of such a person.

Section 10

25SCHEDULE 3 Transfer schemes under section 10

Transfer of property, rights and liabilities

1 (1) On the transfer date, the designated property, rights and liabilities that are
to be transferred from the transferor to the transferee are transferred and
30vest in accordance with the transfer scheme.

(2) The rights and liabilities that may be transferred by a transfer scheme
include those arising under or in connection with a contract of employment.

(3) A certificate by the Secretary of State that anything specified in the certificate
has vested in a person by virtue of a transfer scheme is conclusive evidence
35of that fact for all purposes.

Provision that may be made by a transfer scheme

2 (1) A transfer scheme may make provision—

(a) for anything done by or in relation to the transferor in connection
with any property, rights or liabilities transferred by the scheme to
40be treated as done, or to be continued, by or in relation to the
transferee;

(b) for references to the transferor in any agreement (whether written or
not), instrument or other document relating to any property, rights
or liabilities transferred by the scheme to be treated as references to
the transferee;

(c) 5about the continuation of legal proceedings;

(d) for transferring property, rights or liabilities which could not
otherwise be transferred or assigned;

(e) for transferring property, rights and liabilities irrespective of any
requirement for consent which would otherwise apply;

(f) 10for preventing a right of pre-emption, right of reverter, right of
forfeiture, right to compensation or other similar right from arising
or becoming exercisable as a result of the transfer of property, rights
or liabilities;

(g) for dispensing with any formality in relation to the transfer of
15property, rights or liabilities by the scheme;

(h) for transferring property acquired, or rights or liabilities arising,
after the scheme is made but before it takes effect;

(i) for apportioning property, rights or liabilities;

(j) for creating rights, or imposing liabilities, in connection with
20property, rights or liabilities transferred by the scheme;

(k) for requiring the transferee to enter into any agreement of any kind,
or for a purpose, specified in or determined in accordance with the
scheme;

(l) which is the same as or similar to that made by the TUPE regulations,
25in a case where those regulations do not apply in relation to the
transfer.

(2) Sub-paragraph (1)(b) does not apply to references in primary legislation or
subordinate legislation.

Compensation

3 30A transfer scheme may contain provision for the payment of compensation
by the Secretary of State to any person whose interests are adversely affected
by it.

Foreign property

4 (1) Where a transfer scheme transfers foreign property or a foreign right or
35liability, the transferor and the transferee must take all necessary steps to
ensure that the vesting of the foreign property, right or liability in the
transferee by this Schedule is effective under the applicable foreign law.

(2) Until the vesting of the foreign property, right or liability is effective under
the applicable foreign law, the transferor must—

(a) 40hold the property or right for the benefit of the transferee, or

(b) discharge the liability on behalf of the transferee.

(3) Nothing in sub-paragraph (1) or (2) prejudices the effect under the law of a
part of the United Kingdom of the vesting of any foreign property, right or
liability in the transferee in accordance with a transfer scheme.

(4) 45Where—