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Ms. Richardson : The hon. Gentleman should conduct a seminar, in his capacity as a chartered accountant, to tell Members of Parliament how to tackle the Revenue on behalf of their constituents. I have certainly never come across such a case.
Mr. Hawkins : It is simple. One merely appeals against an assessment and if one wins the appeal, interest will be awarded against the Inland Revenue.
It is a side issue whether the Revenue pays, as well as receives, interest. The important point is that it is not normal in legislation for interest to be paid from the date of the event--from the date on which it is owing. I should love someone to comment on what Mr. Justice Popplewell said. The injustice to which I believe he was referring was not the payment of interest from the date of the court case ; it was the payment of interest in the case where employers purposely delayed the case, sometimes for three years, and so deprived the person who should have received money of the interest that he could easily have earned in a building society. That is the injustice which we have been asked to put right but which, I am sad to say, we do not put right in the Bill.
Ms. Richardson : To return to the Inland Revenue point, perhaps we are talking about two different angles. The hon. Members for High Peak (Mr. Hawkins) and for Richmond and Barnes appear to be thinking of different circumstances. Suppose that a person claims that he or she has been overpaying tax, engages an accountant--or anyway knows how to proceed--and goes to appeal. The
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outcome of that appeal may be a decision that interest is payable. I can envisage that happening. But I am thinking about a different kind of case, in which the Revenue has written to someone saying, "Dear Sir"--it is never "Dear Sir or Madam"--"We have found that we have made a mistake. We owe you £200, which we took from you wrongly in 1978." In that case, it is not a question of going to appeal ; the Revenue has admitted its mistake. But even if one writes to the Revenue and says, "You owe that person interest," the person never gets the interest out of the Revenue. I beg the hon. Members for High Peak and for Richmond and Barnes to think about that point. We are not talking about the professional cases in which the taxpayer goes to appeal. That is different, I agree.Mr. Rogers : That is an award.
Ms. Richardson : Yes, it is an award.
Let me return to the main point, as I want to leave time for the Member for Orkney and Shetland to reply--
Mr. McCartney : Conservative Members may not concede the point about the Inland Revenue but we should draw the Minister's attention to the booklet issued by the Department of Employment about industrial tribunal procedures, page 11 of which deals with the award of costs or expenses. It advises employees about the awards of costs and expenses against them and says :
"an award of costs may follow a warning given at a pre-hearing assessment."
I referred to that in my remarks. It continues :
"This may apply even if the application is withdrawn and the case does not go on to a hearing."
That clearly states that an employee can have costs awarded against him backdated to the date on which the application was made. The calculation could only be made from that date. The award of costs could only be for the period from the date on which the application was made to the date on which it was withdrawn. The point is already conceded in respect of employees in the Department's own booklet, yet the Government are still not prepared to meet the request in respect of employers.
Ms. Richardson : My hon. Friend has made an excellent point, and I hope that the Minister will look again at the booklet, in which the position is simply stated. I hope that the Minister will think again. The hon. Member for Orkney and Shetland has made a good and honest attempt, and introduced a very good debate, in trying to persuade the Department of the justice of what he and we believe.
I hope that the House will support new clause 19. If it is in some way defective, the Minister can have it redrafted and then reintroduce it on another occasion. It is not good enough for him simply to say that the first part of the new clause is not necessary because, at some future date, he will lay an order and with little explanation to say that the second part is not acceptable.
Mr. Wallace : This has been a somewhat longer debate than I had anticipated, but, as the hon. Member for Barking (Ms. Richardson) said, it has been a good debate. I welcome the Opposition's support for the new clause. It is regrettable that the Minister's response was so brief and so dismissive. I welcome his announcement that the
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long-awaited regulations will be tabled in the not-too-distant future. However, I am sure that he would accept that that goes only a small way towards what the new clause seeks to achieve.A fair point was made about why the position should be any different between the Inland Revenue charging interest and an employee charging interest when the payment has been delayed for some considerable time and he has, therefore, lost the opportunity of gaining interest on that capital. Part of the purpose of the new clause is to rectify that position. If someone has pursued a claim for redundancy through an industrial tribunal and been given a lump sum award at that time, he could have invested it and gained interest. Why should he be denied interest on that money which, over some years--or even one year with the current rate of inflation under this Government--has been devalued? I disagree with the suggestion of the hon. Member for Makerfield (Mr. McCartney) that there should be some penalty. Interest is not a penalty ; it is a fair sum.
Mr. Leadbitter : The hon. Gentleman is on the right track. The date of that award is neither significant nor pertinent because the award itself relates to dismissal. Interest on the award should therefore be payable from the date of dismissal.
Mr. Wallace : The hon. Gentleman is right. I am not trained in English law, but Professor David Walker, an eminent professor of Scots law, said in the second edition of his work on delict : "Accordingly the earliest date from which interest may be ordered to run is the date when the right of action arose."
The word "may" makes it discretionary and what the new clause proposes is discretionary.
This is the United Kingdom Parliament, and if the Minister feels uneasy because the new clause does not coincide with what he knows to be English law, I ask him to think again because it may well coincide with what Professor Walker says is possible under Scots law. It is not intended in any way to be a penalty ; it is intended to ensure justice and fairness. In the absence of any assurance that that point is taken on board by the Government, we will press the new clause to a Division.
Mr. Nicholls : Even in this relatively short debate a number of important points have been raised to which I wish to respond. It is obvious to me, if not to every hon. Member in the Chamber, that the Opposition have been pushing at an open door. The principle of interest being payable on awards made by industrial tribunals was conceded in the 1982 Act, which amended the 1978 Act. It has now been conceded in practice because the Government are consulting about a scheme for the payment of interest.
The hon. Member for Barking (Ms. Richardson) posed the perfectly fair question, why bother to do it that way when an appropriate Bill is going through Parliament? We believe that we have something rather better than a Bill--a statute with an order-making power. We have gone out to consultation and said that we will introduce a scheme later this year. So the principle was conceded as long ago as 1978 and the practice has now been conceded as well.
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11.30 pmThe only point of difference between the hon. Gentleman and me is whether such a scheme should provide for the payment of interest as from the date of judgment or whether it should be from the date of wrongdoing. I heard what my hon. Friends said about the Inland Revenue. That is not an appropriate analogy. Insofar as it was appropriate, it was an expert opinion from chartered accountants. It was advice which on this occasion was free. Free advice from chartered accountants is a treasure much to be prized. My hon. Friend was wrong about interest being payable.
By far the better example was the reference to court cases by the hon. Member for Orkney and Shetland. The point about court cases is that the general rule is that interest runs from the time of judgment. In exceptional circumstances it can run from the time of wrongdoing, but in practice that happens only in exceptional circumstances because inevitably it can take a considerable time to get the hearing to court.
A great deal of play has been made of the Caledonian Mining case and the remarks of Mr. Justice Popplewell. One dislikes to blur an interesting debate by referring to facts, but the point about that case is that reference was made in the judgment to the plaintiffs having been kept out of their money for three years. That was the time it took from the case being heard at first instance until it was disposed of on appeal. It took only a few months to get the case to the tribunal. So the blot on justice that has been referred to time and time again relates not to the time in tribunals where cases are heard relatively quickly but to the date of judgment. That is the usual position. That is what applies in courts of law. That is why I say in this case that the Opposition are pushing at an open door. Mr. Wallace rose --
Mr. Nicholls : I will give the hon. Gentleman the last chance.
Mr. Wallace : The Minister has conceded that it is more appropriate to look to courts but he said that there were exceptional circumstances where interest would be allowed from a date preceding the date of judgment. The new clause allows discretion. It is not mandatory. I accept that the presumption is in favour of it. I would see it as being very much second best, but would the Minister be more disposed towards the new clause if the presumption was reversed and the person had to argue for it? That would be better than what the Minister proposes, although it would not go as far as I would wish. Is the Minister prepared to consider that?
Mr. Nicholls : Obviously the hon. Gentleman is finally accepting that there is more force in what I said--
Mr. Haynes : On a point of order, Mr. Deputy Speaker. Is it right and proper for the Minister, during a debate of this kind, to say to an hon. Member that he will give him the last chance? I am asking for a ruling from the Chair. The way the Minister is carrying on is shocking, and I think you ought to tell him so, Mr. Deputy Speaker.
Mr. Deputy Speaker (Sir Paul Dean) : I have heard nothing out of order from the Minister.
Mr. Nicholls : As the hon. Member for Orkney and Shetland well knows, we are dealing with a structure of tribunals where a case can be heard quickly, as opposed to
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a court where it can take a considerable time. That is the significant difference, and that is why I cannot go all the way with the hon. Gentleman.Mr. Rogers : I am participating in the debate at this stage because of the remark by the Minister about giving the hon. Member for Orkney and Shetland (Mr. Wallace) the last chance to speak. It is not the Minister who determines the length of debate.
The only reason the Government are not prepared to accept the new clause seems to be because of their political prejudice and deep-seated dogma on industrial relations. The whole basis of their presentation of the Bill is that they want to argue employer, good--employee, bad. If any hon. Member makes a constructive suggestion that would improve the Bill, as the hon. Member for Orkney and Shetland did, we see immediately the hackles of prejudice and dogma rise on the backs of Ministers.
It does not matter that my hon. Friend the Member for Makerfield (Mr. McCartney) or the hon. Member for Orkney and Shetland have put forward their case in a proper fashion. The Opposition's attitude to the debate is, in a sense, cynical, because we know that the Minister will not accept any proposition that is reasonably based. When the Minister puts forward instances to justify the case, he does it without a sense of common justice and fair play. The litigants whom we are thinking about in this situation are ordinary people, who often receive wages, and who are involved in disputes, or, perhaps, are made redundant because of circumstances that are beyond their control. They are suddenly confronted with their employers being difficult and do not want--to use an expression that we use in the valleys--to give them their fair due for their legitimate rights. Let us suppose that a person is entitled to £2,000 for a period of service of employment and, perhaps, an even longer period of future unemployment. If the employer is difficult, he can drag the matter out, as mentioned by the hon. Member for Orkney and Shetland, and by the time--at the Government's present rate of inflation--that £2,000 is paid, under the proposals in the Bill it could be worth considerably less. On the basis of common justice and fair play, it should be paid at the time that the person is due the money. It is not beyond an employer who is devious, or even just cheap- -the sort of person who supports the Conservative party--to delay, knowing that at the end of the day the amount of money that he will pay out will be worth much less than at the time when it should have been paid.
The Government are wrong in not accepting this reasonable new clause. I know that if we argued right through the night we would not convince this Minister--the Minister who during the past year stood at the Dispatch Box and suggested that women should work in the coal mines, which was something that most people thought had gone out in the last century. A Minister who can justify that proposition could justify anything. One thing that I would not look for from this Minister is
Mr. McCartney : On the question of compensation and its fairness, even when compensation must be paid, for example, when an employer refuses to make a reinstatement at the end of a tribunal--when an employee has sought reinstatement and not a financial contribution--in the calculation of the compensation for the failure to reinstate, there is a statutory requirement on the employee
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to prove that within the period leading up to the tribunal he has sought gainful employment. If that is not proven, the compensation can be reduced accordingly. Therefore, at all stages in the procedure there is an obligation on the employee that will determine the final amount of compensation. If that is the case for the employee, this minimal requirement on the employer should be accepted by the Minister.Mr. Rogers : Yes, but my hon. Friend should not be surprised by the ethic put forward by the Government. It underlies the Government's attitude. They try to project that they are in support of individuals, that they protect individuals and that they want to look after individuals, but, of course, that is only applicable if the individual can buy into the legal system--if he can afford the legal system. For so many individuals the only way that they can get into the legal system is by forming associations or affiliations, such as trade unions. However, the Government have attacked trade unions and their ability to defend individuals. It is a concerted political attack based on their prejudices and political dogmas.
Mr. McCartney : My hon. Friend makes an interesting point about the Government's political dogma. Perhaps they do not want interest to be paid from the date of dismissal because of the Chancellor's high interest rate policy and the damage that will be done to employers who lose a case.
Mr. Rogers : I agree with my hon. Friend. The Government are concerned with, for example, the right of individuals in Poland to form themselves into a trade union. They mouth hypocritical statements about the rights of trade unions and blows for democracy. At the same time, they use the power of the state over individuals who want to exercise their trade union rights in this country. The Government's pathological hatred of trade unions goes back to the Heath Government. We know its basis. I do not expect any common justice from the Government or the Minister. The time for reasonable arguments and debate in the Chamber has gone. On many issues, the Government say no, no, no. They decide where they want to go. The way in which the Government are trying to destroy the Health Service is just another symptom of their dogma. We are seeing in the Government's intransigence and negativeness their political prejudice and dogma. There has never been a more dogma-ridden Government in this century. I hope that we will press the motion to a vote.
Mr. Rogers : The hon. Member has agreed. Unless one of my colleagues speaks in the debate, the Division will come fairly soon.
Mr. Leadbitter : I notice that, in responding to the debate, the Minister appeared to have a brief before him. He appeared to present to the House something on which his mind was already made up. That is out of character for him.
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Mr. Leadbitter : It is out of character because we are not asking a great deal in new clause 19. We are saying that the general principle has been accepted. We are talking only about the time scale. The Minister referred to a state of wrongdoing. Once the tribunal makes a declaration in favour of an applicant--in this case, the employee--that state of wrongdoing is removed. The question is whether in a state of equity the person who has been given the award should have simple interest from the date of judgment or from the date of dismissal. The state of wrongdoing has been removed. Therefore, the new clause gives the Minister another point in his favour. If an employer can show just cause why interest shall not be paid from the date of dismissal, the tribunal will uphold his decision. Why are the Government intervening in a democratic process? In effect, the tribunal says to the employer, "Your state of wrongdoing vis-a-vis the employee has been removed". It may take months for an employee to get his case before the tribunal, through no fault of his, so why cannot the award be bolstered by a state of equity, natural justice--whatever one calls it-- and an innocent employee given simple interest from the date of dismissal?
Mr. McCartney : Will my hon. Friend refer to paragraph 6(b) of the new clause which says that interest shall not be awarded before "in the case of a redundancy payment, the relevant date defined by section 90 of this Act ;"?
It raises a curious anomaly in the Minister's case. If a redundancy took place, redundancy payments would be paid from the date of the redundancy, but if an appeal were made to a tribunal which decided that the redundancy was not a redundancy but an unfair dismissal, unless the new clause was accepted, the award would not start from the date of the redundancy, as a redundancy notice would require under the Employment Bill, but from the date of the tribunal. It would be completely wrong if, having proved at a tribunal that a redundancy did not exist, compensation was awarded only from the date of the tribunal, not the redundancy.
Mr. Leadbitter : My hon. Friend is correct. About a year ago an employee found himself in a difficulty, not of his own making, but due to a personality conflict between him and his chief officer. The young man went to a tribunal and was exonerated. However, when he returned to the local authority, which I shall not name because it would be imprudent to do so, it remained adamant and did not provide a response to the tribunal's decision.
Ordinary working people are not lawyers, but depend entirely upon their occupation. Therefore, they go to a tribunal in a state of complete innocence. They do not know what is going to happen. But those on the tribunal who professionally consider a person's predicament and decide to award in his or her favour are saying that he or she has been relieved of a state of wrongdoing. If the process has taken several months, it seems, in equity, that the award is intended to refer to the date of dismissal, not of the award. I do not wish to take up too much time tonight, and the Minister may be unable to respond, but I wish to make the point that the Minister had a brief. I understand that because I have been here long enough. I am not recriminating the Minister ; that is the last thing that I want
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to do. However, I would like to feel that the Minister will return to his Department and discuss the mood of the House with the Secretary of State for Employment.On both sides of the House there is substance in the idea that an ordinary working person, having been exonerated by an award, could reasonably expect the award and the simple interest to come from the date of dismissal.
Mr. Rogers : I notice that when my hon. Friend appeals to the better nature of the Minister and Conservative Members, as he has in his speech, all he had by way of response was a rather cynical grin. I do not wish to make a personal statement against my hon. Friend, but I wish that he would not accord to Conservative Members virtues that do not belong to them. To suggest that they are reasonable people who will accept a reasonable case is not valid. They are motivated by political dogma and prejudice, and all the reasonable arguments that may be advanced fall on deaf ears.
Mr. Leadbitter : I understand my hon. Friend's view, but we are dealing with a limited number of cases, although it may vary according to the time of year. We are dealing with ordinary working people. I feel that I know the House of Commons. If the Minister is not in a position to give an undertaking now, I hope that he will understand the temper of the House. We are asking for something very small, although the principle is very important. If an hon. Member on either side of the House was placed in the position of an employee going before a tribunal and gained an award, would he find it difficult to understand that that award should apply from the date of dismissal and not from the date of the tribunal's judgment? I hope that the Minister will discuss the matter with the Secretary of State. It is not important to him as a Minister, or to me, or to any hon. Member on either side of the House ; we occupy favoured positions as elected Members of the House of Commons, and we are very well off. But we are talking about people who may be very poor indeed, and who need the benefit of our prudence.
Mr. Clelland : My hon. Friend the Member for Hartlepool (Mr. Leadbitter) has appealed to the Minister to look to the justice of the case being put forward. I feel, however, that here we are dealing not with justice but with attitudes. My hon. Friend the Member for Rhondda (Mr. Rogers) is quite right in that repect.
We may speak of the simple justice of giving someone interest on money that he may have been owed for a considerable time--for such cases are often delayed in the way described by my hon. Friend the Member for Makerfield (Mr. McCartney). We are discussing not only the payment of interest but the payment of the compensation itself, and often such compensation is inadequate, not only in terms of meeting the wrongdoing often involved in unfair dismissal or the denial of redundancy payments, but in terms of meeting the lost earnings that may have resulted.
In Committee, I drew the Minister's attention to a case on record in which an industrial tribunal found that an applicant had been unfairly dismissed. Winding up the case, the chairman said that had it not been for the legal maximum he would have been entitled to far more compensation, and that the tribunal would have wished to give him far more. Although such remarks were made by people who had been through the facts of the case, the
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Minister was not willing to give way to that argument, and it is even less likely that he will give way to the argument being put tonight.Mr. Rogers : I have been arguing on the basis that the Minister will not give way to any argument, because of his prejudices and dogma. One reason why he is not giving way on this issue may be what could loosely be termed political childishness. When he gave the hon. Member for Orkney and Shetland (Mr. Wallace) what he thought was his "last chance" to speak--some last chance that was--the Minister said that he had already conceded the point in principle, and that the Government were prepared to bring in the measure in an order at a later stage. Before my hon. Friend sits down, perhaps he will reflect on the motives behind the Government's attitude.
Mr. Clelland : Part of the problem is that when perfectly reasonable arguments are made by the Opposition in Committee or in the House, the Minister sees it as his job not to listen to them, and then to say, "That sounds all right to me. We may not agree with the wording, but we shall devise something that will better fit the Bill, " but rather he takes a macho view and considers that his task is to defeat the Opposition rather than to produce reasonable legislation. The attitude to which my hon. Friend the Member for Rhondda drew attention was amply displayed when we debated that part of the Bill dealing with employment rights.
Mr. McCartney : Perhaps my hon. Friend will probe the Minister as to his attitude towards the Employment Act 1982--the Tebbit Act--under which retrospective payments amounting to £2 million were made to 400 people who alleged unfair dismissal because of their refusal to join a trade union, when their cases had already been dismissed at tribunal hearings. Nevertheless, sections 1 and 2 of that Act enabled them retrospectively to enjoy huge awards.
Mr. Clelland : The Government's prejudices are well known, and my hon. Friend draws attention to a particular case that illustrates them. The Government have shown on many occasions that they can twist the law to favour their particular prejudices, while denying justice to those entitled to it.
In Committee, we suggested that from day one of their employment, people should be entitled to the full range of employment rights. The Minister's argument against that proposal was that employees would use those rights against their employers. That revealed that the view of the Minister and of the Government is that such rights serve not to protect employees against their employers but as weapons for employees to use against their employers. That reveals a great deal about the Minister's psychology when it comes to industrial relations, and says much about why he will not accept the justice for which the proposed new clause provides.
Question put, That the clause be read a Secondtime :--
The House divided : Ayes 60, Noes 154.
Division No. 224] [11.57 pm
AYES
Alton, David
Armstrong, Hilary
Barnes, Harry (Derbyshire NE)
Barron, Kevin
Battle, John
Beith, A. J.
Bell, Stuart
Blunkett, David
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Bruce, Malcolm (Gordon)Buckley, George J.
Clay, Bob
Clelland, David
Crowther, Stan
Cryer, Bob
Cunliffe, Lawrence
Davis, Terry (B'ham Hodge H'l)
Dixon, Don
Evans, John (St Helens N)
Fearn, Ronald
Flynn, Paul
Foster, Derek
Fraser, John
George, Bruce
Godman, Dr Norman A.
Golding, Mrs Llin
Haynes, Frank
Home Robertson, John
Howells, Geraint
Hoyle, Doug
Hughes, John (Coventry NE)
Illsley, Eric
Kennedy, Charles
Leadbitter, Ted
Lewis, Terry
Livsey, Richard
McCartney, Ian
McKay, Allen (Barnsley West)
Meacher, Michael
Meale, Alan
Michael, Alun
Michie, Mrs Ray (Arg'l & Bute)
Mowlam, Marjorie
Nellist, Dave
Pike, Peter L.
Powell, Ray (Ogmore)
Prescott, John
Redmond, Martin
Richardson, Jo
Rogers, Allan
Salmond, Alex
Skinner, Dennis
Smith, Andrew (Oxford E)
Smith, J. P. (Vale of Glam)
Snape, Peter
Steel, Rt Hon David
Strang, Gavin
Wareing, Robert N.
Welsh, Andrew (Angus E)
Welsh, Michael (Doncaster N)
Wise, Mrs Audrey
Tellers for the Ayes :
Mr. Archy Kirkwood and
Mr. James Wallace.
NOES
Alexander, Richard
Alison, Rt Hon Michael
Amos, Alan
Arbuthnot, James
Arnold, Jacques (Gravesham)
Ashby, David
Aspinwall, Jack
Baldry, Tony
Batiste, Spencer
Bennett, Nicholas (Pembroke)
Bevan, David Gilroy
Blaker, Rt Hon Sir Peter
Boswell, Tim
Bottomley, Peter
Bottomley, Mrs Virginia
Braine, Rt Hon Sir Bernard
Brazier, Julian
Bright, Graham
Butterfill, John
Carlisle, Kenneth (Lincoln)
Carttiss, Michael
Chapman, Sydney
Coombs, Anthony (Wyre F'rest)
Cope, Rt Hon John
Davis, David (Boothferry)
Devlin, Tim
Dorrell, Stephen
Douglas-Hamilton, Lord James
Durant, Tony
Evennett, David
Fallon, Michael
Favell, Tony
Fishburn, John Dudley
Forman, Nigel
Forsyth, Michael (Stirling)
Forth, Eric
Fowler, Rt Hon Norman
Freeman, Roger
French, Douglas
Gardiner, George
Garel-Jones, Tristan
Gill, Christopher
Glyn, Dr Alan
Goodson-Wickes, Dr Charles
Gow, Ian
Greenway, John (Ryedale)
Griffiths, Sir Eldon (Bury St E')
Griffiths, Peter (Portsmouth N)
Gummer, Rt Hon John Selwyn
Hague, William
Hamilton, Hon Archie (Epsom)
Hamilton, Neil (Tatton)
Hampson, Dr Keith
Hanley, Jeremy
Hargreaves, A. (B'ham H'll Gr')
Hargreaves, Ken (Hyndburn)
Harris, David
Hawkins, Christopher
Heddle, John
Heseltine, Rt Hon Michael
Hind, Kenneth
Howarth, Alan (Strat'd-on-A)
Howarth, G. (Cannock & B'wd)
Hughes, Robert G. (Harrow W)
Hunt, David (Wirral W)
Irvine, Michael
Jack, Michael
Jackson, Robert
Jones, Gwilym (Cardiff N)
King, Roger (B'ham N'thfield)
Kirkhope, Timothy
Knapman, Roger
Knight, Greg (Derby North)
Knight, Dame Jill (Edgbaston)
Knowles, Michael
Knox, David
Lee, John (Pendle)
Lightbown, David
Lilley, Peter
Lloyd, Peter (Fareham)
Lyell, Sir Nicholas
Macfarlane, Sir Neil
Maclean, David
McLoughlin, Patrick
McNair-Wilson, P. (New Forest)
Malins, Humfrey
Martin, David (Portsmouth S)
Maude, Hon Francis
Maxwell-Hyslop, Robin
Mayhew, Rt Hon Sir Patrick
Meyer, Sir Anthony
Miller, Sir Hal
Mills, Iain
Mitchell, Andrew (Gedling)
Mitchell, Sir David
Moore, Rt Hon John
Morrison, Sir Charles
Moss, Malcolm
Moynihan, Hon Colin
Neubert, Michael
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