House of Commons Hansard Debates for 9 Feb 1994

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New clause 3

Non-abatement of statutory provisions

(1) Any provision in an agreement between a shop worker and his employer (whether a contract of employment or not) shall be unenforceable to the extent that it purports

(a) to exclude or limit the operation of any provision of this Act, and

(b) to preclude any person from presenting a complaint to or from bringing any proceedings before an industrial tribunal under any provision of this Act.

(2) For the purposes of this section "shop worker" has the same meaning as in Schedule 4 below.'.-- [Mr. Purchase.]

Brought up, and read the First time.

10.15 pm

Mr. Purchase : I beg to move, That the clause be read a Second time- - [Interruption.] Conservative Members may wish this to be a mere formality, and I am anxious to oblige them so that they can rush away to their clubs, but they would only have to rush back again later. [ Hon. Members :-- "They are not rich enough."] No, they are not.

The new clause ensures that any worker protection in the Bill is underwritten and cannot be abated. Let me explain to hon. Members who may not have experienced the difficulties of employer-employee relationships. Let us suppose that the Government had been generous this evening and had accepted some of the modest amendments that we proposed--for example, double time for working on Sunday.

Although we know that, in many instances, the basic rate of pay is low, and that twice times not a lot is still not a lot, it is clear that the employer may well cuddle up to the employee and suggest not only that he or she may work on Sunday, but that the employer could perhaps find them a couple of hours on a Saturday as well. Under the new, totally unregulated shopping proposals that will come before the House shortly, an employer might even suggest that the employee could work a couple of evenings as well, saying, "If you'll work without wanting double time on Sunday, I'm sure I can accommodate your additional needs," which will lead to more income in one way or another.

The new clause will prevent that, because it is a sure bet that, once abatement of the measures in the Bill starts, it

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will be a slippery slope. I understand that the Minister believes that there are few or no loopholes through which abatement could be practised, but it is for him to demonstrate that that is so. I must put on record that the Opposition want a non-abatement clause to ensure that any protections for workers are enacted in full and to the benefit of all concerned.

Mr. Peter Lloyd : The hon. Member for Wolverhampton, North-East (Mr. Purchase) is seeking to ensure that no agreement or contract which an employer may persuade an employee to enter into can override or take away the rights provided to the employee by schedule 4 of the Bill.

I am sure that none of the rights can be removed or curtailed by any such device, and certainly not by the devices that he adumbrated. However, as I want to be sure that there is absolutely no way in which an employee can lose those rights, and as the new clause has only recently been printed on the amendment paper, I shall take legal advice to ensure that there are no such loopholes to close. If there are, I shall table an amendment or a new clause on Report. I do not believe that there are any loopholes, but I am certain that, if there were, the wording of the hon. Gentleman's new clause would not be sufficient to cover them.

The hon. Gentleman has my assurance that I shall look carefully into the matter. If he wants to come to see me at any time and tell me of any additional worries, I shall be very happy to meet him with my officials.

Mr. Purchase : The Minister is generous. Following what the Government have done this evening, we were due a little generosity--and we have received very little indeed. None the less, I thank the Minister for his undertaking. If he finds difficulties or loopholes, he may well come back with his own amendments. Such amendments would be welcomed by the Opposition. The essence of our case is that we want reasonable and proper protection for workers while they serve the rest of us on Sundays.

I beg to ask leave to withdraw the motion.

Motion and clause, by leave, withdrawn.

Bill reported, with amendments ; as amended, to be considered tomorrow, and to be printed.

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Statutory Sick Pay Bill (Allocation of Time)

10.21 pm

The Minister for Social Security and Disabled People (Mr. Nicholas Scott) : I beg to move

That the Order of the House [14th December] be supplemented as follows :

Lords Amendments 1. (1) The proceedings on Consideration of Lords Amendments to the Statutory Sick Pay Bill shall be completed at this day's sitting and, if not previously brought to a conclusion, shall be brought to a conclusion two hours after the commencement of the proceedings on this Order.

(2) For the purpose of bringing any proceedings to a conclusion in accordance with sub-paragraph (1) above--

(a) the Speaker shall first put forthwith any Question which has already been proposed from the Chair and not yet decided and, if that Question is for the amendment of a Lords Amendment, shall then put forthwith the Question on any further Amendment of the Lords Amendment moved by a Minister of the Crown and on any Motion made by a Minister of the Crown, That this House doth agree or disagree with the Lords in the Lords Amendment or, as the case may be, in the Lords Amendment as amended.

(b) the Speaker shall then designate such of the remaining Lords Amendments as appear to the Speaker to involve questions of Privilege and shall--

(i) put forthwith the Question on any Amendment moved by a Minister of the Crown to a Lords Amendment and then put forthwith the Question on any Motion made by a Minister of the Crown, That this House doth agree or disagree with the Lords in their Amendment or, as the case may be, in their Amendment as amended ;

(ii) put forthwith the Question on any Motion made by a Minister of the Crown, That this House doth disagree with the Lords in a Lords Amendment ;

(iii) put forthwith with respect to the Amendments designated by the Speaker which have not been disposed of the Question, That this House doth agree with the Lords in the Amendments ; and

(iv) put forthwith the Question, That this House doth agree with the Lords in all the remaining Lords Amendments ;

(c) as soon as the House has agreed or disagreed with the Lords in any of their Amendments the Speaker shall put forthwith a separate Question on any other Amendment moved by a Minister of the Crown relevant to the Lords Amendment.

Stages subsequent to first Consideration of Lords Amendments 2.--(1) The Speaker shall put forthwith the Question on any Motion made by a Minister of the Crown for the consideration forthwith of any further Message from the Lords on the Bill.

(2) The proceedings on any further Message from the Lords shall, if not previously brought to a conclusion, be brought to a conclusion one hour after the commencement of those proceedings.

(3) For the purpose of bringing those proceedings to a conclusion-- (

(a) the Speaker shall first put forthwith any Question which has already been proposed from the Chair and not yet decided, and shall then put forthwith the Question on any Motion made by a Minister of the Crown which is related to the Question already proposed from the Chair ;

(b) the Speaker shall then designate such of the remaining items in the Lords Message as appear to the Speaker to involve questions of Privilege and shall--

(i) put forthwith the Question on any Motion made by a Minister of the Crown on any item ;

(ii) in the case of each remaining item designated by the Speaker, put forthwith the Question, That this House doth agree with the Lords in their Proposal ; and

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(iii) put forthwith the Question, That this House doth agree with the Lords in all the remaining Lords Proposals.

Supplemental

3.--(1) The Speaker shall put forthwith the Question on any Motion made by a Minister of the Crown for the appointment and quorum of a Committee to draw up Reasons.

(2) Such a Committee shall report before the conclusion of the sitting at which it is appointed.

4.--(1) In this paragraph "The proceedings" means proceedings on Consideration of Lords Amendments or on any further Message from the Lords on the Bill, on the appointment and quorum of a Committee to draw up Reasons and the Report of such a Committee.

(2) Paragraph (1) of Standing Order No. 14 (Exempted business) shall apply to the proceedings.

(3) Proceedings under paragraph 1(2) or 2(3) above shall not be interrupted under any Standing Order relating to the sittings of the House.

(4) No dilatory Motion with respect to, or in the course of, the proceedings shall be made except by a Minister of the Crown, and the Question on any such Motion shall be put forthwith.

(5) If the proceedings are interrupted by a Motion for the Adjournment of the House under Standing Order No. 20 (Adjournment on specific and important matter that shall have urgent consideration) a period equal to the duration of the proceedings of the Motion shall be added to the period at the end of which the proceedings are to be brought to a conclusion.

(6) If the House is adjourned, or the sitting suspended, before the expiry of the period at the end of which the proceedings are to be brought to a conclusion, no notice shall be required of a Motion made at the next sitting by a Minister of the Crown for varying or supplementing the provisions of this Order.

The motion provides that further consideration of the Statutory Sick Pay Bill should be concluded no later than two hours from now, and specifies the order in which the amendments are to be considered.

This is not a long or complicated Bill, and the House has already had ample time to debate its main provisions. The House should bear in mind the fact that the Bill will take effect from 6 April this year. I believe that we owe it to industry and commerce to complete our consideration in good time to enable employers to introduce the changes as smoothly as possible.

Against that background, I commend the motion to the House. 10.22 pm

Mr. Keith Bradley (Manchester, Withington) : It is extraordinary that we should be starting our consideration of Lords amendments by yet again debating a guillotine motion. The debacle of the handling of this Bill continues. It started on 16 December, when the Government failed to secure, through all reasonable channels, a means of dealing with this Bill and with the Social Security

(Contributions) Bill.

I believe that the Government now rue the day they chose to steamroller this measure through the House. They have shown utter contempt for proper scrutiny, and have caused outrage not only among Opposition Members but among the public. The legislation will affect businesses large and small throughout the country.

Although it is barely eight weeks since the Government used their original guillotine motion, and despite their arrogance and contempt, we have no intention of delaying matters further. When the Government, with barely six hours of debate, rushed the original provisions through, we predicted that it would be examined in greater detail in another place, and that, in particular, the provisions as they affected small businesses would be gone into.

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Under the new legislation, the arrangement is to remove the opportunity for large businesses to reclaim a rebate on statutory sick pay and reduce the amount that small businesses can claim to 80 per cent., but not until after the first four weeks. We predicted that the Government would come under great pressure from small businesses, which the Labour party now represents so effectively. Clearly, we are now the champions of small businesses. We knew that, as a result of the pressure that we placed on the Government, as well as the opportunity for enlightened debate in the other House, amendments would be brought forward.

We pointed out clearly on Second Reading that the shift of the burden of some £750 million on to small businesses at a time when they were trying to recover from the Government's economic mismanagement was a burden against which they would rightly fight. Although the Government said that the 0.2 per cent. changes made to national insurance contributions would not lead to costs to small businesses, we had always questioned that, and will look carefully at the figures when the legislation comes in.

Mr. John Sykes (Scarborough) : Will the hon. Gentleman give way?

Mr. Bradley : No, time is short because of the guillotine motion. Mr. Sykes rose--

Mr. Deputy Speaker (Mr. Michael Morris) : Order. The hon. Gentleman is clearly not giving way.

Mr. Bradley : We have important points to make in this debate, and although I shall be happy to give way to the hon. Gentleman when we debate the amendments, which I am sure he is interested in and will wish to contribute to, I cannot give way at this stage.

We do not intend to delay the House at this stage, but we predicted that the Government would have to table an amendment at the Lords amendments stage to recognise the horror felt by small businesses at the provisions of the Bill. I shall delay the House no longer but simply put on record again the fact that the Government's shoddy contempt for the House has led us to this unfortunate position. That is why the Labour party will continue to harass the Government and effectively scrutinise this legislation at every turn throughout this Session of Parliament.

Question put and agreed to .

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Statutory Sick Pay Bill

Lords Amendments considered.

After Clause 2

Lords amendment : No. 1.

(" .--(1) In part XI of the Social Security Contributions and Benefits Act 1992 (statutory sick pay), after section 159 insert-- "Power to provide for recovery by employers of sums paid by way of statutory sick pay. 159A.--(1) The Secretary of State may by order provide for the recovery by employers, in accordance with the order, of the amount (if any) by which their payments of, or liability incurred for, statutory sick pay in any period exceeds the specified percentage of the amount of their liability for contributions payments in respect of the corresponding period.

(2) An order under subsection (1) above may include provision-- (

(a) as to the periods by reference to which the calculation referred to above is to be made,

(b) for amounts which would otherwise be recoverable but which do not exceed the specified minimum for recovery not to be recoverable, (

(c) for the rounding up or down of any fraction of a pound which would otherwise result from a calculation made in accordance with the order, and

(d) for any deduction from contributions payments made in accordance with the order to be disregarded for such purposes as may be specified,

and may repeal sections 158 and 159 above and make any amendments of other enactments which are consequential on the repeal of those sections.

(3) In this section--

"contributions payments" means payments which a person is required by or under any enactment to make in discharge of any liability of his as an employer in respect of primary or secondary Class 1 contributions ; and

"specified" means specified in or determined in accordance with an order under subsection (1).

(4) The Secretary of State may by regulations make such transitional and consequential provision, and such savings, as he considers necessary or expedient for or in connection with the coming into force of any order under subsection (1) above.".

(2) In section 176(1)(c) of the Social Security Contributions and Benefits Act 1992 (parliamentary control : orders subject to affirmative procedure), at the appropriate place insert "section 159A(1)".

(3) the Secretary of State--

(a) shall lay before each House of Parliament the draft of an order under section 159A(1) of the Social Security Contributions and Benefits Act 1992 (inserted by subsection (1) above) framed so as to come into force on or before 6th April 1995, and

(b) if the draft order is approved by a resolution of each House of Parliament, shall make the order in the form of the draft, unless before 1st December 1994 he lays before each House of Parliament a report explaining why he does not intend to make such an order.")

The Minister for Social Security and Disabled People (Mr. Nicholas Scott) : I beg to move, That this House doth agree with the Lords inthe said amendment.

Mr. Deputy Speaker : With this, it will be convenient to take also Lords amendments Nos. 2 to 4, the last of which involves privilege.

Mr. Scott : It is widely recognised that we are aware of the special needs of small employers faced with more lengthy absences due to sickness. That is why we have always intended to make generous improvements to the existing small employers' relief provisions by increasing the number of employers eligible to benefit from that

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concession. We shall also reduce the period after which full reimbursement becomes available, from the present six weeks to four weeks.

Those changes will be brought into effect from 6 April 1994 by means of affirmative regulations, a draft of which I propose to lay before Parliament tomorrow. Some 750,000 employers--almost two thirds of those eligible to pay statutory sick pay--will be eligible. The small employers' relief scheme will be of benefit to small firms when an employee goes sick for a long time. An alternative means of helping those employers has been proposed in another place. We have never been opposed in principle to a new reimbursement scheme. Our concerns have centred around the need to avoid possible abuse of the new scheme and the need to obtain the relevant statistical data from employers so as to set the reimbursement threshold at an appropriate level.

10.30 pm

The lack of time available to consult both sides of industry more widely on the details of the proposed scheme means that we are unable to move as fast as some Members of the other place would wish. We believe that more time is needed to consider the proposed scheme in more detail. The amendment accepted in another place acknowledges the strength of our concerns and is worded in such a way as to allow sufficient time for the collection of data on employers' monthly statutory sick pay and national insurance contributions. That information will be crucial in enabling us to set the new reimbursement threshold at a level that will cost no more than the planned costs of the proposed enhancements to the existing small employers' scheme.

The new clause allows the Secretary of State to provide by order for employers to recover that amount of their statutory sick pay payments that exceeds a specified percentage of their national insurance contributions liability in a given period. If, following consultation, the Government decide that they do not wish to proceed with the new scheme proposed in another place, the amendment also requires the Secretary of State to lay a report before Parliament explaining his decision. That is a wise way to consider the future of the provision. The new clause also provides for my right hon. Friend the Secretary of State to repeal the existing small employers' relief provisions at sections 158 and 159 of the Social Security Contributions and Benefits Act 1992. That would be a logical consequence of introducing a new SSP reimbursement scheme. It would be nonsensical to have both schemes running at the same time. The intention of the amendment is clearly to replace the existing system, not to augment it. The Government should accept the amendment, which I commend to the House.

Mr. Keith Bradley (Manchester, Withington) : It is rich for the Minister to move the amendment and claim that the Government always had the interests of small businesses in mind, and that it was only a matter of time before the amendment appeared. We should pay tribute to the other place for debating the subject so effectively and putting pressure on the Government to recognise the factor that we

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recognised on Second Reading--the great unhappiness among small businesses about the Bill's original provisions.

We only have to look yet again at the comments made by the small business organisations at the time to recognise that, even then, the Government were in trouble over the provision. The Institute of Directors stated that it was worried about the damaging effects on business of the new burdens created by the changes in the statutory sick pay provisions. Surprisingly, the Confederation of British Industry stated :

"It poses fundamental questions about who should bear the cost of social security provision."

I shall not expand on that subject tonight as I would be straining the terms of the amendment. A marker has been put down to show us that we should keep a wary eye on the Government, otherwise other potential social security and social insurance provisions may be passed on to small businesses. Maternity pay may be the next provision that businesses have to fund in future. In the past it has been funded through the social security system.

The Forum for Small Business--not an organisation that would normally defend the suggestions that we made at the time the problems arose--made the following statement :

"Current proposals if implemented are likely to become the principal cause of a significant number of insolvencies." On Second Reading, we flagged up the potential problems for small businesses when the £750 million statutory sick pay burden was shifted to industry. We are debating a major change, and the time for us to do so is being limited. Any amount of time was given to ensuring proper debate of an earlier measure that merely--I use the word "merely" for purposes of comparison--reduced a 100 per cent. clawback to 80 per cent. I shall not repeat all the arguments that expressed our outrage at the guillotining of this Bill ; we are all living with the consequences.

As the Minister said, the amendment was prompted by widespread anxiety-- first expressed by the Labour party in the House of Commons, but pursued more vigorously by the other place because of the extra time allowed there- -about the way in which small businesses would be affected by not being able to claw back rebate for sick pay in the first four weeks.

It was felt that--as the Opposition had made clear in this House--most illness leading to a requirement for sick pay occurred in those first four weeks ; indeed, research had shown as much. The Government were placing a particular burden on small businesses ; they were tackling the problem of long-term sickness, rather than considering the short-term sickness that potentially posed the biggest problem for small businesses. An epidemic, for instance, could cause enormous problems for the businesses that can least afford not only to pay sickness benefit to staff, but to provide replacement staff.

Having heard the arguments advanced in the other place, the Government considered them carefully. They had two main objections. First, as the Minister said, the shift of burden might be open to abuse by employers who, the Government believed, might move their statutory sick pay payments from one month to another so as to reach the set level over a period. We therefore welcome the new mechanism to avoid that problem.

The Government's second worry was that there would not be enough time to implement the scheme--the

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