Informing and Consulting Employees

[back to previous text]

Mr. Darvill: My question is about the culture in this country. If we take a timid approach to the matter, there may be initial short-term benefits in some areas. However, in the longer term, our nation would lose out on the benefits of greater employee consultation. Should we impose a minimum standard of consultation that is higher than the current minimum standard?

Mr. Johnson: I was almost in full agreement with my hon. Friend until his last comment. I wish to make it absolutely plain that we support information and consultation. We oppose the means rather than the end in this matter. We believe that there is a positive case to support the exchange of information and consultation, and for workers to be genuinely consulted at a time when the consultation means something, such as when they are in a position to suggest alternative proposals. That would benefit both business and competitiveness. Mechanisms, structures and minimum standards will not produce such a climate. As we have found before, they produce mechanisms and structures. The Government support information and consultation, but oppose the directive.

Miss McIntosh: May I draw the Minister's attention to the working note of the Council of Europe from the general secretariat of the Council to the social questions working party, and particularly article 5?

I entirely support the Government's position of resisting the imposition of the directive on our country. However, should the Minister not be able to do that, it would be incumbent on the Government to provide for the protection of confidentiality, particularly damaging confidential information that could be released by employees to third parties. Has the Minister considered the sanctions and penalties that could be imposed if there was a breach of such a confidentiality undertaking by employees?

Mr. Johnson: As I said in my opening statement—I do not think that the hon. Lady was present—the sanctions part of the directive is of concern even to those countries that generally support the directive. We are not party to the discussions on detail, because we oppose the directive in principle, but many countries have concerns about that aspect. It was flagged up at a meeting last year—I believe that it was in November—and is the most sensitive part of the directive for many of the countries that support the general framework of information and consultation.

Mr. Darvill: Are there any aspects of the proposal that the Government do not oppose?

Mr. Johnson: Yes, the principle of information and consultation.

Miss McIntosh: Are member states concerned that employees might inadvertently or even wilfully pass confidential material to a third party, in the spirit of openness under the proposed directive? Or are member states worried about the sanctions if such confidentiality is breached? Surely, there must be some provision to ensure that confidential information remains confidential.

Mr. Johnson: I agree, but the sanctions are about breaches by workers, not companies. Concern was expressed about that in the European Council.

We have not discussed details. Our involvement in such discussions would have sent a false message to the rest of the European Union. Like other countries, we think that it is an issue of principle. We have not discussed the detailed points, including the sanctions, in the same detail as some of the other member states of Europe have.

Mr. Gibb: Does the Minister think that we should have a contingency plan in case he loses the support of Germany and Denmark? Should he not have scrutinised the proposals in more detail and done his best to secure the best outcome for Britain? Would not that be a better approach?

Mr. Johnson: No, I do not agree. That is a dangerous game to play when negotiating, and I have been involved in many negotiations in my time. We are in a happy position where the Opposition completely agree with the Government. I am sure that that will be the case with many other issues as we approach the general election. The hon. Gentleman and his colleagues would be the first to criticise us if a report from Brussels said that civil servants or Ministers were negotiating at such a detailed level. The confidentiality provisions suggested are similar to those in article 5 of the European works councils directive, so there is a sanctions precedent.

Mr. Ivan Henderson: In the event that the Government do not adopt the directive, how could we ensure that companies in this country consulted their employees on the major issues that affect their work, conditions and future employment?

Mr. Johnson: There are two ways. First, the partnership fund, which is encouraging a change in culture, should not be minimised in any way. That programme is an extraordinary success, and we can take it forward into a second term, subject to the electorate.

Secondly, regulations already cover redundancies and health and safety. My hon. Friend the Member for South Thanet (Dr. Ladyman) referred to the Companies Act 1985. An existing tranche of legislation insists on consultation in various circumstances.

So we have a combination of culture change and the review announced by my right hon. Friend the Secretary of State on 18 January. We intend to analyse the argument that it is easier to dismiss workers in the UK than anywhere else in Europe. I am not sure that that is true. We also intend to look at whether the European works councils directive, which is relevant to many of the high-profile cases that we have had, is operating properly. Those strands will enable us to take the matter forward domestically.

Miss McIntosh: The Minister said that we have not yet come to the negotiation of detail and I have a more general question. We have a Swedish presidency and the European Scrutiny Committee recently spent two full days meeting Ministers who are responsible for social policy, among other matters. The Swedish presidency has an ambitious programme and will be followed by the Belgian presidency which, at a conference in Brussels on 13 February, set out its agenda on issues such as social exclusion and retirement schemes. How confident is the Minister that he will be able to resist this proposal and other, more ambitious proposals under the Swedish presidency and the Belgian presidency?

Mr. Johnson: As I have said, there was no qualified majority on this proposal and nothing has changed since November.

All European states signed up to the Lisbon recommendations to make Europe the best place for a knowledge-driven economy. If we consider every proposal and measure in terms of how many jobs it will create--we are committed to reducing unemployment dramatically in the European Union in the next 10 years--and introduce benchmarking, best practice and so on instead of regulation, we should arrive at a position where the measures that the hon. Lady suggested would not impose too great a threat. There is a place for regulation, but it must be in the context of better ways of progressing with the issues.

A new social agenda was agreed under the French presidency and we signed up to that. The Minister for Employment, Welfare to Work and Equal Opportunities, my right hon. Friend the Member for Dulwich and West Norwood (Ms Jowell), and I had an input to that, which shows the difference between engaging with Europe and putting our arguments, and sitting on the sidelines. That new social agenda commits the Swedish and Belgian presidencies and the following presidency to an agenda of benchmarking and best practice and not particularly regulation. There is a place for regulation, but, too often, we have used regulation when better methods were available to achieve the desired result.

The Chairman: If there are no more questions, I call the Minister to move the motion.

Motion made, and Question proposed,

    That the Committee takes note of the unnumbered Explanatory Memorandum from the Department of Trade and Industry dated 21st November 2000 relating to a draft Directive of the European Parliament and of the Council establishing a general framework for informing and consulting employees in the European Community; and supports the Government's position that it is not persuaded of the need for a directive on information and consultation in undertakings operating only at national level, which is difficult to reconcile with subsidiarity and would cut across existing practices in member states to no benefit.—[Mr. Johnson.]

11.8 am

Mr. Gibb: Here we are in the Committee in the unusual position of discussing an issue on which the Government and the Opposition agree, although I cannot speak for Labour Back Benchers. The motion states that the Committee takes note of various documents and the Opposition are happy to do that. It then states that the Committee

    ``supports the Government's position that it is not persuaded of the need for a directive on information and consultation in undertakings operating only at national level, which is difficult to reconcile with subsidiarity and would cut across existing practices in member states to no benefit.''

The Opposition fully and wholeheartedly support the motion, but we are not persuaded of the need for the directive, so we can support the motion with our conscience intact.

Such a set of laws would be unhelpful and over-prescriptive. The Government stated in paragraph 11 of the regulatory impact assessment on the directive that

    ``employee involvement can take many forms and should reflect the circumstances and requirements of individual organisations . . . A single framework across Europe cannot accommodate the great diversity of industrial relations practices''.

That is absolutely right. Conservative Members support progressive employers who keep their employees informed because that is the best way to run a business and it has beneficial effects. However, whether one needs laws prescribed from Europe or Whitehall to force it on employers and organisations is another matter. Such matters are better dealt with by voluntary agreements between employers and employees.

The cost to business of implementing such a directive would be staggering, as my hon. Friend the Member for Vale of York (Miss McIntosh) intimated. According to the Government's figures, it would involve recurring annual costs of between £209 million and £261 million and one-off set-up costs of between £84 million and £88 million.

Previous Contents Continue

House of Commons home page Parliament home page House of Lords home page search page enquiries ordering index

©Parliamentary copyright 2001
Prepared 28 February 2001