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Mr. Lloyd: Does my hon. Friend agree that one way round the problem of the Polkey case would be to raise the minimum standard of the disciplinary structures to the level of the ACAS code?
Rob Marris: I agree that that would take us forward, but we would need to amend clause 34(2), which inserts new section 98A(2), which states that
- "an employee who is dismissed shall not be regarded for the purposes of this Part as unfairly dismissed because of failure by the employer to follow a procedure in relation to the dismissal if the employer shows that he would have decided to dismiss the employee if he had followed the procedure."
The summary of the regulatory impact assessment at the back of the explanatory notes states at paragraph 154 that employees will lose between £4 million and £6 million from the change. That is my interpretation of that paragraph. The median award for compensation in unfair dismissal cases in 2000-01 was £2,744. On that basis, the £6 million figure for losses to employees would mean that 2,200 employees were losing out. The £4 million figure produces a total of "only"—I put that word in quotation marks—about 1,450 employees. Thus, if I am reading paragraph 154 correctly, an awful lot of employees will still be losing out. I hope that my hon. Friend the Minister can help on that point.
Unless I am misreading the Bill, it is a little unbalanced. Of course, it is always difficult to consider Bills, as one may misread them and Ministers will be much better read on them than me. None the less, clause 33 ensures that the Secretary of State can make regulations effectively precluding the making of a claim to an employment tribunal unless the employee has complied and done their bit on the schedule 2 procedures, which include statutory disciplinary procedures and so on. If I am reading the clause rightly, it therefore locks out the employee—the applicant who initiates the employment tribunal proceedings—but not the employer.
Notwithstanding what Opposition Members say—one of them suggested that the Bill was tilting towards employees—that provision seems to tilt towards the employer. Through the pre-hearing process and so on, and depending on the regulations made by the Secretary of State, the employee can effectively be locked out and prevented from going to an employment tribunal at all. As it is employees who initiate employment tribunal applications, employers cannot be locked or freezed out in the same way, as they are the respondents.
In conclusion, I find the provision on costs a little worrying, although I shall not comment on it in great depth. I think that a proportion of 242 out of 240,000 was mentioned in relation to costs orders. The order on vexatious litigant costs is very rarely used, although I obtained one against a respondent company in the employment appeal tribunal; indeed, I was very pleased, as the appeal was a vexatious one. None the less, the provision is very rarely used. It has a deterrent effect on both applicants and respondents, which is fine. One never knows how many people have been deterred and have not made the application, so in one sense the raw figures that have been given do not tell us a great deal.
I would like the Government to address the question of preparation time. The tribunal can make an award in that regard, although it is unclear how it will do so. The Bill seems to be ambiguous as to whether the calculation will be made on the back of an envelope or whether there will be assessment-of-costs proceedings. None the less, the tribunal can in certain circumstances make an award against an applicant or respondent requiring them to pay the other side for its preparation time. The provision could include not only the preparation time of professional representatives, who would fall under the usual costs elements that have traditionally applied, albeit in a small number of cases, but, say, the time spent by a managing director in putting together the papers to fight what turned out to be a losing application.
I hope that my hon. Friend the Minister can enlighten me on that point, especially as I am not aware of any other part of our legal process in which such a procedure is allowed. For the past 13 years, the bulk of my work has been in civil litigation, but it has also involved some criminal and tribunal work, and I have never come across awards for preparation time. As a solicitor, when I succeeded—I have to tell the House that I mostly did so, as one picks good cases and hopes to give good advice—my clients would recover my legal bill, but no form of recompense for the time that they spent on the case as clients.
In a personal injury case, for example, much time could be spent by a client who has to go from their home in Wolverhampton in my constituency to Birmingham to see a specialist doctor, for an MRI scan or whatever, but they
would not recover their time for going to Birmingham for a medical appointment in a personal injury case. When I failed to win in a case in which an employer was being sued, the employer's managing director did not add to the bill their time by including it in what used to be called taxation, but is now called assessment of costs. They added on their solicitors' time, yes, but not their own.This seems a very curious provision and I am very uneasy about it, especially as it could, I believe, involve up to £10,000. That may not be a lot of money to a large business, but it would be an awful lot to a small business or an applicant. I hope that the Government will explain that point, as I am very uneasy about this novel concept of recovering costs for preparation time.
Mr. Hammond: Ever trying to be helpful, I think I am not mistaken in saying that the arrangements for recovering costs following planning appeals include the possibility of recovering preparation time. The hon. Gentleman might like to check out that point.
Rob Marris: I am grateful to the hon. Gentleman. I shall very happily check that point and I hope that I will do so with the assistance of the Minister.
I was slightly taken aback when the hon. Gentleman intervened, as I was about to sit down anyway, having finished my remarks.
8.26 pm
Hywel Williams (Caernarfon): Thank you, Mr. Deputy Speaker, for giving me the opportunity to speak in the debate.
Other hon. Members have welcomed the Bill and we in Plaid Cymru also welcome parts of it. I am sure that the hon. Member for Manchester, Central (Mr. Lloyd), who is leaving his seat, will be pleased to hear that. However, we also have some reservations. We welcome the proposals regarding parental leave, adoption leave, maternity pay and the equal pay questionnaire, among others, but we have reservations about the work-focused interviews for working-age partners of benefits claimants. We agree with the National Association of Citizens Advice Bureaux when it says that these plans could put vulnerable couples, including disabled people and partners who care for them, under pressure. We are also concerned that the inadequate minimum procedural standards for internal dispute resolution may become the only standards for employers, and we think that the proposal for costs awards might become disincentives. Those are, very briefly, some of the points that we want to make.
However much we welcome the Bill, our welcome is qualified because of its failure to address the deficiencies of the Employment Relations Act 1999, specifically in section 16 and schedule 5. The Government have an opportunity to remedy an injustice and they have been pressed to do so, but they have failed to take advantage of that opportunity in the current Bill. The 1999 Act introduced additional protection against dismissal for workers engaged in lawful industrial action. Under the Act, it is unfair to dismiss employees taking protected action—that is, lawful, official action—unless it lasts for more than eight weeks and unless the employer has taken such procedural steps as are reasonable to resolve that dispute. After eight weeks, the protection lapses. In our view, that undermines the ability of workers with a just
cause, who act reasonably and within the law, to oppose an unreasonable employer. Such an employer, who is determined to exploit the law for his purposes, can hang on for eight weeks and then sack striking workers.I want to illustrate my point with the Friction Dynamex dispute, which has already been mentioned, and has continued in my constituency for more than 30 weeks. The Friction Dynamex workers were the first to be sacked following the introduction of the eight-week period. Some hon. Members attended a lobby by the sacked workers and their supporters last Thursday, and heard their powerful, direct testimony, as well as speeches by Mr. Bill Morris of the Transport and General Workers Union, among others.
The sacked workers are experienced and skilled long-term employees; many have 20 or 30 years' service. They have shown their commitment to the firm under several owners. For example, in the past five years, they agreed not to take a pay rise because of market conditions in their industry. They do not take strike action lightly.
The current owner took over in 1997. He tried to impose a four-day week without overtime, attendance at meetings without pay, the removal of bargaining agreements and a no-strike agreement. After many fruitless attempts to negotiate with the employer, the union held a strike ballot. The workers went on strike entirely legally, and initially for only one week. I accompanied them on the morning that they returned to work. As they walked back, the employer personally went up to the gates and locked them out. That is the measure of that employer.
The strike has continued for many months and the workers have conducted themselves with dignity and discipline. The union has tried to negotiate with the employer using the good offices of third parties, including the Advisory, Conciliation and Arbitration Service, and begun negotiations several times, only for the employer to pull back. Its efforts have been to no avail. In the meantime, the employer has recruited other workers from the unemployment register and continued his business.
The workers have maintained a 24-hour picket and have the overwhelming support of the local community. In July, we held a march and a rally in Caernarfon. It attracted massive and unanimous local support and was one of most affecting experiences that many of us who took part have ever had. The community was united in support of its workers. For many of us, it called to mind the longest strike in the industrial history of our country: streic fawr y Penrhyn—the great strike at the Penrhyn slate quarry which lasted for three years, against a robber baron quarry owner, a nobleman who used every foul trick to break the workers' resolve and the community's spirit. The comparison with the current dispute is apt.
What recourse remains to the Friction Dynamex workers after 30 weeks of determined action? They are taking their case to an industrial tribunal. However, they do not want a tribunal hearing but to work in fair and just conditions. In a well timed intervention, the hon. Member for Conwy (Mrs. Williams) called for a review to help them. However, a review will not help because they have been on strike for 30 weeks.
At the lobby last week, Mr. Bill Morris told us that he had not expected a Labour Government to enact anti-trade union law. The Friction Dynamex dispute shows the
woeful inadequacy of the 1999 Act to protect workers who are engaged in a lawful dispute. The shortcomings of the labour law means that bad employers, not the workers, are protected. Protection against unfair dismissal must be extended. If it is justified for eight weeks, it is also justified thereafter.The Bill might have been an opportunity to amend the 1999 Act and end the unjust eight-week rule. It unfortunately fails to do that.
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