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3.45 pm
I hope that it is clear that the Government are not seeking to place employers in the invidious position of having to delve into the personal living and family support arrangements of their employees. There must be some arrangement whereby the employer can be clear as to the course of action that he has to follow, without any risk of redress, or of finding that the Inland Revenue has refused to reimburse an amount that he has paid in good faith following an employee taking statutory paternity leave, on the ground that the employee did not satisfy the motive test now being removed from the new section.
I would be grateful if the Minister could deal with those questions. Then we can see how to proceed.
Alan Johnson: Apart from the royalties question, I did give due credit to the hon. Member for Runnymede and Weybridge. It was an exemplary Committee in the way in which various items were raised. It was scrutiny at its best—[Interruption.] "Hear, hear" say members of that Committee.
The hon. Gentleman raised the point about the motive test. As he mentioned, amendment No. 21 seeks to ensure that pay, like leave, should be available only where the employee has taken time off work for the purpose of supporting the mother or caring for the child, which would otherwise have been lost from the drafting. That provision is reinstated in the new section relating to the rate and period of pay. It would be unusual for someone to seek to take two weeks off work and not seek to be paid for those two weeks. We have looked at this very carefully and we are confident that the change does not lose the important point that we were trying to preserve: there has to be a genuine motive for taking the leave.
On the issue of self-certification, we do not believe that this is different from any other form of leave. Employers should not be asked to delve into the private concerns of their employees; it was an important principle that we established. Would someone claim for two weeks paternity leave and take that two weeks in Las Vegas? That it is unlikely. Even when we have finished applying the biggest increase in maternity leave, which is mirrored in paternity leave and maternity pay, since 1948, paternity leave will still be up to the grand total of £100 a week.
It is unlikely that someone would seek to use paternity leave to holiday in Nevada. Nevertheless, if they do try to do that, it will be a matter for the employer to deal with in the normal way—as a disciplinary matter. People who seek to take other forms of leave when they are misleading the employer are in the same position.
Mr. Hammond: The Minister says that it would be a matter for the employer to deal with as a disciplinary issue, but to the extent that the employer is being reimbursed by the Inland Revenue, it strikes me that it is more a question of fraud against the Revenue than a matter of direct economic concern to the employer. Is the Minister saying that it will be left entirely to the employer to police the provision and to take any necessary action?
Alan Johnson: No, I am not. I am saying that, in terms of the checks that are carried out, if an employer obtains evidence of an employee taking leave in a way that is not covered by the Bill, it would be a disciplinary matter for the employer to deal with. The Inland Revenue, on the other hand, would use the cruel and unusual punishments that are open to it to pursue an individual along those lines. I am not saying what the hon. Gentleman suggested at all.
Mr. Mark Prisk (Hertford and Stortford): There will clearly be a transfer of money in terms of payments. Has the Minister made a regulatory impact assessment of the administrative costs to businesses—particularly small businesses—of the changes?
Alan Johnson: The hon. Gentleman returns to a theme that we know well from Committee. I remind him that the response from small businesses was overwhelmingly positive in respect of adoption leave, to which the provisions also apply, because an adoptive parent can take two weeks paternity leave. In fact, their biggest single comment was that this should have happened a long time ago. On paternity leave, there was complete acceptance that it was right that fathers should have time to spend with their new-born babies. The basic point that businesses made was that they should not be expected to pay paternity leave. They also made the point that the Government should expand the number of small businesses that would be able to claim back 105 per cent. of maternity and paternity pay—the two rules are mirrored. We have taken into account the views of small businesses in all those respects.
Mr. Prisk: My question was on administrative costs, not on the pay itself. I understand what the Minister has said on that point, and I share those motivations, but I am seeking an answer on the costs and administrative burdens now being put before the House that have come from the other place.
Alan Johnson: On the amendments carried in the Lords, we are doing precisely what the hon. Member for Runnymede and Weybridge asked us to do, which is to make it absolutely clear that when individuals take such leave, the only responsibility that the employer will have will be for existing employees. There was some ambiguity in the previous wording, but small businesses will welcome the changes.
Mr. Hammond: The Minister has just referred to employers being able to recover 105 per cent. of the amounts paid to employees. For the avoidance of any ambiguity, will he confirm for the record that that is 105 per cent. of the amount paid, to include the employer's national insurance contribution, so that it will, in fact, be less than 100 per cent. of the cost to the employer that is being recovered?
Alan Johnson: Yes, I confirm that. It will work out at about 104 per cent. when the complex statistics are taken into account.
I thank the hon. Member for Runnymede and Weybridge for recognising that we have sought carefully to take his views into account and incorporate them into the amendments. He should be reassured by the fact that our moving the provision on motivation from amendment No. 21 to another part of the Bill still secures the basis of that motivation.
Mr. Hammond: As the Minister is obviously about to finish, may I ask him specifically to give an assurance that an employer acting in good faith making a payment of statutory paternity pay will not find himself unable to get reimbursement because the Revenue has determined that the employee does not satisfy the motive test now being inserted into new section 171ZE?
Alan Johnson: If the hon. Gentleman will forgive me, I will not give him an answer now; I will look into the matter to make sure that that is the case, and I will write to him.
Lords amendment agreed to. [Special Entry.]
Lords amendments Nos. 2 to 24 agreed to. [Some with Special Entry.]
Clause 16
Interpretation
Alan Johnson: I beg to move that this House agrees with the Lords in the said amendment.
Mr. Speaker: With this we may take Lords amendments Nos. 38 to 45, 61, 76, 77, 79 and 81 to 87.
Alan Johnson: The amendments, although not related, are all technical, which is why they have been grouped together.
Lords amendment No. 25 corrects an oversight on our part by including the equivalent of the Department of Trade and Industry in Northern Ireland, the Department for Employment and Learning, in the data-sharing provisions. The Department for Employment and Learning, like the DTI, may need access to high-level statistical information to assess how the schemes are working. The term "the Department" is defined in clause 16; our amendment simply includes the Department for Employment and Learning, as well as the Department for Social Development, in the data-sharing provisions.
Although many of the Bill's provisions do not extend to Northern Ireland, we expect that Northern Ireland will make its own provisions for paternity and adoption leave and pay. We also expect that the Inland Revenue will be responsible for the operation of those schemes, as it will be in Great Britain. Because the Inland Revenue's responsibilities are UK-wide, however, we have to legislate in a Westminster Bill to enable it to take on these responsibilities. Clause 16 is one of the provisions that must therefore extend to Northern Ireland.
The Department for Social Development in Northern Ireland has responsibilities equivalent to those of the Department for Work and Pensions in Great Britain, and the Department for Employment and Learning in Northern Ireland is the equivalent of the DTI in Great Britain. The same good reasons why the Inland Revenue and Departments in Great Britain may well need to exchange information on statutory paternity and adoption pay apply equally to the Inland Revenue and Departments in Northern Ireland. The amendment ensures that Departments in Northern Ireland will be able to take a joined-up approach to statutory paternity and adoption pay, in the same way as Departments in Great Britain.
Lords amendment No. 38 is a technical amendment that reverses the order of clauses 32 and 33. Clause 33 deals with the presentation of complaints to tribunals. It makes sense for it to precede clause 32, which is about consequential changes to time limits for making complaints to tribunals. Clause 32 also refers consequentially to schedule 4, but it is clause 33 that introduces that schedule.
Lords amendments Nos. 39 to 45 are minor technical amendments to clause 37, which allows employers to use a letter of engagement or a contract of employment to satisfy the requirement to provide employees with a written statement of employment particulars. As a written
statement must give a date by reference to which it operates, an alternative document intended to fulfil the same function must also give such a date. However, the original text of clause 37 refers only to
- "the date of the document".
Lords amendments Nos. 39 to 44, taken together, clarify the position. They provide that when an alternative document is intended to fulfil the written statement requirements, the date by reference to which it operates for that purpose is the date on which it is given to the employee. New section 7B(2) of the Employment Rights Act 1996 serves no useful purpose once the date of the alternative document has been clarified by Lords amendments Nos. 39 to 44, and it is therefore removed by Lords amendment No. 45.
Lords amendment No. 61 provides that clauses 45 and 46, relating to fixed-term work, will come into force as soon as the Bill receives Royal Assent, thus allowing the fixed-term regulations to be laid immediately. That will give employers and employees more time to prepare for their coming into force, which should ensure compliance with the regulations. Lords amendments Nos. 76 and 81 to 84 are technical amendments to schedule 7. They simply ensure that the appropriate minor and consequential amendments concerning statutory paternity and adoption pay are made to the Social Security Administration Act 1992 and the Employment Rights Act 1996.
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