Employment Bill

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Mr. Hammond: Perhaps the hon. Gentleman will forgive my ignorance as a non-specialist, but it is not immediately apparent to me why investigation would be inappropriate in cases of redundancy but appropriate in every other case. Presumably, on the hon. Gentleman's logic, it would be necessary to establish that the redundancy was genuine.

Norman Lamb: What we are driving at is that in any dismissals that involve the conduct of an employee, whether it is the extent of their sickness absence, poor performance or misconduct, the employee's actions need to be investigated. That is already a principle of law, and it should be enshrined in the Bill.

3.30 pm

With regard to redundancy, the employee's conduct is not an issue. It is more a question of looking to see whether the business has a reduced need for employees. Therefore, the concept of investigation is not appropriate in cases of redundancy, although it is appropriate in other circumstances.

Mr. Lloyd: I support the inquiring nature of the comments made by the hon. Member for North Norfolk (Norman Lamb). He raises an important issue, which I suspect has not been thought through by many hon. Members. Although this aspect of the provisions was probably regarded as applying mainly to disciplinary procedures, it can apply to redundancy. It is important that the procedures relating to redundancy, like those relating to all other forms of action, are fair, although redundancy contains no disciplinary element. Therefore, I hope that the Minister will respond to the hon. Gentleman's comments.

I want to concentrate on the need properly to investigate. The wording of the amendment is clumsy, which the hon. Gentleman conceded. I appreciate that some of us have our doubts about whether the ACAS code is all that it should be, but its wording is helpful. It states:

    ''The employer must establish the facts promptly.''

Opposition Members raised the issue of the one-employee business. In the case of sexual harassment, where the employer harasses the employee, it is beyond doubt that the grievance procedure would apply. However, if the employee harasses the employer, disciplinary procedures would apply. It would not be an unreasonable defence for the employer to say that, as the victim of harassment, he or she was aware of the facts. That would be a copper-bottomed defence before a tribunal.

Employers must know that they have a responsibility properly to establish the facts. It would be astonishing if an employer were entitled to take disciplinary action without knowing the facts. That relates to the Minister's statement in a previous debate that, although the requirement to investigate is not included in schedule 2, tribunals would most certainly consider whether the employer had properly investigated. That is a paraphrase, but I am sure that the Minister will tell me if I am grossly misquoting him. However, if that is the case, there is genuine merit in employers knowing that there is such a requirement.

I accept that we should not overload small businesses or give them any unthought-through surprises in the legislation. Frankly, I think that most reasonable employers would assume that they had a responsibility to establish the facts before acting. That is simply common sense, and I hope that we can all agree on that.

Mr. Hammond: The hon. Gentleman uses the term ''establish the facts'' rather than ''investigate fully''. I am far more tempted by the idea that any reasonable person would want to establish the facts before they committed anything to writing.

I want to probe the hon. Gentleman on the matter, because he may have some knowledge of it. There is nothing obvious to suggest that the piece of writing in which the employer described the employee's misconduct would be privileged. Therefore, the employer would be prudent to establish the facts, because he might be sued for libel if he accused the employee in writing of doing something that he had not done.

Mr. Lloyd: As ever, I seek to be well briefed. I think that I heard the word ''privilege''.

Rob Marris: Perhaps I can describe a hypothetical scenario. If I were on a one on one with the hon. Member for Runnymede and Weybridge—just the two of us were in the room—and I told him that he was the biggest thief that I had ever come across, he could not sue for defamation because the situation would be one on one. I would not be lowering the esteem in which he was held in the minds of right-thinking people. Therefore, a letter from an employer to an employee that said that his conduct was dishonest could not give rise to defamation.

Mr. Lloyd: Of course, the intervention was directed to me, although the allegation of lying was directed at Opposition Members.

Norman Lamb: I can add to the explanation just given. When something is written down as part of a disciplinary procedure, qualified privilege applies. That means that unless it has been written down from malice, no claim can be made against the employer who has written it down. Therefore, there is no great threat to an employer who writes something that turns out not to be true.

In addition, few employees have the wherewithal or financial clout to pursue defamation actions, which tend to cost tens of thousands of pounds. There is simply no sufficient control on the employer to prevent him from writing down things that turn out not to be true.

The Chairman: Order. Before the hon. Gentleman responds, I remind the Committee that, although we can debate broadly in Committee, if hon. Members intervene they must direct their remarks to the hon. Member who has the Floor. If that is not done, I will be disciplined by the Speaker.

Mr. Lloyd: That was a dynamic demonstration of the flexibility of our procedures. The hon. Member for Runnymede and Weybridge posed a question and my two legal advisers took it up on my behalf. The words were mine, but they came from other mouths. However, we can make some progress if we examine the intention here. The hon. Gentleman said that he was more tempted by one interpretation than the other—I do not know how tempted he is. Perhaps he will tell us.

We have established the simple point that any reasonable person would assume that an employer or employee would take steps to establish the facts if it were necessary, or would at any rate be privy to the facts. In terms of the hypothetical and real cases that we have discussed when the employer was the victim, one would assume that he would be well aware of the facts. The alternative would be that the employer could act without knowing the facts, which would be unreasonable, and, one hopes, would be judged unreasonable by the tribunal.

If it is obvious that if the situation is universal and all employers find themselves bound in the same way, we are no longer discussing an area about which a tribunal may come to a judgment. If that is the case, in fairness to all parties, there would be genuine merit in having the duty on employers in the schedule. That would not merely be a device—there would be genuine merit in the amendment. After all, it is an easy and a common-sense duty, but having it there would remind them that if they failed to subscribe to it, they would find themselves judged by the tribunal, which would find against them. I urge my hon. Friend the Minister to consider not the form of words—it is defective in that ''establishment of facts'' is better than the wording of the amendment—but the spirit of the amendment, which should command support across the Committee.

Alan Johnson: Our debates have become much more exciting under your chairmanship, Mr. Conway. We have had a debate full of sex and violence. My pulse is racing and I shall try to calm down. All amendments are well meaning. Some, as George Orwell might have said, are more well meaning than others. Amendment No. 29 is particularly well meaning. Our common aim is to ensure that schedule 2 is clear and unambiguous, and the hon. Member for North Norfolk thinks that paragraph 1 of the schedule gives scope for confusion. The paragraph refers to the written communication that the employer must send the employee under the standard statutory dismissal and disciplinary procedure. That communication is described as a statement in paragraph 1(2) but that term is not used in paragraph 1(1), where the employer is required to set out the issue in writing. The amendment therefore seeks to introduce a further link between the two sub-paragraphs, so it is well meaning.

I do not agree that a problem exists; the statement mentioned in paragraph 1(2) can have only one meaning in the context. No one could infer that two documents would be involved. The wording is clear. It will not cause any confusion to employers, employees or tribunals. It is unnecessary to include the additional wording. I hope that the hon. Gentleman will accept that and will withdraw his amendment.

The excitement concerned amendment No. 30, which also deals with schedule 2. That sets out the statutory dispute resolution procedure. Once again, I stress that we are talking about minimums. We know that the ACAS code also assigns a role to investigation and most existing procedures are more detailed than the proposed statutory minimums. The amendment seeks to introduce a compulsory investigatory stage into the standard dismissal and disciplinary procedure. I understand the points made by the hon. Member for North Norfolk and by my hon. Friend the Member for Manchester, Central.

3.43 pm

Sitting suspended for a Division in the House.

4 pm

On resuming—

Alan Johnson: I can understand why the amendment has been tabled. Investigations, the discovery of facts and the taking of evidence are all important and we do not argue with that. However, I am not convinced that they have a place in the statutory procedure and I will explain why.

The standard procedure currently requires the employer to set out the problem in writing, then there is a requirement to meet and discuss the issue, after which the employer must inform the employee of his decision. The next step involves an appeal, after which the employer must reach his final decision and inform the employee accordingly. Those are clearly defined actions given that they are statutory minimum procedures that will affect how far the employment tribunal system can be entered into. They will also determine whether a case is automatically unfair. Later, we will explain that procedures have to be met or dismissal will automatically be unfair.

If those steps have been taken and applied to individual cases, that should be relatively easy to verify. That is integral to the operation of clauses 31 to 34. We want to avoid having the tribunal system bogged down by the consideration of endless complex disputes about the application of statutory procedures. We want clarity for employers and for employees. Wherever possible, we have avoided introducing general and unspecific statutory obligations and the amendment would frustrate that aim.

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