Norman Lamb: I accept that there is a case for keeping things simple, but does the Minister acknowledge that without a requirement for investigation, there are bound to be endless cases in tribunals where no investigation has taken place and the employers will argue that that had made no difference. They will say that they would have dismissed the employee anyway, and that might make the outcome a case of fair dismissal. It will be difficult for tribunals to reach a proper view on whether the additional procedural requirement, which is not set out in the standard procedure, would have made a difference. Many cases will therefore end up with the finding of fair dismissal without an investigation having taken place because the employer has managed to persuade the tribunal that an investigation would not have made a difference.
Alan Johnson: I do not accept that. We are talking about the statutory minimum and about what is necessary, not about what might be sufficient when the case comes before the tribunal. We have avoided introducing general unspecific obligations, and the amendment makes unclear the precise actions that employers would need to undertake fully to investigate a case. How should evidence be assembled and does investigation always require the taking of witness statements? Should fellow employees, as well as line managers be interviewed? Should a third party—say, customers—be involved? Should the accused individual be interviewed, and if he is, how would that square with the step 2 meeting?
I accept that the hon. Member for North Norfolk said that the amendment is not perfect, but it still implies that investigations should be full and that suggests that they would occur solely at the start of the process and before the employer writes to the employee. In practice, that would be undesirable. Often further investigations are required later in the process as other issues are raised by the employee in his or her defence. I am sure that the hon. Gentleman would not want to limit investigations in that way, but that would be the effect of the amendment. That illustrates how difficult it is to draft a clear, yet flexible set of investigative duties for the employer.
Of course, we do not want to discourage parties from fully investigating complaints or to dissuade employers from using more elaborate and customised procedures. We expect many parties, especially but not exclusively large organisations, to go beyond the minimum. That will be largely a matter for them to determine, drawing on the ACAS code.
I am afraid that I cannot accept the amendment. The schedule should be seen as establishing the core elements of procedures that should be applicable in a wide range of circumstances. We do not object to investigations or to fact-finding in themselves, but to the inadvisability of explicitly placing them within the statutory procedure. I hope that in the light of that explanation the hon. Gentleman will feel able to withdraw the amendment.
Rob Marris: I want to explore further what the Minister said in response to the hon. Member for North Norfolk. I am concerned that an employer who does not investigate and ends up before a tribunal could say, ''Well, I complied with the schedule 2 statutory minimum, so I didn't have to investigate. If Parliament had intended that an investigation should take place, it should be stated in the schedule.'' The applicant may then say, ''Ah, but you should have investigated under the ACAS code,'' because, as the Minister said, if the investigation is not carried out under schedule 2 the matter will be considered by the employment tribunal. The employer could respond, ''But under clause 34 it would have made no difference anyway, so I am off the hook on that one as well.''
I urge the Minister to reconsider investigation. When one tries to establish a simple and straightforward procedure in an Act, there is a danger of making it too simple, leaving oneself open to the attack at an industrial tribunal that, ''If Parliament had intended that, it would have stated it.''
Mr. Hammond: I am interested that the hon. Gentleman has adopted the language that the hon. Member for North Norfolk used in the amendment—that is, investigating—rather than the Minister's term, establishing the facts. Is that a conscious decision on his part and, if so, can he explain why?
Rob Marris: The exact words used are not important. I used the word ''investigate'' because that is the word in the amendment. If there were some other formulation encompassing a spirit of inquiry, I would be happy to use it.
The ACAS code says that the employer must establish the facts promptly and, where appropriate, have taken statements from available witnesses. That brings us back to the establishing of facts that my hon. Friend the Member for Manchester, Central mentioned. I would be pleased to see such a formulation included in the schedule. I am worried that an employer may be able get round schedule 2 and clause 34 and avoid an investigation by saying that it would have made no difference anyway. That goes against the whole spirit of what the Government are trying to do as a statutory minimum.
Alan Johnson: It would be a foolish employer who would take that view. Let us be clear about this. We are talking about what is necessary, not what may be sufficient. Every element of the system is discernible because it is so important. Clause 34 provides for the no difference test and other clauses deal with admissibility. The whole ethos and thrust of our proposals is that these are internal procedures and they should be used. Mitigation is involved if one has not used them and cannot establish that one has done so.
This is a simple three-step procedure that can be verified at each stage. Was the letter sent? Did they have the meeting to discuss the issues and convey the decision to the employee? Did they have the appeal? To bring in the question of whether there was an investigation clouds the whole issue at an important point in the procedure. Are they to be given a three-month extension to enable them to complete the proceedings? The employer would be foolish in those circumstances because the facts of the case would come out at the tribunal. The ACAS code is clear, and there is no doubt that the tribunal would insist that the size of the company should be taken into account in all cases. It is unlikely that the code would not apply in terms of establishing the facts.
If the need to investigate were part of the statutory procedures, one would run the risk of employers thinking that they are protected because they have gone through the motions. It would be possible to argue that one has investigated a particular case by considering it for two hours on a Thursday afternoon, but once the case was explored in more detail at tribunal it would become apparent that the investigation was a perfunctory exercise in going through the motions. The duty to investigate and establish the facts is in section 98(4) of the Employment Rights Act 1996, and it ensures that a dismissal will be unfair if an employer has not taken adequate steps to find out the facts. It is not the ACAS code that is at issue, although it may be relevant. There is no need to add an element of uncertainty to the statutory procedures.
Mr. Hammond: The Minister has described a perfunctory investigation as going through the motions, which introduces an interesting concept. Is he saying that in order to comply with the standard procedure the tribunal would want to look behind the mere fact that the meeting took place, and inquire into the state of mind in which individuals approached that meeting? Would he describe a meeting as perfunctory if the employer did not approach it in a genuine spirit of trying to resolve the matter? I am curious as to whether the concern about perfunctoriness that he has raised pervades the whole of the procedure.
Alan Johnson: No. The three-step procedure must be complied with otherwise the dismissal is automatically unfair and one does not get past first base. Whether the employer conducted the meeting in the way suggested by the hon. Gentleman would come out at the hearing stage as the case progresses through the employment tribunal. There is no argument between us on the principle, but there is a point about how we should frame the statutory procedures. The wording of the amendment is deficient because it suggests that one must have a full investigation. In many cases, the investigation would take place at other stages in the process. The amendment is unnecessary in terms of the concerns expressed by my hon. Friends because of section 98(4) of the 1996 Act. The hon. Member for North Norfolk should withdraw the amendment, and if he does not do so the Committee should oppose it.
Norman Lamb: I am happy to withdraw the amendment. Amendment No. 30 was a probing amendment. In the case of the tidying-up amendment, I agree with the Minister that it is sufficient to refer to the statement in schedule 2(1)(2). However, I would like him to consider the issue further and take account of the concerns expressed by both Government and Opposition Members.
The Minister states that everything in the standard procedure is discernable. In the sense that a meeting is a meeting that is true, but a meeting that ended in three minutes would allow an employer to say, ''I have complied with the standard procedure.'' However, in all other senses, and certainly under the ACAS code, it would not amount to a fair dismissal because of the deficiency of that meeting. Something that is ''set out in writing'' could establish in detail allegations against, or concerns about, an employee, or it could be very perfunctory. The standard procedure appears discernible, but there is considerable latitude, so it would seem sensible to set out a basic requirement of investigation. I concede that the hon. Member for Manchester, Central has thought of a much better way of establishing the facts, and the wording in the ACAS code would indeed meet our concerns adequately.
I urge the Minister to consider establishing a basic requirement to ascertain the facts. He has mentioned measures that go beyond the standard procedure, but in our view—many on the Government Benches seem to agree—part of the bottom line should be a basic requirement to establish the facts. As I have said, employers will be able to argue endlessly at tribunal that, because they followed the standard procedure, the dismissal was fair and the failure to establish the facts properly made no difference.
My amendment draws a distinction between dismissal on the ground of redundancy and other types of dismissal. I should like the Minister to explain further how the new standard procedure overlays existing case law guidance on procedures that must be followed in a proposed redundancy case. Neither the explanatory notes nor anything that has been said today has made that clear. It is terribly important that employers and employees understand the requirements for future redundancy cases, and if such clarification were given I would be prepared to withdraw the amendment.
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