Employment Bill

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Mr. Hammond: I beg to move amendment No. 134, in page 9, leave out lines 1 to 17.

The amendment would leave out proposed new section 171ZF, which deals with restrictions on contracting out. I want to raise with the Minister an issue of principle. I understand the desire to prevent avoidance of rights granted through this part of the Bill, but it is somewhat demeaning to treat grown men—it is they whom we are talking about—as though they were children by sending in the nanny state to protect them with its full force. In certain circumstances, employees, together with their employers, might want to consider a different way of packaging the overall benefits and leave entitlements available to them. A blanket prohibition on contracting out is therefore a little harsh. I would prefer that people were granted additional leave around the time of a child's birth in a way that was less inflexible.

In relation to another matter, we talked about the perfectly plausible circumstances in which an employee and an employer might both want to proceed in a way for which the Bill, as drafted, does not provide. The Minister will doubtless have up his sleeve the example of a downtrodden employee whose bargaining power with his employer is grossly unequal, and who might prove vulnerable in such situations. Far more often, however, the balance of power is much more even. Where relations are good and both parties are competent adults, it is wholly desirable that they negotiate the overall terms and conditions of

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employment themselves, rather than their being imposed by statute in minute detail. Indeed, in respect of certain matters, that might be the view of the trade unions.

The purpose of tabling the amendment is to get the Minister to defend the Government's view that the exclusion of contracting out is essential. Can he give examples of the mischief that he believes proposed new section 171ZF will prevent?

Norman Lamb: The amendment would remove the statutory right to paternity leave and paternity pay, in that it would enable an employer and employee to agree that such a right should not apply in a particular case. Having drafted many contracts of employment, I know that, were the legislation to provide such flexibility, plenty of employers—for perfectly good reasons, from their perspective—would instruct their lawyers to draft contracts of employment that excluded the right to paternity leave. If the amendment were passed, the Bill would provide a right for employers and employees to opt into paternity pay if both parties chose to do so. However, if it is not imposed as a statutory right with the opportunity to opt out, it will lose all statutory force.

I appreciate that the hon. Member for Runnymede and Weybridge wishes to see greater flexibility in the way that the provision works. However, in effect the amendment would create a bottom line in terms of the giving of rights by employers, below which they could not go. They would have every opportunity to be flexible above that bottom line, but no flexibility to go below it. That strikes at the heart of this part of the Bill.

Alan Johnson: The hon. Member for Runnymede and Weybridge did not make the case for contracting out. I do not have reams of examples of downtrodden employees. The hon. Member for North Norfolk is right to say that the provision lies at the heart of the Bill. We are introducing a statutory right, and people are entirely at liberty either to claim it or not. There is no requirement on them to take their paternity leave—they can choose not to do so.

Mr. Hammond: My argument is that someone who does not intend to take his paternity leave has no opportunity to trade it with his employer for something else. He cannot say, ''Give me a couple of extra days a year of holiday entitlement and I won't take my paternity leave.'' That is an old-fashioned constraint on people's ability to manage their own life and their own time.

Alan Johnson: The hon. Gentleman said earlier that it was demeaning to treat grown men as though they were children. Throughout all our consultations on the provisions, employers did not raise this matter with us once. All they said was that the costs of any statutory right to paternity leave should be met by the Exchequer, not left to employers.

The amendment would not only allow employers and employees to contract out, but would affect the position under the clause whereby employees are

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protected from having moneys deducted from their pay, except in certain circumstances where there is prior agreement. That would be the wrong path to take in both respects.

The provisions on statutory paternity pay exactly reflect those on statutory maternity pay. No one says that the fact that women have a right to statutory maternity pay means that we are not treating them as grown-ups. I do not see why the hon. Gentleman should suggest that it is a retrograde step for us not to allow a person to negotiate to take the money in another way. This is Government money from the Exchequer.

The hon. Gentleman must realise that in the majority of cases the measure that he proposes would be used as an inducement by the employer, who would say to his employee, ''You have a right to statutory paternity pay, but there is a get-out clause—if we give you an extra couple of days' leave you won't need to take it.'' Pressure will be put on that individual, who may one day feel that they have been disadvantaged by applying their rights. It would be entirely the wrong approach to enable employers to provide less than the statutory minimums. The amendment is wrong and potentially confusing to employers, who would face different regimes for a woman who seeks maternity pay and a man who seeks paternity pay. It is also wrong that it would not protect individuals from deductions from wages. The hon. Gentleman has not made a strong case for the amendment and I hope that he will seek leave to withdraw it.

12 noon

Mr. Hammond: I had intended to deal with pay and direct or indirect contributions in a short clause stand part debate, rather than in a debate on an amendment. The purpose of the amendment was to hear the Minister's view on the desirability of allowing individual or collective bargaining over terms of employment. That purpose has been served. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Mr. Hammond: I beg to move amendment No. 135, in page 10, leave out lines 6 and 7.

The Chairman: With this it will be convenient to discuss the following amendments: No. 136, in page 10, leave out lines 8 and 9.

No. 159, in clause 4, page 18, leave out line 28.

No. 160, in page 18, leave out lines 29 and 30.

No. 161, in page 18, leave out lines 31 and 32.

No. 163, page 18, line 38, leave out paragraph (c).

Mr. Hammond: I shall try to be brief. These probing amendments seek to remove paragraphs to obtain an explanation from the Minister of how the powers that they contain will be used. The lead amendment removes the paragraph that allows regulations to

    ''in particular, provide—for any provision of this Part of this Act to apply to any . . . person, notwithstanding that it would not otherwise apply;''

In other words, one can read the Act and work out who does not get statutory paternity pay, but the

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Minister has an ability, through regulation, to say that those people will get it anyway. Likewise, amendment No. 136 removes the paragraph that states that any person whom the Act defines as not being entitled to receive such pay can receive it anyway if the Minister says so. We want to understand why the Minister needs those wide powers, which, in practice, mean that the Bill might just as well say that statutory paternity pay should be payable to anyone whom the Secretary of State says it should be. If the Minister has specific cases or problems in mind, perhaps he will share them with the Committee.

Amendment No. 159 addresses people who are

    ''employed on board any ship, vessel, hovercraft or aircraft''.

Amendment No. 160 deals with those who are

    ''outside Great Britain at any prescribed time''.

Amendment No. 161 deals with those working on the UK continental shelf on oil and gas rigs. Those amendments allow the Secretary of State to disapply, apply or modify the new section in any way that he thinks fit. A large number of people will be affected, so how do the Government intend to apply the regulation-making powers to that substantial group?

Amendment No. 163 is somewhat different. It would delete the paragraph that gives the Secretary of State power by regulation

    ''for excepting any . . . person from the application of any . . . provision where he is neither domiciled nor has a place of residence in any part of Great Britain.''

I have sought to delete that paragraph because it is so self-evident that a person who is neither domiciled nor has a place of residence in any part of Great Britain should not benefit from the provisions of this part of the Bill that it need not say so. If that is not the case, perhaps the Minister will explain why.

Alan Johnson: In relation to amendments Nos. 135 and 136, new section 171ZI enables the Secretary of State to make regulations dealing with the application of statutory paternity pay to those employed or living outside Great Britain, mariners and continental-shelf workers. The provisions mirror those for statutory maternity pay, and we would expect to make regulations in the same way. Amendments Nos. 135 and 136 would remove paragraphs that will allow us to make regulations specifying who may or may not be eligible to receive paternity pay. Regulations under these paragraphs will be necessary if we are to follow the SMP model.

For example, the SMP legislation excludes a woman from receiving maternity pay if she is a mariner employed by a UK employer on a foreign-going vessel while under a contract for which an employer pays a special low rate of national insurance contributions, and we must mirror that in the paternity pay regulations. A woman who is a continental-shelf worker or a mariner employed by a UK employer would be covered by the SMP scheme. Employers and employees in these special circumstances know how the SMP rules work, and it is right that we should mirror those rules for statutory paternity pay.

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Amendments Nos. 159, 160, 161 and 163 relate to making it clear on the face of the Bill that people who are not normally resident in Great Britain and who do not maintain a residence here will not be eligible for adoption pay—the clause relates to adoption pay, not paternity pay. I accept that it is unlikely that situations will arise in which a person in those circumstances will qualify for adoption pay, but it is possible and should not be ruled out. It is possible, for example, to think of an employee working abroad for a UK employer who is still a British-employed worker for social security and tax purposes but who no longer maintains a British residence. That employee may want to take a year off work in order to adopt and care for a child. In such cases, as with a birth mother who is in a similar position, we might want to ensure that the entitlement to pay is safeguarded because the employee has earned that right.

I would not swear by the validity of that example, and I could not put my hand on my heart and say that I know exactly how we would use the regulations because we still have thinking to do in relation to the clause, including consultation with adoption experts. However, I hope that I have done enough to allow hon. Members to understand that there are issues about which it may be worth thinking, and it would be wrong to be inflexible and state once and for all on the face of the Bill that there can be no entitlement. That issue, and our desire to mirror the SMP regulations, are the reasons why we hope that the hon. Gentleman will withdraw the amendments.

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