Select Committee on Environment, Food and Rural Affairs Minutes of Evidence

Examination of Witnesses (Questions 160-179)

Wednesday 21 May 2003

Mr Peter Allenson, and Mr Don Pollard

  Q160  Mrs Shephard: —is another matter.

  Mr Pollard: Yes.

  Q161  Mrs Shephard: Can I just ask, are you in touch with Citizens Advice Bureaux who have a wealth of evidence and information which could help you?

  Mr Pollard: Yes.

  Mr Allenson: Can I just mention my experience as a local officer in Cambridgeshire. Certainly we were in touch with the CAB, they would refer people to us, particularly on employment issues and we had a good working relationship with them. What I found, again as a local officer, was the real fear of people was firstly coming forward and then secondly being able to act on the information that we were able to give them. As a union we do continually want to see some of the divisiveness taken out of this particular situation. There can obviously sometimes be friction between the directly employed staff and the staff who are coming in employed by gang labour for all sorts of reasons. We are keen to see people treated fairly and equally and we believe registration, again, would be a way of ensuring that is brought forward. It would not be perfect. I dare say that some of the people using and abusing the system will learn to manoeuvre in particular ways but I think it would remove a great deal of the unfairness that there is presently in the system.

  Q162  Mr Jack: In the field of agriculture and horticulture, the principal customer for many of the users of gangmaster labour are supermarkets. Supermarkets, as you will know, lay down very tight specifications for all of the activities which are associated with the production of the products for sale in their stores. The impression we get is that the form and use of labour is not currently part of that overall specification. Have you got any indication as to whether you think the supermarkets take this as an area of importance and have had any influence at all on the employment policies of those who are their suppliers?

  Mr Pollard: I think they are taking it seriously in so far as they accept it is a problem and in some ways it is a publicity problem. If it comes out that one of the supermarkets is using a supplier who uses illegal labour it goes against the supermarket so, therefore, they are concerned about it from that point of view. I think the point to be made is that they are very good on technical and quality control but not so good on social and labour rights. That is not necessarily a problem because they have not got the experience. Dealing with labour rights and social rights is not an easy topic, it is not as easy as doing quality control and technical control. Most of their advisors and most of their managers are not experienced in that side of it, and that is where they fall down. However much they are concerned about it, most of them have social awareness officers in their business, some have their own codes of practice as well as belonging to the Fresh Fruit Producers Consortium code of practice as well, they are taking it seriously but they have not yet developed an effective way of monitoring it.

  Q163  Mr Jack: Do you think they should?

  Mr Pollard: Yes, definitely I think they should. I think if they were as concerned about labour rights as they are about quality control, much more could be done.

  Q164  Mr Jack: Is the increasing use of gangmaster labour a direct function of the greater price pressure which producers are experiencing currently?

  Mr Pollard: I think experience would say that it is. As you have price pressure it goes back to the grower and the packhouse who have to find ways of cutting their cost as well. Either you become more efficient, more technical, or you cut back on your labour or you cut back on the payment to your labour. In that sort of chain of things the weakest link is the worker himself or herself and that is where the pressure is eventually going back to.

  Q165  Mr Jack: Mr Pollard, when we first started to take evidence on this, that would have been my assumption but one of the views which was put to us was that in fact there is a rate for gangmaster labour and if there are illicit practices going on, a worker is being exploited, it is not the user of the labour who benefits but the gangmaster who pockets the difference. Can you help us to give us a feel as to which of those two views is correct or is it both?

  Mr Allenson: My view would be that it is probably somewhere in between. I think the price pressure does have an effect but in itself is not necessarily the answer. Certainly it would assist if the supermarkets were to be better in terms of the prices that are paid to growers and some of that may filter through. Certainly without a doubt in the present situation some of it would leak through to other parts of the system before it filtered down to the worker at the bottom. Can I just say as well, in terms of the supermarkets, obviously this has been a high profile issue for a number of years. I referred to the press and media attention to this earlier. That has been a factor in terms of sometimes you may wonder why particular people are also on board with this registration request for legislation for that. The reality is of course it is high profile, everybody wants to be seen to be doing morally the right thing, especially when consumers are reading the papers and listening to the television programmes, etc. The classic example of that is that of course they have tremendous pressure at the sharp end in terms of the growers. I know of situations where people have, because of that pressure, had rest facilities made available to them, for example toilet facilities on the field now compared with what they used to have in the past. Some of that has been legislation driven, before that it was supermarket driven because they were concerned about the image.

  Q166  Mr Jack: Can I just ask Mr Pollard, especially, whether in your researches you have come across any data which enables you to tell the Committee what the difference might be between, if you like, the hourly rates charged by gangmasters for their workforce, the rate that might apply to a normal agriculture or horticulture worker and anything about the rates paid to the workers themselves?

  Mr Pollard: Obviously the rate paid to the workers, if they are covered by the Agricultural Wages Order, is already set.

  Q167  Mr Jack: This is really the question as to whether in fact the people who are being exploited would be able to benefit from the Agricultural Wages Order? My intuitive guess is they may not and they are not in a position to protest if they get a lower wage. How much do we know, if anything at all, about what workers from the diverse backgrounds that we discussed earlier in our discussions actually get compared with what they ought to get?

  Mr Pollard: There is another problem connected with that. The wage that they get, even if it is a statutory amount, either minimum wage or agriculture wage, is not necessarily what they get in their pocket because of the deductions, most of which are illegal. You could be paying somebody £5 an hour, and I have seen cases where the gangworkers have got less than £2.50 when it came to the actual wages because of deductions from the wages, many of which—probably most of which—are illegal. The only legal ones are national insurance and income tax without the proof of the worker. Even where there is a wage paid which looks legitimate, what actually goes to the worker, especially if they are an illegal immigrant worker who has come here probably as a result of a loan where he came from, interest charged on that loan is really horrendous, plus in the few cases where I have seen a payslip they have put down administrative charges, no explanation of what that is but there is another deduction as well. I think we have to look at the deductions from the wage even where it is legal. This whole question about if you increase the price paid by the supermarkets to the growers and to packhouse people, will that go to the worker, that is a pretty difficult question. I suppose, the only way you could do it, you are probably all familiar with Fair Trade and the official Fair Trade situation where you pay extra for the product you buy but you are guaranteed that money goes to the worker or a co-operative of workers so they can spend it for the best benefit of their situations.

  Q168  Mr Mitchell: You are not very keen on voluntary codes, are you? Why do you think the voluntary codes which have been introduced by the Fresh Produce Consortium and the NFU fail?

  Mr Allenson: This is a personal view, again no hard evidence in respect of this. First of all, the voluntary codes are just that, they are voluntary. The gangmasters we have found have very quickly realised that and as a consequence will not bother abiding by the voluntary codes. No independent verification, no enforcement at the end of that. Unless there is some remedial action that can be put to some of the people who are dealing within these types of situations, any voluntary code I think is unlikely to work in our view. We have had now certainly two voluntary codes and neither of them seem to have made the situation any better, in fact during their period of time the situation seems to have got even worse.

  Q169  Mr Mitchell: Do you think that is a mutually convenient arrangement for people who do not want to do anything about it?

  Mr Pollard: Certainly it makes it easier for them: who is monitoring it, how often are they monitoring it, are they independent monitors, are they experienced and trained monitors, if they find a violation do they change the supplier? I have mentioned earlier two cases of where gangmasters as a result of VAT fraud are in prison, their companies are still operating. They are still supplying the supermarkets they provided before. That is one of the reasons why we have some scepticism about voluntary codes.

  Q170  Mr Mitchell: If you persuaded suppliers and farmers not to use gangmasters who do not accept a voluntary code, would that not work?

  Mr Pollard: I think we have to remember who we are dealing with. We are not dealing with reasonable people in many cases, in some cases we are actually dealing with criminal elements and you do not go to a criminal and say "Here is a voluntary code, could you abide by that". Then you are dealing, also, with sharper edged business competition and it is not so easy in a tough situation like that to abide by codes of practice which are voluntary, particularly if you see so many others not abiding by it.

  Q171  Mr Mitchell: I was talking about the suppliers and farmers who are presumably all honourable men. You are not accusing them of being criminal elements but why would they want to employ criminal elements if you persuade them not to employ anybody who will not abide by the voluntary code?

  Mr Pollard: They might find it difficult to find anybody to work if they did that. It is a real problem about finding labour sources in rural areas. In a sense they contact a gangmaster and they say "We need 50 workers for two months" and they set a price between them and they do not even supervise those workers, although they may be working on their premises. Although it seems odd that farmers and packhouse people use gangmasters who are doing illegal acts, they are not employing those people their contact is somebody else. The actual employer is the gangmaster himself or herself.

  Q172  Mr Mitchell: Do they see anything of them? The packers and farmers, do they see anything of the labour or do they leave that to somebody else and wash their hands of it?

  Mr Pollard: They or their staff would see them because if they are in the fields probably a regular member of staff would be driving a tractor.

  Q173  Mr Mitchell: Would they not know if they are not operating minimum industry conditions, if they are working in appalling conditions and under coercion?

  Mr Pollard: I would say that many of them do know but some of them do not know. Basically they want that work done and the gangmaster provides that labour. Any situation like that it is mostly temporary, even if they are UK workers they would not necessarily know the labour that is there. There is obviously the other problem of language difficulties as well, especially with illegal immigrants.

  Q174  Mr Mitchell: You think it is in their interest to ignore the voluntary code largely, treat it as a fig leaf?

  Mr Pollard: I think many do. Many are concerned and make the checks, many growers and packhouse people, but there is also an equal number who want the work done at a certain price and that is the bottom line.

  Q175  Mr Mitchell: Can I just ask you a couple of questions. The Daily Mail today—I always read it to find out what is going on in the world—says that people are being attracted into this country by the prospect of black market jobs or the black economy. You mention an involvement of criminals from Eastern Europe, what is the scale of involvement of asylum seekers?

  Mr Pollard: Again, just drawing on the Sussex experience where there seems to be a far greater percentage of asylum seekers in that area therefore working illegally, if you are asylum seeking and are here less than six months you cannot work and if you go to seek work then you are working illegally. Now the gangmaster knows those people are the most vulnerable, they cannot complain or do anything else so therefore they are the most abused. After your six months if you are working legally or allowed to work legally then you are treated a bit better. There are a large percentage of asylum seekers who, I would say, are forced into that situation because of the structure we have got now.

  Q176  Mr Mitchell: There are several whose last appeal has expired or been rejected, then they lose accommodation because the agency turfs them out and they lose benefit. They are presumably the kind of willing participant: any job in that situation?

  Mr Pollard: Of course. I think sometimes, especially as a result of media presentations, you think all these asylum seekers or other illegal immigrants are freeloaders. In my experience all the illegal immigrant gangworkers work incredibly long hours, often in poor accommodation, they send back whatever money they can to their families and if they had the opportunity to pay tax or national insurance they would do that as well. It is just the situation they are in. They are made out to be these sort of bogey men and women living off the state and coming to this country, sometimes we forget a lot of our people went off to Canada, America, Australia, New Zealand and they are in this position now. I do not see anything wrong with economic migrants.

  Q177  David Taylor: Earlier on there was a discussion on the extreme lengths gangmasters are willing to go to in order to avoid their responsibilities. Do you think the inability of the police—an example would be in Lincolnshire—to supply sufficient resources to investigate allegations of coercion and threats and illegality encourages an atmosphere where they believe they can flout all reasonable employment laws? The police in Lincolnshire, Chairman, have stated that such enforcement visits, such activity is financed out of their overtime budget. They do not have an overtime budget because they are cash strapped and therefore this is a very low priority for them. Is that your experience as well?

  Mr Pollard: It is a low priority and it is a very complicated and time consuming priority for the police. If you look at it, in the end who gets prosecuted, who gets legally taken care of—

  Q178  David Taylor: Victims.

  Mr Pollard: —the worker and the people who are profiting from them very seldom do. Where we see prosecution of gangmasters it is for VAT fraud or national insurance non compliance or income tax non compliance it is almost like Al Capone and people like him, eventually they put those people in prison not for the physical crimes they committed but for tax avoidance. There are a minuscule number of gangmasters who have been prosecuted and mostly the prosecutions have been of illegal workers who are then sent back to where they came from.

  Q179  David Taylor: You would like to see the police being more rigorous?

  Mr Pollard: When they make a raid on a packhouse and they arrest 50 people who are illegal immigrants, they have not even got space in their cells to put them, much less all the follow up work of bringing them to the court.

  Mr Allenson: Could I just quickly add something in terms of that last question because there is a resource issue all the way through I think in terms of the various agencies which are involved. Our experience has been, for example, in Health and Safety, in respect of the Wages Inspectorate, there is a resource implication all the way through. In particular, because there are a number of agencies involved, although, for example, Operation Gangmaster may have had a much better co-ordinated approach to the situation, there is still an unco-ordinated approach in many respects to some of these situations and certainly a resource implication. Again, that is why we believe a registration scheme should be brought together that would bind it all together and identify the resources which have been needed to do this which in many ways would be almost self-funding because of the level of national insurance and tax revenue which is being drawn out because it is not being paid at the present time.

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