House of Commons - Explanatory Note
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Detriment for use of union services or refusal of inducement

184.     Clause 25. The general effect of section 146 as it is at present, is that an employee already has the right not to have action taken against him by his employer that subjects him to any detriment where the ground for taking the action is membership of an independent trade union, non-membership of any trade union or taking part in the activities of an independent trade union at an appropriate time. Clause 25 amends section 146 to add to the grounds on which workers (see the explanation of clause 24) have the right not to be subjected to any detrimental action.

185.     Subsection (2) of the clause amends subsection (1) of section 146 and has the effect that a worker has the right not to be subjected to any detriment by an act (including a deliberate failure) done by his employer for the purpose of preventing or deterring him from making use of trade union services at "an appropriate time" or penalising him for doing so.

186.     Subsection (3) of the clause amends subsection (2) of section 146 to extend the meaning of "an appropriate time" already contained in the section to the use of trade union services. The result is that the definition of "an appropriate time" used here is the same as that used in the new section 145A(2) inserted by clause 23.

187.     Subsection (4) of the clause inserts new subsections (2A) to (2D) into section 146.

188.     New subsection (2A)(a) defines "trade union services" to mean services made available to a worker by an independent trade union by virtue of his membership of the union. Subsection (2A)(b) states that references to a worker's making use of trade union services include "consenting to the raising of a matter on his behalf by an independent trade union of which he is a member", so ensuring that a worker consenting to his union raising a matter is regarded as making use of union services.

189.     New subsection (2B) has the effect that if an independent trade union raises a matter on behalf a worker who is a member of, the union, with or without his consent, penalizing him for that is to be treated as penalising him for making use of union services.

190.     New subsection (2C) gives a worker the right not to be subjected to any detriment by an act (including a deliberate failure) done by his employer because of the worker's failure to accept an offer infringing the worker's rights under new sections 145A or 145B inserted by clause 23.

191.     New subsection (2D) has the effect that where a worker is not given a benefit that he would have been given had he accepted an offer infringing his rights under section 145A or 145B, the failure by the employer to give him the benefit shall be taken to subject him to a detriment. This ensures that a worker treated in this way can complain to an employment tribunal not only about the making of the offer that infringed his rights but also about the detriment resulting from the failure to give him the benefit contained in the offer.

192.     Subsection (5) repeals subsections (3) to (5) of section 148 of the 1992 Act (consideration of complaint under 146 of the 1992 Act). Subsections (3) to (5) of section 148 of the 1992 Act currently have the effect that where an employee is subjected to a detriment by an act, or deliberate failure to act, by his employer this is not caught by section 146 if the employer's purpose is 'to further a change in the relationship with all or any class of his employees'. This expression covers the case where an employer makes an offer for the purpose of inducing employees to give up a right to have their terms of employment determined under a collective agreement, that is to say the situation that arose in Wilson and Palmer, and therefore means that section 146 does not currently give any protection to employees in that case.

193.     Subsections (6) and (7) amend section 151(1) of the 1992 Act which contains interpretative and other supplementary provisions. Currently section 151(1) has the effect (a) that references in sections 146 to 150 of the 1992 Act to "being, becoming or ceasing to remain a member of a trade union" include references to being, becoming or ceasing to remain a member of a particular branch or section of that union or of one of a number of particular branches or sections of the union, and (b) that references to taking part in the activities of a trade union are to be similarly construed.

194.     The effect of subsections (6) and (7) of clause 25 is to replace the part of section 51(1) relating to taking part in the activities of a trade union with a new subsection (1A) of section 151 securing that references in sections 146 to 150 to "taking part in the activities of a trade union" and to "services made available by a trade union by virtue of membership of the union" relate to taking part in the activities of and the services made available by a particular branch or section of the union or one of a number of particular branches or sections. This ensures that the interpretation to be given to these expressions in sections 146 to 150 is consistent with that to be given to them in new sections 145A to 145E (inserted by clause 23) by virtue of new section 145F.

195.     Subsection (8) repeals section 17 of the Employment Relations Act 1999. Section 17 of the 1999 Act provides a power for the Secretary of State to make regulations to protect workers against dismissal and detriment for refusing to enter into an individual contract which includes terms different from those in a collective agreement which would otherwise apply. Section 17 has never been commenced and is superseded by clauses 25 and 26.

Dismissal for use of union services or refusal of inducement

196.     Clause 26 amends section 152 of the 1992 Act (dismissal on grounds related to union membership or activities), the present general effect of which is to make it automatically unfair to dismiss an employee if the reason or principal reason for dismissal is membership of an independent trade union, non-membership of any trade union or taking part in the activities of an trade union at an appropriate time. Clause 26 amends section 152 to add to the reasons that make the dismissal of an employee automatically unfair.

197.     Subsection (2) of the clause amends subsection (1) of section 152 and makes it automatically unfair to dismiss an employee if the reason or principal reason for his dismissal is that he had made use, or proposed to make use, of trade union services at an appropriate time, or that he had failed to accept an offer made in contravention of new sections 145A or 145B inserted by clause 23.

198.     Subsection (3) of the clause amends subsection (2) of section 152 to extend the meaning of "an appropriate time" already contained in the section to the use of trade union services. The result is that the definition of "an appropriate time" used here is the same as that used in the new section 145A(2) inserted by clause 23.

199.     Subsection (4) of the clause inserts new subsections (2A) and (2B) into section 152.

200.     New subsection (2A)(a) defines "trade union services" to mean services made available to an employee by an independent trade union by virtue of his membership of the union. Subsection (2A)(b) states that references to an employee's making use of trade union services include "consenting to the raising of a matter on his behalf by an independent trade union of which he is a member", so ensuring that an employee consenting to his union raising a matter is regarded as making use of union services.

201.     New subsection (2B) has the effect that if the reason or principal reason for dismissing an employee who is a member of an independent trade union is that the union raised a matter on his behalf, with or without his consent, the employee shall be treated as being dismissed for making use of union services.

202.     Subsections (5) and (6) amend section 152(4) of the 1992 Act which currently has the effect (a) that references in section 152 to "being, becoming or ceasing to be a member of a trade union" include references to being, becoming or ceasing to be a member of a particular branch or section of that union or of one of a number of particular branches or sections of the union, and (b) that references to taking part in the activities of a trade union are to be similarly construed. The effect of subsections (5) and (6) is to replace the part of section 152(4) relating to taking part in the activities of a trade union with a new subsection (5) securing that references in section 152 to "taking part in the activities of a trade union" and to "services made available by a trade union by virtue of membership of the union" relate to taking part in the activities of and the services made available by a particular branch or section of the union or one of a number of particular branches or sections. This ensures that the interpretation to be given to these expressions in sections 152 is consistent with that to be given to them in sections 146 to 150 by virtue of section 151 (as amended by clause 25), and in new sections 145A to 145E (inserted by clause 23) by virtue of new section 145F.

Other rights of workers and employers

Right to be accompanied

203.     Clauses 27 and 28 make amendments to legislation relating to the "right to be accompanied" in disciplinary and grievance hearings.

204.     The Employment Relations Act 1999 Act introduced a statutory duty on employers to permit workers to be accompanied by a companion who falls within the category of people listed in subsection (3) of section 10 (a fellow worker or certain trade union officials) at certain disciplinary and grievance hearings that the worker is invited or required to attend. The provisions in the 1999 Act build on the existing guidance provided in the Acas Code of Practice on "Disciplinary Practice and Procedures in Employment". This stated that disciplinary procedures should give individuals the ".right to be accompanied." The Code of Practice has no legal force, though a failure to comply with the Code can be taken into account by employment tribunals.

205.     Section 13 of the 1999 Act defines 'disciplinary hearing' as a hearing which can result in the administration of a formal warning, the taking of some other action against the worker or the confirmation of such a warning or action taken. A 'grievance hearing' is defined as a hearing which concerns the performance of a duty by an employer in relation to a worker.

206.     Section 10 of the 1999 Act provides that the duty applies where a worker is invited or required by his employer to attend a disciplinary and grievance hearing, and reasonably requests to be accompanied by a fellow worker or union official. The "companion" is permitted to address the hearing (but not to answer questions on behalf of the worker) and confer with the worker during the hearing.

207.     Section 11 of the 1999 Act provides that a worker may present a complaint to an employment tribunal that his employer has failed or threatened to fail to comply with the right to be accompanied. Section 12 provides a right not be subject to detriment or dismissal on the grounds of having exercised or sought to exercise the right.

Role of companion at disciplinary or grievance hearing

208.     Clause 27 clarifies the role of the companion at disciplinary hearings by amending section 10 of the 1999 Act. New subsections (2A), (2B) and (2C) replace the current subsection (2). New subsection (2A) reiterates that the employer must permit the worker to choose the companion as long as the companion falls within the category of people in subsection (3) (which is not being amended).

209.     Subsection (2B) expands on what the employer must permit the companion to do at a hearing. Paragraph (a) of subsection (2B) provides that the companion will now be able to address the hearing to (i) put the worker's case; (ii) sum up that case; and (iii) respond on the worker's behalf to any view expressed at the hearing. Paragraph (b) of subsection (2B) repeats the current provision in the 1999 Act that the companion may confer with the worker during the hearing. The companion is thus able to address the hearing on more than one occasion, at the beginning, at the end, and during the hearing to respond to views expressed.

210.     Subsection (2C) provides that the employer is not required to permit the companion to answer questions on the worker's behalf (paragraph (a)), address the hearing if the worker indicates that he does not wish the companion to do so (paragraph (b)), or use the powers in a way that prevents the employer from explaining his case or any other person making his contribution (paragraph (c)).

211.     Subsection (2) of clause 27 ensures that references to the right to be accompanied in section 11 of the 1999 Act refer to the extended meaning specified in subsections (2A) and (2B).

212.     Subsection (3) of clause 27 adds a new subsection (3A) to section 12 of the 1999 Act. It seeks to make it clear that where a worker attends a hearing as a companion of another worker, he is protected against detriment and dismissal not only in respect of the act of accompanying the worker but also for addressing or seeking to address the hearing (as permitted under subsection (2B)).

Extension of jurisdiction of Employment Appeal Tribunal

213.     Clause 28 corrects an oversight in the 1999 Act. It ensures that the Employment Appeal Tribunal has jurisdiction to hear appeals against employment tribunal decisions in relation to the right to be accompanied.

Ways in which provisions conferring rights on individuals may be made

214.     Clause 29 makes a technical amendment to section 23 of the 1999 Act.

215.     Section 23 gives the Secretary of State the power by order to confer the employment rights contained in specified Acts and in subordinate legislation implementing European legislation on individuals that do not have the rights

216.     As the words of the section stand, the order is only allowed to achieve these results by means of provisions that amend the legislation conferring the right, and not by means of a provision simply saying that the right applies to the individuals in question (a free-standing provision). New subsections (5A) and (5B) have the effect that an order will be able to extend employment rights either by the use of a free-standing provision or by amending the legislation conferring the right.

Flexible Working

217.     Clause 30 amends the law to extend to those taking advantage of the statutory provisions about flexible working certain exemptions to standard qualifying conditions for unfair dismissal.

218.     Section 104C of the Employment Rights Act 1996 ("the ERA 1996 Act") provides that where an employee is dismissed, and the reason (or the main reason) is that the employee made or proposed to make a flexible working application, exercised or proposed to exercise a right under section 80G, brought proceedings against the employer under section 80H, or alleged the existence of any circumstance giving grounds for bringing such proceedings, he will be regarded as having been unfairly dismissed.

219.     Section 237 of the 1992 Act provides that an employee dismissed while taking part in unofficial industrial action has no right to complain of unfair dismissal. Section 238 of the 1992 Act has the general effect that an employee dismissed while taking part in official industrial action or involved in a lock-out only has a right to claim unfair dismissal if some of the other employees taking part or involved are not dismissed or (where all are dismissed) if he is not offered re-engagement and some of the others are.

220.     Subsection (1) and (2) of clause 30 add section 104C to the list of exemptions to these provisions. Accordingly an employee dismissed for a reason connected with a flexible working application can complain of unfair dismissal despite being involved in official or unofficial industrial action.

221.     Subsection (3) inserts a new subsection (7BA) into section 105 of the ERA 1996 Act. It ensures that where an employee is selected for redundancy and the reason or principle reason for his selection was one of those specified in section 104C this will be treated as an unfair dismissal.

222.     Subsection (4) adds section 104C to the list, contained in section 108(3) of the 1996 Act, of exemptions to the requirement for one year's qualifying service before being able to bring a claim for unfair dismissal. To qualify for the right to request flexible working, an employee need only have 26 weeks' continuous employment (in addition to other qualifying factors). This subsection ensures that the protection against unfair dismissal contained in section 104C applies to all employees qualified to request flexible working.

223.     Subsection (5) adds section 104C to the list, contained in section 109(2) of the 1996 Act, of exemptions to the rule that an employee who has reached the "normal retiring age", or otherwise the age of 65, may no longer bring a claim of unfair dismissal. This subsection ensures that the protection against unfair dismissal contained in section 104C applies to employees regardless of their age.

Information and Consultation

224.     Clause 31 enables the Secretary of State to make regulations regarding the right of employees, or their representatives, to be informed and consulted by their employer in relation to matters prescribed in the regulations. The regulations to be made under this power will implement the EC Directive on Information and Consultation (Directive 2002/14/EC) which establishes a general framework for informing and consulting employees in the European Community ('the Directive').

225.     The Directive was agreed on 11 March 2002 and Member States are required to implement it by 23 March 2005. Article 1 of the Directive states that its purpose is to establish a general framework setting out minimum requirements for the right to information and consultation of employees in the European Community. The practical arrangements are left to Member States to determine. The Department of Trade and Industry published a discussion paper, High Performance Workplaces: The role of employee involvement in a modern economy, in July 2002. Discussions also took place with the CBI and the TUC on how the requirements of the Directive should be implemented. The CBI and TUC agreed on a framework for implementation and on the basis of that agreement, a consultation document, High Performance Workplaces: Informing and Consulting Employees, was issued on 7th July 2003 to seek views from a wider audience on the proposed scheme. Draft regulations were included in the consultation document. (A copy of both documents are available on the DTI website at www.dti.gov.uk/er/consultation).

226.     The powers under section 2(2) of the European Communities Act 1972, which are usually used to implement EU Directives are not considered sufficiently wide to cover all aspects of the proposed regulations, so this clause provides a general power to make regulations.

227.     Clause 31(2) provides that regulations made under this clause must make provision as to the employers to whom they apply. Paragraph (a) of clause 31(2) provides that these provisions may stipulate that the regulations apply to the employer's undertaking by reference to factors that include the number of employees employed in the undertaking; paragraph (b) provides that the regulations may stipulate the method by which the number of employees in the undertaking is to be calculated; and paragraph (c) has the effect that the regulations may apply to undertakings of different sizes from different dates.

228.     Article 3 of the Directive provides that Member States have the option of applying the implementing legislation to 'undertakings' employing at least 50 employees or 'establishments' employing at least 20 employees ('undertakings' and 'establishments' are both defined in Article 2). In either case, it is for the Member State concerned to determine the method for calculating the number of employees employed. The draft regulations apply to undertakings of 50 or more employees.

229.     Article 10 of the Directive contains transitional provisions which allow certain Member States to implement the Directive in stages until 23 March 2008 depending on the number of employees employed in the undertaking or establishment. The DTI intends to take advantage of this derogation and to provide that the regulations will apply initially to undertakings with 150 or more employees from March 2005, to undertakings with between 100 and 149 employees from March 2007 and to undertakings with between 50 and 99 employees from March 2008.

230.     Clause 31(4)(a) makes provision for the regulations to provide that employment tribunals will have jurisdiction to resolve disputes arising out of them and to confer jurisdictions on the Employment Appeal Tribunal; it is intended that this power will be used in relation to the protection of individual rights under the regulations.

231.     Clause 31(4)(b) enables the Secretary of State to confer functions on the Central Arbitration Committee and it is intended that this will be used to allow the CAC to resolve disputes under the more general provisions of the regulations. Paragraph (c) of subsection (4) provides that the regulations may require or authorise the holding of ballots and paragraph (d) provides that they may make amendments to, or apply similar provisions to, those in (1) the Employment Rights Act 1996 (in particular Part 5 which relates to protection from suffering detriment in employment; Part 10 which relates to unfair dismissal; and Part 13 which relates to particular types of employment), (2) the Employment Tribunals Act 1996 (which confers jurisdictions on employment tribunals and the Employment Appeal Tribunal), and (3) the 1992 Act.

232.     Clause 31(5) is a general power for the Secretary of State to make whatever additional provisions may be necessary to implement the requirements of the Directive and deal with related matters.

233.     Subsections (7) and (8) of Clause 31 provide that the regulations to are to be made by a statutory instrument that is subject to the affirmative resolution procedure.

PART FOUR: ENFORCEMENT OF MINIMUM WAGE LEGISLATION

234.     Clauses 32 to 34 amend the National Minimum Wage Act 1998 ("the 1998 Act") and the Agricultural Wages Act 1948.

235.     The 1998 Act has the effect that all qualifying workers are entitled to be paid at least the rate of the national minimum wage, as set by regulations made by the Secretary of State. Section 13 allows the Secretary of State to appoint enforcement officers to pursue national minimum wage cases on behalf of workers. The Secretary of State has appointed the Inland Revenue to enforce the national minimum wage, except that, in the agricultural sector, agricultural wages officers (who in England and Wales are officials of the Department of the Environment, Food and Rural Affairs) enforce the national minimum wage whilst enforcing the agricultural minimum wage. Section 14 sets out the powers of enforcement officers to obtain information, and sections 15 and 16 set out the ways in which information gathered by officers may be used. Schedule 2 of the Act amended the existing legislation relating to agricultural wages to provide, inter alia, that the enforcement regime for the national minimum wage was to be the enforcement regime for the agricultural minimum wage.

236.     If an enforcement officer believes that a worker or workers have not been paid the minimum wage by the employer in question, an enforcement notice can be issued under section 19. If the employer fails to comply with the enforcement notice, the officers have the power to take further action. They may bring a case against the employer through the courts or tribunals (section 20) and/or issue a penalty notice (section 21). A penalty notice imposes a financial penalty on the employer, related to the period of his failure to comply with the enforcement notice, in addition to any arrears of the national minimum wage.

237.     Clause 32 inserts a new section 16A into the 1998 Act. As sections 15 and 16 currently stand, restrictions apply to the use and supply of information obtained by enforcement officers. In particular, information must not, generally speaking, be supplied to any other person or body and, even where this is permitted, the authorisation of the Secretary of State is required. Because of these restrictions, it is considered that, when investigating an alleged breach of the 1998 Act, enforcement officers are unable to inform the worker what the employer or the employer's records revealed about the worker's claim, and similarly are unable to inform the employer about the case put forward by the worker.

238.     Subsections (1) and (2) of new section 16A accordingly allow an enforcement officer to disclose information obtained by the enforcement officer (e.g. from the employer) to the worker where that information relates to such worker.

239.     Similarly, subsections (3) and (4) of new section 16A enable an enforcement officer to disclose information obtained by the enforcement officer (e.g. from the worker) to the employer where that information relates to such employer.

240.     Subsection (5) of new section 16A defines what the terms "agency worker", "enforcement officer" and "the relevant legislation" mean for the purposes of this new section 16A of the 1998 Act. The definition of "the relevant legislation" ensures that agricultural wages officers (in England and Wales and in Northern Ireland) have this new disclosure power when enforcing the agricultural minimum wage.

 
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Prepared: 4 December 2003