Examination of Witnesses (Questions 100-120)
ACAS
24 JANUARY 2006
Q100 Mr Weir: We have heard a lot
about there has been a reduction in collective bargaining over
the years and a lot more bargaining is done on an individual basis
between employer and employee. Do you think that we need Acas
to become involved in that individual dispute resolution?
Mr Taylor: I do not necessarily
accept the premise that there has been a massive reduction in
collective bargaining. There has been a massive reduction in days
lost through industrial action and actual disputes that we get
involved with, but at any one time we are running alongside many,
many other disputes which never see the light of day because the
parties do not particularly want it to be known that Acas are
involved. There is still a considerable amount of activity taking
place collectively. On the individual point I really do not have
anything original to add to what the other witnesses have said,
except to say that in terms of the Exchequer our intervention
saves a huge amount of cash, £30 million, and there are various
sums around the fact that we help GDP. Could another organisation
do it if it was not Acas? I guess the answer is yes. Would it
be more expensive? Could it create the 30 years worth of reputation
that we have got overnight? I think the answer is probably no.
On the basis of that I would say that we offer a very good, value
for money service. In addition to that conciliation service of
course we then provide a window into advice and information because
there are your `offenders', let us get them back into rehabilitation—it
is my point about not wanting repeat business—because what
we would then do is try to work with the employer to make sure
that we do not end up in a tribunal once again.
Q101 Mr Weir: Do you feel that by
being a taxpayer-funded organisation you are saving the taxpayer
money by your work? The argument would be that these are individual
employment contracts that are being disputed, why should the state
be paying to finance that dispute? Your argument, if I hear you
correctly, is that you are actually saving money by becoming involved
in that, is that correct?
Mr Taylor: It is correct. There
is another argument which is not for me to make, but I would expect
the employers to make, about the polluter pays here. In essence,
it is Government which passes regulation, either here or in Brussels,
and creates an environment in which employers have to operate.
Employers pay taxes; is it a legitimate use of taxpayers' money
to somehow mitigate those effects by funding an organisation like
Acas.
Q102 Mr Weir: As I understand it,
at present you only become involved in the mediation of individual
disputes once an application is submitted to a tribunal. It may
not be a proper question when you are looking at cuts in organisation,
but do you see that there is perhaps a role for Acas with earlier
intervention before it gets, as you put it yourself, on the stressful
way of getting to a tribunal?
Mr Taylor: Could I ask Sue to
expand on that?
Ms Clews: There is enormous scope
for work pre-tribunal. We have piloted, as a response to the Better
Regulation Taskforce a couple of years ago, which made a similar
suggestion, a mediation service where we would go into an organisation,
particularly a small firm where there is not the HR expertise,
to try and sort out some sort of dispute while it is perhaps at
a grievance stage or even before a grievance has been raised.
That has been very successful in terms of resolving those disputes
without them turning into a tribunal application. Take-up was
limited, I have to say, so I think that is something around maybe
how we publicise that and about giving employers the confidence
that having a third party in is not such a scary thing, but it
might actually be good for them and their employee relationship.
Particularly around issues such as bullying and harassment, where
we get large numbers of claims at the moment, even personality
clashes between two employees, there is a lot we can do there.
Obviously, an issue for us at the moment is how we would fund
that, so through the pilot—we are rolling the pilot out
nationally—we are charging for that. That is an area that
we clearly need to think through as to whether in the long term
that is in the best interests of employers and employees. At the
moment it does not fall within our statutory duties.
Q103 Chairman: We have been asking
witnesses about this issue of the seven and 13 week fixed periods
for conciliation; do you have a view on that subject?
Mr Taylor: It is a little early
really to take a view as to what has happened. Certainly, we did
have a view as Acas and in our evidence to the Government's White
Paper—this was way back in 2002—we suggested that
this could have wings but it would be best to be piloted out rather
than introduced. The Government itself has committed to a review
in October of this year, and we will feed in more studied thoughts,
but broadly speaking, if we just look at it in headline terms,
we are still producing the same amount of conciliated settlements,
though there are issues about quite a steady and quite a massive
drop in the number of applications. When the TUC were giving their
evidence I think Sarah Veale explained there are concerns from
some people about access to justice in terms of is this now such
a bureaucratic process that people are actually giving up. We
are only seeing the people who actually enter the tribunal system
and we are still providing the same kind of results.
Q104 Chairman: The jury is out.
Mr Taylor: Yes.
Q105 Mr Clapham: The organisation
was born in 1975 and has had an enormous impact on the UK industrial
scene, and we have heard this morning from both trade unions and
employers who say it has been a very positive impact. Given that
at the time Acas was born the academic writers of the Sixties
and early Seventies were arguing that it would help to embed democratic
procedures in industry, and given what has been said about the
reduction in the number of days lost through industrial disputes—but
nevertheless there is still a great deal of collective bargaining
that goes on—is there a case to say that Acas should still
be promoting collective bargaining? What is your view on that?
Mr Taylor: This is one of these
classic ones where the Acas Council would not have a view. There
is clear consensus that getting information and consultation right
in the workplace has to be a good thing, whether it is a unionised
workplace or not. In the everyday conduct of our work we do get
into situations where an employer has a sizeable number of employees
who are members of a union and the employer does not want to recognise
the union; it is not for us to direct the employer, we would set
out the pros and cons, the benefits or any disadvantages there
might be, but generally speaking we are very partial when it comes
to getting information and consultation right. How someone wants
to do that is a matter for them. History shows that when Acas
was given statutory recognition powers back in the late Seventies/early
Eighties it did throw into question its impartiality and there
were difficulties with the employers remaining on the Council.
I will be diplomatic and stop at that.
Q106 Mr Clapham: Can I then just
take you on to the changed area that you are focusing on? You
are now focusing on good employment relations and from that, presumably,
hoping that conflict resolution will be reduced. Given that many
more employers come to you than previously—I note from the
Workplace Survey that 26 per cent of employers come to you, compared
with 16 per cent in 1998—it would therefore indicate that
your services are seen to be of great worth. Is there any evidence
to show that conflict resolution has been reduced as a result
of you focusing on good employment relations?
Mr Taylor: There is not any blindingly
direct evidence. What we have seen is that as we have invested
in advice and information the general trend is for employment
tribunal applications—if you want to use that as a proxy
for conflict management—to actually come down. What is difficult
to know is whether that is because we have got relatively full
employment or is it because of our intervention? We know that
for every case that comes to a tribunal there are another six
or seven that could potentially come to a tribunal, and we know
just from listening in to our helpline that every day we are probably
averting somebody going to the tribunal, but we have not got any
real hard and fast evidence. It is something that we will be looking
at.
Q107 Mr Clapham: But for the future
it is quite clear that that is where your focus is going to be,
good industrial relations.
Mr Taylor: Yes.
Q108 Mr Bone: I want to go back to
something you said previously. The wonderful thing listening to
this is the fact that you have managed to build your impartiality
across the board, it seems to be the key to the organisation and
the evidence has been very impressive on that. You have also mentioned
that you are doing quite a lot of work with the public sector
on the Government's public sector reforms; do you not think that
this could be the perception, that because you are promoting the
Government in that regard you lose some of your impartiality?
Mr Taylor: I do not think we are
promoting the Government. There is a political issue for the public
sector unions to face up to, and that is will they fight all job
cuts or will they accept some reductions in job numbers. That
is an issue for unions and Government to resolve. Our involvement
is to work with the managers if you like, the employers, and the
unions in the public sector to try and implement life after the
cuts, if I can use that phrase for short.
Q109 Mr Bone: That is the problem,
is it not? There are the unions in the public sector fighting,
and I had some firemen on to me yesterday, very concerned about
their pension situation. I am sure you are not, but I am just
worried that the unions might therefore see that what you are
doing in trying to say after these reforms this is what is going
to happen, and we are going to help you with that, is promoting
something that they are not in favour of.
Mr Taylor: All I would say in
response to that is that if we went back to the 1990s when there
was a radical restructuring of the private sector with a real
impact of globalisation, the fact that there were job cuts there
has not led in any shape or form to our impartiality being questioned
by private sector unions. The big issue is the practical impact
of it where we help.
Q110 Chairman: I am glad that Peter
Bone mentioned pensions issues because before we come to the last
section with Claire Curtis-Thomas I just want to pick this up.
One of the big looming industrial disputes is local government
pension schemes, and there is real unhappiness among local government
workers, for which I have enormous sympathy, but there is also
a real problem out there financially, on which I also have enormous
sympathy for the Chancellor of the Exchequer. It is a huge political
question; can you have a role in that dispute which looks likely
to come without taking a view on the political question that lies
at the heart of it?
Mr Taylor: It is very difficult
to see a role around the big issue, that is a direct political
issue between unions and Government. We actually did get involved
in conciliating in a private sector company around the pension
fund last year, and that was really where the union's and the
company's actuaries disagreed—if you want to give somebody
a difficult task, try conciliating between two actuaries, it is
not easy. There has to be life after whatever will happen on the
pension debate and I really go back to what I said about the private
sector, that once you have gone through these troubled waters—and
every sector has this, every organisation has it—you have
to pick yourself up and continue being an efficient organisation.
That is where we would see our main role.
Ms Clews: Could I just add to
that. We do have a role in bringing together organisations at
a regional level to focus on those issues—for example, in
the North West we have got an employment relations forum where
we bring together regional fulltime officers from trade unions
and some of the employer associations, so that issues like what
can we do to prepare for pensions issues, age discrimination,
there is a forum for people to actually talk those issues through
in a more constructive manner than waiting until there is a particular
dispute. I understand that that will not solve those difficulties,
but at least it is an opportunity to have open communication and
a joint approach to trying to resolve those difficulties or at
least to head off some of the worst implications of them.
Chairman: We will move to the last section
of questioning. I am grateful for everyone's indulgence and being
here so late.
Q111 Mrs Curtis-Thomas: You were
here earlier on and you will have heard my questions around charging
for services. Does the fact that you charge for your training
compromise the integrity of the training that you provide?
Mr Taylor: In a short answer, no, and I will
expand on that in a second. I just want to make the point that
charging is not unusual for public sector bodies; most public
sector bodies which have a monopoly charge—driving licences,
passports et cetera—so we are not desperately unusual.
We are a bit unusual in terms of support for employers because
generally, in terms of training for example, there is massive
subsidised training given to employers. We are required to charge
for our training activities, which we used to provide for free.
Q112 Mrs Curtis-Thomas: But you do
not have people coming to you saying because you are charging
for this I am going to get a biased training programme, based
on the fact that I have paid you. You do not get criticisms like
that, do you?
Mr Taylor: No, perversely we get
the opposite. If you want some biased support you go to a solicitor
and he or she will give you the answer that they want.
Q113 Mrs Curtis-Thomas: If you had
to charge for your services, would you still provide impartial
services or would your impartiality be compromised by the fact
that you had to charge for them?
Mr Taylor: I do not believe so,
because what we are advocating is good practice. If we worked
with an employer, we would not work with an employer if that employer
did not have an engagement strategy for his or her workplace.
Q114 Mrs Curtis-Thomas: What I am
trying to establish here is that charging for a service does not
mean to say that you cannot provide an impartial service for that
money, because I have heard this morning—and you will have
heard—from other witnesses that there is a notion that by
charging for something it somehow renders you partial. I am glad
to see that, like me, you do not believe that that is the case.
Mr Taylor: Certainly for training
and advice I do not think it has compromised our impartiality.
Q115 Mrs Curtis-Thomas: But you do
think it might—the inference is there—compromise you
in conciliation services?
Mr Taylor: Sue mentioned mediation
a little bit earlier and we have started to charge for that, and
that has not, as far as we can see, compromised our impartiality.
The difficulty with individual conciliation is that the first
time we know anything about this is when the individuals put their
claim into the employment tribunal and we get a copy of the papers,
and what has happened once someone has got to a tribunal is the
relationship between the individual and the employer has broken
down big-time. The conciliation process is difficult enough, to
try and get those two parties back speaking to each other, without
them requiring the employer, or the employer and the individual,
to actually pay, because then a new hare would start running about
who was to blame for this. If you are an employer and a litigious
individual puts in a claim against you, and you are completely
innocent, you are going to be faced with spending a lot of money
at an employment tribunal. The last thing that you want to do
is also spend a lot of money in terms of trying to get a conciliated
settlement. The benefit of our intervention is that we drive down
the cost for both the employer and the individual.
Q116 Mrs Curtis-Thomas: Are you comfortable
about the fact that it is the public actually that fund this service
and yet the vast majority of beneficiaries so far are large companies.
Should this not be a cost that they bear on the bottom line, not
necessarily the cost of that service coming to you but going to
the Treasury? Your service at the moment is being compromised
by budget discussions in the DTI; have you not looked at the possibility
of recovering the cost from business to pay for your service,
to continue to do that service which is obviously valued by business
itself?
Mr Taylor: Companies and individuals
pay for our service through general taxation; Government takes
a view about whether or not this is a sensible use of public money
and Government has taken the view that providing the conciliation
service free at point of delivery is a sensible thing to do. Our
view and our experience would say that is the correct decision
because certainly when we look at our colleagues in the United
States, the FMCS—the Federal Mediation and Conciliation
Service—they rejected the thought of charging for their
collective services on the very grounds that both the employers
and the trade unions mentioned this morning.
Q117 Mr Binley: I am going to be
slightly more robust than Claire, but working on the same lines,
because it seems to me that you have got two things that you are
not appreciating. The first is that you have a tremendous brand—I
do not think you understand what value that has. Secondly, with
SMEs you have a tremendous marketplace that you are not even tapping
into to any great extent. I listened to the big monoliths and
they horrified me, quite frankly, with their attitude. It seems
to me that you have tremendous pre-tribunal, pre-problem abilities—let
us take charging for a website of 160 quid that is updated regularly,
specific access. I reckon I could sell that and make a great deal
of money, quite frankly. Let us look at the problem of SMEs where
we know from the Employment Trends Survey that all those employers
with fewer than 50 employees settled in every tribunal claim they
faced in 2004-05, despite the fact that in 46 per cent of the
cases they were advised that they were likely to win. That is
a massive payout by SMEs that you could tap into by stopping,
and it seems to me that you need an injection of entrepreneurialism,
quite frankly, because I do not think that it would get mixed
up with your arbitration services but would in fact go a long
way to providing a service that small businesses that have not
got the expertise need to buy and that a marketplace exists to
buy. Can I ask you to respond to that?
Mr Taylor: I will ask Sue in a
second to bring you up to date on some of our thoughts about a
subscription service to SMEs but I do not think I can accept your
assertion that we have not been entrepreneurial. We have grown
the business from nothing—
Q118 Mr Binley: So did I.
Mr Taylor: That is why I described
it as entrepreneurial. We have grown the business from nothing,
with a workforce who were recruited for a completely different
skills set in order to provide a conciliation service. We have
also harnessed new technology and we have to go through a whole
series of hurdles set by the Treasury to make sure that we are
not competing unfairly against the private sector, so I would
say that our staff have responded magnificently to create the
revenue streams that we have actually created so far. Sue, could
you respond?
Ms Clews: I am sure you are right
that there is a lot that we can do and we are taking steps forward.
There are two things I will cover, first the subscription service
which we have considered as a way of getting to more small firms,
because we do try and publicise ourselves, but with the number
of businesses there are, we are clearly not making massive inroads—we
are making some, but not at a quick enough pace. We are looking
at ways in which we could try and have more of an ongoing relationship
with smaller firms so that we are their first thought when they
have a people issue, when somebody is late, when somebody does
not turn into work—
Q119 Mr Binley: Contracts of employment
assistance.
Ms Clews: That is right; we are
looking at whether there is some mechanism, either alone or with
other organisations, so that when a new business sets up or when
it takes on its first employee it could in some way be linked
to Acas. We are working on that at the moment to try and find
a method that does not compete with other organisations but reaches
the SMEs that, frankly, do not have anybody to support them. That
is one thing we are doing. The other thing is to work with the
regional organisations which are very keen to promote entrepreneurship
within business. We know that management and leadership training
is woefully inadequate for a lot of small firms, they have other
pressures to concentrate on, so we are trying and get our relationship
with regional development agencies so that we can input where
perhaps Business Links are not able to do that, so to try and
help other small firms that way. We would welcome a further discussion
on ideas around that certainly.
Q120 Chairman: Positively the last
question, which flows directly from that: it is a funny old entrepreneur
that works hard to raise money for someone else. Brian Binley
has suggested that you should be more entrepreneurial, but every
time you are entrepreneurial you raise money for Gordon Brown.
Mr Taylor: If we had a funding
agreement which allowed us to incentivise staff in the institution
then life would be easier, chairman, yes.
Chairman: Thank you very much for that
last answer. I am very grateful to you for your endurance in a
rather long session.
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