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The Parliamentary Under-Secretary of State for Trade and Industry (Jim Fitzpatrick): I am grateful to my hon. Friend for giving way. I know he is keen to conclude his remarks. I confirm that which has been communicated to him and that which we have been
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very clear about—that whereas the Government are fully committed to delivering the Warwick agreement and the manifesto commitments that we put before the people at the 2005 general election, we said in respect of the agency and temporary workers agreement that we would agree with the principles of the directive and see what could be delivered domestically. We did not agree, with the greatest respect, to that which is contained in his Bill, which is equal treatment from day one. There is the matter of the qualifying period, which is under discussion in Europe in the context of the directive still being discussed there.

Paul Farrelly: I thank my hon. Friend for confirming that the Government are committed to pressing ahead with UK legislation, which the Bill is intended to give them the opportunity to do, while the directive is stalled in Europe. As for the qualifying period, I shall come to matters of detail shortly. Those matters can equally be discussed in Committee and are no reason for opposing Second Reading.

At Warwick, the Government committed themselves to addressing discrimination against agency workers by backing, as my hon. Friends said, the principles of a European directive on the issue and making early progress on it. Sadly, the directive has been at an impasse since 2002, in part because of the objections of the UK and other countries.

Mr. Andrew Dismore (Hendon) (Lab): I support my hon. Friend’s Bill. I listened to his remarks earlier. Will he suggest that when our hon. Friend the Minister winds up the debate, he give us a timetable for when the Government will act on the matter, rather than talk about it?

Paul Farrelly: I hope that my hon. Friends will be disciplined enough in their contributions to allow the Minister to respond.

Jim Fitzpatrick: My hon. Friend the Member for Hendon (Mr. Dismore) asked when the Government intend to act on our commitments in our manifesto and to our party and affiliates, as arrived at in Warwick. We published our consultative document on temporary, agency and vulnerable workers on 20 February, so we are clearly indicating that we are living up to our manifesto commitments, and that we will legislate domestically where that is possible. There is an open question for trade unions and hon. Members to contribute to the consultation so that we can close the loopholes and fill the gaps where people are being abused in situations where that should not be allowed to occur.

Paul Farrelly: The consultation does not address the principles of the Bill, which concern deep-rooted discrimination on pay and working conditions, although it addresses the problem of talent agencies charging people fees for being wannabe pop idols.

Mr. George Howarth (Knowsley, North and Sefton, East) (Lab): Along with many hon. Members, I hope that my hon. Friend’s Bill makes progress. Does he agree that it is necessary to close the advantages that certain agencies use with regard to Her Majesty’s Revenue and Customs that have led to some workers
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paying less tax and national insurance than others? Perhaps we should address that in the Finance Bill in addition to his Bill.

Paul Farrelly: There is a problem in the building industry, which has revenue implications because of the activities of agencies.

Meg Hillier (Hackney, South and Shoreditch) (Lab/Co-op): Does my hon. Friend agree that although the Government’s moves to introduce flexible working are welcome, they have left us in a bizarre position on employees and flexible working? Many of my constituents are agency and temporary workers because they want flexibility, but they do not get the corollary of decent basic working conditions.

Paul Farrelly: Indeed. The situation has left us with a permanent two-tier work force.

I thank the Minister for confirming at this week’s meeting that, in line with commitments made at Warwick, the UK will look at domestic legislation, which is what the Bill seeks to achieve. It is difficult to understand the hostility of the Department of Trade and Industry and its officials to the Bill.

To dispel another myth, this Bill tracks the principles of the directive nigh on word for word. It defines basic working and employment conditions, which are contained in article 3 of the draft directive. Clause 5 replicates the wording of the directive with one clarification, which is that pay should include an entitlement to sick pay. This week, we heard, through the lobby, from Maeve, an agency worker in Blackburn who has worked for BT through Manpower for the past two years. She told us that it was a them-and-us situation between agency and permanent employees—the haves and the have-nots. Maeve became very ill with pneumonia, but she could only afford to take 10 days off, because after two years of employment, she had no entitlement to sick pay. That is the reality for many workers in our economy today.

Why does the DTI object so strongly to the Bill? That is a very good question, and the answer is what we have heard from the Minister this week and again today. The DTI objects to agency workers qualifying for equal rights from day one. That has been one of the main issues stalling the directive. If the Government want to negotiate a qualifying period of six weeks, like the Commission, or nine months, which is their latest condition, then they should do it in Committee. If they have signed up to the principles behind the Bill and the directive, there is no reason to oppose the Bill on Second Reading. Any Whip, as the Minister formerly was, would tell any recalcitrant Back Bencher that they can argue about the detail in Committee.

Jim Fitzpatrick: My hon. Friend has made a fair point about the role of Committees, notwithstanding the Government’s support for the principles behind the Bill I understand the frustration of people who are employed for long periods of time and who are still classified as temporary workers, which is why the qualifying period in the draft directive is important. The qualifying period should be set reasonably and people should not be taken advantage of. That negotiation is taking place in Europe and not upstairs
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in the Committee corridor. We are happy to look at any abuses in respect of temporary and agency workers, which is what the consultation document addresses. I invite my hon. Friend and the trade unions that are supporting him to submit evidence to allow us to move forward in this important area.

Paul Farrelly: The trade unions will certainly submit evidence. Like many of my hon. Friends, I say that the discussions should not take place behind closed doors in Brussels but in the open here in London.

This week, we heard a couple of other objections—for example, an alleged difficulty in identifying those with work comparable to that of agency workers. Jane in Salford, Steve in Scotland, Bartek from Poland and Maeve, recovering from pneumonia in Blackburn, would have no trouble identifying someone doing exactly the same job in their workplace. Furthermore, their union reps would say that the concept is well understood in other equal pay legislation from our own Government. If a reasonably comparable worker doing the same or a similar job in the firm or industry could not be found, such people simply could not take a discrimination case to an industrial tribunal. Again, do not object to the issue on Second Reading.

The other objection that we have heard this week—we have heard only three, really—was that there are difficulties over the meaning of “equal treatment” for agency workers in respect of maternity rights. The Government have been very good in progressing the agenda for pregnant women; if we want more precision, we can get it in Committee. If the Bill goes to Committee, it is not beyond the bounds of possibility that we might help the Government clarify their case.

I want to conclude with the positives of the campaign. The Bill has had an airing, albeit brief. A Department of Trade and Industry consultation saw the light of day last week; it is too narrow and does not touch on the main issues and basic principles of the Bill, as signed up to at Warwick, but at least it gives the workers the chance to highlight further abuses.

Jim Fitzpatrick: Does my hon. Friend accept that page 49, section E of the consultative document states that we will listen to and pay attention to any evidence that is taken? I do not understand how he can describe the consultation as too narrow, given that an open question at the end of the consultation document says, “Give us the evidence”.

Paul Farrelly: I welcome the Minister’s assurance, which repeats what he said in the meeting this week, that he will listen to the evidence. Frankly, we find it worrying that most of the evidence cited so far has come from employers’ organisations. However, there is plenty of evidence for the trade unions, and we shall encourage them to submit it.

Finally, I should say that Jane, Steve, Bartek and Maeve and many thousands like them would like to hear from the Minister now the real reasons why the Government are opposing Second Reading of this sensible Bill. I hope that Members will give the Minister the opportunity to make a more detailed response.

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2.7 pm

Mr. Owen Paterson (North Shropshire) (Con): I congratulate the hon. Member for Newcastle-under-Lyme (Paul Farrelly) on doing well in the ballot; as a birthday present to him, I shall be extremely brief. We all want to hear what the Minister has to say.

It is important that we get the balance right between protecting employees and providing employment. We support the Government’s intention to address bad practices that affect agency workers, but this Bill contains provisions that would change the principles of existing employment and contract law. The effect of those changes would, I believe, be to the significant detriment of job creation in our country.

Contracts with temporary workers are formed under specific circumstances for specific reasons. We should be cautious about allowing the Government to interfere with the ability of employers and employees to contract in such circumstances. Limiting the ability of employers to take on employees on a flexible or temporary basis has the potential to stifle business. It would also restrict opportunities for those who can work only on a temporary basis. Despite the Government’s commitment to introduce measures to ease the administrative burden on agencies, the Bill contains a number of provisions that would increase the administrative burden on any business wishing to employ someone on a temporary basis.

Obviously, that would have a serious impact on businesses that by their nature rely on being able to employ workers on a temporary and flexible basis. Businesses with seasonal fluctuations, or those that rely on market demand to decide staffing levels, are heavily dependent on being able to staff their businesses efficiently through temporary or agency workers. There seems to be a risk that the more restrictions that are placed on such contracts, the more difficult it will be for agencies to maintain the fluidity of supply so crucial in that area of employment.

There is also the risk of a knock-on effect by which the increased liability and administrative burden placed on businesses by the Bill would force employers to stop taking on agency workers. That would massively restrict the options open to those able to work only on a temporary basis—for example, students or those looking after young children.

It is necessary to ensure that we achieve a proper balance between the rights of the employer and the employee, and we are currently considering the whole policy area of employment rights with a view to coming up with proposals that will get the balance right. This Bill, however, is not the answer.

2.8 pm

Mr. Alistair Carmichael (Orkney and Shetland) (LD): I am required to place on record that my party does not support the Bill. I am grateful for having had the opportunity to do so.

2.9 pm

The Parliamentary Under-Secretary of State for Trade and Industry (Jim Fitzpatrick): Let me begin by congratulating my hon. Friend the Member for Newcastle-under-Lyme (Paul Farrelly) on being successful in the
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private Members’ ballot and commending him for choosing this issue. I acknowledge the concern that there is for vulnerable workers in many situations.

I believe that the Government’s record in this area is to be commended. We have introduced a raft of protections for people in the workplace—

Ian Stewart (Eccles) (Lab): I accept that the Government’s actions in this field have been good, but does the Minister accept that the actions of some bad agency employers—I acknowledge that there are good ones—need to be addressed quickly, and that the Bill would do that?

Jim Fitzpatrick: I hear what my hon. Friend says. I certainly agree that there are some unscrupulous employers out there. They are not restricted to agency worker employers—some employers who are regarded as mainstream also undermine and take advantage of workers’ rights.

Our position is that we want to deal with abuses as and when they are identified. I was about to explain how much has already been accomplished and what more we expect to do. The recruitment agencies are in the process of drafting their own code of practice. As my hon. Friend the Member for Eccles (Ian Stewart) says, there are decent agencies out there, some of which act as recruiting agents for trade unions—

Mr. Deputy Speaker (Sir Michael Lord): Order. We had this problem earlier this morning. The further away the Minister gets from the microphone, the less he will be heard by anybody. Moreover, he should address the Chair. It would be helpful were he to bear both those things in mind.

Jim Fitzpatrick: I am, as ever, grateful for your advice and guidance, Mr. Deputy Speaker, and I will try to comply with both your suggestions.

Patrick Hall (Bedford) (Lab): I agree that not all employment agencies and employers exploit people. Nevertheless, I should like to refer my hon. Friend to an example that is receiving attention in Bedford concerning the exploitation of mainly Polish workers. Because they are vulnerable and their English is not very good, their wages are being docked by way of a whole list of methods. I have reported this to the police and to Revenue and Customs. It is a detailed example in a real place—I have met many of the people involved personally—that he may wish to take on board when he considers the outcome of the consultation. Would he be prepared to meet me to discuss it in detail?

Jim Fitzpatrick: I certainly would not reject a request from a colleague on either side of the House to discuss issues of importance to themselves as constituency MPs, particularly when it involves people being abused or maltreated or relates to Government regulations on health and safety, the minimum wage, paid time off, paid rest breaks, or whatever. If my hon. Friend would be so kind as to supply me with the relevant information, we can feed it into the system and organise a meeting so that we can have a proper dialogue and report back to officials at the Department of Trade and Industry’s employment agency standards
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inspectorate, who are responsible for policing the regulations and ensuring that employment agencies conform to the regulations that have been passed by this House.

Let me return to my hon. Friend the Member for Eccles, who asked about employment agencies that do not observe the protocols and regulations or best practice as regards the people for whom they are supposed to be finding work. As I said, the recruitment agencies themselves are in the process of drafting a code of conduct. When agencies undermine people’s rights, they tarnish the reputation of the whole industry and undermine decent agencies for temporary and agency workers that are doing the right thing in trying to ensure that their recruits are treated favourably. I accept that there are problems but I emphasise that we have an inspectorate, we investigate complaints and, if my hon. Friend has information and details about cases, I am happy to ensure that the appropriate officials receive them.

The Government’s record is to be commended. However, we want to ensure that no one is exposed to unfair treatment because of gaps or loopholes in our employment law. Much is happening. My hon. Friend the Member for Newcastle-under-Lyme referred to the agency workers directive. It is fair to say that that has stalled in Europe for some time. However, Department of Trade and Industry officials were in Brussels on Wednesday to raise the prospect of progress on detailed negotiations.

My hon. Friend said that the details in the Bill mirror the wording of the directive and asked why we could not simply transpose it into United Kingdom law. I acknowledge that he emphasised that he does not want to disadvantage the UK compared with our colleagues in other European Union member states. However, the directive’s text is a draft and will be subject to amendment. It would therefore be difficult to deal with the current text in isolation now.

Tony Lloyd (Manchester, Central) (Lab): Does my hon. Friend accept that his point that the directive has not only stalled but long stalled in Europe means that many people believe that it will not make progress? Can he give some idea of when the Government will conclude that no progress will be made in Brussels, and that it is therefore necessary to introduce domestic legislation? We need to know when.

Jim Fitzpatrick: I shall deal shortly with the consultative document that we have published. We might have been able to publish it earlier; we did so only last week. It is subject to a normal 12-week consultative period. As soon as that concludes, we will weigh up the submissions to the Government and make recommendations.

My hon. Friend the Member for Newcastle-under-Lyme made the point that the main issues are defined too narrowly. I have referred to section E on page 49 of the consultation document and I shall revert to it later. The matters that we have identified are those on which we can move quickly and about which we have evidence to demonstrate that we need to move to close loopholes and tackle problems.

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