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14 July 2008 : Column 96

Mr. Clifton-Brown: All right. I will give way for the last time.

Michael Jabez Foster: That is very generous.

The hon. Gentleman shares the justified prejudice of us all against the BNP. Does he agree that the trade union movement has a reasonable case, and that the Bill should reflect that by enabling it to expel BNP members?

Mr. Clifton-Brown: As I said, if the Government legislate not to deal with individuals’ or even individual parties’ prejudices, but to specify circumstances, which is what the Bill will have to do in order to comply with the ECHR, I would support clause 18, which would allow unions to expel members who behaved in an unacceptable way. The ASLEF case invoking the ECHR proved the difficulty, and I think the issue needs to be clarified in the light of that case.

We feel that the Bill contains good measures, but some of its provisions need clarification while others will impose burdens on businesses. I am sure that my hon. Friends on the Committee will wish to examine them in depth and to try to ensure that the Bill emerges from the Committee in a more workable form, certainly in the context of employment tribunals. That is incredibly important, because, as my hon. Friend the Member for North-East Hertfordshire pointed out, the increase in the number of tribunal cases since 1998—from 29,000 to 130,000—proves that there is a huge need for it.

The Government—or, rather, the Opposition—will not vote against the Bill tonight, but we will wish to discuss it further in Committee, and we will reserve our stance on Third Reading. However, we do not think sufficient time has been timetabled in respect of the conclusion of the consultation on the code on 24 July and the Bill’s ending—unnecessarily we believe—by 23 October. That will not give sufficient time for Members to make representations after hearing from their constituents over the summer recess.

The Prime Minister has said that simplification, clarification and cost saving are all at the heart of the Bill. The Opposition support those principles and we will support those parts of the Bill that aim to achieve them and that seem likely to do so. However, the record of this Government has been to pile complexity and burdens on employers and any changes they make are likely only partially to reduce the burdens they themselves have introduced. We will be watching the Government carefully to see if they reduce the burdens on business.

8.19 pm

The Minister for Energy (Malcolm Wicks): I agree with the hon. Member for Cotswold (Mr. Clifton-Brown) in one respect: the Government will not be voting against this Bill tonight.

As my hon. Friend the Minister for Employment Relations and Postal Affairs said, the Employment Bill will make important improvements to key areas of employment law. It will put in place an enforcement framework that provides increased protection for vulnerable workers and reputable businesses, and it will reduce the regulatory burden of resolving disputes at work, to the benefit of both businesses and individuals. This twin approach—increasing protection for the vulnerable while reducing regulatory burdens—is crucial to meeting current
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and future economic challenges in the UK. Since 1997, developments in UK employment policy have been based on achieving a labour market that combines fairness with flexibility.

John McDonnell: To re-establish my credentials as a socialist, may I ask why, after 11 years of this Government, trade unionists still do not have the same rights that they had after Taff Vale in 1906? Why under this Government can we have events such as Gate Gourmet where people can be sacked on a whim’s notice, having been undermined by agency workers? The proposed legislation does not even address those issues. How is it that we can wait so long under a Labour Government and yet trade unionists here are still denied the rights that other trade unionists have across Europe?

Malcolm Wicks: My hon. Friend is wrong on this, as he is on so many matters now, sadly. There has been a significant extension of trade union rights. The Bill is about improving another important aspect of trade union and civil liberties: the national minimum wage, which is the subject to which I shall now turn.

As an amateur political historian, I found it interesting to hear Conservative Members try to justify why once upon a time they voted against the minimum wage. One Member agonised about what he would have done. Apparently, they now support a national minimum wage. I am reminded—

Mr. Heald: Will the Minister give way?

Malcolm Wicks: Not just yet, no, although obviously the hon. Gentleman’s party has given way on the national minimum wage, and we should be grateful for that.

Mr. Walker: Will the Minister give way?

Malcolm Wicks: I will do so later, as there is plenty of time.

The Conservative party’s position on the national minimum wage, and also more recently Opposition Members joining in the celebrations of the 60th anniversary of the national health service, reminded me of Tony Crosland saying in his book, “The Future of Socialism”—if I can be forgiven for using that word—that as the Conservative party has accommodated to a modern democracy, it now proudly wears the medals of battles it has lost. That is true for the national minimum wage and the national health service.

Mr. Clifton-Brown: Will the Minister give way?

Malcolm Wicks: Let me make a little progress.

We are determined now to go after the minority of employers who do the wrong thing.

Mr. Clifton-Brown: Will the Minister give way on the comments he has just made?

Malcolm Wicks: Yes; on the battles the hon. Gentleman’s party has lost, of course I will give way.

Mr. Clifton-Brown: I am grateful to the Minister for giving way, because he is teasing us all the way along the line. Has his party never changed its mind? May I mention clause 4?

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Malcolm Wicks: Only in the sense that we now have a far better clause 4, because we believe in improvement and modernisation.

Mr. Walker: Will the Minister not accept that the ability to change one’s mind is the sign of a mature politician? I understand that he has changed his mind on nuclear energy, for example. Is he not a mature politician?

Malcolm Wicks: Sadly, I am even more mature at least in a chronological sense—I do not suggest in any other sense—than the hon. Gentleman. Of course, when the facts, circumstances or evidence changes, one should change one’s mind. Just to be accurate in terms of my own position, on civil nuclear I have moved from being nuclear-neutral to being in favour. However, I must not get back into my comfort territory, as I am in temporary employment tonight in talking about employment. [Interruption.] I do not want this to be an interview.

I was saying that we are determined now to go after the minority of employers who do the wrong thing by the minimum wage. Of course, the best protection we can offer is to strive to ensure that arrears do not arise in the first place. That is why the Bill strengthens the enforcement framework and increases the deterrent to non-compliance. It will provide greater support to vulnerable workers and fair arrears for the underpaid, and will help to ensure a level playing field for compliant businesses by making it clear both that underpayment is unacceptable and what the consequences will be. Many, including the TUC and the CBI, have welcomed the reform. The CBI has said:

Paul Farrelly (Newcastle-under-Lyme) (Lab): Will the Minister give way in the interests of balance?

Malcolm Wicks: I will give way to my hon. Friend in the interests of anything.

Paul Farrelly: Perhaps I can strike a different tone from that of my colleague, the hon. Member for Hayes and Harlington (John McDonnell). The Bill touches on agency workers and exploitation in respect of enforcement. Clearly, the CBI and TUC have recently agreed a compromise on the substance of the protection for agency workers—I addressed that matter as part of my private Member’s Bill last year—and I welcome that. Did the Minister note that neither the Conservative nor the Liberal Democrat Front-Bench team welcomed and supported that compromise tonight?

Malcolm Wicks: I did notice that, but clearly the parties are in a mood to address the evidence and to change, if the argument warrants that.

Mr. Heald: On a point of order, Mr. Deputy Speaker. Is it in order for the hon. Member for Newcastle-under-Lyme (Paul Farrelly) to make an intervention about the debate when he has not been involved in it? [Interruption.]

Mr. Deputy Speaker (Sir Alan Haselhurst): Order. That sedentary comment was not very helpful. The proceedings that take place do so in this Chamber, and
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those are the matters to which we shall refer. That was not a point of order, and the hon. Member for Newcastle-under-Lyme (Paul Farrelly) is entitled to intervene.

Malcolm Wicks: I am happy to take interventions. One comment made by my hon. Friend the Member for Hayes and Harlington (John McDonnell) dealt with the enforcement of the minimum wage. May I remind colleagues, as the Minister for Employment Relations and Postal Affairs did at the beginning of the debate, that in November 2006 the then Chancellor announced an increase in the budget for the enforcement and the monitoring of the minimum wage for the next four years, amounting to some £11.6 million of extra enforcement and monitoring money? I hope that hon. Members would agree that that is helpful. The enhanced budget enables us to respond in a highly effective way to the changing scene, through the recruitment of additional staff, more research and better communication. With the increased budget, Her Majesty’s Revenue and Customs is recruiting an additional 20 people in 2007-08, the majority of whom are front-line enforcement staff, the remainder being part of the minimum wage technical team, which works on supporting the helpline, for example, and inspectors on more complicated cases. We have also significantly increased our publicity budget, maintaining our focus on hard-to-reach groups. That work includes a radio campaign and, indeed, an outreach campaign.

John McDonnell: That matter was covered in an Adjournment debate in Westminster Hall some weeks ago, when we welcomed the £3 million of additional money, but reflected that at that point in time it had not resulted in an additional number of posts being filled. Vacancies in the department were already being held open, so there has not been the additionality in staffing expected by the then Chancellor of the Exchequer—now the Prime Minister—when he announced that money. I would welcome a letter from the Minister to the Public and Commercial Services Union, which is the union that has raised these points in the debate and still has not received an adequate response.

Malcolm Wicks: I hope that my hon. Friend will accept that there has been a great deal of extra publicity and that the minimum wage bus has been touring in the regions too.

Mr. Clifton-Brown: The Minister for Employment Relations and Postal Affairs told the House that 1,649 employers were non-compliant on the minimum wage, yet only 59 enforcement notices and 25 penalty notices had been issued. If the regulations are in place, surely it ought to be possible to get to grips with that huge number of non-compliant employers.

Malcolm Wicks: The emphasis has been on compliance. Now there will be an automatic penalty, and I have mentioned the extra money—£11.6 million—that the Chancellor has given the Department for extra enforcement. The hon. Member for Huntingdon (Mr. Djanogly) implied—I do not blame him; we all get confused by statistics—that only 5 to 10 per cent. of employers will get a penalty. For the record, that is not the case. A civil penalty will be imposed in cases in which an enforcement
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officer identifies that the minimum wage has not been paid correctly to any worker. That contrasts with the current regime, under which a penalty is payable only if an employer fails to comply with an enforcement notice. That supports what I was saying about the emphasis on enforcement. The misunderstanding arises because the 5 to 10 per cent. are those cases in which arrears exceed £5,000, so there is the potential for a Crown court prosecution with unlimited fine.

The hon. Gentleman also asked about the certification officer in relation to trade union powers. The certification officer has important powers to remedy failures by trade unions to follow their own rules. He can order a union to put right a breach of its rules, and that order is enforceable in the same way as a court order.

The hon. Gentleman raised the issue of the report by the TUC commission on vulnerable employment, which was issued some weeks ago. My hon. Friend the Member for Dumfries and Galloway (Mr. Brown) also asked about that. The House may be aware that the vulnerable workers enforcement forum has met over the past year, chaired by my hon. Friend the Minister for Employment Relations and Postal Affairs. It includes representatives from the TUC, the CBI and the National Association of Citizens Advice Bureaux, and from enforcement agencies. It has considered several important issues, such as the fear of reporting abuses, the lack of knowledge of to whom complaints should be reported, the co-ordination of enforcement between different Government agencies, and other issues of enforcement.

The forum considered the issues and heard evidence from many of the bodies that I have mentioned, including citizens advice bureaux, trade unions and representatives of migrant workers and the construction and hospitality industries. It will report in the near future, perhaps before the summer recess. That is not definite, but is one possibility.

The hon. Member for Brent, East (Sarah Teather), on behalf of the Liberal Democrats, raised the issue of the enforcement of employment tribunal awards. In most cases, such awards should be paid within 42 days of the judgment, unless the respondent decides to appeal the judgment. The exceptions are discrimination and equal pay cases, in which payment is due the day following the judgment. Unpaid awards may be enforced by application to the courts, in the same way as county court judgments, a system that will be streamlined by the provisions of the Tribunals, Courts and Enforcement Act 2007. The Ministry of Justice expects to introduce secondary legislation under the Act by April 2009 which will mean that if an award remains unpaid after 42 days claimants can go straight to enforcement in the county court or the High Court by a simplified route. The current Act separately provides for the tribunal to award compensation for the full financial loss in simple monetary terms—for instance, if credit card or mortgage payments fail because of the action of the employers.

Research will be undertaken by the Ministry of Justice to clarify how many claimants do not receive their awards, and the contributing factors to the failure. I should also say that my hon. Friend the Minister for Employment Relations and Postal Affairs will be meeting representatives of the citizens advice bureaux on Wednesday to discuss further the evidence from citizens advice bureaux.

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Sarah Teather: I raised all those points in my speech and acknowledged that the Government had made some changes in the 2007 Act. Nevertheless, what the Minister is outlining does not deal with the financial outlay that a claimant must make in order to take a case through the county court or the High Court. The registration issue is not the problem for individuals. I am pleased to hear that the Minister’s colleague will meet the citizens advice bureaux this week. I am sure that they will present all the evidence that he needs without further research.

Malcolm Wicks: My colleague looks forward to meeting the citizens advice bureaux, as well as our colleagues in the Ministry of Justice. We are aware of the problem and we need to find out more facts and to tackle it, but I was outlining some of the improvements that there have been.

Mr. David Drew (Stroud) (Lab/Co-op): Does my hon. Friend accept that one of the problems with the process is not only the non-payment but the wilful disregard with which some companies treat a former employee? They drag the process out as long as they possibly can, knowing that they will lose, but little can be done because the process has a momentum of its own. That surely is not fair in this day and age.

Malcolm Wicks: I understand that. Indeed, in my own constituency I have had experience of one or two such situations. I understand what my hon. Friend and other colleagues are saying. That is why we are not complacent. We are maintaining the dialogue and, if necessary, we will take further action.

My hon. Friend the Member for North Ayrshire and Arran (Ms Clark) raised a point, which was touched on by one or two other colleagues, about mariners. That is a complex matter, as my hon. Friend the Member for Wolverhampton, South-West (Rob Marris) said. Under current legislation, all resident and non-resident seafarers are entitled to the minimum wage while they are in the UK’s internal waters. A seafarer on a UK-registered ship anywhere in the world is entitled to the national minimum wage unless his employment is wholly outside the UK or he is not ordinarily resident in the UK.

International maritime law, and specifically the right of innocent passage, means that the UK is unable to apply legislation to ships sailing under the flag of another country. That is reciprocal. For example, British ships enjoy that right in the Gulf and when passing close to Saudi Arabia. If the Government were to apply further legislation just to UK flagships they would run the risk of those ships flagging out and diminishing the number of UK ships sailing under the UK flag, something that the Government are committed to preventing. If vessels choose to flag out, not only will the number of UK flagships diminish but the seafarers aboard will miss out on the other entitlements that sailing under the UK flag ensures.

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