Mr.
O'Brien: Again, I am listening with care to what is being
said. It is the case that in our discussions with employers
organisations they expressed some concerns that we should not move too
quickly to criminalise employers. There are sanctions here. We are
going to table a Government amendment in due course which will enhance
the value of our measure as a deterrent by preventing employers from
being able to claim back payments or benefits given to their workers as
part of any agreement that is rendered void by the clause.
At the moment our view is that
keeping this in the realm of employment law presents a strong enough
way of preventing employers from taking this action. We anticipate that
the vast majority of employers will comply with the legislation but he
is right to say that there may well be small numbers who take the view
that they can breach the law. That would not be a competitive approach
and is one which could do quite a bit of damage to the employers who
are complying properly.
I am listening with care to
what he says and interested as to how hard he is pushing this
particular proposal. We have taken a view up to now that we do not want
to move into the criminal law in this area. He seems to be pressing
quite hard that we should move into that area. I will be interested to
know whether he intends to press this new clause to a Division. It
might affect my view.
He did raise
a couple of other issues in relation to missed contributions and
whether they would be enforced. I should tell him that any
contributions that are missed would be enforced. It is the case that we
would have the ability to get the employer to move into a position
where they make up the missed contributions if a person ought to have
been automatically enrolled and would have wanted to have been part of
a pension schemein other words, would not have opted out. In
those circumstances, the TPR would be able to enforce the repayment of
those missed
contributions. Mr.
David S. Borrow (South Ribble) (Lab): Could my hon. and
learned Friend reassure me that should the problems raised by the hon.
Gentleman turn out to be true once the legislation has gone through and
is up and running, the Minister will be able to remedy the problems
quickly without bringing forward primary legislationto do it by
regulation rather than
legislation?
Mr.
O'Brien: We would not be able to regulate to bring in
criminal sanctions like that; we would have to do that in primary
legislation. I
am interested in how hard hon. Members opposite wish to press this. I
do not have a closed mind on it. I am happy to give way to the hon.
Member to indicate whether he, in principle, wishes to press this,
which may influence my view about whether the Government should take
this back and look at it again.
Andrew
Selous: I think that it is a serious issue for the reasons
that I have already outlined. If I heard him right, the Minister said
that he was prepared to go back to the Department, sit down with his
officials and perhaps look at the area again. If he is prepared to do
that, we would be prepared to bear with him, perhaps until Report
stage, to see what he comes forward with. It is an important point and
the point made by the hon. Member for South Ribble, who is behind him
now, is also important. I do not want the window of opportunity to do
something to move on and we then find that it is difficult to do
something about
later.
Mr.
O'Brien: I am grateful to the hon. Member. I would also
welcome the view of the Liberal
Democrats.
Danny
Alexander: I share the concern of the hon. Member for
South-West Bedfordshire that it is a very serious issue. If the
Minister is saying that he will take the issue away and look at it
again, perhaps with a view to coming back at Report stage or in the
other place so it can be properly considered by the Government, that
would be very reasonable. There does need to be an additional power in
the area. It seems wise not to press the matter, if the Minister is
going to go away and look seriously at how an amendment could be
framed.
Mr.
O'Brien: We are interested in proceeding
by way of consensus on this. The Governments view had been that
we did not wish to move into the area of criminalising employers in
this particular regard at this stage. There have been strong views
expressed by the Opposition, both Conservatives and Liberal Democrats,
on this. Indeed, among my colleagues there are some views that this is
an area where we need to have a firm response by Parliament to the view
that employers should not provide these sorts of inducements and that,
therefore, a criminal sanction ought to be given serious consideration.
Therefore, I agree to give that serious consideration to the views
expressed and take this back and talk to the various stakeholder
organisations, on the basis that there are obviously some strong
feelings in Committee today.
Amendment agreed
to. Question
proposed, That the clause, as amended, stand part of the
Bill.
Danny
Alexander: I simply remind the Minister that in the
earlier debate I made some important points about pre-employment
issues. I hope he will answer them in the coming
debate. 10.15
am
Mr.
O'Brien: I am also conscious of a point
made by the hon. Member for South-West Bedfordshire that I have not yet
dealt with. He asked me whether the regulator, as part of his role,
would be looking for unusual patterns of opt-out among employers and
employees. The answer to that question is yes, he will be. It is the
role of the Pensions Regulator to monitor the data in relation to the
level of opt-outs among employers. It will vary from sector to sector,
but we anticipate there will be an average level of automatic
enrolment, and that will enable the regulator to look for unusual
patterns of high opt-outs. It will then be able to intervene with those
employers to find out why those high levels are
present. If it is the
case that there is a non-unionised, low paid, edge-of-usual sector
practice that needs investigating, we would expect the Pensions
Regulator to be in a position where it could carry out a serious
examination of the circumstances in that employers
organisationindeed, for the very competitive reasons that the
hon. Gentleman identified
earlier. The hon.
Member for Inverness, Nairn, Badenoch and Strathspey asked some
important questions about pre-employment rights. We looked at this with
a great deal of care and were pressed by the TUC to consider whether
pre-employment rights should be present, because it would be
theoretically easy for employers to say We are not offering you
a job yet, but we are interviewing you and one of our questions will
be: are you going to sign up to the whole pensions deal? If you are, we
will take a decision based on that. So, in effect, before there
is a contract of employment, or an agreement, there is a view by the
employer that he will take a particular approach to an
employee. That is the
problem, and it is one of the reasons why we proposed Govt amendment
No. 156, which we just dealt with. It gives the employee the ability to
have had an inducement, to have accepted the inducementin the
sense of accepting any bung, as the hon. Member for
South-West Bedfordshire put itand then, as soon as he is
employed, to say Fine, thank you for the bung, Im going
to keep that, but I now want to be automatically enrolled in the
pension scheme and there is nothing that the employer can do
about that. If we
decided to create a new pre-employment right, then the concern of
employers organisations would be that there has been pressure
in the past to create all sorts of other pre-employment rights. While I
did not detect a great objection to this particular one, it was to some
extent a matter of principle for them, that creating a pre-employment
right in this regard would then raise the question, If you do
it on this, why are you not doing it in a whole series of other
circumstances? That would be quite a significant change of
principle in terms of the way we have operated employment legislation
heretofore.
So I think
the best approach is to put in place mechanisms to provide back-stop
assistance for employees who wish to be properly enrolled, and ensure
that we
have some financial sanctions for dealing with employers who seek to
offer inducements. The Conservatives have suggested that we go further
than that, and have criminal sanctions as well, but these would relate
to post-contractual rights.
Danny
Alexander: I do understand what he is saying, but it does
leave me feeling somewhat uneasy, because the message we are sending to
potential employees who are offered a bung is to accept it and then
deal with it once they are in the job. While I understand the pragmatic
reality of that position, for somebody who is applying for a job to be
told, If your employer is trying to do something dodgy here,
the best thing is to get into the job, trouser the cash and then get
your pension rights, there is something about that solution
that leaves me feeling uneasy. I wonder whether some wording regarding
whether pensions rights should be discussed at an interview stage could
be brought into the Bill. It would fall short of an employment right,
but would still perhaps act as a disincentive to a breach of law
occurring if employers went down that
route.
Mr.
O'Brien: I am not sure the suggestion the hon. Gentleman
makes, which is that pension issues cannot be discussed in initial
discussions, would fall short of a pre-employment right. We therefore
need to approach this with some caution. He is right that we are
adopting a course which is inelegant and is perhaps not ideal. We all
know that we would rather take the course of action that he suggests in
general terms, but the breach of the broad principle that there are no
pre-employment rights is regarded by employers as an enormously
important onemainly because it could lead to a lot of other
demands. There is a view in industrial relations circles that there is
essentially a balance between employers and trade unions and employees
that needs to be very carefully maintained. While this particular
change might not, of itself, damage that balance, other things might
then flow from it and that balance might be undermined.
It is a tricky
situation and I understand why the hon. Gentleman feels uncomfortable
with the position. But it is one that we have negotiated and it is, in
a sense, part of what we have talked about in the pasta
consensus whereby we have got the employers on board to support this. A
number of compromises have been madethe TUC, for example,
wanted to bring employment rights and they have accepted that this
compromise, although not what they wanted, is one with which they can
live.
Miss Julie
Kirkbride (Bromsgrove) (Con): While all of us have every sympathy with what
the hon. Member for Inverness, Nairn, Badenoch and Strathspey is
saying, it would not always be the case in terms of discussing the
prospect of employment that the prospective employee would not want to
discuss pensions. There will be some situations where a pension will be
part of a whole package of measures making up that persons
employment. Therefore it would not be an advisable road to go down to
say that there is no discussion of these things in advance of being
offered a contract.
Mr.
O'Brien: That is an entirely fair point. Indeed, in some
employment situations, the pensions package is a big part of the
negotiation. At the same time and in defence of the hon. Member for
Inverness, Nairn, Badenoch and Strathspey, he is suggesting not so much
that the pension should not be discussed, but that an offer of
employment cannot be conditional upon an employee saying that he will
not take a pension, which is a slightly different point.
While I understand the hon.
Gentlemans point, and I have some sympathy with it, for the
reasons I have given, we are probably best preserving the consensus
with the employer on this point and accepting that it is a part of the
overall agreement which has enabled broad-based support to be given to
the Bill.
Amendment agreed
to. Clause 49,
as amended, ordered to stand part of the Bill.
Further consideration
adjourned.[Mr.
David.] Adjourned
accordingly at twenty-four minutes past Ten oclock till this
day at One
oclock.
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