1 Introduction
Background
1. Blacklisting is the practice of systematically
denying individuals employment on the basis of information, accurate
or not, held in some kind of database. The Economic League, an
organisation founded in 1919 to combat what its members saw as
subversion, communism and opposition to free enterprise, was caught
blacklisting in the 1980s.[1]
This led to media attention and an inquiry by the then Employment
Committee of the House of Commons.[2]
Subsequently, both the accuracy of the information held by the
Economic League and the use to which it was put came under intense
scrutiny, and the League was disbanded in 1993.
2. Within the Economic League there had been a section
dealing with construction, called the Support Group, and with
the closure of the Economic League this evolved into The Consulting
Association (TCA), under the leadership and guidance of Cullum
McAlpine of Sir Robert McAlpine and others. TCA provided a blacklisting
service, whereby companies could submit names and details of workers
they deemed to be unsuitable to a central list and to check prospective
employees against this list. In February 2009, TCA was raided
by the Information Commissioner's Office (ICO), which found evidence
of offences related to breach of data protection laws, prohibited
under the Data Protection Act 1998 and the Trade Union and Labour
Relations (Consolidation) Act 1992.
3. The Employment Relations Act 1999 had made provisions
for regulations on blacklisting to be introduced. Following the
raid on TCA and consultation, these regulations were introduced
in the Employment Relations Act 1999 (Blacklists) 2010. This prohibited
any person from compiling, using, selling or supplying a "prohibited
list". A "prohibited list" is defined as one that
"contains details of persons who are or have been members
of trade unions or persons who are taking part or have taken part
in the activities of trade unions" and which "is compiled
with a view to being used by employers or employment agencies
for the purposes of discrimination in relation to recruitment
or in relation to the treatment of workers".[3]
Our inquiry
4. In April 2011, we launched our inquiries into
Health and Safety in Scotland.[4]
During the course of those inquiries, we heard accusations that
workers who raised health and safety concerns, especially in the
construction industry, were labelled as 'troublemakers' and likely
to be denied further employment. This, added to the fact that
the rate of fatal accidents in the workplace is higher in Scotland
than in the rest of the UK, gave us significant cause for concern.[5]
Accordingly, we decided to launch a separate inquiry into the
issue of blacklisting in employment, particularly in the construction
industry.
5. We launched our inquiry into Blacklisting in Employment
on 27 June 2012, and published our first interim report on 16
April 2013.[6] That report
focused specifically on the work of TCA. We also discussed the
issue of compensation for those workers who had been blacklisted
and agreed to take more evidence on this topic.[7]
Since the publication of our report, significant progress has
been made in highlighting and addressing issues relating to blacklisting:
the ICO has launched its own investigation[8];
many victims of blacklisting are bringing individual case to the
High Court,[9] and a new
compensation scheme, The Construction Workers Compensation Scheme
(TCWCS), for blacklisted workers has been launched by eight of
the companies that used the services of TCA.[10]
While our previous report concentrated on historical incidences
of blacklisting, we remained unconvinced that the practice was
purely a historic one and we therefore continued to investigate
the issue. We called for further evidence on four key questions:
:
· Is blacklisting still taking place, both
within the construction industry and more widely, and especially
in Scotland?
· Who should qualify for compensation? Anyone
whose name appeared on a blacklist, or those who can prove that
they were adversely affected by blacklisting? Who should provide
that compensation?
· What penalties are appropriate for those
firms and individuals who engaged in blacklisting and who benefited
financially from the process, and is it appropriate to introduce
a degree of retrospection? In addition, should firms which have
been involved in blacklisted be prevented from tendering for public
sector contracts in future? Or should they only be allowed to
tender if they pay compensation?
· Is the existing legislation against blacklisting
sufficient, if properly enforced, or is a change to the law needed
to eradicate the practice?
6. The purpose of this second interim report is to
identify ways of moving forward, both by addressing the crimes
of the past and by identifying rules and structures to prevent
such widespread and systematic exclusion of workers from employment
from ever happening again. It focuses on two key areas: first,
we consider the historical practice of blacklisting and assess
how those who have participated in this practice should make amends
for what they have done, and how victims of blacklisting should
be compensated. Second, we set out examples of best practice both
in the public and private sectors in attempting to eradicate blacklisting
in the construction industry once and for all. In conclusion,
we briefly raise the question of whether legislative reform or
new legislation is required to eradicate blacklisting, which will
be the focus of the next phase of our inquiry.
7. We are grateful to all the witnesses who have
appeared before the Committee in the course of this inquiry, and
to those who have submitted written evidence. A full list of witnesses
is Annexed to this report. We also thank the National Assembly
for Wales for their welcome to the Senedd, Cardiff Bay, and for
allowing us to make use of their facilities to hold a formal evidence
session with the Welsh Government and a number of informal meetings
in connection with this inquiry.
1 http://www.publications.parliament.uk/pa/cm201213/cmselect/cmscotaf/1071/1071.pdf,
p 5 Back
2
ibid. Back
3
http://www.legislation.gov.uk/uksi/2010/493/crossheading/general-prohibition/made
Back
4
http://www.parliament.uk/business/committees/committees-a-z/commons-select/scottish-affairs-committee/news/hse-terms-of-reference/
Back
5
http://www.publications.parliament.uk/pa/cm201213/cmselect/cmscotaf/1071/1071.pdf Back
6
http://www.publications.parliament.uk/pa/cm201213/cmselect/cmscotaf/1071/107102.htm
Back
7
http://www.publications.parliament.uk/pa/cm201213/cmselect/cmscotaf/1071/1071.pdf,
p.24 Back
8
http://ico.org.uk/for_the_public/topic_specific_guides/construction_blacklist Back
9
http://www.building.co.uk/blacklisting-high-court-cases-put-back-to-spring/5064382.article Back
10
See the next chapter of this report for further details. Back
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