Blacklisting in Employment: addressing the crimes of the past; moving towards best practice - Scottish Affairs Committee Contents


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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