Documents considered by the Committee on 25 June 2014 - European Scrutiny Committee Contents


7 Company restructuring

Committee's assessment Politically important
Committee's decision Cleared from scrutiny
Document details Commission Communication: EU Quality Framework for anticipation of change and restructuring
Legal base
Department Business, Innovation and Skills

Summary and Committee's conclusions

7.1 The Commission Communication proposes a Quality Framework based on a broad set of principles drawn from a variety of national frameworks, industrial relations systems and social contexts which is intended to serve as "a source of inspiration and guidance" for all those involved in, or affected by, change and restructuring. The Framework has no binding effect, but builds on existing EU Directives providing for information and consultation within the workplace and seeks to raise awareness of good practice in anticipating change and in managing restructuring in a socially responsible way. It is mainly aimed at larger companies and public sector employers, rather than SMEs whose capacity to implement it is likely to be limited. Member States are urged to support, disseminate and promote the Quality Framework as widely as possible and to consider applying its principles to all public sector employees. Social partners (trade unions and industry) are invited to build on the Framework by developing their own action plans to mitigate the impact of economic adaptation.

7.2 The Government considers that existing arrangements for informing and consulting employees are adequate and that the imposition of more formal requirements for businesses contemplating or implementing restructuring measures would be challenging in the current economic climate. As the Quality Framework proposed by the Commission takes the form of a non-legislative instrument without binding effect, the Minister for Employment Relations and Consumer Affairs (Jenny Willott) indicated that its policy implications for the UK were likely to be limited. We agreed, but asked the Minister to explain whether the Government intended to "support, disseminate and promote" the Quality Framework, how it proposed to do so, and at what cost, and whether the principles it enshrines would be applied across all areas of public sector employment.

7.3 In this, our second Report on the Commission Communication, we set out the Minister's response.

7.4 We thank the Minister for her response which clarifies how the Government intends to apply the Quality Framework in the UK. We are now content to clear the Commission Communication from scrutiny.

Full details of the documents: Commission Communication: EU Quality Framework for anticipation of change and restructuring: (35686), 18151/13 + ADD 1, COM(13) 882.

Background

7.5 Our Thirty-sixth Report, agreed on 12 February 2014, provides an overview of the content of the Commission Communication and the main elements of the proposed Quality Framework on change and restructuring.

The Minister's letter of 17 June 2014

7.6 The Minister (Jenny Willott) tells us:

    "Since the QFR [Quality Framework on Restructuring] was published in December 2013, the Department for Business Innovation and Skills has been raising awareness of the framework with relevant stakeholders including social partners. We will continue to explore ways of raising awareness, including via digital engagement.

    Where appropriate and relevant, we will draw attention to the Quality Framework as a potential benchmark for parties to be aware of and consider. We will also consider the framework when developing new guidance on employment matters. These efforts will need to take account of the legal frameworks and regulation already in place."

7.7 The Minister adds that, in promoting the Quality Framework, the Government will seek to ensure that it is "compatible with existing UK national laws and our policy of a flexible, low burden approach". She notes that it builds on a general framework Directive establishing procedures for dialogue between social partners and for the consultation of employees in the event of major changes, such as collective redundancies. She continues:

    "Light touch minimum standards encourage both parties to engage in more co-operative conversations which can benefit both the workforce and the employer. As part of our on-going efforts to monitor compliance with this Directive and ensure the effectiveness of information and consultation practices in the UK, we plan to explore with stakeholders how the framework can be applied in practice, across the public and private sector. This will include engaging with public sector employers, including where they are currently exempt from the Information and Consultation Directives on which this framework is based."

7.8 The Minister anticipates that the Quality Framework will enable the Government to continue its "flexible and low burdensome approach" and should not give rise to any significant new costs for Government or other stakeholders.

Previous Committee Reports

Thirty-sixth Report HC 83-xxxiii (2013-14), chapter 4 (12 February 2014).


 
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