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Lord Borrie: My Lords, as there is a reasonable amount of time left at our disposal, perhaps I might intervene to refer the Minister to what Mr. McCartney said on 24th April. He said that the Government favoured the approach available currently for health and safety disclosure, making the point,

He goes on to refer to various people on quite high salaries and three times such a salary would be much higher than the limits mentioned by the noble and learned Lord.

Lord Fraser of Carmyllie: My Lords, I am grateful to the noble Lord, Lord Borrie, and thankful that I put in my earlier caveat that I was not entirely sure I had followed all the detail from the Bill. But even the quotation from Mr. McCartney seems to indicate that the damages to emerge in circumstances where there has been an order to re-employ and that order has been rejected--I doubt a tribunal would have invited Mr. Templeton to go back to his job and, if it had been offered, I doubt that he would have wished to take it--are limited.

My point is simply this. If serious scandals have to be addressed and serious issues arise for senior managers to consider when they decide whether or not they will go outwith the organisation and make appropriate complaint, we ought at least to examine in your Lordships' House whether the appropriate levels of damages are sufficient. Having made that observation and spelt out the areas it may be appropriate for us to examine in Committee, I repeat my congratulations on the noble Lord's introduction of the Bill.

8.15 p.m.

Lord Haskel: My Lords, first, I too congratulate and pay tribute to my noble friend Lord Borrie on taking forward this Bill. As my noble friends said, it deals with a subject of great importance to workers, employers and the public at large. I thank my noble friend Lord Borrie for explaining the Bill. Much valuable work has been and continues to be carried out by the charity, Public Concern at Work, a charity my noble friend was instrumental in establishing. I congratulate also my noble friend Lady Dean on the part she played in the charity.

The Government have given full support to this important Bill. It will provide a remedy in cases, we

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hope few in number, where a worker was victimised for quite properly raising concerns about wrongdoing. It is plainly right that such procedures should exist, as my noble friend's quotation from the committee amply demonstrated. He made the point that it will help to encourage a climate of openness in the workplace and reduce the likelihood that failures or malpractice will occur. It is clear from the public consultation on the Bill that it has widespread support from all sides. The consultation was thorough and was carried out largely by Public Concern at Work. It resulted in over 80 responses from a variety of organisations, including employer organisations such as the CBI, the Institute of Directors, individual trade unions as well as the TUC, lawyers and others.

The Bill aims to encourage good practice and ensure that problems are dealt with at the earliest opportunity, without public exposure except in extreme circumstances. The Government join the noble and learned Lord, Lord Fraser, in the hope that the Bill will have the positive effect of encouraging employers to follow best practice by introducing procedures--or using existing ones--which will make it easier for workers to inform their employers about their concerns.

This Bill is very much in keeping with the Government's aim of encouraging best practice throughout industry. The procedures that employers adopt may vary according to their needs. But the Government hope that employers will ensure that they are effective and help promote greater openness in the workplace. For example, they may build upon existing grievance procedures or it may be more appropriate to designate a senior manager, the company's lawyer or an auditor as the person with whom concerns should be raised.

My noble friend Lord McCarthy asked about alternatives to the employer. The Bill provides powers for the Secretary of State to prescribe people or bodies to whom workers can turn as an alternative to their employer. Once the Bill has completed its parliamentary passage, we would intend to bring forward an order covering suitable bodies such as the Health and Safety Executive, the Environment Agency, OFT, the DTI's Insolvency Service and others. However, the Bill also protects workers where it is appropriate for them to disclose information to someone other than their own employer or the designated regulator. That may happen where it is unreasonable to expect internal disclosure because the worker reasonably believed that he or she would be victimised or that information would be covered up if the employer were alerted. Alternatively the worker may have raised the matter internally but been ignored or the wrongdoing may be so exceptionally serious that it must be disclosed immediately rather than delaying to find out whether there was a relevant designated body. In such cases the worker will be protected only if he or she acts reasonably--which is carefully defined, as my noble friend Lord Borrie reminded us, in Clause 1, subsection 43G(3). There can therefore be no doubt about that.

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I should like to make clear that the Bill does not intend to increase the risk of employers being sued for breach of confidence. The courts apply a public interest test when considering whether to enforce a duty of confidentiality.

This Bill, in particular Clause 1 and proposed new Sections 43G and 43H, lays down a series of reasonable requirements which a worker must follow to attract protection. The way these provisions operate, and in particular the tests in new Section 43G which refer among other things to whether the disclosure breaches a duty of confidentiality, means that any disclosure protected under the Bill would be likely to be within the public interest test. As a result, the employer would not be liable for the worker's breach of confidence.

My noble friends Lady Dean, Lady Turner and Lord McCarthy asked about trade union officials. The Government hope that employers will work with employees and their representatives, including trade unions, to put in place appropriate procedures to enable internal disclosures to be made. It is possible that trade union representatives may be the appropriate people to whom disclosures will be made as part of these procedures. In those circumstances, a disclosure to a trade union official would be a protected disclosure. We would certainly encourage employers and workers to identify the most suitable procedure for their circumstances. However, where trade union representatives are not part of the internal disclosure procedure, a disclosure made to them would have to be considered under Section 43G. Provided that the disclosure met the test in that section, it would be regarded as a reasonable disclosure and thus protected.

My noble friend Lady Turner asked about the additional workload for employment tribunals. The Government believe in a partnership approach where the best companies recognise their employees as partners in the workplace. Our new agenda is providing minimum standards in the workplace to underline this approach and we are aiming to encourage a change in workplace culture where disputes are resolved in the workplace by employers, workers and their representatives working together. This Bill is part of that agenda and will encourage issues to be resolved internally without the need for recourse to tribunals. However, it is inevitable that there will be disputes which cannot be resolved in another way. The Government have taken action to relieve the burden on tribunals. I was glad to support the Employment Rights (Dispute Resolution) Act, introduced by my noble and learned friend Lord Archer of Sandwell, which gained Royal Assent on 8th April. That Act will improve and streamline tribunal procedures and promote alternative dispute resolution. It is an important measure to help tribunals cope with their potentially increasing workload. My noble friends Lord McCarthy, Lord Borrie and Lady Turner all contributed to improving the Bill as it passed through your Lordships' House.

The noble and learned Lord, Lord Fraser, and my noble friends Lady Turner and Lady Dean asked about the cap on the compensation of higher-paid employees. This is an employment rights measure. The Government consider it important that compensation should be in line

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with current remedies. We believe that there is scope for those to provide adequate compensation. Perhaps I may give the figures to the noble and learned Lord, Lord Fraser. Awards made under the Bill will attract special payments ranging from £17,400 to £47,600 if based on the health and safety model. However, as the noble and learned Lord mentioned, much higher awards are possible where a re-employment order is made but not complied with. Compensation in that case is based on 156 weeks' pay. Higher earners would therefore benefit. Someone earning £200,000 a year could receive £600,000.

Noble Lords have said that employees may not seek re-employment because that is not what they want. However, the provisions of the Bill would protect them from victimisation if they were reinstated. I suppose that my advice could be that they should seek re-employment, as my noble friend Lord Borrie suggested. As I said, tribunals are able to award considerably larger amounts where a re-employment order is not complied with. However, we share some of the concerns of noble Lords. My honourable friend the Minister of State said in another place that in the longer term we will wish to consider whether the limits and the arrangements for reviewing them work in the best way to meet our aims. So I hope that we will be able to satisfy the concerns of my noble friend Lady Dean's friend Harry Templeton.

My noble friend Lord McCarthy asked about a code of practice. The Bill does not include an order-making power for a statutory code of practice. However, we will be preparing guidance on the Bill which will help employers and workers to understand it. This will include the use that should be made of internal company procedures and the conditions attached to protection when disclosure is made to others.

The noble Lord, Lord Newby, asked why the Bill does not override the Official Secrets Act and other statutes. It is not the intention of the Bill to override statutory provisions which have been agreed by Parliament. They have particular intentions. If they were unjustified they would need to be changed for all purposes, not just those in the Bill. The noble Lord, Lord Newby, and the noble and learned Lord, Lord Fraser, asked about the position of the police. The police are office-holders, not employees, and are covered by their own separate regulatory regime. For that technical reason it is necessary for any changes to be made by the Home Office under its regulations. The important point though is that the Government have agreed that the police should be covered by similar protection. It is a secondary matter how that will be achieved.

The noble and learned Lord, Lord Fraser, asked about the security services. All people who work for the security and intelligence services, including contract workers--cleaners, drivers and so on--are subject to security vetting. That is potentially because they have access to sensitive material. Such staff are more of a risk in not appreciating the implications of information they may disclose. The security and intelligence agencies use contractual clauses to restrict disclosures. This is more specific than general powers conferred by

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the Official Secrets Act. Clause 1, new Section 43J, of the Bill, however, would prevent such contractual clauses--hence the exclusion.

I think I have responded to all the points raised in the debate. We believe that the protection in the Bill for conscientious workers is long overdue. I therefore join my noble friend Lord Borrie in commending the measure to the House.

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