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Lord Monson: Before the noble Lord sits down, I wonder whether I might try to help solve the puzzlement which he refers to. It has been established statistically that good-looking people, be they male or female, have much better employment prospects and have much higher lifetime salaries than those who are physically less favoured. This is a fact, established, I understand, both in the United States and in this country. I suspect that that is probably one of the discriminatory aspects which the noble Lord, Lord Razzall, had in mind.

Lord Razzall: That is undoubtedly the case, as everybody looking around this Chamber would testify. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 14 agreed to.

Schedule 5 [Unfair Dismissal of Striking Workers]:

[Amendment No. 274 not moved.]

Lord Wedderburn of Charlton moved Amendment No. 275:

Page 73, line 40, at end insert--
("( ) It shall be for the employer to prove that the dismissal is not unfair by virtue of the reasons set out in subsection (4), (5) or (6).").

The noble Lord said: There are various ways of protecting workers against dismissal. There is of course no more serious fate that can overcome someone than to be improperly dismissed. Two of those ways may be said to be the following. The first concerns a law which permits the employer to dismiss an employee by reason of the employee taking industrial action. The Committee will remember that we had some discussion about the nature of different forms of industrial action on an earlier amendment. I mentioned dismissal where the worker is taking part in industrial action as being a further area which needed definition and consideration.

In the area of dismissal for industrial action a legal system may look at it by saying that the employer may dismiss an employee by reason of the activity of the employee, either for industrial action generally or in some cases for out-and-out strike action, or a mixture of these. That I would call the subjective procedure. Alternatively, there is the objective procedure where an employee may be dismissed at the time of taking industrial action. Curiously enough, our system, looked at as a whole, has permitted the employer to dismiss, or rather to find that the industrial tribunal, or the employment tribunal as I must now call it, has no

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jurisdiction in the matter if the employee is dismissed at the time of the industrial action, where he is one of a minority, or not the whole number, with his colleagues, in taking the action.

There is a case for an objective test; that is to say, where the employee is taking industrial action at the time the employer is found to commit a wrong or, in our system, to make an unfair dismissal. I would point out that despite the increase in the limits of the compensation that can be claimed, this is not a very strong remedy. The remedy, other than a very large amount of compensation, does not usually compare with the loss of the job where the unfair dismissal has occurred.

Many commentators have argued that the subjective test produces great difficulty for the employee. This is not a case which can be compared with dismissal for maternity or pregnancy reasons, and so on. I make no attempt at trying to compare those dismissal grounds. But where a dismissal has taken place and the test is whether or not the employer can be shown to have dismissed an employee by reason of participation in industrial action, the employee is in very great difficulty. The cases which illustrate the situation very clearly--for once, I shall not cite them to your Lordships--are those in which it is alleged that the employer has dismissed the employee by reason of participation in trade union matters. That would be much improved by this Bill.

However, in the cases that have occurred, until now it has been shown to be difficult for the employee to know what the employer's reason is. Therefore the objective test, whether or not the employer has dismissed the employee during the course of industrial action, in participation of which the complainant stands, is one which is simpler. In effect it puts a very heavy burden on the employer. Nevertheless it can be found in a number of western European systems.

Weighing the matter in the way I have described, my noble friends and I felt that it would be absurd to seek to shift from the subjective system to the objective system. Goodness knows what agreements and deals that would cause to be upset. Also, it would hardly be a sensible amendment to the Bill because the Bill is based upon the subjective system: where the employer dismisses by reason of the industrial action. I shall not read to the Committee the remainder of the section. That is the nub of the matter. We did not think it right to move amendments to change that.

However, we believe that we should find a reasonable balance between the two systems. I assert that industrial action is a right of workers provided they go through the necessary procedures. But, given that, a half-way balance should be found. That half-way balance would be to put the burden of proof on the employer that the dismissal was not unfair in terms of sub-paragraphs (4), (5) and (6). Sub-paragraph (4) applies to the first eight weeks. It would not be that onerous a proof. But if he wishes to prove that the dismissal was not by virtue of industrial action taken by the employee, he can prove that. The employer will have all the facts within his knowledge.

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I do not whether I am attracting the support of the noble Baroness, Lady Miller of Hendon. I do not aim my argument at her. She will have considered whether she supports the amendment. As usual, I aim my rather slender argument at my noble friends on the Front Bench. What is the argument for not putting the burden of proof on the employer? It is a half-way house system. If the employer is clear that he has not dismissed by reason of industrial action, why will he not give evidence to show that? That is easy for him; it is not difficult. It is difficult for the employee who is dismissed to do so.

The strength of my argument to my noble friends on the Front Bench is that the burden of proving the reason for his action is put upon he who should prove the matter. If the employer cannot do that, it is clear that the employee should be able to convince the employment tribunal of the first part of his case.

I hope that my noble friends on the Front Bench-- I say this in comradely friendship--will not simply read me a transcript which was organised before my argument was put. I see my noble friend looks confident that his transcript will meet the arguments I have put forward. There is a case here. The provision will stop injustice to employees who have been dismissed during the course of industrial action, or afterwards by victimisation. The employer will be guilty of unfair dismissal only when he cannot show clearly on the burden of proof that that was not the reason for his action. I beg to move.

7.15 p.m.

Lord McIntosh of Haringey: My noble friend has given me a difficult task. He has told me that I cannot read my speaking notes. However, he has helped by saying that his arguments are slender. I shall have to steer a path between those as best I can.

This is the first amendment to be debated on Schedule 5. I think that it is necessary to remind the Committee that the proposed amendment refers to dismissal after the period of eight weeks into industrial action. The Bill provides that dismissal within the first eight weeks of industrial action is automatically unfair dismissal. Therefore we must consider the situation after eight weeks in that light.

Our proposals give employees the right to claim unfair dismissal if they are dismissed after the first eight weeks of industrial action and the employer has failed to take reasonable procedural steps to resolve the dispute.

As with most unfair dismissal claims the tribunal will be asked to determine whether in the circumstances the employer acted reasonably. In his amendment my noble friend seeks to place the burden of proof on employers to show that the dismissal of strikers is fair if taking place after the first eight weeks. It will be the responsibility of the tribunal to make the finding having heard all the evidence and having considered all the circumstances. The amendment seeks to place the burden of proof on the employer. But--I believe that this is the crux of the matter for my noble friend--the way in which the Bill has been drafted means that the new Section 238A will be construed as one with Part X

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of the Employment Rights Act, including Section 98 which places the burden on the employer to show the reason for dismissal and that the reason was a permissible one. It will be for the tribunal to determine whether that reason was the true one and whether his action was reasonable. It will also be for the tribunal to decide whether the employer took all reasonable steps. The Government consider it unnecessary and inappropriate to make special provision for these purposes.

In assessing whether employers have taken sufficient action to resolve a dispute, the tribunal will be asked to consider whether respect was shown for dispute procedures, whether reasonable steps were followed to reopen negotiations after the action began, and whether reasonable steps had been taken to involve ACAS or other third parties in helping to resolve the dispute through conciliation or mediation. The tribunals will be able to draw on direct hard evidence of the behaviour of the parties before reaching a decision. There should be relatively little difficulty for the tribunal to establish what steps have or have not taken place. What is more, the legislation has been drafted to ensure that the onus is placed on the behaviour of both parties. I am sure that noble Lords on both sides of the Committee will agree that that is the right approach. If dismissals are to be avoided, and clearly they should be the last resort, both sides must be encouraged to find a settlement. The legislation specifically states that tribunals must equally take into particular account whether the union has made or accepted overtures to resolve the dispute.

In view of the way in which this legislation is read in with the Employment Rights Act, I hope that my noble friend will not think it appropriate to press his amendment.

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