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Lord Wedderburn of Charlton: I am delighted to hear what my noble and learned friend says and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 155 not moved.]
Lord Wedderburn of Charlton moved Amendment No. 156:
- Page 38, line 15, at end insert—
The noble Lord said: It could just be that the Government's reply to Amendment No. 156 is that it is not necessary. But it is. It says that the section, which is still Section 33, is not to affect,
The matter arises because in Clause 30, the Government chose—for reasons which they have not yet explained in legal terms—to make the statutory procedures and the requirement to observe them, an implied term of every contract of employment. That structure therefore impacts upon two quite different jurisdictions. Obviously, the place in which a breach of the contract of employment is remedied is the ordinary court, county court or High Court. Until a few years
The Bill, therefore, in making the obligation to observe the statutory procedures in Schedule 2 a contractual obligation—or, as some have analysed it, a contractual as well as statutory obligation—impacts upon both jurisdictions. It is this question of the double jurisdiction which makes it necessary to be absolutely clear that nothing in Clause 33 can possibly prejudice the position of the employee in the jurisdiction of the ordinary courts based on common law for breach of contract of employment.
It may be that the Government do not want to make that clear because in doing so one also makes clear that the employee who can afford it, or who has the opportunity, might be better advised to go into the county court rather than into what was supposed to be the cheap and easy access to remedy employment injustices; the employment tribunal. So we might confirm, merely, that there will be an increase in common law actions in the ordinary courts. However, surely the intention is not that there should be an increase in litigation, but that if there be litigation it is open to the employee to go to the ordinary courts, untrammelled by the conditions of Clause 33.
It would be expected of me to add the comment that it is fairly rare for modern employment protection legislation to make the obligations of the parties into implied contract of employment terms. It was done in the Equal Pay Act 1970 and it arises under the National Minimum Wage Act 1998, Section 17. It can also be said to arise under the Trade Union and Labour Relations (Consolidation) Act 1992, Section 185. However, in those cases, clear rights are being set out and, for various policy reasons, implied into the contract of employment.
In this case there are rights and obligations which are not at all clear. Indeed, every time we probe them we are told that we will understand them only after we have seen a whole flurry of regulations. So this is a very strange and uncertain case. The regulations could say something that might affect the county court or High Court case. If the Government are so sure about their drafting of the regulations, they would no doubt say that will not be so. But why not give a guarantee that it will not be so? The only guarantee to be given is in the Act itself—here the Bill itself—which this amendment seeks to make plain.
There is another point which is of importance in regard to this amendment, and it is this. Because the statutory procedures will be part of the contract of employment, and when they are not fulfilled there will be a breach of the contract of employment, the common law courts—or the appellate courts generally—may have to reconsider recent case law, and it is no doubt that the Government have given some thought to that consequence.
Let me put it this way. The implied term which the Act will require—namely, that the parties act properly under the statutory procedures, in particular in regard to discipline as well as grievances—mean that for the law generally the employer is being required to deal properly and adequately with grievances and also to act properly in regard to dismissal. It may be that the Government took the course of implying that, as an obligation in the contract of employment, because of the recent cases of Goold (Pearmak) v McConnell [1995] IRLR 516 and Waltons & Morse v Dorrington [1997] IRLR 588, which is no doubt known to the Minister.
In both those cases, the EAT, particularly Mr Justice Morison, held that as a matter of common law the contract of employment had within it the implied term,
If that is the reason why the Government have included the statutory procedures as implied terms in the contract of employment, then, in my submission, it follows that the employer is under an obligation to act properly in a general sense with regard to dismissal. The power of dismissal must be moderated within the confines of the procedures; so, too, must the power and duty to have regard to grievances.
Many commentators already take the view, and I suspect will soon give vent to their views in print, that this will require your Lordships' Judicial Committee to reconsider the decision in Johnson v Unysis [2001], House of Lords ICR 480. In Johnson v Unysis a decision was made by your Lordships' Judicial Committee that—if I may express it in this way—one cannot complain of a procedural or abusive dismissal as a breach of contract by reason of the way in which it was conducted. The statutory procedure, as an implied term in the contract of employment, introduces precisely the opposite concept—that is, that one can complain where it is not conducted properly and one can complain where grievances are not conducted properly.
Therefore, it is an implication into the law of contract of the most profound kind which, one suspects, has never been thought through properly by those who have drawn up the Bill because no one anywhere has ever explained in Routes to Resolution, in the background document, in the responses to consultation, in the Committee in another place or anywhere else why they took the very interesting and profoundly important view that this should be implied in the contract of employment. It is a matter of great importance for the law generally to reaffirm and make clear on the face of the Bill that nothing in Clause 33 affects the common law jurisdiction with regard to
Lord McIntosh of Haringey: The amendment before us is relatively limited and I can deal with it fairly straightforwardly. The issues which my noble friend Lord Wedderburn raises about the nature of contracts of employment and the common law, and the examples which he gives, with which, as he knows, I am deeply familiar—he did not rise to that—in particular, with regard to the relationship between Clauses 30 and 33, are of very much wider significance. I do not wish to comment on them off-the-cuff but I want to think about them between now and Report stage. This might be an issue on which he would be willing to meet with and talk to officials and Ministers between now and Report.
Lord Wedderburn of Charlton: I should be delighted to do so if my noble friend would accept that Part 3 of the Bill should be withdrawn.
Lord McIntosh of Haringey: My offer was not made on that basis. Having said that, and having been as helpful as I believe it is appropriate for me to be, I can be more specific about the amendment. The amendment deals with the ability of an employee to complain to a court that there has been a breach of contract. Under general legal principles, a person who can bring the same claim in two legal forums has to choose which he will use. That applies to an employee who can bring certain claims both in an employment tribunal and in the ordinary courts just as it does to anyone else. If they bring proceedings in the one case, it is accepted that they cannot bring proceedings in the other. The purpose of that is to avoid duplication of claims.
I cannot see that Section 33 interferes with that position. Indeed, unless it specifically sought to interfere with that position, I do not think it could. If an employee makes an admissible application to the tribunal, the tribunal would accept it and the person would lose his ability to make the same claim in the ordinary courts. Clause 33 does not change that position in any other way—it simply adds to the reasons why a claim may be inadmissible before a tribunal, which is not the subject of this amendment. If a person made an inadmissible application to the tribunal, the tribunal would not accept it. In those cases, I can confirm that the individual is free to go to the courts or to make a second, admissible application to the tribunal. His options are protected.
"(6E) This section shall not affect the right of an employee to present to a court a complaint concerning a breach of his contract of employment, or the conduct or outcome of such proceedings."
"the right of an employee to present to a court a complaint concerning a breach of his contract of employment, or the conduct or outcome of such proceedings".
"that employers will reasonably and promptly afford a reasonable opportunity to their employees to obtain redress of any grievance".
The requirement that they state grievance procedures in the Employment Rights Act, as it now is, was held to support the view that it was a contractual obligation to provide procedures for grievances—a point much overlooked by many small employers.
6.15 p.m.
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