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Baroness Turner of Camden: I thank the Minister for that explanation. I am glad to learn that a review is proceeding and, presumably, we shall not have to wait too long for the result. I note what he says in relation to the directive; that is, that the UK can choose its own definition provided it is defensible. I wish to think about that before we reach Report stage to see whether there is some aspect or other that we should still pursue on Report. In the meantime I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 225 to 230 not moved.]
Baroness Miller of Hendon moved Amendment No. 231:
- Page 49, line 33, at end insert—
The noble Baroness said: In moving Amendment No. 231, I wish also to speak to Amendment No. 237. They are both identical and relate to the powers of the Secretary of State to make regulations relating to
Subsection (4) to both Clauses 45 and 46 begins with the preamble,
In our dealings across the Dispatch Box and outside the Chamber the Minister has always done his best to be frank and open with me. That, however, I do not believe is characteristic of this Government as a whole. However, in the Explanatory Notes, in an uncharacteristic outburst of candour, the Government say,
That aspiration is directly in contradiction to the phrase in both Clauses 45(4) and 46(4) which I read earlier,
It is bad enough that the directives of the EC frequently tend to be over-prescriptive, a phrase which the Government often use about the amendments that I propose. It is bad enough that the accumulative effect of these directives is to make the EU increasingly uncompetitive with the rest of the world, and is helping to fuel the unemployment in Germany and elsewhere. However, our Government, who when they were in Opposition described our thriving bureaucracy and strike-free economy as "the sweat shop of Europe", are now rushing headlong into pushing us down the competitive ladder. Anything that Brussels can do, Whitehall can do better.
Elsewhere in the Bill, I am proposing an amendment which will ensure that with a minimum of regulation, the objective of ensuring fair play for fixed-term employees is achieved. That is all that is needed.
The amendment to the two clauses simply ensures that the Government adhere to the EU guidelines, just like our European competitors, and do not go beyond them, because we are not obliged to do so. I beg to move.
Lord Sainsbury of Turville: I should like to speak to Amendments Nos. 231 and 237. Amendment No. 237 is the same as Amendment No. 231, except that it applies to Clause 46 which enables fixed-term regulations to be made in Northern Ireland. The same arguments against Amendment No. 231 apply to Amendment No. 237.
The amendment would prevent the regulations under Clause 45 from imposing any obligations beyond those required by the EC fixed-term work directive. The amendment would therefore mean that the regulations made under the clause would allow employers to pay their fixed-term employees less than their permanent staff and give them less favourable pension rights just because they were on fixed-term contracts.
In our view, the fixed-term directive does not require us—and we have made that clear—to prevent pay and pensions discrimination against fixed-term employees. However, following a full public consultation last year on the implementation of the directive, we have evidence of pay disparities between fixed-term and permanent employees that I believe justifies taking power to do this.
Other EU member states have already stopped or are expected soon to stop pay discrimination against fixed-term employees. We do not know of any member states which intend to exclude pay from the non-discrimination requirements of their legislation when transposing the directive. We do not see why British fixed-term employees should be treated as second class. There is therefore no case here for saying that this will make British industry uncompetitive against other EU countries.
When we come to implement the fixed term work directive, we intend, in light of the evidence of pay and pensions discrimination against fixed-term employees we received in the fixed-term public consultation, to prevent pay and pensions discrimination as well.
When transposing the part-time work directive, we also decided to cover pay and pensions, despite our view that this was not a requirement of the directive. Fixed-term employees are in a similar position to part-time ones in that they work for the same employer as comparable, permanent or full-time employees, but have a different contractual arrangement. By making fixed-term work pay, we shall make this flexible form of work attractive to work seekers. Fixed-term employees have an important part to play in our labour market and they are entitled to a fair deal.
Preventing pay and pensions discrimination will protect about 1.2 million fixed-term employees in Britain. Many employers do not discriminate against their fixed-term employees unless they have sound, objective reasons for doing so. Requiring equal treatment will help prevent these "good practice" employers from being undercut by unscrupulous competitors.
Identifying the exact requirements of a directive is not always a simple matter. It would be difficult for the Government to transpose many directives, including this one, as precisely as this amendment requires, because of the degree of uncertainty that exists as to how they should be interpreted. The noble Baroness's amendment would force the Government to simply "copy out" the directive, so leaving businesses to interpret its requirements. This would transfer the risks of incorrect interpretation on to employers. The
I hope that this explanation of our thinking and of the likely intentions of our European partners is informative and reassures the noble Baroness that we are not placing British business at a competitive disadvantage to other companies in Europe. When the time comes, she and her noble friends will have the opportunity to debate the regulations that we lay. I would ask her to withdraw these amendments.
Lord Lea of Crondall: Perhaps I may raise one point which has not been dealt with sufficiently. This is one of a series of directives which derives from the social partners agreement and the Social Chapter, which the party opposite may not be as enthusiastic about as some. However, it is a procedure whereby ETUC—the British affiliates are the TUC and the CBI—are party to a framework agreement. The framework agreements are generally quite short and are in extremely sharp contrast to, for example, the working time directive.
One cannot have it both ways on an issue such as this. If one wants something that is negotiated, with that degree of extra commitment from the TUC and the CBI—the CBI would totally endorse what I am saying about this—one has a framework agreement because one can live with it. However, that raises the interesting question of more difficulty or flexibility of transpositional interpretation. One cannot have it both ways.
I hope that on due reflection at some stage, the noble Baroness, Lady Miller, will appreciate that bringing atypical workers—"atypical" is the word used for part-time, fixed-term, agency workers and so on—into more normal employment relationships, which over time will include pensions, training and so on, means that those workers, the flexible workforce of the future, will be accepted as part of the normal economy. In fact, it is not the case that we are losing our competitive position with the United States on this or other matters. Looking at the productivity per hour, one sees that many European countries have caught up with and are ahead of the United States. They have shorter holidays, they work like dogs and they have a higher gross product. But that is a trade-off between leisure and individual income.
The fact is that we in Europe are now able to give some status to all those workers, which has been a phenomenon in Europe more than in the United States in the past 10 years. That is why the flexible employment relationship, much vaunted in the future, will be underpinned by this range of framework directives.
"( ) No regulation made by the Secretary of State under subsection (4) shall exceed the requirements of Directive 99/70/EC or any amendment, modification or re-enactment thereof for the time being in force."
"for the purpose of implementing Council Directive 99/70/EC".
"the Government takes the view that, on account of its legal base, this directive does not apply to pay and pensions . . . and the Government intends to prevent pay and pensions discrimination against fixed term employees, in addition to implementing directive 1999/70/EC".
I repeat the words,
"in addition to implementing [the] directive".
"for the purpose of implementing Council Directive 99/70/EC".
The powers that the Government are seeking to make future regulations would enable them to go beyond—far beyond—what the directive requires. This is a classic example of something about which we have frequently complained; that is, the habit of the Government of gold-plating EC directives.
7.15 p.m.
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