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Lord Wedderburn of Charlton moved Amendment No. 70:

"( ) An employer shall not present a notice of appearance to an employment tribunal under a jurisdiction to which this section applies if—
(a) it concerns a matter in relation to which the requirement in paragraph 7(1) or 10 of Schedule 2 applies, and
(b) the requirement has not been complied with."

The noble Lord said: My Lords, having discussed Clauses 31 and 38, we now come to Clause 32. This is at the core and centre of the apparatus introduced

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concerning the procedures dealt with in Schedule 2. This clause is concerned, as we saw in Grand Committee, with the limitations on access to justice in the tribunals.

We had a rather unsatisfactory debate on a similar amendment in Grand Committee. That was partly because our amendment was too widely drawn. We have corrected that in order to aim at what I take to be an agreed central objective. In the regulations for employment tribunals in 2001, a new overriding principle was introduced in Rule 10. The rule states:

    "The overriding objective of the Rules in Schedules 1, 2, 3, 4, 5 and 6"—

which are the relevant rules on employment tribunals—

    "is to enable tribunals to deal with cases justly".

In dealing with cases justly—as those familiar with seminars on jurisprudence will perhaps accept—dealing with equal situations equally, and being even-handed, is a fundamental manner of approaching a just administration.

Under subsections (2), (3) and (4) of Clause 32 the employee is obliged to take the first step under the grievance procedure if he is to be allowed admissibility to the tribunal. I deal with his wish to go to the tribunal—which is how "access to justice" is defined. In the debate in Grand Committee all kinds of problems were introduced—for example, that he might have a second chance to go. But principles on access to justice, as the discussions of the European convention make very clear, are not concerned with second chances; they are concerned with primary access to justice. Under Clause 32(2), the employee is prohibited, as I put it, from presenting his complaint to the employment tribunal. Government Ministers tend to say that he will find that his complaint is not admissible to the employment tribunal if,

    "it concerns a matter in relation to which the requirement in paragraph 6 or 9 of Schedule 2 applies, and . . . the requirement has not been complied with".

So, if he has not complied with the first step under the grievance procedure, he cannot go to the tribunal.

This amendment applies a rule to the employer which is as even-handed as that which is applied to the employee. If the employer has not complied with his first step in the grievance procedure, the amendment would say that he is not permitted to enter a notice of appearance, which in general terms would mean that he is under a precisely parallel limitation to justice as that applied to the employee. If he has not complied with the first steps that he is obliged to take before inviting the employee to a meeting and, in the modified procedure, setting out his written response—the amendment would say that he is under precisely the same sanction as the employee who has failed in precisely the same way. It is a breach of the statute, and it is a breach of his contractual obligations by reason of the provisions of Clause 30.

If the Government really mean to be even-handed and to promote their own objectives, they must say something to the employer who fails in his obligations in a precisely parallel way to that in which the

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employee is spoken to when he fails to undertake his first obligation in the statutory procedures under Schedule 2. Without such a provision, there is no substance in the Government's claim that the provisions of Schedule 2 will promote dialogue and settlement at the place of work.

The employee must take his first steps, or he cannot go to the tribunal. Even if he does take the first steps his case is held up for 28 days. We have not included the second point, only the first. This is a most modest proposal; namely, that when the employer fails to take the first steps that he should take under his statutory and contractual obligations, he should be under precisely parallel sanctions to those on the employee. In that way, he would be encouraged to get on with the procedure, to do what he ought to do. He would have a sanction against him if he did not do that. At the moment, he has absolutely none so far as concerns access to justice—presumably only the remedy of the employee, who can sue him for breach of contract. But the Government wish not to encourage litigation, so they could introduce an automatic penalty, just as they have done for the employer. I beg to move.

7 p.m.

Lord Falconer of Thoroton: My Lords, as my noble friend Lord Wedderburn pointed out, the admissibility regime in Clause 32 relates directly to employees. Where it applies, the regime ensures that the employees must at least initiate the statutory grievance procedure, and then wait 28 days before applying to a tribunal. My noble friend's amendment seeks to establish a parallel set of obligations on employers. In order to defend an application at a tribunal, the amendment would impose a requirement on employers to take certain acts under the grievance procedures.

We debated a similar amendment in Grand Committee on 25th March. On that occasion, as my noble friend acknowledges, amendments were tabled that sought to require employers to complete all their obligations under the procedures as a pre-condition for defending cases at a tribunal. This latest amendment pares down that obligation to some extent; for example, under the standard grievance procedure, the pre-condition is limited to the obligation on the employer to invite the employee to a meeting.

The idea as advanced by my noble friend Lord Wedderburn is to establish, as he would put it, an "even-handed" system. I believe that we have already done so. If one looks at Part 3 of the Bill in its entirety, it will be seen that Clauses 31 and 34 provide clear incentives to employers to use the procedures. If they do not, increased awards will be made against them, and there will be automatic findings of unfair dismissal. Clauses 31 and 32 provide the corresponding incentives to employees—reduced awards and a procedural bar to bringing proceedings, until the procedure is satisfied. That is the parallel incentive and disincentive, depending on which way one looks at it.

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Therefore, when considering the Bill overall, we can see that obligations are placed upon both parties. It would seriously imbalance the position if fresh obligations were placed on employers under Clause 32, as proposed in my noble friend's amendment. On that basis, we are unable to accept the amendment. It would upset the balance of the Bill and unnecessarily restrict the ability of employers to defend themselves at tribunals. In the light of my explanation, I hope that my noble friend will feel able to withdraw his amendment.

Lord Wedderburn of Charlton: My Lords, I am grateful to my noble and learned friend for his response. It proves that the Law Society was right in its view; namely, that Clause 32 (formerly Clause 33) should be struck out of the Bill. The Law Society says that Clause 31 is sufficient. The answer to this amendment from my noble and learned friend is to advise us to look at Clause 31. Very well, he is absolutely right to point out that Clause 31 imposes sanctions on both sides—that is, on employees and on employers. Indeed, that is the sanction under the clause where the tribunal exercises it various powers and discretions to increase or decrease awards, and it applies to both sides.

The trouble with Clause 32 is that there is a sanction on workers but no sanction on employers. I hear someone muttering a reference to Clause 34. We shall deal with that clause later, although I am not sure at what time of night. My noble and learned friend need have no fear. We shall deal with that clause, which is even worse. Clause 34 will reverse a fundamental principle of procedural justice. Therefore, to rely on Clause 34 to justify Clause 32 when you have Clause 31, which the Law Society says is totally adequate for the Government's objectives, is most extraordinary.

My noble and learned friend does not take account of a very simple point. We all like to appear to be reasonable and not mention unfortunate possibilities. However, I have to tell my noble and learned friend that among working people and their representatives, especially recently, there is a belief that the Government have given in to the pressure of employers' organisations to make the procedures under Schedule 2 and Clause 32 unfair to working people. The imposition of a sanction upon workers under Clause 32 with no corresponding sanction upon employers when the Law Society has said that Clause 31 is adequate, coupled with the response by my noble and learned friend to the case that I put forward in which he cited Clause 31 as a justification, will give them good reason to conclude that that pressure has succeeded.

Before Third Reading, the Government must come forward with a further provision in relation to Schedule 2 and Clause 32 that will somehow make fairer the standard of modified procedures; otherwise, when the first cases reach the tribunals and the courts and this unfortunate set of principles applied to workers in Parts 2 and 3 of the Bill comes to light, the Government will have to face an explosion of wrath because that will be seen as the price for gaining

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acceptance by employers' organisations of union learning representatives and increased maternity and family rights.

It just will not do to tell me that no sanction can be placed upon employers in Clause 32, simply because equal sanctions are placed on workers and employers in Clause 31. However, there is not much that we can do about the situation. The Bill was sent upstairs to a Grand Committee; it received little notice; and it is now being pushed through in an extraordinary Report stage. All we can do is ask the Government to put aside the pressures that have been placed upon them. They must reconsider the way in which Clause 32 operates before we reach Third Reading. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

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