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Lord Campbell of Alloway: I seek some clarification on this. Is it right that all the clause does is to allow the union to apply to the CAC to appoint an independent person to handle these communications? Can a union not do that already? Is there anything to stop it? I am looking at the draft Bill. Is there anything to stop a union asking the CAC to appoint an independent person to handle communications? So far as I am aware, there is not. So, what is all this about? What is the necessity for this? Is it to fit it into some new form of rigid statutory procedure? If that is the object, it seems a fairly futile one.

Lord Triesman: I do not think that it is a futile object. Several balancing objectives are in mind. I shall not go over them all again, but it seems to me that they are very important to the central thinking.

First, this is the part of the procedure where the employer is required to take part. Before the employer is required to take part, everyone should know the ground rules on which they are taking part. Otherwise at some stage there inevitably would be people who scream foul.

Secondly, the aim is to get material to every worker. It may well be that a small minority, a minority or even a majority of workers would prefer that their addresses remained confidential and were not handed to the union. This is a mechanism—having a cut-out in-between—for that purpose in the process. I think the bulk of the objections or the anxieties that they might have are fully answered—I might argue that they are more than fully answered—but they should certainly give rise to no apprehensions.

Lord McCarthy: I would like to know where they are fully answered. Is the Minister saying that they have been fully answered this afternoon? Where they should be fully answered is on the face of the Bill. For example, one of the issues that has given rise to concern is that new paragraph 19C(2) says:

That does not specify anything. Much of what the Minister has been telling us today has been about the advantages that would fall to the unions, because they could make the employer do such things. That is an advantage and it should be on the face of the Bill, whereas phrases such as "to handle communications" just give rise to worry.

Lord Triesman: I think it is always as well to read the whole of a clause, rather than a few words from it. The words,

are precisely in the context of the process that I have described. That is the intention. Although it is not likely to be written into the text of the Bill, I have said
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this afternoon that there is no intention of disrupting other kinds of communication between a union and its members, nor is there, or has there been at any stage in the work on the Bill, that intention.

Lord McCarthy: We shall see if the Minister will accept an amendment of that kind on the face of the Bill at Report.

Lord Triesman: For additional clarity, I ought to set out—and this is an elaboration, not a retraction of any element—that the CAC has no such power at the moment. That question was asked. It has no such power but the Bill establishes a duty on the employer to supply the addresses to the CAC and that is a necessary condition for the communications to take place. I have stated that in general terms, but that answers the final point that was raised.

Baroness Turner of Camden: As I said earlier, it was never our intention to press the matter—indeed, we cannot in Committee. We were anxious to obtain from the Minister an explanation of what this was all about and we have had that explanation. We will consider his comments carefully and see whether there is any need for us to come back at Report with any other suggestion. In the meantime I shall not press our opposition to the clause.

Clause 5 agreed to.

Lord Lea of Crondall moved Amendment No. 12:

"REQUIREMENT OF CAC TO ARRANGE FOR BALLOT In paragraph 22(4)(a) of Schedule A1 to the 1992 Act (duty of the CAC to make arrangements for a ballot in the interests of good industrial relations), after the words "the CAC is satisfied that" insert "because of special circumstances"."

The noble Lord said: As this is the first time I have contributed to this Committee, there are one or two preliminary remarks that I need to make before turning to the substance of the amendment.

First, I need to mention that I am a member of the CAC—a body of some 60 members. A dozen are independents who chair the panels on cases under the overall chairmanship of Sir Michael Burton. Two dozen are drawn from an employer's background and a similar number from a worker's background—I am one of the latter. I guess that each of the wing members such as myself takes about half a dozen cases in the course of a year.

I want to make it clear that I am not pretending to represent the CAC, which is obvious. On a separate point, there is actually no CAC policy on the matters that we are discussing, so there is no problem about that. The CAC would recognise the distinction between the technical matters upon which it is consulted, and policy matters, which are strictly for Parliament.
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A good example of the former—a technical matter on which the CAC is consulted—is the resources and other implications of the handling of cases under the information and consultation regulations, which we will be hearing about later, that will follow from the Bill and are, in turn, the result of the transposition of the EU directive agreed under the Social Chapter three or four years ago. However, the CAC is obviously not a principal player in the policy issues involved in the directive.

To take another example, it is clear that on such issues as the cut-off of 21 or more workers for small firms, or the 40 per cent minimum yes vote in a ballot, the CAC does not take a view. There are other examples concerning the architecture of the recognition procedure, on which it does not take a view. I hope that that avoids any potential for misunderstanding.

As has already been revealed in the contributions this afternoon, there is, happily, a great deal of information in the public domain on the experiences of employers and unions on the three years' work so far. There have been annual reports, case reports on the Internet and statements from the TUC and the CBI on the review of the 1999 Act.

Let me now address the specifics of Amendment No. 12. We are discussing the experience of applying the procedure for a union to seek that the CAC awards recognition without a ballot, based on being able to demonstrate that it has more than half of the bargaining unit in membership. The procedure set out in paragraph 22 of Schedule 1 to the Employment Relations Act 1999 is, I think, sufficiently familiar. There are three provisos, however, to paragraph 22(4) of Schedule 1 to the 1999 Act. Confusingly, it is called the 1992 Act, although it was not introduced by John Major or Mrs Thatcher or anybody of that party. That is a matter for the Public Bill Office. However, I will talk about the 1999 Act for convenience.

The provisos are exclusively put forward, in practice, by the employer. The employer will have been the resisting party, obviously. If not, it would have made a voluntary recognition agreement. Having challenged at the earlier stage, under the headings of designation and the bargaining unit, the employer will turn to the small print in paragraph 22(4)(a), which indicates that, despite the 50 per cent test having been satisfied, the CAC may order a ballot if it can be demonstrated that it needs to order one,

That time-honoured phrase, respected by everyone in this room, is questioned by no one. The problem is that the provision, as it stands, is rather hard to apply. Indeed, that is an understatement. Let me explain why.

We have heard reference this afternoon to the judgment of Daniel. The CAC could be in that position, with the union saying that to insist on a ballot in these circumstances of demonstrably over 50 per
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cent membership would be a provocation to good industrial relations. The employer, naturally, would say precisely the opposite.

Panels of the CAC may feel that they are on uncertain ground, with judicial review looming over them, whichever way they decide on this time-honoured form of words. The fact that Parliament was perhaps not as clear as it might have been, in retrospect, means that the opportunity can and should be taken to clarify what really is behind paragraph 22(4)(a) so that it does not lead to deadlock.

What are the weight and locus of the qualifications on the one hand, relative to the weight of the main substantive provision on the other? I submit, having looked at the history, that what was meant by paragraph 22(4)(a) was that some special factor needs to be adduced and put before the CAC—a factor which must be convincing in some objective sense with regard to disrupting industrial relations. If that is the case, it needs to be spelt out.

How can we find some test—some wording—which would help to ensure that it is convincing in an objective sense? I have put down these words to convey the meaning that there must be special circumstances. Let us see whether that is a good form of wording. It would not just reopen the earlier stages of the hearing when, for example, the employer was far from reconciled to the inclusion of managers in the bargaining unit and said that that would disrupt industrial relations. That had been decided by the agreement on the bargaining unit. By the stage under discussion, that would be water under the bridge. If that were not so and everything was up for discussion all over again, the CAC panel would simply be going round in circles.

The words "special circumstances" may not be totally without difficulty. But anyone who wishes to make that point should be careful—the only totally unambiguous way out of this would be to abolish the whole of paragraph 22(4). I know—it is self-evident—that my noble friend the Minister is not encouraging me to go down that road. Equally, I assume that he will accept that we need to sharpen up what paragraph 22(4)(a) covers.

I have put forward this amendment in an endeavour to resolve the problem in a way that is as near to consensual as we can find. I beg to move.

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