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Lord Campbell of Alloway: I wholly understand the problem put by the noble Lord and wholly accept what he wants to achieve. The problem is that the words he proposes will not achieve it. If he were to use quite a simple concept and say that the CAC should be satisfied that arrangements should be made for the ballot in the interests of good industrial relations, he would put the exercise of discretion quasi-judicially within the CAC. That cannot be attacked on judicial review unless there is a taint of bad faith or quite exceptional unreasonableness. So I support the
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concept of the amendment but respectfully suggest that the object could be achieved if these words were used.

Lord Lea of Crondall: The difficulty is that that is where we are at the moment, more or less. In paragraph 22(4)(a), the first qualifying condition is that,

As I say, it is the judgment of Daniel. We do not want to promote a philosophical discussion about the nature of industrial relations—I am sure that that was not intended. It was meant to cover a case—I suppose we can hypothesise about what such a case might be—in which there was some very particular factor that meant that just to give recognition without a ballot would be very ill judged in the context and that to do so would require a pretty special set of circumstances. Copies of Hansard in 1999 show that that was what was intended. At present, the problem of judicial review is that it is very hard to pin down the basis on which the CAC can do its job. That is why I suggest that there have to be special circumstances.

Lord Campbell of Alloway: With respect, if one inserts the expression "special circumstances" into the wording that I have suggested, one cannot do better because one cannot invoke judicial review. One is giving discretion to the CAC to exercise if it thinks that it is in the interests of good industrial relations and that special circumstances obtain. That is not a position which the High Court will investigate unless there is obvious unreasonableness or evidence of bad faith, and we are not concerned with bad faith with the CAC.

Lord Lea of Crondall: I am grateful to the noble Lord for endeavouring to be helpful. The problem of judicial review is not the only rationale for the amendment, although it is looming over the CAC on a number of occasions.

Lord McCarthy: If we look at paragraph 22 of Schedule 1 to the 1999 Act, it is clear that only one of these three qualifying conditions is necessary—any one will do. In a way, it would be more logical if heading (a) came at the end, but it does not, because (b) is quite precise and refers to,

There could be evidence for that. You could count that. That is a specific case in which you might say that because of that evidence, a ballot should be held in the interests of good industrial relations.

The qualifying condition in heading (c) is that,

Again, a precise test could be mounted for (c) so (b) and (c) seem to be all right. I do not know whether they are in practice—that is my question.
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Heading (a), which refers to the CAC being satisfied that a ballot should be held in the interests of good industrial relations, seems to be an attempt to have a generalisation. There might be many cases—(b), (c) (d), (e) and (f)—which we do not want to put on the face of the Bill so we will have the general requirement that the CAC must be satisfied. But because it is not defined, it is difficult to apply. Would it not be the case that you would get all that you want if you just abolished (a) and left (b) and (c) in place?

Lord Lea of Crondall: I have great sympathy with the proposition put forward by my noble friend. To be honest, I want an amendment which does not abolish either the whole paragraph or heading (a) because the balance must be maintained with great care and delicacy. I cannot fault the logic of what has been said about renumbering the headings so that (a) comes after (b) and (c). It would be very helpful. In the spirit of what was intended in 1999, I am quite certain that heading (a) was not seen as a catch-all measure to drive a coach and horses through the provision.

Baroness Miller of Hendon: I have listened with great interest to the conversations between both sides of the Committee. It is interesting that all Members who have spoken have vast knowledge of trade union law and practice. I feel diffident in putting my tiny comment in the middle of it all, particularly as we have discovered that the Minister has great experience in negotiating on behalf of trades unions and as an employer. And my noble friend has great experience as a lawyer.

When I read Amendment No. 12 during the Recess, I came to the conclusion that what I said at Second Reading was extremely important. We need a consolidating Act. The amendment refers to,

which I did not have with me. That schedule is to be found in the 1999 Act, which I also did not have with me. Now we are in debate on the Employment Relations Bill when all these issues arise. If an employee were trying to discover what his rights might or might not be in front of a CAC, it would be impossible to find any information in the framing of the provisions.

Heading (a), one of the three qualifying conditions which allows the CAC to conduct a ballot, provides that the CAC must be satisfied that a ballot should be held in the interests of good industrial relations. If it is so satisfied, does it not make it somewhat easier than adding the words "because of special circumstances"? We may enter a difficulty over court cases and so forth. I do not believe that the amendment has got to the nitty gritty of what the noble Lord is seeking and it makes things more difficult. However, like other Members of the Committee, I shall listen to what the Minister has to say.

Lord Lea of Crondall: Before the Minister rises, perhaps I may clarify my intentions. The CAC can be
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in the difficult position of disagreeing with an employer who says that there would be negative consequences for industrial relations. It is a value judgment against the employer and that is not easy territory for the CAC.

Lord Triesman: I thank my noble friend Lord Lea for his explanation and all Members who have taken part in the debate. There is a good deal of expertise in the Committee, which is always helpful on issues of this kind.

The amendment reflects a concern that there are no guidelines for the CAC in applying the condition in paragraph 22(4)(a)—the condition which allows the CAC to call a ballot of the workers in the bargaining unit where a majority of them are members of the union if it is satisfied that it would be in the interests of good industrial relations to hold a ballot.

Up till the end of March 2004, unions had claimed majority membership at acceptance in 57 cases. The CAC saw fit to order a ballot in 11 cases where the union opposed the ballot on the grounds that it had a majority in membership. In eight of these cases, this was in whole or in part because the CAC considered that a ballot should be held in the interests of good industrial relations. So only in a minority of cases has the CAC exercised its power under the paragraph. The factors or circumstances which led the CAC to reach these decisions were very varied and it would not be truthful to say, "There you are, there is a clear pattern".

I should add that there is no evidence to suggest that CAC panels have used their power freely or in a capricious or inappropriate way.

[The Sitting was suspended for a Division in the House from 5.49 to 5.59 p.m.]

Lord Triesman: I think that I had enumerated the cases and their outcomes, and was making the point that there is no evidence to suggest that CAC panels have used their powers freely or capriciously in ways that are inappropriate. None was presented throughout the review of the Employment Relations Act 1999. I am therefore far from convinced that there is a problem that needs to be addressed.

Moreover, the amendment does not seek to define what should be considered as special circumstances for this purpose, a point made by the noble Lord, Lord Campbell of Alloway. I believe that it would be very difficult to do so. The climate of industrial relations in any workplace may be affected by a number of circumstances which are quite specific to that workplace. What counts as a reason to believe that a ballot would improve industrial relations in one workplace may well lead the CAC to the opposite conclusion in another, depending on the attitude of the workers and the parties involved, the recent history of industrial relations at the workplace, and so on.

The Government do not believe, therefore, that it would be appropriate or practical to place a limit on the circumstances which the CAC is able to take into account in reaching a decision on whether paragraph 22(4)(a) is to apply. I ought to emphasise that members
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of the CAC, including, of course, the noble Lord, Lord Lea, are chosen for their industrial relations expertise. It is very real and very extensive expertise. The Government believe that they are well equipped to judge whether industrial relations are likely to be improved in any particular circumstance. And, of course, were the CAC to order a ballot in the interests of good industrial relations without sufficient grounds in a way that could be considered unreasonable, its decision could be the subject of judicial review, as we have already noted.

As the noble Lord, Lord McCarthy, said in relation to paragraph 22(4), in making these kind of judgments, it is possible to metricate some things. However, as regards industrial relations, it is impossible to metricate everything. Inevitably, some things will be matters of judgment about whether or not they help the relevant environment. Frequently when issues are discussed at ACAS, it is not a case of measuring something but of trying to find a balance in which everyone accepts that there has been a good industrial relations outcome. "A good industrial relations outcome" is one of the terms that is used frequently in the schedule and for very good reason.

In view of the broad range of situations the CAC may be asked to consider, I believe it makes sense to give it a broad discretion to take into account the circumstances it considers relevant in the light of its industrial relations expertise. Defining these circumstances would risk excluding matters which may well in some cases have a considerable bearing on the question of whether a ballot might improve industrial relations.

As regards the comments of the noble Baroness, Lady Miller, on producing another consolidation Act, I can well see the attraction of it. However, it is not standard practice to undertake frequent consolidations in legislation as they take up so much parliamentary time and absorb a large amount of the Government's legal resource. The case for undertaking another consolidation of trade union legislation has to be assessed against competing legislative priorities, although I acknowledge that it would be handy on occasion to reach for a single book to find the answers.

Therefore, I respectfully ask my noble friend Lord Lea to withdraw the amendment.

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