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Baroness Miller of Hendon: I ask a question and either the noble Lord or the noble Baroness can tell me whether I am wrong. My understanding is that there is nothing to prevent unions conducting recruiting drives at any time irrespective of the recognition process and that it would be perfectly in order for them to do that.

New sub-paragraph (2)(a) in Clause 9—the provision against undue influence—prohibits offering anything to a worker in return for the worker voting in a particular way. I comment mildly only that I believe there is quite a fine line between breaching that provision and the proposed amendment that would allow unions to campaign for union membership. I do not feel terribly strongly about the matter but I wondered whether one should not be rather careful about this as during the recognition process I believe that unions would be entitled to use records, addresses and so on. Would it be correct to use that for another purpose; that is, for recruitment?

Lord Triesman: As Amendments Nos. 19 and 26 make identical changes to Clauses 9 and 12 of the Bill,
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with your Lordships' permission I shall confine my comments to Amendment No. 19 for the purposes of simplicity. However, my remarks will apply equally well to Amendment No. 26.

I start by emphasising that the way in which the clause is framed is rooted in electoral law. It seeks, on the basis of a very well tried system, to ensure that people are not subject to inducements or commit improper actions.

My noble friends' amendments seek to address concerns that have been raised by the TUC with respect to the definition of unfair practices contained in paragraphs 27A and 119A. The TUC has indicated that it is concerned with the wording of paragraph 27A(2)(a). It is eager to ensure that it should not capture general statements by a union about the benefits of recognition, or, indeed, any other benefits that a union may provide.

The definition of unfair practices in relation to recognition ballots which we have set out in paragraph 27A(2) draws upon standards of behaviour for public elections as set out in the Representation of the People Act 1983. Paragraph 27A(2)(a) captures the offences of bribery and treating which are set out in that Act. Bribery is the offer of financial reward to a voter in exchange for his voting in a particular way, or for not voting at all. Treating is the offer of non-financial benefits.

Paragraph 27A(2)(a) states that a party to a recognition ballot uses an unfair practice if he,

I think we can all agree that bribery and treating of workers are practices which should be outlawed during recognition and derecognition ballots. Trade unions have, however, expressed concern that the wording of the provision may capture offers which will be legitimately made by a union in the course of a recognition campaign. For example, the union may wish to offer to deploy skilled negotiators who would push for negotiated improvements in terms and conditions if recognition were to be achieved.

Let me make it clear that the Government are in complete agreement with the trade union partners that this sort of statement, made in the course of legitimate campaigning, should not be considered an unfair practice. We are seeking to protect workers, unions and employers alike from underhand attempts to influence the outcome of a ballot. In doing so, we have taken care to ensure that the parties' right to engage in legitimate campaigning activity is not restricted. I use the word "parties" in the plural because it must be in the plural if this is to be a genuinely fair operation. Positive and responsible campaigning behaviour can only encourage participation and well informed voting choices. We intend to reinforce this in the code of practice.

I mention the code of practice again because that is where we shall be able to set out detailed guidance for the parties on the sorts of statements which constitute legitimate campaigning, without trying to write a list,
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which would never be an accurate or a fully exhaustive list, on the face of the Bill. There is no intention whatever to rule out statements of benefits.

However, the Government's legal advice is that paragraphs 27A(2)(a) and 119A(2)(a) do not have the effect which the unions fear. Put simply, that is because in order to fall within the meaning of an unfair practice, an offer must be made in return for a worker's agreement to vote in a particular way or not to vote at all. In the Government's view, it is difficult to see how the offer by a union of benefits such as improved representation as a consequence of recognition being achieved could be considered to have been made in direct exchange for a commitment by an individual worker to vote in a certain way. We do not believe, therefore, that amendments of this nature are required. In any case, I am not completely convinced that my noble friends' amendments would achieve the effect they desire. There are minor drafting points, as I know there always are at this stage so I shall not labour the point.

The Government are involved in ongoing discussions with the TUC at both ministerial and official level. The TUC have helpfully provided us with detailed explanations of their concerns and we are giving those very careful consideration. Should our deliberations reveal any doubt that the unfair practices provisions circumscribe the freedom of either party to engage in legitimate campaigning activity, we shall of course consider bringing forward amendments at a later time. I hope that I have been able to reassure my noble friends about their concerns. I respectfully urge them to withdraw their amendments.

Lord McCarthy: The noble Lord has not been with us all that long, but we have been here so many times before. It is always said that legal advisers say that such matters will be in codes of practice, but they will never put them on the face of the Bill. It would be so much simpler if this were put on the face of the Bill. We do not necessarily want our words, but just give us some other words.

The Government made up the matter about negotiation; the noble Lord knows that much better than me. If there is a recognition campaign and one is trying to get membership, one will not stop to say, "You will have skilled legal advisers". That is very sophisticated. One says, "We shall get you more money", or, "Join this union and next week as soon as you have joined and we get recognition, we will put in a wage increase for another 10 per cent". That is a benefit. Some people may say that it is a bribe of some kind. So what? Cruel things take place and cruel things are said in such matters.

It is no good having legal advisers saying that in sophisticated situations it will not arise. It will arise. It is no good saying, "We are going to put in a code of practice", because we shall not see the code of practice until six or nine months after the Bill is on the statute book. The code of practice, as the noble Lord knows very well, will not be the law; it will be taken into
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account. There is no alternative: if one really wants to do something one should go away and make it up oneself or put something on the face of the Bill. I beg the Minister to put something on the face of the Bill, just for once.

Baroness Turner of Camden: First, I thank the Minister for the very comprehensive way in which he has dealt with our amendment. I am glad to learn that it is not the Government's intention to inhibit the campaigning that unions will do in pursuit of recognition. Of course, my noble friend Lord McCarthy is right. We want to see something on the face of the Bill. We are not wedded to our own words. This is Committee stage and this is a first stab. We tried this wording because we received from the TUC its views on the Bill. We did the best that we could at the time. That does not mean to say that we are wedded to the wording at all.

We want to consider what has been said. I share the view that we would like something on the face of the Bill. We want it made very clear that if unions set out their stall when they are campaigning, and say, as my noble friend has said, "We can do better for you than you can do for yourself; we are good at collective bargaining; we have a good legal aid system", and so on, that should not be seen as offering any kind of bribe to workers or giving any kind of excuse to an employer to head off to the CAC and complain that unions are utilising an unfair practice. In the mean time, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Triesman moved Amendment No. 20:

"27C (1) This paragraph applies if the CAC decides that a complaint under paragraph 27B is well-founded.

(2) The CAC must, as soon as is reasonably practicable, issue a declaration to that effect.

(3) The CAC may do either or both of the following— (a) order the party concerned to take any action specified in the order within such period as may be so specified, or (b) give notice to the employer and to the union (or unions) that it intends to arrange for the holding of a secret ballot in which the workers constituting the bargaining unit are asked whether they want the union (or unions) to conduct collective bargaining on their behalf.

(4) The CAC may give an order or a notice under sub-paragraph (3) either at the same time as it issues the declaration under sub-paragraph (2) or at any other time before it acts under paragraph 29.

(5) The action specified in an order under sub-paragraph (3)(a) shall be such as the CAC considers reasonable in order to mitigate the effect of the failure of the party concerned to comply with the duty imposed by paragraph 27A.

(6) The CAC may give more than one order under sub-paragraph (3)(a).

27D (1) This paragraph applies if the CAC issues a declaration under paragraph 27C(2) and the declaration states that the unfair practice used consisted of or included— (a) the use of violence, or (b) the dismissal of a union official.
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 (2) This paragraph also applies if the CAC has made an order under paragraph 27C(3)(a) and— (a) it is satisfied that the party subject to the order has failed to comply with it, or (b) it makes another declaration under paragraph 27C(2) in relation to a complaint against that party.

(3) If the party concerned is the employer, the CAC may issue a declaration that the union is (or unions are) recognised as entitled to conduct collective bargaining on behalf of the bargaining unit.

(4) If the party concerned is a union, the CAC may issue a declaration that the union is (or unions are) not entitled to be so recognised.

(5) The powers conferred by this paragraph are in addition to those conferred by paragraph 27C(3).

27E (1) This paragraph applies if the CAC issues a declaration that a complaint under paragraph 27B is well-founded and— (a) gives a notice under paragraph 27C(3)(b), or (b) issues a declaration under paragraph 27D.

(2) If the ballot in connection with which the complaint was made has not been held, the CAC shall take steps to cancel it.

(3) If that ballot is held, it shall have no effect.

27F (1) This paragraph applies if the CAC gives a notice under paragraph 27C(3)(b).

(2) Paragraphs 24 to 29 apply in relation to that notice as they apply in relation to a notice given under paragraph 22(3) or 23(2) but with the modifications specified in sub-paragraphs (3) to (6).

(3) In paragraph 24(5) for "10 working days" substitute "5 working days".

(4) An employer's duty under paragraph (a) of paragraph 26(4) is limited to— (a) giving the CAC the names and home addresses of any workers in the bargaining unit which have not previously been given to it in accordance with that duty; (b) giving the CAC the names and home addresses of those workers who have joined the bargaining unit since he last gave the CAC information in accordance with that duty; (c) informing the CAC of any change to the name or home address of a worker whose name and home address have previously been given to the CAC in accordance with that duty; and (d) informing the CAC of any worker whose name had previously been given to it in accordance with that duty who has ceased to be within the bargaining unit.

(5) Any order given under paragraph 27(1) or 27C(3)(a) for the purposes of the cancelled or ineffectual ballot shall have effect (to the extent that the CAC specifies in a notice to the parties) as if it were made for the purposes of the ballot to which the notice under paragraph 27C(3)(b) relates.

(6) The gross costs of the ballot shall be borne by such of the parties and in such proportions as the CAC may determine and, accordingly, sub-paragraphs (2) and (3) of paragraph 28 shall be omitted and the reference in sub-paragraph (4) of that paragraph to the employer and the union (or each of the unions) shall be construed as a reference to the party or parties which bear the costs in accordance with the CAC's determination.""

The noble Lord said: I shall speak to Amendments Nos. 20, 22, 29, 90, 91, 92 and 93. As the Committee will be aware, the measures contained in Clause 9 were added to the Bill in another place, as has been mentioned. As my honourable friend the Minister explained at the time those amendments were moved, intimidation is a complex issue. It has taken us some time to work out all the details and to consult key stakeholders on our full proposals.
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Clause 9 currently contains a power for the Secretary of State to provide by order for the consequences of a finding by the CAC that a complaint of unfair practices is well-founded. The Government signalled their intention to bring forward amendments in your Lordships' House which would remove this power and put on the face of the Bill the remedies available to the CAC where it makes such a finding. I am pleased to present these remedies to the Committee in this group of amendments which provide the sanctions which apply where an unfair practice has been found to have occurred during the period of recognition ballots.

Grouped with the Government's amendments is Amendment No. 21 tabled by the noble Baroness, Lady Miller, which amends government Amendment No. 20. For clarity I shall deal only with the Government's amendments and I shall respond to the noble Baroness when she has moved her amendment.

The substance of the sanctions is contained in Amendment No. 20. The amendment deletes paragraph 27C, which contains the power for the Secretary of State to provide for the sanctions by order. It then adds new paragraphs 27C to F. Those provide that where the CAC finds that a complaint of an unfair practice is well founded it must, as soon as is reasonably practicable, issue a declaration to that effect. This signals clearly to the parties and, more importantly, to the workers in the bargaining unit that the behaviour in question was improper. If it considers it appropriate, the CAC may then issue an order against the party responsible—whichever party it may be—for the unfair practice to take such action as it considers reasonable to mitigate the effect of the unfair practice in question. In addition, it may decide that there should be a fresh ballot.

If the party in question fails to comply with the CAC's order or commits another unfair practice after it has received the CAC's order, then a second sanction may be issued against it. Later this week we shall see the start of the European football competition, to which many of us shall pay great attention, providing that the timetable of the House makes that possible. That is a heartfelt appeal. I believe that I have just described a yellow card and a red card system. In this case, the red card which the CAC may choose to award, depends on which party has committed a second unfair practice. If it is the employer who has ignored an order of the CAC or committed a second unfair practice, then the CAC will be able immediately to issue a declaration that the union is recognised. If the union is responsible for a further unfair practice or for failing to comply with an order to take mitigating action, the CAC may issue a declaration that the union is not entitled to be recognised.

This system is fair and workable. The CAC's ability to issue an order against a first-time offender ensures that the parties are given an opportunity to correct their behaviour. Should they fail to do so, however, this amendment provides for a strong sanction. I believe that this will act as a significant deterrent for any party contemplating furthering its own cause through illegitimate campaigning.
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There are two exceptions to this "two strikes and you're out" approach. I have now mixed metaphors—one relating to football and the other to the United States—for which I apologise. The first concerns violent conduct. British industrial relations are peaceful industrial relations, which is good to say, and for the most part the parties seek to resolve their differences through dialogue. However, we know from the experience of other countries that certain parties have had resort to the violent intimidation of workers. There can be no place for such conduct in a civilised society.

The Government have therefore provided that, where a party is guilty of committing an unfair practice involving violence, the CAC will have the discretion to declare immediate recognition or declare that the union is not entitled to be recognised, even where it is a first offence. That would be a straightforward matter, quite apart from anything that may occur in terms of criminal law.

The same will apply to unfair practices by an employer which involve the dismissal of a union official. A union official is defined at Section 119 of the Trade Union and Labour Relations Act 1992. As well as a full-time officer of the union, a union official is any person elected or appointed in accordance with the rules of the union to be a representative of all or some of its members, including representatives who are employed by the same employer as the members whom he represents. In other words, this category covers the lay representatives of an unrecognised union.

The union's activist is normally vital to any campaign for recognition. He or she is the union's main point of contact with the workers and the main source of information about the progress of the campaign. Unfortunately, it is not inconceivable that a small minority of employers might seek to undermine the union's campaign by dismissing such a representative without justification. Unions allege that such behaviour has already occurred.

It is not hard to imagine the effect that that will have on the workers in the bargaining unit. The message is clear: vote for the union and you risk the same fate. Of course, employers must retain the right to discipline and dismiss their workers where that is called for. These measures do not seek to interfere with that right at all. However, where such a dismissal is made with the intention of intimidating other workers and damaging the union's ability to campaign fairly, the Government believe that it is right that the CAC should be able to impose the strongest sanction. Again, we are sending a clear message that such behaviour will not be allowed to undermine the statutory procedure.

These amendments have been designed to ensure that the CAC has sufficient discretion to ensure that it can take into account all the circumstances of the case before it. Cases where allegations of unfair practices are made may be complex, perhaps involving both claims and counter-claims about intimidatory behaviour. The context in which any unfair practice occurred and the behaviour of all the actors involved
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will be important in determining what sanction is appropriate and, in particular, whether it merits the strongest sanction. Moreover, a formal sanction may not be required where the intimidatory behaviour has backfired and workers have effectively punished the guilty party at the ballot box. The structure we have provided will allow the CAC to take into account all the circumstances of the case in order to decide whether a particular sanction is appropriate.

I draw the Committee's attention to the arrangements for the CAC to require that a further ballot be held. Where it finds that an unfair practice has occurred and the ballot has either closed or is already underway, it will be open to the CAC to order that a new ballot be held. The results of the first ballot may have been tainted in the eyes of the parties on both sides. We believe it is important that all the parties can have faith in the result of the ballot.

That is why it is important that the CAC should have the ability to order a further ballot where the result is above suspicion. We do not envisage that the CAC would choose to re-run a ballot where the party responsible for the unfair practice had lost the original ballot.

Amendment No. 22 makes it clear that, where the CAC exercises its discretion to call a second ballot, it is no longer under a duty to reveal to the parties the result of the first ballot. That is essential, otherwise it would taint the second ballot.

Amendments Nos. 29, 90, 91, 92 and 93 make consequential amendments to others parts of the Bill and to the parts of the schedule which contain cross-references to declarations of recognition by the CAC to include declarations under the CAC's new powers. I beg to move.

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