Lords statement on Brexit: Protection for Workers - Mar 7

My Lords, with the leave of the House I shall now repeat a Statement made in another place by my right honourable friend the Secretary of State for Business, Energy and Industrial Strategy. The Statement is as follows:

 

“Mr Speaker, I would like to make a Statement about workers’ rights when we leave the European Union. Before I do, since this is my first time at the Dispatch Box since his death, I want to put on record our deep appreciation of the life and work of Lord Bhattacharyya. A heroic figure in British manufacturing, Lord Bhattacharyya’s work attracted investments to which hundreds of thousands of working men and women owe their livelihood. A Labour Member of the House of Lords, Kumar worked easily with Ministers—indeed, Prime Ministers—from all parties for the benefit of the people of the West Midlands and the nation. 

 

The United Kingdom and this Parliament have a proud record of improving the rights of working men and women, from Shaftesbury’s factories Acts and William Hague’s Disability Discrimination Act to the minimum wage introduced by a Labour Government and the national living wage brought in by a Conservative Government. While the EU sets minimum requirements in many areas of workers’ rights, and health and safety requirements, time and again Britain has been in advance of them and has chosen to exceed them.

 

The EU agency for the improvement of working conditions ranks the UK as the second-strongest, behind only Sweden, of all 28 member states for well-being in the workplace. The UK offers 39 weeks of statutory maternity pay compared with the 14 weeks required by the EU. We have given fathers and partners a statutory right to paternity leave and pay—something that the EU is only just starting to consider. Our national living wage is one of the highest in the EU and the Low Pay Commission, which advises on it, is widely respected. As we have not, in practice, been limited by EU standards, there is no reason why we should not maintain this record of leadership outside the EU.

 

The Prime Minister has given a commitment that Brexit will not be allowed to erode workers’ rights. Nevertheless, some honourable Members have advanced the view that a parliamentary mechanism should be established to monitor and implement that commitment. The honourable Member for Great Grimsby introduced a Private Member’s Bill to that effect, and the honourable and right honourable Members for Bassetlaw, Don Valley and Stoke-on-Trent Central proposed an amendment to a previous Motion in a similar vein. We have been discussing closely with Members across the House and with trade unions and businesses how we can turn this intention into law. The Government are today publishing draft clauses for inclusion in the withdrawal agreement and implementation Bill to put these commitments into law. 

 

There are two main features of the clauses. First, there will be a new statutory duty placed on Ministers bringing forward a Bill that affects employment or workplace health and safety that they should certify, before the Second Reading of any such Bill, that it is compatible with the principle of non-regression that the Prime Minister has given. They will be required to provide explanatory information to Parliament in support of the statement, which will be drawn up following consultation with businesses and trade unions. This will ensure that while respecting and upholding the sovereignty of Parliament, in the future Members of this House will be able clearly to consider the compatibility of every proposed measure with the non-regression principle to which the Prime Minister has made a commitment. 

 

The second aspect of the draft clauses concerns future EU legislation. Parliament will be given the opportunity at least every six months to consider any changes to EU workers’ rights and health and safety standards in the workplace. This will be reported to Parliament through a document which has been subject to consultation with employers and trade unions. It will be scrutinised by the relevant Select Committees of this House. The Government will be required to table an amendable Motion on their intended course of action on those new EU rules. For example, the Government may set out that they intend to legislate to give effect to those commitments; that they intend to give effect to them in a different way; or that they do not intend to give effect to them, setting out their rationale.

 

A number of legislative proposals are under consideration in the EU which have a deadline for transposition into national law after the implementation period. We would expect them to be put forward for Parliament’s consideration under this new process. The draft clauses, published in a Command Paper today, combine well our determination to honour the commitment the Prime Minister has made not to see workers’ rights weakened, with respecting the sovereignty of this Parliament. 

 

A similar framework will also apply to environmental protections as the UK leaves the EU, implemented through the Environment Bill. On 19 December, we published the draft Environment (Principles and Governance) Bill, which is the first part of a much larger environment Bill to follow in the next Session. The draft Bill outlines our proposals to establish a world-leading body to hold Government to account for environmental outcomes after the UK leaves the EU. The draft Bill also requires the Government to publish a statutory policy statement on the interpretation and application of nine environmental principles, including the four contained in the EU treaties. Further, the Government will legislate to ensure that where future Bills could affect environmental protections, a Minister of the Crown will make a Statement of compatibility to Parliament and provide explanatory information. We will also create a new statutory duty on the Government to monitor any strengthening of environmental protections and regulations by the EU and to report regularly to Parliament about the Government’s intended course of action in those areas. This will give Parliament the information it needs to consider whether domestic protections need to be strengthened accordingly.

 

Through these commitments, the Government will provide a robust framework for the maintenance and strengthening of environmental standards as the UK leaves the EU. In addition to these measures, I am also announcing today steps that will strengthen the enforcement of employment rights. The vast majority of businesses operate fairly and treat employees well, but I have been concerned about practices in a small number of firms in a small number of industries where abuses of conditions are used to the detriment not just of workers but of reputable competitors who suffer a disadvantage by comparison. 

 

I intend to consult broadly on establishing a new body to bring together the relevant enforcement functions of the Gangmasters and Labour Abuse Authority, HMRC and the Employment Agency Standards Inspectorate. As part of the forthcoming spending review we will consider what level of funding is appropriate to ensure that it is adequately resourced to deliver its strengthened remit.

 

The measures I have announced today reflect a process of engagement across this House and with employers and trade unions. Not everyone will agree with every proposal. But if, as I hope, an agreement can be reached on the withdrawal process, they serve as a helpful guide to how we might find and act on common ground across the House in the next phase of negotiations. I commend this Statement to the House”.

My Lords, I first thank the Minister for repeating the Statement made in the other place and especially for his kind words about Lord Bhattacharyya.

 

The crux of the Government’s announcement is the two amendments they will table to the implementation Bill. We are told that these seek to ensure there is no regression of workers’ rights, and that Parliament will be given an opportunity to consider how rights in the UK tally with those in the EU. These are noble aims which I am sure this House can get behind. However, I am afraid that on this side of the House we have considerable concerns over whether these amendments will achieve and deliver this.

 

I remind the Minister of the comments that Frances O’Grady of the TUC made yesterday in response to the announcement:

 

“In the face of a government determined to reduce rights, these measures would in no meaningful way compensate for the loss of the protections that currently exist”.

 

 

The TUC and various unions have been clear in their response to the proposals, saying that they are not good enough and fail to protect workers after we leave the EU. Noble Lords will not be surprised to hear that I agree with those statements.

 

I turn to specifics. I am interested in the Government’s process of getting to this announcement. Can the Minister detail his department’s process of consultation with the different unions and the TUC? The issue at the heart of this announcement is that, even if a Statement by the Government notes that legislation would in fact lead to a regression of rights, there is no power to stop the Government proceeding with their intended course of action. Can he explain how these amendments would stop a Government reducing workers’ rights if they wanted to? If he thinks I am being a bit unfair, I remind him of the working time directive. It was a Conservative Government who sued the European Commission, claiming that there was no legislative basis for the directive since working time had nothing to do with health and safety at work. Luckily for workers in the UK, the Government lost.

 

On the process of adopting future improvements in EU legislation, the proposal is equally lacking. The only means of challenge is through Parliament, not the courts, and thus subject to any Government’s majority—not material facts that could be legally tested. Furthermore, these proposals apply only to changes to primary legislation. Any other forms of legislative change would not be covered. Given that the bulk of UK legislation to implement EU law is secondary legislation—the Working Time Regulations, TUPE and health and safety regulations, to name but a few—would the examples given above be covered under the new proposals? As we have seen recently, Commons procedures may not permit sufficient amendments to actually deal with all the problems at hand.

 

The Statement uses the words “standards” and “reduction of standards” and I seek clarification from the Minister on this. In speaking against Amendment 3 on the Trade Bill last night, the Minister said:

 

“First … The term ‘standards’ does not have a single legal definition which can easily be called upon … Secondly, on the notion of ‘reducing’ standards, how the Government would prove that they were or were not reducing them would be problematic”.—[Official Report, 6/3/19; col. 631.]

 

 

The Government cannot have it both ways. Either the use of the terminology “standards” and “‘reducing’ standards” is correct and proper or it is not.

 

The Statement provided today is not good enough. The comments made at its beginning suggesting that the Minister’s party has suddenly assumed the role and mantle as a champion of workers and working people is baffling. Annual earnings are more than 3% lower than they were in 2008 and nearly 4 million people are now in insecure work. If the Government are serious about workers’ rights in the UK, they have a long way to go to prove it.

I agree with the Minister that we have a proud record of protecting workers’ rights. As he said, in many cases they are stronger than in European law. 

 

I welcome the enforcement measures announced by the Secretary of State yesterday on existing rights. We all know that it is pointless introducing legislation unless someone intends to enforce it, and enforcement costs money. We on these Benches will look closely at the forthcoming spending review to check that the Secretary of State has been as good as his word.

 

What we see in the Statement yesterday and the Opposition’s response is a playing out of the traditional distrust between the two parties. The Government seek to assure the Opposition that they will not dilute workers’ rights post Brexit. However, I agree with Labour that the Statement does not provide all the protections that would guarantee that workers’ rights will not fall behind those enjoyed by workers in the European Union.

 

In the Commons yesterday Opposition spokesperson Rebecca Long Bailey, and the noble Lord, Lord McNicol, this afternoon, made the telling point that the promise given by the Government does not apply to secondary legislation, which could allow each existing EU-derived right to be watered down with ease. This latest move has been described as a cynical attempt to buy off wavering Labour MPs from leave constituencies so that they can justify voting with the Government on the EU withdrawal and implementation Bill. We on these Benches will not fall for it and the Government have a long way to go yet to satisfy a distrustful Labour Party.

 

The arithmetic does not yet stack up in the Government’s favour and, as things stand, they are destined for another whopping defeat in the Commons next week. The only way to guarantee that British workers’ rights keep parity with those of European workers is for Britain to remain within the EU. Why do not Labour and the Government realise that it is in the interests of all the people they represent to give them a say and back a referendum on the deal?

I remind the noble Baroness, Lady Burt, that we have had a referendum which quite clearly stated that the people of this country wished to leave the EU, and there is no point in trying to readdress that question. 

 

My right honourable friend made an announcement about how we will continue to protect workers’ rights in the future, and I am grateful that the noble Baroness took, to start with, a reasonably positive approach to this, agreed that we had a proud record in this area and welcomed his announcement about enforcement. I note what she said about examining carefully any future announcements about the level of resources. No doubt we will come to that in future business.

 

I am afraid the noble Lord, Lord McNicol, took—probably under orders—a less positive approach to my right honourable friend’s announcement. I do not accept a lot of what he said or the somewhat negative remarks that I also heard the general secretary of the TUC, Frances O’Grady, make on the radio yesterday morning. I think she and the noble Lord are being very negative. I give an assurance that there have been considerable discussions with MPs on his side of the House and with trade unions, as the noble Lord knows. He will know that my right honourable friend has regular meetings with individual unions and the TUC. He has committed to bring forward legislation to hold the Government to account for non-regression on these rights.

 

The noble Lord thinks there is no guarantee of no reduction in rights. He seems to have very little faith in Parliament being able to achieve those things. He might prefer to leave these matters to the European Court of Justice or to what is going on in the EU. I stressed that our rights here go well beyond anything that has ever emerged from the Commission. We will continue that, and we have set in place a process that will allow Parliament to provide proper scrutiny of the processes and the rights of workers, taking into account the needs of employers and of those who are not working but are seeking work to make sure that the labour market works for them and provides them with jobs. 

 

The noble Lord also wanted to know a little more about the scope of these measures and what will be included. I assure him that TUPE will be covered and make clear that the equality framework directive and other equalities directives, where they relate to non-discrimination, equality and work, will also be covered. Working time and holidays, including the working time directive, will be covered. Directions providing protections for part-time, fixed-term and young workers will be covered, and I could go on. My right honourable friend has made it clear that we want to cover all employees and provide protection for them, and to allow Parliament appropriate scrutiny of these matters.

My Lords, I thank the Minister for his Statement. We need to remember that trade unionists do not all vote for the Labour Party. More than 30% of them vote for the Conservative Party. Furthermore, statements by the TUC are capable of selective quotation, so I shall selectively quote from Frances O’Grady’s statement:

 

“successive UK Governments have been exceptionally resistant to introducing improvements even when they are required to do so by the EU”.

 

Those of us who have been fortunate enough to serve in the European Parliament will remember the blizzard of letters that we received from such people as the noble Lord, Lord Mandelson, imploring us to oppose the working time directive. I make the point that both parties have form in this matter and that when I asked a leading trade unionist a few ago to name me one significant advance that he had from 13 years of Labour government, he could not name one.

Ask the Minister a question!

I will ask a question. In repeating the Statement, the Minister said: 

 

“Parliament will be given the opportunity at least every six months to consider any changes to EU workers’ rights”, 

 

 

and so on, and referred to,

 

“a document which has been subject to consultation with employers and trade unions, and which will be scrutinised by the relevant Select Committees of this House”—

 

meaning the House of Commons. Can he give us any more enlightenment on whether there will be any opportunity for this House also to scrutinise these documents? We are, after all, a bicameral legislature.

My noble friend has made a number of points very well, particularly the fact that not all trade unionists vote Labour. He also referred to remarks made by Frances O’Grady, the general secretary of the TUC. I think Frances O’Grady is absolutely wonderful; it is just that we do not necessarily always agree on every matter. She took rather a negative approach to my right honourable friend’s announcement. I assure my noble friend that a document will be produced by the Government every six months after consultation and it will refer to any changes made in the EU. We might want to consider whether we wish to follow those changes, do something better or reject them for whatever reason. My noble friend referred to how they would be examined by another place. I am sure this House will find ways of examining them, just as another place will.

My Lords, Frances O’Grady certainly does not need any defence from me. She very much reflected the trade union mission in life, which is always to seek more—one word: more. Some business schools could learn from that mission statement. This is an astonishing change from the Government. We have been faced with a stream of anti-union and anti-worker legislation from them and their predecessor, and I can now see a change. It is not a huge change, and the motives for it are extremely murky in terms of next week’s vote and so on, but I ask the Minister to confirm two things. First, how does he see the role of trade unions going forward? Will there be an institution in which they will be involved to make sure that everything announced in the other place yesterday happens? Secondly, I would like him to repeat—I shall savour the moment—that the Government have no intention of changing the working time directive.

My Lords, I imagine that Frances O’Grady would not want to be defended by me. I merely said that I did not agree with her on certain matters but that I thought she was wonderful in many other respects. The noble Lord said that he always wanted more. Lots of people always want more but it is important to get the right balance so that, as my right honourable friend made clear, we protect the rights of those in work, we do not impose excessive burdens on employers and we create a situation in which it is easy for those who are not in work to find work because work is available and employers want to employ people. That is something that unions should always remember. Although they are assiduous in looking after those in work, they should remember those who are not in work, and we want to create the right environment for them. 

 

The noble Lord then asked whether there would be an institution involving trade unions. I cannot commit to creating any institutions; nor do I think it necessary to do so. What is important is that my right honourable friend, or whoever holds that office or is in government, has an open-door policy whereby they can continue to consult, talk to and have a dialogue with trade unions and all others who have an interest in the matters we are talking about. 

 

Finally, just because the noble Lord wanted to hear me say it, I was asked to make it clear that we have no intention of getting rid of or watering down—I cannot remember the precise words he used—the working time directive. I can give him that assurance.

My Lords, I am sure we are all glad of that last assurance from my noble friend the Minister. I thank him for making the point so effectively that the most fundamental right of workers is the right to be able to work. It is therefore crucial—I hope my noble friend will agree—that we leave the European Union with a proper deal, which will not jeopardise much of the remaining manufacturing capacity of this country as well as service and other industries. Does he agree that this is fundamental, and that it is therefore crucial that a deal is produced next week which can command the support of the other place?

My noble friend is quite right to talk about the fundamental right to be able to work. That is why we consider it very important, for example, that employers have the right to hire and fire. If one restricts the right to hire and fire—as we find if we look at, say, our neighbours in France—employers are less likely to want to take people on. As my noble friend and I made clear, we should consider the rights not only of those in work but of those seeking work. I confirm to my noble friend that we very much hope we will get a deal next week that our colleagues in another place will feel able to endorse, and that they will back my right honourable friend the Prime Minister.

My Lords, I suspect that this is an occasion when we must be grateful for small mercies. We are grateful that, at last, for whatever reason, workers’ rights have got on to the Government’s agenda. But if the Government really want to deal with workers’ rights and make the workplace more habitable—a place of co-operation and commitment—they need to get rid of a lot of the issues that prohibit such an environment, which we could all share, work for and develop. 

 

I notice that the Statement says nothing about zero-hours contracts—not a word. One problem currently affecting British industry and workers’ contributions to productivity is the so-called gig economy—here today and gone tomorrow. When we talk about workers’ rights it is in the context of family, but there is nothing here about family: nothing about mothers, and indeed fathers, having the opportunity to take time off to take the children to school or to hospital; and nothing to ensure an environment that combines work, community and family. It is a tripartite relationship, but nothing was said on that. We welcome what has been said so far but we hope that, when the Government return to this House, it will be with a more positive and enduring attempt to make life in the workplace better than it is today.

I am sorry that the noble Lord takes a faintly negative attitude to the announcement we have made today, particularly in the light of all that we have done—and propose to do—to improve conditions at work. I refer the noble Lord to the report we commissioned from Matthew Taylor. That report made recommendations; I forget the precise number. I will say that there were 59 and we accepted 58, although I cannot remember what the 59th, which we did not accept, was. We have taken all those recommendations on board. We will be bringing forward further legislation—after the legislation that I have been talking about, which will come with the withdrawal agreement Bill—to deal with the recommendations in the Matthew Taylor report and other matters.

 

I am sorry that the noble Lord comes back again to zero-hours contracts. That was something that Matthew Taylor looked at; he recognised that they serve a very useful purpose in certain conditions and saw no case whatever for legislating against them. Again, that is one of Matthew Taylor’s recommendations that we accept.

My Lords, one should not ignore the contribution that the European Court of Human Rights has made in the development of workers’ rights, particularly for part-time workers, for whom significant changes have been made as a result of rulings by that court in the interpretation of measures passed in the European Parliament—directives, regulations or whatever they may be. Can the Minister assure us that, in the process described in the Statement, account will be taken of developments through the court in the interpretation of the measures which are to be looked at in the process we have been told about?

I can tell the noble and learned Lord that we are delighted that we will no longer come under the influence or aegis of the Court of Justice of the European Union, but obviously we will still take note of judgments of the European Court of Human Rights, just as we always have.

If I may, I remind the Minister that it is the European Court of Justice which interprets the European legislation I am talking about; it has nothing to do with the European Court of Human Rights.

I am terribly sorry. I misheard the noble and learned Lord and thought he was referring to the European Court of Human Rights. We will continue to take account of that. We will no longer be bound by the European Court of Justice—the ECJ—but we will take note of any judgment from it. However, it will be for Parliament to make decisions about that because obviously we will no longer be bound by the European Court of Justice.

My Lords, it is helpful that the Government have today published the clauses to be inserted in the withdrawal Bill that deal with these matters. However, there are only 12 sitting days left for that Bill to pass through both Houses and none of the other clauses of that Bill have yet been seen by anybody outside the Government. How are the clauses to which the Minister referred to be adequately scrutinised in the two Houses?

My Lords, how we deal with the withdrawal agreement Bill is a matter beyond my pay grade. The department that I have the honour to represent in this House has published the clauses that we are talking about today. That gives time for some scrutiny of them in advance of the publication of the full Bill and I hope the noble Lord and others will make use of that.

My Lords, we do not need a crystal ball when we have the history books. I spent 26 years as a Member of Parliament in the other place. Every Bill or proposal to improve workers’ rights put forward by the Labour Government, and every argument we made to protect workers against employers, was opposed by the Tories, including the national minimum wage. When there was a Tory Government, the only improvements came because the European Union insisted on them. Why should we accept these warm words from the Government now, when we know the record of all these past years?

I have to say that that is complete and utter nonsense and I totally reject—

I was there, but the Minister was not.

I have been in this House long enough to see what goes on. I think I have been in this House slightly longer than the noble Lord was in another place. Conservative Governments have brought forward a great many improvements. My right honourable friend listed those in his Statement earlier, starting with the Disability Discrimination Act 1995, brought in under John Major’s Government by my noble friend Lord Hague. Look at the national living wage. Conservative Governments have done a great deal. My right honourable friend went back as far as the Shaftesbury Acts two centuries ago. We have made improvements and will continue to do so, but we will make sure we get the right balance.

My Lords, my noble friend talked about history, as has the Minister, but we also need to consider what the future will look like. Can the Minister understand why there are some suspicions in the labour movement and the trade unions about the intentions of a post-Brexit Conservative Government when so many of his colleagues have held out the vision of a low-regulation, low-cost economy competing with employers across Europe and the world? The whole point about European legislation is that employers cannot undercut each other on workers’ rights, yet the Minister himself briefly made a slip when he referred to the relative situation in France against that in Britain. That shows the psychology of some elements of his party in how they see the future. I should like an assurance that that is not likely to be the official policy of a Conservative post-Brexit Government, if such there be.

Would the noble Lord like unemployment levels at the same rate we see in France, or would he prefer to see employment and unemployment levels at the rates we have in this country, where we also have the right sort of protections for workers but do not have inappropriate protections that prevent people getting jobs?

My Lords, the Statement refers to the intention to establish, 

 

“a new body to bring together the relevant enforcement functions”,

 

of the gangmaster agency and others. The Minister did not give the exact position in his response to my noble friend. There is an opportunity for a new body to have trade union representation. Can he confirm that that will be under consideration?

 

My main point relates to two things. First, the gig economy has been raised. Is it in the Government’s mind to eliminate once and for all the gap between “employees” and “workers”, which has bedevilled many of the issues we have been talking about? There is a need to make sure that all workers are employees so that they can have the rights and protections the Government are now bringing forward.

 

Secondly, on the new body, is this not the time to bring in some of the other issues that have affected workers’ rights, such as giving the Small Business Commissioner statutory powers under this new body? Also, would it not be sensible, as is perhaps alluded to in the Statement, to bring in the enforcement body that the Treasury operates for flagrant breaches of the low pay regulations, including the national minimum wage and the national living wage? They should also be part of the same body.

I think the noble Lord will find that my right honourable friend referred to HMRC as one of the bodies that might be brought into some new enforcement body. As he made clear, it is a matter for consultation. We will want to consider what possible arrangements we can come to, but I cannot go any further than that at the moment.

 

The noble Lord also asked about dealing with the problems of the definitions of “worker” and “employee”. It is quite difficult. I can go as far back as when I was sitting the Bar exams a very long time ago. I found it quite difficult then; it is still difficult, but it certainly needs to be considered. No doubt that is something we can consider in due course when we come to legislation following Taylor and our Good Work Plan.