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The Tribunals Service will revise its procedures for listing cases if the fixed periods for conciliation are abolished, as is provided for in Clause 6. It may be possible to list some cases for an earlier hearing than at present. Who would be against that? Hearings are listed as soon as practicable, given the need for work to be done in case management discussions and otherwise to elucidate the issues in the claim, and the practicalities of timetabling all the cases where hearings are required.
I hope that I have reassured noble Lords that the administrative mechanisms already in operation are working and will be further refined should Parliament approve the provisions in the Bill. That will enable just outcomes to tribunal cases as quickly as is practicable. There is no need for the additional mechanism proposed in the amendment. It would create administrative confusion if it served to require the prioritisation of cases where conciliation had been tried and had failed, and where the claimant pressed for a quick resolution at tribunal. It could also create an incentive to engage in conciliation without a sincere wish to resolve the case, perhaps merely to delay things or in the hope that people got fed up and went away. Doing so would enable the listing of the case to be expedited, which is surely in the best interests of everyone. It does not make sense to create a system where certain cases could be accelerated at the request of a well informed claimant. Tribunal resources are finite; this would hold back consideration of cases where the applicant did not know to press for an early resolution. I repeat that I sympathise with the intention behind the amendment, but the results would not be workable.
Baroness Perry of Southwark: In the light of what the noble Lord, Lord Wedderburn, said, I ask whether “within reasonable time” would not have been a more useful wording. Courts are very used to dealing with reasonableness, whereas “without delay” is extremely difficult to define or prove, as my noble friend said. If the amendment is to be pursued, perhaps “within reasonable time” might be more appropriate.
Baroness Turner of Camden: I thank the Minister for that response. I am glad at least that he accepts that it is absolutely necessary that tribunal cases should be heard as quickly as possible, although
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Amendment, by leave, withdrawn.
Lord Wedderburn of Charlton moved Amendment No. 21:
The Secretary of State shall make regulations by order providing for improvement in the status of workers in employment disputes who are supplied or engaged by an employment business or employment agency.”
The noble Lord said: Amendment No. 21 falls within the provenance of the Bill because it concerns the position in disputes of a particular class of persons who at the moment are unjustly treated. The purpose of the amendment is to improve the status of workers supplied to work for an end user by an agency. As Lord Justice Mummery said, in a judgment on 5 February this year, to which I shall return:
“There has been an explosion of numbers in the workforce engaged to work under arrangements with employment agencies”.
He estimated the total number to be 1.3 million. Another estimate used, especially in the debate on the employment of agency workers in the other place last Friday—which I hope all Members of the Committee will read—is 1.4 million and there is evidence to suggest the figure is 1.4 million and rising. In other words, workers are being taken on as persons supplied by an agency. The president of the appeal tribunal, Mr Justice Elias, has recently said:
“Many agency workers are highly vulnerable and need to be protected from the abuse of economic power by the end user”.
He went on to suggest that a legislative solution is “urgently required”.
This amendment has two perspectives. The first perspective encourages the Minister to make regulations in the triangular relationship in which an agency worker finds him or herself. There are three aspects to the triangular relationship. The first is a contract between the agency and the worker, which is usually stated in terms not to be a contract of employment; it is a contract to supply labour. The second aspect is a contract between the agency and the end user—the employer, in conversational terms—which is not a contract of employment, but merely a labour-supply contract. There is no question of an employment contract there. Thirdly, we have the relationship between the worker and the end user.
My noble friend Lady Turner will deal with the triangular relationship in regard to real temporary workers; I wish to concentrate on agency workers who stay at the same point of employment—again I use a
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This month the Court of Appeal in the case of James v Greenwich Council decided that those judges who had said they would infer a contract of employment between the contract worker and the agency and the end user, of which there is quite a history of judgments suggesting that is what the courts should do, gave business-reality to the relationships because the agency worker is working side-by-side with permanent employees, very often on inferior terms and without employment protection rights. The Court of Appeal unequivocally rejected that approach and held that judges must not imply a contract of employment between the end user and the worker unless it is necessary on facts.
Miss James had worked as a care staff support worker at the same workplace for more than three years. She was provided to the council by an agency and paid by means of a payment from the council through the agency to her. The end user paid more than the wage because the agency had a slice of the payment. She was provided to the council by the agency and paid in that way. She carried out her work according to the instructions and control of the council—that is usually one of the tests of an employment relationship in the legal, technical sense—and was on the same rota as permanent employees. She wore a badge describing her as a permanent staff member, but she had no express contract of employment with the end user, Greenwich Council. She was off sick for a while, and when she returned, the council abruptly told her that she was no longer required as it had replaced her. After three years, she was naturally somewhat amazed at that and claimed that she had been unfairly dismissed.
The first hurdle that such a claimant needs to surmount at the tribunal is to show that she worked under a contract of employment, otherwise she has no rights in respect of unfair dismissal, which Miss James alleged this was. The council denied that she was an employee in any legal sense. It said she was an agency worker who was, in legal terms, self-employed. The court refused to imply any contract between Greenwich Council and Miss James, and in its judgment the Court of Appeal said that that must be the pattern applied in future cases to agency workers working, even for long periods, for the same employer. The court went on to say that a contract of employment can be implied to give business efficacy to the case, but only in a very rare instance. Lord Justice Mummery declared that the test of the necessity must be imposed on this relationship between end user and agency worker. He said that proceedings in the tribunals concerning the disputed legal status of agency workers had been put on hold in a large number of cases awaiting judgment in the tribunals. He directed the tribunals to approach the long list of cases on hold to apply this test.
That means that many thousands of workers—an increasing number—who have worked at the same workplace for years, but who are supplied by an employment agency will not qualify for basic
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5 pm
There is a second perspective to the amendment. The Minister arguably has a power already to make such regulations, improving the law on workers supplied by an agency. The amendment could be seen as a wake-up call to use those powers, which derive from Section 23 of the Employment Relations Act 1999. That gives to the Minister power to extend certain employment rights, including the unfair dismissal and various similar rights, to a “specified description” of workers, who might not ordinarily be seen as working under a contract of employment, and to clarify who is the employer. The Minister has remarkable powers under Section 23 and the amendment made to that section in Section 41 of the Employment Act 2002 does nothing to make that power irrelevant to this point in the argument.
A decade ago, Lord Justice Buckley said in the case of Montgomery v Johnson Underwood in 2001 that further consideration for the status of agency workers must be given by government and that,
- “the power conferred by section 23 of that Act on the Secretary of State ... to extend the protection of employment legislation to a specified description of individuals might be put to important use in this respect. Continued confusion about whether there exists any protection”,
Our amendment gives the Government a splendid opportunity to say that it is unnecessary to accept it because powers already exist to improve the situation under Section 23. I am aware that there is a draft of the European directive, on which I am not relying—but if your Lordships read the debate in the House of Commons of last Friday, it is a central feature in improving the lot of those workers, on which more than 150 Members of Parliament in the other place were prepared to vote as something that was required.
The James judgment makes government action even more urgent. We now know that the triangular structure for agency workers deprives hundreds of thousands of workers of basic employment protection rights. Maybe we can reach some agreement on that European draft
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To move the position forward, for the reasons that I have given, I beg to move.
Baroness Turner of Camden: During Second Reading, many noble Lords referred to the need to provide employment rights for agency workers, many of whom are vulnerable and often extremely exploited. The TUC briefing drew attention to the need to provide such protection. A Private Member’s Bill, the Temporary and Agency Workers (Equal Treatment) Bill, has had its Second Reading in the Commons. It proposes to give the 1.4 million temporary and agency workers the same protection that applies to permanent staff. Workers of this type have existed for a long time, particularly in the construction industry, where they have been viewed as being employed on individual contracts and therefore as self-employed, thus exempting the employer from providing the sort of employment rights and protection, including health and safety, that would otherwise be necessary. Nowadays, many are immigrant workers, as has already been explained by my noble friend Lord Wedderburn. Often employed via an agency, they are frequently very anxious to secure work and willing to accept lower pay and conditions, thus undermining the pay and conditions established in the relevant industry. There has been a growth in casualisation, which has now become quite a business in itself.
The unions backing the Private Member’s Bill, which include my union, Unite, have undertaken substantial research into the conditions suffered by such workers. The results indicate a truly appalling level of exploitation. Many such workers had been promised reasonable rates of pay and decent accommodation but they actually got neither. The accommodation is often very crowded and, in some instances, unsafe, without proper fire protection. The agency will often claim to stay on the right side of the minimum wage provision by deducting charges from the pay towards the unsatisfactory and inadequate accommodation or for the minibus which takes the workers to and from work. If they get ill, they get sacked immediately. All report a deep sense of insecurity. This is an extremely insecure and exploited workforce.
As I understand it, the Bill in the Commons has a double purpose: to protect non-agency workers being undercut by cheaper, temporary labour and to prevent vulnerable workers being exploited by unscrupulous agencies. Agency staff are employed systematically across the public sector, in the NHS
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There seems to be a feeling that the flexibility which the Government think is so important would be threatened by giving agency and temporary workers the same protection as permanent staff. I am sure that most people would support flexibility for people with young children and particularly for those with caring responsibilities, but what we now have for these 1.4 million people would appear to be disposability rather than flexibility. It enables unscrupulous employers to get work done on the cheap—to the great disadvantage of the employees, including permanent employees, whose rates of pay can be undermined by the existence of such a workforce. It is flexible from the employer’s point of view but exploitable from the view of the workforce.
I should like to see the Government accept the argument that my noble friend Lord Wedderburn and I have set out this afternoon and move the situation forward. I support the amendment.
Lord Campbell of Alloway: With the greatest respect to the noble Lord and the noble Baroness, I oppose the amendment. I accept the problem as recognised by the judiciary by convention and I accept the erudite exposition of the noble Lord, Lord Wedderburn, but this is without the Long Title of the Bill. Of course, there is a problem with these agency workers and, as the noble Baroness said, the matter is receiving attention in another place. However, the Long Title of the Bill is concerned only with the,
That assuredly has nothing to do with what we are told is the triangular status of these agency workers, which of course I accept. The problem cannot be addressed in this Bill, because it goes totally beyond its ambit. The matter has previously attracted the attention of the noble Lord, Lord James of Blackheath, in your Lordships’ House, who has spoken to the matter forcefully. He was very concerned by the problem of agency workers. Amendment No. 25 contains a reference to his concern, reflecting what he said in your Lordships’ House. I am in no sense trying to get at the merits of the argument. A serious problem has to be addressed, but assuredly not by this Bill. At least, that is what I suggest.
Lord Wedderburn of Charlton: Would the noble Lord accept, first, that the James v Greenwich Council case concerned a dispute as to the rights of the worker, and, secondly, that the Long Title of the Bill states that it is a Bill to,
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It is not just about enforcement; it is to do with the resolution of employment disputes. The noble Lord said that agency workers are outwith the scope of the Bill, and it is the job of your Lordships’ Clerks to suggest that this is so. In putting down the amendment, I made reference to that part of the Long Title. It is right to accept it and not throw it out on the technical ground that it is outside the scope of the Bill.
Lord Campbell of Alloway: We are not in the Appellate Committee; I shall certainly not start a technical argument with the noble Lord. However, the noble Lord distorts the Long Title. I accept that it is concerned with providing for the right of trades unions to exclude members, but it is not concerned with the enforcement of an offence.
Lord Razzall: Perhaps I may intervene for the first time in the one hour and 40 minutes that we have spent on three amendments, which always happens when we get into the hands of the barristers. I support the noble Lord, Lord Wedderburn, in what he said on the procedure. I bow to no one in my respect for the noble Lord, Lord Campbell of Alloway—apart from in the damage he does to microphones. I have listened to him for the past 12 years in your Lordships’ House say that amendments are not valid because they do not conform to the Long Title. Those of us who have sat through 28 pieces of employment legislation will know that Her Majesty’s Government often put in provisions that bear little relationship to the general title of the Bill. If, as the noble Lord, Lord Wedderburn, indicated, his amendment falls simply because it does not meet that procedural requirement, it is not beyond the wit of the expensively paid people behind the Minister to ensure that it does.
At a more fundamental level, I wonder whether this debate is not a little premature. I heard on the radio this morning that a meeting between the Prime Minister and the trade union movement about this issue is being held in Downing Street as we speak. Would it not be better if the noble Lord, Lord Wedderburn, withdrew his amendment until we knew what our Prime Minister has decided to put forward in relation to this issue? Are we not in danger of having a theoretical debate when we do not yet know what He Who Shall Be Obeyed has decided?
5.15 pm
Lord Henley: It is a very interesting constitutional point that we cannot discuss anything until the Prime Minister has decided whether it is appropriate for us to discuss it. I make two or three small points. First, I support what my noble friend Lord Campbell of Alloway said when he doubted that this was within the ambit of the Long Title. It might be, but my noble friend was saying that it is not quite within the spirit of the Bill. I would like to offer one small bit of advice to the noble Lord, Lord Jones, for when he winds up. The amendment proposed by the noble Lord, Lord Wedderburn, and the noble Baroness, Lady Turner, comes from the fact that both noble Lords do not like agency workers—the idea of
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One should emphasise the fact that for many employees there are considerable advantages in being agency workers and suchlike. I would have thought that the simple solution for the Minister is to reject the amendment because it is simply designed to make it much harder for people to seek employment as agency workers or as temporary workers. The same should apply to the Private Member’s Bill that was discussed in another place last Friday. No doubt the noble Lord will give the Government’s view on that and on this amendment in due course.
Lord Razzall: I make it clear that of course I was not suggesting that because the Prime Minister is discussing the matter today that it is outside our ambit to discuss this at all. I was suggesting that no one knows what will happen in the negotiations between the Prime Minister and the trade union movement. We do not yet know whether the point the noble Lord, Lord Wedderburn, made, as reflected in the amendment, will be agreed by the Government. We are asking the Minister to make a comment on the amendment of the noble Lord, Lord Wedderburn, before he knows the result of the negotiations between the Prime Minister and the trade union movement. Therefore, in order to expedite the passage of this Bill, would it not be better to postpone the debate until Report, when we will know better what has occurred at Downing Street today? That is all I was suggesting.
Lord Henley: I do not accept that point. It is perfectly legitimate for us to discuss the matter in advance of the Prime Minister and the trade unions reaching their conclusions.
Lord Watson of Invergowrie: I support the noble Lord, Lord Henley, on that point, although, I make clear, on nothing else that he said. The noble Lord, Lord Razzall, may be relieved to hear that I am not a barrister, a lawyer or legally qualified at all like most of the contributors to the debates this afternoon. Like the noble Baroness, Lady Turner of Camden, I worked for the same trade union as her and at the same time, and took many industrial and employment tribunal cases. Therefore, I feel that I have a strong view that how the Bill is framed will not entirely meet the needs of those who seek to benefit from employment tribunals.
I say to the noble Lord, Lord Razzall, that the point he makes has some validity. Some discussions are ongoing. Indeed, a Private Member’s Bill is currently going through the other place. I wish Mr Miller all luck with it. At the same time arguments are to be advanced in favour of agency workers which I believe are germane to the Bill we are discussing. In response to the noble Lord, Lord Campbell, I say that surely the Clerks know their business well enough that if they felt this was outwith the scope of the Bill it would not be in the Marshalled List for us today.
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