16:35 - The House divided: - Ayes: 310 / Noes: 155 - Question accordingly agreed to.
16:49 - The House divided: - Ayes: 308 / Noes: 153 - Question accordingly agreed to.
17:00 - The House divided: - Ayes: 310 / Noes: 150 - Question accordingly agreed to.
17:12 - The House divided: - Ayes: 312 / Noes: 151 - Question accordingly agreed to.
17:24 - The House divided: - Ayes: 311 / Noes: 152 - Question accordingly agreed to.
The Parliamentary Under-Secretary of State for Business and Trade (Kate Dearden)
I beg to move,
That this House disagrees with the Lords in their amendment 1B.
Madam Deputy Speaker
With this it will be convenient to discuss the following Government motions:
That this House insists on its disagreement with the Lords in their amendment 23 and amendments 106 to 120, does not insist on Commons amendment 106A but proposes Government amendments (a) to (c) in lieu of Lords amendment 23 and Lords amendments 106 to 120.
That this House disagrees with Lords amendment 48B.
That this House disagrees with Lords amendments 60B and 60C but proposes Government amendments (a) and (b) in lieu.
That this House insists on its disagreement with the Lords in their amendments 61 and 72 but proposes Government amendment (a) in lieu.
That this House insists on its disagreement with the Lords in their amendment 62 but proposes Government amendment (a) in lieu.
Kate Dearden
I am pleased to speak on the Employment Rights Bill for our second consideration of Lords amendments, and I refer Members to my entry in the Register of Members’ Financial Interests. I thank my right hon. Friend the Member for Ashton-under-Lyne (Angela Rayner) for her outstanding work on employment rights and her unwavering advocacy for working people. I know how close this Bill is to her heart, and I am grateful that she is here in support today. I also thank my hon. Friend the Member for Ellesmere Port and Bromborough (Justin Madders) for his work and dedication on this significant piece of legislation.
The Government’s top priority is to grow the economy and improve living standards. Essential to that is the recognition that greater productivity, security and dignity in work help to grow the economy. The stronger economic performance that our country needs cannot be built on the backs of people in insecure work. For too long employment law has failed to keep pace with the fundamental changes to how, when and where we work. It is time to build a modern industrial relations framework, fashioned on the principle of social partnership that consent and consensus must replace disputes and conflict in modern employment relations. That is good for workers and good for business. Both suffer when one employer is undercut by another, using reduced terms and conditions of service for their employees. Sustainable economic growth cannot be built on unfair competition and insecure employment.
The Employment Rights Bill extends the employment protections currently enjoyed by some employees in the best British companies to workers across the country. By doing so, work will become more secure and predictable while strengthening the foundations that underpin a modern economy. The Bill will back businesses that already do the right thing and give hard-working people the job security and opportunities they deserve. It is in tune with the times and in keeping with how the world of work is changing.
Industrial relations law in this country must move from the 20th century to the 21st. It has to recognise that certainty and security are essential for people at work, that the best relationship between employer and employee is best exemplified by fairness and trust within a framework for recruitment and retention that values both, and that dignity at work is as vital to the effective functioning of modern society as the dignity of work.
Some will seek to use this issue to entrench the idea that employers and employees have opposing interests that must always inevitably result in dispute and strife, and I reject that view. The very best trade unionists know, as do the best employers, that such a view only represents failure. For this Labour Government, success is to be measured not in division, but in the shared economic growth that we achieve, the opportunity and security we build and the prosperity we create, and that is at the heart of the Bill.
Today I ask the House to reaffirm its support for this important legislation as we move through the latest round of parliamentary ping-pong. We have listened carefully to the concerns that have been raised, and in response we are offering, where possible, amendments in lieu that we believe strike a fair and workable compromise with the proposed amendments. Although we appreciate the range of perspectives offered, we will be unable to support certain amendments that conflict with the fundamental principles of the Bill and may compromise its intended impact.
We acknowledge that Lords amendment 1B, which relates to zero-hours contracts, is an amendment in lieu, intended as a compromise. It proposes a shift from a full right-to-request model to one in which employers must notify workers of their right to a guaranteed hours offer, and make a guaranteed hours offer unless the worker declines or opts out. I appreciate the sentiment behind the amendment, but it would undermine the Bill’s core aim of ending exploitative contracts and providing security for the workers who need it most. We therefore cannot accept it.
The Government are committed to ending one-sided flexibility so that workers are not left guessing about their hours or pay. These reforms reward fair employers, modernise the system and come with clear guidance to help everyone prepare. For employers, clear expectations mean better staffing and lower recruitment costs through better retention. We also appreciate that some groups, including younger workers, value the flexibility of zero-hours contracts. That is why workers will be able to decline a guaranteed hours offer and remain on their existing arrangement if that works best for them.
The Government are also committed to supporting young people into work. The youth guarantee will include a targeted backstop under which every eligible and unemployed young person on universal credit for 18 months without earning or learning will be provided guaranteed paid work. The scheme forms part of the Government’s aim to provide targeted support for young people at risk of long-term unemployment. Further details will be confirmed at the autumn Budget, following further engagement, including with employers.
Let me turn to Lords amendment 48B on seasonal work. The Government recognise that work in certain sectors fluctuates seasonally, and that there are ways in which employers may account for that and remain compliant with the legislation. They may, for example, use annualised hours contracts, which offer variable numbers of hours at work at different times of the year. Additionally, the Bill already allows guaranteed hours offers to take the form of limited-term contracts where reasonable—for example, a fruit-picker could be engaged on a contract tied to the end of the picking season. In such cases, after the initial reference period, the employer would be required to guarantee hours only for the duration of that limited-term contract rather than on a permanent basis. The Bill also already provides powers to address seasonal work through regulations, ensuring flexibility as workforce needs evolve. Consultation with employers, trade unions and stakeholders will take place before such regulations are made. We therefore do not support the amendment.
Let me turn to unfair dismissal. Lords amendments 23 and 106 to 120 propose retaining a qualifying period of six months for unfair dismissal. These amendments have returned to this House as the Lords have insisted on them. We remain committed to delivering unfair dismissal protections from day one—not two years, not six months, but day one. That was a clear pledge in our manifesto and it will ensure that about 9 million employees who have worked for their employer for less than two years are protected from being arbitrarily fired. Crucially, day one protection from unfair dismissal will not remove the right of businesses to dismiss people who cannot do their job or do not pass probation, but it will tackle cases of unfair dismissal in which hard-working employees are sacked without good reason. A six-month qualifying threshold still leaves employees exposed to dismissal without good reason in the early months of a new job, which is why the Government cannot accept the Lords amendments on maintaining a qualifying period.
James Wild (North West Norfolk) (Con)
Does the Minister not listen to the voices of business and business organisations? They say that what the Government propose will make young people—whom it is riskier to take on—less likely to get jobs in the first place. Why does she think she knows better than employers and the people who create jobs in this country?
Kate Dearden
Yesterday, I was with the Hospitality Sector Council. I heard about all the brilliant work it does to provide employment opportunities for young people across the country. Indeed, my first job was in a café. Such opportunities to get on the employment ladder are significant for young people. That is why the Bill will work in alignment with all the other crucial work that the Government are doing through the youth guarantee.
As I have outlined on unfair dismissal, it simply is not fair that hard-working employees who have worked somewhere for 18 months can be unfairly dismissed and have no stability and predictability in their jobs. Protection through day one rights gives financial security to people who do not have it. We are striking a balanced approach by introducing a statutory probation period. As we have mentioned, the Government’s preference is for that to be a period of nine months, but we are engaging in consultation on the next steps for those light-touch standards. The probation period will ensure that in the early months of employment, employers can dismiss employees who might not be performing or might not be suitable. The measures will tackle the causes of unfair dismissal.
Ian Lavery (Blyth and Ashington) (Lab)
Some 73% of employers support giving employees protection from unfair dismissal—the day one rights—according to the Institute for Public Policy Research and TUC research, and 83% of managers agree that improved workers’ rights can and do positively impact on workplace productivity. Does my hon. Friend agree that we should listen to that extremely important research?
Kate Dearden
My hon. Friend raises an excellent point about research. Providing employees with security at work results in a happier workforce, which increases productivity and helps businesses across the country, as well as our economy. The Bill will provide flexibility and security for people in workplaces across the country, which is vital for our productivity. That is our vision for our country and economy.
James Wild
The Minister referred to a nine-month probationary period as opposed to the six-month unfair dismissal period. A report from the Resolution Foundation—which is usually held in high regard on the Treasury Bench—says that this is a “messy compromise” that risks confusing employers and preventing them from taking people on. That is the point that I was making. Some 20% of jobs in my constituency are in the hospitality sector. The sector is not taking people on because of the jobs tax, and it will take on even fewer people because of these increased costs. Does she not realise the confusion that will come from this messy probation period, which is not on the face of the Bill?
Kate Dearden
As we have said from the start, the implementation of day one unfair dismissal rights will be done with a light touch. I am keen to work with employers across the country, including in the hospitality sector, which plays a key role in employing and providing opportunities for young people. I will work with all stakeholders on the next steps and implementation. As the hon. Gentleman knows, and as is the case for lots of employment rights legislation, we are setting the foundation here in this crucial Bill, but there are lots of details to work through in consultation, which I am absolutely committed to doing.
The framework will be founded on the principle of social partnership: consent and consensus must replace dispute and conflict in modern employment relations. That will ensure maximum flexibility, so that the new framework works effectively for employers and employees in each sector of the economy. We will minimise the cost of its implementation and operation.
The Government are committed to ensuring that employers can hire with confidence. As I have said, introducing the statutory probation period enables employers to fairly assess new hires’ performance and suitability for the role that they have been hired for. Most employers already use contractual probation periods of six months or less. The Government have been clear that our preference is for the probationary period to be nine months long. That would allow for a standard six-month term, with the option to extend supporting employee development without compromising operational needs.
We have heard the calls to ensure that the framework reflects real-world realities, and we have tabled an amendment in lieu to address that. Our amendment places a statutory duty on the Government to consult on key aspects of the framework. That would guarantee meaningful input from employers and employees, giving businesses a direct role in shaping the legislation to ensure a practical and fair approach. Additionally, we are tabling a further amendment in lieu, making technical changes to the words restored to the Bill by our rejection of the Lords amendments.
Naushabah Khan (Gillingham and Rainham) (Lab)
Does my hon. Friend agree that the Bill not only provides vital protections to the workforce, but gives businesses the certainty they need to grow our economy?
Kate Dearden
I completely agree. We are creating security for people across the country. Crucially, we are ensuring that employers do the right thing for their employees and go above and beyond the proposals in the Bill. That ensures a level playing field, which is good for our economy and for businesses that might otherwise be undercut by others that do not play by the rules.
We have also heard concerns about the pressures on the employment tribunal system. We will set up a taskforce to support us in fixing the employment dispute system, so that it works better for workers and businesses. The taskforce will have balanced representation from unions, businesses and other experts, including community organisations.
I turn now to the Lords amendments on heritage rail. The Government agree with the principle of the amendment and have tabled an amendment in lieu that captures the intent, while refining the drafting to provide more clarity and ensure that the legislation works as intended. The Government’s amendment, which has been tabled with the support of sponsoring peers Lord Parkinson and Lord Faulkner, places a statutory duty on the Office of Rail and Road and the Health and Safety Executive to produce guidance supporting 14 to 16-year-olds who volunteer on heritage railways.
Liz Saville Roberts (Dwyfor Meirionnydd) (PC)
I rise as co-chair, alongside Lord Faulkner, of the all-party parliamentary group on heritage rail. I express my thanks to the Government for bringing forward the amendment and recognising that volunteering with heritage railways is an immensely useful experience for young people aged 14 to 16. I am glad that we are now undertaking a 12-month assessment for guidance.
Kate Dearden
I thank the right hon. Member for working with us and for her support throughout the passage of the Bill. I understand her passion and work in this area. As she says, the guidance will offer a clear benchmark for reasonable activities and assist inspectors in important decisions. The Government are committed to the work, as she will know, with publication targeted by 31 March 2026. We believe that this collaborative effort will provide practical guidance that empowers children to engage safely and meaningfully in heritage railway volunteering.
Turning to the issue of political funds, Lords amendments 61 and 72 would remove clause 59 from the Bill. That clause reverses measures in the Trade Union Act 2016, which we have committed to repeal, that require members to opt in to political funds. This therefore reinstates longstanding arrangements where members are automatically included unless they choose to opt out. Removing clause 59 would break that commitment to restore balance and fairness in union operations. The opt-in system, introduced in 2016, added bureaucracy without improving transparency or strengthening members’ choice. To be clear, we are not removing that choice. At the point of joining, every new member will be clearly informed on the application form that they have the right to opt out of contributing to a political fund. The same form will make it plain that opt-out has no negative bearing whatsoever on any other aspect of union membership. That is why the Government cannot support Lords amendments 61 and 72.
We have heard reflections around how opt-out notices would take effect and have tabled an amendment in lieu to refine that process. Under the pre-2016 legislation, an opt-out notice was effective on 1 January following the year in which it was given. Under the Government’s amendment, opt-out notices will now have effect from either 1 January or the following year after it has been provided, or on a date specified or determined in the rules of the union, whichever of those dates comes first. This provides unions with flexibility in the legislation to act more quickly and process the member’s request to opt out, without having to wait until the subsequent 1 January to do so. In practice, unions already do this. We will also commit today to engage with unions directly, to continue to make clear our expectation that opt-out notices can be honoured as swiftly and practically as possible. Our amendment is simply about ensuring that legislation matches what has been the established practice.
Jim Shannon (Strangford) (DUP)
I hope that the Minister has not referred to this already, but small businesses in my constituency that do not have human resources departments tell me that they will find it hard to navigate these legislative waters. Although we need strong employment rights and I support the Bill’s objectives, we need to ensure that there is support for employers, so that they know how to implement the measures and how to defend themselves, which they will sometimes need to do, without paying costly solicitors’ bills that are detrimental to their business. Will the Minister reassure me on that matter?
Kate Dearden
I come from a family that has a business in the hospitality sector, which is close to my heart. In the first eight weeks that I have been in this role, I have had the pleasure to meet small and large businesses, and I have made clear our determination to work closely with them on the implementation of this legislation and to ensure that they are prepared for the changes when they come. We published our road map earlier this year and have committed to stick to that, which has been welcomed by businesses small and large.
Finally, turning to the issue of industrial action ballot thresholds, Lords Amendment 62 would remove clause 65(2) from the Bill, which would retain the existing 50% turnout threshold for industrial action ballots. The Government do not support this amendment. Clause 65 removes an unnecessary bureaucratic hurdle and aligns union democracy with other democratic processes, such as parliamentary votes and local elections, which do not typically require turnout thresholds but are still accepted as legitimate. As the period of disruption under the Conservatives’ watch between 2022 and 2024 has shown, bureaucratic hurdles only make it harder for unions to engage in the bargaining and negotiation that settles disputes. This Government’s approach will foster a new partnership of co-operation between trade unions and employers.
James Wild
If this provision is introduced, does the Minister think that there will be more or fewer strikes?
Kate Dearden
Strikes were a failure of the Tory Government who had stopped listening and, to be frank, had stopped working, so I will not be taking any further interventions from the hon. Gentleman.
We want to create a modern and positive framework for trade union legislation that delivers productive and constructive engagement, respects the democratic mandate of unions and works to reset our industrial relations. Nonetheless, we recognise that this issue has generated debate, which is why the Government have tabled an amendment in lieu that will require the Secretary of State to have regard to any effects of the introduction of electronic balloting on the proportion of those entitled to vote in industrial action ballots who actually do so. We have previously committed to aligning the removal of the threshold with the establishment of e-balloting as an option for trade unions. This amendment gives statutory effect to that commitment and makes it explicit in the underlying legislation. In having regard to the effects of e-balloting, the Government will monitor and assess the practical impacts of e-balloting on participant rates and the 50% threshold.
To conclude, I urge hon. Members to support the Government’s motions before the House today, including our amendments in lieu, which are part of a package that strengthens rights and reflects the value we place on fair work. We have listened throughout the Bill’s passage and made meaningful changes where needed, and we will continue to listen to all relevant stakeholders as we move into implementation We are committed to full and comprehensive consultation with employers, workers, trade unions and civil society. As set out in our “Implementing the Employment Rights Bill” road map, we are taking a phased approach to engagement and consultation on these reforms. This will ensure that stakeholders have the time and space to work through the detail of each measure, and will help us to implement each in the interests of all. This is a win-win for employers, employees and a more competitive British economy.
Andrew Griffith (Arundel and South Downs) (Con)
Act in haste, repent at leisure: never has that been wiser advice than in respect of this Bill. It is a rushed Bill that was half-baked when it was introduced, and has got worse since. It has failed every test of scrutiny, from the Lords Delegated Powers and Regulatory Reform Committee to the Constitution Committee, to its low-balled impact assessment.
On the day that the Mayfield report outlines the scale of the challenge that we face on worklessness, it will create generation jobless. Every family in the country will know a son, daughter, niece or nephew who cannot get work as a result. As my hon. Friend the Member for Mid Buckinghamshire (Greg Smith) reminds us, every Labour Government leaves unemployment higher than when they started, but only this Government have actually legislated for that.
The Minister asks us to disagree with all the main compromise amendments from the other place. If she wished to listen to stakeholders, now would be a fantastic moment to start. Her motions to disagree reject sensible compromises on qualifying periods, seasonal working, guaranteed hours, strike thresholds and opting in to political funds. Who will be the victims if the motions are carried today? Young people, the neurodiverse, those with a disability, female returners to work, the over 50s and former prisoners—some of the most vulnerable groups in society who deserve their chance in life, their shot at employment and a job.
Andrew Griffith
I should give way to the hon. Member for Ellesmere Port and Bromborough (Justin Madders), who did so much service on this Bill.
Justin Madders (Ellesmere Port and Bromborough) (Lab)
I am grateful to the shadow Secretary of State for giving way. I am pleased that he has learned to count now; he must have improved his skills since his time under Liz Truss in the Treasury. He talked about the consensus over 30 years, but was it not his Government who introduced the Trade Union Act 2016, which did so much to damage trade union relations?
Sarah Olney
The point has been made on a number of occasions that it is always possible for employers to make mistakes in their hiring—for people to not be the right fit for the job. There should be a straightforward way for those employers to dismiss those people without being challenged on the basis that the dismissal was unfair. The key point is not that employers should be allowed to make unfair dismissals, but if a dismissal has been fair, they should not have to defend it.
Justin Madders
The Liberal Democrat spokesperson has just said that it is not right that employers should pay for a mistake they made in hiring someone. Why should the employee pay for that mistake, if it was not theirs?
Sarah Olney
There is a balance between the employer and the employee. If the fit is not right, it is better for both sides that the employment is brought to an end, and that the employee is free to seek more appropriate employment.
There are very significant concerns. The lack of clarity about probation periods, which the Minister mentioned, and exactly what they mean, risks piling undue worry on to business managers who are struggling to find the right skills. We can compare that with the provisions in the amendment tabled on unfair dismissal.
My Liberal Democrat colleagues and I, both here and in the other place, have been clear in our support for an amendment that would change the obligation to offer guaranteed hours to a right to request guaranteed hours. Amendment 1B would allow an employee to notify their employer if they no longer wished to receive guaranteed hours offers, but they would be able to opt back into receiving guaranteed hours offers at any time. That reasonable and balanced approach would relieve employers from having to issue guaranteed hours offers each reference period to workers who may simply not be interested in them, while ensuring that those who wished to receive such offers could continue to do so.
The Liberal Democrats strongly believe in giving zero-hours workers security about their working patterns, and we are deeply concerned that too many workers are struggling with unstable incomes, job insecurity and difficulties in planning for the future. However, we also recognise that many people value the flexibility that such arrangements provide. Adaptability in shift patterns is often hugely valuable for those balancing caring responsibilities or their studies alongside work. It is therefore important to strike a balance that ensures that workers can have both security and flexibility.
Specifically, small and medium-sized businesses have highlighted that having to offer employees fixed-hours contracts on a rolling basis could impose significant costs and administrative burdens on their limited resources, compounding other challenges, such as the recent increase in employer national insurance contributions and the fallout from the previous Government’s damaging Brexit deal. The Liberal Democrat amendment that was debated in the Lords is in line with our long-standing policy that zero-hours and agency workers should have the right to request fixed-hours contracts—a request that employers could not unreasonably refuse. We believe that measure would maintain valuable flexibility and benefit both parties when the obligation to keep offering guaranteed hours, even to workers who clearly are not interested in them, imposes a significant burden that does not benefit either side.
As with all workplace rights, employees should be supported to exercise a right to request guaranteed hours without fear of any negative consequences in their workplace. The unified fair work agency being set up by the Government, which we welcome, could help ensure that employees received that protection and support. This approach would still give workers the vital security that they deserve, while avoiding unnecessary burdens for employers.
Last time the Bill was debated in the Commons, I spoke in favour of measures that would improve the clarity of the legislation on seasonal work, so I will once again speak in favour of Lords amendment 48B. The sustainability of so many companies, such as farming businesses, depends on getting the right people into the right place at the right time. Any obstacles to actioning that can have a huge impact on company operations, potentially throwing the entire business into jeopardy. Hospitality firms such as pubs, cafés and restaurants also rely on seasonal workers and are particularly vulnerable.
Madam Deputy Speaker (Ms Nusrat Ghani)
I call Justin Madders. After his speech, there will be a five-minute speaking limit for Back Benchers.
Justin Madders
Let me first draw attention to my entry in the Register of Members’ Financial Interests, which refers to an election donation from the Union of Shop, Distributive and Allied Workers, and to my membership of the Unite and GMB trade unions.
It is nearly nine months since the Bill completed its Commons stages and over a year since it was first introduced, so it is disappointing to see yet another delay. I know that many of my constituents would want these vital manifesto commitments to be enacted as soon as possible, but recent proceedings in the other place have demonstrated the intention of the Opposition parties to elongate the process and attempt to water down important protections that the Bill offers to workers. It is as simple as this: Labour Members were elected on a manifesto that committed us to making work pay, and the Employment Rights Bill is central to delivering that. It will be the biggest upgrade of workers’ rights in a generation. It is long overdue, and we will all be unashamed of our commitment to improving the lives of working people.
This Bill will have a transformative impact on the world of work, and particularly on people who lack job security and dignity. Make no mistake: at every single stage the Conservatives and Reform have voted to water the Bill down or weaken its protections, and now it seems that the Liberal Democrats have joined in. Our constituents will no doubt conclude that those on the Opposition Benches are siding with the bad bosses, and I urge them to reconsider and choose the side of working people. That is not an exaggeration, because the Lords amendments under consideration will gut the Bill of important protections for the millions of people currently in insecure work.
We do not have much time, so I will focus on Lords amendments 1B and 62 and Lords reason 120B, which I consider to be the most damaging amendments. Lords amendment 1B represents a continued attempt to undermine our commitment to banning exploitative zero-hours contracts. The Government, and Labour Members, have always been clear that the only way to tackle the most pernicious elements of such contracts is to make the right to guaranteed hours a right that people can genuinely exercise. Workers on zero-hours contracts are some of the least empowered in our economy, and the least able to actively assert their rights. Their working hours are inherently precarious and often depend on the vagaries of their bosses, and they are more likely to be younger and working in the lowest-paid sectors of the economy. Shifting this commitment to a “right to request” model, as the Liberal Democrat amendment suggests, would completely fail to recognise the power imbalance in the working relationship, and the real risk that assertion of rights would have negative consequences for those who just want some basic security and dignity at work. I am therefore pleased that we are rejecting those amendments.
Of course, that is not the only form of insecurity that those on the Opposition Benches want to keep on the table, as they support Lords reason 120B, which seeks to allow workers to be unfairly dismissed in the first six months of their employment. Maybe those in the other place, who have jobs for life, do not understand what it feels like to be tossed aside without any explanation. Maybe they do not appreciate how debilitating it can be for someone to go into work every day with the sword of Damocles hanging over their head, knowing that, if the chop comes, there will be absolutely nothing that they can do about it, but those bills will still need paying and their dependants will still depend on them. We need to drive out the insecurity that eats away at so many hard-working people in this country.
Laurence Turner
Is it not also the case that, within that graph, a number of the nations that the Resolution Foundation says have weaker protections actually have higher unemployment rates than our own? There is clearly not the relationship between the two that some in the Opposition have tried to suggest.
Justin Madders
My hon. Friend is absolutely right. Indeed, that is something that the Resolution Foundation said when giving evidence to the Bill Committee. I will quote that directly:
“Internationally, we can draw scatter plots of the employment level in a country and the extent of employment regulation, and basically those lines come out flat. You have some countries with very high employment and very high levels of regulation, and some countries with lower employment and high regulation”––[Official Report, Employment Rights Public Bill Committee, 28 November 2024; c. 116, Q119.]
So there is no clear relationship with the employment levels across countries. That is confirmed by the OECD, which has done lots of detailed work. That is what the Resolution Foundation said in its evidence to the Bill Committee last year.
Lincoln Jopp (Spelthorne) (Con)
Would the hon. Member like to put his money where his mouth is and tell us whether his faith in the Employment Rights Bill is such that he is prepared to make a commitment to his constituents in Ellesmere Port and Bromborough that if, having passed this Bill, unemployment goes up, he will resign his seat?
Justin Madders
I absolutely cannot believe that the Conservative party, which saw massive increases in unemployment in my constituency in the 1980s and 1990s when they were in power, have the cheek to start talking about the effects of unemployment on my constituents now.
The Resolution Foundation has said some things in recent weeks that I do not agree with, but it has said things in the past that are much more in line with what we believe the international evidence shows. So the kindest thing I can say about the Resolution Foundation is that I prefer its earlier work.
I turn to Government amendment (a) in lieu of Lords amendment 62, on repeal of the last remnants of the Trade Union Act 2016 and the removal of thresholds for industrial action ballots. I have always held the view that the introduction of e-balloting, if done properly, will lead to much greater participation in ballots and render arguments about turnout obsolete. The implementation timetable that the Government published indicates that e-balloting will begin next April. I hope that the Minister, when she responds, can provide some reassurance that that is still on track, and that we can therefore expect the end of thresholds to come at the same time, or very shortly thereafter. I would be disappointed if the amendment was an attempt to kick this issue into the long grass. I am not particularly keen on the conditionality in the amendment, which talks about whether to repeal the thresholds. There should be no question of “whether”; it should be about “when”. After all, that is what we promised to do in our manifesto. I urge the Minister to resist any temptation to introduce any conditionality and to deliver the Make Work Pay agenda in full, as we said we would.
I will conclude, because I am conscious that a number of Members wish to speak. I am proud that the Government are continuing to commit to implementing this Bill in full. The policies in the Bill are overwhelmingly popular with the public. They formed a key part of our manifesto and remain central to the Government’s plan for change. We on the Labour Benches proudly stand against those who seek to water down this Bill and hamper its implementation. We are proud to back workers and to deliver meaningful change in their working lives. We stand against maintaining the status quo of low pay, low security and little dignity at work, and we stand for job security and for delivering on our promises.
Antonia Bance
I wish to draw attention to my entry in the Register of Members’ Financial Interests, my proud 23 years in Unite, and the generous support from the millions of ordinary members of the GMB and ASLEF in paying into their political funds to put representatives of the working class here in Parliament.
I am here to deliver a simple but firm message: there will be no concessions on this Bill—not one. Opposition parties in the House of Lords are trying to water down the rights that working people voted for, but we will stand firm. The new deal for working people was a Labour manifesto commitment, and it will be delivered in full.
I want to talk about two sets of amendments, starting with Lords amendments 61 and 72, on political funds. The Lords want to keep the opt-in system, but it is abundantly clear that this is a deliberate attack on the political voice of working people. All this Bill does is restore the long-standing opt-out system that has lasted since 1946. Union members will still have robust rights, and they can opt out easily. Unions are tightly regulated—no other membership organisation has faced these rules. Unions’ political spending is transparent and accountable, with annual returns to the certification officer and the Electoral Commission regulating donations and campaigning. Of course, these political funds support wider campaigning, not just party donations, although I am proud to say that they support party donations too.
I also oppose Lords amendment 62, on keeping the unnecessary and unneeded ballot thresholds, which are designed to stop workers having a voice. The Tory and Lib Dem Lords want to reinstate the 50% turnout threshold that was introduced by the draconian Trade Union Act 2016. I remind Members from the Liberal Democrat party that they opposed that Act in 2016, including the ballot thresholds, and I wonder why they have now reversed their position. Ballot thresholds weaken unions and stall negotiations. Before 2016, ballots triggered talks and resolved disputes early. Now the thresholds delay dialogue and make resolution harder. No other organisations face turnout thresholds; this just singles out unions. Of course, anyone who is familiar with how the trade union movement works knows that no union would call members out on strike if they are not up for it.
With all due thanks and respect to the other place, we will still repeal the Trade Union Act 2016 in full, with no concessions. This Bill is the first step in delivering the new deal for working people—our promise to the working people of this country. This is the change that working people voted for. The Government will not give in to unelected Tory and Lib Dem Lords siding with bad bosses to weaken workers’ rights—not now, not today, not ever.
Anneliese Midgley
I thank my hon. Friend for his intervention and I absolutely agree with him about the work that my hon. Friend the Member for Middlesbrough and Thornaby East has done on this for over a decade.
This Bill brings changes that tip the scale in favour of working people and, taken together with the rest of the new deal for working people, it amounts to the greatest uplift in workers’ rights in our generation. That is down to the friends that I have just mentioned here today. It is their legacy and it is one that will change the lives of millions of working-class people for the better. I know that the Under-Secretary of State for Business and Trade, my hon. Friend the Member for Halifax (Kate Dearden), will do a great job of completing the process.
This is personal for me, because it was my dad’s secure, well-paid, unionised job on the production line in Ford’s Halewood plant that gave me a better life than my mum and dad had. It lifted us out of poverty and provided us with enough money and stability for a decent home, and enough to live a life of dignity on. Everyone should have that, and that is why I will fight for work where people can flourish and thrive and for jobs to take pride in that can provide a good life. No way would I be here in this place, representing the place where I was born and raised, if it was not for my dad’s job.
The Tories, backed by the Lib Dems in the other place, are trying to water down the Bill. They are aided and abetted by Reform, who are never in this place to debate this and have consistently voted against the Bill. Some of the Lords amendments would rip out the heart of the Bill. I am going to speak briefly to amendments 23 and 106 to 120, which would delay protections from unfair dismissal until a worker had been in their job for six months. This would mean that a worker could be dismissed at whim, for no reason. How is this okay? How is it defensible? A day one right not to be unfairly dismissed is good for workers and good for businesses.
My hon. Friend the Member for Blyth and Ashington (Ian Lavery) spoke about the research from the IPPR and the TUC, which found that 73% of employers supported giving employees protection from unfair dismissal from day one of employment. The shadow Minister, the hon. Member for Arundel and South Downs (Andrew Griffith), dismissed the TUC’s research from the Dispatch Box, but it represents 5 million workers and everyone else at work. Are they not stakeholders who should be listened to as well? We know that good employers up and down the country already live up to the standards that we are setting out in this Bill. Today, we need to stop these attempts to water down the Employment Rights Bill, deliver the protections from unfair dismissal that our constituents voted for and make sure we deliver the new deal for working people in full.
Kate Dearden
I thank all Members for their brilliant contributions today and for their engagement with the Bill throughout the many months we have been debating it. That is incredibly appreciated and valued.
I start by reiterating a quote from Professor Simon Deakin at the Cambridge University centre for business:
“strengthening employment laws in this country in the last 50 years has had pro-employment effects. The consensus on the economic impacts of labour laws is that, far from being harmful to growth, they contribute positively to productivity.”
I remind the shadow Minister, the hon. Member for Arundel and South Downs (Andrew Griffith), who made a number of contributions, of my opening remarks. UK employment laws are mostly a product of the 20th century. They have not kept pace with how businesses employ people or with how people experience their working lives today: when, how and where they work. The world of work has fundamentally changed in recent years. It is regrettable that the hon. Gentleman’s party spent 14 years impotently watching the rise of the gig economy and the many changes in our employment landscape but now pretends that the status quo still works for everyone. It simply does not. That is why the Bill is so important: it raises those standards and levels the playing field for businesses, so that they are not undercut by people who do not play by the rules, which negatively impacts their businesses and productivity. The Bill is important for working people so that they get that security and those rights at work, as well as for businesses, including those good businesses that already go above and beyond and do brilliant work supporting our workforce and different economies across the country.
The shadow Minister mentioned seasonal work. The initial reference period will be set out in regulations, as I have already spoken to. I reiterate that we believe that 12 weeks is the right length, balancing the need for qualifying workers to be offered those guaranteed hours reasonably soon after they start a role and the need for a reference period long enough to establish the hours that they regularly work.
I was surprised to hear the remarks from the shadow Minister on employment tribunals. On their watch, average wait times for an employment claimant increased by 60% between 2010 and 2022 due to funding cuts. The previous Government’s introduction of fees had a disproportionate impact on woman and the low-paid. Yet again, we are fixing messes that they left behind. The taskforce I mentioned in my introductory speech for how we can fix our employment tribunal system, and our work under the Fair Work Agency, which will be up and running next year, are incredibly important as part of that wider package.
Amanda Martin
It is good to hear about the taskforce. Could the Minister give us more information about what other things it will look at and investigate that will support employees?
Kate Dearden
The taskforce will bring together different stakeholders so that we can assess the problems within the system and work out the best way to fix them, because at the moment it is not working for employers or workers, who want access to justice and want it quickly.
Andy McDonald
Would the Minister agree that the introduction of these rights and protections is absolutely critical, but equally important is the ability to enforce those rights? The Fair Work Agency has the potential to bring that to fruition and ensure that when people are in those circumstances and are the beneficiaries of an award, they will ultimately receive it, because far too many people take on these cases and do not get any redress.
Kate Dearden
We met Matthew Taylor, the new chair of the Fair Work Agency, this week to discuss the agency’s progress to ensure that it is up and running at speed. As my hon. Friend rightly points out, enforcement is vital, and it is crucial that workers are aware of their rights. That is why the agency is so transformational in our approach and important for our wider agenda.
To respond to the Liberal Democrat spokesperson, the hon. Member for Richmond Park (Sarah Olney), I urge her to support the Government as we seek to update and upgrade our employment rights to be fit for the 21st century. She mentioned lots around detail. As I mentioned earlier, as is standard for lots of employment rights legislation, we want to consult extensively with businesses, unions and employers to ensure that we get this right, and I am sure that she agrees with that approach.
The hon. Member mentioned turnout thresholds. As I have mentioned, we want to create an industrial relations framework fit for a modern economy and workforce and that works for everybody. We have been clear that we intend to ensure that trade union legislation is proportionate and effective and does not create unnecessary bureaucratic hurdles. We remain committed to removing the 50% turnout threshold for industrial action ballots through the repeal of the Trade Union Act 2016. We support a strong mandate for strike action, but a threshold set in legislation is not the best way to achieve that.
My right hon. Friend the Member for Ashton-under-Lyne (Angela Rayner) talked about our proud Labour legacy of the courage and conviction to change lives, and she is a powerful and inspiring demonstration and testament to that. That is why this legislation is so important, reshaping the world of work and delivering security and dignity that people can feel, as she rightly mentioned. We cannot build a strong economy through employment insecurity. The legal loopholes that exist have contributed to the erosion of living standards and allowed a race to the bottom. I am always grateful for her support and thank her for her offer of support as we proceed to Royal Assent and the implementation stages to ensure that everybody across the country can benefit, workers and business alike, and that is why the Bill is pro-worker, pro-business and pro-growth.
My hon. Friend the Member for Ellesmere Port and Bromborough (Justin Madders) made a powerful speech and responded eloquently to lots of points raised by Opposition Members, and I thank him for that. I reassure him that we remain committed to the repeal of the 50% turnout threshold, and we have been clear that it is our intention to align the removal of thresholds with the establishment of e-balloting as an option for unions. The amendment does not change that commitment. We are working at pace to permit electronic balloting by April 2026. He will be pleased to know that we will shortly launch a consultation on an electronic and workplace balloting code of practice, and I encourage all stakeholders to respond to that consultation.
I thank my hon. Friend the Member for Tipton and Wednesbury (Antonia Bance) for her excellent points on the importance and use of political funds. I reiterate my remarks on the 50% threshold and hope that she is reassured by them. She will have heard the Government’s commitment to delivering the Bill in full from the Prime Minister and the Secretary of State at Labour conference. I hope to have reiterated that commitment at the Dispatch Box today.
I thank my hon. Friend the Member for Middlesbrough and Thornaby East (Andy McDonald) for all his work on this legislation. It has been a pleasure to work with him over a number of years. He mentioned fair pay agreements, which we are introducing for social care, as he rightly said. We will learn from that process before considering their introduction in other sectors, but I appreciate his passion for this area. I am sure that we will be in touch with him to speak about that progress.
Laurence Turner
May I invite the Minister to respond to two things? First, I was asked earlier how many times the word “maternity” appears in the Bill. The word “pregnancy” appears 16 times, “parental” 27 times, and “bereavement” 34 times, but we cannot restrict the debate to individual phrases. Secondly, this is not some abacus exercise; the real impact of the Bill is the change and improvement it will make for millions of working families thanks to day one rights.
Kate Dearden
I thank my hon. Friend for that excellent and well-made point. I am glad that he has managed to find the ctrl+F function with such speed. I always rely on him to provide such efficiency and clarity. The Bill will benefit more than 15 million workers. That is an incredibly powerful statistic to give at the Dispatch Box. More than 2 million people on zero-hours contracts could benefit, as well as the many workers he mentions who will benefit from further protections and rights at work.
Michael Wheeler
I thank my good and hon. Friend for giving way. Millions of workers, including those on zero-hours contracts, stand to benefit from the measures in the Bill. Does she agree that the amendments tabled by Liberal Democrat peers on the right to guaranteed hours are an unworkable bureaucratic mess that opens up scope for abusive practices in the workplace and removes the Bill’s meaningful protections from far too many workers?
Kate Dearden
I thank my good and hon. Friend for his important contribution. Like him, I meet many people in my constituency who do not know day to day whether they will have enough money for food and rent because they do not know how many hours they will work that week. That is why it is so important that we give people basic security by banning exploitative zero-hours contracts. We know that people value the flexibility that those contracts offer, which is why we are tackling the exploitative ones, as he rightly outlines. Those amendments might look for a different route to tackle exploitative zero-hours contracts, but we want to protect working people, because it is so important that they have certainty, week by week, on what they will be paid—that is what they deserve. I thank him for all his work in this area over a number of years. He brings a wealth of experience to this part of the Bill.
The Government are clear that we cannot build a strong economy while people are in insecure work. Employment law has not kept pace with modern working patterns, and that has allowed some employers to exploit gaps in the law, undercut responsible businesses and fuel a race to the bottom. Backed by our new industrial and trade strategies, the Bill will drive productivity, foster innovation and lay the foundations for long-term secure growth. It will level the playing field for good employers and put the UK economy in step with competitors in other advanced economies.
As we have heard today, I stand on the shoulders and build on the incredible hard work of many right hon. and hon. Friends. I pay tribute to them, and put on record my thanks and gratitude for all their work in getting us to where we are today. I hope that all hon. Members support the Government in our determination to get the Bill over the line and update our employment rights legislation in this country, for businesses and for employers, for the future and for growth. I thank hon. Members for their contributions.
Question put, That this House disagrees with Lords amendment 1B.