Employment Rights Bill Debate
Full Debate: Read Full DebateBaroness Jones of Whitchurch
Main Page: Baroness Jones of Whitchurch (Labour - Life peer)Department Debates - View all Baroness Jones of Whitchurch's debates with the Department for Business and Trade
(3 days ago)
Lords ChamberMy Lords, I thank the noble Lord, Lord Clement-Jones, for his Amendments 148, 149 and 150; the noble Lord, Lord Holmes of Richmond, for his Amendments 289, 290, 291, 292, 293, 294, 295, 296, 298, 315 and 316; and the noble Baroness, Lady Bennett, for her Amendment 323B. I thank them for generating an important debate on these issues. I thank my noble friend Lady O’Grady for her wise words on this issue.
I will take the amendments in turn. Amendments 148, 149 and 150 seek to introduce mandatory AI risk assessments in the workplace where there are significant impacts on workers, and would place a requirement on employers to consult employees and trade union representatives before implementing AI systems that might significantly impact employment rights and conditions. I thank the noble Lord, Lord Clement-Jones, for his Amendments 315 and 316, which would establish an independent commission on AI in the workplace and a project to investigate the potential challenges posed by the algorithmic allocation of work by employers. Amendment 323B, tabled by the noble Baroness, Lady Bennett, proposes a government review of the electronic monitoring of workers in the workplace. I agree with her that the cases that she cited were completely unacceptable.
As noble Lords will be aware, under data protection law employers are required to fulfil obligations as controllers if they collect and use their employees’ personal data. This includes the provision of meaningful information to the workers when collecting their personal data if any decisions about them having a legal or similarly significant effect will be based solely on automatic processing. Furthermore, as noble Lords know, the Data (Use and Access) Bill includes a range of safeguards relating to solely automated decision-making with legal and significant effects on individuals. I reassure noble Lords that the Government’s plan to make work pay makes it clear that workers’ interests will need to inform the digital transformation happening in the workplace. Our approach is to protect good jobs, ensure good future jobs, and ensure that rights and protections keep pace with technological change.
The Government are committed to working with trade unions, employers, workers and experts to examine what AI and new technologies mean for work, jobs and skills. We will promote best practice in safeguarding against the invasion of privacy through surveillance technology, spyware and discriminatory algorithmic decision-making. The plan’s proposals regarding the use of AI and monitoring technology in the workplace were not included in the Employment Rights Bill to allow time for the full suite of options to be considered with proper consultation, given the novel nature of AI-enabled technology. However, I assure the noble Lord, Lord Clement-Jones, that the Institute for the Future of Work will be welcome to make an input into that piece of work and the consultation that is going forward. I reassure the noble Baroness, Lady Bennett, and all noble Lords that this is an area that the Government are actively looking into, and we will consult on proposals in the make work play plan in due course.
I turn to the amendments in the name of the noble Lord, Lord Holmes of Richmond, beginning with Amendments 289 and 290. The Government agree with him that AI should be used ethically, with proper mechanisms for redress. That is why existing data protection legislation provides safeguards for solely automated decision-making with legal and significant effects on individuals and the use of AI where personal data is processed, including in workplaces.
I thank the noble Lord, Lord Holmes, for his Amendment 291, which would require workers and employers to maintain records of data and IP used in AI training and allow independent audits of AI processes. As he knows, this issue is under active consideration in the Data (Use and Access) Bill. A public consultation sponsored by DSIT, the IPO and DCMS on issues relating to copyright and AI, including questions on transparency, closed in February 2025. Transparency in the use of intellectual property material in AI training has been acknowledged in debates and government amendments as a critical issue. I committed only yesterday that the Government will publish a report on the subject within nine months of Royal Assent. I respectfully suggest that it is not helpful to have the same debate running across these two Bills at the same time.
In addressing Amendments 292 and 293 in the name of the noble Lord, Lord Holmes, I am happy to reassure him that the UK’s data protection framework already provides robust and effective protection for processing personal data, including for workers. Consent is a lawful ground for processing personal data, but it may not be freely given in employment contexts due to the power imbalance between the employer and the employee. That is why we would not deem it appropriate to restrict the lawful grounds on which data can be processed in this way. In addition, when processing personal data, organisations are required to notify data subjects, such as employees, of matters such as the purposes for data processing, any automated decision-making, any recipients of the data and the data subject’s rights. This includes the right to object to it being processed or to restrict what can be done with it.
Amendments 294, 295 and 296 in the name of the noble Lord, Lord Holmes, concern the use of automated decision-making. I reaffirm that, under data protection law, employers must fulfil their obligations as controllers if they collect and use employees’ personal data. They must provide meaningful information to workers when collecting their personal data if any decisions about them, having a legal or similarly significant effect, will be based solely on automated processing. This ensures that workers are informed about the logic involved in the automated processing, as well as the significance and envisaged consequences for them.
The reforms in the Data (Use and Access) Bill include a range of safeguards after a decision about an individual has been taken based solely on automated decision-making. I hope that noble Lords, including my noble friend Lady O’Grady, will be reassured that these safeguards include that the individuals receive information about significant decisions, as well as the opportunity to make representations and obtain human intervention.
Further, the Government agree that human intervention in automated decision-making should be carried out competently. The UK’s data protection regulator, the ICO, has existing guidance explaining how requests for human review should be managed. When it comes to high-risk automated decision-making, the Government do not feel it necessary to introduce an outright prohibition of processing of the nature described in Amendment 294. Specific requirements already apply for processing that could result in a high risk to the rights and freedoms of individuals. Organisations must carry out an impact assessment and consult the ICO where such an assessment indicates a high risk to individuals in the absence of effective measures.
I turn to Amendment 298, in the name of the noble Lord, Lord Holmes, on the creation of a new regulator for the use of AI in recruitment and employment. As the noble Lord may be aware, last year the previous Government published guidance on responsible AI in recruitment, which was developed with stakeholders and relevant regulators such as the Information Commissioner’s Office and the Equality and Human Rights Commission. The Government, via the AI Security Institute and the central AI risk function, are already progressing our understanding of AI risks, including AI and its impact on the labour market. This work is being carried out across government, with the involvement of each department where specific sector knowledge is valuable.
I remind the noble Lord that AI is not currently unregulated. Given the cross-cutting nature of AI, the Government believe that it is best regulated at the point of use by the UK’s existing sectoral regulators. As experts in their sectors, they are best placed to understand the uses and risks of AI in their relevant areas. That is why, in response to the AI action plan, the Government have committed to supporting regulators in evaluating their AI capabilities and understanding how they can be strengthened.
As set out in our manifesto, the Government are also developing legislative proposals that will allow us to safely realise the enormous benefits of the most powerful AI systems. These proposals will be highly targeted and designed to be future-proofed and effective against this fast-evolving technology. We look forward to engaging further with a wide range of stakeholders on our legislative proposals, including providing clarity on where responsibility for compliance with any new rules will lie.
Noble Lords have provided some interesting areas for consideration, but we are keen that these far-reaching amendments are properly assessed. I reassure noble Lords that this is an area that the Government are actively looking into. In this respect, I am pleased to note the active engagement between my officials and stakeholders, most recently with the IPPR, whose recent report on surveillance technologies makes a helpful contribution to the awareness and understanding of this context. As already mentioned, we intend to consult on these make work pay proposals in due course. Furthermore, I remind noble Lords that in response to the AI action plan the Government have committed to supporting regulators in evaluating their AI capabilities and understanding how they can be strengthened.
Finally, I thank noble Lords for their interest in how AI is being adopted in the workplace and the helpful way in which they have focused on these issues. I reassure my noble friend Lady O’Grady that we are working with the relevant stakeholders to build a strong evidence base to tackle the 21st-century challenges relating to these technologies. Our public consultation will be a crucial part of future-proofing the proposals. I assure noble Lords that the Government are committed to making sure that workers’ interests inform the digital transformation taking place in the workplace. I therefore ask the noble Lord, Lord Clement-Jones, to withdraw his Amendment 148.
My Lords, I thank all noble Lords for their contributions to this debate, which has been very interesting. The noble Lord, Lord Hendy, talked at some length about delivering a new deal for working people. He ranged fairly freely, so I might, too.
Did noble Lords opposite notice that a report published yesterday showed that there are now 150,000 fewer jobs since the Government took power? It is all very well delivering a new deal for working people, but there will be fewer of them, and this Bill will contribute to that. Noble Lords may not have seen it because it has only just come out, but a British Retail Consortium survey has just been published which shows—I am sure we will return to this theme next week—that half of retail directors now think they will reduce hiring, and 70% say the ERB will have a negative impact on their business.
Frankly, I am slightly staggered at the noble Lord’s Amendment 260, which seeks to return us to various EU standards, given that EU unemployment is, of course, generally significantly higher than it is in this country. Is that what the noble Lord aspires to? I am sure he does not, but that is how it looks.
The proposal to create statutory joint industrial councils raises significant concerns, not least the proliferation of new public bodies at a time when government and regulators are already stretched. Each of these councils would require administrative infrastructure, governance mechanisms, sector-specific expertise and ongoing support from both ACAS and the Secretary of State. This approach risks duplicating existing frameworks. We already have voluntary collective bargaining structures, recognised trade unions and sectoral engagement mechanisms in many industries. Superimposing a statutory model could complicate rather than enhance industrial relations, particularly in sectors where informal or local agreements are working effectively.
There is also the issue of flexibility. The statutory model risks creating rigid sectoral definitions that may not reflect the realities of modern hybrid or cross-sector employment. The labour market today does not always fit neatly into traditional categories, and it is unclear how the Secretary of State, even with ACAS guidance, would determine sectors without inadvertently excluding or misclassifying employers and workers. We must not overlook the potential for conflict or delay. Setting up these councils, negotiating procedures and achieving consensus across large and diverse sectors could slow down progress on pay and conditions, rather than speeding it up.
That is not an argument against collective bargaining. It is an argument for targeted, effective solutions that reflect the complexity of today’s economy, not a revival of structures drawn from legislation that is nearly half a century old. The world has changed. Where stronger bargaining is needed, let us work through existing mechanisms and invest in enforcement, rather than defaulting to the creation of statutory councils that may struggle to function as intended. I look forward to hearing from the Minister.
I thank my noble friends Lord Hendy and Lord Barber of Ainsdale for Amendments 203, 257, 260 and 322. I hope, despite my noble friend Lord Hendy’s concerns, that he recognises that this Bill is a major step forward in delivering a new deal for working people, exactly in the way our manifesto and the King’s Speech set out. I would also say that this is only the first step in our proposals, as we have made clear all along that the “make work pay” programme will, over time, roll out to a whole set of other issues we have flagged up as we have gone through this debate.
Turning to Amendment 203 in the name of my noble friend Lord Hendy, I am pleased to be having the debate on sectoral collective bargaining and to set out the Government’s commitment to supporting it through the introduction of fair pay agreements in social care and the school support staff negotiating body, which we have just debated in detail. We want to ensure that the labour market works for everyone. A key aspect of this is allowing workers to participate in collective bargaining to improve pay and conditions. However, where labour markets are operating effectively or where existing collective agreements are working well, the Government recognise that sectoral collective bargaining may not be the best solution—I think this was the point the noble Lord, Lord Sharpe, was making.
The amendment would enable the Secretary of State to establish statutory joint industrial councils in unspecified areas without parliamentary scrutiny or appropriate safeguards. We are committed to starting with fair pay agreements in the social care sector to address the stark and specific issues in the vital sector, which we have already debated. As part of our ongoing policy work, we are exploring how future sectors could benefit from sectoral collective bargaining. However, we first want to learn from this process to improve our policy approach and ensure that future sectoral collective bargaining arrangements most effectively respond to the complexities of the modern workforce. In the meantime, I assure my noble friend that we are committed to supporting sectoral collective bargaining and recognise the positive contribution it can make to the British economy.
Amendment 257 in the name of my noble friend Lord Hendy would add duties of promoting collective bargaining to ACAS’s remit. An existing ACAS code of practice provides guidance on the disclosure of information to trade unions for collective bargaining purposes. I have listened carefully to what my noble friend said, and I am afraid we will have to disagree on this. We do not support the amendment; we think it is important that ACAS maintains its independence and impartiality between employers and unions. We are concerned that the current status could be compromised by this amendment.
On Amendment 260 in the name of my noble friend Lord Hendy, we have debated the school support staff negotiating body and the social care negotiating bodies. A benefit of these sectoral bodies will be broad sectoral agreements. We expect that many workers in these sectors will be able to benefit from collective agreements for the first time. We intend to learn from the first fair pay agreement process in social care and the SSSNB, before considering rolling out agreements in other areas, as I have said.
Additionally, this amendment requires the Secretary of State to consult on and bring forward this action plan within six months. It is important that such policy matters have enough time for consideration, and we are keen that employer organisations and trade unions prioritise the consultations committed to in Make Work Pay, which will follow Royal Assent to the Bill.
My Lords, I thank the noble Baroness, Lady Noakes, and the noble Lord, Lord Jackson, for tabling Amendments 205, 206, 207 and 208. I acknowledge that the noble Lord introduced the amendments on behalf of the noble Baroness. I will also address the noble Lords, Lord Sharpe of Epsom and Lord Hunt of Wirral, on their opposition to Clause 55 standing part of the Bill.
I am sorry that the tone of the debate has somewhat deteriorated this afternoon. I thought that we were having a reasonable, grown-up conversation until now. I am grateful to the noble Lord, Lord Jackson, because he admitted that what he was saying were his prejudices—and that is certainly what it sounded like. He was talking about a period 50 years ago, and, as the noble Lord, Lord Goddard, said, the world of work has changed significantly since then. As we absolutely acknowledge, we now have outdated employment processes and huge levels of exploitation, including a climate where it is not easy or encouraged to be a member of a union. That is one of the issues that we are seeking to address here.
I have to say to the noble Baroness, Lady Lawlor, who tried to give us a talk about democracy, that this Government were elected with a huge win on a manifesto to introduce the legislation that we have before us today.
I thank the Minister for giving way, but I do not know that a mandate of 33% of the electorate is indeed a very strong mandate for overturning the reforms that have brought stability to the workplace.
We can have a long discussion about that, but if we are talking about mandates, it may well be argued that probably Baroness Thatcher did not have that kind of mandate either. The fact is that we won that election with a huge majority, and I am very sorry that the party opposite lost so badly. They might want to reflect a little bit more on why that was, because some of the issues that noble Lords have been talking about in relation to the state of our economy are exactly what we inherited from the previous Government. Those issues are absolutely the result of that Government’s economic policies and not ours. We have been taking great steps to improve the situation. While I am on that issue, I should say that, as a result of this Government’s actions, we had the fastest-growing economy in the G7 at the start of this year; we have done three trade deals in three weeks, with India, the US and the EU; interest rates have been cut four times—
The Minister is aware, of course, that interest rates are independently managed by the Bank of England.
I make my case. The only reason those interest rates were cut was that our economy has been improving. Some £63 billion of private investment was announced at the investment summit last year. Introducing this Bill within 100 days will boost protections and quality of work for the lowest-paid, raising living standards across the country and creating opportunities for all.
I turn to the actual amendments. Amendments 205 and 207, in the name of the noble Baroness, Lady Noakes, would introduce exemptions to this measure based on the size of the business. The new duty on employers to inform all employees of the right to join a union is a key part of the Government’s wider commitment to strengthen workers’ voices in the workplace, enhancing their representation and ultimately improving working conditions through increased trade union membership and participation. Making exemptions of this kind risks creating a two-tier system in which some workers benefit from this important information while others do not, based purely on the size of their employer. We are committed to striking a fair and proportionate balance, ensuring that workers are aware of their rights without placing undue burdens on employers.
The statement will be provided at the start of employment, alongside the written statement of particulars, which employers are already required to give under Section 1 of the Employment Rights Act 1996 and on a prescribed basis. Therefore, I say to the noble Lord, Lord Jackson, that we do not believe that this is a particularly significant extra burden to justify exempting certain employers because of their size, because they already have to give that information anyway.
The noble Baroness, Lady Coffey, and others asked about the frequency. We will consult on the specific details, such as the frequency, manner, form and content of the statement before it is outlined in secondary legislation, and I can let noble Lords know that that will be via the negative procedure. We will particularly encourage input from both businesses and unions of all sizes to share their views.
The Minister just referred to the negative procedure. Is that a final decision? Given that the Bill takes so much power to make a series of important decisions by statutory instrument, I think the general expectation would be that such an important decision would be made by affirmative resolution. Would she perhaps contemplate whether that might be the better solution?
I thank the noble Lord for that introduction, because I was going to go on to say that the Government think that the powers taken in Clause 55 are necessary and proportionate. Indeed, the Delegated Powers Committee said that
“it is heartening that in a Bill with so many delegated powers”
it had
“only found four on which to raise concerns”.
Clause 55 was not one of those four, and we will of course respond to the committee’s recommendations in due course.
While we are considering what the Delegated Powers and Regulatory Reform Committee concluded, I recall that the last time I raised the use of the Henry VIII powers, the Minister said that this Committee would see her draft implementation plan, to which my noble friend referred just a short time ago. We have not yet seen that plan, and a lot of businesses are very concerned about the uncertainty that is being created by not knowing, certainly by now, when these various powers are going to be brought into effect. Will she give some timescale by which we will see the implementation plan, if only in draft?
I know we have discussed the implementation plan several times now, and I can assure noble Lords that we are working at pace to finalise that. I do not think it would be helpful to see it in draft or imperfect form. We want people to have a categorical road map which shows the way forward. We absolutely understand that businesses need to see that; we are working on it. I am very confident that when businesses see it, they will be reassured that none of the things that we are proposing in this legislation will be rushed through. They will have time to prepare for it—I think we had a debate about this earlier. We know that businesses need time to prepare, we are absolutely aware of that, and we are going to make sure that they have it.
I just wanted to clarify something the Minister said. I think I heard her say that it would be done by negative resolution. Does that apply to all of Part 4 or specifically for every element of Clause 55?
My answer was specifically about Clause 55.
Amendment 206, in the name of the noble Lord, Lord Jackson, would remove the compulsory element of the proposals, making it optional for employers to inform workers of their rights to join a union. To be clear, this is not about necessitating union membership but about ensuring that workers are aware of their rights and can make an informed decision about whether to engage. We want to empower workers to take a more active role in protecting their rights, and, where they choose, to participate in collective bargaining to improve their working conditions. Access to clear and accurate information is fundamental to that. This amendment would seriously weaken this measure by allowing employers to simply ignore the duty, defeating its policy intent entirely. It is vital that the right to union membership is made accessible to all workers as intended, that it is communicated regularly, and that employers are under a firm obligation to do so.
Amendment 208, in the name of the noble Baroness, Lady Noakes, would remove the requirement for employers to issue a statement of trade union rights on a prescribed basis. We are legislating for ongoing reminders of the right to join a trade union to reflect the reality of the workplace. New employers may miss information at the start of employment or change roles over time within the same organisation. Limiting the duty to the start of employment would also exclude existing staff, who equally deserve access to that information.
This statement of the right to trade union membership is important in fostering worker engagement and meaningful dialogue between unions and employers. Ongoing reminders are a key part of this measure. The Secretary of State will be able to set the frequency of this notification. This will be, as I have said, outlined in secondary legislation, subject to public consultation, and we invite interested parties to provide us with their views on this matter when we launch the consultation.
On the wider issue, the noble Lord, Lord Jackson, urged us to consult more. I can assure him that these proposals have been subject to extensive consultation, and we are continuing to consult on them. I can also tell the noble Lord that we had a very constructive meeting with the Federation of Small Businesses.
Finally, I turn to the clause itself. Clause 55 introduces a new legal duty on employers to inform workers of their right to join a union. Employers will be required to issue this statement at the start of employment, alongside the written statement of particulars, which I commented on earlier. There is currently no requirement in law for employers to notify their workers of the right to trade union membership. This lack of awareness may be contributing to the falling union membership and reduced worker participation in collective bargaining that we have been discussing. This duty intends to address this gap, ensuring that workers are better informed of this right and helping to strengthen the collective voice in the workplace and enhance their representation. This delivers on the Government’s commitment to improve working conditions through increased trade union membership and participation. Specific details of this measure, including the frequency, form, content and manner of the notification, will be set out in secondary legislation, as I have said. Therefore, I ask the noble Lord to withdraw his amendment and I urge that Clause 55 stand part of the Bill.
Just to press the point on the implementation plan, I am sure the Minister saw yesterday that the OECD downgraded growth forecasts for this country. Obviously, it blamed the global trade picture for a lot of that downgrade, but it also talked about business certainty in this country—or the lack of it. She herself has just acknowledged that businesses need certainty. The OECD is saying this, this is not just us alleging it. Will she please commit to picking up the pace when it comes to delivering this implementation plan and delivering it as soon as possible?
My Lords, I am fully aware that it would help to see the implementation plan and, as I said, we are working at pace to get it to your Lordships as soon as we can.
My Lords, I thank all noble Lords who participated in this very interesting debate. I think you always know when your arguments are hitting home when you are admonished by the Front Bench about tone. It usually means that you are hitting the target. I particularly thank my noble friends for the typically erudite and forensic analysis of Clause 55 by my noble friend Lady Coffey, the excellent real-world experience articulated by my noble friends Lord Ashcombe and Lord Leigh, and, of course the passion, from real-world experience, of my noble friends Lady Lawlor and Lord Moynihan of Chelsea.
I do not want to get into a historical discussion, because the hour is late, but Margaret Thatcher was mentioned. Margaret Thatcher never won an election with the puny mandate that this Government had, because what we are seeing is a counterrevolution in favour of the trade unions based on 20% of the electorate, a turnout of 66% and a 34% poll. That is no kind of mandate. In fact, it is a post-dated cheque to the trade unions paid for by the British taxpayer and working people of this country.
There is news from Birmingham, incidentally, as Birmingham was mentioned earlier. Four hundred Unite members have just voted today to carry on striking all the way to Christmas. This is an interesting quote from Sharon Graham, the Unite general secretary, known to our collective trade union alumni. I do not know what the collective term is: union barons, perhaps. She said:
“It beggars belief that a Labour government and Labour council is treating these workers so disgracefully … Unite calls on the decision makers to let common sense prevail in upcoming negotiations”.
The reason I quote that is that I have to say very gently to the Government Benches: be careful what you wish for. The 1974 Labour Government was destroyed by the trade unions’ actions in the winter of discontent of 1978-79. If the Government proceed with this Bill unamended, they run the risk that that unintended consequence might also be the end of their Government. I would not wish that to be the case, of course, because I think that they sincerely believe they are doing the right thing. Nevertheless, it is a risk.
Let us step back from the historical discussions that we have had in what has been an interesting debate. We are being asked to vote for a clause in primary legislation with huge delegated powers in the hands of Ministers. That brings me to a very interesting quote, that
“excessive reliance on delegated powers, Henry VIII clauses, or skeleton legislation, upsets the proper balance between Parliament and the Executive. This not only strikes at the rule of law values I have already outlined but also at the cardinal principles of accessibility and legal certainty”.
That was beautifully put, by the noble and learned Lord the Attorney-General in his Bingham lecture, proving that he is not always wrong about everything.
We have tabled these amendments because this clause does not give us the detail, it will have unintended consequences, and it will have a real-world impact on small businesses in particular. It is not about bashing the trade unions. I would concede, as someone who was a trade union member, that the trade unions have done a brilliant job in terms of member welfare, insurance schemes, et cetera, over the years. They are a force for good generally, but the measures in the Bill far too easily tip the balance against businesses trying to earn a living, in favour of unions, by repealing all the legislation from 1979 and 1992.
The Minister and the noble Lord, Lord Leong, are doing a difficult job and defending a sticky wicket, but I do not think that the Minister really engaged with the arguments. I hope that on Report there is an opportunity to alter this clause, to make it a little less onerous and burdensome to businesses while keeping the spirit of the legislation for workers. On that basis, I am happy to withdraw my amendment.