Employment Rights Bill

Lord Ashcombe Excerpts

Committee stage
Thursday 8th May 2025 Lords Chamber

[Baroness O'Grady of Upper Holloway (Lab)]

My Lords, it is a pleasure to follow the noble Baroness, Lady Penn. I shall speak to Amendment 66 in the name of my noble friend Lord Watson, who is unable to be in his place today due to a long-standing family commitment.

Clause 9, on flexible working, will make a huge difference to working people, including those with caring responsibilities. Many of us know all too well and very personally the daily juggling-act miracle that working mums especially are expected to perform. Anything that makes their lives easier has to be welcome. Flexible working has the added benefit to business and for the wider economy of making it easier for carers to both enter the workforce and stay there. This will help close the gender pay gap, reduce child poverty and help keep mothers and babies healthier.

Amendment 66 seeks to address the concern that, to be effective, those new rights must have teeth. I know that my noble friend Lord Watson would want to acknowledge the support of Maternity Action and the National Education Union in preparing this amendment. Amendment 66 would require the Business and Trade Secretary to review and publish a statement on the adequacy of the maximum compensation which an employment tribunal can award where an employer has not followed its obligations in dealing with an employee’s flexible-working request.

Currently, employees have the right to request flexible working, but employers can refuse on a wide range of listed grounds. Clause 9 boosts employees’ rights by introducing a reasonableness requirement, meaning that employers will be permitted to refuse a statutory flexible-working request only if it is reasonable to do so on one or more of the listed grounds. This new requirement is a positive step towards making flexible working the default. The problem is about the maximum compensation which an employment tribunal can award when it upholds an employee’s complaint about how an employer has treated their flexible-working application.

Currently, the maximum compensation that an employment tribunal can award is eight weeks’ pay, capped at £719 per week, which is a total of £5,752. This low compensation cap does not reflect the devastating cost to a worker where that flexible working has been unreasonably refused. Maternity Action and trade unions have documented how unreasonable refusals effectively force employees—particularly many new mothers and other carers—out of their job, often into lower-paid and less secure work or out of work altogether.

Flexibility should be a two-way street for the employer and worker, but in the real world too often it is mothers who are paying a high price. Set against the expense of legal representation, the low level of compensation available deters mothers from pursuing a flexible-working complaint through an employment tribunal. Their only meaningful recourse may be an indirect sex-discrimination claim against their former employer for which compensation is not capped. However, such claims are often long, complicated and extremely stressful. It is much better to send a signal that the Government are serious about enforcing flexible working rights so that employers are encouraged to do the right thing in the first place.

In the Bill’s impact assessment, it is stated that an aim of the changes in Clause 9 is to allow an employment tribunal to scrutinise whether the decision to reject a flexible working request was reasonable. For that to be effective, penalties should be introduced that reflect a substantive failure to act in accordance with a new reasonableness requirement. The Government’s aim of making flexible working the default is very welcome, but I hope my noble friend the Minister will consider bringing forward an amendment on Report or provide reassurance that other routes will be taken to ensure that the new right to flexible working is one that will be enforced in practice and that workers who are unreasonably refused such arrangements get adequate compensation.

[Lord Ashcombe (Con)]

My Lords, I support my noble friend Lady Penn. I declare an interest that I work for Marsh, a very large insurance broker in this country and around the world. I run a team of between 30 and 40 people. Within that team, I have all sorts, sizes and cultures—you name it. Of that team, all the married women—I should say, the women with children—have some sort of flexible way that they work with us. I can tell noble Lords from my own experience that unhappy staff do not do good work; it is 101. Happy staff are very likely to do very good work. One of my main jobs is to keep my team happy, and I am given immense flexibility to do it. Without this amendment, it is less easy. I rest my case.

[Lord Jackson of Peterborough (Con)]

My Lords, I rise to oppose the amendment in the name of the noble Lord, Lord Watson of Invergowrie, which was so ably enunciated by the noble Baroness, Lady O’Grady. I think that the amendment is neither fish nor fowl really. It is perfectly possible, as I understand it, for the Government to have already addressed this issue and, by statutory instrument, to set differential rates for compensation at employment tribunal. It seems rather a waste of time, and not necessarily a good use of ministerial time, to put in primary legislation another review.

My substantial issue is also that this, again, tips the balance are much more towards the worker, unreasonably, and away from the employer. I think that is to be deprecated, because that is what we have seen in so many aspects of this Bill. This leads me to conclude something else as well. On a risk-based assessment of whether you would wish to employ a person, an employer may very well conclude—it may, unfortunately, be an encumbrance of being a female employee or potential employee—that “We do not wish to employ that person because she may apply for flexible working, and it is better to employ someone else”. This is particularly because of the risk that, in going to an employment tribunal, after already having believed they had behaved in a reasonable way, they would be subject to a potential substantial monetary fine, which will impact on their bottom line. That is not good for those workers. It is not for the women who wish to work and have flexibility.

I broadly agree with the idea of reasonableness in applying for flexible working. That is how our jobs market and employment regime works now. Many women do want flexible working, and it is absolutely right that employers reasonably consider that. But I think this amendment is a step too far, because it will have the unintended consequence of making it more likely that women will not be employed because they may ask for flexible working. I think it is otiose: it is unnecessary, and it will not add to the efficacy of the Bill.