Employment Rights Bill

Lord Katz Excerpts

Committee stage
Wednesday 18th June 2025 Lords Chamber

I would be grateful if the Minister would clarify the following points. Do the Government intend to publish a detailed implementation plan and, if so, when? Will there be an opportunity for Parliament to formally scrutinise that plan before the agency becomes operational? Do the Government anticipate a separate consultation on how the new powers will be exercised in practice? These are important questions not just for Parliament but for businesses, workers and enforcement bodies that will need to work with that agency and develop a strategy in a live environment. A stronger enforcement body is undoubtedly needed, but it needs to be under- pinned by clarity, accountability and proper scrutiny. My noble friend Lord Fox’s amendments offer a thoughtful and proportional framework to achieve that, and I commend them to the Committee.

[Lord in Waiting/Government Whip (Lord Katz) (Lab)]

My Lords, I thank the noble Lords, Lord Sharpe of Epsom and—in absentia—Lord Fox, for tabling Amendments 271ZZA, 274, 277, 278 and 328. Before I go any further, I think we all join the noble Lord, Lord Goddard, certainly from our Benches, in wishing the noble Lord, Lord Fox, the very best and speediest of recoveries. We hope to see him back in his place at the earliest opportunity.

I will speak first to Amendment 271ZZA moved by the noble Lord, Lord Sharpe of Epsom. This amendment is unnecessary, as Clause 91(3) provides full discretion for the Secretary of State to revise the labour market enforcement strategy at any time, including following a general election. That means that a new Government are not locked in. They can act swiftly, decisively and in line with their mandate. Were the party opposite to win power again sometime in the distant future, however difficult that is to imagine, its hands would not be tied by these proposals.

Of course, businesses, workers and enforcement bodies all benefit from clarity, consistency and strategic continuity. Automatically scrapping an enforcement strategy, just as the Government are finding their feet, risks creating exactly the kind of disruption we should be avoiding. To reassure the noble Lord, Lord Hunt of Wirral, the Bill is about strengthening our ability to tackle non-compliance and exploitation in the labour market, including, in the very worst cases, the scourge of modern slavery. The intention and mandate of the fair work agency are to catch the bad actors, not to trip up the good guys. This amendment risks instability rather than accountability.

Turning to Amendments 274, 277, 278 and 328 tabled by the noble Lords, Lord Sharpe of Epsom and Lord Fox, I want to be absolutely clear that the Government are committed to effective, transparent enforcement of workers’ rights. The creation of the fair work agency is a major step forward and we want to get it right, but these amendments are wholly unnecessary, duplicating myriad reports and recommendations over several years. By our count, there have been 33 government reports and strategies about the effectiveness of labour market enforcement over the past nine years. One could argue that this subject has been reported and scrutinised to death. The Director of Labour Market Enforcement produces an annual report and strategy that reviews the effectiveness of the labour market enforcement system. These documents are available in the Library of the House.

Additionally, our impact assessment for establishing the fair work agency sets out the current running costs of the enforcement bodies and initial estimates of set-up costs for the agency. I also refer noble Lords to reviews published by previous Administrations, including the Taylor review, which assessed the labour market enforcement system and found it wanting.

Ongoing oversight of employment rights enforcement is provided for in Clauses 91 and 92. They require the Secretary of State to publish a three-year labour market enforcement strategy and annual reports, which must be laid before Parliament and the Northern Ireland Assembly. To address the question of the noble Lord, Lord Jackson of Peterborough, they will be subject to parliamentary scrutiny in the usual way, which could well involve scrutiny by a Select Committee in the other place.

While the Bill does not explicitly require that the enforcement strategy and annual report address the agency’s funding, I can confirm to the Committee—and to the noble Lord, Lord Jackson, in particular—that the annual report will indeed include an assessment of the fair work agency’s budget and how this has been spent.

Turning to Amendment 328, establishing the fair work agency is not and should not be contingent on its reporting. I remind all noble Lords, particularly the noble Baroness, Lady Lawlor, that this was not only a Labour Party manifesto commitment; it was the policy of all the major parties at the general election to introduce a single enforcement body in some shape or form.

[Baroness Lawlor (Con)]

Just because one side of the House or the other—or, indeed, both—brought it in does not necessarily mean it is the right policy. Does the Minister not agree that, if we have a chance to review some of the weaknesses in inherited policy, it is a very good time to do it? The 2017 Taylor review, on which some of the then Government’s policy was based, focused particularly on the most vulnerable workers and certain categories. It was not a very wide focus.

[Lord Katz (Lab)]

We have had a fair amount of scrutiny of the wider proposal, rather than the Bill’s specific fair work agency proposals. As I said, over the past nine years since 2016, there have been 33 different strategies and reports, including—but certainly not limited to—the Taylor report. This is not an area that has not been considered and scrutinised to some degree. I also say to the noble Baroness that the Single Enforcement Body—as it was called by the previous Administration—was the policy of successive Conservative- led and Conservative Administrations. I am not going to intrude on the great policy disagreements on that side of the House. We feel it important to establish the fair work agency and to ensure that we have strong enforcement of labour market regulations. I therefore ask the noble Lord to withdraw Amendment 271ZZA.

[Lord Hunt of Wirral (Con)]

My Lords, this has been a very significant debate, because I believe it is the first time I have heard from the Government Front Bench an acceptance that the Opposition will eventually take over government again. He and I may disagree on when this will happen—of course we disagree: I just happen to believe that it is going to happen at the next general election. That is why these amendments are so important.

I also want to say how much we miss the noble Lord, Lord Fox. I was very disturbed indeed to hear about his unfortunate accident, but I am very pleased to hear that he may shortly be with us. I hope that, by speeding up the process to Report in July, he will still be able to be with us, because he has always brought a note of common sense—despite coming from the Liberal Democrat Benches. Now I am upsetting everyone. All I want to say to the noble Lord, Lord Goddard of Stockport, is that he has been a marvellous substitute, if one can say that. His pragmatic approach to the Bill has been enormously valuable, but we do miss the noble Lord, Lord Fox.

I thank my noble friend Lady Lawlor, who is quite right: we are moving into unknown territory. Although the Minister might remind us that the Conservative Government were committed to looking at stepping in this direction, we are still moving into unknown territory and, as my noble friend Lord Jackson of Peterborough pointed out, the CIPD cost estimates are really worrying. I do not think the Minister properly addressed his key question on the whole issue of accountability.

However, here we are. I am surprised that the Government have rejected Amendment 271ZZA. It is a reasonable and pragmatic amendment that simply recognises the basic democratic principle that a new Administration should have the ability to review and, if necessary, revise a labour market enforcement strategy to reflect new economic realities and public priorities. Despite the amendment to which he referred—which is at the margin—the Government have always insisted that a labour market enforcement strategy must run its full term without reset, regardless of elections or changes in government. But why should a new Government be bound by a strategic direction set by their predecessor? That is not consistent with the democratic mandate bestowed on any incoming Government. Surely it is neither logical nor democratic to compel a newly elected Government to implement a strategy they did not design, especially in a labour market that is dynamic and constantly evolving.

Economic landscapes can shift dramatically within short periods, whether due to international events, technological change or domestic challenges. Flexibility to adjust enforcement priorities accordingly is essential. It is not only a question of governance, but of ensuring that enforcement remains effective and responsive to current labour market conditions. The Government have already recognised the importance of periodic review and the resetting of the labour market enforcement strategy every three years, as set out in Clause 91. If I am not mistaken, that periodicity is built into the framework precisely to ensure that the strategy remains relevant and responsive.

The main feature of this debate has been the cogent arguments put forward by the noble Lord, Lord Goddard of Stockport. His insights, and those of my noble friend Lady Coffey, highlight the pressing need for a substantive independent review of the proposed fair work agency. While the promise of increased efficiency in enforcement is welcome, we must remember that there are intentions and then there are results. We must understand how such efficiency will be achieved and at what cost, what other alternatives were considered, and why they were rejected.

To date, the Government have not committed to publishing any specific details about the establishment of the fair work agency—details that are crucial for proper scrutiny. We lack clarity on the expected costs of this new body, the standards by which compliance will be measured and the criteria that will guide enforcement decisions. Without that transparency, it is difficult to assess whether the creation of this body will represent genuine progress or simply add another layer of bureaucracy, which, as the noble Lord, Lord Goddard of Stockport, stressed, will impinge on smaller businesses in particular.

There remains much to discuss and questions to be answered about the fair work agency. Unfortunately, I find myself unconvinced by the Government’s arguments against the amendments proposed by myself and the noble Lord, Lord Goddard of Stockport. Our proposals are not about obstruction but about ensuring proper oversight, accountability and flexibility in this important area of labour market governance. I am sure that we, and the Liberal Democrats, will return to these issues on Report, but for now, I beg leave to withdraw the amendment.

--- Later in debate ---

[Baroness Lawlor (Con)]

My Lords, I support the amendments in the name of my noble friend Lord Sharpe. I declare an interest as a director of a very small business—a think tank.

As an employer, the idea that we have no warrant or judicial oversight of an enforcement officer’s intrusive visit to a business to seize or take copies of documents and to check up is intrusive on the time and output of the business. It is also an infringement of a business freedom to conduct the business to the best ability of those in the office or the business.

Both clauses in fact contain very intrusive proposals. As my noble friend pointed out, one of the things that is deeply worrying about them is we do not know who the enforcement officers will be or exactly what their powers will be. We have seen, even with the best trained police force in the world, the Metropolitan Police and local police forces, a certain amount of over-zealousness in pursuing certain types of crime. Therefore, with an untrained and unknown quantity and with such powers, we need very clear limitations, and we need to focus on the most serious crimes and those outlined in these amendments. For those reasons, I support both the amendments in the name of my noble friend.

[Lord Katz (Lab)]

My Lords, I thank the noble Lord, Lord Sharpe of Epsom, for tabling amendments relating to the fair work agency’s powers. Clause 94 introduces a single power to enter business premises and inspect workplaces. The noble Lord’s Amendment 271ZB would limit this power to such an extent that effective enforcement of the legislation, including the national minimum wage, would be extremely difficult. We are not amalgamating labour market enforcement into one single agency to diminish its effectiveness. This amendment would, in effect, prohibit the site visits that most minimum wage investigations rely on and bring an end to a system of state enforcement that has worked well for 25 years. The result would likely be an increase in claims to the employment tribunal. Given the noble Lord’s concern about employment tribunal capacity, I urge him to withdraw his amendment.

I turn to Amendment 271ZBA. While powers of entry are generally exercised on a consensual basis, in some situations it is critical that officers are able to carry out their duties quickly, particularly if they suspect that giving advance notice could give rogue employers time to destroy or tamper with evidence. None the less, in response to the concerns raised by both the noble Lord, Lord Sharpe, and the noble Baroness, Lady Lawlor, an officer will not enter a premises if a person is not present but will instead notify the person to rearrange a time to enter the premises. As the noble Lord, Lord Sharpe, mentioned, a warrant could be issued by a justice only if they are satisfied that there are reasonable grounds for entry, and judicial oversight ensures that warrants are granted only when appropriate, protecting businesses from unwarranted inspections while enabling legitimate investigations.

Clause 128 and Schedule 8 were added to the Bill to put in place appropriate safeguards relating to the execution of warrants. As I said, this approach will continue under Part 5 of the Bill, but with additional safeguards, such as needing a warrant before exercising powers to enter a dwelling. Extending this warrant requirement further to include all business premises would be a disproportionate and retrograde step in enforcement terms. It would introduce additional powers and bureaucracy, and create an unnecessary burden on the warrant system.

Amendment 271ZD is unnecessary. There are already extensive safeguards in the Bill around the use of investigatory and enforcement powers. These safeguards are designed to ensure that the use of enforcement powers is lawful and proportionate. In addition, enforcement officers are highly trained and carry out investigations under a strict code of conduct.

Clause 107 largely carries over the existing appeal grounds from the notice of underpayment regime contained in the National Minimum Wage Act 1998, which, as I said, has been functioning successfully for over 25 years. In fact, I recall debates in previous days of Committee around the effectiveness of minimum wage enforcement and the fact that not enough rogue employers have been named and shamed. The process as it stands is well known and understood by businesses and individuals. Changes risk adding confusion and uncertainty, leading to additional complexity and litigation.

Amendment 273LA would constitute a drastic downgrade in labour exploitation enforcement. The Gangmasters and Labour Abuse Authority can and must occasionally use force under PACE powers to rescue victims of modern slavery and tackle serious labour exploitation. Indeed, it is through the use of those powers that we saw two modern slavery convictions and 13 slavery and trafficking risk and prevention orders in the last reporting year of 2023-24. To reassure the noble Lord, Lord Sharpe, as is currently the case, the use of PACE powers will be strictly limited to a small number of officers, as set out in their letters of appointment, and subject to stringent IOPC oversight functions and complaints and misconduct procedures.

I am sure the whole Committee will agree that we must tackle the scourge of modern slavery. The Bill is designed to strengthen employment rights in a clear, coherent and enforceable way. Unnecessary additions or alterations, however well-meaning, could compromise that aim. On that basis, I ask the noble Lord, Lord Sharpe of Epsom, to withdraw his amendment.

[Lord Carter of Haslemere (CB)]

My Lords, I think the Minister explained that the reasons against requiring a warrant to be issued by a magistrate included the fact that an employer might destroy documents that were the purpose of the need to enter the premises. In those circumstances, why could the clause not say that, if the enforcement officer can show the magistrate reasonable cause to have concerns about the destruction of a document, they could apply on an ex parte basis for the search warrant? That would mean there would not be that risk of the destruction of documents in advance.

[Lord Katz (Lab)]

The noble Lord raises an interesting point, though I fear straying into legal territory, which I am not adequately briefed to comment on. I will write to him with further detail on the specific example he set out.

--- Later in debate ---

I hope the Minister will recognise the strength of the points made by my noble friends. There is always a case for helping people who are in difficult positions, but we need to make sure that any assistance is fairer, clearer and precisely targeted. We now await with great interest the noble Baroness’s response.

[Lord Katz (Lab)]

I do not want to disappoint the noble Lord, but I am afraid he is stuck with me again. I thank the noble Baroness, Lady Coffey, for tabling amendments on legal assistance and the noble Baroness, Lady Noakes, for notifying us of her opposition to Clause 114 standing part of the Bill.

I will start with Amendment 272BA. To be fair, the noble Baroness, Lady Coffey, and others indicated that this has overlapped with not only previous discussions today but discussions of groups on previous days in Committee. As my noble friend Lady Jones said on Monday, the drafting of Clause 114

“was carefully thought through and is deliberately broad and inclusive”.—[Official Report, 16/6/25; col. 1883.]

It is only fair that it covers not just employees but employers and trade unions. To answer a specific question from the noble Baroness, Lady Coffey, about what other assistance could be provided, this could include help in understanding procedural requirements, preparing documents or accessing expert input. It is designed to be flexible and responsive to individual needs. Given this, we cannot support Amendment 272BA.

Amendment 272D would restrict the amount of support that could be offered to any individual through this power. It is not a reasonable measure. I understand that it is a probing amendment, as the noble Baroness, Lady Coffey, said, but the small amount proposed in the amendment would leave the power meaningless. As we have discussed, this would be, although it is not intended as such, tantamount to a wrecking proposal, because it is such a small amount. Obviously, as we have discussed, this is a manifesto commitment. The fair work agency should be able to decide how much support it can offer, without being constrained to random financial limits for no good reason.

Amendment 272E would create an additional process before the power can be used. Part 5 of the Bill already calls for the fair work agency to publish an annual strategy, as we discussed on an earlier group. Requiring yet another administrative document in this way would be burdensome and unnecessary, and I think we share across the Committee a desire to reduce bloated bureaucracy—a phrase that has already been used this afternoon.

Turning to Amendment 272F, the powers under Clause 114 will operate in tandem with those in Clause 113, but workers will not always want to be separately represented in proceedings brought by the fair work agency. They can be represented, but they do not have to be. Therefore, we cannot support this amendment.

Amendment 272G would mean that the fair work agency would duplicate ACAS’s existing responsibilities regarding dispute resolution. This power is not intended to be a replacement or a duplication of existing support. We cannot support this amendment, as it would complicate the enforcement landscape when we are trying with this Bill to simplify it.

Amendment 272H would limit the scope of this power. It would create situations where legal assistance would have to cease, even if proceedings continued, leading to unfairness. It could lead to people being unable to continue their cases, which could cover other matters such as discrimination, because support could no longer be offered. The fair work agency should be able to decide what is appropriate and fair in each case.

Amendment 272I would put an unnecessary burden on the Secretary of State to have insurance in place before being able to provide advice on a settlement agreement. To be fair to the noble Baroness, Lady Coffey, she sort of indicated uncertainty around this. To be clear, this amendment wholly contradicts established government practice. I refer her to paragraph 4.4 of Managing Public Money, which sets out that the Government should generally not take out commercial insurance and it is not good value for money.

To summarise on Clause 114, the legal system can be intimidating, particularly for vulnerable workers or those from marginalised backgrounds. To repeat what my noble friend Lady Jones said in the previous group, many vulnerable workers are reluctant or unable to bring their cases to tribunal to enforce their employment rights, and this has serious consequences. Rogue employers exploit this, breaking employment law, and get away with it. For instance, Citizens Advice suggests that high-paid workers are more likely to file a case with an employment tribunal than lower-paid individuals, despite the latter being more likely to have their rights infringed. As I said, this lets rogue employers off the hook, and that is unfair for the vast majority of businesses, which we all know do the right thing by their staff and want to. It is unfair for the vulnerable workers involved—to state the obvious—who are being denied their rights, and it is unfair for the rest of the workforce, who are denied work opportunities due to illegal practices undercutting them.

As was said in the last group, that is why, in the plan to make work pay—again, a manifesto commitment—we set out that the fair work agency will have powers to bring civil proceedings to uphold employment rights. The Bill will give the fair work agency the power to bring civil proceedings in the employment tribunal to uphold rights. This is a critical power, particularly for situations where a worker feels unable to bring proceedings themselves. But there are occasions where a person is able to bring proceedings in the tribunal or another court but needs assistance, or where the case has wider ramifications and the person concerned could benefit from the fair work agency’s expertise.

[Lord Hunt of Wirral (Con)]

My Lords, can the Minister remind us to what extent there has been consultation with the Secretary of State for Justice? Has the Lord Chancellor been involved in putting together this scheme, which is going to sit alongside legal aid, for which she is responsible? It would be really helpful if the Minister could make sure that the Government is joined-up in putting forward what is, in a way, as my noble friends have pointed out, quite a blank cheque, which has not properly been costed. Can he put us right on all this, please?

[Lord Katz (Lab)]

I am more than happy to. The noble Lord, Lord Hunt, anticipates the comments that I was just about to come to—but we can address the point now. The noble Lord, Lord Jackson of Peterborough, focused on this as well. This is not expanding legal aid. The power is intended to give the fair work agency a discretion to provide support in employment-related cases. It is not an alternative to legal aid and it will be used in specific cases. The Government will set out how and when the fair work agency will exercise its power in due course and will discuss this with a range of stakeholders. I reassure the noble Lord, Lord Hunt, we have regular conversations with the Ministry of Justice, including on the Bill’s implementation.

I return to what I was saying about the importance of ensuring that the power of legal advice is appropriately bounded. It cannot be used to fund dispute resolution facilities delivered through other routes. Importantly, the clause protects the integrity of the courts and tribunals by confirming that nothing in the clause overrides existing restrictions on representation imposed by legislation or judicial practice. This clause complements the fair work agency’s wider role in promoting access to justice and fair treatment in the workplace. It provides a vital lever for supporting individuals who might otherwise face legal barriers alone or for ensuring compliance with relevant law, and it delivers our manifesto commitment on which Members in the other House were elected.

The noble Baroness, Lady Noakes, asked about the costs. These will be set out in due course and will be discussed with a range of stakeholders, particularly employers, trade unions and employees.

[Baroness Noakes (Con)]

That was a rather surprising statement. Is the Minister saying that these costs are not included in the estimates that have already been given for the costs of the fair work agency, which were included in the various documents surrounding the Bill? He has just implied that it will be done later. It is rather extraordinary to produce a clause in a Bill without having a costing for it. Can I press him again on what the costs are, whether they are included in the existing estimates of costs for the fair work agency and, if not, when they will actually be made clear?

[Lord Katz (Lab)]

I thank the noble Baroness for that intervention. The costs are not factored in. As I said, they will be set out in due course, following discussions with a range of stakeholders. I hope that this has persuaded the noble Baroness that Clause 114 should stand part of the Bill.

I turn finally to the amendments on recovering costs for legal assistance. Regarding Amendment 272J, if an individual has received free legal assistance from the fair work agency, any cost award should be returned to where that assistance came from. To be clear, a cost award is separate from any other awards a tribunal may make in favour of an individual. This amendment will prevent the fair work agency recovering costs and could lead to situations whereby individuals receiving legal assistance could receive money for costs they had not incurred. I hope noble Lords will agree that this is completely unreasonable.

On Amendments 272K and 272L, removing the ability to provide for the appointment and expenditure incurred is unreasonable and could lead to uncertainty about what expenditure of the Secretary of State is recoverable. In addition, while Amendment 272L looks consequential to Amendment 272K, it would actually remove the requirement for regulations under Clause 115(5) to be subject to any parliamentary procedure. I am sure that this is not the intention of the noble Baroness, Lady Coffey. Needless to say, we oppose removing requirements of parliamentary procedures in this way.

In response to noble Baroness’s question on why the regulation for Clause 115(5) is negative, this follows precedent from the Equality Act. I indeed note and point out to the noble Baroness that the Delegated Powers and Regulatory Reform Committee has raised no concerns with the Government about this power.

The legal assistance powers within the Bill are necessary to deliver our manifesto commitment to strengthen enforcement and improve outcomes for workers through a fairer, more acceptable system. These amendments would hamper that goal and might even unintentionally limit access to justice. The current drafting has been carefully considered. It is both deliberate and necessary. I therefore ask the noble Baroness, Lady Coffey, to withdraw Amendment 272BA.

[Baroness Noakes (Con)]

In the case of the noble Lord’s response to this group of amendments, and the response to the previous group of amendments by the noble Baroness, Lady Jones, the Ministers have claimed that these clauses are covered by manifesto commitments. The Labour Party manifesto is not something I carry around in my handbag, but, from memory, I do not think it covered these particular clauses. What makes me so sure that this is the case is that these two clauses were introduced in the other place on Report. They were not part of the original Bill that was introduced. That means, inter alia, that they received no substantive examination or discussion whatever in the other place. More importantly, this suggests to me that they were not a part of the original package that can claim manifesto support. I think we will want to examine that extremely carefully. If the Minister has a response now, with a chapter and verse in the manifesto, I will be happy to look it up afterwards, but I think we find unconvincing this part of the Government’s defence of these clauses.

[Lord Katz (Lab)]

I do not have chapter and verse but a page number. Noble Lords can find it on page 16 of the Labour’s Plan to Make Work Pay document, which was part of our manifesto.

[Lord Jackson of Peterborough (Con)]

I must press the Minister. I have looked at the Labour’s Plan to Make Work Pay document and it does not make reference to de facto legal aid. It says:

“We will also consider measures to provide accessible and authoritative information for people on their employment status and what rights they are owed, tackling instances where some employers can use complexity to avoid legal obligations”.


That is very different to what the Minister has outlined to your Lordships’ House.

[Lord Katz (Lab)]

I do not want to extend the debate too much or do too much quoting across the Dispatch Box but, to counter that, Labour’s Plan to Make Work Pay talks about establishing a single enforcement body that

“will have the powers it needs to undertake targeted and proactive enforcement work and bring civil proceedings upholding employment rights”.

To a fair-minded person that is pretty clear.

[Baroness Coffey (Con)]

My Lords, this has been an exceptionally revealing debate on this group of amendments and the clause more broadly. I somewhat agree with the Minister on creating the ability to initiate legal proceedings—which, by the way, continues some of the work already being done by the existing authorities—but the Bill does not refer to being able to do that without the consent of the worker, which will surprise a lot of people, and absolutely does not make reference to the level of financing, which we have just discussed in relation to Clause 114.

Another point I noted is that, on Monday, the Minister, the noble Baroness, Lady Jones of Whitchurch, referred to “employees and employers”, but the Minister at the Dispatch Box today has been very clear that this is also about funding trade unions. As I said, this has been a revealing debate and one that, after I discuss it with my Front Bench, we may explore further on Report. With that, however, I beg leave to withdraw the amendment.

--- Later in debate ---

[Lord Katz (Lab)]

I thank the noble Lord, Lord Paddick, for tabling Amendments 279ZA and 279ZB and the noble Baroness, Lady Hamwee, for her Amendment 273PA. I reflect that on an earlier group we heard from the noble Lord, Lord Jackson of Peterborough—whom I am glad to see now in his place—with his Amendment 273PB, so we have seen two ends of the spectrum in terms of an approach to information sharing and enforcement with modern slavery. One might speculate that perhaps we have, in a Goldilocks way, achieved the right balance with what we are proposing in the Bill. I hope noble Lords agree.

Turning to Amendment 279ZA and 279ZB, I understand that these are probing amendments and the noble Lord is seeking reassurances that the Gangmasters and Labour Abuse Authority’s vital work tackling labour abuse will continue under the fair work agency. Let me provide that reassurance very clearly now. Action on labour abuse and modern slavery will be core and central to the mission of the new fair work agency. I am happy to join in the sentiment set out by the noble Lord, Lord Hunt of Wirral. Modern slavery is a stain on our society as well as on our economy. We are determined as a Government to continue the work of previous Administrations in stamping it out. My noble friend Lady O’Grady of Upper Holloway set out very starkly for us why this continued exploitation needs our continued focus and vigilance.

All the Gangmasters and Labour Abuse Authority’s functions, including in relation to labour abuse, will transfer to the Secretary of State. Its vital work in this area will continue. We are also committed to ensuring that there is no disruption as we set up the fair work agency. The fair work agency will continue to work in close partnership with Eleanor Lyons, the Independent Anti-Slavery Commissioner, as the GLAA does now, to identify and disrupt patterns of exploitation across sectors such as agriculture, construction and adult social care. The Bill lays the foundation to build on that successful working relationship between the commissioner and the GLAA. Clause 132 and Schedule 9 together will enable the two-way sharing of information between them where this will help both fulfil their statutory functions. To address the questions from the noble Lord, Lord Paddick, the fair work agency will still have first responder status and a duty to notify.

Regarding Amendment 273PA in the name of the noble Baroness, Lady Hamwee, I appreciate the noble Baroness’s concerns but there is a need for information to be shared with the Home Office to help protect the public, including vulnerable migrants, from harm. The need for this was recognised by Parliament in the Immigration and Asylum Act 1999. Mechanisms already exist to support those of insecure immigration status who may be victims of abuse. The national referral mechanism is in place to ensure that individuals can be properly identified and supported, as mentioned by the noble Lord, Lord Paddick. The NRM is a framework for identifying and referring potential victims of modern slavery and ensuring they receive the appropriate support. The online process allows first responders to submit an NRM referral through a single online form, regardless of their location in the UK or whether the victim is an adult or a child. This provides a structured and compassionate route for potential victims of modern slavery to receive help without fear of immediate immigration consequences.

I am concerned that creating a legislative blocker to information sharing could have unintended consequences and make it harder for the vulnerable individuals concerned to get the help that they need and deserve. My department will continue to work with the Home Office to ensure that we strike the right balance between protecting vulnerable workers and maintaining the integrity of our immigration system. I therefore ask the noble Baroness, Lady Hamwee, to withdraw Amendment 273PA.

[Baroness Hamwee (LD)]

My Lords, I am grateful to the noble Baroness, Lady O’Grady. I was not surprised that she was able to produce that example; there are lots of examples.

I say to the noble Baroness, Lady Coffey, that there is data protection for a good reason. I cannot say that the current situation “breaches” it, as it is not illegal, but it does not observe that data protection.

The noble Lord, Lord Hunt, is of course right about human rights abuse. He used the important term “safeguarding”. Obviously, I am disappointed with the response from the Minister—I will have a good read of it. I think we might be returning to this issue in the next Home Office Bill that is coming to us—the noble Lord, Lord Hanson, has not reacted.

With regard to my noble friend Lord Paddick’s amendments, I still do not follow quite how the assurances can be implemented. I ask the Minister—though perhaps I shall go back to Dame Sara Thornton and the Rights Lab to be sure that I have not got it wrong—to write to my noble friend and me explaining just how those assurances work their way through in the legislation, because to have just the assurances without a statutory underpinning seems not to be enough.

Having said that, I beg leave to withdraw the amendment.

Employment Rights Bill

Lord Katz Excerpts

Committee stage
Tuesday 10th June 2025 Lords Chamber

[Lord Sharpe of Epsom (Con)]

My Lords, this amendment would introduce necessary and proportionate safeguards to ensure that patient safety, clinical operations and infection control were not compromised by well-intentioned but potentially disruptive physical access to hospital environments by trade union representatives. Hospitals are not ordinary workplaces. They are places where critical decisions are made every minute, where vulnerable patients receive life-saving care and where medical professionals must operate in conditions that are tightly controlled in terms of both hygiene and procedure. Permitting physical access to union representatives who are not part of the clinical team and not governed by the same professional or ethical codes introduces risks that simply cannot be ignored.

These are not theoretical concerns. Infection control protocols exist precisely because hospitals deal daily with immunocompromised patients, open surgical wounds and the spread of dangerous pathogens. Entry by any individual not trained in and accountable to those protocols could result in the transmission of infections, the contamination of sterile areas or the unintended exposure of patients to harm. Moreover, hospital environments are highly sensitive to disruption. In intensive care units, emergency departments, operating theatres and maternity wards, even small delays or distractions can have life-or-death consequences. The presence of non-essential personnel in those spaces risks delaying clinical teams, congesting movement corridors, or interfering with time-critical procedures.

Physical access is not just a logistical matter; it can be a direct threat to a hospital’s ability to function safely and effectively. The amendment does not seek to deny trade unions the ability to communicate with members or fulfil their lawful functions. On the contrary, it would explicitly allow access to be withheld only where the access purpose could reasonably be achieved by alternative means; and in the 21st century, such alternatives, as we heard last week, are abundant. Virtual meetings, secure digital communications, designated liaison officers or scheduled engagement in non-clinical areas would all be viable channels for meaningful trade union engagement.

Hospitals are already under enormous pressure, so it is neither safe nor fair to expect them to open their most sensitive environments when those same objectives can be achieved by safer, more appropriate methods. Hospitals also bear legal and regulatory duties that cannot be suspended. Clinical professionals are legally obliged to safeguard patients and maintain secure environments. To require hospitals to grant physical access to non-clinical actors where such access could conflict with those duties would place hospital management in a difficult, nay impossible, position, risking litigation, regulatory sanction and, above all, the trust of the public.

The amendment further recognises the importance of proportionality. It does not seek to impose an outright prohibition; it would simply require the Central Arbitration Committee, when deciding on access disputes, to give significant weight to those clinical and operational factors. That is the right balance, respecting the legitimate role of trade unions while upholding the sanctity of hospital care. To oppose this amendment would be to ignore the distinct and high-stakes nature of hospital environments. No one disputes the value of union representation, but the right to organise must never override the duty to protect.

Hospitals are not platforms for industrial theatre; they are sanctuaries of healing staffed by professionals who need order, safety and focus to save lives. We have a duty to shield them from any policy that risks disrupting that mission. I urge the Committee to support the amendment and uphold the principle that access, however important, must never come at the expense of patient welfare. I beg to move.

[Lord in Waiting/Government Whip (Lord Katz) (Lab)]

I thank the noble Lord, Lord Sharpe of Epsom, for his amendment and I hope, perhaps, that the lack of contributions means that we will make some good progress in Committee today.

[Lord Sharpe of Epsom (Con)]

We have been making progress.

[Lord Katz (Lab)]

On the noise from a sedentary position, I mean in numerical terms, if not in substantive debate.

As the noble Lord, Lord Sharpe of Epsom, just outlined, Amendment 213AA seeks to makes specific provisions for access into hospital workplaces by specifying circumstances in which access may be reasonably refused. It also requires the CAC to consider and give more weight to these factors when deciding on access.

As we discussed last week, the Secretary of State will be able, through regulations, to set the circumstances that the CAC must take into account when making decisions on access, including potentially complex access arrangements in workplaces such as hospitals and other healthcare settings. These areas of detail will be subject to public consultation before the regulations are made and we will invite all interested parties to provide their views on these matters when we launch our consultation.

It is a complex policy area that will involve detailed practical considerations. It is not as though, at the moment, we do not have strong and healthy engagement with a number of different trade unions in all manner of healthcare settings, including hospitals. We have trade union access, involvement and activity in complex workplaces, including hospitals. Special consideration is given to the importance of keeping them sterile and safe, particularly for those who have immunocompromised conditions and, indeed, anybody who is a patient in that setting. This can and has been achieved, and it is perfectly reasonable for the CAC, following consultation, to make regulations that set this. As I said, this is not a policy area that is not already well rehearsed and understood.

The noble Lord, Lord Sharpe, is right that hospitals are particularly special settings but they are also workplaces. The NHS employs large numbers of people and has a very mature industrial relations framework within it. It is certainly not implausible that, in consultation with all interested parties, the CAC could come to a perfectly reasonable compromise on access.

The Government also feel that it is not appropriate to make specific provisions for just this one kind of workplace—hospitals—prior to consultation. We are talking about hospital workplaces as opposed to, say, general practitioner or dental surgeries or other areas where you have regard to clinical safety and the sorts of considerations that the noble Lord talked about. Given that, I ask him to withdraw his amendment.

[Lord Sharpe of Epsom (Con)]

I am grateful to the noble Lord for his answer, but a little disappointed. His words largely give away why the Government should accept this amendment. I believe he just used the phrase “reasonable compromise” with regard to the Central Arbitration Committee, whereas the amendment just says

“must give significant weight to the factors set out in subsection (2A)”.

The practical impact of both those phrases is much the same.

So I am disappointed that the Government have chosen to reject this amendment, which is modest, carefully constructed and aimed at protecting one of our most vital public services. We were not asking for a sweeping exclusion, nor undermining the rights of trade unions or seeking—to use the noble Lord’s phraseology—to restrict involvement. We proposed a targeted safeguard that simply recognises the unique, high-risk nature of hospital environments. I will not press the point now, but we reserve the right to return to this in due course. For now, I beg leave to withdraw.

--- Later in debate ---

[Lord Katz (Lab)]

No, the noble Baroness got it right.

[Baroness Jones of Whitchurch (Lab)]

These amendments seek to delay when unions would be able to request access during the recognition process until after the bargaining unit had been agreed or determined. While I understand what the noble Lord is attempting to achieve with these amendments, employers have access to the workforce throughout the recognition process. The Government’s view is that unions should have access to the workplace as well from the point where the CAC accepts the application for recognition. This enables the unions to also have access to the workplace for a time closer to the start of the recognition process.

Amendments 215FG, 215FH, 216GA and 216MA seek to remove specific unfair practices from Schedule 6. They seem to seek to allow employers or unions to make an outcome-specific offer or use undue influence with a view to influencing the recognition application. These unfair practices are of long standing and are already set out in the legislation currently in force. The use of undue influence could, for example, include the threat or the use of violence. We therefore see no argument for removing these prohibitions on these unfair practices.

Amendment 216 seeks to reverse changes in the Bill by reinstating the requirement that unions meet the 40% support threshold in addition to a majority in a statutory union recognition ballot. I remind noble Lords that this was a manifesto commitment set out clearly in our plan to make work pay. We are committed to strengthening collective bargaining rights and trade union recognition. We believe that strong trade unions are essential for tackling insecurity, inequality, discrimination, enforcement and low pay. Our view is that the existing legal framework needs to be simplified so that workers have a more meaningful right to organise through their trade unions.

To achieve this, we are removing the current requirement for a union to have at least 40% of the workforce in the proposed bargaining unit supporting union recognition. In future, unions will need only a simple majority in a recognition ballot to win. We believe that the 40% support threshold represents too high a hurdle in modern workplaces, which are increasingly fragmented.

Amendment 216KA seeks to ensure that an employer is not prohibited from taking action against the worker for meeting or indicating that they would like to meet unions during the statutory recognition process if the worker has breached any term of their contract of employment. The prohibition that this amendment seeks to amend is carried forward from the existing legislation, where the proposed proviso about the worker not having breached their contract does not appear. While well intentioned, this amendment is not necessary. The prohibition applies only where the employer takes action against the worker solely or mainly on the grounds that they met with the union. It does not apply where the sole or main purpose is another reason, which may, in some circumstances, be a breach of their contract of employment. I hope this provides the necessary reassurance to the noble Lord.

I therefore thank the noble Lords, Lord Sharpe and Lord Hunt, for the debate and for tabling these amendments, but I must ask the noble Lord not to move the amendments.

Employment Rights Bill

Lord Katz Excerpts

Committee stage
Thursday 5th June 2025 Lords Chamber

[Lord Hunt of Wirral (Con)]

My Lords, I start by saying how pleased we are to see my noble friend Lord Holmes of Richmond in his place. I had the privilege of moving his previous amendments in his absence, but we are delighted to see him back with us and I thank him for proposing this important amendment.

The way my noble friend did it was very welcome because, at the heart of his speech, was a recognition that the labour market—especially the supply of temporary and agency workers—has to be fair and transparent. He used those particular words and stressed their importance. I agree with him that it is essential that all companies involved in these arrangements operate under the same clear set of rules. Too often, we see instances where umbrella companies or certain intermediaries do not meet the standards expected of traditional employment agencies, whether on pay, workers’ rights or transparency. This inconsistency undermines the integrity of the labour market and can put vulnerable workers at risk. Licensing could, in theory, help address this by ensuring that any business participating in employment arrangements meets minimum standards and is subject to proper oversight.

However, as my noble friend Lady Coffey stressed, the amendment raises some other important questions. Clause 34 broadens the definition of “employment business” to encompass a range of activities connected to supplying workers who are employed by one party but work under the control of another. This means that the regulatory net will be set much wider than before, potentially to cover businesses beyond traditional recruitment agencies.

Moreover, it is worth considering whether the same objectives could be achieved through improved enforcement of existing regulations rather than by introducing a new licensing framework. In this Chamber, we have to weigh carefully the costs and benefits, particularly to smaller businesses that may struggle with additional compliance burdens. We must also consider the impact on businesses and the wider economy. Many employment businesses operate with tight margins; for them, licensing means added costs, added paperwork and longer lead times to launch new services or respond to labour demand.

This is not an argument against regulation per se; it is simply a recognition that badly designed or poorly phased licensing can create barriers to entry, reduce competition and even push some providers underground, where abuses are harder to detect. In sectors that are already experiencing labour shortages, such as social care, hospitality and logistics, the cumulative impact could be significant.

As my noble friend Lady Coffey pointed out, there is also the risk of regulatory duplication or conflict. Some sectors already have licensing or registration schemes; others are subject to sector-specific standards set by Ofsted, the Care Quality Commission or the Financial Conduct Authority. Without co-ordination, we risk creating overlapping regimes, with businesses subject to multiple audits, rival codes of conduct and inconsistent enforcement. Workers too may be confused about their rights and the mechanisms available for redress.

I also note that the amendment does not contain any provisions for parliamentary oversight or consultation. The power it seeks to create is broad and, while it is subject to the discretion of the Secretary of State, it is not constrained by any statutory duty to consult stakeholders. In a sector as economically important and socially sensitive as this, there must be consultation. Against that background, I look forward to hearing the Minister’s response.

[Lord in Waiting/Government Whip (Lord Katz) (Lab)]

My Lords, I thank the noble Lord, Lord Holmes of Richmond, for his amendment concerning the licensing of employment businesses. I join the noble Lord, Lord Hunt, in saying how nice it is to see him in his place this afternoon. I share the privilege that the noble Lord, Lord Hunt, noted as I responded to the amendments that were tabled in the name of the noble Lord, Lord Holmes, and these were on important issues that he was right to raise. As the noble Lord, Lord Hunt, said, these are around fairness, transparency, equity and the problems that some less than scrupulous umbrella organisations and employment agencies currently raise in the market. He is not raising unimportant issues.

As the noble Lord, Lord Hunt, has already noted, through Clause 34, the Government have sought to amend the definition of “employment business” in the Employment Agencies Act 1973, so that it includes the concept of employment arrangements. This expanded definition will capture so-called umbrella companies and place them in the scope of regulation. As your Lordships know, employment businesses are subject to regulation through the Conduct of Employment Agencies and Employment Businesses Regulations 2003, which were enforced by the Employment Agency Standards Inspectorate and subsequently will be enforced by the new fair work agency that Part 5 of the Bill creates.

The Government acknowledge that the current regulations are not appropriate for application to umbrella companies so, following consultation, we will set out a new regulatory framework that will apply to umbrella companies. In our view, these regulations are the most proportionate way of reducing non-compliance in the umbrella company market, without introducing a new regime that would add complexity for business. The creation of a licensing authority at this time would therefore not be appropriate. I am happy to say that on this rare occasion, we share the concerns of both the Opposition Front Bench and the noble Baroness, Lady Coffey, from whom we heard earlier on this amendment.

The regulation-making powers in the Bill have been carefully considered and included only where the Government consider it justified and necessary. We are not convinced that the amendment will provide additional benefits for businesses or workers significant enough to expand this power, as it proposes.

The Government want to take care to get the regulations right. We have heard throughout our wonderful time spent discussing the Bill in Committee so far that there is a balance to be sought between the burdens that we create through new legislation and regulation on businesses, including small businesses, and protecting the rights of workers. It is a balance we get right, and we want to make sure that we get regulations right in relation to the new definition of employment businesses in this case. Our focus will be on that, alongside the establishment of the fair work agency.

Taking all these factors into consideration, I therefore ask the noble Lord, Lord Holmes of Richmond, to withdraw his amendment.

[Lord Holmes of Richmond (Con)]

My Lords, I thank all noble lords who contributed to this short debate. I listened very carefully to the Minister, and I am extremely grateful to my noble friend Lord Hunt for his comments. His drafting pen is always both sharper and smarter than mine, and we all benefit from that. I thank him for moving my amendment on Monday in my absence, and I thank the noble Viscount, Lord Colville, for doing so on a previous group. I accept the comments at this stage and am very keen to see what might be possible between now and Report. But, for now, I beg leave to withdraw the amendment.

--- Later in debate ---

[Lord Hunt of Wirral (Con)]

My Lords, we all owe a great debt of gratitude to the noble Lord, Lord Faulkner of Worcester, and my noble friend Lord Parkinson of Whitley Bay, for introducing a fascinating debate. My own relationship with heritage railways goes back some 45 years, to when I participated in all those wonderful railways in north Wales. I took my daughter Daisy to the top of Snowdon in one of these wonderful train rides. Sadly, the Western Mail had a picture of Daisy and me driving the locomotive, illegally, with the headline, “Daisy drives Dad around the bend”. I shall never forget that.

Therefore, like my noble friends Lady Neville-Rolfe and Lord Mendoza, the noble Earl, Lord Clancarty, and the noble Lord, Lord Palmer of Childs Hill, I approach this debate with some degree of positive expectation, because the noble Lord, Lord Katz, is going to reply. If ever there was anyone who would understand the need for this amendment, it is the noble Lord, Lord Katz. Whether his brief will allow him to show that level of understanding, we will have to wait and see.

This amendment brings welcome clarity and common sense to an area where outdated legislative definitions risk interfering with well-established and valued community practice. Heritage railways and tramways are not industrial undertakings in the conventional sense. They are, overwhelmingly, charitable or volunteer-led organisations dedicated to preserving history, offering educational experiences and engaging communities, often in rural or heritage-rich areas. This amendment recognises the important distinction between exploitive industrial labour and safe, structured, voluntary participation. Many young people who volunteer on heritage railways gain practical skills, develop a sense of responsibility and form connections across generations. It is, for many, their first taste of civic engagement and teamwork and is often a path into engineering, public service or the arts.

By inserting this narrow and well-defined exemption into the 1920 Act, this clause would ensure that young volunteers can continue to participate safely and legally in activities that benefit not only themselves but the broader public. Importantly, this does not in any way dilute protections against child labour or weaken employment law. It simply makes sure that our legal framework does not unintentionally penalise or prohibit what is clearly a public good.

[Lord Katz (Lab)]

My Lords, my reputation seems to precede me on this amendment. I am very grateful to my noble friend Lord Faulkner of Worcester for tabling Amendment 201 and have enjoyed a slight diversion in subject matter on the Employment Rights Bill. It is truly a pleasure to be able to continue the discussions that I have had with my noble friend Lord Faulkner about the railways for many years, both inside and outside this House. My noble friend is a true champion of heritage railways across the whole piece, not simply on this issue. I pay tribute to his role as president of the Heritage Railway Association.

It has been fantastic to hear from a number of noble Lords, including the noble Earl, Lord Clancarty, the noble Baroness, Lady Neville-Rolfe, and the noble Lords, Lord Mendoza and Lord Palmer of Childs Hill, all of whom extolled the virtues of heritage railways in providing a positive way of involving young people in transport, industry and civic engagement—as the noble Lord, Lord Hunt, was just saying—as well as contributing to the tourist sector and the Government’s mission for growth. The noble Lord, Lord Parkinson of Whitley Bay, spoke very strongly about that, and, as he pointed out, it is the 200th anniversary of the railway this year. We are doing a lot to commemorate that, and heritage railways will have their own role in that. I pay special thanks to the noble Lord, Lord Parkinson of Whitley Bay, for being the first person to out me as a rail nerd in this debate, and the noble Lord, Lord Hunt, also had that pleasure.

The noble Lord, Lord Parkinson, took us on a little tour d’horizon of the Private Member’s Bill debate we had in this House on this topic a few years ago, and mentioned a number of heritage railways. I can speak of the pleasure I had as a young child travelling on the Ruislip Lido railway, which was small in scale but mighty in reputation for those of us in north-west London. The noble Lord is right to point to the virtues of heritage railways, both as an economic activity and in individual engagement.

As a Government, we recognise and support the valuable opportunities young people have through volunteering to do a wide range of different work activities, including on heritage railways. Obviously, it is important that these things are carried out in a safe way, with employers, organisers and volunteers supervising activities to make sure that risks are properly controlled. To give some background, I will say that noble Lords will be aware that the Health and Safety Executive is responsible for regulating health and safety at work, but, in the case of the heritage railways, the Office of Rail and Road is the enforcing authority. Both these regulators have considered carefully what powers they have and how these would be applied in the case of young people aged between 14 and 16 volunteering on a heritage railway.

The Employment of Women, Young Persons, and Children Act 1920, which my noble friend Lord Faulkner of Worcester referred to, is a long-standing piece of legislation intended to prohibit the employment of children carrying out high-risk work, such as construction in industrial settings. To be honest, amending or repealing it would not be a straightforward matter.

The law protecting children in the UK is also a complex area, and this amendment touches on not only health and safety protections but other legislation and local authority by-laws. These are all devolved matters in Northern Ireland, and this amendment would impose changes there too. The 1920 Act is old legislation; amending it should be considered only after a thorough review of the impact on other areas of law, as there may be unintended consequences. It is worth pointing out that the primary legislation governing child employment, including light work, is the Children and Young Persons Act 1933. Amending or repealing the 1920 Act would still leave the 1933 Act in place, which—together with any by-laws made under it by local authorities—limits children to undertaking only light work. So repealing the 1920 Act could have unintended consequences across a number of sectors, and a full impact assessment would be required.

As we have heard, modern health and safety legislation does not prevent children and young people volunteering on heritage railways. I was pleased that my noble friend Lord Faulkner of Worcester referred to the Heritage Railway Association survey, which demonstrated that there are around 800 under 16 year-olds volunteering on heritage railways across the country. There may be activities that are unsuitable for young volunteers to carry out—for example, safety-critical tasks such as train diving—but I am pleased to say that both regulators are very willing to work with the Heritage Railway Association, as we have heard from my noble friend Lord Faulkner of Worcester, to determine what sorts of activities would be safe, appropriate and suitable for young volunteers aged 14 to 16 to perform on the railways.

Of course, regulators should, and do, take a proportionate approach to enforcement action. It is worth noting that the last time the 1920 Act was used to support health and safety enforcement was in 2009. As my noble friend Lord Faulkner of Worcester told us, there have been no prosecutions under the 1920 Act, either of public bodies or private individuals, which proves that the status quo is not absolutely terrible.

The aim of this amendment is to remove any barriers to allow children to gain valuable experience volunteering on heritage railways and tramways. Nobody wants to see more young men and women developing an interest and, indeed, a career on the railway more than I do. It is not clear that there is an overwhelming amount of evidence that this legislation is creating any barriers and, as we know, many heritage railways run very successfully with young people volunteering in a wide range of activities to support those ventures.

Both the Office of Rail and Road and the Health and Safety Executive remain very willing to work with the Heritage Railway Association to develop additional guidance and, possibly, examples of good practice to ensure that young volunteers can continue to work safely in heritage railway settings. While this is a sensible and proportionate way forward to address this issue, I have heard the strength of opinion on this matter from across the Committee. I am more than happy and willing to facilitate a meeting with my noble friend Lord Faulkner of Worcester—other noble Lords may be interested—with the HRA, DfT, ORR and HSE to further pursue this issue. Without making any further commitments, I therefore ask my noble friend to withdraw this amendment for now.

[Lord Faulkner of Worcester (Lab)]

My Lords, when the Minister has his meeting with the Members of this House who are interested in this issue, I think he will need to hold it in quite a large room. I am very gratified by the strength and quantity of support that there has been for this amendment and issue from across the Chamber.

I intend to take up the Minister’s kind offer and I hope we can do that before we reach Report. If, by then, it is possible for there to be an understanding of how the law can be interpreted or possibly changed, it may not be necessary to come back on Report. However, I think the House as a whole would like the opportunity to express its view on Report, particularly in view of the very strong support in the Chamber this afternoon, if we do not have a solution by then.

Meanwhile, I thank everybody who has taken part. I thank my noble friend the Minister; my co-signatory, the noble Lord, Lord Parkinson of Whitley Bay; and all the other noble Lords who took part. I beg leave to withdraw the amendment.

--- Later in debate ---

[Lord Goddard of Stockport (LD)]

My Lords, I will be brief. This group of probing amendments relates to new provisions in the Bill concerning trade union access to the workplace. Amendments 208A, 209A, 210 and 210A would narrow the definition of access by removing or limiting references to communication with workers, including through digital channels. These changes would raise questions about how access is intended to operate in practice, particularly in light of evolving workplace models. It would be most helpful to hear from the Minister how these changes are expected to support the overall objectives of the Bill and whether they risk narrowing the scope of access in ways that may affect its effectiveness.

Amendments 209, 211 and 213 in this group would also address the application of provisions to small and medium-sized enterprises. Others, including Amendments 213AA and 213B, introduce specific considerations for sectors including healthcare—all very laudable and quite reasonable—or for the timing and method of access for those applications. These amendments appear to probe the balance between ensuring orderly access and managing operational pressures. Could the Minister clarify how the framework, as currently drafted, is expected to work in different types of workplaces as I have alluded to, and how it ensures that both the employers’ and employees’ work interests are taken into account?

[Lord Katz (Lab)]

I thank all noble Lords who have taken part in the debate on this group, and in particular I thank the noble Lords, Lord Jackson of Peterborough and Lord Sharpe of Epsom, the noble Baroness, Lady Noakes, and my noble friend Lord Hendy for tabling Amendments 208A, 209, 209A, 210, 210A, 211, 212, 213, 213A, 213B and 214.

Before we get into the detail, I will frame my remarks by pointing out that we have heard previously in this debate in quite heated tones a discussion of the role of trade unions in our society. From our perspective as a Government, and from my perspective—for what it is worth, I have been a member of a trade union all my working life—progressive legislation and reform, which we on this side have always tried to pursue through working with the trade union movement, have done much to improve not just the world of work and the rights of workers but the economy as a whole. We are proud of this progress and history. This Bill represents a further stride towards a successful, mature framework for employment relations in this country.

It is important when we talk about striking the balance between employers, unions and workers—in particular, between employers and workers—that we do not equate the two as having equality in terms of power dynamics. That is often missed from this debate. Many employees, whether they work in Amazon’s warehouses, an SME or a microbusiness, do not necessarily feel that they have the same equality of relationship with their employer as their employer has with them. That may be natural, but one of the roles of a trade union or employee representative is to level that playing field. It is always important when discussing trade union rights to bear that in mind.

In Amendments 209, 211 and 213, the noble Lord, Lord Jackson, and the noble Baroness, Lady Noakes, are seeking to exempt smaller businesses from Clause 56. The right of access is a key part of our wider commitment to strengthening workers’ voices in the workplace, enhancing their representation and ultimately improving working conditions through increased trade union membership, participation and dialogue. My noble friend Lady O’Grady of Upper Holloway ably illustrated why, in some cases, trade unions do not need any improvements to access because they have a perfectly good and amicable working relationship. It is worth noting that in roughly 30% of the cases referred to the CAC the applications have been withdrawn because there has been a voluntary agreement, and that is a very good thing to see. However, there are cases where there is not that level of co-operation and access, which is why the Government are legislating to provide it.

We have heard in debates on previous groups that noble Lords on the Benches opposite think that trade unions are a good thing and have a role in the workplace. I absolutely take them at face value on that. To have that role in the workplace, they need to have access to workers. We cannot be starry-eyed about this; not all employers behave as responsibly and open-mindedly as we all believe they should in creating access for employees to their representatives. That is why we are discussing these bits of the Bill tonight.

The policy we have developed has been designed to be fair, consistent and workable for all employers. We will consult on specific details of the framework before they are set out in secondary legislation, including with the CAC, and we encourage businesses and unions to share their views. I understand the points around legal ambiguity raised by the noble Lord, Lord Hunt of Wirral, but, in the previous group, we discussed the levels of granularity and specificity in a particular statement that it is proposed that employers should give to employees about their rights to join a trade union. I posit that, if we had had the level of detail that the noble Lord suggested, we would have had a similar level of discontent from Members opposite. That is of course their right, but I make the point gently that you cannot have it both ways.

I turn now to Amendments 212 and 213B. Amendment 212 would require that trade unions provide a request for access to a workplace in writing, and with more than 24 hours’ notice from the requested date and time that access would happen. Amendment 213B would introduce two additional factors for the CAC to consider when making a determination on whether access should occur: first, the method, frequency and timing of the access requested, and, secondly, whether the purpose of access could be reasonably met without physical entry into the workplace. The Secretary of State will, by regulations, be able to set the time period in which an employer is required to respond to a request for access from a trade union, as well as the form that the trade union’s request must take and the manner in which it is provided to the employer.

I will respond to the point raised by the noble Baroness, Lady Coffey, around the difference between this sort of trade union activity and organising for industrial action. As far as I am concerned, it is pretty obvious that this is about organising for recognition, where the legal conditions can be met, and indeed organising for recruitment and awareness for other very reasonable trade union activities, such as promoting health and safety at work, which we all agree is important and worthwhile.

The Secretary of State will also be able to set, through regulations, the circumstances the CAC must take into account when making decisions on access. These areas of detail will be subject to public consultation before the regulations are made, and we will invite all interested parties to provide us with their views on these matters when we launch our consultation. To pick up on the comments made by the noble Lord, Lord Jackson, he may find that 24 hours after the consultation is deemed to be just right, or indeed too short a period. That is the reason for this consultation, rather than just prescribing everything at this point in time. If we had prescribed it in the Bill, and it was less than 24 hours, I suspect that the noble Lord, Lord Jackson of Peterborough, would not be at all happy.

Amendment 214 was tabled by my noble friend Lord Hendy. The proposals in this amendment would make declarations by the CAC under new Section 70ZI(5) enforceable, as if made by the High Court, opening a greater possibility of an employer being found to be in contempt of court. I am happy to reassure my noble friend that new Sections 70ZH and 70ZK, which were introduced by the Government on Report in the other place, already provide for a strong remedy against employers who do not respect these new rights of access, mainly in the form of CAC orders but ultimately backed by serious financial penalties when necessary. As my noble friend Lady O’Grady of Upper Holloway said, these need to be serious financial penalties and they need to have heft. The new sections that were tabled on Report in the other place say that penalties can be linked to various metrics, such as annual turnover or, indeed, the number of workers employed in the liable entity. In the case of large companies, that would make a very serious penalty indeed. We do not want them to be fined; we want them to grant the access to trade unions and trade union representatives that their employees deserve. In our view, the available remedies are already powerful and proportionate. The Government do not consider it necessary to go beyond these.

Lastly, I turn to Amendments 210, 208A, 209A, 210A and 213A. The noble Lords, Lord Sharpe and Lord Hunt, are seeking in Amendments 210 and Amendments 208A to 213A to exempt digital forms of communication from the right of access policy. In response to the noble Baroness, Lady Coffey, that can be found in new Sections 70ZA(4)(a) and (b) in the Bill as it left the other place. This clause was designed for the modern workplace and with various working practices in mind. It is important that this clause provides for a digital right of access to ensure that unions can reach workers who may not work in a physical workplace, such as home workers or those who work in a hybrid manner. In my opinion, if I may be so bold, the noble Lord, Leigh of Hurley, answered his own point. As he acknowledged, in some businesses, it is not as simple—

[Baroness Lawlor (Con)]

I am a bit puzzled about how access to digital can work side by side with the protections we have for data security.

[Lord Katz (Lab)]

I was going to mention it later, but I reassure the noble Baroness, Lady Lawlor, that existing data protection legislation will continue to apply. I do not want to say that shrouds were waved, but there were a lot of quite fanciful hypotheses as to what digital access might involve. To be frank, as the noble Lord, Lord Leigh of Hurley, suggested—sorry to pick him out—it could simply mean that employers are, through their own email system, obliged to cascade a message from trade unions to their employees without the trade unions having direct access to the systems at all.

--- Later in debate ---

[Baroness Coffey (Con)]

Before the noble Lord moves on from that point, I am fully aware of where the reference to digital is in the Bill now. The point that I was trying to make to the Minister was to justify why, when the Bill was originally presented to the House of Commons—perhaps I should have been more specific—it was not mentioned at all. I believe it was not inserted in Committee, so it must have come somewhere on Report, but I cannot find any justification made by the Government for why they have added this digital communication when they had not put it in at either the introduction of the Bill or in Committee in the other place, when it has the most scrutiny at that end. I had hoped the civil servants might have sent him a note.

[Lord Katz (Lab)]

I assume my civil servants understand that I probably know the answer to that question—they might be right, or they may be wrong. To cast my mind to the inner workings of Committee in the other place, the reference in the Bill, as I understand it, is to communication with workers rather than explicitly to digital communication. I sometimes feel that I cannot speak for the way we examine Bills in Committee in this place, let alone in the other place.

We now have the opportunity to discuss, as we are doing, the fact that in the modern day, in 2025, the idea that access to a workforce would not include digital channels is, frankly, fanciful. Were we seriously to say, not to trade unions but to employees—to workers—that the only way that they could receive a message from a trade union or from an employee representative or, to turn it on its head, from an employer was on a piece of paper or in a one-to-one verbal communication, then I think we would all regard that as fanciful. There is a little bit of sophistry—

[Lord Leigh of Hurley (Con)]

Just to expand on this a little further, we are not arguing that unions should not have the right to communicate digitally with workers. That is not the issue; the issue is the right of access. The Government are asking the House of Lords tonight to pass legislation that will allow a third person the right to access an employee’s computer—let us imagine that it is an SME business, possibly run on only one computer, which may contain highly sensitive information; in my case, that would be market-sensitive information— without any controls, references or parameters. I invite the Minister to commit that, before Report, further consideration is made of what such right of access means and the limitations on that right of access. We are not trying to exclude communication to workers; we are just trying to find out the channels and protect SMEs from intrusive activities.

[Lord Katz (Lab)]

I am happy to write to the noble Lord with more detail, but this is one of things that will be set out in regulation following extensive consultation. I go back to the original point of principle that I made about levels of granularity in setting out specific channels: if we specify channels A, B and C, as soon as the Bill is published we risk finding that employers are actually using channels E, F and G, because that is the pace of technology as it develops, so we have to retain flexibility.

[Baroness Coffey (Con)]

Will the Minister write to me with a better, candidly, a more comprehensive answer than he has given so far in response to my questions? I would be very grateful.

[Lord Katz (Lab)]

I am very happy to write. I resist the idea that I am not being candid here. The noble Baroness may not like what I am saying, but the point stands. I am of course very happy to write to her and to the noble Lord, Lord Leigh of Hurley, with more detail.

In conclusion, we expect that, in many cases, employers and trade unions will be able to agree the terms on which access takes place, including for digital access. In the event that there is no agreement, the CAC can impose terms, including terms dealing with digital access. I repeat: the precise details of how this will work in practice will be set out in secondary legislation following further consultation. I therefore ask that Amendment 208A be withdrawn and that noble Lords do not press their other amendments.

[Lord Hunt of Wirral (Con)]

My Lords, first, I say to the House authorities that we greatly appreciate the way they have tolerated the fact that we have gone way beyond the normal rising time on a Thursday, particularly as we are sitting tomorrow at 10 am. In mitigation, I note that we have tried to truncate what is a hugely important group of amendments. There are many things that we would want to probe further, so we will have to return to this on Report.

I thank my noble friends Lord Jackson of Peterborough, Lady Lawlor, Lord Leigh of Hurley and Lady Coffey for their contributions. I was interested, as always, to hear the noble Lord, Lord Hendy, and the noble Baroness, Lady O’Grady, although I hope that she will mitigate the damage she may have done with her remarks about one of the biggest investors in the UK, Amazon.

[Lord Hunt of Wirral (Con)]

I am sorry about that discordant note, introduced into what has been a really useful day in Committee on this important Bill.

I hope that people outside will realise that we have been debating a group of amendments that were made at the last moment in the House of Commons. They have not had any scrutiny at all in Committee in the Commons. That is why this House has so much responsibility to ensure that, in a fast-moving digital world, we do not transgress in a way that places employers and employees in an impossible position.

I thank the noble Lord, Lord Goddard of Stockport. He asked some direct questions, but we have not yet had the answers to them. It may well be that the Minister will write generally to us all to respond to the points he did not have time to answer today. I appreciate that he has limited time too, but he might like to respond in writing to us all, covering the points that he has not yet been able to deal with.

[Lord Katz (Lab)]

I am very happy to write, particularly to the noble Lord, Lord Goddard.

[Lord Hunt of Wirral (Con)]

On that positive note, I beg leave to withdraw the amendment.

--- Later in debate ---

House resumed.

[Lord Katz (Lab)]

From our Benches, I thank the staff, the clerks and the Deputy Chairman for staying later than they usually would be required to do on a Thursday. I look forward to seeing noble Lords tomorrow.

Employment Rights Bill

Lord Katz Excerpts

Committee stage
Monday 19th May 2025 Lords Chamber

That backlog means that genuine cases of harassment and genuine grievances are not being heard. We have one case at the Free Speech Union in which someone is bringing a case for unfair dismissal to the employment tribunal. That case, which we heard earlier this week, has been scheduled for July 2027. That is how long you have to wait now for a case to be heard in the employment tribunal. Yet it is absolutely clear that in all sorts of ways, but particularly with this clause, the Government will massively increase the number of cases that are brought before the employment tribunal as a result of this Bill. Given the extraordinary extent to which the ET is overwhelmed, given the waiting list—someone said that it was one year, but it is longer; it is almost two years—

[Lord in Waiting/Government Whip (Lord Katz) (Lab)]

My Lords, I respectfully point out that we have now had more than two hours on this group of amendments and that we have just come up to 12 minutes for the response to this long debate. A fair person would say that this is excessive free speech. I respectfully ask the noble Lord to bring his remarks to a conclusion, so that we can make some progress.

[Lord Young of Acton (Con)]

I will bring my remarks to a conclusion. Sorry, I thought I had 15 minutes. I misunderstood.

Employment Rights Bill

Lord Katz Excerpts

Committee stage
Tuesday 13th May 2025 Lords Chamber

[Lord Bailey of Paddington (Con)]

My Lords, I support Amendments 127, 128 and 139 from my noble friend Lady Penn. I too am a father, so I have an interest in that regard. These amendments will be very useful to the poorest families in the country because currently, only the very well paid get access to serious paternal leave.

As someone who comes from a community that has suffered horribly from the absence of fathers, I know that an early intervention that ties a father emotionally, financially and in any other way to that family unit is very important. The impact it has on educational outcomes and the finances of the family into the future are hugely important. My community is more than three times more likely to be impacted by poverty and all the downsides that poverty inflicts because of that lack of an initial paternal connection to the family.

This country is also facing a very low birth rate. Many young men in this country will tell you that they cannot afford to have children. Paternity leave will be a big part of addressing that. So, supporting our birth rate in this country—addressing that demographic time bomb—is very important.

The mental health of men in this country has been poor for a very long time. Part of turning that around is improving how fatherhood is perceived, so that young men in particular lean into that role and take pride in being a father. That also has a strong knock-on effect for the women involved: they receive support in the home, and it helps them return to their own careers, as we have heard from so many Members of your Lordships’ House. In the poorest communities in this country, many of the real breadwinners in the household are the women. If they can be supported back to work, that will have a profound impact on the mental well-being of the entire family.

I have been on a personal journey to make this a day one right. Because of the profound effect that the lack of a father in the household has on many aspects of society, this should be a day one right. Basically, some things are just worth paying for, and if this has a cost to the Government, so be it, because the upsides, socially and financially, are massive and beyond measurement.

Lastly, as is well documented and as many noble Lords have already said, the benefits to companies are profound. The challenge will be the smaller companies, where one or two people form a significant proportion of the workforce. That is where this conversation has to be sold, where the rhetoric is important, because if smaller companies adopt this approach, I believe it will happen. Larger companies already know the benefits this has for their workforce.

[Lord in Waiting/Government Whip (Lord Katz) (Lab)]

My Lords, I beg to move that the debate on this amendment be adjourned.

[Noble Lords]

Oh!

[Lord Katz (Lab)]

My Lords, it has been agreed by the usual channels that we break at a time convenient for the Minister to make a Statement, thus allowing her to continue her other business outside the House.

Debate on Amendment 76 adjourned.

Moved by

[Lord Katz]

That the House do now resume.

[Lord Katz (Lab)]

My Lords, I beg to move that the House be resumed.

[Noble Lords]

Oh!

[Lord Katz (Lab)]

My Lords, if I felt we were able to finish the group in the next five minutes, that would be fine. We have had a good debate, but this is an important topic, and it is important that the Committee is able to finish the group by hearing from any other Back-Benchers who might wish to contribute, as well as from the Front-Benchers and the Minister. All of the Committee might not be aware of it, but we have agreed through the usual channels that we will have the dinner break early to accommodate the repeat of the Statement. We are ultimately in the whole Committee’s hands. That is why we are breaking now. I know it is not usual to break midway through a group, but, as I say, it has been agreed through the usual channels that a dinner break at 6.30 pm would take priority. Perhaps we can resolve this.

[Lord Sharpe of Epsom (Con)]

I have had confirmation from my side that the usual channels have agreed.

--- Later in debate ---

[Baroness Jones of Moulsecoomb (GP)]

Stop groaning.

Normally, if today’s list says, “at a convenient time”, that means at the end of a group surely.

[Lord Katz (Lab)]

As I said, I understand that this is unusual, but it is in no way unprecedented. We have broken in the middle of a group before. It is not ideal, but we are where we are. I think it is in the best interests of the Committee, especially as it has been agreed through the usual channels, to hear from both Front Benches and any other Back-Benchers on this group in good time, and to hear, in the meantime, a repeat of the Statement from the Minister, so that everybody gets the best of all worlds. I know this is not usual practice, and we will endeavour not to do it on future Committee days.

Motion agreed.

Employment Rights Bill

Lord Katz Excerpts

Committee stage
Tuesday 29th April 2025 Lords Chamber

[Noble Lords]

Front Bench!

[Lord Katz (Lab)]

I remind noble Lords that we are in Committee, not at Second Reading. We have heard a few speeches now that have strayed a little from the precise content of the amendments that we are speaking to. I urge noble Lords to concentrate on those amendments rather than making Second Reading speeches so that we can get on and make progress.

[Baroness Lawlor (Con)]

My Lords, I support the amendment moved by the noble Lord, Lord Fox, for reasons of transparency and clarity. As we have heard today, there is too much being added to the Bill. We have not had proper sight of the Government’s amendments until it is too late. How can any business plan for the future with this hotchpotch of a Bill changing by the day?

On top of that, I echo what my noble friend Lady Neville-Rolfe said and I would add a competitiveness and growth purpose here. We had it in the Financial Services and Markets Act. It helps to focus people’s minds on the law, on the overall purpose, on what we mean by the economy we run and on what its aims are.

I cannot agree with the noble Lords opposite who point out, with different conclusions, that our labour laws are streets behind those of European countries. Like the noble Lord, Lord Fox, I believe that the dynamism in Britain’s economy is due to it being a competitive market economy—one that has historically been open to trade and competes and, for that reason, can offer job security and good wages on a competitive basis. Part of that is a flexible labour market.

I am worried that this Bill—particularly given that the purpose is not economic growth and competitiveness—will stultify and freeze growth and, as a consequence, the labour market. The people who will suffer will be workers themselves, who will not get jobs or job security. For these reasons, I support the noble Lord, Lord Fox.

I close by remembering a German economist who worked under Chancellor Merkel in her global economics department at the time of the discussions around whether Britain would remain in the EU or leave it. This economist implored Britain to stay, because, without Britain, Europe would have a frozen economy, its labour market would lack dynamism and its competitiveness with the wider world—with the Asian and global markets—would stultify. It therefore seems very bizarre that we are trying to put the clock back on labour market legislation and stop the flexibility which should be at the heart of any dynamic market economy.

Employment Rights Bill

Lord Katz Excerpts

2nd reading
Thursday 27th March 2025 Lords Chamber

[Lord Katz (Lab)]

My Lords, it is a pleasure to follow my noble friend Lady Rafferty and to hear the outstanding maiden speeches of my noble and very good friend Lady Berger, and indeed my noble friend Lady Gray. I also congratulate the noble Baroness, Lady Cash, and the noble Lord, Lord Young of Acton, on their maiden speeches.

It is an equal pleasure to speak in this Second Reading debate on the Government’s flagship Employment Rights Bill alongside colleagues with huge experience of the realities of day-to-day trade unionism, not the flights of fancy we have heard from some Members opposite. I am not sure what the collective noun for trade union general secretaries and assistant general secretaries should be. Perhaps we on our Benches need to invent one. I would say a “negotiation”, but we can quibble over that.

For my own part, I am someone with experience of both sides of the negotiating table. I worked as a lowly political officer at the Transport Salaried Staffs’ Association, more recently for a FTSE-listed transport operator, and for small businesses in between. When hearing some of the contributions from the Benches opposite, I recall an earlier job. I had the privilege of working for my noble friend Lady Harman when we were campaigning on the blight of low pay in 1990s Britain and the need for a national minimum wage. As my noble friends Lady Hazarika and Lord Watson of Invergowrie reminded us, shrouds were certainly waved back then by the Conservative Government and some of their business backers about the devastating impact it would have. Next week, the national minimum wage will rise again, benefiting 3 million workers. Our economy did not collapse—it will not now.

Making work fair—which the Bill does—is so important in delivering not just a better economy but a fairer, more just and cohesive society. I could dwell on many individual elements of the Bill. My niche favourite is the decision to scrap the pointless hoop-jumping of regular political fund ballots, having organised some myself, but instead I will consider the societal benefits of making work fairer for individuals and giving trade unions more rights to represent working people when they are being unfairly exploited.

Research conducted by Warwick University has found that job-related ill-health is costing UK businesses up to £41 billion a year, with 1.75 million workers suffering due to poor job quality. This study highlights how job insecurity, low pay and long hours contribute to poor health outcomes for employees and how, conversely, the academics say, job security, fair pay and a healthy work/life balance are linked to better well-being—hardly surprising.

The number of people in insecure work reached a record high of 4.1 million last year. Contrary to the assertion by the noble Lord, Lord Hunt of Wirral, those workers do not want to be in a state of insecurity. According to a TUC poll of zero-hours contract workers, some

“84% want regular hours of work—compared to just … 14% who don’t”,

and:

“Three-quarters … of those polled say they have experienced difficulty meeting living expenses due to not being offered enough hours”.


But extending workers’ rights is not just good for workers. Making work more equitable, secure and meaningful is good for communities, too. That is why, as my noble friend the Minister said, the wider population, not simply those workers impacted, support the measures in the Bill. Polling from Hope Not Hate has found that

“72% of UK voters support a ban on zero hours contracts, … 73% support … protection from unfair dismissal”

and 74% support ensuring that all workers have the right to sick pay.

Hope not Hate polling also found that over half the people felt pessimistic about the future. We know from history that, when an economy is on its knees and people feel insecure and hopeless about their own future as well as the future of the country, it weakens community cohesion, leaving space and divisions which the far right is only too willing and able to exploit.

Insecurity at work breeds insecurity in our communities and our country. These reforms will make people feel valued and restore a sense of hope to the most marginalised in our society—and that can only be a good thing. In short, we need change and the Bill is a vital part of that positive change for millions of workers, their families and their communities.