Transparency of Lobbying, Non-Party Campaigning and Trade Union Administration Bill

Baroness Clark of Kilwinning Excerpts

Wednesday 11th September 2013 Commons Chamber

[Mr Djanogly]

I will come to the hon. Lady’s point— I might agree to an extent with some of what she says.

Let us put the measures in context. An emergency motion on the Bill, which was moved by Unison at the TUC conference, has called for an investigation of a policy of non-co-operation with the Bill. Considering the Opposition amendments, that is way over the top, particularly in relation to the part 3 proposals.

On the other hand, despite the Labour smokescreen, the part 3 provisions are something of a missed opportunity to reform the certification officer role, which has long been in need of reform. The key point is that the certification officer is not a true regulator of unions, as it should be. Rather, as the hon. Member for Edinburgh South (Ian Murray) has said, it is like Companies House. It checks that filings are made, but does not look at what is contained in those filings. There is a limited power of investigation, but only in relation to administrative matters.

Therefore, when I look somewhat more charitably at amendment 103, I note that it gives us the chance to debate what the underlying role of the certification officer should be, and to ask what is the purpose of the records kept by unions. Given the surprising reticence of the Government to set out their answers in much detail to date, the amendment serves a useful purpose.

The clause 36 provisions effectively retain the status quo—that originally created via the Trade Union Act 1984 and replicated in the 1992 Act. One has to look only at the obscure clause numbering in the Bill—it proposes new sections 24ZA to 24ZK—to realise that it is high time properly to review the legislation and, in effect, to start from scratch.

[Katy Clark (North Ayrshire and Arran) (Lab)]

Does the hon. Gentleman not accept that trade unions are one of the most highly regulated institutions in the country—far more so than, say, political parties, which do not have to produce the kind of information the Bill would require? Does he accept that that is because of the ideological wish, from certain people involved in politics, to regulate trade unions highly? That sits ill at ease with some of the comments made regularly by Government Members about cutting red tape.

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[Stephen McPartland]

I am not actually a member of trade union, and I never have been. [Interruption.] Hon. Members are tempting me to stray from the point. Within a few weeks, however, there will no doubt be an announcement and I will be working closely with one of the national unions, and I might well join it as a result of the work that we do together.

The perception of clause 36 is that it is a massive attack on the trade union movement, but that is not its purpose.

[Katy Clark]

The hon. Gentleman will be aware that we are one of the only European countries that does not have a right to strike. Clause 36 comes on top of a whole range of other pieces of trade union legislation, much of which has been designed to be used in the courts by employers trying to get injunctions to stop strike action. Often, when those cases come before a full court, the employers are unsuccessful, even though they might have been successful in getting the strike stopped at the initial stage. Does the hon. Gentleman think that this clause has been designed to create yet another hurdle for the trade unions to get over before they can take lawful industrial action?

[Stephen McPartland]

The short answer is no. Clause 36 introduces a duty to provide a membership audit certificate. I genuinely cannot imagine that many of the unions will be bothered by it. The reality is that they all want to know where their members are so that they can communicate with them. Most unions do not send letters out to their members simply asking them to take strike action. They also want to sell them services and to make the union a part of their lives.

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[Stephen McPartland]

I completely agree with the hon. Gentleman. The biggest challenge those unions face—it is perhaps a reason that the Bill might help them focus more resources on the issue—is simply the fact that people move home. It is not a matter of losing members of the trade union movement; it is simply a matter of trade unionists moving house between different areas. That creates a massive turnover. We all have experience of moving house and know we have to pay the Royal Mail a fee to redirect our mail for a year. Moving home is a big issue; it is one of the key problems surrounding the clause. Clause 36 encourages the focusing of more union resources on tackling the problems of membership turnover.

[Katy Clark]

Has the hon. Gentleman had an opportunity to look at how much this will cost the trade unions? Does he know how much they will have to spend on this exercise?

[Stephen McPartland]

The hon. Lady will be delighted to know that I read the impact assessment, so I understand that it will cost approximately 6p per member, which does not seem to be exorbitant. [Interruption.] I am sure we can argue about that when we get to a different part of the Bill, but I am going to keep my remarks focused on clause 36 as our Chairman would like—namely, the duty to provide a membership audit certificate. I keep repeating the point that clause 36 deals with a duty to provide a membership audit certificate. I do not see what the problem is with providing such a certificate. I cannot imagine why the unions would object to it.

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[John Cryer]

That is a very good point. We have had all sorts of debates in this place on blacklisting recently; it is a problem that goes back many decades and persists in many sectors today.

My next question for the Minister is whether there has been any assessment specifically of the effect of the future legislation on the sectors of the economy that are particularly casualised. I am thinking of construction, agriculture, hospitality and catering. In construction and agriculture, particularly, the fluid nature of the work force means that it is difficult to keep accurate records of membership.

I have worked for three trade unions in the past and trade unions, more now than at any time in their history, devote enormous resources—as many as they possibly can—to organising records and keeping them up to date. As I said when I intervened on the hon. Member for Stevenage (Stephen McPartland), large general unions, particularly Unite and the GMB, can easily lose 12% of their membership, particularly at a time such as this. Their membership tends to stand still because they can recruit another 12% in the same sectors to take the place of those members who have been lost because of jobs being lost, factory closures and so on, but just to stand still they have to recruit 12%. The level of churn means that it is difficult to keep records up to date, no matter how many resources are devoted to record keeping. Of course, up-to-date records are dependent on members informing the union that they have moved house, for instance, or changed occupation. That does not always happen.

[Katy Clark]

I congratulate my hon. Friend on how he is presenting his case. He is correct that unions put a huge amount of resources into trying to keep accurate membership records, especially because of the number of legal challenges that employers take against them in the courts. Does he agree that the changing nature of the work force, with the increase of zero-hours contracts and under-employment that means that people have more than one part-time job, makes it even more difficult for unions to keep accurate records?

[John Cryer]

I completely agree with my hon. Friend. There is also the situation involving payroll companies. If such a company offers to take over an employer’s payroll responsibilities, the duties to pay pensions, national insurance and sick pay are divested to that payroll company, meaning that that semi-detached element in the workplace is responsible for maintaining many records, which makes keeping everything up to date even more complicated and difficult. Another aspect is the casualisation of the workplace, because there are some sectors of the economy in which full-time permanent employment is almost being abolished. Again, that situation will make it more difficult to comply with the Bill’s strictures.

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[Mr Doran]

Two hundred trade unionists turned up to lobby us at the meeting we attended. The point I was trying to make, Mr Leigh, was about the relationship between a good union and a good employer.

My hon. Friend the Member for Leyton and Wanstead (John Cryer) raised union problems. There are two ways of looking at the matter. Either the Government do not know what the problems are, in which case they are negligent, or they know the problems and want them to be exploited. There are major difficulties in the path of any trade union that wants to keep proper records.

The first difficulty is the churn rate. My hon. Friend said that it was 10% or 15%, but the churn rate for the Union of Shop, Distributive and Allied Workers, for example, is 25% or sometimes 30%. Every year it has to replace 25% of its membership. A lot of members go on to other jobs. They pay their union dues by direct debit and think they do not need to bother to tell the union that they have changed workplace, because they are still working in the same business and paying their union dues. That is difficult for unions. There are lots of practical issues such as that.

The biggest employer in my area is the North sea oil and gas industry, which employs about 30,000 workers offshore and 150,000 onshore. All have different status in the workplace. Many union members are self-employed and many work from company to company. At the moment, there is a massive skill shortage in the North sea. Wages are being ramped up—not a problem in the rest of the country, I know—because people are being enticed to other companies, but still working in the same business, travelling on the same unsafe helicopters and paying their union dues as usual through their bank accounts. Those are all massive problems.

[Katy Clark]

My hon. Friend’s speech is most interesting. It is incredibly important to put these issues into context. Over recent years, unions have spent millions of pounds trying to ensure that they have the best possible membership records. They have also had to pay many millions of pounds to lawyers in defending those membership records in courts of law. Is that really what we want?

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[Ian Lavery]

There have been some fantastic contributions to this very important debate on part 3 of the Bill. The most important thing about the Bill has been addressed by my hon. Friend the Member for Aberdeen North (Mr Doran) in his conclusion and by my right hon. Friend the Member for Wentworth and Dearne (John Healey), who both said that it could be in contravention of the European convention on human rights. That is a huge issue.

The Bill was published eight working days ago, which has given no opportunity for any clear consultation. Indeed, there has been a complete lack of consultation. Usually, those who are affected by a Bill are at least asked to participate in some form of consultation, but that simply has not been the case. The TUC, which is hardly a beacon of militancy, should at least have been given the opportunity to express the views of its 7.2 million members. Others should have been given a similar opportunity.

That lack of consultation and the fact that the Bill is undoubtedly an invasion of privacy and freedom of association mean that there is a huge question mark over whether it is legal. I am convinced that there will be a legal challenge.

[Katy Clark]

I congratulate my hon. Friend on what he has said so far. Is he aware that Unison commissioned Michael Ford QC of Old Square chambers to provide it with legal advice? It has been shared with the Government and says that

“the Bill probably infringes both Article 8 of the European Convention of Human Rights (ECHR) with regards to the right to a private life and Article 11…with regards to the freedom of association.”

Will my hon. Friend join me in calling on the Minister to address those issues fully in her response?

[Ian Lavery]

I am fully aware of all the legal advice—it has been received not just by Unison but by other organisations—which clearly highlights the concerns about the Bill. The legal issue is very important and can be argued to and fro, as is always the case. However, if the legal profession have as many doubts about the Bill as it appears to have, surely it should have been put on the back burner in order to allow for consultation, legal advice and discussions with Members of all parties. Surely that is how we should operate in a democratic society. Of course, as my hon. Friend the Member for Blaydon (Mr Anderson) mentioned, the Bill is not about tidying anything up, but about hammering trade unions. It is about trade union baiting, which the press, the media and the Conservative Government are happy to do on an almost daily basis. That is atrocious, but we see it day after day.

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[Ian Lavery]

I accept that I have again been led astray, Sir Edward. Perhaps I should have said that I am getting back to the meat of the Bill.

In the past two years—it has been blatantly obvious in the past week or so—we have seen that the Liberal Democrats are dead. They have been absolutely blown out of the water. Congratulations to them—they have suicide notes and everything. Last night, they voted against the big society, charities that strive to do their best, and campaign groups like the National Union of Students, which will campaign against the Liberal Democrats in a big way. I hope that, because of how they voted last night, the campaign against them will become increasingly strong. Let us hope they get their just deserts.

Part 3 deals with trade union administration. As Opposition Members have said, British trade union legislation is the most restrictive in western Europe—it is anti-trade union legislation. The question is this: what does part 3 seek to resolve? We have received copies of the impact assessment study, but it was not available earlier and, unfortunately, hon. Members have not had the opportunity to read it. A consultation document on the measure is absent from the discussion.

Clause 36 creates a new duty on trade unions to send a membership audit certificate to the certification officer when they see each annual return. If the union has more than 10,000 members, the membership audit certificate must be provided by an independent assurer. Given the current legislation, why is that measure being introduced? The existing system is working. Under the 1992 Act, a trade union has a duty to maintain a register of the names and addresses of its members and a duty

“so far as is reasonably practicable”

to ensure that

“entries in the register are accurate and…kept up-to-date.”

The 1992 Act provides that a trade union should “allow any member”, on request, with

“reasonable notice, to ascertain from the register, free of charge…whether there is an entry on it relating to him”

or her. A failure to comply with the requirements of section 24 can be subject to an application either to the CO or the court.

The certification office annual report 2012-13 states that 166 trade unions submitted returns but not membership lists, recording a total of nearly 7.2 million members, compared with 7,261,000 members the previous year—the largest reduction in membership was in the construction sector. The annual return is to include a copy of the auditor’s report on the accounts, which allows the CO to compare revenue from dues with the numbers reported.

In 2012-13, the returns showed that income from members increased by 1.3% to £873 million. The returns also showed that 90.5% of the total number of members were contributing members, compared with a figure of 89.4% in the previous year.

There is nothing to fix here. Even if we accept the Bill, nothing will be fixed. The saying goes, “If it ain’t broke, don’t fix it.” Trade unions are duty bound to maintain a register of members’ names and addresses—this is important—so far as is reasonably practicable, as per the Trade Union and Labour Relations (Consolidation) Act 1992. I would have thought that anyone wishing to contribute to the debate had read section 24 of the 1992 Act.

[Katy Clark]

I congratulate my hon. Friend on his speech. He will be aware that a former leader of the Labour party called Britain’s trade union legislation the most restrictive in Europe. Is he surprised that Government Members are not jumping up to complain about red tape?

[Ian Lavery]

It is amazing. The Government are looking to cut red tape on industrial relations, health and safety and trade union law, but at the same time the only organisation for which they are looking to increase bureaucracy is the trade union movement. That is a fair point, which highlights what is really behind the Bill: another vicious attack on the trade union movement. In the main, it will be the ordinary person at grass-roots level who will have to make sure that the proposed legislation is applied.

Anyone wishing to take part in the debate should at least have read section 24 of the 1992 Act, as that is what the Bill is about. What on earth are we after? Section 24 states:

“Duty to maintain register of members’ names and addresses

(1) A trade union shall compile and maintain a register of the names and addresses of its members, and shall secure, so far as is reasonably practicable, that the entries in the register are accurate and are kept up-to-date.

(2) The register may be kept by means of a computer.”

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[Jo Swinson]

If that is how the hon. Gentleman describes my answer to his hon. Friend, I would be interested to hear how he would describe several of the speeches we heard during the debate.

Trade unions have a significant impact on the lives of people in our country. We want to ensure that their membership lists are up to date, and everyone has an interest in that being achieved. As hon. Members have said, we know that that can often be a challenging process, for good reasons, so we want to provide assurance that it will happen.

Clause 36 will give wide assurance that unions know how to contact their members so that their decisions will reflect what their members want. We do not want to change the vital and positive role that unions play in society, but we do want to give confidence in their accountability.

Under section 24 of the Trade Union and Labour Relations (Consolidation) Act 1992, unions have to ensure that their lists of members’ names and postal addresses are accurate and up to date

“so far as is reasonably practicable”.

That section allows any union member to find out whether there is an entry relating to him or her and to see a copy of the information. Clause 36 builds on that by making unions give the certification officer an annual membership audit certificate alongside the annual return that they already submit. Clause 37 provides that a union with more than 10,000 members will have to appoint an independent assurer to produce the certificate, as well as setting out what is required for that process, but clause 36 states what smaller unions with fewer than 10,000 members will have to do. They will be able to have a union officer sign off the certificate with a statement that, to the best of their knowledge, the union has complied with its duties under section 24. I hope that the Committee will agree that that is a pretty light-touch approach and that the duty is not onerous in the slightest. Of course, we expect that smaller unions will have a less complicated register, so it is reasonable that a union officer would know the content well enough to be able to make such a statement.

As the clause is designed to give widespread assurance, all unions of any size will have to let anyone who asks to see their most recent certificate to do so, for which they may charge a reasonable amount, if they want. The certification officer will have to keep copies of all certificates and to allow the public to look at them. Subsections (3) and (4) allow a trade union to fulfil the new duty on behalf of its branches and require that federated unions comply with the new duty. Our aim is not to change what unions should already be doing to maintain their membership data, but to get them to provide assurance of what they are doing to their members and the public.

[Katy Clark]

rose—

[Lady Hermon]

rose—

[Jo Swinson]

I shall give way to the hon. Member for North Ayrshire and Arran (Katy Clark) and then to the hon. Member for South Down.

[Katy Clark]

The Minister said that unions have some influence and she is trying to give assurance. Does she accept that trade unions and trade union members have very little power in society compared with many other organisations, such as multinationals and other vested interests? Does she not think it is inappropriate that she is focusing on this area rather than trying to give all of us more assurance that some of those other organisations which hold massive power in society are brought into check?

[Jo Swinson]

The hon. Lady raises a point that others have raised, which I will come to in my remarks about the regimes that are in place for different types of organisations. The trade unions have their particular tailored regime, which is appropriate. We would not necessarily want the same regime to apply to charities, trade unions and political parties. It is appropriate that we have systems in place that deal with those particular organisations.

I said that I would give way to the hon. Member for North Down—apologies for getting the constituency name wrong.

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The hon. Member for Bolton South East (Yasmin Qureshi) accused the Government of insulting the unions and failing to recognise the benefits that they bring. I want to be absolutely clear, as I have been in previous statements to the House, that I agree that unions play an important role in the workplace through training and representation. The media and a lot of the debate focus on industrial action, but that is not representative of the role that trade unions play. All the provision does is require an assurance that existing obligations to keep members’ names and addresses up to date are properly undertaken. It is a reasonable and modest change that is pretty hard to disagree with.

[Katy Clark]

Does the hon. Lady not accept that there is a suspicion that the issue is about industrial action? If the assurer is to prepare for the audit and certification, surely that process could be challenged; it would be yet another matter that could be brought up in the context of an employer’s seeking an injunction to stop industrial action of some sort. Is she not simply creating more avenues for litigation?

[Jo Swinson]

The short answer is no. The longer one is that the case law is clear. As has been outlined in the past two or three years, small and inadvertent errors that would not have affected the outcome of a ballot are not grounds for an injunction, and it is right that that should continue.

[Katy Clark]

rose—

[Jo Swinson]

I want to make progress, because we want to scrutinise other elements of the Bill today.

My hon. Friend the Member for Stevenage (Stephen McPartland) made a powerful contribution. He mentioned that social pressure can be applied to make people go on strike; those at the workplace who are not members of a particular union may be affected by industrial action. They might be an example of those who would like reassurance about the updating processes for the membership lists.

The right hon. Member for Wentworth and Dearne (John Healey) asked whether we would commit to publishing legal advice. As he will know from his time as a Minister, the convention is that the Government do not publish such advice. I am, of course, happy to give reassurance on his point. Clause 36 requires the provision of the certificate but will not contain information about individual members, so the article 8 right to privacy is not breached. I am sure that when we discuss the next group of amendments we will come to some of those human rights, privacy and confidentiality issues.

The hon. Member for Inverclyde (Mr McKenzie) said that data would be revealed in some way, but the confidentiality of members’ details will still be subject to data protection rules, the Human Rights Act and the obligations of confidentiality in clause 37.

The hon. Member for Hayes and Harlington (John McDonnell) said that the provisions would displace core union activity, but we should recognise that the changes are modest. Unions are already required to keep the register of names and addresses and of course we will work with unions and others to ensure that there is a smooth transition to the new system, supported by appropriate guidance.

Analogies with other membership organisations were raised by various Members. As I outlined to the hon. Member for North Ayrshire and Arran, charities are regulated by the Charity Commission, which has widespread powers that focus on financial management because of the importance of donors and beneficiaries. The commission can carry out regular supervision and monitoring, including compliance visits. If a charity is under investigation, the commission can freeze assets and suspend or remove trustees. In the case of companies, the Companies Act provides the regulatory powers. The information has to include names and addresses and dates of membership, and fines and penalties are in place for non-compliance with these duties. The IOD and the CBI are lobbying organisations incorporated by royal charter, which means that the Privy Council is responsible for significant aspects of their internal control. I doubt that unions would think that those regulatory frameworks were appropriate to their unique status. Trade unions have a unique set of powers. They have rights and obligations—for example, the ability to take industrial action without financial liability for the consequences on those it affects. That is a special set of rights and it is therefore appropriate that they have a tailored set of regulations.

The hon. Member for Leyton and Wanstead (John Cryer) said that it is hard to keep accurate records of a work force, particularly in sectors where they are very fluid, such as construction, where there is significant churn. I absolutely appreciate those points and agree with him. That is why it is important that good procedures are in place to provide assurance that the lists are up to date. That is qualified by the phrase,

“as far as reasonably practicable.”

We will take into account the difficulties that are encountered.

The hon. Member for Aberdeen North made a thoughtful contribution in which he made good points about previous problems with great swings in policy direction from one Government to the next and the importance of trying to get agreement between the TUC and the CBI. There can often be common ground, as we find through the agreements on, say, the agency worker regulations or the way in which such organisations are able to work together through institutions such as the Low Pay Commission. He thinks that we are demonising trade unions, but I respectfully disagree. Many companies have very good relations with trade unions which play an important and welcome role. He over-eggs the impact that this measure will have.

I have dealt with the consultation issue raised by the hon. Member for Wansbeck. The hon. Member for Blaydon (Mr Anderson) made a number of points that mainly echoed others that had already been made and that I think I have dealt with. I appreciate that I may not have satisfied every member of the Committee. None the less, I have set out why clause 36 should stand part of the Bill and the amendments should be rejected.

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[Jo Swinson]

I will come on to the issues relating to the assurer. I would like to deal with data protection sensitivity and turn to the issue of blacklisting before I come back to the specifics about the assurer, if the hon. Gentleman will bear with me.

The hon. Member for Edinburgh South was asked by the hon. Member for Birmingham, Selly Oak (Steve McCabe) about penalties if there is a breach of data protection or confidentiality issues. Various protections are in place. The assurer would have to comply with the Data Protection Act. If they did not do so, they would be in breach of their contracts, so as well as being removed, the union could sue them. However, the assurer would also be a data controller, so the Information Commissioner could take action. The Information Commissioner has significant powers under the Data Protection Act, which include serving an enforcement notice setting out action that the data controller must take and—where required to address a serious contravention of the duty—imposing a fine of up to £500,000. Failing to comply with an enforcement notice by the Information Commissioner is also an offence, so there are significant protections in place.

The hon. Member for Hayes and Harlington (John McDonnell) and others raised the important issue of blacklisting. Let me reiterate on the record—my right hon. Friend the Secretary of State and I have said this on various occasions in the House—that the blacklisting of trade union members is unacceptable and illegal. Following an investigation, of which the Committee will be aware, that uncovered the Consulting Association’s blacklist, the law was strengthened at the end of the previous Parliament by the Employment Relations Act 1999 (Blacklists) Regulations 2010. That was also when the maximum fine for a breach of data protection rules was increased to £500,000.

The Committee will also be aware that the Select Committee on Scottish Affairs has been conducting an inquiry into this issue. In July, the Committee contacted the Secretary of State to say that it had new information that blacklisting continues. We have always encouraged anyone with evidence of blacklisting to come forward so that we can investigate. The Scottish Affairs Committee is the first to get in touch formally to say that it possesses new information. We are grateful to the Committee for passing that information to the Department. We have referred it to the Information Commissioner’s Office, as the appropriate body to investigate any breaches of the Data Protection Act. I understand that the office is requesting more information from the Committee, so that it can examine it and investigate. My right hon. Friend and I will of course continue to take a close interest in this matter. If any evidence of blacklisting is found, the perpetrators must feel the full force of the law.

Let me turn to the amendments in this group. Amendment 107 would make the assurer owe a duty of confidentiality to the union and its members—this deals with the concerns raised about data protection. I hope that the protections I have outlined will reassure hon. Members about compliance with the existing legislation, even though it is not explicitly mentioned in part 3—the convention is to keep legislation concise and not to repeat existing legal requirements. I am happy to reassure the Committee and put it firmly on the record that compliance with the Data Protection Act will be necessary for anyone who handles sensitive data.

Amendment 108 would require the Secretary of State to set out eligibility criteria for the assurer—this goes to the point about the future career ambitions of the hon. Member for Wansbeck—along with what qualifications, status and experience assurers must have. Our approach will be the same as for independent scrutineers of trade union ballots and elections. It is important that the assurer has widespread credibility with unions, their members and the public. The order will say which organisations are eligible or list the criteria that must be met. We imagine that assurers will probably be recognised professionals, such as solicitors, auditors or independent scrutineers. The responses to our targeted consultation over the summer supported that approach. I am not sure whether the hon. Gentleman falls into any of those categories, but he might be interested to know that we will need to consult on the content of the order, and I give the Committee an assurance that we will do so. There will therefore be an opportunity—this is important—for unions, their members and the public, as well as the hon. Gentleman, to comment.

[Katy Clark]

The hon. Lady was asked in an earlier intervention how she would deal with potential conflicts of interest. Will she deal with that now?

[Jo Swinson]

I gave some examples of where there might be a conflict of interest, such as where somebody was already an officer of the union, which would not be appropriate, as they would need to be independent. However, as I have set out, there will be a process in the order for outlining eligibility.