Lawful Industrial Action (Minor Errors) Bill

Debate between Ed Davey and John McDonnell

Friday 22nd October 2010 Commons Chamber

[The Parliamentary Under-Secretary of State for Business, Innovation and Skills (Mr Edward Davey)]

I congratulate the hon. Member for Hayes and Harlington (John McDonnell) on coming first in the ballot for private Members’ Bills. The Bill gives us a chance to debate an important and topical subject—industrial action law. That issue is receiving wide attention in the media. As hon. Members know, some organisations, including the CBI and the Policy Exchange think-tank, are calling for that body of law to be strengthened, and we heard those voices loud and clear in the debate today. Of course, that is the exact opposite of the effect that the hon. Gentleman wants to achieve through the Bill.

It is not the first time in recent years that the hon. Gentleman has presented a private Member’s Bill. A couple of years ago, he tabled the Trade Union Rights and Freedoms Bill, which also centred on industrial action law. I commend him for his determination and consistency of purpose. He has a justified reputation in the House as a doughty defender of trade unions. His knowledgeable and often impassioned contributions to our debates show his deep commitment to that cause. That commitment does him credit, even though many in the House, including some of his hon. Friends, do not always share his views.

If my memory is correct, the last Bill the hon. Gentleman introduced included proposals for root-and-branch reform of strike law. For instance, it contained provisions to restore the lawfulness of secondary industrial action and to repeal the requirement on trade unions to provide notice to employers in advance of industrial action. He presents his current Bill as a modest measure in comparison—it is undoubtedly more modest than his previous Bill, which I suspect was rather closer to his heart and true beliefs than this one—yet modesty is often in the eye of the beholder. Saying that this Bill is more modest than his last does not make it so, despite its seductive title.

The Bill is admirably short—just two clauses. It works by changing section 232B of the Trade Union and Labour Relations (Consolidation) Act 1992. However, as I shall demonstrate in my speech, the Bill is not so modest as it appears at first sight. In fact, it would have the effect of altering the applications of about 15 other sections of the 1992 Act. In some cases, it would significantly relax the procedures that trade unions must follow when organising industrial action—something which the previous Government considered and rejected.

In the hon. Gentleman’s opening remarks, he made one or two points that the House ought to consider more carefully. He argued that his Bill tries to achieve the original intention of section 232B by applying it to all 15 sections of the 1992 Act, but that is wrong. Section 232B is clearly drafted so that it applies to just four sections of the 1992 Act. Parliament did not therefore intend that it should apply as widely as he suggests, and it is important that hon. Members hear that argument.

The hon. Gentleman referred to a number of court cases, but it is worth reminding the House that in recent times, the trade unions have been the ones scoring wins in the courts—many of my hon. Friends referred to such cases. For example, the Court of Appeal ruling in BA plc v. Unite this year, to which my hon. Friend the Member for Dover (Charlie Elphicke) referred in some detail, found very strongly for Unite and rejected the employer’s argument. In Milford Haven Port Authority v. Unite, the Court of Appeal again found for the trade union. In a third case this year—Metrobus v. Unite—although the Court gave an injunction against the trade union, it dismissed many of the employer’s arguments with respect to notices, saying that the errors were small and should therefore not be considered.

The case law that has amassed this very year suggests that the concerns of the hon. Member for Hayes and Harlington are not based on what is true. I strongly urge Labour Members to think carefully about the fact that real case law developments are helping trade unions. The hon. Gentleman tried to argue that the Bill would reduce uncertainty and therefore that it would give greater clarity and assist the process. As many of my hon. Friends clearly demonstrated—particularly my hon. Friend the Member for Shipley (Philip Davies)—changing the “accidental” test in the current law and replacing it with a “substantial compliance” test would create uncertainty, because case law has clarified the law, which is in the unions’ interests. Therefore, some of the core arguments behind the Bill are flawed.

I congratulate my hon. Friend the Member for Bury North (Mr Nuttall) on his speech. Using his legal background, he forensically showed that the test of substantial compliance had extreme shortcomings, and said that it would result in some bizarre outcomes if applied more generally in law.

I welcome the hon. Member for Llanelli (Nia Griffith) to her new position as Opposition spokesperson and look forward to our debates, not only on this Bill but on the Postal Services Bill, on which no doubt we will spend some weeks in Committee. She rightly praised the actions of many unions, especially how, during the recession, they have engaged and worked with management in many firms—large and small—up and down the country to preserve and create jobs. I, too, would like to put on the record my praise for those unions and employers who have been prepared to work flexibly—in respect of family-friendly flexibility, pay cuts and reduced work hours—with management to prevent redundancies.

That sort of progressive trade unionism needs to be highlighted and pinpointed. I often think that it removes some of the passion from this debate by showing that many trade unions are committed to ensuring that our economy is vibrant and prosperous, and do not want to undermine firms’ ability to move on. I was pleased that the hon. Lady committed the Opposition Front-Bench team at least to the framework of industrial relations law, as Labour did time and time again when in government. I was also pleased that she made it clear that her Front-Bench team will not be supporting the Bill today. She made one argument against it: she clearly opposes the part of the Bill that reverses the onus of responsibility and puts it on employers. That is one argument against it, but, as I will seek to show in due course, there are others on which the House should reflect carefully.

On the wider industrial relations context in which we should view the Bill, I want to comment on an intervention made by the hon. Member for North East Somerset (Jacob Rees-Mogg) that went to the heart of the matters before us. He reminded the House that trade unions have immunity from prosecution for breach of contract going back to the Trade Disputes Act 1906, which was brought in by a Liberal Government. That immunity is an important special privilege for trade unions, so it is right that Parliament imposes conditions on how they are used. Over the years, all three main parties have supported the role of Parliament in ensuring that there are conditions on the uses of those privileges.

When one looks at the rationale for the Bill, one must bear in mind the industrial relations context in which it is set. It is important to establish that up front, because there are significant differences in our respective understandings of how industrial relations in the UK are evolving. It is because we start from such different points that I fear our attitudes towards the merits of the Bill will not fully coincide. I suspect that the hon. Member for Hayes and Harlington and his supporters view industrial relations in rather more divided terms than I do. Sometimes from listening to him—I have done so for many years—his seems to be a world in which bosses are always seeking to gain an advantage over the work force. In other words, without the countervailing power of the trade unions, individual workers are always chronically disadvantaged in the work place. His Bill therefore seeks to reinforce and strengthen the countervailing power of trade unions and tilt the balance of the current law and our industrial relations practices in favour of trade unions.

Conflict and confrontation are, of course, a feature of workplace life in some workplaces, but it is much less common than it once was. One only has to think back to the 1970s, when on average 12.9 million days were lost each year through strikes. I am delighted to say that modern-day industrial relations are very different. Of course, the 1970s were also a time of high unionisation in both the public and private sectors, but total union membership has declined significantly since then. In fact, it has almost halved. As a supporter of progressive trade unionism, I take no pleasure in pointing that out. However, those trends are particularly apparent in the private sector. Just 15% of private sector employees are now union members and there are large areas of the private sector where unions are completely absent. They are simply not a part of the landscape.

As I have said, I and the Government more generally are supporters of progressive trade unionism. We feel that unions have much to offer this country. Even now, trade unions represent the largest voluntary organisations in this country—one could perhaps say that they are an expression of the big society.

That is why this Government and my Department want to engage with trade unions. We want to hear their considered views, and to develop a common understanding and an approach to the severe problems that this country faces, which include not just our economy, but the critical state of the public finances. That is why my right hon. Friend the Secretary of State meets the TUC’s general secretary, Brendan Barber, each month. I and other BIS Ministers have also had meetings with the TUC and other trade unions. From those discussions we have explored issues of particular concern to trade unions. For example, decisions that I have taken on the national minimum wage, working with the Low Pay Commission, speak to those concerns. We and other Departments operate an open-door policy for trade unions, and in most cases we have retained the joint bodies, such as the public services forum, and partnership arrangements that the previous Government established.

We want to hold a constructive dialogue with trade unions, but of course it takes two to talk. That places an onus on us to listen and to understand the union position on the matters before us and others, but just as importantly, it places a duty on trade unions to engage realistically with the issues that the country and the Government face. Most trade unions are committed to a mature and positive dialogue of this kind. Sadly, there are a few exceptions to that, but I should pay credit to the many unions that do engage. The Government also understand that trade unions have a positive role to play in the workplace when they engage with the employer. I want to pay tribute to the role of union learning representatives, who help tens of thousands of their fellow workers with their learning and development needs. The Government have therefore committed themselves to continuing to provide support to their work through unionlearn, the training arm of the TUC.

That said, it remains the case that the protective umbrella that the trade unions once provided for this country’s work force has disappeared across large swathes of the economy. However, employees in the private sector are not subject to widespread exploitation, nor are they generally dissatisfied with their employment. Indeed, most surveys show that union members tend to be more dissatisfied with their working environment than their non-union counterparts. There are many reasons why surveys show that and why the decline of trade unionism has not led to widespread dissatisfaction or the spread of bad working practices. One reason is that the law provides many more rights to workers—many were introduced by those on the Labour Benches—than it once did. These days, it is the law, rather than the presence of active trade unions necessarily, that provides the guarantee of decent working conditions and fair treatment to millions of men and women up and down our country.

Another key reason, which I want to stress, is that working life and the approach of employers have moved forward. I am glad to say that it has become the consensus among a vast majority of employers that they should develop a new style of employment relations based on engaging and involving employees. Employers are not taking that approach simply because it is fair and progressive in itself, though it is; they have other, hard-headed commercial reasons for adopting such enlightened policies. Employers realise that obtaining the active co-operation of the work force is vital if they want to increase productivity and raise competitiveness in today’s tough market conditions. The quality and creativity of workplace performance are increasingly important for business success. More and more employers are developing innovative ways to engage their employees.

I do not know whether Labour will take this position in opposition, but the previous Labour Government certainly grasped that point. Indeed, they were enthusiastic enough to promote the message of employee engagement, which in many ways is the zeitgeist of employment relations, and they commissioned a special and very informative study into the subject, by David MacLeod and Nita Clarke, a former adviser to Mr Blair when he was Prime Minister. I have met them both, and I have encouraged them in that work and given support to it from the Department. This forward-looking agenda for employment relations is about securing greater co-operation and engagement in the workplace. It is about identifying common interests between employers and employees, and achieving the shared business goals. It is also about encouraging more employee participation and new forms of ownership. That is not a zero sum game, and this is certainly not about reliving the battles of the 1970s or 1980s.

Looking at the context of the industrial relations behind the debate today, I fear that the Bill does not engage with the new agenda. In many ways, it seems to be a throwback to a previous age, and both the hon. Member for Hayes and Harlington and we need to draw a line under our industrial relations history and turn the page. His Bill does not do those things. So, at a very basic level, I have serious reservations about his proposal.

The Advisory, Conciliation and Arbitration Service is promoting the new style of industrial relations, and I believe that it has much to offer to our debates in this area. I recently visited the ACAS head office and spent some valuable time with its chairman, Ed Sweeney, and his colleagues. I was deeply impressed with the expertise available to ACAS, and with the commitment of its work force. It is best known for its work on conciliating the settlement of industrial disputes, and its record on that is impressive. Less well known is its work on advising employers and trade unions on good employment practices and the management of change. That work helps to raise productivity and performance, and nips potential workplace problems in the bud. Importantly, it creates a culture of collaboration and mutual support at work. I believe that this approach to industrial relations improves—

[John McDonnell]

On a point of order, Mr Deputy Speaker. I thank the Minister for giving us the opportunity to hear the Government’s response to the Bill, which we have now done. There is other important Back-Bench business today, and I would like formally to move that the Question be now put.