Employment Rights Bill

Lord Leigh of Hurley Excerpts

Consideration of Commons amendments and / or reasons
Monday 17th November 2025 Lords Chamber

[Lord Fox (LD)]

I thank the Deputy Speaker for his expert guidance. Your Lordships could be excused for a sense of déjà vu, perhaps because we are back in your Lordships’ House with the same issues we discussed on 28 October. They remain unresolved and, indeed, not addressed in any meaningful way.

Since the last very similar session of ping-pong, I have had an engaging meeting with the Lords Ministers and their officials, and I thank them for that meeting. The prospect of that meeting gave me a sense of anticipation. I expected some sort of legislative rabbit to be pulled out of the Government’s hat at that point, but no—there was nothing. At first, I thought something substantive was being concealed for tactical reasons, perhaps ready to be flourished in some dramatic prestige at the moment that pleased the Ministers. But it has become increasingly clear that not only is there no rabbit in the care of the Benches opposite but there is actually no hat. If there is a hat, it exists elsewhere, and for that I have some sympathy for the Ministers opposite, because they sit bare-headed at the moment, with nothing to offer.

Time has passed, however, and, if the Government’s position has not changed, what has? Well, the business environment has got worse. September saw negative growth in GDP, per capita productivity fell in the last quarter and unemployment rose to 5% as recruitment cooled. Yet this ping-pong represents a doubling down—but for what? The Government’s manifesto vowed to “make work pay”, and we agree with that. None of these amendments confound this. My Motion A1 does not in any way dent the worker’s right to convert zero hours to guaranteed hours. What it does is streamline the administration of that right. I explained last time that Motion A1 merely avoids unnecessary work, helping SMEs that have limited administrative capacity to get on with focusing on growing their business and, hopefully, creating more jobs. But, in the absence of an amendment in lieu today, I will insist on this.

Moving on to the amendment of the noble Lord, Lord Sharpe—Motion C1—we have consistently raised concerns about seasonal work. I welcome the Minister’s careful description of the issues in the current legislation—the problem being, of course, that there is outstanding consultation and outstanding details that make it difficult. We are not 100% happy with the noble Lord’s drafting, but we feel that it is a starting point for further conversations of the nature the Minister just brought up. We will support Motion C1 if it is voted on. Sorting the impasse on these Motions and those in subsequent groups requires political gumption. In the end, I suppose it will be up to No. 10—I understand that it might be preoccupied with other issues at the moment.

I close with one last statistic, this time from the Work Foundation at Lancaster University. There are now 1.79 million people out of work and looking for a job. With economic inactivity stable at a staggering 21%, the number out of work appears to be rising not due to increasing inflow but rather due to limited outflow caused by difficulties in finding work. That is 1.79 million people. The Government did not address the arguments we put two weeks ago, and therefore they deserve the same response as last time. I beg to move Motion A1.

[Lord Leigh of Hurley (Con)]

My Lords, as the noble Lord, Lord Fox, said, here we are, back again.

In the ping-pong debate last time, the noble Baroness, Lady Lloyd of Effra, stated:

“The Government have engaged extensively with stakeholders on their make work pay reform since August 2024. A major part of this engagement has been to seek the varied views of SMEs. As of 15 October, we had engaged directly with more than 250 stakeholders. This included 139 businesses, of which 75 were SMEs. This approach to engagement will remain throughout the various consultations”.—[Official Report, 28/10/25; col. 1246.]

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[Baroness Lloyd of Effra (Lab)]

My Lords, I thank noble Lords who have contributed to the debate today. Let me start by recapping the reason for this measure.

There is a moral case to press ahead with ending exploitative zero-hour contracts. We aim to rebalance the scales so that all the risk associated with insecure work is not placed on workers. By our doing so, work will become more secure and predictable, saving workers in some of the most deprived areas up to £600 in lost income, strengthening the foundations that underpin a modern economy and increasing productivity, rather than the obverse.

On business engagement, we have indeed engaged with businesses and consulted them, both directly and through federations that represent a large number— hundreds and thousands—of small businesses. We will continue to do so as we implement all the measures in the Bill. We are committed to full and comprehensive consultation with businesses big and small and will arrange focus sessions with SMEs specifically to look at the practical implementation, understand any challenges and make sure that we give the right guidance.

I want to reflect on the point about business regulation and the 25% target. We have established a baseline for the administrative burden; the 25% target is about ensuring that regulation is proportionate and efficient and works for business. It is not about blocking regulation that is needed to deliver the Government’s priorities. We want to implement the Bill in a way that delivers the intent as efficiently as possible. For example, the fair work agency will consolidate the functions of the Gangmasters and Labour Abuse Authority, the Employment Agency Standards Inspectorate and the Director of Labour Market Enforcement into a single body, so we are reforming as we go ahead with all these measures, and we believe that, fundamentally, this is about balance.

The noble Lord, Lord Hunt, raised the issue of seasonality. Let me reassure noble Lords that the Government are fully conscious of the need to take account of fluctuations in seasonal demand, while ensuring that workers are not left holding all the risk. Under the Bill, there are several ways that an employer could approach seasonal demand while upholding the new rights, depending on circumstances. I set out some of those in my opening speech, but they could be limited-term contracts or guaranteed hours in various ways, such as an annualised hours contract. We think it is important to continue to consult on seasonality.

On growth, we have seen huge progress in foreign direct investment and trade agreements. We are very keen to continue to promote the economic prospects of the country, which is fundamental to improving the productivity of the labour market. In conclusion, I thank noble Lords for their contributions today and I look forward to further discussions on these issues.

[Lord Leigh of Hurley (Con)]

Before the Minister sits down, she said that she had consulted representative bodies of industry and commerce, by which I assume she means the FSB, the IoD and the CBI. Can she give us a flavour of those conversations, and identify any organisation that has given wholehearted support to the Bill?

[Baroness Lloyd of Effra (Lab)]

Of course, we have had many discussions and there have been amendments during the passage of the Bill as a result of some of the consultation we have had with all social partners. We made amendments to the Bill on Report in respect of fire and rehire and the school support staff negotiating body—all sorts of changes or amendments have been made through the consultation process. We have also set out a clear plan for implementation, so that each milestone is there and there is a consultation before that, so that all businesses, large and small, can have the right amount of time to prepare and to get the guidance they need to implement these measures.