Employment Rights Bill

Lord Monks Excerpts

2nd reading
Thursday 27th March 2025 Lords Chamber

[Lord Monks (Lab)]

My Lords, I add my congratulations to the quartet of maiden speakers. I think they have all laid down a mark and people will look forward to their future contributions in this House.

I want to pitch my remarks at some of the messages coming from across the Chamber, almost asking “Why have we got this Bill in the first place when our wonderful flexible labour market is doing so well?” For me, a key justification of the Bill is deep concern about the UK’s relative position in the world. I will give a couple of OECD figures. Of 40 major economies, we are the most affected by rising inequality. In Europe, only Bulgaria and Lithuania fare worse. The gap between top and bottom earners in this country continues to soar to some eye-watering amounts, which are not always linked to corporate success. When it comes to worker participation in management decision-making, the OECD ranks us 26 out of 28 European countries. We are propped up only by Latvia and Estonia doing worse. We are not in the Premier League on these particular measures: more like the Vanarama.

If we had been outstanding economically, as the advocates of deregulated labour markets in the 1980s hoped, and if our productivity and investment record had been better, maybe you could justify high unemployment, high inequality and poor participation in management; perhaps it would have been a price worth paying. But the result has been that we are currently 20% poorer on average than workers in France or Germany, which have very different labour markets and a much greater degree of regulation.

I could go on making these depressing and unfavourable comparisons. If some people thought trade unions were overmighty subjects in the 1970s and 1980s—many people did and still do—and that unions could do with a good regular dollop of restrictive legislation loaded on them, I hope that today they will honestly acknowledge that British workers have payday very heavy price for what has happened since: the flexible labour market and its dark sides. I acknowledge that there are some upsides for some people in certain circumstances, but there are many dark sides for others who have very little choice: lower pay, lower protection, lower skills and poor productivity. This is not a happy picture for our nation and it is one the Government are determined to do something about. Mrs Thatcher did not expect the flexible labour market to produce some of these awkward facts, but they have to be faced by her successors.

The Bill strengthens the workers’ voice in the workplace, and I hope that that will echo, too, in boardrooms across the country. It needs to, if firms are to prosper as effective communities and teams. The Bill should boost job security, and it should reduce bad behaviour in a number of areas and tackle a number of abuses in the workplace at the present time. I encourage the noble Lord, Lord Hunt—who we are happy to renew dialogue with after many years—to have another look at the biography of Stanley Baldwin to see what he did after the general strike to promote collective bargaining.

The Bill will put unions in a stronger position. I do not apologise for that: the balance tilts with this Bill if it goes through in its present form. It can help tackle inequality and improve, through that, productivity. We need the Bill, and we need it soon.

Employment Rights Bill

Lord Monks Excerpts

Committee stage
Tuesday 29th April 2025 Lords Chamber

[Lord Hunt of Wirral (Con)]

My Lords, briefly, I thank the noble Lord, Lord Fox, for bringing forward this important purpose clause amendment, which I must tell him—I know he is always surprised when I praise him—is a very cleverly worded amendment to which my noble friend Lord Sharpe of Epsom and I were very happy to add our support.

I do not know why this Bill has had to be rushed through within 100 days. Given the significance of this legislation, surely it would have been better if the Government had committed themselves to ensuring thorough and proper scrutiny. However, we have seen the introduction of 160 amendments on Report in the House of Commons—amendments which, in many cases, received no or little meaningful examination.

Even more concerning is the fact that the Government have tabled 27 amendments for Committee in this House. We have received a letter from the Minister warning us that there are more amendments in the pipeline on fire and rehire, the fair work agency, employment Bill time limits, trade union reform and maritime employment. What on earth is going on? Why was not this Bill properly prepared? This has meant that the letter to which the noble Lord, Lord Fox, referred is virtually saying to the House of Lords, “Please, on behalf of all the employers—and, indeed, all the businesses in the UK—we rely on you in the House of Lords to scrutinise this Bill properly”. I just do not think that this is the right way to treat Parliament. We owe it to the legislative process and to the public we serve to ensure that our scrutiny is neither rushed nor compromised.

No doubt the Minister will argue that a purpose clause is completely unnecessary. However, we respectfully disagree, and not only for the reasons raised by the noble Lord, Lord Fox. It is vital for the Bill clearly to articulate its overarching aims: not simply to modernise employment rights in name but to set out a clear ambition to create a fairer, more secure labour market; to encourage genuine co-operation between employers and workers; to protect rights and well-being in the workplace; to ensure proper standards for pay and conditions across sectors; and to guarantee robust enforcement of labour protections. I have to say that, without a purpose clause, this Bill risks being directionless and, worse, risks unintended consequences that neither workers nor businesses can possibly afford.

I think also—and I hope the noble Lord, Lord Fox, will agree—that a purpose clause is particularly important where there are a large number of delegated powers to make regulations within it. In effect, the Government are saying, “Please give us the power to do whatever we would like to do whenever we would like to do it”. The committees of this House have, time and again, urged Governments to turn their back on these Henry VIII clauses and present Parliament with clear cases to amend primary law, not do it through secondary legislation.

Well, there is growing concern about this Bill, which is why the British Chambers of Commerce, the Confederation of British Industry, Make UK, the Institute of Directors and, in particular, the Federation of Small Businesses, which between them represent thousands of businesses across the country, have published this open letter to the House of Lords, asking for urgent changes to the Bill. They did so because they are deeply concerned that, as drafted, the Bill will make it harder, not easier to create fair, secure and co-operative workplaces. They warn that the Bill will increase risk and uncertainty for businesses precisely at the moment when we need businesses to invest, to hire and support in particular those who are at the margins of the labour market.

I do not think that the substantive concerns of all the businesses quoted by the noble Lord, Lord Fox, have been listened to. I just hope that the Minister can respond when she winds up this debate. I look forward to the speeches from all sides of the House. I will not quote in detail from the letter, but it does remind me of the words of Milton Friedman. If I am ever to find myself quoting Milton Friedman, I suppose that this is the moment. He said:

“One of the great mistakes is to judge policies and programmes by their intentions rather than their results”.


Well, fine phrases about modernising employment rights and updating legislation are no substitute for carefully considered, properly scrutinised measures that deliver real-world improvement. So that letter from all those businesses is not a warning but a plea to this House. It is a recognition that we as the revising Chamber have a unique and critical responsibility to ensure that this Bill works. They are not closing the door on the Government but offering, at the end of the letter, to work with us all and with Ministers to help improve legislation.

In conclusion, if we are to get all these amendments, can we hear from the Minister how many more amendments we are going to get and when? The Government Chief Whip is constantly referring us to the Companion. I have never quoted from the Companion before, but it has pretty severe words for a Government who choose to table amendments at the last moment, without proper notice. So could we hear from the Minister what further amendments are planned, when we will receive them, and which parts of the Bill will be fundamentally altered? Here we are, at the start of Committee, still not knowing what the Government are proposing.

In an unguarded moment, the Minister disclosed to me that she has an implementation plan, which I understood from her was in draft. This House ought to see the draft implementation plan. Why can we not see it? Perhaps we could help the Minister produce the final draft. We should not get an implementation plan half way through Committee. Could we hear from the Minister on when we will see the implementation plan? A lot of businesses up and down the length and breadth of this country are totally uncertain about what the detail of this Bill will be. It is about time that we heard from the Minister about what the Bill seeks to do, what its purpose is and whether we can see it in its full form before we go any further with Committee.

[Lord Monks (Lab)]

My Lords, I will speak to Amendment 1 and avoid the temptation to engage in a mini-debate across the whole width. So far, I feel I have been sitting in a Second Reading debate. I have given speeches in this House before, reflecting similar sentiments to those in this amendment about fairness and co-operation. These are the words used in the amendment from the noble Lord, Lord Fox. I gave them in the context of the debates on Conservative anti-union laws, which we have addressed in this House in my time. Sadly, no one on the Conservative Benches, except for the noble Lord, Lord Balfe, who is in his place, paid any heed. The laws then proceeded to the statute book and the result was an imbalance in British employment law very much in favour of employers.

The Bill goes some way towards correcting that. Once it has been implemented, I hope we can look again at a system of mature collective bargaining of which we all can be proud. But first, we must replace the imbalance, and do so speedily, because it is glaring. Change is desperately needed; our labour market is characterised by high inequality—only two OECD countries have a bigger gap between rich and poor and between top earners and the very low-paid.

Employment Rights Bill

Lord Monks Excerpts

Committee stage
Wednesday 21st May 2025 Lords Chamber

[Lord Monks (Lab)]

My Lords, it is commonplace for individuals who express personal views that clash with the ethos of a particular company or institution to run into some trouble. Gary Lineker is the latest and most topical example, for displaying material that is considered to be antisemitic. My first experience, age 12, was my father refusing to let me display a political poster at a general election. If I had known about the Free Speech Union, maybe I would have joined the noble Lord, Lord Young, at that stage—maybe he should send Gary Lineker a membership form.

[Lord Young of Acton (Con)]

I have.

[Lord Monks (Lab)]

Oh, he has already done it—very good.

Let us be real about this. A lot of situations call for tact and diplomacy, and for us to be careful about the way we express difficult thing. A lot of people do not do that; they say what they like, thinking it is totally justified, and they get into difficulty. Unions spend a lot of time helping people get round those kinds of situations when they have got into trouble with their employer.

I do not think the argument coming from the other side of the Chamber is a convincing one. Let us remember a bit of common sense, and that tact and diplomacy are still required in many organisations, not just the BBC—and not just with my old dad, who did not like the fact that I had a “Vote Labour” poster in the window.

[Baroness Verma (Con)]

My Lords, I did not want to intervene on this group, but, listening to the noble Lord, I became slightly worried that we are getting into censorship. This country is a proud country because of its ability to speak out and speak up. I would be incredibly nervous if we felt that we could not demonstrate our political views openly without being penalised for it. The unions do their own work, but it is incredibly important that people are able to demonstrate a political affiliation or a particular viewpoint without having to feel that they are going to be censored. That would really worry people like me, who often are the recipient of things that we do not like to hear, but we tolerate it because we think the country enables us to have the debate.

--- Later in debate ---

[Lord Monks (Lab)]

My Lords, I do not doubt that critics of this part of the Bill speak with a lot of personal experience as well as commitment to their employees and the way they run their affairs. However, let me remind people that the argument that is really coming from the other side—that the qualifying period would be damaging to employment—is the argument as has been used against just about every bit of progressive employment legislation from the Factory Acts onwards. If noble Lords think that that is hyperbole, they should remember the national minimum wage and the campaign that was run against it. None of that came to anything like what was forecast from that side of the House. I have risen briefly to ask the other side of the House to remember that it was wrong on the minimum wage and to consider whether it might be wrong on this as well.

[Lord Hendy (Lab)]

My Lords, I get the impression that there is a bit of a misunderstanding around the nature of employment tribunals. I spent the first half of a long career at the Bar doing employment tribunal cases, many of them unfair dismissal cases. In fact, the first case I ever did—pro bono, by the way—was an unfair dismissal case in 1972, under what was then the very new unfair dismissal legislation. Unfair dismissal cases are difficult for employees to win. Most cases that go to a full hearing result in the employer being vindicated.

I want to make two points. The first is that employment tribunals now have robust procedures for weeding out vexatious cases; such cases never go to a full hearing. Secondly, I remind your Lordships of the law on unfair dismissal in Section 98 of the Employment Rights Act 1996. The test is in two parts. First, the employer must demonstrate that the reason for the dismissal is capability, qualifications, conduct or redundancy or the fact that the employment is in breach of some enactment. Once the employer has shown that that is the reason, the test for the tribunal—I shall read it out—is whether the dismissal is fair, which,

“depends on whether in the circumstances (including the size and administrative resources of the employer’s undertaking) the employer acted reasonably or unreasonably in treating it as a sufficient reason for dismissing the employee”.

So all the factors that one would expect to have to be taken into consideration are taken into consideration.

The tribunal then has to determine that,

“in accordance with equity and the substantial merits of the case”.

The Court of Appeal has added yet another burden. When the tribunal decides whether the employer acted reasonably or unreasonably, it is not about what it considers was reasonable or unreasonable; it is about whether it considers that the dismissal fell within the band of responses of reasonable employers. It is at two stages removed. It is not like an ordinary negligence case where the court decides whether an employer was reasonable or not reasonable in putting a guard on the machine. It must decide. Even if it thinks that the decision was unreasonable, if it finds that, nevertheless, reasonable employers would say that it might be possible that the reason was fair, that would be legitimate.

--- Later in debate ---

[Lord Barber of Ainsdale (Lab)]

The noble Lord pointed to the daunting process that faces an employer potentially facing an employment tribunal accusation that would damage perhaps their reputation, as well as the daunting issues that also face the employee who is considering going down that course. My noble friend made some emphasis on that point.

The debate has been conducted as if this is a hugely common threat: indeed, as if it is a threat that, potentially, is going to do tremendous damage to our economy. But could I just point to the scale of the issue? In 2023-24, there were just over 5,000 unfair dismissal cases referred from the Tribunals Service to ACAS for the conciliation processes that my noble friend referred to. What is the size of our workforce in the British economy? Is it 25, 26, 27—

[Lord Monks (Lab)]

Thirty-four.

[Lord Barber of Ainsdale (Lab)]

Thirty-four million workers. Five and a half thousand cases. Why is the number so small? It has been suggested that it is because an employer’s immediate response is to offer a settlement to buy off the prospect of a tribunal. Some may make that judgement, but, given the evidence my noble friend has referred to about the unlikelihood of applicants succeeding with their claims, that does not seem a very wise response to give. There may be some, but for the individual, it seems to me, more daunting factors influence them to hold back because it is so painful and potentially stressful that they are reluctant to take their case in the first place.

This whole Bill is about giving people at work in Britain more confidence and there needs to be some sense of perspective about the scale of the issue we are talking about. Five thousand people.

Employment Rights Bill

Lord Monks Excerpts

Committee stage
Tuesday 10th June 2025 Lords Chamber

It is of course open to the Government to create that mechanism and ensure that the money is refunded. That has not been contemplated and put into the Bill.

[Lord Monks (Lab)]

I was around when the noble Lord, Lord Burns, was chairing his committee and I was involved on the fringes of some of the work that was done. From the unions’ side, we appreciated very much what he did and the work the committee did with his colleagues. Getting that kind of arrangement was a get out of jail card for us—a halfway house, if you like, which is still promoted.

We were aware of the history. In 1927, when the Conservative Government introduced opting in instead of opting out, there was a catastrophic fall in the number of people who contributed to the union political fund; that was the truth of it. Unions did not have the administrative superstructure to go around and re-recruit people into that kind of arrangement. That was repealed by the Labour Government at the end of the Second World War, such was the anger about 1927—it was about the first thing they did. Hartley Shawcross, the Attorney-General, unwisely said, “We are the masters now”, which caused a lot of controversy, so this is not a bloodless issue. This is about party funding and the sinews of keeping a great party going under a lot of pressure from all kinds of people.

We were very pleased, and warmly welcomed the work that the noble Lord, Lord Burns, did. We had made an offer that maybe all party-political funding should be looked at. If there was some uneasiness about aspects of Labour’s arrangements, there is certainly some uneasiness about Conservative Party arrangements, which are not noted for their clarity and openness and all the other things the noble Baroness, Lady Coffey, and others have been extolling as virtues, which they are trying to install into the union world. We hear a lot from the Conservative Party about deregulating business all over the place, but—

[Baroness Finn (Con)]

I thank the noble Lord for giving way. I just make the point that all political donations have to be transparently declared. My noble friend sitting next to me can explain more, as treasurer of the Conservative Party, but they are all declared.

[Lord Monks (Lab)]

I look forward to that degree of clarity in Conservative Party funding. We could all be enlightened by the explanation that I believe is about to come. We are talking about an amount of—

[Lord Leigh of Hurley (Con)]

We had an excellent debate 10 years ago. With great respect, the noble Lord, Lord Monks, said that the transparency and clarity of donations to the Conservative Party leave something to be desired. Can he please be specific about this?

[Lord Monks (Lab)]

I will not be specific about it because I do not want to generally insult people, but over the years, there has been some dodgy funding of the Conservative Party. Maybe something has been done about it; maybe it has not. The noble Lord will tell us in a moment, I am sure.

I will say something about the amount of money we are talking about, which the noble Baroness, Lady Cash, touched on. In 2016, when I was much more au fait with this debate than I probably am today, the contribution that the union member made to the Labour Party was not much more than the price of a pint of beer. It has gone up a little bit if it is 10 quid now, but it was a modest amount. Comparisons with financial services, as the noble Lord, Lord Jackson, has made, are wrong, because the sums of money we are talking about there are much greater, and refunds, and all the rest of it. The kind of administrative fee that would be required for that amount of donation seems ridiculous.

On this side, we very much see this as an attempt to restore some Labour Party funding streams. I do, anyway—I will not speak for the Front Bench. I think it is important that the Labour Party gets the funding that it requires. I believe that going back to 1945, 1946 and so on is the right way to go, so I support the Government and the Bill.

[Lord Johnson of Lainston (Con)]

My Lords, I apologise for not having spoken at Second Reading, although I have been watching this debate with great interest. As chairman of the Conservative Party, I am delighted that today we announced record donations into the Conservative Party. None of those donations was forced; none of them was given to us because we compelled people to give them to us; and they were not given to us because of an administrative system that prevented people taking their money out or opting out. It was because people voluntarily wanted to support the cause that we stand for.

On the same day that we announced record inflows, thanks in many instances to my noble friend Lord Leigh, the Labour Party also saw significant donations, not substantially to the level of the Conservatives’. I think half of the donations came from unions, but some came from a number of individuals, including in this House from the noble Lord, Lord Alli—who I cannot see in his place—who continues to support the Labour Party and is a good lesson for all Peers to support the parties which fostered them.

The point is that in our democracy, we live in an extraordinary country where voluntary contributions make up how parties are funded. At the essence, if you distort that, you have enormous problems with how the public perceive politics and the responsiveness that political parties need to show to the public who support them in the first place.

I am a great proponent of the union movement. I think it is an essential element of capitalism—it ensures that there is balance between labour and capital—but if you distort that, you distort the economy, nearly always to the negligence of the people who are members of those unions.

The reason I have not spoken before is that it had not actually occurred to me the sort of damage that this Government are trying to do to this country. I could not believe that it was going to be the case that people will be compelled, in effect, to join the Labour Party or to contribute to it—I had to sit in these debates and read back transcripts. We just heard from the noble Lord, Lord Monks, who said exactly this: this is absolutely about redressing the balance in terms of party funding and to fund the Labour Party.

By the way, I respect that openness. The unions paid for the Labour victory and now they want to have their message delivered; they want the legislation moulded in their way. That is brutal politics of a kind that, frankly, I am just a bit squeamish about—but I rather admire.

I ask the Minister: is it really true that she is expecting people to be compelled to donate to a political fund, and that there is no mechanism for some form of compensation or redress if they decide to opt out? In a world where we can subscribe instantly to Apple Music, or whatever it is, at the touch of a button, and we are compelled to ensure that people’s subscriptions are reviewed on a constant basis, certainly annually at the absolute minimum, probably quarterly or maybe even monthly—rightly so—is it true that this mechanism will be reviewed every 10 years? It cannot be true that the Government are proposing 10 years beforepeople can see whether they should review their paperwork for a subscription to a political fund. This is remarkable.

I am actually amazed at the audacity, and I slightly admire it, as I said, but if we want a strong democracy and political parties that actually have trust placed in them by the people of this country, this sort of chicanery and gerrymandering is extremely dangerous. The amendments that have been proposed by Cross-Benchers are exceptionally eminent in the sense of making sure that we have a fair system to ensure that unions can indeed represent themselves politically. They can and should build political funds to advance their aims and some of the aims they have advanced over the last century or so are admirable, and I applaud them. But this must not be a mechanism for compelled donation to the Labour Party. It would be a disaster for our democracy, it would not benefit our unions and it would not help our country in any way at all—that is why I support these amendments today.

Employment Rights Bill

Lord Monks Excerpts

Committee stage
Tuesday 24th June 2025 Lords Chamber

[Lord Monks (Lab)]

I was just sitting here looking at the noble Lord, a member of Mrs Thatcher’s Cabinet, with another one over there, the noble Lord, Lord Deben. When they passed a major piece of legislation, were there were any cases where you went to Mrs Thatcher and said, “Can we have an independent assessment of whether we have done the right thing?” I cannot remember anybody ever doing that, but perhaps the noble Lord can tell me otherwise.

[Lord Hunt of Wirral (Con)]

I have many, many—

Employment Rights Bill

Lord Monks Excerpts

Report stage
Monday 21st July 2025 Lords Chamber

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

My Lords, I will speak to Amendment 127 in the name of my noble friend Lord Hendy, but I am conscious that some of my comments may also be relevant to Amendment 125, which I oppose.

According to the latest LFS figures, 6.4 million people hold a union card, making trade unionism by far the largest democratic membership movement in the UK. Many of Britain’s most innovative companies recognise trade unions and the real value that an independent voice for workers adds, including Rolls-Royce, Uber, Virgin Media and EDF Renewables, to name but a few.

We have heard on several occasions how union membership has declined since the 1980s, and no doubt we can debate the reasons for that. But it is also worth recording that the ONS’s annual survey of hours and earnings, which is a survey of employers, shows that today the pay of more than four in 10 jobs in the UK is set with reference to a union agreement. In other words, collective bargaining still sets the pace for the pay and conditions of a substantial part of the workforce, well beyond union membership—but expanding collective bargaining coverage has never been more urgent.

OECD analysis shows that the UK has one of the highest levels of income inequality in Europe. The picture on wealth inequality is even worse. That is bad for society and a brake on fair growth. It is not just about the families who work all the hours God sends yet still rely on benefits and food banks, or that under the previous Government living standards stagnated for 15 long years, or that the real threat to the survival of pubs, hospitality and small businesses on the high street is the prolonged squeeze on disposable income that has hammered consumer spending. It is more than that.

Ever since the previous Government’s austerity cuts, Brexit, and then Covid, there has been growing public anger that sacrifice has not been equally shared. The so-called trickle-down theory of economics has proven to be an elaborate con. To take one glaring example, in the financial year from 2023, the CEO of the outsourced services giant Mitie was paid nearly £15 million. That is 575 times that of a median worker at the company. I challenge any noble Lord to justify that.

Some noble Lords opposite may not like what trade unions stand for. In the other place, their party joined Reform in voting against better sick pay, an end to exploitative zero-hours contracts, and protection against fire and rehire. But when it comes to collective bargaining, I have yet to hear the Opposition come up with a better plan for workers so that workers can win a fairer share of the wealth that, after all, they helped create. Perhaps we can hear an alternative today.

In the meantime, as we have heard, the evidence is clear: when individual workers combine their working power, they are much more likely to win better pay, safety, skills training, family-friendly policies, workforce engagement and, ultimately, higher productivity—a good deal for workers and for their employers.

I congratulate my noble friend the Minister on the Government’s plan to reinstate the school support staff negotiating body and to establish a fair pay agreement for social care. This could be transformative, not only for the workforce but for the service and everyone who relies on its dedicated care. But we cannot stop there. We can debate the detail, but at the heart of my noble friend Lord Hendy’s amendment is the objective to spread the benefits of collective bargaining to more sectors of the economy. That would provide a level playing field for business, lift living standards, improve workforce well-being and boost company productivity, which in turn would aid fair growth.

In her response to the debate in Committee on 5 June, my noble friend Lady Jones, the Minister, said that the Government

“intend to learn from the first fair pay agreement process … before considering rolling out agreements in other areas”.—[Official Report, 5/6/25; col. 943.]

I understand the concern to learn from the success of the commitments already contained within the Bill, but it would seem sensible to take powers to introduce more sectoral agreements now, so that the Government are ready to act quickly in the future.

I know that the Government understand the absolute urgency of the need to tackle inequality in this country, to get living standards rising and to boost business investment in skills and productivity. Sectoral collective agreements are one of the quickest, most flexible and most effective ways to do just that. But, in the meantime, will my noble friend the Minister kindly undertake to facilitate a meeting with the relevant Cabinet Office Minister to explore how government procurement social value rules can promote fair work and a collective voice for workers?

[Lord Monks (Lab)]

My Lords, I am grateful to my noble friend Lord Hendy for directing our attention to collective bargaining, its historic importance in our national life and its relevance today.

Many in this Chamber today might know that the hero of establishing that collective bargaining system, which has been talked about by others, in 1928 was Stanley Baldwin, who was concerned about the excesses in the boardrooms of Britain. He regarded a lot of directors as profiteers. He promoted collective bargaining and trade unions as an antidote to that kind of greed. We now have another era of excessive boardroom remuneration and, in the absence of strong collective bargaining, too many boards do not seem restrained at all by the possible reaction of their workforce—and, boy, do they take advantage. More collective bargaining would help check this greed.

A start has been made. I will not go into the technicalities, but a start is made in the Bill’s provisions on fair pay agreements, including in the social care and school support staff sectors. We need a major step-up in British employment relations. We need a new system to improve productivity, investment and training. We need a new system based not on short-termism but on respect and investment in skills and capital. We need a new system which puts “them and us” behind us and bases itself on priorities, consultation and more equality.

Once this Bill—which does rebalance relations in this country to a considerable extent—is put to bed I ask the Government to go further and build an ambitious system which raises the national game. We can all do better in this country.

[Baroness Verma (Con)]

My Lords, in response to the amendments from the noble Lord, Lord Hendy, I want to explore the fact that we currently have strong representation from the unions. We have seen, through recent strikes, that there is an ability to go out there and voice your opinion.

My worry—I would like to have this recorded—as a businessperson, as my registered interests lay out, is that most of the businesses impacted will be SMEs, which are already predominantly very good employers. Most small and medium-sized businesses work with their workforce. We all wish to do well because we want better productivity, and it is not in our interests not to do so.

I remind noble Lords that my own grandfather was one of the founders of the Indian Workers’ Association because, at that time, unions were not properly representing minority communities. My worry is that we are going to go back to a place where people from minority communities, who do not actually know whether they have a choice to be part of a union or not, will have to come back into a union—whether or not they know that they are a member. I want to know from the noble Lord, Lord Hendy, how that would be clarified. There will be many from minority communities who work incredibly hard, are ambitious and aspirational, and want to end up owning their own business, who find that working and learning from employers is the best way to do it.

I fully support my noble friend’s amendment because I think that the world has moved on so much. Technology has enabled us to do so many things differently so that we are far more able to hold employers to account. There is no place to hide for bad employers. I do not think that the amendment from the noble Lord, Lord Hendy, will actually make a lot of difference to today’s workforce, as we are using a lot of new technologies to be able to make sure that the workplace is a much fairer place.

Employment Rights Bill

Lord Monks Excerpts

Report stage
Wednesday 23rd July 2025 Lords Chamber

[Lord Monks (Lab)]

My Lords, I oppose Amendment 147. The compromise formula that my noble friend Lord Barber has just talked about was a very practical solution to a tricky problem in the period when the noble Lord, Lord Burns, and his committee did such good work. However, I take issue with his claim that it was some kind of permanent solution, any more than was an agreement on contracting out reached by the Thatcher Government in 1984, headed by the noble Lord, Lord King of Bridgwater, who I am sorry is not in his place today, with the TUC. The provisions of that meant that the unions would be obliged to notify people regularly about the right to contract out, in the union journal and on the website, along with all the kinds of things that unions communicate with members about.

It is worth briefly dwelling on that. It stipulated obligations on unions, as I said—and we thought that we had a lasting settlement then, but we were wrong. In 2016, the then Government came along with a Bill to provide for general contracting in; they did not initially mention the King-TUC agreement and gave no initial examples of union abuses of it. They had made no approaches to the TUC or to any unions about things that were not quite working. The certification officer was happy with what was going on. It seemed to me that the Government at that time were either forgetting about the agreement—which they might have done, I guess, given the interval—or ignoring it. Only when I gave notice to the noble Lord, Lord King, that I was going to raise the question of the agreement in this Chamber in the initial debates on the Bill did the Government embark on a frantic quest to find examples of union non-compliance, which were later challenged by the TUC.

The Burns committee did its work and came up with a good deal—but why should it be regarded as permanent, any more than the TUC-King agreement was regarded as permanent? There is another problem with the Burns formula being regarded as permanent. Initially, in 2016, the bulk of union members remained contracted out only; it was only the new members that unions had to actively recruit. Of course, in the past nine years, the relative proportion of contracted-out and contracted-in members has changed considerably. If we give it another nine years, as in the period from the 2016 agreement to now, there will not be many contracted-out members left. In effect, what we will have seen is that the Burns formula in practical terms becomes a phased introduction of contracting in—and that is just not acceptable.

This is not an attack on the Burns formula, far from it, but it was of its time, as was the TUC-King agreement. The only permanent solution to this historic and bitter issue—because the history that my noble friend Lord Barber spoke about is a bitter one—will be a fair agreement on the fundraising of all the political parties, as my noble friend Lord Whitty has spoken about already. I oppose the amendment.

[Lord Balfe (Con)]

My Lords, it will probably not surprise noble Lords that I support the amendment. This situation has cursed the whole of the trade union movement’s relations with the Labour Party for far too long. As some of you will remember, I am the president of BALPA, the pilots’ union, a non-political union that does not have a political fund. In so far as it has ever been discussed in the union executive, the unanimous conclusion has been that to have a political fund would be extremely divisive and not a path that we should go down.

To some people, the solution to this situation— I will not call it a problem—is to pass a simple law saying that trade unions cannot make political donations. If we are not prepared to accept this compromise, then that is what we are drifting towards. If we look at the Labour Party accounts, we see that it gets far more money from non-trade union sources than from trade union sources. When I went through the accounts, I saw that there was one very rich lady who appeared to give more to the Labour Party than all the trade unions put together. I am not sure that she was of British nationality, either. But that is irrelevant—the fact is that political funding has got completely out of control in both parties. We need reform, but one interesting thing is that the arguments of the Labour Party appear to be very similar to the arguments of the diehard Conservatives as to why we should not abolish the hereditary peerage; namely, that we should wait for comprehensive reform. We are probably not going to get a comprehensive reform of political donations in this way. I would suggest that the compromise from the noble Lord, Lord Burns, is a very good one. It has worked and has kept the peace for a long time.

There has to be clear consent—to my mind, clear consent is a quite reasonable thing. Why should you not ask for clear consent before you deduct money from people’s contributions? It seems like a no-brainer to me. I would suggest that we leave things in place, adopt the amendment from the noble Lord, Lord Burns, and hope that this matter will go to sleep for at least another 10 years, during which time the parties will have as much time as they like to come up with reforms.

I should remind noble Lords that at the beginning of the Parliament Act 1911 on the reform of the House of Lords were the historic words “pending a full reform”. We are still told by Conservative Party Members that what is proposed by the Labour Party for the House of Lords is not a full reform. I have said, and will say it here, that we will never get one—we will never get that agreed.

I would like to see reform on the amount of money that people can put into political parties. I do not think that the people who put vast amounts of money into the Conservative Party do so because they have no expectation of any sort of reward. I think that they do it because they think that the Conservative Party will deliver what they want—whether that has happened is for them to now judge. The fact is that people do not support political parties other than with the aim of changing power and of getting changes in society.

My union general secretary, a certain Sharon Graham, has my full support, because for the first time in what I still think of as the T&G—my original union was AUEW-TASS—we have a general secretary who I think is fully behind the people who are paying her salary, and this is something quite different, but I think this demand is going to grow. If there was an open ballot in BALPA with a simple question, “Should we construct and set up a political fund?”, it probably would not get 10% in favour, because the whole way in which political funds have developed is not seen by the ordinary branch member as something they want to indulge in. Most of them see it as a sort of slush fund for the senior officers. I am sorry, but we have to face that and we need to get away from it.

So I hope that the amendment of the noble Lord, Lord Burns, will be accepted and that we will carry on with the admittedly unsatisfactory present system until we get this full reform that we have been asking for, although it will be a long time after I have left this place.