Seafarers’ Wages Bill [HL]

Lord Tunnicliffe Excerpts

2nd reading
Wednesday 20th July 2022 Lords Chamber

[Lord Tunnicliffe (Lab)]

My Lords, I thank all noble Lords who have spoken today, but I particularly thank the noble and learned Lord, Lord Mackay, for his contribution. I cannot match the eloquence of previous speakers, but I formally—for want of a better way of putting it—thank him on behalf of these Benches for his magnificent contribution over those 43 years. At a personal level, it has always been a pleasure to listen to his interventions, not just for his tone and style but for his wisdom. It is the sort of wisdom that melds both logic and personal values. In particular, we feel that his view of the world is to try to be more conciliatory. That is an important element in our deliberations. Too often, we lose that sense of trying to work for a common solution, and one always sees his interventions as trying to find out what someone really means and asking if there is some common ground. It is as if he had a personal ambition to make this House a better place for all of us to work. I thank him personally and on behalf of these Benches.

These Benches support the Seafarers’ Wages Bill, which we hope will mean that more workers calling at UK ports earn the equivalent of minimum wage. However, I am afraid that, in the aftermath of the P&O Ferries scandal, this will not be enough to give seafarers the security which they deserve at work. Seafarers kept this country stocked throughout the pandemic, but loopholes in the Bill will mean that many still will not receive a fair wage, and other key issues such as pensions and roster patterns are not even addressed. For this reason, we will seek to amend the Bill to give seafarers greater security at work, crack down on rogue employers and make sure that the P&O Ferries scandal can never happen again.

I turn first to the vessels which are in scope of the Bill. As drafted, vessels docking at UK ports must pay the equivalent of national minimum wage for the time spent in UK waters, but Clause 3 states that this will apply only to ships which

“entered the harbour on at least 120 occasions in the year.”

While most services will be covered by this, for some routes, such as that of the “Pride of Hull”, only slight adjustments to the timetable would allow them to escape paying a fair wage. The Government’s own impact assessment shows that the department considered applying the legislation to ships which dock on 52 occasions a year. Can the Minister explain why they have not pursued this option?

It is also not apparent why the Bill refers to “the harbour” rather than “a harbour”. This could open a loophole for vessels to dock at different ports to escape paying a fair wage. Has the Minister considered that possibility?

On the wages which seafarers will receive, it is disappointing that the passage of the Bill will not mean that a worker’s full wages will equate to the minimum wage. While the Bill states that seafarers must receive the equivalent of national minimum wage for the time spent in UK waters, workers could end up receiving far less than the national minimum wage in total because many European nations have no minimum wage. For example, in the hypothetical situation where a seafarer works for four hours in UK waters, on a national minimum wage of £9.50, and four hours in Danish waters, with no national minimum wage at all, in total the worker would receive an average of £4.25—half of the UK national minimum wage. While I appreciate that the Government are seeking bilateral memorandums of understanding to address this, the uncertainty in government could mean that policies such as these are abandoned. Can the Minister commit to pursuing such agreements in the Bill?

I am also disappointed at the narrow scope of the Bill and the lack of broader protections for seafarers. Despite initially being referred to as a harbours Bill, the Government have stripped back the Bill to focus on the narrow issue of wages, leaving out references to a seafarers’ framework, as well as other commitments from the nine-point plan. While I appreciate that secondary legislation will be introduced to enact other aspects of the framework, Ministers should place guarantees in the Bill, including in relation to pensions, roster patterns and collective bargaining. Will the Minister explain why the Bill is no longer a broader harbours Bill?

On the matter of enforcement and penalties, the P&O Ferries scandal should represent a line in the sand for seafarers’ rights. However, we cannot ignore the fact that bosses ignored existing protections because the fines were too weak. It seems that firms such as P&O are willing to look at fines as a mere cost of existing.

Although we support the inclusion of unlimited fines in the Bill, the lack of a minimum fine raises the prospect that precedents could be set for smaller penalties. Ministers should strengthen the penalties in the Bill to make sure that rogue employers can never again get away with flouting seafarer protection. Will the Minister explain the Government’s position on minimum fines?

Given that the Bill also allows harbour authorities to monitor compliance, as many authorities are also operators, this could end with employers marking their own homework. Will the Minister consider safeguards to protect this system from abuse?

Turning next to the regulatory powers, the Bill allows the Secretary of State to change which services this wage protection applies to. Although we would support the expansion of protections to more workers, there is a risk that these powers could be used to exclude workers. Can the Minister today commit to a principle of non-regression of seafarers’ rights?

Next, on the provisions which mean that harbour authorities will have the power to refuse harbour access in response to non-compliance, the Government must mitigate any risks and ensure that access is never refused when it is necessary for the safety of the crew. Although I am pleased that the Bill contains provisions for when authorities cannot refuse access, can the Minister confirm that this is in full accordance with international maritime law?

Finally, as we consider the implementation and application of the Bill, Ministers should consider the role that trade unions can play as experts in the safety and conditions of seafarers. The current situation means that P&O, Seatruck, Irish Ferries, Condor Ferries and Cobelfret are all still using the low-cost crewing model which P&O imposed on 17 March. As a result, ratings are often receiving below the national minimum wage pay and long contracts that cause fatigue.

The P&O scandal must represent a line in the sand for seafarers’ rights, but in its current state, the Bill falls far short of achieving that.

[Lord Hacking (Lab)]

Before my noble friend sits down, I should be grateful if I could intervene for a moment to apologise to the House, most particularly the Minister and the noble and learned Lord, Lord Mackay, for my absence during the past hour. I had a commitment with the Lord Speaker that neither he nor I could change, but I apologise for not being here. I am greatly sorry to have missed a number of the speeches that your Lordships gave in my absence.

Seafarers’ Wages Bill [HL]

Lord Tunnicliffe Excerpts

Committee stage
Wednesday 12th October 2022 Grand Committee

[Lord Tunnicliffe (Lab)]

My Lords, the amendments in this group relate to the territorial scope of the Bill and the vessels to which this legislation applies. Seafarers across the board deserve proper compensation for their work and I welcome the opportunity to consider whether the Bill, in its present form, achieves this. To this end, I hope the Minister will clarify that all workers on the vessels listed in these amendments are already covered. When we landlubbers think of seafarers, we often picture those who directly control vessels, but the definition is incredibly wide and covers everyone from cleaners to the administrative staff on board. I hope the Minister comments on the Government’s approach to supporting better wages and conditions for all seafarers.

Amendment 5 in my name is a probing amendment and it is key. It seeks information from the Minister on the state of negotiations, particularly those with France and the Republic of Ireland, on the corridor concept. This Bill, which we support, is one small step towards addressing the issue of seafarers’ terms and conditions.

I respect what my noble friend Lord Berkeley just said but, at the end of the day, if these international conventions have achieved utopia for seamen, I would hate to see hell. Wages seem incredibly, unacceptably low in an international world. Perhaps that is not so true in the wider world, but they seem unacceptably low in Europe. I hope the Government put all possible energy into negotiations with other European states to establish these corridors. It sets a precedent for the worldwide consideration that seafarers deserve a better deal than they are getting.

Amendment 23 would prevent the refusal of harbour access where doing so would break international maritime law. In any situation in which harbour access is refused, in framing the appropriate guidance, a Government must have considered the safety and environmental implications of refusal. It moves to the general view that we must work on the international agreements in parallel and seek to ensure, as does the amendment in the name of the noble Baroness, Lady Scott, that the various conventions not only exist but are universally and even-handedly implemented.

[The Parliamentary Under-Secretary of State, Department for Transport (Baroness Vere of Norbiton) (Con)]

My Lords, I am grateful for the careful consideration of this Bill by all noble Lords. I reiterate what I have already said to noble Lords in private sessions: the Government are listening to concerns and will endeavour to answer in full all the questions raised by your Lordships today. I suspect that some will certainly be in writing, and I may well try to develop on some on some of the things I am able to say today so that we have full information as we head towards Report.

I sense that there are slightly differing views around the Committee, where some people want this to go much further and others are very cautious. Of course, both of those views potentially risk the Bill itself. I therefore just want to make sure that everybody has as much information as I can get out, particularly around the Government’s intent with the Bill and why it is drafted as it is. Noble Lords will have heard the previous Secretary of State speak about the nine-point plan many times, which was in response to the P&O decision that was made back in March. We recognise that this Bill is narrow in scope and potentially also in effect, as we cannot legislate outside UK territorial waters. It is none the less an important part of the nine-point plan that this sits hand in glove with the other work that we are doing to improve the welfare of seafarers to make sure that their terms and conditions are as good as they can be.

The amendments in this first group cover territorial scope and international law and I will try to address them in turn. Amendment 1 from the noble Lord, Lord Hendy, seeks to probe the application of the Bill in various circumstances. I completely accept the way that he introduced this and that he had intended some separate amendments that were deemed to be out of scope. It is worth making sure that the different groups of seafarers who he identified in his amendment are indeed covered. To look at it in more detail, on proposed new subsection (1A)(a), seafarers working or ordinarily working in the UK, including UK internal or territorial waters if the vessel is not exercising a right to innocent passage, are already entitled to the national minimum wage. That stems from Section 1(2)(b) of the National Minimum Wage Act 1998 and Article 2 of the National Minimum Wage (Offshore Employment) Order 1999. That change is therefore unnecessary, and I think the noble Lord would agree.

On proposed new subsection (1A)(b), voyages to or from the Crown dependencies would already be in scope of this Bill under the service definition in Clause 1. Of course, I recognise at this point that the UK Government can legislate only in the waters of the UK; therefore, it would be a similar circumstance as one would have, for example, with a journey to France.

On proposed new subsection (1A)(c), under Article 2 of the National Minimum Wage (Offshore Employment) Order 1999, a worker working or ordinarily working in connection with the exploration of the seabed or subsoil or the exploitation of natural resources in the UK sector of the continental shelf is treated as if they are working, or ordinarily work, in the UK. Those workers are therefore already entitled to the national minimum wage, so, again subject to the caveat about UK territorial waters, those workers are covered—ditto those who are working on services to offshore renewable energy installations. Again, I note that some of those may be far away from UK territorial waters. I hope that that reassures the noble Lord.

I note the point raised by the noble Lord, Lord Tunnicliffe, that it is not only the people who are in control of the ship. When I think about this, I do not think about the people in control of the ship but of all the other people on board, who do the really important day-to-day tasks that are sometimes forgotten. I accept that this is about making sure that we cover everybody on board, and I am satisfied that we do.

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[Lord Fairfax of Cameron (Con)]

My Lords, I apologise; I have only just arrived, because I was detained elsewhere. I want to pick up on the point of the noble Lord, Lord Berkeley, about ferries. Ferries have been referred to, so maybe the Minister can clarify this later. I need to read the Bill again, line by line, but nowhere does it refer to “ferries”. It refers to “ships”. In the current energy crisis, for example, you may have a service of tankers of diesel fuel coming in with the required regularity. They might be caught by the Bill, because of the frequency with which they call on the UK as part of their service, but they are certainly not ferries. The Minister will confirm this later, but I do not believe we should use the language of “ferries”, when we are in fact talking about ships.

[Lord Tunnicliffe (Lab)]

My Lords, this is a useful set of amendments to clarify some of the points. I hope that the Minister will either be able to provide that clarification or, if she wants to worry about the syntax of her reply, supply it in a careful letter.

I have two amendments in this group. Amendment 10 seeks to replace 120 with 52 in Clause 3(3), so I sit alongside my noble friend Lord Berkeley and the noble Baroness, Lady Scott. My noble friend made a persuasive case for 50, as opposed to 52, and I will need considerable persuasion not to press this point on Report, unless the Minister is able to create a very powerful argument that there would be unintended consequences from that.

Amendment 36 seeks, in essence, to stop the effects of the Bill being, in a sense, destroyed by repeated regulations. Surely the Bill’s minimum requirements are in the primary legislation, and the adjustments to them should really be only upwards, not reducing the requirements.

I also join the noble Baroness, Lady Scott, in her concern about the DPRRC’s concerns. In my day, if it produced a recommendation, we used to shake in our boots and recognise that some deal or other had to be made with it because of the authority it carried. Once again, I hope the Government will recognise the authority and wisdom of that committee and accede to its suggestions.

[Baroness Vere of Norbiton (Con)]

My Lords, I am again grateful to noble Lords for sharing their thoughts on this group of amendments. The thrust of the amendments in this group is very much around probing the scope of the Bill in terms of the services and ships to which it applies. As the noble Lord, Lord Tunnicliffe, noted, I will write. I do not think he was implying that my oral replies are not carefully thought through—maybe he was—but the letter will be perfect. Noble Lords should await further information in the letter, but I will try to cover as many points as I can.

I look at this borderline, grey-area conversation that noble Lords are having, and at the back of my mind I keep thinking, “What sort of an operator are you if you will go to a different port in order to drop your frequency down to be just under or over any particular target so that you don’t have to pay your seafarers the national minimum wage equivalent in UK waters?”

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[Baroness Vere of Norbiton (Con)]

The Government are very willing to define what these services are and, by implication, those have close ties to the UK. I can probably come up with lots of other clever descriptors to define these sorts of services. A large container ship stopping at the UK once a month does not have close ties to the UK; it is an international container ship, shipping around wheat or whatever it might be shipping. We can think of some other language, but once we have nailed what the service is, where it goes, how frequently it goes and which ships it utilises, then we have defined it. That is it, we are done. That is the definition that works legally because it has hard boundaries and can be fairly well defined, I think.

I absolutely appreciate that Amendment 27 is a probing amendment. We intend to provide guidance to harbour authorities, and that guidance will be consulted on. We can define what the service is but we need to help harbour authorities to fully understand those definitions. We will consult with the industry to make sure that there is absolute clarity. I would not say that the guidance should be put on a statutory footing; that is not entirely necessary in this particular case.

I turn finally to Amendment 37. I have of course seen the DPRRC report. It was published only a few days ago so I beg your Lordships’ leave just to say that, at this stage, we are considering what is in it. We are taking it very seriously; I reassure the noble Lord, Lord Tunnicliffe, that we take all DPRRC reports very seriously. We will publish our response to it before Report so noble Lords will have the opportunity to peruse that. I have no doubt that we will be able to have further conversations about that.

[Lord Tunnicliffe (Lab)]

Will the Minister be answering on Amendment 36?

[Baroness Vere of Norbiton (Con)]

I absolutely shall cover Amendment 36. My apologies, I slightly went off-beam so I thought I had already covered it.

Regarding Amendment 36, the clause as drafted does not allow a Government to amend or reduce the overall extent of services in scope of the Bill. It provides only that regulations may make different provisions for different cases, including for different descriptions of service to which the Bill applies or non-qualifying seafarers. This power cannot be used to amend the Bill and is not intended to be used to alter the scope of the Bill. I slightly thought that I would need to come back to this particular issue to make sure that noble Lords are in agreement as to what we are trying to achieve here. I will give that further consideration.

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[Baroness Randerson (LD)]

My Lords, we do not have any amendments in this group, but I take this opportunity simply to make the point that we share the concern of those noble Lords who do have amendments in this group. These are important issues that reflect the reasonable fear that employers could use tactics that circumvent the measures in the Bill.

One thing that has been speculated on is that seafarers could be paid at a lower rate when they are outside UK waters to compensate for the higher rate that they must be paid in UK waters. There are things about which the Government can do nothing, but it is really important that the things that can be got right are looked at carefully to ensure that they are absolutely on the nail. I point in particular to Amendment 26 in the name of the noble Lord, Lord Tunnicliffe, to emphasise the importance of monitoring the effectiveness of this legislation and engaging with the trade unions. P&O’s tactics—the audacity with which they were announced surprised everyone, I think—exposed the weakness of the current safeguards. However, if the Government attempt to plug the loophole but fail to do so effectively, I fear that P&O would not be alone and other owners would attempt to do something similar—perhaps not as blatantly as the way in which P&O did it, but it certainly could undermine legislation further if the Government’s efforts here are not fully effective.

[Lord Tunnicliffe (Lab)]

My Lords, I will speak on the two amendments in my name in this group, but I commend the other amendments to the Minister’s study, because it is important to achieve clarity on some of these issues.

On Amendment 25, my original involvement with these sorts of issues was in an analogous industry—transport—where I was a shop steward and subsequently an industrial relations manager. In the crew situation, issues with roster patterns and pensions are every bit as important as wages. The way that rosters are handled in particular can have a serious impact on remuneration and a massive impact on quality of life. It is important that there is a proper impact report on these issues, ideally within 90 days.

This leads on to Amendment 26, because this and other issues would be much enhanced if we could develop a proper relationship with the trade unions. The importance of this from the point of view of the trade union movement is exemplified by an appeal—for want of a better term—to the International Labour Organization from the general secretary of Nautilus; the general secretary of the RMT, Mick Lynch; the general secretary of the TUC, Frances O’Grady; the acting general secretary of the European Transport Workers’ Federation; the general secretary of the International Transport Workers’ Federation; and the general secretary of the International Trade Union Confederation. I read those out to emphasise that this is a heavy coalition of the trade union movement. Their appeal is set out in a document that I hope the Minister has seen, which centres on what happened at P&O. It helps one to understand how broad detailing and managing the employment conditions of crew is and how important it is to get a hold of this to make sure that crews are properly looked after, both in their remuneration and conditions of work. I therefore commend Amendment 26 to the Minister.

[Baroness Vere of Norbiton (Con)]

My Lords, this third group of amendments is broadly concerned with the relationship of this Bill to the domestic national minimum wage. The noble Lord, Lord Hendy, has already decided that Amendment 3 is not necessary; I agree with him so, if noble Lords agree, I shall just move on.

Amendment 13, also in the name of the noble Lord, Lord Hendy, relates to the calculation of the national minimum wage equivalence and deductions. We have been clear that this will be covered by regulation and is not for the Bill. This also allows us a little more flexibility decades hence, should changes need to be made. Nevertheless, Section 2(5)(c) of the National Minimum Wage Act 1998 does not prohibit deductions from pay of costs for providing seafarers’ accommodation, food or water, but simply provides for regulations on the matter. We will very much be matching up.

Regulations under the Bill will need to be consistent with the provisions within the Maritime Labour Convention, or MLC, whereby requiring seafarers to meet the cost of food and water is expressly forbidden. We therefore do not need to amend the Bill to account for this. Perhaps the noble Lord might remind the RMT about that, if it feels that seafarers out there are being charged for those things. That is clearly and expressly forbidden.

Regarding deductions for accommodation, under the National Minimum Wage Regulations 2015, employers on domestic services are permitted to apply a reduction of up to £8.70 per day in respect of the provision of living accommodation, without that affecting the assessment of the worker’s pay for national minimum wage purposes. The MLC does not make express provision for reduction for accommodation, and shipping industry practice is not to charge seafarers for accommodation. It is not our intention that operators should be encouraged to make such reductions for accommodation to reduce their overall wage fee, so we will be considering this in the regulations in due course.

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[Baroness Randerson (LD)]

My Lords, I start by thanking the noble Lords, Lord Berkeley and Lord Mountevans, for joining us on some of these amendments. I will briefly underline some of the points that my noble friend and those noble Lords made.

The complexity of expecting ports to do what is essentially the Government’s job for them will undermine the effectiveness of this legislation. Think about the use of the term “surcharge”. You pay a surcharge when you use a service voluntarily; it has no implication of illegality. If, however, a company finds itself paying a surcharge according to the rubric of this Bill when it becomes legislation, it will have broken the law. In other words, it is paying a surcharge as a fine—and a fine should be called a fine. I urge the Minister to look again at the phraseology here. Let us be clear: if companies are going to be fined, let us call it a fine.

The other issue is the complexity of expecting ports to deny access to the harbour. The international law on denying access to a harbour is complex and it would be difficult for them to do so. They would have to be absolutely sure that there is no question of danger to life. As a result, they will err on the side of caution and it will not happen. As both the noble Lord, Lord Berkeley, and my noble friend Lady Scott said, detaining ships is a normal course of events. It is not done frequently but it is done, and for safety reasons as well. I urge the Government to have the courage of their convictions and give these powers to the Secretary of State, because they are much more appropriately those of the Secretary of State.

It is not as if the Government do not want to be involved, because Clause 11 gives them wide-ranging powers of direction. It essentially gives them control, so the Government want that control behind the scenes but do not have the courage to put their name on the notices. That is a strange approach, so I urge them to rethink the way this is to be done. The impact would be that well-meaning and very important legislation could be undermined. At the same time, it would put our ports in a difficult position, make their relationship with ship owners more complex and create for them, as other noble Lords said, a conflict of interest.

[Lord Tunnicliffe (Lab)]

My Lords, I have a couple of amendments in this group. The first is Amendment 12, which would create a minimum fine of £1 million. Whether that is the right figure, I am not sure, but the real concern is about the size of the owners; I believe that P&O’s owners have made $721 million in the past six months. There is a real risk that, if businesses of this size take an almost doctrinal opposition to the measure—the P&O debacle showed such a doctrinal opposition to reasonable conditions on board ships—a fine that is not substantial becomes just a cost of business. That would be regrettable; I am sure that it is not the Government’s intention but I would value some feedback from the Minister. How does one assure oneself that the fines are sufficiently large to impinge on the decision-making of these companies? There is a concern that good companies do the right thing anyway. The trouble is that we have a very real example in the recent past of one of these companies not doing the right thing; that is what provoked this legislation.

The second area concerns naming the inspector or inspectors. I tabled my amendment here to draw out how the world will know that this is happening. Organisations that have either a principal inspector or someone like that as a named individual are so much clearer as to who will be held to account for appropriate levels of activity. As a minimum, I hope that the Minister will be able to give me a feel for how quickly inspectors will be appointed and how many of them there will be, as well as assure us that there is adequate inspection capability. We know that this whole issue of minimum wage enforcement is pretty difficult in a land situation; at sea, it will be much more difficult to get the details to know whether an offence or the wrong charge has been committed.

With that, I come to the amendments in the name of the noble Baroness, Lady Scott, regarding the Secretary of State having the authority to determine the tariff, which will really be a fine. I think that harbour authorities are about harbours. I can see why they perhaps must be drawn in at one level but when it comes to becoming a policeman, in essence, that is what the state should be doing. I agree with the general thrust that this should be the Secretary of State’s responsibility.

Finally, I hope that the Government will give careful consideration to the amendments addressing the DPRRC’s concerns.

[Baroness Vere of Norbiton (Con)]

My Lords, this fourth and final group of amendments is concerned broadly with incentives, enforcement and compliance. There is a wide range of amendments herein. It has been helpful to have this discussion today.

I will start with Amendment 4, with which the noble Lord, Lord Hendy, seeks to make requesting a national minimum wage equivalent declaration a duty rather than a power that can be used with some discretion. The payment of national minimum wage equivalent would be a condition of port entry and so should be a matter for the harbour authority to decide. Furthermore, by making this a “may” rather than a “must”, we are allowing for flexibility in circumstances where there might be overlapping harbour authorities, for example where a vessel transits through one harbour authority’s area of jurisdiction to call at a port within another harbour authority area of jurisdiction. There may be other circumstances that noble Lords can think of where it is not necessary that this declaration is shared every single time. It should be noted that the Bill provides the Secretary of State with the power to direct harbour authorities to request a declaration, so there are necessary safeguards against harbour authorities not discharging this function properly.

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There have been a number of further mentions of different international considerations—the OECD common principles, for example. I will address those in writing. Obviously, as your Lordships know, the Government’s intention is not to share their legal advice, but we will be able to set out our position on how we feel this Bill works with other international obligations that we have.

[Lord Tunnicliffe (Lab)]

The noble Baroness promised to write letters. Will it be a common letter to all of us?

[Baroness Vere of Norbiton (Con)]

Yes. I tend to do one letter addressed to all noble Lords present. A copy will be placed in the Library. It will be lengthy, but it will be set out by topic and cover, with as much detail as I can, things that I have not been able to cover today and any additional information that would be helpful to noble Lords.

Seafarers’ Wages Bill [HL]

Lord Tunnicliffe Excerpts

Report stage
Wednesday 26th October 2022 Lords Chamber

[Lord Tunnicliffe (Lab)]

My Lords, to make some general comments, we welcome the Bill. I think everybody has been shocked by P&O’s behaviour, but this goes a bit deeper than that. I had no idea how badly seamen are paid. It is disgraceful. This is clearly a worldwide problem, and there are problems with addressing it from a singular point of view.

I also object to the criticism of my noble friend by the noble Lord, Lord Forsyth, because this has been a normal Bill. We could not vote in Grand Committee for the usual conventional reasons. It was well debated—the noble Lord would know that if he had been present. Essentially, Amendment 2 is a judgment about degree, and we come to a different judgment than the Government. While we support the Bill in general, we have amendments where we think that a little finesse will make it more effective. A weekly service is the sort of thing that should be within the scope of the Bill. While we will not press Amendment 1, we will support the noble Lord if he wants to press his Amendment 2 to a Division.

[The Parliamentary Under-Secretary of State, Department for Transport (Baroness Vere of Norbiton) (Con)]

My Lords, I am very grateful for all contributions on this first group. I appreciate the support from Members on my own side; it is always good for the Minister to know that there are a range of views and that people are thinking about the Bill and taking it seriously—it is a very serious Bill.

The noble Lord, Lord Tunnicliffe, mentioned the welfare of seafarers. He is absolutely right and there are mechanisms, which the UK is deeply embedded in and has been for a very long time, which work internationally, as many noble Lords will know, to try to improve the conditions and pay of seafarers. However, that is not under discussion today. As pointed out by the noble Lord, Lord Greenway, this is an important part of the nine-point plan that Ministers set out earlier in the year, but the Bill is narrow in scope and effect. That is for many reasons but a key one is that we have to be mindful of the extent to which we are legislating; we have to be mindful that we do not overreach, because that might have some very serious unintended consequences that we would later regret. That is why, throughout the drafting of the Bill, we have had at the front of our minds not only international law but our international obligations; that is critical. Although I accept that there are many things that noble Lords would very much like to do for seafarers—and that, probably, on the face of it, I would like to do too —the reality is that, as a Government, we have to be sensible and potentially a bit boring. We must stay in our lane and make sure that we do not overreach, because the consequences would be very significant.

There are two amendments in this group. The first brings back the old chestnut of “the harbour” versus “a harbour”. I am grateful to the noble Lord, Lord Berkeley, for enabling that discussion once more. I cannot go much further than I went in Committee; I just state that it is absolutely important that unless we say “the harbour”, we cannot define what a service is. A service is from one point—the point—to another point. It is of great regret that the word “a” crept into the letter, but noble Lords can imagine that that was the overarching ambition: from a point overseas to a point in the UK, but “the harbour” within a place overseas and a place in the UK. Because we have defined it that way, from “the harbour” to “the harbour”, we capture the high-frequency services that, let us recall, can be serviced by any vessel—you can put another vessel in when one is off being maintained or whatever—but it is always between two specified harbours.

The second part of that definition—the harbour to the harbour—that is very important is

“120 occasions in the year”.

That, essentially, defines a service that has close ties. The second point about this is that unless you define it as “the harbour” to “the harbour”, it would be incredibly difficult to enforce the Bill, because the Bill relies on one harbour authority being responsible for monitoring and enforcement. Individual harbours may be able to anticipate that a particular service will call in its harbour 120 times a year, perhaps because that service has been doing so for years, if not decades. That harbour authority may not be able to anticipate whether a particular operator has services to other ports, so how would the enforcement and monitoring work in those circumstances?

The noble Lord, Lord Berkeley, brought up an example about, I think, a former Transport Secretary and ships that could be brought in to operate services, but he reinforced the point I am trying to make: it is not about the ships or the specific seafarers on a particular service; it is the service itself that we must make sure falls within the Bill’s scope.

I am content that we have defined the scope well. I am a little disappointed that I have not given sufficient explanation such that the noble Baroness, Lady Randerson, is content, but I feel that we are there and have clarified exactly what would happen. In response to concerns raised about services suddenly deciding to go to another port so that they do not have to pay seafarers a fair wage, as I said in Committee, I do not think that would be commercially viable. I do not think operators would play switcheroo with UK ports because, frankly, their customers would not put up with it. I do not think that point works.

I hope the noble Lord will withdraw the amendment to change “the harbour” to “a harbour”. It would make the entire Bill not worth the paper it is written on, and it would not function in the way that I know the noble Lord wants it to function.

I turn now to Amendment 2, which seeks to decrease the threshold frequency from 120 times a year to 52. The figure of 120 was arrived at following very thorough and extensive consultation and bilateral discussions with industry and other stakeholders. We have looked incredibly carefully at the patterns of services, noted by the noble Baroness, Lady Randerson, and at maritime traffic data by type to reach the figure in the Bill. The scope of the Bill captures services calling 120 times a year on purpose. It is a very specific number that balances the need to maintain close ties with wanting to do the very best we can for seafarers.

The rationale is clear. It covers the vast majority of passenger ferries, including ro-pax, non-passenger ferries and ro-ro services calling at the UK. Critically, it focuses the Bill on short sea services, which justifies the connection to the UK and therefore the UK-equivalent level protection of pay. We do not want to bring into scope some of the high-frequency deep sea container services. That would not be our intention at all and, as my noble friend Lord Forsyth mentioned, would completely change the scope of the Bill and would go against the Government’s intention.

For the UK to impose pay requirements for seafarers on foreign-flagged ships that call at its ports only once week would risk being seen as an overreach by international partners. It would weaken the justification for the UK taking legislative action. As my noble friend Lord Forsyth said, we must tread with care. I appreciate that the noble Lord’s intention is to protect as many seafarers as possible, but the Government can justifiably legislate only for those with close ties to the UK. To seek to do more could risk making the Bill inoperable and could damage the UK’s reputation internationally.

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[Lord Hendy (Lab)]

My Lords, as a member of the Delegated Powers and Regulatory Reform Committee, I support all these amendments. The Government accepted the committee’s recommendation in relation to Clause 3 and introduced Amendment 3; they should also concede Amendments 6 to 9, and preferably Amendment 10.

The problem is that the Government have made harbours the enforcers of the Bill, in particular by way of imposing surcharges. That reveals the flawed structure of the legislation. The arguments are by now familiar so I will outline only three of them.

First, the national minimum wage equivalent for seafarers should not be enforced by harbours, some of which are wholly conflicted since they share ownership with the shipping lines they are to police. I do not understand how the noble Baroness could say in her letter to us of 21 October:

“The Government is confident that there are no conflicts of interest.”


Instead, the declaration of compliance should be received by, and the prime enforcement body should be, a state authority. The obvious candidate is the MCA.

Secondly, there should have been provision for seafarers or their unions to enforce the national minimum wage equivalent, not least by making the entitlement to it contractual.

Thirdly and lastly, enforcement by way of surcharge is, with respect, inappropriate. It is a penalty and the noble Baroness’s letter to us, of 21 October, says of surcharges that

“Rather than being a punitive measure, its purpose is to make it not worthwhile for an operator to underpay their seafarers.”


Of course that is so, but then there is no distinction of purpose between a fine and a surcharge. One suspects that the real reason that a surcharge is preferred to a fine is that it avoids the stigma of a criminal sanction, which is, if that is true, an unattractive justification given that we are all here seeking to prevent repetition of the disgraceful behaviour of companies such as P&O Ferries. Such companies should be stigmatised by criminal prosecution if they underpay their seafarers.

[Lord Tunnicliffe (Lab)]

I thank the Minister for Amendment 3. Moving on to Amendments 6, 7, 8, 9 and 10, I am more sympathetic with the Government than any of the previous speakers. These sorts of powers are necessary. Arguably, the way pressure is put on harbours to do the right thing is wrong, but it is the way the drafters of the Bill have chosen.

I wish the Government would get back to the tradition of doing what the DPRRC says, which way back, when I sat on those Benches, we did. However, none of those things will probably happen and, certainly, I do not feel it is an issue over which we would support dividing the House. I would, however, recommend that the Minister allay some of the fears that these clauses have provoked, by reading into the record the statement made to the DPRRC on 25 October, particularly, from the bottom of the page in the report:

“The policy intention is that this power would only be used in the following circumstances”


and all those circumstances, to the end of that document. In the best Pepper v Hart frame, the world would then have easy access to those limitations, much improving the likelihood of the Government sticking to those limitations. Of course, if she wants to amend the document more fully, I would not be averse to her bringing this back at Third Reading. However, I can tell from her demeanour there is not a prayer of that, so would she agree to putting those assurances into the record?

[Baroness Vere of Norbiton (Con)]

I will indeed take option A from the noble Lord, Lord Tunnicliffe. I accept that we do not want our powers to be overreaching. I believe there is a good justification for these powers, and I will happily read into the record the circumstances in which the Government believe it would be justified to use these powers.

I will quickly address the amendment from the noble Lord, Lord Berkeley. I do not believe he will press it to a vote because it would remove all of Clause 11 and then it would remove the guidance for the harbour authorities, so it would be incredibly messy.

Let us focus on the second element of the concerns from the DPRRC. We have very carefully reflected on its recommendations. We have looked very carefully at the powers of direction for the Secretary of State in Clause 11. We have concluded that to remove them would significantly reduce the effectiveness of the Bill. These powers of direction form an important part of the compliance mechanism under the Bill. Without that power of direction given to the Secretary of State, there will be no means of correction if the harbour authorities do not exercise their powers under the Bill, or if they exercise their powers inappropriately. Given that noble Lords have raised concerns about potential conflicts of interest between harbour authorities’ commercial interests and statutory functions, these powers also provide a safeguard against this risk. I assure noble Lords that the power is not intended to have general effect to allow the Secretary of State simultaneously to direct all harbour authorities to exercise or not to exercise their powers under the Bill, or to exercise them in a particular way. Nor is it intended to modify the character of the Bill itself by means of direction.

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[Lord Hendy (Lab)]

My Lords, I support this amendment for the reasons put forward by the noble Baroness. In the Minister’s letter to us of 21 October, she said that sufficient notice will be given of a contravention that will result in refusal of access, so that a vessel will not start its voyage. If that is so—which many doubt—the same notice that the vessel will be detained for transgression will no doubt preclude it coming to port as well. If adequate notice is not given, detention is safer for the vessel, its cargo, its passengers and other vessels than if the defaulting vessel is refused access just outside the port in question. The arrest of ships for non-payment of debts that are payable to seafarers, the port or third parties is a common and international practice. I for one am at a loss to understand why the Government do not accept that practice here.

[Lord Tunnicliffe (Lab)]

My Lords, there is quite a good case for the noble Baroness’s amendment, but I accept that the Government have, I hope, expended an awful lot of effort working through the intricacies of how this will happen. I fear that passing the amendment at this point would unduly stop this extremely important Bill’s progress. I hope that the Government’s judgment is correct, and that they come back very rapidly with emergency legislation if it proves to be incorrect.

[Baroness Vere of Norbiton (Con)]

My Lords, the amendment in this group in the name of the noble Baroness, Lady Scott of Needham Market, relates to the refusal of access. The refusal of access is one way in which we establish the provision of national minimum wage declarations as a condition of access to ports. If this were replaced by a power of detention by the MCA, this would become a punitive measure and go beyond the voluntary mechanism envisaged by the Bill. Detention of vessels is a disproportionate and inappropriate mechanism in these circumstances. Detention of ships can also carry a significant cost to the port by blocking a berth, which is not the case if they are refused access.

The noble Baroness, Lady Randerson, has previously expressed concerns that refusal of access is unworkable as it might result in ships mid-passage being unable to dock, but this is not how the Bill will work in practice. By virtue of the high-frequency requirement, all services captured are almost certain to be on short routes, and access refusal would take place before a ship has set sail from the origin port. As set out under Clause 9, we will set out in detail in the regulations how the harbour authority is to communicate refusal of access, which will ensure that sufficient notice is given to prevent this possibility happening and to provide notice for users of the service to make alternative arrangements. We will of course be consulting closely with the ports on these draft regulations.

As an additional safeguard, the Secretary of State has a power to direct the harbour authority as to how or whether it discharges its power to refuse access, which will ensure that access is not denied where it would cause damage by disrupting key passenger services and supply chains critical for national resilience.

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Moved by

[Lord Tunnicliffe]

5: After Clause 9, insert the following new Clause—
“Implementation and monitoring
(1) Within 90 days of this Act being passed, the Secretary of State must publish a report on the implementation of, and monitoring of the effects of, this Act.(2) The report must include—(a) an assessment of the impact of this Act on—(i) roster patterns,(ii) pensions, and(iii) wages of seafarers;(b) a statement as to whether further legislation will be introduced by the Government as a result of the findings of the assessment under paragraph (a);(c) a strategy for engaging with trade unions for the purposes of monitoring the implementation of this Act, including in reference to conventions of the International Labour Conference;(d) a strategy for monitoring the establishment of minimum wage corridor agreements with international partners of the United Kingdom, insofar as any such agreement ensures that any non-qualifying seafarer is remunerated for UK work at a rate that is equal to or exceeds the rate that would otherwise be required under this Act. (e) an assessment of the interaction between this Act and existing international agreements or international maritime law, including reference to any litigation that has arisen as a result of this Act.(3) The report must be laid before each House of Parliament.”Member’s explanatory statement
This amendment would mean that the Secretary of State must publish a report on the implementation and monitoring of this Act.

[Lord Tunnicliffe (Lab)]

My Lords, P&O’s behaviour shocked all sides of the House. Until that happened, I suspect—I cannot know this—that few of us understood just how badly seafarers are treated. It provoked the Government into introducing this Bill and I thank them for that, but it is only a first step. It also reminded us just how badly some private companies will behave if not restrained by sensitive law and regulation.

The Bill addresses pay, but only in a narrow area. As a former pilot shop steward, and subsequently an industrial relations manager, I know how critical these other issues are. This amendment is our attempt to address them.

Subsections (2)(a) and (2)(b) of our proposed new clause address rosters, pensions and wages and require the Government to determine whether further legislation is required. We expect that it will be.

Subsection (2)(c) requires the Government to set out how they intend to engage with trade unions in monitoring the implementation of the Act.

Proposed new subsection (2)(d) touches on the extremely important initiative of establishing international minimum wage corridors, so that seafarers are properly protected for the whole of their employment in these corridors. The Government have already started work on this issue and this amendment will strengthen their arm. It is important for the House to understand what these corridors will achieve. If carried out effectively, they will extend the effect of the Bill so that it has real bite at the two ends of the route—and, I hope, sensibly in between.

Proposed new subsection (2)(e) will require an important assessment of how the Act will interact with existing maritime laws and agreements.

This amendment will strengthen the Bill in a sensitive way. I beg to move.

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[Baroness Vere of Norbiton (Con)]

My Lords, this final group contains one amendment in the name of the noble Lord, Lord Tunnicliffe. I have listened very carefully to what the noble Lord had to say and to all noble Lords who participated in this debate.

In my response I will have bad news and then good news. First, I will address why the amendment as it stands is not appropriate. As my noble friend Lord Balfe pointed out, I am afraid that after 90 days, to coin a phrase, nothing will have changed. There will not be regulations in place, the guidance will not be in place and there will be little, if anything, actually to report on. Therefore, the fundamental premise of having a report in 90 days will, unfortunately, not achieve what the noble Lord is looking for.

Looking at the detail of the amendment, proposed new subsection (2)(a) goes back to the point that my noble friend Lord Balfe made. It is true that we pass laws but we do not forget about them; there is always the process of the post-implementation review, but we would have to wait five years for that. I accept that that is a long way away and possibly not ideal, but it would cover pensions and pay. I will retain the position that to cover rostering would be a challenge because there are many different impacts on rostering. It may be that we can decouple them but I would not want to make that commitment now.

Proposed new subsection (2)(b) goes beyond the implementation and monitoring of the Bill. I understand that noble Lords wish to probe the UK Government’s plans for legislation, but I cannot say that we currently have plans to legislate further than is necessary. I have already noted that we must tread with caution, but we are already taking action on the areas beyond the matter of minimum pay, which, as I think noble Lords will all agree—indeed, as I agree—is not the only aspect of seafarer welfare that requires attention.

Noble Lords, including the noble Lord, Lord Hendy, mentioned the seafarers’ charter; I will get an update for him on where we are with it. In government terms, if the latest version was published in August, that is not as bad as I feared; I thought the noble Lord might have said April. But I will provide a written update afterwards on where we are and what the next steps are, because that is incredibly important.

Turning to proposed new subsection (2)(c), we always engage with the unions and recognise the importance of doing so. We have discussed the Bill with the unions. I do not feel that a written strategy of union engagement would be helpful; it would not be flexible enough and may miss things or include things that are no longer appropriate, and it would mean that we would be too constrained. I am absolutely sure that noble Lords would be the first people to write to me if they felt that unions were somehow being cut out of discussions.

Proposed new subsection 2(d) refers to

“a strategy for monitoring the implementation of”

bilateral wage corridors. Again, I appreciate the noble Lord’s interest in this important area and we are working hard to seek agreements. However, publishing a strategy for the implementation of a bilateral wage corridor may in itself be counterproductive, as many noble Lords discussed in Committee. These corridors will be memorandums of understanding and backed up by domestic legislation in each country, so their implementation will be different in different countries. Proposed new subsection (2)(d) would be a step too far in the current circumstances.

On proposed new subsection (2)(e), we do not consider that the Bill’s proposals interfere with rights and obligations under international law, including the United Nations Convention on the Law of the Sea, or UNCLOS. We therefore would not deem it necessary to state as much in the Bill.

In potentially better news, although I cannot commit to legislating for a report, I can reassure noble Lords that we are currently looking at governance structures to deliver Maritime 2050. Noble Lords will know about that very important document; it sets out the Government’s vision and ambitions for the future of the British maritime sector. This governance structure will include the delivery of the nine-point plan. Furthermore, the Government are planning annual joint industry and government progress reports—it is almost as though my noble friend Lord Balfe read my notes beforehand. Every year we will have an annual joint report between the industry and government. It will include progress on the nine-point plan, implementation of the Bill, the seafarers’ charter and an update on bilateral wage corridor negotiations. I feel that is pretty much what noble Lords are looking for. On the basis of this reassurance, I hope the noble Lord feels content to withdraw his amendment.

[Lord Tunnicliffe (Lab)]

I almost feel that the noble Baroness totally agrees with me but not quite enough. The amendment is meant to be helpful—it is helpful. I note that she more or less said that virtually everything in the amendment was right. I just want this in the Bill, so I feel that I have to divide the House on this point.

Seafarers’ Wages Bill [HL]

Lord Tunnicliffe Excerpts

3rd reading
Monday 7th November 2022 Lords Chamber

[The Parliamentary Under-Secretary of State, Department for Transport (Baroness Vere of Norbiton) (Con)]

My Lords, in moving that the Bill do now pass, I would like to reflect for a couple of minutes on the Bill and its passage. This legislation, although necessarily limited in scope, is a key part of the Government’s nine-point plan to improve seafarer welfare and working conditions. The Bill delivers on the Government’s commitment to ensure that employees with close ties to the UK are paid at least the equivalent of the national minimum wage while they are working in the UK or its territorial waters.

I reiterate the Government’s intention to continue working closely with ports, the shipping sector and unions as the Bill continues its passage through the House of Commons and, crucially, as we develop secondary legislation. We are very grateful to stakeholders for their constructive engagement and interest in the legislation so far and are keen for this to continue.

I will also take this opportunity to clarify a point I made in Committee about seafarers servicing oil and gas platforms. I had previously stated that seafarers on services to offshore renewable energy installations were also covered by virtue of Article 2 of the National Minimum Wage (Offshore Employment) Order 1999. I would like to correct the record and confirm that they are not entitled to the national minimum wage under existing legislation but are considered to already be in scope of the Bill if calling at a UK port more than 120 times per year.

As ever, I thank the noble Lord, Lord Tunnicliffe, and the noble Baronesses, Lady Scott of Needham Market and Lady Randerson, for their constructive approach to each stage of this Bill and to all other noble Lords who contributed, many of whom brought deep and specific expertise. Last but definitely not least, I pay tribute to the work of the parliamentary counsel as well as the House staff, the Bill team, my excellent private office, and my noble friend Lord Younger for his support.

[Lord Tunnicliffe (Lab)]

My Lords, I will comment briefly. The Bill is an important first step in the nine-point plan. I am very pleased that the Minister has reiterated her commitment to proceed on that plan; we all wait to see early progress. I will be studying the words relating to the clarification. I thank her and her support staff for the way that she has conducted the Bill. I do not have as many people to thank on my side, but I thank my adviser—who wrote some excellent speeches that the House heard—for supporting this work, and all noble Lords who took part.

[Baroness Scott of Needham Market (LD)]

My Lords, we on these Benches are absolutely committed to the Government’s aim of improving the pay and conditions of our seafarers. During the passage of the Bill, we heard some egregious examples which gave evidence as to why we need the Bill.

However, we do have concerns about the Bill that remain, falling broadly into two categories. One is the issue of compliance with international conventions, a number of which are potentially challenged by this legislation; the second is over issues around implementation and enforcement, which have been raised by the chambers of shipping, the British ports authorities and the trade unions. All of these have been thoroughly debated; although we continue to have reservations, we saw no point in bringing forward any amendments at Third Reading. I know that the Minister is committed to dialogue with the stakeholders and, therefore, we still hope that some practical ways of dealing with some of these issues may yet emerge.

The general health of the shipping industry is addressed in the Government’s nine- point plan. I was encouraged to hear the Minister on Report talking about the annual report prepared jointly with industry; we can all look forward to reading and potentially debating that. I thank the noble Baroness, Lady Randerson, who has been affected by the rail strikes today and is therefore not here, and the Liberal Democrat Whips’ Office, as well as the Minister’s private office and her team of civil servants for her constructive and always helpful engagement with us.