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Employment Protection Law

Volume 542: debated on Thursday 15 March 2012

10. What representations he has received on the potential effects of his proposed reform of employment protection law. (100029)

I receive a wide variety of different representations on employment law reform, including from business groups and trade unions that I meet on a regular basis. The reforms aim to give business greater confidence to take on staff, while protecting fairness for employees.

Will the Secretary of State confirm that his consultation on no-fault dismissal has been delayed because, as one Lib Dem put it, “Conference delegates will go mental”? If even his own party members are against it, why does he not stand up to Downing street and reject this despicable policy?

Does my right hon. Friend agree that countries with flexible labour laws have the best growth and those with inflexible labour laws have the highest unemployment; that the more we can do to ease employment by reducing regulation the better; and that this should be done as a matter of urgency, especially in the context of Europe?

My hon. Friend’s basic premise is correct. I am sure that he has read the recent report by the Organisation for Economic Co-operation and Development, which said that Britain has the second most flexible labour market in the OECD, and that is what we want to retain.

First, I congratulate the new Minister for employment law, the Under-Secretary of State for Business, Innovation and Skills, the hon. Member for North Norfolk (Norman Lamb). I am disappointed that he is not answering this question, but let me put it on record that he has been courteous and constructive in his role so far, and I wish him at least a modicum of success. [Interruption.] That is as far as my generosity goes, I am afraid.

With no plan for growth and consumer confidence at its lowest in decades, the Government are trying to make it easier to fire, rather than hire, people. There is an ongoing pitched battle between the Department for Business, Innovation and Skills and Downing street, with the Secretary of State being dragged kicking and screaming to a no-fault dismissal consultation on which, indeed, a written statement was issued only 10 minutes ago. The new Minister said in October:

“I think it would be madness to throw away all employment protection in the way that’s proposed, and it could be very damaging to consumer confidence”,

and suggested that it was crazy. Does the Secretary of State agree with his new Minister?

The interesting thing about this controversy is that we are being attacked with such vehemence from the left and the right, which suggests that we are just about in the right place.

We welcome the publication of the Beecroft report today. Leaks reported in the media suggest that something of a fire-at-will culture will be instilled. Does my right hon. Friend agree that, at a time when many employees are suffering an uncertain future and feel vulnerable, that would do nothing for good employment relations or, indeed, for productivity?

The so-called Beecroft report had a series of recommendations, most of which were sensible and unobjectionable, and are being implemented. Indeed, we are championing some of the recommendations, for example those on visas, in Government. So far, there is one area of disagreement, which relates to the no-fault dismissal issue. We want to strike a balance between making it easier for micro-companies, which have genuine difficulties with staff management because of their small scale, and the danger of creating general insecurity in the labour force. I will proceed on the basis not of ideology or vested interests, but of evidence. That is why we are calling for evidence today.