My Lords I beg leave to ask the Question standing in my name on the Order Paper.

The Question was as follows: To ask Her Majesty's Government what is the latest position on the River Severn barrage project, and when their response to the report on the project is due to be announced.

My Lords, Her Majesty's Government have recently received the report of the Severn Tidal Power Group which has been engaged for the last two to three years in a study, partly funded by Government, to assess the viability of a private sector barrage across the Severn estuary. The report is comprehensive and detailed. Consultations are taking place with the Severn Tidal Group and other interested parties before a response can be made.

My Lords, while I thank my noble friend for that interesting Answer, can he assure the House that it is still the Government's view that the potential of the Severn's tidal power is as great as any in the world and indeed greater than the project brought to a successful conclusion at La Rance in France?

My Lords, yes, indeed. This is potentially the second largest tidal barrage in the world and is certainly larger than that in France. There is one in Nova Scotia which is presently the largest, but this would be the second largest in the world.

My Lords, can the noble Lord tell me whether the report which the Government have received refers to the shorter barrage or the longer one from Weston-super-Mare?

My Lords, this would be the near-Weston-super-Mare to near-Cardiff barrage.

My Lords, is the noble Lord aware that it is generally agreed that this is a very important project? Does he recall that in another place on 18th April his honourable friend in answer to a question from Mr. David Mudd, said that the report would be published shortly? It is now 24th June, nine weeks later. Can the noble Lord say when we are likely to see the publication of the report, and will a copy be placed in the Library?

My Lords, I am afraid that my answer is still "shortly", but I hope that the period will be shorter than the one mentioned the last time such a question was asked. I shall indeed ensure that a copy of the report is placed in the Library.

My Lords, perhaps I may follow up my noble friend's question and the noble Lord's reference to "shortly". Does the noble Lord recall that four-and-a-half years ago, in February. 1982, we had a debate in this House on the Bondi Report and his noble predecessor, on winding-up that debate, said, if I recall, that the Government would shortly be reporting after they had considered the issues? How long does it take for this Government to make up their mind—four-and-a-half years? In view of the great concern and interest in Wales in this project and the high unemployment in the Principality, and bearing in mind that it is thought that if this project were put in hand, it would provide several thousand jobs, will the noble Lord be a little more specific and be good enough to accelerate the response to the report?

My Lords, in fact I do not think that the noble Lord will have long to wait. Following the publication of the Bondi Report, the Government promoted the Severn Tidal Power Group's report, which was half-funded by the Government. Originally the group was expected to report within two years. In fact, the report was published in May, 1983; so it has taken slightly over three years. However, one must remember that it is an extremely large project and, as the noble Lord, Lord Cledwyn, said, very substantial job opportunities are linked to it.

My Lords, does my noble friend agree that hydrologists and engineers have been working on this since the first design in 1849?

My Lords, I am sure that my noble friend is right, but I am afraid that my memory does not take me back quite that far.

My Lords, does the noble Lord appreciate that this matter has many facets? Therefore perhaps he will forgive a third member of the Opposition Front Bench asking a question. My question has transport connections. As a review concerning a second Severn crossing is under consideration, have the two groups been liaising?

My Lords, the report produced by the Severn Tidal Power Group will concentrate on the energy-producing aspects. However, in their response the Government will have to take into account not only that but the environ-mental impact on the area, plus of course the possibility of a road crossing, which is what I think the noble Lord, Lord Underhill, was referring to, and also of course the possible effects upon recreation and tourism.

My Lords, will the Government satisfy themselves that, if this barrage is built, migratory fish going up or down the Rivers Severn and Wye will be able to pass through the barrage without excessive loss, and that consequently there will not be severe losses to the stocks in those and other rivers?

My Lords, I am sure that that is one of the matters which will be taken into consideration.

My Lords, I beg leave to ask the Question standing in my name on the Order Paper.

The Question was as follows: To ask Her Majesty's Government what response they have received from the Inner London Education Authority to the letter from the Department of Education and Science concerning the teaching pack Auschwitz: Yesterday's Racism.

My Lords, as my noble friend Lady Hooper said in a Written Reply to the noble Lord on 3rd June 1986, the authority accepts that parts of the teachers' guide to the pack are inappropriate and has undertaken to revise them.

My Lords, I thank the noble Earl for that reply. Given the deplorable nature of this particular piece of propaganda, relating, as it did, to the death of many millions of Jew in concentration camps, to the Prevention of Terrorism Act, and the dispute over GCHQ, may I ask him whether the Inner London Eucation Authority has now agreed to withdraw this teaching pack from schools pending the revisions which I understand are now being made to it?

My Lords, I understand that ILEA has said that it will not issue any more copies of the pack until the text has been revised. The department has written to the authority suggesting that the pack be withdrawn meanwhile if the necessary amendments cannot be made quickly, and the reply to that has yet to be received.

My Lords, can my noble friend go a little further and say that this pack is so monstrous that it should be withdrawn? It is not a question of not issuing any more. If you have sinned and been found out, you should be redeemed by withdrawing all the copies which now exists in our schools.

Yes, my Lords; I agree entirely with my noble friend that this pack is monstrous, and that is why the department has written to the authority suggesting that the pack be withdrawn.

My Lords, if the noble Earl or the department do not receive a reply very soon indeed from the Inner London Education Authority, can we take it that the Secretary of State will make it clear that he expects this guide to be withdrawn forthwith, and that if it is not he will consider what other steps to take?

My Lords, I think that the noble Lord would have me answer a hypothetical question. It would not be right to do so because matters are not helped by conjecture, and the Government in fact decide their actions on the basis of the circumstances of an actual case. They would need to know, for example, if matters fell out as the noble Lord's question implies, why it was that ILEA has decided to act in that way. What I can say, though, is that in such an event we would scrutinise very carefully indeed the circumstances of the case and the authority's reasons. I can also add that if we do not receive a reply in the very near future we shall be taking up the matter again with ILEA.

My Lords, is the Minister aware that this is not the same authority to which the letter originally went? Since the original letter was sent there has been an election and a new authority has been elected. Will the noble Earl give it time to settle in first?

My Lords, the letter went on 29th May. As I understand it, even if elections take place it is still the same authority, though the personalities may have changed. We have given it a lot of time. By the same expression, we do not expect it to take very much longer to answer.

My Lords, my noble friend has answered the question I was going to ask, which was the date at which the department had written to the Inner London Education Authority. In view of the fact that no reply has been received, how much longer is my noble friend going to wait before taking further action? Would he not agree that his last but one answer was worthy of the very best of Sir Humphrey Appleby?

My Lords, I should be delighted to be compared with Sir Humphrey. The answer to my noble friend's question is: not very much longer.

My Lords, would it be possible for a copy to be put in the Library of the House? The word "Auschwitz" has terrible memories for so many of us.

My Lords, I am not quite sure what the noble and learned Lord is asking for a copy of.

My Lords, a copy of the document which has now been the subject of question-ing for the past 10 minutes.

My Lords, I shall undertake to the noble and learned Lord and other noble Lords to have that placed in the Library forthwith, but I think it may horrify some of your Lordships.

My Lords, I did not mean to be discourteous to the noble Earl. We are old friends.

My Lords, without intervening on the merits of this case may I ask the noble Earl the Minister to at least bear in mind the limited powers that the Secretary of State has in all these matters? When I was involved in a dispute with a local authority which six weeks after an election had not met to elect its chairman, I was turned down by the House of Lords for wrongfully interfering with that local authority.

My Lords, the noble Lord is not the first person to have had trouble with this noble House.

My Lords, would the noble Earl agree that as well as putting the original document in the Library he will also put the revised text into the Library at the same time?

My Lords, I undertake that when it is produced, that will be done.

My Lords, I beg leave to ask the Question standing in my name on the Order Paper.

The Question was as follows: To ask Her Majesty's Government whether, in the light of the Land's End tragedy in 1985, advice is being given by the Department of Education and Science to schools to help improve safety procedures during school visits and expeditions.

My Lords, in March of this year the Department of Education and Science issued a bulletin (Safety in Education Bulletin No. 4) to local education authorities and to schools, containing general guidance to all involved with the organisation of outdoor pursuits and school expeditions. The bulletin supplemented previous departmental guidance on the subject and in particular drew on lessons arising from the Land's End tragedy.

My Lords, I thank my noble friend for that reply, and I congratulate his department on this extremely good bulletin. Will my noble friend please assure the House that expeditions and visits have not been restricted since this disaster last year? Will he also tell us whether all schools have received this bulletin?

My Lords, I am glad to say that I think that schools continue to produce a number of educational and outdoor expeditions. I understand that the numbers are not in fact falling off. Copies of the bulletin have been distributed widely through LEAs and other education bodies who are free to reprint the guidance to schools and colleges without copyright restriction. I cannot answer my noble friend as to whether every school in England and Wales has received a copy of it.

My Lords, does my noble kinsman agree that it would be most useful if the teachers and children in all schools had first aid classes, especially before undertaking expeditions?

My Lords, I think that that would be a good thing. In fact Her Majesty's inspectors and the department concentrate on getting the right advice out to schools to see that these awful accidents do not take place so that first aid is not necessary.

My Lords, I beg leave to ask the Question standing in my name on the Order Paper.

The Question was as follows: To ask Her Majesty's Government why they have not accepted Mr. Gorbachev's offer to agree to verification by seismic monitoring stations inside the Soviet Union as part of a comprehensive test ban treaty.

My Lords, the qualified nature of such offers would not provide adequate levels of verification for a comprehensive test ban treaty.

My Lords, while I thank the noble Baroness for that Answer may I ask her why the Government have not pursued the matter further? Why did they block all measures and all proposals to move towards negotiations in Geneva? Why did they even block an Australian compromise proposal that a draft should be drawn up to outline the objective negotiation? Why do the Government apparently not want to discuss this subject? Is the position really that they do not want a comprehensive test ban?

No, my Lords, that is not the position. I have made clear on this occasion and on many others in your Lordships' House that the crucial question is one of verification.

My Lords, will the Minister be good enough to reaffirm that last July the Government put forward proposals for verification? I should like to know what the Soviet reaction was to that? What have the Soviets done about our proposals?

My Lords, I am grateful to the noble Lord, Lord Mellish, for raising that point because last July the United States proposed an exchange of test site observers and invited Soviet observers to visit a United States test site. This goes to the heart of the issue, which is verification, and it is a matter of much regret that the Soviet response so far has been dismissive.

My Lords, does the noble Baroness recall her reply to a recent parliamentary Question—that if negotiations were to be resumed, questions other than concerns over verification would need to be addressed? Will she say what these other questions are and whether they include the need of the American or British Governments to make further tests?

My Lords, I recall the Question that the noble Lord asked a little while ago. The other matters which would have to be dealt with are scope, duration and compliance; but the key issue is verification.

My Lords, will the noble Baroness agree that international scientific advice is that verification techniques are now extremely accurate? Secondly, will she confirm what I thought she said before—that a comprehensive test ban treaty is one of the Government's clear objectives?

My Lords, we should like to see a comprehensive test ban treaty. With regard to the question of verification and recent scientific advances, to which the noble Lord referred, and indeed the claims that verification is not a problem, particularly in the light of advances in seismology, the Government do not agree, and we do not believe that the recent arguments advanced invalidate the conclusions of a United Kingdom paper presented to the Conference on Disarmament in July 1985. For example, these arguments concentrate largely on detection, ignoring problems of discriminating between explosion and earthquake.

My Lords, will the noble Baroness say whether the Soviet Union gave any reasons why they did not take any action or refused to consider our proposals of last July?

My Lords, they have not indicated their reasons.

My Lords, may I ask the noble Baroness to clarify her reply to me just now? Was she saying that questions other than verification, which would need to be addressed if negotiations were resumed, would not include the need of the United States or British Governments to make further tests?

My Lords, what I said to the noble Lord on the question that he asked me about other issues that have to be raised besides verification on a test ban treaty related to difficult questions such as the scope of the treaty, its duration and its compliance. But the key issue is verification.

On the other point that the noble Lord asked about concerning testing—he has asked about it several times—we are committed to making progress. We are committed to maintaining the effectiveness of our nuclear capabilities; but it is a hypothetical question at the present time to ask what would happen under a test ban treaty.

My Lords, but the question remains: why are the Government even refusing to examine the Soviet proposals for on-site seismic verification?

My Lords, among the most recent developments is an agreement only in principle, though it is not yet confirmed, of the Soviet acceptance of United States monitors. But the Russians apparently are prepared to accept non-official American scientists to start stations in the Soviet Union but are not prepared to talk to the United States Government scientists about verification. The Soviet proposal suggests that non-official US scientists should be admitted to the Soviet Union. The Americans are prepared to agree that Soviet Government scientists should be admitted to the United States. Clearly this is a difference of view, but we hope that there might be a resolution of it.

My Lords, at a convenient moment after 3.30 this afternoon my noble friend Lord Davidson will, with the leave of the House, repeat a Statement that is to be made in another place on restriction on the movement of sheep.

It may be for the convenience of the House if I announce that the Committee stage of the Wages Bill will be adjourned at approximately 7.30 p.m. for approximately one hour and that during this adjourn-ment three Representation of the People Regulations and the Committee stage of the Consumer Safety (Amendment) Bill will be taken.

rose to move, That this House do concur in the resolution communicated by the Commons in their Message of Wednesday last.

My Lords, I beg to move the Motion standing in my name on the Order Paper.

My Lords, I beg to move that this Bill do now pass. Before we leave this matter, it would be churlish not to congratulate the promoter of this Bill in another place, the Member for Banff and Buchan, Mr. Albert McQuarrie, for his ingenuity and resourcefulness in bringing it forward. His was the first work in drafting; he pursued it through, and one would hope that such a useful Bill, which after all carries the mantle, as he himself does, of the noble Lord, Lord Boothby, will be remembered as the McQuarrie Bill. I beg to move.

My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.

moved Amendment No. 1:

It may be for the convenience of the Committee if I speak now, with leave, to Amendments Nos. 2, 13, 70 and 112.

Would the noble Lord forgive my interrupting him? I am very grateful to him. There is an objection because they are totally disparate considerations that arise under this Amendment No. 1 and on Amendments Nos. 2, 13 and 70. It would import, with the greatest respect to the noble Lord, an intolerable degree of confusion if he were to try to deal with two wholly separate and distinct concepts at one and the same time. If the Committee is with me on this, I would respectfully suggest that we deal with the amendment of the noble Lord, Lord Wedderburn, and then in due course deal with the other set of amendments.

Hear, hear!

I am in the hands of the Committee. I had understood that there was a measure of agreement that this was the procedure which should take place. Perhaps the noble Lord, Lord Trefgarne, would help us on behalf of the Government.

I hope my noble friend will feel able to agree that we should proceed in the way proposed by the noble Lord, Lord Rochester. As my noble friend will appreciate, considerable discussions go on through the usual channels as to how we should handle these matters; and if they fall apart as soon as we get to the Floor of the Chamber very often we find ourselves considerably detained. So I hope my noble friend, at least on this occasion, will feel able to agree that we should discuss the amendment of the noble Lord, Lord Rochester, with the one proposed by the noble Lord, Lord Wedderburn.

I am obliged to my noble friend the Minister. Quite clearly, the usual channels have messed this one up, but if they have done it, they have done it and we had better get on with it.

I think it was our intention that, although the noble Lord, Lord Rochester, could speak to both amendments, there would be a separate vote on our amendment. We intend to press our amendment to a separate vote. Therefore, if the noble Lord were in a position in which he wanted to support one rather than the other, he would in the end be able to do so.

It was worked out and that is why I said at the outset that it was my intention to speak to these amendments, rather than at this stage to move any. Like the amendment which has just been moved by the noble Lord, Lord Wedderburn, the amendments to which I referred—perhaps for the convenience of the Committee I should just repeat that they are Nos. 2, 13, 70 and 112—are aimed at ensuring that deductions from wages are reasonable, but they set about the task in a way different from that proposed by the noble Lord, Lord Wedderburn.

At the Second Reading of the Bill I expressed the view that there was a strong case for a code of practice to be drawn up by the Advisory, Conciliation and Arbitration Service after consultation with other interested parties to facilitate the implementation of Part I of the Bill. In response the noble Lord, Lord Trefgarne, assured me that guidance material would be produced before Part I commenced and added that ACAS was also aware of the suggestion that it should produce advice on aspects of the Bill.

Since then I have come to feel that the area which could most usefully be covered by such a code is that of deductions from wages, particularly in relation to the form which the relevant term in the contract of employment should take. Indeed, it was a discussion in another place of the need to build on good practice in this matter which led the Under-Secretary of State to say, first, that he should perhaps be responsible for recommending that ACAS should produce guidance on it and then, more specifically, that it would be a good idea if ACAS was to propose a draft form of contract.

Between them, the amendments to which I am now speaking seek to take the matter a little further, first, by providing in Amendment No. 2 that deductions from wages should accord with a code of practice; secondly, by requiring the Secretary of State—that is, under Amendment No. 13—to issue such a code prior to the date on which Part I of the Bill comes into force; and, thirdly, by stipulating in the new schedule referred to in Amendment No. 70 that the objective of the code should be to ensure that deductions from wages are fair and reasonable. The terms of the proposed code of practice are set out in the schedule and they follow closely Section 3 of the Employment Act 1980, except that in this case the issuing of the code by the Secretary of State would be mandatory rather than, as in 1980, permissive.

Initially, as under the 1980 Act, the Minister would have to consult ACAS, publish a draft code, consider representations made to him about the draft, and have the draft approved by both Houses of Parliament. Once it was introduced, failure to observe the code would not render an offender liable to proceedings, but in any proceedings before a court or industrial tribunal the provisions of the code would be admissible in evidence and could be taken into account in determining any relevant question. Amendment No. 112 is consequential in simply enabling the process of introducing the code to begin at the time the Bill is passed, rather than waiting until the rest of Part I of the Bill comes into force.

If I may turn to the amendment which has been moved by the noble Lord, Lord Wedderburn, it follows from what I have so far said that I am in sympathy with its objective. As he said, the Bill as it stands does not even uphold the existing statutory safeguards, particularly those which were a feature of the Truck Act provisions of 1896. In general, the contract of employment should, in my view, be regarded as inviolate—that is, as between the employer and the employee—but the principle that deductions from wages should continue to be reasonable in amount seems to me to be of such basic importance that it should be treated as an exception to the general rule. My only doubt is whether a requirement that the deduction should be,

"reasonable in amount having regard to all the circumstances of the case",

to quote the terms of the amendment just moved by the noble Lord, Lord Wedderburn, would of itself prove effective.

In two recent well publicised cases concerning petrol station attendants—the noble Lord referred to one of them—the courts have done their best to interpret the law as it now stands, but in doing so they seem only to have succeeded in adding to current doubts about its application. It appears questionable, therefore, to me whether the insertion in this subsection of a test very similar to the one now in operation would serve its intended purpose.

The aim of my amendment is to see that it has a better chance of doing so by providing additionally for a code of practice containing practical guidance on this subject. In my view this would both diminish present uncertainties and produce a welcome measure of consensus in what would otherwise remain a contentious area. Indeed, I have enough faith in ACAS to feel that if the task of drawing up such a code were entrusted to it, the outcome would prove generally acceptable. I hope, therefore, that the Committee will support the introduction of a code of practice of the kind proposed in this amendment to facilitate implementation of this part of the Bill. I shall not move this amendment, but will leave the matter there for the time being.

May I first speak to Amendment No. 1 and then, with the Committee's leave, to Amendments Nos. 2, 13, 70 and 112. I speak in opposition to both amendments in the names of the noble Lord, Lord McCarthy, and the noble Lord, Lord Rochester. On Amendment No. 1, I have listened with that degree of attentive awe which any practitioner owes to a law don, but I fear that I am unable to follow the logic of the argument of the noble Lord, Lord Wedderburn, other than on the basis that, as he said, consent by contract has become a fiction—a proposition with which I hope your Lordships' Committee will not agree.

Amendment No. 1 is open to serious objection because it has to be seen in context with Amendment No. 4, which seeks to excise paragraph (b) of Clause 1(1) from the Bill, and unlike the amendments in the name of the noble Lord, Lord Rochester (Amendments Nos. 2, 13, 70 and 112), it does not impose an unacceptable qualification on Clause 1(1) (b); it simply seeks to excise it.

There are three grounds of objection to Amendment No. 1 moved by the noble Lord. First, there is the imposition of a wholly unacceptable qualification on subsection (1) (a).

When we come to the amendment concerning Clause 1(1)(b) I shall be happy to explain to the Committee and to the noble Lord its purport, but at the moment he should not assume that its relationship is either alternative or otherwise to the amendment we are discussing.

I am assuming that it is both, because it is either one or the other. If noble Lords will be good enough to look at Amendment No. 4 they will see that it excises Clause 1(1) (b). If it excises Clause 1(1) (b), in those circumstances the objection is to excision, because who better than the worker to judge in this day and age whether he should signify his consent? Therefore it is objectionable on that ground. If it does not excise Clause 1(1) (b) it is objectionable because if Clause 1(1) (b) is left in it imports a wholly impracticable qualification affecting the operation of Clause 1(1)(b). I know the noble Lord intervened to assist, but, with respect to him, I had worked this one out, and whichever way you put it there is a problem. I am seeking, not unkindly I hope, to expose the problems that lie within the proposed amendments. That is the first objection.

The second objection as I see it is the one to which I have referred—the excision of subsection (l)(b), taking the point that it is an alternative objection. The third is that Amendment No. 1 read in context with all the amendments to Part I of the Bill in the name of the noble Lord—

I wonder whether the noble Lord with his usual courtesy will allow an intervention, because this is upsetting the whole rules that govern us in discussion at Committee stage. We are either discussing amendments that have been moved or by arrangement are to be spoken to or we really find ourselves in complete disarray. Amendment No. 4 has in no way been moved. My noble friend may decide when he comes to Amendment No. 4 either to move it or not to move it, but if we start discussing amendments which by arrangement are not to be discussed and assume that they are going to be moved, we really end up in chaos. Since the noble Lord was anxious to avoid chaos before, in his submission to the Committee, I am sure that he will now wish to avoid it in his own case.

The noble Lord, Lord Mishcon, for once and wholly exceptionally fails to do me justice. The whole problem arises because one has to look at Amendment No. 1 objectively. If you look at it without Amendment No. 4 it raises the objection which I have made. If you look at it—and I take only a moment to say it—with Amendment No. 4 it raises the objection to which I have also spoken. I am not speaking to Amendment No. 4. This is one of the reasons I was hoping that these two sets might be dealt with separately. I hope that I have satisfied the noble Lord on that.

I come to the third and last objection to Amendment No. 1. If you look at Part I of the Bill as the Government propose it should be—there are no government amendments to Part I—and if you look at Part I of the Bill wth Amendment No. 1 and the set—I say no more than that—of Opposition amendments in the name of the noble Lord, the whole structure of Part I which is broadly intelligible and satisfactory is drastically altered. The hope must be that my noble friend the Minister will not accept Amendment No. 1 for the reasons that have been given, because any qualification by this Bill which qualifies as distinct from repealing or amending (and one goes to Clause 1(l)(a)) what,

"is required or authorised"

by statute or alters what has been agreed under a contract of employment makes a vast general superimposition on existing statute law which is wholly unacceptable and also indeed on the freedom of contract.

Those are the basic objections to the first amendment. The set of amendments moved by the noble Lord, Lord Rochester, raises quite different objections. I have listened with due deference to the noble Lord, who speaks with authority on all matters relating to good working relations between management and staff, but the objections to this set of amendments go not only to form but to substance. First, the provisions of Part I of the Bill operate to ensure that the deduction should be fair and reasonable in all the circumstances, broadly; secondly, the proposed injection by paragraph 1 of the Schedule—and the Committee will find that in Amendment No. 70—of standards of what is fair and reasonable could operate to qualify retrospectively existing statute law or obligations under the employment contract under Clause l(l)(a); or to negative matters of consent in writing, no doubt given on the basis of independent advice under Clause 1(1)(b).

The third objection is that because the obligation is upon the Secretary of State to issue a code of practice under paragraph 1 of the Schedule—that is in Amendment No. 70—and is upon Parliament under paragraph 4 to approve the code, and upon courts, tribunals and the Central Arbitration Committee to take the code into account under paragraph 7, that is neither appropriate nor requisite; nor indeed is it acceptable. There is an internal conflict in the proposals of the noble Lord, Lord Rochester, which, with respect to him, makes no sense because in (2A) in Amendment No. 13 you have the type of code that has no legal effect at all. It is a mere practical code of guidance that is not taken into account. If you look at paragraph 7 of Amendment No. 70 you see the type of putative effect of the code. The two lie in irreconcilable conflict and the source of confusion is all but unimaginable.

The set of triple amendments is objectionable on that ground. The further objection is basic. What the noble Lord, Lord Rochester, has done is to make a fundamental departure from settled practice under which the trigger clause which introduces the code, and which determines the legal efficacy, is found in the body of the Bill and not, as he has put it, in the schedule. Paragraph 1 of the schedule, which mistakenly he has put in the schedule instead of in the body of the Bill (hence the conflict) is borrowed from Section 3 of the Employment Act 1980. A similar section is found in Section 6 of the Employment Act 1976.

I shall not detain the Committee but there is, in any event a very serious objection, recorded in the debate on 15th January in which the noble Lord was good enough to take part, as to resort to this type of code—and it is all on record in Hansard. It has given rise to concern. It is the type proposed in paragraph 7 of Amendment No. 70. To borrow a phrase in another context from Churchill, it is neither one thing nor the other. Although it is admissible under paragraph 7(a) in Amendment No. 70, there is no sanction whatever if it is not taken into account under paragraph 7(b). There is no appeal and there is no judicial review. It is mere putative efficacy dressed up as a sort of legal doll. If a code is needed—which is much to be questioned because ACAS has certain responsibilities which it could discharge—then either it should be the code of practical guidance which is the very type proposed in subsection (2 A) of Amendment No. 13, or it should be a code having full legal effect such as is taken into account at first instance and then can be taken into account on appeal or judicial review; analogous, as the Committee will remember, to the Commons amendment to the Animals (Scientific Procedures) Act 1986. There is another example which will be moved on Report in respect of the Bills dealing with the disabled and gas next week.

Therefore, this set of amendments of the noble Lord, Lord Rochester, proposes a type of code which follows an evil precedent. The form of the set of amendments is open to objection on the ground of irreconcilable conflict. It departs from settled practice and it imports wholly unacceptable qualifications into Clause 1 of the Bill. For those reasons, which are quite distinct from the reasons on Amendment No. 1,I hope that my noble friend the Minister will not accept that set of amendments.

As between these two amendments, I should like one or other of them to be accepted, but of the two I prefer that proposed by the noble Lord, Lord Rochester. Let us think for a moment of the problem under the 1896 Act. That applied only to manual workers. It did not apply to people working in shops, and the like. Under that Act it was permissible for an employer to make deductions from his men's wages so long as he put up a proper notice warning them about it. In addition, he could deduct from their wages subject to this: the men had only one form of complaint—they could not go to the civil courts or to a tribunal but had to prosecute the employer before the petty sessions magistrate and had to prove that the deduction was not fair or reasonable.

No wonder that in those days nobody went through that archaic procedure. No man did. I remember no case brought before my court under those Acts in all the years I sat. In the last year or two some petrol garage people have become alive to the situation and as the noble Lord, Lord Wedderburn, said, some petrol attendants, and so on, have been faced with contracts or notices enabling the employer to deduct everything—all the deductions and so on—from the workers' wages. That was taken before the magistrates and then before the Divisional Court and it was held to be not fair or reasonable. It was a very proper decision, if I may say so, but it is time that we had another attempt to put the law on this matter on a proper footing.

As I read this Bill and these clauses they go a long way towards putting everything in proper order. There has to be a proper contract for the employee. He must have signified his agreement to it in writing. The employer must then deduct in accordance with that contract and there is provision that he cannot deduct more than 10 per cent. That is a very good way of dealing with the matter. Moreover, if the man is dissatisfied and states that it is not good enough, he can go before the tribunal. That is all right and proper.

However, there is one omission from this Bill which was in the 1896 Act—it must be fair and reasonable. That is why I suggest—and the noble Lord, Lord Wedderburn, was quite right—that many of these so-called contracts are a pro forma. A form is set before the man and he signs it without reading it. Members of the Committee will have done that dozens of times in contracts that they have signed. These printed forms are hopeless and time after time I have said in the Court of Appeal that they ought to be fair and reasonable. Under the Unfair Contract Terms Act 1977 the legislature has said that many commercial contracts, with all these exemption conditions, are enforceable only if they are fair and reasonable.

Therefore, we should have in this Bill a provision to ensure that deductions can be made only in accordance with a contract that is fair and reasonable. In the circumstances of the case, whatever the man has done, the deductions must be fair and reasonable. That is the way in which I hope the Bill will be amended in due course.

What is to be the form of the amendment? With respect to the noble Lord, Lord Wedderburn, the first amendment goes only a little way. It says nothing about fair and reasonable. It only has to be,

"reasonable in amount having regard to all the circumstances of the case".

That is only looking at the amount—whether £10 or £5 should be deducted. That is not looking at the terms of the contract, or the arrangements, and what has happened to the man—whether or not he has been careless. There is nothing in that amendment as to whether it is fair or reasonable. But the condition of fair and reasonable comes into the proposals of the noble Lord, Lord Rochester. The first paragraph of Amendment No. 70 states:

"The Code of Practice issued by the Secretary of State … shall have as its objective to ensure that any deductions from wages is fair and reasonable having regard to all the circumstances of the case".

That is just to my liking. As my noble friend Lord Rochester has said, there is an advantage with a code of practice that all these matters are not necessarily allowed to be dragged up in the courts. They may be small matters, so let them go if your please. They should not come under the strict and rigid rules of law. These matters should go before a tribunal which will consider the terms of the contract and whether they are fair and reasonable. It is for this reason that I favour a code of practice. Codes of practice are now widely recognised in law. They are very useful in dealing with cases where there is a mass of detail to be considered which, if I may say so, it would be quite inappropriate to consider in your Lordships' House. Let us consider the Highway Code. A person in charge of a vehicle has to exercise due care and attention but details such as when he is to keep to the right side of the road and when it is considered safe to overtake, and so on, are left to the code of practice. These matters should be dealt with by a tribunal and the code should be there for guidance. We have an industrial relations code which is concerned with whether a person has been properly or reasonably dismissed. It is recognised that decisions of this kind depend very much on the individual situation.

We should not put such details in a statute but in a code of practice. For example, in the Police and Criminal Evidence Act which was passed a year or so ago, the words of the statute are very difficult for people to understand. Even I fail to understand a lot of the statutes that we have now. The value of a code of practice is that it puts everything into simple words, so that the people who have to act according to the code of practice can read and understand it. At the moment I am afraid that in Clause 1 of the Bill as it now stands there is a great deal of detail. For example, subsection (5):

"Nothing in this section applies—

(a) to any deduction from a worker's wages made by his employer …

(b) to any deduction … or any payment received from a worker by his employer".

There is a great deal of detail already in the Bill.

When we come to the amendments of the noble Lords, Lord Wedderburn and Lord McCarthy, there are all sorts of other details, such as the proposal that a copy of the provisions should be presented by the employer when he makes any deduction, and so on. Many of these matters are very appropriate for a code of practice, but are much too detailed for your Lordships to have to consider time after time in Parliament.

On the whole, if there has to be a choice between Amendment No. 1 and Amendment No. 2., I should be against Amendment No. 1 and in favour of Amendment No. 2. However, if I may say so I am not sure but that the better course is for the Minister to take this point away and for him to bring back something which will give effect to the underlying principle, which is that in all the circumstances, whether under the contract or not, the deductions should be fair and reasonable—just as was provided for in the 1896 Act. I am against Amendment No. 1 and in favour of Amendment No. 2 on the whole.

We should perhaps remind ourselves that a major aim, perhaps even the main purpose, of this part of the Bill is to extend cashless pay. This was the basis of discussions between the TUC and a former Secretary of State for Employment. It is a purpose that I think should commend itself to the Committee and indeed to most people. It is right and proper to the extent that the Truck Acts are an impediment—and various inquiries have shown that they are only a minor impediment—to the extension of cashless pay in an orderly way.

This particular provision smuggles in behind or underneath the purpose of extending cashless pay a serious and indeed improper weakening of what was the original, definitive purpose of the Truck Acts, which was, in short, to stop unscrupulous employers from cheating their employees. It would indeed be a happy state of affairs had unscrupulous employers disappeared from the face of the earth, but I fear that it is not so. No doubt they are only a minority of employers but evidence has been put before Parliament that they are most certainly there. It would also be a happy state of affairs if alternatively the workpeople concerned had had the prescience, foresight and ability to organise themselves collectively in order to resist victimisation, oppression or cheating. But, as has already been said, the extent of trade union organisation, partly because of the nature of the trades and occupations, is very limited indeed.

It is therefore still incumbent upon this Committee to ensure that the conditions of working people are not made worse by their inability to resist an impost by their employer by incorporating within the legislation the degree of protection that is suggested in the amendment that is now before us. I find it odd that employers have a unilateral right in any event to impose fines upon their employees. If the employee is guilty of dishonesty, let him be sacked or prosecuted; if the employee is cheated by a third party—such as a motorist who drives away with a full tank of petrol—let the employer look to his management systems and supervision and not impose a penalty upon the employee, who may not have caused the original distress or damage.

Be that as it may, this Bill gives employers a great power which they can exercise against individuals who are weak, who are anxious for a job and who. as the noble and learned Lord, Lord Denning, has said, will sign almost anything in order to get work.

It is right that the tribunal, if it is to be a tribunal, should have at its disposal not only the powers that are expressed in the Bill but also the further power to ask whether what the employer has done is fair and reasonable. It should have the further power to search behind the narrow words—words of which perhaps the employee has repented, regretting that he had not had sufficient foresight—and to ask that question. The Government themselves have acknowledged the need for common sense to be operative in this context in that they have suggested that a figure of 10 per cent. should be applied in certain circumstances. We are not arguing about the level of the figure. The idea of the figure indicates that there must be some common sense and some application of shrewdness of judgment, in order to prevent the worst excesses. That is why I think we should incorporate some further protection within the legislation or, perhaps I should say more accurately, why we should preserve a protection which has historically been found to be necessary and for which, regrettably, time has not removed the need.

I am quite prepared to accept either the amendment of the noble Lord, Lord McCarthy, or the amendment of the noble Lord, Lord Rochester. I have listened to the different arguments and 1 am prepared to support either of the amendments, because I think it is thoroughly disgraceful that, as has been suggested, young people who do not have the means, the power or the strength to insist on fair play, can be taken advantage of. That is why I am prepared to support either of the amendments. I do not think it can be too strongly emphasised how thoroughly disgraceful it is if young people are being taken advantage of and how essential it is that it should be stopped.

I shall speak only to Amendment No. 1 which was moved by the noble Lord, Lord Wedderburn. Because I find myself basically in sympathy with it, I should like to say in answer to what I think was the only point of substance made in relation to the amendment by my noble friend Lord Campbell of Alloway that I cannot for a moment agree that consent by contract is a fiction in these filling-station cases. The amendment is designed to underpin the protection offered by the Bill to low-paid workers in what are in times of high unemployment very vulnerable jobs indeed. Whether the amendment goes far enough is one question, and I am mainly going to direct what I have to say to the question of whether there is a need here which the Bill does not rectify.

This is not a party political question. The Truck Act 1896 was introduced under a Conservative Administration, with general support, to meet the needs of its time. Now it limps. It is interesting to note that about a third of this Bill, and almost all of Part I of it, is devoted to re-legislating the 1896 Act in respect of deductions from wages. I see that as a clear indication that the problem of deductions, though it may have a different shape now, is just as much with us as it was at the turn of the century.

There is in my view a relatively widespread problem which this Bill does not tackle adequately. Once a provision allowing deductions from wages is in a contract of employment, no matter how unreasonable it may be, provided that the employer is alert to see that the modest requirements of the Bill have been complied with, there will be nothing that the county court, the magistrates' court or the industrial tribunal can do to protect the employee. There will be just the same abuses as were seen in 1896.

I should like to draw briefly on two examples of what actually happens, each taken from a recent decision of the Divisional Court. The judgment in the first—and that is the case of Mr. Barratt, to which the noble Lord, Lord Wedderburn, referred—was only four months ago. Perhaps I may mention that Mr. Barratt went to the stipendary magistrate and complained that his employers had unlawfully fined him. The stipendary found the case proved, fined the employers £250 and ordered them to pay costs and to repay to Mr. Barratt the deduction which had been made, amounting to £75.90.

Under the Bill the making of wrongful deductions is to be decriminalised. It is only necessary to pause to consider for a moment the size of the fine in this case compared with the amount of the deductions to see that one strong deterrent to the making of wrongful deductions is to go with the repeal of the 1896 Act.

I would also point out to the Committee that on the facts of the case Mr. Barratt worked for only three weeks at the filling station. His net wages were to have been £55·90 a week. In one week he lost £20; in another he lost the lot. Mr. Barratt was lucky. What the court found in his case was that his employers had wrongly imposed a fine on him and so they put themselves outside the Act. They had not taken his money by way of compensation for their loss, which might have been legitimate as between an employer and an arguably negligent employee. The Divisional Court decided that as a fine it was not a fair and reasonable one.

The second case, also a filling-station case in the Divisional Court, was decided a year ago. A Mr. Bristow was a cashier. He, like Mr. Barratt, was 18 years old. In what seems to have been a written contract of employment there was this provision:

"Every site employee, together with other site staff working with him, if any, is responsible for all cash shortages that may occur in the cash till that he is using. He will, therefore, undertake to make good to the company either all or his share of the total shortages on every shift that he works, either immediately or by deduction from any wages outstanding".

That made the employee liable for cash deficiencies, and he signed a separate acceptance of responsibility in respect of stock deficiencies.

In that case the intention of the employers was that Mr. Bristow should be legally liable, irrespective of whether he or indeed any other employee was culpable, for a share of all loss of cash and stock. In the five weeks of his employment in 1983 there was deducted from his pay packet an average of 17 per cent. of what should have been his weekly net wage.

Mr. Bristow failed both before the magistrates at Brentford and in the Divisional Court because he could not show in his case that the deductions were fines and so covered by the Act. He could only proceed under Section 1 of the Truck Act 1896, which deals with fines, because he was not under that Act a workman; he was a shop assistant and shop assistants are protected only by Section 1 of the Act. That is one of the fine but outdated distinctions in the Act which are to be eliminated with this Bill's passage into law.

What seems to me to be common to both cases is that the deductions were unreasonable, but if the Bill is passed unamended it would be possible for unscrupulous employers to continue to make those unreasonable deductions. Both Barratt and Bristow were 18 years old. What sort of introduction to employment was that, and what sort of first-job experience was it?

The amendment proposed by the noble Lord is a modest one. I wonder whether it could not be widened to provide, in effect, that all contractual provisions for deductions must be fair and reasonable and not just that the deductions made under the provisions must be fair and reasonable. Might it not be better to influence employers to write fair contracts in the first instance, rather than to leave it to employees to find out that unfair contracts are unenforceable?

I hope that my noble friend will think again about this clause in the Bill and perhaps come back at a later stage with something to meet what seem to be the general feelings of the Committee today.

It may help if I briefly explain the philosophy of the controls on deductions from wages in Part I of the Bill. The Government conducted a consultation exercise in 1984 on controls on deductions from wages that should be established if the Truck Acts were to be repealed. The results suggested that there is no major problem that workers are currently experiencing in the field of deductions from wages other than in the limited area of deductions concerning cash shortages and stock deficiencies. The Bill provides for general controls on deductions from wages that, broadly, allow the parties to agree their own terms, but then ensures the employer sticks to the terms. It provides for special controls in Clauses 2 and 3 on deductions to cover shortages.

It is quite reasonable that employers will make in some circumstances disciplinary deductions from wages as a sanction for breaches of discipline that do not merit dismissal. If such deductions were entirely prohibited employers might more readily resort to dismissal. The philosophy of the Bill is to let employers and workers sort out rules governing such deductions in the contract. But Clause 1(3) ensures that the worker knows what the rules are; Clause 1(4) ensures that the rules cannot be changed retrospectively by the employer to allow a deduction in respect of events that are past; and Clause 5 ensures that the workers can enforce the rules before an industrial tribunal. I believe that these are fair and reasonable provisions.

I recognise that the amendments moved by the noble Lord, Lord McCarthy, and his noble friend are inspired by a desire to reinstate certain words in the Truck Act 1896 concerning reasonableness. It is proposed that deductions from wages or payments by workers to employers should be reasonable in amount, having regard to all the circumstances of the case. But the fundamental difficulty with a requirement that deductions be "reasonable" is that what is reasonable is a matter of opinion. Employers and workers would just not know where they stand if these amendments were accepted.

If we say in the statute that deductions must be "reasonable" the employer will never know if a deduction is lawful until he has had its lawfulness tested before an industrial tribunal. In practice, employers may simply not take the risk of having to waste a morning arguing the case before an industrial tribunal and simply punish breaches of discipline by dismissal. Surely it is enough simply to say that the terms of the basis on which the parties are prepared to go on offering and accepting employment are reasonable terms.

One must also recognise that the more we tie up people with statutory requirements which they must follow in deciding whether to offer and accept employment, the more likely it is that we shall deter would-be employers from offering employment at all.

Not again.

With regret, I think that the practical effect of the amendments, however well-intentioned, would be to increase the number of dismissals, leave employers in an impossibly uncertain position and reduce the number of jobs on offer. I noticed considerable derision when I made that observation a moment ago. I wonder how many noble Lords opposite have been in the position, as I have, of being a small employer and being genuinely concerned about the bureaucracy that is attached to taking on new employees. It is a deterrent. Noble Lords opposite should not lose sight of that.

May I turn to the proposal for a code of practice? My noble friend the Secretary of State has considered closely whether it would be appropriate for him to issue guidance on good practice in drawing up contractual terms concerning deductions. On balance, he thinks that it would not. However, I can assure the Committee that the Department of Employment will issue guidance on the law before Part I comes into operation.

It is possible that a number of independent organisations such as the Institute of Personal Management or ACAS may wish to produce some guidance on good practice in framing contractual terms of deductions. ACAS is aware of the point which was raised during earlier stages of the Bill, but ACAS is an independent body governed by a council that includes TUC and CBI representatives. It is not an instrument of the Department of Employment. It would not be appropriate for Ministers to seek to direct ACAS in any way, but the ACAS council will doubtless consider the call for a code.

The noble Lord, Lord Wedderburn, and my noble friend Lord Coleraine referred to the case of Sealand Petroleum Company Ltd. v. Barratt. That case demonstrates, if I may say so, that a High Court case was required to determine whether the 1896 Act protected the employee. I believe that supports the proposition that the 1896 Act, after 90 years, is uncertain and therefore largely ineffective.

A number of questions have been asked about the concept of "reasonableness". I shall perhaps help the Committee with an example. Suppose that an employer is faced with a worker who has breached a safety regulation, perhaps putting other workers at risk. The employer does not wish to dismiss him and the contract says that workers can be fined for such breaches. Suppose that the employer fines the worker £10. Is that lawful? With the amendments, the employer does not know until he comes before an industrial tribunal. He spends a day arguing his case and is told that £5 was perhaps reasonable but not £10, or perhaps £10 but not £15. The employer just does not know where he stands. I have said that the Truck Acts have caused considerable confusion on that issue. At an earlier stage the noble and learned Lord, Lord Denning, was right to describe them as ineffective. They are a poor model.

I hope that those difficulties will have persuaded the Committee that we should not proceed in the way suggested in the amendments. I hope that the amendment will not be pressed.

It is a novel experience for me to hear, albeit from the noble and learned Lord, Lord Denning, that I am not going far enough, but I take his point. After consultation, my noble friends and I have come to certain conclusions. I shall say just two or three things about the arguments against our amendment. The noble Lord, Lord Trefgarne, speaking for the Government produced some astonishment. Every time there appears in this Chamber any Bill that has anything to do with the protection of workers, we are told that it must be bad because it will stop recruitment into jobs. There is no evidence of that in relation to matters which have come before us recently, any more than there is that jobs will be promoted by the Government's plan to charge workers £25 for going to an industrial tribunal which is contained in their latest policy document.

The noble Lord fell into another error which must be faced. He said that the amendment rests upon "reasonableness"; that what is reasonable is a matter of opinion; that no one would know where they stood and therefore we should not have such a law. Many laws stand on "reasonableness". On the noble Lord's reasoning we should never have had a law on unfair dismissal. I am not sure that the Government want an unfair dismissal law. No doubt if they come to repeal it, that is the argument that they will use. It is a poor argument, because many parts of our law depend on what is reasonable. The Factory Acts, which the noble Lord cited frequently, depend upon the employer doing what is reasonable or what is different but perhaps more difficult, that which is reasonably practicable. No one suggests that we should repeal the Factory Acts because they include such formulae.

I do not hold such a low opinion of British employers, be they small or large, that I believe that they would not know in the vast majority of cases when a fine on a worker was reasonable and when it was unreasonable. I do not believe that. I do not believe that the noble Lord, Lord Trefgarne, when he was a small employer, would not have known in the vast majority of cases when he went home at night whether he had treated someone unfairly.

The noble Lord, Lord Coleraine, rightly took us to two cases. I did not cite the Bristow case because it seemed to me more concerned with the definition and interpretation of what is a fine, which does not appear in our formulation. We have had cases in the courts because petrol companies have gone in for scandalous practices. In 1896 the Home Secretary, replying to a debate on the Bill, said on 4th May at col. 523 of Hansard that he did not apprehend any vexatious litigation over the expression "fair and reasonable". He felt sure that one or two decisions by the courts of law would settle the meaning of that expression. In this context he was right. It is only when employers in this area have gone for such outrageous practices that cases have gone to the courts.

There has been a wages inspectorate. Although we all criticise it, over the years it has also maintained standards on the basis of a test of reasonableness. The noble Lord, Lord Campbell, spoke to other amendments. I shall reserve my comments until we come to those amendments. I must put one matter right in case it was my slip of the tongue rather than his mishearing. I hope that I did not say that all consent for workers by way of contract was a fiction. I hope I said that the groups of workers with whom we are dealing, the formal contract is more in the nature of a submission than of real consent. The noble and learned Lord, Lord Denning, gave other illustrations of when that is so.

If the noble Lord, Lord Campbell, will look at the report of bodies such as the Citizens Advice Bureaux he will find hundreds of cases described. They are not all by any means in retail shops or petrol stations. There are hundreds of cases with questionable deduction clauses in workers' contracts. As the North Warwickshire Citizens Advice Bureau put it, they are individuals who are desperate for employment, only too eager to sign the contract and only later when the deductions affect their living standards and their families do they fully realise the consequences. That is the reality of today. Those are the workers for whom we are worried.

My noble friends and I are not concerned about the precise order of the amendments on the Marshalled List, but we are interested in workers in stock rooms, store rooms, petrol stations, shops and driving jobs who suffer those practices and whose families suffer them. If there be a sense in the Committee that the first amendment is in some ways too mild and insufficiently full, or not quite right, we shall not press the matter as there may be a better solution.

I understand that Amendment No. 2 will be pressed. As I read it, it demands that deductions must be in accordance with the standards of the code of practice. That is to say, the code of practice will not be merely a document suspended in some judicial levitation above employment practices but will be there, right in the middle. Its standards must be observed. It is possible that this is something that some Members of the Committee prefer. Because my noble friends and myself regard it as so important to establish the broad principle and because the two amendments, it seems to me, are very much at one, I beg leave, on the understanding that we can go into the Lobby on Amendment No. 2, to withdraw this amendment.

moved Amendment No. 2:

Before the noble Lord decides what to do with his amendment, he has, I believe, slightly misunderstood what I said during my remarks. I was not in the least intending to be unreceptive to the proposal that he made. I said that the Department of Employment would be issuing guidance before Part I of the Bill became law. I pointed to at least two bodies that might wish to prepare a code of practice that would further assist employers and employees operating the provisions of this measure. I am not sure how much further the noble Lord wants me to go. If it helps him, I would be happy to agree to look again at the possibility of my noble friend preparing a code of practice of his own which I believe would go some way to meeting the noble Lord's concern.

I thank the noble Lord for what he said. I thought that I had made plain at an earlier stage that we are anxious—I believe that I speak for most, perhaps all, noble Lords on this side of the Committee and for a number on the other side—that something should be written into the Bill upholding the principle that has been enunciated this afternoon. I wish both to move and to press the amendment.

My Lords, I think that it would be appropriate at this moment to take the Statement. Therefore, I beg to move that this House do now resume.

My Lords, with the leave of the House, I shall now repeat a Statement made in another place by my right honourable and learned friend the Secretary of State for Scotland. The Statement is as follows:

"With permission, Mr. Speaker, I should like to make a Statement on the control on the movement and slaughter of sheep in Scotland.

The results of tests on sheep in slaughterhouses in Scotland, the latest findings from which were published yesterday, give no cause for concern. We now have results of tests on young lambs in Scotland. These results are being published today.

"Generally they are satisfactory. No readings have been obtained comparable to the highest in North Wales and Cumbria, but there are five readings over 1,000 Bq/kg for caesium 134 and caesium 137 together, which is the limit at which by international recommendation action should be considered. One of these readings, the lowest of the five, comes from Easter Ross and, at 1,017 Bq/kg, is within the margin of sampling error. Three of the other readings were found in Dumfries and Galloway, including the highest at 1,272 Bq/kg, and the remaining reading is from Arran.

"The animals tested were only two to three months old and will not be ready for market for some weeks yet, by which time the level of radioactivity may be expected to have declined well below the 1,000 Bq/kg level. I can say categorically therefore that there is no danger to public health and no reason for consumers to refrain from purchasing and eating lamb.

"It is Government policy to insist on the highest levels of safety, and, in order to keep under supervision lambs in those areas of Scotland where relatively high levels of radioactivity have been identified, I have made an order which will be laid before Parliament to come into effect today to prohibit for the next 21 days the movement and slaughter of sheep within Dumfries and Galloway, Arran and Easter Ross.

"Monitoring in these and other areas will continue and the restrictions will be reduced or removed as soon as testing confirms the expected fall in levels.

"I recognise that these measures may cause some interference with the marketing plans of some farmers in the areas concerned. I am sure they will understand why this action is being taken and in this connection I must pay tribute to the responsible and co-operative attitude shown by the National Farmers' Union of Scotland. If it should prove necessary, the Government will be prepared to discuss cases of compensation for severe loss in particular circumstances to specific farmers."

My Lords, that concludes the Statement.

My Lords, there is not much that one can say which was not said on Friday when the Statement on Wales and Cumbria was made. However, I think that the importance of letting the public know what is happening should be re-emphasised, and the noble Viscount has done so, because there were some considerable scare stories in the press last Saturday morning. However, this is a difficult task to carry out, and I understand that there has already been a drop in the price of lamb. My own wife's reaction is that she will not buy lamb unless it is New Zealand lamb. This has a rolling effect which is seen in the fact that lamb prices have come down, in spite of the fact that many of these lambs are not yet of marketable size, although in 21 days they can come a long way.

I should like to ask the Minister why, only three days after the Statement on Friday, we have this Statement. I hope that the Government have not been sitting on these reports because it is rather important that farmers should know all along the line what is going on. I hope that that is not the case here.

The matter of compensation will be very important because all the areas which have been mentioned, apart from Easter Ross, almost entirely rely on at least the next two months for the sale of store and fat lambs for their total income for the year. Therefore, it is very important indeed that this matter should be looked into very carefully and that we be ready to give help when it is required.

On several previous occasions when compensation has been paid, the matter has dragged on for a long time and farmers have had to wait for their money. I re-emphasise that these are areas where the farmers' income comes solely from sheep and if we have another Statement from the Government, it will be very serious for them. I hope that the Minister can assure us that there will not be another Statement in the near future because that would give rise to a very serious situation as it would begin to cover all the lamb-producing areas in the country.

My Lords, it is obvious that in circumstances of this kind the Government, in the public interest, must err on the side of caution, and this the Government have done. Would the noble Viscount confirm that there is strict monitoring going on, and that in fact the lambs in this and the surrounding areas will be tested again to reassure the public, and that the results will be published as soon as it is done?

With regard to the question of compensation, these are innocent farmers, very often with one cash crop in the year, and that is lamb. The words used in this Statement in respect of compensation might cause considerable alarm. It is clear that this interference with the normal marketing process will cause loss to farmers. For example, if lambs are kept back for three weeks they put on excessive fat and will not grade properly.

The words used in the Statement are:

"If it should prove necessary the Government will be prepared to discuss cases of compensation for severe loss".

Should not the Government compensate for any loss? Why should it be confined to particular circumstances with specific farmers? If fanners as a result of these actions are going to suffer loss, surely the Government should compensate, and look to the Soviet Union for compensation nationally? Would the noble Viscount not agree with that?

My Lords, I am grateful to both the noble Lord, Lord John-Mackie, and the noble Lord, Lord Hooson, for their reception of this Statement. In general, I would agree with the noble Lord, Lord John-Mackie, that this problem was discussed at length on Friday when my noble friend Lord Belstead repeated a Statement made in another place by my right honourable friend the Minister of Agriculture, Fisheries and Food.

I do not think that I can add much to what my noble friend then said. But on certain specific points, the noble Lord, Lord John-Mackie, asked why was the order not laid last Friday. We said then that we would act on the basis of monitoring data, and that is what we have done. Following on the monitoring topic, I would assure the noble Lord, Lord Hooson, that we are keeping monitoring on a continuous basis and will publish the results.

The noble Lord, Lord John-Mackie, raised the subject of consumption. If it is any help, perhaps I may just give him a scientific answer from my brief and not from my brain. At 1,000 Becquerels per kilogram of total caesium, which is caesium 137 plus caesium 134, the total does in a year to the average consumer, assuming he eats meat at the average consumption rate throughout the year of five kilograms, would be 0·15 millisieverts. This compares with an annual does from natural sources of 2 millisieverts, to which we are all subjected. Therefore, there is no danger whatsoever.

On the question of compensation, which both the noble Lord, Lord John-Mackie, and the noble Lord, Lord Hooson, raised, I take note of what they said. This is always a difficult problem in these matters. Our intention is that any distruption will be minimal disruption, and the position on compensation was spelt out by my right honourable friend the Minister of Agricuture. If it should prove necessary, the Government will be prepared to discuss cases of compensation for severe loss in particular circumstances to specific farmers, and more than that I cannot say at the moment.

My Lords, could my noble friend say why sheep only? Are we monitoring the position as regards fat cattle? Certainly in Easter Ross some fat cattle will be coming forward for slaughter in the near future. Can my noble friend say a word on the position of monitoring of cattle?

My Lords, the monitoring results so far—and there has been monitoring for cattle as well—show that there is no cause for concern withother food products at the moment. The point is that he young lambs have been feeding on the contaminated pastures and have been ingesting a great amount of food, and that is why they have been particularly susceptible to risk.

My Lords, am I right in thinking that the Government took action as soon as they received the information in respect of the recent analysis? But it is rather obscure to say that there is no cause for concern. There may be no cause for concern to the consumer; but there is considerable cause for concern to the farmer, especially when the noble Viscount suggests that there may be some disruption of the market.

You cannot have a policy of restricting movement and no slaughter without seriously restricting the market for those hill sheep farmers affected. What percentage of the stock of sheep in Scotland is held in Arran? It is not very high, I would fancy. But when you think of Dumfries and Galloway particularly, and Easter Ross, it must be getting well on to 15 per cent. of the whole stock. That is a considerable disruption.

Can the noble Viscount tell me one other thing? When he talked about a restriction on movement and slaughter, is this absolute? Is there to be no movement at all even within an area? Can he give us any indication of what is going to be the basis of compensation when that is dealt with? Compensation will be needed, and needed speedily when we are dealing with what is an acceptable—and readily acceptable—cash crop for farmers who are going to be denied it, having had a fairly rough winter already.

My Lords, in reply to the noble Lord, Lord Ross of Marnock, I do not have the figures of the number of sheep affected. On the effect of the order, in Dumfries and Galloway it forbids for a period of 21 days, beginning on 24th June, the movement of sheep off farms and the slaughter of sheep except with the consent of the department. Slaughter will be permitted for welfare reasons, and this is already provided for in the order, on condition that the meat does not …. There is no end to that sentence. I apologise for the fact that my noble friend the Minister of State is in Inverness today. I am afraid I forget the noble Lord's other question. Perhaps he would remind me.

My Lords, I asked about the stock, and whether there was an absolute bar on the movement and slaughter of stock, and I gather that there is not provided something or other that we do not know about, and that the Minister has not been adequately briefed about. I asked about the effect of compensation. There has already been a loss and a drop in price. It may not affect just these areas. It may be general through all the lamb and store lamb markets at the present time. The other question was about the basis of compensation, and whether it will be paid quickly.

My Lords, I understand. What I meant to say earlier when I was talking about no cause for concern was that I was talking about the consumer. There is of course considerable cause for concern for the farmers affected here. I am certain that my right honourable friend will bear that in mind and do his best to assess and pay the compensation to those who have really suffered from this tragedy.

My Lords, if the Government find it necessary to pay compensation in respect of Scotland, Cumbria, or of Wales, will they seek reimbursement of the cost of that from the Government of the USSR in view of the fact that the whole problem has been created by a failure in the industrial system of that country?

My Lords, I think all I can say to my noble friend is that I shall pass on his question to my right honourable friend.

My Lords, may I ask the noble Viscount to tell me whether the monitoring of cattle, to which he referred, includes the monitoring of milk, and if so, with what results?

My Lords, I am sorry but I do not have the answer with me.

My Lords, while I agree with what my noble friend Lord Ross of Marnock has said about the producer, may I ask whether the noble Viscount is aware that it will ease public concern considerably if he makes it clear that within the 21 days referred to in the Statement the amount of caesium in the lambs will have reduced sufficiently to make it safe to slaughter and to eat the lamb? That is the point in the public mind that has not been made clear. If he can say that today, it will be of considerable benefit.

My Lords, I can state categori-cally that that is what we are expecting to happen; that the amount of caesium will be reduced over the next 21 days.

My Lords, may I ask the noble Viscount about another point which might worry farmers? If the price comes down I hope the Government will not rely on the variable premium to make it up. There is a limit to the variable premium and it would not make up a loss of 25 per cent., which is the figure stated. I do not know how accurate that figure is, but it has been quoted in some of the reliable press. That is something that must be carefully watched: the Government, who are pretty good at this kind of thing, relying on the variable premium, which I do not think they can do in this case.

My Lords, I am grateful to the noble Lord, Lord John-Mackie. I shall certainly draw his remarks to the attention of my right honourable friend.

moved Amendment No. 3:

Before I put the Question, I should explain, as the noble Lord was speaking to Amendment No. 4, that if Amendment No. 4 were agreed to it would pre-empt Amendments Nos. 5 and 6 so that I should not be able to call them as well.

As the noble Lord has explained, the amendments restructure Clause 1(1), which provides that the basic protection for workers that deductions from wages (or payments by a worker to his employer) are unlawful unless provided for in a statutory provision—for example income tax—in the contract or by the written consent of the worker.

Incidentally, I believe that Amendments Nos. 10 and 11 come within this group as well. I notice that the noble Lord, Lord McCarthy, nodding in assent.

The effect of these amendments would be to remove written agreement as a method of authorising a deduction or payment. But it would create great difficulties both for employers and workers if the route of authorising a deduction by the written agreement of the worker was closed. For example, a set of deductions to recover a loan to purchase a season ticket could then only be authorised by varying the contract, which would be a needlessly cumbersome method of achieving a result desired by both parties. But in so far as the method of varying the contract was by the agreement of the worker the steps involved would amount to much the same thing except that agreement would not necessarily be in writing—so the standard of protection of the worker would, I think, be reduced.

I hope that in the light of these two difficulties the noble Lord will not wish to press his amendment.

I am grateful to the Minister for that explanation. It is one that I followed in one respect, namely that if the effect of the amendments was to reduce the protection of the worker we certainly should not wish to move it. But, in a phrase, the objective and effect of the amendments—I apologise to the Committee and to the Minister because Amendments Nos. 10 and 11 on the new numbering are those we agreed should be considered as they involve the same thing—would not be to remove written agreement from the Bill. Written agreement is presumably contractual. It is intending that the parties should be bound. If I have a contract of employment and a document is put before me saying "Here is £100 as a loan to buy your season ticket. Will you agree to that being deducted from your wages?" and I accept, whether by signature or otherwise—that is a point we are coming to—then it is difficult to understand how that does not vary the relationship: my consideration being my going on working on those terms and the employer's being employing me on those varied terms. That is a variation of the contract of employment. I could imagine very bizarre documents that would not be, but the noble Lord the Minister did not put any of those to us. I am still mystified.

This is an important matter and not just a technical one. It is not a technical matter because if the Bill stays in this state it will suggest to employers and their advisers that there is an important category of writing which can be the foundation of lawful deductions which, because it is in paragraph (b) is not necessarily contractual and not a variation of the contract, not within the contractual sphere. The example that the Minister gave, a loan to purchase a season ticket with a written agreement to repay by deduction, is plainly a variation of the contract of employment. So the only possibility it would seem to me, with respect, would be agreements which are collateral to the contract of employment. That is what I expected the Minister to say. If this is aimed at contracts which are collateral to the contract of employment then Clause 1(1)(b) assumes quite a serious area of danger and problem because then it can go outside the employment relationship in new ways. For the moment, hoping that the Government will be able to say something a little clearer on what are the writings which are not contractual and come within paragraph (b) and do not come within paragraph (a) when we come to the point once again on Report, I beg leave to withdraw the amendment.

moved Amendment No. 5:

Both these amendments seek to change the provision in Clause 1(1) that a deduction is authorised if the worker,

"has previously signified in writing his agreement or consent to the making of it".

Amendment No. 5 requires that the worker has signified his agreement "to the employer". But the employer could not make a deduction authorised by this provision unless he knew that the worker has signified his consent. So the worker must in practice signify consent to the employer or to a third party, but at the same time informing the employer of this consent, which surely amounts to the same thing. If the worker gave consent to a third party but neglected to inform the employer, the employer obviously could not make a deduction authorised by such a consent. I assure the Committee that the additional words in Amendment No. 5 add nothing in that context of practical value.

Amendment No. 6 requires the worker to sign the agreement or consent he has given in writing. But the clause already requires the worker to give his consent in writing, which means that the worker must write a consent or sign a consent written by someone else. I see no reason to say that a consent written out by the worker but not signed is not a valid consent, and the more complicated we make these provisions, the more Likely it is that an employer will trip up on a small technicality and find himself having to repay to the worker a perfectly justifiable deduction from wages. I believe that these amendments add nothing and, arguably, create a rather confused Subsection. I hope that the noble Lord will not press them.

Sometimes I think it difficult to make these subsections rather more confused than they are, but no doubt if we have achieved that, it has not been a very good step to take. The noble Lord the Minister's objection to the amendments seems to be that they change the provisions of the Bill. That, of course, is the objective of amendments to a Bill. Let us take the two examples that he gave, because they are important. He said —and I follow him a long way—that the agreement must be signified in such a way that the employer knows about it. So it can either be signified to the employer or to a third party and, so long as the employer knows about it, then that is good enough. Well, if the employee does not inform the employer, that he says, would create a problem.

But let us suppose that the third party then informed the employer. The Minister's example has to have added to it the rider that if a third party informed the employer then, on his hypothesis, that would satisfy paragraph (b). How uncertain! The noble Lord the Minister ended up by saying that in practice therefore it would be all right. Every time you hear the draftsman of a clause say, "Oh, in practice, it will be all right", you can be sure that there is something wrong with the clause. No one should ever have to defend a clause with the words, "If it is not right on paper, it will be all right in practice". A clause should be clear, a clause should cut out all possible—it cannot ever cut out all—predictable uncertainties. And there are two here.

The first the noble Lord did not meet—except merely to say that it would be all right in practice. As for the second, the noble Lord the Minister says that the worker must sign a document drawn up by someone else—I accept that—or draw up his own document which he need not sign. Why not? Why not say that it should be signed? Then everyone would know where they stand. For example, we have a document drawn up by, say, a noble Lord. I say, "This is your document". He says, "But I haven't signed it. It's not my handwriting". An element of uncertainty immediately appears.

I understand the point that the noble Lord is trying to make. I think it will generally be a matter of fact whether or not the employee actually wrote out the document concerned, if he did not sign it. It would be presumed generally in such circumstances—and I guess that they will be pretty unusual ones—that he had written it out in the presence of his employer who therefore knew that it was his document and that he was thereby assenting to the actions to which this provision applied. I understand the anxiety in the noble Lord's mind on this matter. If the noble Lord will allow me, perhaps I may look into this a little further, particularly in the context of a document which the employee has written out himself, to see whether there is any way in which I can meet the noble Lord's anxiety.

I am glad to have that qualified assurance, as perhaps I should call it, from the noble Lord the Minister and on that basis I beg leave to withdraw the amendment.

moved Amendment No. 8:

The effect of this Amendment, No. 8, will be to add a further restriction on contractual or agreed deductions or payments. It would ban deductions that are not made by reason of dishonesty, default or other misconduct on the part of the worker. This would ban a great many perfectly reasonable deductions: for example, to recover loans or to pay subscriptions to a company's social club.

Under the Bill as it stands, the worker can be made to compensate the employer for a loss or shortage only if the worker has a contractual responsibility for the loss or shortage; that is, if his contract makes clear that he can be asked to compensate the employer for the loss or shortage. This is clear law and it is reasonable that the parties should agree their own rules in the contract, and stick to them. It is quite reasonable that where a worker has accepted a contractual responsibility for losses or for the cash that is the lifeline of the business, he should meet such loses or shortages.

The Government have considered these amendments carefully but we have concluded that they would lead to uncertainty and complexity and would possibly cost jobs. The amendments would require the employer to seek to determine responsibility in fact for losses and shortages, rather than simply agreeing with the worker to make a deduction and drawing a line under the matter. This might make the employer, faced with continuing unexplained shortages that he had to meet as he could not prove dishonesty, more likely simply to dismiss the worker concerned.

The amendments would lead to complex and lengthy tribunal cases, investigating who was in fact responsible for particular losses or shortages. The more we complicate the Bill with statutory constraints on the ability of employers to offer and workers to accept jobs on terms they can agree, the more likely it is that the number of jobs on offer will be reduced. I ask the Committee to accept that, however well-intentioned, the amendments could lead to complex-ity in law and to the loss of jobs.

I have some sympathy with this amendment. There is a widely-held view that any deductions for cash or stock deficiencies are outmoded and should be replaced by better management and better methods of control. I think that was one of the points that the noble Lord, Lord Stoddart of Swindon, was making. My fear is that incompetent management may seek to hide that incompetence at the expense of the employees. Under the Bill it is possible for poor management to make deductions from wages rather than carrying out sound practices such as, for example, moving employees thought to be responsible for deficiencies in cash or stock from one shift to another. Our aim in the long term should surely be to get employers to accept that it is their responsibility to establish procedures under which their employees are protected from what may be the misdeeds of others, rather than taking refuge in penalising people who may not themselves be at fault.

I am in a difficulty here because, as I have already indicated in the general discussion on the first two amendments, I am not happy, any more than is the Minister, about doing something (except in the most exceptional circumstances) which violates, as it were, the contract between the employer and the employee. I rather hope that in those circumstances this particular amendment will not be pressed but that the thought which underlies it may perhaps be introduced at some later stage when I may find it easier to support it.

I am afraid that I do not support the amendment. It is not wise to put rigid rules such as this into the statute itself. As I indicated earlier, it is really much better for there to be a code of practice or code of guidance so that the matter may be considered as to what is fair and reasonable in all the circumstances. I hope the tribunal will be sufficiently interested and have wide enough powers to decide what is fair and reasonable. I would not hamper it by having through-out this Bill rigid rules laid down for it, or for the employer, to operate on.

Very briefly, may I say that I would not wish it to be assumed that silence on these Benches implies, in any sense, acceptance of the statements or unsupported assertions made by the Minister; for example, the reiteration of the assertion that this measure is designed to produce jobs. There is not a shred of evidence that measures of this kind defend jobs. If his argument is that this measure is necessary to defend the job of a defaulter who other-wise might be taken to a tribunal, the answer is that if there is dishonesty his job should be at stake. If there is alleged dishonesty, he should have the right to go to a tribunal and defend himself there. I make the point merely because, if the Minister repeats something many times, that does not mean that we are accepting the basis of his argument.

What the Minister said is borne out every day with people who have to run businesses, particularly small businesses. When one is thinking of opening a department in another town, particularly when people have to handle money and one has to pay for the stock which is to be put into the shop, one must be satisfied with the people who will be handling money without day-to-day supervision, because one cannot always transfer top, responsible management to a new department in another town. The employer must feel that he has some sanction which will ensure that the business is being properly run, as regards the cash that comes over the counter.

The arrangement that you come to, perfectly properly, is that if the money taken does not conform with the normal percentages of the other branches, and if there are no circumstances which make that new branch different from the others, the employee knows that he will be responsible for any discrepancies that cannot be accounted for. That makes him that much more efficient. If you do not have that sanction, you think twice about risking your capital in the stock, in the rent and in all the other things that go with opening up new premises. That is common form.

I am interested, too, in a group of hotels where people are in charge of various departments and cash is coming in. If the money taken at the door for a dance, where there is no real check other than the tickets that have been handed in, is short somebody is responsible for the discrepancy. The people who take on that responsibility know that and they are that much more keen to see that the takings at the door conform with the tickets. If there are special circumstances, such as rowdyism, an employer takes that into account.

However, I do not think there is any need for the state to come in on this. There is no need for a statute, which means all kinds of pettifogging forms having to be filled in and procedures having to be followed. The Minister is absolutely right. I have great respect for the noble Lord who has just spoken as a trade union leader. He knows his men and it is right that he should want to defend them from any kind of interference by anybody. But I am on the other side of the counter and I know that, before you take a risk and put in investments, you want certain protections. This is a very sensible one which you enter into with the employee concerned. If it is not there, it will interfere with your decision as to whether you open a department, and therefore it will interfere with the employment of certain people.

It has been an interesting short debate. I think I can understand the reservations of the noble and learned Lord, Lord Denning, and the noble Lord, Lord Rochester. I understand their preference for the insertion of what is fair and reasonable and a code of practice. We had the opportunity to vote for just those things, but unfortunately the Committee in its wisdom or otherwise decided that it could not agree to that. Had it done so, this amendment would have been completely unnecessary and we should have certainly withdrawn it. But I understand those reservations and, in any event, I shall probably not press the amendment.

The noble Lord, Lord Harmar-Nicholls, seems to think that employers in the retail trade, and in other such trades, should have this sanction of fining their workers, because that is what it amounts to—

No.

Yes, indeed. Just listen for a minute. He is proposing that there should be a sanction in those trades of a fine to be placed on the workers quite indiscriminately in respect of defalcations, shortages in the till or shortages of stock. That is what he said. I was listening to him very closely.

The noble Lord's interpretation of what I said bears no relation at all to the words that I used. What I said—and I repeat it—was that I believe that a contract made between the employer and the employee is all that is necessary. They both agree that, in order to get the efficiency that they both need, they are prepared to pay for discrepancies which common sense shows are there. There is no question of fining anybody. The kind of interpretation which the noble Lord put on it shows the bias with which he approaches this question: that the employee can never be wrong but that there are dirty employers who always want to be wrong. That is the wrong attitude here and the noble Lord reflects it far too often. But he must not reflect it by misinterpreting my words.

On the question of bias, I think that it is a case of the pot calling the kettle black. The noble Lord is very well known for his bias in many respects, and for his forthright speaking in the House of Lords, which is particularly what we want. I understood perfectly what he said about the contract of employment, but I thought I explained earlier the difficulties that a worker may very well be in when he signs that contract of employment. He is at that moment perhaps starting a job without knowing what it entails, or he may be applying for a job but before he can get it he will have to sign the contract. Therefore he is in a weak position, at that point in time, in relation to his employer. That is what I was getting at, and in those circumstances it is wrong. It militates against the interests of the employee, and in favour of the employer, if he is under that contract subject to being fined for defalcations and shortages which may not be his own fault.

The noble Lord asks: who is going to start a small business or department in those circumstances? Marks and Spencer did and they employed workers under the protection of the Truck Acts. Today, Marks and Spencer see no reason to fine their employees for shortages and what have you. The reason they do not is that they manage their business properly and ensure that there is proper control, both of cash and of stock. It is made clear to their workers that any of them who are found to be dishonest will no longer be welcome to be employed by Marks and Spencer.

Although the noble Lord the Minister said that condoning dishonesty by punishing collectively is better than the sack, from the point of view of the business and from the point of view of his fellow workers it is much better that a dishonest worker should be sacked. It is a protection for the employer and it is a protection for the other people who are employed. That is the way to run a business. I therefore think that the noble Lord, in suggesting and bringing up this question of dismissal, is guilty of perhaps misleading himself and by misleading himself is misleading the Committee. As I said, I do not intend to press this amendment at this stage, but I hope that the noble Lord, Lord Trefgarne, will ensure that the debate which has been a short but interesting one is well read in the department. It may well be that we shall come back to this matter on Report. I beg leave to withdraw the amendment.

moved Amendment No. 12:

Under the Bill as it stands a worker can be made to compensate the employer for a loss or shortage only if the worker has a contractual responsibility for the loss or shortage (for example, his contract makes clear that he can be asked to compensate the employer for that loss or shortage). This is clear law and it is reasonable that the parties should agree their own rules in the contract and stick to them. It is quite reasonable that where a worker has accepted a contractual responsibility for losses, or for the cash that is the lifeline of the business, he should meet such losses or shortages.

We have considered this amendment very carefully but have concluded that it would lead to uncertainty and complexity. The amendment would require the employer to seek to determine responsibility in fact for losses and shortages rather than simply agreeing with the worker to make a deduction and drawing a line under the matter. This might make the employer, faced with continuing unexplained shortages that he had to meet as he could not prove dishonesty, more likely simply to dismiss the worker concerned. The amendment would lead to complex and lengthy tribunal cases investigating who was in fact responsible for particular losses or shortages.

The 10 per cent. limit on deductions on account of cash shortages or stock deficiencies is a response to what emerged as a particular problem area in the consultation exercises conducted in 1983 and 1984. We consulted on the 10 per cent. figure, which proved acceptable. There is no evidence of any more general problem and no reason for the 5 per cent. limit proposed in this amendment. Even if the principle that workers could not be asked to accept a contractual responsibility unconstrained by various statutory controls on the behaviour of the employer were accepted, these particular controls seem to have no great merit. Why a 5 per cent. limit on wages when someone else is responsible for the loss? I think it would be wisest just to leave matters to the parties as is proposed in the Bill.

The noble Lord really is amazing. If he wants to say that he should like our amendment to propose one-fifth rather than one-twentieth, of course we will do that; but otherwise what he says is quite irrelevant. We say one-twentieth because we are trying to be reasonable. It is not an argument against our reasonability for the noble Lord to say that we should have been unreasonable or less reasonable.

Then he says that he thinks there are circumstances in which when stoppages occur as a result of cash loss or stock loss one-tenth is a reasonable figure; but where deductions arise not from cash or stock but from some other cause no figure at all is reasonable. What possible argument can there be for that? I expect the noble Lord to make the arguments about uncertainty. I expect him to tell me that otherwise employers will not be able to employ people. I think it is time he set that to music.

moved Amendment No. 15:

I should like a little more clarification from the noble Lord, Lord Wedderburn, because I do not altogether understand the significance which is attached in this amendment to the distinction between an express and an implied term of contract; and I must admit to being something of a layman in these matters. If, for example, there is a collective agreement which sets out, say, a disciplinary procedure, that could lead to pay being withheld and that would surely be recognised (would it not?) by any court or tribunal as a valid implied term of the employee's contract.

Moreover, as I understand the Bill, it protects employees against arbitrary wage deductions based on implied terms because the employer has to tell the employee that such a term exists and give him a written explanation of what it means before making any deduction. The employee also has the fallback remedy to which I suppose we shall come later. If he believes there is no implied term in his contract he can complain to an industrial tribunal, which will decide whether there is such a term.

It may be that I have misunderstood what the noble Lord has in mind or that there is much more to it than what I have seen, but I felt that I should give expression to that doubt.

I am afraid I do not support the amendment. When speaking about terms of a contract we in the law know perfectly well that they can be express or implied, or they can be oral or in writing; and we always manage to deal with them quite well. In the old days we had requirements for the terms to be in writing, but we have lost all that and we can have them quite generally, as the words are in the Bill. Therefore I do not support the amendment.

Having listened to the noble and learned Lord, I am not sure there is any more I need say; but perhaps I should explain that under the Bill as drafted the employer will have to give the worker a copy or a written explanation of any terms authorising a deduction from wages prior to the making of a deduction authorised by them. The important objective is to ensure that the worker knows of the terms before any deduction is made on account of them.

Taken with Clause 1(4), which deals with retrospective amendments of the contract, these are strong controls. Proposals to strengthen these controls must be balanced against the added complexity for the employer, and the danger of creating a situation where he can easily trip over a technicality. The amendment would rule out implied terms of contracts from being terms which could authorise a deduction.

The amendment seeks to bar the implied terms of contracts from being terms which, as I say, could authorise a deduction. I understand that it is common for terms of contracts to be implied from collective agreements with trade unions, custom and practice in the industry, or company rule books. A relevant example would be a term implied from a company disciplinary procedure which might itself be part of a collective agreement. There seems to be the thought behind the amendment that there is something undesirable about implied terms. That is not the case; but in any event, since the Bill makes it clear that the worker must be given a written explanation of the implied term, he will not remain in ignorance of the term simply because it is implied. I hope that in the light of this explanation the noble Lord will not wish to press the amendment.

If I do not press the amendment, I shall certainly press the argument, and it is a matter to which we may come back on Report because, with great respect, a number of fallacious concepts seem to be floating about in the Committee. It is perhaps the hour of the day. For example, there is a distinction made between terms which are implied in a contract and terms which are incorporated into a contract by reference.

So far as concerns collective agreements, the normal position is that the statement of written particulars of the employee will refer to the collective agreement, and that is not an implied term. I know of no authority to say that that is an implied term. It is a term incorporated by reference. If the two categories alone are permitted, it is more in the camp of "express" than anything like that of "implied". A company disciplinary procedure incorporated by written particulars or other document or express reference by the contract of employment is of course incorporated.

It is true that on occasion when an employer does not get his written particulars right, or when he is slovenly about the document which he is obliged under Section 1 of the Employment Protection (Consolidation) Act to give to each employee, the courts sometimes have to bend their minds to implying other documents—be they collective agreements or works rules—when it comes to the contract of employment, and they have frequently done so to the disadvantage of employees in the last decade.

It is exactly that fact to which my noble friends and I object. We object to the fact that the worker will not have the certainty of finding it in his written particulars or other document, be it under this Bill or under the Employment Protection (Consolidation) Act, and there will plainly be a great deal of overlapping of pieces of paper in that respect to which no attention appears to have been given. He is entitled to the certainty of something written down which will attract his attention. But if one is saying that we can use the implied term where the employer has been slovenly in his practice, and where he cannot even be bothered to give to the employee the proper written particulars to refer him to the documents where the deduction clause may be found and that that is where the implied term will be used, of course it will. That is precisely the matter to which we object in this amendment.

I say with great respect to the noble and learned Lord that the idea that just because most statutes and most judgments use the phrase,

"terms of a contract express or implied, oral or in writing",

then we have to use it here seems to me not to follow at all. Indeed, the implied term has expanded its scope in the contract of employment in the last 10 years—it is common knowledge—to the disadvantage of workers. In cases such as the notorious Hollister decision the courts have expanded the implied term "to co-operate" on the workers' side in such a way that, despite one or two judgments putting obligations on employers, managerial prerogative has been expanded in business reorganisation in the common law to a very large extent.

If the noble Lord, Lord Trefgarne, says that it will be all right because the worker will have something written down and he must know of it under this Bill, what is the point of the implied term?—because then presumably this will be covered by the Bill without the implied term and a written explanation will be enough.

I confidently expect that when we look at Hansard it will be found that there is something in the point that implied terms will operate exactly as I have outlined, when this Bill even on its own premises, should not encourage the practice of bad management. That is a situation where management has not given to workers in advance the documentary evidence of their obligations to which they are entitled. It is precisely there that the implied term will be used and, on the structure of the Bill, must be used. We ought to look again at the matter when we see the nature of our debate today. I beg leave to withdraw the amendment.

moved Amendment No. 18:

Clause 1(4) prevents employers from varying the contract or obtaining the consent of the worker to the making of a deduction in respect of a particular event and then deducting in respect of an earlier event. For example, it would be unlawful for an employer to vary the contract or obtain consent to his making deductions for lateness, and then to institute deductions for incidents of lateness that had occurred some months previously.

I must assure the Committee that Amendments Nos. 18 and 20 are of no effect, but that Amendment No. 18 amends the reference to relevant provisions in Clause 1(4) to cover all provisions of a contract, and since deductions can be authorised only by relevant provisions as defined in Clause 1(3), this is of no effect. Amendment No. 20 simply says that deductions or receipts covered by the subsection are unlawful, which is already the case. Amendment No. 19 would have the effect that an employer could not enter into a contract with the worker and then make a deduction from his wages on account of a matter that occurred before the contract was entered into.

I wonder how real is the problem that the amendment seeks to deal with. If an employer agrees to take on a worker for the first time, what event might there be that happened before the contract was forged in respect of which the employer might want to make deductions? It cannot be anything to do with the employment relationship, as there was no employment relationship.

The amendment might have some unfortunate side-effects. It would debar an employer from reaching an agreement to take on a worker, subject to the worker agreeing to have deductions from his wages in respect of something that had already happened before the employment commenced; for example, the individual had borrowed money from the employer before he worked for him or had run up a debt with him as a customer of his business.

The problem that the clause deals with is where the employer agrees terms, seeks to vary them and then makes a retrospective deduction in respect of an event related to the employment relationship that occurred before the variation. This is rather different from employer and worker agreeing terms at the outset of employment that incude provisions for deductions in respect of past events when the worker was not employed but was perhaps a customer. I think that the amendment adds little by way of extra protection, at a possible cost of some unintended side-effects, and I hope that the noble Lord will not wish to press it.

One of the problems with these amendments and with the noble Lord's response is that many of them relate to apparently small points, but they are real ones. Each one, it is argued, will either be all right in practice or will have no effect.

If I may illustrate, the Minister by advancing up the flanks, as it were, has forsaken his mid-field. He says that there must be the possibility in a contract to allow for the recovery of money borrowed from the employer or debts incurred previously by way of business; so the principle of retrospection is not to be absolute. I can see some force in that. One might wish to take account of that, but the Minister will not allow variations for that. Why not? The provision does not allow variations for money borrowed, debts run up in business, and so on, previously. On the Minister's logic he ought to allow variations for that.

I merely take two points. Secondly, the Minister asks how real all this is. It is very real. The example that I gave was a simple one of a youngster working in a shop, just helping out and then being taken on. But we are dealing especially with the part-time employee, the short-term contract, the casual contract and all the other forms of a typical and marginal employment which are now being analysed by the academics but which are not doing a great deal of good for some of the workers, compared to their need for full-time and secure employment. We rarely get the numbers broken down into the jobs that are part time and insecure.

The point about short-term or casual contracts is that there may well be a short-term contract for a few days and then for a week or two. Those would be broken up and they would be separate contracts. They would not fall under the ban of variation. They are not variations one of another; they are short-term and separate contracts, except that in some such cases the courts—and this is an area of complete confusion in case law—imply what they call a global contract to cover the relationship. But in the majority of such cases there are fragmented, short-term relationships for such workers; fishermen, for example. There have been cases recently where people have been held to have only short-term contracts, interspersed with periods away.

I take the Minister's point that different types of debt may well be considered separately. But no kind of retrospection is to be forbidden there. It is not within the Government's logic to permit restrospection there, for all types of debt anyway, and to ban it for variation. I ask the Minister whether he will say that he will look at that again. In practical terms that could be an important point. We all know that deductions are often made in respect of stock losses—perhaps a little less so for cash shortages—which take some time to come to light. Periods of time matter in the relationship between the parties. In asking leave to withdraw the amendment, I hope that the noble Lord will consider carefully what result subsection (4) as it stands will have.

Before the noble Lord seeks permission to withdraw the amendment, he has asked me specifically whether we will look at the matter again. I am bound to say that I cannot see much scope for that. However, I wish to be as constructive as 1 can be. I think that he is asking us to look at the possibility of distinguishing among different kinds of debt, where some would be deducted retrospectively and others would not. I believe that that presents considerable difficulties of definition. Nonetheless I shall ask for the matter to be looked at, but, to be frank, not with much expectation of success.

moved Amendment No. 22:

I understand that it is common for workers to agree that the employer can deduct sums and pay them to third parties—for example, to a trade union, a charity or a social club—with the third party telling the employer how much to deduct; for example, what subscription is due. The most common example is the check-off of trade union subscriptions, the worker signing an agreement that the employer pays directly to the union subscriptions of an amount notified by the union. Such arrangements are perfectly proper, but it would be wrong, I think, if the employer was guilty of an unlawful deduction if the union got its calculations wrong.

The amendment is clearly designed to protect the worker where the third party is employed by or controlled by the employer. The thought is, I think, that the employer could possibly instruct the third party to advise him to deduct a larger sum than was properly due, part of which was then paid back to the employer.

I believe that the worker is already well protected. Deductions on account of those arrangements are still covered by Clause 1, if the worker has not signed his agreement to the arrangement. The protection of the worker against the abuse of that provision is that he can always withdraw his agreement. I recognise the concern that lies behind this amendment, but I think that it is unnecessary because the worker is well protected even without it.

I hear what the noble Lord the Minister says. I beg leave to withdraw the amendment.

I must point out that if Amendment No. 23 is agreed to I shall be unable to call Amendments Nos. 24 and 25.

moved Amendment No. 23:

Perhaps I may just swiftly explain the objective of Clause 1(5)(e). If a worker is involved in industrial action—for example, in a go-slow or other similar action in which the worker stays at work but deliberately hampers production—the employer is often entitled to deduct something from his wages. There may be an express term in the contract that allows for that, but more often there will be an implied term in the contract that the worker does not behave in that way and that, if he does, the employer is not obliged to pay him his wages in full.

The worker can of course go to the civil court and argue that the employer is in breach of the contract in making such a deduction. There are a number of cases where a worker has taken an employer to court and, in some instances, the courts have disagreed with the employer's interpretation of the implied term of the contract and have made an award to the worker.

Clause 1(5)(e) leaves the existing legal situation in respect of deductions on account of the worker having taken part in industrial action broadly unchanged, Clause 1 will not apply to such deductions, so the worker's redress if he believes that the deduction is not contractually authorised is to the civil court for breach of contract rather than to an industrial tribunal. In the Government's view, it is best that contentious and difficult problems concerning deductions in disputes, where emotions may run high, remain matters for courts and not for industrial tribunals. The courts—not tribunals—are best placed to deal with such matters. Each of these amendments changes that situation. Amendment No. 23 reverses it entirely. Amendment No. 24 effectively does the same thing as a tribunal could be asked to decide if a deduction was authorised by the worker's contract. Amendment No. 25 has the effect that a tribunal could be asked to consider whether the employer had treated all workers on strike equally. It is arguable, I believe, either way, whether the employer should be prevented from being selective and from deciding to forgo his right to make deductions from some workers, although our fundamental objection to the amendment remains that these issues are best not put to tribunals at all. I believe that Clause l(5)(e) is essential and that each of these amendments destroys it or erodes it significantly.

The noble Lord, Lord Wedderburn, was concerned to know why we should exclude deductions for strikes and industrial action. The answer is that it is partly because, as the noble Lord himself said, the scope of implied terms is often uncertain, and particularly so, I fear, in this field. The employer would have real difficulty knowing what the implied term was and would therefore be debarred from making any deduction by the technical requirement of Clause 1 (3)(b) to explain the effect of the term in writing to the worker. I hope that these difficulties will have persuaded the noble Lord that he should not press the amendment.

I am nearly encouraged to press it, especially when the Minister, to whom I am grateful, says that deductions can be made in the case of a go-slow because it will be a term, and often an implied term, of the contract that employers are allowed to do so. As seen in the recent teachers' case, this may be difficult to interpret. But the noble Lord goes on to say that implied terms arc very difficult and that this explains why the Government have excluded the area of strikes and industrial action from the scope of Clause 1. To exclude the problems of implied terms from Clause 1 and to leave the matter to common law where one finds implied terms that are very difficult to interpret seems a curious policy to follow. The Government wish of course the employer to be in the clear, so far as this is possible, in respect of fines for industrial action. That is what they wanted; that is what they have done. It is that approach that these amendments were meant to challenge. 1 beg leave to withdraw the amendment.

The Committee will not be surprised to find that we wish to oppose the Motion that the clause stand part of the Bill. I wish to say a few words about what the clause does, what the Government have said and done this afternoon and what the consequences, we believe, will be. This clause is to replace the provisions of the 20 or so Acts dealing with deductions and payments by workers with two broad tests: what is allowed and provided by the statute, and what is contained or implied in the contract. We have sought in various ways to argue that this is insufficient. We have sought to argue that it is an imperfect form of protection, in particular in relation to Section 1 of the Truck Act 1896 and most especially in relation to that part of the 1896 Act that has been represented this afternoon as the reasonability test.

As a result, we have tried to put down 10 effective—nine of them very minor—gateways, into reasonability. We tried to get the Committee to reintroduce the reasonability test. The noble Lord, Lord Rochester, tried to get the Committee, if not to introduce it by statute, to put it in the code of practice. We tried to get the Committee to limit the authorisation of deductions to those that were contractual only. We tried in Amendment No. 5 to say that consent must be by the employer. We tried in Amendment No.8 to confine a deduction to dishonesty and default of conduct on the part of the worker. We tried in Amendment No. 10 to limit the rates of reduction. We tried in Amendment No. 15 to insist on express intent. We tried in Amendment No. 18 to limit retrospection and, in Amendment No. 22, to have a limit on what can count as a lawful third party. Finally, my noble friend Lord Wedderburn tried to limit deductions in cases of strikes in Amendment No. 23.

What have been the Government's answers? I must be fair. Apart from the one, or perhaps one and a bit, that the noble Lord undertook to take away, to our 10 reasonable but minor ways into reasonability we have had five defences. The noble Lord has said that the amendments, or parts of the amendments, were declaratory of the Bill and therefore not necessary anyway. The noble Lord has said that even if they were not declaratory of the Bill, they would have no effect and were not required. Thirdly, he has said that they might have some effect but that they would also, unfortunately have side effects and that such side-effects could not possibly be tolerated.

The noble Lord has said repeatedly that the amendment would foster uncertainty. Here, we have had some advance on previous statements by the Government. I congratulate the Minister. Previously, and particularly in respect of the reasons for the Government taking out the reasonability test, we had no explanation at all. The Secretary of State on Second Reading—I had intended to read out his remarks but I shall not now do so—did not really refer to the reasonability test specifically at all. He talked about the chaos and the archaic nature of the present Truck Acts, as indeed did the Minister in another place. What they are really talking about is the difficulty of doing something about restrictions on deductions by check. That may be chaotic. We are talking about stoppages. We are talking about deductions.

For the first time, we have had some kind of defence in terms of uncertainty. We have been told about the position of the employer who would be uncertain if any of our amendments were accepted. And finally of course we have had our old friend, the employment effect. Employers would not like it. If these things were done, employers might not employ people, might employ fewer people or might dismiss people. Here, the Government ease into an area where there are a few facts. That is something that the Government do not like to do. Several surveys have been done including those by the Institute of Policy Studies and the Government's own study, Burdens on Business. These suggest overwhelmingly that when businessmen, even small businessmen are asked what it is that limits employment, their reasons—in so far as they give reasons—have nothing whatever to do with the Truck Acts. They are to do with VAT, with taxation and with all kinds of complex forms that come from the Department of Trade. Very few, if any, talk about Section 1 of the Truck Act 1896.

Nevertheless, the Minister says that there will be an employment effect. It is not only we, on this side, who say that there is no justification for this clause or indeed for Part 1 of the Bill. Evidence has been submitted, following upon the consultative document, by the National Association of Citizens Advice Bureaux, by the law centres, by the CBI and by the Institute of Personnel Management. The general thrust of this evidence is that there is no justification for this part of the Bill. There may be some justification for the chaos of check restrictions. But there has been no substantial evidence against Section 1 of the Truck Act 1896. We have therefore to ask the Committee to oppose this clause. We do not say that, in destroying the unfair and unreasonable provisions of the 1896 Act, that the Government want to be unfair and unreasonable. We do not say that the Government believe that the result will be that employers will be unfair and unreasonable. We say that, in the interests of their ideology and their friends, they do not care whether or not they are unfair or unreasonable.

I rise to support my noble friend who is moving that this clause shall not stand part of the Bill.

As with the Shops Bill, we are discussing a situation which applies to employees who are in a particularly vulnerable situation. The Victorians believed that such people had to be protected. I remind Members of the Committee opposite that Disraeli played some part in that, because a long time ago, when I was at school, I remember reading his book, Sybil—the Story of Two Nations. I can still remember the description of the "tommy shops" and the operation of the "tommy shops" which eventually led to the Truck Acts legislation.

There was an acceptance then, and there should be now, that there was a parliamentary obligation to protect those who are most vulnerable. I believe that it is partly because the Government have not recently been seen to discharge that duty that the Shops Bill ultimately failed to pass, and that the Government were defeated in Committee in your Lordships' House last night on some key sections of the Social Security Bill.

I believe it was claimed by the Minister in another place that the new provisions on deductions represent a step forward for vulnerable employees. It does not appear to us on these Benches to be so. It is true that it abolishes the distinctions between workers. The Truck Acts were limited in their cover to manual workers and I know from my own experience as an official for a white-collar union that they did not apply to white-collar employees. Nevertheless, the mere fact that the Truck Acts were there inhibited employers when it came to making deductions, even as far as white-collar employees were concerned. There is no requirement now because we failed to get the amendment that any deductions had to be fair and reasonable past your Lordships' Committee. That of course was a key element in the older legislation.

There have been a number of cases recently which have been referred to in the Committee, and I do not want to go over that. However, I want to remind noble Lords that many of the people who operate as cashiers at petrol stations—and their cases have been referred to—are often from ethnic minorities with, in many cases, a very inadequate grasp of English. To suggest that these employees, who no doubt are often happy to have any sort of job at all, are capable of negotiating a contract about deductions and understanding what it means, is quite frankly absurd. Moreover, because of the transitory nature of much of this work, which has already been referred to in the debate, and the relative isolation of the people who do it, they are not particularly easy to organise into unions.

In such circumstances, if they cannot protect themselves, it is up to Parliament to do so. Just how necessary this protection is can be gleaned from some of the reports produced by some law centres. Fortunately, some employees who felt themselves to be victimised have been able to have recourse to such centres and law centres have been able to assist them in a number of cases. I should like to quote from a recent report by the Hounslow Law Centre, which has been doing a great deal of work in this area. It says:

"Till shortages can occur in many ways: customers can be dishonest; cheques bounce; meters are faulty or are misread; tired cashiers made to work without the breaks to which they are entitled may give too much change. In our experience management is rarely concerned to trace the error or give advice about preventing recurrences. It is much easier to make a cashier pay. The result is that cashiers' already low wages are regularly reduced below the poverty line as a result of events which are not their fault".

The Hounslow Law Centre says that in the past year it has dealt with 35 inquiries about deductions, 26 of which were from petrol station cashiers. It says that it has been successful in a number of cases.

Of course, with the absence of Truck Acts protection and with the absence of the fair and reasonable amendment which we tried to insert in the Bill before the Committee, these people will not have that protection in the future. If it is claimed that the law is difficult to enforce, all I can say is that we ought to do something about the inspectorate. We ought to have more inspectors in order to ensure that that law can be enforced for the benefit of a very vulnerable workforce. I support my noble friend's Motion that the clause shall not stand part of the Bill.

I am not sure whether the noble Lord, Lord Rochester, wishes to speak?

I thank the noble Lord for giving way. I feel obliged to say that, in the light of the discussion which took place over the first amendment relating to the need, as I saw it, for deductions from wages to be fair and reasonable, and in order to be consistent I must oppose the question that this clause shall stand part of the Bill even though, as the Committee will have seen, I have reservations about a number of amendments tabled thereafter.

Members of the Committee will not be surprised to hear that I very much hope this clause will remain part of the Bill. The clause of course provides a new and uniform protection for all workers, manual and non-manual, against arbitrary deductions from their wages. Deductions from wages will be lawful where they are provided for in the contract of employment, where the worker agrees to them in writing or where they are authorised by statute. This leaves it to the parties themselves to decide the circumstances in which deductions should be allowed, enabling the parties themselves to sort out provisions that are clear, easy to understand and mutually acceptable.

I believe that this is a fair and workable system. For manual workers the new protection replaces out-dated protections which were uncertain in their application, confusing to understand and which applied to circumstances which might have prevailed in Victorian times but which are no longer relevant to modern conditions. For non-manual workers they introduce for the first time statutory safeguards against unfair deductions where previously workers have had to rely on common law remedies.

The provisions are designed to be straightforward and clear so that employees and employers know exactly where they stand. I hope that Members of the Committee will agree that this clause should remain part of the Bill.