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Workers (Predictable Terms and Conditions) Bill

Debated on Wednesday 8 March 2023

The Committee consisted of the following Members:

Chair: Sir Robert Syms

† Bacon, Gareth (Orpington) (Con)

† Benton, Scott (Blackpool South) (Con)

Cates, Miriam (Penistone and Stocksbridge) (Con)

† Clarke, Theo (Stafford) (Con)

† Dalton, Ashley (West Lancashire) (Lab)

† Ferrier, Margaret (Rutherglen and Hamilton West) (Ind)

Ford, Vicky (Chelmsford) (Con)

Fysh, Mr Marcus (Yeovil) (Con)

† Hollinrake, Kevin (Parliamentary Under-Secretary of State for Business and Trade)

† Hunt, Tom (Ipswich) (Con)

† Morris, Grahame (Easington) (Lab)

Nichols, Charlotte (Warrington North) (Lab)

Richardson, Angela (Guildford) (Con)

Roberts, Rob (Delyn) (Ind)

Stringer, Graham (Blackley and Broughton) (Lab)

Western, Andrew (Stretford and Urmston) (Lab)

† Whittaker, Craig (Calder Valley) (Con)

Rhiannon Hollis, Anne-Marie Griffiths, Committee Clerks

† attended the Committee

Public Bill Committee

Wednesday 8 March 2023

[Sir Robert Syms in the Chair]

Workers (Predictable Terms and Conditions) Bill

Before we begin, please switch off electronic devices. No food and drink are permitted during sittings of the Committee, except the water provided. Hansard colleagues would be grateful if Members emailed their speaking notes to My selection of groupings for today’s sitting is available online and in the room. No amendments have been tabled. We will have a single debate on all clauses of the Bill and the schedule.

Clause 1

Workers (except agency workers): right to request predictable work pattern

Question proposed, That the clause stand part of the Bill.

With this it will be convenient to consider the following:

Clauses 2 to 4 stand part.

That the schedule be the schedule to the Bill.

It is a pleasure to serve under your chairmanship, Sir Robert. I am delighted that we are here today to take another step towards introducing a new right for workers to request a more predictable working pattern.

The 2017 Taylor review of modern working practices found that workers on zero-hours contracts, agency workers and temporary workers struggle where flexibility is one-sided in their employer’s favour. Some employers misuse flexible working arrangements to create unpredictability and insecurity of income, and some workers are reluctant to assert their basic employment rights. To address the issue of one-sided flexibility, the Taylor review recommended that the Government create a new right to request a contract with guaranteed hours for zero-hours contract workers.

My Bill will introduce a new right for workers to request a more predictable working pattern. A qualifying worker will be able to make an application to change their existing work pattern if it lacks predictability in terms of the hours or times they work, or if it is a fixed-term contract for less than 12 months.

The right will apply to all eligible workers, including agency workers—not only those employed on a zero-hours contract. That will ensure that the right will benefit a range of workers with unpredictable working conditions, including temporary workers, agency workers and workers with non-guaranteed hours. Workers must first have worked for their employer for a set period before they make their application. This period will be set out in regulations, but it is expected to be 26 weeks. A worker needs only to have been employed with their employer at some point during the month before that period, and to be working again for their employer when the application is made. The same criteria will apply to agency workers and those working on behalf of temporary work agencies. Agency workers who make applications directly to hirers will be required to have worked for their hirer for at least 12 weeks continuously during the 26-week period.

Once a worker has made their request, their employer will be required to notify them of their decision within a one-month timeframe. An employer will be able to turn down a request for a more predictable working pattern based on specific statutory grounds, similar to those established for the existing right to request flexible working. That will help to ensure that businesses are not unfairly burdened by the new right—for example, if the cost of providing the worker with a more predictable working pattern would be too burdensome on the business. Workers will have the option to complain to an employment tribunal if their employer does not handle the request in a reasonable manner, wrongly treats the request as withdrawn, dismisses or treats a worker poorly because of their request, or rejects the application on the basis of incorrect facts.

I am delighted that the Bill has support from the Government and from Opposition parties. We are keen to ensure that it can progress through the House quickly so that this important new right for workers can be introduced. I will now discuss the detail of the four clauses and one schedule, which will make new provisions in part 8A of the Employment Rights Act 1996.

Clause 1 inserts a new chapter into part 8A of the Employment Rights Act. These sections introduce the right to request a more predictable working pattern for non-agency workers. Section 80IA provides that a worker may apply for

“a change in terms and conditions”,

while section 80IB provides that a worker can apply only if they were

“employed by the same employer”

at some point during the month immediately before the prescribed period, ending with the making of the request. The length of that period will be set out in the regulations.

Section 80IC sets out what the duties of an employer are when receiving requests. It must deal with the request in a reasonable manner and notify the worker of its decision within one month. Section 80ID allows a worker to make a claim to an employment tribunal where the employer has not complied with its obligations, and section 80IE sets out the remedies that an employment tribunal can award if the claim is successful.

Clause 2 introduces the right to request a more predictable working pattern for agency workers. It inserts chapter 3 into part 8A of the Employment Rights Act 1996. A number of the provisions mirror those in clause 1, so I will highlight only those sections that differ materially from clause 1.

Section 80IF provides that an agency worker may make a request to either a temporary work agency

“with which the agency worker has a contract to perform work or services personally”

or a hirer under whose supervision and direction they are working. Section 80IG requires that workers making an application to a temporary work agency must have had a contract with the agency at some point in the month immediately before a period prescribed in the regulations. Workers making an application to their hirer must have worked in the same role with the same hirer continuously for 12 weeks in the period specified in the regulations.

I congratulate the hon. Gentleman on introducing the Bill, which is a welcome step in the right direction. I am aware of the figures for the number of workers who are on zero-hours contracts, but does the hon. Member have a figure for the number of workers who would be covered by the Bill?

I do not have the figures at hand, but I will gladly work with the Minister’s private office to see whether we can obtain them.

Using experience from my own constituency, Blackpool South, a large number of people work on zero-hours contracts in the leisure and hospitality industry. Anecdotally, from speaking to those businesses, I believe that several hundred constituents of mine would have the legal right to request a more predictable working pattern. If we extrapolate from that across the country, we are no doubt speaking about potentially millions of workers who could benefit from this. I thank the hon. Member and his party for their support on Second Reading.

Section 80II sets out the circumstances in which requests must be considered after an application has been made, but before a decision has been reached, the contract that the agency worker has with the temporary work agency comes to an end, or the agency worker ceases to work under the direction of the hirer.

Clause 3 inserts chapter 4 into part 8A of the Employment Rights Act 1996. It makes provision to ensure that workers cannot make more than two requests in any 12-month period. That ensures that the policy is in line with those on flexible working, which also permits up to two requests per year. It also makes provision to ensure that workers cannot make a request for either flexible working or a more predictable working pattern if they have another request in progress.

Clause 4 is a straightforward measure that addresses the extent of the Bill, makes provision for commencement and provides the short title of the Bill. The schedule contains a list of amendments to other employment legislation that will be required to ensure that this measure is effective and does not adversely affect existing legislation. That includes provisions to ensure that there is legal protection for any worker who is penalised by their employer because they have tried to exercise their new right to make those requests, and for an employee who is dismissed as a result of doing so. There is also provision to deal with the potential passage through Parliament of the Employment Relations (Flexible Working) Bill at the same time as this Bill.

It is a pleasure to serve under your chairmanship, Sir Robert. I congratulate the hon. Member for Blackpool South on introducing the Bill and explaining the provisions in such an eloquent and articulate fashion. It is apt that we are considering the Bill on International Women’s Day, as it is women who are disproportionately affected and victimised by poor employment practices, and subjected to insecure employment. I welcome the Bill for that reason and a number of others.

My earlier question to the hon. Member was based on some family experiences. My eldest son was working in retail in the north-west. He was in the category where he did not have a zero-hours contract, but he did not have a secure, specified number of hours. Before Christmas, he was expected to work 60 hours a week. Once the peak of demand had subsided, the guaranteed hours fell substantially. However, he could not go to his landlord and say, “Well, I have had only 20 hours this week, so is it okay if I give you only half my rent?”

The issue affects many hundreds of thousands of workers, and this is an important step forward. I welcome the Bill, because it gives workers on atypical contracts, especially zero-hours contracts, more predictable and stable working hours. It gives people a greater say over when, where and how they work. It is right that the Government address one-sided flexibility, which inevitably benefits employers, and often forces employees to put their lives on hold when they are called up at short notice for shifts. Not having a secure employment also has implications for any kind of hire purchase debt, such as mobile phone contracts.

It will probably come as no surprise to Conservative Members that I support the abolition of zero-hours contracts altogether. I would welcome a comprehensive employment rights Bill that would provide statutory protection against all forms of poor employment practices. Nevertheless, notwithstanding my reservations, I welcome the intention of the Bill and I am pleased to support the hon. Member for Blackpool South today.

It is a pleasure to serve under your chairmanship, Sir Robert. I was interested in serving on this Committee because the Bill sits in employment law, which is a reserved policy area. As we know, the territorial extent will include Scotland when the Bill secures Royal Assent.

We have heard about difficulties with zero-hours contracts for years. It is fundamentally unfair that those on zero-hours contracts are expected by employers to be completely flexible and available at short notice, with no guarantee of shift patterns or even paid work at all. Although the Bill does not give workers the right to a fixed and predictable working pattern, it sets out clear grounds on which an employer can decline, limiting spurious refusals. That is a positive step.

If the Bill is enacted, it will have some very positive impacts, such as reopening the door to employment for those currently out of work. We have heard a lot in recent weeks about the impact of a lack of suitable childcare on women and single parents, and their ability to participate fully in the labour market, which costs the economy £38 billion a year by some estimates. I can only imagine how much more difficult finding childcare becomes for someone on a zero-hours contract, or someone working in the gig economy who may need it at incredibly short notice. I thank the hon. Member for Blackpool South for introducing a Bill that will begin to make the necessary changes and I congratulate him on seeing it through its legislative stages so far.

It is a pleasure to serve under your chairmanship, Sir Robert. I start by thanking my hon. Friend the Member for Blackpool South for bringing this Bill before the House and for his clear explanation of its clauses. I am delighted to be here today to reiterate that the Government fully support the Bill, which will introduce an important new employment right and tackle the issue of one-sided flexibility.

The Bill will empower workers to start conversations with their employers about their working patterns, with the confidence that starting such a conversation will not result in detriment to them. Under the Bill, workers will have recourse to an employment tribunal if their employer does not handle their request in a reasonable manner. Although workers will be able to request more predictable working arrangements, they will be able to continue working on a zero-hours contract—or another form of non-guaranteed hours contract, or temporary contract—if that is the type of contract that works best for them.

The right will function in a similar way to the existing right to request flexible working. An employer will be able to refuse a request for a more predictable working pattern on specific statutory grounds, similar to those established for flexible working. We know how important it is to balance new workers’ rights with their impact on businesses, and these grounds will act as a safeguard to ensure that employers do not experience disproportionate burdens. I draw the Committee’s attention to the impact assessment, which says quite clearly that there is an impact on business. The net cost to business will be £16.9 million a year. It is important always to look at the impact on businesses, to ensure that there are not too many undue burdens on them.

This Bill will reap rewards for employers as well as workers. As the hon. Member for Bath (Wera Hobhouse) and my hon. Friend the Member for South West Hertfordshire (Mr Mohindra) so aptly described it on Second Reading, the Bill is a “win-win” for workers and employers. The new right will boost workers’ satisfaction and productivity and allow employers to retain skilled staff, as workers will not have to look for a new role in order to secure a working pattern that meets their needs.

As my hon. Friend the Member for Blackpool South has set out, the clauses of this Bill will make new provisions in part 8A of the Employment Rights Act 1996, to introduce a new right for workers to request a more predictable working pattern. I agree with his very accurate description of the clauses. They will introduce this important new right and will set out the eligibility criteria for workers; employers’ duties when considering requests; and the circumstances in which workers can make a complaint to an employment tribunal. They will limit the number of permitted requests to two per year, in line with the number of requests that will be permitted under the Employment Relations (Flexible Working) Bill, which recently had its final stages in this House.

The clauses also contain 11 provisions to make regulations. We have considered the use of powers in the Bill and are satisfied that they are necessary and justified. The Bill contains, among other powers, powers for the Secretary of State to make regulations that specify for how long a worker must have been employed by their employer before making an application. We expect the regulations to specify that that period will be 26 weeks. The worker will have only to have been working for their employer at some point during the month before that period and to be working again for their employer when the request is made. Given that the Bill targets workers with unpredictable working patterns, they do not have to have worked for that employer continuously during that period. I agree that clauses 1 to 4 and the schedule should stand part of the Bill.

The hon. Member for Easington asked how many people the legislation would affect. The central estimate is laid out in the impact assessment. It says that we believe that about 122,000 to 336,000 requests might be made through the provisions in the legislation.

We are supporting this Bill in line with our ambition for a strong and flexible labour market that supports both participation and economic growth. I thank those on the Committee today, and those who spoke on Second Reading, for supporting the progress of the Bill so far, including my hon. Friend the Member for Blackpool South and the hon. Members for Easington and for Rutherglen and Hamilton West.

I look forward to continuing to work closely with my hon. Friend the Member for Blackpool South to support the passage of his Bill. I conclude by extending particular thanks to you, Sir Robert, for your excellent chairing.

I begin by thanking you, Sir Robert, for your chairmanship. I thank every Member who has given their time to serve on this Committee. In particular, I thank the hon. Member for Easington for his comments. He mentioned the irregularity experienced by some on zero-hours contracts and its detrimental effect on their financial stability. That should be at the forefront of everyone’s minds, given the considerable challenges that many of our constituents face with the cost of living at the moment. That is one very good reason why this Bill is progressing through the House.

I also thank the hon. Member for Rutherglen and Hamilton West, who is a fantastic advocate for her constituents. I think she probably speaks more often in this House than any other Member, apart from the hon. Member for Strangford (Jim Shannon). I am pleased to see her here. She made a particularly good point about workers on zero-hours contracts experiencing inflexibility with childcare, with the added pressure and stress of trying to juggle their daily routine, family, finances, work-life balance and so on. If this Bill does nothing else, I hope it will help those struggling with childcare.

I also thank the Minister for his brilliant support and extend that thanks to those in his private office, who have been extremely helpful over the last few weeks. In closing, I reiterate the importance of this Bill and I hope that it can progress through the House quickly.

Question put and agreed to.

Clause 1 accordingly ordered to stand part of the Bill.

Clauses 2 to 4 ordered to stand part of the Bill.

Schedule agreed to.

Bill to be reported, without amendment.

Committee rose.