That the draft Regulations laid before the House on 5 December be approved.
Relevant document: 20th Report from the Secondary Legislation Scrutiny Committee
My Lords, the Trade Union Act modernises the UK’s industrial relations framework to better support an effective and collaborative approach to resolving industrial disputes. The Act restores a level of fairness to our industrial relations regime and gives effect to the Government’s manifesto commitments. It ensures that strikes can happen only as a result of a clear, positive decision by those entitled to vote, balancing the interests of unions with the interests of the majority of people who rely on important public services. The Act is not about removing rights. Indeed, the Prime Minister in her recent speech on Brexit made it clear that as we leave the European Union and translate the body of European law into our domestic regulations,
“we will ensure that workers’ rights are fully protected and maintained”.
The Act received Royal Assent in May 2016. Today we are debating six statutory instruments, the first five of which implement a 40% threshold for ballot mandate approval for key public service sectors. This means that as well as there being a requirement that 50% of union members who are eligible to vote do so, 40% of all eligible members will have to be in agreement with the proposed mandate. The sixth statutory instrument that we are debating today will set a 12-month transition period before new provisions for political funds come into force. These provisions will allow new union members to opt in to any political fund supported by their union, rather than any such subscription being automatic. The 12-month transition period will allow unions to make the necessary system and rule changes.
We propose that the 40% threshold and the transition period come into force on 1 March. We will also make a commencement order to ensure that Section 11 of the Trade Union Act is brought fully into force on that date. At the same time, we will bring into force a number of other provisions in the Trade Union Act. As I have mentioned, these include a 50% threshold for those eligible to vote to do so as well as additional information about the result of any ballot, two weeks’ notice of industrial action to be given to employers, new requirements to manage picketing, and reporting on industrial action and political fund expenditure. This ensures that the key changes to the way official industrial action is decided on and implemented are prioritised and come into effect as a single package.
The purpose of the ballot thresholds is to rebalance the ability of union members to strike with the interests of the general public, non-striking workers and employers. The Trade Union Act takes proportionate action to redress the balance and ensure that unions in these sectors have a strong democratic mandate before they take strike action.
The impact of strike action is most severe when it takes place in the important public services that people and businesses rely on every day, particularly where it leaves people with no real alternatives when strikes take place. This is particularly unfair when strike action goes ahead without strong support by a unionised workforce. This is why we have introduced an additional 40% approval threshold to apply to important public services such as health and rail transport, in addition to a requirement for a 50% turnout threshold. This is a robust threshold, and rightly so. It is in the interest of the public to know that where they face disruption in these crucial services as a result of strike action, this is because union members have secured a strong democratic mandate. This is also important for union members who were not in support of strike action. I know that some noble Lords have expressed concerns that these reforms do not go far enough. The Government believe that the measures they are putting in place strike the right balance.
My Lords, neither the Minister nor I served on the committee that discussed the Trade Union Bill. However, he will be well aware, no doubt from reading Hansard, that my party made many of the proposals in what was then the Bill and is now the Act. We remain concerned about all those, including those aspects now being introduced through these regulations.
In the first set of regulations, the Government have identified within what they have defined as “important public services”—health, education, fire, transport and border security—the personnel that they believe should be covered, and so refining, as the Government put it, the list of the important public services. Within education, for example, it is teachers and head teachers but not, one assumes, caretakers, although they are very important in the running of our schools. While we are critical of the way that the Government have failed to listen to many aspects of the consultation that took place, we are at least pleased that in this one respect—in relation to ancillary workers—the Government have listened. We welcome that very much indeed.
These important public services are the ones that the Government have decided must meet not only the 50% turnout threshold criteria but also a requirement that at least 40% of those eligible to vote must have voted for strike action before it can proceed. That means, for example, that in a ballot where the turnout is just over 50%, taking industrial action would require some 80% of those voting to do so in favour. During the passage of the Bill, although we saw some merits in the setting of a threshold for turnout, we argued against the imposition of the 40% threshold. In the words of the noble Lord, Lord Kerslake, at Second Reading, it is,
“a very stiff test indeed”.—[Official Report, 11/1/16; col. 79.]
It is hardly, as the Minister sought to describe it, a proportionate approach to the problem as the Government see it.
We noted at that time, and continue to do so, that business support for these measures is lukewarm. The Chartered Institute of Personnel and Development has said that the plans are,
“an outdated response to the challenge of the modern workplace”.
Only yesterday, in the Evening Standard, we saw the results of an Ipsos MORI poll, which showed, for example, that nationwide only 37% of the public support limits on the rights of train drivers to strike, and only 35% support limits on teachers. Imposing a 40% threshold is a stringent limit. It is not a proportionate limit and it is one that is clearly not supported by the public.
As my noble friend Lord Stoneham argued during Second Reading, the 40% threshold brings with it other problems as well and would make resolving disputes more difficult. He said:
“Disputes have to be resolved through a bargaining relationship; if that is not understood, we will be led to unintended consequences. If you have thresholds, the unions will work to achieve those thresholds, so strikers could become more intransigent”.—[Official Report, 11/1/16; col. 118.]
On these Benches, we also argued that quite simply no evidence has been produced by the Government that the workers who did not vote in the strike ballot are any less willing to withdraw their labour than the ones who actually did. Of course, we noted, as many did during those deliberations, that in the 2015 general election the Conservative Party won by a majority of just 12 seats—the smallest majority since 1974. More importantly, it did so with less than 24% of registered voters. The noble Lord, Lord Kerslake, played a very active part in those deliberations, and I love quoting him. At Second Reading, he said,
“the current Government happily govern with fewer than one-quarter of the electorate supporting it, and fewer than 40% of those who voted”.
He went on to say:
“That tells me as much about why we need electoral reform in this country as it does about trade union democracy”.—[Official Report, 11/1/16; col. 79.]
I entirely agree with him.
My Lords, I intend to keep my remarks short, not least because the noble Lord, Lord Foster, made many of the points that I would have made. It is fair to say that this was one of the most contested pieces of legislation that this House has seen. Indeed, during the debate, this Chamber was considerably fuller than it is now. Looking around the Room I feel a sense of nostalgia for the noble Lords who were here for that debate.
It is important to emphasise that the issue of the threshold was one of major concern, because, as the noble Lord, Lord Foster, said, it applied a test that applies to almost no other election. That is an important point. If we see other elections as giving authority to take actions, in many ways having as big a consequence for people’s lives as strike action does, we do not expect the same level of test as we do here. But—and this is the important point—that debate was had and this House acquiesced to a package of changes to the Bill at the time. While I expect no one agreed with absolutely all of what was done, it seemed in the end a fair package given the contested and strong issues. If there are noble Lords who feel strongly that it should go further, I cannot see them in the House this evening.
The point I particularly wanted to raise was that part of that package was a commitment to review the issue of electronic balloting. That was not a small point, because hand in hand with the introduction of the threshold had to be measures that would make the process of voting easier for members. It is in all our interests to see the maximum turnout. Electronic balloting alongside postal balloting was the intended approach. We comprehensively demonstrated during the debate in the House that there were no real impediments to the introduction of electronic balloting. Indeed, it was used by a wide range of organisations already.
I may have missed something, in which case I am happy to apologise on this point, but I have not seen a great deal of evidence of progress on this issue—in particular, of a proposal coming forward from the Government to say either that they have looked at this and it is not viable, or that they have looked at it and it is viable. I would welcome a response from the Minister on that point, because, if there has not been the necessary progress, the House is due an apology. It was an integral part of the settlement agreed at the time.
My Lords, the real purpose of the Act was revealed to me by a former Conservative employment Minister, when he simply said, “Bills against the trade union movement don’t cost anything and they don’t half cheer up Conservative associations in the country”. That is the double benefit derived from a trade union Act.
As we can see, the pressure is already on for another round of action—which was what, I guess, the Minister was referring to in his remarks. I will not repeat the speeches that we gave during the passage of the Bill and the situation we have arrived at now, except to say that the regulations on the double threshold are extraordinarily tough, unprecedented in their application compared to other organisations and very difficult for unions to carry through in a way that will not leave them open to legal challenge.
For example, a GCSE teacher is covered in a different way from a teacher of A-levels. In my experience, teachers often teach both. I am not arguing for widening it, I am saying that there will be many borderline areas where it will be most unclear, and very difficult for a union to specify exactly who is covered by the double threshold and who by the turnout one.
I want to emphasise the point of the noble Lord, Lord Kerslake, about electronic balloting. I do not see why this measure could not have been left until we have completed the exercise on electronic balloting—whether it will be permitted or not. That makes a considerable difference to turnout and the impact that this law will have. It could simplify things enormously.
Secondly, I would underline a point made by the noble Lord, Lord Foster, about the political fund adjustment time. Again, this year is a tough one. I am thinking not just about union conferences—everything that the noble Lord, Lord Foster, said in that respect is correct—but also about the check-off agreements with employers. The big unions have hundreds of such agreements. They will have to adjusted, and that is a major task. They will have to be renegotiated in many cases: it will not be done just by an administrative stroke of the pen. They will have to be talked about and explained to the members and to the employers.
These regulations, therefore, are tough, and I echo the request that has already been put to the Minister, to give unions rather longer to respond—an extra six months would be extremely useful.
My Lords, in focusing on the last of these regulations I do not mean to say that I agree with any of the previous five. However, the points have already been made on those.
I served on the Select Committee during the passage of this Bill, and the last of these amendments is out of keeping, in two senses, with the recommendations of that committee. First, as has already been alluded to, it presents unions with a very severe administrative problem. Secondly—to my mind this is the largest problem—even to proceed on this basis is a major constitutional outrage. I will come back to that.
Having received representations from both sides—and to try to maintain consensus—the Select Committee said that the transition period should be a minimum of 12 months. That, however, was subject to a consultation with the unions. I wanted a minimum of 18 months, subject to consultation, but we agreed on what currently stands.
The noble Lord, Lord Foster, has already referred to evidence from USDAW. I suspect that the belated report on the consultation on this point will reveal that several unions will be hard hit because of the timing of this regulation. Most unions have their conference between March and June. USDAW has it in April; my own union, the GMB, has it in June. It is impossible, in both those cases, to abide by both your own rulebook and the timetable laid down as a result of this regulation. Had the Government decided to trigger it and give them 12 months in, say, August, that would have given the unions plenty of time to abide by all the pre-proceedings of conferences and rule changes by this time next year. Instead, the Government have done so in such a way as to sabotage the ability of a conference such as USDAW’s in April—since the proceedings for it have already started—to meet the requirements of its own rules while complying with the regulation.
My Lords, I am pleased to join in this debate. I was involved in the original proceedings on the Act. A number of points have already been made which I do not need to repeat. I should like to concentrate on a couple of aspects, taking through some of the thinking that has already been displayed in this debate.
As the Government’s own record on contingency planning is very poor—as shown in the European issue—we have to ask whether they have prepared for some of the implications of these regulations. I hope that the Government have consulted ACAS on whether it has sufficient resources to deal with some of the problems to which these regulations will give rise. In the coming year, with inflation rising probably ahead of earnings, the Government are going to experience quite a lot of problems in the public sector. Resolving them will be further complicated by these regulations. They are going to have quite turbulent times. My noble friend Lord Foster quoted what I said in the original debate—that trade unions will have to invest extra resources into getting appropriate support in ballots. That has a danger in respect of strikes. As the Minister will have seen in the doctors’ dispute, where 90% support was achieved in the ballot, it was extremely difficult to get it settled and prolonged negotiations were needed. We will have much more of that in the public sector.
A further issue is bargaining units. I mentioned in the original debates what I called the winding-engine men syndrome. Those were the people in the coal mining industry who used to work the lifts. They had immense bargaining power. If you have all sorts of legal restrictions on thresholds for strike ballots, all that will happen is that you will have smaller bargaining units and therefore a greater ability to manipulate strike ballots to get the results that you want. It will be more difficult to resolve those sorts of disputes. I hope that the Government have looked at the consequences of what they are doing.
The noble Lord, Lord Kerslake, mentioned electronic ballots. It is in the Act; we passed an amendment that we would have an independent review of electronic balloting. I do not think that anybody who was involved in the debates at that time ever thought that we would implement those regulations. The understanding was that they would not be implemented until we had had the outcome of the electronic balloting review. What is the Government’s thinking on this? What is the purpose of the review and when exactly are we going to see the details of it?
I should like to re-emphasise—and it is important coming from our party—that this is a very partisan act, certainly on political funding. We deserve to hear from the Government what further action they are going to take on the Burns committee recommendations which have silently been discarded and forgotten. As we have to agree these regulations, we should know what the Government are going to do. What are they doing on the whole issue of the unfair financing of political parties, in the context of a very one-sided act against the principal opposition party? Everybody knows that this measure is partisan and will lead to a continuing imbalance in our political system.
The Government try to portray themselves as consulting and as a so-called party of one nation but, frankly, is it not incredibly insensitive to implement these regulations? The officials, or whoever did the consultation, must have known that the union conference system runs from April until July. Everyone knows that. To implement regulations that start in March is clearly therefore going to cause upset. That seems to be totally insensitive and unnecessary, and shows the total contempt that the Government have had for the trade union movement in this country in planning this legislation and in the way they are now trying to implement it.
My Lords, I associate myself with the contributions that have been made. They have been pretty outstanding and have got to the very nub of the issues.
I thank the Minister for coming forward. We have had some very engaging discussions on other issues, and it is unfortunate that he has to deal with this issue in this particular way. I hope he is absorbing what we are saying and will respond adequately to it, but we do not hold him personally culpable for what has come before us.
It is important to understand that the conventional wisdom is that the Act was originally in the manifesto merely as some barking mad idea to negotiate away when the coalition was formed and that it would not stand. It is unfortunate that the circumstances evolved as they did and we ended up with something that was so partisan and vengeful. The debates that we had in this House were very significant; indeed, the size of the majorities against the Government’s proposals—certainly, there were calls for some balancing measures for the democratic mandate so accorded—was very large, and expressed the deep concern across the whole House at these measures. We ended up passing legislation not because people were happy or because they understood it but because there was broad agreement in the legislation, in discussions with Ministers and in assurances to the House that, in the spirit of trying to pass this legislation, there would be balancing measures. It is unfortunate that the partisan approach has returned with these instruments. It is important to understand that that is at the very heart of the statutory instruments.
I spent some time—after the Act had been passed, regrettably—looking at the nature of the strikes and what caused them, and analysing some of the strikes that took place in private companies and the public sector. The issue that came up during that time was that in most of these cases it was not that there were a series of workers who just militantly desired to withdraw their labour; there were massive issues of competency of management. In fact, although I did not do an exhaustive piece of research and I cannot say I necessarily had an adequate sample, in 85% of the cases that I looked at you could identify management failures, especially in the public sector, where arbitrary decisions are announced and workers are displaced because there is no consultation or preparation. In those circumstances, we have to understand that measures need balance.
To take the example of disputes at Southern rail, at the heart of that dispute is a contract that does not work. I know the Minister has been in business before. On many occasions we have seen the consequences of poor contracts. A variety of the issues at the very heart of why there is a difficulty in resolving a problem where there are problems of the competency of management are about contracts. It is wrong always to look through the wrong end of the lens. We are looking to the Government to restore the sense of balance that we believe we had when this Act was passed.
I read the Prime Minister’s speech at Davos when she talked about the notion of the rights and the voice of people who had not been adequately covered by these sorts of things, and the importance of strong institutions. In that context, I just do not understand why the institutions that the Government seem continually to want to stress, attack and undermine are those that represent working people. It is just not the right sense of balance.
It is our belief that trade unions are a force for good and equality in our society, especially in the increasingly insecure world of work. We remain fundamentally opposed to an approach that establishes restrictions on industrial action without balancing provisions to ensure that participation can be increased.
My Lords, I am not sure if I regret not being in the Chamber when this was originally discussed, but I would have been in a better position to address some of the issues raised if I had. Reading Hansard you do not quite get a sense of the very strong feelings of noble Lords. As it was almost an empty Chamber when I arrived tonight, I thought I might get off rather more easily than I have.
I completely agree with much of what the noble Lord, Lord Mendelsohn, said at the beginning of his speech. When you have difficult industrial relations in companies or sectors, it is very often not just the fault of the trade unions but of poor management, poor contracts and the like. I completely understand that.
I think the noble Lord, Lord Monks, said that an easy way of appeasing Conservative associations is to bring in hostile trade union legislation. I think we have moved on as a party and are now more enlightened. One noble Lord also said this was a debate about nostalgia; that may be so if you look back at the Conservative Party through the eyes of the Labour Party. We may have set ourselves up to be against trade unions but I agree with the Prime Minister that we are not against workers’ rights. On the contrary, the whole thrust of our industrial strategy is to provide decent, well-paid jobs for people throughout the country.
So there is going to be a review. Does the Minister intend to implement the recommendations that were implied by the House when it asked for the review to be done?
One cannot accept the recommendations until one has seen them. We will look at the review and make up our minds on which parts of it to implement. We cannot give any guarantees now to implement it.
As I said, I shall resist the temptation to get into a debate about the funding of political parties. That is for another time. We have had a debate before about the main issues in the Bill and there is no purpose in going much beyond what I said in my opening speech about the Government’s view. I explained the purpose of the 40% ballot threshold regulations—to rebalance the ability to strike of union members in the health, fire, education, transport and border force sectors with the interests of the general public. That is quite a significant limitation. We have tried to draw the distinctions carefully. I take the point made by the noble Lord, Lord Monks, about the definitional issues; we have tried to be as clear as we can in that regard.
We have also taken a proportionate approach in relation to the political funds opt-out in transition periods. It is reasonable to say that the trade unions knew back in May that we would be going for a transitional period, and 12 months was stated as a reasonable period by the Lords Select Committee. The unions have a way of avoiding the need to hold conferences, through Section 92 of the Trade Union and Labour Relations (Consolidation) Act if they wish to use it. I do not think 12 months is unreasonable: in the Conservative manifesto it was actually three months. I imagine that some noble Lords on the other side of the House were surprised by the Government’s response to the Select Committee’s recommendations. As the noble Lord, Lord Kerslake, said, it was a fair package and that was also the view of the noble Lord, Lord Burns. We have taken a proportionate approach to the political funds opt-in transition period regulations. We took on board the very helpful recommendations of the Select Committee, and these regulations provide for a 12-month transition period for implementation.
Just to be clear, the Select Committee recommended a minimum of 12 months, subject to a consultation. The noble Lord has now had the consultation, the burden of which is that we need longer than that if we are starting in March. So he is at odds with what the Select Committee intended.
We did have a consultation, and it is true to say that our views and those of some of the trade unions were different. We do have a different view: I think the trade unions would like a longer period. But our feeling was that 12 months was a reasonable period.
The regulations support the Government’s commitment to delivering a modernised industrial relations framework to better support an effective and collaborative approach for resolving industrial disputes. I believe they are fair and appropriate, and I commend them to noble Lords.
Motions to Approve
During the passage of the Trade Union Act last year, the Government consulted on which services within the public service categories set out in the Act should be subject to the 40% threshold, and on how the threshold should operate in practice. We analysed more than 200 responses, reviewed the available evidence of the impact of strike action across different public services, and listened to stakeholders’ views. The Government response to the consultation was published in January last year, when we also published draft regulations. The substance of these was discussed in Committee in the Lords during the passage of the Trade Union Act. I thank noble Lords for their constructive and well-informed views, which helped us tailor these regulations to ensure clarity so that the services that are affected are tightly defined.
The regulations we have introduced today limit the application of the threshold to those services where there is the most compelling evidence of the impact of strike action, and ensure that its scope is proportionate. What does this mean for the sectors that are affected? The pressing social need that we are addressing in the health sector is the risk to life or injury to the public in the event of industrial action. We have therefore focused the impact of the threshold where reduced service levels can have the most immediate impact on the lives and safety of patients and the public. That is why the regulations cover emergency and urgent health services. This includes ambulance staff, accident and emergency medical staff in hospitals, services provided in high-dependency units and in intensive care in hospitals, and psychiatric, obstetric and midwifery services provided in hospitals for conditions that require immediate attention to prevent serious injury, illness or loss of life.
In the fire sector, our aim is, again, to protect the public against the risk to life or injury. In light of this, we have focused on firefighting services, including co-ordination of the emergency response, because these are all critical to ensuring that fires are dealt with promptly and effectively to protect the public.
In the education sector, the Government aim to ensure that all children have the right to an education. We are focused on teachers who work with pupils of a compulsory school age in state-funded institutions. This reflects the importance of these years for children’s education and the disproportionate impact on learning that strike action can have.
In the transport sector, our priority is to ensure, as far as possible, that large numbers of people can rely on the services they need every day to make important journeys. We have, therefore, focused on passenger services, because strike action is more likely to have an adverse and immediate impact on people’s ability to go to work, school and college and to important appointments. That is why the regulations cover passenger railway services, including the maintenance of trains and the network, and the signalling and control of the operation of the train network. The regulations will also cover any London local bus service, civil air traffic control services and airport and port security services.
Finally, in the Border Force, we are addressing the significant risk to public safety in the event of disruption to border controls. We are focused on services in respect of the entry and exit of people and goods, as these are central to the carrying out of checks, and to prevent illicit commodities entering the country.
I believe members of the public will agree that strikes in these important public services should take place only where there is a strong level of support for a justifiable mandate. I hope I have reassured noble Lords that these regulations are justified and proportionate to our objective.
During the passage of the Trade Union Act, this House debated at length the principle that union members should make an active choice to contribute to a trade union’s political fund. This place established a Select Committee on Trade Union Political Funds and Political Party Funding under the chairmanship of the noble Lord, Lord Burns. I start by thanking the noble Lord and all the Peers who sat on the Select Committee, on a cross-party basis, for their work, which helped to move forward the debate on this element of the Act.
I want first briefly to remind noble Lords why the reforms in the Trade Union Act in relation to political funds are important. As part of our manifesto commitment, the Trade Union Act introduced a requirement for all union members to actively opt in to their union’s political fund following a transition of three months. Members who chose to opt in would need to reaffirm their choice every five years. We made this proposal because until we make these changes a union member automatically contributes to a union’s political fund as part of their union subscription, unless they notify the union that they do not wish to do so. We do not believe this is satisfactory or transparent, bearing in mind that we are talking about significant amounts of members’ money. In 2015-16 the total income and expenditure in relation to all trade union political funds in Great Britain was in excess of £24 million and £20 million respectively.
We have debated at length the principle of these rights for union members. The Select Committee which assessed our proposals also assessed the extent to which unions, in practice, were transparent with their members about the existing choice to opt out of contributing to their union’s political fund. The Select Committee concluded that there is significant variation in how different unions convey opt-out information to their members. The Government’s analysis of online union subscription forms, the point at which an individual makes their first financial commitment to their union, found that nearly half of unions that have a political fund make no mention of its existence. Following the Select Committee’s recommendations and an amendment tabled by the noble Lord, Lord Burns, we listened to the arguments and accepted the substance of his amendment. The Trade Union Act incorporates the Select Committee’s recommendations that the requirement to opt in will not apply to existing members; only new members will be required to opt in to a political fund, and they will be reminded annually of their right to opt out. Further, we agreed that opting in or out will be allowed electronically, and that there should be a minimum 12-month transition period to enable system changes to made, and which the Government should consult unions on. The noble Lord, Lord Burns, welcomed this outcome and said he regarded it as “a very satisfactory conclusion”.
As required by the Act, we consulted the TUC, 24 unions with political funds and the Certification Officer, seeking their views on the length of the transition period. A number of technical and administrative issues were raised during the consultation. These included the request for the Certification Office to develop what was called, “model rules”, which would allow unions to make the relevant changes to their systems, the need to allow an appropriate period for unions to amend their rulebooks and the requirement to make a number of changes to IT systems and administrative procedures. Having considered these issues, balanced against a need to reform and modernise trade union business, the Government have decided to set an extensive transition period of 12 months, as set out in the regulations laid before the House today. We believe a 12 month transition period is adequate for unions to ensure that they comply with the statutory requirement under the Trade Union Act. This balances the need to provide unions with sufficient time to implement the changes with the Government’s desire that the measures are delivered promptly. It is proposed, therefore, that once the regulations have received parliamentary approval, they will come into force on 1 March, and the 12-month transition period will run from that date.
The Government’s view is that unions have known about these changes for some time, and it is not unreasonable to expect them already to have done some planning to meet that requirement. We are also grateful to the Certification Officer, who has consulted unions and issued model rules and guidance, which will assist them in complying with the new requirements.
Before I conclude, I should like to address comments made on these regulations by the Secondary Legislation Scrutiny Committee. In relation to the five regulations on the 40% threshold, the committee pointed out that the Government had committed to issue guidance to clarify which workers will be captured by each of the important public services listed, to assist unions and employers when they are assessing how a ballot should be conducted. The committee’s view was that the need for such guidance raises the question of whether the regulations are sufficiently clear and understandable for those affected. Furthermore, the committee regretted the fact that the Government had failed to publish this guidance in early December when they laid these draft regulations in Parliament.
In response, I am grateful for the committee’s scrutiny. I can confirm that the Government have now published guidance to provide advice for unions on applying the 40% threshold in practice, and on examples of workers who will be covered by each of the regulations. In drafting this guidance, we engaged with key stakeholders affected by the provisions to understand how the guidance can be most helpful. We listened carefully to their views and have reflected these in the guidance. I would add that issuing guidance is not unusual. The Government frequently make guidance available to summarise legislation and its requirements, and to provide advice on their application in practice.
In relation to the political funds transition period regulations, the committee noted that the Government had not yet published a summary of responses to their consultation with unions and the Certification Officer on the length of the transition period. I apologise that we were unable to publish a summary of responses when these regulations were laid. We accept that we should have done so. As advised by the committee that it is best practice to publish a summary of consultation responses, we have now published a summary on GOV.UK.
In conclusion, the Government believe that the regulations before noble Lords today are proportionate and strike the correct balance between the interests of unions and members of the public. I beg to move.
The Government have considerable power over important public services, but they fail to meet, by a huge margin, the 40% threshold that they are imposing on the same public services for actions that their Members wish to take. I note with great interest that in the Explanatory Memorandum we have been provided with for this evening’s debate is the claim:
“The thresholds will restore a level of democratic legitimacy to industrial action ballots, ensuring that the public have confidence that any disruption they face as a result of strike action has a strong democratic mandate from union members”.
Then we must assume, on that basis, that the Government accept that they do not have a strong mandate for the actions they are taking. How does that 40% threshold approach square with the EU referendum result? Are the Government not admitting that their hard Brexit proposals lack democratic legitimacy and cannot have public confidence when only 37.4% of all eligible voters backed Brexit, whether soft or hard? Again, the 40% threshold was missed.
The Minister has rightly commented on your Lordships’ Secondary Legislation Scrutiny Committee’s concerns about the failure to publish guidance in early December. I am sure that the House will acknowledge the apology which the Minister has given, but it is very much to be regretted that that was not done. The committee also made very clear that the need to provide that guidance indicated that the primary legislation was unclear. But nothing in this set of regulations or the accompanying Explanatory Memorandum has helped persuade us that what we said during the passage of the Bill was wrong. We remain of the view that the Government are quite simply wrong themselves to impose this 40% limit.
The final regulation on the list, relating to the transition period for the imposition of new rules on trade union political funding, is different, and we are very concerned about what is proposed. We were critical of the whole set of measures around this aspect of the Bill, believing that party-political funding should be addressed in the round, not looking at just one aspect of it that relates to the funding of one particular political party. We were pleased that the Government accepted an amendment requiring a transition period of at least 12 months and consultation with all trade unions that have a political fund, but it is about the results of that consultation I want to press the Minister. It is not at all clear that that consultation was meaningful. As he said, the end of the consultation is planned to be 1 March 2018. He claimed that that will allow the trade unions to make the necessary changes. He said that it was an appropriate and adequate time period, yet the Government will know, since it is referred to very clearly in their own summary of trade union responses to the consultation, that many of the affected unions have their conferences—the time at which they can change their rules—scheduled for April and May of 2018, which is after the deadline that the Government are imposing. USDAW, for example, writes:
“This begs the question: why are the Government rushing to implement legislation just a few weeks before unions are due to hold their conferences to change their rules to comply with the legislation? By rushing into legislation, without giving USDAW (and other unions) time to abide by our own rules, Government are forcing USDAW into a situation where we either need to break our own rule book—laying us open to challenge from our members—or not to abide by the legislation”.
I am sure that the Minister will respond by saying that the unions have known about this legislation for some time, that they have had time to prepare and therefore it is perfectly reasonable. But to do so will mean significant changes to the arrangements—changes to the times when they will have their major conferences, for example. The Minister knows how expensive it is to run the Conservative Party conference. He knows how difficult it would be to change the date of that conference, let alone to be able to find a venue. He will of course be aware that his friend in another place—the Minister, Mr Nick Boles—said very specifically that no measures should be taken that will prevent them being “successful for them” and certainly not,
“punishing in terms of cost”.
While we have considerable concerns about the new funding rules, I hope the Minister will at least accept that—to meet Nick Boles’s commitment that there should be successful transformation by the trade unions to these new measures, which many people do not like anyway, and that it should be done at no significant cost to them—there is a real requirement to extend the transition period, at least by six months. I look forward to hearing the Minister’s response.
USDAW, a union which gave oral and written evidence to the Select Committee—I think even the committee’s Conservative members were quite impressed by how it dealt with opting out of political funds under the present arrangements—wishes to abide by the law but also to abide by its rules. The Government’s proposition presents it with a dilemma which will be difficult to overcome. I plead with the Minister to think again on this regulation and extend the period, if it has to be triggered in March, to 18 months or to trigger the one-year period later in the year, if that is indeed what the Government want.
I had hoped that after the furore during the passage of what became the Trade Union Act, we would settle down to implement it in a sensible way. This regulation is not a sensible way. It will put unions that wish to comply with the law into difficulties and I request that the Minister thinks again. Indeed, his failure to provide in time the results of the consultation give me cause to support the views of the Delegated Powers Committee that the Government have acted entirely out of order on this basis.
However, there is a bigger point here. The first conclusion of the Select Committee, unanimously, was that while the Bill dealt with union political funds, and therefore in the nature of history and the structure of our political arrangements hit the finances of only one party, there should be a government initiative to look at political funding in general. It should look at all institutions and sources of funding which come to political parties. That put the responsibility not on the political parties themselves but on the Government. All of us were concerned that Ministers at that time refused to recognise and carry out what was in the Conservative Party manifesto: that a review of political funding should take place.
Leaving aside the money that goes from rich individuals, more money goes from other institutions into political parties than from trade unions. Yet none of those other institutions, whether they are public or private companies, partnerships or whatever, are required to have a separate political fund—let alone to have any detailed requirements on opting in and opting out on review, and repeating that exercise every five years. Only the trade unions are already subject to that restriction, as they have been since 1913. Other institutions actually provide more money to a range of political parties, including the Labour Party, through their own decisions simply to donate money to them. In the case of quoted companies, there has to be a vote but there is no requirement to have a separate political fund.
This has always been a hugely partisan measure to hit at the finances of the major opposition party. It is being made even worse by the detailed provisions in this regulation, in that unions will find it difficult to comply with it in the short term. The bigger question, which Ministers were pressed to answer a few weeks ago in this House, is: when are the Government going to have a ‘look at political parties’ funding, across the board, on a fair, reasonable and equitable basis? Until they do, they cannot pretend that this is a sensible, democratic or reasonable measure and I hope that the Minister can at least give us an inkling today of the way in which his colleagues will approach this before this Parliament is out.
The reputation of political parties and the whole political process depends on us cleaning it up. The Government think they have cleaned up the trade union contribution to the Labour Party to some extent but there is a much deeper and wider problem than this. It is about time the body politic as a whole addressed it. I hope the Minister can tell us that, at least, he and his colleagues are preparing to address it. If not, then once again we are at an impasse. This has been exposed as a hugely partisan, unilateral decision by one political party to try to bankrupt another.
Unions have always been careful in taking industrial action not to put people at risk or to take that action lightly. It is always a matter of last resort. Indeed, trade unions and trade union institutions have been able to look at making better mechanisms to try to create resolution—for example, the most recent TUC initiative. However, there are problems that need to be addressed. If we just look at the recent problems of workers in warehouses, be it for Sports Direct or Amazon, or even some of the reports today about a series of companies paying workers consistently under the living wage, we see that we have a problem here. Those strong and important institutions are constantly undermined. We need greater participation in trade unions and we need balancing measures to ensure participation in ballots.
I am hugely irritated at the massive lack of evidence to justify wide-ranging restrictions on the right to strike. I am deeply concerned that the Minister even referred to the nonsense that went on in another place about trying to impose even more conditions. This is the UK equivalent of Kellyanne Conway’s “alternative facts” when talking about the number of people on the mall at President Trump’s inauguration. This is just ridiculous. These are flights of fancy.
I take issue with the notion that rebalancing rights of the public and all the things to which Ministers referred requires an 80% mandate—a Kim Jong-un-style mandate. This is not the case. The number of days lost to industrial action per year has fallen dramatically over the last 30 years. In 2015, there were only 116 stoppages as result of industrial action, 52% of stoppages taking place in the private sector, 48% in the public sector. In an economy with over 30 million people in employment, this is low. The level of disruption caused is limited. Much is short-lived. Some 60% of stoppages lasted for one, two or three days. Consistent findings have shown low numbers of managers—I think in one of the last surveys it was only 3%—reporting any disruption as a result of strikes in a workplace.
Union members take industrial action to defend their jobs and pay and conditions, not for political reasons. In 2015, 93% of working days were lost to disputes about pay, working time or redundancies. Indeed, in the vast majority of cases where the union ballots for industrial action, disputes are settled without the need for that action. In 2015 there were 503 ballots supporting strike action but just 116 stoppages.
I am very concerned. The impact assessment that accompanied the Trade Union Act predicted that the threshold for industrial action would reduce strikes by some 40% but did not analyse in any detail the nature of those strikes. Noble Lords have made the point before that if you want to entrench a strike and cause it to last longer, you want to motivate more people to vote in higher numbers. If you want to be sure of turning more disputes into strikes, this is exactly the way to go about it. That is a huge error. The Minister should give careful attention to ensuring that the Government look at the impact of this. The Bill was helped by the Select Committee, which did well to look at analysis by behavioural economists who were able to understand what the impacts were. These measures could also benefit from that. I hope that the Minister will consider that.
The Government have effectively introduced provisions that prohibit strikes in a number of cases where ILO standards suggest that they must put in place some compensatory mechanisms to ensure that workers are not disadvantaged by the loss of their right to withdraw their labour. There is no indication of the Government doing so. There is no indication of fulfilling the undertakings given in this House. We do not find this completely acceptable.
If we turn to the House of Lords Secondary Legislation Scrutiny Committee report—we acknowledge that the Minister has apologised; we are grateful for his coming to the House to give that apology—we see that the guidance is not clear. There are issues about what constitutes an important public service. There is a grey area where trade unions are invited to make a pitch to work it out—replete with all the attendant risks of court action—against the spirit and principles of the agreement we had that the Government would make it as clear as possible.
The Trades Union Congress recognised that limited improvements were made to the wording and scope of the regulations following consultation, but we are deeply concerned that the double threshold will constrain the rights of millions to exercise their right to vote. There are anomalies in the list of workers. One has been mentioned: why bus services in London but nowhere else? What concerns me more is the extension to the further education sector, because the Government are currently looking to ensure through legislation that further education colleges can go bust, which presages that the Bill to be debated here shortly may lead to terrible consequences about which the Government are not being entirely honest. I do not hold the Minister accountable for that; I hold him to account for many things, but not for the Government’s intentions in the further education sector. I should be grateful if he could give us any details that he has about that.
In the area of transport, the regulations mention station staff, guards or conductors—those people whom management can fire without any real recourse. They are the people in an important public service who are unable to withdraw their labour in those circumstances. It is ridiculous that that is where these provisions have ended up. Will the Government look at this again?
I make one particular point about the impact of the provisions. As was clearly outlined during the Act’s passage through this House, it will have a disproportionate impact on women. Research suggests that in some of these areas nearly 70% of trade union members working in these important public services are women. Many of these groups will fall into low-income bands and experience less favourable wages and conditions compared to their male counterparts. They are likely to be numerically disadvantaged by the changes and fall within the groups most in need of strong, effective representation. The weak bargaining position of an already disadvantaged group reinforces the argument for some compensatory measures. I should be very grateful if the Minister could identify whether any are forthcoming.
I turn to the trade union provisions relating to the political fund. I am grateful to my noble friend Lord Whitty for making the broader point about the context in which they have to be seen. There is a tremendous problem here. The noble Lord, Lord Foster, adequately set out what was the Government’s position when we settled this—apart from their acceptance of the provisions in the Select Committee report. There was a specific undertaking by the then Minister, Nick Boles, who wanted,
“to make sure that the transition from the pre-existing approach to a modern approach of opt-in is possible for the unions to do in a way that is successful for them and their members and not punishing in terms of costs”,
and said that the arrangements were,
“not designed to trip people up”.
The provisions here are specifically designed to trip people up. There is no other way to interpret how these measures are meant to be implemented.
It is clear that there is a strong view among those who have been following these matters that the proposed 12-month transition period is inadequate and fails to take into account the complexity involved in making the changes required. It puts unions in a terrible dilemma: not only will they have to choose between following their rules, absorbing the costs and following the law, but it makes their passage of the regulations even more difficult. Most unions will have to go outside their own rules, setting up conflicts within unions. This sets up the potential, as we have seen, for someone to cause difficulties in many different ways by using the law against unions attempting to adhere to it. That is absolutely ridiculous. There has to be an understanding not just of the complexity of the task that has been laid upon trade unions of implementing the entire Trade Union Act over this period, but of what they must do to revise their rulebooks and undertake all the administrative and other changes necessary.
I was particularly disappointed about the matter, raised by the legislative committee, of the consultation not being published. However, reading the consultation adequately makes the points. The Minister made a very good point when he said that unions knew this was happening and must have made plans and started to make provisions. That is absolutely true. They made plans and should be held to account for them and for their ability to tell someone what took place. But these plans were ignored. The consultation states the timetable the unions gave as a consensus but the provisions do not fit in with it. It states very clearly:
“Unions said they have conferences scheduled for April/May 2018”.
What has happened is absurd. Unions made provision; they told the Government what their requirements were and were ignored.
The consultation reports, moreover, that the Certification Officer,
“did not give a view on the specific timeframe for the transition period”,
nor for the new model rules. It then says:
“As the majority of unions will be submitting their own draft rules to the CO at around the same time the CO will require sufficient time to manage the approval process”,
without even specifying a time. This is setting up the unions to fail and is wrong in practice and in principle; it is a huge breach.
One just has to look at USDAW, which has put a very detailed case together to show how it may be able to implement these regulations within a proper timeframe. It falls outside these provisions. Unfortunately, I do not understand how the Government came to the view that this was how to implement the Trade Union Act. I hope the Minister is able to address these issues because I am sure that things can be done. It is certainly possible to direct the CO to look at different ways forward and to put a schedule together that identifies when unions will adequately be able to cover their obligations while following the rules. It is possible to do this using measures that can supersede or overlay the statutory instruments. I will be very grateful if the Minister can give us an undertaking tonight that he will not put unions in such an invidious position.
The 40% threshold has been debated to death in this House. I appreciate the concerns that have been raised: it is a stringent test. I described it as a robust threshold, which it is because it directly affects particularly vulnerable people. The workers to whom this threshold applies are fairly well defined in the Act. For example, it is not all people who work in the NHS; it is people who work in maternity units, A&E departments or high-dependency units. We have deliberately tried to structure it so that it impacts only on those who are looking after particularly vulnerable people.
The noble Lord, Lord Kerslake, said that it was, on the whole, a fair package and it is. He and the noble Lord, Lord Stoneham, raised the issue of electronic balloting. In November, the Government announced that Sir Ken Knight, the former Chief Fire and Rescue Adviser for England, will lead an independent review of electronic voting for industrial action ballots. The final report will be presented to the Secretary of State and laid before each House of Parliament no later than December of this year. So there will be an independent review, though I appreciate it is not as soon as some noble Lords would like.
I shall resist the temptation to be drawn into a debate with the noble Lord, Lord Whitty on political funds.