Mr Henry Bellingham (North West Norfolk, Conservative)

I beg to move amendment No. 54, in

clause 30, page 26, line 32, leave out subsection (4).

The clause is important because it is about extending rights to flexible workers. Subsection (4) allows an exemption to the one-year qualifying period of continuous employment for claims for unfair dismissal. Will the Minister clarify something? In the review of the Employment Relations Act 1999—a consultative process was obviously ongoing—what sort of representations did he receive from trade

unions and other bodies pushing for a shortening of the period of qualification? I had a look at the review paper and could see no mention of substantial representations to have the period shortened.

Mr Gerry Sutcliffe (Parliamentary Under-Secretary (Employment Relations, Competition and Consumers), Department of Trade and Industry; Bradford South, Labour)

It may help the hon. Gentleman in the course of his argument if I say that the trade union side wanted to reduce the qualifying period from 12 months. Clearly, there was resistance to that from employers. There are issues surrounding other rights that individuals get, in relation to which the period of 52 weeks does not come into play.

Mr Henry Bellingham (North West Norfolk, Conservative)

I am grateful to the Minister for clarifying that point and explaining that there was a submission by the trade unions, because, in the documents that I looked at, there was not much mention of that. Will he tell us which trade unions were responsible for the submissions and the essence of their argument?

I am concerned about another point. Subsection (4) adds section 104C of the Employment Rights Act 1996 to the list. To qualify for the right to request flexible working, an employee need only have 26 weeks of continuous employment. I am not clear whether the right to flexible contracts comes into this at all. The Government have recently given employees the right to flexible working, or is that a totally separate matter? If it is a separate matter, are the Government saying that they are going to reduce the one-year qualifying period for flexible workers to 26 weeks simply because they feel that those flexible employees deserve more rights? If that is the case, I submit that it is not necessarily fair on many small and medium-sized enterprises and will lead to a greater burden on them.

That point has been debated on several occasions in this Committee. Conservative Members generally support much of what is in the Bill, but every now and again one comes across a provision that will make life more difficult for SMEs. Are employees pushing hard to have flexible working rights extended? Do they expect such rights to come into play after only 26 weeks? Employees have known for a long time that after one year they collect the full array of rights; that is something that we all support. Unless the Minister can convince me otherwise, it appears that changing the period to 26 weeks is not being introduced on the basis of substantial representation. I would like to know exactly which trade unions have been involved and exactly how the consultation took place.

The clause proposes a substantial extension of rights. We support the bulk of the clause, but we are not happy with subsection (4). That is why we tabled the amendment. We are concerned about extra burdens being put on SMEs, which the clause undoubtedly will do. There will be extra stress and strain for a substantial number of companies if rights are claimed in cases of a breakdown in relations between the employer and the employee. That is the essence of the amendment.

Mr Jonathan Djanogly (Huntingdon, Conservative)

The Minister said that I had been consistent in my approach. He will have no less from me on this amendment.

Mr Gerry Sutcliffe (Parliamentary Under-Secretary (Employment Relations, Competition and Consumers), Department of Trade and Industry; Bradford South, Labour)

So no surprises?

Mr Jonathan Djanogly (Huntingdon, Conservative)

As he says, he will not be surprised.

This is another clause that increases the burden of regulation on business. In this case, the qualifying period of one year's continuous employment is reduced to 26 weeks for making an unfair dismissal claim in respect of the right to request flexible working. That must be put in the context of what has happened with unfair dismissal. The Government have reduced the two-year qualifying period to one year, increased the maximum award available and included part-time workers. They are now stretching unfair dismissal to requests for flexible work. The changes have been introduced through separate legislation, one by one, and the ratchet is turned again in this case. It raises the question of what is next in line for unfair dismissal. One has the feeling that this is not the end of the matter.

Mrs Anne Picking (East Lothian, Labour)

The picture that the hon. Gentleman paints once again is that everything is stacked against the employer. The clause is about giving an employee a basic right to defend a case if they feel that they have been unfairly dismissed. The employer has the same right to defend their case. My view is that employees should have that right from day one, not after one year.

Mr Jonathan Djanogly (Huntingdon, Conservative)

The hon. Lady makes her point. Ultimately, the question comes down to what is unfair. It must be put in the context of what is fair in respect of managers being able to manage their businesses. That is a political argument on which, clearly, we have differing views.

I am not entirely sure why the requirement on flexible working applications has been introduced. That was referred to by my hon. Friend the Member for North-West Norfolk. What is actually behind it? If the Minister could elaborate on that, it would be of interest to the Committee. Are the Government trying to encourage flexible working as a policy objective? If so, how do they believe that that will be the outcome if employers are simply forced to recognise it? I do not see one leading to the other.

Why should workers who request flexible working be given more rights than full-time workers? That does not seem to follow either; it would be prejudicial to full-time workers. It seems to point towards the fact that, next year, full-time workers will have 26 weeks in the unfair dismissal process, rather than one year. That is a matter for next year, but in the mean time, I would be grateful if the Minister addressed those issues.

Mr Bill Tynan (Hamilton South, Labour)

I welcome the measures in the clause because they strengthen the provisions relating to unfair dismissal for those who take advantage of their statutory right to flexible working. The existing legislation contains a number of limitations on those wishing to enforce their rights and the changes would reduce that number.

I believe in fairness, justice and the opportunity for protection where possible. I remember when the two-year industrial tribunal qualification was introduced. Some employers took the opportunity to employ people for two years and pay them off a week before the two years were up in order to rehire them on a new contract. That was completely unfair. I would be interested to know whether the clause will remove the upper-age limit for flexible working. Does it reduce the qualifying period—I hope it does—to 26 weeks for flexible working, and does it provide protection in cases of redundancy and industrial action?

Mr Gerry Sutcliffe (Parliamentary Under-Secretary (Employment Relations, Competition and Consumers), Department of Trade and Industry; Bradford South, Labour)

This has been a useful debate and shows the difference between the Government's approach and that of the Conservatives. There has been a failure to understand what we are trying to achieve in the clause. Hon. Members will know that, last April, the Government introduced a new law giving working parents with children under the age of six, and parents with disabled children under the age of 18, the right to request flexible working and placed a duty on employers to consider such requests seriously.

Subsection (4) addresses an omission in the original drafting of the law. It delivers the policy intention of the Government and the work and parents taskforce that designed the law. Small businesses also saw the business case for the provision.

Subsection (4) adds the flexible working law to the list contained in section 108(3) of the Employment Rights Act 1996 detailing exemptions to the requirement of one year's qualifying service before bringing a claim for unfair dismissal. The addition is appropriate, because the eligibility criteria for the flexible working law refer to 26 weeks' continuous service, not 52. That approach is consistent with other employment laws where the qualifying period is less than 52 weeks, such as those dealing with maternity and paternity leave.

If we did not add flexible working to the exemption list, as suggested in the Opposition's amendment, a proportion of parents would be exercising their statutory right without full protection from unfair dismissal—a point raised by my hon. Friend the Member for East Lothian (Anne Picking). Without the protection provided by the subsection, employees who have qualifying service of more than 26 weeks, but less than one year can face dismissal on account of the likelihood of their making an application, as well as their making the request. That goes against the original intention of the legislation, and it would not deliver the recommendations of the work and parents taskforce that we should give employees greater confidence to make requests and engage in dialogue to find an outcome suitable for both employer and employee.

I fully recognise that most employers know the benefits of flexible working and pursue policies that value their staff, thus maximising the potential of their organisation. However, if we do not address the issue through legislation there is scope for a loophole to be exploited. We have a duty to ensure that employees

who are eligible for a statutory right are able to exercise such a right in the knowledge that they cannot be dismissed unfairly.

The approach of Opposition Members suggests that there is a hidden agenda in the Bill to reduce the 52-week qualifying period. During the consultation process, trade unions—particularly through the Trades Union Congress—pushed for day-one rights. Some hon. Friends stated that they agreed with that. The Government do not see it as being appropriate at this stage. There are already provisions for a lesser period than 52 weeks in certain cases, such as maternity and paternity leave. We think that it is only fair, in this case, where an employee has been unfairly dismissed, that they have the right to a 26-week qualifying period. It is appropriate in this case.

The whole issue around flexible working and work-life balance reflects the changing nature of the work force today. I was happy, a few weeks ago, to present the parents at work awards, where employers were rewarded for enabling flexible working among their employees. Every employer who came to the podium to accept an award said that they could make a business case for flexible working, which values employees and retains the skills that businesses need. Opposition Members see things through different coloured spectacles from the rest of us, in terms of how modern employment relations needs to move forward. This amendment is entirely inappropriate and I hope that the hon. Member for North-West Norfolk will withdraw it.

Mr Henry Bellingham (North West Norfolk, Conservative)

I agree with what the Minister said about the work-life balance agenda, although we take issue with him on parts of it. There is no question but that the vast majority of good businesses will do their level best to ensure that they get the most out of their employees, and that it is a genuine partnership. No business can succeed unless it is a partnership. Ensuring that employees are happy, and that everything about their commitment to that company is as harmonious as possible, will result in them making

a bigger commitment to that company in terms of the work that they do. We agree with the Minister on that. I applaud him for attending the awards ceremony, and I hope that he will attend many more such ceremonies.

There are a couple of points on which I seek further clarification. Regarding section 104C of the Employment Rights Act, I could not find the section in the original statute. Will the Minister tell us which subsequent legislation added that section? He addressed my point about the new legislation regarding the right to flexible contracts. Is he saying that the legislation we now have giving certain employees the right to request flexible contracts has resulted in the reduction in the one-year qualifying period? If that is the case, I would be slightly more sympathetic, and if he can confirm that I would seek the Committee's leave to withdraw the amendment.

Mr Gerry Sutcliffe (Parliamentary Under-Secretary (Employment Relations, Competition and Consumers), Department of Trade and Industry; Bradford South, Labour)

I reassure the hon. Gentleman that this is the case. That is why the 26 weeks provision is there. It is the right to ask for flexible working—the employer retains the right to refuse that request if it is, in his view, detrimental to the business. It is about trying to ensure that there is a satisfactory joint arrangement whereby both employer and employee benefit. The section that he quoted is from the Employment Act 2002.

I forgot to answer the point raised by my hon. Friend the Member for Hamilton, South (Mr. Tynan). Subsection (5) ensures that there is no upper age limit preventing unfair dismissal claims based on flexible working. With that, I ask the hon. Member for North-West Norfolk to withdraw his amendment.

Mr Henry Bellingham (North West Norfolk, Conservative)

I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 30 ordered to stand part of the Bill.

Further consideration adjourned.—[Charlotte Atkins.]

Adjourned accordingly at twenty-one minutes to Eleven o'clock till Tuesday 24 February at half-past Nine o'clock.