Clause 5
Employment Bill [Lords]
11:45 am
Pat McFadden (Minister of State (Employment Relations and Postal Affairs), Department for Business, Enterprise & Regulatory Reform; Wolverhampton South East, Labour)
Clause 5 brings us on to the duties and powers of ACAS. At present, ACAS has a duty—I stress that word, “duty”—in certain circumstances to conciliate in cases where no claim has been presented. The effect of the clause will be to change that duty to a power.
It may be helpful to explain the context of this change, which is an important underpinning element of our package of changes to the dispute resolution system. As we have heard throughout this morning, ACAS has a good record of achieving settlement in the period after a claim is made to an employment tribunal but before the process of the tribunal hearing. Currently, it also has a duty to offer conciliation in certain cases that are capable of becoming the subject of an employment tribunal claim where both parties request it, or where one party makes a request and the conciliation officer judges that there is a good prospect of success.
This duty is not new; it has been on the statute book since the 1970s. However, during the 1980s in particular ACAS found that some employers were using this pre-claim conciliation duty simply to obtain an ACAS settlement, as the basis for a legally-binding agreement to underpin severance arrangements that had already been agreed without the involvement of ACAS. Also, the nature of the duty on ACAS to provide conciliation was such that it could lead to ACAS being asked to assist with cases that were never likely to become the subject of an employment tribunal claim, at the taxpayer’s expense. That was not the intention of the duty.
In response, the ACAS council decided that conciliators should interpret the duty strictly in the spirit that was intended, so that the pre-claim conciliation service would be focused on cases that were otherwise more or less certain to become the subject of a tribunal claim. In turn, that had the consequence that ACAS steered away from actively promoting this service, even though it could be valuable. The number of pre-claim conciliations carried out since has been small; it has run at around 1,000 a year in recent years, making up less than 2 per cent. of the conciliation activity of ACAS.
The Government see clear benefits in making the conciliation services of ACAS more widely available in disputes that have not yet reached the stage of a tribunal claim but are likely to do so; making that change is an integral part of these reforms. If a dispute can be resolved before the parties set out their positions in a formal and legal way, that can save considerable time and costs for all concerned. A total of 85 per cent. of respondents to the consultation following the Gibbons review supported the proposal that ACAS should be given additional resources to provide such services.
I have already referred to the additional resources that the Government are making available to ACAS in order to achieve that aim. Those resources are considerable. However, we also think that it is appropriate to give ACAS the power to target properly pre-claim conciliation on those cases where it thinks that it can make the most difference and be the most valuable. That is really the purpose of the clause.
It will then be open to the parties in such cases to decide whether to use the service. Regardless of whether the parties take advantage of this pre-claim conciliation, if the dispute subsequently turns into a tribunal claim they will still have access to ACAS conciliation services in the post-claim period, in the usual way.
In short, we are trying to ensure that ACAS is able to manage effectively the new case load that we wish it to take on, without having to restrict the use of its services unduly and without having to transfer resources from other parts of its operation into an area where it has a duty to respond to every request. So we want more pre-claim conciliation; we have given ACAS more resources to achieve that, and we also want to give ACAS the power to use its discretion to apply those resources where they would be best used. That is the purpose of the clause.