New Clause 4

Employment Bill [Lords] – in a Public Bill Committee at 3:00 pm on 16 October 2008.

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Fair Employment Commission

‘(1) The Secretary of State shall appoint a body, to be known as “the Fair Employment Commission”, to discharge the functions conferred or imposed on the Fair Employment Commission under this section.

(2) The Secretary of State may refer the matters specified in subsection (3) to the Commission for their consideration.

(3) Those matters are—

(a) the operation of the National Minimum Wage Act 1998;

(b) the operation of the Employment Agencies Act 1973;

(c) the operation of the Health and Safety at Work Act 1974;

(d) the operation of the Gangmasters (Licensing) Act 2004; and

(e) such matters relating to this Act as the Secretary of State thinks fit.

(4) In considering the matters specified in subsection (3) the Commission may carry out such inspections of workplaces as it considers necessary.

(5) Where matters are referred to the Commission under subsection (3) above, the Commission shall, after considering those matters, make a report to the Secretary of State which shall contain the Commission’s recommendations about each of those matters.’.—[John Hemming.]

Brought up, and read the First time.

Photo of John Hemming John Hemming Liberal Democrat, Birmingham, Yardley

I beg to move, That the clause be read a Second time.

This is another probing provision, which looks at having a body where the various stakeholders—as is now the phrase—can argue their case so that the law can be kept in view. I am interested in hearing the Minister’s views on that.

Photo of Jonathan Djanogly Jonathan Djanogly Shadow Minister (Business, Innovation and Skills), Shadow Solicitor General, Shadow Minister (Justice), Shadow Solicitor General

The hon. Gentleman said that this was a probing provision. I have two concerns about it. First, the emphasis once again seems to be on a new body to deal with problems of enforcement, and I fear that that might create undue costs for not enough benefit. The Bill already contains provisions to strengthen the investigative powers of the employment agency standards inspectorate in enforcing the Employment Agencies Act 1973 and related regulations, including powers to allow EAS inspectors to demand and secure copies of financial information from an agency or suspect directly, or from their bank or building society. I suggest that we give some time at least for those provisions to bed in and take effect, and that we then review the effectiveness of what we have done in this Bill, rather than too quickly forming a new body with sweeping powers of investigation.

My second concern is that a balance must be maintained between the freedom of business to go unhindered by arbitrary state intervention and that of the individual to fully enjoy the rights afforded to him by law. I am concerned that such a balance is not achieved by the new clause, and that we would simply be creating another body and yet more red tape.

Photo of Pat McFadden Pat McFadden Minister of State (Department for Business, Enterprise and Regulatory Reform) (Employment Relations and Postal Affairs), Member, Labour Party National Executive Committee

The idea of a fair employment commission was suggested in a report published by the TUC earlier this year. It had established a body called the commission on vulnerable employment, which looked into this whole area, and that idea was one of its recommendations. The issue is what we mean by such a body, and whether we mean the combination of all the agencies covered by new clause 4. The issue of the closer co-ordination of the enforcement agencies has been raised with the Government. I am certainly committed to such co-ordination; it is in the interests of vulnerable workers, reputable business and the taxpayer. The question is whether we need to bring all the agencies together in one body. I am not sure that that would be the most effective way to proceed.

What the Government have agreed to do is to set up a board—the fair employment enforcement board—which will bring together all the agencies to ensure that they can co-ordinate their work and that we get the best value for money from the taxpayer, and also to deal with some of the silo issues that we have discussed. Representatives of the TUC, the CBI and the Federation of Small Businesses will also be on the board, because it is important that we hear the views of both employees and business as we discuss enforcement. My experience is that when it comes to proper enforcement, the CBI and the TUC often agree—they both have a great interest in strong and effective enforcement.

The board’s work will focus on helping vulnerable workers and their employers by improving enforcement, raising awareness of employment rights, and so on. The board will meet for the first time next month, and its key focus will be to oversee delivery of the key measures in the vulnerable workers forum report, which was published a few months ago. Those measures include the development of plans to pilot a single enforcement  helpline and a review of the strategies for taking forward a sustained campaign to raise awareness of basic rights and to encourage reporting of abuses. I am all for closer co-ordination but I am not sure that it is necessary to have a single enforcement body as the clause implies. Putting that together could absorb a great deal of institutional energy rather than doing the job for which the enforcement bodies were set up. That will be what the new board tries to take forward rather than the picture painted in the new clause. This is again about transferring more of the burden for navigating the system from the vulnerable workers themselves to the Government.

I appreciate where the hon. Member for Birmingham, Yardley is coming from, but closer co-ordination, better working together and better value for money are probably a better route than full merger or the creation of a single commission. We have gone some way towards achieving that and I hope that it will be effective.

Photo of John Hemming John Hemming Liberal Democrat, Birmingham, Yardley

I am slightly surprised by the hon. Member for Huntingdon wanting to maintain four quangos when we are suggesting having only one, but if the Conservatives now want to increase the number of quangos, that is their choice.

It is quite clear that the direction of travel is towards greater co-ordination and I would not be surprised, from what the Minister is saying, if that is the result after time. I see no merit in dividing the Committee on this. I beg to ask leave to withdraw the motion.

Motion and clause, by leave, withdrawn.