‘(1) The Gangmasters (Licensing) Act 2004 is amended as follows.
(2) After Section 3(1)(c) insert—
“(d) construction work undertaken by EEA or Swiss nationals;
(e) cleaning work undertaken by EEA or Swiss nationals;
(f) care work undertaken by EEA or Swiss nationals;
(g) hospitality work undertaken by EEA or Swiss nationals.”
(3) After Section 3(2) insert—
“(2A) In subsection 1 above—
(a) “construction work” means work in the construction industry;
(b) “cleaning work” means work as a cleaner;
(c) “care work” means work as a carer;
(d) “hospitality work” means work in the hospitality and services sector.”
(4) After Section 4(5)(c) insert—
“(d) using or employing EEA or Swiss nationals to undertake construction work;
(e) using or employing EEA or Swiss nationals to undertake commercial cleaning activities;
(f) using or employing EEA or Swiss nationals to undertake care work;
I beg to move, That the clause be read a Second time.
The new clause would extend the licensing standards of the Gangmasters and Labour Abuse Authority to more sectors. As with the new clauses that we discussed a few moments ago, I am grateful to Focus on Labour Exploitation for its help with drafting.
Currently, the GLAA licenses four sectors: agriculture, horticulture, shellfish gathering and any associated processing and packaging. The new clause would extend its licensing remit to construction, cleaning, care and hospitality. I am moving the new clause against a backdrop of Government plans for short-term work visas following the ending of free movement, as set out in the immigration White Paper, and out of concern to ensure that there is protection from exploitation for potentially vulnerable workers in sectors that have traditionally relied on migrant labour.
As members of the Committee will know, the GLAA was established in the wake of the Morecambe Bay tragedy in 2004, originally as the Gangmasters Licensing Authority. Under the Immigration Act 2016, it was renamed and its remit was increased to give it police-style powers across the labour market. Anyone who supplies labour—so-called gangmasters—to the specified sectors must have a licence and it is a criminal offence to do so without one. A licence can be granted to any kind of legal entity, such as an individual, a company or a partnership.
Licensing standards include provisions on the payment of taxes, the payment of national minimum wage rates, the prevention of physical and mental mistreatment, and the restriction of a worker’s movement through debt bondage, threats or the retention of ID documents. Licensing is a crucial tool for preventing human trafficking and modern slavery.
The system is widely regarded as effective in monitoring labour providers in the sectors covered and in detecting cases of abuse and exploitation. It has raised employment standards, protected vulnerable workers from exploitation and prevented rogue labour providers from gaining an unfair advantage over legitimate businesses. It is strongly supported by retailers, labour market providers, food manufacturers, trade unions and charities that represent victims of exploitation. The Association of Labour Providers’ biennial survey in 2015 showed that 93% of labour providers surveyed were in favour of licensing.
The purpose of the new clause is to extend that successful licensing regime to four additional sectors in the light of a likely increase in the use of short-term labour in sectors that have traditionally been dependent on migrant labour. I stress that the majority of employers will not be exploitative. Indeed, good employers will welcome measures that prevent unscrupulous employers from damaging the reputation of their industries and from undercutting those who do not take advantage of vulnerable workers.
The Government’s Brexit plans will make workers in those four new sectors more vulnerable. The proposed short-term work visa will allow those workers to stay in the UK for only 12 months, which will give exploitative employers the opportunity to take advantage of the continual churn of a disposable workforce. We think that there will be a tendency towards more precarious work contracts in those sectors, as is already the case, such as zero hours and an increased risk of agency work or bogus self-employment.
As we heard in the oral evidence sessions, migrant workers are likely to be less well educated about their rights and less likely to report workplace issues as they may not have knowledge of UK labour laws or a good command of English. It will also be harder for unions to organise among them. Extending licensing provisions to those four new sectors will be important to help to protect workers from human trafficking and modern slavery, which is in line with the Government’s objectives; provide a clear guarantee to businesses seeking workers and to workers seeking employment that labour providers are operating responsibly and in line with the law; and prevent unscrupulous labour providers from undercutting responsible and legal competitors.
The licensing model adopted by the Gangmasters and Labour Abuse Authority has been commended internationally by the Council of Europe’s Group of Experts on Action against Trafficking in Human Beings, which called it an “example of good practice”. Repeated reviews of its function have commended its work to protect vulnerable workers and, importantly, have not found that its licensing function creates an undue burden on employers.
One concern was alluded to by the hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East and my hon. Friend the Member for Manchester, Gorton, which is that our labour inspection capacity is insufficient to provide the protections needed for those workers. The Employment Agency Standards Inspectorate oversees 18,000 employment agencies in the UK with a staff of 12. The likelihood of HMRC performing a proactive inspection—that is, a non-complaint-driven inspection—of a company to see if it is paying minimum wage rates is once every 500 years on average. The International Labour Organisation recommends a ratio of one inspector to 10,000 workers, but the UK rate is less than half that.
Today, the GLAA has to license four sectors and oversee the whole labour market with a staff of just 123 people. If we want a labour market that provides decent work and conditions to all in the future, the resources must be in place to enable that to happen. Although the new clause calls for effective licensing to protect migrant workers in sectors where short-term visas may be particularly prevalent, and where there is an increased risk of exploitation, it will also be important for Ministers to provide the resources needed to make such protection a reality.
We support the new clause to expand the remit of the GLAA. The GLAA performs a vital role in safeguarding the rights of workers and it is right that that should extend to the widest categories of vulnerable workers. My final point, which my hon. Friend has already made, is that the GLAA is chronically under- funded. We need to have more respect for the job it does.
I thank the hon. Member for Stretford and Urmston for introducing the new clause and giving us further opportunity to consider the critical matter of protecting the rights of migrant workers.
New clause 57 raises an important issue and I appreciate the intention behind it. As I indicated, I share the hon. Member’s concern that overseas workers—indeed, all workers—should be safe from abusive employment practices. Although I sympathise with the sentiment behind the new clause, I do not think it would be appropriate to change the Bill in the way proposed, for reasons I will explain.
First, it presumes that the employment practices for the sectors mentioned in the new clause are the same as the sectors currently licensed by the GLAA. They are not. The Gangmasters (Licensing) Act 2004 applies only to the agricultural, shellfish gathering, and food packaging and processing sectors, as that employment method is particular to those sectors. While gangmasters may be used in some cases, the practice is not prevalent in the supply of labour in the sectors covered by this new clause. In some sectors, such as construction, many workers are self-employed and in others workers are recruited directly, such as with people employed to do cleaning work.
If this new clause were to be passed, the consequence would be that many thousands of extra businesses—potentially every café or care home—would have to register as a gangmaster, with considerable expense but potentially little benefit. The new clause would in effect extend the scope of the Gangmasters (Licensing) Act 2004 to construction, cleaning, care or hospitality work, but only where that work is undertaken by EEA or Swiss nationals, and only where those individuals have come by that work through a particular route. That restriction does not sit comfortably in the existing regime, which defines scope through work sector and not through the characteristics of the individuals undertaking the work. The effect of the new clause would be to create a two-tier system, resulting in EEA and Swiss nationals receiving a greater degree of labour market protection.
The Government are fully committed to protecting the rights of migrant workers and I reassure the hon. Lady that the Government are giving active and serious consideration to these matters. I hope to be able to say more on that in the coming weeks. As I set out at length in earlier sittings, it is of the highest importance that everyone working within our economy is safe and is treated fairly and with respect. I am proud of the Government’s track record on this issue, with the introduction of the landmark Modern Slavery Act 2015 and the further powers we have given to the GLAA. We will not be complacent.
Let me be clear: migrants working lawfully in the UK are entitled to all the protections of UK law while they are here, whether it is entitlement to the minimum wage, health and safety legislation, working conditions, working time rules, maternity and paternity arrangements, the right to join a trade union, the right to strike, statutory rights, holiday and sick pay, and any of the other myriad protections that exist in UK law for workers. They apply to those who are in the UK on work visas every bit as much as they do for the resident workforce. That applies to both migrant workers who are here under the current immigration system and to those who may come in the future, under the new immigration system.
The Immigration Act 2016 created a new power to extend statutory licensing of gangmasters to new commercial sectors by secondary legislation, so the proposed new clause is not necessary. Although I am loth to say it, this demonstrates yet again that we could make the changes through the immigration rules, which might provide a convenient route to do so. In deciding whether to extend gangmaster licensing, the Government would need clear evidence that that is the right course and would draw advice from the Director of Labour Market Enforcement. I hope that having further considered the wider impacts of this new clause and heard my assurance that the protection of migrant workers is at the forefront of the Government’s thinking, the hon. Lady will feel able to withdraw the proposed new clause.
Yet again the Minister has missed the point about this new clause, as with others that apply to EEA nationals. Of course we would much rather apply such provisions to nationals of all countries, but as colleagues have said we are constrained by the scope of the Bill.
I am encouraged by some things the Minister has said, and particularly the possibility she sees of using the new immigration rules to extend the number of sectors covered by these provisions. I am not quite sure that it is right to say that some of the sectors we are talking about—construction, for example—do not make use of labour providers. I think they do. Self-employment status is often quasi self-employment in that sector. There is quite a lot of work that might be done with the Government to ensure that we have provisions that really work for the characteristics of those different sectors, whatever official names they may seek to attach to their model of labour requirement.
I am grateful that the Minister will say more about the Government’s plans for further protection of all workers. I am particularly interested in how those plans will benefit non-UK workers, including those coming in under immigration arrangements in the coming weeks. I very much encourage her to continue conversations with colleagues who take an interest in these matters and with the advocacy bodies that speak for these vulnerable workers, some of which gave the Committee very impressive evidence a couple of weeks ago.
In the light of the Minister’s encouraging response, I beg to ask leave to withdraw the motion.
As we have now concluded the Bill’s Committee stage, I thank both you, Mr Stringer, and your co-Chair, Sir David Amess, for your effective chairmanship and for keeping us all in order. It might be only me who tried your patience—I am sure other Members have a view on that. I know you have been advised throughout by the Clerks to the Committee, who have acted with a great deal of professionalism. I extend my gratitude to them.
I thank all the Committee members for their thoughtful consideration of the issues we have debated over the past few weeks. Although we by no means agreed on everything, we debated important points in a constructive spirit and considered a wide range of matters very carefully. I am particularly grateful to the Opposition spokespeople, the hon. Members for Manchester, Gorton and for Cumbernauld, Kilsyth and Kirkintilloch East—I have said that constituency name an awful lot over the past fortnight; I hope I have pronounced it correctly—for their valuable contributions on a range of important issues. I suspect those will not be their last words on the Bill.
I thank the policemen and the Doorkeepers, who kept us safe and ensured that everyone received the support they needed, and the staff of the Official Report, who ensured that all our pearls of wisdom were faithfully recorded. Finally, I thank my Bill team, who have been unfailingly good humoured in keeping me in line and helping me through my first Bill Committee in this role. I am very much indebted to them. I look forward to considering the Bill during its next stage.
May I add my thanks to you, Mr Stringer, and your colleague, Sir David Amess, for the excellent job you have done of steering us through the Bill? I thank the Clerks for all the help they have provided, not only here but outside this room. I also thank all the Committee members; like the Minister, this is my first attempt at a Bill Committee, so I am particularly grateful to my Front-Bench colleagues for all their help. Let us not forget all the other staff who helped us, too. I look forward to the next stage of the Bill.