Lord Londesborough (CB)

My Lords, I rise to speak to two amendments in this group, 270 and 279, which are both under the name of the noble Baroness, Lady Noakes. I support and have added my name to both of them. I will start with Amendment 270, which addresses Clause 91 and calls—quite reasonably, in my view—for separate analysis and proposals for a labour market enforcement strategy for small and micro businesses. As the noble Baroness pointed out, here we have another section of the Bill where the one-size-fits-all approach will be very difficult to enforce without running the risks and incurring the costs of applying the proverbial sledgehammer to crack nuts—the nuts in this case being the small and micro businesses with fewer than 50 staff. Given the huge scope of this Bill, which has approaching 200 clauses, small businesses are very likely to have much higher levels of non-compliance—much of it inadvertent—compared with their medium-sized and larger counterparts. This is for two principal reasons. First, they simply do not have the in-house HR compliance or legal resource to cover all this legislation, and very often it will fall on the business owner or manager to keep up, while he or she struggles with all the other challenges of trying to run a business profitably and sustainably in the face of all sorts of macroeconomic and microeconomic headwinds. Secondly, there are the disproportionate costs associated with being fully compliant that fall on small and micro enterprises. They simply do not have the budget or cashflow to spend on external advisers and employment lawyers who can advise them on how to navigate all the new clauses and conditions that run across the hundreds of pages of this Bill. As we have heard, a visit to a small or micro business from an enforcement officer, however well trained they are, will have a far greater and more unsettling impact on the owner and their staff than a visit to a medium-sized or large business. As the noble Lord, Lord Sharpe, pointed out, I note that the Government appear not to be planning to provide any material assistance to SMBs to help them understand and comply—or are they? I throw that question to the Minister. As we know, the impact assessment for the Bill rather shrugs its shoulders by admitting that SMBs will be disproportionately hit, in terms of costs and their time, and they are apparently just expected to suck it up. As the noble Baroness said, this is not to argue against an enforcement strategy per se, but it needs to be tailored and proportionate to the size of the business, specifically for micro and small companies. On Amendment 279, it is for very similar reasons that I support this exemption for officers of micro and small businesses from the extension of liability in Clause 141. I support an exemption because these businesses typically do not have boards of directors or advisory groups, or non-exec chairs or governors; they tend to be managed by one or two principals who hold responsibility for pretty much everything to keep the business going, including finance, sales, marketing, customer engagement, product or service development, not to mention general HR which, as we all know, is going to get more far more complicated. Finally, speaking from my own lived experience as an adviser to several small companies, and having run an SME myself for nearly 30 years, I say that we really must guard against deterring business owners and entrepreneurs from starting up and scaling businesses, and specifically from creating new jobs, often at high risk, without threatening them or, indeed, their officers with excessive and menacing levels of extended liability. I say this, mindful of the fact that the ONS reported last week that we had lost 109,000 payroll jobs in the space of one single month. It is not a great time to be spreading fear and uncertainty.