Lord Jackson of Peterborough (Con)

My Lords, I am delighted to have the opportunity to move this amendment on behalf of my noble friend Lady Noakes, who is unable to be in her place today. I have to say that these parts of the Bill, Parts 4 and 5, will be the most contentious, but I think this is the meat and drink of what the Bill is intended to do, which is essentially to repeal most of the labour relations legislation put in place by successive Conservative Governments since 1992. I am tempted by the noble Baroness, Lady O’Grady of Upper Holloway, and her hagiography of labour relations and trade union activity before 1979, as if it was a land of milk and honey, the closed shop did not exist and the trade unions had not brought the country to its knees, to the extent that a third of trade unionists in the 1979 general election voted Conservative. In fact, Conservative trade unionists were one of the most powerful and influential groups in the Conservative Party at the time. That was the reality of the situation then: the closed shop bringing the motor industry and various other industries to their knees. Many working-class people were sick to death of the trade unions, which is why they voted Conservative. The idea that it was a dark, draconian period of the evil capitalist bosses forcing the horny-handed sons of toil into penury was nonsense. I am more than happy for the noble Baroness, Lady O’Grady, to disabuse me of my prejudices, but I do not think that she will. Historically, we won general elections as a party because trade unionists supported us as they knew that reform was vital. We will no doubt debate that at length as we go on. While I am being slightly contentious, I note the Cross Benches are empty, bar the noble Lord, Lord Berkeley of Knighton, whom it is always a pleasure to see. In many of the Bills over the last two years, the Cross Benches deprecated the use of excessive reliance on delegated powers. They would pop up during every piece of primary legislation, every Bill, to complain about the ministerial misuse of delegated powers, which is happening in this Bill in spades. Yet where are they? They are not present to remonstrate with the Government, take issue with the Government or hold the Government to account on that. Anyway, we must proceed. In moving Amendment 205, I will speak also to Amendments 206 to 208, and the Clause 55 stand part notice tabled by my noble friends Lord Hunt of Wirral and Lord Sharpe of Epsom. The practical and economic consequences of Clause 55 without amendment are likely to be damaging to the very workers whom the Bill claims to protect. This is against an economic background where we have growth becalmed, flat growth of GDP and a very tough labour market out there. Yet the Bill will load further incumbencies on small businesses in particular. Amendment 207 seeks to exempt micro-employers—those with fewer than 10 employees—from the obligation in respect of access. These amendments reflect a recognition that a one-size-fits-all mandate across employers of vastly different scale is neither fair nor sustainable. Micro-businesses and SMEs are already struggling under the weight of administrative obligations. Writing in an open letter, signed by FTSE 250 firm Mitie, industry leader OCS and other employers from the £60 billion facilities sector warned that the Bill’s radical package would “discourage growth”, damaging their businesses and harming their clients and, crucially, their staff. Tina McKenzie, policy chair at the Federation of Small Businesses, put it succinctly: “The Government also needs to think again and rework the parts of the Employment Rights Bill that will wreak havoc on hiring”. This is a Government ostensibly focused on growth who have created—although we have never seen it written down in a comprehensive way—the so-called growth test that the Chancellor has referenced. Tina McKenzie’s concerns are far from abstract. We are facing a sustained fall in payroll employment. Small businesses, the engine of British job creation, are being hit hardest. The rise in national insurance contributions and a growing web of compliance burdens are already pushing small firms to the edge. This clause in its current form risks tipping many over. Amendment 205 seeks to ensure that the obligation to issue this statement applies only to employers with more than 50 workers. This is a reasonable and proportionate step. Larger firms are more likely to have a human resources infrastructure to absorb such obligations. For smaller enterprises, every new administrative requirement pulls resources from service delivery and job creation. It has an impact on the bottom line, which inevitably will feed through to decisions to not employ people or to make people redundant, which we would all deprecate. Let us not be naive: the cumulative effect of obligations like this can and will lead to reduced hiring, increased redundancies and the potential acceleration of automation. Faced with mounting costs, employers may choose software over staff. The Government must be mindful that even well-intended regulation carries a cost. In the words of the very employees this Government say they want to support: “We are deeply concerned that some of the Bill’s provisions will have serious unintended consequences that could harm both good employers and the very employees that the Bill seeks to protect”. My noble friend Lord Sharpe of Epsom referenced the British Retail Consortium survey published on 29 April. It bears repetition, because it is a pretty damning indictment of the very significant concerns that employers at the sharp end—this is a survey of HR directors—have about the Bill as it stands. Some 70% believe that the Bill “would have a very negative or negative impact on their business”, 52% said it would result in fewer staff members in their businesses and 61% said it “would reduce flexibility in job offerings”. They have urged the Government to engage, and today I echo that call. Finally, Amendment 208 seeks to probe why the requirement to issue this statement must extend beyond the point of employment commencement. Is there any compelling justification for placing employers on a continual alert to reissue the statement at “prescribed times”? What does that even mean? Why is it necessary for the Secretary of State to intervene in the minutiae of a business—in the very weeds of how a business runs to make money, make profit, provide jobs, pay taxes and deliver public services for people? Why is it important for Ministers to involve themselves in the prescribed times a statement can be given? Surely, if the goal is awareness, combining this with the statement of employment particulars under Section 1 of the 1996 Act would suffice. We should not mandate bureaucracy for its own sake. Let us step back and consider the broader context. If the Minister did not want to listen to the British Retail Consortium, she will no doubt be aware of other surveys published recently, such as that by the Federation of Small Businesses earlier in the year, which revealed that “92 per cent of small employers are worried about the Employment Rights Bill, with 67 per cent saying they plan to recruit fewer staff, and 32 per cent set to reduce headcount”. The Minister will know that her ministerial colleague, the MP for Ellesmere Port and Bromborough, has been challenged in the other place on a number of occasions to name just one small business that supported the Bill, and has hitherto been unable to come up with a name. The Government have come forward with Richer Sounds—which is not a small business by any stretch of the imagination—and Centrica, which is a massive business. I know that, under the Bill, big businesses will probably soon end up as small businesses, but that is a different matter. They also mentioned the Co-op. There is a surprise: the Co-op supporting the Labour Party; “The Pope likes balconies” will be the next one. Yes, the Co-op supports the Bill. It is important to step back and think about the Bill. In an already fragile market where businesses are battling inflation, rising taxes and regulatory fatigue, we must not view administrative obligations as cost-free, because they are not. They weigh heavily, particularly on the smallest firms. I speak from experience. A number of years ago, I was an Investors in People manager, when I used to help small and medium-sized businesses with their quality standards. They often did not want to engage, because they did not have the time and the energy as they were focused on chasing invoices, chasing new businesses and giving presentations to potential new clients. These are the burdens that small businesses face every day. They become big businesses, and they pay taxes, so I ask the Minister to give some consideration to that.