Justin Madders MP: speeches 2024

Speeches

• 5 Dec 2024 · Employment Rights Bill (Seventh sitting) · Hansard source

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  Thank you, Mr Mundell. I am not sure whether that was directed at me, other members of the Committee, or maybe all of us.

• 5 Dec 2024 · Employment Rights Bill (Seventh sitting) · Hansard source

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  I beg to move amendment 37, in clause 3, page 22, line 11, after “must” insert “— (a) make a declaration to that effect, and. (b) ”. This amendment and amendment 38 require an employment tribunal that finds a complaint under proposed section 27BS of the Employment Rights Act 1996 well-founded to make a declaration to that effect.

• 5 Dec 2024 · Employment Rights Bill (Seventh sitting) · Hansard source

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  The amendments will ensure that the provisions on the maximum compensation awarded by a tribunal for detriment cases will be workable for cases involving the termination of an arrangement that is not a worker’s contract. Where there is no worker’s contract in place, it may be very difficult to determine the individual’s termination date. Let me clarify what I mean by that, if I can do so in such a technical area. A zero-hours contract is a contract in which the worker undertakes to work for the employer when the employer makes work available to them, but there is no obligation on the employer to make work available. It is a worker’s contract because it involves obligations on the worker to undertake work. A zero-hours arrangement is an arrangement under which the employer is not obliged to make work available, and the worker is under no obligation to accept work when offered. Zero-hours contracts are workers’ contracts because there is an undertaking to work, whereas zero-hours arrangements are not workers’ contracts because there is insufficient mutuality of obligation. There are particular complexities in applying legislation that involves a particular effective date of termination to those on zero-hours arrangements. The worker’s exact termination date may be difficult to determine and the calculation of compensation will therefore be circumstance-specific, meaning that it is more appropriate for the employment tribunal to use its discretion in arriving at such sums. The amendment will ensure that in such cases, the amount that a tribunal awards will be left to its discretion. While there will not be a set maximum compensation for an individual on a zero-hours arrangement, as opposed to an employee on a zero-hours or low-hours contract, that maximum will be left to the discretion of the employment tribunal, which has the expertise to draw from the existing thresholds in compensation and apply them specifically to these types of cases.

• 5 Dec 2024 · Employment Rights Bill (Seventh sitting) · Hansard source

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  I beg to move amendment 42, in clause 4, page 23, leave out lines 34 to 39. This amendment is consequential on NC11.

• 5 Dec 2024 · Employment Rights Bill (Seventh sitting) · Hansard source

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  The amendments relate to detriment claims only, whereas the shadow Minister’s question is a slightly broader one. The point about compensation in other situations would be far more detailed. As this is about people on irregular contracts who may have suffered a detriment that we cannot possibly predict in advance, it is normal to say at this stage that the usual principles of the just and equitable compensation that an employment tribunal would award will apply in those circumstances.

• 5 Dec 2024 · Employment Rights Bill (Seventh sitting) · Hansard source

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  Amendment 46 will broaden the detriment provisions in respect of the right to guaranteed hours. It will ensure that a worker has a right not to be subjected to detriment on the grounds that the worker is, or the employer believes that the worker is, entitled to an offer of guaranteed hours. The existing provisions protect workers from detriment only where a worker accepts or rejects an offer of guaranteed hours or proposes to do so; where the worker declines to work a shift, as they believe their employer has failed to comply with their obligation in relation to notice of shifts; or because the worker alleges the existence of such grounds to take a case to an employment tribunal. Amendment 47 is a consequential amendment that clarifies the definition of “reference period” in amendment 46. The amendments will extend the protections to ensure that detriment to the worker arising from the right to guaranteed hours can be addressed. The detriment experienced by the worker may include cases in which a worker’s contract is terminated. Whether a worker experiences a detriment on those new grounds will be a matter for the employment tribunal to determine in the usual manner.

• 5 Dec 2024 · Employment Rights Bill (Seventh sitting) · Hansard source

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  I am grateful for the shadow Minister’s questions. They cannot be answered in the round, as all cases will be very fact-specific. The maximum that a tribunal awards will be down to the circumstances in which workers find themselves. With a zero-hours contract, there will be a whole range of issues relating to the kind of work that they would have expected if the detriment had not taken place. It is a well-established principle that a tribunal will award what is just and equitable in the circumstances. Tribunals are well versed in understanding the factors that they would need to take into account in making such awards. The shadow Minister tempts me to get into details, but as this is a Bill Committee and not an employment tribunal, I cannot give him the kind of detail that he is looking for.

• 5 Dec 2024 · Employment Rights Bill (Seventh sitting) · Hansard source

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  These amendments should be considered alongside amendment 30, because they clarify what happens when a shift is both moved and curtailed at the same time. The Bill provides a power to specify the amount that must be paid by employers when they cancel, curtail or move shifts at short notice. It cannot be used to specify a payment amount in excess of what the worker would have earned from working the original hours. However, the Bill was not clear whether the maximum payment due when a shift is both moved and curtailed at the same time should be calculated based on the provisions on movements or on curtailments, which would create different effects. For example, if a worker’s shift was due to be worked from 2 o’clock to 6 o’clock, but is moved and curtailed to 4 o’clock to 7 o’clock, the maximum payment could be based either on one or two hours of work, as the shift was moved by two hours but was curtailed by one hour. Amendment 31 clarifies what happens in such cases. The maximum payment in this scenario would be what they would have earned from two hours’ work, reflecting the maximum they would have earned had they worked their original four-hour shift. That will ensure that workers are compensated appropriately, and it will also provide clarity for employers. Amendment 32 clarifies for workers and employers how to calculate what amount of contractual payment can be offset against payments under clause 3 in cases where there is a combined short notice movement and curtailment of a shift. Again, the Bill is unclear whether the calculation should be based on the provisions on movements or on curtailments, which would create different effects. For example, if a worker’s shift was due to be worked from 2 o’clock to 6 o’clock, but is moved and curtailed to 4 o’clock to 7 o’clock, then after deducting the two hours in the shift that have stayed the same—4 o’clock to 6 o’clock—the remaining hours to be offset could be based on either one or two hours’ work. The amendment clarifies that the hours to be offset should be for two hours’ work, as the worker should be entitled to the payment under proposed new section 27BO of the Employment Rights Act 1996 for two hours. That will ensure that it is clear that an employer is not doubly liable for some hours in such scenarios. Although I appreciate that the amendments may appear complex, they will have the overall effect of simplifying the policy for employers and workers, so that it is very clear what happens when a shift is both curtailed and moved at the same time. They therefore prevent us from ending up with a whole load of litigation to decide what the correct outcome will be. I reassure the shadow Minister that the changes will not be rushed: they will not be implemented before 2026, which will give us time to consult further and provide some more information on how the measures will work in practice so that employers understand what is expected of them. We will provide clear guidance throughout. Many employers already guarantee hours, give reasonable notice of shifts, and make payments when they cancel shifts at short notice, so they will not need to alter their behaviour at all. In fact, data from the Chartered Institute of Personnel and Development suggests that around 33% of employers already pay some form of compensation for shifts cancelled with less than 24 hours’ notice.

• 5 Dec 2024 · Employment Rights Bill (Seventh sitting) · Hansard source

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  At the all-party parliamentary beer group’s reception last night, the shadow Minister and I talked about pubs. His question sounds perfect for a pub quiz for retired employment lawyers: it is the sort of thing that might end up getting taken to a group of KCs to understand the precise relationship. My best guess is that it would be classed as a zero-hours arrangement and would therefore be covered by the legislation. However, I do not wish to set a precedent inadvertently, so I will take further advice and come back to the shadow Minister. I hope he has some more interesting teasers like that: I am sure the entire employment law community are furiously scrabbling through their books to find the answer to his conundrum. Question put and agreed to. Clause 4, as amended, accordingly ordered to stand part of the Bill. Schedule 1 Consequential amendments relating to sections 1 to 3

• 5 Dec 2024 · Employment Rights Bill (Seventh sitting) · Hansard source

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  I will not detain the Committee too long on clause 4. It contains amendments to the Employment Rights Act 1996 related to clauses 1 to 3, which we have just debated. Proposed new section 27BU defines various terms used in clauses 1 to 3, and the rest of part 2A of the 1996 Act, relating to zero-hours workers and other similar workers. In particular, it copies across the definition of “zero hours contract” from section 27A of the 1996 Act. A zero-hours contract exists where the worker undertakes to work for the employer when the employer makes work available to them but there is no obligation on the employer to make work available. While that might be quite a lengthy explanation, I think that we all understand what we mean by that. New section 27BU also defines “zero hours arrangement” as an arrangement under which an individual works when the work is provided but “the employer is not required to make any work available to the individual, nor the individual required to accept it”.

• 5 Dec 2024 · Employment Rights Bill (Seventh sitting) · Hansard source

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  I will address that point, which I am sure we will hear on numerous occasions from the shadow Minister. He will be aware that it was a manifesto commitment to introduce the Bill within 100 days, which we are very pleased to have been able to adhere to, but that meant that not every element of policy was ready. As we have continued to consult, engage and develop our thoughts in this area, it has become apparent that it is possible to add to the Bill at this stage, to close some loopholes and provide some clarity. That is why the amendment was tabled. Amendment 31 agreed to. Amendments made: 32, in clause 3, page 21, leave out lines 3 to 13 and insert— “(a) where a shift has been cancelled, the hours that would have been worked if the shift had not been cancelled; (b) where a shift has been moved, or moved and curtailed (at the same time), and no part of the shift as moved, or as moved and curtailed, corresponds to the time of the shift (“the original shift”) before it was moved, or moved and curtailed, the hours that would have been worked during the original shift; (c) where a shift has been moved, or moved and curtailed (at the same time), and part of the shift as moved, or as moved and curtailed, corresponds to the time of the original shift (but part does not), the hours that would have been worked during the part of the original shift that does not correspond to the shift as moved, or as moved and curtailed; (d) where a shift has been— (i) curtailed but not moved, or (ii) moved and curtailed (at the same time) and the shift as moved and curtailed is to start and end within the time of the original shift, the hours that would have been worked if the shift had not been curtailed, or moved and curtailed.” This amendment has the effect of clarifying the hours to which a payment under proposed section 27BO(1) of the Employment Rights Act 1996 relates in cases where there is a combined short notice movement and curtailment of a shift and makes associated drafting changes to the amended provision. Amendment 33, in clause 3, page 21, line 26, leave out “three” and insert “six”. This amendment would increase the time limit for bringing proceedings under the new section 27BS(1)(a) of the Employment Rights Act 1996 from three months to six months. Amendment 34, in clause 3, page 21, line 31, leave out “three” and insert “six”. This amendment would increase the time limit for bringing proceedings under the new section 27BS(1)(b) of the Employment Rights Act 1996 from three months to six months. Amendment 35, in clause 3, page 21, line 36, leave out “three” and insert “six”. This amendment would increase the time limit for bringing proceedings under the new section 27BS(1)(c) of the Employment Rights Act 1996 from three months to six months. Amendment 36, in clause 3, page 21, line 40, leave out “three” and insert “six”.— (Justin Madders.) This amendment is consequential on amendments 33, 34 and 35 .

• 5 Dec 2024 · Employment Rights Bill (Seventh sitting) · Hansard source

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  I am grateful for the details of the shadow Minister’s dietary exploits today. We are looking in quite close detail at that situation, because there are a number of knock-on consequences, but we do not envisage that, in a situation where two workers agree of their own volition to swap shifts, the employer should in any way be penalised. We do not think that is in the spirit of what we are trying to achieve here. I return to the points that my hon. Friend the Member for Edinburgh East and Musselburgh made about particular workplaces. The Director of Labour Market Enforcement has undertaken quite a lot of work in respect of those issues; considerable evidence is emerging about concerns in those sectors, and I encourage him to undertake some further reading on that. There will be further consultation on what reasonable means. We all understand that there could be different factors applying, but what we want at the end of this process is for businesses to be clear about their obligations. That could mean a particular time period, but it could be different depending on the industry or the circumstances. It is right for us to take our time to consult and engage on that. The shadow Minister referred to the force majeure issue; there is a power in the Bill for us to provide for exemptions for short-notice shift cancellation—that is always a tricky phrase to get out—but in some of the examples he gave where a huge contract was lost, a notice cancellation payment was probably the least of the employee’s and the employer’s problems in that situation; there may be bigger questions about whether there is enough work at all. Those are the kinds of things we will be looking at, as the power in the Bill gives us that opportunity. Amendment 30 agreed to.

• 5 Dec 2024 · Employment Rights Bill (Seventh sitting) · Hansard source

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  Amendment 42 is another technical amendment that concerns not the function of the Bill but parliamentary procedure, so if we want another dry, technical debate, we certainly have the opportunity. Clause 4 makes provision for new section 27BW to be inserted into the Employment Rights Act 1996. New section 27BW(3) would allow regulations made under part 2A of the 1996 Act, relating to the provisions concerning zero hours, that are subject to different or no parliamentary procedure to be included in regulations subject to the affirmative procedure. New clause 11 amends section 236 of the 1996 Act and makes the same provision to allow the combining of instruments, but applies to any orders and regulations made under that Act, rather than to only those made using powers in part 2A. This is a technical amendment intended to ensure that implementation can be undertaken as efficiently as possible. On what instruments might need to be combined, we will be setting out further details required to implement zero-hours provisions through secondary legislation, but existing powers in the 1996 Act, such as the power in section 10 regarding pay statements, may play a part in supporting implementation. It may be that it would be appropriate to exercise that power to prescribe that pay statements must specify where payment has been made under proposed new section 27BO for the short-notice cancellation, movement or curtailment of a shift. Should that be the case, this provision would allow that amendment to be made in the same regulations as others to be made under new powers being inserted by this Bill that are—I am sure that the shadow Minister will be pleased to hear this—subject to the affirmative procedure. That will mean that provisions to be detailed in regulations that would have been subject to the negative procedure, or no procedure, receive greater scrutiny from Parliament before becoming law. In the light of the amendment made to section 236, amendment 42 removes the provisions that apply only to part 2A of the 1996 Act, as they will be redundant.

• 5 Dec 2024 · Employment Rights Bill (Seventh sitting) · Hansard source

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  I beg to move amendment 43, in schedule 1, page 106, line 8, at end insert— “In section 27 (meaning of ‘wages’ for purposes of Part 2 of the Act), in subsection (1)— (a) after the paragraph (ce) inserted by the Neonatal Care (Leave and Pay) Act 2023 insert— ‘(cf) a payment under section 27BO(1) of this Act (payment for a cancelled, moved or curtailed shift),’; (b) renumber the paragraph (ce) inserted by the Employment (Allocation of Tips) Act 2023 as paragraph (cg).” This amendment provides for a payment under proposed section 27BO(1) of the Employment Rights Act 1996 in respect of a short-notice cancellation, movement or curtailment of a shift to be treated as “wages” for the purposes of the provision about protection of wages in Part 2 of that Act. The right of a worker to bring a claim for unlawful deduction of wages is an important principle in employment law. It is right that payments for cancelled, moved and curtailed shifts are included in this provision. Although a worker can already claim through the employment tribunal that their employer has not made a payment for a cancelled, moved or curtailed shift, in some cases it may be more appropriate for workers to bring a claim under the unlawful deduction of wages provisions, for example if there are instances of non-payment covering a period of months or years; if they want to claim for financial loss as a result of non-payment, for instance because of bank charges; or if a claim covers non-payment of cancellation payments and other wages. The amendment will provide workers with an alternative remedy for non-payment, in addition to the new provisions in proposed new sections 27BS and 27BT of the Employment Rights Act 1996. That is in line with other statutory rights to payment, such as remuneration during suspension of work on medical grounds. I hope that that is a clear explanation.

• 5 Dec 2024 · Employment Rights Bill (Seventh sitting) · Hansard source

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  Well done to the shadow Minister—he must have had his Weetabix this morning. He has clearly put in a great deal of time and we appreciate the way that he has engaged with the debate and some of the issues. He is taking a much broader look at the principles behind the legislation, rather than a quite narrow technical amendment about when shifts are moved or curtailed, but I am happy to address his points as far as I can. I understand that the shadow Minister accepts the principle that we are trying to create some additional fairness in the workplace. That is welcome to hear, and I can assure him that this will not be a rush job. We do not anticipate these measures being implemented until 2026, and he will not be surprised to hear that the reason is that we intend to engage deeply with business and workers’ representatives on the details. There will be a consultation, following which we will set out in regulations what periods of notice should be presumed unreasonable; we will also set out factors for tribunals to take into account when considering whether notices are reasonable. That will go a long way towards addressing some of the concerns he mentions from Allen Simpson of UKHospitality. I think it is fair to say he generally welcomed the approach, but clearly some of the detail is to be worked on. I do not think there will be any prohibition on workers swapping shifts, but if the employer, having been notified that worker B has taken the shift instead of worker A, then cancels the shift at short notice, we would intend that the regulations would then be engaged.

• 3 Dec 2024 · Employment Rights Bill (Sixth sitting) · Hansard source

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  I am grateful for the shadow Minister’s amendment. If it is a probing amendment, he has asked a lot of reasonable questions. There are, of course, things that we will be hoping to address today and during the passage of the Bill—and, indeed, the subsequent regulations. The first thing to say is that we do not believe that it is right at this stage to put the time into the Bill; we want to give ourselves flexibility to respond to how the issue works in practice and to changing circumstances by doing that in secondary legislation. However, the hon. Gentleman has asked a perfectly reasonable question: who are we trying to help? What is our purpose? Our purpose is to try to help those people who simply do not have that security in their lives at the moment. Research from the Living Wage Foundation suggests that 25% of insecure workers have had their shifts cancelled unexpectedly, with 88% receiving less than full shift compensation. Many workers receive their shift schedules without reasonable notice, and that prevents them from being able to effectively plan their work, social lives and other responsibilities. Living Wage Foundation data found that in quarter 2 of 2023, 78% of workers received less than two weeks’ advance notice of shifts, with 5% of workers receiving less than one week. That can disadvantage workers’ ability to effectively plan their future income, particularly when that relates to budgeting for regular outgoings when shifts are cancelled, moved or curtailed at short notice. The impact on workers can include an increased reliance on debt and an inability to forecast income or find substitute work, childcare expenses and, on some occasions, travel expenses. Such implications represent the sort of one-sided flexibility that we are trying to deal with. Evidence suggests that the income insecurity premium could be worth as much as £160 million per year, but the issue is really going to be about that benefit targeting businesses in the right way. We believe that good management practice can deal with an awful lot of this without the need to resort to legislation.

• 3 Dec 2024 · Employment Rights Bill (Sixth sitting) · Hansard source

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  A lot of the questions the hon. Member asked will be dealt with by the regulations and by the anti-detriment provisions of the Bill. If he would like to see specific provisions in the Bill, he should have tabled amendments, but I believe we will address a lot of the detail he raised in due course. We are clear that this has to be a freely agreed contract between both parties. The employer should make the offer and the employee should be able to agree, of their own free will, on whether they wish to accept it. We will look closely at the coercion issue, because that has been raised with us. Government amendment 13 introduces new section 27BEA of the 1996 Act. It will introduce a duty on employers to take reasonable steps to make a potentially qualifying worker aware of their right to guaranteed hours should they meet the required conditions—that is, to draw workers’ attention to the new right and to the fact that they may be eligible for it. New section 27BF provides for workers to bring an employment tribunal claim to enforce their right to guaranteed hours. A worker may make a complaint if no guaranteed hours offer is made to a qualifying worker; if an offer is made but does not comply with the requirements relating to a guaranteed hours offer, such as offering work for a number of hours that reflects the hours worked during the reference period, or the offer does not comply with the regulations relating to such requirements; if the offer includes a prohibited variation to a worker’s terms and conditions; and if the offer does not comply with the requirements on the use of limited-term contracts, the prohibition on varying other terms, or the applicable requirements where the employer offers less favourable terms. To ensure that all rights are supported by appropriate protections, the Government amendments have added further grounds. Thus, a worker may make a complaint to an employment tribunal if the employer fails to provide a notice stating that they are exempt from the duty to make a guaranteed hours offer and which exemption applies, or fails to provide a notice stating that a guaranteed hours offer is treated as having been withdrawn further to an exemption applying or to a relevant termination; if the employer gives a notice to the worker stating that they are exempt from the duty to offer guaranteed hours when they should not have done so; if the employer gives the worker a notice relating to an exemption that does not refer to any exemption as set out in the regulations, or that relates to the wrong exemption; and if the employer fails to comply with the duties to provide workers with information about the right to guaranteed hours. New section 27BG outlines the time limit during which a worker may take their complaint to tribunal. Government amendments have been tabled to allow workers to take cases within six months, as opposed to three months, which is to align the Bill’s provisions with the changes we have talked about already. We have also tabled amendments that are consequential on the new rights included in the Bill, and also on the new grounds to make a complaint to the employment tribunal. Those relate to the additional requirements to serve a notice under new section 27BD, and to the claims related to the information rights. Finally, new section 27BH provides for the remedies to a well-founded complaint. It provides that tribunals must make a declaration if there has been a breach and may award compensation to be paid from the employer to the worker. In common with other existing employment rights, the compensation must not exceed a permitted maximum, which will be set out in regulations as a multiple of a number of weeks’ pay. I commend clause 1 to the Committee.

• 3 Dec 2024 · Employment Rights Bill (Sixth sitting) · Hansard source

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  I am afraid we are back into some of the more technical minor amendments, on which I will not detain the Committee too long. Amendment 24 will ensure that employers have to give reasonable notice of not only when a shift starts and how many hours it will be worked, but also when it will end. The Government’s intention is to avoid a scenario whereby a worker is notified of the start time and total duration of a shift, but does not receive reasonable notice of whether those hours will be in a single block, or whether there may be a large break. The current drafting would allow an employer to specify that a worker is required to work, for example, for three hours from 9 am on Friday, without specifying whether the shift will be from 9 to 12, or from 9 to 10 and then again from 12 to 2. In either scenario, the notice would meet the requirements to be a notice of the shift. The amendment closes this potential loophole. Some of my own children have gone into work and then been told to go and have a two-hour lunch break—unpaid. We clearly want to avoid that through this amendment. I turn briefly to Government amendments 25 to 27, which will ensure that workers are entitled to reasonable notice where an employer cuts working hours from the middle of a shift as well as from the start or end. The current drafting would arguably allow employers to reduce the number of working hours in the middle of a shift without giving reasonable notice. The amendments close that loophole, ensuring that workers have to be given reasonable notice if an employer decides to change the hours of a shift by reducing the hours in the middle.

• 3 Dec 2024 · Employment Rights Bill (Sixth sitting) · Hansard source

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  He is shaking his head—that is good. I certainly do not envisage that to be the case, but we recognise there is a backlog in the employment tribunals. Like many public services, they are under pressure, and there is a plan to recruit more judges in the new year.

• 3 Dec 2024 · Employment Rights Bill (Sixth sitting) · Hansard source

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  As the hon. Member will know, the total cost to businesses from the Bill, as set out in the impact assessment, is about 0.4% of total employer costs. We absolutely acknowledge that there are many good employers out there who do this already, and we hope that there are many employers who do not who will feel that it is a positive once the legislation comes in. We want to take them on that journey and inform them why this is a positive thing and a benefit for their workforce. Importantly, they will see that the playing field is levelled and hopefully be able to compete more ably with others who might in the past have undercut them. But part of that will be making sure that they have access to good advice, good support and a guiding hand to make sure that the clear policy outcomes we want to see from the Bill are actually delivered. On that note, Mr Stringer, I ask the shadow Minister to withdraw his amendment.

• 3 Dec 2024 · Employment Rights Bill (Sixth sitting) · Hansard source

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  I beg to move amendment 16, in clause 1, page 11, line 18, leave out “three” and insert “six”. This amendment would increase the time limit for bringing proceedings under the new section 27BF(1) of the Employment Rights Act 1996 from three months to six months.

• 3 Dec 2024 · Employment Rights Bill (Sixth sitting) · Hansard source

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  The way the shadow Minister was intervened on made it feel like this was an Opposition amendment, but it is actually a Government amendment to deal with the issue of split shifts and the anti-avoidance measures. This is about rebalancing the level of risk faced by a worker and an employer. At the moment, the balance is shifted too far one way. We estimate in the impact assessment that the cost to businesses of this policy could be up to £320 million a year. Clearly, a lot of that will end up being transferred directly into workers’ pockets. We hope that, through better workforce planning, that figure will go down and we will see improvements to the lives of those who will benefit from the Bill. I will make one further point. The shadow Minister referred several times to force majeure situations. There is provision in a later clause, which we will not get to today, for us to set out in regulations when there might be exceptions to this provision. There are lots of potential arguments about whether the provision should apply, and we intend to consult further before the final regulations are published and debated.

• 3 Dec 2024 · Employment Rights Bill (Sixth sitting) · Hansard source

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  To pick up on the points made by my hon. Friend the Member for Birmingham Northfield, this is about who we are trying to help. This clause is primarily about low-income workers who do not currently have the security and certainty of regular hours. They are more likely to be young, female or from an ethnic minority background. We have heard about the real impact that can have and about the power imbalance when an employer holds all the cards. To use my hon. Friend’s imagery, it is effectively like pointing to people at the factory gate and deciding whether they get work that day or not. We must move on from the indignity of that arrangement. I welcome the support from the Liberal Democrats. It is worth saying that there was general, albeit caveated, support from the witnesses we heard from in last week’s evidence sessions. I will tackle head-on the shadow Minister’s criticism about the lack of clarity and the need for certainty. Of course we want to give business certainty. I am sure that after the last few years of Conservative Government, we are all crying out for certainty, and there will be certainty. We are at an early stage of the legislative process for this Bill. It will be taken through Committee and through the Lords, and then there will be further consultation, secondary regulations and codes of practices, after which the laws will be implemented. As the Liberal Democrat spokesperson, the hon. Member for Chippenham, said, there is anxiety out there for businesses, but we are a long way off introducing this legislation, because there is so much more to do, and it is important that we do it. We want to get it right, we want to get clarity and certainty, and we want to ensure that this is an effective piece of legislation.

• 3 Dec 2024 · Employment Rights Bill (Sixth sitting) · Hansard source

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  I beg to move amendment 24, in clause 2, page 13, line 42, leave out “from what time on which day” and insert “when the shift is to start and end”. This amendment requires notice of a shift to include when the shift is to end (as well as how many hours are to be worked and from when).

• 3 Dec 2024 · Employment Rights Bill (Sixth sitting) · Hansard source

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  Here we are, three and a bit hours in, and we are on the stand part debate for clause 1. I hope we can make swifter progress, but I am sure Members will appreciate that we have debated a number of amendments to this clause, from both sides of the Committee. I will talk a little about clause 1, because it is central to our aim to improve working relations in this country. It introduces a new right to guaranteed hours, which, alongside some of the other measures in the Bill, will address the issue of one-sided flexibility by ensuring that those who are in scope of the Bill receive a baseline of security and predictability that has been sadly lacking to date. Our ability to care for loved ones, provide essentials, look after our health and deal with life and its challenges all relies on an element of predictability in our circumstances and finances. We know that a stable base makes us more resilient and more able to deal with challenges that come our way. Raising children, supporting family and our communities, making mortgage and rent payments, effective budgeting, and regular exercise are all good for the individual and for our society, and none combines easily with the unpredictability that some people face in their working lives. The proposed provisions on guaranteed hours and on notice regarding shifts, which we will come to in due course, will go some way to helping the many workers who work regularly—often for the same employer, and some of them for years—but who do not have the security of knowing there will be a pay packet next week or next month. These proposals, which are the result of engagement with employers and social partners, will introduce fair and proportionate duties. Many of these have already been adopted by our most forward-looking employers. The duties are rightly ambitious but also, if we continue to work collaboratively, workable and achievable. I will now explain the effects of each new section inserted into the Employment Rights Act 1996 by clause 1—this is effectively a series of new clauses inserted into our favourite, the 1996 Act. The first is new section 27BA, which outlines a new duty that will be placed on employers to offer qualifying workers guaranteed hours based on those hours worked during the reference period. While I hear and am considering the calls for the reference period to be put on the face of the Bill, at the moment the intention is for it to be specified in regulations. It is expected to be 12 weeks. The reason why consideration is being given to putting the initial and subsequent reference periods in regulations rather than in the Bill is that that will allow changes to be made to those periods. This is a novel right and we want to consider the emerging evidence on how it works in practice and, indeed, how it is evaded. However, I hear the calls about the need for certainty, and I will continue to engage with all relevant parties on whether this is something that we should put on the face of the Bill. New section 27BA outlines the qualifying criteria for this new right, which will be targeted at workers who are on zero-hours contracts or zero-hours arrangements, or have some guaranteed hours—up to a maximum number that will be defined in regulations—but work in excess of those hours, and whose hours over the reference period meet the conditions for regularity or number. Agency workers are not in the scope of the new section, but separate provisions may be made for them using the power in new section 27BV. We recently closed a consultation on applying the rights to guaranteed hours, notice of shifts and payment for cancelled shifts to agency workers. We will now analyse the responses to that consultation and consider whether to seek to amend the Bill later during its passage. The conditions for regularity and number of hours worked that must be satisfied during the initial reference period, as well as conditions for subsequent reference periods, will be set out in regulations following consultation. That will enable us to ensure that the measure is appropriately targeted at those workers who work regularly and in excess of their contracted hours. Although our intention is to minimise exemptions, regulations may be made to exclude categories of workers from the provisions, providing us with the flexibility to adjust the scope of this new right over time to respond to emerging practices. I have to say that at this stage I am not able to conceive of any particular exemptions that would apply, but I think it is important that we keep that power in the Bill. New section 27BB sets out the requirements that a guaranteed hours offer must meet. It allows a guaranteed hours offer to take the form of either a variation of terms and conditions or a new contract, depending on the circumstances. A guaranteed hours offer may take the form of an offer to vary terms and conditions only if the worker worked under a single worker’s contract from the beginning of the relevant reference period until the day after an offer is made or later. That would allow all other terms of the contract, other than hours and length of employment, to be kept the same. Where a worker has been engaged on more than one worker’s contract between the beginning of the reference period and the making of a guaranteed hours offer, that offer should take the form of an offer to enter into a new worker’s contract. Where a new contract is proposed, it must propose terms and conditions that, taken as a whole, are no less favourable than the terms and conditions relating to matters other than working hours and length of employment that the qualifying worker had when working for the employer during the relevant reference period. New section 27BB also allows regulations to set out details on how it is to be determined whether the hours offered in the guaranteed hours offer reflect those worked during a reference period. It also makes provisions around the use of limited-term contracts by employers offering guaranteed hours. “Limited-term contracts” means fixed-term contracts and those that are to end by virtue of a limiting event. That ensures that employers can continue to use limited-term contracts where it is reasonable to do so. The new section provides that, where the guaranteed hours offer takes the form of an offer to vary terms and conditions, the contract should usually become permanent. That should be done by removing the provision stipulating the termination of the contract by virtue of a limiting event, unless it can be said on the day after the offer is made that it would be reasonable for that contract to be entered into for a limited term. The use of a limited-term contract will be regarded as reasonable where the worker is needed only to perform a specific task and the contract ends after it is completed, or likewise for a particular event, or in other circumstances where the employer considers there is a temporary need, as set out in the regulations. For example, if would be reasonable for a contract to be of a limited term where a worker is providing cover for a colleague on parental leave. New section 27BC sets out requirements for a guaranteed hours offer where that offer takes the form of an offer to enter into a new worker’s contract and a worker has had more than one set of terms and conditions during the reference period. Its provisions will protect workers from being moved on to the worst of all the terms and conditions that they worked under during the reference period. Where an employer makes an offer of guaranteed hours with less favourable terms than the best the worker worked under the during the reference period, new section 27BC introduces a duty on employers to give the worker a notice explaining how the proposed terms and conditions constitute a “proportionate means of achieving a legitimate aim.” This will help to protect workers against being given less favourable terms and conditions in contravention of the aims of the Bill. New section 27BD provides for exceptions to the duty to offer guaranteed hours, including circumstances in which an offer already made should be treated as having been withdrawn. Exceptions will apply if the worker’s contract or arrangement is terminated during the reference period or offer period and it is a “relevant termination”. Similarly, where an offer of guaranteed hours has been made and there is a relevant termination of that worker’s contract during the response period, the offer will be treated as having been withdrawn. A relevant termination takes place where the worker decides to terminate the worker’s contract through no fault of the employer; the employer had a qualifying reason for terminating the contract and acted reasonably in treating that reason as sufficient to terminate the contract; or a worker’s limited-term contract ends by virtue of a limiting event and it was reasonable for that contract to have been entered into for a limited term. A qualifying reason is a reason that, when an employer is dismissing an employer, can be a fair reason for dismissal under section 98 of the Employment Rights Act 1996. New section 27BD also allows regulations to be made to specify circumstances in which the duty to offer guaranteed offers does not apply, and it is that section that sets out offer and response periods. The response period, during which a worker must respond to an offer, will begin on the day after an offer is made and its duration will be set out in regulations. We have made amendments to new section 27BD that will require employers to inform a worker when circumstances exist that exempt them from their duty to offer guaranteed hours, and similarly where a guaranteed hours offer is treated as having been withdrawn as a result of an exemption applying. That will ensure that workers are aware of which exemption applies, and that their employer has not merely failed to offer guaranteed hours. Any exemptions will of course be defined in regulations. Similarly, a further amendment requires that a notice is given where a guaranteed hours offer is treated as having been withdrawn as a result of a relevant termination. We have made further amendments to the new section, designed to close a potential loophole. As previously drafted, the provisions could have meant that in situations where an employer employs a worker on a series of short-term contracts and the last contract of the period terminates with a limiting event, that could have been treated as a relevant termination. As a result, an employer might not have been required to offer the worker guaranteed hours. The amendment has added a rebuttable presumption, which presumes that it is unreasonable for an employer to engage a worker on a series of limited-term contracts to undertake the same work, and that would therefore not be a relevant termination excepting the employer from their duty to offer guaranteed hours. If the employer fails to rebut that presumption, no exception will apply and the employer will still be required to offer guaranteed hours. New section 27BE sets out how the worker accepts or rejects an offer, and when the new contract or varied terms and conditions are deemed to take effect. It provides that a worker who does not respond to an offer will be treated as having rejected it, because we would not wish workers to be moved on to guaranteed hours if they had not specifically agreed to them. It provides for regulations to set the form and manner in which the worker must respond to the employer’s offer, and when the response is taken as having been given.