My Lords, I cannot resist making one point on employee engagement. As we move on to the Certification Officer, the measures that we are about to debate would certainly have hugely benefited from some form of employee engagement. I noted in the evidence of the Certification Officer of 9 February to the Select Committee on Trade Union Political Funds and Political Party Funding that he was asked whether he was consulted about the measures that related to party funding. He said:
“No, I was not consulted”.
He was asked a broader question on whether he was consulted at all and he said, “Not before the Bill”. These measures have the hallmark of something that would have greatly benefited from being examined carefully, and if advice, experience and evidence had been sought from the Certification Officer.
The Trade Union and Labour Relations (Consolidation) Act 1992 clearly intended that the Certification Officer should be accountable primarily to trade union members and that he was to codify reports on compliance, have powers of investigation and intervention and deal with complaints. With the breaches of any rules, remedies were underpinned by law. Indeed, the noble Lord, Lord Forsyth, in the previous debate, gave us a very good understanding of how this was to deal with the issue of a significant foundation about how members felt about the unions and where the unions were. We can certainly agree with that. But we now move on to something where we are substantially and almost completely changing the role and function of the Certification Officer and muddying the waters tremendously.
In his evidence, the Certification Officer was asked about whether the problems about complaints were consistent with his understanding. He said:
“All rules can be improved. No one has complained to me at any time that they have been impaired in making a complaint or pursuing what they want to do. Of course, that does not mean that they do not feel that way—it is just that it has not been reported to me. The answer to the first part of your question is that I am not sure; there is no evidence of that”.
He went on to say:
“The Bill approaches it from a totally different perspective. They are not trying to tinker with what exists; they want a new model. I do not think it is fair to say that it is successful or not successful in perfecting the existing model”.
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I find it strange to be debating the expansion of a role like this with the Minister after our discussions on the Small Business Commissioner in a previous Bill, where there was such an apparent case for the extension of the role, which was so narrow as just to be about collating data. There has to be a significant case for why this Bill widens the current role of the Certification Officer. The Bill seeks to extend his role, accountability, reporting and data collection duties and turn him into an inquisitor. Trade unions are being exposed to a vastly different and colossal burden of regulation, which breaks new ground constitutionally and legally and is out of all proportion to any conceivable mischief the Government have conspicuously failed to identify.
Indeed, there is a rationale for the intervention suggested, as outlined in the impact assessment. There are three legs to it. The first is a market-failure argument that suggests that the regulator needs significant change not because members have a detriment but because,
“The actions of unions can have wider impacts beyond their membership and their operations may not always be transparent to the wider public”.
This completely transforms the nature of what we are talking about and puts in a burden which is impossible to meet for almost any institution or organisation. In fact, in regulatory principles, this is by far the largest extension that we have had, even if we consider what happens in other industries that are heavily regulated.
Secondly, the impact assessment suggests:
“The regulator must have available sufficiently robust enforcement powers and sanctions to deter breaches”.
We have evidence of what the potential breaches are in the role, work and reports of the Certification Officer, and I will come to that later. However, there is no current sense of where there is an identifiable market failure to suggest these measures. The impact assessment also states:
“The Trade Union Bill is modernising and reforming trade union law. Therefore, we will need a regulator that has the right tools to deter breaches with this updated framework, and in a proportionate manner. It is only fair that trade union members, employers and the public can rely on robust regulation of trade unions.”
Again, there is no evidence about why any of these things suggest that there are any particular failures in the regulation of trade unions in relation to their members or other activities. The case is just not made.
Finally, the impact assessment makes the point that:
“The Bill provides for recovery of the costs of running the regulator”.
It establishes the principle that the trade unions should pay in regard to protecting their members. Whether or not that is the case—I am not hugely sympathetic to that view, given the Charity Commission and others—I think the Government could make a case, but if they were to make such a case, there has to be proportionality in the costs, but the costs have no proportionality whatever.
What was also interesting in the evidence of the Certification Officer was the huge difference in his prediction of the costs and consequences of these activities on the Certification Officer and on trade unions. He made the point that, from calculating what he estimates to be the changes required to the Certifications Officer’s costs, there would be significantly greater costs on trade unions. The impact assessment, without any basis, notion, thought, breakdown or anything covering the Certification Officer’s report, suggests that there may be 50 more declarations over five years. This does not bear serious consideration, given the report of the Certification Officer and the data that have already been published.
I suggest that all Members spend time reading the annual report of the Certification Officer, which is significant and comprehensive, covering all sorts of requirements and obligations on trade unions, including superannuation schemes, membership information, data and all sorts of other things. There is a considerable section on where there have been complaints and breaches of trade union rules. It talks about the number of people who made complaints and says that in the year from 1 April 2014 to 31 March a total of 542 inquiries were received: 42 on general advice on the role of the Certification Officer; 96 on issues related to the listing of trade unions and employers’ associations; 21 on annual returns and financial issues; 20 on certificates of independence; 11 on appointment, election or dismissal from any office in the union; and a very few about disciplinary proceedings, balloting and political funds. These are small numbers of inquiries only, which did not lead to complaints. There is no sense that there is either a particular hurdle to raising complaints so that issues are not addressed or that the complaints are drifting in a particular direction. In fact, the only thing that is identified is that the number of inquiries is down, as it has been consistently over a period of time, which is testament to the particularly good job that the Certification Officer has been doing—I hope that by saying that I have not sealed his early termination.
I stress that 11 applications for consideration remained to be determined. The report goes through the series of complaints and issues and how they were dealt with. I have to say that the Certification Officer deals with them very well in the report. Given the number of issues that were raised, I have not calculated the percentage but I think that the unions are broadly running at an average of 80-20 in their favour on how they have dealt with them.
I just cannot see an evidential base for this provision. It is yet another measure with no problem to solve, no justification in the impact assessment and no arguments that bear scrutiny, with no balance of fairness and with the intention of, at best, making life difficult and, at worst, allowing the most malevolent in our society a licence to cause mischief. At heart, this is a detriment to members, not least because of the massive costs involved. We are opening up the examination of trade unions to anyone, even if they harbour ill will with no grounds or justification. The measure creates the ability to frustrate any dispute by means of egregious complaints to the Certification Officer, and allows the Certification Officer to start being involved in any sort of issues that
he feels there are grounds for. The costs of this falls on the members. Without a sensible estimate or principle for how the proper costs of this could be established, this is an open-ended burden on members of trade unions.
Our amendments seek to probe, and propose some mitigating factors. The first amendment in the group seeks to prevent the insertion into the 1992 Act of Schedule 1 to the Bill, which provides for the Certification Officer’s extended investigatory powers. The extent of those proposed new powers is wide-ranging; they sweep far beyond what is wholly necessary. This proposed remit should be of concern to all, but of particular concern is the potential impact on the privacy of individual trade union members. As it stands, the Certification Officer or other persons can request detailed information from all trade unions on the personal data of their members, including the names and addresses. The BMA has said that these,
“New powers for the Certification Officer threaten to intrude into union activities and affairs and presents a potential invasion of trade union members’ rights to privacy”.
The sentiment shown by the BMA has been echoed by many other trade unions and human rights groups. It should lead us to question why this level of data is required at all by the Certification Officer. Many workers and trade union members quite legitimately do not wish their employers to know that they belong to a union, and it should remain their right to keep such personal information private. The Bill removes any guarantee that details of trade union membership and names and addresses of individuals will remain private. Given the sensitive history around blacklisting—I am not even sure we can call it “history”, since it still happens today—how can the Government assure trade union members that these new investigatory powers will guarantee individual privacy and the safety of personal information in relation to trade union membership and current or future employers? It is for that reason and many others that the Equality and Human Rights Commission concluded that the proposed new investigatory enforcement powers do not comply with the European Convention on Human Rights.
In addition to the type of personal data which could be collected by the Certification Officer, the question remains as to what purpose this data on individual trade union members will serve to the aim of the Bill or the work of the Certification Officer itself. The answer is: very little. At best this is overkill and at worst it could seriously infringe the privacy rights of 6.5 million trade union members. However, I do not ask noble Lords to take my word for it. The Certification Officer himself in giving evidence to the Select Committee was asked by my noble friend Lord Whitty whether he believed that there were any administrative reasons for the Government’s proposals and whether there was any obvious need for improvement in current legislation or requirements of union rules, and said very clearly that no one has made such a complaint.
At the very heart of our amendment to remove these new investigatory powers is the notion that there are no grounds for change. No one—neither trade union members, employers or businesses nor even the Certification Officer himself—is calling for more powers
of investigation. With seemingly no call from any involved parties to change the investigatory powers of the Certification Officer, how and why have the Government identified the need to do so?
The second set of amendments deal with changes to the Certification Officer’s powers, which would allow him to instigate an investigation without the need for a complaint, as well as complaints no longer having to be made by a member of the trade union they are complaining about. These amendments state the need for a complainant or applicant to be a member of the union which is the subject of the complaint or application. This is just common sense. There is a real need to protect unions, their members, employers and the Certification Officer from wasted time on malicious complaints. As it currently stands, the Bill allows any third party to instigate a complaint. Anyone from aggrieved employers or employees, any campaign group or even a rival trade union from within the same workplace could become complainants without having ever been in direct contact or personally affected by the actions of the union which is the subject of the complaint. It is just an unnecessary series of complications.
Putting aside the very real threat of leaving the Certification Officer open to malicious complaints, the post may also be subject to an increase in workload due to non-malicious complaints which are still not valid. Complainants could unwittingly instigate unfounded complaints because they are so far removed from the trade union that is the subject of a complaint that they lack the adequate knowledge about a situation or practices of a trade union that they are not a member of.
As it stands, the Bill leaves the investigations of the Certification Office vulnerable to misuse, adding to the time and costs of the Certification Officer’s investigations. Amendments 100 and 108 simply seek to offer the protection that is needed to both trade unions and the Certification Officer against any unnecessary additional investigations and a further strain on resources. The Bill proposes an extension of power which places the Certification Officer in the almost unprecedented position of becoming the investigator, the prosecutor and the adjudicator.
During the Select Committee evidence session, the Certification Officer confirmed that he had raised concerns about this drastic change in role and responsibilities with the Government. He said:
“We have explained the difficulties of the investigator/prosecutor/adjudicator role. I have tried to find, and have asked for, an example of a body, such as the Financial Conduct Authority, that investigates and adjudicates, as you read in the press, to see how it does that. There is nearly always an independent body. The FCA has an independent body that makes recommendations, and the decision is made by the board. The only example we have been given is that of the groceries adjudicator, who apparently does the same thing”.
Bodies such as the Financial Conduct Authority ensure that there is a clear division, and that independence is maintained, between any decision to investigate, the investigation itself, the decision whether disciplinary action may be merited and the decision whether there has been a breach. Why, then, has no such guarantee been provided for trade unions and the Certification Officer within the Bill?
On the last amendment in this group, Amendment 117A seeks to address this very problem by probing the Government’s attitude to the case for establishing an independent adjudication panel to adjudicate cases where the Certification Officer considers exercising his new powers in the Bill. Very much like the FCA panels, the panel would publish an annual report and might comment on the work of the CO, which the CO would respond to within six months of the publishing of the report. This important probing amendment tries to understand deeply what the Government’s objections are to any other form which separates those roles and makes it more sensible.
I must say in this regard that it is very important to place on record the serious concerns presented by the Equality and Human Rights Commission. It has provided a very clear statement on this measure, which is worth addressing at length because it makes the point better than anyone else could. Its analysis says:
“Article 6(1) of the ECHR provides that, in the determining of their civil rights and obligations, everyone is entitled to a fair hearing by an independent and impartial tribunal. In our assessment, the new proactive character of the CO’s functions (i.e. the power to instigate, investigate and then adjudicate the same complaint) compromises the impartiality of the CO. In particular, the new power to instigate a complaint implies that the CO may have already decided that there is something worth looking into further and taken a view of its merits. This is inconsistent with the Article 6 requirement that a complaint should be impartially determined by an independent body. The Government has argued that the right of appeal to the Employment Appeal Tribunal … would remedy any such breach of Article 6. However, in our assessment this would not be a sufficient answer where the CO makes findings of fact and an appeal to the EAT lies only on a point of law, as is the case with current appeals against CO decisions under,”
the 1992 Act. It continues:
“The provisions of Clause 15 and related Schedules are also relevant to the UK’s other international legal obligations, in particular, under the ILO Convention 87 on Freedom of Association and Protection of the Right to Organise. Although they cannot be directly enforced through our domestic courts, international human rights treaties (conventions and charters) are legally binding in international law and have mechanisms to hold States to account. The Commission notes that the ILO Committee of Experts, a body which provides advice to the bodies which are responsible for enforcing ILO Conventions, has asked the UK Government to review a number of the provisions in the Bill and to provide comments on the proposals to extend the powers of the CO”.
That is a particularly dramatic and significant statement. It is very important that the Government try to meet the test of answering those questions. I do not think that they can, but I look forward to hearing from the Minister.
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In looking at this part of the Bill, I have asked: for whom and to what benefit are the Government extending the powers of the Certification Officer? Throughout the evidence sessions with the trade unions and the Certification Officer, no one expressed an explicit need for the extended powers within the Bill. I keep on reinforcing the point that these are the words of the Certification Officer himself:
“No one has complained to me at any time that they have been impaired in making a complaint or pursuing what they want to do”—
no one except this Government.
In my view, these extensions of the Certification Officer’s investigatory powers reveal the real intention behind the Bill. What this Government are pursuing is motivated more by the want to suppress trade unions and their members than by the need to improve openness and transparency. I beg to move.