Minutes of Evidence 4 July 2002
Committee for Employment and Learning
Thursday 4 July 2002
Employment Bill:
Committee Stage
(NIA 11/01)
Members present:
Dr Birnie (Chairperson)
Mr Carrick (Deputy Chairperson)
Dr Adamson
Mr Dallat
Mr Hilditch
Mr R Hutchinson
Mr McElduff
Witnesses:
Ms J Harbison )
Ms M McSorley ) Equality Commission
Prof B Fitzpatrick ) for Northern Ireland
The Chairperson: Good afternoon. I welcome from the Equality Commission, Joan Harbison, chief commissioner, Mary McSorley, manager in the information and advice department, and Prof Barry Fitzpatrick, head of legal policy and advice. Thank you for your written submission.
Ms Harbison: I will speak first, and then Ms McSorley and Prof Fitzpatrick will talk about some issues that the Equality Commission thinks are significant. We are delighted to be here today, and have made previous representations to the Committee on this subject.
The Equality Commission is keen to support and encourage anything that extends parental rights and embraces flexible working and work/life balance. The commission was encouraged by the Minister's commitment to issues in relation to work/life balance, as we believe that having a content workforce, which feels valued by having good working conditions, is as good for business as it is for the individual. The commission works hard at all levels with employers, and is particularly sensitive to issues relating to small employers when any Regulations or legislation are introduced. Clarity in the legislation, and in Regulations developed from that, will benefit anyone who is trying to implement the legislation and people such as ourselves who are trying to advise employers on the implementation of that legislation.
We have some concerns about the differences between the Northern Ireland Bill and the comparable Bill in Great Britain. However, we understand that there are ways in which those differences may be covered. The commission wants to be absolutely assured that people in Northern Ireland would in no way be disadvantaged as a result of those differences, and that any gaps in the Northern Ireland Bill will be covered in some other way.
The Equality Commission is a body that promotes equality and equity, and it is important that people in Northern Ireland do not see that devolution disadvantages them in any way. We feel very strongly about that, as I am certain that most members, if not all members, of the Committee do. We have particular concerns about some aspects of the Bill and about how it relates to wider legislation.
Prof Fitzpatrick: We have two concerns that I will mention by way of introduction. It is difficult to react to the Bill when so much is reliant on Regulations being made later. We hope that the provisions to deal with matters in the Bill would be straightforward, but Regulations are necessary for a range of issues; for example, flexible working. Clause 13 amends the Employment Rights (Northern Ireland) Order 1996 - introducing clause 112G, subsection (2), paragraphs (a) to (n), which sets out what the Regulations should contain. Therefore we are concerned about the details that must go into any Regulations that will be made.
We are also concerned about the use of affirmative resolution Regulations, especially as two EU equality directives are apparently to be implemented through such resolutions before the next election. Affirmative resolution Regulations leave little opportunity for MLAs to influence the content, and we would have preferred to have seen more details of those arrangements in the Bill rather than relying on Regulations.
We are also genuinely disappointed that flexible working rights apply only to employees and not to workers. We have had a definition of the word "employees" for over 30 years, and many vulnerable workers are not always defined as such. As a former law professor, I would have had to examine the case law closely to ascertain who was an employee and who was not. Most European legislation, minimum wage legislation and other such matters use the term "worker" instead of "employee". For example, the working time Regulations, which deal with annual leave, refer to workers, yet this Bill refers to employees. The minimum wage legislation deals with pay, as does this Bill, yet even from an employer's viewpoint, employers will have to have different regimes depending on whether those who work for them are workers or employees. The Equality Commission feels that the legislation should simply use the well-established definition of "worker", rather than "employee".
Ms Harbison: That reinforces the importance of the clarity that I mentioned at the beginning. That sort of clarity becomes important in our work in supporting, helping and advising employers. It makes it easier for the employer and us - and any other similar bodies - to advise people clearly and in a way in which they can implement what we say.
Ms McSorley: We made some specific comments in our submission about what we would have liked to have seen on paid maternity and adoption leave, and, indeed, the new flexible working request right. Following on from Prof Fitzpatrick's point, it is difficult to make definitive comments when we do not have the detail of the Regulations. We raised some concerns in the earlier consultations, and we were slightly disappointed that the opportunity has not been taken in the Bill to look at some of the other general rights for parents; for example, parental leave and time off for dependants.
The Bill could have provided an opportunity to look at some of those general areas, because we foresee that also creating some problems for employers. There is already a lot of uncertainty and confusion about the distinction between paternity and parental leave, which arose when the latter was first introduced. Although we welcome all the provisions, which are ground-breaking steps in some ways - for example, the introduction of paid paternity leave, statutory paternity leave and pay - we would have liked to have seen some of the measures go a bit further. There could have been an opportunity to look more broadly at an integrated maternity and parental leave scheme, which would provide rights that were individually and equally available to both parents and would address the cultural perception that the care of young children is solely the preserve of women, as opposed to both partners. We want to give working parents more choice and flexibility. Our submission goes into more detail.
Dr Adamson: As the prime reason for maternity leave is to protect the health of the new mother and baby, why do you consider that the scheme should be equally and individually available to both parents?
Ms McSorley: Our counterparts in Britain also suggested this. We accept that as the primary reason, but we have concerns that extending maternity leave only, as opposed to a boarder choice of parental leave, may be perceived as being detrimental to women in practice. It could give rise to a situation where employers presume that all women of a certain age would want to take extended periods of leave for maternity reasons.
We are also concerned that there could be the argument that the 26-week leave period might be sufficient for the majority of cases - for recovery or health and safety reasons - and that the additional leave could be equally available to either parent, should the father choose to take that leave. There is no right and wrong, but we are concerned that there could be that interpretation.
Ms Harbison: From an equality perspective, it is important that we establish how important the role of a father is in relation to the upbringing of children. We are all concerned about the lack of male role models for young children in some instances, and it is important that we encourage fathers, as much as possible, to become involved at a very early stage with the growth and development of their child. Although the legislation may be for the health and welfare of the mother, we all need to be concerned about the health and welfare of the child, both psychological and physical.
The Chairperson: As a supplementary to Dr Adamson's question, are you prepared to say in detail what you are recommending? Are you saying that there should be an equal amount of up to 26 weeks, paid paternity leave, or are you saying that the 28 weeks should be transferable between the two parents as they choose - that could be 14 weeks each, 15 and 13 weeks each, or any permutation? Are you flexible on that point?
Ms McSorley: The 26 weeks is needed, and welcomed, for the mother from a health and safety and recovery point of view. We would have liked more of a debate about the subsequent 26 weeks, and feel that this could be open to the choice of either parent. In 20% of cases the mother may be the higher earner and, in those circumstances, it would make more economic sense if the mother could go back to work when she was fully recovered and the father could take the remaining leave. However, that would not be a good option for some couples if the leave were unpaid.
The Chairperson: You are not saying that the length of statutory paid paternity leave for both should be the same, but in any subsequent period over and above the 26 weeks' leave for the mother, there should be some scope for flexibility.
Ms McSorley: That would be best all round, and some countries have adopted that provision.
Mr R Hutchinson: You have suggested that additional maternity leave should not be dependent on a particular length of service, but what will the administrative burden be on small businesses? Would it be discriminatory against employers wanting to employ, promote or take the risk of a woman becoming pregnant, or, if she were pregnant, stopping her getting any further promotion? Are you not putting an unnecessary burden on small businesses?
Ms Harbison: I do not believe that we are. There are ways round that, and there are provisions in the Bill to deal with that. However, I am conscious of the fact that I am speaking to an all-male audience. This matter is absolutely fundamental to our society, and society must decide on the importance of maternity leave. There was a lot of discussion in the press recently about young women putting off having children until they were in their late thirties, when it becomes much more difficult for them to conceive and have children. We in Northern Ireland are a long way from not having a replacement rate for our children, but that danger is there. Society should be concerned about the effect that the lack of maternity provision and flexible working is having on women in the workplace.
Mr R Hutchinson: I do not disagree, but my following comments may seem as if I do. Northern Ireland is made up mostly of small businesses - it is a small business culture. Businessmen may agree with you totally; however, with the best will in the world, the practicality is that many small business people will say "This is not worth it: I am going to cut my losses, and that is it".
Ms Harbison: The legislation says you cannot do that.
Mr R Hutchinson: No, but these are your proposals. My wife and I have had children and we know about the trauma of childbirth and so on. I do not necessarily disagree with you, but this creates a terrible burden for the small businessman.
Prof Fitzpatrick: The Regulations will make it complicated for everybody, and we would rather have very simple rules that could be applied easily. However, parts of the economy cannot be excluded from that. In your scenario, either we do not regulate at all, or the Equality Commission gets a flow of people bringing discrimination cases, who suspect that they were not recruited because they were women of a certain age. It is swings and roundabouts. There should be discrimination law to deal with those situations, or it should be regulated in a simple, clear and effective fashion, which is what we are proposing.
Mr R Hutchinson: Then that puts the other person off.
Ms McSorley: From my experience of advising employers - mainly small employers - on sex discrimination, I was extremely pleased to see how willing and committed employers, large and small, were to providing equality of opportunity. However, they want, need and expect clarity in relation to what is lawful and what is expected of them, and help, guidance and support to provide that.
We were reassured by the consultation exercise, and the promise of support and guidance for small employers. We are conscious that there will be no financial cost to small businesses in relation to statutory maternity pay and the proposed paternity pay. Maternity and paternity pay are recoverable from the Inland Revenue - plus a 5% compensation payment. Therefore, the main financial costs are more related to how businesses find temporary cover. The Equality Commission hopes that, with the new flexible working conditions and the general move across Europe and the UK towards increased and improved rights for flexible workers, there will be a better-qualified and extended pool of appropriate people for those vacancies that small businesses find it difficult to fill.
Mr R Hutchinson: Employers can reclaim paternity pay. However, employers have visited my office in a panic because they have had to pay out such benefits. Although employers can reclaim the money, some petrified employers have approached me because the money is not paid out on the proper dates, and their cash flow is affected. That system only works if everything runs according to plan, and the problem is that the system does not always work.
Ms Harbison: The legislation should make it work, and that is what people must realise. The Regulations must be clear and must lay responsibility on people to meet their obligations in an appropriate manner, and it should not be beyond the capabilities of the public sector to deliver on that.
The Chairperson: As a point of information, Michelle Gildernew, a member of the Committee, is currently on maternity leave.
Mr Carrick: During your presentation you mentioned equality and equity, and the need to define the role of the father. We like to think that we have a clear definition of the role of the mother, but we must define the role of the employer in order to avoid situations such as that outlined by Roger Hutchinson. We are trying to develop a social pact to ensure a work/life balance. The Committee has taken evidence from the Federation of Small Businesses and various trade unions, and they may propose some amendments. Does the Equality Commission anticipate some amendments to improve the equality aspect of the Bill? In the interests of equality and equity, does the Equality Commission feel that any of the costs that result from the introduction of the Bill should be subsidised by the small business sector of the Northern Ireland economy?
Ms Harbison: This is a societal question, and we are all part of that society. I take Mr Hutchinson's point, but that situation should be manageable; it should not happen. We all have a contribution to make, and it is our social responsibility to do so. Although the legislation should not place an inordinate burden on employers, we must all take a share in the responsibility of protecting future generations.
Mr Carrick: Is it your view that taxpayers, as opposed to individual businesses, should finance the administrative and financial burden of introducing the new elements?
Ms Harbison: That is getting into really deep politics. The commission has not discussed that issue, and I am not sure whether Ms McSorley or Prof Fitzpatrick will want to add anything. My own perspective is that, if we are to address this as a society, politicians must lead us. Politicians must take those decisions, tell us that they are necessary, and persuade the unpersuaded that they are important for the future - especially for the future of Northern Ireland.
Prof Fitzpatrick: All those provisions are based on statutory levels of maternity pay. I studied the pregnant workers Directive as it passed through the EU institutions. One unnamed member state was insistent that maternity pay should be at that level. There were long debates and conflicts with the Parliament, for every other state would have paid anything between 50% and 80% of earnings during those periods.
My understanding is that the United Kingdom already has the lowest level of maternity pay in western Europe. Small businesses are competing against larger businesses, perhaps leading to disproportionate effects, but these measures will apply across the United Kingdom. I presume that the Republic of Ireland has similar measures.
A small employer receiving a payback from the state for those payments has the least financial burden of any such employer in Europe where EU Directives apply. We are concerned that the take-up will be low in the United Kingdom. Given the low level of work and wages patterns, it will be even lower for paternity leave than for maternity leave. We want more realistic levels of pay, with some money coming from the state and some from the employer.
Mr Carrick: I am not calling the quantum into doubt, for in most cases it will be fully reimbursed. However, I should like to know how small employers would be recompensed for the administrative burden, dislocation and upset associated with the additional cost.
Ms Harbison: Ms McSorley has already covered that. We hope that other measures will provide a means for the gap to be filled. Our great worry is that the take-up will be very low and that the Bill will, therefore, not have the effect which one would like. From that perspective, it is quite important that there be political leadership and that recognition of the need for such a level of commitment be voiced.
The Chairperson: The Deputy Chairperson, Mr Carrick, asked about amendments. I should be grateful if you could send any potential amendments to the Committee before the end of August, when it will consider whether to amend the Bill in any way. We have asked previous witnesses to do that also.
Prof Fitzpatrick: The commission is about to assume jurisdiction over employment discrimination on the grounds of sexual orientation. We are aware that there may in certain situations be complications as to whether it is applied to same-sex as well as opposite-sex partners. We might wish to examine that more closely before giving a written submission on the point. The statutory equality duty applies to sexual orientation. We considered the Committee's equality impact assessment, and there do not seem to be any issues on that point. However, we should like to examine that more closely before giving the Committee a written submission.
Ms Harbison: There may be other areas where we are concerned about deficiencies or what we perceive as such. Does the Committee desire a response by the end of August?
The Chairperson: Yes. The Committee will not meet again until September.
Ms Harbison: We shall let the Committee know one way or the other so that it has a response of some sort.
Mr Dallat: You have heard the Committee's negative concerns about the Bill. You said that you are concerned that there may be a low uptake. We are simply playing catch-up with other communities. How can we put a positive spin on this legislation so that small employers - indeed all employers and employees - appreciate its benefits? The other direction would be for the black economy to take centre stage again. In the past, employers frightened of income tax and National Insurance contributions paid wages under the counter. A great deal of time and discussion have gone into the Bill, and if it is to affect people's lives positively, there must be more to it than such concerns as single-sex relationships.
Ms Harbison: Ms McSorley spoke about that. I began by saying that I wanted clarity. One of the Minister's commitments when he introduced the Bill was to give guidance to employers. Guidance and publicity, the sort of work that Ms McSorley has carried out in the former Equal Opportunities Commission (EOC) and now in the Equality Commission, lead us to believe that employers are ready to fulfil their obligations and contribute to society. They do not want to have to take the information home and pore over language that they simply do not understand. They want it in the form of a flow chart showing what they can do and how they should do it point by point. There are ways in which we can encourage and help small employers to meet their obligations; it is incumbent on us all to do so.
Prof Fitzpatrick: The reconciliation of working and family life makes for better workers. If people are not given this sort of leave, it will affect how they work. People will also use sick- or annual-leave provisions to deal with other situations, something that has a knock-on effect on such leave elsewhere. A sensible leave system covering the purposes for which people want time off is better than their taking leave regardless of the rules, and self-certifying when the employer knows that they have a newborn baby. Without a proper leave system, people will take annual leave at inconvenient times because of personal circumstances. Developing better employees, and producing a coherent system of leave for the reasons for which people want to take it, are aims that apply as much to small employers as to large ones, and we are promoting the new arrangements equally to both.
Mr Dallat: I wish to pursue the matter, for we are entering the old realm of equality. For years, those in professions such as the Civil Service and teaching simply got time off work if there was a crisis at home. That did not apply to people at the lower end of the employment scale. There is now an opportunity for us to provide for everyone, but the Bill seems a rather dull piece of legislation. Where is the mechanism for delivering to those to whom it matters most? I am not talking about people who can get the time off, but those in manual jobs who cannot. I am sorry if that sounds cruel, but it is a perfect example.
Ms Harbison: We have a great many concerns. We have talked long and hard about people in low-paid, low-status jobs, who are some of the most marginalised members of our society. They are entitled to the same rights as anyone else. However, such jobs are not only found with small employers.
Mr Dallat: I am not sure how the matter of small employers entered into the discussion.
Ms Harbison: I am sorry. Perhaps I was mistaken.
Ms McSorley: There is a great deal of informal provision.
Mr Dallat: That is the word that I should have used.
Ms McSorley: The Bill will not require many employers to do any more than they do already. It could be argued that the more positive employers retain their workforces. Publicity will be a major challenge for the Government, as acknowledged in the initial consultations on the Green Paper on Work and Parents. Consultees were asked about requirements, and all were clear that an education exercise was needed to effect a cultural change on the part of employers and workers. They need guidance and support to enable them to do that. Employers large and small must be reminded of the benefits.
We argue that what is good for large business is also good for small business. In some cases, flexibility can be delivered more easily in smaller concerns. Traditional ways of working sometimes have to be challenged to reach the desired situation. The Bill is a stepping stone to a better position.
Mr McElduff: My concern is for the excluded individuals and categories, and how the different treatment of employees on the part of certain employers can be addressed. Does the failure to get the work/life balance right have health and safety implications?
Prof Fitzpatrick: I mentioned that differential in my opening remarks. The definition of "worker" is very wide. If you are not in business on your own, with customers and clients, you are a worker. Agency workers such as on-call workers' or casual workers of various descriptions, may not fit into that definition because of the triangular relationship involved. Having been a tribunal chairman myself, I can say that being defined as an employee depends on the discretion of those who are sitting.
The most vulnerable members of the workforce are in doubt as to whether they are protected. A tribunal may be required to determine that, but the most vulnerable people in society are least likely to go to a tribunal. There are detriment measures in the Bill to deal with people claiming their rights. However, even with that type of detriment provision in place, people in employment may not always attempt to have their rights enforced.
The Equality Commission does not have jurisdiction over those statutes. We should like to be given jurisdiction over such equality-related matters in a single equality Bill, given that they are so close to equality questions that people come to us. A casual worker might come to us alleging a case of indirect discrimination, but if the legislation had applied to workers, he or she would not have had to trouble us.
There may be issues related to health and safety. Some aspects of working time Regulations are governed by health and safety inspection. Those rights might be enforced through inspection processes rather than through individuals bringing their cases to tribunal.
The Chairperson: Can you envisage any implications under section 75 of the Northern Ireland Act 1998 arising from the right to request flexible working, which, as drafted, is limited to parents with children under the age of six or disabled children under the age of 18? What about equality issues relating to parents of older children or carers of adults?
Ms Harbison: We are concerned about that and about extending provision only to parents of children under six. It raises issues under section 75.
Ms McSorley: In our submission we said that we should like to see the right being made available to parents of children of compulsory school age. There was a suggestion in the Bill that Regulations could provide for an alternative cut-off point. The commission certainly feels that the right should be made available in relation to disabled children while they remain dependent.
Mr Carrick: I should like to ask a question on the employee-versus-worker issue. Should that be the basis of an amendment? If so, would it cover self-employed workers? Would you have to divide those who work for an employer from those who work for themselves? Does that not pose a problem?
Prof Fitzpatrick: It still poses a problem, but it catches many casual workers. Employment law has not developed to meet the variety of employment relationships that have proliferated over the past 10 years. There is a genuine question concerning people who might be self-employed for tax purposes and who are still not in a client relationship with the person employing them - they would be included as "workers" under the definition.
The legislation moves the goalposts so that there is much less controversy. It catches some very vulnerable people who are clearly not employees but workers. It tries to draw the line at the genuine self-employed rather than those who have subservient relationships of various descriptions without coming within the definition of "employee".
Mr Carrick: If we use the term "worker", we specifically exclude the self-employed unless we can find a mechanism to include them. It has its origin in the Inland Revenue definition, which is that of a relationship between master and servant. Is that a definition with which you go along?
Prof Fitzpatrick: That is the definition of an "employee". Terms such as "mutuality of obligation" cater for people such as casual workers who need not legally turn up or be employed. However, they do indeed turn up, for they need the work and are employed when they do so.
That level of legal semantics means that quite vulnerable people are not protected in the same way as more established workers. On the equality front, though we cannot say for sure, we suspect that many of those in more vulnerable positions are women. Such women are, therefore, losing out. With so many other areas of employment law being driven by the term "worker", it is disappointing that the Bill is returning to the term "employee". "Worker" would be much more consistent and appropriate.
Mr Carrick: Do you not feel strongly enough to suggest an amendment?
Prof Fitzpatrick: We should be perfectly happy to propose one to you.
The Chairperson: Thank you. That was very helpful.
