COMMITTEE FOR EMPLOYMENT AND LEARNING

Report on the Employment Bill

NIA Bill 11/01 (Continued)

Report: 1/02R

Present: Dr Esmond Birnie MLA (Chairman)
Mr Mervyn Carrick MLA (Deputy Chairman)
Dr Ian Adamson MLA
Ms Michelle Gildernew MLA
Mr David Hilditch MLA
Mr Barry McElduff MLA

In Attendance: Dr Andrew Peoples
Mr Colin Jones
Mr Paul Stitt
Mr David Douglas

Apologies: Mrs Joan Carson MLA
Mr John Dallat MLA
Prof Monica McWilliams MLA

Members noted further information from the Equality Commission with regard to the definition of the term ‘worker’ in employment legislation.

Members noted a further Assembly Research paper detailing a list of categories which might be included in any definition of ‘workers,’ and outlining the impact of potential amendments to the Employment Bill on previous and parallel legislation.

The Chairman stated that at his recent meeting with the Minister, she had outlined several difficulties with the Committee’s proposal to extend the scope of the Employment Bill from ‘employees’ to ‘workers.’ Such an amendment, to extend the range of persons eligible for social security benefits, would require consequential amendments to supporting legislation within the remit of the Department for Social Development. An amendment to include ‘workers,’ some of whom did not pay National Insurance Contributions may also require new legislation to implement a system to compensate employers, as they were currently compensated via the National Insurance scheme. The Minister had again expressed her concerns at the risks attached to delaying the passage of the Bill through the Assembly, in that the necessary supporting subordinate legislation would also be delayed. She had also stated that the Employment Bill included powers to extend the scope of the legislation, if required, in the future and, indeed, her Department had currently put out to consultation two policy documents relating to ‘Employment Status in Relation to Statutory Employment Rights’ and the ‘European Union Commission’s proposal for a directive on Working Conditions for Temporary Agency Workers’ which would allow views to be assimilated in these areas.

The Chairman further stated that widening the scope of the Bill from ‘employees’ to ‘workers’ might also require amendment to the Social Security Bill which was currently being considered by the Assembly under accelerated passage. He considered that it was not practical to proceed with widening the scope of the Bill from ‘employees’ to ‘workers,’ but that the Committee’s Report should highlight the fact that such a proposal would be considered in the future and the Committee would investigate this area further in its deliberations on the consultation documents detailed above.

The Chairman also stated his opinion that the Committee should not extend the scope of the Bill relating to the right to request flexible working as, although this was a new right which would not have consequential effects on existing legislation, to do so would create a contrast in the Bill and such issues could also be considered in the current consultations, which could lead to better and more consistent legislation and associated definitions.

Mr McElduff enquired about the possibility of delaying the clause-by-clause scrutiny of the Bill to enable members to seek further advice on the reported developments. The majority agreed that, as individual members could table amendments to the Bill as it proceeded through the Assembly, and given the general shortage in time, the Committee should continue with its deliberations to ensure early completion of the Committee Stage. Ms Gildernew sought and received the Chairman’s assurance that this would be fully documented in the draft Committee Report on the Bill which needed to be agreed by the Committee before printing.

The Chairman welcomed Mr R Gamble and Mr W Caldwell from the Department for Employment and Learning (DEL) to assist members in their scrutiny of the Bill.

The Committee commenced formal clause-by-clause consideration of the Employment Bill.

The question was put:

The question was agreed to.

The question was put:

The question was agreed to.

The question was put:

The question was agreed to.

Mr Gamble informed members that, contrary to the Minster’s letter which was in front of the Committee, the Employment Bill did not contain power to extend employment rights via subordinate legislation in the future. This enabling power was, however, contained in other primary legislation.

The question was put:

The question was agreed to.

The question was put:

The question was agreed to.

The question was put:

The question was agreed to.

The question was put:

The question was agreed to.

The question was put:

The question was agreed to.

The question was put:

The question was agreed to.

It was proposed by Mr McElduff:

The question was put and the proposed amendment fell as detailed below.

The Committee divided: Ayes: 1; Noes: 4.

Ayes: Mr McElduff.

Noes: Dr Adamson, Dr Birnie, Mr Carrick, and Mr Hilditch.

Abstentions: None.

The question was put:

The question was agreed to.

It was proposed by Mr McElduff:

The question was put and the proposed amendment fell as detailed below.

The Committee divided: Ayes: 1; Noes: 4.

Ayes: Mr McElduff.

Noes: Dr Adamson, Dr Birnie, Mr Carrick, and Mr Hilditch.

Abstentions: None.

The question was put:

The question was agreed to.

The question was put:

The question was agreed to.

It was proposed by Mr McElduff:

The question was put and the proposed amendment fell as detailed below.

The Committee divided: Ayes: 1; Noes: 4.

Ayes: Mr McElduff.

Noes: Dr Adamson, Dr Birnie, Mr Carrick, and Mr Hilditch.

Abstentions: None.

The question was put:

The question was agreed to.

The question was put:

The question was agreed to.

The question was put:

The question was agreed to.

The question was put:

The question was agreed to.

The question was put:

The question was agreed to.

It was proposed by Mr McElduff and seconded by Dr Birnie:

The question was put and the amendment agreed as detailed below.

The Committee divided: Ayes: 3; Noes: 2.

Ayes: Dr Adamson, Dr Birnie and Mr McElduff.

Noes: Mr Carrick and Mr Hilditch.

Abstentions: None.

The question was put:

The question was agreed to.

The question was put:

The question was agreed to.

The question was put:

The question was agreed to.

The Clerk was directed to produce a draft Report for consideration at next week’s meeting.

DR ESMOND BIRNIE MLA
Chairman, Committee for Employment and Learning

Present: Dr Esmond Birnie MLA (Chairman)
Mr Mervyn Carrick MLA (Deputy Chairman)
Mrs Joan Carson MLA
Mr Michael Coyle MLA
Mr David Hilditch MLA
Mr Roger Hutchinson MLA
Mr Barry McElduff MLA
Prof Monica McWilliams MLA

In Attendance: Dr Andrew Peoples
Mr Colin Jones
Mr Paul Stitt
Mr John McVey (Northern Ireland Assembly Research)

Apologies: Mr John Dallat MLA
Ms Michelle Gildernew MLA

The Chairman informed members that the minutes of evidence of last week’s meeting were not yet available from Hansard and that the Committee would consider these at the next meeting.

Members agreed to forward copies of the Committee’s Report on the Employment Bill to all witnesses and to the press, embargoed until the Bill reached Consideration Stage in the Assembly. It was also agreed that a copy should be forwarded to the Minister for Employment and Learning.

Mr McElduff agreed to second the proposal that the draft minutes of the meeting on 12 September 2002 be approved.

Members carried out the final reading of their Report on the Committee Stage of the Employment Bill.

Members authorised the Clerk to make any minor editorial changes necessary during proofing of the Report.

DR ESMOND BIRNIE MLA
Chairman, Committee for Employment and Learning

Thursday 13 June 2002

Dr Birnie (Chairperson)
Mr Carrick (Deputy Chairperson)
Dr Adamson
Mr Dallat
Mr A Doherty
Mr Hilditch
Mr R Hutchinson
Ms McWilliams
Mrs Nelis

Mr D Munster )
Mr W Mitchell ) Federation of Small Businesses
Mr G Roberts )

1.

Ms McWilliams: There is currently another meeting, that of the Ad Hoc Committee on access to justice. That may or may not be quorate, and I apologise in advance if I have to go in and out for that reason.

2.

The Chairperson: I welcome the delegation from the Federation of Small Businesses (FSB), Mr David Munster, Mr Wilfred Mitchell and Mr Glyn Roberts. Thank you for coming. This is the first formal evidence session in the Committee Stage of the Employment Bill. I thank you for the written evidence which you supplied and the document which you launched recently. Perhaps you could make a short statement before taking questions.

3.

Mr Mitchell: Do you want us to run through what we submitted?

4.

The Chairperson: Whatever you feel happy with is fine.

5.

Mr Mitchell: The FSB welcomes the opportunity to contribute to the Committee’s consideration of the Employment Bill. We are the largest group representing the interests of the self-employed and those who direct businesses in Northern Ireland. The federation has 170,000 members nationally, of which almost 3,000 are based in Northern Ireland. It is run by businesspeople for businesspeople, and is funded solely by member subscriptions. The membership in Northern Ireland elects a policy committee, which is supported by a full-time policy officer. We also run a full-time press and parliamentary office.

6.

The FSB recognises and welcomes the positive aspects of the Bill. However, it has many concerns about how it will affect the small business community, which is the backbone of Northern Ireland’s economy. We are disappointed that the Bill does not distinguish between large and small employers. We are gravely concerned that it does not address the inequalities faced by the self-employed.

7.

There are many ambiguities in the Bill. For example, it does not address how employers can claim back administration costs. Implementing costly regulations on the large proportion of the business community which already recognises and offers flexible working policies over and above the current statutory standards would not be in the best interests of employers or employees in Northern Ireland.

8.

For the purposes of the submission we shall concentrate on the three areas of greatest importance to the small business community: flexible working; simplification advice and guidance; and managing absences.

9.

Mr Roberts: The legislation is intended to give working parents with children under six or disabled children under 18 who have been with their companies for a minimum of six months the right to make written requests for flexible working. Companies can reject the requests, but they must set out a considered business case for doing so. Employees will be able to seek redress from an employment tribunal if they feel that their requests have not been taken seriously. Tribunals will be able to rule only on procedures, facts, and whether a business case has been made.

10.

If employers follow correct procedure, they are unlikely to see their decisions overturned by the tribunal. Nevertheless, the consequence of the proposal is likely to be an increase in employment tribunal applications from employees who feel that their employer has failed to give adequate consideration to their request to work part-time. The measure’s implications are directly contrary to the Bill’s objective of reducing the number of employment tribunal applications.

11.

We recommend that the resources be geared to educating and supporting businesses which do not already have flexible working policies or the in-house expertise required to implement them. There should be a clear focus on helping those businesses which do not recognise the competitive benefits of doing so.

12.

In a large company, cover can easily be arranged, often from within the same department, and if a temporary worker is needed, that can easily be afforded. However, for a small business with, for example, four employees, a member of staff on leave represents 25% of the workforce. It should be recognised that in small firms, each worker plays a key role, one that often requires specialist training. In fact, one worker may constitute a whole department. If a key worker is absent, the owner of the business will not only have to take on cover, but spend time training that temporary employee.

13.

The simplification of current regulations to reduce the complexity of red tape would be welcomed by the business community, since a one-off cost must be more economical than introducing systems with continual costs to both the Northern Ireland economy and the business community. On advice and guidance, we should like to see suggested options available with targeted distribution of flowcharts, maternity leave, contracts and guidance setting out the rights and responsibilities to the business which will benefit from it.

14.

For much of the legislation, the implications of introduction will depend on the payment mechanisms adopted. The worry is that, if Government continues to regulate, the burden of administrative costs on the business community will become unbearable. In the context of the Bill, we feel that payment mechanisms are not the key area for focus. We wish to stress that small businesses strongly resent being unpaid tax-collectors. The whole issue of tax collection by small businesses must be addressed by Government.

15.

Our final point concerns managing absences. That is the key to moving successfully towards a more flexible working culture. Advice and guidance on managing absences must focus on supporting the education of businesses so that they develop best practice in the workplace, as well as examining relationships with employment services and private recruitment agencies. If the Department wishes to support the development of flexible working, it must allow individual businesses the opportunity to explore flexible working options which fit the employee but not the company.

16.

If implemented, the legislation would restrict employees’ opportunities for flexible arrangements and restrict business development by imposing impractical routines on employers and reducing profits, as well as inflicting unnecessary regulatory costs. The Committee will be aware of the amount of regulation and red tape with which businesses, particularly small businesses, must work; resentment would build. One thing that contradicts the whole idea of the Bill is that it will encourage recruitment discrimination against men and women of childbearing age. It will also discourage the business community from positively embracing the culture of work-life balance.

17.

Mr Munster is our spokesman on this area and deals with the issue as a small businessperson with 26 employees. He can discuss the other day-to-day problems which businesses will face because of the Bill.

18.

Mr Carrick: Small businesses are the unpaid collectors of National Insurance, tax, statutory maternity benefit, statutory sick pay and student loan repayments — the list is long and looks set to grow. How far can small businesses go before the straw that breaks the camel’s back?

19.

Mr Munster: That will obviously differ from one business to another. In my experience, a great deal of my time is taken up with ensuring that we comply with all the regulations. My primary focus is to ensure that we sell enough to make sufficient profit to cover wages and the other costs of running the business. I am spending an increasing amount of time dealing with such issues simply to ensure that I am on the right side of the law. That is not productive time, and it will ultimately affect profitability.

20.

It will vary from business to business. I am concerned about us becoming uncompetitive vis-à-vis businesses in the Republic. I am also concerned that I might become uncompetitive against national companies in the same line as ourselves.

21.

Mr Carrick: In the context of administering the Employment Bill proposals, have you any suggestions as to how the Government could deal with that issue without imposing a burden? In the past, the compensation paid to small businesses has been paltry.

22.

Mr Munster: Take paternity pay, for example. When I had children I was an employee, and I wanted to have time off. I used part of my annual leave, and there was no administrative burden on the company whatsoever. I do not see any need to introduce legislation to ensure that the employee gets paid that, no matter how it is done, ends up being complex, meaning the money must be claimed back through National Insurance. It all adds to the burden. The other option, which we refer to in our paper, is a mechanism whereby the employer is compensated for that extra work. My preference would be for simplicity.

23.

Mr Mitchell: Nationally, the federation does not want to be compensated, since there is an attendant burden of responsibility, and we do not know where that would end. We should rather that the Government took ownership of the matter.

24.

Mr R Hutchinson: We all know the importance of small businesses in Northern Ireland. They employ a large number of people. In the federation, what percentage of businesses have some kind of inbuilt structure for such matters as maternity leave and flexible working hours?

25.

It has been suggested that additional maternity leave should not depend on a woman fulfilling a qualifying service condition. If that were introduced, how would it impact on small businesses?

26.

Mr Munster: You asked whether we have systems in place. I suppose that we all have to deal with such things when they arise, but it is very difficult to have a mechanism in place for every eventuality when you employ a small number of people. In general, there will not be a system as such. We simply have to examine the rules and regulations and deal with them at the time.

27.

On the issue of employees who have not served the existing qualifying period for extended maternity leave, we are concerned about people’s increasing right to be absent from work, rather than, in this particular case, the cost of administering it. A key person in my business has taken maternity leave, and I have had to bring in a temporary worker — it must by law be a temporary worker, because you have to keep the job open. When it is a key position, that person has to be trained. It is very difficult to get a temporary worker capable of doing such a key job. The person was in charge of my purchase ledger. There was a disaster when we were paying suppliers whom we should not have been paying, and not paying others whom we should have.

28.

Mr R Hutchinson: You had never done that before.

29.

Mr Munster: You can understand that being of concern to me. That is a cost. The Bill contains an analysis of the actual cost of paying out the money. The cost is not the main issue, however — it is the disruption caused by people being away from the business.

30.

Mr R Hutchinson: Will some businesses decide that it is not worth the hassle and cut their losses? Will it be the straw that breaks the camel’s back?

31.

Mr Munster: It is more likely that people will make a negative decision on whether to recruit, where otherwise they would have made a positive decision.

32.

Mr Hilditch: In relation to the impact on colleagues and fellow workers who remain in the workplace, in your own case you envisaged agency workers being brought in. Others may not be able to afford such a luxury, and that may cause stress to the remaining workforce, at which point sickness will kick in. That is a concern.

33.

Mr Munster: Mr Roberts made a point on work-life balance. Flexible working hours are designed to enhance that. However, the stress and strain which it causes to other employees affects their work-life balance, since they are trying to make the business work when it is understaffed.

34.

Mr Hilditch: It therefore imposes a practical and financial burden.

35.

Mr Munster: Unlike a football team, businesses cannot carry an extra 22 people from whom they pick a team of 11. The people required to run the business — and no more — must be employed, and any absence puts a strain on the remaining workers. We are talking about legislating for additional absence, and that will increase the strain.

36.

Mr Hilditch: The compensation factor might kick into the argument if an extra person were brought in.

37.

Mr Munster: If a person is to be absent only for a relatively short period of time, it is not practical to bring in and train someone. It would be worthwhile only if someone were off for a longer period. The difficulty with maternity regulations as they stand is that it is not known until after the baby is born if the employee is coming back at all.

38.

Dr Adamson: I have worked a rota system for most of my life as a medical doctor. On one occasion I worked for six months on a one-on-one rota, which sounds strange, but people were sick or on maternity leave — or simply left the country during the latter part of the troubles.

39.

The proposed legislation gives some people with caring responsibilities the right to request flexible working, but not others, such as parents with disabled offspring over 18 and those caring for elderly or sick parents. Do you consider that discriminatory, especially for small businesses?

40.

Mr Munster: The impact on small businesses will be greater than that on larger ones, where there is an ability to cover absences. Whether the proposals discriminate against other groups of people who might make a valid case for taking time off work is not at issue. My concern is that we keep in mind a new group of people for whom we wish to provide. There have been test cases in relation to equality, which have established that either parent can have time off if a child is sick. Many rules already exist, and any additional regulations make the situation difficult. As employers, we are not unreasonable in helping people or allowing them time off, but there is no protection for the business — the legislation and the protection is directed at employees’ interests. If someone is to be away from the business, it might mean losing a new contract. There is no recourse for the business in that case.

41.

Mr Munster: That is where the imbalance lies.

42.

Mr Dallat: When this Employment Bill was debated in the Assembly, I expressed many of the concerns of small businesses — and of course you know my position. I attended the launch of those documents in the Odyssey. I am concerned at certain things which have been said today. Given the abuses against employees on the part of certain of your larger rivals, is a proper Employment Bill not absolutely necessary to protect them against the appalling conditions under which they have had to work?

43.

Mr Munster: Are you speaking historically?

44.

Mr Dallat: I am not going back very far. I speak of some of the recent arrivals, whom I do not wish to name.

45.

Mr Mitchell: We have stated in this document that there should be a difference —

46.

Mr Dallat: They are not members of your federation.

47.

Mr Munster: Such things impact on small employers quite differently from how they impact on large employers. We are not in any way against having some kind of protection mechanism to ensure that those employees are treated fairly. We are concerned about over-regulation and feel there is already too much. All we are doing is making that worse.

48.

Mr Dallat: We have recently heard evidence from employers — many of them small businesses — about their difficulty recruiting. To attract people into the small businesses which you represent, is it not important that they have the best possible working conditions, particularly regarding maternity leave? I was shocked to hear that some members might not recruit women of childbearing age out of fear that they would have a baby. As a mere man, that really —

49.

Mr Munster: You are misinterpreting that remark slightly. The matter does not concern members of the FSB exclusively. It can have the exact opposite effect to that which you desire. I am being devil’s advocate here, and I stress that I am not talking about myself or any member of the federation. However, if an employer has a choice between two candidates — one not long married and another slightly older — that might be in the back of his mind. I am pointing out the fact to you rather than suggesting that we should do it.

50.

Mr Dallat: I am asking these questions for my own benefit. You said that you wished to remain competitive against businesses in the Republic. This legislation is all inspired by European law. Is there any evidence to suggest that businesses of similar size in the Republic are not playing the game properly, or that the jurisdiction has no such legislation?

51.

Mr Roberts: That is not a question on which I could provide you with evidence. I was merely flagging up our need to remain competitive. We must examine the experiences of our colleagues in the Small Firms’ Association and other small business organisations in the Republic. If the Committee were interested, we could provide the evidence in written form.

52.

Mr Dallat: You are giving evidence to this Committee now, and one assumes that you have done your research.

53.

Mr Roberts: It is not possible for us to know the exact legislative situation in the Republic. We have considerable difficulty keeping track of this Assembly, never mind the Oireachtas.

54.

Mr Dallat: Perhaps enough has been said on the issue. Ultimately, we surely want an Employment Bill which affords employees protection against the rogues, of which there are plenty — not the fine, honourable members of your federation. I know from personal experience that some people believe that they are still in Victorian times, treating employees as they please. The Bill is necessary. However, of the criteria, only three ask for guarantees.

55.

Mr Munster: As I said in my point about maternity leave, the FSB is not convinced that extra regulation is needed in those areas. Mr Dallat said that people have difficulty trading. Therefore, if employers want to retain good employees in the competitive employment marketplace, they will treat them fairly, without regulation.

56.

Mr Dallat: I am not suggesting that men are the rogues in that area. Last night, three young students came to me. They had been unable to attend college for several weeks, and because it is the end of term they were asked to go to college for an extra day. Their employer, who is a woman, sacked them. Therefore, among the employers are people who abuse employees.

57.

Mr Roberts: The FSB is not completely opposed to the Employment Bill. There are details in the areas it would like to consider which, in its experience, represent its 3,000 members. The FSB urges all employers to respect their employees. The FSB employs 130 staff nationally; its 3,000 members in Northern Ireland employ hundreds of thousands more. Therefore, the FSB encourages businesses to follow good practice, stay within the law and ensure that their employees are given every protection under it.

58.

Mr A Doherty: I am a new member of the Committee and inexperienced in this subject. In your submission you expressed disappointment that the Bill does not distinguish between large and small firms. There is a vast gulf in the scale of the problems faced by a firm that employs up to 10 people and a large multinational. Is there a clear dividing line between what constitutes a large firm and what constitutes a small firm? Is it realistic to think that the Bill could make a fine distinction between the two? Could there be different legislation for a firm which has 1,000 employees; one which employs 100 people; and a self-employed businessman?

59.

Mr Munster: There is scope, without being too complex, to determine what would affect businesses with different numbers of employees. However, the impact on a small business is proportionately higher, and the needs and concerns of small businesses are not taken into account. Small businesses are treated in the same way as those which employ more than 1,000 staff.

60.

Mr Mitchell: The FSB accepts membership from businesses with up to 150 employees, which seems quite large. However, in Europe and the UK, 97% of businesses employ fewer than 10 people. The FSB deals with new starts employing one or two people. It wishes to provide reasonable treatment so that an entrepreneur, who is not an expert in working with employees, will be encouraged to employ people. We do not want entrepreneurs to receive a raft of regulations that they read and decide that they are not interested. For example, if a young electronic engineer thinks of an idea and wants to manufacture a product, he must employ people. The FSB wishes to encourage that.

61.

Ms McWilliams: I want you to take my questions in good spirit. If I went for a job in your company, would you think that I was a woman of childbearing age?

62.

Mr Munster: It is not a case of being of childbearing age; it is a case of whether you are likely to have children.

63.

Ms McWilliams: How do you make that judgement?

64.

Mr Munster: I am not suggesting that a judgement should be made.

65.

Ms McWilliams: I noted your words "encourage recruitment discrimination against men and women". I will deal with the women first.

66.

Mr Mitchell: ‘Time’ magazine has stated that a certain age group is likely to be infertile.

67.

Ms McWilliams: I know all about that.

68.

Mr Mitchell: A medical position has been stated.

69.

Ms McWilliams: What is it?

70.

Mr Mitchell: ‘Time’ magazine said that 90% of women over the age of 42 would have infertile or defective eggs.

71.

Ms McWilliams: So you would make that judgement?

72.

Mr Mitchell: No, that is what ‘Time’ magazine said.

73.

Ms McWilliams: What about men? Would Dr Adamson be a man of childbearing age?

74.

Mr Dallat: Oh yes.

75.

Mr Mitchell: Fertility also drops off with men according to ‘Time’ magazine.

76.

Ms McWilliams: Do you see the point that I am making? There is variation. You make the point about men of childbearing age and then you reflect on women of childbearing age. There is a big difference when you consider men of childbearing age. The population shrinks further when you refer to women, and it shrinks even further when you refer to people being of high fertility.

77.

I like your statement that employers deal very fairly. That was the view even before legislation was introduced and the reason why it was introduced. The Sex Discrimination (Northern Ireland) Order 1976 and Equal Pay Act 1970 were introduced, and I accept that they have probably increased the Regulation burden on you. However, has that legislation benefited the labour market?

78.

Mr Munster: Are you asking whether it has increased the opportunities for women?

79.

Ms McWilliams: I am thinking of issues such as equal pay for work of equal value.

80.

Mr Munster: The statistics show that there is still a gap between what women and men earn on average, but the gap has narrowed. That would suggest that the legislation has benefited women. However, people are becoming more enlightened and aware of the fact that women are capable of doing just as good a job as men, and that is more likely to have had an effect.

81.

Ms McWilliams: The legislation was introduced because there was such a variation in the way people were being treated. Basic guidelines or Regulations were introduced to deal with that. Comparative studies show that the measures have retained the labour force, there is a higher level of loyalty in the labour force, and, in some instances, productivity may have increased.

82.

Mr Munster: That is as a result of retaining more women in the workplace.

83.

We are focusing on legislation that gives people rights to more time off work, as opposed to more time in work. We are focusing on the difficulties that having more time away from the job would cause to a business, rather than on whether women should have equal rights to men.

84.

Ms McWilliams: I accept that. However, would you not anticipate that women might stay longer instead of dropping in and dropping out? With the same employee from start to finish, you would save on training, recruitment and advertising costs. The turnover of staff would not be so high — people would not drop out and not come back, and the situation where those who had shorter maternity leave took time off on sick leave, or did not return at all, could be avoided. Some of the research suggests that it would be beneficial to introduce the proposed measures.

85.

Mr Mitchell: Did your research show whether that applied to a large company or small company?

86.

Ms McWilliams: It suggests both. Obviously, the larger companies can cover matters on a corporate basis. Your argument is that the provisions would result in an extra administrative burden. That is your difficulty, rather than the costs involved, because under the legislation the costs would be recouped.

87.

Mr Munster: It is the administrative burden, and the fact that administering the provisions means being diverted from what you are in business to do. There is also the disruption caused by people not being at work when you need them to be.

88.

Ms McWilliams: Yes, but if they were to give up completely and not come back, you would have a higher turnover — or you would go down the road of employing men only.

89.

Mr Munster: Because of the extended right to come back to work — there is no obligation, for practical reasons, for an employee to make that decision right away — it is extremely difficult to cover a position knowing that you will be bringing someone in on a temporary basis. You have, by law, to keep the job open for the person going off on maternity leave. In that sense, it would be preferable if the individual simply left, because you could then recruit someone to do the job on a permanent basis.

90.

Ms McWilliams: But that is not what is being introduced in this legislation. Those provisions are already in place, so we cannot go back and change them.

91.

Mr Munster: I know that; I just do not want to make the situation worse.

92.

Ms McWilliams: If you bring someone in on a temporary basis, you still have your problem. All that happens is that that person would stay longer when you give extended maternity leave. That might even defeat your own argument.

93.

Mr Munster: I do not think so. If the temporary person were not doing the job in the way that the permanent employee would did it — which was the experience that I had — it would be a potentially disastrous situation.

94.

Ms McWilliams: You had a bad experience, but can you envisage circumstances where you would not have such a bad experience? Those provisions are already in legislation.

95.

Mr Munster: It very much depends on the position held by the employee going off on maternity leave. The legislation obviously does not take account of that aspect, but if the job can be done by a vast number of people and does not require a great deal of training or knowledge about a company’s needs, then you could bring someone in on a temporary basis. However, if someone is doing a key job and they are away from that job, it could potentially put a company out of business. The smaller the business, the greater the extent to which that would apply.

96.

Ms McWilliams: What worries me is that you are making an argument against paying maternity pay or giving maternity leave at all.

97.

Mr Munster: I am making an argument against making matters more difficult for businesses than they currently are. I am not arguing against maternity leave. People obviously have to have maternity leave, and they have to have protection from being discriminated against because they have a baby. I am simply arguing against making the situation worse.

98.

Mr Roberts: I recognise the points that Prof McWilliams has made. As a business organisation, we work very closely with the Northern Ireland Human Rights Commission; we are part of the bill of rights consortium and are involved in the debate about a bill of rights; and we are playing a full role with the Equality Commission for Northern Ireland. We want to be part of the solution to this problem. We are simply giving the collective view of almost 3,000 small businesses in Northern Ireland. We make a huge contribution to the economy, and the Northern Ireland economy is a small-business economy. We are bringing forward views that are based on practical experiences, particularly those of business people working in smaller businesses.

99.

We want to have the Employment Bill. There are parts that we would like to see changed, but, as we said in our submission, we welcome the spirit of the Bill. I am sure that everyone here today wants to see the Northern Ireland small business sector flourishing, developing and contributing to the economy. They would want it to continue to contribute to the Exchequer through income tax, VAT and so on — all the areas where we have contributed throughout the difficulties of the past 30 years. We are a positive and progressive organisation, and we want to ensure that matters will work in practice.

100.

Mrs Nelis: I was going to say that you are very welcome, but, after listening to what you have said, I am not too sure whether you are very welcome or not. At the Second Stage of the Bill in the Assembly last week, practically every member of the Committee expressed concern that the Bill did not clarify sufficiently the distinction between small and large businesses and that there needed to be some flexibility. We all shared those concerns.

101.

In saying that, I must remind you that this is a parity Bill from Westminster. It is not terribly enlightening or supportive of women’s rights to work and have children. The Bill concerns business. The Bill is really about the retention of working parents in the market, and the introduction of this legislation will help that. The Bill is not so much concerned with the rights of women to hold down jobs and have their babies or whether they have, as you described, not-so-important jobs or very important jobs.

102.

I cannot believe that in this day and age you said that you were a bit worried about the disruption that a women having a baby might cause to your business and that you would prefer there to be no absences. Does that mean that, as Ms McWilliams said, you do not want to employ women who might potentially have a baby, or do you want them to have the baby on the premises? I thought that we had left that sort of attitude behind. Do you prefer to employ women who will give you a guarantee, perhaps in writing, that they will not have children? That is what is coming across from you. We must put that out of the way.

103.

I want to give some statistics. Approximately —

104.

The Chairperson: Could you be brief, Mrs Nelis? Do you have a question on the Bill?

105.

Mrs Nelis: With respect, Mr Chairperson, you did not interrupt anyone else so do not interrupt me.

106.

The Chairperson: I also told Roger Hutchinson to be brief, and I was about to tell Monica McWilliams the same.

107.

Mrs Nelis: I want to put the issue into context. Thirty per cent of mothers in the North of Ireland fail to return to employment after maternity leave. Seven thousand women do not return because they are not welcome back and are not given guarantees that their job will be there. They will be doing exactly what you said. Another 80% of economically inactive women do not want a job; their reason is that they want to have a family and look after a home. They would like to have a job, but they need the co-operation of employers to be able to do so.

108.

The Bill is giving them some measure of co-operation. It asks you, as employers, to co-operate in allowing women to be economically active and to have, and be able to look after, a family. That is really what the Bill is about. Can you tell me what legislative flexibility we can introduce to the Bill, given that you have administrative concerns? Tell us about your proposals to overcome your concerns, and we will try to introduce a clause to deal with those.

109.

The Bill aims to enhance your business by allowing women to have their rightful place in the market. It is about allowing parents their rightful entitlement to maternity and paternity leave and allowing them to negotiate with you.

110.

If I were a smart business person and wanted to run a successful business, I would be delighted if an employee said that they had children under six years old, for example, or were looking after an older person but that they valued being in my employment and wanted to come to some arrangement with me so that they could do their work efficiently but also meet their responsibilities at home. That is what the Bill is about.

111.

Mr Munster: I employ quite a number of women who have been off work to have babies and who have asked me if they could work part-time. Where possible, I have agreed to that. I did so without any legislation because it made sound business sense. Our argument today is not that it is not good to encourage people back into jobs after they have had a baby. It is about shackling businesses with more Regulations that will discourage them and make it difficult for them to operate. That is our argument. Questions were asked, and I apologise if we did not answer them particularly well. However, you misunderstand me, and the federation’s position, if you think that we are asking to return to the Dark Ages. We are most certainly not.

112.

Mrs Nelis: You are misreading the Bill, if you will forgive me for saying so. You are misreading its contents. The Bill contains safeguards for businesses. It also contains clauses that will enable you to recoup administration costs in advance.

113.

Mr Roberts: It is by no means right to suggest that we are in favour of going backwards. We are here to try to make the situation work. We are not opposing the Employment Bill. We have concerns about red tape and Regulations. We want the situation to work for employees and employers, particularly those self-employed people who have one, two or three members of staff. Many self-employed people earn below the minimum wage.

114.

Many small business people who are not particularly well off struggle to find business. It would be wrong if we did not communicate their concerns, but we want to be positive and make the situation work. We want to work with the Committee, the Department and other business organisations to get a resolution. However, just because we have concerns about red tape and Regulations does not mean that we want to go back to the Dark Ages. Even within the senior membership of the federation, there is a high proportion of women who are successful entrepreneurs — women who have had families and have made a major contribution to the economy. That is what we want to see.

115.

Mrs Nelis: Women who did not disrupt your work?

116.

Mr Roberts: We are working with organisations such as the Equality Commission for Northern Ireland and the Northern Ireland Human Rights Commission to try to take forward the broader situation about rights, both for employers and employees. That is why we are here today. We are not in favour of going backwards: we want to move forwards. We want to ensure that employees are protected and that there is a dynamic economy where small businesses thrive, where there is prosperity and where people have jobs.

117.

We are not against women having children. We suggested that there may be people who would decide to employ a certain person because of the Regulations. Because of the Bill, people may seek to employ a certain person because it would be easier for them to do so. We are not in favour of that. If they were to take that view, it would be completely wrong. We are trying to prevent that.

118.

Mr Mitchell: Much of what I was going to say has been said. The number of young women who are becoming members of the federation and starting their own businesses has encouraged us recently.

119.

The Chairperson: The Bill seems to make arrangements for financial compensation to companies, particularly small ones. The Bill also attempts to cover some of the administrative costs of processing maternity and paternity pay. You seem to have concerns that those provisions are not strong enough. Do you want to elaborate on that? Are they not definite or clear enough?

120.

Mr Munster: We are concerned that even administrating that will be a problem.

121.

Mr Roberts: That is the problem in a nutshell.

122.

The Chairperson: Are you saying that the provisions will not fully compensate companies? Is the bottom line that they will be out of pocket?

123.

Mr Munster: It is about how to measure the cost of the key person in the small business having to take the time to administer the mechanism used to pay the benefit; to reclaim whatever percentage they are allowed; and also to reclaim what they are allowed for administration.

124.

Ms McWilliams: You do not like the Bill in its entirety. Will you be proposing any amendments?

125.

Mr Roberts: We have highlighted three areas of the Bill, and we have made representations to the Department on this broad area. We need to consider specific practical amendments.

126.

Ms McWilliams: So there may be amendments?

127.

Mr Roberts: Yes. We are not completely opposed to the Bill. If there are practical amendments that we can make to address our concerns, we will go down that road.

128.

The Chairperson: We would be interested to see any ideas on detailed amendments that you come up with. The same will apply to other groups giving us evidence. I want to return to Arthur Doherty’s point about definition. The federation seems to be suggesting that it would like the Committee to amend certain provisions to exclude small businesses or to change the way in which they are treated. However, how should the Committee define a small business? Should it be defined as one with fewer than 10 employees, fewer than 25 or fewer than 50?

129.

Mr Mitchell: It would not be one number. There would need to be a graduated approach.

130.

Mr Carrick: I wish to express an interest: my wife is a small employer. Contrary to the impression that the Committee might have given this afternoon, I appreciate the contribution of small businesses to the Northern Ireland economy and the employment that they provide. I hope that they will continue to provide jobs.

131.

Mr Munster: Thank you.

132.

Mr R Hutchinson: I agree with Mr Carrick. Do not be put off by some of the Committee’s questions.

133.

Mrs Nelis: According to your statistics, women own only 7·6% of businesses.

134.

Mr Mitchell: Business ownership by women is increasing nationally, according to the latest survey.

135.

Mr Roberts: I presume that you refer to our ‘Barriers to Growth’ document. We had hoped for a better response rate to our survey.

136.

The Chairperson: On behalf of the Committee, I thank you for your oral evidence and for your written submission. I wish you well.

Thursday 20 June 2002

Dr Birnie (Chairperson)

Mr Carrick (Deputy Chairperson)

Dr Adamson

Mr Dallat

Mr Hilditch

Mr R Hutchinson

Mr B Gourley ) Northern Ireland Committee of the Ms A Hope ) Irish Congress of Trade Unions

Mr L McBrinn )

137.

The Chairperson: I welcome Mr Gourley, Ms Hope and Mr McBrinn from the Northern Ireland Committee of the Irish Congress of Trade Unions and thank them for their written evidence. They will now give a short presentation.

138.

Mr Gourley: I thank the Committee for the opportunity to present evidence on the Employment Bill. We are disappointed that much of the Bill will be passed through Westminster. We deal only with family-friendly policies, which, through no fault of the Committee's, is outside its remit.

139.

Ms Hope: I, too, welcome the opportunity to make a presentation to the Committee. The progress in work-life balance issues, particularly improvements to maternity and parental leave rights, has been one of our key objectives for a long time. We represent some 220,000 workers in Northern Ireland, the majority of whom are parents and more than half of whom are female, so, for a long time, we have had input into those issues on behalf of all our affiliates. Many of our members have been adoptive parents, so we have worked on adoption issues also. In the past, no leave provision was made for adoptive parents, and it was not recognised that they needed time with a child, especially when they adopted older children rather than babies.

140.

We welcome all the advancements in the Employment Bill, but we have concerns about it. First, we question the definition of "employees" and the application of the legislation only to those so termed. We have always argued that all family-friendly rights should apply to workers, not just employees. "Employee" is a narrow definition of someone in the workforce; the broader term "worker" refers to someone with an employment contract or an employment relationship, thus covering both forms of employment.

141.

The narrower definition excludes the selfemployed; temporary workers; casual workers; and agency staff. Given the growth in numbers of such workers in Northern Ireland, especially among women, many people will be left outside the loop. That will leave an unacceptable gap in the extension of rights afforded by the Bill, so the matter must be considered seriously. We urge that the definition of "employee" be amended.

142.

We welcome the provisions to simplify maternity pay and leave, but the effective enforcement of maternity rights legislation, including the operation of sex discrimination law and health and safety rights, must be examined. While the response to 'Work and Parents: Competitiveness and Choice' was delivered by several organisations in GB, the Citizen's Advice Bureau carried out research, particularly on the health and safety of pregnant women. We must consider health and enforcement issues. The Equality Commission, when it appears before the Committee, will point out that one of the highest categories of complaints that it receives is from women who have been discriminated against while pregnant. That issue has not been dealt with at all.

143.

We welcome the extension of maternity leave from 18 to 26 weeks, which applies only to mothers who fulfil the qualifying conditions. We welcome also the proposed simplification of qualifying conditions and notification periods and the proposed reduction of the sickness trigger from six to four weeks. Overall, the proposed new framework will probably be simpler and more manageable for employers and employees; however, the number of women who benefit from longer periods of maternity leave will not increase significantly.

144.

The Bill does not address many issues raised in our response to 'Work and Parents: Competitiveness and Choice'. For example, to extend maternity leave that is paid at a low flat rate, and to extend unpaid additional maternity leave, will benefit only the small percentage of women who can afford to take time off. When the Bill was debated at Committee Stage on June 5, the Minister mentioned the Department's commitment to social inclusion. Unless maternity pay actually replaces earnings, few women will be able to take extended leave. Only those with a sufficient income will be able to do so; therefore TSN requirements will not be addressed.

145.

We regret that the provision to restrict earnings-related statutory maternity pay to the first six weeks of maternity leave will continue to apply, despite many groups' arguments against it. Women will take the longer period of leave to which they are entitled only if the period for which earnings-related statutory maternity pay is extended. We argued for the extension of that period, because many women need extra time to adjust to motherhood, to find adequate childcare and to ensure that their child is settled before they return to work.

146.

If we want to retain women in the workforce, we must find a way to do so; otherwise, the reasons for giving paid leave in the first place will have been negated. In addition, it is costly for employers to recruit and retrain staff that are needed when women do not return to work after a short period of maternity leave. Although we would welcome an increase in the period for which statutory maternity pay is available, maternity pay is quite low. We would argue for earnings replacement maternity pay. That is an area in which limited universalism is fully justified in the interests of the health and welfare of all working women and their babies and to protect their labour market participation.

147.

We are disappointed that provisions, particularly those relating to additional maternity leave, still have a qualifying service condition. The existing service requirement for statutory maternity pay in itself is inherently discriminatory against women who change jobs in the early stages of pregnancy. The requirement of a service qualification means that, if a woman changes jobs when she is one or two months pregnant, she will be unable to access statutory maternity pay. Those qualifying conditions inhibit women's job mobility and, potentially, their career advancement, as changing jobs while pregnant can mean a loss of statutory or contractual maternity benefits.

148.

In our response to the Green Paper, we suggested that the Government consider an integrated maternity and parental leave scheme that would afford the same protection as current maternity leave. It would be equally and individually available to both parents as a possible alternative to extended unpaid maternity leave. It would also encourage more fathers to spend time with their children. Unless it is financially possible, many fathers do not spend as much time with their children as they would like. Working life in Northern Ireland is such that fathers usually earn more than mothers; therefore mothers will usually take the time off.

149.

The chance to radically change the current system was lost in the 'Work and Parents: Competitiveness and Choice' Green Paper. It only tinkered with it, adding bits here and there, but it did not address pay issues, length of leave and so on. Until that happens, many women and men will still be outside the loop.

150.

We welcome the reduction of the sickness trigger from six weeks to four weeks before the expected date of childbirth; however, the provision that an employer can trigger a woman's maternity leave should be abolished or redrafted so that its application is limited clearly to sickness. It should also allow an employer to expressly agree that the sickness trigger would not apply. We will address that issue more thoroughly when proposing amendments.

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