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Employment Rights Bill

My Lords, my amendment proposes removing Clause 59 from the Bill. This would maintain the current arrangements whereby members joining the union since the passage of the Trade Union Act 2016 contribute to its political fund only if they give their active consent to do so. These existing arrangements stem from the compromise reached by the Trade Union Political Funds and Political Party Funding Committee in 2016. The compromise was that unions would not need to obtain active consent from existing members to continue paying into the political fund but would be able to collect the political levy from only those new members who had given their consent and made an informed choice to do so. Additionally, all members were to be reminded annually that they could change their decision.

My involvement in the issue was not because of a long-standing historical interest in political funds, I emphasise; simply, I was asked to chair that committee. In the process, I gained insights into the history of trade union political funds and the arguments for and against opt-in and opt-out clauses when individuals need to exercise a choice.

The 2016 compromise prevented the fear of a sudden and potentially significant reduction in the income of trade union political funds, which could have severely damaged the Labour Party’s finances. While the then Opposition welcomed the compromise, many Conservative Members in this House and the House of Commons were disappointed that the requirement for active consent was not extended to existing members.

Consequently, I was taken aback when I learned that the new Government wanted to abandon the compromise and revert to the pre-2016 position. This Bill proposes returning to a position where all new members make automatic contributions to political funds unless they deliberately choose not to, with reminders only once every 10 years.

During the recent debates on this Bill in Committee, several arguments were put forward from the Government Benches to justify the proposed change. I find none of them convincing. The first argument was that this was merely returning to an arrangement that had lasted between 1945 and 2016. This is a weak argument. Many things have changed since 1945, including the generally accepted view of how to treat customers fairly. It is now recognised that, in most circumstances, customers or members should give clear consent, especially in situations involving active and ongoing participation.

We know individuals could be misled by small print and bureaucratic barriers. What was acceptable in the past is now viewed differently. Automatically signing people up to spend their own money without their active consent is no longer seen as acceptable today. Requiring members to act only if they do not wish to contribute is introducing a bias in the decision which can skew the outcome—in the union’s favour, in this

case. Exceptions usually are limited to situations where there is a clear public benefit or where it is proportionately expensive or bureaucratic for people to register their non-consent. I do not think either situation applies here.

It is an exaggeration to say that this was a settled issue between 1945 and 2016. The Thatcher Government closely examined requiring active consent and were dissuaded from moving to a system of active consent only by an agreement with the unions that they would provide more information about the choice available to members.

During Committee, it became clear that the second main argument for this change was a concern raised by trade unions about a decline in contributions since the introduction of the requirement for members to expressly give their consent. But surely finding that contributions are less than desired is not an ethical reason to withdraw a right to consent; it is a temptation that should be resisted, as we have seen in many walks of life. When faced with a decline in revenues, most organisations first consider how to improve their presentation. They try to make a more compelling offer, spend more time educating members about the benefits or point out that, as in this case, the financial commitment is not large.

Instead, the proposal in this Bill is to resort to obscurity, automatically making members contributors to political funds without first having their active consent. To make matters worse, the plan is to ensure that they will not be tempted to escape and will be reminded of their right to reverse their decision only every 10 years. Many of us have unwittingly been on the receiving end of this practice with things such as low-cost insurance for household devices.

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A third argument used is that trade unions are collective entities rather than businesses, and so the issue of mis-selling does not apply to them. This argument does not hold water either. Members of mutual organisations surely rightly expect to be treated with the same high standards as elsewhere. People contributing to charitable activities also expect this. Why should the unions be any different?

In my view, we should move away from the opt-in and opt-out language. First, it is confusing to members, leading to uncertainty about their rights. Secondly, it is language from a pre-digital era, when paper-based decisions required postage stamps followed by burdensome obligations on members, given the small sums involved. As I argued in Committee, we should provide a simple digitally based arrangement, where members are given an unbiased choice at the point of joining a union, requiring them to tick either the “consent” box or the “do not consent” box. Members then either consent to make a political contribution or they do not.

I therefore ask the Minister to accept my amendment, omit this clause and agree to find a solution that moves away from the language of opt-out and opt-in. We should recognise the importance of consent and design membership forms that are fit for the technology and standards of today. I cannot draft this solution myself, but the Government have the support of those who can.

I thought we had put this issue to bed in 2016. Little did I think that one of the first things a Labour Government would do would be to ditch the compromise they so readily signed up to under the previous Government. Are they content to see a change in these arrangements each time there is a change of Government? For me, that makes no sense at all. I beg to move.