Justin Madders
MP for Ellesmere Port and Bromborough · Labour · United Kingdom
“Friend the Member for Dunstable and Leighton Buzzard asked about, will consider the points raised in this debate and whether any of them can be put into future updates to guidance. As was mentioned, good passenger information is central to standards.”
“As the roads Minister, I of course recognise the importance of bus stops and the important effect they have on the streetscape. My hon. Friend the Member for Dunstable and Leighton Buzzard made clear that she is passionate and informed about the importance of bus journeys to everyone.”
“Where responsibility for highways or individual assets sits elsewhere, close and effective working between the relevant authorities is essential. We expect local plans to join up services, infrastructure and passenger information, rather than treating them as separate issues. That will no doubt be music to the ears of my hon.”
“Our guidance encourages authorities to take a strategic approach to stops and interchanges, including keeping an inventory of infrastructure, identifying priorities for investment and setting locally appropriate standards for facilities and maintenance.”
“She is absolutely right that the quality of a bus stop is about more than accessibility, although of course accessibility is vital. Passengers notice whether a stop is easy to find and use, whether it offers shelter or seating where appropriate, whether it is clean, whether the surroundings feel safe and well maintained and, as we have di…”
“That approach reflects a simple principle: local transport authorities know their areas and are best placed to plan improvements across the whole local bus network. That is why the Department’s vision for buses, within an integrated transport system, puts local transport authorities at the centre of delivery.”
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“I should make it clear that that is an entirely new measure that was not in place at the time of Royal Mail’s privatisation. Except in very limited circumstances, that measure will remain in place in perpetuity, including when there is a subsequent change in ownership of Royal Mail. I want to be clear that the agreement will not give the Government any role in the day-to-day running of the business—Royal Mail remains a private entity. Not only have we agreed a golden share, but the EP Group has made a number of other commitments in addition, which I will set out at a high level.”
“Today I can confirm that we have agreed a deed that customers and the workforce alike can welcome, with significant new commitments from the buyer to the Government. This deed is a clear example of the Government’s commitment to working hand-in-hand with business to generate reform and investment in public service. It is also yet another example of this Government fixing the foundations where the previous Government did not. I am proud to announce to the House that we have agreed that the Government will have a golden share in Royal Mail. This golden share will ensure that the Department for Business and Trade now has an ability to prevent Royal Mail from moving its headquarters abroad or moving its tax residency without Government permission.”
“At the same time, Royal Mail has not met its quality of service targets set by the independent regulator, Ofcom. Royal Mail’s performance for the 2023-24 financial year resulted in Ofcom fining it £10.5 million. While the previous Government were happy to accept decline, this Government have worked closely with the buyer to secure significant commitments to deliver the transformation of Royal Mail into a sustainable service, and hard-wired in stronger protections for Royal Mail’s identity. When the discussions with EP Group began, my Department’s objectives were: first, to strengthen the financial sustainability of this iconic and important British institution; and secondly, to protect the customers, workers and brand of Royal Mail.”
“I wish to be clear that this does not mark the conclusion of the takeover, and these undertakings will become effective only if the takeover goes through. Should the takeover complete, I am pleased to announce that the Department for Business and Trade has secured significant commitments to promote a long-term and financially sustainable future for Royal Mail in the United Kingdom. It will be helpful if at the outset I set out where Royal Mail was at the time the takeover bid was announced. Before the bid, Royal Mail’s financial position was challenging. In its financial year 2023-24, Royal Mail recorded a loss of £348 million. That loss was in part due to a long-term decline in letters, and the significant fixed costs of the universal service delivery network.”
“With permission, Madam Deputy Speaker, I will make a statement on the ongoing takeover of Royal Mail Group’s parent company, International Distribution Services plc. Royal Mail is an iconic national institution, and this Government are committed to ensuring that it remains one. Since taking office in July, the Secretary of State for Business and Trade and I have been clear that the Government will robustly scrutinise the proposed takeover of Royal Mail and ensure that there are safeguards for its future. While a takeover bid is still ongoing and subject to the relevant regulatory processes, the purpose of this statement is to update the House on the legally binding undertakings that have now been given to the Department for Business and Trade by the bidder, EP Group.”
“She also asked about tax residency in perpetuity, which is what the golden share does indeed intend to deliver.”
“I think it is recognised that an awful lot of work is needed to bring standards up to the level that we would like, and one of the protections in the agreement will hopefully deliver on that. On jobs guarantees, the hon. Lady will be aware that the general secretary of the Communication Workers Union has spoken positively about the agreement reached. He believes that sufficient assurances have been given on jobs. On employee engagement, she asked whether the employees will own the company. That is not the case, but they will have a say in governance in future as a result of an agreement between the Communication Workers Union and EP Group. That is to be ratified by the Communication Workers Union executive, but that will be a groundbreaking arrangement that we did not have previously.”
“That is why we have had a number of discussions with the company and with Ofcom about how we will get things back on track. That is why the agreement is so important, because the deal will get in the investment needed to try to drive up that performance. I turn to some of the hon. Lady’s specific questions. On guarantees of service provision, the legislative framework is already there for the universal service obligation, and I see the takeover having no impact on that. It has not been part of the discussions—it is an entirely separate issue—but Parliament will have its say on that if needed. Next year, Ofcom will have a consultation on the universal service obligation.”
“I thank the shadow Minister for her comments, and I start by joining her in thanking all those postal workers who throughout the year—not just at this time of year, when it is particular busy, but 12 months a year—come rain or shine, sleet or snow, deliver those much-needed communications from friends, family and loved ones. I was pleased to be able to go to my own depot in Ellesmere Port last Friday. I will go to another one in my constituency, in New Ferry, this Friday. All hon. Members should be encouraged to make those visits, because they really show how much we appreciate the work that our postmen and women do. The hon. Lady is right that the Royal Mail is a service that we all depend on. I agree that performance has not been good enough in recent years.”
“I thank the Chair of the Select Committee for his comments. The golden share is to deal with tax residency and headquarters being domiciled in the UK. Obviously, there will be discussions about the universal service obligation. We know that this is a fast-moving market, and that will be for determination by Ofcom some time next year.”
“I assure the hon. Lady that the universal service obligation is not contingent on this deal—that is an entirely separate matter for Ofcom to be considering—but a number of commitments that we have secured in this agreement will hopefully improve standards, which in any event have clearly not been as we would all want.”
“My hon. Friend will not be surprised to hear that some of my early discussions in this role have been with Ofcom, and indeed with Royal Mail about its performance. There is a shared determination between not just the regulator and the Government but the trade union, the workers and the new owners to drive up that performance, because we can all clearly see that it is not good enough at the moment.”
“I thank the right hon. Member for his question. Is he now the rebellious Back Bencher, I wonder? We all share those concerns about the universal service obligation. This deal is not contingent on the universal service obligation. We have had discussions on how we improve the current state of affairs, because it is clearly not good enough. I hope that his constituents will see an improvement in service as a result of this deal.”
“We hope that the deal will lead to an improvement in service. Specific investment commitments are being made as part of the deal, which we hope will be used to drive up standards. I think that everyone is committed to seeing an improvement on where we are at the moment.”
“The hon. Member must be busy at Christmas time if he has eight offices to visit. He makes an important point about the Royal Mail’s vital role in rural constituencies. We have got commitments to improve standards, and hopefully the deal will deliver on that through the increased investment that has been agreed.”
“First, I extend my sympathies to my hon. Friend’s constituent who was attacked. We all feel abhorrence when public servants are attacked doing their job. My hon. Friend can be assured that services will be protected. This is an opportunity to get investment. We have commitments that were not in place previously post privatisation, so we are in a better place than before.”
“It is not a privatisation—that began under the hon. Lady’s party’s time in office. This is an important step forward, getting commitments that were not previously in place to protect the Royal Mail brand and delivering the investment that we all clearly see is needed.”
“The Secretary of State and I have regularly met the Communication Workers Union. As my hon. Friend rightly points out, there has been considerable industrial unrest in recent years, so it is extremely good news that the Communication Workers Union has talked positively about the groundbreaking deal that it has signed with EP Group. I agree with the union that it is time for a fresh start and a complete reset of employee and industrial relations. We want good industrial relations across the whole economy, so we welcome the constructive way that EP Group has engaged with the trade unions. We hope that that spirit carries forward into the future.”
“The hon. Member may have noticed that I was sitting next to the Under-Secretary of State for Housing, Communities and Local Government, my hon. Friend the Member for Bethnal Green and Stepney (Rushanara Ali), before the statement and we had a brief conversation about that, because we all agree on the importance of Royal Mail delivering our democracy. I assure him and his constituents that it is our intention to see that the universal service obligation is complied with and improved on in future.”
“I thank my hon. Friend for his questions and his service in the Royal Mail. Clearly, arrangements for those currently in the Royal Mail are a matter for the new owners once the deal goes through, and I am sure that that point will be discussed. He is right that the performance has not been good enough, and we are very pleased to have secured a number of commitments in the deal that were not previously in place.”
“I have no doubt that the Communication Workers Union and the Unite Communication Managers Association would not have spoken positively about the deals that they had struck had they not received sufficient guarantees about the workforce. As I said, the general secretary of the Communication Workers Union has been on the air today, speaking very positively about the commitments that he has received about not just job security but governance arrangements, and about workers having a “meaningful stake” in the success of the business moving forward. This is a really positive deal, and if the CWU is speaking positively about it, I think the hon. Member should be reassured.”
“My hon. Friend is absolutely right. One of the biggest assets in the Royal Mail is the workforce itself. That is widely understood not just on the Labour Benches but by the EP Group. As I said, commitments have been made between the trade unions and the EP Group on job security. I hope that goes some way to dealing with her concerns.”
“I can assure the hon. and learned Member that there is nothing in the deal that affects the universal service obligation, and it is our understanding and commitment to continue to ensure that there is a universal service obligation moving forward. There are commitments in the agreement to deliver more investment. On the van network, I know that Royal Mail has purchased a number of vans in recent times, conveniently from the Stellantis plant in my constituency. Hopefully, that will be replicated throughout the country, because it is an ageing fleet. As the company has ambitious targets to meet net zero, I think it wants to improve the make-up of the stock.”
“When I visited my depot on Friday, we discussed the two-tier workforce and the variation in terms and conditions. I think it is generally recognised that it is not a helpful thing; I do not think it has helped Royal Mail with retention. My understanding is that there are agreements to be made between the Communication Workers Union and the EP Group on moving away from that. The detail has yet to be ratified by the union’s executive, but I hope that will mean there is a common basis to try to deal with the issue.”
“I pay tribute to the work my hon. Friend father does, and to his work as an official of the Communication Workers Union. What the union has said about the reset in industrial relations is really important to improving standards; of course, the other part of the agreement—on investment in the company—is much needed. When everyone works together, everyone shares the common goal of the business expanding and improving its performance. I think we have got everyone aligned on that at last, and I hope that we will all see improvements off the back of that.”
“There are a number of safeguards in the deed of understanding that relate to value extraction, so the EP Group will not be able to take profits out of the company unless there is an improvement in performance; there are also safeguards in respect of debt leverage. I hope that gives my hon. Friend the assurances he is looking for.”
“A number of commitments have been made that were not previously in place, and there is no doubt that we are in a much better position than we were post privatisation. As I say, this groundbreaking deal between the unions and the company includes rights in terms of governance, a profit-sharing incentive and guarantees on job security. I am sure that Members will be pleased to hear that we really have made fantastic progress.”
“I agree with my hon. Friend that when the Royal Mail fails to deliver, it is not the fault of the postmen and postwomen; it is about institutional failure in the company that has been allowed to fester for too long. He will be pleased to hear that we have secured a number of commitments to get the investment and security that we need to ensure that the poor performance does not carry on.”
“One of our concerns about including redundancy is that if an employer decided to make a significant number of their workforce redundant, it would be an additional administrative job for them to identify which employees they did not need to include within a redundancy process because they were part of a statutory probationary period, and which would be subject to the wider process. That would lead to unintended consequences and possibly risk of discrimination claims.”
“The Government are committed to ensuring that businesses retain the confidence to do so. We do not wish the new procedures to undermine existing fair dismissal processes for redundancy, which already provide a robust, straightforward and fair process for employees facing redundancy. We will work closely with ACAS, in consultation with businesses and trade unions, to ensure that there is clear, straightforward and easy-to-follow guidance on how to carry out a redundancy process under the new measures. It will be an easily accessible process.”
“Redundancy can affect entire workforces, whereas the other areas are included because of the overlap between the potentially fair reasons for dismissal in the legislation, particularly suitability for work, and the sorts of issues that might come up in a probationary period. A redundancy situation would not ordinarily come up within a probationary period, because it would be about the wider business condition rather than the individual employee’s performance or suitability for the job. I hope that explains why redundancy has not been included. I turn to the shadow Minister’s more general points. We are trying to strike a fair balance between strengthening employee protections against unfair dismissal and maintaining businesses’ ability to hire, assess and dismiss new employees.”
“It is a pleasure to see you in the Chair, Ms Vaz. I refer to my entry in the Register of Members’ Financial Interests and my membership of the GMB and Unite trade unions. The shadow Minister has posed some questions that underlie amendment 156, which seeks to include redundancy as one of the reasons for dismissal to which the lighter-touch standards will apply during the statutory probationary period. As he has rightly identified, the Bill sets out that the reasons for dismissal to which the lighter-touch standards may apply are the statutory grounds of capability, conduct, illegality and some other substantial reason. It is important to note that those four areas relate to the individual employee, which is why redundancy is not included.”
“We have set out clearly our intention to have a light-touch process, and we know that around 9 million employees will benefit from that. The intention behind setting out those steps in regulations is to ensure that we take account of further consultation, which we will undertake not just with employers but with trade unions and civil society, to ensure that we have the right balance of process and fairness in a statutory probationary period. We will be developing that in due course. As is often the case with the ACAS code of practice on disciplinary and grievance procedures, there are already lots of examples of really practical guidance out there, which we intend to replicate. I invite the shadow Minister to withdraw the amendment.”
“The hon. Member may be conflating two slightly different issues. I say to him very clearly that existing laws on redundancy will not be changed as a result of the Bill. We expect employers to follow the same processes, regardless of the length of service of the employee. In that situation, I do not imagine that there would be a particularly lengthy process if it involved only one individual and a small employer. There would not need to be a pool for selection, for example, or selection criteria. We would expect the employer to comply with the law in those circumstances. Amendment 157 questions whether regulations should be able to set steps that an employer must follow for a dismissal to be considered fair when prescribing lighter-touch standards to apply during the statutory probationary period.”
“Someone who is considering moving from one job to another may be more likely to take the leap if they have that window of protection, so it is important for individuals as well.”
“Business in the Community surveyed 4,000 employees, of whom 66% say that their mental health and wellbeing is affected by their personal job insecurity. In written evidence to this Committee, the Union of Shop, Distributive and Allied Workers notes: “Being dismissed on spurious conduct or capability grounds, without a fair investigation”— as can happen at the moment under two years of employment— “can have devastating consequences for an employee. It can destroy the individual’s morale and confidence and…living standards”. This is happening to people already, and it is having an impact. There is also evidence to suggest that there are further advantages for the wider economy. The Resolution Foundation has done some research on the cooling effect of people not moving jobs because they do not have job security.”
“Of course there can be no evidence base for people being unfairly dismissed under two years’ employment, because there is no right protecting them from unfair dismissal before then, except for those who may seek to hang their hat on an automatically unfair dismissal. As we have discussed at length, people sometimes do that because they have a sense of grievance about the way they have been treated, and they may well have a legitimate claim. Hon. Members generally accepted that the labour force survey statistics are not particularly helpful, but there is quite a lot of evidence about the impact of job insecurity more generally and the fact that the two-year qualification period creates uncertainty for individuals.”
“Member for Mid Buckinghamshire indicated, businesses have said that generally six months is about the right period, but in some circumstances they may need a bit longer to ensure that the person is the right fit. That is why we alighted on the proposal for nine months, but we do not want to tie our hands by putting it on the face of the Bill; we want to continue to work with businesses and trade unions to understand whether that is the right figure. Putting a number in the Bill would be premature, because we will have further conversations. As we develop the light-touch process in our deliberations, that may help people to firm up their views about whether nine months is indeed the right amount of time. The hon. Member for Mid Buckinghamshire questioned the evidence base.”
“I am grateful to Opposition Members for tabling their amendments and asking a series of questions. The hon. Member for Chippenham seeks to set the boundaries for the statutory probation period at three and nine months. The hon. Member for Torbay seemed to argue for a lengthier period; I do not know whether he was asking for nine months or beyond, but I take his point. The hon. Member for Mid Buckinghamshire asked us to put six months on the face of the Bill, so there is quite a range of options. We have decided that the best thing to do is work with businesses and consult with them on the detail of the proposal as we move forward. We have expressed a preference for nine months as a result of the engagement that we have undertaken. As the hon.”
“It would also go against the spirit of what we are trying to achieve, which is working in a tripartite manner. The shadow Minister has sometimes criticised me for rushing a little bit, so he will appreciate that we are taking our time with this measure because we want to get it right. I urge him and the Liberal Democrat spokesperson not to press their amendments.”
“I thank the shadow Minister for his questions. Those are exactly the same arguments that we had about the minimum wage, and they did not bear examination in the end. Indeed, the Conservative party eventually decided to support the minimum wage too. The shadow Minister quoted from the evidence of Jane Gratton of the British Chamber of Commerce. She has actually said that she would favour a nine-month probationary period being set out in regulations, which I think is reflective of comments that I have made. It seems a little odd for her evidence to be used in support of an amendment that seeks a six-month period. We are committed to working with businesses and trade unions to finalise the period in regulations. Setting it out in the Bill would tie our hands somewhat.”
“(5B) Subsections (3), (4)(a) and (5) do not apply for the purposes of specifying the amount of the limit in such a case.’” This amendment would enable the Secretary of State to specify the maximum amount of the compensatory award available where an employment tribunal finds that an employee has been unfairly dismissed during the initial period of employment provided for by new section 98ZZA of the Employment Rights Act 1996.”
“I beg to move amendment 55, in schedule 2, page 112, line 36, at end insert— “3A In section 15 of the Enterprise and Regulatory Reform Act 2013 (power by order to increase or decrease limit of compensatory award), after subsection (5) insert— ‘(5A) The power conferred by subsection (1) includes power to provide that, in the case of the dismissal of an employee that meets the conditions in section 98ZZA(2) and (3) of the Employment Rights Act 1996 (dismissal during initial period of employment), the limit imposed for the time being by subsection (1) of section 124 of that Act is a different amount from that otherwise imposed by that subsection.”
“It is important, however, that employers are able to assess new hires and see whether they are suitable for the job without facing the full potential liabilities of unfair dismissal remedies during this period.”
“The power will not enable the Secretary of State to make changes to reinstatement or re-engagement as a remedy available to tribunals for unfair dismissal during statutory probationary periods, nor will it allow changes to be made to the additional compensatory award where an employer does not comply with an order of reinstatement or re-engagement by the tribunal. There may be some concerns that the power could be used to undermine enforcement of the day one right to unfair dismissal, but I assure the Committee that this is not the intention. The Government are making basic protections against unfair dismissal a day one right for employees. They will be able to enforce their rights and take a claim to the tribunal if they have been unfairly dismissed.”
“The power is limited to making changes to the compensatory award for unfair dismissal claims during the statutory probation period only, and only where the new lighter-touch standards apply. The Government recognise the importance of employers being able to assess new hires. We are committed to introducing a statutory probationary period in which there will be lighter-touch standards for an employer to meet in order to dismiss an employee fairly if they are not suitable for the job. The power will not enable the Secretary of State to make changes to the level of compensation for other day one unfair dismissal rights, such as automatically unfair reasons including maternity-related dismissals, or for “ordinary” unfair dismissals such as redundancy.”
“Having listened to those concerns, the Government committed in our “Next Steps to Make Work Pay” document to consulting on what a compensation regime for successful unfair dismissal claims during the statutory probation period should be. Although we want employers to pause and make considered decisions about dismissing employees during probation, the Government do not think that employers should face the full potential liabilities of unfair dismissal remedies when dismissing an employee for reasons related to performance or suitability for the role during the statutory probation period. To have the option of implementing reform once we have consulted, it is necessary to introduce this delegated power.”
“This will include reference to salary and benefits, including pension, until the claimant finds alternative employment. The maximum compensatory award is currently the lower of 52 weeks’ pay or £115,115. The Government have listened to concerns that changes to unfair dismissal law could lead to an increase in unfair dismissal claims, even where there is no merit, and to an increased burden on businesses and tribunals in having to deal with those claims. We have heard that uncertainty of outcome makes it hard for businesses to judge how much to invest in either defending or settling a claim. The introduction of a lighter-touch standard for fair dismissal during the statutory probationary period aims to reduce burdens on businesses and to create certainty, but it will not apply to all dismissals during the statutory probation period.”
“Amendment 55 will expand an existing delegated power to enable the Secretary of State to specify a different maximum compensatory award where an employment tribunal finds that an employee has been unfairly dismissed under the new light-touch standards during the statutory probation period. Amendments 56 and 57 will make consequential changes to the provisions for uprating maximum awards for inflation. In the event of any successful unfair dismissal claim, an employment tribunal will consider compensation as a remedy. Compensation will usually consist of a basic award and a compensatory award. The tribunal will determine the compensatory award by considering what it thinks is just and equitable, having regard to the financial loss suffered by the claimant that has been caused by the employer’s actions.”
“I take on board the comments that the Opposition spokespersons have made, but if we put something in the Bill now, we would be pre-empting the consultation. It is very important to get this right, acknowledging the balance that needs to be struck and the points that have been made. It is worth bearing in mind that this measure will not be implemented until autumn 2026 at the earliest, which is still a considerable time off. The reason we want to take the time between now and then to engage and consult with businesses is to ensure that we get that figure to a spot that gives justice to individuals and certainty to businesses about the potential liability they may face.”