by Phil Chamberlain | 22 December 2009

One morning in February, two investigators from the Information Commissioner’s Office knocked on the door of The Consulting Association based discreetly off an alley in Droitwich, West Midlands.

A 66-year-old man called Ian Kerr opened it. The investigators announced they had a search warrant and were coming in.

A thirty year covert operation to build a database blacklisting union activists in the construction industry had just come to an end.

It was also a vindication of one of the ICO’s most ambitious investigations. The data watchdog took unprecedented legal steps during its eight-month probe. It eventually named more than 40 of the country’s biggest construction companies as having potentially broken data laws. The ramifications led to questions in Parliament and a promise by the Government to outlaw blacklisting.

Throughout the Cold War the most prominent organisation involved in the blacklisting of so-called subversives was the Economic League. It was paid by companies, and worked closely on occasion with Special Branch, to compile databases of individuals. It was wound up in the early 1990s after pressure from the media and Parliament exposed its personnel and flawed operations.

Many of its operatives went to ground and the files went with them. Kerr was one of them. Michael Noar, former director general of the Economic League, told The Guardian newspaper that Kerr had worked for the organisation spying on trade unions.

“He was a key guy. He was one of our most effective research people. His information was genuine and reliable,” Noar said.

For years rumours circulated in unions that the construction industry in particular still used blacklists. How they were stored was a mystery.

Last summer the Guardian ran an article looking at the issue and talked to some construction workers who said they had been blacklisted.

One was Steve Acheson, a 55-year-old electrician from Manchester who had barely worked in a decade. He had won an employment tribunal for wrongful dismissal which, unusually, had accepted evidence that Acheson had been blacklisted.

Part of the evidence came from Alan Wainwright who had worked in management for a number of construction companies.

He came across Ian Kerr in 1997 and was told that Kerr was a private investigator employed to carry out checks on staff to identify undesirable employees. Wainwright met Kerr twice and Kerr told him many construction companies supplied him with information.

Wainwright worked for Crown House, Drake and Scull and Haden Young and said he found the same system operating with Kerr at all three. Laing O’Rourke, which now owns Crown House, Emcor, which owns Drake and Scull, and Balfour Beatty, owner of Haden Young say they do not condone or use blacklists.

After raising concerns about fraud, but disillusioned with the company’s response, Wainwright left Haden Young in 2006. He launched and lost an employment tribunal and became convinced that he too had been blacklisted. No-one, though, seemed interested in his story.

However, the Guardian article was read by an employee at the Information Commissioner’s Office who brought it into the office.

It landed on the desk of investigator David Clancy. On the door to the office he shares with his three fellow investigators, all with police, military or Customs and Excise background, there is a sign saying ‘Abandon hope all ye who enter here’.

Clancy’s first job was to establish if there was a case worth looking into. So he went to talk to Steve Acheson.

“The day he turned up I had just received a letter turning me down for work,” said Acheson. “I told him he couldn’t have come at a better time.

“To be honest I didn’t think he would find much. I told him this but he said ‘Once I get my teeth into something I don’t let go.’”

After getting copies of Acheson’s evidence from his tribunal hearings, Clancy tracked down Alan Wainwright who had a huge amount of information to share. It was clear that there was a prima facia case that required investigating.

From the evidence gathered, the ICO investigators believed that Haden Young had information they required. Powers contained in schedule 9 of the Data Protection Act 1998 meant that the ICO could give seven days notice that they would turn up to look for it. Alternatively they could make an application to the Crown Court for a warrant in order to effect an immediate search if they believed that giving a warning would mean evidence being spirited away.

This power hadn’t been used before in a case of this kind before however a judge granted the search warrant and in September Haden Young was raided. Information was found that ultimately identified The Consulting Association. Now they needed to more about this organisation.

Clancy said: “We identified an organisation that held a key piece of information for us. We have powers under Section 58 of the Act to ask an organisation for information for the furtherance of the Commissioners’ duties.

“We served the section 58 notice. They declined and suggested we get court order.”

The ICO then considered the unusual step of serving a notice under schedule 9, a demand for access with 7 days notice. This hadn’t been done against third parties before.

“There was great deal of legal argument about whether we were acting beyond our powers,” recalled Clancy. “But we were aware they held evidence and schedule 9 doesn’t say our powers of entry are only against perpetrators.”

As it was the organisation capitulated and gave them the name and address of Kerr and The Consulting Association.

It was back to court for another search warrant and the Droitwich raid was on.

Construction firms paid a £3,000 annual fee to The Consulting Association and a further £2.20 for a single name search. More than 40 of the biggest names in the industry had, at one time or another, subscribed.

Yet for all the money flowing in the investigators were confronted by a shabby two-room office. The furniture dated from the 1970s and 1980s, with an electric typewriter on one of the desks and a sophisticated photocopying machine.

Almost immediately one of the investigators found a ring binder in a rather tatty plastic cover. Inside it were names, addresses and national insurance numbers.

Then they found a card index. It very much resembled the way a police local intelligence filing system might work. It was organised alphabetically and each card related to a name in the folder. The cards contained newspaper clippings, employment history and personal comments. There were files on 3,213 construction workers.

Clancy describes seizing the database as being “like Christmas”.

“This had been going on for years,” he said. “Steve Acheson and others had never been able to get to bottom of it but suddenly we had got an answer. It was a nice feeling.”

Kerr subsequently pleaded guilty before magistrates in Macclesfield to breaking data protection laws and is due before a crown court for sentencing. He faces an unlimited fine or imprisonment. Magistrates also ordered a full disclosure on the organisation and membership of The Consulting Association. The ICO is considering issuing information notices to some 20 companies warning them to handle data correctly. More than 120 people have recovered their blacklist files via the ICO and unions are planning group legal actions against those responsible.

There is a feeling of satisfaction at the ICO about how this particular investigation has panned out. It’s easy to forget that at a several points it could have ground to a halt.

It may not even have started if the ICO employee hadn’t seen the newspaper article. The hearing before the judge was setting a precedent and could have failed. When the sudden search of the construction company was made, Kerr was still untouched. A simple phone call would have alerted him to the ICO’s interest. If one was made he didn’t stop. Indeed material continued to be added to his database subsequently. Even on the day his premises were raided the investigators only got in because the owner of adjoining property let them in through a communal door.

“The stars must have been all aligned,” smiles Clancy.

Future investigations by the ICO might not be carried out in this way if proposals under the Coroners and Justice Bill go ahead.

For instance it would enable them to do spot checks on government departments to make sure their data handling processes are correct. The ICO argues that that right should also be extended to charities and major data holders in the private sector.

Information notices could also be served on third parties during investigation. This would oblige them to provide certain information or face a contempt of court charge.

Clancy says such powers would have helped their investigation.

He admits that these are “quite serious powers” but says that the effect that Kerr’s blacklist had on more than 3,000 people over the last few decades shows the equally powerful impact data can have in the wrong hands.