Employment analysis: With the Trade Union Bill having gone through its first reading in the House of Commons, Martin Warren, partner and practice group head of the human resources group at Eversheds, looks at the effects this new legislation will have on both unions and employers.

Original news

Government introduces strike ballot threshold, LNB News 16/07/2015 103

Taking industrial action in important public services will require the support of at least 40% of those entitled to vote, following the proposed introduction of a new ballot threshold. The government is also introducing a new 50% participation threshold to all trade union ballots for industrial action. A consultation will run until 9 September 2015. The Trade Union Bill can be accessed here: LNB News 16/07/2015 6.

How significant is this piece of legislation?

I think it is extremely significant. It is the first time that the balloting rules, which were put in place in 1984, have been looked at and updated in this way as opposed to the odd technical tweak.

It makes highly significant changes to the balloting rules. But it's not just about balloting--it will also give the certification officer, the body that supervises trade unions, new powers as well.

What are the key features of the Bill?

The new ballot rules are the headline features. Firstly, the requirement now will be that in any strike ballot at least 50% of trade union members must vote. At the moment if you take 100 members in a ballot, if three vote for a strike and two vote against that's a ballot mandate with just a 5% turnout, so the government is saying it must be 50% plus one.

Secondly, in relation to essential public services there would be an additional requirement that 40% must vote in favour. If we go back to that example of 100 people, in essential public services 40 of them must vote yes and obviously less than 40 vote no to secure a mandate. This is going to require trade unions to engage with their members to secure high turnouts to make sure that it doesn't fall foul of these ballot rules.

Those are the two key headlines, but the Bill does a lot more than that. It builds on the Carr review from 2014 and for the first time it effectively requires a trade union to supervise picketing and to appoint a nominated named supervisor who is then responsible for ensuring that pickets comply with the law and that they peacefully persuade and do not intimidate. So the Bill significantly increases the obligation on a trade union where the trade union organises picketing.

Another important point to mention briefly is the Bill will also repeal the current ban on employers using agency workers when facing industrial action. It's a manifesto commitment and it will allow an employer facing industrial action to effectively temporarily replace those on strike with agency staff--arguably there are practicalities around recruiting and training the right people, but the current provision is uncertain in its ambit and is quite restrictive.

How would this affect the balance between unions and employers?

Trade unions are understandably saying that it's an attack on them. However, when you actually look at it, trade unions have been organising ballots for thirty plus year and what this does is to add an extra layer of administration because they need to ensure they get the right turnout.

Further, if a trade union is balloting in any one of the areas of essential public services--for example, the fire, transport or security services--it's got to work out whether those extra rules apply. The finer detail here needs to be defined through the consultation process--however, you could envisage a situation where, for example in transportation, a trade union is

balloting ordinary employees as well as employees caught by the 40% rule and then the trade unions will have to figure out how it deals with potentially two categories of employee.

Undoubtedly it's going to make the trade unions' lives more complicated.

Are there any concerns about any of the provisions of the Bill?

For lawyers who tend to represent employers in this area, you'd say the Bill is a step in the right direction because it requires trade unions to ensure a more significant turnout.

From an employer point of view, if an employer is going to be subjected to industrial action and have their business impacted then quite a number of employers should positively welcome this so the idea of building in a threshold makes sense.

I think there is an analogy here with the rule from trade union recognition. Tony Blair's government passed very significant rules back in 2001 allowing a trade union, where it's not recognised, to go through a ballot process to compel the employer to bargain with it. The ballot rule in that area of law is a 40% rule so the government applying a 40% rule in the sense of public services is taking the rule that the Tony Blair government added for trade union recognition.

Most people would say that statutory recognition works quite well and there is evidence in this area of the law that it gives the winner a mandate that the loser accepts--if the employer wins, the trade unions goes away and where the trade union wins, the employer accepts that win and then bargains with the union.

Another thing that's worth mentioning is the fact that the Bill will effectively require a ballot mandate to be renewed after four months. At the moment it's very unsatisfactory. If you have a ballot in an ongoing industrial dispute, for example the BA dispute, the ballot can last for a very long time--as long as the dispute exists. So this Bill limits a strike ballot or an industrial action ballot effectively to four months and if the dispute lasts for longer than four months the trade union has to go back and reballot. It is perfectly possible to have a dispute that lasts longer than four months, but you need to check in with the members they still feel as strongly and they still want to vote in favour, which I think is good for both sides.

What would this mean for the use of industrial action to achieve better working conditions?

I suspect it will make trade unions more cautious about organising industrial action ballots. When they finally decide that it's appropriate to call for industrial action they'll probably take more time and effort given the extra rules and thresholds. You could argue that's a downside for the trade union but the upside for them is when they do decide to hold a ballot, and where they spend a bit of extra time and effort, they are going to get a much more compelling mandate than they would have otherwise.

So I don't think it's all downside for the trade unions. For those who jump those hurdles the prize is a much more powerful mandate that will leave them well placed to demand further concessions.

How do you imagine this Bill will fare along its legislative journey?

I think the Bill has been quite cleverly drafted. It sets out a bit more detail than was in the Conservative manifesto but doesn't really go beyond it so there is very little chance of it being blocked in the Lords. There will be twists and turns but I don't think the Lords are likely to change it fundamentally so I think it will go through largely as drafted.