The Government's recent announcement of The Carr Review, an independent review of industrial disputes law, signals a very interesting time for industrial relations in this country.
Since 2007 there has been a significantly greater degree of industrial unrest than we have seen for a long time in the UK. We have seen strikes in the teaching profession, on the tube, at Royal Mail and Post Office, the NHS, in local authorities, the civil service and even the newspaper business. This is not to mention the number of stand-offs where action was threatened and not taken. Disputes tend to follow the economic cycle of course and it is no coincidence that this shift has occurred following the financial collapse and the imposition of severe cuts in public spending. However, there are other factors at play here, including the dramatic changes in our labour market over the last 10 years. Old certainties of jobs for life and the norm of employees staying with one company for their whole working lives have fallen away. The labour market is a multi-piece jigsaw now with a mish-mash of contractors, agency workers, short term contracts, zero hours arrangements and homeworkers all going to make up a much more flexible picture. The concept of retirement has also changed as has the ability of ordinary employees to support themselves once they have stopped working.
Add into the mix the recent publicity surrounding the 30 year anniversary of the miners' strike and all of this has seen our industrial laws being placed under the spotlight. The current legal structure for regulating industrial disputes dates back to the Thatcher government and its wholesale shake-up of the law in this area. It is now being widely questioned as to whether it still works some 30 years on.
We look at some of these issues that have hit the headlines as well as recent cases and their implications.
Government review into the law of industrial disputes
During the bitter Grangemouth oil refinery industrial dispute, in late 2013, it was alleged that the union, Unite, had sent a group of members to protest at the home of one of the managers. This was described at the time as a 'mob' in the BBC reporting. Unite claimed that this form of 'leverage tactics' was a legitimate form of protest and that bad employers should have 'nowhere to hide'.
The Government has responded by implementing a review of these intimidation tactics used by unions and, more widely, the current legislation dealing with activities taking place during industrial disputes to establish if it is "fit for the 21st century". Bruce Carr QC has been asked to lead the project and 'the Carr Review' will report in autumn this year.
The underlying issues revolve around the economic impact of disputes at a time when the economy is in a state of fragile recovery and also how disputes can impair important facilities and services.
The terms of reference are to provide an assessment of the:
- alleged use of extreme tactics in industrial disputes, including so-called leverage tactics; and
- effectiveness of the existing legal framework to prevent inappropriate or intimidatory actions in trade disputes.
The Government expects the review to produce proposals and recommendations for change. There will no doubt be some political sensitivity surrounding the output of the exercise, particularly with an election in 2015. Bruce Carr has said he will be approaching the issues with an open mind and will be gathering information on tactics used by employers as well as unions.
Industrial action and essential services
The Tube strikes in January 2014 saw repeated calls for the London Underground to be designated by the Government as an essential service. This would be aimed at replicating the position in relation to the police and fire service whereby the tube would have to maintain a minimum service level even during periods of industrial action. There is a suggestion that this will be included in the next conservative manifesto as a policy.
A requirement to provide a minimum service level is often seen as a more palatable way of placing some form of restriction on a union than attempting to place an outright ban on industrial action. Collective agreements can contain an agreement not to take industrial action. However, since most collective agreements are not legally binding on either the employer or the Union, there would be no power to enforce this 'no strike' deal. The prison officers union, the POA, had agreed not to strike in a collective agreement in 2005 but broke this commitment in 2007 over pay.
The tube strike also lead to emotive exchanges involving the Mayor of London, Boris Johnson, and the late RMT leader Bob Crow. At the root of the debate was the issue of turnout in strike ballots, with Johnson calling for a review of the law on balloting so that at least 50% of the relevant workforce had to vote in order for the ballot to be valid. This is a view Johnson has aired a number of times previously with an eye on the RMT and its ability to cause significant distress to London's workers on the tube, the buses and overground network.
Currently, industrial action is supported by a valid ballot as long as the union secure a simple majority of those voting. There is no rule concerning minimum 'turnout' of those who are entitled to vote. This has long been a bone of contention with employers and employer organisations. The CBI has argued for a minimum of 40% of the balloted workforce voting for action for a number of years. This is partly fuelled by a concern that an abstention in these circumstances is often tantamount to a 'no' vote for the action. As a result, low turnout and high numbers of abstentions can mean that a relatively small proportion of pro-strike votes can bring about the action in circumstances where the vast majority of the workforce do not support taking action.
Private sector union membership
Union membership in the private sector has been on a slow and steady decline since the end of the 1990s. However, recent figures released by BIS show that from 2010 to 2013, there has been an increase in membership.
By the end of 2013 there were 2.6 million private sector employees in trade unions – which is in contrast to the reduction of member numbers from 3.4 million in 1995 to 2.5 million in 2010. The more recent movement of public sector employees into the private sector seems to be the main causal factor in this arresting of the decline.
The three private sector industries that saw the largest rise in union membership are the arts and entertainment, financial and insurance, and transport and storage.
RMT v UK
In 2012, the RMT lodged an application in the European Court of Human Rights against the UK Government, alleging that its right to freedom of association under Article 11 of the European Convention on Human Rights and Fundamental Freedoms was being infringed.
The first issue in the RMT claim concerned the 'onerous' obligations placed on the union in relation to balloting for industrial action. The background to this limb of the application was a pay dispute involving the RMT and EDF Energy. EDF was contracted to operate the electrical power network for the tube.
RMT balloted its members for industrial action. The ballot notice set out the number of “engineer/ technician” workers who would have a vote. EDF challenged this because it categorised the workforce differently. EDF managed to secure an injunction preventing the RMT from taking strike action because the notice of ballot had not described the job categories of those entitled to vote properly.
The second aspect related to the ban on secondary or sympathy action in the UK. The RMT was in a separate dispute with Hydrex Equipment Ltd about reductions in the value of terms and conditions. The RMT wanted to seek support from employee members at another employer, Jarvis Plc. There was a close connection between Hydrex and Jarvis, as Jarvis had employees who transferred to Hydrex. The UK law prevented this type of sympathy action.
The ECHR decided that the RMT's challenge to the UK's provisions on strike ballot notice provisions was inadmissible; acknowledging that, despite its contentions in this respect, the RMT had managed to hold strike action whilst successfully complying with the UK law requirements.
In relation to secondary action, the ECHR reached the view that the UK ban did not offend the union's right of freedom of association and that overall the UK law struck a fair balance in this respect.
R (on the application of Boots Management Services Ltd) v CAC and PDAU
The High Court has disagreed with the CAC's decision that a trade union (the PDAU) could proceed with its application for statutory recognition in respect of a group of Boots pharmacists.
The Pharmacists' Defence Association Union (PDAU) had applied to the CAC for recognition by Boots Management Services Ltd (Boots) in respect of a group of pharmacists. Boots said that the application should not succeed because it had an established relationship with a listed trade union, the Boots Pharmacists Association (BPA), for employees in the proposed bargaining unit.
However, Boots did not collectively bargain with the BPA for pay, working hours or holidays and had no intention of doing so in the future. The BPA was only a consultative body.
The CAC decided that the PDAU's application for recognition should proceed despite Boots' existing agreement with the BPA. Boots sought a judicial review of the CAC's decision.
The High Court agreed with Boots and found that the CAC had made a mistake. In other words, the PDAU could not apply for recognition because Boots had already entered into a collective agreement with the BPA for the same employees. It did not matter that the BPA agreement did not cover pay and conditions - it was enough that it covered facilities for union officials and the machinery for negotiation or consultation.
This is an area which appears ripe for change – it is hard to argue that entering into a 'sweetheart' deal with some form of union or staff association on fairly bland terms should be a block to another union who wishes to represent members on pay and conditions. A great deal will now rest on any political desire to make a change to the legislation and could be something which is deferred until the Carr Review reports.
Barnet LBC v Unison & NSL Ltd
This is an EAT decision relating to the calculation of a protective award where an employer fails in its duty to inform and consult in relation to redundancy and TUPE. The EAT decision focuses on the right method of calculating the level of award.
The award for a failure to inform and/or consult in these situations is up to 13 weeks' pay for each employee affected. In this case, the EAT confirmed that the maximum award was only to be used as a 'starting point' where an employer had not engaged in any consultation at all.
However, the case is a timely reminder of the size of awards that are involved for a failure to inform and consult. In this case, the award under consideration was in the ballpark of £850,000.
Equally of interest, Barnet's failing was in relation to the information required on agency workers. This is the most recent element, added in 2011, which requires employers to disclose the number of agency workers working for the employer, the parts of the undertaking in which they are working and the type of work they are carrying out.