For anyone who can remember the late 1970s or studied the period at school, summer 2022 is reminiscent of the Winter of Discontent. Between November 1978 and February 1979, huge numbers of public and private sector workers were involved in widespread strikes in an attempt to obtain cost-of-living pay rises, against a backdrop of around 13% inflation.
The Summer of Discontent started with a series of three one day strikes by RMT members on the railways, followed swiftly by industrial action by criminal law barristers. At the time of writing, strikes are also threatened by teachers, NHS workers, civil servants and BT engineers (among others).
The Government's response has been to outline a number of changes to trade union legislation, in an attempt to reduce the power of the unions and limit the right to strike. The proposals have been announced on a piecemeal basis; this article summarises them and looks at their likely impact on employers with unionised workforces.
Employment businesses are able to supply temporary staff during strike action
Under Regulation 7 of the Conduct of Employment Agencies and Employment Businesses Regulations 2003, employment businesses (i.e. recruitment consultants) were prohibited from supplying temporary agency workers to carry out the duties of employees who were taking part in official industrial action or to cover the duties normally carried out by another worker who had been assigned to cover for the striking worker. A breach of the Regulations was a criminal offence; which could lead to the employment business being prosecuted by the Employment Agency Standards Inspectorate, a department of BEIS, and fined. An employer who commissioned the supply of agency workers in this situation could also be guilty of the 'common law' criminal offence of aiding, abetting, counselling or procuring that offence. In addition, any person who suffered loss as a result of an infringement could sue the offender for compensation. The Government has repealed this restriction across all sectors in England, Scotland and Wales. The Conduct of Employment Agencies and Employment Businesses (Amendment) Regulations 2022 came into force on 21 July and revoked Regulation 7.
The Trade Union (Wales) Act 2017 prevents the use of agency workers to cover industrial action in devolved Welsh authorities (i.e. the public sector) and disapplies several other trade union measures. The Government intends to repeal this Act through primary legislation when Parliamentary time allows. The Welsh Parliament is seeking clarification from the Secretary of State for Business, Energy & Industrial Strategy on various constitutional issues arising from this proposal.
In theory, revoking these provisions will give a business that is affected by strike action the ability to take on temporary agency staff at short notice to cover essential roles. However, businesses will still need to comply with their health and safety obligations and they will be responsible for hiring workers with the necessary qualifications, skills and experience to carry out the roles required, particularly if those roles are safety critical. Although not in the context of industrial action, we all saw the negative publicity for P&O Ferries where agency staff were engaged to crew the ships and the safety issues that were picked up by the authorities.
This proposal is, not surprisingly, unpopular with the unions but employment agencies are also opposed to it since they believe that it will lead to negative publicity for them, there are insufficient trained agency workers available to do the work and they do not wish to put agency workers in a position where they have to cross picket lines.
Employers are already able to engage temporary workers directly to replace striking employees so will this change make any difference? The lifting of the prohibition on agencies supplying staff may assist employers, as they will be able to outsource the provision of temporary labour; however, it is unlikely that adequate numbers of suitably skilled staff will be available at short notice, particularly where the industrial action is widespread, and employers will be wary of hiring agency workers if this could put them in breach of the health and safety legislation. In addition, they may be concerned about doing anything that could increase conflict in the workplace or have a negative impact on industrial relations.
UNISON has recently announced its intention to challenge the introduction of the Regulations by bringing an application for judicial review against the Government in the High Court.
Increase in limits on damages where industrial action is unlawful
Where a court finds that strike action is unlawful, it can award capped damages against the union under Section 22(2) of the Trade Union and Labour Relations (Consolidation) Act 1992. The caps depend on the size of the union and had not been changed since 1982. Until recently, they ranged from £10,000 to £250,000. For the largest unions with 100,000 members or more, the maximum award has quadrupled to £1 million. A statutory instrument – the Liability of Trade Unions in Proceedings in Tort (Increase of Limits on Damages) Order 2022 – came into force on 21 July and applies to any act that takes place on or after that date.
While this sounds like a positive development for employers, it is unlikely to deter unions from calling strikes; they are generally adept at ensuring that any industrial action taken by their members is lawful.
Teachers to be able to bring lawyers to grievance and disciplinary hearings
When he was Education Secretary, Nadhim Zahawi was examining plans to increase the rights of teachers who choose not to join a trade union. He planned to amend the Employment Relations Act 1999 to give teachers the right to be accompanied to grievance and disciplinary hearings by an external lawyer or representative of an organisation other than a union. This could reduce trade union membership since many employees join a union in order to benefit from representation at work.
Schools and colleges are likely to be concerned that this development (if adopted) will make grievance and disciplinary hearings more adversarial. It could also lead to employers wanting to have their lawyers present at hearings, which would increase their costs.
Although this plan is limited to the education sector, employers will be concerned that it could be rolled out more widely.
Minimum numbers of rail staff to work during a strike
Before the recent rail strikes, Transport Secretary Grant Shapps announced that the Government was considering introducing legislation requiring minimum numbers of rail staff to work during a strike in order to reduce the impact on the public and businesses. The legislation would make industrial action illegal if minimum service levels were not met. RMT and Unite the Union said that they would strongly resist the new law.
No further details have been released and it is hard to see how this would work in practice. We await further information.
Government to prevent online strike ballots
In a linked development, it has been reported that the Government has decided not to allow unions to hold electronic strike ballots. An independent review commissioned by the Government and carried out in 2017 recommended that e-balloting should not be introduced until the Government had carried out a test of e-balloting in non-statutory contexts. It appears that this will not happen. Employers are likely to welcome this news: anything that makes voting easier is likely to result in a higher turnout in a ballot.
The current political situation
The Winter of Discontent ended with the defeat of James Callaghan's Labour Government on a no-confidence vote, paving the way for Margaret Thatcher to be elected in the 1979 general election and the passing of anti-union legislation by the new Conservative Government. History appears to be repeating itself. However, with a new Prime Minister set to take over from Boris Johnson by 5 September, it is possible that the Government's legislative priorities will change. We will look out for developments and keep you updated.
If you have any queries on any of the items covered in this note, please get in touch with your usual Womble Bond Dickinson contact.