UK Employment Rights – Campaign for Trade Union Freedom

The Government’s announcement that Chancellor Rachel Reeves would announce five new Freeports in the budget was a “communications cock up” Downing Street now says.

On October 25th Starmer (in Samoa for the Commonwealth Heads of Government Summit with the King) and his aides announced the move as part of its effort to drive economic growth.

The Government said it would set out plans to establish more low tax zones plus an ‘investment zone’ in the East Midlands where businesses will benefit from tax breaks such as lower tariffs and customs creating thousands of new jobs and ‘turbo charging’ the economy.

Between 1984 and 2012 existing Freeport’s made little impact on the economy. Unions warned they would suck many companies in to the low tax, union free zones creating low paid precarious jobs and stable jobs would be lost at established businesses.

They were eventually phased out by David Cameron’s government only for Rishi Sunak to re-establish them as chancellor as a way of shoring up trade following the Brexit disaster.

From 2021, eight new Freeports opened in England with two each in Scotland and Wales with little success and minimal interest from business and industry.

Starmer’s announcement said Freeports “would have this government’s stamp on them” despite their failure. He said existing Freeports were “working well” but Labour would make them work better.

The announcement received a frosty reception from business and unions. Unions dusted off their briefings on Freeport’s and with the TUCs comprehensive analysis published in 2020 (region by region) handily still on their website copies soon found their way on to the phones of supportive trade union MPs.

A government official blamed the time difference: “the whole thing was snarled up by the fact that Starmer and his aides (who’d trailed the news) were 13 hours ahead in Samoa” and said it “comms cock up,”

Government officials now say Rachel Reeves will merely be giving the go-ahead to new customs posts at five of the existing Freeports. They say they are still baffled as to how Downing Street managed to make the announcement of customs posts into five entirely new Freeports – with the ringing endorsement of the PM.

It may be somebody pointed out that OBR said in 2021 “that tax breaks in England’s Freeports would cost the government £50m a year and that their impact on GDP was likely to be so small it would be “difficult to discern even in retrospect” – as well as union anger on the question of workers rights and union recognition despite the PMs spokesperson saying (almost as an after thought) that “where necessary the government will make improvements to the Freeport programme” and that the Employment Rights Bill would help safeguard workers’ rights.

Despite recent changes this latest “mis-communication” only creates an air of distrust and reinforces the view that Downing Street’s communications and media operation is a shambolic, and the gung-ho approach by officials and Labour staffers (using Johnsonian ‘boosterism’ language) trying to smuggle policies through thinking we won’t notice does not work.

Labour’s long-awaited Employment Rights Bill does not do nearly enough to remove the restraints on trade unions or to give them the powers they need to make a significant difference to the lives of the millions of workers, write Professor Keith Ewing and Lord John Hendy KC.

There is no doubt that the government should be praised for the significant improvement to employment rights set out in the Employment Rights Bill, published on October 10th.

However, it must also be said that these proposals, set out in 119 sections over 105 pages and a further 43 pages of Schedules, come nowhere near the transformational proposals which Labour adopted in 2021 and 2022: A New Deal for Working People.

The bitter truth is that what working people (half the total population of Britain — with most of the rest dependent on them) need is not more individual rights, welcome as they may be, but greater power.

Power to have a real say over the pay, terms and conditions on which they work. That means freeing the trade unions from the shackles imposed in six Acts of Parliament by Thatcher’s crew in the 1980s and ’90s.

No-one else will represent workers. And to do that job unions need the power, when necessary, to organise industrial action and compel employers to bargain with them. What is also needed is a framework of laws which support collective bargaining and decent terms and conditions.

The Institute of Employment Rights has been arguing for a radical transformation of the law at work for over thirty years. Its publications were the inspiration for A New Deal.

Let’s take a look at the new Bill.

On trade union rights, there is no repeal of the anti-union legislation of the 1980s and ’90s. A New Deal committed the Labour Party to bringing our law on industrial action into line with the international laws (of the International Labour Organisation and the European Social Charter) which Britain has voluntarily ratified and agreed to be bound by.

Since at least 1989 every review by the international institutions of our laws on industrial action have found that they are non-compliant with the nation’s obligations. But the Bill does nothing to redress this situation and the breaches of international law will continue so long as the legal restraints on trade union action continue. In particular, the ban on sympathy action, criticised by the ILO since 1989 and, most recently, last year in its report on the P&O Ferries scandal, is untouched by the Bill.

True, the Bill does do away with the ballot thresholds of the Trade Union Act 2016 (so a simple majority vote in favour is restored) and the Strikes (Minimum Service Levels) Act is totally repealed. But the New Deal’s commitment (repeated just before the election in Labour’s Plan to Make Work Pay) to secure workplace balloting has been abandoned. Although notice of industrial action is reduced to seven days, its complex requirements identifying the number of workers, their workplaces and their categories remain, though the New Deal promised to “examine how the requirement to give notice of industrial action should be simplified.”

The Bill also retains the equally complex requirements to give notice of having an industrial action ballot (the international bodies have heavily criticised this provision and the complexity of the legislation generally).

The Trade Union Act 2016 which A New Deal (and Labour’s Plan) said would be repealed is not repealed in full, though (credit where it’s due) many of its provisions are removed (detailed prescription of the contents of the voting paper, picket supervisors, various certification officer powers etc). There is a useful (but qualified to an extent not yet revealed) extension of protections against detriments or dismissal imposed for participating in lawful industrial action.

The central commitment of A New Deal, the rollout of sector-wide collective bargaining in all areas of the economy, has been put on ice except for school support staff in England and adult social care, though paradoxically the Bill is careful to make clear that the outcomes of these processes will not be collective agreements as they are normally understood.

Nevertheless, the procedures for these two sectors are straightforward and it is hard to see why they should not be deployed in respect of other sectors, notably school teachers, agriculture workers (with their particular history of exploitation), gig workers, hospitality and catering, parcel delivery and so on. Indeed, the government could begin by restoring national collective bargaining to its own Civil Service.

Although it is left to the statutory recognition procedure to carry the burden to grow collective bargaining, the procedure is to be only lightly amended and fails to take account of the serious problems exposed by the recent Amazon case. It will be recalled that despite being frustrated by the alleged anti-union activities of the company, GMB managed to secure 49.5 per cent support of workers who voted.

As GMB made clear after the event, the recognition procedure needs radical revision if it is to help trade unions to grow and expand the coverage of collective bargaining. Although it is true that provision is made for trade union access to workplaces for organising purposes, this is a mouse of a measure which adds very little to the existing arrangements.

It is a gross caricature to suggest that the Bill’s provisions for trade union access amount to a “right.” The Bill provides that a trade union will be able to ask an employer to enter into an access agreement (which they can do already). If the employer refuses, the union can complain to the Central Arbitration Committee (CAC) which can effectively impose an access arrangement.

However, if the employer refuses to observe an access agreement or fails to comply with an arrangement imposed by the CAC, there is no way by which the employer can be compelled to comply. If it is so minded the union can make another reference to the CAC to have a civil (financial) penalty imposed on the employer but this is payable to the government not the union, which walks away empty handed. It is also clear that the whole process will be open to procedural delays by the employer.

Much of the Bill is thus about individual employment rights, including welcome proposals for day one rights (to be subject, in an as yet undefined way, to a probation period), impenetrable provisions on zero-hours contracts (which will surely need to be simplified), and fire and rehire (which is not totally prohibited).

It will be unfair to dismiss an employee for refusing to accept a contractual variation, but only if the employer is unable to persuade a tribunal that the reason for the dismissal was to “significantly mitigate” the effect of any financial difficulties affecting or likely in the immediate future to affect the business.

Provided the employer consults with the employees affected and with a recognised union, it will be home and dry if these conditions are met. As a result, the workers will be left without a remedy for standing on the terms of their contract. This falls well short of expectations, and will no doubt be the focus of intense parliamentary scrutiny.

One of the questions no doubt likely to be asked is how these provisions would have constrained a company like P&O Ferries, and what lessons have been learned from the ILO Committee of Freedom of Association report in that case? The latter emphasised the need for greater respect for collective agreements. But there is no obligation in the Bill on a company to comply with collective agreements before fire and rehire.

More generally, there is no power to restrain a company from dismissal without consulting the employees or the union, and the remedy remains one of limited compensation only. It will continue to be possible for an employer to dismiss a unionised workforce, pay the statutorily limited maximum compensation for unfair dismissal (as in the P&O case), and recruit workers at greatly reduced wages, at a level well below those prescribed by a collective agreement.

We acknowledge reports that the new government will require ferry operators to pay the statutory minimum wage. This is no doubt a step forward when compared to subminimum-wage pay for agency supplied crew. But it is also a green light and a licence for an employer seeking to deunionise and a snub to the ILO, which was rightly demanding more.

The ILO report stressed that remedies available to employers for breaches of the law need to be “sufficiently dissuasive.” This could have been achieved by giving power to grant an injunction to restrain wilful law breaking (as proposed in the private member’s Bill on ending fire and rehire), plus the New Deal proposal to remove statutory limitations on compensation. The Bill provides for neither.

So as some have said, the Bill is a bit like a Swiss cheese. There are welcome new employment rights and improvements of existing rights. But it does not do nearly enough to remove the restraints on trade unions or to give them the powers they need to make a significant difference to the lives of the millions of workers who are without a voice at work.

Although the Bill gives the Secretary of State and his enforcement officers enforcement powers in relation to a limited range of specified statutory rights, our labour law continues to be bedevilled by weak and inadequate remedies. While trade unions can be restrained by injunction when they break the law, there are no corresponding remedies to employers when they do the same.

It will remain impossible to restrain employers when, for example, they break the law on redundancy or fire-and-rehire consultation or refuse to reinstate an unfairly dismissed worker. Employers will remain free to choose whether to obey the law, and to buy themselves out of trouble if they decide not to do so. The failure to address this fundamental imbalance of power speaks volumes about the content of the Bill.

This article is published in the Morning Star October 11th.

Category: UK Employment Rights

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