Unite response to BIS consultation: Hiring agency staff during strike action: reforming regulation To: [email protected] by 9 September 2015

This submission is submitted by Unite the Union. Unite is the UK’s largest trade union with 1.4 million members across the private and public sectors. The union’s members work in a range of industries including all the manufacturing and transport sectors, financial services, print, media, construction, local government, education, health and not for profit sectors.

Introduction 1.

Unite considers the proposed secondary legislation to repeal Regulation 7 of the 2003

Conduct

of

Employment

Agencies

etc

Regulations

is

unnecessary,

inflammatory,

disproportionate and discriminatory of trade unions and severely damaging to the rights and fundamental freedoms of unions and working people.

2.

“The Government thinks that removing Regulation 7 from the Conduct Regulations will

give the recruitment sector the opportunity to help employers limit the impact…of strike action” (paragraph 18 of the Consultation Paper). BIS estimates that “around 27% of working days lost [through workers taking industrial action] could potentially be covered by agency workers” (Impact Assessment paragraph 27). This proposal of itself is in clear breach of international law. It should also be seen in the wider context of the Trade Union Bill and other related measures

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proposed, layering on to 'the most restrictive union laws in the Western world'1.

3.

Removing Regulation 7 of itself and in context will cause immense frustration and

untold industrial damage. If agency staff, many of whom will in the future be considered for employment in the workplace, break a strike, perhaps rendering it meaningless, the resultant industrial unrest this will cause and the splits in workforce will be enormous.

4.

There will also be civil and social unrest. The reality is that agency workers lives amongst

the communities where employers are based. They live amongst permanent employees. Many agency workers will be migrant workers and that will add to divisions within society. Strike breaking causes civil unrest within the communities where both agency and permanent workers live. See also paragraph 14 below. Unite will always work towards organising Agency Workers to ensure they do not become the victims of the poor employment practices this legislation proposes. However despite the best efforts of Unite it is inevitable that this legislation will have the potential to lead to social and industrial unrest.

5.

The ILO Freedom of Association Committee has confirmed that “the hiring of workers to

break a strike in a sector which cannot be regarded as an essential sector in the strict sense of the term....constitutes a serious violation of freedom of association”.2 The use of agency workers to replace striking workers will violate trade union members’ right to strike which is also safeguarded by ILO Convention 87 Article 3, the European Social Charter 1961 (Article 6(4)) and Article 11 of the European Convention on Human Rights.

6.

The European Court of Human Rights Grand Jury unanimous decision in Demir3 made

clear that the government has an obligation to promote collective bargaining, not to harm it. Subsequent decisions4 mean that the right to strike is included, in that a trade union must be 1

The promise made by Tony Blair in an article in the Times in 1997 that any changes made to the antiunion laws would still leave the UK’s laws as the most restrictive in the Western World. 2

ILO (2006) Digest of decisions and principles of the Freedom of Association Committee of the Governing Body of the ILO, paragraph 632. http://www.ilo.org/public/english/bureau/leg/download/digest_cfa_en.pdf 3

Demir and Baykara v Turkey [2008] ECHR 1345

4

For example Enerji Yapi-yol Sen v Turkey [2009] ECHR 2251

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able to bargain collectively and its members must be able to strike, otherwise collective bargaining is weak to the point of being useless.

7.

In spite of this, the only reference to fundamental human rights and freedoms in any of

the current consultations relating to this further attack on trade unions appears in the one relating to picketing and protest and is specific to that.

8.

In paragraph 2 above we referred to the wider context of the Trade Union Bill and other

related measures proposed, layering on to the “most restrictive union laws in the Western world”. The impact assessment for the ballot thresholds proposed in the Trade Union Bill says that as a consequence the “best estimate of the reduction in work stoppages [is] 65%. This would be added to the 27% referred to above, even if there is an element of overlap.

9.

Unite also requires this response to be looked at along with the responses to the other

two related consultations, particularly given the shortened response time during the summer. Adding further restrictions and requirements, including the proposed time limits on the efficacy of ballots, the requirement to publish plans of action and give greater notice of industrial action, further restrictions on picketing and protests, changes to the demands on unions in relation to the role and funding of the Certification Officer and high fines for not meeting these and other stringent new requirements, means our conclusion must be that these measures seriously undermine the ability of trade unions to function effectively, at a time when Britain’s anti-union laws are already the subject of significant criticism for being outwith international law.

10.

The changes will also provide a new mother lode for the employers’ lawyers to mine

easily, including taking out injunctions to prevent effective action when the UK system for obtaining an injunction merely requires the employer to show “a serious issue to be tried” when judges are required to “weigh the balance of convenience”. There is no impact assessment of the extent to which this mechanism will be used to prevent industrial action. Both the ILO and the Council of Europe have condemned the ease with which the courts here grant interim injunctions to employers. A modest change in the law should be made to provide that the employer has to show they are more likely to win at trial than the union and should provide some limit on the operation of the “balance of convenience” by denying employers an

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injunction if they don’t supply specific information within a time frame.

11.

The equality impact assessment (of roughly a page in the Impact Assessment document)

is hopelessly rose tinted. Trade unions promote equality5. Weakening effective trade unions promotes inequality6. The IA fails to even acknowledge the prospect that those most vulnerable in society will have depressed wages and conditions for decades to come as a result of the increase in the power imbalance of businesses being able to determine pay and conditions of workers, as a result of weakened trade unions7. It is notable that, since 2009, the most equal countries in the world, (with the exception of Japan where just 18.5% of workers are unionised), have been those where union membership is highest. In Finland 69.2% of workers belong to a union, in Sweden 68.4%, Denmark 66.6% and in Norway 54.4%.

12.

Strong unions are an essential guarantor not just of social justice, but also of economic

efficiency. See the World Bank publication “Unions and Collective Bargaining – Economic Effects in a Global Environment” said to present “a valuable overview of existing research and new evidence

about

the

impact

of

a

variety

of

approaches

to

labor

relations.

It shows that with sound labor policies in place, governments, employers, and organized labor can work together in many ways to foster higher productivity growth and lower unemployment, while securing for workers a greater share in the benefits of growth. It is an important contribution to a field that deserves more attention.”8

13.

More recently, in June 2015, the IMF published a further paper entitled “Causes and

5 The Canadian Supreme Court is not noted for being on the side of working people, but nevertheless in 2007 was forced to conclude: “"Recognizing that workers have the right to bargain collectively as part of their freedom to associate reaffirms, enhances and promotes the values of dignity, personal autonomy, equality and democracy that are inherent in the [Canadian Rights] Charter." http://www.law.utoronto.ca/documents/conferences2/StrikeSymposium09_Fudge-ILJ.pdf 6

IMF research paper which shows the positive role of unions in reducing inequality and reports that the decline of union density explains on average 40 percent of the increase of the top 10 percent income share http://www.imf.org/external/pubs/ft/sdn/2015/sdn1514.pdf 7

see for example http://www.newstatesman.com/uk-politics/2011/09/trade-unions-british http://www.newunionism.net/library/internationalism/World%20Bank%20%20Unions%20and%20Collective%20Bargaining%20-%20Economic%20Effects%20-%202002.pdf 8

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Consequences of Income Inequality: A Global Perspective”9. The research shows that shows that there are economic downsides to inequality. Raising the income share of the poorest 20% of the population increases growth by as much as 0.38 percentage points over five years. By contrast, increasing the income share of the richest 20% by 1% decreases it by 0.08 percentage points.

The reasons are explained.

Given that unions, collective bargaining and, where

necessary, strikes decrease inequality, it is bad economics to hamper unions to the extent they are in the UK already.

14.

The equality impact assessment does report at paragraph 5 (the penultimate paragraph)

that: “Looking at LFS four-quarter averages for 2014, there is some evidence that compared to those in employment who were not temporary agency workers, temporary agency workers were statistically more likely to be: ♦ Men than women ♦ Aged 16-24 or 25-34, and less likely to be older than 34. ♦ Asian or black ethnic minority, and less likely to be white ♦ Muslim, and less likely to be no religion, ♦ And less likely to have a disability.”

But there is no analysis of the equality impact, for example, on those with a disability, who have no option but to take part in industrial action, and are replaced by agency workers without a disability.

15.

The specific issues in paragraphs 9, 10 and 11 above do not appear in the Regulatory

Policy Committee’s assessment to the effect that the IA is otherwise not fit for purpose.10

16.

Regulation 7 is far from redundant. Unite has had need to rely on it on numerous

occasions. One significant example occurred in relation to the Northampton NHS trust in 2013. Pathologists were driven to the point that they took strike action. Emergency cover would have been provided for by the union. Nevertheless the state employer proceeded to look to cover the work by agency workers. It took an application by Unite for judicial review and an injunction

9

https://www.imf.org/external/pubs/ft/sdn/2015/sdn1513.pdf https://www.gov.uk/government/collections/red-rated-impact-assessment-opinions-since-may-2015

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5

to provide for appropriate cover during any action.

17.

It takes the 129 characters in this sentence to express concern about the restrictions in

the consultation paper, which limit explanations to 500 characters. This alone is evidence that this is not a genuine consultation.

RESPONSES TO QUESTIONS Consultation questions Question 1) a) i) How do you think the removal of Regulation 7 would affect employment businesses?

Negatively.

ii) Please explain briefly what you think the impact will be on employment businesses? (max 500 characters)

On 16 July this year Kate Shoesmith, Recruitment & Employment Confederation (REC) head of policy was reported as saying: “We are not convinced that putting agencies and temporary workers into the middle of difficult industrial relations situations is a good idea for agencies, workers or their clients.”11 (307 characters not counting those in the footnote.)

b) i) How do you think the removal of Regulation 7 would affect work-seekers?

Negatively.

ii) Please explain briefly what you think the impact will be on work-seekers? (max 500 characters)

Work-seekers for these purposes are temporary agency workers. To use the expression workseekers implies they are intended to supplant those taking part in legitimate industrial action in defence of their jobs, pay and/or conditions. 11

http://www.recruiter.co.uk/news/2015/07/recruiters-wary-of-using-temps-as-strike-breakers/

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While they may be given little choice, given the penalties imposed on jobseekers who decline to take on certain work, temporary agency workers covering the functions of those on strike are essentially undermining any improvement in their own pay and conditions, as well as that of the workers whose attempts to take legitimate industrial action are being undermined by the use of agency workers. This will not just be bad for agencies, workers and clients, as suggested by Kate Shoesmith, but will have a detrimental effect on equality and society as a whole (see above).

Agency workers would be putting the health and safety of themselves and others at risk.

See also paragraphs 3, 4 and 14 in the introductory remarks. There will be civil and social unrest and a recipe for racists. Unite will always work towards organising Agency Workers to ensure they do not become the victims of the poor employment practices this legislation proposes. However despite the best efforts of Unite it is inevitable that this legislation will have the potential to lead to social and industrial unrest.

c) i) How do you think the removal of Regulation 7 would affect hirers?

Negatively.

ii) Please explain briefly what you think the impact will be on hirers? (max 500 characters)

By bringing in agency workers to break a strike, the “hirers” would be inflaming already troubled industrial relations. Many employers have long standing agreements with unions that could be seriously undermined by such provocative proposals. See also paragraphs, 3, 4 and 14 in the introductory remarks and our comments at 3(b) below.

d) i) How do you think the removal of Regulation 7 would affect employees taking part in industrial action?

Negatively.

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ii) Please explain briefly what you think the impact will be on employees taking part in industrial action? (max 500 characters)

It will undermine collective bargaining and antagonise already troubled industrial relations.

Paragraphs 3 and 4 (to be considered in conjunction with paragraph 14) of the introductory remarks bear repetition here: “Removing Regulation 7 of itself and in context will cause immense frustration and untold industrial damage.

If agency staff, many of whom will in the future be considered for

employment in the workplace, break a strike, perhaps rendering it meaningless, the resultant industrial unrest this will cause and the splits in workforce will be enormous.

There will also be civil and social unrest. The reality is that agency workers lives amongst the communities where employers are based. They live amongst permanent employees. Many agency workers will be migrant workers and that will add to divisions within society. Strike breaking causes civil unrest within the communities where both agency and permanent workers live… Unite will always work towards organising Agency Workers to ensure they do not become the victims of the poor employment practices this legislation proposes. However despite the best efforts of Unite it is inevitable that this legislation will have the potential to lead to social and industrial unrest. ”

e) i) How do you think the removal of Regulation 7 would affect the wider economy and society?

Negatively.

ii) Please explain briefly what you think the impact will be on the wider economy and society? (max 500 characters)

See paragraphs 3, 4 and 14 of the introductory remarks regarding industrial civil and social unrest.

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See paragraphs 12 and 13 of our introductory remarks regarding the negative impact on the economy and equality from further undermining trade unions and effective collective bargaining.

In addition agency workers covering for strikers will: •

Undermine the health and safety of the workers and the public

•

Reduce the quality of goods and services

•

Encourage divisions in society

•

Negatively impact on businesses, not least by exacerbating disputes.

Question 2)

a) The impact assessment for this consultation assumes that between 17% and 27% of working days lost due to industrial action will potentially be covered by temporary agency workers, based on the limit of availability of suitable temporary agency workers, and the fact that some stoppages involve a large number of workers on a particular day. Do you think this assumption, as set out in the impact assessment, is reasonable?

No.

b) Please give your reasons

See, for example, the report of the Regulatory Policy Committee and the Head of Policy at REC who says: initial feedback from REC members showed the sentiment was that this would be used in very few situations but could inflame situations and make a resolution more difficult.

An impact assessment on each aspect of the proposed changes to the law affecting industrial action cannot be looked at in isolation. See our introductory comments, including paragraph 6.

Question 3)

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a) The impact assessment assumes that the current options for recruiting temporary labour to provide cover during industrial action are used infrequently, due to the additional costs and administrative burden of hiring staff directly, or contracting service providers at short-notice. Do you think this assumption is reasonable?

Yes and No.

b) Please give your reasons

Currently it is unlawful for employment businesses to supply such cover. There are many other reasons why there are problems with relying on temporary agency workers to provide such cover.

Ultimately, it is the duty of employers and unions together to try to find a solution to industrial disputes, in the interest of good employment relations and for the benefit of the business, the workforce, the public and wider society. Most reasonable employers understand this and seek to resolve disputes, not to inflame them with the use of temporary agency workers to break strikes and undermine the process of reaching a long-term agreement.

In addition, most reasonable employers, those who work constructively with trade unions, recognise that replacing permanent, experienced employees with temporary workers who have no interest in the business, and who may lack essential skills, is damaging to future growth and success.

Those unreasonable employers risk the consequences to the economy and society, as well as their own business, as expressed in paragraphs 3, 4 (in conjunction with 14), 12 and 13 of the introductory remarks.

See also answer to 1 e) above.

Question 4)

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a) The impact assessment estimates that a quarter of the pool of temporary agency workers would be available for a placement at short-notice to provide cover for workers taking industrial action. Do you think this estimate is reasonable?

No.

b) Please give your reasons

It is a guess. The Regulatory Policy Committee agrees.

This response is submitted by: Howard Beckett Director of Legal, Affiliated Services & Membership, Unite the Union 9 September 2015

For further information and clarifications please contact: [email protected]

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