Industrial Action - Guest Article by John Morgan & Leonie Mcquaide
According to the Office for National Statistics (“ONS”), 2.472 million working days were lost between June and December 2022 in the UK due to industrial action; of these, over three-quarters (79%) came from workers in transport, storage, information and communication.
- The ONS confirmed that after accounting for inflation, the real value of regular wages fell by 2.5% in the year from October to December 2022. Cost-of-living issues have made the last 12 months a challenging and turbulent period for UK industrial relations. Pay negotiations have been conducted against a backdrop of continued high inflation and widespread industrial action.
As a result, this has added pressure to previously harmonious employer and trade union relationships. Some employers are encountering union organising or union-led disputes for the first time and will be faced with the unfamiliar process of union(s) balloting for industrial action. Our firm has market-leading experience in advising clients facing potential industrial action and assisting them to manage their union relationships and workforce engagement.
As a result of a series of Acts of Parliament, the law relating to industrial action is very complicated. Additionally, there are many aspects of the law which are unclear, either because of conflicting court decisions or because of the absence of judicial interpretation.
Where an employer is dealing with an industrial dispute, speed is of the essence. Firstly, it has an immediate impact on the normal conduct of business. Secondly, any legal action is likely to take the form of challenging the ballot and notification process and possibly seeking injunctions, and the courts will not grant injunctions unless they are sought without delay.
In broad terms, industrial action must be taken ‘in contemplation or furtherance of a trade dispute’ and a number of specific statutory requirements must be complied with. In particular, these include conducting a ballot and notifying the employer in accordance with detailed rules and a prohibition on secondary action and unlawful picketing.
Basic Legal Principles
Industrial action in breach of contract is unlawful and organising trade unions are at risk of claims whilst any employees taking part are breaching their contracts of employment and risk disciplinary action, including possible dismissal. However, over many years legislation has been introduced to provide trade unions and employees with a defence, but this defence is only available if:
- the industrial action is taken ‘in contemplation or furtherance of a trade dispute’ which is construed broadly; and
- a number of specific statutory requirements are complied with.
In particular, these include conducting a ballot and notifying the employer in accordance with detailed rules and a prohibition on secondary action and unlawful picketing. If industrial action is not covered by this statutory defence then it can be stopped by a court injunction obtained by the employer, by a union member called upon to strike, or by a third party affected by the impact of the industrial action on the supply of goods or services. Unlawful industrial action exposes a trade union to an action for damages. In July 2022 the maximum damages that courts can award increased from £250,000 to £1 million for large trade unions.
Where an injunction is not a possibility there are other legal options which some employers will generally consider, including potentially reducing the pay of strikers and mitigation steps such as hiring agency workers to backfill their duties. These have to be carefully considered as they risk a potential escalation of the dispute. The ban on using agency workers is being challenged in the courts by 11 trade unions (coordinated by the TUC). Before contemplating any action against striking employees, specific advice should be sought as special rules and protections apply.
If the industrial action is lawful and the statutory defence applies then:
- a strike or other industrial action resulting in a total non-performance of work gives the employer a right to dock pay (partial non-performance, such as an overtime ban, is less straightforward and advice should be sought)
- providing the action is endorsed or organised by the trade union, the employee will be participating in ‘protected’ industrial action. A dismissal for taking part is automatically unfair for at least twelve weeks (or, in some circumstances, longer) from the start of industrial action. In addition, any ‘locked-out’ days must be disregarded from this period
Finally, timelines for both union and employer during industrial action can be very tight and we often see parties trip up by failing to focus on deadlines for particular steps to happen. It is important for an employer to carefully consider ballot papers and other formalities to ensure compliance with the statutory requirements and consider its response.
You may find it interesting to follow us on LinkedIn where we post our latest thought leadership in this space. You can find us here – John and Leonie.
John Morgan is a Principal Associate and Leonie McQuaide is a Senior Associate in Eversheds Sutherland (International) LLP’s market leading Labour & Employment team
Eversheds Sutherland resources
Please see below a number of resources if you’d like to consider this topic further and if you require assistance please do not hesitate to get in touch with a member of the Eversheds Sutherland team.
UK labor law quarterly update – April 2023 – Eversheds Sutherland (eversheds-sutherland.com)
