FAIRNESS
AT WORK
CHAPTER FOUR
Collective
Rights
4.1 Individual
rights provide the essential underpinning of effective working relationships.
Individuals seek and obtain jobs, and agree employment contracts
with their employer. Individual employees have the right to expect
fair treatment at work, and decent employment standards. Most employers
recognise this. Individual employees also have the responsibility
to work diligently and to the best of their ability to fulfil their
part of the employment contract. Most employees recognise this.
Employers and employees value individual success, individual achievement
and individual ambition. Good employers have in place a range of
policies and practices for their employees designed to ensure that
individuals are able to make the maximum contribution they can to
the success of the enterprise.
4.2 But
individual contracts of employment are not always agreements between
equal partners. Good employers and employees recognise that there
is a basic justification in terms of fairness at work for fair
representation of all employees. Collective representation of
individuals at work can be the best method of ensuring that employees
are treated fairly, and it is often the preferred option of both
employers and employees.
4.3 Collective
representation can help achieve important business objectives,
including good communication. It can facilitate negotiation on
terms and conditions without preventing the recognition of good
individual performance. Representatives who are respected by other
employees can help employers to explain the company’s circumstances
and the need for change. Collective representation can give employees
a more effective voice in discussion with employers by drawing
on a wide range of expertise and experience in the company.
4.4 Improving
information and consultation is a primary objective of collective
arrangements. These are important in all companies but there is
particular need in large multinational companies, where management
decisions may be taken far away from the employees affected. The
Government therefore welcomes the extension to the UK of the European
Works Council Directive. This sets out sensible minimum standards
for informing and consulting employees at European level, in companies
or groups with over 1,000 employees and 150 in each of at least
two member states. The Directive was extended to the UK in December
1997 and the Government will give it effect in national law by
December 1999. The Government will consult widely on the details
of this national legislation, and draw on the experience of the
many UK-based international companies which have already successfully
introduced the provisions of the Directive.
4.5 The
Government is working to achieve agreement on proposals for the
European Company Statute. This will also cover employee involvement.
But it is important that such mechanisms reflect the requirements
of individual organisations. That is why the Government is not
persuaded of the need for a directive on information and consultation
in companies operating only at national level. It is difficult
to reconcile with subsidiarity and would cut across existing practices
in member states to no benefit.
Collective
Arrangements involving Trade Unions
4.6 Employers and employees now have available
a wide range of representational mechanisms. Many employers and
employees choose representational methods not involving trade unions,
which achieve good employment relations. The role of trade unions
in centralised collective bargaining on pay and conditions has declined,
reflecting decentralised decision-taking in many organisations.
4.7 But
many equally successful British companies and organisations operate
with employers and employees selecting trade unions to act as
their main means of representation. Of the 50 largest UK companies,
44 recognise trade unions. Trade unions can make the task of forging
effective partnerships easier for employers and employees. In
recent years they have changed to reflect change in business.
Many trade unions now focus much more strongly on working with
management to develop a flexible, skilled and motivated workforce.
Trade unions can be a force for fair treatment, and a means of
driving towards innovation and partnerships.
4.8 The
Government believes every employee should be free to decide to
join a trade union. But equally every employee should be free
not to join. Trade unions should be voluntary organisations. The
abolition of the closed shop was one of the many employment law
reforms of the 1980s that were justified and will remain.(1)
There will be no return to the closed shop.
4.9 But
some of the reforms were damaging. For example, the requirement
that employees re-authorise deductions from their pay for trade
union subscriptions every three years put a burden on business
and is not popular with employers. The requirement will therefore
be removed shortly by an order under the Deregulation and Contracting
Out Act 1994. Individuals will retain the right to opt out of
deductions at any time.
4.10 The
Government accepts the importance of voluntary choices, and believes
that mutually-agreed arrangements for representation, whether
involving trade unions or not, are the best ways for employers
and employees to move forward. Where agreements are reached voluntarily,
they are most likely to be successful and suited to the needs
of the enterprise.
4.11 However,
there will be occasions where employees want the benefit of representation
at work, but are unable to secure agreement to it from their employer.
The Government believes strongly that these will form a very small
minority of cases, and that even then the prospects of voluntary
agreement must be exhaustively examined. But as part of setting
in place minimum standards, the Government will bring forward
legislation to provide for representation and recognition where
a majority of the relevant workforce wants it. The prime purpose
of this is to offer greater protection and security at work for
the vulnerable. The extent of trade union growth and organisation
is dependent on trade unions being able to convince employers
and employees of their value - how much help they can bring to
the success of an enterprise for employers, and how much active
support they can offer employees. Where trade unions are able
to demonstrate value to employers they are more likely to be recognised,
and where they are able to demonstrate value to employees they
are more likely to win members.
4.12 If
employees believe that their interests are best served through
a trade union voice, the Government believes that the business
will gain by accommodating this wish. Businesses and other organisations
are unlikely to establish a successful partnership for change
and competitiveness while overriding the wishes of a substantial
group of employees.
4.13 But
it is vital that a clear framework and process are established
governing decisions on trade union recognition. This must encourage
dispute resolution. Neither the business nor employees will gain
from protracted, possibly hostile, disagreement which can only
damage future relationships whether or not a trade union is eventually
recognised.
4.14 The
Government invited the CBI and TUC to discuss these issues and
to try to narrow their differences. Following discussions, those
organisations produced a statement setting out the points on which
they agreed, in whole or in part, and recording their remaining
differences. The Government is grateful for their efforts.
4.15 The
Government is proposing a new system of recognition. Its starting-point
is voluntary agreement. Only where this proves impossible should
another means be invoked. Setting out the procedure will help
ensure that employers, employees and trade unions all understand
clearly what will happen if they cannot agree. This should in
practice lessen the likelihood of further stages of the procedure
being necessary.
4.16 The
Government believes that, where a clear majority of employees
wishes to be represented by a trade union, the new procedure will
enable that union to be recognised by their employer without the
disputes which have resulted from recognition claims under the
current law. A statutory procedure offers a means of settling
disputes without industrial action. The reason it is important
to have clear support at a workplace is twofold. First, without
real and substantial support amongst employees, collective bargaining
simply will not work. Second, since collective bargaining has
an impact on all employees, not just those claiming union representation,
it is right that it should only be granted in circumstances where
substantial support is demonstrated.
4.17 In
drawing up its proposals, the Government has been determined to
introduce a procedure which will work, which will improve fairness
and which will complement and enhance competitiveness, prosperity
and growth. To deter insubstantial claims, the new procedure will
rest on trade unions being able to demonstrate initially that
they have baseline support among employees before a recognition
claim can proceed. The group of employees to whom trade union
recognition will apply if they choose it - the bargaining unit
- will be clearly defined to avoid disagreements. To demonstrate
beyond dispute that a vote for recognition enjoys genuine and
widespread support among employees, recognition will be awarded
only where the vote in favour exceeds a minimum specified level.
Many small companies recognise trade unions already. Many do not.
In many small firms, employment relations are managed not just
on an individual level, but on a personal level. In these circumstances
statutory requirements on trade union recognition would be inappropriate.
So the provisions will not apply to companies below a set threshold.
Just as employees have the right to join or not to join a trade
union, employers will have available a parallel procedure to end
recognition arrangements if employee support for them reduces
significantly. And to deter unwarranted attempts to obtain recognition
or derecognition, there will be a minimum time period to allow
employment arrangements to demonstrate their validity.
4.18 So
the essential features of the Government’s proposal are:
- there will
be a legal procedure, with time limits attached to various stages;
- the procedure
will encourage the parties to reach voluntary agreements wherever
possible. If, exceptionally, this proves impossible, a restructured
and reinforced Central Arbitration Committee (CAC) will decide
any of the following issues on which the parties are unable
to agree:
- whether
a trade union has reasonable support among the employees
for whom it is seeking recognition. This will rule out frivolous
applications;
- what
is the appropriate bargaining unit. Where there is disagreement
over the bargaining unit proposed by the union, the CAC
will apply criteria(2) including the
need for effective management, existing bargaining arrangements
and the desirability of avoiding fragmented units within
an undertaking. Employers must and will be free to organise
their business in the way they choose;
- whether
a sufficient majority of employees support recognition:
the CAC will award recognition where a ballot shows that
a majority of those voting and at least 40% of those eligible
to vote are in favour of recognition. This number will be
reviewed after the legislation has been in place for a period
of time so that it can be altered if it is shown to be unworkable.
- the
procedure to be followed for negotiations between an employer
and a trade union. Recognition will cover pay, hours and
holidays. The Government invites views on whether it
should also cover training. The parties would of course
be free to reach voluntary agreements on the issues to be
covered;
- there will
be a similar procedure for derecognition. The Government
invites views on exactly how this should work;
- new applications
for recognition or derecognition will not be considered by the
CAC until three years after the date on which a previous application
was determined;
- the procedure
will not apply to firms with 20 or fewer employees.
- A simpler
procedure should apply where employees are actually already
members of a trade union. Where over half the workforce are
in union membership already, so that they have clearly demonstrated
through membership their desire for the union to bargain for
them, then recognition should be automatic without a ballot.
4.19 The
Government intends that any trade union with a certificate of
independence from the Certification Officer should be able to
invoke the procedure, but the CAC will not deal with competing,
well-founded claims from trade unions. These must be resolved
by the trade unions before the procedure is invoked. There will
be protection against discrimination for employees who campaign
for or against recognition, including special protection for any
employees who are dismissed simply for asking for recognition.
Trade unions will have reasonable access to employees during the
campaign. The procedure will be as simple, clear and quick as
possible, with reasonable sanctions to ensure compliance. It is
intended to avoid disruption to existing recognition arrangements.
A fuller description of how the procedure will work is set out
in Annex I.
4.20 The
Government has listened carefully to all the views put to it,
and has designed these proposals to be fair, reasonable and workable.
They will avoid disruption of existing arrangements, which can
of course continue unchanged. As under existing law, individual
employees will continue to have the right, should they wish, to
agree terms with their employer. The new system will take some
time to bed in. We confidently expect the proposals contained
in this White Paper will contribute to improving relations at
work. We will, of course, need to keep under review how the new
law works in practice and make adjustments should any element
of it prove unworkable. We will take the powers necessary to do
this.
4.21 A
further area where the Government believes there is a need to
correct an anomaly is the provision which means that employees
taking industrial action risk dismissal for breaking their contracts.
Almost all industrial action is in breach of contract. If the
industrial action is unofficial - that is, not endorsed by the
trade union - then an employee dismissed for breach of contract
cannot claim unfair dismissal. If the action is official, a claim
can be made only if the employer has acted selectively - for example,
by dismissing only some of those taking action.
4.22 The
Government has no plans to change the position in relation to
those dismissed for taking unofficial action. However, in relation
to employees dismissed for taking part in lawfully organised official
industrial action, the Government believes that the current regime
is unsatisfactory and illogical. The Government believes that
in general employees dismissed for taking part in lawfully organised
official industrial action should have the right to complain of
unfair dismissal to a tribunal. In any particular case the
tribunal would not get involved in looking at the merits of the
dispute; its role would be to decide whether the employer had
acted fairly and reasonably taking into account all the circumstances
of the case.
4.23 The
Government is considering how to implement this in a simple and
workable fashion which avoids unnecessary burdens on the tribunal
system or ACAS. The Government therefore invites views on:
- the tests
which should be applied to determine whether dismissals in these
circumstances are fair; and
- procedural
aspects such as the possibility of grouped actions and whether
compensation should be at a flat rate or calculated individually
as for other unfair dismissals.
4.24 The
Government is also concerned that the law currently allows
for some discrimination against those involved in trade union
activities. The House of Lords ruled in “Wilson and Palmer”(3)
that the law allowed an employer to discriminate by omission against
an employee on grounds of trade union membership, non-membership
or activities.
4.25 The
Government believes that such discrimination is contrary to its
commitment to ensuring individuals are free to choose whether
or not to join a trade union. In addition, when a company has
recognised a trade union it is important that trade union representatives
are active in promoting effective dialogue with employees. The
current law may deter employees from being involved in such activity.
The Government therefore proposes to make it unlawful to discriminate
by omission on grounds of trade union membership, non-membership
or activities. The law already provides protection against
discrimination in recruitment on the basis of trade union membership.
The Government also proposes to prohibit blacklisting of trade
union members.
4.26 The
law and Code of Practice on industrial action ballots and notice(4)
also need reform. Present provisions are unnecessarily
complex and rigid. This makes it difficult for trade unions and
their members to understand their rights and responsibilities.
Complexity leads to disputes. One study suggests that three quarters
of the legal actions brought by employers against trade unions
concern the ballot and notice provisions. This is damaging to
business efficiency, as well as to trade unions. The Government
therefore intends to simplify the law and Code and welcomes views
on how this should be done.
4.27 A
particular difficulty is the legal requirement on trade unions
in certain circumstances to give to employers the names of those
they will ballot. Trade unions are reluctant to do so because
some members may not wish their trade union to disclose their
names to the employer. The Government agrees that trade unions
should not be forced to disclose their members’ names. It
therefore intends to amend the law to make clear that while the
trade union’s notice to the employer should still identify
as accurately as reasonably practicable the group or category
of employees concerned, it need not give names.
4.28 The
Government is concerned that individual employees, whether or
not they are trade union members and whether or not their trade
union is recognised, should be able if need be to defend or advance
their interests at work effectively. Most employers treat people
fairly, but a minority do not. The law should protect employees
from intimidation, and assist those who might have difficulties
in representing themselves.
4.29 The
ACAS Code of Practice on Disciplinary Practice and Procedures
in Employment recommends that employees should have the right
to be accompanied by a trade union representative or fellow employee
of their choice in disciplinary procedures. The Government believes
this recommendation should be made a statutory right. It therefore
proposes to create a legal right for employees to be accompanied
by a fellow employee or trade union representative of their choice
during grievance and disciplinary procedures. This would not
imply any duty on trade unions or other employees to accompany
a colleague if they did not wish to do so. However, anyone who
did accompany another employee would be protected against dismissal
or other action for doing so.
4.30 The
previous Government created two organisations to help people bring
legal action against trade unions. The Commissioner for the Rights
of Trade Union Members (CRTUM) pays legal costs or obtains legal
advice for members bringing cases against their trade unions.
The Commissioner for Protection Against Unlawful Industrial Action
(CPAUIA) does the same for people seeking to stop a trade union
organising industrial action unlawfully. These offices are held
by the same person, supported by five staff.
4.31 The
Government has no wish to protect poorly run trade unions, just
as it will not protect poor employers. But these arrangements
are inefficient and unnecessary. CRTUM has assisted only nine
applicants each year on average. CPAUIA has assisted only one,
which did not lead to a court case. And, as in any civil case,
the Government wants people to consider the alternatives to going
to court. The Government therefore intends to abolish CRTUM
and CPAUIA and give new powers to the Certification Officer
to hear complaints involving most aspects of the law where CRTUM
is currently empowered to provide assistance. This will enable
trade union members to secure their rights more easily and effectively.
4.32 As
the business world becomes more open and competitive, the pressures
on businesses to slim down through redundancies, more flexible
contracting-out arrangements, or to develop through merger and
acquisition will intensify. The Government has already consulted
on new arrangements governing the provision of information
and consultation when redundancies are planned or a business is
to be transferred, and on the protection of employment when a
business is transferred. The existing provisions have been
widely criticised and the Government intends to amend them. Employers
will in future have clearer obligations to inform and consult
recognised trade unions or, in their absence, other independent
employee representatives. Where businesses are transferred, the
law will strike the right balance between safeguarding employees’
existing rights and enabling businesses to adapt to changing circumstances.
1 Other
measures which will remain include those on picketing, secondary
action, ballots and notice before strikes, unofficial action, elections
for certain trade union offices and rights to join the trade union
of one’s choice and not to be unjustifiably disciplined.
2 The
full proposed criteria are set out in paragraph (v) of Annex I.
3 IRLR
[1995] 258.
4 Copies
of the current Code are available from the DTI Orderline - tel
0870 1502 500; fax 0870 1502 333 - quoting URN 95/915. The Code
is also on the Internet at http://www.dti.gov.uk/access/pl962.htm
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