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UK labor law update - June 2021

  • United Kingdom
  • Employment law
  • Labor law and trade union issues

22-06-2021

Welcome to our June UK labor law quarterly update. This edition contains the following content:

News round-up

Listen to the podcast

Recent labor case law

Eversheds Sutherland labor law publications, events and training

 


News round-up

Uber strikes ‘recognition’ deal with GMB

Following February’s Supreme Court decision which upheld the worker status of Uber drivers, the company announced that its UK drivers would be treated as workers with holiday pay, minimum wage and pension auto-enrolment rights.

This was followed by a ‘recognition’ deal with the GMB. While the details are uncertain, the GMB described the agreement as: giving drivers the choice to be represented by GMB; giving union representatives a presence in Uber hubs to drive up membership; ensuring that Uber and GMB work together on key topics including pay and benefits; and providing the GMB with a role representing drivers.

This development may set a precedent for other platform and gig employers, reflecting ongoing worker status litigation supported by trade unions including IWGB and GMB. Given the current uncertainty over determining worker status and calculating a gig worker’s minimum wage entitlement, as well as developments in other European jurisdictions (such as legislating to categorise some gig workers as employees), platform employers should continue to assess misclassification and reputational risks as part of their overall labor strategy.

‘Fire and re-hire’: Acas issues its report

Public attention has increased on the use of dismissal and re-engagement – termed ‘fire and re-hire’ – by employers when seeking to change employment terms and conditions in response to the pandemic. Unions and some politicians are campaigning for it to be banned and BEIS asked Acas to carry out a fact-finding exercise to inform its policy response.

Their report has now been published and the Government has yet to respond. The report confirms that the use of fire and re-hire has been in existence for many years and that it appears to be increasing. A wide range of views were expressed to Acas about the perceived reasonableness or otherwise  of the practice and whether, or how, it might be reformed. The Government has expressed concerns over legislating in this area, if it risks driving more redundancies or business failures, and may opt for non-legislative options such as improved guidance. In the meantime, employers need to be aware of reputational risk and of potential disputes and protest, if fire and re-hire is used.

The GMB union elects new General Secretary

The GMB has elected Gary Smith as its new General Secretary. Upon election, he immediately committed to ensuring the full implementation of the Monaghan Report –  a highly critical 2020 report, by Karon Monaghan QC, into sexual harassment complaints and how they are handled by the union.

The election of a new General Secretary at Unite is also underway with the results being announced on 26 August 2021.

Trade union membership is rising – in the public sector only

The proportion of UK employees who were trade union members grew slightly to 23.7% in 2020, up from the low of 23.3% in 2017, driven by rising female membership and by an increase in public sector members. There was a significant fall in trade union membership numbers among private sector employees to one of the lowest levels since the series of statistics began in 1995 (12.9% of private sector employees belonged to a trade union, compared to 51.9% of public sector employees in 2020). Read the statistics here.

Government to make changes to Certification Officer powers and funding

The Trade Union Act 2016 included a new power for the Certification Officer (CO) to impose financial penalties on trade unions for breaches of their statutory duties (e.g. a failure to conduct their elections properly). Four years after a consultation on the proposed financial penalties, the Government has now confirmed that it will publish regulations to implement, from April 2022, a maximum penalty of up to £20,000.   

Enhanced investigatory powers under the Act will also be commenced from next April and regulations will be introduced requiring trade unions and employers’ associations to pay a levy to the CO by way of contribution to its costs (the CO will set the levy). Currently, the CO’s costs are met by the taxpayer. Further details: the levy and penalty regime.

Recent labor case law

UK strike law is incompatible with human rights law: Mercer v AFG Ltd and Others

The Employment Appeal Tribunal (EAT) has held that UK strike law is incompatible with human rights law and it must be reinterpreted to comply. This is a significant change in the law and is particularly relevant where an employer contemplates taking action against those striking, other than deducting pay for work not done during the strike.

The law had been interpreted as not providing protection from a detriment where an employer subjects a worker, participating in industrial action during working hours, to a detriment such as withdrawing benefits or taking disciplinary action. However, the EAT held that this failure amounts to an unjustified infringement of Article 11 of the European Convention on Human Rights and that words should be read into the legislation to include such protection. Read our briefing on Mercer.

The important role played by Convention rights in UK labor law was also illustrated by a recent Court of Appeal decision (National Union of Professional Foster Carers v The Certification Officer). While fact specific, the Court held that denying foster carers, who are parties to particular forms of foster agreements, the right to form a trade union is an unjustified breach of their human rights.

Enforcing UK EWCs after Brexit: easyJet EWC v easyJet PLC

In a significant decision, the Central Arbitration Committee (CAC) has, in broad terms, decided that the EWC enforcement regime that existed before Brexit has largely been retained for UK based EWCs, with the exception of those provisions which provide for the setting up of new EWCs. However, the decision requires careful consideration depending on the facts for each employer, for example, whether the EWC has moved to a new jurisdiction with the agreement of the EWC representatives. For further information, please contact thomasplayer@eversheds-sutherland.com

Rewriting collective agreements: Tyne & Wear Passenger Transport Executive t/a Nexus v RMT Union & Unite

The parties negotiated a change to a collective agreement (the 2012 Agreement) involving pay. Subsequently, union members successfully brought tribunal proceedings claiming that they had been subjected to an unauthorised deduction from wages on the ground that, on the proper construction of the 2012 Agreement, they had been underpaid. The financial consequences of these tribunal proceedings were substantial for the employer.

The employer went to the High Court to, in effect, add additional words to the terms of the 2012 Agreement, arguing that there had been a mistake as to its proper construction. In an unusual and technical case, which travelled into areas of law not usually visited by employment lawyers and HR practitioners, the trade unions argued, in broad terms, that the employer was not legally permitted to apply to the Court for the 2012 Agreement to be rewritten. Dealing only with this argument as a preliminary issue, the Court disagreed with the unions and allowed the employer to proceed with its application (which is yet to be decided). While a technical decision, employers should take note as it may provide a potential remedy where conflicting constructions of collective agreements are causing disputes.

Incorporating collective terms into employment contracts: Hamilton v Fife Council

H, a teacher, was told that as a result of surplus staff, she was liable to be transferred to another school pursuant to the applicable collective agreement. The school then advertised a full-time position in her department. In proceedings which went to the EAT, H argued that the term of the collective agreement, which provided: “Unless there are teachers who have been designated surplus, any permanent post will normally be advertised” was contractual and the school was in breach of her individual contract of employment.

The EAT agreed that the collective agreement had been incorporated into H’s contract. However, it remained necessary to consider whether any particular part of that agreement is apt for incorporation – this is a matter of contractual construction for which case law guidance exists. For example, truly collective terms have been held not to give rise to enforceable employee rights, such as redundancy procedures which may be no more than a broad statement of intent. In this case, the EAT decided that, due to its vagueness and lack of details, the term regarding advertisement was not intended to confer the right on H to prevent the employer from advertising a vacant post.