Katie Jacobs from the CIPD, and I'm going to be hosting this webinar. Over the next hour or so, we're going to be discussing one of the most challenging and important topics facing HR professionals right now, working constructively with trade unions to get through this current Winter of Discontent.
Joining me to discuss this topic, share their wisdom, and take your questions, I have a fantastic panel of experts. I'm joined by Rachel Suff, Senior Policy Advisor at the CIPD, and author of our recently updated CIPD guidance on working with trade unions. Also got Melanie Simms, Professor of Work and Employment at Glasgow University, an expert in worker voice and collective representation of employees. Michael Jude, Human Resources Director at Nissan. And last but not least, Vince Toman, Senior Employment and Health and Safety Lawyer at Lewis Silkin. Thank you all for joining us this afternoon.
I'm just going to run through some housekeeping notes before we get on to the topic. Firstly, the session is being recorded. It will be available on demand via the webinar section of the CIPD website this afternoon or early next week. You'll be able to access all of our previous webinars there, as well as find out about upcoming ones. If you would like to submit questions to the panel, and I'm sure you do have a lot, can I ask you to type them into the Q&A box and not the chat box, because we're not going to be monitoring the chat box that closely. However, you can use the chat box should you wish to chat to your fellow attendees, just make sure you use all panellists and attendees to share with everybody.
I'd like to remind you that CIPD members can access individual legal advice via our HR Inform Helpline, which is available to you 24/7. We won't be able to get into any highly specific situations here, so do please use the helpline if you need additional advice. And I also want to flag our Wellbeing Hub and Helpline, which is available for members in the UK and Ireland. You can use this to access free help and support via telephone or online consultation with qualified therapists, that's provided via Health Assured. We know it's really, really tough out there at the moment, and a lot of you haven't had a break in the last, going on three years now, so please do remember to look after yourselves, and we are there to support you.
So, on to the topic at hand. Unless you live a particularly isolated or charmed existence, you will have noticed or been impacted in some way by the recent rise in collective industrial action. Activity is at its most intense and serious it has been in the UK since the 1970s. We've seen industrial action this winter from railway workers, bus workers, teachers, civil servants, postal workers, nurses, ambulance workers, even driving instructors. That has led to the government proposing a strikes bill based around minimum service levels in Parliament. And we will hear about that through the presentation and discussions. This dramatic increase in collective industrial action and shifting legislative landscape clearly shows just how important it is for organisations and people professionals to develop effective ways of working with recognised trade unions. However, a decline in trade union membership and tighter regulations around industrial action has had an impact on the HR profession. Many in the profession, and especially perhaps those younger members of the profession, have little experience in working with trade unions and in effectively resolving collective disputes. So via this webinar section, session, and our updated, updated guidance around working with trade unions, we're going to share some good practice and advice around how organisations can work constructively and effectively with recognised trade unions, and on fostering healthy and productive working relationships with employee and trade union representatives.
Our panel are going to share their insights, experience, and advice, and take your questions. In terms of running order, we'll hear from Rachel first, who is going to give a little bit of context, and share some of the recent CIPD research and guidance on this topic. Then we'll hear from Melanie, who's going to be sharing some insights from her research and experience about what good effective practice in this area looks like. Then we'll hear from Michael, who will share his experiences of working constructively with trade unions at Nissan. And finally, Vince will give a quick refresher around our legal obligations in this space. Then we'll have a bit of a discussion and Q&A. Please do get your questions in throughout. Always when I do these things, in the last five minutes there's 100 questions put in, so if you have something in mind, just type it down the second that it comes to you, and that will help us to get through as many as possible. But that's enough from me, so I will hand over from, to Rachel to kick us off. Thanks, Rachel.
Rachel Suff: Thanks, Katie. Yeah, so as Katie said, barely a day goes by at the moment without a media report of at least one strike, often more, particularly across public services, of course. And I think for us as people professionals, and for employers as well, the disputes are, first of all, a sharp reminder of the continued influence and importance of trade unions, especially in key sectors, but also the need, standing back a bit, for organisations to build positive employment relations as far as possible to avert industrial action.
And often, if we look at the, the next slide, we see the current climate compared to, or even referred to as the Winter of Discontent. Even references to the General Strike in 1926. And I think the fact, first of all, that we are comparing to those very significant periods in employment relations history, shows how long it's been since we've seen the kind of widespread ongoing industrial action that we're seeing at the moment. It's interesting to compare back to those periods, but those periods were very different. It isn't a general strike. We're seeing co-ordinated action, particularly on 1 February. Those periods in industrial relations were very different. You didn't have the amount of trade union legislation that there is now, limiting the ability of other trade unions members, workers, to go out in support of other workers, which is what happened in the general strike. It was coal miners who were locked out, and then the TUC called all out, and other workers went out. You can't have that, that kind of secondary action now. So it isn't a general strike that we're seeing at the moment, but what, there are some areas that the disputes have in common.
First of all, real difficulties in the economy, inflation running high. In the Winter of Discontent, there was high inflation, wages not keeping up. So there are points of similarity, definitely. And I've put there some figures around huge levels of working days lost to strike action, particularly in the General Strike of '26. But, yes, it looks, if we see November, the number of working days lost, over 450,000, that doesn't seem very high. But if you think in terms of recent trends, in the number of working days lost to strike action, in the whole of 2019, there was, ooh, around half that number lost. So it's significant still in terms of the amount of strike action that we're seeing, definitely. And it's not just a numbers game either. The disputes that are taking place at the moment are significant, they're going to have an impact, well, they're already having an impact. But they're significant in terms of what the future holds for employment relations in those sectors as well. And we know that we've got, also I think the, the significance in terms of those disputes becoming long, much more entrenched, long running, and then positions can get much more adversarial and entrenched and, you know, what does that mean long term for employment relations in those sectors? We know that we've got members, HR professionals, and managers as well, who've worked hard to build up really good relationships with trade unions in those sectors as well, and it's a very challenging environment for public services over the last few years as well. So, you know, it's a complex situation.
I can't go into any detail in terms of what are the causes of the disputes. Obviously, I've already mentioned pay rises and wages not keeping up with inflation. No doubt that's the catalyst. There's a potent recipe for dispute, for those collective disputes in public services in particular, although there are some other disputes in private sector as well. Amazon, we've had barristers go on strike, Amazon, one of their warehouses, people went on strike there this week. But, although the disputes over pay are very, are significant and real, I think also there are more complex, deeper, deeper seated issues at play in, in some of these disputes as well.
But if we go onto the next slide, what I want to look at, touch on, and I think Vince from Lewis Silkin, and it would be great to have his perspective, is going to talk about the new proposed legislation as well. Is it going to be helpful? Is it necessary? So the government has introduced the Strikes Minimum Service Levels Bill in Parliament. I mean, the first thing to say is that that legislation won't make any difference to the current disputes, because it's only just been introduced, but is legislation the answer? On the face of it, it doesn't sound unreasonable, does it? The rationale is an emotive one that's put forward for the, put forward by the government for introducing this new law, to ensure that striking workers don't put the public's lives at risk. You know, that's quite an emotive rationale. I think the first thing to say is that actually, what we've seen in the disputes, in the ambulance service, and in nursing and so on, is that actually at a local level, employer and unions, and they've done this traditionally, if you look back at previous disputes over the years, they have agreed minimum service levels to try and help ensure the health and safety of the public, and so on. And we would say that actually, that local negotiation is probably more helpful.
But what's the likely impact of the legislation that would affect six sectors, like health education and so on, if this legislation was introduced? And I think, first of all, it's important to say that the law isn't always a silver bullet. It often has unintended consequences, and there's far reaching implications if it was introduced as well. Not to go through it in great detail, but essentially, an employer would be able to give a work notice under the law to a union, requiring certain workers to work, to ensure that those minimum service levels are agreed and put in place. And if the union fails to take reasonable steps to ensure that workers do comply, that union loses its protection from liability. And also there are implications for people who work and strike in that organisation. They could lose their protection from unfair dismissals. So there's, there's really far reaching implications. And also it could mean the loss of workers in sectors like the NHS that are already really facing serious workforce shortages.
We think, at the CIPD, that to legislate as a first step is premature. It's the speed at which it's progressing as well, means it's unlikely to receive the scrutiny and refinement it needs, and we just don't think it's necessary. If we look back over the past few years, decades, actually, we've seen the passing of quite stringent pieces of legislation, limiting the ability of trade unions to take industrial action, like voting around ballots and so on. There's a high bar now to reach, to actually be able to go on strike. But fundamentally, we just don't think this legislation will solve the industrial relations problems that we're seeing, prompting the current strikes. Also, the risk is, that if you outlaw and make it so difficult to strike that people can't really effectively do it in, in any way, what you could see then is things going, that discontent going underground, and you can see unorganised conflict happening, like individual disputes, high staff turnover, sickness, absence, very low morale, performance. These impacts will have a serious implication on the level of, and quality of public services as well. So that's not, you know, let's not underestimate that. And also, I just think bringing in this legislation is contributing to this environment that I think we're seeing of more confrontation, more escalation. And the government did an impact assessment relating to this legislation when, last autumn, when it was going to bring it in just for transport. That impact assessment is not very supportive of bringing in this legislation in terms of the impact it's going to have. It actually said that it had the potential to have an unintended negative impact on industrial relations, which could have detrimental impacts for all parties. It also pointed to the scenario where if employers and unions didn't come to an agreement for a suitable minimum service level, you could have a judicial review process. There could be many months of legal, protracted legal disputes. But I'm really interested to see if Vince, you know, can elaborate any, any more on, on what the potential legal implications could be.
So we think that having collective negotiations, and that's not to say, that's not to underestimate the complexity, the difficult, challenging environment in which negotiations and these disputes are taking place at the moment. But in the long run, we still think that's a more productive approach, so as to not damage those long term relationships as well that have been built up, built up with trade unions, and also the wider, sort of, morale and climate around employment relations as well in the workforce. It is a delicate balancing act, and I think in the public sector as well, setting pay isn't necessarily in the gift of the individual employer, it's more complicated than that. So it is a difficult balancing act. I would just say as well, I wonder if there's more roles for ACAS in these disputes. I don't get the impression that they've been called on as experts in collective conciliation. Where things have become entrenched, like these disputes obviously have, in a lot of cases, having real experts in collective conciliation trying to encourage both parties to just step back, see the different sides, where is there potential for compromise, other solutions, looking at other terms and conditions, any, you know, anything that could be brought to the table? I think, you know, that could be explored more.
On my final slide, just some key points really, to sum up. I've already said, trade unions, a very important part of employee voice on a collective basis. We need individual channels of collective voice that are direct, you know, direct to the employee, but we do need collective ones as well. They can enhance employee voice and employee engagement. There's a lot of research pointing to that. And so employers, and of course, our people professionals, need to take them seriously, engage constructively with them, which I'm sure everyone on this webinar is aware of. There's a very long tradition, especially in the public sector, of collective bargaining, effective collective bargaining. I started my career in employment relations about 30 years ago as a convener in NALGO, in local government. So I've been on that, you know, on that side of negotiations as well. I know negotiations can, can become testy. That was the poll tax, and there was, you know, I remember strikes around the poll tax as well. So, you know, it, I'm not underestimating how challenging, how testing, what a big investment people professionals and trade unions need to, need to put into these negotiations. But there were some positive findings in this report, and survey, and research, and case studies that we published last, last July. And it was a brilliant project to work on. I interviewed trade unions, HR leaders, and there are some great examples in there of partnership working between employers and unions, and a real willingness to work together. So you can see there, you know, almost six in ten said that working in partnership can benefit the organisation. So it was, there were some very positive results coming through. So I think we have got the potential to build that constructive, positive employment relationship with trade unions.
Final thing I want to say, in terms of what does this mean for people professionals? I think a lot of people professionals, because of the lack of unionisation in so many parts of our economy, just haven't had the opportunity to work with trade unions. And I think that is part of the reason that it, it's slipped somewhat in terms of the profession, and it being seen as an aspirational career choice. You know, also those skills and knowledge that we need in the profession. So I think we really need to reassert that and make sure that we have that specialism in the profession. Finally, I think we should take heart from the many examples through the pandemic, particularly in public services, in how employers work together with trade unions and their members, to really run essential services in the most challenging circumstances during the pandemic, and keep employees and the public safe. So we can draw on that in a positive way. And, you know, we mustn't forget that in this current, seemingly very adversarial environment. Thank you.
KJ: Yeah. Thank you, Rachel. Really, really useful, and the team have put those resources in the chat. Going to hand over to Melanie. I believe Melanie has no slides, she is just going to share her, her wisdom. Thanks, Mel.
Melanie Simms: Thank you very much. One of the first questions I was asked to reflect on is, what does good industrial relations look like? And I, I think that's, it's, it's almost impossible question, but what I can say is that it doesn't look like no conflict. Those of us who study industrial relations and, and think about the nature of the employment relationship, start within an assumption that conflict is embedded in this complicated, messy relationship, and that there, there are always going to be tensions, even with the, even between groups of workers, let alone between managers and workers. So we start with an understanding that conflict is inherent in this relationship. That different people are trying to get different things from it at different moments in time. And industrial relations is really about looking at the structures, the formal structures that try and regulate that conflict, that give spaces for listening, and negotiation, and compromise, that then allow a collective regulation of those, of those complicated forms of tension. So that listening, negotiating, and eventually compromise, is absolutely core to, to what we're doing, and what we're trying to think about how to do better, in, what, in good industrial relations settings.
And that's particularly challenging because to some extent, compromise requires power sharing. It requires a sharing of the, the inherent power that managers have over the, instructing people about what kind of work they're going to do, and how they're going to do it, and how much they're going to get paid to do it, and all of those kinds of things. So it's often that power sharing that I think can be very difficult when people haven't really thought through the, from first principles, if you like, the nature of the employment relationship, what managers are trying to do, and then what that collective regulation is then trying to do. And as Rachel very clearly said, if, I mean, we know from lots and lots of evidence, if you don't have collective mechanisms for expressing these forms of conflict, they will emerge in other ways. It's not that the conflict goes away, it emerges in other ways. That could be in high turnover, it could be in high sickness levels, it could be in difficulties in recruiting, or whatever. So there's a vested interest in, in everyone in this relationship really trying to understand what's going on when we're trying to negotiate collectively.
And to do that, those relationships with trade unions, which is the main form of collective representation in the UK, it's not the only form of collective representation, but it is the, the main one, it's one that's mainly about negotiation and compromise. That can be really challenging, particularly for our line managers, I think. It can be really quite hard. We have to have, be a very confident line manager to be able to be confident to have your decisions challenged, to take longer to make these decisions, because inevitably that period, that period of reflecting, and listening, and negotiating compromises takes time, rather than a manager just saying, we are going to do it this way, because I have decided we are going to do it this way. That requires good policies. It requires training line managers. It requires being very clear about the implementation of rules, about testing the boundaries of where rules don't work, where they fall down, etc. And I think for our line managers, often that's about really getting them to reflect on the pros and cons of ploughing ahead in a unilateral manner, versus involving staff, and really hearing their voices, and integrating them, often through a union representation.
So I think with our line managers at local level, there's lots of things we can do, but I think a lot of these disputes are actually not at local level, they're, they're because of forms of multi-employer bargaining, which has, kind of, been alluded to both in the questions and in some of Rachel's comments. And multi-employer bargaining in the UK is now very rare outside the, outside the public sector, but it does still exist in the public sector. And essentially, what that requires is a group of employers make, that could be hospital trusts, it could be universities, it could be, whatever it is, getting together to decide what their position is. And that inevitably, so both sides are negotiating collectively. And I think that does add in extra complexity to some of these discussions, and particularly because that's a feature of public sector employment relations, where the government is ultimately often the funder of some of these services, it brings in a third party in the form of the government, even if the government isn't formally at the negotiating table. So I think there's lots of issues about the legitimacy of the positions taken by collective actors, when you're that abstracted from the day to day line management challenges of, of getting work done.
Added to that, some of these disputes are actually about pay review body decisions. And pay review bodies are a very particular institution in the UK, intended to regulate the terms and conditions and pay, particularly the pay, of some key occupational groups, particularly in health, but also in teaching, for example. And those are made up, they're expert panels made up of people who know about employment relations, you know, civil servants, people with management experiences, lawyers, academics who've got some sort of background in this. And they were originally intended to try and take the politics out of that heated, free negotiation. That free collective bargaining that, that, that, that multi-employer bargaining sometimes creates some heat. Clearly that isn't working anymore, and indeed these have become highly politicised decisions. And that's really been a shift since about 2017. So from about 2017, there was a series of decisions by various ministers to not implement the decisions, the, the judgement of the pay review body, their recommendations. And that was really rare, I mean, almost unheard of prior to that. But what that did was, by ministers overruling the pay review bodies, and this was in the context, of course, in, of austerity, it created a lot of bad feeling, and it created a lack of trust in those, whether the pay review bodies actually could deliver what they were supposed to deliver. Now, I would argue that's not the pay review body's fault, but it, it created a, a difficult context for these pay review bodies to operate in after that. And I think we're reaping the consequences of some of those difficult decisions. That's then exacerbated by the fact that the real up tick in inflation in 2022 happened after the recommendations of the pay review bodies. So they happened mid cycle. And pay review bodies were never intended to act as a, as an ongoing review of pay recommendations. They have their cycles. So in the context both of multi-employer bargaining and pay review bodies, we've really, kind of, got, got a particularly difficult set of issues to resolve in this current spate of industrial relation, industrial unrest.
And then the final question I was asked to reflect on was, what are the different elements we need to get right in order to build healthy working relationships with unions? And unsurprisingly I think, in those very different settings, I think we need different, different things. So at local level, listening, taking a breath, make sure our line managers are well trained, building those relationships, etc. Making sure they understand about negotiation rather than, sort of, set piece, just, just, yes, yeah, yeah, yeah, yeah, and then not actually doing anything as a result of consultation. One of the crucial things I think we sometimes forget, the principles of negotiation are the same whether you're negotiating a pay rise or whether you're negotiating the price of a car. The, the difference with the employment relationship is that, of course, it's an ongoing, open ended relationship, so things are remembered. They set the tone for the culture of next year's round of negotiations, etc. And I think that ongoing nature of industrial relations is really crucial for our managers and negotiators on all sides to really understand. Time is also crucial. It can really take time to, to negotiate collectively. And I think one of the things managers often benefit from really reflecting on, is that that can be longer on the side of the union rep, because they have, they have more formal processes to go through, to go through, to check that the members will support the, the negotiated outcome. Whereas often for managers, that's a matter of checking with the CFO or the CEO and, and getting a yes or a no. That process for unions can take quite a long time. And I go back to this concept of good faith. Doing this in good faith. I, I've regularly joked on, on Twitter that if only we understood the, collective, all of us, the, the concept of good faith bargaining. Recognising we don't have the same interests, but going into that conversation, in, with a real openness to, to reaching an agreement, to changing our position, to reflecting, to see where the points of, of trade offs can be, to see where we can both end up in a better position as a result of the conversation, etc. And I think sometimes we forget that idea of good faith.
Finally, I just want to talk about, what, what, what's needed in those multi-employer bargaining settings, because they are more of a set piece negotiation. They're often very formalised, they're often quite abstracted from the, even from the organisational level, let alone from the, the line management level. And there, I really think one of the challenges we've got at the moment is this question of legitimacy. Being confident on both sides, that if you can reach an agreement in the room, the, the people in the room then have the power and authority to go away and deliver what's been agreed. Because it's very challenging for the negotiators if they have a, a hesitancy about that. And what that looks like on the two sides is slightly different. So for unions, it's about going through that process of being confident that, that the membership is behind you or not. And then for employers, it's really, and particularly employers in the public sector, being confident about where your, your lines of funding are and, and where, where you, how you're going to operationalise some of these decisions. So I'll leave it there and pass back over to Katie.
KJ: Thank you, Mel. And it's like, you've been reading the questions, because I think you answered quite a lot of them there. So, I'm going to hand over to Michael now, who's going to give a quick overview of how this works in, in real life.
Michael Jude: Thanks, Katie. And thanks, Melanie, as well. You, you've pretty much covered everything I was going to say, but from a, a, from a practical point of view. What I would start off with, just to, to explain to everyone on the call, so I'm the HR Director of the Nissan Sunderland plant. So we have about 6,000 employees, and we're quite unique that we've, we're in a collective agreement as well with our design centre down in Cranfield. So a very different geographical location, different group of employees. So our collective agreement with the union and the works council is quite complex, it's not just the manufacturing site.
And firstly, I think I'd probably start with saying, I'm, maybe I'm mad, but industrial relations is my favourite part of HR. I started as an employee relations advisor when, at the start of my career, and I've loved it ever since. So, I really enjoy this subject, I've got a bit of passion for it. And just to, to, sort of, echo what Melanie said, and I think the key thing for me to start off with all of this, is to make sure that you've got that relationship. Now, I've been fortunate, I've been at Nissan for 13 years now, and I've just continued what we've had over the last nearly 40 years, where we've been fortunate enough to not have any industrial action. And part of that is that we pride ourselves on having that great relationship. But it's definitely that, it's a, it's a relationship, it's two way. So if I just give some examples of how, how we manage the relationship and what we do together, and will echo a lot of Melanie's points. So firstly, I would say that this isn't just an HR topic. We've got to make sure that it's, it's not just me. I can have a good relationship, but I need my whole HR team to be looping in with the, the, the representatives, And then the bigger part of it for me is making sure the business understand it as well. It, it's no good having any of this if the business, who ultimately make a lot of the decisions, don't understand the repercussions, don't understand what, what happens when things go wrong. Or right, when you are in any level of negotiation or issue ongoing. So we work really hard as an HR team to make sure that all of our line managers, so that's the, the supervisors of our 4,500 people on the shop floor, all the way to our C level executives, understand what this relationship is, and how it works, and what, what both parties get from that. So that, that's a real important part of my job, to make sure that that, that goes around and, and everyone understands that. Now, it's not as easy as that, obviously, it's still complex, but that is how I always have at the forefront of my mind, to make sure this, this works, that the business own this and are bought into it.
And then again, Melanie mentioned the exact thing is that you, you do all this in good faith. You, whether that is negotiating about a pay award, or whether that's just your general day to day relationships, it's, it's not trying to get one-upmanship, or winning, you do it all in good faith to try and have that successful relationship, and to really help with the continuity of the business, throughout whatever difficult times you're going through. So that, that's really important. And again, I think maybe sometimes other colleagues I know from other companies don't really have that ethos, it's a very much us versus them dynamic that goes on.
Some of the things that we do, just in terms of some examples, so we, whenever we have an issue, say whether that's pay or, we've recently had problems with our production volume because of semiconductor availability, we will make sure that we go to the, the, the representatives and actually get their opinion on what the solutions are. We don't go with them and say, right, this is what we propose, do you agree to it? We, we loop them in. And again, what you get from that is, they are the voice of the shop floor for us. They, they know the exact pinch points that will upset our, our workforce. So looping them into the solution means it's much easier that, well, one, you get the right solution in the end, but ultimately you get there much quicker, and you don't miss anything out. So that was one example of our, of our volume flexibility agreement from last year that we agreed with them, that was really successful, and really helped the business go through the turbulent time of, of the semiconductor shortage.
Then when we get into more general relationships, I would say, I mean, we do a, a monthly business news cascade to all of our workforce. So every month they get a, a business update about what's going on in terms of sales, profitability, quality, etc. And we make sure that we get all of our representatives to see that in a, in a briefing with our vice president, just so they really make, they feel like they're part of the team. They don't get it just when, when the rest of the workforce do, we, we treat them as a special group, because we want them to make sure that they understand the business as well as everyone, including the senior leadership team. We also just have general, it's, again, I don't want to teach people to suck eggs here in terms of what we do, but I would say I speak with the, the representatives several times a week as, as a minimum. It's, it's probably daily. And again, and, and the HR team do that as well, just to make, have that regular catch up, that, to know what's going on, get the feeling of what's happening with the workforce, bouncing ideas off them about what's going on. And all that does is help with, with that longer term relationship. Again, what, what I would hate to have to do is every two years, when we do our pay negotiations, to go in cold with, oh, well, inflation's really high, so can you take this? No, you build that up over the, the weeks, the months of, of talking to them, having that open dialogue. And it's really important, like I say. It sounds like such a basic thing to do, but it's fundamental for me to get this right. If you don't do that, you will fall down, I think.
And with that as well, it's to make sure that you fix some of their basic problems for them. I mean, as I say, we're, we're a large site, so we have some particularly easy things to solve, whether that could be that the turnstiles are broken, and there's issues with the car parks. What we ask the reps to do is feed that in to us, and we'll be accountable and fix them for them. And that just helps to know that they can trust us to, that we will deliver on what we, what we promise on. And it can, say, something basic as fixing a, the turnstile for staff to get into the, into the site, but they know that, that, that we'll follow through with it. And they know they can approach us with issues like that as well. So it's really, again, simple stuff, but unless you get that right, like I say, the bigger things fall down.
One thing I would say as well, despite the fact of all the good relationships we have and how we work together, we can't always agree either. Pay is the most common thing that we have issues with, and inflation's sky high. So again, what, what, what we try and do is we share as much business information, information with them as possible. Talk about our future models, what we need to do to remain sustainable into the 2030s and '40s. And when you hear all the rhetoric, and the shop floor are talking about needing an inflation pay award, we'll show them facts and figures to show that, what that will do to our competitiveness moving forwards if we paid inflation. Hey, we'd love to, we'd love to do that for everyone. But if we did that, we'd probably pay ourselves out of a job within a few years. And actually showing facts and data to prove that helps us get around that type of conflict, that we might not all agree on what the figure is, but because we know, we all know we're doing it for the greater good, they can buy into it. But by showing facts and data, and proving it, it's not just that they're taking my word of mouth for it, or the, the MD's. We can say, look, this is what we want to try and achieve in the next 20 years. This is what we need your help with to do it on. So that really helps as well. And again, I think that's, I'm conscious of the time as well, I know Vince needs to speak and there's, there's time for Q&As. So hopefully that's been enough just to give a bit of a flavour about what happens practically on the ground, and, and happy to answer any Q&As at the end, if that works, Katie?
KJ: Thank you.
MJ: Was that enough time?
KJ: Yeah, that was, that was brilliant. We, yeah, going to hand over to Vince. I'm going to ask Vince to speak at 1.5 speed. And then we'll go to questions, because we've got some really, really good ones. Vince, over to you.
Vince Toman: (no audible response)
KJ: Vince, I think you might be on mute.
VT: I'm going to put that on my headstone. I'm on mute. Can we have the next slide please? There's an old adage, which basically says, is that an oral agreement is not worth the paper it's written on. And this has become very much to the forefront in the way in which case law has progressed in the UK quite recently. And I'm not going to go back in history because of time, but, but Wilson and the UK was a landmark decision that went up to the European Court of Human Rights. And that should not be confused with the European Court of Justice, which unfortunately does get confused quite often. Which resulted in the legislation being changed to say as that, you cannot make an inducement to employees who are subject to collective bargaining for them to give up their collective bargaining rights. And that was brought in, and was amended and, and, following the decision of Wilson and the UK. Because what happened was under the Conservative government, they said is that you could actually make better offers to people if they gave up their collective bargaining agreement. So that was basically set. What none of us quite realised was that the full extent to which section 145B of the Trade Union Labour Relations Consolidation Act 1992, always nice short titles in employment law, would, would have the impact.
But then we had this case called Kostal. And Kostal was a lesson in, in, to read your collective agreement, and to make sure that you followed the collective agreement that you had read. And what happened was is, that Kostal had decided, is that just, they just recently recognised Unite, peer negotiations were not going very well. They agreed that they would go to ACAS, but then decided that they wouldn't agree to go to ACAS, but there was no requirement under their collective agreement which said they must go to ACAS. They said the parties may want, wish to go to ACAS, but hadn't given that indication, and they withdrew it, and they'd made the offer directly to the employees. Now, this is a case about, about a breach of section 145B. It went to the employment tribunal, the tribunal agreed with Unite. It went to the EAT, the EAT agreed with Unite. It went to the Court of Appeal, and the Court of Appeal didn't agree with Unite, and that it ended up at the Supreme Court. And therefore this is the defined position. And what the Supreme Court held, and I, we've used the phrase, and I noticed that both Melanie and both Michael used it, the phrase about good faith. Now what this case basically says is, is that you cannot go and make an offer to the employees as the employer, unless you genuinely believe that the collective bargaining agreement has been complied with. That you have completed all the stages of your collective bargaining agreement. And it is only after that period of time can you go forward and make that, and not make the offer, but make the payment that you were offering to the union. No variations whatsoever directly to the employees. And that was the fundamental issue in Kostal, and Kostal got it wrong, and it cost them £4,554 per employee, which was more than the pay offer, and which was more than the bonus that they were asking to accept so they could move, move forward.
So you can make these unilateral decisions, but only after you have completed the entire process. And I'll go back to the amount of clients that I deal with who say to me is, we have a collective agreement, but it's not very clear when it's ended. You know, sometimes we make two offers, sometimes we make three offers. Well, my advice to every one of those clients, and my advice to everybody on the call is, is that if your collective agreement is unclear, then you need to make it clear, because this can be a very expensive error if you, if you get it wrong. But what is significant about this is that, is that this has given the trade unions, not the right to veto pay agreements, but certainly the right to go through the process to its conclusion. And that's my piece of advice. Next slide please, because I'm conscious that we want to talk about things.
Now, the thing about, strikes me about this particular slide is the use of the word Supreme Court. And everybody is trying to get to the Supreme Court so they can get a determinative decision. Tesco was about the employer making a, a decision that they wanted to open some new stores, and like in all good employers, they want some of their better employees who have used to working in their stores, moving to the new stores. So they offered them this incentive that if you move to the new stores, your terms and conditions would be, would be protected. After the stores were opened and became successful, is, Tesco realised is that they then had this pay anomaly between these new stores, which were now old stores, and their old stores, which had always been old stores. And therefore they decided that the people who'd moved over to the new stores should go back on to the terms and conditions that they'd previously been enjoyed. Surprisingly, the union won an injunction, preventing the, Tesco changing the terms and conditions. And I say that's unusual is because part of getting an injunction is, is that damages are not an alternative remedy. Well, clearly, if you're getting paid, then damages are clearly an, an alternative remedy. So what the Supreme Court said is that it was up to the employer to decide whether they want to hire and refire, and to offer the new agreement to the employees and the, within the collective agreement. So that's a, kind of, a, just a restatement of what we've all understood. I mean, the only people I know, who I've ever dealt with who get injunctions is head teachers because of the damage to their reputation if they were to be dismissed, to prevent the dismissals. You go to Ireland, and everybody is entitled to get an injunction to stop them being dismissed. So it's a UK thing.
Deliveroo is going to the Supreme Court, and they will make a decision as to whether riders are independent workers or, sorry, are independent contractors, or workers. Interesting in that Deliveroo has actually signed an agreement with the GMB, a collective agreement, or a partnership as, as it's called, with the GMB, is in relation to the independent contractors. And therefore it may be seen is that, they anticipate there may be some difficulty at the, at the Supreme Court, but I, I can't comment on that for, for a variety of reasons. And mostly, a more interesting case is the Mercer case. I have been involved in a number of closures of final salary schemes for future accruals, and one of the things we've always put forward to the union is, and to the workforce is, that we'll have a peace payment. So there's no industrial action when we're closing the final salary scheme to future accruals, that at the end of it, you get a bonus, ie, you get a no, no industrial action payment, but it's always called a, a peace payment, or a continuity payment, or some other description. What Mercer will make a decision on is whether or not taking part in a strike falls within the protection for taking part in trade union duties and activities. It has always been held in this country, up until recently, the Mercer case, is that taking part in the actual industrial action, rather than organising the industrial action, going to meetings to decide whether there should be industrial action, is, is, fell outside of the protection of trade union duties and activities. And Mercer will have to make a decision as to whether or not it comes within the definition that they were taking part in trade union duties and activity at the relevant time. The Court of Appeal made the decision is that the UK legislation was not compliant with Article 11 of the European Court of, of Human Rights, but that it was not its role and function to change the law. But it's gone to the Supreme Court, and the Supreme Court will make, will make a decision.
Moving swiftly on, the agency workers, I find, I find this a, this is merely noise, if I can put it bluntly. Is the idea that somehow is, that agency workers are going to solve the, the current industrial relations problems. Well, first of all is, if you're a train driver, you need to be a train driver. You know, if you're an airline pilot, you need to be an airline pilot. If you're a nurse, you need to have a qualification. If you're doctor, you need to have a qualification. I don't believe that there is a, a, a reservoir of people out there who, who are waiting to be called up so that they can take part in covering for someone on strike. I think it's contrary to the European Convention of Human Rights, and I just think is that this is, is all smoke and mirrors. The minimum service levels, now I think this is, is, is an important one, because this was in the Conservative manifesto, right? The minimum service levels is important in that the government, to some extent, can get this through Parliament and through the House of Lords. But the question is, is, and I'm, you know, the question is, is it necessary? Because there is already legislation which says is, that if the industrial action is going to cause damage to property, or injury to life, then the union is required to make provisions in order to safeguard both the property, and not to damage life. And a classic example would be a refinery that I was involved with where basically we needed more time to shut down the refinery, because if we just switched it all off, it would never work again. So there already is legislation, and I just think as, again is that, they use the European example as being relevant, but the European example is all about, is health, like, protection of life and property. A teacher going on strike may damage people's prospects in the long term, but it is not going to basically injure those children immediately.
So I, I just think, again, this is, is, is a noise that is unnecessary, and as every one of these speakers has said, is simply a, a deflection from the failure of, of the current public sector pay negotiations. Just to allow questions, I think that I've, I'll stop there. I hope that I've galloped through that quickly enough. Katie.
KJ: Yeah. Thank you so much, and sorry, as I say, you drew the short straw going last. I'm just going to gallop through some questions for our, for our panel, and thank you, Melanie, for answering some in the background. So, if you want to go on and have a look at those answers, Melanie's been typing away. We've got a few questions about where you start if the relationship is very hostile. So if you're not starting from a place of partnership, if you feel that the, perhaps the union reps are, are pretty hostile, then where, what advice would you give on getting, getting started, Melanie?
MS: OK. Well, I think understanding the background as to how you got there. It's, it's not about it starting, is it? It, there's, it, it's always informed in these ongoing, open ended relationships, by what's happened previously. So really understanding how, how you've got here, why there's such a, like, lack of trust, what kinds of decisions or issues, or, its flare flash points, kind of, created that, etc, I think is, is, is, is the first step. And then I think there's a, a step of, what are you actually expecting from this relationship? Because it may be that that hostility is coming from too much expectation, or what's regarded as unreasonable expectation from the other side. I, I often, with students, try and encourage them to think about employment relations in a, sort of, marriage guidance, kind of way. And it's, there are often many analogies at the work. It, it's not a perfect analogy, but it's a pretty good starting point. The point at which you're walking into the therapist's office, it's all the 20 years before that that has to be taken into consideration before you can get to the point where there's actually a negotiated and agreed outcome of that particular moment of tension.
KJ: Brilliant, thank you. Rachel, do you want to come in on that?
RS: Yeah, thanks. Just quickly to bring in as well, that in that kind of situation, it could be helpful to think about organising some joint training. There was a question around training as well, and I think an approach years ago, I worked at ACAS, and they offer joint training for managers and reps together, and that was really helpful and beneficial, because it just helped to build that working relationship. So I think, you know, having somebody come in who's expert at facilitating that kind of collective relationship can, can, can really help. So yeah, I'd think about joint training.
KJ: Brilliant. And I think, kind of, going on from that, Michael, a specific question for you. You mentioned a lot about training and working with your line managers to make sure there's a really good understanding of the, the trade union relationship. So somebody's just asked for you to elaborate a little bit on that, and, kind of, the kind of resources you might point managers to, what that actually looks like.
MJ: Yeah. I mean, we, we're quite lucky, because we've got a big HR team on site. So we've got an employee relations team of about seven people that each have constituencies around site. So what we ask our employee relations controllers, as we call them, is to deliver some internal training on that. So they go around the supervisory group to make sure that they're, they're aware of the relationship, the, the dos and don'ts, how it works. So in terms of, yes, they get their standard employment law training, which helps with the, the day to day grind, for want of a better way of putting it. But in terms of that rep relationship management, we do that internally with our HR teams.
KJ: Brilliant. Got a question about the bill. What assurances do you think, if employees are getting anxious about, about the, the possibility of that, that coming in, what kind of messages do you think the employers should be giving out to the workforce at this, kind of, early stage? Vince, any thoughts on that?
VT: Yeah, I, I think the bill is very, very complicated, and it, you know, first of all, is the parties have to agree what the minimum service levels are going to be. Well, first of all, you have to agree are there minimum service levels required? Because that seems to me to be the fundamental issue here, is that, is, but then once you've had, got into it, but the unions will always want to have the minimum service level fairly low, because otherwise what's the point of the industrial action? And the management will always want business as usual, or potentially business as usual. And therefore you're going to get into this dispute via, via the CAC, not ACAS, which is the Central Arbitration Committee, as to whether or not the parties can agree. If the parties can't agree, then effectively, you're getting a panel to then impose what the minimum services level would be, taking into consideration what the management believes that the, that the minimum service levels are going to be. And you can see that this is going to create a significant degree of hostility, because it's just overcomplicated.
But I think, as we've already heard is, that it will, I think Rachel makes a good point here, what it will do is, is that it will actually create a situation in which people will look to get round the legislation by having barbecues in February, ie, no one is available to, to go to work. Or a, not an industrial action, but a work to rule. So if you have a work to rule which disrupts the, the minimum service level, then doesn't that suggest is that the contract is incorrect, because if the minimum, if your contractual obligations can't achieve the service that you're looking for, then there is something amiss. And the train driver strike is a classic example of this. The, the East, the, the train to Manchester, they used to run four, they run one an hour now. The reason they're only running one an hour is because people are not working overtime, because they're not required to. So they're not, wouldn't come under the minimum service level, because they're not taking part in industrial action, they're just complying with their contract.
So Katie, I just think is that it's, it is overcomplicated. I think that it, it will go through, because the, it was in the manifesto, so I don't think the House of Lords can veto it, but will it make any difference, and will it help? No, it will cause, and we have done a paper as a law firm, submitted it to the government, because they were asking for evidence, and we, and I can say this, we take the view is that this is a really unhelpful piece of legislation, overcomplicated, and will not solve the fundamental underlying issue, and that is the relationship between the employer and his employees, or her employees.
KS: Thank you. We are out of time. I'm going to ask a couple more questions, I'll just run over ever so slightly, if that's OK. So a question about working, I, I mentioned recognised trade unions. What about unrecognised trade unions, or those unions in sectors that perhaps are not as traditionally unionised, for example, Amazon? Melanie, anything on, on that?
MS: So the, the law is much more complicated, and I will leave it to, to Vince if, if we have time, to explain the ways in which the law is, is more complicated. Basically, it's very difficult for unions that don't have an established formal relationship with, with management to, to show that they're, they're in an, a dispute of, that would pass the, kind of, legal requirements that a union is required to do. It's not impossible, but what it does mean is we've seen, seen some unions use disputes and protests that are just short of strikes, but often get reported in the media of being strikes. So I'm thinking about some of the Deliveroo actions and things like that, have often been technically not strikes, but they've been collective protests, and then the media picks that up and talks about it as a strike. Which is useful for a lay audience, but doesn't technically pass the threshold of being a strike. I can't speak confidently to the Amazon status, because it's not a case study I know in detail.
KS: Brilliant, thank you. Rachel?
RS: Yeah, sorry, I know we're out of time, but I just wanted to add, not specifically talking about any company, but if there are requests for recognition by a trade union, then it's better to consider that and try to seek a voluntary agreement rather than have one imposed, because then a union can go through the Central Arbitration Committee. And I think, you know, we just need to shake off perceptions that are still out there that, you know, unions are a threat, we can't work with them. There is a real mutuality of interest between trade unions and employers. They want the business to succeed. They want jobs and good terms and conditions for their members. No, there is not always alignment of interest. There is conflict, it's inherent, but that conflict will be there anyway. So it's better to sit down. I know some organisations who have resisted trade union recognition for years and years, and the result has been recognition in the end, and a worsening of employment relations in that organisation. So I think we shouldn't see them as, as unions, as a threat.
KJ: Brilliant. And I'm just going to very quickly whip round all of you and ask for one very quick tip. And I'm going to say to the audience that we will take your questions away, and the ones we weren't able to answer, we will find a way to answer. So Vince, just one quick takeaway for everybody.
VT: Communication, communication, communication. And I think that Michael summed it up perfectly, is that in my experience having been a trade unionist, having worked for a trade union law firm, and having worked, is communication is vital, because if you don't fill the void, somebody else will.
KJ: Brilliant, thank you. Michael?
MJ: You've stolen mine, Vince. So I'll go with collaboration. Make sure you work together.
KJ: Brilliant. Mel?
MJ: Not against each other.
MS: The tip that I put in the answer comes from my experience as a line manager, and particularly a line manager during pandemic, even with 25 years of studying industrial relations, teaching industrial relations, the thing I had to keep remembering to do was to take a breath, to take a pause, to really make a decision about whether this decision made, needed to be made now, or whether there was space to have a quick conversation with the union rep, or with the wider team, particularly in that period of real crisis and change.
KJ: Brilliant. And finally, Rachel?
RS: Right, my keyword I want to put out there is partnership working. Partnership as a, sort of, model became, it was more popular, and then it became a bit discredited. It, you know, it, it's not used as much, but that is effectively what we mean, I think, when we're talking about the communication, the collaboration, the positive joint working, and so on. So I want to put it right back on the agenda for employment relations.
KJ: Thank you all. So apologies for overrunning. Apologies if we didn't get to your questions. But, as I said, we will find a way to answer them, in, in some kind of written format. My colleagues have been putting some useful resources in the chat. I'd like to thank Rachel, Melanie, Michael, and Vince for joining. I think that was really, really useful. Hopefully all of you found it useful as well. You can see it on the slide, just a quick reminder of our benefits, would flag the employment law helpline and the wellbeing helpline as being particularly useful in this space. But I'm sorry to eat into your lunch hour, if you're going to go and have to eat now, but thank you very much for tuning in, and we will see you soon. Bye for now.
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