By: Chew Khai Xing
The ‘winter of discontent’ - aptly used to describe the period of widespread strikes during the 1978-79 winter in the UK - is back. And the chill felt by the UK economy and businesses does not appear to subside anytime soon.
As 2022 ended in a series of labour strikes and industrial disputes in various industries of the UK economy - most notably the largest NHS action in history and the biggest walkout of ambulance staff in 3 decades - there seems to be no near end in sight. Tens of thousands of workers are expected to strike in the coming months for better working conditions and pay increases that would keep pace with the rising inflation. These labour strikes have undeniably left a negative impact on businesses in various sectors - with the ONS reporting that one in eight businesses had been affected by industrial action while the mass walkouts were estimated to have cost the London economy alone almost £2 billion in lost sales over the festive period. In light of these business woes, the new UK anti-strike bill - the Strikes (Minimum Service Levels) Bill - might seem to be the light at the end of this long tunnel. However, if the overwhelmingly negative reactions to the bill - and to the UK government’s unwillingness to compromise - are anything to go by, this light is merely a false glimmer of hope.
Leading up to the end of 2022, the negative impact on businesses - ranging from large corporations to SMEs - has been substantial. Royal Mail has taken a £200m hit from strikes [1] amidst ongoing disputes with postal workers and staff walkouts whereby the financial blow is expected to increase beyond £450m if the strikes continue. The adverse effect of postal services’ strikes on SMEs is not to be understated as well - SME owners have expressed worrying concerns over how disruptions in delivery services are ‘crippling’ as the widespread delays to the shipping of items to their customers affect consumer confidence and satisfaction [2]. Meanwhile, rail strikes have cost Britain’s F&B and hospitality sector £1.5bn [3] in lost business in December alone, a negative outlook expected to turn gloomier. Kate Nicholls, chief executive of UKHospitality, predicted that the wave of cancellations of events, along with high energy bills and the wider cost of living, formed a ‘perfect storm’ that would ‘undoubtedly’ cause more business failures in the upcoming months. Indeed, there have already been about 2,500 closures of hospitality premises in the past three months after the usually busy December holiday period turned quieter than usual due to the transportation difficulties from railway strikes.
These railway strikes, coupled with teachers’ strikes, have also created disruptions in the workplace as workers struggle to travel to the office while parents are forced to stay at home to look after their children [4] (though businesses that have adopted hybrid or remote home working arrangements will not feel as big of an impact). Meanwhile, strikes in critical services such as ambulances pose another challenge to employers in inherently more dangerous industries. The increased risk of not receiving timely treatment will likely result in a rise in claims by employees relating to avoiding serious and imminent danger in the workplace under the Employment Rights Act which provides that all employees have a statutory right not to be subjected to any detriment or to be dismissed for refusing to come to work in circumstances where the employee has a reasonable belief that they or others are in “serious and imminent danger” [5]. However, the recent Court of Appeal decision in Rodgers v Leeds Laser Cutting Ltd [6] should offer some relief to worried employers as the case established a high threshold of ‘danger’ that is unlikely to be met by the risk of ambulance delays.
Amidst rising frustration over the prolonged strikes, Business Secretary Grant Shapps introduced the Strikes (Minimum Service Level) Bill [7] which will give the government the power to ensure that vital public services maintain a basic function by delivering minimum safety levels ensuring that lives and livelihoods are not lost. Under the bill, while the government expects parties in the sectors included in the bill to ‘reach a sensible and voluntary agreement between each other on delivering a reasonable level of service’ when there is strike action, the government holds the power to step in and set minimum service levels should the government deem it necessary. In the event of non-compliance with the obligations set out in the bill, the union will lose its legal protection from damages. The introduction of the bill has received overwhelmingly negative reactions, with UNISON General Secretary Christina McAnea criticising the government for ‘attacking workers and making it even harder for them to win fair pay’ when they should be focusing on ‘fixing the pay crisis and solving the legitimate disputes that have led to the recent strike action’ [8]. A deeper reading of the Bill highlights the aforementioned curtailment of workers’ rights. For example, the provision granting the government powers to set ‘minimum service levels’ without a specified limit to these ‘service levels’ enables the government to potentially force workers who have democratically and legally voted for strike action to go to work on strike days against their will. Furthermore, employers are empowered with a new strike-breaking tool in the form of work notices whereby the employer would have a right to serve the union with a ‘work notice’ specifying the number of people required to work and the work to be performed during the strike to meet the ‘minimum service level’ imposed by the government. Without sufficient time to coordinate between the union members, the union is then obliged to take ‘reasonable steps’ to ensure all union members comply with the notice or risk being sued by the employer. Moreover, the bill has removed the workers’ protections under the 1992 Trade Union and Labour Relations (Consolidation) Act [9] which ensures that employers cannot penalise workers taking industrial action - by providing that employers can dismiss workers who fail to comply with a work notice. This has significantly threatened workers’ right to withdraw labour - which is arguably their most powerful tool in fighting for better employment conditions, thereby infringing on human rights and international labour standards. Indeed, British union leaders have condemned the bill as ‘reprehensible’ and ‘an attack on human rights’ as it punishes workers for merely demanding decent pay and working conditions [10]. Such criticisms have been echoed by nine of Western Europe’s biggest trade union confederations who signed a joint statement warning that the aforementioned restrictions on the right to strike will ‘put the UK even further outside the democratic mainstream’ and ‘aggravate and prolong disputes’ [11].
However, the chilling effect on workers’ rights might be overstated. Even if the bill is passed in its current form (despite likely opposition in the House of Lords), the provisions allowing the government to set ‘minimum service levels’ will almost certainly be challenged through judicial review by unions (who have already threatened legal action) in light of their potential incompatibility with the ECHR. As Mick Lynch, general secretary of the RMT rail union put it, the bill is ‘an attack on human rights and civil liberties which we will oppose in the courts, parliament and the workplace’ [12]. Thus, it seems unlikely that the bill will be passed.
At this stage, the introduction of the bill has only escalated tensions and ill-will between the unions and the government, with the Trades Union Congress stating that it removed ‘any pretence at collective negotiation’ [13] as it reinforced the impression that the government was not acting in good faith in talks to resolve the current pay disputes. Since the bill is unlikely to be passed anytime soon (if at all), it does not provide any relief or confidence to businesses that are reeling from the impact of the prolonged strikes. Thus, forecasts of strikes continuing for the next few months are likely to be accurate until either the current impasse is overcome or the cost of living crisis recedes.
Even if, against the odds, the bill is passed, the bill might worsen labour disputes and business disruptions instead of mitigating them. Practically, the ‘minimum service levels’ requirement is going to be challenging to implement since employers and unions will have to go through a complicated and contentious process of agreeing on the workers and hours needed to keep services going [14]. And while the government has the power to step in, there are doubts that government officials are too detached from and unfamiliar with these industrial operations to be able to do so effectively. Thus, disputes may end up becoming more prolonged and disruptive, thereby exerting a greater toll on businesses and the economy. Furthermore, it has been submitted that the bill ‘takes no account of the realities of talent attraction, engagement and retention’ [15] in the public sectors which are already struggling with recruitment and replacements in the first place. It is unlikely that employers can use the threat of dismissal provided in the bill to compel employees to return to work when employees know that they are irreplaceable.
Overall, even though spring is around the corner, it seems that this winter of discontent is here to stay for the foreseeable future. One can only hope that real, constructive dialogue and cooperation will happen sooner rather than later. If recent developments such as the UK university strikes being paused for two weeks [16] are anything to go by, there might be cause for optimism after all.
References
[1] Telling, O. (2023, January 26). Royal Mail takes £200mn hit from postal strikes. Retrieved February 21, 2023, from https://www.ft.com/content/8c68dc3d-c28b-48ca-92b9-6c0b6b907fdd
[2] Dates of all strike action in the UK – how will this affect smes? Moblox. (n.d.). Retrieved February 21, 2023, from https://moblox.com/content/articles/dates-of-all-strike-action-in-the-uk-how-will-this-affect-smes
[3] Pickard, J. (2022, December 30). Rail strikes caused £1.5bn hit to hospitality sector in December, says trade body. Retrieved February 21, 2023, from https://www.ft.com/content/dc3bf266-3f55-4728-8d82-b32e1c1fe2c5
[4] The ripple effect: How strikes are affecting the wider world of work. Lewis Silkin. (n.d.). Retrieved February 21, 2023, from https://www.lewissilkin.com/en/insights/the-ripple-effect-how-strikes-are-affecting-the-wider-world-of-work
[5] The ripple effect: How strikes are affecting the wider world of work. Lewis Silkin. (n.d.). Retrieved February 21, 2023, from https://www.lewissilkin.com/en/insights/the-ripple-effect-how-strikes-are-affecting-the-wider-world-of-work
[6] Rodgers v Leeds Laser Cutting Ltd (Employment Appeal Tribunal May 6, 2022).
[7] Department for Business, E. & I. S. (2023, January 10). Government introduces laws to mitigate the disruption of strikes on the public. GOV.UK. Retrieved February 21, 2023, from https://www.gov.uk/government/news/government-introduces-laws-to-mitigate-the-disruption-of-strikes-on-the-public
[8] Starling, J. (2023, January 17). Three things you need to know about the anti-strike Bill: Article: News. UNISON National. Retrieved February 21, 2023, from https://www.unison.org.uk/news/article/2023/01/three-things-you-need-to-know-about-the-anti-strike-bill/
[9] Participation, E. (1992, July 16). Trade Union and Labour Relations (Consolidation) Act 1992. Legislation.gov.uk. Retrieved February 21, 2023, from https://www.legislation.gov.uk/ukpga/1992/52/contents
[10] Pickard, J. (2023, January 10). UK union leaders criticise strikes Bill as 'reprehensible'. Retrieved February 21, 2023, from https://www.ft.com/content/f1951d3a-ec3d-4570-8fad-07ad570330fb
[11] Independent Digital News and Media. (2023, February 18). UK's anti-strike Bill violates Democratic norms, European Trade Unions Warn. The Independent. Retrieved February 21, 2023, from https://www.independent.co.uk/news/uk/politics/strikes-bill-minimum-services-level-eu-trade-unions-b2284532.html
[12] RMT response to the anti-strike Bill. RMT. (n.d.). Retrieved February 21, 2023, from https://www.rmt.org.uk/news/rmt-response-to-the-anti-strike-bill/
[13] Strauss, D., & Parker, G. (2023, January 13). Anti-strikes legislation is 'unworkable', Say Trade Unions. Financial Times. Retrieved February 21, 2023, from https://www.ft.com/content/6a5b5c02-3be3-4202-a67e-2ae0b107abc7
[14] Cook, J. (2023, January 9). How would businesses be impacted by the proposed anti-strike laws? - business leader news. Business Leader. Retrieved February 21, 2023, from https://www.businessleader.co.uk/how-would-businesses-be-impacted-by-proposed-anti-strike-laws/
[15] Cook, J. (2023, January 9). How would businesses be impacted by the proposed anti-strike laws? - business leader news. Business Leader. Retrieved February 21, 2023, from https://www.businessleader.co.uk/how-would-businesses-be-impacted-by-proposed-anti-strike-laws/
[16] Staton, B. (2023, February 17). UK university strikes called off as talks near deal. Financial Times. Retrieved February 21, 2023, from https://www.ft.com/content/0ccc6a83-fb01-45b7-b57a-28b2cdccca39
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