Dealing with trade unions

With the headlines full of strikes, how can HR handle industrial relations without sparking confrontation?

On this page:
Bargaining time
Stay firm
Union networks
Caught in the middle
Our expert
Legal dos and don'ts

Public sector employees, tanker drivers, rail and Argos workers have all hit the headlines recently by taking – or threatening to take – strike action in support of pay claims. HR professionals in the UK are likely to encounter ever-more aggressive unions in the next two years, and that may come as a shock to some – particularly those who have not faced it before.

Union membership in the UK is in decline, albeit gradual. The last survey from the Office of National Statistics put membership at 25.8% of the working population at the end of 2006. Union density in the private sector is only 16.6%, which contrasts heavily with the public sector at 58%. More women than men are union members and the older you are, the more likely you are to be a member of a union, with more than one-third of the over-35 workforce in membership.

This trend does give unions a problem. As the workforce ages, it follows that membership will fall, unless they find a way to recruit younger people. That will be difficult, as unions have always struggled to make themselves attractive to ‘Thatcher’s children’, particularly those in the private sector.

A further challenge is the outsourcing of public sector functions to the private sector. If that trend continues, the number of public sector workers will shrink. Unions have also found it difficult to recruit migrant workers in low-paid jobs, although given the numbers of these groups in the UK, it must be a priority for them.

Bargaining time

So, you are in HR and you have traditionally bargained with the union on pay and terms and conditions. Mostly, negotiations have gone well, but this year the demand is for a rise in line with retail price index (RPI) inflation, plus 2% for everyone, and the union representatives have told you they will not settle for less. The union has issued communications throughout the organisation promising it will deliver and this is the year to make a stand. However, the board has said that the company will not settle for anything like RPI, and you have to conduct negotiations, and get a settlement, on this basis. What do you do?

Stay firm

The most important rule is to never take anything personally. This goes for communications from the union, statements from its reps, anything that you may consider to be underhand. If you take it personally, which may be what they want, then there is no way back.

Also remember that it is almost impossible to make any impact on a union’s political agenda, so don’t try. If there is a national union campaign on pay or another topic running, and you happen to be one of a number of companies caught up in it, there will be little you can do to influence any different thinking. A good example here is the rail unions. They have a policy to try to get the railways back into public ownership. The HR director or managing director of a rail franchise company has no influence on the re-nationalisation of the railway, but that will not stop the unions bringing that argument to the bargaining table with individual demands.

Union networks

Unions are very good at swapping and comparing information about things such as pay. Their reps will know what is happening within other organisations and what pay claims are being made.

They may also make a resolution at a conference to stick together on particular issues so a union operating in two different insurance companies will know exactly what the reps in each are asking for and will settle for. Therefore, if you are part of a larger group or organisation, or have a network of colleagues in other organisations who you can talk to and compare with, you should do it. Maybe even consider making an agreement about your pay offer and where you will settle. It is much easier for organisations that are not isolated to make a stand.

Before you begin negotiations or discussions, make sure you have a clear strategy in place for how negotiations will go and be absolutely clear that the board and other senior colleagues are committed to that strategy. I have been in the situation of being told to tell the union that we are making a final offer and that they can take it or leave it, and later caving in at the first hint of a strike ballot. It is undermining and damaging. If you are going to talk tough, then be tough and see it through, otherwise, union reps will never believe you.

Don’t leave it to the union to communicate with the workforce. It is common to find managements that do not try to engage directly with their people or even communicate on a basic level, as they are told the union will not like it. This is a fundamental error. The time to build engagement and talk to employees is when things are going well. Then, if the situation changes and a conflict with the union arises, the battle for hearts and minds will not be so difficult to win. However, that battle is impossible if you approach it from a cold start.

Above all, be sure of your position, fully work out your argument, and be prepared to stand your ground without generating conflict. Negotiating with a union need not be something to worry about.

Are we really seeing a red mist descend upon the UK workforce, or is this a case of a few unions trying to flex their muscles? One thing is for sure: the economic climate has as much to do with the current round of disputes as anything.

Caught in the middle

The chancellor has asked for pay increases to be kept low at a time when RPI is rising. Most unions will fight against settling a pay claim at below RPI, as they will argue that to do so will mean a reduction of their members’ pay in real terms. This approach will automatically put them at odds with the government, leaving employers caught in the middle.

All the time we are in a downturn with everyone feeling the impact of increasing costs, unions will look to employers to foot the bill. The key will be the appetite among their members to support the fight. If unions insist on holding the private sector to ransom on pay, then employers may offset the cost with further job losses, and so the cycle will continue until we see economic recovery.

If the union is playing to a wider political agenda, it will not always be possible to reach a compromise, and it is unrealistic to always expect one. But this scenario should form part of the negotiating strategy and be factored in to the plan.

The opportunity for HR professionals to get experience in employee relations is now excellent. One of the issues with the shared service model adopted by many employers is that it is difficult for HR people to get specialist experience in areas such as employee relations. Shared services have narrowed the generalist job right down into being a business partner, resulting in skills shortages in key areas. A generalist would probably have a great opportunity to broaden their employee relations skills right now, but sadly, many will not get the chance.

Our expert

Andy Cook has more than 10 years’ experience in senior HR positions, working in both the private and public sectors. He has worked at board-level in large, complex organisations and has led major change and restructuring programmes. Cook worked as a union officer before starting his career in HR, which has included roles as HR director at the British Library, head of HR and employee relations with Transport for London, and as HR director, UK and Ireland, at Gate Gourmet. Cook is now managing director of Marshall-James, (external site) an HR consultancy that specialises in HR strategy, focusing particularly on employee engagement and employee and industrial relations.

Legal dos and don’ts

Do

  • Retain a lawyer experienced in employee relations and industrial action law. Most employment lawyers have no relevant experience, even in the big firms.

  • Remember that you can inadvertently recognise a union by conduct.

  • Define carefully the extent of any recognition granted and of ancillary rights, such as to time off work for reps.

  • Remember that although collective agreements are not usually contractually enforceable by the union, parts of them can become enforceable by employees.

  • Allow the union to use ‘check-off’ (members pay their subs through payroll), which gives you information on its membership – invaluable when challenging industrial action.

  • Challenge robustly any industrial action – even if you don’t go to court, a challenge may help to stop future action if the mistakes are repeated.

  • Remember that any legal challenge to industrial action can only buy you time, not a resolution.

Don’t

  • Forget that recognising a union for collective bargaining means that all employees in the relevant grades, whether or not they are union members, are bound by the collective bargaining process.

  • Offer incentives to staff to contract out of collective bargaining – this is illegal.

  • Wait until the union has applied to the Central Arbitration Committee for recognition before negotiating – as if you then recognise, it will be for a minimum period of three years.

  • Give the union the personal details of your staff – this would breach the Data Protection Act.

  • Derecognise without thinking through the implications, such as for the check off arrangements, or time off for union reps.

  • Be afraid to take technical points when challenging industrial action; a misplaced word or a missing number may be enough to get an injunction.

  • Delay too long before challenging industrial action, as this can prejudice your legal position.

Source: Marc Meryon is a partner at Bircham Dyson Bell in London, specialising in employee and industrial relations.