UK: Employment Bulletin - January 1999

Last Updated: 4 January 1999
A fair way to go for the unions ?

In our May bulletin we outlined the legislation proposed by the Government in its much publicised Fairness at Work White Paper. The aim of the legislation is to bring the UK more into line with the rest of Europe and the key changes relate to individual rights, collective rights and 'family friendly' policies. Consultation on the White Paper ended on 31 July and since then the Government has been developing the policies in the White Paper to form legislative proposals.

Amid further publicity and controversy the Government has now published details of its Fairness at Work legislation which featured in the recent Queen's Speech. The expected strengthening of the unions through new recognition rules has been watered down (largely as a result of lobbying by the CBI) and certainly the initial fears in relation to union recognition have been calmed by the Government's proposals. Some of the key changes to union recognition rights are:-

The legislation proposes a trigger mechanism which requires a union to prove that it has 10 per cent membership in an agreed bargaining unit before an application for recognition can be accepted thus making the recognition process more complex and time-consuming.

Automatic recognition without the need for a ballot will no longer occur just because a union can demonstrate it has over 50 per cent membership. Instead a revitalised Central Arbitration Committee (CAC) will have sole discretion in deciding whether automatic recognition is acceptable and the Secretary of State will also be able to issue guidance to the CAC.

Proposals also involve protection from dismissal or action short of dismissal for employees involved in campaigning for recognition.

Restrictions are also to be placed on an employee's right to be accompanied by a union official in disciplinary cases. Whilst the White Paper proposed blanket representation rights at all levels of disciplinary and grievance procedures, representation is now to be limited to serious grievances which involve potential breaches of statutory, contractual or common law rights.

Employees taking part in official industrial action will now also be protected from unfair dismissal for the first eight weeks of the conflict but could face dismissal after eight weeks if the employer can show that it had taken all reasonable procedural steps to resolve the dispute. Under existing law, no one taking part in official industrial action can claim unfair dismissal provided everyone on strike is dismissed and none of them are selectively re-engaged within 3 months. The White Paper does not however propose change to the law where individuals are taking part in unofficial industrial action: they can still be selectively dismissed at will, without any claim against their employer.

The White Paper proposed to eliminate the cap on compensation for unfair dismissal but instead the Government's current legislative proposal is to raise the compensatory award limit from £12,000 to £50,000 and to index link that sum. The proposal is intended to offer a real incentive to employers to put in place proper voluntary systems to avoid unfair dismissals. This departure from the White Paper proposal was very much as a result of Peter Mandelson's intervention and it remains to be seen whether this will be changed by his successor.

It was anticipated in the White Paper that zero hours contracts would be outlawed but the Government has not included this in its legislative proposals so employers will still be able to put workers on call to work when needed.

Union reaction to the proposals is mixed but the TUC has already stated that it will continue to lobby for changes in relation to representation rights in grievance and disciplinary cases, recognition procedures and dismissals during industrial action.

It is anticipated that a Bill will be brought forward in the next couple of months. The Government has pledged a commitment to action all 29 proposals of the White Paper including a package of Family Friendly measures 'to ensure that as many people who want to work should have the chance to do so'.

Other changes in Employment legislation are also due to come into force in 1999. The National Minimum Wage Act 1998 is due to be implemented from April 1999 and introduces a minimum rate of £3.60 an hour for workers over 21 years of age. The new Data Protection Act delayed from October 1998 is also to be implemented early this year. The Queen's speech to Parliament on November 24 outlined the Bill to create a Disability Rights Commission which is a body to promote, enforce and monitor the Disability Discrimination Act 1995 in much the same way as the EOC and CRE operate in sex and race matters. The Bill has received its second reading in the House of Lords. The Human Rights Act 1998 received Royal Assent on 9 November 1998. Section 19 imposing a requirement that all new measures are compatible with the Convention came into force on 24 November 1998.


In Holland v Glendale Industries Ltd, the EAT held that an employee could not successfully pursue a constructive dismissal claim unless they had actually informed their employer before they left that they were going because of their employer's repudiatory breach of contract which they accepted as bringing their contract of employment to an end. (Clearly this is the sort of thing that "trips off the tongue" of your average employee). The EAT decided that the employee's constructive dismissal claim would fail if they left it until after their employment had ended to tell the employer the real reason that they had left. The Court of Appeal has now ruled in Weathersfield Ltd v Sargent that the EAT got the law wrong and there is no such requirement. What matters is what the real reason was that the employee left - not what they told their employer at the time. The Court of Appeal therefore recognised that in many cases an employee may not want to confront their employer with their true feelings whilst they are still on the premises!

For further information please contact Susan Nickson, e-mail: Click Contact Link , Trinity Court, 16 John Dalton Street, Manchester M60 8HS, UK, Tel: +44 161 830 5000

This article was first published as the January 1999 Hammond Suddards Employment Bulletin

The information and opinions contained in this article are provided by Hammond Suddards. They should not be applied to any particular set of facts without appropriate legal or other professional advice.

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