UK: Trade Unions And The Credit Crunch

Last Updated: 15 October 2009
Article by Clare Thomas and Gagandeep Prasad

The problem

The recent strike by London's tube workers raised questions about what amounts to lawful strike action. Despite progress with negotiations, the strike reportedly went ahead because London Underground refused a last minute request to reinstate two employees previously dismissed for disciplinary issues. As well as practically bringing London to a standstill, this development emphasised that the possibility of strikes or other industrial action is not rare in the current climate. Potential ballots on industrial action are being threatened in response to the recent plans by BA to reduce costs by cutting jobs and freezing pay. As industrial action clearly continues to be a potential threat to businesses exploring cost-cutting options, employers need to be alert to the issue. This is a complex area and it is key to seek advice as soon as possible to be able to respond effectively and correctly.

In some industries, such as the catering industry, whilst unions may not be officially recognised they will still play a role in terms of accompanying employees who are union members to disciplinary hearings or grievance meetings.

The law

An employer needs to consider its legal position in respect of both the union and the employees. The rules for each are, in the main, distinct: the fact that a union is protected from legal action for organising a strike does not necessarily mean that participants in that strike cannot be dismissed or have their pay stopped.

Where a union has called a strike following a successful ballot of its members, unfair dismissal protection extends not only to members of the union, but to all employees who participate in the action despite the fact that the non-union members do not have an entitlement to vote in the ballot.

Industrial action is either official, unofficial or protected.

  • "Official" action – where the individuals are members of a union which has endorsed the action.
  • "Protected" action – where the union has properly conducted a secret ballot and the action is in response to a valid trade dispute.
  • "Unofficial" action - any other industrial action.

Consequently, a strike in which none of the participants are union members cannot be "protected," although it will always be treated as "official"; that is, from the employees' point of view, it will be treated as if it had been called by a union but without a ballot.

The significance of the categorisation is that employees who are dismissed while taking part in unofficial industrial action cannot normally claim unfair dismissal. If employees are taking part in official industrial action they cannot normally claim unfair dismissal if the employer dismisses all of them, but can make such a claim if the employer selectively dismisses or selectively offers re-engagement, or if the industrial action is "protected"

Expert advice

This is a potentially tricky area of the law and it is crucial to take advice as to the validity of the action being taken and what exactly an employer can do. Often there are disputes about whether action is authorised by the relevant union(s) and this can be one way for employers to challenge the action. In other cases, there are disputes about whether the very technical balloting rules have been complied with.

Practically speaking, to seek to avoid the disruption that industrial action will mean, employers are advised to consider involving ACAS to assist in negotiations when facing the prospect of industrial action. ACAS is an independent public body which can act as a conciliator to assist with resolving a range of trade disputes.

Often employers seek to end the disruption by dismissing participants in such industrial action. Employers should take advice before doing so as the distinction between the different types of industrial action will determines the extent to which the employer is protected against unfair dismissal claims. Unfair dismissal claims are currently capped at just over £70,000 so a failure to appreciate the protection that employees may have could be costly.

Even for those employers who do not formally recognise any unions, union officials may still attend disciplinary or grievance meetings as a companion to an employee who is an union member. In addition, the ACAS Code does specifically warn employers to exercise caution if they are disciplining a union representative as the action may be seen as an attack on the union. Employers are advised to discuss the case with a full-time union official after obtaining the employee's agreement.

To do checklist

  • Consider whether the dispute can be resolved before industrial action occurs.
  • Establish the type of industrial action that is being taken, i.e. official, unofficial, protected.
  • Take advice as to whether the action is authorised and potential ways to challenge it.
  • Determine what is required in order to meet the demands of the business and to bring an end to the action.


Dismissal for participation in industrial action is technically a misconduct dismissal and as such the ACAS Code would apply. This could potentially mean an uplift of an additional 25% of compensation for failure to follow the Code so employers should be mindful of the Code in such situations.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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Gagandeep Prasad
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