An employer's guide to trade unions and industrial action

Industrial action is something that all employers will wish to avoid if at all possible. The consequences to a business can range from inconvenience to extreme disruption with serious financial impact. In this guide we will describe the various types of industrial action that can used by employees; the legal framework defining lawful and unlawful industrial action; and the practical steps that employers can take in responding to such action.

Types of industrial action

There can be many different forms of industrial action but the defining characteristic is collective action taken by some or all of the workforce to bring pressure on employers in the course of a dispute between employers and employees. Typically this will relate to the employees terms and conditions of employment, but might relate to wider collective issues.

Common types of industrial action include:

• Strikes;
• Overtime bans;
• Go slows: where the employees deliberately reduce their productivity;
• Working to rule: when employees do no more than the absolute minimum required in their contract of employment;
• Blocking: the practice of refusing to work with a particular customer or supplier; or a refusal to work on a particular machine or process;
• Picketing;
• Secondary action: this is where workers not in dispute with their own employers take action in support of another group of workers. This is sometimes called sympathy or solidarity action. This type of action has no protection and is now very rare.

There is one form of industrial action that can be brought by employers; the 'lock-out'. An employer may close a workplace or suspend employees from work in furtherance of a dispute. This is rarely done not least because the employer is likely to remain liable for the employees' wages.

The legal framework

Any strike necessarily involves a breach of contract by the employees and has the potential to prevent the employer from fulfilling its obligations to its customers and suppliers. A complex web of law has developed over the last 130 years protecting employees and unions from the potential legal consequences of their action, and to protect the employer from being subject to industrial action without certain procedures being followed by unions first.

When does a breach of contract occur?

This is obvious when the industrial action involves a strike or overtime ban, but does a 'work to rule' involve a breach of contract? On the face of it a 'work to rule' action involves a rigid adherence to contractual terms. However, even this has been considered to be a breach of contract. In The Secretary of State v Aslef (1972) the railway union applied a work to rule in relation to rest day working. Without co-operation from employees on the rest day working arrangements the railway was effectively paralysed. The Court of Appeal ruled that there was an implied term in contracts of employment that employees would not operate a contract’s terms with the intention and result of frustrating their employers business.

In addition to there being a breach of contract by the employee any union calling for industrial action will commit a tort (a civil claim) of 'inducing a breach of contract'.

Despite the provisions of the EU Charter of Fundamental Rights and the European Convention of Human Rights, which guarantee the right to join a trade union and to participate in industrial action, there is no UK law giving the right to take part in industrial action. However, there is legislation protecting employees and trade unions from the consequences of taking industrial action if this has been entered into in compliance with the appropriate legal framework.

This protection does not mean that the industrial action is no longer a breach of contract but it prevents an employer from suing the trade union for damages caused by the action and restrictions are placed on the employer’s ability to dismiss employees taking part in the action.

'No industrial action' clauses

A collective agreement between an employer and a trade union may include a provision that prevents or restricts the trade union from calling industrial action.

There is a binding presumption that this type of clause will not be enforceable against a union unless it is in writing and contains a provision that it is intended to be enforceable (s.179 Trade Union and Labour Relations (Consolidation) Act 1992.)

The agreement is not binding on individual employees unless:

• the trade union is independent;
• the agreement is in writing;
• the agreement is reasonably accessible to workers at their place of work and during reasonable working hours;
• the agreement states that the agreement will or may be incorporated into the employees contract of employment; and
• the worker’s contract expressly or impliedly incorporates the agreement.

Even if all these conditions are complied with, there is a question mark over the enforceability of such clauses as all industrial action involves a breach of contract.

Official and unofficial industrial action

An employee is taking part in official industrial action if:

• he is a member of a trade union and the union endorses or authorises the industrial action;
• he is not a member of a trade union but others who are taking part are members of a union that has authorised or endorsed the industrial action; or
• none of those taking part in the industrial action are trade union members.

Where more than one union is involved in the industrial action and the employee who takes part in the action is a member of a union that has not endorsed the action he will be taking part in unofficial industrial action.

Employees taking part in unofficial industrial action and who are dismissed because of this cannot bring a claim for unfair dismissal. Employees taking part in official industrial action can claim that they have been unfairly dismissed if the action has been protected by a properly constituted ballot.

Dismissal during unofficial action

Assuming that the dismissal does not fall into the category of automatically unfair dismissals, the employer will be immune from unfair dismissal claims if it can show that the employee was taking part in unofficial industrial action at the time of the dismissal. The time of the dismissal means:

• if notice is given, the date it takes effect;
• if no notice is given the date the termination takes effect; or
• the date a fixed term contract ends without being renewed.

An employer can be selective in who he chooses to dismiss during unofficial industrial action and may be tempted to use this as a mechanism for getting rid of 'ring leaders'. However any employer should consider carefully the potential consequences of dismissing individual employees in these circumstances because of the potential adverse impact on industrial relations generally.

Any industrial action backed by a union steward will be considered to be official unless repudiated by the union. No dismissal should be made until the union has repudiated the industrial action. Even then the action will only become unofficial after the end of the next working day after the repudiation is made by the union. Saturdays, Sundays, Christmas Day, Good Friday and other bank holidays do not count as working days even if a particular employer works on those days LETTER TO TRADE UNION TO REPUDIATE UNOFFICAL INDUSTRIAL ACTION.

Dismissal during protected official industrial action v unprotected industrial action

Protected industrial action is industrial action that has been lawfully organised by a trade union. It must relate to a valid trade dispute; the union must have balloted properly and fulfilled its obligations in relation to notification.

Employees taking part in protected industrial action can bring a claim for unfair dismissal if the termination of employment takes place during a protected period of 12 weeks beginning with the first day the employee participated in the industrial action. Any period where an employer institutes a 'lock-out' will not count towards the 12 week period. A dismissal during the protected period will be automatically unfair if the dismissal:

• is during the protected period;
• is after the protected period and the employee did not take part in industrial action after the end of the protected period;
• is after the end of the protected period and the employee has continued to take part in industrial action but the employer has failed to take such procedural steps as would have been reasonable to resolve the dispute.

In practice this means that an employee has the right to take part in an industrial dispute for 12 weeks without fear of dismissal and for a longer period if the employer has not taken reasonable steps to resolve the dispute. Reasonable steps would include:

• following established dispute resolution procedures;
• offering to continue or reconvene negotiations after industrial action has started;
• seeking conciliation or mediation;
• Co-operating fully during conciliation or mediation.

Dismissals during official action, whether protected or not, cannot be selective and must involve all employees involved in the dispute. If re-engagement is offered to some, but not all employees after the dismissal, this will likely result in a finding that the dismissal is unfair.

Trade Union liability

Trade unions are potentially liable for the losses (damages) caused by industrial action that they have organised. Liability would primarily be as a result of a civil claim for inducing the employees to breach their contracts of employment. However, as long ago as the 19th century the law recognised that trade unions should be able to organise industrial action without the fear of being sued by the employer with whom they are in dispute.

To be protected from this type of liability the union must comply with the provisions of the Trade Union and Labour Relations (Consolidation) Act 1992 when organising industrial action in order for it to become protected industrial action.

A union can be held legally responsible for industrial action only if it has authorised or endorsed the action. This means the industrial action must be approved by an official of the union who has power to do so under the union rules; for example by shop stewards as well as full time officials of the union. The union can authorise industrial action either by formal written approval or by informal means.

Therefore, if a union official has instigated industrial action (i.e., technically approved it) but the union does not wish to condone this, it has the opportunity to repudiate the action. This must be in writing and the union must attempt to contact all of its members taking part in the action to inform them that the action has been repudiated. The notice must be sent to each member individually and must contain the phrase:

“Your union has repudiated the call (or calls) for industrial action to which this notice relates and will give no support to unofficial action taken in response to it (or them). If you are dismissed while taking unofficial industrial action you will have no right to complain of unfair dismissal.”

Repudiation in these terms will not be effective if the union acts in a way inconsistent with the repudiation.

Protected industrial action

To be protected the industrial action must be:

• in contemplation or furtherance of a trade dispute;
• taken after a ballot has been held involving all members who will be involved in the industrial action.

A dispute is a 'trade dispute' only if it involves issues such as terms and conditions, disciplinary issues, provision of facilities to trade union officials, the physical working conditions of a worker and allocation of work. It does not include action:

• taken for political purposes;
• to enforce a 'closed shop' (i.e. to require the employer to employ only union members);
• to force the employer to do business only with customers and suppliers that recognise trade unions; or
• to force the employer to require its customers to employ only trade union members.

Industrial action as part of a dispute relating to the recognition of a union at the employees' own workplace may be protected.

Ballots

For industrial action to be protected it must be pursuant to a ballot of the union members who are to take part in the industrial action. The rules relating to balloting and timescales relating to taking action after the ballot are complicated. They are found in the legislation and the Code of Practice: Industrial Action Ballots and Notice to Employers which is issued by the Department for Business Innovation and Skills.

Procedural requirements

1. The union must give the employer not less than seven days notification of the ballot.
2. A copy of the voting paper must be sent to the employer not less than three days before the ballot.
3. The ballot must conform with the provisions relating to ballots (see below). If more than 50 union members are involved in the ballot an independent scrutineer must be appointed by the union to oversee the ballot.
4. The independent scrutineer must issue a report on the conduct of the ballot within four weeks of the ballot taking place.
5. All those entitled to vote must be allowed to vote in the ballot.
6. The union must take reasonable steps to announce the results of the ballot to its members and their employers as soon as is reasonably practicable. This must include the number of votes cast, the number of ‘Yes’ votes and the number of ‘No’ votes and the number of ‘spoiled’ papers. Following changes introduced on 1 March 2017 The Union is also required to provide the following additional information:  the total number of workers entitled to vote; whether at least 50% of them voted; whether the majority of those entitled to vote work in “important public services” whether 40% of those entitled to vote voted in favour of the action.
7. Notice of industrial action must be served on the employer at least 14 days before the action is to start (unless the employer and union agree to a lesser period of 7 days).
8. If industrial action is to be discontinuous the notice must set out all of the intended dates when the employees will take part in the industrial action. This may be done in one notice relating to several discrete days of industrial action.
9. Industrial action must commence within six months of the closing date of the ballot. This may be extended to up to nine months by agreement between the union and the employer.
10. A ballot cannot retrospectively validate industrial action which started prior to the ballot taking place.

With regard to the conduct of the ballot there are strict procedural requirements:

1. There must be a secret and postal ballot and there must be arrangements for the ballot to be accurately and fairly counted.
2. All union members who are expected to participate in the industrial action must have the opportunity to take part in the ballot.
3. Where more than 50 union members are to take part in the ballot an independent scrutineer must be appointed by the union to administer the ballot.
4. Union members must be able to take part in the ballot without cost to themselves and without 'interference' from the union or its officers.
5. An accidental miscount can be ignored if it is so small that it would not affect the outcome of the ballot.

In Royal Mail Group Ltd v Communication Workers Union [2019], the Union encouraged workers to intercept delivery of ballot papers at the Royal Mail delivery office where they worked. The Court of Appeal held that this amounted to 'interference' as Parliament clearly intended workers to be able to vote in private. 

If the ballot is to take place across a number of different sites there should be separate ballots at each site unless;

• Members of the same union at each site are directly affected by the outcome of the dispute;
• Entitlement to vote is given to all union members across the sites who the union believes have a common occupation or occupations and are employed by the employer or employers involved in the dispute (but no others); or
• Entitlement to vote is given to all members of the union who are employed by the employer or employers with whom the employer is in dispute (but no others).

There are occasions where workers who were not balloted take part in the industrial action. If they were not entitled to vote at the time of the ballot this will not affect the protected nature of the industrial action. The most common examples of this are:

• Workers who are not members of the union.
• Workers who joined the union after the date of the ballot.
• A worker who changed jobs after the ballot and transferred into a group affected by the dispute.

It is fundamental to the balloting process that only employees who are likely to take part in the industrial action can vote. The onus is on the union to ensure that this is the case. In British Airways PLC v UNITE the Union [2009], the High Court concluded that the union had failed to take reasonable steps to identify members who were to take voluntary redundancy before the strike and to exclude them from the ballot.

Content of the ballot paper

The ballot paper must contain the following

1. One or both of the following questions:

• Are you prepared to take part in or continue to take part in strike action?
• Are you prepared to take part in or to continue to take part in industrial action short of a strike? (The precise wording is not stipulated as long as the question requires a yes or no answer).

2. This statement:

“If you take part in a strike or other industrial action, you may be in breach of your contract of employment. However, if you are dismissed for taking part in strike or other industrial action which is called officially and is otherwise lawful, the dismissal will be unfair if it takes place fewer than twelve weeks after you started taking part in the action and depending on the circumstances it will be unfair if it takes place later.”

3. The address to which the ballot paper must be returned.

4. The date by which the ballot paper must be returned.

5. The person or persons authorised to call for industrial action if the vote is in favour of industrial action.

6. The number of the paper.

7. If an independent scrutineer has been appointed, the name of the scrutineer.

Following changes introduced on 1 March 2017 the ballot paper must also state:

• A summary of the matters in issue
• The type of action envisaged, where action other than strike action is proposed
• The periods within which action is expected to take place

Previously it was sufficient that a 'simple majority' of votes cast were in favour of industrial action.

However this changed from 1 March 2017, following the implementation of Trade Union Act 2016. Now, at least 50% of those eligible to vote must vote. Note that this is a 'turnout' requirement which sets a minimum level of participation in the ballot. Beyond the turnout requirement, a 'simple majority' of those who participate in the ballot must be 'in favour' of industrial action. 

If the majority of the workers eligible to vote are providing “Important Public Services” then the same 50% 'turnout' requirement applies. However industrial action will only be supported by the ballot if at least 40% of those eligible to vote (not 40% of those who actually take part in the ballot) vote in favour.

EXAMPLE BALLOT PAPER

Picketing

Strike action will commonly involve picketing organised by the union. This has the aim of encouraging others to join the strike or to publicise a dispute. A union which organises unlawful picketing is open to legal action for damages.

To be lawful picketing must comply with the following requirements:

• Picketing can only be conducted by a worker who is employed by the  employer with whom the union is in dispute, at or close to his place of work; an ex worker who is a party to the dispute; or a trade union official representing the workers on strike.
• The purpose of the picketing is to obtain or communicate information or to persuade an individual to work or abstain from working.
• The picketing is peaceful. There must not be any threatening or violent behaviour.

The Trade Union Act 2016 introduced additional requirements.  These apply when the picketing has been organised by a trade union or the union has encouraged its members to take part in the picketing. The additional requirements are as follows:

• The Union must appoint a person to supervise the picketing
• The Picket Supervisor must be an official or other member of the Union who is familiar with the Code
• The Union or Picket Supervisor must take reasonable steps to provide the Police with specific information (as provided for in the Trade Union Act 2016).
• The Picket Supervisor must be provided with a letter by the Union stating that the Union has approved the picketing.  This letter must be shown by the Picket Supervisor to anyone acting on behalf of the employer as soon as reasonably practicable after receiving such a request.
• The Picket Supervisor must either be present when the picketing takes place or readily contactable by the Union and the Police and able to attend at short notice.
• When attending the picketing, the Picket Supervisor must wear something to identify themselves.

There is a Code of Practice setting out guidance to unions and employers in relation to picketing. The Code advises against mass picketing as this is intimidating and states that “in general the number of pickets should not exceed six at any entrance to or exit from a workplace, frequently a smaller number will be appropriate.”

In some cases, where an employer’s premises are located within a private industrial estate the picketers may have to go outside the entrance to that estate and not just outside the gates of the premises.

Remedies

There are two main remedies available against unions responsible for unlawful industrial action: an injunction and/or damages. Of these, an injunction is the more effective as this is a mechanism for preventing industrial action from taking place. 

Damages

If a tort has already taken place because the employer was unable or too late to obtain an injunction, the employer may obtain damages against a union subject to a statutory cap on the damages which varies depending on the size of the union.

Fewer than 5000 members - £40,000

5000 to 24999 members - £200,000

25000 to 99,999 members - £500,000

100,000 or more members - £1,000,000

These limits apply with effect from 21 July 2022 and represent a substantial increase on the previous maximum figures. 

In practice the actual cost to a company of industrial action may exceed these figures and will not be recoverable.

Injunctions

The main weapon for employers is the injunction. This is obtained by applying to the High Court. An interim injunction is a remedy that is sought at the early stage of civil proceedings that will remain in force until the trial. The aim of injunctions is to prevent one side to the proceedings suffering losses pending a trial which might take months or even years to be heard. In employment disputes the injunction often becomes an end in itself as it prevents the strike action taking place and the case never comes to a full trial.

In response to an injunction the union may be able to remedy a defect in its arrangements for the industrial action or it may start the process again with a fresh ballot. However, usually in these circumstances the cause will have lost momentum and the employer will have the advantage.

Injunctions must still be approached with caution as they may lead to entrenched animosity between the employer and the employees which can have repercussions at a later stage,  for example in the union having a continued negative response to change.

Guidance on tactics for Employers facing Industrial Action

Attempting to get a 'no' vote

Even before the dispute has reached the formal stage of a ballot, one option is to write to employees explaining the situation and the reasons for the company’s stance in the negotiations with the union.

Communicating in this way, before the ballot, has a significant advantage; the employer is not seen to be reacting to the 'threat' by the Trade Union and is being proactive in advising all its employees of its stance and rationale. 

It may be advisable to write to employees’ home addresses as this ensures the content is considered in isolation from other employees, and may have greater personal impact.

Managing the ballot process

In the period immediately before the ballot there is a significant amount of work the Company may need to undertake:

• Identify those employees who are members of the Trade Union; check to see if “pockets” of high membership exists; establish your areas of high risk or weakness.
• Review the skills and competencies of those people who are unlikely to take part in the dispute; check whether any accreditation is required for them to perform any particular function or carry out your operations. For example: 

1. Will you have sufficient accredited individuals/quality inspectors to 'sign off' on products/processes?
2. Will you have sufficient staff to cover other logistically important roles (e.g. fork lift truck drivers or machine operators) during the strike period? If not, do you have any existing staff with the necessary skills who are not currently deployed to these roles? Could they be offered refresher training? 
3. Note that, if you are unable to plug any gaps with existing staff not taking part in the dispute, it is now possible to engage agency workers to cover for striking staff (with effect from 21 July 2022). You may wish to engage with agencies at an early stage to make sure they can provide the right workers with the right skills. 

This forward planning is absolutely imperative as it will enable you to identify areas where potential problems exist and gaps can be filled. Of course, this may have the benefit of building much more flexible workforce when the dispute is over.

In addition it may be necessary to drill down into the real reason for the potential dispute; is it about pay or are there underlying reasons for concerted action? It is helpful to review what happened at meetings leading up to the problem escalating:

• Could something the Company believed to be a minor issue be a key aspiration of the workforce?
• What is the driving force behind the action?
• Have different segments of the business different goals? If so, can any of these unique issues be solved?

Always remember a ballot is about numbers; the total population eligible to vote and the number who actually do take part.

The law stipulates that, in all cases, 50% of those eligible to vote must actually take part in the ballot. Once this threshold is met, a 'simply majority' of those who take part in the ballot must vote 'in favour' of the action.

Where the majority of those entitled to vote work in 'important public services', the 50% participation threshold applies. However, additionally, at least 40% of those entitled to vote (not 40% of those who actually took part in the ballot) must vote 'in favour' of the action. 

It may therefore potentially be advantageous to focus in on the groups who make up the electorate. It is extremely important that you do not actively induce an employee not to take part in a ballot, or induce them to vote in a particular way. However, it is acceptable to explain the Company's position and the potential impacts industrial action may have. If they have no strong feelings about the issues at stake, individuals are unlikely to support an action which will have a detrimental effect on their take home pay. Your communication may galvanise them to vote against the proposal. 

Most disputes are unlikely to receive media attention. However, if this situation arises, it is important to be as proactive as possible. If you have a public relations or media department within your organisation they must be briefed and included in any discussions. If you don't have dedicated PR support you may wish to consider engaging a specialist firm to deal with press/television enquiries. Your HR Rely advisor can also support you with 'message management' and minimising potential reputational damage. 

Temporary staff

It was previously unlawful to bring in agency workers to cover for staff who are involved in industrial action. However, with effect from 21 July 2022, this prohibition was removed, and employers are no longer restricted from engaging temporary workers when industrial action is taking place. This is likely to make it significantly easier for employers to maintain operations through a strike period. 

Previously, an employers only option was to recruit temporary staff to the organisation's payroll before or at the point of the ballot. This option remains available. However, it may be very challenging to recruit suitable candidates quickly enough, and to train them in your operations in a very short space of time. Bear in mind that any temporary staff will likely need to be trained by staff who are contemplating taking industrial action, which may raise a number of practical and employee relations issues. 

Bear in mind that either engaging agency staff, or carrying out temporary recruitment may harden attitudes, as it will usually be apparent that the new recruits are intended to lessen the impact of the  industrial action contemplated.

Minimising the disruption

However unpalatable, it may be necessary to inform your customers and suppliers of a possible dislocation of service or receipt of product. For the former it will be necessary to explain the situation and to advise  how you intend to deal with the potential difficulty. It is vital to stress this is only a potential issue at this stage, and to outline the steps which are being taken to resolve the conflict. Again, it is preferable to be open and transparent, rather than risk damaging relationships by giving your clients insufficient notice of potential problems. 

If you deliver to customers on a 'just-in-time' basis there are likely to be serious penalties associated with a late delivery or a failure to deliver at all. The potential costs of this have to be anticipated well before any dispute becomes active. It may be appropriate to consider increasing production and 'stockpiling' for this reason.

Equally, keeping your suppliers up to speed is important. Delivery drivers being turned away by pickets may attract unwanted media attention,  and substantial wasted costs. In addition, if the drivers do cross the picket line, you may not be able to use the raw materials resulting storage problems and additional expense. 

One potential option, depending on the magnitude of the dispute, might be to outsource the work if possible and/or desirable. Clearly the upside is that you keep your customers satisfied in the short term and any adverse impact on the business is reduced; the downside is, of course, that you expose your client to a potential competitor. Depending on the nature of your operation, outsourcing work on a relatively short term basis may not be commercially viable. 

On occasions, those employees intending to take action may work in areas of the business, which if closed down for any significant time, may cause damage to plant or machinery which would preclude a normal return to work after the dispute is over (for example if a furnace becomes cold, or a where a halted assembly line will take significant time to restart). In these circumstances, it may be advisable to write to the General Secretary of the Union concerned, highlighting the need to maintain essential services and the integrity of plant and equipment during the industrial dispute. It may be possible to agree a minimum level of staffing during the dispute to avoid lasting damage or hardship.

If you need any advice or support in planning for proposed industrial action, please contact your HR Rely advisor.