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Lord McCarthy is a fellow of Nuffield College and Templeton College and a leading specialist in industrial relations. He has written widely on labour law reform and acted as a mediator and arbitrator in innumerable industrial disputes. He has also advised past Secretaries of State for Employment and was a Labour spokesperson on Employment in the House of Lords from 1979 to 1997. This publication, like all publications of the Institute, represents not the collective views of the Institute but only the views of the author. The responsibility of the Institute is limited to approving its publication as worthy of consideration within the labour movement.

ISBN 1 873271 67 0 March 1999 designed and published by the Institute of Employment Rights 177 Abbeville Road London SW4 9RL 0171 498 6919 fax 0171 498 9080 email printed by Upstream (TU) 0171 207 1560 ÂŁ6.50 for trade unions and students ÂŁ20 others THE



fairness at work and trade union recognition: past comparisons and future problems

executive summary

by Lord McCarthy




the ground to be covered



previous models the influence of Donovan CIR1 CIR2 ACAS/CAC

5-14 5-7 8-10 11-12 13-14


new labour’s new approach

fairness at work and trade union recognition

the manifesto commitment the role of the CAC determining bargaining unit disputes degrees and forms of support enforcement derecognition


15-23 15-17 18-19 20 21 22 23


the conditions of success or failure


the supply of references possible lessons selecting unions possible lessons employer co-operation possible lessons deciding the bargaining unit possible lessons positive recognition criteria

24-28 29-31 32-33 34 35-37 38-41 42-43 44-48 49-53

possible lessons enforcement possible lessons reliance on the ordinary courts the exclusion of substantive sanctions

54-63 64-66 67 68-70 71-80


enforcement extension derecognition CHAPTER 6

summary and conclusions the ground to be covered new labour’s new approach the conditions of success or failure a ensuring a sufficient supply of suitable references b selecting appropriate trade unions c securing the co-operation of employees d deciding appropriate bargaining units e developing acceptable recognition criteria f enforcement g enforcement extension h derecognition

81-91 81-86 87-89 PAGES

59 59 60 60 60 61 61 62 63 64 66 67





recent publications



enforcement extension and derecognition



fairness at work and trade union recognition

executive summary

The aim of the paper is to set New Labour’s proposals for helping unions to obtain recognition in their historical context; comparing them with the three attempts by previous governments to pursue similar objectives, seeking to learn from past mistakes and foresee future problems. The approach is that of a friendly critic, who recognises the care and ingenuity that has gone into the drafting of the Employment Relations Bill as a whole. It is argued that the record suggests that success or failure will largely depend on overcoming six related problems which are summarised below. I ensuring a sufficient supply of suitable references (Paras 25-31) In the past a general right of access has resulted in a flood of unsuitable references which wasted resources and undermined confidence in the statutory machinery. This time the CAC must be in control of its case load and unions given an incentive to submit their strongest and most significant claims.

I securing the co-operation of employers (Paras 35-41) The Bill provides a number of protections and rights for workers and unions campaigning for recognition. The question is whether they go far enough to ensure ‘fair play’ throughout a campaign. The record suggests that in all recognition struggles the employer retains considerable advantages. It is suggested that three further requirements are needed:

executive summary

To this end unions with a declared interest should be advised of their likely ‘quota’ of references, by reference to a formula based on total membership (Para 34).



A union right to hold meetings, distribute literature and make use of accredited ‘volunteers’ from outside the firm (Para 14).


A statutory responsibility to ensure ‘fair play’ placed on the CAC, involving their presence in the firm as and when required (Para 41).

iii Statutory powers which enable the CAC to deal with all justifiable complaints against any of the parties immediately (Para 41). I deciding appropriate bargaining units (Paras 42-48) Previous disputes over bargaining units have largely related to the attempts of the two sides to ensure that their opponents lost the ‘ballot’. This time the CAC has been given six partly conflicting factors to take into account. In the light of past experience four considerations are advanced for them to bear in mind: i

No single factor should be regarded as so important that the agency ignores or sets aside, other relevant factors. The CAC should pursue ‘balance’ and ‘acceptable compromise’ (Para 46).


Unions are entitled to stress the need to regard employee feelings of Commonality’ – ie. the existence of similar problems and perception which are best pursued in concert. Sensible employers ought not to oppose such criteria anyway (Para 46).

fairness at work and trade union recognition

iii Management’s legitimate concern must be that units do not cut across, or disrupt, existing financial and organisational systems – eg. profit centres and autonomous business units. But nowadays no sensible union negotiator would want to hamper management effectiveness in this way (Para 46).


iv The CAC should be free to award bargaining rights covering any or all of the subjects listed in Section 178(2) of the 1992 TULR (Consolidation) Act (Para 48). I developing acceptable recognition criteria (Paras 49-53) Given the differences between employers and unions on this subject the tests in the Bill could be said to represent an ingenious compromise. Unfortunately it is impossible to tell, in advance, how far the insistence on the ‘40 per cent roll test’ will deny recognition to unions who can secure a substantial majority of votes. Much depends on securing a high level of participation amongst the workers involved. To this end five suggestions are made:


Time limits on CAC decisions should be ‘indicative not mandatory’. Hurry or delay may help one side or the other according to the circumstances. The CAC must give both parties time to answer points made by the other (Para 56)


It should be appreciated that postal ballots are no less liable to interference than those based on the workplace. Also that malpractice is not a monopoly of either party and is most likely to develop during the campaign. All this means that the CAC must ensure a fair and balanced campaign as well as an accurate count (Para 59).

iii The CAC must be pro-participation, favouring the mix that maximises turnout – eg. workplace or postal ballots. proxy voting etc. (Para 80). iv All parties with an interest in achieving recognition on the basis of acceptable criteria should support the objective of high participation. Subsequent regulations and the forthcoming Code of Practice should embody this commitment (Para 60). v

One increasingly common malpractice must also be dealt with: Discrimination by means of advantageous terms should be made unlawful (Paras 61-63).


Problems of access and cost are likely to arise if remedies are only available via the ‘ordinary’ courts. It is suggested that good use could be made of the simpler and quicker procedures provided by specialist bodies such as the CAC and/or EAT (Paras 65-70).


Doubts have also been raised about the availability of ‘the ancient and discretionary remedy’ of ‘specific performance’. It has been pointed out that union based actions for contempt will not be readily obtained.

iii The proposed DPA is actually an imposed statutory artefact, which

executive summary

I enforcement (Paras 64-80) No completely satisfactory method of enforcing recognition ‘declarations’ has yet been found; so it is understandable that the Bill proposes a new method based on legally enforceable ‘contracts’. But cogent doubts can be advanced against exclusive reliance on this device. They are summarised below together with proposals for supplementation:


is unlikely to engender loyalty or commitment amongst the parties. It could become a source of further conflict and disagreement (Paras 70-71). iv Above all overseas experience suggests that reliance on a procedural model affords recalcitrant management with consideration opportunities for delay and prevarication. They remain free to accept the form of recognition while denying the substance (Paras 73-4). v

The conclusion drawn from this series of doubts is that the proposed remedies need to be supplemented by some form of claims procedure. The simplest way would be to provide for legally binding arbitration to be activated by the CAC on proof of persistent employer prevarication and non-observance (Para 80).

vi Given such a procedure it should be considered whether there is a case for exemplary awards (para 76).

fairness at work and trade union recognition

I enforcement extension (Paras 81-86) Legal enforcement is also to be available to unions and employers who can demonstrate the non-observance of an existing ‘voluntary’ procedure agreement. It is suggested that this proposal prompts even more doubts and reservations. Thus:



Since most union complaints are likely to related to de facto customs and practices rather than formal de jure rights few management charged with breach are likely to concede the union case without a struggle. They may assert their right to withdraw such privileges given changed circumstances, or union non-co-operation. They may also challenge the union’s view of events, or interpretation of procedure (Para 82).


Even if unjustified breach is established the parties may not desire a solution in the form of a legally binding procedure agreement. In particular unions may not welcome additional peace obligations (Paras 82-83).

iii It is also unclear what the remedy will be if employers react to the threat of a reference by derecognition of the union. Given all these possibilities it does not appear to the present writer that enforcement extension in its proffered form is either practical

or advisable unless it is the Government’s intention to deny employers the right to derecognise in its present form (Para 85). I derecognition (Paras 87-91) So we come to what the Bill proposes on this final question. Three points are made: i

A case can be made for the Bill’s ‘reciprocal’ approach, which is largely confined to recognition agreements which arise from statutory references to the CAC. Derecognition is to be permitted where levels of support have fallen below those required to secure statute backing. This seems both logical and fair (Para 88).


Trade unionists might argue for similar statutory provisions restricting employer freedom in all areas where recognition has resulted from ‘voluntary’ agreement. But one doubts if such a law would be enforceable and nothing of this kind was promised in New Labour’s Manifesto (Para 89).

executive summary

iii Of course, if it is decided to retain the present freedom of employers to derecognise there can be no case for providing them with an additional statutory aid. Levels of support required to compel recognition do not. What the state has not given it should not help to take away (Para 91).


WHAT IS THE INSTITUTE? The Institute of Employment Rights was launched on 28th February 1989. As a labour law “think tank”, supported by the trade union movement its purpose is to provide research, ideas and detailed argument. In 1994 the Institute was granted charitable status. The Institute has attracted wide and distinguished support. Among the membership are John Hendy QC, Professor Keith Ewing, Lord McCarthy, Sir Peter Pain, and the general secretaries of Britain’s largest trade unions. The results of the work of the Institute are published in papers and booklets. It also provides short articles, free of legal jargon, for trade union journals and other publications. The Institute provides tools of analysis and debate for the trade union movement in the area of labour law. We are not a campaigning organisation. The Institute does not assume that legal measures can offer ultimate solutions for political, economic and social problems. However, it recognises that law has a part to play in influencing the employment relationship, both individually and collectively. Funding is from various sources, including subscriptions which entitle subscribers to a copy of all our new publications. If you are interested in subscribing or would like to know more about the Institute, then contact us at 177 Abbeville Road, London SW4 9RL, 0171 498 6919.


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