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Wednesday, May 29, 2024

Reducing strike risk

Charlotte Smith explores the tricky world of trade unions, strike actions and court injunctions

Work place strikes are surging and while rail and royal mail disputes have been dominating headlines, make no mistake: food and drink giants have been feeling the heat too.

Budweiser is the latest big name brand facing uncertain times due to employee strike action. And, businesses such as Greencore, Crown Bevcan, Valeo Foods and Weetabix know only too well what happens when talks falter and trade union negotiations collapse.

Industrial action within the FMCG industry presents significant business risk for employers with unionised workforce populations. Strikes cause severe disruption to all business operations and have a knock-on effect on supply chains – slowing production or preventing acceptance of deliveries – which can lead to contract breaches. Employee relations issues can also expose the business to negative publicity.

Currently, there are many factors influencing industrial action following the pandemic including Brexit, soaring energy costs, supply chain disruption caused by war in Ukraine, as well as rampant inflation. Within this context, decisions taken by employers relating to pay, contract changes and redundancies have come under closer scrutiny by the public and their employees. Employers are seeing increasing levels of challenge (even where generous pay rises are proposed) with unions supporting action from their members.

Here are some of the key things that FMCG businesses need to know about industrial action and some advice on when legal support may be necessary.

What does industrial action include?

The law relating to industrial action in the UK is complex and has not been high on the legal risk agenda during a long period of stability in industrial relations.

Most current industrial action is related to pay and working conditions, which is prevalent across all industries including the food and drink sector. This may consist of strike action (a stoppage of work by the striking population entirely) or action short of a strike, such as ‘work-to-rule’ (employees perform their duties strictly to the letter of their contract and refuse to take on additional duties), ‘work-ins’ (occupation of the employer’s premises, to prevent a proposed workplace closure), and the banning of overtime or call-outs.

The food and drink sector is made up of lots of moving parts, from sourcing raw materials, to processing, logistics and delivery. The pressure to award pay rises in one of these areas can lead to workers in another area feeling undervalued and making demands. For example, leading convenience food producer, Greencore, recently awarded pay rises to fruit and vegetable pickers, which led to delivery drivers threatening to strike. This makes wage negotiations a complex and multi-layered exercise in the food and drink sector.

More companies are looking to modernise their process, which can often lead to changes in working practises and conditions. In some cases, a need to streamline business operations may also lead to workforce changes, with potential changes being made to available work hours or even redundancies. At present, there appears to be a trend towards more active industrial cases than we have seen in the last 20 years, therefore it is worth businesses considering legal advice as part of overall planning and risk management.

There is a distinction to be drawn between official action, which is properly authorised and endorsed by a union, and unofficial action, where employees take matters into their own hands.

There are complex rules relating to balloting and notification requirements which unions must comply with for official industrial action to have legal protection.

Employees participating in official industrial action, which has been properly balloted and notified to the employer, are protected from dismissal for at least the first 12 weeks of the action, known as the ‘protected period’ and possibly longer, although the position is more complex after that and requires fact specific analysis.

Strike action within the food and drink industry is often accompanied by picketing where workers line up outside the work site seeking support for their cause, and to try and dissuade others from working. Picketing can create an uncomfortable environment for non-striking employees and third-party contractors who need to enter the site to make deliveries.

Peaceful picketing is permitted by law, however it can escalate into unlawful conduct if there is any unacceptable behaviour towards people crossing the picket line or attempts made to block site entrances.

The right legal support is essential:

  1. Dialogue with unions – if your food and drink business is planning changes or conducting pay reviews, recognition agreements should be reviewed and complied (some of which may be quite historic documents). The status of the union (for example, whether it is recognised and whether that recognition is statutory or voluntary) should be considered, along with any collective agreement. Seek advice about the correct procedure to be followed and assist in ensuring negotiations with the union are conducted in a productive manner and fully exhausted, in order avoid disruptive industrial action.
  2. Determining whether the action is official and protected – It may not be possible to avoid industrial action altogether. Legal counsel can assist you in distinguishing between official and unofficial action and determining whether balloting and notification procedures have been complied with. Where action is unlawful, lawyers can help you consider the options available, including obtaining court orders to prevent an unlawful strike and considering whether disciplinary action against participating employees, including possible dismissal, is appropriate. Where a strike is lawful but continues beyond the 12-week ‘protected period’, an expert legal partner can support you with the process of assessing whether dismissal of employees for continued action may be fair.
  3. Running your business during industrial action – as part of contingency planning, the business may need to re-deploy non-striking employees from other parts of the business based in other locations to cover the work of striking employees and/or use casual/agency staff. However, there are strict legal rules which must be complied with and it is a criminal offence for supply agency workers to be supplied to undertake the duties normally performed by a worker who is on strike or taking part in industrial action (albeit new legislation to change this position is expected to shortly come into effect). Where non-striking workers are to be redeployed, careful consideration should be given to health and safety obligations and training. Legal counsel can support you in preparing a plan to keep the business operating and ensuring the plan is legally compliant.
  4. Conduct during the action – while peaceful picketing is permitted, we have seen instances where picketing has crossed the threshold of acceptable behaviour. Your legal team can advise you on urgent legal action which may be taken when faced with unlawful picketing, including engaging with the unions, taking court action and dealing with individual cases where a picketing employee’s action constitutes misconduct.
  5. Urgent injunctions – This can extend to anti-strike injunctions to prevent unlawful strikes and other injunctions designed to limit the number of picketers and confine their activities to peaceful protesting as well as to create exclusion zones which picketers cannot enter.

Whilst some businesses may wait until they have no choice but to seek legal support, acting early in circumstances of industrial action could save your business time, resources and reduce additional pressures. It is vital that businesses take these situations seriously to ensure they know what they should be doing and can avoid further escalation. By seeking this legal advice, it may be just be what keeps you and your business out of court.

www.walkermorris.co.uk

 

 

Charlotte Smith
Charlotte Smith
Charlotte Smith, Director, Employment and Immigration Group, Walker Morris. Charlotte leads the Walker Morris Employment-Sport practice and works closely with several Premier League and English Football League clubs. She advises on all aspects of employment law and has close relationships with clients in the food, drink and manufacturing sectors. www.walkermorris.co.uk

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