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Government’s anti-union law will push wages down, economist warns

Ministers could be breaking international law by allowing employers to bring in agency workers to break strikes

Adam Bychawski
28 June 2022, 12.24pm

Unions have accused the government of legalising a practice it condemned cruise operator P&O for just months previously.

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Sam Holiday / Alamy Stock Photo

Wages will fall if the government succeeds in its attempt to legalise strike breaking with agency workers, a senior economist has warned.

Plans have been laid before Parliament to repeal a 2004 law barring agencies from supplying temporary workers to cover employees who take industrial action. The legislation is tabled for today, although no vote is expected to happen until a future date.

Announcing the legislation last week, business secretary Kwasi Kwarteng said the government was revoking protections for striking workers in response to the industrial dispute between train companies and the National Union of Rail, Maritime and Transport Workers (RMT).

Tens of thousands of rail workers went on strike last week after the RMT’s request for a cost-of-living pay rise was rejected by train companies, who have also put forward plans for redundancies and changes to employment conditions.

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Transport secretary Grant Shapps said the law change, which will apply to employers across all sectors, would “ensure any future strikes will cause even less disruption”.

But experts said repealing the restrictions would hit workers’ pay, which is already being squeezed by surging inflation, by giving businesses more confidence to squeeze wages without the fear of retaliatory strikes.

“This move directly conflicts with Boris Johnson’s claims to want a ‘high-wage’ economy. Historically, it is when unions are strongest that workers win the highest wages,” James Meadway, director of the Progressive Economy Forum, told openDemocracy.

“If Johnson was serious about creating a high wage economy, he would be urging more people to join unions and fight for higher pay.”

The government is also proposing to raise the maximum damages a court can award against a union when a strike is ruled to be unlawful from £250,000 to £1 million.

Unions and employment lawyers have condemned the proposed legislation and accused the government of breaching international conventions.

Trades Union Congress general secretary Frances O’Grady said in a statement last week: “These plans are a deliberate attempt to undermine the right to strike and to reduce workers’ bargaining power. Bringing in less qualified agency staff to deliver important services will endanger public safety, worsen disputes and poison industrial relations.” 

Mark Dickinson, the general secretary of Nautilus International, a global union representing seafarers, told openDemocracy that the legislation appeared to take inspiration from disgraced cruise operator P&O.

“The government condemned the actions of P&O Ferries employing agency workers to replace 786 seafarers they illegally sacked,” he said. “Now they are seeking to use agency crew to break the strike of railway workers, rather than ending the precedent P&O Ferries have set, the government are following it.

“Our message is simple: agency staff cannot replace skilled professionals in shipping, on the railways or anywhere else.”

Shapps denounced the cruise operator’s “insensitive and brutal treatment of its employees” in March and Boris Johnson also promised that “P&O plainly aren’t going to get away with it any more than any other company that treats its employees in that scandalous way”.

The Recruitment & Employment Confederation (REC), a trade body for the recruitment sector, has also come out against the government’s plans.

Its chief exec Neil Carberry said: “The government’s proposal will not work. Agency staff have a choice of roles and are highly unlikely to choose to cross picket lines. Agencies want the ban to stay to avoid them being pressured by clients into supplying staff in hostile and potentially dangerous situations.”

It is not the first time a Conservative government has attempted to pass the legislation. The Department for Business, Energy and Industrial Strategy drafted regulations to legalise strike breaking with agency workers in 2015 – one of David Cameron’s manifesto pledges. 

But the proposal was abandoned after widespread criticism including from human rights groups. Liberty and Amnesty International said that the legislation would “undermine the rights of all working people” at the time

Even pro-business bodies such as the Regulatory Policy Committee (RPC), a group sponsored by the Department of Business whose stated purpose is to scrutinise new regulations on businesses, rejected the plans. 

The RPC said it would be more beneficial for an employer to bear the short-term costs associated with a strike instead of seeking agency workers.

Lawyers have warned that the move may also breach the UK’s post-Brexit agreement with the European Union.

Keith Ewing, a law professor at King’s College London, said in a blog post for Institute of Employment rights, that the government must abide by international labour treaties it previously signed as part of the deal. That includes the International Labour Organization (ILO) Convention 87, a treaty which the UK signed pledging to protect the right to strike.

The UK has already been criticised by the ILO for undermining the right to strike by allowing employers to replace striking workers under certain conditions.

Currently, employers can hire temporary replacements for strikers during the first 12 weeks of the dispute, so long as they are recruited directly. After 12 weeks, employers can hire permanent replacements.

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