Evasion of law by Sodexo demonstrates short-sightedness of collective redundancy consultation period cuts

Submitted by sglenister on Wed, 19/12/2012 - 15:52

19 December 2012

By Sarah Glenister, IER staff

On the day Employment Relations Minister, Jo Swinson announced the government will halve the minimum consultation period employers must take before mass redundancies, a trade union has been forced to ballot their members for industrial action as services contractor Sodexo attempts to evade existing laws on the matter.

GMB has issued a statement saying their members will take a vote on whether to go on strike early in January 2013 in protest against attempts by Sodexo to weasel out of their responsibilities when it comes to mass redundancy.

The employer has announced cuts to their workforce of 96 jobs at Brighton & Sussex University Hospital NHS Trust, including those of cleaners, caterers, porters, grounds maintenance and linen workers. Having secured the contract for the work at the hospital just a fortnight ago, the company has allowed a consultation period of only 30 days to discuss potential alternatives with trade unions.

This is legally permissible due to the fact they are making fewer than 100 employees redundant. However, GMB argues that additional cuts to hours and wages for Sodexo staff at the hospital is sure to lead to more workers walking out of their jobs. The employer is well aware of this, the union says, and is simply trying to evade the 90-day consultation it would be legally bound to engage in if it reduced its workforce by 100 or more. What's more, the business is putting workers' representatives and trade unions at even greater disadvantage by announcing its consultation will take place over the Christmas period.

"Sodexo know that by seeking to implement unreasonable contract changes, rotas and working practices this will lead to significant numbers of staff having no option but to leave," Gary Palmer, GMB Regional Organiser, commented.

"There are also significant concerns as to patient safety over these job cuts. These are obvious when you consider that the company plan to make cuts to front line staff such as those responsible for feeding patients and cleaning on the wards," he added. Sodexo reported revenues of €18.2 billion (£14.8 billion) in the 12 months ended August 2012, up 13.6% on the previous year, and an organic growth of 6.5%.

As major companies like Sodexo continue to find ways to escape their responsibilities to workers, you would think a responsible government would offer extra protection for employees - particularly when so many people are losing their jobs as the recession drags on. But in fact the Coalition have done the opposite, by making it easier for companies to make over 100 of their workers redundant after just 45 days of consultation.

In her official response to the Department for Business, Innovation and Skills' consultation into the halving of consultation periods for mass redundancy, Jo Swinson argued it is important to change the employment rights of workers according to the needs of businesses. And so, instead of labour laws being put in place to protect workers from the ruthlessness of the market, they are being taken away in order to encourage companies to consider their profits over their people.

"Business change is an inevitable consequence of modern competitive markets," Ms Swinson said. "Commercial and economic opportunities and pressures means companies will need to reorganise, merge, expand or contract in response. Employers will want to implement change as swiftly and efficiently as possible to limit the impact on productivity and morale."

She also argued that the rule changes are good for employees, saying they will now have more certainty over whether or not they are going to lose their livelihoods, so they will be able to start looking for a job earlier. We feel sure workers will not be thanking her, however, at a time when work is difficult to find - particularly full-time jobs at a high enough wage to support a family. With the government allowing employers to take away workers' rights in exchange for shares in their company, and salaries staying low as the Coalition ignores repeated calls for a living wage, those workers made redundant after only a 45-day consultation will simply find themselves unemployed sooner, leaving them with little or no time to retrain, reorganise mortgage or rent payments and settle bills. After all of that, they then face miserably low prospects of finding alternative work.

Assistant General Secretary at UNISON Bronwyn McKenna described Ms Swinson's announcement as "a cruel blow for workers and their families".

"Cutting the opportunity for employers and unions to realistically explore alternatives and ways to avoid large scale redundancies is a retrograde step," she argued.

She also recognised the opportunity this affords companies like Sodexo to continue evading the law. "This process can also be used to cut pay and conditions through disreputable dismissal and re-engagement strategies. Halving the period for consultation gives greater license to rogue employers to attack wages," Ms McKenna stated.If the government's decision to cut consultation periods to 45 days seems harsh, it may shock you to discover that the situation could have been even worse, with a large number of employers calling for the period to be cut to just 30 days.

But in other respects, the Coalition remained true to form, implementing employer proposals and rejecting union opposition. Employers "generally considered that legislation was necessary to exclude fixed-term appointees" from the law on consultation in the case of mass redundancy. The Minister confirmed that new legislation will be brought into effect to exclude fixed-term contracts which have reached their termination date from redundancy consultations. However, she noted that trade unions were opposed to this measure.

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