Govt puts profit ahead of people in collective redundancy consultation

27 June 2012

By Roger Jeary

Perhaps the one short paragraph reflecting the 23 trade union submissions is indicative of the importance attached to the views of workers and trade unions in government considerations…

So the government’s call for evidence last year on redundancy procedures has led them to the conclusion that a compulsory 90 days consultation where more than 100 jobs are to be lost is preventing businesses fulfilling their potential. I wonder if that conclusion came from workers or their representatives who perhaps have the greatest experience in handling redundancy situations, given that trade unions handle far more redundancies than any one employer. Perhaps the one short paragraph reflecting the 23 trade union submissions is indicative of the importance attached to the views of workers and trade unions in government considerations.

Indeed the government consultation document published on 21st June 2012 suggests that too much concern is devoted to those about to lose their jobs rather than those who will remain employed. No acknowledgement is given to the idea that the treatment of redundant employees has a lasting impact on retained employees and their morale. Lack of meaningful consultation or excessive haste in terminating contracts leaves remaining employees with fears for their futures should similar situations arise.

It really is perverse for the government to suggest that it is in the employee’s interest to have a shorter consultation period for redundancy as this will ensure that notice of dismissal can be issued sooner. This it is suggested allows the employee to plan ahead sooner than would otherwise be the case under current consultation arrangements. In over 25 years of negotiations with employers on redundancy issues I have never met an employee who has wanted their notice of dismissal to be issued sooner rather than later thus reducing the possibility of saving their job.

Of course this consultation is starting from the ill conceived notion that the current arrangements for collective consultation are in any way adequate. UK legislation, although derived from the Collective Redundancies Directive, fails in one major aspect and that is that consultation is after the decision to declare redundancies rather than about the decision itself. This fact has long since been the problem faced by trade unions or workers in being able to properly challenge the rationale for redundancies or propose alternatives to the course of action proposed. Although the consultation document seeks to address this issue, government continues to hide behind the notion and ECJ Decisions (Akavan1) which determined that consultation need only begin once a strategic decision had been made by the employer rather than the overall corporate entity. In today’s global business world decisions which will lead to redundancies in an individual workplace are frequently taken from afar and are in tablets of stone by the time they are conveyed to trade unions at factory or office level. All that remains to be consulted about is how many, how much and how soon.

The consultation document does address what should be consulted about. The issue of what can be the subject of consultation is summed up on page 29 where the following sentences make clear – “This does not mean, however, that the consultation is about the decision itself. The consultation is always about the potential to avoid redundancies.” The approach to this is one close to my heart as I was the union official (in the days of MSF2) which challenged an insurance company over the principle of whether the proposals to declare hundreds of redundancies across its sales force had been ‘contemplated’ prior to its ‘proposals’ being announced to the workforce and the recognised trade union. Once again the opportunity arises for the UK government to address this issue by a simple amendment to current legislation to amend section 188 of TULRA 1992 by replacing “proposing to dismiss” with “contemplating dismissing”. Once again the government ignores this proposition.

So what is this consultation all about? Primarily it is government responding to business demands to allow them to dismiss workers by way of redundancy more quickly and at less cost. The government has decided to reduce the consultation period by at least a half and possibly a third and we are, as usual, left with Hobson’s choice, 30 or 45 days minimum consultation period. Here was an opportunity to correct the inequities of our system, instead we find ourselves facing another nail in the coffin of worker’s rights and protection.

Perhaps it is ironic that on this occasion the government is it least complying with its own code of conduct for consultation and granting the full 12 weeks for responses. Three times as long as it proposes employers need take to sack 100 plus workers. Perhaps it should also take note of its own acceptance and that of employers that trade unions are best suited to be consulted on the subject of redundancies. Hidden away on page 23 is a paragraph asserting that:

“Responses to the Call for Evidence suggested that employers valued the contribution to the consultation process of experienced, well-trained employees’ representatives. Where they existed, employers preferred to consult with trade unions or established information and consultation forums. As such, the Government does not intend to change the primacy of trade unions in the consultation process.”

It’s a pity the same primacy was not afforded to trade unions in the evidence presented earlier this year to government on this subject.

For more discussion on redundancy law, take a look at our employment rights books section, including Roger Welch’s The Information and Consultation Regulations – Whither Statutory Works Councils?

The IER also holds regular employment law seminars, with conference papers from previous events on redundancy available here and here.