Unions win High Court battle over ‘strike breaking’ agency worker regulations

A High Court judge has found that the Government acted “unlawfully and irrationally” when it implemented regulations allowing businesses to supply employers with workers to fill in for those on strike.

Via Thompsons Solicitors:

“In the High Court judgment, Mr Justice Linden found that the decision by the then-business secretary Kwasi Kwarteng not to consult unions, as required by the Employment Agencies Act 1973, was “… so unfair as to be unlawful and, indeed, irrational.”

The High Court legal challenge was brought by eleven trade unions, ASLEF, BFAWU, FDA, GMB, NEU, NUJ, POA, PCS, RMT, Unite and Usdaw, coordinated by the TUC and represented by Thompsons Solicitors LLP.”

Thompson’s Head of Trade Union Law, Richard Arthur said:

“This is a significant victory for the entire trade union movement and preserves a vital safeguard in ensuring the right to participate in industrial action is effective.”

Thompson’s Solicitor’s reported: From 1976 until 2022, it was illegal under UK law for an employment business to help an employer break a strike by knowingly providing workers it engaged (often known as agency workers) to a company to replace employees participating in official industrial action.

Most recently, this was set out in Regulation 7 of the Conduct of Employment Agencies and Employment Businesses Regulations 2003, made under Section 5 of the Employment Agencies Act 1973. It is also a criminal offence for an employment business to supply workers for this purpose.

Crucially section 12 of the Employment Agencies Act 1973 provides that the Secretary of State shall not make any regulations under the Act until after consultation has ensued.

In 2015, the government initiated a public consultation on its proposal to revoke regulation 7. Most respondents opposed the proposal, and the government did not implement it. However, in June 2022, the government repealed the regulation seven years later without further consultation.

The Conduct of Employment Agencies and Employment Businesses (Amendment) Regulations 2022 were presented before Parliament on 27 June 2022. They were approved by the Secretary of State for Business, Energy and Industrial Strategy, Kwasi Kwarteng, on 20 July 2022.

The 2022 Regulations took effect the following day, overturning the decades-long ban on agency workers replacing striking workers.

In bringing a Judicial review challenge against the introduction of the 2022 Regulations, the unions argued that the decision to repeal regulation 7 was unlawful because:

1. The then Secretary of State for business failed to consult unions, as required by the Employment Agencies Act 1973.
2. It undermined the human right to strike, protected by Article 11 of the European Convention on Human Rights.

In today’s judgment, Mr Justice Linden found that the government had acted unlawfully in not consulting with the unions. In doing so, he rejected the government’s argument that it could rely on the public consultation on regulation 7 from 2015 and did not need to conduct a fresh consultation to consider views and fresh evidence of the labour market post-Brexit, seven years after the 2015 public consultation.

Mr Justice Linden said: “It is also indicative of Mr Kwarteng’s lack of interest in evidence or views about the impact and desirability of the proposal to revoke regulation 7 that the decision was to proceed at exceptional speed, despite the concerns of Mr Stevens about the effect on Parliamentary scrutiny, and without any further consultation at all.” (Para 175).

Since July 2021, Mr James Stevens has been the Deputy Director for Employment Rights and Enforcement in Labour Markets. In that capacity, he is responsible for the legal framework relating to industrial action and agency worker policy.

Mr Justice Linden continued in today’s judgment: “Mr Kwarteng has not given evidence about why he did not want to consult further, although it appears from the contemporaneous documents that a key reason was that this would stand in the way of the objective of the 2022 Regulations being laid and/or coming into effect before the summer recess. Such a reason would be inconsistent with section 12(2), unfair and irrational given that it frustrated the aim of informed decision-making and given that, as Mr Stevens advised, there was no compelling reason for the degree of haste with which the Government proceeded and good reasons not to.” (Para 180).

Mr Justice Linden concluded: “All of these reasons led me to conclude that the Secretary of State’s approach was contrary to section 12(2) of the 1973 Act, so unfair as to be unlawful and, indeed, irrational.” (Para 191)

Based on his ruling in relation to Ground 1 of the arguments against the Government’s decision, Mr Justice Linden did not make a finding in relation to Ground 2.

Richard Arthur added:

“The judgment makes clear that the then Secretary of State had a staggering disregard to his legal obligations when introducing legislation that enabled employers to engage agency workers to cover the duties of striking workers. He was driven solely by a political ideology to meet a self-imposed deadline to implement the regulations in the face of mounting industrial action across the country.

He took this decision notwithstanding advice he received that it was likely to be counter-productive to the problem he wanted to address and was being rushed through without regard for the duty to consult, which was a fundamental legal requirement. This is bad law-making made ‘on the hoof’ and the Court has rightly held the Government to account”.

General Secretary of the TUC, Paul Nowak, commented:

“This defeat is a badge of shame for the Conservatives, who have been found guilty of breaching the law.

Bringing in less-qualified agency staff to deliver important services risks endangering public safety, worsening disputes and poisoning industrial relations.

The government railroaded through this law change despite widespread opposition from agency employers and unions. The courts even found ministers ignored evidence that the measure would be counterproductive.

This is the same reckless approach behind the anti-strike bill, which has faced a barrage of criticism from employers, rights groups and international bodies, and which has been amended by the House of Lords on three separate occasions during parliamentary ping-pong.

Ministers should spare themselves further embarrassment.

These cynical strike-breaking agency worker laws must be scrapped once and for all – and the draconian anti-strike bill must be junked for good too.”

Unite General Secretary Sharon Graham said:

“This is a total vindication for unions and workers. The government’s decision to allow employers to recruit agency workers to undermine legal strike action was a cynical move to back their friends in business and weaken workers’ legal rights to withdraw their labour.

It was entirely counterproductive as rather than weaken industrial action it has hardened attitudes and unnecessarily extended strikes. This ill-thought out, divisive legislation must be consigned to the dustbin of history.

Employers will be barred from recruiting agency workers to undermine legal strike action from Wednesday 10 August. Unite will be ensuring that all companies where it is involved in disputes, are fully aware of the judgment and abide by the High Court decision.

Since July 2022, there have been several high profile industrial disputes, including a number of refuse strikes, where an employer has recruited significant numbers of agency workers to seek to undermine strike action.”

Unite legal director Stephen Pinder said:

“Unite will be leaving employers with no shadow of a doubt that once they are barred from using agency workers during strikes, they must abide by the letter of the law.”

Commenting on the judgment, Unison General Secretary Christina McAnea said:

“No one ever wants to go on strike. But when that difficult decision has been taken, employers should be throwing everything but the kitchen sink at ending a dispute, not inflaming tensions by undermining staff.

This futile piece of legislation has barely spent a year on the statute book. Parachuting untrained agency workers into the midst of industrial hostilities isn’t fair or safe for them, the public or the staff out on strike.”

Jamie Hanley, GMB’s Legal Director, said:

“Today’s ruling is a victory for all workers. This was a cynical attempt by the Tory Government to undermine the effectiveness of strike action.

Ministers knew when they attempted to railroad through these changes that they had failed to consult properly. Bringing in less qualified agency workers puts the safety of the public at risk.
“Employers should be under no illusion – GMB will ensure they abide by the law and do not use agency workers to fill in for our members who are on strike.

Meanwhile the Government ought to be embarrassed by today’s judgement which found that the Conservative Secretary of State’s approach was ‘so unfair as to be unlawful and, indeed, irrational’.”

IER Chair John Hendy KC, said:

“The case shows that the government is ideologically unable to tolerate an obligation to consult unions even to the extent that, as the judge held, it was ‘so unfair as to be unlawful and, indeed, irrational.’ The same irrational mindset impels the government resolutely to refuse the Lords’ amendment to the Strikes (MSL) Bill to include an obligation to consult before making minimum service regulations.”