Andy Prendergast and Mike Clancy gave evidence.

Welcome back. Will the witnesses introduce themselves, please?

Mike Clancy:

I am Mike Clancy, general secretary of the Prospect trade union.

Andy Prendergast:

I am Andy Prendergast, GMB union national secretary for the private sector.

Good afternoon, gentlemen. I will put the same question to you as I put to the other trade union representatives we have heard from so far. The Bill is wide-reaching. Some people from other trade unions have even suggested that it would re-unionise the economy, to use words we heard on Tuesday. Do you share that assessment, and do you feel—because this is an important test—that your unions believe the Bill goes far enough?Q127

Mike Clancy:

The primary purpose of the Bill is to reset employment relations, and trade unions are an important part of that. I have the privilege of sitting on the ACAS council, which is a tripartite body responsible for overseeing good employment relations and good practice. That demonstrates that unions, employers and independents can work together successfully. I see that as the primary purpose.

The reality is that in so many jurisdictions that have positive employment relations and that are addressing their productivity challenge, unions play a very important role. An objective to have the right level of trade union membership in the economy, so that working people have a voice, is at the heart of the Bill. Previous Administrations have restricted the ability of working people to have a voice. So there is a real opportunity to, first, improve employee relations; secondly, ensure that working people generally have a voice; and thirdly, ensure that unions are part of the fabric of the economy in a way that addresses the challenges ahead. I would say that the Bill can deliver all those objectives.

Q So you do not think that there is any part of the Bill that is deficient, and that your union would rather see strengthened or modified in any way.

Mike Clancy:

The key thing we would like to see is that access to workplaces is not confined to physical premises, but is also digital. That applies where union recognition already exists. We need to ensure that we can address the workplaces of today and tomorrow, not just those of the past. Physical access is important, but many workplaces have remote, hybrid, virtual working arrangements, so we would want the Bill to be amended to ensure that digital access, in a way that is compliant with data protection, is addressed.

Q What does that look like?

Mike Clancy:

It probably looks like ensuring that the best practice from employers now—who allow us access to their intranet and to electronic and digital means, in terms of their staff—becomes the norm, and that it complies with data protection. That happens in workplaces up and down the country now, but some employers see the law in a different way.

An important thing to get across is that if you start to talk to an employer about organising their workplace, the best way to do it is by consensus. That means understanding the employer—understanding the nature of their product and what their concerns may be—as well as making sure that their workforce’s aspirations, if they want a collective voice, are delivered in a way that works successfully for all parties. The access conservation needs to reflect the nature of the workplace as it is now, not just as it has been. It should not be confined to physical premises.

Andy Prendergast:

From our point of view, this is very much a 21st century Bill for a 21st century economy. It is not about looking back; it is about trying to make sure that what we have is fit for purpose, moving forward. Unionisation rates are around 20% at the moment. If we look at a graph of unionisation and also at a graph of rising inequality and the fall in productivity, we will see that they are almost perfect correlations. We believe that collective bargaining is a way of improving things. That has been identified by organisations as diverse as the World Economic Forum and the Church of England. If the Bill ends up with higher levels of unionisation, which leaves lower levels of inequality, we believe that that will be a good thing.

On where the Bill is lacking, I think, like Mike, that we need to make sure that there is a digital aspect of access. Many of our members working for gig economy platforms in parts of the new economy do not have the old workplace that we traditionally know. It is not a factory and not necessarily an office. So we have to talk about how rights can be accessed by people who work remotely, who work from home, or who simply do not have a workplace.

There is one area where the Bill could be strengthened. We welcome the improvements in statutory sick pay, but we do not believe that they go far enough. We did a survey today of care workers at HC-One that shows that over one third cannot afford to take sick leave. We saw during the pandemic that having people go to work when ill, potentially spreading diseases, is bad for everyone. We think something could be done on that later that would ultimately help workers and help the economy generally.

Q You mentioned the 20% unionisation rate. Do you have a target that you want to see?

Andy Prendergast:

They key thing for us is that everyone who ultimately wants to join a trade union has the option to do so. It is important that people are aware of their rights, aware that they can join trade unions, and aware that they have a right to, for example, SSP on day one, statutory holidays and the minimum wage. Rights that people do not know about and that cannot be enforced are ultimately no use. This is shamelessly partisan, but I would like to see union rates being far higher, and I think that the economy as a whole would benefit from that.

Q It is a pleasure to see you in the Chair this afternoon, Sir Christopher. Good afternoon, gentlemen. Generally speaking, do you think that the Bill will improve working conditions, particularly for those in low-paid and insecure work?

Andy Prendergast:

I think the Bill is a major step in the right direction. One of the big problems that we have seen, certainly over the last 30 to 40 years, is the huge increase in insecurity in the workforce. That tends to have a massive impact on the individual concerned and their ability to fully partake in the economy, and to make long-term commitments through mortgages and loans—the kind of stuff that drives the economy. Ultimately, we have seen that as they have lost their guaranteed hours—in zero-hours jobs, for example—and there has been the removal of their employment rights, those people are less able to exercise those rights. So we see the Bill as a major way of moving industrial relations forward.

We would also point to the work around the pandemic. In the last 14 years, we were very much locked out of Government in most areas, yet when the pandemic came around, there was a fantastic bit of work between the CBI, the TUC and the Government, with Rishi Sunak standing on the steps of No. 10 talking about the fantastic work that led to the furlough scheme, which saved millions of jobs and millions of people from poverty. What surprised us is that that great work was then stopped virtually as quickly as it happened. If we look at other G7 countries, a tripartite system is what drives higher levels of productivity, lower levels of inequality, and ultimately, higher levels of investment and economic outcomes. We think that the Bill is a long overdue step in the right direction of moving some power back towards workers and away from businesses, too many of which exist for exploitation.

Mike Clancy:

I echo those comments. If we look at the responses from the business community, yes, there is going to be some anxiety about the detail and how it will work—again, I reference my experience not just in ACAS, but from working with employers more generally—but we find ways to do this and operate in practice successfully. Good employers have nothing to fear in the Bill. That is not just good employers that are larger, and we think that with the right degree of consultation, which the Government have committed to, we will be able to address those areas where there are a few wrinkles and things to ensure work in practice.

We have to reflect on what the alternative was. The deregulatory, more de minimis approach to employment regulation applied previously, and if that trajectory had continued, we would not have addressed the issues of precarious work and productivity, and we would not have been able to do that in a way that looks at the workforce of the 21st century, as opposed to looking backwards.

There is a lot in the Bill, but that is not surprising. There will probably be a long period of adjustment. With the right consultation, I think we will get to a position where we look back at this as a milestone in changing how we do things, a paradigm shift in relations. I think that it will drive better engagement not just for unionised workforces, but for workforces more generally, because that is where employers will see that they can answer the challenges on the next generation of technology insertion and organisational design, and make sure that they can get the talent that they need.

I am curious about whether you feel that the Bill’s provisions will encourage and support those who have been long-term unemployed, or those who find it difficult to get back into employment. Are the flexibilities embedded in the Bill going to help people back into work, as opposed to helping only those who are already in workQ ?

Andy Prendergast:

As a union that represents a large number of relatively low-paid people, we regularly come across the barriers to getting back into employment. One of the big ones we have seen is the expectation of flexibility, and specifically one-sided flexibility. We have a lot of people who are on benefits and want to work; unfortunately, often the only jobs they are offered are zero-hours jobs. It is difficult for people on benefits, because it is a bureaucratic nightmare to get on them, and people need to be supported to come off them to a guaranteed wage in a guaranteed job. Too often, they are offered zero-hours contracts, which replaces the guarantee of certain levels of benefit payments with uneven levels of reward. We want to get people back into meaningful work.

There are clauses in the Bill on removing exploitative zero-hours contracts—and the point there is “exploitative”. We look after thousands of Uber drivers, for example, and for them flexibility is very much the driving point. In the same way, a number of people benefit from being on genuine zero-hours contracts. At the same time, organisations such as McDonald’s and Wetherspoons have 80% to 90% of their staff on zero-hours contracts. There is no excuse for that. We find that the moment an individual chooses to exercise their flexibility is the moment they stop being offered shifts. That is a major block on people coming back to work, particularly when they are on universal credit.

We want to be able to give people genuine offers of employment so that they can better themselves, fully take part in the economy and deliver for them and their families. The Bill goes some way towards addressing that.

Mike Clancy:

I should make a general point before addressing more specifically the part of the economy your question focuses on. A failure of our economy for many decades now—in contrast with other economies with high levels of unionisation, collective agreement and partnership—is that we have not taken the fear out of change in the economy. That can mean that people’s reaction to change, and their ability to operate in the labour market, is correspondingly reduced. A lot of economies are able to ensure that if people lose employment, they are able to come back into employment much quicker—there are either statutory minima or collective agreements between employers, trade unions and others to make that happen. The Bill asks some fundamental questions about how we want to organise ourselves in the economy and says that, actually, it is better to have places where we convene and talk about the challenges than to do it company by company and enterprise by enterprise, and have an atomised conversation.

Andy touched on zero-hours contracts; we represent a lot of self-employed people, many of whom value their self-employment. Indeed, it is part of the process in film and TV production. They have experienced the precarity of that environment in recent years, particularly in relation to covid, and subsequently there have been other issues in respect of production. The legislation needs to look holistically at the economy. It is important to talk about flexibility in a way that engages all types of worker, not just those who may be able to work hybrid or remotely. The fact that the Bill makes employers, unions and others think about the flexibility proposition has got to benefit people’s ability to come back into the workplace.

Before I ask this question, I refer Members to my entry in the Register of Members’ Financial Interests. I am also a member of the GMB.Q

I want to ask about balloting. What are the practical implications for your unions of paper balloting? What sort of difference do you think electronic balloting will bring?

Andy Prendergast:

It has been a somewhat strange situation in that, as far as I am aware, the only legally required paper ballot relates to industrial action. That sometimes creates a major impediment for us taking industrial action when that is the clear view of the workforce. There was a certain irony, not lost on us, that when Liz Truss was elected, effectively as Prime Minister, that was done via an electronic ballot. We have been told consistently by people in this House that electronic ballots are not safe and secure, yet you can have one to elect a Prime Minister but you cannot have one to take industrial action. If I am absolutely honest, the state of the Post Office does not help. We often have to have a fast turnaround on a ballot. Where I live, I normally get the post about every eight days. We end up with an antiquated system that simply does not work for this purpose.

If you look at electronic ballots, the important thing is that people have the opportunity to take part in a democratic process. It is a process that is allowed under the International Labour Organisation freedom of association rules and the European convention on human rights. It is vital that people are able to partake in democracy. We believe it is something of a strange situation that the one area that currently requires paper ballots is industrial action law. If I were cynical, I would argue that that is specifically to stop industrial action taking place.

For us, industrial action is always an absolute last resort, but at times it is necessary. People do not always like industrial disputes, but when you look at what they have achieved over the years, from equal pay via Ford Dagenham to the eight-hour working day, having weekends off, and significantly improved health and safety, it is important that workers have the ability to hold their employers to account in that way. Ultimately, something that simply allows them to take part in that democratic process has to be a good thing.

Mike Clancy:

For too long, the arguments for inhibiting electronic balloting have, in my view, been entirely bogus. If you look at it from an employer’s perspective, they want the most representative turnout if they have a trade union in their midst, particularly in the context of difficult circumstances where industrial action may be in contemplation—and so does the trade union. We want a representative turnout, and we also want to be able to send a clear message if we get to a juncture where bargaining or something else in the process is proving to be difficult.

Electronic balloting is going to enable exactly that. The idea—this is where I feel the argument has been very bogus—that it cannot be done securely is in the face of all the evidence to the contrary. The sooner this particular clause can be progressed and made real, the better. Clearly, it will improve not only engagement, but the validity of results, and I believe that is absolutely something that trade unions want. The sooner we can do it, the better.

We have heard a general consensus breaking out around fire and rehire, but part of one of the clauses in the Bill has a bit of a loophole, to put it bluntly—“likely” financial difficulties. We have heard already today, and we heard on Tuesday, that that could be a back door for employers. I would like to hear your views on that more generally, but, Andy, you raised the situation with statutory sick pay. The witness from the Resolution Foundation was asked earlier today whether the Government have gone far enough, and he said that they have only gone “halfway”, in particular because statutory sick pay currently stands at £116.75, which is less than one fifth of the average weekly wage, and it has halved since it was introduced. It is the lowest of all the OECD countries. I want to ask both of you if that is something you want to see improved in the Bill, because there is no mention of any increase whatsoever.Q

Mike Clancy:

I am sure we will both have our views on the subject, but on fire and rehire, this is the space in which some of the most egregious employer behaviour has played out—behaviour that probably most in the business community look away from, because it is not the way they want to conduct their business with their workforces. We therefore absolutely welcome the fact that the Bill focuses on that dynamic. It has no place in good employment relations. But of course there has to be a space in which you evaluate, if an employer has a genuine financial challenge, whether it has some form of defence in that regard.

I cannot emphasise enough—in a way, this is not seen enough in the national media, on social media and so on—that day in, day out, trade unions solve problems with employers. They face difficult business circumstances at times, and they work with employers, communicate with their members and the workforce, and come out with some form of proposition that goes some way to resolving the issue. Therefore, the number of times that employers should fall foul of these provisions should be very small. If you conduct your engagement with your workforce either through a trade union or workforce representatives and in compliance with the law, and you are not seeking to evade your responsibilities—you see the importance of open book and sharing the finances, because that is all part of keeping the workforce engaged —this is really a minimum platform to deal with the employers who might sit on the extremes. I think it is very important that this has been addressed. It is sending a message about how we should do business around here.

Q Can I press a little bit further on that, Mike? I understand that there should be some room for employers who are under extreme financial stress, but the employers we have looked at so far—British Airways, P&O, British Gas, Douwe Egberts and Tesco—are not small companies. They have deep, deep pockets. They could exploit this loophole in the Bill. I wonder what you think about the language and whether it needs to be tightened or removed completely.

Mike Clancy:

We will be going through clause by clause, will we not? We will have to look at where there is potential for employers to exploit these sorts of loopholes. What you have to understand is that often in employment relations, sensible employers read the writing on the wall. The rights of access may or may not come in for some time, but employers will think, “Right, we are moving into an environment where we need to engage with our workforce differently.” Other employers will say, “Look, that sort of behaviour is frowned upon in public policy. We are not going to go near it.” I do not think we should lose sight of the direction that the Bill sets on these matters. Let us be clear about the context. This is a big endeavour, and there will be detail to work through for both employers and trade unions. I think we should set out on this in the way that we mean to go forward. Let us do it co-operatively where we can.

Andy Prendergast:

Just following up on fire and rehire, I was involved in resolving the British Gas dispute, where close to 500 members of ours got fired because they would not sign a new contract. At the time, it was roundly condemned across the House. The Prime Minister at the time got up and said that it was dishonourable, and that has very much been our view.

The real concern for us, as Mike says, is that, as trade unions, we sometimes have to make very difficult decisions. Following 2008, I would go into factories to negotiate pay cuts to keep people in work. It was heartbreaking, but we had to do it because it was the right thing to do. Overwhelmingly, we had those conversations not because of fire and rehire, but because, ultimately, we could convince our members that that was the best way of securing their jobs. We did something similar during covid.

The big issue for us is that if you look at British Gas, it is a highly profitable company and it went down a route that was, frankly, disastrous for it as a business and that it is still recovering from. We need to stop that behaviour happening. A contract is a contract. In this country it is almost your word, and if you are willing to break that it asks questions about whether you went into it honourably in the first place.

Some of the points you make are right. We have seen lots of financial engineering. We see inter-company debt. I think there is a concern long term that we may find cases where companies have engineered a financial position that allows them to do something they otherwise would not. That will have to be dealt with on a case-by-case basis. Where we have collective rights, we can still take action on that when we need to. This Bill takes a significant step in the right direction towards a point where the expectation is that contracts are honoured and that companies are prevented from boosting profits at the cost of their workforce.

On the SSP point, as a trade union we are used to negotiating improvements. Occasionally we cannot let perfect get in the way of good. I am pleased that we are talking about an improvement on SSP. Does it go far enough? I do not believe it does. I think that will have to be looked at long term. There are huge areas, such as care, where it is catastrophic that people do not feel that they can take time off, and, as I said before, that has a real impact, but at the moment I am happy that, for once, we are talking about an improvement to this. Personally, I am always of the view that we bank it and move forward.

This is a question particularly for Mr Prendergast. What do you think will be the impact of reinstating the school support staff negotiating body—a measure that your union has long called for—on your members in schoolsQ ?

Andy Prendergast:

When you look at the school support staff negotiating body, this is something that has been on the agenda for about the last 25 years. We have found overwhelmingly in schools that teachers have national bargaining and very clear terms and conditions that are vigorously enforced, but unfortunately for the support staff, it is almost like the soft underbelly. So often when schools enter financial difficulties, heads—when you read the school returns, they have often given themselves quite large pay rises—end up cutting hours and pay from some of the lower-paid people.

Over the last quarter of a century, we have seen a transformation in what schools are like. Most of us remember schools having one teacher and that was it. Now, we see increasingly more pupils with special educational needs go into mainstream education, and they need that additional support. People from vulnerable backgrounds get the support of teaching assistants, and we have seen educational outcomes really improve off the back of that.

For us, particularly as we see more and more academisation and more and more fragmentation, we often find that there is an undercut-and-poach approach from different schools, which ultimately means that one benefits at the expense of another. It is not helpful when we get into that situation. The school support staff negotiating body allows for minimum standards and the extra professionalisation of roles, which really have changed over the last 25 years. Originally, there was a little bit of a stereotype that teaching assistants were there to clean paint pots and tidy up. Now, they do very detailed work on things like phonics and supporting pupils with special educational needs and disabilities, and they really help to deliver classes. I think it is time that professionalism was recognised and rewarded.

I think that you, like all the other witnesses from the trade unions, were quite pleased with the Bill, and understandably so. I know you said that you felt shut out over the 14 years of government until the general election. I want to ask about your engagement with the Department and with Ministers, and indeed with No. 10. How many Q meetings have your organisations had with officials, special advisers and Ministers, and were you involved in any of the drafting of the clauses of the Bill? Did you see any in advance before publication, and that kind of thing?

Andy Prendergast:

Personally, I was involved in two meetings, and they were tripartite ones. They were quite robust exchanges where we had Ministers, civil servants, people from the employers’ associations and large employers, and also people from trade unions. I think those meetings were really quite helpful. We were raising points that sometimes they would argue with or agree with, and they raised points that sometimes made us look at things differently.

In the wider sense of the union, we have had quite a lot of engagement, but I would expect a union to be engaged over a Bill that has a huge amount of clauses about trade unions. In terms of whether we saw any of it in advance, no. We were very much holding our breath when the Bill came through. Part of my job is to tell people things and make cases, and to be told that they have heard, and then something comes out that is the complete antithesis of everything that we talked about.

As I said, we did not see the Bill in advance. When it turned up, there were some things we liked an awful lot. Some things, as we said beforehand, did not go far enough. The majority of engagement was tripartite, and I think both ourselves and the business organisations that have taken part in that process have helped understand it, and we have got to something we can all live with. That is certainly our impression.

Mike Clancy:

I would just emphasise that Prospect is not affiliated with a political party, so any comments I make are based on evidence of the past and the present. We have had proportionate engagement. We have not kept a count or a register in that regard. Frankly, probably trade unions and business would want more and more time on this, and I am sure that will be a challenge going forward.

What I think was most positive, and something I had not seen in my career before, was a tripartite meeting with a range of very senior business representatives, trade unions and civic society with officials, the Business Secretary and the Deputy Prime Minister back in August. That is important because it demonstrates that we can get in a room, we can talk to each other and we can resolve problems. That, for me, is the absolute core of this Bill and the “Next Steps to Make Work Pay” agenda. I hope that we can do more of that. I have talked a lot—I have had the privilege of doing this job for a long time—about how we have lost convening spaces in the economy in the past period, so we may be shouting over fences or making our cases separately to Government. Government is difficult, and it is about problem solving. The more that business, trade unions and civic society can come together and say, “Look, we’ve got our differences at the edges, but we can do this together. This is how we would fashion an outcome within the public policy you set,” the better. We will always want more, but to be fair, with their strong pace and intensity, the Government and their supporting officials have done an admirable job in convening us.

Thank you very much. I am afraid that we now have to go on to the next panel of witnesses.