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DAVID MANGAN UNIVERSITY OF LEICESTER No Longer; Not Yet: The Promise of Labour Law.

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Presentation on theme: "DAVID MANGAN UNIVERSITY OF LEICESTER No Longer; Not Yet: The Promise of Labour Law."— Presentation transcript:

1 DAVID MANGAN UNIVERSITY OF LEICESTER No Longer; Not Yet: The Promise of Labour Law

2 No longer; Not Yet Labour law has become a source of lament insofar as its contemporary form resembles little from a few decades prior and, simultaneously, offers tantalising morsels of hope that it will have better days ahead. Examples of change are numerous but landmark movement is absent.

3 The Promise of Labour Law The fact that labour law relies on potential developments in a way that many other areas of practice do not confirms a basic fact: the law is most malleable where it concerns economic interests and people at work. The idea of labour law has been largely subsumed by the imperative of economic viability. And yet, the hope of better days remains alive, if in a sometimes muted form.

4 The unproductive view of English workers Complaints about economic duress (the perceived unfair influence of trade unions by way of industrial action) were part of the movement that brought about the decline in collective labour law and it is being used again today. The assertion of economic duress is the motif that runs through the more recent history of labour law. Two examples of recent challenges to the promise of labour law will be discussed. 1. The employment tribunal reforms passed in 2013 were premised on the idea of improving the economy. 2. The challenge posed by social media is explored insofar as it relates to the touchstone of business reputation. Threatening to continue the ‘not yet’ era of labour law, these two examples demonstrate how the imperative of commercial viability has been so pervasive as to dictate how adjudication should be undertaken.

5 Tribunal Reforms: A response to Duress Economic duress (not the legal concept taken from contract law). Rather it is the term in a non-legal sense. Employment tribunal claims launched by workers are viewed as an economic drain for two reasons. 1. it is too easy for claimants to bring a claim; and 2. once claims are made employers incur costs.

6 Current Motivations for Reform 67% of employers believe employment regulation is a barrier to the UK’s market competitiveness. But this is down from 77% in (26) 34% of claims withdrawn by applicants.(25) Employers 4 times more likely to win but 26% are still settling even when told they can win (25) Facing the Future: CBI/Harvey Nash Employment Trends Survey2012 (July 2012)

7 Current Motivations for Reform Private sector per hour labour productivity is at about 8% below its pre-crisis peak. The measurement is based on comparison with the highpoint of 2007 Quarter 4 figures. The danger in looking at the predicament as one of low labour productivity is that it easily falls into a theme which in England has a long history – worker lethargy and its associated ills. Bank of England, Inflation Report (August 2013)

8 Fees for claims The Employment Tribunals and the Employment Appeal Tribunal Fees Order 2013 (in force 29 July 2013). A claim for unfair dismissal is a Type B claim and would cost a worker £1100 in order to get to an employment tribunal hearing (filing and hearing fees). On top of this, there are representation costs. BIS estimates employment tribunal hearings cost claimants about £1800 and employers £6200.

9 Fees for claims If the worker loses the case and wishes to appeal, she would pay £400 for a notice of appeal and £1200 for an oral hearing. If the worker wins her case, r.78(1)(c) of the 2013 Regulations permits ‘reimbursement’ for all Tribunal fees within a costs order.  To this we should add the 8% success rate for unfair dismissal claims. If she loses after appeal, she will have paid £2700 for administrative costs alone, plus any representation fees as well as the potential for costs being awarded against her. The challenge with these reforms is to see them as anything but a disincentive for workers to launch a claim in the first place.

10 Fees for claims The most difficult measurement is also the most important. It is unclear how we can measure the impact of the disincentive to launch a claim. We can speculate that the number of claims will decrease.  Underhill – ‘powerful disincentive’ Is the probability of positive developments diminished with a decrease in claims?

11 Authoring the definitive narrative British workers are characterised with the kind of savvy understanding of employment law which (it seems) evades employers. Section 65 of the ERRA has repealed s.40(2)-(4) of the Equality Act which allowed for third party liability for harassment at work.  ‘The legislation clearly creates a temptation for workers to conspire with each other or with customers to create a harassment situation which might result in substantial financial compensation from their employer’ (Beecroft 6) The description ascribes a high level of deviance to workers as a class and to an extent that it tests the boundaries of credibility.

12 A troubling shift in focus Small to medium-sized firms accounted for a combined 48% of UK private sector employment: BIS, Small Business Statistics (2010) There are two important facts which prompt questions about the wisdom of regulating for this cohort. 1. SMEs prefer to have an informal workplace; that is, few if any formal written policies. 2. Consequently, this choice exposes them to greater potential liability at employment tribunals for the absence of formal procedures. It is interesting to note the difference in attitude.

13 Regulating for SMEs The difficulty with the Government’s benchmark of SMEs is that while much may be done to benefit them, SMEs are most likely to be unaware of this largesse. ‘There was no evidence that these employers were aware of the increased qualifying period for unfair dismissal’ (Jordan et al, 29). Aimed particularly at SMEs, regulation of employment is now supposed to permit employers to adapt to the fluctuations of the economy so that they may ‘hire people to meet new challenges, knowing they can reduce the size of their workforce if economic circumstances require’ (Progress on reform, 7).

14 Regulating for SMEs Economic pressures do not obscure the significant challenges to access to labour law redress posed by these reforms nor should the on-going flow of individuals to the unemployment lines be overlooked. The effect of these amendments may not be readily noticeable for some time. The shift: a movement away from dispute resolution to coerced conflict management leveraged in favour of employers.

15 Big Society and SMEs In essence, SMEs have been asked to band together to solve workplace issues. With pilot mediation projects (in Cambridge and Manchester), it is apparent that the idea is to create a pool of mediators suggesting that these trained individuals will service an area.  When will these mediations occur?  Will these employees be asked to mediate outside of work hours?  Will they be paid for conducting mediations?

16 Social Media A new frontier for labour law Trade Union A writes on its FB wall: ‘Employer X [a non-unionised company] is planning reductions in staff. Workers at this company should know their rights. Contract us if you want some information.’ Worker B at the same company ‘likes’ this posting and writes in support: ‘We cannot process this amount of work despite our company motto – ‘quick and efficient’ How can they cut jobs?’ The company has a social media policy prohibiting comments by workers causing offence or bring the company into disrepute.

17 Inducement of breach of contract The issues when assessing the facts against the criteria for the tort include: whether providing information or advice would constitute inducement and whether there was an intention to induce a breach of contract.

18 Social Media A new frontier for labour law American Medical Response of Connecticut, Inc v. International Brotherhood of Teamsters, Local 443 Case No 34-CA (27 October 2010) [Souza]. A client of (AMR) complained about the social media posting of its employee Dawnmarie Souza. The employer asked her for a response but she was refused (by her supervisor) the opportunity to have assistance from the union in preparing the response. To voice her displeasure, Souza made several vulgar entries on her Facebook page in order to ridicule her supervisor – for example she identified him as a psychiatric patient. The posting elicited supportive comments for Souza and further negative commentary about the supervisor. AMR terminated Souza for violating its policy prohibiting any depiction of the company on social media. The NLRB supported Souza’s case as it took the view that criticisms on social networking sites about an employer constituted protected activity under s.7 of the US National Labor Relations Act.

19 Chilling Effect Social media poses a further challenge to labour law. The law permits employers to take measures to protect their business reputations. Social media is another facet to this same issue. The distinction for workers is that employers can curb freedom of expression, namely about workplace issues, through open-ended social media policies. A social media policy (and tribunal/court decisions which legitimate them) can have a distinct chilling effect on speech regarding British workplaces. This in turn can undermine the role and long-term place of labour law.

20 Must be doing something right Hope is embodied in those who work in this area (academics, practitioners and unions).


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