Government to go ahead with strike reforms

The biggest changes to trade union rights for 30 years have been unveiled by the government. Under the new law, strikes affecting ‘core’ public services like education, firefighting, transport, border security and energy sectors will need the support of 40 per cent of union members to go ahead, and all union ballots will need a turnout of over 50 per cent for any resulting strike action to be considered valid.

CBI deputy director-general Katja Hall said: “We’re glad the government has brought forward this Bill, as the CBI has long called for modernisation of our outdated industrial relations laws to better reflect today’s workforce and current workplace practices.” The government's proposals have been criticised by unions, with TUC General Secretary Frances O'Grady saying the bill “is a slippery slope towards worse rights for all.” Paul Kenny, General Secretary of GMB warned that the proposals would “poison industrial relations in the UK since they removed all incentives for employers to heed their own workers and settle disputes.”

The National Living Wage to replace minimum wage by 2020

In the Budget this month, the Government announced the introduction of a National Living Wage next April. The National Living Wage will be a new minimum wage for employees aged 25 and over, and it will start at £7.20 and rising to £9 an hour by 2020.

This is partly to moderate the impact of in-work benefit cuts. It is a large increase from the current minimum wage which is £6.50 for those aged over 21. According to the Office for Budget Responsibility, the move is expected to boost the wages of six million people in work but the Government have acknowledged that it may have a small negative impact on employment. It marks a shift away from the traditional approach to the minimum wage which was set independently of government by the Low Pay Commission.

The TUC welcomed the Living Wage announcement but said the Chancellor was "giving with one hand taking with the other" and "massive cuts in support for working people will hit families with children hardest.” Business groups gave Mr Osborne's Living Wage announcement a mixed reaction, with the Institute of Directors saying it was "time for companies to increase pay" but Katja Hall, director general of the CBI saying: "The chancellor is taking quite a gamble by introducing a living wage…what happens if there is an economic shock?” Others have highlighted the fact that the National Living Wage will be below the Living Wage – the amount calculated by the Living Wage Foundation according to the cost of living, which stands at £7.85 an hour, or £9.15 in London.

Union crackdown could impact productivity

Joint research from professors of HR Management, Nick Bacon, from Cass Business School, and Kim Hoque, from Warwick Business School found that union crackdown could be disadvantageous to increase UK productivity. Their research, based on the government-sponsored Workplace Employment Relations Survey data (WERS 2011), proposed that reducing trade union facility time is likely to have a negative effect on UK workforces, especially in the public sector, where trade union membership is still high. Additionally, they also found that public sector staff performed better when a union representative was present in the workplace.

Prof. Nick Bacon said: “The steps laid out by the government [to change trade union rights] do not appear to take into account evidence, using data the government itself has sponsored, pointing to the positive effects that workplace trade union representatives have in the public sector.” However, Sajid Javid, the Business Secretary said: “Trade unions have a constructive role to play in representing their members’ interests but our one nation government will balance their rights with those of working people and business.”