Trade Unions Should Learn from Francis Maude’s Attack on PCS Union

Eric Pickles - the first Secretary of State to attempt to remove Check-Off in the DCLG.
Eric Pickles – the first Secretary of State in the UK Government to attempt to remove Check-Off in the DCLG. He failed.

Unions in the Civil Service face a herculean task in needing to get each and every union member to effectively re-join their union following Francis Maude’s pressure to withdraw the ability of union members to pay their subscriptions direct from their salary. The challenge is one other unions can learn from. 

In his article for Civil Service World on the challenges currently faced from the Cabinet Office’s campaign to attack independent trade unionism in the public sector Mark Serwotka describes the challenges to trade unions well.

Serwotka writes:

In the dying days of the last Labour administration, I said if you judged a government by how it behaves as an employer, it was the worst we had ever known. But let there be no doubt, this current crop of ministers – who I hope, come May, will all be following in Francis Maude’s footsteps, packing boxes and saying their goodbyes to staff – have far outdone their predecessors.

Look at their civil service record. Ninety thousand jobs gone; pay and pensions cut, causing living standards to fall by up to 20%; redundancy terms slashed; working conditions rolled back; a hated and discriminatory performance management system; and more politicisation of the senior ranks.

Inseparable from this is the treatment of trade unions. We know how much further the Tories would seek to restrict union rights if they are re-elected. They have already cut facility time – which we also know benefits employees, employers and the wider economy – and, since 2010, they have degraded industrial relations beyond recognition. In the name of austerity, budgets and remits are so tightly controlled that the fiction of delegated bargaining plays out as both comedy and tragedy.

But it is the move against my union’s finances that is the real give-away. After Eric Pickles’s failed and costly attempt in communities and local government in 2013, the Home Office was the first major department to confirm its withdrawal late last year, followed by the Department for Work and Pensions. These hasty removals only make logical sense in the context of the general election. Tory ministers, fearing defeat, want to do as much damage as possible while they still can.

Despite the fact many large UK companies still use check-off because they recognise it is efficient, Maude claims there is nothing untoward about his mission to remove it. And in a frankly bizarre twist of reality, he has cited the fact we are signing up our members to pay by direct debit – a Herculean task to effectively re-recruit at short notice tens of thousands of people – as evidence that we agree with him.

But if there is no political motive, there is no rush. If it is more appropriate for a union to collect its own subscriptions, we could reach an agreement for a smooth transition over time that would not leave us out of pocket. That is, quite obviously, not what is happening.

There is little doubt that the move is intended to target organised labour in the UK Civil Service. When the removal of Check-Off was first attempted by the Department of Communities and Local Government (DCLG) led by the Conservative minister Eric Pickles the rationale was financial. The costs of administering the fund – estimated at £300 per union – were purported to be an unfair burden on UK taxpayer’s. In his attempts to save £300 a year for the UK taxpayer Pickles incurred legal costs – paid for by the UK taxpayer – of £90,000 after PCS successfully sought an injunction against the decision on breach of contract grounds. When consultations were ongoing PCS actually offered to meet the costs of the check-off system from the government so there is no question that the decision was not based on finance, as the Lib Dem Treasury Minister Danny Alexander himself more recently confirmed.

If not finance then what? It is I think simple – without an organised trade union it is all the more easy to push through detrimental changes in terms and conditions. This also explains the government’s eagerness to split the the collective voice of members (e.g., by granting Unison recognition rights), sidelining recognised unions from collective negotiations as proposed in HMRC, and supporting the establishment of staff association such as that in SOCA.  And, by moving to directly to remove check off, and therefore impact on the ability of the union to meets its financial obligations Francis Maude may have hit upon the most effective means of threatening trade unionism in the civil service.

However, as early as 2012 DCLG were urging local authorities to remove check off (emphasis added):

18. Some employees who are trade union members pay their union subscriptions by deduction from their pay at source. The money is then passed direct to the union by their employers. Employers are not required to provide this facility – known as‘check-off’ – or to keep making such deductions indefinitely.Where employers do choose to provide this service, they may also choose to charge the union for the administration involved in doing so.
19. Many councils seek to recover the cost of providing ‘check-off’ facilities by charging trade unions a proportion of the value of the fees collected – for example, from 0.5% to 5%. We consider that charging for collecting trade union subscriptions is one example of sensible savings that can be made in local government. Alternatively, local authorities have complete discretion to terminate such arrangements, and allow trade unions to adopt their own ways of collecting subscriptions (e.g. bank Standing Order or Direct Debit).
In point of fact, as DCLG was to find out, the claim of “complete discretion” for local authorities was misleading. In Hickey and Anor v Secretary of State for Communities and Local Government [2013] All ER (D) 24 the court decisively found the far from having “complete discretion” the decision of the department to withdraw checkoff was in actually in breach of contract.
But that decision has not dissuaded the Conservatives, cheered on by the likes of Conservative Home, from pushing through the removal of check off in departments even though there may be a contractual right to have deductions of union salaries direct from their salaries as there was in Hickey. 
But we are where we are. And as we face the prospect of new administrations in Local Authorities – and, sadly, we can’t rule out that some Labour led councils will not follow suit – there is every prospect that the battles that have beset PCS will be replicated across the UK in local authorities where check off remains. And so, in no particular order, here are some observations for other unions that may face these same challenges in the months ahead; they are all in fact quite straightforward and commonsensical:
  1. Study your contracts of employment – In PCS I think, even with the important win in Hickey we have been too reticent in pursuing breach of contract or JR proceedings. A robust, prompt and publicised legal challenge would have sent a message to other department and give pause for thought for some departments; although such a challenge is still possible it is in some already sense too late – the decisions have now already been made. So the advice is plan a case now – hopefully you won’t need to lodge it but if you do have your evidence lined up and get the case in early. One or two early wins could stop prevent a domino type run of check off withdrawal.
  2. Talk to the members – and non-members. This sounds any obvious one but the decision meant we have had to get out to members where they worked and engage directly with their concerns, essentially we had to recruit them to the union all other again. Do not rely on emails, sadly most members simply to do not read them. And don’t forget the non members too – the campaign to re-sign members to the union was also a boon for recruitment figures as thousands of new PCS members have joined the union.
  3. Don’t screw over your allies – employers have their ploys to undermine the union voice in a workplace and one of these is to play off one union against the other. Don’t fall into the trap and allow yourself to be a tool in someone else’s war. I will post more on this later but while here it was Unison taking the thirty pieces of silver Maude offered them and accepting union recognition (against a fair number of objections from the Unison ranks but which others had been advocating) there is no reason other employers will not use – for example – GMB to undermine Unison etc in other local authorities across the UK. Solidarity should be something unions live and breathe. The tactic was clear, encourage members to ‘union shop’ and so reduce the collective voice of workers as members are faced with the conscious decision to maintain their union membership.
  4. If you recruit new members onto check-off then stop. As the threat to check off became clearer PCS changed its application forms to only accept new applications with a direct debit mandate, even if an applicant’s employer allowed check off. In due course there will be a debate in PCS about whether the NEC (or, more likely, previous NECs) were too slow in making this change, but that is a debate for another day. However, a look at my branch records would reveal that had such a decision been made at the time the Conservatives came to power then the branch sign up rate to direct debit subscriptions would have been around 25% rather than the less than 5% it actually was when a decision to remove check off was announced. I cannot emphasise enough how much of a headstart that 20% would have made made to our organising efforts. So, if you allow new members to join onto check-off stop it now. Quite apart from anything else the industrial logic of having a union’s financial security in the hands of an employer they sometimes find themselves at loggerheads with is negligible at best!

Mark Serwotka Responds on Suspension of PCS Union Elections

Serwotka's response to legitimate questions of union members leaves a lot to be desired.
Serwotka’s response to legitimate questions of union members leaves a lot of questions unanswered.

The decision of the PCS Union’s National Executive Committee to suspend the union’s internal democracy as it relates to elections for the NEC and group committee is understandably a very contentious one; it is also one I disagree with as I have set out before.

One PCS branch, the Bootle HMRC branch (I am sure there have also been many others) wrote to the Union’s General Secretary asking a number of questions about the decision. The letter send can be read here, but the letter begins with a comment criticising the decision on the basis of the lack of consultation and then proceeds to ask two questions:

  1. The branch asked, noting that legislation requires only the NEC election to be conducted by means of a postal ballot why the NEC felt there were no alternatives to reduce the costs of the election in the other ballots (for example, by holding an electronic ballot); and
  2. The branch also asked why the NEC had relied on a supplementary rule of the union to suspend elections that are required by a Principal Rule of the union when these Rules require that in the case of any conflict it shall be the Principal Rule of the Union that shall take precedence.

These are not unreasonable questions.

On 27 February Mark Serwotka responded to the branch, the letter is available to read here. Readers can have of course make their own minds up on Serwotka’s response but to me it fails to really grapple with the questions that were posed to him. No one is going to disagree that the attack is an ideological one, particularly given the PCS’ offer to fund the running costs of check-off, a point reinforced by Danny Alexander’s “no fiscal case” letter to Permanent Secretaries sent from the Treasury.

But Serwotka’s response, in detailing the time line doesn’t answer the question why the NEC felt it had no alternative but to suspend elections with no consultation. He has said clearly that the decision was not a surprise and that this issue was a constant one through the last year; it was surely right for the union to politically campaign to avert the possibility of check off being removed but his answer seems to come down to the following: we couldn’t consult because we didn’t know how many people would switch and so, and I infer this (it is not set out clearly) therefore the union did not know what the financial implications would be for the union until we had gone through the process in one department, namely the Home Office. With that information the union could set a benchmark for what kind of income loss the union could reasonably expect. An accurate assessment was always difficult but, as Serwotka has said elsewhere, this was always a “herculean task” and other union’s faced with such a threat have consistently fared less well than PCS have in retaining over 70% of its membership. Therefore, it seems to me that with the real prospect of a withdrawal of check off there were good reasons for believing the financial pressures on the union would be worse than they actually now are. Consulting members earlier on the financial situation and actions the NEC would consider as a result of this would then seem to have been a more responsible course of action.

There may be a reason why earlier consultation with branches was not practical, even though there was a clear financial threat to the union that was known for a long time (e.g., negotiations behind the scenes in confidence). However, if there was it is not one Serwotka has explained here. I am also conscious that I am criticising Serwotka’s reply but in fact he was for significant periods – quite reasonably due to ill-health – not available to lead the union and so the blame for this failure to consult does not rest with Serwotka himself.

On the question of what other thoughts were given to other forms of elections which would be less costly there is, as far as I can see, no response given.

In respect of the second question what is noticeable is that there is no real attempt to answer the question at all. It would have been quite easy to answer to say this is a complex matter but the union sought legal advice who advised that their proposed actions were lawful and while regrettable felt the NEC had to take the course of action it did. Instead, it failed to engage on the question of the Union Rules at all – that failure to address the point at issue is itself quite telling.

Why trade union elections are expensive

The reason the PCS Union NEC cancelled suspended elections this year is because of the financial cost. The figure given is that the cost to the Union is £590,000, it is not known how much of that comprises the cost of the NEC elections. Let us say however, that it is £300,000 (half the total).

In this post I want to set out why these union elections are expensive. It is PCS policy that all lay posts shall be elected annually, this includes the entire NEC, including the Union President. That is not a statutory requirement, which requires that these posts must be subject to election only once every five years (as the Union’s General Secretary and Assistant General Secretary are). The requirement for the Union’s President to be elected at least every five years is set out in section 119  of the Trade Union and Labour Relations (Consolidated) Act 1992. This requirement applies irrespective of any requirement in the Union’s rules.

In addition, each member of the Union’s executive, meaning “the principal executive committee of the union” (and, like Highlander, there can be only one) which in PCS is the NEC must also be elected once every five years.

It is of course right that unions should hold elections and holding elections five years seems a reasonable maximum period, particularly given it now concurs with the interval between General Elections. But the 1992 Act does not just require elections but requires that these elections (namely, the election of the NEC) shall be conducted by means of a postal ballot (Section 53, TULRCA 1992) and be subject to independent scrutineers (Section 49, TULRCA 1992).

When enacted trade unions (in the Trade Union Act 1984) were able to receive a partial refund on the costs of these undoubtedly expensive elections. In 1993 that partial refund was abolished by the Conservative government.  So, since 1993 trade unions have had to bear the full cost of all statutory ballots it is required to take.

Although the requirement to hold statutory elections only requires five-yearly elections (which would require an outlay of c. £300,000 on the above figures, or by my reckoning £0.73 per member) because PCS’ constitution requires annual election that outlay increases to £1.5m over five years.

This is a very high cost for elections, and much higher than necessary. It is entirely possible, as the TUC have argued in the context of strike ballots which operate on similar restrictions, to run independent scrutineered ballots and much lower costs than that required by the 1992 Act that would also increase turnouts. So, although Jon Rogers may be right that the PCS NEC’s decision is a gift to the Tories, it remains the case that they could have made legislative changes that would have increased worker’s engagement in workplace democracy but have chosen not to.

There is certainly a question of procedural injustice here – a union, like PCS, that has an explicit policy to be far more democratic than the statutory minimum (5 elections held where only one is required by legislation) is given a significant financial obligation (in PCS’ case approximately and additional £1.2m over five years) by needing every NEC election to be conducted by postal ballot. Any political party professing to support workplace democracy needs to address that.

In short, none of the above alters the fact that PCS’ rules require annual elections and the NEC have made a decision to not abide by that requirement this year but the pleadings that the elections are a significant financial burden certainly has merit. And that requirement is required by the UK’s industrial law – the NEC could have made a decision to run an election on a non-statutory basis but that would, in all likelihood, have caused even more of a financial burden and, possibly, have spelt the end of the Union.

However, as others have pointed out these onerous requirements only apply to the principle executive body of the union, and not subsidiary bodies such as Group Executive Committees. Here, there is no legal requirement for any election to be postal. It is unclear why the NEC did not decide that group elections could not be made by workplace balloting or by much more cost effective digital voting platforms.