Get ready for some serious dialogue
As compliance with the new Information and Consultation of Employees Regulations comes closer, what should employers have in place? By Amina Ali, a barrister in the litigation and employment department at Jeffery Green Russell Solicitors.
The Information and Consultation of Employees Regulations 2004 will undoubtedly be a major challenge to many private employers who are not used to dealing with a workforce on a collective basis.
The regulations come into effect on 6 April 2005 and will initially apply to undertakings with 150 or more employees. However, in April 2007, the regulations will extend to organisations with 100 or more employees and from April 2008, they will apply to undertakings with 50 or more employees.
The regulations provide employees with the right to be informed and consulted on an ongoing basis about a wide range of business issues which affect their employment. However, the information and consultation procedures do not apply automatically. At least 10% of employees (which should not be less than 15 and not more than 2,500) must make a written request ('employee request') to negotiate an information and consultation agreement. If no employee request is made, then the employer can choose whether or not to implement an agreement.
If an employee request is received, the employer must put in place one of the following:
Pre-existing agreements
A pre-existing agreement will need to comply with Regulation 8(1) to be valid. This means it must have been agreed before an employee request is made. It must also:
- Be in writing
- Cover all employees of the undertaking
- Set out how the employer is to give information to employees or their representatives and to seek their views on such information. The parties are given the freedom to determine the subject matter, timing, method and frequency
- Be approved by a majority of the workforce.
Negotiated agreements
If an employee request is made, the employer will be obliged to try to reach a negotiated agreement on the information and consultation procedure. If there is a pre-existing agreement in place, the employer must either enter into negotiations to agree a new procedure or put the continuance of the pre-existing agreement to a ballot. The pre-existing agreement can only be discontinued if it does not comply with the statutory requirements, or by at least 40% of the workforce, plus a majority of those who vote.
The employer must inform the employees within one month of the employee request being made if it intends to hold a ballot, and the ballot should be held no later than 21 days after notification. Negotiations on the agreement should begin as soon as possible, but no later than three months. Negotiations will be carried out by negotiation representatives.
There are no fixed rules on how a representative is appointed, but employers should ensure all employees are involved in the electing process. Negotiations can last up to six months, but this time limit can be extended by mutual agreement. A valid negotiated agreement must:
- Set out the circumstances in which employers will inform and consult their employees. The parties are given the freedom to determine the subject matter, timing, method and frequency
- Provide for the appointment/election of representatives or to inform and consult with employees directly or both
- Be in writing and dated
- Cover all employees in the undertaking
- Be signed by or on behalf of the employer
- Be approved by all the negotiating representatives or majority of the representatives and approved by at least 50% of the employees, in writing or by ballot vote.
Standard provisions
If there is no valid pre-existing agreement or the parties fail to reach a negotiated agreement, then the employer must follow the standard provisions set out in the regulations.
This requires the employer to inform and consult on:
- The recent and probable development of the undertaking's activities and economic situation
- The situation, structure and probable development of employment within an undertaking and on any anticipatory measures envisaged, in particular where there is a threat to employment
- Decisions likely to lead to substantial changes in work organisations or contractual relations.
Once agreement has been reached, employees will be prohibited from making any further employee request to renegotiate the agreement for three years.
Employers should have a pre-existing or negotiated agreement in place as this gives the parties the scope to determine what issues to inform and consult the workforce on, rather than be subject to the standard provisions, which may be far more onerous for the employer.
