New laws to facilitate minimum rail transport services levels during strikes

Key points

• New regulations will set minimum service levels (MSLs) for essential industries including rail transport during strikes. For heavy and light rail train operation services, the MSL will be 40% of the operator’s timetabled services, and for heavy rail infrastructure services the MSL will be that priority routes and certain other nearby parts of the network are kept open between 6am and 10pm.
•  Employers will be able to issue notices to trade unions requiring workers to work despite a strike if their work is needed to achieve the prescribed MSL.
• If a trade union does not take reasonable steps to ensure that employees comply with the requirement to work, the trade union will lose its statutory immunity from claims for inducing or procuring a breach of contract, liability for which is up to £1 million for the largest unions. Employees will also lose some of their protection against unfair dismissal if the union does not take reasonable steps or if they participate in a strike in breach of a work notice.

Background

In recent years Britain has been affected by a significant number of strikes across the economy, including in critical services. According to the Office for National Statistics a total of 2.472 million working days were lost between June and December 2022, and of these, over three-quarters (79%) came from workers in transport, storage, information and communication. According to a government impact assessment prepared in February 2023, Department for Transport’s internal records showed that 160 disputes had been lodged by trade unions against employers within rail since 2019, and that since 2019 there had not been a single day where there had not been a mandate for strikes outstanding.

The government has sought to find ways to mitigate the effect of strikes on individuals and the economy, and in July 2023 the government passed the Strikes (Minimum Service Levels) Act 2023 (MSL Act) which allows the government to set MSLs across essential services and contains a mechanism to allow employers to compel employees to work during the strike to meet the MSL.

Where a MSL applies and a strike is called relating to the provision of that service, an employer may give a trade union a "work notice". The work notice tells the union that MSLs are to apply in relation to that strike. The notice must identify persons required to work during the strike in order to achieve the relevant MSL and specify the type of work they are required to carry out in order to achieve the MSL. A work notice must not identify more persons than are reasonably necessary for the purpose of providing the levels of service under the minimum service regulations.

Before issuing a work notice the employer must consult the union about the number of persons to be identified and the work to be specified in the notice and have regard to any views expressed by the union in response. In deciding whether to identify a person in a work notice, an employer must not have regard to various matters including whether or not the person is a member of a trade union and whether or not the person has taken part in trade union activities or made use of trade union services.

If an employer gives a trade union a work notice under the rules and the union fails to take reasonable steps to ensure that all members of the union who are identified in the work notice comply with the notice, then the trade union loses the statutory immunity it might otherwise have from claims for inducing or procuring a breach of contract (i.e. a breach by the employee of their contract of employment, which could be the case if the union asks the employee not to work when they are obliged under their employment contract to work). The potential liability for these types of claims was increased in 2022 up to £1 million for the largest unions. The government has been consulting on a draft statutory Code of Practice on the ‘reasonable steps’ a trade union should take to be compliant with the legislation. The consultation closed on 6 October 2023, and a government response is awaited.

The new regime also has consequences for individual employee rights. If a union fails to take reasonable steps, then employees taking part in the strike (even if not identified in the work notice) would also lose protection from automatic unfair dismissal. If an employee has been given notice of the work they are required to carry out and the fact that they are identified in the notice and must comply with it, and that employee takes part in the strike anyway, they will lose their protection against automatic unfair dismissal. Employees who lose their protection against automatic unfair dismissal may still have ordinary protection against unfair dismissal.

Application to rail services

Following the introduction of the legislation in July 2023, the government consulted on specific MSLs in the passenger rail sector.

On 6 November 2023 the government announced its response to the consultation, including the MSLs that will apply in relation to rail services.

It has published draft regulations which, in summary, set the MSLs as follows:

• Train operation services excluding light rail services: This category covers services for the carriage of passengers by railway (and refuelling of trains) undertaken by the train operating companies who provide passenger services under franchise agreements awarded by the Secretary of State or Welsh or Scottish Government, as an operator of last resort in England, Scotland or Wales, under agreements with a passenger transport executive or local transport authority, or under agreements with Transport for London (or their subsidiaries). The Explanatory Memorandum to the regulations states that train operation services for this purpose does not include open access operators and chartered services, or any sub-contractors of the train operating companies. Operators must deliver the train operation services necessary to operate the equivalent of 40% of the timetabled services during the strike, by reference to the National Rail Timetable for the strike period.
• Infrastructure services excluding light rail: This category covers specified services provided by an infrastructure manager such as the operation of track and signalling. It includes reactive maintenance, but the government has said that deliberately excluded planned/scheduled maintenance and construction: For the purposes of this category an infrastructure manager means infrastructure managers of network services as defined in the Rail Access Regulations, as well as persons who deliver all those network services on behalf of the infrastructure manager, but the government does not intend it to capture sub-contractors who only deliver some of these services on behalf of the infrastructure manager. Infrastructure services must be provided during the strike between 6am and 10pm on listed priority routes and on any part of a network within a 5-mile radius of priority routes, which consists of loops, sidings and lines which connect priority routes to places such as stabling facilities and freight terminals.
• Light rail services: This category covers train operation services and infrastructure in relation to specified light rail systems such as the DLR and London Underground. Operators must deliver train operation services and infrastructure services necessary to deliver light rail services necessary to operate the equivalent of 40% of the timetabled services during the strike affecting a light rail system. The timetabled service is the number of trains listed as operating during the strike period in the most recently published timetable by the relevant light rail operator, as of the date of the notice of strike.

The draft regulations will come into force on the day after they are made, or the time immediately after the Code of Practice on 'reasonable steps' comes into force, if the latter happens later. They will apply in relation to any strike that takes place on or after the day on which the regulations come into force, even if the notice of the strike was given before the regulations came into force, or if the date of the ballot for the strike was before the MSL Act came into force.

The government has announced that it intends for the regulations to come into force before Christmas 2023, but they need approval of both House of Parliament, so it is not yet clear whether or not the target will be achieved.

The government has confirmed that the MSLs do not alter the need to comply with the legislative regime for the provision of rail services (including safety and accessibility systems and frameworks).

Implications for employers

Once in force, the MSL regulations will give businesses greater powers to keep their operations running despite a strike and might lead to strikes being resolved more quickly. However it will change the industrial relations dynamic and could have unintended consequences – strikes could become more protracted, or there might be an increase in industrial action short of a strike.

Before issuing work notices employers should make sure that they have familiarised themselves with the scope and application of MSLs, including the scope of services to which MSLs apply and how MSLs are applied.

The MSL Act and regulations do not compel employers to issue work notices, and so where they are available to be issued employers will have to make tactical decisions about when, how and in relation to whom work notices are deployed, taking into account all relevant factors (including industrial relations context and the employer's contractual or other obligations and duties in relation to service provision).

Where work notices are issued, employers should make sure that they are familiar with the protections that employees will continue to have in relation to industrial action.

Further information

For more information of any of the issues raised in this briefing, please speak to your usual Ashurst contact or to any of the people whose contact details are given below.