Union recognition law may inhibit growth of small firms, warns FSB

Small manufacturers could be inhibited from growing by trade union recognition rights due to come into force next week, according to industry leaders. The Employment Relations Act, set to become law on 6 June, will make it easier for trade unions to gain recognition in previously non-unionised firms with 21 or more employees. The Federation […]

Small manufacturers could be inhibited from growing by trade union recognition rights due to come into force next week, according to industry leaders.

The Employment Relations Act, set to become law on 6 June, will make it easier for trade unions to gain recognition in previously non-unionised firms with 21 or more employees.

The Federation of Small Businesses warned that manufacturers on the cusp of the regulation – those with around 18 or 19 employees – will think twice before increasing staff numbers.

Peter Martin, director of employment policy at the Engineering Employers’ Federation, said: `Some small companies are concerned about having to deal with a trade union, when they’ve never had the experience.’

The organisation expects a focused campaign of claims once the legislation comes into force, with unions targeting those companies where they stand a high chance of success.

But he added that union membership and recognition has always been higher in the engineering sector than in other areas. `I don’t think we’ll see an avalanche of claims,’ he said.

The Trades Union Congress said recognition agreements had increased recently, as companies rushed to sign voluntary deals before the act comes into force.

Sir Ken Jackson, general secretary of the Amalgamated Engineering and Electrical Union, said the act could increase the number of deals between unions and employers. `We have a large number of agreements and the new act won’t affect those. But it will encourage firms that do not recognise a union to think about partnerships,’ he said.

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