Union mergers ‘should be probed by watchdog’

THE UK’s Competition Commission should be handed powers to investigate trade union mergers to curb industrial action, business leaders have said.

Trade union Unite was formed by a merger of two groups. Picture: Getty

A report from the Institute or Directors (IoD) said that some unions have “become divorced from their original purpose” as it called for a shake-up of employment rights legislation.

The report claimed some unions were too powerful and could cause disruption “beyond the site of the original dispute”.

Britain’s largest trade union, Unite, which now has 1.5 million members, was created by a merger between the Transport & General Workers Union and Amicus, a private-sector union.

Under the IoD proposals, the Competition Commission would be able to investigate and even block trade union mergers.

The Commission already has wide-ranging powers to deal with concerns over companies, which extend to blocking mergers from going ahead.

The IoD also called for measures to make it easier for employers to dismiss workers, and a move to block European Union directives over employment law being implemented.

The IoD insisted that the measures were needed to crack down on what it said were the “damaging effects of increasing trade union militancy”.

However, Scottish union leaders and MSPs reacted angrily to the ideas.

Stephen Boyd, assistant secretary of the Scottish Trades Union Congress (STUC), warned the proposals would weaken the employment rights of workers, saying: “Further attacks on employment rights are the last thing we need, as this would lead to even lower wages and weaker consumer spending.”

He added: “The IoD represents just 1,000 directors, whereas the STUC has 630,000 members.”

SNP MSP John Wilson insisted that trade union mergers could lead to improved representation for workers. And he added: “The report by the IoD which calls for an investigation into mergers within the trade union movement is total hypocrisy, as many mergers within business are not subject to regulation.

“Trade unions have a legitimate role to collectively work together for the benefit of their members.”

Labour MSP Neil Findlay accused the IoD of promoting the coalition government’s policies. He added: “Working people are under intense pressure from pay cuts and freezes, job losses and attacks on their standard of living, and what is the IoD’s solution to the Tories’ failing economic strategy? An attack on trade unions and rights of workers.”

The IoD report said giving powers to the Competition Commission over unions should be part of overall moves to restrict trade union activities.

The authors of the report went on to back “no-fault dismissal” that would allow some firms to dismiss workers without giving a reason. There was also support for the UK to accept “only the minimum” from EU directives on employment law.

Simon Walker, director general of the IoD, called on the UK government to introduce the proposals before the 2015 general election. He said: “Nearly half of businesses think that regulation is holding them back. Ministers must seize this opportunity to tackle the issue head-on.”

Conservative MSP Alex Johnstone said: “If companies go through a series of mergers there can often be serious issues of competition law. These proposals are worth considering.”