From July 2022, businesses were allowed, for the first time in decades, to use agency workers to replace striking employees. Yesterday, just a year on, the High Court quashed the regulations which made that permissible on grounds that they are unlawful.
The judicial review challenge in question was brought by ASLEF and UNISON against the Secretary of State for Business and Trade. There were two grounds of judicial review:
- In 2022, Kwasi Kwarteng, then Secretary of State for Business and Trade, failed to comply with the statutory duty to consult before he implemented the 2022 regulations.
- At the same time, he breached Article 11 of the ECHR on the basis that the regulations unlawfully interfered with the rights of trade unions and their members.
The challenge succeeded on the consultation ground only. The High Court saw no need to consider the second ground.
To be clear, this was not a situation where there had been no consultation at all. The issue was that the consultation was not current; it had taken place seven years before the 2022 regulations were implemented. In 2015, as part of the Government’s campaign to update strike laws, the Government proposed to repeal regulation 7 of the Conduct of Employment Agencies and Employment Businesses Regulations 2003. Regulation 7 was the provision which prevented businesses from hiring agency workers to replace striking workers. However, when the consultation received a lot of negative responses, the Government decided not to implement the proposals.
Fast forward seven years to the summer of 2022, when the rail companies were striking. The Government decided that it needed to address the problem and Mr Kwarteng rushed through the 2022 regulations without further consultation and with little Parliamentary scrutiny.
In its judgment, the High Court said that Mr Kwarteng’s approach to the implementation of the legislation was so unfair as to be unlawful and irrational. What he should have done, according to the High Court, was to arrange for the consultation to be refreshed by seeking updated views and evidence, given how much time had elapsed. In the absence of that consultation, the regulations were quashed on the basis that they were unlawful.
For businesses and for the Government this is a real blow, particularly given how much strike activity there has been in recent months.
So, what is the likelihood of the Government trying again?
Well, it could appeal the judgment, although there seems nothing obvious in the judgment which would give it grounds to do so. If it does appeal, the judgment specifically confirms that the Court of Appeal would have full rein to decide on the second ground (breach of Article 11) if it decided to allow an appeal on the first ground. This means it is possible that the Government would appeal, win the appeal but then have the regulations quashed for being unlawful by reason of breach of Article 11.
Instead of appealing, there would also be scope for Kemi Badenoch, now Secretary of State for Business and Trade, to take the proposal back to the drawing board, consult properly and put in place new regulations. This might be quite appealing given the recent and ongoing strikes. However, even if she took this route, it would take some time to implement and we would most likely be firmly in a new winter of strikes before any new regulations could be brought into effect. The judgment contemplates that this might be the route the Government takes.