Annual Report, Branch Funding and Equal Pay...

As promised, if slightly later than I had intended, here is the remainder of my report from the NEC meeting yesterday in relation to the Annual Report.

Controversy around this document is unusual – on this occasion the argument is around the section of the Annual Report on Equal Pay, with specific reference to funding the costs of litigation on equal pay, and in particular the implications of this for branch funding.

Apologies in advance if this gets a little complicated.

The Union faces very significant costs from mass litigation over equal pay following the implementation of job evaluation based pay structures intended to deliver equal pay for work of equal value in our largest service groups.

Most of this cost arises where, for example, employers will not offer any, or enough, compensation for past loss to those members who are gaining from the implementation of new pay structures and who can in some cases, depending upon the gender profile of the relevant parts of the workforce, bring equal pay claims to seek back pay for up to six years.

Some of the cost also arises from cases being brought against UNISON (as against other trade unions) by “no win no fee” solicitors (who are also touting for business bringing some equal pay cases against employers in return for a good share of the compensation due to often low paid workers for past injustice). I’m trying here to write a measured post about an important issue so I won’t express my feelings for these characters (some of whom are former union lawyers, employing former union officials to attack our movement).

UNISON is solvent, with reasonable levels of financial reserves and is not running up large deficits (which is good news – but probably also encourages litigation against the Union). However, a need for adequate funding for litigation relating to equal pay has been identified repeatedly in recent years.

The NEC controls the Union’s finances but has to do so within the Union’s Rules. One Rule which is dear to the hearts of lay activists at branch level (the volunteers who keep the Union in existence from one day and one year to the next) is Rule H.4.1 which states that National Delegate Conference (consisting as it does of delegates from branches) is the body to decide how branches are funded from our subscription income. A formula was agreed in 2001 which gives all branches a basic 20% of the income from their members’ subscriptions plus various additions, with a guarantee that, overall, no less than 23.5% of national subscription income will go to branch funding (including contributions to the Regional Pool funds to which branches can apply for additional funding for specific projects).

There has been a strong feeling within the Union that “all parts of the Union” should contribute to “meeting the financial costs of the equal pay challenge.” Therefore the Finance and Resource Management Committee of the NEC, at its meeting on 31 January, agreed the text of a motion to be submitted to National Delegate Conference from the NEC explaining the need for these resources and seeking the approval of Conference to “top slice” all budgets, including branch funding to take about 2.5% of subscription income for this purpose (a proposal which is being described as a “freeze” because it is based upon leaving cash payments to branches in 2008 at the 2007 level).

Unfortunately – because of the ease with which the no win no fee solicitors can access details of discussion and decisions from within official trade union meetings and Conferences (with a view to using them in litigation against the trade union) the Standing Orders Committees for all UNISON Conferences have been given legal advice not to permit on the agenda any discussion of equal pay, for fear that this will place the union in legal jeopardy. I have commented here before that I think that this overly cautious approach will create more and more problems for us as the years go by.

Advance notice of the likelihood of such an approach led the Finance Committee members, at the February meeting of the NEC, to agree not to proceed with the motion which they had been intending to recommend. Instead (and this brings us back at last to yesterday’s meeting) it was agreed to explain the proposal in the NEC Annual Report, about which delegates to Conference can ask questions (providing that they submit an initial written question before a published deadline and a further written supplementary question before a further deadline) but which is not generally subject to debate.

Meetings have been arranged around the Regions for Branch Treasurers in particular to be briefed on the proposals in relation to what is generally now described as the freeze on branch funding and this has become somewhat controversial. The Worcester County branch have issued a couple of email circulars objecting to the proposal on several grounds.

As an aside – one of the arguments put forward by Worcester branch does not convince me (as I have explained to them in correspondence). I don’t think that the cost of building a new Headquarters building for the Union is an issue to raise in this context. It is certainly a valid and legitimate issue about which branches may wish to hold the NEC to account at Conference, but in the context of the current branch funding proposals it is a bit of a red herring (I will happily explain here the reasons why I voted to support the proposal when the decision was taken in 2004 if anyone is interested).

Much more to the point, in my opinion, is the fact that our Rule Book simply does not allow the NEC to alter the basis of branch funding without an explicit Conference decision. Worcester County branch have every right to raise this issue (as they do to query expenditure on the new HQ) and reported threats of disciplinary action for sending bulk emails to UNISON Branch Secretaries would be an absurd and counterproductive overreaction.

I raised concerns on this point in the discussion of the Annual Report at the NEC meeting, having given notice that I would. I argued that there was no other Rule of the Union which would allow the NEC to disregard Rule H.4.1 (having heard it suggested that Rule D.2.9.15 might do so) – on this point I was told that this had not been suggested.

I went on to say that trying to use the Annual Report as a device for Conference to take a decision as would satisfy the requirements of Rule H.4.1 in relation to branch funding was not satisfactory since the Annual Report is not submitted in accordance with Rule P.17.2 (which covers NEC reports requiring decisions) but with Rule P.17.1 (which doesn’t).

Both the President and the General Secretary, in their different ways, said that this was “not a fait accompli” until Conference (those were the words of our President – Dave just said that if Conference refers back that section of the NEC Annual Report then “we won’t do it” – i.e. the changes in relation to branch funding will not be made).

Although this acceptance of Conference sovereignty is welcome it isn’t, in my opinion, good enough. The problem is not what would happen if Conference moved reference back of the report, since I believe what was said about that. The problem would arise if Conference did not refer back the report, since it would still be highly arguable that no proper Conference decision had been taken to vary the 2001 formula on branch funding or its implementation and application.

It was suggested to me privately that the office has legal advice to the effect that the requirements of Rule H.4.1 are satisfied if an attempt to refer back a section of the Annual Report is unsuccessful, but I don’t think that this is an adequate approach to the governance of the Union. I am not the only one who is not persuaded.

I find myself in the company of the Glasgow City branch, who submitted a motion to Conference (which has been ruled out of order) – the Glasgow motion, endorsed by the Scottish Council a few days ago, asks Conference to agree the proposals which the NEC Finance Committee want to implement. Since there is a need to resource litigation on equal pay, and since it is reasonable to ask branches for a proportionate contribution to this, I think that the best outcome now would be if the Standing Orders Committee can change their mind about the Glasgow motion.

If this doesn’t happen then the foolish approach of banning ourselves from talking about equal pay for fear of hostile lawyers will have led us to what will almost certainly be the longest, least productive and most bad tempered discussion of the NEC Annual Report in the brief life of our trade union.

Watch this space…