The High Court has declared that the Conduct of Employment Agencies and Employment Businesses (Amendment) Regulations 2022 (2022 Regulations), which allow employers to hire agency workers to cover staffing gaps caused by strike action, are unlawful and will be quashed (invalidated) with effect from 10 August 2023. Employers who currently use agency workers to cover striking workers (or were planning to do so in future) should now urgently review those arrangements to ensure that they end before 10 August 2023. From that date, the ban on engaging agency workers to cover staffing gaps caused by strike action contained in regulation 7 of the Conduct of Employment Agencies and Employment Businesses Regulations 2003 (2003 Regulations) will once again apply.
The 2022 Regulations came into force on 21 July 2022, having been enacted at speed by the Government at a time of industrial unrest. The change in the law allowed businesses impacted by industrial action to fill vital roles with temporary, skilled workers.
The 2022 Regulations revoked regulation 7 of the 2003 Regulations, which had previously prevented employment businesses from supplying temporary workers to perform duties normally performed by a worker on strike or taking official industrial action, or duties normally performed by any other worker assigned to cover a striking worker. This meant that employers were no longer restricted from engaging temporary workers when industrial action was taking place.
Kwasi Kwarteng, who was Secretary of State for Business, Energy and Industrial Strategy (Secretary of State) commented at the time that: “In light of militant trade union action threatening to bring vital public services to a standstill, we have moved at speed to repeal these burdensome,1970s - style restrictions.”
However, thirteen trade unions issued judicial review proceedings in the High Court, challenging the lawfulness of the 2022 Regulations. The unions argued that the Government's decision to enact the 2022 Regulations was unfair and that the Secretary of State failed to comply with his statutory duty under the Employment Agencies Act 1973 to consult before making the 2022 Regulations, as well as breaching his duty under Article 11 of the European Convention on Human Rights (ECHR) to prevent unlawful interference with the rights of trade unions and their members.
The case was heard in May 2023. In a judgment handed down on 13 July 2023, the High Court upheld the application for judicial review on the consultation ground and declared that the 2022 Regulations, which allow employers to use agency workers to replace those on strike, are unlawful, unfair and irrational, although the court did not express a view on the Article 11 ECHR ground.
What should you do now?
The order to quash (invalidate) the 2022 Regulations will take effect on 10 August 2023. This means that any employers currently using agency workers to cover striking workers (or planning to do so in future) should now urgently review those arrangements to ensure that they end before 10 August 2023.
The Government has seven days from today to appeal the judgment, so we will monitor what they decide to do next. Another option open to the Government is to commence a full consultation about the change with a view to lawfully introducing the 2022 Regulations again in due course, although this would be likely to take some time and may not receive sufficient support.
