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Thomson Reuters

Legal debate series: should we limit strike rights or CEO pay?

Tom Bangay

22 Mar 2017

Is it outrageous to limit strike rights and not CEO pay? That was the motion put before an audience of law firm partners and senior in-house counsel at the first of the 2017 Legal Debate Series at Thomson Reuters.

The debate follows a year of well publicised industrial action from the National Union of Rail, Maritime and Transport Workers (RMT) regarding pay and conditions, and junior doctors striking over their NHS contracts and resulting impacts on healthcare. The impact of the new Trade Union Act is still unknown, but should workers fear this new legislation? Is curbing strike rights really appropriate after eight years of austerity and would it not be hypocritical to also look more closely at CEO pay?

The pre-debate vote by the audience made it clear that the team arguing for the motion (journalist and author Isabel Oakeshott and Barrister Carol Davis) had their work cut out for them: 67 per cent had decided against the motion with only 11 per cent in favour. There was something to play for though, as 22 per cent of the audience remained undecided.

What’s wrong with high pay?

Isabel Oakeshott kicked off the debate and it was clear early on that her tactic was to play to the audiences’ recent experiences of the rail and tube strikes, lamenting the current situation where small numbers of workers could bring the capital to a halt. And what is wrong with high pay anyway, claimed Oakeshott: wouldn’t it be better to focus on the lot of the lower paid? At this delicate point in the Brexit negotiations, why would we send a message to the rest of the world that we will curtail your ability to earn?

First to argue against the motion was Hannah Reid of the Trades Union Congress. Her arguments were compelling, her message simple. And she had the confidence of knowing the audience was on her side. “We’re facing the tightest squeeze on earnings, and zero hour contracts,” she argued, suggesting that the 2016 Trade Union Act had gone too far, and that the right to strike brings equality of power when negotiating. “Maintaining the status quo isn’t an option,” she claimed: “we need a new model for corporate pay,” particularly when top CEO pay reaches, in two and a half days, what the average UK worker earns in a year.

Fairness, CEO pay and the free market

Carol Davis, Barrister at Littleton Chambers, is someone accustomed to holding court and it was clear from her performance that she was in her element. Davis was arguing confidently for the motion and attempting to win back some of the undecided voters. She referred to the ongoing rail strike as a “turgid and long-running debate over who decides to open and close doors.” The meat of her argument was that this debate is ultimately about our perception of fairness: is it fair that a premier league footballer earns so much more than a nurse? No, said Davis, but then again, life’s not fair! We live in a free-market economy and CEOs earn more because they can make or break companies.

The audience had clearly warmed to Davis’ performance, but could our final debater, Andrew Burns QC of Devereux Chambers, clinch victory for his team? Burns pointed out that the right to strike appears in the UN Charter, the European Convention on Human Rights and the Charter of Fundamental Rights of the European Union, and has been a fundamental factor in UK democracy dating back to the Tolpuddle Martyrs. Since the 1930s, and the winter of discontent in the 1970s, disruption caused by industrial action has significantly declined. “With no right to strike, we’d have employers pushing towards profitability at any cost until worker morale collapses,” Burns warned. He highlighted the example of the Co-op – a client – whose CEO, Richard Pennycook, took a 60 per cent pay cut once the company was out of danger.

Boardroom representation

At this point, the chair, Reuters Editor at Large Axel Threlfall, took questions from the audience. Could union representation in the boardroom be the answer, following the models provided by Japan and Germany in the 70s and 80s? Why aren’t politicians held to the same standards, in terms of ballot and turnout thresholds, as the workers whose rights they seek to curtail? And should value be the defining measure – the chaos caused by striking train divers suggests they do provide a valuable service, wheras if Sir Martin Sorrell withdrew his labour for a day, would anyone notice?

Our debaters made closing arguments and appealed to the remaining swing voters in the audience, after which the final votes were counted. Although Isabel and Carol had moved the needle, swelling support for the motion to 35 per cent, those opposing the motion were victorious. The proposal that we must limit strike rights, not CEO pay, was defeated.

Arguing for the motion were Isabel Oakeshott, Journalist and Author, and Carol Davis, Barrister, Littleton Chambers. Arguing against the motion were Andrew Burns QC, Barrister, Devereux Chambers, and Hannah Reed, Senior Employment Rights Officer, TUC. The debate was chaired by Axel Threlfall, Editor at Large, Reuters.

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