How to negotiate benefits and pay in a unionised environment

Trade union disputes are a common occurrence in the media these days, with the rights of trade unions, their representatives and members set to be strengthened by reforms set out within the Employment Rights Bill. It would, therefore, be wise for both employers and employees to ensure they are fully aware of their rights and what they are required to do in a unionised workplace environment.

Benefits of unionisation

Trade unions deal with a variety of issues. These include negotiations of salary, bonus and pension increases, equal pay, and pay failing to keep up with inflation. They must also be consulted on redundancies and business transfers under Transfer of Undertakings (Protection of Employment (Tupe)).

Unions also focus on flexible working, holiday and leave entitlements, and overtime pay, says Riaan van Wyk, senior consultant at Barnett Waddingham. “Trade unions work to protect the right to industrial action and discrimination disputes, as well as health and safety regulation compliance,” he explains. ”The union’s role is to uphold the wellbeing of employers and employees, raising cases to avoid legal repercussions for either party.”

Being unionised means workers have chosen to join a recognised trade union to represent their interests, rather than negotiating individually with their employer. If a union is formally recognised by an employer, it has the right to negotiate on behalf of workers.

Chrissy Bell, advisor at Acas, says: “Being unionised can help lay the groundwork for early resolution of workplace disputes, improve constructive communication between employers and trade unions, and encourage a culture of mutual respect.”

A unionised workplace can benefit both employers and employees. Employees can see benefits such as improved working conditions, better overall pay and benefits, and stronger job security, for example.

Sampson Low, head of policy at Unison, says: “The big advantage for union members is they have representatives and trained negotiators fighting their corner regarding pay and benefits. They have the final say on any deal negotiated.”

Employers, on the other hand, benefit from stable relations, fewer individual disputes and higher rates of employee productivity.

Rachel Suff, senior employee relations advisor at the Chartered Institute of Personnel and Development (CIPD), adds: “The end goal will be a shared one, and it’s that mutuality that needs to be at the centre of any employment relationship.”

Negotiating staff pay and benefits

Employees in a unionised workplace have the right to collective representation where they negotiate with their employer via the union. They also have the right to join and participate in union activities as per the 1996 Employment Rights Act, as well as dispute protection, the right to strike if procedures are followed, and immunity from unfair dismissal claims.

If employees are part of a recognised union, their pay and benefits rights can be negotiated through collective bargaining. If not, there is no legal requirement for employers to do so.

Rab Donnelly, deputy general secretary at Usdaw, says: “Collective bargaining on a voluntary provision includes having an agreed upon structure, forums and committees. These help to ensure members can shape things, while representatives can collect feedback. It’s a democratic process, with ballots used.”

The employer and the trade union typically agree on how collective bargaining works, the frequency of meetings, and how disagreements are handled. They also decide on the union official to represent the bargaining unit, which is the employee group being represented, and who is included in this.

Once the framework has been established for conducting negotiations, meetings with employers and union representatives will take place to discuss specific issues, explains Nicole Whittaker, associate director of HR consultancy at Peninsula.

“They work to come to an agreement that suits both parties regarding terms and conditions and benefits,” she says. ”If the union and the employer can’t come to an agreement, there’s usually a pre-agreed plan, or industrial action may occur.”

When negotiating pay in advance of an annual settlement, the process is similar. It can depend on an organisation’s pay arrangements. There will typically be meetings where the union will put forward pay increase demands, which will reflect the cost of living and inflation.

The employer will either agree to the increase or there will be further meetings to negotiate pay, says Suff.

“If an employer doesn’t feel it can give a certain percentage increase, it might look at other areas of the reward package or terms and conditions instead,” she says. ”Then union representatives will then go back to membership with the received offer to see what they think.”

Employers’ responsibilities

If a union is recognised within a workforce, employers are responsible for maintaining constructive relationships with it, listening to concerns and sharing relevant financial information. It is unlikely that organisations will agree to every union request, but they should make reasonable efforts to reach a solution.

If employers are planning collective redundancies or a Tupe business transfer, they have a legal duty to inform and consult with unions or employee representatives, adds Bell.

“Employers must provide reasonable facilities for union representatives to carry out their role in these,” she says. ”This includes access to members and sometimes meeting rooms or notice boards. Additionally, they must provide representatives with reasonable paid time off for training and for their duties.”

Organisations should also ensure they recognise the ballot thresholds met by unions and facilitate reasonable workplace access for representatives.

“It is important to remember that while employers are not required to agree to demands, they must negotiate to avoid claims of unfair actions,” says Van Wyk. “Disputes need to be handled in a reasonable fashion, and pay and benefits negotiations in good faith.”

Employment Rights Bill reforms

The Employment Rights Bill, first introduced in October 2024, is expected to introduce measures to strengthen the rights of trade unions, their representatives and members. Some of these include removing minimum service level rules for strikes and dismissal for taking part becoming automatically unfair.

“Changes that are expected two months after the bill becomes law include the time needed to give notice of industrial action reducing to 10 days, unions needing a simple majority to vote for strikes, industrial action mandates lasting for 12 months, and the simplification of action and ballot notices,” says Bell.

Additional changes due to take place through 2026 include simplifying and updated rules on how a union gains workplace access and recognition, a new right to reasonable accommodation, facilities and time off for trade union and union equality representatives, and increased protection against detriment for industrial action or union activities.

The aim is to make the process for recognising trade unions quicker, eliminating multiple steps that must be followed to achieve this, explains Whittaker..

“The bill will increase awareness of trade unions for employees, as employers will be mandated to notify employees on their rights to join a trade union,” she says. ”This may either be a statement issued alongside an employment contract, or something that goes into the contracts of employment itself.”

Suff adds: “Employers should know what rights are coming down the line and review their arrangements. If there is a genuine consensus for union recognition, it’s much better to approach it positively and come to a voluntary arrangement.”

If negotiating pay and benefits in a unionised environment, going forward, it will be important that employers follow the reforms laid out in the Employment Rights Bill to ensure satisfaction from all involved parties and, ultimately, stronger business outcomes.