Rover’s vital lesson to all: it pays to talk

The furore over the large-scale job losses expected at Rover following its sale by BMW could have serious fallout in the wider field of employment relations.

Lay-offs at such a high-profile UK company – albeit German-owned – has seen the unions angrily accuse Labour of being too soft in the face of business. And unions have been joined in their attacks by Will Hutton, chief executive of the Industrial Society and influential left-of-centre thinker. The answer, they claim, is to accept and extend European plans for stronger rights for employees in consultation over planned redundancies. They argue this would avoid future hammer-blow announcements and would hopefully mitigate the scale of redundancies.

It is ironic that the two governments to have blocked the proposals so far are those of the UK and Germany; and that the lack of strong consultation requirements contributed to ministers’ claimed lack of forward knowledge of BMW’s plans.

The whole question surrounding redundancies consultation is without doubt becoming more acrimonious. Only last week we reported how former Sainsbury’s staff across the country had lodged a string of claims at tribunals because they felt they were not properly consulted. It is an important employee relations issue, and with unions now chomping at the bit, personnel departments should make sure it is on their radar.

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But even if the Government decides to ride out union criticism, it may find itself forced into accepting stronger consultation rights in any case. The disclosure, in a leak to Personnel Today, that the European Commission will drive forward stalled plans for stronger rights once the French take over presidency later this year only confirms the way this story is likely to turn. And it isn’t good for Labour: Stephen Byers has been winged by Rover and if the EC gets its way the Government will also, no doubt, be accused of surrendering to Europe.

Whether these moves to extend consultation requirements are the right way to go or not is debatable. But what is clear is that the head of steam built up under this issue is almost certain to drive it forward.