Penguin Random House has derecognised the National Union of Journalists and Unite for collective bargaining with its management.
The move, which breaks a particularly strong history of good relations between unions and management on the Penguin side of the business, is said to have left staff "bewildered" and "nervous."
Negotiations have been going on throughout the autumn to finalise a new house agreement that would cover all the divisions of the merged PRH company but they failed to reach a resolution, with redundancy terms a key sticking point.
PRH UK c.e.o. Tom Weldon told staff in a memo on Friday (16th December) that there had been several months of discussions to bring all the London employees together under one union agreement.
"In doing this, the most important thing for us has been to have parity and equity for all London colleagues and ensure no groups of people are treated differently on account of where they are based or where they previously worked," he wrote in the memo, seen by The Bookseller. The agreement had not been reached, and so the publisher's formal relationship with the NUJ and Unite in London had come to an end, he said.
"In practice you will see minimal impact as result of this," Weldon told staff. "As an individual you can still be a member of a union and receive their advice and support. We also have an active Staff Forum which represents every area of the business and meets regularly with me to raise your concerns, questions and ideas, and this will continue."
Meanwhile the two unions issued a joint press release the same afternoon in which they attributed the negotiation breakdown to PRH's refusal "to honour the collective redundancy terms for the Penguin staff" which had originated under Pearson, or to agree to take the disagreement over this to arbitration service Acas.
Fiona Swarbrick, NUJ national organiser, said: "By de-recognising the NUJ and Unite, PRH has blatantly disregarded the views and wishes of its employees and has significantly damaged the good reputation of the business as being one which cares about people." Unite's regional officer Louisa Bull warned: "Unite will strongly oppose this hard-line stance by the management to erode employees’ redundancy rights. This is the thin end of the wedge that could lead to further erosion of pay and terms and conditions for staff."
Under the arrangements made by Pearson, Penguin staff who are made redundant have a specific entitlement to three months pay plus a month for every year they have been employed. Since the merger, Random House employees have been matching the Penguin terms, but with a cap at 12 years. Penguin Random House is understood to have wanted to include no specific redundancy terms at all in the new house agreement, which would cover all PRH employees. Statutory redundancy stands at a week's pay per year of service (limited at £479), capped at 20 years.
Weldon commented to The Bookseller: “Historically Penguin Books and Random House have had different relationships with the Unite and NUJ unions in our different London offices. Now that we are one company, we have been in discussions with Unite and NUJ to try to bring all Penguin Random House employees in London together under one new agreement to ensure no groups of people are treated differently on account of where they are based.
“We have been negotiating with the unions for over three months since the start of September. Disappointingly, we have not been able to reach an agreement that achieves this and as a result our formal relationship with Unite and NUJ in London has come to an end.
"There is no change to any individual employee’s terms and conditions."
Weldon went on: “This has been a difficult decision and one we hoped not to have to take. Penguin Random House is a responsible employer and we have always sought to treat all staff respectfully, responsibly and equally, whether or not they are covered by union agreements.
“We have positive relations with Unite in Frating, Grantham and Rugby and will continue to work closely with them in sites.”
While the derecognition of the unions will not affect employees' contractual terms - which include pay, hours and holiday, but not redundancy - it does mean the union will be unable to negotiate collectively, as with annual pay rises, or hold chapel meetings on PRH premises. The unions completed the latest PRH annual pay negotiation - awarding staff 1.5% or £400, whichever is the greater - just days before being derecognised.
PRH staff were said to be "bewildered" by their management's stance, coming after generally good relations between management and unions, and at a time when the company is performing strongly, with the huge success of Paula Hawkins' The Girl on a Train.
A PRH NUJ representative who preferred not to be named said: "'The merger between Penguin and Random House three years ago has been productive and positive until now, and the combined company has been going from strength to strength....We have a long history of working collaboratively with the company, the union attitude has always been that we all go forward together.'
Meanwhile PRH Unite rep Andy Taylor noted: "When we did the merger with DK in 2000, Penguin was by far the better off in terms and conditions, but the one thing DK was better off in was their holiday entitlement. [Management] levelled everybody up [to match the best conditions on offer in either business]. We're disappointed that's not been the case this time around."
"If you want to reduce your redundancy liabilities, negotiate them, don't just chuck out the union. It's quite a brutal step," commented one staff member who declined to be identified.
While PRH is not understood to have plans for future redundancies, staffers also said the fact that this issue was at the forefront of the negotiation's failure made them "nervous". The headline of a Guardian article published on Friday evening, which first reported the change, highlighted "Redundancy fears", but without specifics.
Taylor told The Bookseller: "The company is moving the Penguin side out of its Strand office and Transworld out of Ealing by 2020. Vauxhall Bridge Road is staying where it is and another site is being found close by. There are concerns that will mean redundancies. However we'd be surprised if it meant very many."
He described the response within the staff force to the development as being "absolutely terrific". He said: "I'm in my 50s now but all of a sudden it has made a younger generation of employees appreciate what we do and why we are doing it. Lots of people are joining for the first time, and others who are members already are now saying they want to be more active."
The unions are now looking to the Central Arbitration Committee, the statutory body which adjudicates trade union recognition and collective bargaining, to restore their union agreements at Penguin Random House.
Prior to the PRH merger, the NUJ had been recognised for collective bargaining in Penguin for many years, and also had a history of recognition in Random House, although it was not recognised at Transworld. The union is not currently recognised for collective bargaining in Hachette, Simon & Schuster or Pan Macmillan, and in HarperCollins is recognised in Scotland only. However it is recognised at Usborne, Faber, Taylor and Francis and LexisNexis.
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