Unions have dropped a £68 million legal claim against a controversial pay and grading shake-up at Birmingham City Council, which saw 5,000 workers suffer wage cuts.
An employment tribunal was to have heard allegations from Unison, GMB, Unite, UCATT, Amicus unions that council bosses failed to consult properly over the salary review, which was supposed to iron out inequalities in pay between men and women.
If the case had gone ahead and the tribunal had found in favour of the unions, the council could have faced a huge £68 million back-pay compensation bill.
The decision not to pursue the tribunal case was welcomed by Alan Rudge, the council cabinet member for equalities and human resources.
Coun Rudge (Con Sutton Vesey) admitted that the council, which is already facing serious financial difficulties and is looking to shed up to 2,000 jobs, would have been “crippled” if it had to find an additional £68 million.
He hit out at the unions, claiming that the case “should never have been brought in the first place”.
Coun Rudge said he believed pressure to take legal action had been driven by national union bosses in London for “political” reasons and flew in the face of advice from local shop stewards who were content with the way the council went about organising the pay and grading review.
He added: “We had an extensive consultation process with literally hundreds of meetings. Union leaders have a rightful role and position and should be respected when they act properly.
“I never thought the unions’ claim for backpay would be upheld, but we had to fight the case. The money we spent on litigation does not help city council employees one little bit.
“The fact that the case has been dropped confirms what we knew all along. That the consultation process was fair and lawful. I am delighted that commonsense has prevailed.”
Most of the 5,000 council staff whose pay was reduced appealed against the ruling, with about 80 per cent winning a salary increase.
Unions were unavailable for comment.