The company that owns and manages Britain’s vast railway network has taken a firm stance against employees who participated in major strike action over the past year: it won’t pay them their annual bonuses.
Network Rail’s move has stoked further anger within its workforce, according to the Financial Times, as up to 20,000 staffers could be affected by the decision.
It comes at the heels of a protracted dispute between Network Rail and the Rail, Maritime and Transport Workers union (RMT) over pay. The disagreement, which resulted in the U.K.’s biggest train strike in decades, concluded in March with RMT accepting a 9% pay rise offer from the company.
However, Network Rail could now face further friction with the rail union following the withholding of bonuses. The group reported a loss after tax of £1.1 billion ($1.38 billion) for the year to March 2023, with poor freight and rail performance due to strikes impacting the company's returns.
RMT chief Mick Lynch said on Tuesday that Network Rail's decision was "disgraceful and is understandably causing significant consternation among [union] members."
"It is clear that the stance adopted by Network Rail both penalizes and discriminates against members for exercising their human right to associate and to participate in lawful trade union activities," he said in an emailed statement.
“As the bonus scheme is discretionary, and not a contractual obligation, the decision to exclude RMT members has been taken in bad faith and is a transparent attempt to divide the workforce and undermine your Union, by specifically rewarding those who refused to stand in solidarity with Union members taking essential strike action."
The bonus paid out to workers is reportedly expected to be £300 ($378), a reflection of the company’s current financial situation. In previous years, Network Rail has paid out bonuses worth around £1,000 ($1261), according to the FT.
Network Rail told Fortune on Tuesday that it had previously warned employees about the non-payment of bonuses if they participated in strikes.
“We have been crystal clear with both our trade unions and our employees that the cost of strike action would directly impact the PRP [performance related pay] scheme,” a Network Rail spokesperson said in a statement.
“Our position was made very clear—any discretionary payments would focus on those who continued to support rail services during industrial action.”
The group declined to comment on whether it would consider similar measures if strikes were to continue through its current financial year.
Industry strikes and the inflation problem
Railway strikes began last year amid growing calls for higher pay as inflation ravaged Britain’s economy and a cost-of-living crisis hurt people’s spending power. Workers in other industries like healthcare and warehousing also raised the alarm on how wages weren’t keeping up with surging costs.
In February, the British government found that strikes across the country had resulted in a loss of 2.47 million working days in the six months to December 2022. Strikes impacting railways were linked to a drop in consumer spending as fewer people were able to commute to work and buy coffee or breakfast.
Railways help connect the sprawling suburban areas of the U.K. with its urban city centers, serving as the lifeblood of the country’s economy.
Although RMT and Network Rail have agreed to a pay rise, the worker’s union is still in dispute with the Railway Delivery Group—an industry body representing train operating companies—over working conditions, pay and job security. Rail workers are continuing to strike into early September in their fight for a "just settlement" with RDG, Lynch said in a statement earlier this month.
Some strikes over the proposed closure of railway station ticket offices are also still ongoing, with unions arguing their erasure could impact vulnerable and disabled passengers.
