‘Groundbreaking’ nuclear power agreements signed

In June 2013, EDF Energy concluded two agreements with UK trade unions and the main contractor for the construction of the planned new nuclear power station at Hinkley Point C in south-west England. They cover recruitment, training, apprenticeships, health and welfare, and pay and conditions. The unions have described the agreements as ‘groundbreaking’, and EDF has said they will ensure that the project is delivered on time if it is decided that the power station should be built.

Groundbreaking agreements

On 5 June 2013, EDF Energy signed two industrial relations agreements with trade unions and the main contractor for the construction of the planned new UK nuclear power station at Hinkley Point C in Somerset.

The project – which involves the construction of a European pressurised reactor nuclear power station with a generating capacity of 3,260 MW, costing GBP 14 billion (€16.4 billion as at 27 June 2013) – has had a chequered history to date.

In February 2013, EDF’s joint venture partner Centrica pulled out of the project, citing concerns over delays and rising costs associated with the building of new nuclear power plants. Long-running talks between the company and the UK government over the price of electricity from the plant continued to make slow progress and, in April, EDF began laying off staff at the site.

The construction of Hinkley Point C could create jobs for around 25,000 people during construction, with around 5,600 people working on-site at the busiest times. Once operational, there would be 900 permanent jobs at the power station.

The new industrial relations agreements – between EDF, the construction unions, The Union of Construction Allied Trades and Technicians (UCATT), Unite and the General Workers’ Union (GMB), and civil engineering contractor Bouygues Laing O’Rourke – cover the management of industrial relations, as well as pay and conditions.

Key provisions

The two agreements are:

  • a common framework agreement, covering industrial relations, recruitment, training, apprenticeships, health and welfare; and
  • a civil engineering sector agreement on pay, pensions and productivity.

The common framework agreement establishes how industrial relations will be managed on the project and guarantees that the signatory unions will have the necessary facilities to ensure workers are treated fairly.

Workers on the site will be directly employed and there will be strict rules governing the recruitment of workers through employment agencies. A high quality occupational health scheme will be established. The agreement also sets the target of training at least 500 apprentices and adult trainees during the lifetime of the project.

The civil engineering sector agreement establishes pay rates for the workforce, which the unions report are ‘significantly above’ those agreed by the Construction Industry Joint Council.

By the time work begins (expected to be in 2014) the craft rate will be at least GBP 13 (€15.2) per hour. The agreement also provides for a bonus scheme, a productivity scheme, milestone payments and pensions. Matched-funding pension arrangements will begin at GBP 10 (€11.7) per week and, by January 2017, an amount equal to 10% of workers’ pay will be paid into their pensions.

Social partners’ reaction

Steve Murphy, General Secretary of the Union of Construction, Allied Trades and Technicians (UCATT), commented: ‘This groundbreaking agreement will ensure that workers building Hinkley Point will receive excellent rates of pay and first class conditions. [It will be] the blueprint for all future major construction projects.’

Kevin Coyne, National Officer for Energy and Utilities for general union Unite, said: ‘The agreement is the result of intense but constructive negotiations. [It] sends a clear message to the rest of the construction industry that good productive relationships can deliver positive results.’

Phil Whitehurst, Construction Officer for general union GMB, said that the agreements would ensure that workers building the power station ‘will be directly employed, well rewarded and treated with respect and dignity, and supported by the trade unions under the structures negotiated over the past 12 months or so with EDF’.

EDF believes that:

having these agreements in place before the final decision to proceed with the project is an important step towards ensuring it is ready for delivery. It will strengthen productivity through a strong commitment to the safety and well-being of workers and sets a climate for positive industrial relations.

EDF’s Hinkley Point C Construction Director Nigel Cann said:

These are important agreements for the project and having them in place now is a significant achievement. This reflects the strength of relationships between the parties involved and their commitment to make the Hinkley Point C project a success.

Next steps

Government ministers granted development consent for the Hinkley Point C project in March 2013, and on 27 June they announced the project would be covered by the UK Guarantees scheme to support projects in the national infrastructure plan.

However, the final go-ahead for construction has yet to be given, pending the outcome of continuing negotiations between EDF Energy and the UK government over the price of the electricity that would be produced by the planned power station.

Mark Hall, IRRU, Warwick Business School

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