ISS backs action over National Express's US labour relations

A group of National Express shareholders is to challenge the company to carry out a review of poor labour relations at its US school bus business.

ISS, the influential investor advisory body, backs the move and had advised shareholders to vote for action at the group's annual meeting next week.

Employees at Durham School Services, the group's US school bus business, have complained that they have been prevented from joining the Teamsters union and say that managers have interrogated staff and sacked those who showed trade union sympathies.

Investors making up 2 per cent of the Birmingham-based bus and train operator's shareholding - including the Local Authority Pension Fund and the Greater Manchester, Islington and Nottinghamshire county council pension funds - back the action.

Although the dispute has been running for more than five years, it is the first time that ISS, which represents shareholders with about a fifth of the UK stock market, has supported a response.

Fellow shareholder advisory body PIRC is also backing the vote, although Glass Lewis is not.

"As the proposal's request is neither unduly burdensome nor overly prescriptive, a positive result from an independent review of the specific accusations can draw a line under this persistent issue and help the management focus on day to day implementation of the strategy set by the board," ISS said.

National Express rejected the move and defended its employment practices. "We believe the resolution placed by the US Teamsters union and their supporters is a campaign tactic that they have also used with other companies in an attempt to force them to forgo their right and responsibility to engage directly with their employees," it said.

The company claimed that it had already carried out an independent survey, with most staff saying that they had freedom of association. It added: "We are pleased that Glass Lewis has recommended shareholders support the board, recognising our transparency, accountability and concern for issues related to worker rights."

The resolution requires the support of 75 per cent of shareholders. A similar resolution at last year's AGM failed with about 15 per cent voting for action.

The International Transport Workers' Federation said that it supported the resolution, adding that shareholder votes on industrial relations were extremely rare in the UK.

A vote for action would compel National Express to carry out an independent review of its employment practices in its school bus business.

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