It goes to the heart of Labour’s engagement with business.
To some this is a valiant and principled stand, to others it makes the party look out of touch and remote from people’s lives.
For those helping organisations engage in politics, and particularly with the Labour Party, it could represent the start of a more challenging environment.
McDonald’s is not acting in an illegal way: if it was then the union fighting the recognition issue, the Bakers, Food and Allied Workers Union (BFAWU), would be taking it to court.
Labour may choose to change the current legislation in future but as things stand, this is all about BFAWU’s ‘Fast Food Rights’ campaign and Labour’s apparent support for it.
The campaign has used evidence from Glassdoor about the ‘Top 10 UK High Street Restaurants and Eateries’ or ‘fast food employers’ as the union says.
It uses the data to suggest that McDonald’s came ‘last’, actually meaning 10th place.
The number of employee reviews varies between those in the list. It includes Starbucks, which has itself been subject to a number of campaigns by trade unions.
There are a number of implications of Labour’s decision.
• It is quite possible that McDonald’s is only the first company to face such action. Any company facing a trade union campaign could be next. That increases the importance of union relations.
• This action may focus on trade union recognition but the next topic could focus on equal rights or could move into other areas of policy such as environmental protection or the payment of tax.
• For those engaging, it means appreciating that the practices and behaviours of your organisation need to chime with the approach of the current Labour leadership and the new policies that are beginning to emerge.
• The party is championing the rights of workers for union recognition above that of the work being done to support farmer produce.
• Organisations need to be aware of the possibility of being rejected by Labour, what this could do to their reputations and whether it means they become a political football.
Firms from around the world often have different attitudes and approaches. A US approach to trade unions is not the same as that in the UK. The party needs to be aware that it could alienate foreign owners.
There is no doubt that Labour’s decision will impact on the business atmosphere of the conference and if Labour is trying to demonstrate that it is pro-business then this decision is a fail.
It is not clear whether the same principles will be applied across all party events, for instance fundraising dinners.
In this case, is any organisation that does not recognise trade unions automatically banned from sponsor party events?
The decision is a shift in business engagement with the Labour Party.
It will have supporters and opponents but there is no doubt that business will think twice before engaging with the Corbyn/McDonnell party.
Stuart Thomson is head of public affairs at Bircham Dyson Bell