Welcome to our March UK labour law update. This edition contains the following content:

UK labour law news

  • Trade Union Bill amended significantly in the House of Lords
  • Save the date: London Stock Exchange, 20 October 2016, Eversheds’ 13th annual Labour relations conference

UK labour case law update

  • Pujante Rivera v Gestora Clubs: resignations can trigger collective consultation
  • Bone v North Essex Partnership NHS Foundation Trust: the risks of ignoring inter-union antagonism
  • Emerson Electric European Works Council and Ors v Emerson Electric Europe: significant CAC EWC ruling

UK labour law news

Trade Union Bill amended significantly in the House of Lords

The Trade Union Bill seeks to: introduce a new 50% threshold for voter turnout during industrial action ballots, with an additional 40% support threshold applying in “important public services”, tighten the supervision of picketing, provide for longer advance notice of strikes and the re-balloting of ongoing disputes, change the ballot paper, ban public sector check-off arrangements, increase transparency of public sector facility time and extend the role of the Certification Officer.

The Bill completed its passage through the House of Commons last year largely unchanged, despite heated arguments over its contents from opposing parties. In particular, both the Scottish Parliament and the National Assembly for Wales objected to the Bill and a number of amendments were sought, for example, excluding the Bill’s application to the public sector in those countries. These were resisted by the Government on the grounds that “employment and industrial relations law are clearly reserved matters under the Scottish and Welsh devolution settlements. It is entirely in order for the Government to propose that the Bill applies to the whole of Great Britain.”

Moving to the House of Lords, the Bill has encountered strong opposition, resulting in a number of Government amendments to appease opponents. These include:

  • the 40% support needed for ballots in ‘important public services’ (IPS) has been changed. Initially this covered ballots where the majority of workers are normally engaged in the provision of IPS, as well as in ancillary activities. Ancillary activities have now been removed. The Government has also introduced a ‘reasonable belief’ defence, if a union mistakenly breached the 40% requirement.
  • the Bill now requires a ‘summary’ of the dispute to be included on the ballot paper (and no longer a ‘reasonably detailed indication’ which was criticised as being unclear).
  • the Bill’s requirement for two weeks’ notice of industrial action has been modified, so that this period may be reduced to a week if the union and employer agrees.
  • the expiry of the ballot mandate after four months has been extended to six months, or up to nine months if both sides agree, to allow more time for a negotiated settlement.
  • much has been made of the requirement for a picket supervisor to wear a badge or armband to identify him/herself. Following a change, the supervisor must simply wear ‘something’ to be readily identifiable.

Several amendments, opposed by the Government, have also been made to the Bill and it is currently unclear how the Government will respond as the Bill moves towards Royal Assent this spring:

  • a new provision requires the Government to review the delivery of electronic voting during industrial action ballots and to publish a strategy for the rollout of e-balloting. The Government has resisted e-balloting on security and confidentiality grounds.
  • the Bill’s clause which provides a power to restrict public sector facility time was deleted. The power to require public sector employers to report on facility time and pay remains.

The Bill returns to the Lords on 19 April and more changes may be made, for example, to the ban on check-off. Behind these headline issues the practical application of the Bill is also being discussed in Parliament, many of which concern employers including; precisely which public sector employers fall within the scope of the facility time and check-off changes; what roles are subject to the IPS 40% threshold; and whether employers, once the Act is implemented, will be caught up in human rights arguments when relying on its provisions. Finally, the devolution issues remain unresolved with the First Minister in Wales stating that he would, if necessary, take his opposition to the Supreme Court. We will keep you informed as the Bill moves towards Royal Assent. In the meantime, if you wish to discuss how the Act will affect your organisation, please contact our experts below.

UK labour case law news

Pujante Rivera v Gestora Clubs: resignations can trigger collective consultation

This EU Court of Justice (‘CJEU’) decision has received little attention but is worth noting, even if the facts will only arise from time to time. It affects, in particular, large scale changes to terms and conditions and whether an employee resigning in objection should count towards the 20 or more employee trigger for collective redundancy consultation.

R was among a number of employees dismissed on the grounds of redundancy. Another employee, X, terminated her contract in response to a 25% pay cut. R argued that X’s termination should have been included when calculating the number of redundancies, thereby triggering collective redundancy consultation. The CJEU agreed with R.

This case only affects the definition of redundancy in relation to collective consultation (which is wider than the better known definition relating to individual redundancies involving a reduced need for employees). As a result, during large scale redundancies and changing terms projects, employers need to be alive to resignations in response to unilateral and significant changes to the employee’s detriment and whether/when collective consultation should be commenced and an HR1 form submitted.

Bone v North Essex Partnership NHS Foundation Trust: the risks of ignoring inter-union antagonism

In this case, the employer recognised Unison but not the Workers in England Union (‘WEU’). B, a WJEU member, complained of bullying by Unison representatives and that his employer had failed to protect him from this detrimental treatment. The Court of Appeal upheld the tribunal’s decision in his favour. The Court decided that the employer’s main purpose for failing to act was to deter B from his WJEU activities and to marginalise WJEU’s influence in order to placate Unison and ‘achieve a quiet life’. It rejected the employer’s case that their purpose was to remain neutral between Unison and WJEU. The case serves as a warning to employers who wish to stay on the side lines of union disputes. While this may be a legitimate aim, when disputes unacceptably affect the way workers treat each other the employer may have to investigate and potentially invoke the disciplinary procedure, as appropriate, to ensure that the employer is not seen as being intentionally supportive of one side’s trade union activities and detrimental to the other’s.

Emerson Electric European Works Council and Ors v Emerson Electric Europe: significant EWC CAC ruling

The employer (‘EEE’) signed a new EWC agreement in 2014. In 2015, the EWC took a complaint to the Central Arbitration Committee (‘CAC’) following a public announcement by EEE of a major global restructuring which was made without prior EWC information and consultation (and without the prior knowledge of its European managers as well). It also complained about funding and access to experts/legal representation. In their defence, EEE argued that the EWC agreement did not require information and consultation before a global (as opposed to purely European) announcement and it would inform the EWC once the potential European consequences were known.

The CAC upheld the EWC’s complaint that it should have been informed and consulted prior to the announcement. While the complaint over the role and cost of experts was ultimately resolved between the parties, it is notable that the CAC may be reluctant to support future claims for EWC legal costs, saying that complainants do not need lawyers because ‘the CAC takes steps to ensure that an unrepresented party is not disadvantaged’.

This case illustrates differences in approach between continental-style information and consultation, as characterised by EWCs, and the top-down approach of some US companies. It is a reminder that employers new to EWCs, particularly those based outside Europe, should familiarise themselves with their agreements to avoid the time, expense and inconvenience of defending claims before the CAC (and a potential £100,000 penalty).