Welcome to the latest edition of our UK labour law update. In this update we provide information on labour law news including changes to industrial action law and strengthening employee voice, as well as developments in recent case law, including Dunkley v Kostal UK Ltd, PDA Union v Boots MS Ltd and BALPA v Jet2.com.

UK labour law news

Trade Union Act changes to industrial action law: now in force

Changes to industrial action law introduced by the Trade Union Act 2016 were implemented on 1 March 2017. The changes include introducing: a 50% ballot threshold for voter turnout, a 40% ballot support threshold in ‘important public services’, tighter controls on picketing, longer advance notice of strikes, a requirement to re-ballot with ongoing disputes and changes to the voting paper. Revised Codes of Practice (firstly, on Industrial Action Ballots and Notice to Employers, secondly, on Picketing) also came into effect on 1st March 2017.

Worker voice: recent developments

With the Government’s Corporate Governance Green Paper examining ways to strengthen employee voice, particularly at board level, it is notable that some companies are already taking action. It has been reported that two FTSE companies are looking to put a worker representative on their boards, or to provide for worker attendance at board meetings, while another large FTSE company is holding its first annual meeting for employees as part of a push to strengthen links between the boardroom and employees. This trend is only set to continue as it seems likely that the Government will push ahead with measures aimed at increasing worker voice in larger companies, although it is currently unclear whether these will be on a voluntary or legislative basis.

UK labour case law update

Dunkley v Kostal UK Ltd: contractual change without collective agreement

The employer had recently recognised Unite for collective bargaining. During the first annual pay negotiation, the employer’s pay increase and Christmas bonus was conditional upon some changes to overtime, sick pay and breaks. The offer was rejected by the union and by members in a consultative ballot. The employer then wrote directly to employees setting out the pay increase offer and changes to other terms with a warning that rejection would result in no pay increase and bonus. A successful section 145B claim was made against the employer (which in broad terms prohibits an employer from making an offer to a member which results in his/her terms no longer being determined by collective agreement). The employer argued that the offer was a temporary solution to an impasse with the union and that collective bargaining continued thereafter. This was rejected by the tribunal on the grounds that ‘the employer cannot drop in an out of the collective process as and when that suits its purpose’.

PDA Union v Boots MS Ltd: the status of a ‘token recognition agreement with tame in-house union’

The PDA union requested statutory recognition by the employer. Shortly before that request, the employer entered into a limited recognition agreement with a non-independent in-house union, the effect of which was to prevent the PDAU’s recognition request from proceeding. The PDAU appealed the High Court’s decision that the statutory recognition legislation, which provided for this outcome, was not in breach of the European Convention on Human Rights. Their appeal was dismissed and the Court of Appeal held that the right in the legislation for a worker to apply at any time for the in-house union to be de-recognised (subject to the necessary worker support), following which the PDAU would be able to apply for recognition, resulted in there being no breach of the Convention. However, as the Court observed, the employer’s victory may be short-lived since ‘a route has been identified under which the PDAU can seek to take advantage of the statutory recognition procedure’.

BALPA v Jet2.com: the scope of negotiations following statutory recognition

The employer argued that it was not required to negotiate, in accordance with the statutory recognition framework, with BALPA on proposals concerning rostering arrangements because only matters which would result in specific contractual rights should be within scope of negotiations on hours. In its view, the rostering arrangements were not ‘apt’ for incorporation given their flexible nature. The Court of Appeal rejected this argument stating that the scope of collective bargaining was defined in the legislation by subject-matter (whether it related to ‘pay, hours or holidays’) and not by contractual status. As such, it did not matter whether the negotiation proposals, if accepted, would give rise to contractual rights, since the employer was required to negotiate about them so long as they related to pay, hours or holidays. Many will view this as a common sense approach in the circumstances.