The latest trade union updates

While the focus of many employment lawyers and HR professionals has rightly been on the easing of lockdown restrictions and the return to the workplace, there have been two significant legal updates in the trade union space which you might have missed. Our summary of these two cases below is a short, 5-minute read to help get you back up to speed.

1. Workers are protected from suffering detriment for taking part in industrial action…

Mercer v Alternative Future Group Ltd and anor [2021] UKEAT 0196_20_0206

You will likely be familiar with the fact that, in the UK, workers are protected from suffering detriment for taking part in trade union activities (a protection which derives from section 146 TULRCA). What you may not know is that, until now, the courts’ interpretation of “trade union activities” has been that it does not extend to employees’ participation in industrial action, effectively meaning that employees could lawfully suffer detriment for having taken part in a strike. In this case, that is exactly what had happened: the employer (Alternative Future Group Ltd) had suspended an employee from work for two weeks who had been on strike in relation to the rate of pay for sleep-in shifts. 

It fell to the EAT to consider whether the exclusion of industrial action from the protection afforded by section 146 was compatible with the right to freedom of association and assembly under Article 11 of the European Convention on Human Rights (ECHR). Cutting to the chase, the EAT’s answer to this question was no: the exclusion of industrial action from section 146 protection breached Article 11 ECHR, as it essentially had the effect of giving free reign to employers to discipline workers who decided to strike.

The EAT was then required to consider whether it was possible as a matter of interpretation to read section 146 in a way that extended the scope of this protection to cover workers’ participation in industrial action. The tribunal had decided that this was not possible under a literal interpretation of section 146 and that any attempt to do so would be to “go against the grain” of the legislation. The EAT disagreed with the tribunal, concluding that the protection under section 146 could be interpreted as covering those taking part in industrial action. In reaching this conclusion, the EAT reasoned that they could see nothing in TULRCA to suggest that one of its primary purposes was to deny protection to workers who take part in industrial action, nor was there anything “in legislative history or any Parliamentary debate” to suggest the same. The EAT therefore overturned the tribunal’s decision that section 146 could not be read in a way that was compatible with Article 11 ECHR.

The main takeaway: employers should not discipline employees simply for the fact they take part in industrial action. 

2. Collective agreements can be rectified…

Nexus v National Union of Rail, Maritime and Transport Workers and anor [2021] EWHC 1388 (Ch)

This High Court case concerned an employer, Nexus, who recognised the defendants (RMT and Unite – both trade unions) for the purposes of collective bargaining. It follows an earlier Court of Appeal judgment which focused on Nexus’ employees’ rights under the applicable collective agreement, known as the “Red Book”.

By way of background, in 2012 Nexus and the unions agreed several changes to the Red Book, including that a productivity bonus would be consolidated into basic pay. After the changes came into effect, a dispute arose between Nexus and the unions, as Nexus took the view that the calculation of employees’ shift allowances would not change as a result of this consolidation and would still be calculated by reference to basic pay (pre-consolidation). What then ensued in 2015 was a large number of claims by union members for unlawful deductions from wages, which were upheld by the Tribunal and ultimately the Court of Appeal. The principle was that the changes to the Red Book which had been incorporated into employees’ contracts of employment did not expressly carve out the productivity bonus from the calculation of the shift allowance, and so the productivity bonus should have been factored into the shift allowance calculations from that point.

What Nexus then sought to do, which is what this High Court case is about, was to approach the High Court seeking rectification of the Red Book. Nexus did so arguing that there had been a common or unilateral mistake as to the point about calculation of shift allowances and that the Red Book should accordingly be amended to make clear that the consolidation of the productivity bonus into basic pay should not operate so as to increase basic pay for the purposes of calculating allowances (including shift allowances). Effectively, Nexus was arguing that the changes to the Red Book did not accurately record what the parties had agreed and should therefore be rectified in retrospect.

The unions opposed this with several arguments, including that Nexus should be stopped from seeking rectification as they were effectively trying to re-litigate the point which had been decided in the Court of Appeal. However, most interestingly, their view was that the High Court had no power to rectify a collective agreement, as collective agreements were effectively non-binding, unenforceable agreements which could not be rectified. The unions applied for strike-out or summary judgment.

Ultimately, the High Court dismissed the strike-out applications and decided that Nexus could seek rectification of the Red Book. In their view, although there was no precedent about the rectification of collective agreements in England (and therefore they drew on authorities from Canadian law), there was no reason to refuse rectification of a collective agreement. Although the unions have applied for permission to appeal, Nexus’ claim for rectification may proceed.

The main takeaway: collective agreements which wrongly recorded what the parties agreed can be rectified, notwithstanding the fact they may be unenforceable.