United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MR A FREER Legal Department GMB 22-24 Worple Road London SW19 4DD
For the Respondents	MR J MIDDLEBURGH (of Counsel) The Solicitor Neath Port Talbot County Borough Council Port Talbot Civic Centre Port Talbot SA13 1PJ MR D ANDERSON AMICUS CURIAE


 


MR JUSTICE MORISON: The Appellant, Mrs Davies, appeals against the decision of an Industrial Tribunal sitting at Cardiff, that she had received her proper entitlement to compensation pay by virtue of section 168 of the Trade Union and Labour Relations (Consolidation) Act 1992 ["the Act"], and that Article 119 of the EEC Treaty did not entitle her to be paid as if she were a full-time worker.

1. The Appellant was employed part-time as part of the council's meals on wheels service since 4^th September 1992. All the other employees were part-time female workers. She is a member of the GMB union. On 12^th February 1996 she was elected as a GMB Health and Safety representative. The present matter relates to two periods of training which she attended in her role as a union representative.
2. The GMB runs courses for its Health and Safety representatives and the appellant attended one such course in Manchester from Monday 20^th May to Friday 24^th May 1996. Of the 17 members attending the course the appellant was the only part-time worker. Mr J Burns, the GMB Regional Organiser had written to the Council's Director of Direct Services requesting paid release to attend the course. The Council's response was that the course was in-house training within the GMB which was regarded as a union activity and not a duty and was not therefore subject to payment. The Council subsequently recanted and later confirmed on 1^st July 1996 that the appellant would be paid for her attendance at the Health and Safety course.
3. In addition to the Health and Safety course the Appellant had raised with Mr K. Harding, her Catering and Cleaning Manager, the possibility of attending the GMB follow-on Induction course in Cardiff between 24^th and 28^th June 1996. Mr Harding agreed to give her leave with pay but rejected her claim that she should be paid on the basis of a standard 39 hour week instead of her usual 22 hour week.
4. On 23^rd October 1996 the Appellant filed an Originating Application alleging that she should have been paid on a full-time basis for the periods spent attending the GMB courses. In relation to the Health and Safety course she claimed that she should have been paid for the full 40 hours that she attended the course and not her normal rate of 22 hours. In relation to the Induction course she claimed that she was again only paid at her normal rate of 22 hours instead of the 32½ hours she actually spent on the course.
5. The tribunal found that both courses fell within section 168 of the Act and accordingly the Appellant was properly entitled to be paid wages for the time that she had off to attend them. They correctly stated that her complaint was that she was not paid as if she was a full-time worker given that she attended the courses on a full-time basis. The tribunal went on to the question of whether or not the training amounted to work within the definition of Article 119. The tribunal stated that there was no evidence that the Health and Safety course would benefit the employer and the Induction course had nothing to do with the Council. They went on to state the following:

"The training which she received was not work for her employers; nor even preparation for work for her employers. It was training for her to be a trade union representative. It seems to us that the question whether it was work has to be decided in the light of the facts of a particular case."

6. The tribunal sought to distinguish Arbeiterwohlfahrt Der Stadt Berlin v Botel [1992] IRLR 423 on the basis that the decision was made in the light of its own facts and the matter of whether special training was work within the meaning of Article 119 was not decided. They relied instead on the decision of the Employment Appeal Tribunal in Manor Bakeries Ltd v Nazir [1996] IRLR 604.
7. The tribunal made the following findings in its conclusion:

"We doubt that this Council or any employer will be providing courses for shop stewards. At the hearing the question was confined to Health & Safety training which may, of course, be the subject of in-house training. We think there is an essential difference between an employee, during working hours, doing her employer's bidding and attending for training. Under her contract of employment she would be entitled to be paid the proper rate for all hours worked. Work in this context would mean doing the bidding of her employer during her employed hours. Mrs Davies was not doing the bidding of her employer. She attended the GMB course of her own volition. Her employers did not send her. Indeed, they had to be persuaded to give her permission at all. The indications are that permission was only granted because of the statutory provision. In our view she would be entitled to be paid if she was called to a meeting or conference in working hours to discuss any matter at the instance of her employer. It does not follow that she is entitled to be paid merely because her Union chooses to call a conference or run a course to discuss a similar matter."

8. The Appellant's Notice of Appeal raises two issues of law which call for decision:

1. Whether the decision in Nazir, that attendance at union conference was not 'work' under Article 119, was correctly decided in the light of Botel and Kuratorium Fur Dialyse Und Nierentransplantation v Lewark [1996] IRLR 637, (though only Botel was cited to the Employment Appeal Tribunal in that case).

2. Whether the tribunal failed to apply correctly the decision in Botel as applied in Lewark, in particular in failing to consider whether or not time spent on Union courses by the Appellant was by reason of the existence of an employment relationship.

9. The relevant statutory provisions on time off for trade union duties and activities are contained in sections 168 to 173 of the Act, which, inter alia, are in the following terms:

"168

(1) An employer shall permit an employee of his who is an official of an independent trade union recognised by the employer to take time off during his working hours for the purpose of carrying out any duties of his, as such an official, concerned with –

…

(b) the performance on behalf of employees of the employer of functions related to or connected with matters falling within that provision which the employer has agreed may be so performed by the trade union.

(2) He shall also permit such an employee to take time off during his working hours for the purpose of undergoing training in aspects of industrial relations –

(a) relevant to the carrying out of such duties as are mentioned in subsection (1), and

(b) approved by the Trades Union Congress or by the independent trade union of which he is an official.

…

169

(1) An employer who permits an employee to take time off under section 168 shall pay him for the time taken off pursuant to permission.

(2) Where the employee's remuneration for the work he would ordinarily have been doing during that time does not vary with the amount of work done, he shall be paid as if he had worked at that work for the whole of that time.

(3) Where the employee's remuneration for the work he would ordinarily have been doing during that time varies with the amount of work done, he shall be paid an amount calculated by reference to the average hourly earnings for that work.

…

170

(1) An employer shall permit an employee of his who is a member of an independent trade union recognised by the employer in respect of that description of employee to take time off during his working hours for the purpose of taking part in –

(a) any activities of the union, and

(b) any activities in relation to which the employee is acting as a representative of the union.

…"

10. Article 119 of the Treaty of Rome provides:

"Each Member State shall during the first stage ensure and subsequently maintain the application of the principle that men and women should receive equal pay for equal work.

For the purpose of this Article, "pay" means the ordinary basic or minimum wage or salary and any other consideration, whether in cash or in kind, which the worker receives, directly or indirectly, in respect of his employment from his employer.

Equal pay without discrimination based on sex means:

(a) that pay for the same work at piece rates shall be calculated on the basis of the same unit of measurement;

(b) that pay for work at time rates shall be the same for the same job."

11. The proper application and interpretation of Nazir, Botel and Lewark are crucial to this appeal. We start by considering the judgments.
12. In Botel the applicant was employed as a home nurse and was President of the Staff Committee. In 1989 she attended six trade union training courses which were necessary for her work on the Staff Council. Her employer gave permission for her to attend the courses which lasted longer than her normal working hours, but she was not paid for the free time which she devoted to the courses and was only limited to their part-time hours. The European Court of Justice found that compensation in the form of paid leave or overtime for training courses constituted 'pay' for the purposes of Article 119. There was a difference in treatment between Staff Council members employed on a full-time and part-time basis and the percentage of female staff council members employed on a full-time basis had been shown to be much lower than the percentage of male Staff Council members employed on a full-time basis.
13. Nazir concerned a part-time chargehand working four and a half hours a day. She was an authorised shop steward and was elected as a delegate to the annual conference of the Bakers, Food & Allied Workers' Union which lasted four days. She was paid her normal pay in respect of her own normal working day for the conference – a total of 18 hours' pay. A male colleague who was a full time employee spent the same amount of time at the conference and was paid his full time salary. On the employer's appeal the Employment Appeal Tribunal held that attendance at a union conference was not 'work', and therefore pay which delegates received under a collective agreement for attending the conference did not fall within the scope of the right to equal pay for equal work under Article 119. Delegates are paid for time off in accordance with the collective agreement rather than being paid to attend the conference. The tribunal made the following specific findings:

"It is therefore obvious that unless there is work, and pay for that work, Article 119 has no operation…the word 'pay' has been given a very wide meaning indeed, because employers frequently consider it in their interests to promote goodwill, enthusiasm and so on by giving bonuses, benefits in kind and indeed promises of benefits in the future. Nonetheless, it seems to us that in the present case we are obliged to enquire what the appellants were paying for, and in particular whether what Ms Nazir was engaged in can conceivably be described as 'work' while she was attending the union annual conference…

…on the basis of the plain wording of Article 119, we should have been disposed to say that it was perfectly plain that the pay which Ms Nazir received in respect of her attendance at the Union's annual conference was not payment for her labours at the conference at all; the pay was in respect of her past, probably also her future work for the appellants."

14. In relation to the European judgment in Botel, the tribunal in Nazir found that the decision was dependent on its own facts, in particular the fact that Staff Committees are an important feature of German labour law and, therefore, the duties of a Staff Committee member promoted the employer's interests. Attendance at a trade union annual conference, on the other hand, could be distinguished from the duties of a German Staff Committee as it did not benefit the employer. The case of Lewark was not cited before the appeal tribunal.
15. The facts in Lewark were very similar to those in Botel. The applicant was a part-time employee who was also a staff council member. She attended a full-time training course which related to her duties as a member of the staff council. The employers paid her on the basis of her contractual working hours, with no compensation in respect of the training day in question, in accordance with German law. The European Court of Justice held that compensation received for loss of earnings due to attendance at training courses which were necessary for performing staff council functions must be regarded as 'pay' within the meaning of Article 119 as it constituted a benefit paid indirectly by the employer by reason of the existence of the employment relationship. The Court held that legislative provisions whereby both full-time and part-time workers attending training courses were compensated up to the limit of their respective normal working hours was in principle, discriminatory. However, national legislation which caused indirect discrimination against women by limiting compensation for attending training courses to their individual working hours could be justified if the measures reflected a legitimate aim of social policy.
16. On the matter of the definition of work, it was the appellant's argument, in summary, that the facts of the present matter were more analogous to those in Botel and Lewark than in Nazir. The tribunal therefore erred in its reliance on Nazir and in considering as separate issues whether the Appellant received pay, and if yes, whether or not that was for work. In the light of the European decisions it was clear that pay is pay for work and where there is pay it must be for work, undertaken by reason of the existence of an employment relationship. It was submitted that the tribunal also failed to consider whether section 168 of the Act was in conflict with Article 119 and whether the European decisions were applicable.
17. Mr Freer, the solicitor representing the Appellant, was supported in his arguments by Mr Anderson, the amicus curiae, for whose attendance and assistance we were grateful. He too argued that the application of European principles meant that the tribunal had erred in distinguishing Botel and adapting the argument in Nazir. He directed out attention to the following passage in Botel which he argued showed that the question of whether an employee attending courses was 'work' was implicitly answered in the affirmative:

"Although compensation such as that at issue in the main proceedings does not, as such, arise from the contract of employment, it is nevertheless paid by the employer by virtue of legislative provisions and by reason of the existence of an employment relationship with an employee. In fact, the members of Staff Committees must of necessity enjoy the status of employees of the undertaking and they are obliged to look after the interests of the workforce, thus encouraging the existence of a harmonious working relationship within and in the general interests of the undertaking."

18. The fact that the tribunal failed to consider properly whether or not time spent on the GMB courses by the Appellant was by reason of the existence of an employment relationship, showed that they had not applied properly or at all, the decision of Botel.
19. On behalf of the Council, Mr Middleburgh submitted that Article 119 expressly defined 'pay' but not 'work' so the determination of matters arising directly out of an employment relationship is properly a question of fact. Both Botel and Lewark could be distinguished on their facts as they concerned German Staff Committees which were subject to statutory provisions, and attendance at such was a direct consequence of the existence of a contract of employment. The tribunal found as a fact that attendance at a GMB Health and Safety course was not a direct consequence of the contract of employment. It was therefore for the Appellant to demonstrate that the GMB courses were the same or similar to the system of Staff Committees in Germany, which she had not done before the tribunal. Moreover, the Appellant did not adduce evidence before the tribunal showing how attendance at the course would benefit or encourage relations with the Council. The tribunal were right, therefore, to conclude that attendance was not work and therefore not pay under Article 119.
20. It is our view that the decision in Nazir should not be followed. It was an error of law to distinguish 'pay' and 'work' as they did and to distinguish Botel. 'Pay' within Article 119 is 'pay for work' within Article 119. Botel decided that training for Staff Council functions was 'work' for the employer in the broad sense that Staff Committees safeguard staff interests and promote harmonious working relationships in the interests of the business. Whilst trade union work is not strictly comparable to German Staff Committees and there are important differences between them, they are analogous, and we do not consider that any of the differences would be so significant so as to bring the GMB training course outside the scope of Botel. Attending a training course organised by a recognised trade union is still related to the employment relationship and is safeguarding staff interests which is ultimately beneficial to the employer. Health and Safety representatives require training for the better performance of their duties. Training may be made available either by the Union or the employer. In each case the training of the representative facilitates the execution of the Health and Safety representatives' duties which is of direct benefit to the employer and fellow employees. Such a representative must be an employee and their functions and training stem wholly from their employment relationship. Attendance at the training courses is work within the meaning of Article 119 because it was by reason of the existence of an employment relationship. The tribunal therefore failed properly to apply the principles expounded in Botel and followed in Lewark that part-time female workers should be paid on the same basis as their full-time counterparts when attending training courses away from work. Any other approach would be in contradiction to the expressed purpose of Article 119.
21. In the alternative to their argument that the Appellant was not participating in 'work', it was argued on behalf of the Council that there was the question of whether Article 119 had been infringed in the absence of objective justification. Discrimination as raised in this case between part-time and full-time employees will not contravene Article 119 if it constitutes a proportionate way of furthering a legitimate aim, such as a social policy aim, which is itself unrelated to any discrimination on grounds of sex. The European Court of Justice in Lewark accepted that the German government's wish to place the independence of staff councils above financial inducements for performing staff council functions was capable of being such an aim. Subsequently, the Bundesarbeitsgericht upheld the defence of justification on the basis that Staff Council functions are performed on an honorary and unpaid basis.
22. Although the repayment of lost working hours under the Act may lead to a difference in treatment between part-time and full-time workers attending union courses, limiting repayment to reflect only contractual working hours was, it was contended in argument, justifiable on the following grounds: it preserved the independence of union representatives; it prevented the creation of professional union representatives; and it maintained the proximity between union representatives and employees.
23. In response, it was argued that whether a national policy is proportionate to its aim involved consideration of whether it was suitable and necessary for achieving that aim, in accordance with Lewark. We were urged not to take an over-elaborate position with regard to proportionality, and instead take a robust attitude towards the issue of discrimination.
24. It seems to us that although the Tribunal was not invited to deal with the question of justification we are in a position to rule on it, rather than remit the matter back. The issue in this case is not whether persons attending these courses should or should not be paid. The issue is whether part-time workers (predominantly female) engaged on a full-time course should receive full-time pay. There cannot, it seems to us, be a justifiable policy or aim which maintains the inequality. The independence of Union representatives will not be affected, since full-timers receive full-time pay. They are 'professionals' as much as or as little the part-timers and the fact that part-timers receive full-time pay when on a full-time course will not, we think, impinge on 'differentials' or lead any part-time colleagues not attending such a course to have any legitimate sense of grievance.
25. The appeal is allowed. It follows from our judgment that the 'replacement of wages' criterion in section 169(2) of the Act in relation to part-time workers is in conflict with Article 119. The Employment Appeal Tribunal must give effect to the principle of the supremacy of Community Law over domestic law. That principle was firmly established in Factortame Ltd v Secretary of State for Transport (No 2) [1991] 1 All ER 70 which requires the national court to set aside any rule of national law which conflicts with a principle of Community Law. The payment to part-timers attending courses to which section 168 of the Act applies must be governed by Article 119, as interpreted by the European Court of Justice.