United Kingdom Employment Appeal Tribunal

APPEARANCES

 

For the Appellant	MR ROBIN WHITE (of Counsel) MESSRS RUSSELL JONES & WALKER Swinton House 324 Gray's Inn Road London WC1X 8DH
For the Respondent	LAURA ELFIELD (of Counsel) MESSRS VIZARDS OLDHAM 42 Bedford Row London WC1R 4JL


 


HIS HONOUR JUDGE WILSON

1. This has been the hearing of the full argument in the appeal by the original Applicant who complained that his employer the Respondent had made unlawful deductions from his wages. He has been represented today by Mr White of Counsel and the Respondent by Ms Elfeild of Counsel who appeared in the Tribunal below. On that occasion the Chairman sitting alone dismissed the Applicant's application.
2. When the matter came forward for preliminary hearing another division of this Tribunal permitted full argument to go forward on only two of the grounds pleaded in the Notice of Appeal. The first was a ground set out in paragraph 6.4 and asserted that the Employment Tribunal erred in law in holding that mere silence and inactivity on the part of the Appellant's Trade Union was capable in law of amounting to the acceptance of an offer by conduct. The other ground for full argument was set out in paragraph 6.5 and asserted that the Employment Tribunal erred in law in that it held that conduct by the Appellant's trade union falling outside the machine for negotiation and occurring after the exhaustion of the agreed procedure was capable in law of creating a collective agreement binding on the Appellant.
3. Those are the matters which have been before us and the background to the matter may be shortly stated. The Appellant has been employed by the Respondent and by their predecessors in title for many years. There came a time when, as part of the annual pay round, the Respondent wished to convert everybody to payment by credit transfer at four weekly intervals. They therefore offered a pay increase of 3% with a further .8% if the matter was accepted by the workforce. The total on the table therefore across the board was 3.8%. There were collective arrangements including amongst other things pay bargaining arrangements, with a number of unions to one of which the Appellant belonged.
4. The proposal was accepted by other unions and implemented in full. It was not accepted so far as the Appellant's union was concerned because of a disagreement over an element of the membership as to whether they should or should not be covered by the proposed arrangements. No industrial action followed and the proposal was in fact implemented with regard to all their membership as well. In the end the only person refusing to supply his bank details was the Appellant.
5. The Chairman in his lengthy decision summarised the issue in paragraph 13: -

"…it has always been perfectly clear that the Applicant did not want to go onto four-weekly cashless pay, and the Respondent was maintaining that an agreement had been reached entitling them to impose this condition. There has been virtually no dispute on any of the relevant facts in this case, and the general issues have been aired over the course of a day and a half."

He went on to observe that the case was brought under section 13 and 23 of the Employment Rights Act 1996. In paragraph 17 he said: -

"what is important, and what is not in dispute, is that the contract, specifically paragraph 2, (that is the contract of employment) gives the right to the relevant trade unions to make agreements concerning the employees remuneration. It is clear, therefore, that it is not open to this Applicant, or indeed to any single employee, to make his own individual arrangement with regard to remuneration with the Respondent."

In paragraphs 21 – 25 the Chairman went on to say: -

"there was an offer of an increased pay award provided that the employees, through the unions, converted to four-weekly cashless pay. The RMT agreed to this, and it was implemented so far as their members were concerned. The TSSA did not agree to it on the basis that the award did not include the administrative and support clerical staff (R17).

All the relevant parties were aware that the RMT was regarded as the militant union, and the TSSA was not so regarded. In the past, when one union had not agreed to the pay proposals, the Respondent has nevertheless implemented them. In this present case, although Mr Anderson (the TSSA representative) had not specifically agreed the proposals, he expected Mr Meadows (the Respondent) to implement them and when this was done, Mr Anderson raised no further complaint.

So far as the TSSA was concerned, there was therefore a unilateral variation to the terms relating to the remuneration and method of payment of its members. This variation was accepted by the union by its conduct in failing to raise any further queries, or failing to take any other action once the implementation had been imposed. Furthermore, all the relevant employees, except the Applicant, accepted the variation by providing their bank details and accepting the four-weekly payments.

"…the offer was clearly made and there was clear acceptance by conduct and the TSSA's decision not to pursue their objection.

It follows that the Applicant is bound by the contractual arrangements made, in relation to his own remuneration, by his union. Those contractual arrangements were simply a pay rise of 3.8% backdated to 5 April 1998 on condition that the payments would be made on a four-weekly basis by way of credit transfer to an appropriate account, with the employees providing the appropriate details"

6. Those were the material findings by the Chairman and there is no dispute that in fact the Respondent has been paying the Appellant's wages into a bank account opened for the purpose having dealt with his tax liabilities and tax and other liabilities beforehand.
7. Mr White and Ms Elfield have provided skeleton arguments which are to be embodied as part of this judgment because they have relied on those arguments, amplified to some extent in the following ways.
8. Mr White submitted in amplification of his skeleton argument that there was nothing in the facts found by the Tribunal concerning the 1998 pay round which can amount to acceptance of the change in payment methods so far as the TSSA is concerned. The findings of fact are not challenged and he goes on to point to the several references to non acceptance contained in paragraph 5 of the extended reasons. He went on to submit that collective agreement just cannot be spelled out of a failure to agree and subsequent acquiescence.
9. Secondly, he said that there was a contractual right here to be paid in cash and nothing had been inserted in the contract to allow cashless payment. He submitted that not providing a pay envelope and putting money into the bank as a credit transfer without the contracted agreement of the Appellant amounted to a deduction.
10. Ms Elfield submitted in amplification of her skeleton argument that there were three questions. The first was whether there was an unlawful deduction. If there was a deduction was it within the scope of the contract anyway? If not was there a valid collective agreement? She submitted that since money was tendered and indeed paid into an account specifically in the Applicant's name, there was in fact no deduction. It was, she said, a demand for compensation for a lost right which seemed to be the matter which exercised the Appellant. That was not covered by the provisions of sections 13 or 23 of the Employment Rights Act. If it was covered at all, it should have been the subject of an action for breach of contract. That was not before the Tribunal and it is not before us. She also asked the question whether, if there was a unilateral variation, there was any detriment. She submitted that there was a joint agreement and that there had been full negotiation. After that either there was agreement or there was a failure to agree. If there was failure to agree the only action was industrial action.
11. We make the preliminary observation that in view of the nature of the issues in this case, for the Chairman to have sat with lay members would have been fruitful. The Chairman's legal knowledge would have been enriched by the industrial wisdom and experience of pay bargaining situations of his lay colleagues. We debated whether that was a sufficient ground to send the matter back to be considered by a full Tribunal, but we concluded that the deficiency was remedied by the fact that this is a full Tribunal informed by the joint wisdom and experience on both sides of the industry which is possessed by the lay members of this Tribunal. We have therefore examined the Chairman's decision in the light of the submissions and the skeleton arguments and in the context of the relevant parts of the judgment of the Scottish Employment Appeal Tribunal in the case of Edinburgh Council –v- Brown (1999) IRLR 208.
12. There is no dispute about the facts and the first question is whether there was a collective agreement here. It seems that there is no dispute about the existence of such an agreement. We note the definition from the statute which is conveniently expressed in paragraph 18 of the Edinburgh –v- Brown judgment:

""Collective agreement" means any agreement or arrangement made by or on behalf of one or more trade unions and one or more employers or employers' associations relating to one or more of the matters specified below … which includes "terms and conditions of employment.""

13. In this case there was undisputed evidence that, on previous occasions when a proposed pay bargain had not been accepted by all the unions concerned, it had nevertheless been implemented. No industrial action had followed because the matter was acquiesced in by the union which did not positively agree and was accepted by its members. There was undisputed evidence that both sides of the industrial table knew of those previous occasions and that the TSSA representative expected that to happen as indeed it did in this case.
14. That seems to us to be an industrial device of which the industrial experience sitting on this Tribunal is aware and which is widely found and comes within the term "arrangement" for the purposes of the Act. We therefore have no doubt that there was a collective agreement and arrangement to which all staff, one way or another, were subject. That leads on to the second question which is whether, where there is such a collective agreement, the individual union member retains an individual right of veto if he personally does not agree with what is negotiated on his behalf or acquiesced in on his behalf.
15. Relying upon the industrial wisdom of this Tribunal's lay members, we find unanimously that individual rights are abdicated when a collective agreement exists. For the situation to be otherwise would result in industrial chaos. It seems to us that it must follow that the individual right is subsumed by the collective bargaining power.
16. We come to the final question, which is what deduction has been made? In this connection we had regard to Mr White's submission that the failure to present money in a pay packet is not remedied by putting money in the bank. We disagree and reject that submission. We uphold the Chairman and find that there was no unlawful deduction from pay.
17. Accordingly we uphold the decision and the appeal fails.