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24/04/2024

Inducements relating to collective bargaining – Smith & ors v London Ashford Airport Limited

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Introduction

The Employment Tribunal handed down judgment in Smith & ors v London Ashford Airport Limited on 10 April 2024.

EJ Richard Wood held that the Airport had breached s.145B of the Trade Union and Labour Relations (Consolidation) Act 1992 by offering pay increases directly to 9 members of Prospect, the trade union recognised by the Airport for collective bargaining purposes. The Tribunal’s judgment provides a helpful application of the interpretation of s. 145B in the Supreme Court’s decision in Kostal UK Ltd v Dunkley and ors [2021] UKSC 47 and the EAT’s decision in Ineos Infrastructure Grangemouth Ltd v Jones & ors and Ineos Chemicals Grangemouth Ltd v Arnott & ors [2022] EAT 82. Under s. 145B employers are prohibited from making offers to employees who are members of a recognised trade union which, if accepted, would have the result that one or more terms of their employment will not, or will no longer, be determined by collective bargaining (the “prohibited result”), if the employer’s sole or main purpose in making the offers is to achieve the prohibited result. Where liability is established, the ET must make a prescribed award (£4,554 at the time the claim was presented) to each member to whom the offer is made.

Background facts

The Claimants were air traffic controllers who had not had a pay rise since 2018. Under a Recognition Agreement, the Airport had committed to negotiate with Prospect on pay each year from September, with the option of holding a meeting with Acas if negotiations were not successful. From September 2022, Prospect repeatedly attempted to initiate pay negotiations but was rebuffed by the Airport. In January 2023, the Airport served a 6-month notice of termination of the Recognition Agreement. On 21 February 2023, the Airport sent notices to the Claimants announcing pay rises of 2% in April 2023 and 3% in September 2023 and anticipated 2% pay rises in April and September 2024. On 1 April 2023, the Airport sent letters to the Claimants informing them that with effect from 1 April 2023 their salaries would be increased and asking them to sign the letter to accept the changes to their terms of employment. The pay increases were applied to the Claimants’ wages from April. At Prospects’ suggestion, in May and June the Airport attended two meetings with Acas to discuss the de-recognition notice and pay rises. However, the Airport refused to continue to voluntarily recognise Prospect and no agreement was reached about pay rises. Upon the notice of termination expiring, Prospect successfully applied to the CAC for statutory recognition. On 28 September 2023, the Claimants were notified that the Airport would not continue to consider pay increases “in light of the recent Employment Tribunal claim”. Accordingly, the Claimants did not receive the pay rise in September 2023 that they had been promised in the 21 February 2023 notice.

The Airport denied that the 1 April 2023 letters were ‘offers’ under s. 145B as they merely repeated the content of the 21 February 2023 notice; that the acceptance of the offers had the prohibited result; that its sole or main purpose in making the offers was to achieve the prohibited result.

Judgment

The ET upheld the s. 145B claims in respect of both offers, finding that the Airport had decided to bypass pay negotiations with Prospect. The total award was £72,864.

The ET found:

• It did not follow from the fact that the 1 April 2023 letters were “nothing more than an implementation” of the 21 February notice that they were not capable of amounting to s. 145B offers. Using the terminology from Ineos, the ET held that the letters were “a statement of intent to vary the employees’ contracts as to pay”.
• Following Kostal, the test for whether the offers achieved the prohibited result is one of causation, namely whether there is a real possibility that the matter would have been determined by collective agreement if the offers had not been made and accepted. This would ordinarily be the case where the employer makes an offer directly to the workers before the agreed collective bargaining procedure has been exhausted. Applying this, the ET found that the collective bargaining process had barely commenced when the Airport made the offers directly to the Claimants; prior to the offers being made there had not been any meaningful discussions about pay and Prospects’ requests for meetings to discuss pay had been rejected by the Airport.
• The following evidence showed that the Airport’s main and probably sole purpose in making the offers was to achieve the prohibited result: the Airport’s decision to issue notice of termination of the Recognition Agreement before pay negotiations had commenced, shortly before sending the 21 February 2022 notice to the Claimants  and 3 days after Prospect had proposed a meeting with ACAS (echoing the facts in Ineos), and the reasons for derecognition provided by the Airport’s lawyers in a letter to Prospect were “a fiction, bearing little relationship to what was actually happening”.

Click here to read the full judgment.

Camille Ibbotson of Old Square Chambers acted for the successful Claimants and was instructed by Iain Birrell of Thompsons Solicitors LLP on instructions from Prospect.