Case Number: TUR1/604/ [2007]

28 March 2008

CENTRAL ARBITRATION COMMITTEE

TRADE UNION AND LABOUR RELATIONS (CONSOLIDATION) ACT 1992

SCHEDULE A1 - COLLECTIVE BARGAINING: RECOGNITION

DETERMINATION OF THE BARGAINING UNIT

The Parties:

Unite the Union

and

Central Radio Taxis (Tollcross) Limited

Introduction

1. Unite the Union (the Union) submitted an application to the CAC, dated 18 October 2007, that it should be recognised for collective bargaining purposes by Central Radio Taxis (Tollcross) Ltd (the Employer). In its application the Union described the proposed bargaining unit as “All workers below level of Departmental Manager” located at “Gilmore Place Edinburgh”. The CAC gave both parties notice of receipt of the application on 18 October 2007.  On the 7 of November 2007, the Employer submitted a response to the CAC which was copied to the Union.

2. In accordance with section 263 of the Trade Union and Labour Relations (Consolidation) Act 1992 (the Act), the CAC Chairman established a Panel to consider the case.  The Panel consisted of Professor Kenny Miller as Chairman of the Panel and Mr Dennis Cameron and Mrs Maureen Shaw as Members of the Panel. The Case Manager appointed to support the Panel was Miss Sharmin Khan.

3. By a decision dated 4 January 2008 the Panel accepted the Union’s application. The Parties then entered a period of negotiation in an attempt to reach an agreement on the appropriate bargaining unit. As no agreement was reached by the end of the relevant period, the parties were invited to supply the Panel with, and to exchange, written submissions relating to the question of the determination of the appropriate bargaining unit. A hearing was held on 27 February 2008 and the names of those who attended the hearing are appended to this decision. In accordance with paragraph 19 of Schedule A1 to the Act (the Schedule) the Panel’s task was to determine first whether the Union’s proposed bargaining unit was appropriate and then, if it was found not to be so, to determine another bargaining unit that was appropriate. In order to accommodate the hearing on 27 February 2008 and to allow time for the decision to be finalised, the Panel extended the period in which it must determine the bargaining unit to 28 March 2008.

Summary of the Union’s Submissions

4. The Union’s description of the proposed bargaining unit was “all workers below departmental manager”. The Union explained that the bargaining unit covered the following workers:

· telephonists, dispatchers and team leaders who were based in the control room and dealt with passenger bookings

and

· clerical and support staff who were based in the administration office and dealt with cash transactions from fares generated in the control room.

The Union argued that its proposed bargaining unit did not however cover the workers in the administration office who dealt with insurance claims and premiums although these workers were not excluded explicitly in its description of the proposed bargaining unit in the union’s application to the CAC.

5. The Union explained that the company had previously operated as agents for “Westminster Insurance” which was a company that provided insurance for the taxi and private hire trade in Edinburgh. The Westminster Insurance Agency was a business that had operated on the premises owned by the Employer but was separate from the Employer’s main operations. It was a distinct and separate business which dealt with insurance premiums and insurance claims for the taxi trade as opposed to dealing with passenger fares and allocation of work to the Employer’s own fleet of vehicles. In 2006 the business was moved into the Employer’s main administration office. The Union accepted the Employer’s claim that these workers were now directly employed by the Company but it did not agree that it would be appropriate to include them in the bargaining unit.

6. The Union contended that it’s proposed bargaining unit was compatible with effective management as it was identical to the bargaining unit covered by the parties’ previous voluntary collective agreement reached in 2000 and then terminated by the Employer in 2007 (the Union provided a copy of that agreement to the Panel as supporting evidence). The workers formally employed by “Westminster Insurance” were not covered by the 2000 agreement. These workers were left as a separate entity during past wage negotiations. The Union made pay claims on behalf of the workers in the control room and the administration office but not for Westminster Insurance staff. Management did not come forward with an offer to allow the Union to negotiate on their behalf and informal conversations between senior management and the Union representative led the Union to believe that the Employer had no desire to have a collective agreement covering this group of staff. The Union surmised that the Employer fought for their inclusion in the appropriate bargaining unit now to undermine support for recognition of the Union for collective bargaining.

7. The Union also believed that its definition of the bargaining unit was appropriate because it was broad enough to encompass any worker engaged in the ‘core’ business of the Company. The Employer had not provided a reason as to why the workers formally employed by Westminster Insurance should now be included other than stating that it felt the Union’s definition was incorrect. The Union maintained that its proposed bargaining unit was still compatible with effective management.

8. Finally, the Union reminded the Panel of the decision of the Court of Appeal in the Regina (Kwik-fit (GB) Ltd) v Central Arbitration Committee which held that it was the task of the CAC to determine whether the structure proposed by the Union was appropriate but that the CAC did not have to search for the most appropriate unit from those that were proposed to it.

Clarification of the proposed bargaining unit

9. In order to further assist the Panel with its findings, in addition to its written submission to the Panel prior to the hearing, the Employer produced at the hearing a list of all workers employed by the Company to date and a diagram of the company structure which showed a total workforce of 57 employees broken down as follows:

· Admin – General Manager, Assistant General Manager, Systems admin, Ops Admin.

· Customer Service – Senior Customer Service Admin, Customer Service Administrator, Sales Executive

· Accounts – Financial Admin, Invoice Admin, Assistant Admin, Pricing Assistant x 3

· Insurance – Insurance Administrator, Insurance Administrator / Mkt

· Control – Controller, Dispatcher x 9, Team Leader x 3, Telephonists x 29.

10. The Employer explained that the structure of the Company had changed since the introduction of the previous voluntary agreement and that “departmental managers” no longer existed. In about 2003 the Assistant General Manager was appointed. Each section reported to the General Manager and Assistant General Manager who both reported to the board of directors.

11. Both parties agreed that the General Manager and Assistant General Manager should be excluded from the appropriate bargaining unit.

12. The Employer informed the Panel that the workers under the category of Customer Service were essentially team leaders. Both parties agreed that these workers should be included in the appropriate bargaining unit. The same was agreed in respect of the workers under the category of Accounts.

13. The sole issue which divided the parties was whether or not the two insurance administrators should be included in the appropriate bargaining unit.

Summary of the Employer’s Submissions

14. The Employer disagreed with the Union that the previous voluntary collective agreement did not cover the insurance workers and produced at the hearing a copy of the front page of the contract of employment for one of the insurance administrators. The contract was dated 14 November 2005 and contained wording that indicated that the worker’s terms and conditions were covered by the then operative collective agreement. The Union maintained that it had not in the past negotiated on behalf of the insurance workers.

15. The Employer went on to explain that in the past a departmental manager in the accounts department handled insurance. In 2003 departmental managers were abolished and the Assistant General Manager was recruited. Some departmental managers became team leaders. In 2005 another individual was recruited to act as the Company’s representative for Westminster Insurance. Westminster Insurance was a London based insurance company as the Union had stated but Central Radio Taxis acted as agents so far as it sold their insurance policies and earned a commission in doing so. Insurance was therefore considered part of the ‘core’ business. The two insurance administrators had always been employed on the same terms and conditions as everyone else and had never held contracts of employment with Westminster Insurance. All employees except the General Manager and Assistant Manager were recruited and regarded as part of the collective bargaining unit until the agreement was terminated in 2007.

16. The Employer stated that it was not anti-union. There was no evidence to suggest that it discouraged membership of a union neither did it think that informal conversations with management could or should be used as evidence to show that it did not bargain with the Union on behalf of the insurance workers.

17. The Employer argued its case that a bargaining unit covering all employees of the company including the wholly owned Central Radio Taxis (Tollcross) Ltd insurance department (excluding the General Manager and Assistant General Manager) was compatible with effective management.

18. In the face of competition from other service providers the Employer felt that its proposed bargaining unit encouraged a stability that was required by the company to grow. The Union had not taken into account the changing structure of the Company. The management of all employees was now consistent across the company. All workers, except the General Manager and Assistant Manager used the same employee handbook and enjoyed the same career progression opportunities and the same terms and conditions of employment. The budget was distributed by the General and Assistant General Manager and applied to all employees. Location was not an issue as all offices were within a short walking distance of each other.

19. The Employer sought a team approach. The Union’s proposed bargaining unit undermined this. Workers would suffer disparities in their pay and conditions which would affect staff morale and lead to a small fragmented group attempting to bargain with the company. This would ultimately lead to poor customer service and damage to the company.

20. Finally, the Employer agreed that the Union’s proposed bargaining unit was appropriate in the past but felt that the Union should now consider the changing environment and structure of the business. It saw no reason for the two insurance administrators to be excluded from the appropriate bargaining unit.

Considerations

21. The Panel is required, by paragraph 19(2) of the Schedule, to decide whether the proposed bargaining unit is appropriate and, if found not to be appropriate, to decide in accordance with paragraph 19(3) a bargaining unit which is appropriate. Paragraph 19B(1) and (2) states that, in making those decisions, the Panel must take into account the need for the unit to be compatible with effective management and the matters listed in paragraph 19B(3) of the Schedule so far as they do not conflict with that need. The matters listed in paragraph 19B(3) are: the views of the employer and the union; existing national and local bargaining arrangements; the desirability of avoiding small fragmented bargaining units within an undertaking; the characteristics of workers falling within the bargaining unit under consideration and of any other employees of the employer whom the CAC considers relevant; and the location of workers. Paragraph 19B(4) states that in taking an employer’s views into account for the purpose of deciding whether the proposed bargaining unit is appropriate, the CAC must take into account any view the employer has about any other bargaining unit that he considers would be appropriate. The Panel must also have regard to paragraph 171 of the Schedule which provides that “[i]n exercising functions under this Schedule in any particular case the CAC must have regard to the object of encouraging and promoting fair and efficient practices and arrangements in the workplace, so far as having regard to that object is consistent with applying other provisions of this Schedule in the case concerned.”

22. The Panel’s first responsibility is to decide whether the Union’s proposed bargaining unit is appropriate. The bargaining unit as proposed by the Union was one defined as “all workers below departmental manager”. This was then revised during the course of the hearing in order to take into account of the current structure of the organisation, to be “all workers below Assistant General Manager”. However, it still excluded the two insurance administrators. The Union’s argument was simple. It argued that its proposed bargaining unit was compatible with effective management as the union believed that such a unit was the one that was already in place during the previous voluntary collective agreement.

23. As already noted, the evidence from the Employer, supported by the contract of employment of an insurance administrator, was that the previous voluntary collective agreement did include insurance workers within its sphere of operation. In addition, the Employer insisted that the insurance workers had always been employed by Central radio taxis (Tollcross) Ltd and never, as the Union believed, worked for Westminster Insurance. It may well be the case that the Union was operating from a misconception regarding the scope and extent of the previous voluntary agreement. Nevertheless, during the course of the hearing the Union confirmed on several occasions that the Union regarded the two insurance workers as outside its proposed bargaining unit.

24. The impact of the Union’s submission is that only four workers of the total complement of workers employed by the Employer are outside the proposed bargaining unit. In the case of two of these workers – General Manager and Assistant General Manager – the parties were in agreement that they were not part of the bargaining unit because of the essentially managerial nature of their responsibilities. The sole area of dispute concerns the two insurance administrators. As far as the Panel can discern, these two workers enjoy the same terms and conditions and work in the same broad location as other workers in the proposed bargaining unit. The Company’s diagram of the company structure indicated that the insurance administrators worked in their own section which had responsibility for insurance and marketing. However, it did appear that there was some flexibility within this structure to enable staff to cover for absent colleagues and all section reported directly to the General Manager/Assistant General Manager.

25. In reviewing all these issues, the Panel has concluded that the Union’s proposed bargaining unit is not an appropriate bargaining unit. It would exclude two workers from the ambit of the bargaining unit who share the same terms and conditions as the rest of the workers in the proposed bargaining unit and whose direct line managers are the same as the rest of the workers. It is also possible that the Union’s unit is based upon a misconception regarding the operation of the previous voluntary agreement. In any event, it is the view of the Panel that the Union’s proposed bargaining unit is not compatible with effective management. The Panel therefore believes that a bargaining unit which covers all workers employed by the Employer (including insurance administrators) other than the General Manager and the Assistant General Manager an appropriate bargaining unit. Such a bargaining unit has the added advantage of avoiding a small fragmented bargaining unit which the omission of the two insurance administrators would undoubtedly create.

26. The Panel has also considered the matters listed in paragraph 19B(3) of the Schedule so far as they do not conflict with the need for the bargaining unit to be compatible with effective management in particular the desirability of avoiding small fragmented bargaining units within the undertaking. The Panel has taken into account the views of the parties as summarised in this decision. The Panel is satisfied that there are no operative national or local agreements covering the Company’s employees, and that there are no other relevant issues relating to the characteristics of the workers or to location beyond those which it has taken into account.

Decision

27. The Panel concludes that the Union’s proposed bargaining unit is not appropriate and believes that a bargaining unit which covers all workers employed by Central Radio Taxis (Tollcross) Ltd (including insurance administrators) in Gilmore Place except the General Manager and Assistant General Manager is an appropriate bargaining unit.

28. As the appropriate bargaining unit differs from the proposed bargaining unit, the Panel will proceed under paragraph 20(2) of the Schedule to decide if the application is invalid within the terms of paragraphs 43 to 50 of the Schedule.

Panel

Professor Kenny Miller – Chairman of the Panel

Mr Dennis Cameron

Mrs Maureen Shaw

28 March 2008
Appendix

 Names of those who attended the hearing:

For the Union

Pat Rasserty – Senior Regional Organiser

Sandy Smart – Regional Industrial Organiser

For the Employer

Ian Robertson – Director

Alistair Girvan – General Manager

Andrew Smith – Employment Advisor