C1/2004/2563
Neutral Citation Number:
[2005] EWCA Civ 1309
IN THE SUPREME COURT OF
JUDICATURE
IN THE COURT OF APPEAL (CIVIL
DIVISION)
ON APPEAL FROM THE HIGH COURT
OF JUSTICE
QUEEN'S BENCH DIVISION
ADMINISTRATIVE COURT
(MR JUSTICE HODGE)
Royal Courts of Justice
Strand
London, WC2
Thursday, 21st July 2005
B E F O R E:
LORD JUSTICE BUXTON
LORD JUSTICE LATHAM
SIR MARTIN NOURSE
- - - - - - -
THE QUEEN ON THE APPLICATION
OF
THE NATIONAL UNION OF
JOURNALISTS
Claimant/Appellant
-v-
(1) CENTRAL ARBITRATION
COMMITTEE
First Defendant/First
Respondent
(2) SECRETARY OF STATE FOR
TRADE AND INDUSTRY
Second Defendant/Second
Respondent
(1) SPORTS DIVISION - MIRROR
GROUPS NEWSPAPERS
First Interested Party/Third
Respondent
(2) BRITISH ASSOCIATION OF
JOURNALISTS
Second Interested Party
-
- - - - - -
(Computer-Aided Transcript of the
Palantype Notes of
Smith Bernal Wordwave Limited
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Tel No:
020 7404 1400 Fax No: 020 7831 8838
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-
- - - - - -
MR J HENDY QC and MISS J EADY
(instructed by Thompsons, London WC1B 3LW) appeared on behalf of the Appellant
Claimant
MISS DINAH ROSE (instructed by Treasury Solicitors,
London SW1H 9JS) appeared on behalf of the First Respondent/First Defendant
MR JASON COPPEL (instructed by Treasury
Solicitors, London SW1H 9JS) appeared on behalf of the Second
Respondent/Secretary of State
MR TOM LINDEN (instructed by Lovells,
London EC1A 2FG) appeared one behalf of the Third Respondent/First Interested
Party
-
- - - - - -
J U D G M E N T
(As approved by the Court)
-
- - - - - -
Crown copyright©
1. LORD JUSTICE BUXTON: This appeal from Hodge J is another case
about the statutory provisions for the recognition of trade unions by
employers, as authorised and negotiated on behalf of workers in a bargaining
unit, in respect of which the Trade Union and Labour Relations Act 1992 (as amended)
provides that in default of agreement between employers and workers certain
adjudicative and advisory functions should be performed by the Central
Arbitration Committee ("the CAC").
I think it unlikely that anyone who is minded to read this judgment will
not already be well aware of the role and functions of the CAC. However, for anyone who is not, a lucid
account is to be found in paragraphs 5 to 10 of the judgment of Elias J,
appended to the judgment of this court in R (Kwik-fit (GB) Ltd) v Central
Arbitration Committee [2002] ICR 1212, 1221 to 1222. The judge there refers to Schedule A1 to the
Act, which provides a detailed scheme in circumstances where the union is
refused recognition by an employer. The
union can then apply to the Central Arbitration Committee to decide whether
that union has the support of the majority of workers in a bargaining
unit. Perhaps should be mentioned,
because it is marginally relevant to this case, that the requirement is for
support of a majority of the workers. It
is not necessary for the union to have a majority of membership within that
unit.
2. We are concerned in this case with
paragraph 35 of the scheme, which renders certain such applications
inadmissible and therefore outwith the jurisdiction of the CAC. Paragraph 35(1) reads as follows:
"An application ... is
not admissible if the CAC is satisfied that there is already in force a
collective agreement under which a union is (or unions are) recognised as
entitled to conduct collective bargaining on behalf of any workers falling
within the relevant bargaining unit."
3. The facts of this case are very clearly
set out in paragraphs 1 to 4 of the judgment of Hodge J:
"1. The National Union of Journalists (NUJ) has
members who work for Mirror Group
Newspapers (MGN). In the spring of 2003,
it seemed likely that MGN would start publishing its Racing Post newspaper
seven days a week. This would mean a
change in the terms and conditions of journalists working in the Sports
Division of MGN. The membership of the
NUJ within the Division increased. No
union was recognised by management to collectively bargain on behalf of staff
within the Division. Discussions began between NUJ and MGN. They seemed to be going well. At the NUJ, the negotiators clearly thought a
recognition agreement was to be signed with the union.
2. MGN has over 600 journalists working for its
other titles. It has a recognition
agreement with the British Association of Journalists (BAJ) for other national
titles. That union has about 140 journalists
in membership working in those other titles.
BAJ was formed in the early 1990s.
It was and is a breakaway union from the NUJ. BAJ is an independent
trade union but is not affiliated to the TUC. It can be reasonably inferred
from this case that the two unions do not get on. At the time of the hearing before the CAC the
BAJ had at most one member who worked within the Sports Division of MGN. The NUJ had members representing probably
more than half of the journalists working within that Division. But the NUJ has
no recognition agreement of any sort with MGN in any of its national Divisions.
3. On 3rd July 2003 BAJ signed a recognition
agreement with MGN under which BAJ obtained exclusive negotiating rights with
MGN for journalists in the SportsDivision.
No notice of this possibility had been given to the NUJ. The NUJ was shut out from negotiating with
MGN. The NUJ was no doubt furious about
this. The Central Arbitration Committee
(CAC) to whom this issue was referred describes the treatment of the NUJ as
shabby. It was certainly unsporting.
4. The CAC conducted a hearing and decided that
the application for a recognition agreement made by the NUJ was not
admissible. The NUJ challenges the
lawfulness of that decision. MGN Ltd, as
interested party, is the main respondent to this application. The BAJ did not
appear and was not represented. The CAC appeared to address the court on human
rights issues alone."
4. In considering the decision of the CAC
and the apparently unusual outcome of it, it is relevant to remind ourselves of
what the CAC said in paragraph 42 of its determination:
"We are comforted by two
matters in reaching this negative conclusion on the question of support for the
voluntarily recognised union. The first is that it coincides with the
traditional understanding of voluntary recognition."
They then quote from Deakin
and Morris Labour Law, 3rd edition, at page 765 in the following terms.
"A further, and less
commented on, consequence of the voluntary nature of trade union recognition is
that there is no mechanism to control the employer’s choice of union. Thus,
there is nothing to prevent an employer recognising a union which may have only
minimal support among the workforce."
5. The CAC continued:
"Second, and more pertinent,
is the emphasis placed in the White Paper which preceded the introduction of
the statutory recognition procedure on the desirability of taking inter-union
disputes outside the scope of the Panel's jurisdiction."
6. However, having said that, the CAC indicated
that it was very far from satisfied about the outcome that its application of
paragraph 35 had produced. It said this
in paragraph 43 of its determination, immediately after the passage that I have
just read:
"43. Nevertheless, we should like to put on record
our firm belief that the exclusionary rule contained in paragraph 35 has not
achieved justice in this case. The
employer has been able to defeat what are in all probability the wishes of a
majority of the relevant workforce by the simple expedient of concluding a
voluntary recognition agreement with a wholly unrepresentative union. It may be said that the principle of avoiding
CAC adjudication upon inter-union disputes was regarded by Parliament as more
important than the principle of providing collective bargaining where a
majority of the appropriate workforce desire it. Even accepting that, we think this case
displays a lacuna in the legislation.
Were the BAJ a non-independent trade union, which it is not, its
recognition by the Company could be challenged under Part VI of the
Schedule. Were the BAJ affiliated to the
Trades Union Congress, which it is not, the NUJ could have recourse to the
procedures of the TUC to bring about a resolution of the issues raised by the
case. Since the BAJ is independent but
not affiliated, the defeated majority union has no avenue of potential redress,
once it is excluded from the statutory recognition process. This seems to us highly unsatisfactory."
7. But the nub of the matter, as the CAC
recognised in those two passages, was that once the union with which the
employer had concluded the agreement was indeed an independent union (as there
is no doubt that the BAJ is), then the CAC had, and this court has, to apply
the wording of the scheme including paragraph 35. Before the CAC and before the judge a range
of matters were argued in relation to the proper construction of paragraph
35. But before us the argument came down
to an argument about the meaning of the words "already in force" in
that paragraph.
8. As to the agreement itself, it is not
necessary to set out the whole of it. It
starts with a number of, if I may be permitted say so, wholly proper, though
possibly aspirational, intentions in the relationship between MGN and BAJ, and
then comes in paragraph 4 to a paragraph headed "union
recognition". It is necessary to
set that out because it plays a part in the argument in this case:
"'By this agreement MGN
formally recognises the rights of the BAJ union and no other organisation
..."
and then there is a series of
bullet points, of which I need only read, I think, the first two:
"• to negotiate changes
to pay, hours and holidays on behalf of the employees within scope
• to
be informed and consulted about training plans and any other changes involving
redundancies or the transfer of an undertaking affecting the employees within
scope."
9. Clause 7(1) relates to negotiating
procedure, harking back to the first of the bullet points just referred to, and
says:
"7(1) The parties will
negotiate on pay, hours and holidays within the scope of this agreement in an
open and constructive manner and keeping with the spirit of this agreement
(2) The procedure for handling proposals from
either party is set out at appendix B."
10. If we turn to appendix B we find a scheme
for the creation of a Joint Negotiating Committee, with a chairman rotating
between both sides and various other structural arrangements for the
composition of the JNC which appear to be of a familiar nature.
11. Against that background I turn to the
question of construction: what is meant by the agreement being "already in
force"? As a matter of normal legal
or contractual understanding, I would think that an agreement is "in
force" when it can be shown to be binding on the parties to it. No one has been able to point to any
authoritative, or indeed any, exposition of the meaning of this phrase in
general contractual practice, nor have the court's own researches revealed
anything of that sort. But that, in my
estimation, is straightforwardly what contract lawyers would understand by the
statement that an agreement was in force.
Yet the NUJ as part of its case argued that since collective agreements
are not legally binding, contractual analysis in a circumstance like this is
inappropriate. But, for my part, I would
think, first, that the understanding that collective agreements are not legally
binding only applies to the enforcement of those agreements and not to their
formation; and I am fortified in that view by it being the same as that of the
expert CAC, as stated in paragraph 44 of its determination. Secondly, and in any event, contractual
analysis must at least provide a strong analogy when one is looking at an
agreement such as this, and indeed some of the submissions, and in particular
the first submission of Mr Hendy QC for the NUJ, did draw on contractual
theory.
12. The CAC itself accepted that the fact that
the parties considered themselves to be bound was not conclusive as to whether
the agreement was in force, but subject to that, as I would think, they agreed
with the approach that I have just ventured to suggest. I draw that from paragraphs 47 and 48 of
their determination, addressing in fact a submission by Mr Linden for MGN,
which he will forgive me for not setting out.
The CAC said this in paragraph 47:
"We think it must be open
to a Panel to conclude in an appropriate case that the parties, by inaction,
have abandoned a recognition agreement, even if they also convince the Panel that
they believe otherwise. If actions speak
louder than words, we think they (or rather inaction) also speak louder than
beliefs, at least in some contexts."
13. The CAC, however, went on to say that that
was not this case. They said this in
paragraph 48:
"We think that in this
case the normal rule applies and that the recognition agreement came into force
on July 3, upon the signatures of Mr Turner on behalf of the BAJ and Mr Budd
and Mr Reed, who signed on behalf of MGN."
14. The CAC then went on say that Mr Hendy had
submitted before them that there were features of this particular recognition
agreement which made its coming into force dependent on the satisfaction of
certain conditions which have not in fact been fulfilled. They were under the impression that Mr Hendy
had not developed those submissions. He
assures us that he indeed did so, and whatever the rights and wrongs of that he
has certainly been free to and has developed those submissions before this court. It is to those that I must now turn.
15. The first submission, which was related to
the main argument but was not the same as it, was that the creation and indeed
coming into operation of the Joint Negotiating Committee was a condition
precedent to the coming into force of the agreement. I cannot agree. Firstly, that is not what the agreement says
or can be interpreted as saying. That is
not my view only, but also that of the CAC, who said at the end of paragraph
48, in relation to Mr Hendy's arguments sketched out at least before them:
"... we have not be able
to read the recognition agreement in the way suggested [by counsel]."
Nor, with respect, can I.
16. Secondly, and in any event, such an
interpretation would be extremely unlikely in an industrial relation context,
because it would potentially produce uncertainty and conflicts if an agreement
was made between the parties, but then said not to be in force until some step
was taken. The CAC addressed the
industrial relations realities of such a situation in paragraph 45 of its
determination. True it is that there it
was addressing an argument advanced by Mr Hendy somewhat different from that
which I am dealing with at the moment; that is to say, that implementation of
the agreement at large had to take place before it could be said to be "in
force". But the practical force of
the condition precedent argument is just the same as the practical force of Mr
Hendy's implementation argument that he raised before the CAC but not before
us. The CAC said of that:
"We think that the employer
... would receive short shrift from the union it recognised in March if it
recognised a different union in April and justified its actions to the first
union on the grounds that the first union's recognition agreement was not in
force when it was signed."
That, if I may say so, seems
self-evident. The condition precedent
argument therefore does not, in my judgement, run.
17. Mr Hendy, however, put the case in a
different way before this court in particular in paragraphs 25 and 26 of his
skeleton argument which I will venture to set out:
"25. It is not submitted
that such an entitlement [that is to say the entitlement to negotiate] needs to
have been exercised in order to satisfy the CAC that the agreement is already
in force. However, if the entitlement
has not yet been exercised, it is submitted that it is then incumbent on the
CAC to consider whether:
(a)
there is a real and genuine intention on the part of both parties that
the entitlement to negotiate will be exercised; and
(b)
the entitlement to negotiate is reasonably capable of being exercised;
and
(c)
there is a real prospect that the entitlement to negotiate will be
exercised on a reasonably certain future date or on the happening of a
specified likely event; and, in any case, in the reasonably near future.
26. It is submitted that on
the facts of the present case none of the three conditions specified could be
fulfilled."
18. Expanding on or possibly summarising those
submissions, Mr Hendy said to us that "in force" meant more than that
there was simply an agreement. That
agreement must be reasonably capable of being operated and have reasonable
prospects of being so operated.
19. That formulation and the points listed in
Mr Hendy's skeleton argument, to which he said the CAC should have had regard,
comes in my view very close, at least in this case, to suggesting that the
agreement was in fact a sham. When
pressed on that point I did not understand Mr Hendy to resile from such a
contention, at least in the sense of saying that it was known that the
agreement would never work.
20. But whatever arguments that were or were
not put to them, it is clear that the CAC were very unenthusiastic indeed about
this agreement, and alert to the possibilities of paragraphs 35 being
misused. They heard evidence from the
people who made the agreement, and they were best placed to determine (and I
have no doubt that if they thought it justified would have determined) whether
or not that agreement was a sham. There
is no basis on which this court can make such a finding or come near to doing
so.
21. Once it is agreed, or at least accepted,
that the agreement is genuine, albeit being used to an end that paragraph 35
did not envisage, the additional requirements argued for by Mr Hendy simply
cannot stand up. As the CAC held, there
may come a time when failure to act or impossibility cause the agreement to
collapse or force a tribunal to say that it has collapsed. But unless the possibility of the agreement
operating is simply not believed in by the parties to it, and as we have seen
the CAC did not so find, it is wrong as a matter of contract, or indeed as a
matter of logic, to say that an agreement does not come into present force
simply on the basis of doubts about its future viability.
22. That makes it strictly unnecessary to go on
to the dispute between the parties as to whether this agreement had in fact
been operative. That question is,
however, relevant because if the agreement is being operated, it must follow as
a matter of necessity that it is "in force", whatever the
understanding of that expression might be.
23. The CAC heard some evidence about this and
made some findings about it. They said
in paragraph 50 of their determination:
"The heart of the July
agreement is contained in its clause 4, where the 'MGN formally recognises the
rights of the BAJ union and no other organisation' to negotiate on a list of
matters, including changes to pay, hours and holidays and proposed
redundancies. Mr Turner of the BAJ has
sought recently to deal on behalf of the Sports Division journalists in respect
of two matters falling within that list (the proposed redundancies and the move
to seven-day publication) and MGN has discussed these matters with him - and,
just as important, has refused to discuss them with the NUJ. This seems to us to be evidence of attempts
to make the July agreement work, albeit in a halting way, rather than evidence
of abandonment or suspension."
That on its face was evidence
that the CAC was entitled to accept which went against any suggestion that the
agreement was a mere shell or something that nobody was going to take any
notice of.
24. Mr Hendy argued that the evidence was
irrelevant. As I understood it, the
submission was this. Paragraph 35
requires a "collective agreement" for collective bargaining to be in
force. Section 178 of the Act refers to
specific matters that are covered by a collective agreement and by the
bargaining process. The only part of the
agreement in this case that referred to bargaining was the first limb of clause
4(1). The second limb of clause 4(1),
apparently dealing with redundancy, did not extend to bargaining or
negotiation. No bargaining or
negotiation had taken place between MGN and BUJ on the matters referred to in
the first limb of clause 4(1); that is to say, pay and holidays.
25. I fear I have to say that I think that that
objection is too refined. All that the
CAC was looking for, and all that it needed to look for, was an earnest desire
to work within the agreement; not evidence that any of its specific provisions
had in fact been carried out. Granted
that the agreement was in existence, the evidence that the parties had dealt
according to any of its terms, even if those were not the terms that gave it
its status as a collective agreement, was in my judgement sufficient to show
that the written agreement, genuinely signed up to, was not merely a piece of
paper.
26. I would therefore uphold the CAC and the
judge on this part of the case. I turn
to the arguments raised on the European Convention on Human Rights.
27. Before the CAC and the judge, the NUJ
asserted its rights of association under Article 11 of the Convention and said
that they were being interfered with by the refusal of MGN to negotiate with
them, and the fact that MGN were able to use paragraph 35 to that end.
28. The only case that was relied on for the
proposition that that situation fell under Article 11 was Wilson v United
Kingdom (2002) 35 EHRR 513. Mr Hendy
relied on paragraph 42 of that determination, and in particular the words:
"A trade union must thus
be free to strive for the protection of its members' interests, and the
individual members have a right, in order to protect their interests, that the
trade union should be heard ..."
29. That, it was said, demonstrated that a
right to negotiate on the part of the trade union was part of the Article 11
rights of its members. That was plainly
not what the court thought. It went on
in that very paragraph to say:
"Article 11 does not,
however, secure any particular treatment of trade unions or their members and
leaved each State a free choice of the means to be used to secure that right to
be heard ..."
30. It then went on in paragraphs 43 and 44 to
expand on that view, and in particular said in paragraph 44:
"The Court has not yet
been prepared to hold that the freedom of a trade union to make its voice heard
expends to imposing on an employer an obligation to recognise a trade
union."
31. That the court has still not been prepared
to take that step is demonstrated by the admissibility case of Popov v
Bulgaria, application number 48047/99, drawn to our attention by the
industry of Mr Coppel who represents the Secretary of State. In that case, on page 15 of the ruling, the
court said this:
"The court notes that the
Convention does not per se guarantee to trade unions the right to collective
bargaining."
and for that point it quoted Wilson
v National Union of Journalists.
32. It is clear to me, as I believe it to have
been clear to the constitution of this court that gave permission for this
appeal, that the right to be recognised for the purposes of collective
bargaining does not fall within the rights guaranteed by Article 11.
33. Before us, however, the Convention was
deployed in a different way, to say that the NUJ might be able to take
advantage of a combination of their rights under Article 11 and Article 14, the
prohibition against discrimination. This
point was not raised either before the CAC or before the judge below, and
therefore we have the disadvantage of not enjoying their considered view on it;
the argument being, in brief terms, that it was discriminatory to afford the
rights of negotiation to the BAJ but not to the NUJ.
34. Both MGN and the CAC were prepared to
concede, and did concede, that the facts of this case fell within the
"ambit" of Article 11 for the purposes of the application of Article
14. That may have been a generous
concession. The question of what is
meant by the ambit of a particular Article of the Convention is far from clear,
at least in the jurisprudence of this jurisdiction. It had been hoped that the House of Lords in
the case of Ghaidan v Mendoza [2004] 2 AC 557 would find itself impelled
to give guidance on that subject, but in the events that occurred it did not
need to do so.
35. It does at least seem clear, though not
actually decided by anybody, that the optimistic view of the "ambit"
of a Convention right that was adopted by at least one of the judges in this
court in Ghaidan is not correct.
But what the right answer is is not at the moment clear, and one is
bound to say that there is some paradox in saying that a factual situation that
has been authoritatively held not to fall under Article 11, nonetheless comes
within the ambit of Article 11. However,
be that as it may, that concession was made and we of course respect it.
36. The obvious difficulty facing the NUJ in
this case is to point to any action by the state that has discriminated against
them. They may well say that they have
been discriminated against by MGN, but MGN is not the state or a
state-supported body.
37. Mr Hendy at the end of his submissions
therefore reformulated the case in this way:
"By precluding a
representative trade union from using the statutory procedure, the legislature
is actively impeding the right of the employees to be heard through the negotiating
procedure. The State has permitted that
state of affairs through the terms of paragraph 35."
38. I have to say that I find that formulation
and that description of this case wholly artificial. This case is completely different from the
only case that comes even remotely near to it, the closed shop case of Young
and others v United Kingdom. In that
case, once the European Court of Human Rights had managed to find a right of
non-association lurking within Article 11 it had no difficulty in holding that
the state was responsible for legislation that allowed, and some would say
encouraged, the punishment of workers for their exercise of that right. But in this case paragraph 35 is not limiting
or punitive, or aimed at a particular category of workers, but it is
even-handed in according primacy to existing voluntary agreements.
39. I would venture respectfully to adopt in
that respect paragraph 35 of the skeleton argument of Miss Dinah Rose, on
behalf of the CAC, which read as follows:
"Even if there were a
difference in treatment, the appellant has failed to identify any ground for
that difference in treatment which falls within the ambit of Article 14. The reason why the NUJ is denied access to
the statutory recognition procedure in paragraph 35, is not because of any
particular feature or status of the NUJ to which the legislation is
hostile. It is merely because another
union has already entered into an agreement with the employer. The result would be identical if it were the
NUJ which had entered into an agreement and the BAJ was seeking statutory
recognition. This treatment does not
disclose any discrimination within the ambit of Article 14."
40. In my view, all that can be said, and
indeed is said, is that the state should take positive steps to prevent the use
of paragraph 35 in the way in which MGN has used it in this case. But there are at least two objections to
that. First, it is inconsistent with the
guidance given in the Wilson case as to the obligations of the state
with regard to collective bargaining.
Secondly, a failure to take that general step cannot possibly be
characterised as an act of discrimination by the state against the National
Union of Journalists, and it is that, and not some general issue of the
character of the scheme as a whole, that has to be established under Article
14.
41. I would dismiss this appeal.
42. LORD JUSTICE LATHAM: I agree.
43. SIR MARTIN NOURSE: I also agree.
ORDER: Appeal dismissed with costs to be agreed; any
item of disagreement will be submitted in the first instance to Buxton LJ for
the purpose of consideration of summary assessment.
(Order not part of approved
judgment)
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