Case Number: TUR1/344/2004

Case Number: TUR1/344/2004

19 May 2004

CENTRAL ARBITRATION COMMITTEE

TRADE UNION AND LABOUR RELATIONS (CONSOLIDATION) ACT 1992

SCHEDULE A1 - COLLECTIVE BARGAINING: RECOGNITION

DETERMINATION OF THE APPROPRIATE BARGAINING UNIT

The Parties:

GMB

and

Greengate Furniture Limited

Introduction

1. The GMB (the Union) submitted an application to the CAC dated 20 February 2004 that it should be recognised for collective bargaining by Greengate Furniture Limited (the Employer). In its application the Union stated that the proposed bargaining unit is Production Employees at the Coronation Road Site. The CAC gave both parties notice of receipt of the application on 23 February 2004. The Employer submitted a response to the CAC on 26 February 2004 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 Linda Dickens (Deputy Chairman) and as Members, Dr Elizabeth Allen and Mr Robert Hill. The Case Manager appointed to support the Panel was Matt Penfold.

3. By its written decision dated 19 March 2004 the Panel accepted the Union’s application. The Parties were unable to reach an agreement on the appropriate bargaining unit and the Panel convened a hearing, held on 05 May 2004. The parties provided written submissions to the Panel to assist its considerations of the appropriate bargaining unit and these submissions were exchanged in advance of the hearing. The names of those who attended the hearing are appended to this decision.

Summary of the Union's case

4. The Union submitted that its proposed bargaining unit of Production workers at the Coronation Road site is the appropriate bargaining unit. The Coronation Road site is a new factory which is open plan, on one level and in which all the production workers, of whom it stated there are 17, are in sight of each other. Whilst there is another site at Oakridge Road, about which there had been some discussion during the direct negotiation between the parties preceding the hearing, the Union stated that it is pursuing solely the Coronation Road site.

5. The Union stated that despite the absence of formal recognition agreements, it, and before 1994 its predecessor FTAT, has had an historic relationship with the furniture industry in High Wycombe. The statutory recognition procedure and changes within the management and structure of the furniture industry had led the Union to recently embark upon a campaign to formalize these relationships and Greengates is one of the Employers with whom it has attempted to reach a recognition agreement. Basic pay and conditions for workers in the industry traditionally have been covered by industry level negotiations between the GMB and the British Furniture Manufacturers (BFM) employer organization, leading to a National Labour Agreement (NLA). This provides a framework for terms and conditions of work, relating to such areas as pay and holidays, with local adjustment to pay rates permitted. The Union stated that Greengate had recently withdrawn from membership of the BFM but still follows the NLA.

6. The Union argued that the Employer’s proposal to recognize it in respect of only those departments where it has membership currently (sewing, preparation and upholstery) is not compatible with effective management, would cause fragmentation and would be counter productive to good employee relations.

7. The Union confirmed that its membership level was 11 out of the 17 Production workers. It noted that although it does not currently have membership among workers in the cutting, finishing and dispatch areas, it has done in the past and may well do so in the future.

Summary of the Employer’s case

8. The Employer questions the relevance of collective bargaining for a company as small as Greengate but stated that it would negotiate with the union for production workers in departments at Coronation Road where there is 100% membership, namely Sewing, Preparation and Upholstery but wished to exclude three other departments in which production workers are employed, Cutting, Finishing and Despatch, where, it stated, there is no union membership. The Company’s proposed bargaining unit therefore is one comprising production workers in Sewing, Preparation and Upholstery at the Coronation Road site.

9. The Employer stated that in the areas outside its proposed bargaining unit there is no mandate for recognition of the union as these workers are free to join the union but have chosen not to do so. The Employer submitted that, in common with at least some of its workers, it was not comfortable with the apparent premise behind the statutory recognition legislation that majority support rather than actual union membership can give rise to recognition for the purposes of collective bargaining. There was concern among some employees that they might have to join the union when they did not wish to, or have the shop steward speak for them when they would rather speak for themselves. Currently there were monthly meetings involving the union shop steward and another representative of staff, meeting with management.

10. The Employer denied that it had a long standing relationship with the union and its predecessor. Although until recently it had been a member of the BFM and followed the industry agreement, in practice its pay rates had always been in excess of the national minima.

11. The Employer stated that whilst there are no easily identifiable common rates of pay amongst different types of production workers there are ‘ranges’ below which it would be difficult to recruit and retain. Differences in pay rates are individual rather than group related and are arrived at by assessing such factors as flexibility, output and attitude as well as taking account of market factors and the ‘town rate’. Thus workers doing the same job in the same department can be on different rates of pay, depending of the assessment of line managers and their recommendations. There are three line managers covering the six departments. The Employer argued that individual pay determination was more appropriate than ‘blanket agreements’ where there was craft working.

12. The Employer stated that there is a common basic 39 hour week for production workers, with some individual flexibility for domestic reasons, and there are annual close down holiday periods, with some floating days.

13. The Employer agreed that the number of production workers at Coronation Road is 17 (although it was noted that in addition a retired member of staff was still given work under an amicable arrangement). The claimed union membership of 11 was also accepted, as was the statement that there had been union members in cutting and dispatch in the recent past but those staff had now left.

14. The Schedule, at paragraph 19(3), requires the Panel, in deciding the appropriate bargaining unit, to take account of the need for the bargaining unit to be compatible with effective management. In addition, the Panel must take account of the matters in paragraph 19(4) in so far as they do not conflict with effective management. These matters are the views of the employer and of 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 proposed bargaining unit and of any other employees of the employer whom the CAC considers relevant, and the location of the workers. In considering these matters, the Panel has taken careful consideration of all the evidence provided by the parties, both in their written submissions and at the hearing. The Panel has examined the bargaining unit proposed by the Union, and the counter arguments and alternative bargaining unit put forward by the Employer, with these factors in mind.

15. The Parties were agreed that we should consider only Coronation Road, the Oakridge site being run as separate entity. It was agreed there are 23 workers at Coronation Road of whom 17 are production workers.

16. It is clear that the Employer’s principal objection to the bargaining unit proposed by the Union is that it includes workers who are not members of the union. The Panel felt this objection arose partly from personal beliefs and partly from concerns that union recognition would mean an end to individual pay determination and individual representation, and fears on the part of some employees that union recognition would mean they would have to join the union.

17. At the hearing the Chair of the Panel explained that at this stage the Panel was not addressing whether the Union should be recognised but rather what constituted an appropriate bargaining unit. Recognition is a separate issue which will be determined by reference to the group of workers in the bargaining unit once that has been determined. Outside of any voluntary agreement the parties might reach, recognition will only be achieved by the Union where the Panel is satisfied that a majority of the workers in the bargaining unit are members of the applicant trade union, in which circumstances the Panel may declare the union recognised without a secret ballot, or, if a secret ballot is ordered, where the Union secures the necessary majority support under the legislation to win the ballot. Even where there is a majority of Union members in a bargaining unit a ballot may still be ordered by the CAC if it is satisfied that there are good reasons for doing so, in terms of the conditions set out in the legislation. The Chair of the Panel further explained that it was commonly the case that bargaining units include both union members and non members and everyone has the freedom not to join a union, even if it is recognised by the employer for collective bargaining in respect of the category of workers to which they belong.

18. At the hearing the Union indicated that if it were to be recognized at Greengate it would take the NLA standards as a guide and seek to agree better terms locally. It was not seeking to change the existing practice of individually assessed pay adjustments; nor did it intend to coerce anyone into joining the union or into being represented by the shop steward if they did not wish to be.

19. The Employer has proposed that the bargaining unit be drawn around areas of existing 100% union membership. The Panel notes that departments which now include no union members have included them in the past, and may do again in the future. Similarly staff changes may mean that those areas currently with 100% membership may have a reduced proportion in the future. The location of union members is not a robust factor for determining a bargaining unit and, importantly, does not sufficiently address the factors set out in the legislation. There are no other relevant distinctions between the unionized and non unionized departments which would make it sensible in terms of effective management to separate them in a way which would produce a small fragmented bargaining unit, something which we are instructed by the statute to seek to avoid.

20. The Panel, having considered all the evidence and taking account of the written submissions and oral representations at the hearing, is satisfied that the shared location of the production workers, some flexibility across departments; common basic hours and holidays, communication and management arrangements, all go to support the Union view that a bargaining unit of all production workers is a logical constituency and one which is compatible with effective management.