Case Number: TUR1/371/(2004)
1 October 2004
CENTRAL ARBITRATION
COMMITTEE
TRADE UNION AND LABOUR RELATIONS
(CONSOLIDATION) ACT 1992
SCHEDULE A1 -
COLLECTIVE BARGAINING: RECOGNITION
DETERMINATION OF THE BARGAINING UNIT
The Parties:
TGWU
and
TVR Engineering Ltd
Introduction
1. The TGWU (the Union) submitted an
application to the CAC dated 24 May 2004 that it should
be recognised for collective bargaining by TVR Engineering Ltd (the Employer). In its application the Union described the
proposed bargaining unit as ‘all employees up to the level of first line
supervision/management and admin staff, service, crash repairs & stores,
main production assembly, trimming & components, welding & fabrication,
laminating, finishing & preparation, paint & primer shop, engineering
assembly, plastic injection, electrics’. The location of the unit was given as a single
site based at Bristol Avenue, Blackpool and the Union stated that the
number of workers in the proposed bargaining unit was approximately 200. The CAC gave both Parties notice of receipt of
the application on 25 May 2004. The Employer submitted its response to the application
on 3 June 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
John Goodman CBE, Deputy Chairman, and as Members, Mr David Bower and Mr Sandy
Boyle. The Case Manager appointed to support
the Panel was Humphrey Uddoh and, later, Nigel Cookson.
3. By a decision dated 12 August 2004, the Panel accepted the Union’s application
and, as no agreement was reached on the bargaining unit, subsequently invited
both Parties 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 22 September 2004 and the names of those who
attended the hearing are appended to this decision.
Clarification of the proposed bargaining unit
4. At the outset of the hearing the Union explained that
it wished to clarify the composition of the proposed bargaining unit following
receipt, from the Employer, of a list of the workers in the proposed bargaining
unit as defined in the Union’s application. The Union accepted that
the terms Engineering Assembly and AJP referred to the same group of workers
and submitted that workers in this category were excluded from the proposed
bargaining unit on the basis that they were monthly paid whereas the remaining
workers in the proposed bargaining unit were weekly paid. It had not been the Union’s intention to
include monthly paid workers in its bargaining unit and it accepted that the
inclusion of the term “Engineering Assembly” in the definition of the
bargaining unit in its application for recognition was based on a
misunderstanding. This arose in
circumstances of limited information being made available to the Union. The Union notified the
Employer of this clarification by letter on 8
September 2004. The Union
confirmed that the bargaining unit it proposed was all weekly paid production
operatives and key workers (weekly paid workers), up to the level of
first line supervision/management and excluding admin staff. The bargaining unit therefore comprised
workers in service, crash repairs & stores, main production assembly,
trimming and components, welding and
fabrication, laminating, finishing and preparation, paint and primer shop,
plastic injection and electrics. The
Employer put forward a proposal that, as the terms used by the Union were not
those used within the company, the Parties be granted a short adjournment to
agree terminology thus avoiding any confusion during the course of the
hearing. The Panel granted a short
adjournment for this purpose. The
Parties were then able to agree that the following descriptors were appropriate
for the various functions within the Union’s proposed
bargaining unit – Laminating and Body Shop, Trim/electric, Injection moulding, Stores,
Paint/Primer, Crash repair/service, Machine shop and Production. The Panel was satisfied that both the above
were clarifications of the Union’s proposed bargaining unit
and the Employer did not take issue with this finding.
Submissions made by the Trade Union
5. The Union explained that the
bargaining unit, as set out in its application dated 24 May 2004 and subsequently clarified,
was a bargaining unit that was compatible with effective management. It was a bargaining unit that covered all weekly
paid workers. It excluded from the
bargaining unit those workers that were monthly paid, namely those engaged in
first line supervision, management, admin and the workers in engineering
assembly. In addition to being salaried,
these workers had other differences in their terms and conditions which set
them apart from those that were weekly paid.
Further, the salaried workers had not demonstrated any interest in
joining the Union or participating in collective bargaining. The Union explained that
there were two categories of workers in its proposed bargaining unit: production
operatives and key workers, both of which were weekly paid. Its bargaining unit covered both categories
of workers. It explained that out of the
30 workers that were classed as key workers, the majority were employed in the
Crash repair/service department with the remainder spread across the other
departments within the proposed bargaining unit.
6. The bargaining unit was based at the one site in Bristol Avenue, Blackpool and was one that
fitted in with the present structure of the company. It would not cause disruption of the company
business or its operation. There was no evidence that effective management
would be compromised by the proposed bargaining unit.
7. The Union considered that the
acknowledged method of dealing with workers in the automotive industry was
through collective bargaining. There was no evidence that collective bargaining
compromised an employer's ability to be efficient, profitable or
innovative. The Union could bring
expertise to the company with consultation obligations under legislation such
as TUPE and redundancy. This had worked
in a satisfactory manner for other employers in the same industry such as Ford,
General Motors, and Rover. The Union also had
considerable experience in small and medium sized enterprises.
8. The Union noted that there were no
national bargaining arrangements with the company or any evidence of a national
bargaining agreement.
9. The proposed bargaining unit would be a unified bargaining
unit consisting of workers with the same or similar terms and conditions of
employment, working on the same site with the same common interests and
bargaining objectives. Excluded from the
proposed bargaining unit would be all monthly paid salaried workers, including
those monthly paid workers within engineering assembly, chargehands,
supervisors, managers and admin staff who were considered to have different
interests and roles from the workers in the proposed bargaining unit. The Union pointed to some
of the differences in the terms and conditions between the weekly paid production
operatives and key workers and the monthly paid salaried workers. Such salaried workers enjoyed 12 weeks sick
pay at full salary whilst weekly paid workers were only entitled to statutory
sick pay. Salaried workers were entitled
to join the company pension scheme whilst weekly paid were not. Salaried workers were allowed the use of
company vehicles for personal use whilst weekly paid workers were not. Weekly paid workers had to clock in and out
each day whilst salaried workers did not.
The Union explained that the Employer had recently conducted a
ballot of the workforce and had separated out salaried workers and weekly paid workers
for the purposes of the ballot. The
workers in engineering assembly/AJP were included in that part of the ballot
reserved for salaried workers. There
was no evidence of any fragmentation that would create difficulty for the Employer
should the Union’s proposed bargaining unit be adopted.
10. The Union submitted that its proposed
bargaining unit satisfied the tests laid out in the legislation. It referred the Panel to the case of R v
Central Arbitration Committee ex parte Kwik-Fit (GB) Ltd [2002] IRLR 395 in which Buxton
LJ said at paragraph 6, inter alia:
"6. .…it seems self-evident that the CAC's
task is to start with the only proposal that it has before it, that contained
in the Union's request……."
and, at
paragraph 7:
"7. ….the
statutory test is set at the comparatively modest level of appropriateness,
rather than of the optimum or best possible outcome………..provided the CAC
concludes that the union's unit is appropriate, its inquiry should stop there."
The Union contended that both
the Court of Appeal and the High Court Judge agreed with the submission of the
union in that case. In its decision the
CAC summarised the union's position where it stated:
"The union
reminded us that "compatible" means "consistent", or
"able to co-exist with". That is, we are not required to decide on
the most effective form of management, merely that we decide what is compatible
with effectiveness. Or to put it another way, we need to examine whether the
union's proposed bargaining unit is found wanting and does not conflict with
effective management."
11. In response to a point made by the
Employer as to why the Union sought to exclude those
workers on the subsidiary assembly line, the Union argued that the “Typhon” was a car in the development stage and that the
majority of the workers involved in the project were monthly paid. The Union refuted the
Employer’s argument that it was not compatible with effective management to
exclude from the bargaining unit those weekly paid workers on development work
and the “Typhon” production line.
12. The Union closed by submitting that it was
concerned about the number of weekly paid workers that appeared on list “A” which
was annexed to the Employer’s written submissions but, nonetheless, it was
content for the bargaining unit to be defined as production operatives and key
workers that were currently weekly paid.
Submissions made by the Employer
13. The Employer submitted that its primary
concern was for a bargaining unit that was compatible with effective
management. It argued that the
bargaining unit as presently defined did not satisfy the requirement to avoid
small fragmented units within an undertaking.
As well as the main production line that the Union included within
its bargaining unit, there was a subsidiary line whose workers fell outside the
proposed bargaining unit. Workers from a
variety of departments would be seconded to work on the subsidiary line. It was the Employer’s case that the workers
on the main and subsidiary production lines shared the same skills and
positions and that by segregating workers in this manner would give rise to a
fragmented bargaining unit. The only
difference between the workers was that they were producing different cars,
with the workers on the subsidiary assembly line currently working on the “Typhon” model. Further,
it was the Employer’s intention that the main and subsidiary lines would shortly
be combined into one single production line.
14. The Employer clarified the common job
titles of the workers explaining that there were production operatives, key
workers, chargehands and foremen. Production operatives and key workers being weekly
paid and chargehands and foremen monthly paid. It was confirmed that no
production operatives nor any key workers were monthly paid. It explained that there was very little
distinction between production operatives and key workers. Originally all weekly paid workers were on
the same basic pay but the previous owner had felt that some workers, including
areas such as service/crash repairs should have enhanced remuneration in line
with the additional responsibility of their role. This resulted in the designation “key worker”
and the term “weekly salaried” which had applied to a small minority of workers. Key workers, although enjoying enhanced pay,
were weekly paid and had no managerial responsibilities. All remaining terms and conditions were the
same as the weekly paid production operatives.
There were currently in the region of 265 weekly paid production
operatives and key workers and 110 monthly paid workers employed by the
company.
15. The Employer submitted that the Union had erred in
describing the differences in terms and conditions between weekly paid workers and
those that were monthly paid. The Union was correct in
stating that there was a difference between the workers in respect of pension
rights but that this was because the weekly paid workers had rejected the offer
of a pension when the company first tabled the proposal some 10 years ago
whilst the monthly paid workers had taken up the option. However, the new owner, who took over the
company at the beginning of August 2004, had informed the workforce that he
would be introducing a pension scheme that encompassed all workers. Further, the new owner was keen that all
remaining terms and conditions be harmonised across the workforce as he was of
the view that all workers should be treated the same. As part of this process he was looking to
replace the current monthly/weekly pay system with a fortnightly pay scheme. All workers would also be entitled to the
same sick pay and paid paternity leave and all would receive a free meal: the
free meal for all workers having already been introduced.
16. Contrary to the Union’s claim, monthly
paid workers were not entitled to 12 weeks sick pay. The reality was that the same scheme now applied
to the entire workforce irrespective of how they were paid, with each worker
being entitled to three weeks sick pay per year subject to the production of a
doctor’s note.
17. Neither, the Employer stated, were monthly
paid workers entitled to a company car.
No worker had the right to a company car for personal mileage and there
were currently only two workers with a contractual right to a company car. Any worker, whether weekly or monthly paid,
that had to travel on company business was entitled to the use of company
car. It explained that in previous years
some workers did have the use of a company vehicle but that all were returned
when the new taxation laws on company cars were introduced.
18. The Employer explained that the reason
the weekly paid workers were required to “clock on” was because it operated two
separate payroll systems. The weekly
payroll system for the production operatives and key workers was based on-site
and so could be linked in with attendance recording equipment. However, the payroll system for the monthly
paid was located in Stoke and could not be connected in the same way. However, once the proposed fortnightly pay
system was introduced all workers would be required to “clock on”.
19. The Employer referred to the two lists of
workers it had attached to its written submissions and which had been copied to
the Union. The list
labelled “A” consisted of 305 workers whom the Employer considered to be
included in the proposed bargaining unit.
(This list included 30 workers in Engineering Assembly that were now
excluded from the proposed bargaining unit following the Union’s agreed clarification
at the start of the hearing.) The second
list, marked “B” consisted of a further 65 workers and 3 directors that the
Employer did not consider to be part of the proposed bargaining unit. The majority of the workers currently working
on the “Typhon” project appeared on list “A”. The project team consisted of both monthly
and weekly paid workers and was headed by a Production Director/Manager. It
confirmed that all of the workers on list “A”, apart from the workers in
Engineering Assembly, were weekly paid.
20. The Employer submitted that the
determined bargaining unit could be defined without any reference to specific
departments. It argued that defining it
as production operatives and key workers would suffice. The Employer was concerned that, as it
planned to harmonise monthly and weekly paid into fortnightly paid, if the
Panel were to use weekly paid in the definition of the bargaining unit then
there would be a possible danger that the case would be back before the CAC
under Part III of the Schedule.
21. In closing the Employer submitted that
the primary consideration was for the bargaining unit to be compatible with
effective management. Whilst there was a
dispute between the Parties as to the definition of the Union’s proposed
bargaining unit the Parties were in agreement as to the job categories and types
of workers that should be in the bargaining unit. There was a need for clarity whatever the
composition of the bargaining unit. The
Employer argued that the bargaining unit should not be defined by department
and that its preference was for it to be defined simply by the terms “production
operatives and key workers”. There was
no evidence that the use of this definition would include any worker that the Union sought to
exclude. The Employer was concerned
about the use of the terms weekly and monthly paid as these terms would become
redundant once the fortnightly pay system was introduced.
Considerations
22. At this stage of the proceedings the
Panel is ordinarily tasked with assessing the submissions of the Parties with
regard to the requirements of paragraphs 19(3)(a) and
(b) of the Schedule. That is to consider
the arguments and to arrive at a decision as to the appropriate bargaining unit
and in making that decision to take into account the need for the unit to be
compatible with effective management and the matters listed in paragraph 19(4)
of the Schedule so far as they do not conflict with that need. Those matters 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 proposed
bargaining unit and of any other employees whom the CAC considers relevant; and
the location of workers.
23. The Panel’s first duty would be to
determine whether the bargaining unit proposed by the Union was a unit that
was compatible with effective management.
However, in this instance, whilst the Employer from the outset argued
that the Union’s proposed bargaining unit was not compatible with effective
management, it closed its submissions with the admission that the Parties were
in agreement as to the job categories and types of workers that should be included
within the bargaining unit, explaining that the only area of dispute between
the Parties was simply the terms in which it should be expressed. This followed the acceptance by both Parties
that weekly paid production operatives and key workers seconded to development
work on the “Typhon” project and line were included
in the proposed bargaining unit.
24. The Employer, setting aside for the
moment the precise terminology, has agreed that the bargaining unit should
comprise those workers that are weekly paid production operatives and key
workers. This is the group of workers in
the bargaining unit as proposed by the Union following its
clarification at the outset of, and during, the hearing although the Union went further and
set out the specific departments that these workers worked within. As the Employer has signalled its agreement to
the clarified proposed bargaining unit the Panel is not called upon to make a
decision in accordance with the matters set out in paragraph 19 of the
Schedule.
25. The only matter for the Panel to
determine is the precise terminology of the agreed bargaining unit. The Employer, in its closing submissions,
argued the need for clarity whatever the definition. It submitted that the bargaining unit should
not be defined by department but simply by the term “production and key
workers” as there was no evidence that any worker outside the Union’s intended
bargaining unit would be included if this term was adopted. The Employer confirmed during the hearing
that there were no monthly paid production and key workers. It explained that it had some concerns about
the use of the term “weekly paid” in defining the bargaining unit, as the new
owner had stated his desire to streamline the existing practice of separate monthly
and weekly pay processes into one fortnightly arrangement for all workers. Accordingly, the designation “weekly paid”
would soon become redundant and, the Employer submitted, possibly give rise to
an application under Part III of the Schedule.
26. The Union, in its closing
submission, agreed that the bargaining unit should be expressed as including production
operatives and key workers but wanted this amplified in some way. It suggested the addition of the phrase “that
were currently weekly paid” to ensure that all monthly paid workers were
excluded.
27. The Panel has considered the arguments
put forward by the Parties as to how the bargaining unit should be
defined. It accepts the Employer’s
assurance that the designation “production operatives and key workers” would
not include any worker that the Union sought to
exclude. It is on the basis of this
assurance that the Panel has arrived at its decision. It also accepts that it is desirable, for the
avoidance of doubt, especially in the short term, to distinguish between posts
which are paid weekly and those paid monthly at the time of the hearing.
Decision
28. The Panel has decided that the appropriate
bargaining unit in this matter is all those jobs/posts including all production
operatives and key workers that are employed at the company’s premises in Bristol Avenue, Blackpool which were paid
weekly at the date of the hearing, 22
September 2004. The Panel is
satisfied that, whilst the definition of the bargaining unit has been amended,
nonetheless, it is the same bargaining unit as proposed by the Union in its
application and as further clarified at the commencement of the hearing.
Panel
Professor John
Goodman
David Bower
Sandy Boyle
1 October 2004
Appendix
Names of those
who attended the hearing:
For the Trade Union
Richie James - Regional Industrial Organiser
John Hall - Full
Time Official
Phil Martin -
Worker
Gary Webster - Worker
For the Employer
Carolyn D’Sousa - of Counsel
David Oxley - Head
of Human Resources
Graham Rawlinson - Worker
Susan Brown - Worker