Tuesday, 9 January 2001

Various cases

1. Central Arbitration Committee - Red Letter Bradford Ltd v GPMU
2. Recent EAT Decisions
3. Employment Tribunal decision on disability discrimination justification - O'Neill v HSBC Bank


1. Red Letter Bradford Ltd v GPMU
Central Arbitration Committee, December 2000 (Professor Roy Lewis, chair)

An example of the CAC deciding what amounts to a 'bargaining unit'. Red Letter Bradford was a mail order business employing 67 people. Of these, 58 were shopfloor workers/IT workers, and the remaining 9 were managers and non-shopfloor workers.

The GPMU, which is a media trade union, submitted an application that it should be recognised for the purpose of collective bargaining, with the 58 shopfloor workers/IT workers as the bargaining unit. It did not want to include the remaining 9 in the bargaining unit, because it said the terms and conditions were significantly different.

The employer submitted all 67 employees should be in the bargaining unit, since to include just 58 would result in a fragmented workforce with a small 'rump' of workers without representation, thereby hindering company management.

The CAC found as facts that there were a number of differences between the groups, including the former being paid overtime (with management and non-shopfloor workers not receiving overtime), the former being paid on a hourly rate (the others on a salary), the former having to clock on and off, and wage being linked to a grading system based on skills and experience (unlike the managers and non-shopfloor workers).

Accordingly the CAC held that the shopfloor workers/IT workers were a discrete group and capable of forming an independent bargaining unit. Although the CAC recognised that this made management slightly more difficult, it noted that Red Letter's associated companies adopted a similar system of recognition for shopfloor workers only, and held that a balancing exercise favoured the union's position.


2. Recent EAT Decisions

These cases are unreported (although some may be reported in due course). All transcripts can be found at http://wood.ccta.gov.uk/eat/eatjudgments.nsf.

Lilburne-Byford v Essex County Council [13.11.2000, HHJ Wilson]
A (welcome!) example of the EAT upholding the tribunal's decision to award costs. Authority for the proposition that there is no obligation on a tribunal to investigate the Applicant's means prior to making a costs order.

ValueUnion Limited v White [7.11.2000, HHJ Wilkie QC]
Confirming that, in redundancy cases where it is genuinely unclear whether a fair procedure would have made a difference, the tribunal is entitled to refuse to make any Polkey reduction.


3. O'Neill v HSBC Bank

HSBC bank introduced a pay scheme which awarded an annual bonus to employees based upon three factors: achievement of a job target, personal performance factor and corporate performance factor. This yielded a multiplier which was applied to the annual salary to calculate the bonus.

However, a matrix system was also introduced to discount the bonus depending on the number of days absence for an employee. Employees who were absent for less than 20 days were not penalised. However, employees who were absent for more than 20 days suffered staggered discounts to their bonus. This scheme, which was introduced after extensive consultation with the recognised union, was designed to combat sick absence (which was a significant problem for the bank).

Mr O'Neill complained that this discriminated against disabled persons, since they were more likely to be absent from work. That was accepted by the bank, and the only issue was justification.

The tribunal held, in a thorough and well-reasoned decision, that the bonus scheme was a performance-related pay scheme - and it was not prevented from being so by the use of absence from work as a factor. It therefore fell within regulation 3 of the Disability Discrimination (Employment) Regulations 1996, which indicated that such a scheme was justified, and within paragraph 5.29 of the Code of Practice (also indicating that such a scheme was justified).

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