Court of Appeal upholds trade union recognition for small pool of employees

The Court of Appeal has upheld a Central Arbitration Committee (CAC) decision that a group of warehouse operatives constituting 1.2% of Lidl’s total UK workforce was an appropriate bargaining unit for the purposes of trade union recognition.

The GMB submitted an application to the CAC to be recognised by Lidl for the purposes of collective bargaining for a bargaining unit defined as “Warehouse Operatives working in the following sections: Goods in, Goods Out & Selection employed at Lidl’s Bridgend Regional Distribution Centre”. The CAC accepted the application. This gave the parties a period of time to agree whether the proposed bargaining unit was “appropriate”. They were unable to agree, so the matter fell to be decided by the CAC. The CAC decided that the proposed unit was appropriate. Lidl unsuccessfully issued judicial review proceedings against the CAC’s decision, and then appealed against the High Court’s rejection of the claim.

At the time of the decision, Lidl had 18,203 employees in Great Britain, with nine Regional Distribution Centres. There were about 273 warehouse staff at Bridgend. Lidl did not recognise a trade union for any of its employees in Great Britain.

Under the Trade Union and Labour Relations (Consolidation) Act 1992, an independent trade union can request recognition from an employer. If that cannot be achieved by agreement, the union can seek a decision from the CAC, which in effect requires the employer to recognise it. Recognition for the purposes of collective bargaining (including negotiations relating to pay, hours and holidays) is for a specified group of workers, which is described as the “bargaining unit”. The request for recognition must identify the proposed bargaining unit. If the request is not accepted, the union can apply to the CAC for a decision as to whether the proposed bargaining unit is “appropriate”. When reaching a decision as to whether the proposed bargaining unit is appropriate, the CAC must take into account factors including the need for the unit to be compatible with effective management and the desirability of avoiding small fragmented bargaining units.

The Court of Appeal considered the issue of fragmentation. It noted that it is undesirable for an employer to have to negotiate in more than one forum in respect of parts of their workforce that are not essentially different. However, the provisions in question were intended to avoid fragmentation of collective bargaining – in other words, negotiating with more than one union – rather than prevent a situation where a union is recognised in respect of only a small pool of employees and no union is recognised in respect of the remainder. This was the case at Lidl. The CAC was also entitled to decide that although there was only a very small proportion of staff at the same grade and location in the bargaining unit, this was not incompatible with effective management.

Comment

The fact that trade union recognition procedures allow for a broad interpretation on “appropriateness” reflects Parliament’s intention that the CAC is best-placed to make expert decisions about bargaining units, with which the courts should be reluctant to interfere.

In the event of a request from a union for recognition, employers should consider carefully whether reaching agreement by negotiation on the terms of recognition would be more beneficial than recognition enforced by the CAC under the statutory provisions. Given the strict time limits that apply, it is important for employers not to delay when considering their response to any request.

R. (on the application of Lidl Ltd) v Central Arbitration Committee

30 May 2017

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