Malone & Ors v British Airways Plc [2010] EWHC 302 (QB)

Case No: HQ09X04816
Neutral Citation Number: [2010] EWHC 302 (QB)

Royal Courts of Justice
Strand, London, WC2A 2LL

Date: 19 February 2010

Before :

(Sitting as a Judge of the High Court)

Between :

**(1) ELIZABETH ANNE MALONE; (2) NIGEL ANTONY STOTT; (3) MARCEL DEVEREUX (on their own behalf and as representatives under CPR r19.6) (Claimants)


John Hendy QC and Oliver Segal (instructed by Messrs OH Parsons) for the Claimants
Bruce Carr QC and Andrew Burns (instructed by Messrs Baker & McKenzie) for the Defendant

Hearing dates: 2, 3, 4, 5 and 8 February 2010


I Introduction
**1. The three claimants, Miss Malone and Messrs Stott and Devereux are respectively employed by the defendant, British Airways Plc (“BA”) as cabin crew on aircraft based at and flying out of London Heathrow (“LHR”).  They sue on their own behalf and on behalf of other like employees alleging a breach of their respective contracts of employment.  That breach is constituted so they contend, by the decision of BA as promulgated on the 6th October 2009 to reduce as from the 16th November the cabin crew complements on Heathrow flights.  By way of relief the claimants seek a declaration as to their respective contractual terms; an injunction to restrain the now continuing breach of contract; damages; and costs.  BA denies any breach of contract; BA further denies entitlement to the relief sought.

  1. The matter first came before the Court on the 5th November 2009.  An interim injunction was sought and refused, the Judge (Butterfield J) ordering a speedy trial.  It is that trial that has been before me, with oral and written evidence and extensive submissions based thereon.  Inevitably my judgment was reserved and now follows.
  1. Before proceeding with it, I must voice a concern.  It is common ground that the matters that I am concerned with form part of an ongoing dispute between BA and its Heathrow based cabin crews as represented by their union, Unite.  Further, as I learn from the press, that dispute is the subject of current negotiation with a view to settlement.  At an early stage in the trial I made known my concerns about the place of this judgment: whatever the eventual purport would it not tend to impede rather than promote a settlement and restoration of industrial peace?  I was assured that the parties continued to want a judgment.  I can only hope that my concern proves ill founded.

**II My Approach
**4. Central to this judgment must be a consideration of the evidence bearing upon the terms of the relevant contracts of employment – and that as to the events leading up to the decision of the 6th October 2009.  All such will lead into my own judgment.  That said, it is plain that I should make some preliminary findings, (all or most being uncontroversial) so as to make sense of that which is crucial.  It is to these initial topics that I now turn.

**III Preliminaries
**5. BA has three airline fleets.  Two such operate out of LHR: the Worldwide Fleet and the Eurofleet.  A further fleet operates out of Gatwick, undertaking long haul and short haul flights: the Gatwick fleet.  The cabin crews servicing these fleets come under several heads.  First, there are those based at, and operating out of LHR.  They are respectively licensed for service on one or more aircraft types.  They number some 11,500 employees, all having received rigorous initial training.  Second, there are those based at and operating out of Gatwick.  They are similarly trained and licensed; they number some 2000.  Finally, there are those based abroad: the International Cabin Crew (“ICC”).  They are trained and licensed for service on certain worldwide flights to which they bring language skills and an understanding of cultural norms.  Originally publicly owned, BA was privatised in 1987 and trades as a PLC.

  1. For each aircraft operated by BA a minimum number of cabin crew has been initially fixed by a regulator in the jurisdiction in which it was manufactured.  Thus the minimum numbers for each of the Boeing aircraft will have been fixed in the USA by the Federal Aviation Authority (“FAA”).  In the event, BA sets its own numbers which serve to meet, and usually exceed the stipulated minimum number.  These complements as fixed for BA flights seek to take into account not just the minimum as stipulated but also the level of service that will be on offer, the nature and circumstances of the flight and the requirement to ensure adequate rest for the crew.  It is the fixing of these crew complements and their significance in law that lie at the heart of this litigation and fall to be discussed later in this judgment.
  1. Each cabin crew is an ad hoc body rostered for a particular flight from a pool so as to meet the prescribed complement.  All crew members have undergone rigorous initial training.  They start as “main crew member” with potential subsequent promotion to Purser and then Cabin Service Director (“CSD”).  Whereas there are detailed service routines, the CSD in charge retains some discretion.  Thus on first assembly the crew is briefed by their CSD who will allocate persons to different roles, giving preference to seniority by way of experience.
  1. Within BA the department responsible for administering cabin crews is In Flight Customer Experience (“IFCE”).  As from the 1st January 2009 this department was headed by Mr Bill Francis with one, Ms Sally Munro-Smith as a Senior Manager directly answerable to him.  It is material that for many years until retirement at the end of 2008 the person within the department concerned with industrial relations was Mr Alun Howells.
  1. Turning from management to employees, approximately 96% of cabin crew are members of the union Unite.  There is, however, a material history.  Originally union representation was by way of the British Airways Stewards and Stewardesses Association (“BASSA”), a branch of the Transport and General Workers Union.  In 1989 some members broke away and formed an alternative union, Cabin Crew 89.  This in due course became a branch of Amicus.  At a subsequent stage – and prior to the events material to this litigation – the TGWU and Amicus amalgamated to form Unite.  Ostensibly, therefore, representation is by this single union.  However – again at all material times – the old allegiances have held sway, engendering from time to time, mutual rivalry, hostility and mistrust as, alas, will become apparent.
  1. This then leads to the current claimants.  The three named persons are members of Unite and contend that they sue on their own behalf and on behalf of another 5,428 named persons said to be similarly positioned.  For their part, BA have examined the list and contend that it falls to be discounted to 5,337: 62 are not based at LHR and 32 are no longer employed by BA.  All this leaves approximately 6,100 cabin crew based at LHR who are not claimants by way of this litigation.
  1. The remaining “preliminary” topic inevitably dominates the events leading up to this litigation – and remains material as and when injunctive relief is in question: BA’s financial situation.  Happily for the conduct of this trial, the evidence of Ms Sarah Mussenden, BA’s Financial Controller within IFCE, was not in dispute and all that is material falls to be culled from her three witness statements.  Given the lack of dispute there is no need for me to condescend to detail – the broad outline will suffice.  That said, its importance is such that a separate section is now dedicated to it.

**IV The Financial Position of BA
**12. From Ms Mussenden’s statement the following emerges as crucial for present purposes, proceeding by way of financial years.

2007/2008 BA achieved an exceptional total operating profit of £878m and a dividend was paid to shareholders for the first time since 2001.

2008/2009 BA had another exceptional result: this time a total operating loss of £720m.  The factors contributing to this state of affairs included a massive rise in the price of fuel and a collapse in passenger revenue reflecting the general economic downturn – the collapse being particularly relevant to a BA specialty, “premium traffic” utilising First or Business Class.  It is to be noted that for BA this “premium traffic” had accounted for approximately 47% of total revenue, as compared with an industry average of 27%.

2009/2010 The financial year started on the basis of an overall financial plan that postulated financial viability if there were cost savings of £220m, which savings had substantially to be made from those costs which could be subject to control by management, such as employee costs.  In the event the situation worsened.  In the first quarter BA made an operating loss of £94m – the first “first quarter” loss in its history, given that the period March-June is normally highly profitable.  In June 2009 a revised financial plan was prepared focusing on further radical cost reductions.  I can curtail recital of the intervening progress by turning forthwith to that which became available in the course of the trial: the material content of the Interim Management Statement as presented on the 5th February 2010 to the Stock Exchange.  From such as analysed by Ms Mussenden, it is apparent that the bad news continues: an operating loss for the first nine months of £86m (compared with a 2008/2009 operating profit of £89m) and analysts’ predictions of an annual overall loss exceeding £600m.  That said:

“between 1st October 2009 and 31st December 2009” (the third quarter of BA’s financial year or “Q3”) BA made a small operating profit of £25m.  This is the first time that BA has shown a quarterly operating profit for 15 months. Non operating costs such as pension interest expense and financial costs means that overall the company remained loss making in Q3. The Q3 operating profit results highlight the beneficial impact of permanent changes across the company which have focussed on reducing our cost base.  Revenue remains weak; it is down by around 11% or £254m when compared with Q3 of last financial year.  However total operating costs savings of approximately 14%, more than offset this revenue deterioration.  Employee cost savings, including around £18m of savings from cabin crew during the quarter, were a significant contributor to the improved performance of the business.”

  1. Ms Mussenden provides further figures with presently material significance by way of average hourly operating costs:

BA LHR Worldwide: £60
Eurofleet: £58

By way of comparison:

Emirates: £27
Virgin: £20-27
BA Gatwick: £37

BMI: £33
Easy Jet: £20
BA Gatwick: £37

  1. Two points of comment on the foregoing.  The Claimants would fairly contend that the ‘product’ that they offer passengers particularly on longhaul flights and at premium level is labour intensive and dependent on high quality staff – hence at least some discrepancy.  Second, that the BA Gatwick figures reflect lower crew complements and an availability of crew members based there for rostering on both longhaul and shorthaul flights.

**V The Employment Contracts
**15. An initial word of explanation.  Over the years the terms of cabin crew employment contracts have varied.  To ensure that this judgment deals comprehensively with the respective cases as to construction, the parties have put before me nine contracts, the first such dated 1969 and the last such dated 2005, as providing an agreed range.  Amongst the nine are two relating to named Claimants – that engaging Mr Stott is no longer available, but nothing turns on this.

  1. Thus, focussing on the present material:

26th February 1969 Mr R.  McCallum and British European Airways.

Condition C, “You will observe and abide by the Constitution and Rules of Procedure of the National Joint Council for Civil Air Transport (hereinafter referred to as ‘NJC’) and by the agreements between BEA and Trades Union represented in the NJC in so far as the terms apply to you…The agreements covering your normal hours of work, holiday entitlement, sickness benefit and your employment generally are referred to in Section G and are also attached hereto.”

G.“NJC agreements applicable to this employment… Agreements of the National Sectional Panel for Cabin Crew”.

8th April 1969 Mr Alan Land and British Overseas Airways Corporation.  Condition 4 “Your employment will be governed by the following agreement: the Air Stewards and Stewardesses which was concluded in the (NJC)…”

12th March 1976 Miss Elizabeth Malone and British Airways Board

Condition B1, “Your employment…will be governed by…the agreements between (BA) and the Employees’ side of the NJC so far as the same are applicable to your particular appointment.  The NJC agreements from time to time in force are deemed incorporated into this contract and you are referred to these agreements for details of your hours of work, periods of notice, paid holiday entitlements, sickness benefits and general matters”.

C.  Relevant documents include “Agreements of the National Sectional Panel for Air Cabin Crew”.

24th June 1985 Miss Gitta Randhawa and BA.  Her terms are as for Miss Malone.

14th September 1988 Mr Marcel Devereux and BA.  His terms are as for Miss Malone.

13th March 1990 Mr Michael Deehan and BA.  His terms are as for Miss Malone.

3rd March 1992 Mrs Heather Facchinello and BA.  She joined as new entrant Support Cabin Crew, that is, as a casual worker called in when needed.  The agreement is of course specific to this category of employment but includes:

Condition 1 “The NJC Agreements from time to time in force are incorporated into and shall form part of this contract except where they are inconsistent with the express terms of this contract when such express terms shall prevail”.

Special Condition (g) “The Scheduling Agreements for Support Cabin Crew from time to time in force are deemed to be incorporated into, and form part of this contract… (BA) shall in its absolute discretion determine the aircraft types and routes to be worked by you as a member of Support Cabin Crew in accordance with its operational requirements”.

23rd June 1997 Miss Tanya Cumming and BA.

Condition 7 “You are referred to the Air Cabin Crew National Sectional Panel Agreement and the Scheduling Agreement for full details of terms and conditions relating to your hours of work, entitlement to holidays and holiday pay, absence due to sickness and sick pay.  These Agreements, together with the collected agreements between the Company and the Trade Unions…and the Employment Guide contain the terms and conditions of employment as far as applicable to you and as amended from time to time.  The Collected Agreements and the Employment Guide are incorporated, where appropriate, into your contract of employment, save as varied by this document.”

Condition 18 “The Company reserves the right to make reasonable changes to any of your terms of employment from time to time.  Such changes may be made by way of a general notice applicable to all employees or by way of specific notice to you.”

19th May 2005 Mr John Gilfillan and BA.

Condition 3 “The Air Cabin Crew National Sectional Panel Agreement…and the Scheduling Agreement from time to time in force for your fleet are the collective agreements that apply to you.  The Collective Agreements, together with any other or subsequent collective agreements between the company and its recognised Trade Unions that cover your occupational group (or NSP) from time to time in force, form part of your contract of employment.  The Trade Unions may agree changes in your terms and conditions on your behalf…  The contractual policies in the Employment Guide also form part of your contract of employment..”

Condition 31: as Condition 18 above.

**VI The Collective Agreements 
**17. Those collective agreements currently operative are the following:

February 2004 Eurofleet Cabin Crew Manual (“ECCM”).  This covers divers topics under 25 headings over 42 pages.  It opens “This manual has been produced jointly by Inflight Services Scheduling, Crew Control and your Eurofleet Trade Union representatives and as such all areas will uphold the agreement”.  It continues:

“The Agreements incorporated into this manual are for the benefit of everyone in the Eurofleet community.  Please adhere to the arrangements at all times.  If there is ever a requirement to operate outside of them this will have been specifically agreed following consultation between management and your Trades Unions.  To knowingly break the agreement is viewed seriously and appropriate action will be taken”.

The subsequent content is varied, seemingly comprehensive and often detailed.  That said what is stipulated as to Crew Complement is:

“There is a requirement for extra cabin crew to be added to the Crew Complement when European product is served depending on numbers of passengers in Club Europe.  The crew complement matrix is available from Answers.  For minimum numbers on each aircraft type please refer to Flying Crew Orders”.

I interpose: ‘Answers’ is a BA office.  ‘Minimum numbers’ seemingly refers to the certified legal minimum.  Before me there was put in evidence as to that which, as from July 2004, Answers could have supplied: regularly updated, detailed cabin crew complements.

  1. November 2005 Worldwide Scheduling Agreement (“WSA”).  An introduction countersigned by representatives of BA, BASSA and CC89 opens “This section has been revised jointly by Inflight Services and your Worldwide Trade Union representatives”.  The following paragraph contends in somewhat obscure terms that the content is authoritative.  As with ECCM there are numerous topics comprehensively covered.  Crucial to present purposes is “Section 7 Crew Complements”.  The section starts “Minimum Planned Crew Complements”: “all services will be planned to the current industrially agreed complements for each aircraft type.  Future crew complements will continue to take into account in-flight product and cabin crew rest requirements”.  There follow specific provisions as to complements, thus by way of example providing for a complement of 15 on a 747 flight and a complement of eight on a night time two class 767 flight.  All such figures are higher than that which the section identifies as “legal minimum crew complements”, viz those certified by the FAA.  The Section further deals in detail with the carriage of additional cabin crew on certain routes and (in even more detail) with the complement of ICC personnel on 747 and 777 flights.  The significance of these provisions is, say the Claimants, underlined by other associated provisions, one such being 7.4.

“7.4 Downroute Shortage
Occasionally, unplanned situations will occur downroute when it is not possible to provide the correct crewing level. If this happens, in-flight service may be adjusted by the in-charge crew member to cope with the reduced crew complement.  The level of service you are able to provide will depend on passenger numbers, time available and rest requirements.  A guide to product delivery standards is given later in this manual.

Prior to finding a downroute service having to go crew short, British Airways must make every effort to find another crew member.

Options include:

a) Where an ICC base exists, utilising ICC crew from standby or availability.
b) Disrupting the itinerary of another crew member following minimum rest.
c) Positioning out of a replacement crew member.”

  1. November 2005 Disruption Agreement provides a detailed protocol for dealing with disruptions to BA’s operations such as threaten to impact upon the provisions of ECCM and WSA.  For present purposes I need only cite the introduction:

“When significant events outside the control of British Airways cause severe disruption to the operation, the following changes to the scheduling agreement may, after agreement with the Trades Union has been reached, be enacted for an agreed fixed period of time, to maintain the integrity of the operation and facilitate the return of the operation to normal as soon as possible.

The IFS Operations Manger will contact the chairpersons of each of the Trades Unions to inform them of the situation and recommend a timescale for which the disruption agreement will be required.  With the agreements from the aforementioned confirmed, the details of options to be used will be verified in writing.
The IFS Operations Manager will log the occasions that the agreement is utilised and will fully debrief the Trades Union at the following week’s Operations meeting.  Details will also be recorded in the Worldwide Steering Minutes.

During the specified period of disruption, the report centres at LHR and LGW will display signage to the cabin crew informing them that the Operation is in a period of disruption.

Examples of occasions where this agreement could be enacted are severe weather, acts of terrorism, ATC failure or the collapse of power/communications supply.  This list of examples is not exhaustive and other events that are outside of British Airways control will need to be considered.”

  1. Before concluding this part of the judgment, I can usefully add the following:

(a) The so-called legal minimum crewing complements are markedly lower than those set out in WSA.  Thus, for example, a crew complement of 15 for a 747 compares with a minimum requirement of 12; complements of 11-13 for a 777 compare with the minimum of eight.
(b) S.179 Trade Union and Labour Relations (Consolidation) Act 1992 precludes legal enforcement of these collective agreements, absent a specific provision (not contended for) stating a joint intent that there be legal enforceability.
(c) I was provided with the October 2006 Gatwick Fleet Memorandum of Agreements as a point of reference and comparison. As to Crew Complements it specifies simply “Crew Complements will be determined via The Gatwick Fleet IFC and will be widely published”.

**VII The Chronology - 2009
**21.The essential chronology is as follows;

i) 24th February – At a National Sectional Panel (“NSP”) meeting Mr Francis told the Union that in the then financial circumstances BA looked to save £82m as against the cost of cabin crew.  Throughout Unite had separately identified representatives from both its BASSA and Amicus factions.

ii) 26th February – At a further such meeting Mr Francis handed over a list setting out 32 prospective costs saving measures and invited discussion.  Of these measures nine involved reduction in current cabin crew complements.

iii) February – April   BA met 14 times with BASSA and four times with Amicus in a mixture of formal and informal meetings.

iv) May – Following release of the figures for the first quarter (see para 12 above) the required costs saving was increased to £140m.

v) 1st June – BA issue a statutory HR1 form proposing up to 2000 redundancies amongst cabin crew.  BA and the Union meet at a formal NSP.

vi) 9th – 30th June – Intermittent talks at Heathrow Renaissance Hotel.  In the course of such;

a) 15th June BASSA had a heated argument with Amicus and refused to cooperate together

b) 23rd June BA put forward a proposal in writing.  This included specific reductions in crew complements

c) 25th June – Unite put forward a written Pay and Productivity Proposal, claiming that it would save BA £173m.  It proposed some alterations in the cabin crew complements but no significant reduction.  Thereafter BA tried to understand and analyse the cost saving as anticipated by Unite, bringing in accountants, Price Waterhouse Cooper.  The latter’s assessment was that the saving would be about £53m.  Unite refused to have further discussions over this issue, whether with BA or the accountants.

In the overall result, the meetings broke up without reaching any joint conclusion.

vii) 29th June – Mr Francis sent a letter to each cabin crew member, setting out BA’s proposals, such including a reduction in cabin crew complements.

viii) 21st-23rd July – An abortive session at ACAS.

ix) 21st, 30th September and 1st and 2nd October – Following an agreement reached between BA’s CEO and the Joint General Secretaries of Unite, there was a further sustained resort to ACAS for conciliation.  I heard evidence as to the course of events at ACAS and the following emerged.  The BASSA and Amicus factions were separately represented and sat in separate rooms.  Despite the efforts of ACAS they could not be persuaded to join forces for a meeting with BA.  The latter raised the possibility of separate agreements with the respective factions but, understandably, that did not appeal.  In the overall result there was no meeting between the Union and BA.

x) 6th October – Mr Francis e-mails all cabin crew.  The e-mail is long and detailed – currently, a summary will suffice.  It opens with an expression of intention to achieve the cost saving of £140m sought from his department.  It asserts that, notwithstanding consultation with Unite, no agreement as to measures has been forthcoming : “… after nine months of talks the time has come to move forward”.  There then comes the crucial passage:

“How we will make our savings while minimising the impact on you, our current crew.

We can make these savings and minimise the impact on you, by changing our crew complements.  From 16th November 2009 we will make the following changes while still ensuring that our crewing levels can deliver our premium customer service.

Worldwide – effective from 16th November;

Eurofleet – effective from 1st December

Gatwick – effective from 1st December

xi)16th November and 1st December – These changes duly came into force.

  1. In the event, these changes in cabin crew complement aroused widespread resentment and complaint.  On the evidence, there were two prominent grounds.  First, there was the ‘across the board’ reduction of LHR Worldwide complements by one member.  As to the resultant impact, I heard evidence.  Whilst the impact inevitably varied from flight to flight, particularly as prompted by the number of passengers and their distribution between classes, overall there was now a requirement for harder work and increased stress.  Further, a consistent point made was to the effect that in the event of something occurring on a flight that required the undivided attention of one or more crew members, the remaining members could not do all that was appropriate to maintain BA service standards.  I draw particular attention to this later concept: witnesses were proud to be involved in delivering the BA ‘product’; it was that which distinguished the airline from competitors; it was the enhanced difficulty in delivering it that engendered exhaustion, stress and frustration.  The other prominent ground, as identified by Ms Munro-Smith was the perceived imposition of a revised complement absent negotiation with, and agreement from the Union – a source of resentment compounded by what was promulgated amongst members by the Union which glossed over the ACAS fiasco.  It is to be noted that a similar situation had arisen after ‘9.11’: passenger numbers fell sharply and BA forced through a crew complement reduction but it did then secure the reluctant agreement of the Unions.  No doubt individual members wondered why there was the current absence of such agreement.  I should add: I have focussed on the reduction of LHR Worldwide complements by one – the ‘additional member’ provision is not controversial (it was a Union proposal) and the Eurofleet and Gatwick changes impact less, albeit that lack of Union agreement is there a like cause of resentment.

**VIII The First Claimant
**23. It is convenient and instructive to identify and discuss the issues by reference to the claim herein of Miss Malone, a CSD on LHR Worldwide flights.  Her claim proceeds in the following stages:

i) By way of my contract of employment as already cited collective agreements made from time to time between BA and the Unions “are deemed incorporated”.  It is by reference to these agreements that I can discern various contractual terms, specifically “hours of work, periods of notice, paid holiday entitlements, sickness benefit and general matters.”

ii) One such collective agreement is the WSA of November 2005.  I refer to it for details of a contractual term arguably coming under that heading ‘general matters’, namely the minimum planned crew complement for any flight for which I am rostered.  Thus, if for example, I am rostered for a long range 3 class 777 not only do I expect to have 12 fellow crew members I am legally entitled to such: these collectively agreed complements are incorporated into my contract of employment.  Thus whereas the terms as to these complements are not legally binding as between the parties to the collective agreement (see s.179), they are binding as between BA and myself.

iii) Given that when I now fly the complement is less by one member, BA is to that extent in breach of contract – a state of affairs that will continue until the collectively agreed complement is restored or the reduction is satisfied by a further collective agreement.

iv) Given this breach of contract, I seek an injunction restraining BA from continuing to roster worldwide flights other than in accordance with collectively agreed crew complements – in effect a mandatory order to increase such by one and thereby comply with my contract.

v) Further, with respect to the period pending restoration of collectively agreed complements, I seek damages as for breach of contract, such damages reflecting compensation for each understaffed flight undertaken.

  1. As to the law bearing upon this claim, both sides understandably cite the helpful summary provided by Hobhouse J (as he then was) in Alexander v Standard Telephones (1991) IRLR 286 at 292:

“The principles to be applied can therefore be summarised.  The relevant contract is that between the individual employee and his employer; it is the contractual intention of those two parties which must be ascertained.  In so far as that intention is to be found in a written document, that document must be construed on ordinary contractual principles.  In so far as there is no such document or that document is not complete or conclusive, their contractual intention has to be ascertained by inference from the other available material including collective agreements.  The fact that another document is not itself contractual does not prevent it from being incorporated into the contract if that intention is shown as between the employer and the individual employee.  Where a document is expressly incorporated by general words it is still necessary to consider, in conjunction with the words of incorporation, whether any particular part of that document is apt to be a term of the contract; if it is inapt, the correct construction of the contract may be that it is not a term of the contract.  Where it is not a case of express incorporation, but a matter of inferring the contractual intent, the character of the document and the relevant part of it and whether it is apt to form part of the individual contract is central to the decision whether or not the inference should be drawn.”

  1. By way of further gloss, the parties cite the dicta of Sir Thomas Bingham MR (as he then was) in Adams and Others v British Airways Plc (1996) IRLR 5/4 to the effect that whereas the starting point for contractual construction is the language used by the parties, that language has to be construed “in its factual setting”.  Again they cite Auld LJ in Keeley v Fosroc International Ltd (2006) IRLR 961: “Highly relevant in any consideration, contextual or otherwise, of an ‘incorporate’ provision in an employment contract is the importance of the provision to the over-all bargain, here, the employee’s remuneration package – what he undertook to work for..” and “a good way of testing… is to ask whether, and subject to the issue of certainty, if the (relevant terms) had been set out in identical terms in (the employee’s) statement of employment terms, it could seriously have been argued as a matter of construction that it was not apt for a contractual term and, on that account not part of the contract”.
  1. As guided by the foregoing, it is argued on behalf of the claimants that crew complements bear upon workload and productivity, in turn impacting upon pay and matters germane to the individual’s contract of employment.
  1. For their part BA strongly refutes the foregoing, in summary:

i) There was nothing in Miss Malone’s contract of employment that invited incorporation of the WSA’s crew complement matrices;

ii) There was nothing in the relevant part of the WSA to suggest objectively an intention to create a term potentially binding as part of individual employment contracts:

iii) Incorporation of the relevant part of the WSA into Miss Malone’s contract was patently ‘inapt’;

iv) The alleged entitlement to injunctive relief is obviously unsustainable – indeed consideration of the claim for such and for damages serves to underline how ‘inapt’ incorporation would be.

  1. If relevant to the issue, the emphatic evidence  of Mr Alun Howells was to the effect that he never considered that BA were entering into any potentially legally binding agreement with respect to crew complements when he was a member of BA’s negotiating team.  In the interest of good and effective industrial relations the management did seek and obtain Union ‘agreement’ but this was in honour only (again, see s.179) and pragmatic.

**IX The First Claimant - Judgment
**29. As to the initial and crucial issue, that is, as to whether so much of WSA as prescribed ‘minimum planned crew complements’ was incorporated into Miss Malone’s contract of employment so as to become binding upon BA, I have taken into account the following matters.  None such are conclusive and they vary as to weight.  That said, I regard such as acting overall to enable a judgment to be made:

(a) At no stage did the parties to the WSA express an intention that Section 7 and the provisions satellite to such should be legally binding, either as between themselves (with the power to make such provision expressly retained by s.179), or as incorporated in the respective employment contracts.  True, it would have been surprising if there had been any such provision: the Unions were no doubt pushing for the highest possible crew complements and, I infer, any mention of legal enforceability would not have helped their cause.  That said, when the parties could have expressed an intention to make Section 7 legally binding they omitted to do so.

(b) The parties to WSA were conscious of the fact of material legally enforceable provisions.  Page 11 refers to such in the context of the Air Navigation Order 1989 and, more pertinently, ‘legal minimum crew complements’ are specifically referred to in Section 7 as being distinct from that which is provided for.

(c) Miss Malone’s contract does not readily point to Section 7 of the WSA as being “applicable to your particular appointment”.  If covered, such must come under the ‘catch-all’ head, ‘general matters’ which hardly seems convincing.

(d) Applying the test suggested by Auld LJ Section 7 and the satellite Disruption Agreement could not have been sensibly set out in Miss Malone’s contract.  True, had there been the mutual intent a different clause could have been expressly included, along the lines “when you fly Worldwide as a member of cabin crew the total complement of the crew will be as may be from time agreed collectively between BA and your Union and in any event it will not be less than that certified for the aircraft by the Federal Aviation Authority.”  However, no such clause is contended for and it is not for me to draft the contract.  That said, this exercise of drafting underlines the unreality of a contention that the contract incorporates the relevant WSA provisions so as to render such legally enforceable.

(e) Whereas there is a long established common law obligation on an employer to institute and maintain a safe system of work, under which head there may well arise a need to provide an employee with sufficient assistance from fellow employees so as to obviate reasonably foreseeable risk of injury, the notion of an obligation based on a complement essentially devised in excess of the minimum so as to deliver an enhanced product is novel. 
(f) Finally, a minor point: is ‘all services will be planned’ (see Section 7) aspirational rather than contractual?

  1. Taken overall, first, I am not satisfied that there is sufficient objective to evidence of mutual intention to give to Section 7 and the satellite provisions, legal enforceability at the behest of any individual crew member.  There was the opportunity to align the agreed provisions with that which was “legal” – it was not taken.  Second, as in any event I do not regard Section 7 and its satellite provisions as “apt” for incorporation into Miss Malone’s contract.  What I am reading is what it is: a negotiated fleet collective agreement apt to cover planning for and deployment of 11,500 employees; it is not the stuff of 11,500 individual contracts.  It is thus my judgment that there was no material incorporation into Miss Malone’s contract and hence there was no breach post 16 November 2009.
  1. If I am wrong, I have to consider the remedies as claimed.  Here the position is less debatable.  I am quite satisfied that the granting of an injunction as is sought could not possibly be justified as an exercise of the Court’s discretion.  There are various objections.  The first such is that what is sought is in effect a mandatory injunction, that is, an order requiring BA to restore the erstwhile cabin crew complements.  Per Chitty 30th Edition, General Principles, para.  27-060:

“If (the Defendant) has already broken his contract… he may be ordered by mandatory injunction actually to undo the breach.  Such an order is subject to a ‘balance of convenience’ test and may accordingly be refused if the prejudice suffered by the defendant in having to restore the original position heavily outweighs the advantage that will be derived from such restoration by the claimant.”

Several authorities are cited, principally Sharp v Harrison (1922) 1 Ch 502.  Here the disparity in terms of convenience is quite overwhelming.  The effectively unchallenged evidence of Ms Mussenden and Ms Karen Slinger (the person in charge of cabin crew resource planning) identified a quite exceptional burden faced by BA in terms of cost, planning and reorganisation in the event of a permanent injunction, sufficient indeed to jeopardise prospects of financial recovery.  I turn to this Claimant.  I give weight to all that she opined in her statement of the 2nd November 2007.  Without belittling any of it (albeit noting that this was before the actual change) it does not begin to offer anything significantly impacting on the balance of convenience.

  1. Again, the post 16 November changes have been operative now for nearly three months.  Granted that it is conceded that this state of affairs does not give rise to any contractual point to be taken by BA, it does mitigate strongly against present use of the Court’s discretionary powers to restore the status anté quo.  Yet further, from the Court’s point of view, the discursive, non contractual drafting of the WSA coupled with the participation at various junctures of union representatives make for a difficult drafting and policing exercise.
  1. As to damages, if there is a breach of her contract of employment she is entitled to nominal damages.  There could be an entitlement to an assessed award but she offers no evidence to support such.  Incidentally, if a damages claim has any validity there is another reason for not granting an injunction, see Chitty, op. cit., para.  27-063.

**34. Mr Stott’s contract of employment is not now available.  However, given that he entered employment with BA on the 14th March 1988, it can reasonably be inferred that his contract was as that of the Third Claimant, Mr Devereux, who joined on the 19th September 1988.  Turning to the contract of the latter (as already cited in this judgment, para.  16), it will be seen that there is no material difference between its terms and those of the First Claimant’s contract.  In such circumstances, I really cannot add to or vary my judgment bearing upon the claim of the First Claimant.  As to damages, for health reasons, Mr Stott has not participated in a flight subjected to the new regime and thus is not presently able to substantiate a claim for damages exceeding the nominal.

**35. Further considerations do arise in the case of Mr Devereux, inasmuch as he works out of Heathrow with Eurofleet and he has had experience of working with the reduced crew complement.  Dealing first with the terms of his contract, there is no dispute but that the ECCM was amongst the material governing the terms “so far as the same are applicable to your appointment.”  That said, as already noted, there were no terms within the Manual as to crew complement – as to the legal minimum the reader was referred to Flying Crew Orders; as to the crew complement matrix the reader was referred to ‘Answers’.  As to what the latter might have volunteered if approached in February 2004, that is, as at the date of the Manual, is not apparent but the crew complement matrices as apparently agreed between BA and the Unions in and since July 2004 are before me.  As to this, the first point taken by BA is that the matrices were not agreed by way of a National Sectional Panel so as to come within the material referred to in the contract of employment, but through an ‘Inflight Consultative’, that would be outwith the contract.  This first point I reject – whether technically correct it is conspicuously without merit.  More to the point is the concern as to whether these matrices were sufficiently proximate and certain so as potentially to impact upon Mr Devereux’s contract, via Answers and the ECCM.  Having carefully perused the content, such express terms as there are and the route back to the employment contract, I am unable to hold that they could or did become incorporated into the latter.  There is nothing more persuasive than that which I have already considered with respect to WSA and the First Claimant and indeed this claimant’s case is less convincing as to contractual construction.

  1. It necessarily follows that Mr Devereux’s claim fails.  That said, if I am wrong the questions arise as to injunction and damages. I have nothing further to add to my earlier ruling as to the availability of an injunction but as to damages, I note that by trial he had taken part in 13 flights post 1st December and could have experiences calling for damages.  That said, the whole issue of quantum is difficult and I think that I can fairly deal with the point by indicating that if the quantum of damages becomes an issue (that is, if I am reversed on appeal) I will hold a further hearing to deal with it.
  1. There remain for my consideration the respective contracts of employment not so far discussed. As to such I can without disrespect focus on one only, that of Miss Tanya Cumming of June 1997. Thus, whereas I can find nothing in any of the other contracts that would prompt a conclusion as to construction different from that already expressed in relation to the three lead Claimants (and indeed nothing in Miss Cumming’s contract) it is with respect to contracts made post 1994 that a further point arises, now relied upon by BA: the potential of the then newly introduced clause: “the Company reserves the right to make reasonable changes to any of your terms of employment from time to time.  Such changes may be made by way of a General Notice applicable to all employees or by way of Specific Notice to you.”  Submits BA, if contrary to our contentions the WSA cabin crew complement provisions were incorporated into your (that is, Miss Cumming’s) contract then in reliance upon this reserved right we made reasonable changes to it by way of the communication of the 6th October 2009.
  1. Various points arise for discussion.  First, is such a clause capable of being sustained?  The answer is a qualified “yes” with as references Chitty, 30th Edition, paragraph 22-039 and a Court of Appeal decision, Wandsworth v D’Silva (1998) IRLR 193 at 197.  It is apparent that the clause must be clear in its terms and aim to produce a reasonable result if invoked.  At this point, I readily accept the submission of Mr Hendy QC that the clause falls to be construed contra proferentem: thus, taking all the circumstances into account did Miss Cumming’s agreement to the original contract now embrace the imposed changes?  Were those changes objectively reasonable in that context?  There is divergence between the parties as to the circumstances appropriate for founding the objective assessment.  In my judgment the key lies in that which I am predicating as incorporated in Miss Cumming’s contract viz, first, that cabin crew complements are as from time collectively agreed and, second, they are as appears in WSA and as can be traced through ECCM.  By way of changes BA varied both limbs: the future crew complements were now as unilaterally directed by BA and in the event they were as set out on the 6th October.  Were those changes objectively reasonable?
  1. As to the first limb, Mr Hendy QC is concerned lest I make impermissible and, he would say, immaterial findings.  I acknowledge the warning and it suffices to record that I have taken into account, first, the dire financial situation of BA as at the 6th October.  As to this, I see nothing material in how that situation came to arise, the now undisputed fact is that BA was then in a very serious financial state, such that management reasonably had urgently to do something (and had to be seen to do something) in the interests of the Company, its employees and its financial backers.  I have further taken into account the now undisputed fact that as at the 6th October negotiations with the Union had come to a halt, notwithstanding the efforts of ACAS, and were unlikely to restart unless and until the internal factions of Unite had resolved their differences so as to form a negotiating team.  It is thus, that I find that it was objectively reasonable in the prevailing circumstances to act unilaterally and to make the first change to Miss Cumming’s predicated contract, that is, to impose a cabin crew complement other than by way of a collective agreement.  Let me test this finding: had BA sought to do the same thing in earlier years when there was no serious financial imperative and Miss Cumming’s interests were the subject of effective representation, then my first limb consideration would have been against BA.    I add: I was told the former factions were now as one so that negotiations have restarted and are proceeding.
  1. I turn to the second limb: the changes themselves.  I have already accepted evidence that they can on occasion make it difficult to deliver the “product” thereby inducing stress and strain; similarly I accept that in the event of an untoward event in the course of a flight the cabin crew can become significantly shorthanded.  All that said, I cannot regard the 6th October changes as drastic or extreme and outwith the parameters of “reasonable”.  The crew complements remain significantly above the FAA minimum, the flights demonstrably can continue and to the extent that there is an aligning of LGW and LHR levels it is difficult to raise substantial objections.  But, more importantly all such has to be judged not in a vacuum but in the light of the financial situation: if the new complements materially and fairly contribute to the preservation of BA and more importantly for present purposes job security and pay, how can I condemn the less than extreme changes as unreasonable?
  1. If the point had arisen, then I would have held BA entitled as of the 6th October to invoke the “reasonable changes” clause.

**XII Generally
**42. In the overall result the claim must fail.  I look forward to making a hopefully agreed Order.  I reiterate my concern that this judgment will at the least not hinder the early resolution of cabin crew issues by way of the type of negotiation that has been such a feature of BA’s industrial relations over the years.  One outstanding feature of the evidence has been the pride associated with employment by BA and with delivery of its “product” and the desire for circumstances that permit sustained high standards.  The continuing and presently prospective problem is money, finding the wherewithal to fund an airline of this nature and one would imagine that the only real prospect for alleviation of the impact upon cabin crew is by negotiation that truly reflects and balances the demands upon, and the commitment of the employee with the unavoidable realities of the current pressures upon management.

  1. I must conclude by paying tribute to the professional standards of the legal teams – with a particular word for those responsible for the bundles: they were refreshingly exemplary as to content and management.

Published: 23/02/2010 12:18

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