The CAC upheld a complaint made on behalf of employees that the University had failed to comply with its obligations under the Regulations in relation to the appointment or election of negotiating representatives. Under the Regulations, in circumstances where at least 10% of employees have submitted a formal request, an employer is (subject to certain qualifying criteria) obliged to  put in place arrangements for employees to appoint or elect representatives and for all employees to take part in the appointment or election process. Although it already had collective bargaining arrangements in place with two recognised unions, the University accepted that, having received such a request, these arrangements needed to be amended or extended. It therefore invited the two recognised unions (whose members together constituted approximately 25% of the workforce) each to nominate two candidates at a meeting that would be attended by representatives of those two recognised unions. The employees submitted an application to the CAC, arguing that this process did not comply with the requirements of Regulation 14. The CAC upheld their complaint. The University had interpreted its obligations too narrowly and had focused primarily on maintaining the status quo: its employees had been asked simply to ratify a course of action that the University saw as being its preferred option. The process adopted by the University was insufficiently inclusive and had failed to enable non-union employees to participate meaningfully in the formation of a new consultative forum. The University appealed, broadly on the ground that the CAC had misunderstood the meaning of Regulation 14 by failing to recognise that, whilst the University was obliged to put a suitable arrangement in place, it was for the University to decide whether and how representatives should be elected or appointed.

The EAT dismissed the appeal. The purpose of the Regulations was to make existing arrangements more effective by enabling the workforce as a whole to participate meaningfully in obtaining information and engaging in consultation. The issue ultimately rests on whether any given arrangement enables effective participation. On the particular facts of this case, the CAC was entitled to reach the conclusion that the University's proposed arrangement did not satisfy the wider purpose of the Regulations.

Tim Crane, Employment Law Solicitor

________________

Appeal No. UKEAT/0285/15/RN

EMPLOYMENT APPEAL TRIBUNAL

FLEETBANK HOUSE, 2-6 SALISBURY SQUARE, LONDON EC4Y 8AE

At the Tribunal

On 15 January 2016

Before

THE HONOURABLE MR JUSTICE LANGSTAFF

MRS R CHAPMAN

MR C EDWARDS

UNIVERSITY OF LONDON (APPELLANT)

MORRISSEY (RESPONDENT)

Transcript of Proceedings

JUDGMENT

For the Appellant
MR DAVID READE (One of Her Majesty's Counsel)
Instructed by:
Messrs Pinsent Masons LLP
1 Park Row
Leeds
LS1 5AB

For the Respondent
MR JASON GALBRAITH-MARTEN (One of Her Majesty's Counsel)
and
MS SARAH FRASER-BUTLIN (of Counsel)
Instructed by:
Messrs Leigh Day Solicitors
Central Park
Northampton Road
Manchester
M40 5BP

CENTRAL ARBITRATION COMMITTEE (CAC)

A Panel of the Central Arbitration Committee held that the University had not complied with Regulation 14 of the Information and Consultation of Employees Regulations 2004. The University had recognised a need to negotiate an agreement to inform and consult its employees. To do so it was to put in place arrangements for the employees to appoint or elect representatives and for all employees to take part in the process of appointment or election. The Panel held it had done neither when it asked trade unions which it recognised, whose members were a minority of the workforce, to put up four names who would be the representatives of all employees, and then held a "Yes"/"No" vote on nominees identified by the employer and trade unions jointly, arranging that all employees would "take part" in the appointment and election. An appeal was dismissed: having regard to the purpose of the Regulations, which implemented a Directive seeking to ensure the effective engagement of all employees, ensuring that the rights would be effective, and endorsing the application of good industrial practice, the decision of the Panel was one which on the particular facts of the case the Panel was entitled to reach.

1. This is an appeal against a decision of the Central Arbitration Committee ("CAC") made by a Panel chaired by Professor Lynette Harris and consisting also of Mr Len Aspell and Mr Bob Purkiss MBE made on 3 August 2015. The CAC upheld a complaint that had been made to it under Regulation 15(1) of the Information and Consultation of Employees Regulations 2004 that the requirements for the appointment or election of negotiating representatives set out in Regulation 14(2) had not been complied with. An appeal lies on the point of law to the Employment Appeal Tribunal under section 21 of the Employment Tribunals Act 1996. On this appeal the University, as we shall call it, has been represented by Mr Reade QC, and the Respondent, Ms Morrissey, by Mr Galbraith-Marten QC and Ms Fraser-Butlin.

1. The Regulations concerned were an implementation of a European Directive that required the establishment of a general framework for informing and consulting employees in the European Community. We shall have more to say about the particular terms of the parent Directive in the course of our Judgment. The Regulations provide in part for employees to negotiate an agreement with their employer under which the employer agrees to inform and consult those employees as required by the Regulations and Directive. The Regulations set out a complex structure for securing the rights conferred on employees. The employer is not under an automatic duty to set up or reach an agreement on information or consultation arrangements. It may initiate a negotiating process even in the absence of any interest shown by employees but is only obliged to do so if there is a request of at least 10 per cent of the employees in an undertaking, subject to a minimum of 50 employees and a maximum of 2,500 (see Regulation 7). Once such a request is made, the employer must undertake negotiations to seek to reach an agreement on information and consultation arrangements pursuant to Regulation 14.

1. The Regulation 14 process is thus to ensure that the employees are represented appropriately in negotiations with their employer in order that as a consequence of those negotiations there will be an agreement relating to information and consultation that fits the requirements of Regulation 16. Regulation 14 itself - which we hope to have put in context by those words, which are drawn almost verbatim from an earlier decision made by this Tribunal, presided over by Elias J, as he then was Moray Council v Stewart UKEAT/0143/06 (20 April 2006) - is headed "Negotiations to reach an agreement" and provides, materially, so far as follows:

"(1) In order to initiate negotiations to reach an agreement under these Regulations the employer must as soon as reasonably practicable -

(a) make arrangements, satisfying the requirements of paragraph (2), for the employees of the undertaking to elect or appoint negotiating representatives; and thereafter

(b) inform the employees in writing of the identity of the negotiating representatives; and

(c) invite the negotiating representatives to enter into negotiations to reach a negotiated agreement.

(2) The requirements for the election or appointment of negotiating representatives under paragraph (1)(a) are that -

(a) the election or appointment of the representatives must be arranged in such a way that, following their election or appointment, all employees of the undertaking are represented by one or more representatives; and

(b) all employees of the undertaking must be entitled to take part in the election or appointment of the representatives and, where there is an election, all employees of the undertaking on the day on which the votes may be cast in the ballot, or if the votes may be cast on more than one day, on the first day of those days, must be given an entitlement to vote in the ballot."

The other provisions of Regulation 14 are not material to the present discussion.

1. If there are no negotiations in accordance with Regulation 14 or no agreement, then default provisions apply. They are provided for by Regulations 18 and 19. The latter incorporates Schedule 2 into the Regulations, which provides a highly prescriptive and detailed arrangement for the conduct of a ballot and the making of arrangements in advance of the ballot to provide for representatives of the employees.

1. It will be obvious from what we have already cited of Regulation 14 that it is very broad and general in the sense that it is not at all prescriptive. The reasoning for that was identified by Elias J at paragraph 4 of the Moray decision:

"4. … the Government's intention was that these Regulations should permit a certain amount of flexibility in the way in which the arrangements were made, and to support agreements voluntarily established. …"

1. Thus Parliament provided for a bespoke arrangement suitable to the particular needs of the undertaking to be adopted by operation, in part, of Regulation 14. We note that Regulation 14 will inevitably apply to many different forms of undertaking with many different structures and, it may be, with workforces stratified in many different ways. Arrangements that might be entirely appropriate to one might not be to another, hence the desirability of a bespoke arrangement. Such an arrangement would naturally be negotiated in the knowledge that if none could be, the default provisions would then apply.

1. The CAC Panel recorded at paragraph 72 that Ms Morrissey, on behalf of employees of the University, submitted a request to the CAC that the employer should establish information and consultation arrangements under the Regulations. One hundred and sixty-two employees made that request. The number of employees of the University was 1,206. It was therefore a proportion of more than 10 per cent making that request. Regulation 7 required in such circumstances that the employer should initiate negotiations by taking the steps set out in Regulation 14(1). The employer already had collective bargaining arrangements in place with two unions that it recognised. Those included, as it happens, information and consultation processes, but it accepted that in light of the request made by Ms Morrissey those arrangements needed to be amended or extended. The employer invited the two recognised unions, which between them had something in the region of 25 per cent of the workforce in membership, thereby leaving something like 75 per cent, on our very broad calculations, not in their membership, each to nominate two candidates at a meeting that would be attended by representatives of those two recognised unions.

1. The Panel observed that as a result there were no discussions involving non-union employees about the form of any new consultative forum or about the appointment of representatives. At paragraph 75 of its Decision it regarded the employer as having limited discussions concerning the appointment or election of negotiating representatives to the union representatives from the two trade unions recognised for collective bargaining, and by doing so considered it had not put into place arrangements that took into account the representation of all employees even although the parties agreed that the majority of the workforce was not in union membership. At paragraph 76 it considered that the employer appeared to have viewed information and consultation arrangements under the 2004 Regulations as an extension to its collective bargaining machinery; the employer had not considered any other arrangements. At paragraph 78 the Panel considered that the employer had made no attempt to invite non-union members to put forward candidates for appointment or election, nor to put across a clear message that the union representatives would also represent non-members, nor explain how that could take effect, and thought that the employees were being asked to ratify a course of action that the employer saw as being its preferred outcome.

1. We note here that there is no challenge to these findings on the ground of perversity. Insofar as they are factual therefore they must stand. The challenge is instead that they demonstrate a failure of approach, in that it is said that the Panel misunderstood the proper meaning of Regulation 14.

1. The Panel said at paragraph 80 that it thought that there was no need to go any further to reach its decision. It had, in effect, considered that the employer was focussed on maintaining the status quo, that it had not been sufficiently inclusive in its approach to non-union members who were employees, that it had asked employees to ratify a course of action which was its preferred outcome as opposed to adopting an outcome that the employees preferred and thereby, without articulating precise points other than we have described, came to a conclusion indicating it took a broad view of the meaning of Regulation 14. It went on in paragraph 80 to deal with what it saw as being that meaning. It did so in these terms:

"80. … However, [the Panel] noted from the extensive submissions from both parties that there was disagreement over the interpretation of the wording of Regulation 14(2)(b) in terms of what is intended by taking part in the election or appointment of the representatives. The panel concluded that it is a narrow interpretation if it is taken to mean simply that all employees should be able to cast a vote but do not play a part in the nomination of the representatives they are voting upon. This narrow interpretation was the one adopted by the Employer whose arrangement to reach an agreement limited the nominations to just representatives from the two recognised trade unions, even though the subsequent ballot was open to everyone. The choice was thus constrained by this interpretation and there were no discussions with representatives across the workforce in terms of seeking nominations which would follow from a wider interpretation of regulation 14(2)(b).

81. It was the view of the Panel that the Employer had fallen short of good industrial relations practice both in terms of its arrangements for appointing representations [sic] and the subsequent ballot. It was an extremely short time scale from the announcement of the ballot to its closure and it lacked confidentiality as the HR Department, in monitoring that there was no repeat voting, had access to how an individual employee voted."

The Panel was accordingly not persuaded that the employer had complied with the requirements of Regulation 14(2).

1. Thus far it had dealt specifically just with Regulation 14(2)(b). It next turned its attention to Regulation 14(2)(a) and declared itself not satisfied that there was a process by which all employees would be represented by one or more representatives:

"82. … In relation to 14(2)(b), the Panel is not satisfied that the Employer has met the requirement that all the employees "must be entitled to take part in the election or appointment of representatives". It was unacceptable to expect employees to vote yes or no to four candidates that resulted from the arrangements agreed between the Employer and the two recognised unions without the Employer putting in place arrangements which allowed for alternative candidates to be put forward."

1. It was on that basis that the Panel found Ms Morrissey's complaint to be well founded.

1. The grounds of appeal are better described by considering the oral submissions made to us by Mr Reade QC than by examining each of the grounds, which are numbered from 6.1 to 6.8, in turn. In essence, his submission was that central to the decision was a view taken by the Panel of that which Regulation 14 required. He argued that Regulation 14(1) left it to the employer to make the necessary arrangements. They were at the discretion of the employer; it was for the employer to decide whether representatives should be elected or appointed. The requirements set out in Regulation 14(2) were requirements as to outcome. As to Regulation 14(2)(a), the election was to be arranged in such a way that all employees were represented. That could not, in his submission, mean that all were happy with their representation. It meant much the same as might be the case in a Parliamentary constituency returning an MP, where it may well be that less than 50 per cent of the electorate would positively support the chosen representative.

1. The outcome that would be the litmus test of this requirement having been satisfied would be the ability to go to any employee after the process and say, "Are you represented? Who is your representative?" and provided that they could answer that they had one, then that provision was satisfied. It was not necessary to consider any aspect of the quality of representation or the nature of it. He contrasted the highly prescriptive requirements of Schedule 2 with the requirements of Regulation 16, which are only somewhat prescriptive, to indicate that Parliament could have prescribed how the employer should proceed but had deliberately left matters flexible. As to Regulation 14(2)(b), again he took the approach that in a case such as the present an employee who voted to approve or, as it may be, disapprove of the proposed four representatives would be taking part in the appointment. He recognised that the process that had happened was, as he saw it, a process of appointment and not of election. There had been something that therefore amounted to a taking part.

1. Since those were the two requirements of arrangements that it was open flexibly for the employer to adopt at his discretion, what had happened in the present case satisfied Regulation 14. The panel was thus in error in adopting the approach it did. It failed properly to direct itself that it was for the employer in its sole discretion to determine whether there should be election or appointment, and the process that was to be put into effect, that (contrary to a hint in paragraph 74 of the CAC's Decision) there was no obligation on the employer to meet with any other representatives of the employees than the trade unions it habitually met with, that the employer was entirely free if it chose, as it did, to discuss arrangements only with trade unions it recognised, that the CAC had failed to recognise that those selected by this process of appointment would be representatives of all: just as in a Parliamentary constituency, so here, everyone was represented, there was no obligation to consider alternative arrangements, and evidence of the union's commitment to the representation of all employees was not relevant. (This last point was a reference to the Panel's view expressed at paragraph 78 that an email from one of the two unions showed that it considered that the arrangements proposed by Ms Morrissey were anti-union, indicating a view hostile to representation of all). The CAC had not reached a decision on the central issue of statutory interpretation (that point rather fell into a sotto voce comment in that the hearing before us proceeded largely upon the basis that the Panel had adopted the view it had expressed at paragraph 80; if it is necessary to say so, we think that, properly construed, the Panel was saying that it wished to adopt a wide and not a narrow interpretation).

1. In reciting those submissions we have encapsulated grounds 6.1 to 6.8 of the grounds of appeal, the last ground, ground 6.9, being a portmanteau roll-up.

1. It is convenient to consider Mr Galbraith-Marten QC's response when dealing with our conclusions on these arguments.

1. Central to any question of construction of the Regulations is the purpose of those Regulations. Since the purpose of these Regulations is to implement a European Directive, the recitals and content of that Directive are relevant. The Directive 2002/14 EC has these material recitals:

"(1) … a particular objective of the Community and the Member States is to promote social dialogue between management and labour.

…

(6) The existence of legal frameworks at national and Community level intended to ensure that employees are involved in the affairs of the undertaking employing them and in decisions which affect them has not always prevented serious decisions affecting employees from being taken and made public without adequate procedures having been implemented beforehand to inform and consult them.

(7) There is a need to strengthen dialogue and promote mutual trust within undertakings in order to improve risk anticipation, make work organisation more flexible and facilitate employee access to training within the undertaking while maintaining security, make employees aware of adaptation needs, increase employees' availability to undertake measures and activities to increase their employability, promote employee involvement in the operation and future of the undertaking and increase its competitiveness."

1. Reference may also be had to recitals 8 to 17 and 23.

1. Article 1, paragraph 2 says:

"2. The practical arrangements for information and consultation shall be defined and implemented in accordance with national law and industrial relations practices in individual Member States in such a way as to ensure their effectiveness."

We consider this paragraph to be of some importance. As part of Mr Reade QC's argument, indeed reflected by ground 6.8 of the Notice of Appeal, it was submitted to us that the Panel had no business in deciding the matters that it did by reference in part, as it did at paragraph 81, to a broad consideration of good industrial relations practice. We accept Mr Galbraith-Marten QC's retort that that is the very thing that Article 1, paragraph 2 endorses. Moreover, he would point out - with, we think, force - that the decision of this Tribunal in Moray and a subsequent decision in an analogous field of Regulations relating to the appointment of representatives who had authority to negotiate under section 188 as to redundancies - the decision of[Kelly and Anor v The Hesley Group Ltd ]()UKEAT/0339/12 (19 April 2013), which, as it happens, was the decision of a Panel including two of the members of the present Panel - tend to support it. In Kelly the entitlement of the Panel concerned to make a decision in accordance with broad matters of industrial practice might be said to be recognised. We need go no further for present purposes than to say that those two decisions are consistent with and tend to lend further support to Mr Galbraith-Marten QC's approach.

1. The purpose of the Regulations, as a whole, therefore, is to engage the workforce as a whole, to involve them all in the (often sensitive) process of obtaining information and engaging in consultation to a greater extent than had been the case prior to the 2002 Directive. The Regulations were intended to facilitate the engagement of employees - that is, all employees in the workforce - in general terms in that process, as the recitals suggest. It seems to us, agreeing here with Mr Reade QC, that Regulation 14 deliberately provides for a significant element of flexibility. It has to accommodate a wide variety of circumstances. It is part of the purpose to provide for tailoring an arrangement between employees and employer that will best suit the particular demands of both in that undertaking, though such an arrangement will, as we have noted, be negotiated knowing that if negotiations fail specific default provisions will apply.

1. We are therefore inclined to think that the absence in Regulation 14 of detailed prescriptive provisions, by contrast with Schedule 2 and to some extent Regulation 16, and in contrast to the detail of both the provisions provided for by section188 of the Trade Union and Labour Relations (Consolidation) Act 1992 and those provided for the election of representatives in order to obtain information, and for consultation purposes, in respect of the Transfer of Undertakings (Protection of Employment) Regulations 2006, is deliberate. These provisions, particularly those contained in the TUPE Regulations, are indicative of the type of provisions that generally parties might wish to aspire to. We do not consider that the fact that other sections of statute or Regulations go to significant length to be prescriptive as to process means that the process provided for by Regulation 14 is entirely at large. It has to reach a conclusion, which, given the Directive, must be reached in such a way as to ensure the effectiveness of the practical arrangements for information and consultation which are to be implemented.

1. Mr Galbraith-Marten QC in his submissions threw up the prospect of placemen being effectively placed in position by an employer, if they are the only candidates for selection put forward - which would provide for no effective engagement of the employees as a whole in the process of selection, albeit that the workforce might have the derisory sanction of voting against the chosen nominees. Mr Reade QC responded that if that occurred nonetheless the parties might return in order again to request negotiation of an agreement, which they would have a right to do under the Regulations. We think it necessary only to note that the arrangements put in place should be with a view for the effective representation of all employees, and we would emphasise all employees rather than a section of employees. There is considerable discretion within Regulation 14 to achieve that end. The particular way in which an employer will satisfy the requirements of Regulation 14 will depend inevitably on the particular facts and circumstances of a particular case. There may be cases in which it is entirely appropriate for an employer to enter discussions with unions it recognises and evolve a process that satisfies Regulation 14. There may be other cases in which the CAC is entitled to think that the process would not lead to effective representation. Although the word "effective" does not appear in the Regulations, they must, in our view, be read, as we think the Panel read them: that if it concluded that effectiveness was absent, this would indicate that the Regulations had not been faithfully applied.

1. We note in this context that Regulation 14(1)(a) does not provide that the employer itself may make arrangements to elect or appoint negotiating representatives. The important words "for the employees of the undertaking" appear before the words "to elect or appoint". In other words, the arrangements are to be made so that the employees can undertake that task. We accept Mr Galbraith-Marten QC's point that that indicates that employees are to that extent in the driving seat, although we recognise that in different enterprises the practical approach may differ from those that are taken in others. Both practicality and effectiveness has, as it seems to us, to be achieved.

1. The requirements under Regulation 14(2), which any process under Regulation 14(1) has to satisfy, are, so far as Regulation 14(2)(a) is concerned, largely a question of what might be called "constituency" and under Regulation 14(2)(b) what might be broadly described as "participation".

1. Regulation 14(2)(b) was the first to which the Panel turned its attention. Here, the argument before us centred upon the meaning of the words "take part". Mr Galbraith-Marten QC submitted that the words are "to take part in the election or appointment of the representatives and, where there is an election …" thereby indicating that "taking part" was contemplated as being a process wider than merely casting a vote in an election. The "taking part" and the electoral process itself were distinct.

1. If that is so, and we think it is, it does not necessarily answer the question before us, because we have Mr Reade QC's submission that this was not an election but an appointment. That, however, does not sidestep the point entirely. If the words "take part" have a force beyond participation in the actual voting itself, to envisage participation in some form in the processes that lead to it, then the words have to be broadly construed. There is no reason why they should be broadly construed so far as election is concerned but narrowly construed so far as appointment goes. They must have the same thrust. We consider, therefore, that this provision calls for participation of a meaningful kind by the employees in the process of election or appointment and, as is plain from our view as to the purpose of the Regulations, this involves the engagement of all of the employees so far as can be achieved; that this should give an opportunity to all employees to participate.

1. Though facts will differ from one case to another, we therefore consider that the Panel was entitled in the present case to conclude that the participation of the employees of the University was not the meaningful participation that the Regulations anticipated in context. The decision it reached, not perverse on the facts, was one that, in short, it was entitled to reach.

1. As to Regulation 14(2)(a), the representation is in context to be by those representatives who are envisaged to be effective representatives. Plainly they do not have to carry the confidence of all, but they must represent all. We see no reason to think that, in general, members of a trade union will not represent the workforce more generally, as, for instance, may be the case when they negotiate a collective bargaining agreement that once agreed will apply to all employees, or cover all employees, as the word was explained in the Moray case, but the question here is, again, as it seems to us, one of fact and degree for a Panel, accustomed to the application of industrial practice, to determine.

1. In the course of the argument Mr Galbraith-Marten QC was invited to give his definition of what representation entailed. He ducked the issue, and argued that it was a matter that a panel applying proper industrial practice could recognise: difficult to describe, though easy to recognise - or at least, it was easy to recognise its absence. Mr Reade QC in his response criticised Mr Galbraith-Marten QC, understandably, for not attempting a dictionary definition of the word. He proposed, as we have noted, that if the question be asked of any employee, "Do you have a representative?" they would say yes or no. The difficulty with that argument is it still leaves the word "representative" undefined. After all, the lawyer, if he ever were in the position of an employee, might respond to the question by asking, "What do you mean by 'representative'?" The argument, though interesting, takes us no further forward.

1. We conclude that representation in this context can be and has to be left to the panel to determine, bearing in mind that what is sought by the Directive is effectiveness. What the Regulations seek to achieve is demonstrably not that placemen acceptable to the employer, but only to a minority of the workforce, should be representatives, however much that might fall within the wording of the Regulation if narrowly approached. There may be many circumstances in which a Panel might for itself have thought different representatives would be more suitable, but nonetheless conclude that there was no failure to satisfy Regulation 14(2)(a), but it is, in our view, entitled by the application of industrial common sense, practice and experience able to determine that in a situation such as the present for the reasons that it expressed, there was an absence of compliance with Regulation 14(2)(a). In short, the issue is not to be determined by the question of whether individuals are, at the conclusion of a process, given authority by the workforce generally to negotiate, but whether they are given meaningful authority, that to be judged in context.

1. We read the conclusion of the Panel here as being that the authority that the representatives selected in the present case would not be meaningful in that sense, because of the way in which they were proposed by the employer together with the unions, to be drawn from a small group only of the employees when all employees were to be represented, albeit that the employee workforce thereafter had the opportunity to approve the candidates who were proposed.

1. We have not in the course of this decision - rejecting, as will be plain, the arguments seductively put to us by Mr Reade QC - dealt with every single point that has been raised. We have not found it necessary to deal with the case of Moray in greater detail than we have, though Mr Reade QC founded some arguments upon it, since it deals with Regulation 8 and not Regulation 14 (on which there is no direct authority) and since on the particular facts of that case the majority of the workforce concerned were union members. These are the distinctions that the Panel had made between that case and the present; they were not inappropriate, and we therefore do not see in the decision anything that dissuades us from the view that we have taken of these particular provisions.

1. With great gratitude to the advocates and, if I may add, with appreciation of the short and focused grounds in the Notice of Appeal, the short and focussed nature of which is entirely appropriate and has achieved far more than much longer Notices would have done, and recognising, as we do, that each case in this area must inevitably depend upon its own facts, we dismiss this appeal.