The law allows workers to lodge a claim against an employer who has offered them an inducement to forego their collective bargaining rights. In Scottish Borders Housing Association Ltd v Caldwell and ors, the Employment Appeal Tribunal (EAT) held that when lodging a claim, time runs from the date of the offer of inducement by the employer and not the date when the employees are notified that a change is going to be implemented.
The claimants’ union, Unite, instructed Thompsons to act on its behalf.
Basic facts
The housing association wanted to make changes to its pay scheme and engaged in negotiations with the recognised trade unions. However, these proved to be unsuccessful and it decided to meet with the staff to make the offer directly to them.
As most indicated a willingness to accept the revised terms, the association wrote to them on 18 September 2019, setting out how the changes would affect them and what their new pay grades and salary would be. It added that they should sign and return their copy of the offer by 21 October 2019 if they were willing to accept the variation. Of 104 employees, 96 did so.
On 13 December, the association wrote to the outstanding employees, informing them that the changes would come into effect on 16 January 2020, whether or not they agreed. The employees lodged tribunal proceedings on 28 January, arguing that their employer had breached section 145B of the Trade Union & Labour Relations (Consolidation) Act 1992 which deals with “inducements relating to collective bargaining”.
Relevant law
Section 145B states that trade union members have the right not to have an offer of inducement made to them if accepting it would mean that their terms of employment would no longer be determined by collective agreement.
Section 145C(1)(a) states that proceedings have to be lodged within three months “beginning with the date when the offer was made” or (b) if that was not reasonably practicable then “within such further period as [the tribunal] considers reasonable”.
Tribunal decision
The first issue to be decided was whether the claims were brought within the time limit set out in section 145C(1)(a).
The tribunal reasoned that as contracts of employment cannot be varied without mutual agreement, express or implied agreement on the part of the workforce was required to effect a binding change to terms and conditions following the December letter.
It therefore concluded that, as the December letter related to the same proposed change to terms and conditions as the September letter, both formed part of a series of similar offers to the claimants for the purposes of section 145C. As the date of the last offer in that series was 13 December 2019, the claim was in time.
The housing association appealed, arguing that only the September letter constituted an offer. The December letter, by contrast, was not concerned any longer with negotiation but was instead focused on how the changes would be implemented.
EAT decision
The EAT agreed with the employer that the December letter did not constitute a contractual offer. Instead it was an indication of their intention to impose the change contained in the letter of 18 September 2019 with effect from 16 January 2020. As such, this was no longer a negotiation of the new contract, but notification of the implementation of the new terms.
The EAT therefore concluded that an employer who has indicated their determination to unilaterally impose new terms cannot be said to offer new terms under section 145B. As such, the claims were out of time.
Comment
This case highlights a useful distinction between the “offer” of a new contract, which is capable of acceptance by the employee either expressly or impliedly through conduct; and the unilateral imposition of a new contract, a process which does not contain an “offer” by the employer and is therefore not capable of acceptance by the employee.