In a triumph of common sense and logic, the Employment Appeal Tribunal have upheld the rights of workers representatives to be consulted when terms and conditions of employment are changed by mass termination and the introduction of new contracts.
Most trade unionists will be familiar with an employer who wants to change terms and conditions of employment. If the workforce refuses to agree, it is not lawful for the employer to just impose the new terms. It is a common strategy for management to give notice of termination of current terms together with an offer of new employment on revised terms. Faced with what appears to be a choice between no job and a job on reduced terms, without strong trade union organisation, it is often the industrial reality that management succeed in imposing the new terms on the workforce. Whilst it is possible for each individual to claim unfair dismissal and seek reinstatement on their old terms of employment, the success rate of these cases in the Tribunals has been patchy.
But in GMB v Man Truck and Bus UK another legal weapon to protect the reduction of terms and conditions of employment has been firmly established. The EAT have held that the right to trade union consultation in collective redundancies applies wherever an employer is proposing to impose measures on a group of the workforce, on a group rather than individual basis, involving termination of their existing contracts. For consultation rights to apply, it is not necessary for there to be lost jobs or workers since the European definition of redundancy applies: "dismissal for a reason not related to the individual concerned or for a number of reasons all of which are not so related". This is a different definition to the one used in the Employment Rights Act to determine both an entitlement to a redundancy payment and the reason for redundancy.
The EAT have referred the case back to the Tribunal for an assessment of whether the employer had failed to comply with the consultation obligations. If so, the GMB members will receive a protective award.
The case of Scotch Premier Meat Ltd v Burns also considered workers' consultation rights. The duty is triggered when an employer is proposing to make 20 or more employees redundant. In this case, the company had not reached a final decision about dismissal: it had two possible plans - to close the factory or sell it as a going concern.
Only one plan would involve mass redundancies. The EAT upheld the Tribunal's view that once the company had determined on a plan of action which had two alternative scenarios one of which involved collective redundancies, they had a "proposal" which triggered the duty to consult the workforce. But in an aside, the EAT said that the word "propose" has a narrower meaning than the term "contemplate" which is when the duty arises in European law.