Henry v London General Transport Services Ltd. [2001] IRLR 132
The issue as to whether a collective agreement applies to all staff was examined in Henry v London General Transport Services Ltd. Another case where the terms were not express: the individual contracts did not say that they were subject to changes introduced as a result of collective bargaining.
The case concerned platform staff for whom the T&GWU was the only recognised union. In preparation for a management buy-out the employers negotiated changes to the terms and conditions of employment. A new framework agreement was reached which included changes in rates of pay, hours of work, holidays and holiday pay, sick and overtime pay. After workplace meetings the union told management that most staff affected consented to the new terms and a notice was displayed at each workplace notifying the changes. However, some employees objected: the changes were then introduced in January 1995, a petition from the refuseniks was presented in September 1995 and tribunal claims were lodged by them nearly two years after the changes were introduced. The case was brought for unauthorised deduction of wages the refuseniks seeking to rely on the old contracts before the changes were introduced. Were all the individual contracts validly changed?
The tribunal held that whilst there had been a tradition of collective negotiation between the company and the union, the framework agreement proposed fundamental changes and it was not satisfied that the tradition was sufficient to establish that such fundamental changes were incorporated into individual contracts by virtue of collective bargaining. According to the tribunal the burden was on the employers to establish that but they had failed.
The employers successfully appealed to the EAT and the employees' cross appeal was dismissed.
In upholding the appeal the EAT considered that:
1 When determining the terms of the contract the Tribunal should adopt a neutral approach to the burden of proof.
2 For a term to be incorporated into a contract of employment the custom and practice must be reasonable, certain and notorious. Once this has been proven it must be assumed that the term applies to all relevant parties. Again the burden of proof is neutral. The tribunal had erred in distinguishing between changes and "fundamental" changes without having considered what changes had been effected in the past.
3 The fact that two petitions had been presented to the company objecting to the terms were insufficient in themselves, to justify a finding that the employees had not accepted the new terms. They had worked and been paid in accordance with the new terms for two years without further protest.
This case is a thorough restatement of the principles to be applied in interpreting contracts and the incorporation of collective agreements. It is a re-assertion of the importance of collective rights. It also establishes that it is not always enough to protest for the old contractual terms to survive.