In bits and pieces

R (on the application of Cable & Wireless Ltd) v Central Arbitration Committee and CWU

When seeking recognition under the law, unions have to identify an “appropriate bargaining unit” which must not be too small or fragmented. In R (on the application of Cable & Wireless Ltd) v Central Arbitration Committee and CWU (IRLR 425, 2008), the High Court said that, when deciding on the risk of fragmentation, it was important to ascertain whether the unit was self-contained or not.

Basic facts

The Communication Workers Union asked Cable & Wireless to recognize it for collective bargaining purposes on behalf of 370 field service employees within a particular directorate, arguing that it formed an “appropriate bargaining unit” under the legislation.

The company, however, disagreed. It argued that the proposed bargaining unit was “fragmented” for the purposes of paragraph 19B(3) of the Trade Union and Labour Relations (Consolidation) Act 1992 because members of the group were employed all over the country, with sometimes no more than one or two of them in a particular branch, and comprised only 7per cent of its 4,600 workers.

Its view was that if field services could be treated as a separate bargaining unit, then so could lots of the other 29 directorates that operated at the same organisational level, a situation that would be completely unworkable.

Relevant law

Paragraph 19B (2)–(4) states that the:

“(2) The CAC must take these matters into account –
(a) the need for the unit to be compatible with effective management
(b) the matters listed in sub-paragraph (3), so far as they do not conflict with that need

(3) The matters are
(a) the views of the employer and of the union (or unions)
(b) existing national and local bargaining arrangements
(c) the desirability of avoiding small fragmented bargaining units within an undertaking
(d) the characteristics of workers falling within the bargaining unit under consideration and of any other employees of the employer whom the CAC considers relevant

(4) In taking an employer's views into account for the purpose of deciding whether the proposed bargaining unit is appropriate, the CAC must take into account any view the employer has about any other bargaining unit that he considers would be appropriate.”

Decision of CAC

The CAC panel agreed with the union, saying that the issue of whether a unit was “fragmented” was “not measured numerically as a given proportion of the workforce but in terms of whether a bargaining unit would divide up the workforce into numerous groups prone to compete with each other.” It concluded that “the stability and occupational identity of field service workers, who also have a strong company identity, militates against fragmentation”.

On that basis, it approved the proposed bargaining unit and the company applied for a judicial review.

High Court decision

However, the High Court agreed with the union. It said that Parliament had deliberately given the CAC a broad remit as an expert body with a non-legalistic approach. Courts were therefore very reluctant to intervene and overturn a decision unless the CAC “has either acted irrationally or made an error of law”.

The court accepted that small fragmented units were not a good idea but it was obvious that the real problem was the risk of proliferation that might result from the creation of such a unit. Hence the importance of ascertaining whether it was, or was not, self-contained.

It observed that fragmentation “carries with it the notion that there is no obvious identifiable boundary to the unit in question so that it will leave the opportunity for other such units to exist and that will be detrimental to effective management”.

Although the CAC’s test may be too narrow if it were applied generally, it was right in this case because the particular bargaining unit proposed by the union would not produce further fragmentation. This was because of the stability and occupational identity of field service workers.