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You are here: BAILII >> Databases >> United Kingdom Employment Appeal Tribunal >> Unison Gmb v.Brennan & Ors [2008] UKEAT 0580_07_1903 (19 March 2008) URL: https://www.bailii.org/uk/cases/UKEAT/2008/0580_07_1903.html Cite as: [2008] IRLR 492, [2008] UKEAT 580_7_1903, [2008] ICR 955, [2008] UKEAT 0580_07_1903 |
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At the Tribunal | |
On 10 March 2008 | |
Before
THE HONOURABLE MR JUSTICE ELIAS (PRESIDENT)
(SITTING ALONE)
UNISON
GMB |
APPELLANT |
SUNDERLAND CITY COUNCIL |
RESPONDENT |
Transcript of Proceedings
JUDGMENT
For the Appellants | MR ANTONY WHITE (One of Her Majesty's Counsel) Instructed by: Messrs Thompsons Solicitors The St Nicholas Building St Nicholas Street NEWCASTLE-UPON-TYNE NE1 1TH |
For the First Respondent | MR PHILIP ENGELMAN (of Counsel) Instructed by: Messrs Stefan Cross Solicitors Buddle House Buddle Road NEWCASTLE-UPON-TYNE Tyne & Wear NE4 8AW |
For the Second Respondent | MR DAVID READE (One of Her Majesty's Counsel) Instructed by: Solicitor Sunderland City Council Legal Services P O Box 100 Civic Centre SUNDERLAND SR2 7DN |
SUMMARY
Jurisdictional Points
Sex discrimination
Can an employment tribunal make a declaration that the term of a collective agreement is void, pursuant to section 77 of the Sex Discrimination Act, at the behest of a claimant who can bring proceedings under the Equal Pay Act for breach of the equality clause, where if the claim succeeds, it necessarily involves a finding that the term was unlawfully discriminatory? The EAT held that they can.
THE HONOURABLE MR JUSTICE ELIAS (PRESIDENT)
The background to the proceedings.
"(a) upon further reflection, I accept the submissions of Mr Sweeney and indeed Mr Engelman that it will be impracticable if not impossible to consider the evidence as to the first respondent's genuine material factor defence in isolation from any consideration of the claimants' application under section 77 of the Sex Discrimination Act 1975;
(b) however, for the reasons expressed in relation to my order dated 9 August 2007 – some two further months having elapsed and the claimants and the first respondent being unable to put before me any matter which would make me consider otherwise – I remain of the view that the second and third respondents would not be ready for such a hearing by early January 2008 so that the Hearing presently listed on 7 January to 1 February 2008 cannot proceed on this basis;
(c) I also remain concerned that, if the section 77 application and the genuine material factor defences are to be heard at the same Hearing, the second and third respondents may be put to some additional expense in relation to matters in which they are not involved;
(d) nevertheless, there has already been very significant delay in relation to the determination of the cases and in particular the genuine material factor defences and I do not consider acceptable any proposition that the section 77 applications are determined first with the remaining issues being considered some time thereafter;
(e) accordingly, in my judgment these issues should be considered at the same Hearing which should be relisted;"
The development of the legislation.
"(1) A term of a contract is void where –
(a) its inclusion renders the making of the contract unlawful by virtue of this Act; or
(b) it is included in furtherance of an act rendered unlawful by this Act; or
(c) it provides for the doing of an act which would be rendered unlawful by this Act.
(2) Sub-section (1) does not apply to a term the inclusion of which constitutes, or is in furtherance of, or provides for, unlawful discrimination against a party to the contract, but the term shall be unenforceable against that party.
…
(5) On the application of any person interested in a contract to which sub-section (2) applies, a County Court or Sheriff Court may make such order as it thinks just for removing or modifying any term made unenforceable by that sub-section; but such an order shall not be made unless all persons affected have been given notice of the application (except where under rules of court notice may be dispensed with) and have been afforded an opportunity to make representations to the Court."
"any provisions contrary to the principle of equal treatment which were included in collective agreements, individual contracts of employment, internal rules of undertakings, or in rules governing the independent occupations and professions, shall be or may be declared null or void or may be amended."
There is a similar provision in the Equal Pay Directive (see Article 4).
"The Directive thus covers all collective agreements without distinction as to the nature of the legal effect which they do or do not produce. The reason for that generality lies in the fact that, even if they are not legally binding as between the parties who sign them or with regard to the employment relationships which they govern, collective agreements nevertheless have important de facto consequences for the employment relationships to which they refer, particularly insofar as they determine the rights of workers and, in the interests of industrial harmony, give undertakings some indication of the conditions which employment relationships must satisfy or need not satisfy. The need to ensure that the Directive is completely effective therefore requires that any clauses in such agreements which are incompatible with the obligations imposed by the Directive upon the Member States may be rendered inoperative, eliminated or amended by appropriate means."
In other words, although discriminatory collective agreements are not enforceable, workers may not appreciate that and the ability formally to render them inoperative, or to amend them, is one of the objectives of the Directive.
"it may be admitted that the United Kingdom legislation satisfies the obligations imposed by the directive as regards any collective agreements which have legally binding effects in so far as they are covered by section 77 of the Act of 1975",
but whether they assumed that an individual claimant could already obtain a declaration to that effect is not clear. It is difficult to see how a mere declaration in the statute can be enough to comply with the Directive because it fails to resolve a dispute where the parties disagree whether the term in the collective agreement is unlawful or not. Since the purpose of amending or invalidating the agreement is to enable individuals to know what their rights are, in my judgment it must be necessary to provide a remedy to establish that a term is indeed void under section 77.
"(1) Without prejudice to the generality of Section 77 of the 1975 Act (which makes provision with respect to the validity and revision of contracts), that section shall apply, as it applies in relation to the term of a contract, to the following, namely –
any term of a collective agreement, including an agreement which was not intended, or is presumed not to have been intended, to be a legally enforceable contract;
…
…
and that section shall so apply whether the agreement was entered into, or the rule made, before or after the coming into force of this section."
"(3) For the purposes of the said Section 77 a term or rule shall be deemed to provide for the doing of an act which would be rendered unlawful by the 1975 Act if –
(a) it provides for the inclusion in any contract of employment of any term which by virtue of an equality clause would fall either to be modified or to be supplemented by an additional term; and
(b) that clause would not be prevented from operating in relation to that contract by Section 1(3) of the Equal Pay Act 1970 (material factors justifying discrimination).
(4) Nothing in the said Section 77 shall affect the operation of any term or rule insofar as it provides for the doing of a particular act in circumstances where the doing of that act would not be, or be deemed by virtue of sub-section (3) above to be, rendered unlawful by the 1975 Act."
"[(4A) A person to whom this subsection applies may present a complaint to an [employment tribunal] that a term or rule is void by virtue of subsection (1) of the said section 77 if he has reason to believe –
that the term or rule may at some future time have effect in relation to him, and
where he alleges that it is void by virtue of paragraph (c) of that subsection, that –
an act for the doing of which it provides may at some such time be done in relation to him, and
the act would be, or be deemed by virtue of subsection (3) above to be, rendered unlawful by the 1975 Act if done in relation to him in present circumstances.
(4B) In the case of a complaint about –
a term of a collective agreement made by or on behalf of –
an employer,
an organisation of employers of which an employer is a member, or
an association of such organisations of one of which an employer is a member, or
a rule made by an employer,
subsection (4A) applies to any person who is, or is genuinely and actively seeking to become, one of his employees."
The scope of the argument.
(1) If the genuine material factor defence derived from the collective agreement succeeds, then inevitably the Tribunal will have to have made a ruling that certain terms of the collective agreement operate in a discriminatory way and cannot be relied upon by the employer. In other words, it will be necessary in the course of determining the equal pay claims with respect to the period post 1 October 2005 to decide whether the term of the collective agreement is valid or not.
(2) The claimants could obtain a declaration in the High Court that the term is void.
(3) Any decision made by the Tribunal would give rise to an issue estoppel and would in principle be capable of binding the trade union. Indeed, if they had been given the opportunity to make submissions on the issue and had chosen not to do so then almost inevitably issue estoppel would run.
(4) Even absent any jurisdiction for the Tribunal formally to determine the section 77 claim with respect to the terms of a collective agreement, the union would be an interested party in the equal pay claim precisely because they would be affected by a finding that the agreement was unlawful and have an interest in the proceedings. Accordingly, in those circumstances they could apply to be joined in the action and to make representations pursuant to rule 10 (2)(r) of the Employment Tribunal rules..
(5) Furthermore, the employment judge has a discretion under the same rule to join the union as a respondent even against its will, although Mr White submitted this would be unlikely.
(1) They submitted that since the unions were already properly before the Tribunal in the section 12 claim, there was no difficulty in the Tribunal making a declaration that a term conflicted with section 77.
(2) In any event, an order declaring the rights of the parties "in relation to the act to which the complaint relates" could be given by section 65 of the Sex Discrimination Act. This provides as follows:
"(1) Where an [employment tribunal] finds that a complaint presented to it under section 62 is well-founded the tribunal shall make such of the following as it considers just and equitable
(a) an order declaring the rights of the complainant and the respondent in relation to the act to which the complaint relates;
(b) an order requiring the respondent to pay to the complainant compensation of an amount corresponding to any damages he could have been ordered by a county court or by a sheriff court to pay to the complainant if the complaint had fallen to be dealt with under section 66;
(c) a recommendation that the respondent take within a specified period action appearing to the tribunal to be practicable for the purpose of obviating or reducing the adverse effect on the complainant of any act of discrimination to which the complaint relates.
[(1A) In applying section 66 for the purposes of subsection (1)(b), no account shall be taken of subsection (3) of that section."
It is submitted that the declaration to the effect that a term of the collective agreement is void could properly fall within that language.
(3) The Equal Pay and the Equal Treatment Directives in terms require that there must be an effective remedy to deal with terms of the collective agreement which infringe either of those directives. Even if the claimants could after successfully winning in the tribunal, go to the High Court formally to obtain the declaration (which they dispute), that would not be an effective remedy because it would compel the claimants to incur unnecessary cost. It would be a real disincentive to obtaining that relief.
(4) Mr Engleman submits (but this is where his argument departs from that of Mr Reade) that section 6(4)(A) is perfectly capable of being interpreted so as to confer rights on persons who can pursue equal pay claims. The direct effect of the equal pay claim is correcting the terms of their contracts rather than the collective agreements, but the terms of the latter will apply both currently and in the future and in that context there is no reason why, as a matter of language, a claimant cannot both seek the modification of his or her contract as well as the modification of the collective agreement. They ought not to be seen as mutually exclusive remedies.
Discussion.
"First, it should be borne in mind that according to settled case law, in the absence of relevant Community rules, it is for the national legal order of each Member State to designate the competent court and to lay down the procedural rules for proceedings designed to ensure that protection of the rights which individuals acquire through the direct effect of Community law, provided that such rules are not less favourable than those governing similar domestic actions (principle of equivalence) and are not framed in such a way as to render impossible in practice the exercise of rights conferred by Community law (principle of effectiveness)."
Voor Fysiotherapeuten [1995] ECR 1-4705 the ECJ said this at para 19:
"…each case which raises the question whether a national procedural provision renders application of Community Law impossible or excessively difficult must be analysed by reference to the role of that provision in the procedure, its progress and its special features, viewed as a whole, before the various national instances."
This stresses the need to look at the question broadly.
Is there any sanction at all?
section 62 (1) of the Act which provides:
"Except as provided by this Act, no proceedings, whether civil or criminal shall lie against any person in respect of an act by reason that the act is unlawful by virtue of a provision of this Act."
Disposal.