R Lidl Ltd v Central Arbitration Committee GMB (Interested Party)
| Jurisdiction | England & Wales |
| Judge | The Honourable Mr Justice Lewis |
| Judgment Date | 10 August 2016 |
| Neutral Citation | [2016] EWHC 2040 (Admin) |
| Court | Queen's Bench Division (Administrative Court) |
| Docket Number | Case No: CO/3013/2016 |
| Date | 10 August 2016 |
[2016] EWHC 2040 Admin
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
ADMINISTRATIVE COURT
Royal Courts of Justice
Strand, London, WC2A 2LL
The Honourable Mr Justice Lewis
Case No: CO/3013/2016
and
Daniel Barnett (instructed by Gregsons Solicitors) for the Claimant
Aileen McColgan (instructed by Leigh Day) for the Interested Party
The Defendant did not appear and was not represented
Hearing date: 15 July 2016
APPROVED JUDGMENT
INTRODUCTION
This is a claim for judicial review of a decision of the Central Arbitration Committee ("the CAC") dated 15 May 2016. By that decision, the CAC decided that a bargaining unit described as "Warehouse Operatives in the following sections: Goods In, Goods out and Selection" at the Bridgend Regional Distribution Centre of the employer, Lidl Ltd, was an appropriate bargaining unit for the purposes of Schedule A1 to the Trade Union and Labour Relations (Consolidation) Act 1992 ("the 1992 Act").
The Claimant is Lidl Ltd, the employer. There are three grounds of challenge. First, it is alleged that the CAC misconstrued the relevant provision of Schedule A1 to the 1992 Act. Secondly, it is said that the CAC failed to give adequate reasons for its conclusion on a material issue. Thirdly, it is said that the CAC failed to have regard to two material considerations, namely a previous decision of the CAC in another case and an extract from a dictionary on the meaning of fragmentation.
THE STATUTORY FRAMEWORK
Schedule A1 to the 1992 Act deals with the recognition of bargaining units within the workforce. The provisions are complex. In essence, a trade union may make a request to an employer seeking recognition to be entitled to conduct collective bargaining on behalf of a group or groups of workers: see paragraphs 1 and 4 of Schedule A1 to the 1992 Act. References to collective bargaining are references to negotiations relating to pay, hours and holidays: see paragraph 3 of Schedule A1. If the employer does not agree to a valid request, or fails to respond, then the union may apply to the CAC, established pursuant to section 263 of the 1992 Act, for a decision on whether the proposed bargaining unit is appropriate. If matters are not resolved, paragraph 19(2) of Schedule A1 to the 1992 Act provides that:
"(2)….. the CAC must decide whether the proposed bargaining unit is appropriate."
Paragraph 19B provides that:
"(1)) This paragraph applies if the CAC has to decide whether a bargaining unit is appropriate for the purposes of paragraph 19( 2) or (3) or 19A( 2) or (3).
"(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;
(e) the location of workers.
"(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.
"(5) The CAC must give notice of its decision to the parties."
Paragraph 171 of Schedule A1 to the 1992 Act provides that:
"In exercising functions under this Schedule in any particular case the CAC must have regard to the object of encouraging and promoting fair and efficient practices and arrangements in the workplace, so far as having regard to that object is consistent with applying other provisions of this Schedule in the case concerned."
The role of the CAC is to determine whether the proposed bargaining unit is appropriate, that is, is suitable for the purpose for which it is to be used, namely the conduct of collective bargaining in respect of a group of workers. The CAC should first consider the proposed bargaining unit and determine if that proposal is appropriate rather than seeking to determine whether the proposed unit would be the best or most appropriate bargaining unit: see R v Central Arbitration Committee ex p. Kwik-Fit (GB) Ltd. [2002] IRLR 395.
THE FACTS
The relevant facts appear from the decision of the CAC. Lidl UK GmBH is a company registered in Germany. It operates 637 supermarket stores in England, Wales and Scotland and nine Regional Distribution Centres. It is, in turn a subsidiary of Lidl Stiftung & Co., ("Lidl International"), a company which operates in 26 countries in Europe and other countries outside Europe.
The Claimant, Lidl Ltd., is a service company supplying staff to Lidl UK GmBH for the purposes of operating the supermarkets and the Regional Distribution Centres. It is the employer of the staff concerned. The interested party, the GMB ("the Union"), requested that it be recognised for collective bargaining for a group of workers described as "Warehouse Operatives working in the following sections: Goods In, Goods Out and Selection" employed at one of the nine Regional Distribution Centres, that is the centre at Bridgend. Following a failure to agree a bargaining unit, the Union applied to the CAC to determine whether its proposed bargaining unit was an appropriate bargaining unit. The CAC established a Panel of three individuals to determine that question. The Claimant and the Union made written and oral submissions to the Panel. On the day of the hearing, the Claimant sought to rely on a decision of the CAC in another case, together with an extract from the Oxford English Dictionary dealing with the meaning of "fragmentation". Following a short adjournment, the Panel decided not to allow that material to be relied upon before it. It noted, in its decision, that previous CAC decisions did not have any precedent value for the current panel of the CAC dealing with the present application.
The decision of the CAC should be read in its entirety. In its decision, the CAC recorded the material provisions of paragraph 19(2) and 19(3) of Schedule A1 to the 1992 at the outset of its decision. It recorded a detailed summary of the Union's submissions on why its proposed bargaining unit was appropriate. The CAC also recorded a detailed summary of the Claimant's submissions.
The CAC noted that the Claimant employed 18,203 staff to operate the 637 stores and Regional Distribution Centres in England, Wales and Scotland. It noted that decisions on pay, hours and holidays were taken by Lidl International, and that employees were categorised, worldwide, according to eight principal categories. The CAC noted that the UK operation was co-ordinated from the head office at Wimbledon but day-to-day operation functions were divided into nine major geographical areas, each with its own administrative, warehouse and distribution centre. Bridgend was one of these nine Regional Distribution Centres. The CAC noted that warehouse operatives were categorised as category 6 employees and that that categorisation also included store workers and junior office staff. The total number of category 6 employees was 14, 675 or 81% of the total UK workforce of 18,203. The proposed bargaining unit of warehouse operatives at the Bridgend Regional Distribution Centre comprised approximately 223 employees or 1.2% of the total workforce of 18,203. The Claimant emphasised that it operated what was described as a one Lidl culture, comprising one organisation with a single set of policies and procedures.
The CAC noted the submission of the Claimant that the Union's proposed bargaining unit was based on a description which involved what the Claimant described as double segmentation, that is it involved establishing a bargaining unit by reference both to job description and location. The proposed bargaining unit comprised only warehouse operatives (not all workers in category 6) and only those operatives who were based at one particular location, the Bridgend Regional Distribution Centre. The Claimant submitted that the degree of fragmentation involved was not compatible with efficient management. It also relied upon the desirability of avoiding small fragmented bargaining units within an undertaking. It submitted to the CAC that the Union's proposed bargaining unit covered only 1.2% of the employer's 18,203 employees in the UK and just 1.5% of the employer's 14,675 category 6 employees in the UK. It contended that the proposed bargaining unit would result in local fragmentation within the Bridgend Regional Distribution Centre, leading to tension between the 223 Warehouse Operatives and the other category 6 employees employed in, or costed to, the Bridgend Regional Distribution Centre, and the remainder of 2,443 Warehouse Operatives in the other eight regions. The employer submitted that the logical consequence would be recognition of a substantial and unworkable number of bargaining units each competing with one another. The decision of the CAC records the submissions of the employer on the other factors relevant to its decision.
The material parts of the decision of the Panel are contained in the following paragraphs of its decision:
"32. The panel considers that the Union's proposed bargaining unit is compatible with effective...
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