Case - George v. Ministry of Justice (Court of Appeal)

[2013] EWCA Civ 324, Court of Appeal - John Hendy QC, Deshpal Panesar

When will a collective agreement be incorporated into a contract of employment?

When is such a term apt for incorporation into a contract?

Are the preceding negotiations relevant?

 

George v Ministry of Justice [2013] EWCA Civ 324

On 17th April 2013 the Court of Appeal (Maurice Kay, L.J.; Rimer, L.J.; Jackson, L.J.) gave its judgment in George v Ministry of Justice. In their judgment they consider the circumstances in which the terms of a collective agreement are incorporated into individuals’ contracts of employment, when such a term is ‘apt’ for incorporation, and further, what it is relevant to take into account in determining those questions.
 

John Hendy QC and Deshpal Panesar represented the Claimant.

The facts

The Claimant, who brought the appeal, was a prison officer who had worked for the Prison Service (the Ministry of Justice’s predecessor) since 1980. In the 1980s the Prison Service undertook to implement wide ranging reforms to its working practices. Prior to that time the service was highly reliant upon Officers voluntarily undertaking paid overtime to cover its operational needs at considerable cost. From 1986 to 1988 the Prison Service sought to replace voluntary paid overtime with a contractual requirement to work overtime with the provision of Time Off in Lieu (TOIL).

To that end, in 1987 the defendant’s predecessor and the Prison Officers Association entered into lengthy and detailed negotiations resulting in a collective agreement on working practices called ‘Fresh Start’. That included the abolition of overtime, which was highly valued by officers, and the introduction of TOIL to compensate officers requested by prison governors to work extra hours.

It was the Claimant’s case that it was a contractual and mandatory requirement of Fresh Start that any overtime be repaid by TOIL within a maximum of 5 weeks which the Prison Service were failing to do.

The relevant provision of Fresh Start stated as follows:

"Group managers should ensure that individual members of staff do not work high levels of additional hours without being compensated by TOIL. The aim should be for no more than five additional hours to be accumulated in any one week. Accumulated TOIL will be granted as soon as operationally possible and within a maximum period of five weeks."

The Claimant relied, amongst other things, upon the detailed written negotiations that indicated that the union’s agreement to the collective agreement was contingent upon the promise set out in the above clause that TOIL would be granted within 5 weeks. That clause was added by the Prison Service, following rejection of an earlier agreement, as part of a package stated to be ‘a final offer’ and ultimately resulted in agreement.

Whilst the judge did find that custom and practice justified the inference that there was a requirement to work overtime and to be compensated for overtime in TOIL which was incorporated into the Claimant’s contract, he found that the requirement that such overtime be repaid within 5 weeks was not. Accordingly, although the judge found that TOIL was not being provided within 5 weeks, he dismissed the Claimant’s claim on the grounds that the obligation to provide TOIL within 5 weeks was not incorporated into the contract.

The appeal

The Claimant appealed. The issues on appeal were whether the requirement to provide TOIL within 5 weeks was incorporated into the Claimant’s contract of employment expressly or by inference, and further if impliedly incorporated, whether it was apt for incorporation.

The Court of appeal dismissed the appeal. Firstly, they declined to disturb the judge’s finding that the relevant clause had not been incorporated expressly or by custom and practice.

Secondly they found further that the clause was not apt for incorporation. Nothing in their view showed that the parties intended the relevant clause to be individually enforceable by a prison officer. It was simply part of a package of provisions whose purpose was to provide non-binding guidance as to the practice to be adopted in relation to the granting of TOIL.

They stated that in their view it was improbable that the architects of the clause intended to create a regime which imposed on the Ministry an unqualified contractual obligation to grant TOIL as soon as operationally possible dispensing with the notion that the timing of the grant of TOIL was something to be agreed between employer and employee. Rather the relevant paragraph was aspirational, setting out guidelines whose working details had to be worked out either in practice or in local agreements. It was not intended to be legally enforceable by an individual employee against his employer. Notably in arriving at that conclusion Lord Justice Rimer stated that it was neither necessary nor helpful to trace through the negotiations leading to the agreement of the above provision.

Conclusion

This case gives a salutary warning to unions and those involved in the negotiation of collective agreements that, no matter how clear promises made in the course of negotiations appear to be, that unless made as contractual terms, they are at risk of being unenforceable, or regarded only as guidance to be departed from at will.

Furthermore this case also shows that collective agreements must be very carefully worded as they can be subjected to a rigorous contractual analysis years after the event, which analysis can result in their effect being different to the understanding of the employees and unions engaged in a general and fast moving negotiation at those terms are first agreed.

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