An Implementation Agreement was apt for incorporation into the claimants' employment contracts since it made it clear that if there was a re-grading structure policy, and that if the trade unions were properly consulted and an agreement reached, then the policy was to take effect.
The claimants (C) appealed the decision of HH Judge McNaught dismissing the claim against the defendant (S) in an action concerning the implementation of terms in Cs' contracts of employment. Cs' contracts of employment with S stipulated that their terms and conditions of employment were in accordance with collective agreements negotiated from time to time by the National Joint Council (NJC), as varied by local collective agreements reached with recognised trade unions. S adopted a new pay and grading policy with the result that a new collective agreement was entered into with retrospective effect. The relevant collective agreement negotiated by the NJC was contained in the "Green Book". The Green Book included an Implementation Agreement which provided for the introduction of new negotiating machinery for local government employees involving a job evaluation scheme based on common criteria in accordance with equal pay legislation. The Implementation Agreement identified the policy and its guiding principles, set out the procedure by which jobs were to be re-evaluated and how the new grading structure was to be put into place. On 26 June 2000 S adopted a new pay and grading structure subsequent to a job evaluation exercise which had involved the relevant trade unions. The new pay and grading structure was to take effect from 1 April 2001, the effect of which was to downgrade C. By that downgrading, Cs' pay was frozen until 2006 with the result that pay increments and living allowance increments were not to be paid. By these proceedings C sought the sums that they would have been entitled to for those increments. The judge found that the Implementation Agreement was apt for incorporation into Cs' contracts of employment and accordingly entitled S to make the changes to the pay and grade structures. This was an appeal from that decision. C argued, inter alia, that the judge failed properly to consider whether the Implementation Agreement was apt for incorporation into their contracts of employment. They argued that the relevant clauses were merely advisory in nature and accordingly not apt for incorporation.
HELD: The Implementation Agreement was apt for incorporation into the contracts of employment. All the clauses of the Green Book contemplated that there would be a re-grading exercise. The Implementation Agreement made it clear that if there was a re-grading policy, and that if the trade unions were properly consulted and an agreement reached, then the policy was to take effect. If an employee did suffer a loss of remuneration, the trade unions would have negotiated with S on the terms upon which those losses were to be agreed. The words of the Implementation Agreement were entirely apt as legally binding terms incorporated into Cs' contracts of employment.
Counsel for the defendant: Toby Kempster
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