Collective Agreements

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Quick Facts

20th August 2018

  • It is unusual for a collective agreement to be a legally enforceable contract between a trade union and an employer. Such agreements are, generally, regarded as “binding in honour”. What is a Collective Agreement

  • The terms of a collective agreement dealing with an employee’s terms and conditions of employment (eg, pay) will be incorporated into his or her contract, and therefore, a unilateral change of such a term will be unlawful. The Effect on Individual Employment Contracts

  • Once a term of a collective agreement is incorporated into the contract of employment, the term is unaffected by the termination of the collective agreement. The Effect on Individual Employment Contracts

  • The terms of a collective agreement dealing with the terms that govern the relationship between the employer and the trade union (eg, a dispute procedure) will not be incorporated in the contract of employment. The Effect on Individual Employment Contracts

  • The terms of a collective agreement may be incorporated into an employment contract either expressly or implicitly. Express Incorporation

  • A term of a collective agreement may amount to unlawful discrimination. Collective Agreements and Discrimination

  • Where a TUPE transfer has taken place, the new employer is legally obliged to comply with the incorporated terms of the transferred employees’ contracts regardless of whether or not the agreement has been terminated. However, under a TUPE transfer, the new employer is not bound by ‘dynamic’ clauses in contracts of employment referring to collective agreements negotiated after the transfer where the transferee cannot participate in the negotiations.Collective Agreements and TUPE Transfers

Summary

In many industries, wage rates and employment terms are established by collective agreements negotiated by trade unions and employers (or employer associations). In the UK, collective agreements are generally presumed to be legally unenforceable, binding the parties “in honour only”. This topic looks at the legal definition of a collective agreement and how the terms of such an agreement may be incorporated into individual employment contracts. It also considers the effect of discrimination and TUPE legislation on collective agreements.

The employment terms and conditions for police officers are largely determined nationally under the auspices of Police Regulations and Home Secretary Determinations. Police forces are required to follow such terms and conditions. These can be supplemented at local force level by specific agreements. Certain national employment terms necessitate local force agreements reached through local negotiations and consultations.

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Case Reports

Hein v Albert Holzkamm GmBh – Holiday pay

Ruling confirms that collective agreements cannot be used to reduce minimum holiday pay

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University College Union v University of Stirling - Collective consultation: fixed-term contracts

Application of collective consultation requirements to employees on fixed-term contracts.

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Alemo-Herron v Parkwood Leisure - Tupe transfers

The employees in this case had contractual terms governed by collective agreements, negotiated at a national level. The employees transferred under the Tupe regulations to a private sector employer. A new national collective agreement increased rates of pay. The new employer refused to implement the new pay rates as it could not join in the negotiations. The employees claimed they were entitled to the pay increase.

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Kenny v Minister for Justice - Equal pay and collective agreements

Can a collective agreement justify disparities in pay?

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Malone v British Airways - Collective agreement: incorporation

Collective agreement not incorporated into individuals’ contracts.

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Worrall v Wilmott Dixon Partnership - Tupe transfer: collective agreements

Terms from a collective agreement were not incorporated into employee’s contract and so did not transfer.

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In many industries, wage rates and employment terms are established by collective agreements negotiated by trade unions and employers (or employer associations). In the UK, collective agreements are generally presumed to be legally unenforceable, binding the parties “in honour only”. This topic looks at the legal definition of a collective agreement and how the terms of such an agreement may be incorporated into individual employment contracts. It also considers the effect of discrimination and TUPE legislation on collective agreements.

Quick Facts

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