Decision
Updated 25 March 2024
Applies to England, Scotland and Wales
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Case Number: DI/05/2023
25 March 2024
CENTRAL ARBITRATION COMMITTEE
TRADE UNION AND LABOUR RELATIONS (CONSOLIDATION) ACT 1992
SECTION 183 – DISCLOSURE OF INFORMATION
The Parties:
British Airline Pilots Association (BALPA)
and
easyJet Airline Company Limited
1. Introduction
1) British Airline Pilots Association (BALPA) (the Union) submitted a complaint to the CAC dated 9 November 2023 pursuant to section 183 of the Trade Union and Labour Relations (Consolidation) Act 1992 (the Act). The complaint related to an alleged failure by easyJet Airline Company Limited (the Employer) to disclose information for the purposes of collective bargaining. The Employer submitted a response to the Union’s complaint dated 20 November 2023 which was copied to the Union.
2) In accordance with section 263 of the Act, the CAC Chair established a Panel to consider the complaint. The Panel consisted of Mrs Lisa Gettins, Panel Chair, and, as Members, Mr Michael Clancy, and Mr Richard Fulham. The Case Manager appointed to support the Panel was Joanne Curtis.
2. Background
3) By way of an agreement dated 8 March 2002 the Employer recognises the Union as having sole recognition rights for all UK Pilots actively engaged in commercial flying. Collective bargaining rights are afforded to the Union and cover UK Pilots pay, hours and holidays with the exception of those flight deck management listed as follows and the management payments associated with those appointments: Chief Pilot, Flight Operations Manager, Base Captains, Head of Training and Senior Training Captain(s).
3. The Complaint
4) The complaint was made in respect of “easyJet Airline Pilots based and employed in the UK.” The Union stated that it had requested information for collective bargaining purposes on 26 September 2023. In its complaint, the Union stated that it had requested, the following information for collective bargaining purposes: “Contribution (EBITDA) and PBT, by quarter, for the UK operation only, both as a whole and broken down by base for FY21-22 and FY22-23 (Q4 and full year as soon as released to stock market). Costs of ICC, MOC etc to be allocated pro rata if included in the calculations. Paid leave allocation per month vs FTE for that month. Crew food costs.”
5) When asked to give details of the collective bargaining purpose for which the Union requested the information, the Union stated that it had requested the information in order to fully participate in collective bargaining of the 2024 pay settlement for UK based airline pilots.
6) When asked to give details as to how it had been materially impeded in collective bargaining by not receiving the information the Union stated that the information requested would influence the formulation and presentation of the Union’s pay claim. The Union said that in order to assess the Employer’s “available funds” and the affordability of a pay claim for UK pilots it needed to know what proportion of easyJet’s profits originated in the UK, as that was the logical source of the funding for any pay increase. The Union said that if it only looked at the “group level performance” this may over or understate the contribution of UK workers. In addition, the Union said that, in a recent survey several members had raised the issue of incorporating a local regional weighting into pay scales. The Union said that to justify this it would need to be able to demonstrate that the specific region generated proportionally more EBITDA and PBT than the rest of the UK. The Union said that it could only assess this if it had a breakdown of “UK financial performance at the level of Operating Bases (Airports at which our members are permanently based along with easyJet’s UK registered aircraft).” The Union went on to say that it wished to consider including a request for increased leave allocation and that the value of leave to members was considerably influenced by when that leave was offered. “For example, a week of leave in the school summer holidays is considered significantly more valuable by members than a week in November. In order to assess when any extra leave is likely to be allocated, we need to understand how the current allocation is distributed through the year. We also have recognised collective bargaining rights over holidays in easyJet, the timing of those holidays clearly is part of that bargaining and to bargain effectively we need to know when leave is being delivered.” The Union concluded by saying that crew food was paid for by members under a salary sacrifice arrangement, and therefore as part of the collective bargaining process the Union wished to satisfy themselves that the pay sacrificed to fund the provision of crew food was all being used for that purpose alone.
7) When asked to give details about the way it considered it would be in accordance with good industrial relations practice for the Employer to disclose the information, the Union stated that all three pieces of information should be disclosed for the following reasons:
“1) It is good industrial relations practice for an employer to be open and honest with the workforce regarding the financial situation of the company and how they are contributing to the success or otherwise of the organisation. In a company the size of easyJet working across many bases and several countries with significantly different cost bases and profit margins it is impossible to deduce the UK contribution from the publicly released aggregated figures but we know that the company already produce Profit and Loss data by base (and also route) so this can be shared without causing any significant extra work.
2) The purpose of leave is partly to ensure the long-term health and wellbeing of employees by allowing them a break from work to recuperate, spend time with their friends and family, and to relax. To achieve these goals the distribution of leave through the year is a significant factor and it is good industrial relations practice for the employer to be willing to demonstrate that the distribution pattern delivered allows these goals to be achieved.
3) It is good industrial relations practice for an employer to abide by both the letter and the spirit of previous agreements. In a previous pay agreement, our members agreed to sacrifice a specified amount of salary to fund crew food, the implication being that that was the amount needed to pay for crew food for the UK pilots and that all the money sacrificed would be used for that purpose. The employer should, as a matter of good practice, be willing to demonstrate that it is not misapplying these funds for another purpose.”
4. Overview of Employers response to the Complaint
8) In its response dated 20 November 2023 the Employer confirmed that the Union was recognised for collective bargaining for the workers described in the Union’s application and it accepted that the Union had requested information but did not accept that it had all been requested for the purposes of collective bargaining.
9) The Employer stated that it did refuse to disclose the information as requested by the Union on its application form.
Item 1 (Financial data)
The Employer said that this information had not been disclosed because, whether in the form that it had been requested or more generally, it was not required for the purposes of collective bargaining. The Employer said that the Union had already indicated that it would accept the “base level data” being provided in a slightly redacted form so that it could see the “relative contributions and profitability rather than the absolute ones.” The Employer said that whilst it did not consider this information was required for the purposes of collective bargaining, in order to maintain a positive relationship with the Union it had already offered to provide financial data based on all routes ‘touching’ the UK as this more accurately represented the profitability for the UK network.
Item 2 (Paid leave)
The Employer stated that this information had not been disclosed because it was not required for the purposes of collective bargaining. The Employer said that if the Union wished to request that its members’ annual leave entitlement was increased then the Union could formulate a request for such an increase without the information. The Employer said that the Union had expressed that that the information was being requested in order for the Employer “to demonstrate that the distribution pattern delivered [of annual leave] allowed these goals [of long-term health and wellbeing] to be delivered”, as opposed to for the purposes of collective bargaining.
Item 3 (Crew food costs)
The Employer said that this information had not been disclosed because it had not been requested for the purposes of collective bargaining. Instead, the Employer said the Union’s position was that the information was being requested in order for the Union to able to satisfy its members that the pay “sacrificed to fund the provision of crew food is all being used for that purpose alone” and to demonstrate that the Employer was not “misapplying these funds for another purpose”.
10) In response to the argument that the Union was materially impeded in collective bargaining by not receiving the information, the Employer said that the Union had not contended that it had to date been materially impeded in collective bargaining. Instead, the Union had suggested that it would in future be impeded. Further, the Employer said the Union had been able to conduct collective bargaining for many years without the information. The Employer said that the Union itself had stated that the information was being requested as part of a verification exercise as opposed to for the purposes of collective bargaining. In respect of the financial data request the Employer said that it did not believe the Union would be materially impeded in conducting collective bargaining without it on the basis that profitability by UK base did not inform the affordability of the UK pay deal, as the Union had suggested. The Employer explained “whilst profitability is something we hope to achieve year on year, it is by no means guaranteed. Any pay mandate will be considered based on a wide range of reward factors (for example benchmarking against competitors, market conditions, attrition/retention rates, inflation, cost of living, etc) and it is these elements that feed into whether any local regional weighting is appropriate.”
11) When asked for a response on the question of whether it would be in accordance with good industrial relations practice to disclose the information the Employer said that it agreed that it was in accordance with good industrial relations practice to be open and honest with its workforce which included the Union however, “section 181(2)(b) expressly provides that, in order for the CAC to be entitled to order its disclosure, information must be such that it would be in accordance with good industrial relations practice that it be disclosed for the purposes of collective bargaining. As such, and irrespective of wider good industrial relations practice considerations that are outside of the jurisdiction of the CAC, the disclosure of information to demonstrate that worthy goals are being achieved or that funds are not being misapplied does not amount to information being disclosed for the purposes of collective bargaining”. In concluding the Employer asked the CAC whether an informal meeting could take place with the Panel Chair to try and resolve or narrow the scope of the Complaint without the need for a formal hearing. The Employer said that this would be better for the long term relationship of the parties.
5. Union’s comments on the Employer’s response to the Complaint
12) Commenting on the Employer’s response, the Union, in a letter dated 1 December 2023, stated that the question for the CAC was whether the Union would be impeded in conducting collective bargaining. The Union said “the enquiry must be directed to the impact on the union’s bargaining role (as opposed to impact on any prospective bargain). The concept of impediment relates not to the outcome of negotiations, but to the preparation of arguments within those negotiations.” In terms of the financial data the Union said that it would be impeded to a material extent in carrying out collective bargaining if this material was not provided in that the Union and its members considered the financial performance of the UK operation as a significant factor in deciding a pay agreement that was fair. The Union said that it wished to have the opportunity to pursue this line of negotiation in the course of collective bargaining and would not be able to prepare or substantiate these arguments without access to the information. The Union said that in previous pay rounds the Employer had relied on poor profitability as a reason for rejecting the Union’s pay claim. The Union said that should this be raised by the Employer again it needed the information in order to prepare arguments and properly participate in collective bargaining. The Union accepted that both parties would need to consider a wide range of factors when considering pay but that did not mean that the non-provision of the information requested was not a material impediment to the Union. The Union went on to say that even if the Employer’s position is that it does not consider the profitability of UK bases relevant for the purposes of the UK pay deal, that does not mean that the Union is not materially impeded in conducting collective bargaining by the non-provision of this information. The Union said that it considered the financial performance of the UK operation to be a significant factor in deciding a fair pay agreement and wished to have the opportunity to make reasoned and evidenced arguments on this point by reference to the relevant material. The Union said that the proper focus of the CAC was on the impediment to the Union’s bargaining role and not on the Employer’s decision-making processes in negotiations.
13) The Union went on to say that the Employer “suggests that BALPA’s own position is that it does not require the information in the form that it was originally requested as it has already indicated that it would accept base level data being provided in a slightly redacted form so we can see the relative contributions and profitability rather than absolute ones. There was no concession on the part of BALPA that the information is not required or that its non-provision does not constitute a material impediment to BALPA in carrying on collective bargaining. BALPA said to easyJet that BALPA was prepared to accept information in a slightly redacted form in an effort to provide reassurance in respect of any concerns easyJet might have about confidentiality. If the information was disclosed in this slightly redacted form (whereby the relative contribution of each base was provided as opposed to the actual contribution of each base) the information provided was less confidential if accidentally disclosed by either party. It is important to stress this would not result in BALPA having any less information available to it for the purposes of carrying on collective bargaining. BALPA envisaged the total profit being disclosed separately meaning BALPA would still be in a position to derive absolute numbers in terms of the profit generated by each base.”
14) The Union said that the Employer had suggested that the Union would not be materially impacted by the non-provision of the information as the Union had been able to conduct negotiations without this information in previous years. The Union said that “this is not a profitable line of argument for easyJet. The CAC is unlikely to be in a position to consider whether in previous negotiation rounds the non-provision of this material was a material impediment to BALPA’s carrying on collective bargaining. Such an exercise would necessarily involve analysis of previous lines of argument pursued by BALPA in previous negotiations. In any case BALPA considers that the recent introduction of easyJet Holiday, in November 2019 within the company structure has shifted the generation of profit towards the UK operation meaning that provision of this material is particularly material for the purposes of BALPA conducting the current round of negotiations.”
15) The Union said that it noted the Employer’s offer to provide financial data on all routes ‘touching’ the UK as this more accurately represented profitability for the UK network. The Union said that it was recognised for the purposes of collective bargaining on behalf of the Employer’s UK based pilots, and that these pilots were based in the UK and operated UK “G” registered aircraft under the UK operators’ certificate. The Union said that it was seeking the information to ascertain what proportion of the “plc’s profits” were produced by Union members. The Union went on to say that the information which the Employer had offered to supply would include contributions and costs associated with aircraft and crews not based in the UK making it impossible to break out the profit associated with the UK based crew and aircraft.
16) The Union went on to say “in their response easyJet suggests that BALPA can formulate a request for increased annual leave without the information sought. This does not address the question which the CAC will consider. The question is whether BALPA will be impeded in its role carrying on collective bargaining. BALPA would wish to consider this information and formulate arguments as to the value of leave as set out in the section 183 application. Non-provision of this information (which is of course available to easyJet) will affect BALPA’s ability to conduct negotiations on behalf of its members. BALPA negotiates with easyJet in relation to holidays (annual leave). In negotiating on annual leave (and adopting particular bargaining positions) BALPA will necessarily have in mind that the purpose of annual leave is to ensure the long-term health and well-being of workers by allowing them a break from work to recuperate, spend time with their family and friends, and relax.”
17) The Union said that it requested information on crew food for the purposes of collective bargaining. It said that crew food was paid for by way of a salary sacrifice agreement and that this had formed the subject of previous collective agreements and therefore informed ongoing collective negotiations. The Union submitted “if, as BALPA suspects. the deduction from wages agreed for the provision of crew food is not being applied for that purpose then, on consideration, BALPA would wish to either get an uplift of salary to compensate for this or an improvement to the quality of crew food financed by the underspend. BALPA will be impeded in carrying on collective bargaining on these issues without access to this information.” In conclusion the Union said that it was seeking relevant information for the purposes of collective bargaining. It said that good industrial relations practice required an Employer to be as open and helpful as possible to a Union and that it would be in accordance with good industrial relations practice for the Employer to disclose this information to the Union for the purposes of collective bargaining.
6. Informal meeting
18) On 4 December 2023 the parties were informed that the usual practice of the CAC, subject to the agreement of the parties, was to hold an informal meeting to clarify the outstanding issues and to establish whether the matter could be resolved by conciliation before the matter was set down for a formal hearing. The parties were asked whether they would be prepared to attend such a meeting with the Panel Chair. The parties agreed to this, and an informal meeting took place using zoom on 17 January 2024. At the meeting the parties were unable to agree however the terminology and description of the information used by the Union in its application and in the Employer’s subsequent response was clarified.
19) At the end of the informal meeting the parties were asked to confirm within 48 hours of receipt of Acas availability whether they wished to take advantage of conciliation prior to a formal hearing. On 19 January 2024 the Union confirmed that they would be happy to meet with Acas and were available on 30 January 2024. On 19 January 2024 the Employer confirmed that it did not wish to utilise the services of Acas and instead wished to proceed to a hearing before the full Panel.
7. The hearing
20) A formal hearing took place in Bedford on 27 February 2024. The names of those who attended the hearing are appended to this decision. The Union provided a submission prior to the hearing together with supporting documents; the Employer provided a statement of its case together with a supporting evidence bundle. These documents were exchanged, and submitted to the Panel, in advance of the hearing. The Panel confirmed at the outset of the hearing that all submitted documents had been read by them. The Panel are grateful to the parties for their responses to questions from the Panel.
8. Summary of the submissions made by the Union
21) The Union’s submissions focused on the test of material impediment, setting out why the Union would be impeded in conducting collective bargaining if the information was not disclosed. The Union reminded the Panel that the concept of impediment relates not just to the outcome of negotiations but also to the preparation for those negotiations. The Panel noted the Union’s views regarding the percentage of overall profitability driven from the UK. The Union confirmed that their request was for Contribution (EBITDA) and PBT, by quarter, for the UK operation set out both as a whole, and broken down by base, for the years 2021-22 and 2022-23. The majority of the submissions focused on the financial data. The Union confirmed that the information sought was not publicly available and that the changing nature of the business over the preceding three to five years necessitated a review of this data now. The Union also submitted to the Panel a note on the relevant law.
9. Summary of the submissions made by the Employer
22) The Employer’s submissions focused on why they did not consider the information to be disclosable. In relation to the request for financial information, the Employer drew the Panel’s attention to the contradiction in the Union’s request and correspondence around redacted and unredacted data, submitting that there was a concession by the Union that the information in it’s fullest form now being requested was not necessary. The Employer stated that the Union had not met the test to demonstrate that they would be impeded if this information were not disclosed confirmed that they did have the information being requested. The Employer also set out the basis on which they would formulate their pay negotiation which would consider factors outside of pure profitability of the business and would include market benchmarking and other matters, rendering the level of detail required by the Union without purpose in the collective bargaining process. Regarding paid leave the Employer submitted that the Union did not require this for the purposes of collective bargaining, referencing the correspondence from the Union to confirm this. Regarding crew food the Employer confirmed that it did not operate a formal salary sacrifice arrangement and provided helpful answers to the Panel’s request as to arrangements for the provision of crew food. The Employer confirmed they were not seeking to rely on the restrictions to the general duty set out in section 182.
10. The Relevant Law
23) The legislative provisions can be found in sections 181 to 184 of the Trade Union and Labour Relations (Consolidation) Act 1992 which the Panel has reviewed in conjunction with the Acas Code of Practice.
Section 181 of the Act provides that:
(1) An employer who recognises an independent trade union shall, for the purposes of all stages of collective bargaining about matters, and in relation to descriptions of workers, in respect of which the union is recognised by him, disclose to representatives of the union, on request, the information required by this section.
In this section and sections 182 to 185 “representative”, in relation to a trade union, means an official or other person authorised by the union to carry on such collective bargaining.
(2) The information to be disclosed is all information relating to the employer’s undertaking (including information relating to use of agency workers in that undertaking) which is in his possession, or that of an associated employer, and is information –
(a) without which the trade union representatives would be to a material extent impeded in carrying on collective bargaining with him, and
(b) which it would be in accordance with good industrial relations practice that he should disclose to them for the purposes of collective bargaining.
(3) A request by trade union representatives for information under this section shall, if the employer so requests, be in writing or be confirmed in writing.
(4) In determining what would be in accordance with good industrial relations practice, regard shall be had to the relevant provisions of any Code of Practice issued by ACAS, but not so as to exclude any other evidence of what that practice is.
(5) Information which an employer is required by virtue of this section to disclose to trade union representatives shall, if they so request, be disclosed or confirmed in writing.
24) Section 182(1) sets out circumstances wherein an employer is not required to disclose information. The Panel noted that none of the defences listed in Section 182(1) have been put forward by the Employer in this case. The Employer did touch upon the issue of commercial sensitivity of data in both its written and oral submissions but did not seek to suggest that this amounted to one of the defences listed in Section 182(1). The arguments put forward by the Employer for non-disclosure were based on whether the Union could be said to be materially impeded in carrying out collective bargaining under Section 181(2)(a)
25) Section 182(2) then sets out further restrictions on the employer’s duty to disclose. It provides that in performing its duty under section 181 an employer is not required -
(a) to produce, or allow inspection of, any document (other than a document prepared for the purpose of conveying or confirming the information) or to make a copy of or extracts from any document, or
(b) to compile or assemble any information where the compilation or assembly would involve an amount of work or expenditure out of reasonable proportion to the value of the information in the conduct of collective bargaining.
The Panel noted that the Employer did not seek to argue that the information sought would require a disproportionate amount of time, effort and resources to provide.
26) Section 183 is the enabling provision that allows a complaint to be made to the CAC in circumstances whereby an employer has either failed to disclose to representatives of the union information which it was required to disclose under section 181, or it failed to confirm such information in writing. This section then goes on to set out how the CAC should dispose of a complaint brought under these provisions.
11. Considerations
27) The Panel’s decision on this complaint has been taken after a full and detailed consideration of the views of both parties as expressed in their written submissions and amplified at the hearing. The Panel records its gratitude for the forbearance shown by the parties in answering the many questions put during the course of the hearing and which greatly assisted our understanding of their respective positions on the matters that are subject to this complaint.
28) The question for the Panel to address is whether, given the circumstances of this case, the Employer is under the duty set out in section 181 to disclose the information requested by the Union. If the Panel is to find in the Union’s favour and uphold its complaint, it must be satisfied that the conditions set out in section 181 are satisfied.
29) Turning now to the tests under section 181(2), for the Employer to be under a duty to disclose information to the Union, it has to be information without which the Union would be to a material extent impeded in carrying out collective bargaining with the Employer. If the Panel is satisfied that this is the case, it will then move on to consider the second limb under section 181(2) and whether it would be in accordance with good industrial relations practice that the Employer should disclose the information for the purposes of collective bargaining. To assist the Panel with its determination as to what would be in accordance with good industrial relations practice, the Act states that the Panel should have regard to the relevant provisions of any Code of Practice issued by Acas, but not so as to exclude any other evidence of what that practice is. The Panel reminded themselves of the provisions of the Code of Practice and particularly paragraph 9 of that Code “…particularly if the information would influence the formulation, presentation or pursuance of a claim…” and paragraph 11(v).
30) Clearly, the purpose of the disclosure provisions is to encourage the flow of information with the aim that it improves a Union’s knowledge of the relevant undertaking and therefore its ability to take part in the process of collective bargaining with an employer. The information concerned must have some relevance to whichever element of collective bargaining happens to be the subject of the parties’ negotiations. The test in section 181(2)(a) refers to information without which the trade union would be impeded. In other words, does the absence of this information hinder the Union’s efforts to take part in collective bargaining with the Employer.
31) The Panel’s conclusions relating to each of the items of information requested by the Union are as follows:
Contribution (EBITDA) and PBT, by quarter, for the UK operation only, both as a whole and broken down by base for FY21-22 and FY22-23 (Q4 and full year as soon as released to stock market). Costs of ICC, MOC etc to be allocated pro rata if included in the calculations.
32) During the informal meeting it was unclear what information the Union was actually seeking. The Union confirmed that it was the data setting out the profitability of the UK aircraft operated by “the people they represent”, which included a breakdown by base. At the hearing on 27 February 2024, it was apparent to the Panel that the Union was not seeking to confine the request to “data broken down by base” but to be two requests in one namely profitability level overall and broken down by base, in effect relying on paragraph 4 of their original application. The Panel understood the basis of the request for financial information relating to the UK operation overall of the Employer and considers it both necessary for the formulation, presentation and pursuance of the Union’s claim and recognised as such by the ACAS Code of Practice. The Panel also noted that, while other factors would be taken into account, the Union’s submission that the Employer had relied on profitability levels in previous pay rounds as a basis of rejecting the Union’s pay claim was not disputed by the Employer. The Panel considers that in this case the Union would be impeded to a material extent by non-disclosure of this information and also that it is in accordance with good industrial relations practice for the Employer to disclose this to the Union. On the topic of the request for base by base breakdown however, the Panel were not satisfied that the request for financial information to be broken down by base was disclosable or that the union would in any way be impeded in the collective bargaining process by having overall profitability data only. This aspect of the Union’s claim therefore succeeds in part, but the request for data to be broken down by base is not successful.
Paid leave allocation per month vs FTE for that month.
33) The Union clarified the nature of this request at the Informal Hearing, namely “Leave lines available for the holiday year at the point of holiday bidding, shown by month”. The Panel were not persuaded that this information was being sought for the purposes of collective bargaining or that, even if it were, that the Union would be impeded by the non-disclosure of this information. This aspect of the Union’s claim is not successful.
Crew food costs
34) The Union clarified the nature of this request at the Informal Hearing, namely “Spend per person on crew food”. The Panel were not persuaded that this information was being sought for the purposes of collective bargaining and/or that it was within the collective bargaining rights afforded to BALPA set out in the recognition agreement of 8th March 2002.
12. Decision
35) The Employer should disclose the information as detailed in paragraph 32, namely Contribution (EBITDA) and PBT, by quarter, for the UK operation as a whole only to the Union within four weeks of this declaration.
Panel
Mrs Lisa Gettins, Panel Chair
Mr Michael Clancy
Mr Richard Fulham
25 March 2024
APPENDIX
Names of those who attended the hearing.
On behalf of the Trade Union
Nick Charnley Company Council Chairman
Graeme Meikle Company Council Member
Michelle Brierley BALPA National Officer
Madeline Stanley Counsel
On behalf of the Employer
Tom Swarbrick Senior Labour and Employment Lawyer
Jamie Fraser Director of Industrial Relations
Oliver Schmitz Ops People Strategy Business Partner