Decision

Bargaining Unit Decision

Updated 25 October 2023

Applies to England, Scotland and Wales

Case Number: TUR1/1322/2023

27 September 2023

CENTRAL ARBITRATION COMMITTEE

TRADE UNION AND LABOUR RELATIONS (CONSOLIDATION) ACT 1992

SCHEDULE A1 - COLLECTIVE BARGAINING: RECOGNITION

DETERMINATION OF THE BARGAINING UNIT

The Parties:

Communication Workers Union

and

Maintel Europe Limited

1. Introduction

1)        The Communication Workers Union (the Union) submitted an application to the Central Arbitration Committee (the CAC) on 17 May 2023 that it should be recognised for collective bargaining by Maintel Europe Limited (the Employer) for a bargaining unit comprising the “Unify Multi-Vendor Team”.  The CAC gave both parties notice of receipt of the application on 17 May 2023.  The Employer submitted a response to the CAC dated 24 May 2023 which was copied to the Union.

2)        In accordance with section 263 of the Trade Union and Labour Relations (Consolidation) Act 1992 (the Act), the CAC Chair established a Panel to deal with the case.  The Panel consisted of Mr Stuart Robertson, Panel Chair, and, as Members, Mr Sean McIlveen (replaced by Mr Martin Kirke for this hearing) and Mr Paul Noon OBE.  The Case Manager appointed to support the Panel was Kaniza Bibi.

3)         By a decision dated 25 May 2023 the Panel accepted the Union’s application. The parties then entered a period of negotiation in an attempt to reach agreement on the appropriate bargaining unit. As no agreement was reached, the parties were invited to supply the Panel with, and to exchange, written submissions relating to the question of the determination of the appropriate bargaining unit, prior to a formal hearing to decide the issue.

4)         The Panel is required, by paragraph 19B(2) of Schedule A1 to the Act (the Schedule), to decide whether the proposed bargaining unit is appropriate and, if found not to be appropriate, to decide in accordance with paragraph 19B(3) a bargaining unit which is appropriate. Paragraphs 19B(2) states that, in making those decisions,  the Panel must take into account the need for the unit to be compatible with effective management, and the matters listed in paragraph 19B(3) so far as they do not conflict with that need.  The matters listed in paragraph 19B(3) are:

(1)   the views of the employer and the union;

(2)   existing national and local bargaining arrangements;

(3)   the desirability of avoiding small, fragmented bargaining units within an undertaking;

(4)    the characteristics of workers falling within the bargaining unit under consideration and of any other employees of the employer whom the CAC considers relevant; and

(5)    the location of workers.

5)         Paragraph 19B(4) states that in taking an employer’s views into account for the purpose of deciding whether the proposed bargaining unit is appropriate, the CAC must have regard to any view the employer has about any other bargaining unit that it considers would be appropriate.

2. Hearing

6)         A formal hearing to determine the appropriate bargaining unit was held on 19 September 2023 at Windsor House, Victoria Street, London SW1 and the names of those who attended the hearing are appended to this decision. The parties provided written submissions prior to the hearing together with supporting documentation and Mr Ellis for the Union and Ms Tether for the Employer made oral submissions and answered questions from the Panel at the hearing. The Panel is grateful for their assistance. In reaching its decision, the Panel has taken into account all the material supplied by the parties.

7)         At the outset of the hearing the Panel reminded the parties of the legal test it would apply in deciding the appropriateness of the bargaining unit.

3. Submissions from the Union

8)        Mr Ellis stated that the Union was seeking recognition for a discretely managed team of 19 Software Engineers within the Employer’s Support Services known as the “Unify Multi-Vendor Team”. 10 members of the team had transferred to the Employer from a previous employer at the beginning of March 2023, the remainder were existing employees. The distinguishing feature of the team was their specialism in the Unify software product. This was a unit which was appropriate and compatible with effective management.

9)         Mr Ellis said that discussions about voluntary recognition for the Unify team (which then consisted of the 10 Software Engineers who subsequently transferred to the Employer) had taken place with their previous employer, Thialis Limited, to the point where the terms of a draft recognition agreement had been agreed by 24 February 2023. However, as this was close to the proposed transfer date of the Unify work to the Employer, Thialis wished to consult with the Employer, in response to which the Employer indicated that it preferred to delay discussions about possible recognition until after the transfer.  Following the transfer, on 5 April 2023 the Union requested recognition by the Employer in respect of the business unit consisting of the Unify Multi-Vendor team. The Employer’s response was that it did not accept the request for voluntary recognition and was not willing to negotiate. Mr Ellis noted that the Employer did not propose any alternative bargaining unit.

10)       Mr Ellis contended that the proposed bargaining unit was compatible with effective management. It was a discrete team of Software Engineers, based on a specific skill set. He accepted that the Unify team was part of the Employer’s wider team of Software Engineers, and he had variously been told that the Employer employed 100 or 140 engineers. He accepted also that there was some overlap in the duties the engineers performed, in that the Unify team worked on other products and engineers from other teams worked on Unify, but this was insignificant when the focus of the team was its Unify specialisation, and the Unify team had the final say on any issues relating to the Unify product. He agreed that other teams dealt with high-security sites, and supported the Employer’s major customer, ATOS, but the factor which led the Unify team to undertake the majority of that work was its Unify specialisation. No other engineers had the skills to work on Unify without assistance. Mr Ellis also noted that the Employer’s training of the transferred-in Unify engineers had concentrated on further training on the Unify products and they had been refused training on other products, reinforcing their status as a specialist team.

11)       Mr Ellis noted that there were wide variations in the pay and terms and conditions of employment of the Software Engineers as a whole and within the Unify team. This was because many of the engineers had transferred in through service provision changes to which the Transfer of Employment (Protection of Employment) Regulations 2006 (TUPE) applied, and had remained, at least in part, on their previous terms of employment. The Union therefore believed that the Employer’s view that the proposed bargaining unit  would undermine “parity and equity” in respect of terms of employment was seriously misleading, when there were significant differences in terms and conditions among engineers, including basic pay rate.  The Union acknowledged that it appeared to be the ambition of the Employer to harmonise conditions, but engineers with TUPE protected terms could only be requested to opt in to new terms and collective bargaining with a recognised union could play a major part in such an exercise. Mr Ellis noted that the Employer’s recent exercise of harmonising call-out and overtime arrangements had been particularly relevant and material to the Unify team because of their higher rate of claims arising from their work, which indicated that harmonisation would raise particular issues of groups of engineers.

12)       Mr Ellis noted that the Unify team fell under the control of a single manager, working to specific customers and systems on which the rest of the engineering workforce was not trained. There was no ambiguity about who was included in the bargaining unit and who was not, and there was likely to be an ongoing need to tailor company policies to the specific needs of staff working on these products and systems.  There was a clear wish from the majority of staff in the unit, 13 out of 19 of whom were union members, for their terms and conditions to be the subject of collective bargaining.  Whilst there was an Employee Forum on which employees and management were represented, it was consultative only and did not bargain or negotiate. As there were no national or local bargaining arrangements in place, it was difficult to see how a creation of a bargaining unit could be described as fragmentation. 

13)       Finally, the Union contended that although the bargaining unit was small (currently 19 staff), the Union’s understanding was that the CAC had previously determined that there was no minimum size for a bargaining unit which otherwise met the factors which must be taken into account. The Union concluded that it was the clear wish of a majority of the employees working within the Unify Multi-Vendor team that the Union be recognised for collective bargaining on their behalf and there was no clear reason why such recognition would not be compatible with effective management.

4. Submissions from the Employer

14)        The Employer noted that the reasons given by the Union in its application for selecting the proposed bargaining unit were that the Unify Multi-Vendor team was managed separately and was the only team who carried out work on ATOS and Unify contracts; and they were the only engineers on call for ATOS and Unify products, as well as being the only team to carry out site visits on high security sites such as prisons and hospitals. The Employer did not accept that this was accurate. Ms Tether contended that the proposed bargaining unit was not appropriate or compatible with effective management. It consisted of 19 out of about 100 Software Engineers employed by the Employer in its Support Services function, essentially doing the same job. Although she was not prepared on behalf of the Employer to propose an alternative bargaining unit, she suggested at the outset of the hearing that if the Union was to be recognised by the Employer, the appropriate bargaining unit would appear to be the entire cohort of Software Support Engineers employed by it.

15)       In its written and Mr Tether’s oral submissions, the Employer provided background to is business. The Employer provides a wide range of technology services to its customers including managed communications and cloud-based services. It has a turnover of around £91 million and around 470 employees in the UK. It has customers in a wide range of areas including the public sector, retail, financial services, utility companies, charity, hospitality, and construction. It employs approximately 140 Software Engineers, organised into two teams – Support Services, with approximately 100 engineers, and Professional Services, with about 40 engineers.  The Support Services Engineers provide remote and field-based technical support for customers across a range of products based on integrated communications and network connectivity, to fulfil the Employer’s obligations to its customers under its service level agreements. The Professional Services Engineers deliver and deploy new solutions and technologies (remote and field-based) to customers in accordance with agreed high-level designs and projected scopes of work. Whilst engineers are primarily employed to work in either Support Services or Professional Services, depending on the work involved, the particular skills of the engineer, and customer demand, engineers may move between these teams.

16)       The 19 Software Engineers in the proposed bargaining unit fall within Support Services and specialise in the Unify software product line. They are line managed on a day-to-day basis by Mt John Bernard who is one of four Support Services Managers who report to the Head of Managed Services. Ms Tether explained that the Support Service Managers have immediate line management responsibility for the activities of their teams, but no role in setting pay or terms of employment which fall within the responsibility of the Employer’s Operating Board, made up of six senior executives.

17)       The Employer has grown over the years through acquisition and although there has been some direct recruitment, many of the engineers employed by it have transferred from previous employers through service provision changes, as a result of the Employer winning contracts to support its customers. This has meant that there are differences in the terms of employment of the Employer’s employees, including engineers, where it inherited employees and their previous terms and conditions. Ms Tether said that the Employer has 14 different sets of employment terms, including its own terms for directly-recruited workers and terms inherited following transfers in. This is replicated within the proposed bargaining unit, where terms of employment are different for the 10 members of the team who transferred in and the nine existing employees. The Employer has a long-term aim of harmonising terms of employment of engineers generally and had recently tackled the terms relating to out of hours provision and treatment of overtime which had been a particular concern for engineers.

18)       Simplifying matters somewhat, 10 of the engineers within the proposed bargaining unit transferred to the Employer on or around 1 March 2023 following a service provision change from their previous employer, Thialis. That service provision change concerned the provision of Unify services under a contract with a major customer of the Employer, called ATOS. They joined nine existing engineers employed by the Employer who had a similar skill set to those transferring in. The skill set was the knowledge and ability to service customers primarily using the Unify product range and this team of 19 engineers with expertise in the Unify product range, line managed by Mr Bernard, makes up the proposed bargaining unit. Following the transfer, the transferring employees were allocated a mentor to assist them in the way the Employer provides its services, involving more remote desk work, together with training to enable them to gain accreditation to Specialist or Expert level in the main Unify products, such accreditation being already held by the existing employees within the team. Ms Tether explained that this had been the focus for training the transferees in and was why they had not been offered training on the Employer’s other products.

19)       Ms Tether did not dispute that there had been negotiations between the Union and Thialis about possible recognition, but she did not accept these had reached the stage of a draft recognition agreement and the Employer had not received any such notification from Thialis.

20)       The Employer’s business model is that customers requiring support will contact a single point of contact known as a Service Desk. Once the Service Desk logs a call, an incident will be raised and based on the information provided on the initial contact, and the customer records, the incident will be directed automatically to the appropriately skilled team. These teams would primarily support the main products dealt with by the Employer such as Unify or Mitel or Avaya, and within the teams there was a system to determine who dealt with the issue. If, on investigation, it was found that the issue was not specific to the platform, the incident would be passed to another team. If support could be given remotely, the customer would be allocated an engineer with specialism in their product, which would mean for a Unify customer a specialist Unify engineer. If field-based support was needed, the Service Desk would usually allocate an engineer based nearest to the customer’s site, who would then have access to telephone advice from a product specialist. The employer calls this system of allocating work  “Smart Hands”.

21)    Ms Tether explained that the Employer had insufficient Unify work to occupy the engineers in the Unify team and referred to statistics from the Employer showing that the engineers spend only about 30% of their time of Unify products and the rest is spent on supporting other products (bundle pages 43-44). Only about 10% of calls for the Employer’s major Unify customer, ATOS, concerned Unify products (bundle page 48), amounting to about 55% of the Employer’s ATOS work. Whilst Unify engineers regularly visit high-security sites, they are not the only engineers who do so, and the Employer’s statistics show that the Unify team were responsible for just over 40% of such work (bundle page 46). Ms Tether also challenged the Union’s assertion that the Unify team were the only engineers on call for Unify customers; she told the hearing that the Employer has 16 engineers on call at any one time, including four engineers from the Unify team, and under the Smart Hands system other engineers may attend calls from Unify customers, although she accepted that the team will be the final  point of call for Unify issues.

22)       Although, therefore, Ms Tether accepted that the Unify team have specialist skills in Unify products, she maintained that the work of the Software Support Engineers was essentially the same, the teams being simply divided according to the primary skill sets of the engineers. The primary focus of the other Support Services teams was on servicing customers (including ATOS) in their use of other technology platforms – principally Mitel and Avaya (as opposed to Unify). Further, not all calls will need specialist knowledge. Support Services Engineers therefore worked on the same issues in dealing with an incident and the technology platform determined who deals with it. Engineers in all teams may deal with the same customers in the same way as all other teams, but with a focus on the different technology they individually specialise in. The Employer reiterated that the engineers in the proposed bargaining unit were not a unique grouping that should be isolated for consideration separately from the other Support Service Engineers.

23)       In its written submissions the Employer referred to paragraph 19B of the Schedule which sets out the factors that the CAC must take into account when deciding whether a bargaining unit was appropriate, as well as drawing the Panel’s attention to Kwik Fit (GB) Ltd v CAC [2002] ICR 1212, which held that the statutory test was set at “the comparatively modest level of appropriateness, rather than the optimum or best possible outcome”. The Employer also contended that following Kwik Fit,  “appropriate” meant suitable for collective bargaining and that the overriding requirement was for the proposed bargaining unit to be compatible with effective management, although the factors listed in subparagraph (3) may be taken into account in so far as they do not conflict with that need. Finally, although Ms Tether accepted that fragmentation was not an issue in this case where there were no other existing  bargaining arrangements (the Employee Forum is consultative only), a reminder had been given at paragraph 38 of the Court of Appeal’s decision in R (Lidl Limited) v Central Arbitration Committee [2017] ICR 1145 that whilst fragmentation under paragraph 18B(3)(c) was concerned only with fragmentation of collective bargaining, the appropriateness of a small, isolated bargaining unit within a greater whole of non-recognition might be incompatible with effective management.

24)       By way of overarching response, the Employer submitted that the proposed bargaining unit was too restrictive and not compatible with the structure of the Employer’s organisation or the way in which it operated. Any proposed bargaining unit should be representative of the Employer’s full engineering structure and consistent with the way in which the Employer managed its approach across all of its engineers.  Recognising the proposed bargaining unit for collective bargaining would not be compatible with effective management and would create a small, fragmented bargaining unit which would lead to undesirable difficulties in ensuring parity of treatment across all of the Employer’s engineering population. The Employer believed this would have a significant negative impact on its culture and ethos. All of the Employer’s engineers were considered together as a composite group in relation to their rates of pay and ways of working. The proposed bargaining unit was not organisationally separate from the other engineers. The employees in the proposed bargaining unit were a team which dealt primarily with a particular technology in providing solutions.

5. Considerations

25)       As stated at paragraphs 4 and 5 above, the Panel is required, by paragraph 19B(2) of the Schedule, to decide whether the proposed bargaining unit is appropriate and, if found not to be appropriate, to decide in accordance with paragraph 19B(3) a bargaining unit which is appropriate. Paragraph 19B(2) states that, in making those decisions,  the Panel must take into account the need for the unit to be compatible with effective management and the matters listed in paragraph 19B(3) so far as they do not conflict with that need.  The matters listed in paragraph 19B(3) are:

(1)   the views of the employer and the union;

(2)   existing national and local bargaining arrangements;

(3)   the desirability of avoiding small, fragmented bargaining units within an undertaking;

(4)    the characteristics of workers falling within the bargaining unit under consideration and of any other employees of the employer whom the CAC considers relevant; and

(5)    the location of workers.

26)       Paragraph 19B(4) states that in taking an employer’s views into account for the purpose of deciding whether the proposed bargaining unit is appropriate, the CAC must have regard to any view the employer has about any other bargaining unit that it considers would be appropriate. The Panel must also have regard to paragraph 171 of the Schedule which provides that “[i]n 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.”

27)       In terms of the factors in paragraph 18B(3), in considering the appropriateness of the proposed bargaining unit and its compatibility with effective management, the Panel has focused on the views of the Employer and the Union, and the characteristics of workers falling within the bargaining unit and the overall cadre of Software Support Engineers employed by the Employer. Neither party has suggested that the location of workers is significant. There are no existing national or local bargaining arrangements, the Employee Forum being consultative only. There is no question, as Mr Ellis and Ms Tether accepted, of fragmentation where there are no existing collective bargaining arrangements.

28)    The Panel’s first task was to examine the appropriateness of the Union’s proposed bargaining unit consisting of the “Unify Multi-Vendor Team”. The Panel has concluded that that unit is not compatible with effective management and is not appropriate in terms of paragraph 19B(2).

29)       The Panel has had firmly in mind that the threshold for appropriateness is relatively low. The question is whether the bargaining unit is appropriate as being suitable for collective bargaining. It need not be the best or the most appropriate bargaining unit and it is immaterial that the Panel may think there is a better bargaining unit.

30)    The Union’s case rests on its contention that the Unify team is a discrete, separate and distinct group of employees, appropriate as a unit for collective bargaining. But in the view of the Panel, that distinctiveness exists only in terms of the specialist knowledge and expertise of the Unify software products, and that has no significance in collective bargaining terms. On the facts, the Unify team is an integrated, constituent part of the Employer’s overall team of Software Support Engineers, undertaking essentially the same work, albeit with specialisation in particular products. As described above, there is interchangeability in the work the engineers perform, and separate line management exists only at an immediate line manager, reporting to a Head of Managed Services responsible for all the Software Support Engineers. Differences in the extent of security-critical work or engagement with a particular customer arose only from the extent to which particular customers used the Unify product, rather than from any differences in the work done or the characteristics of the employees in the team. The existence of the separate Unify team had no significance for pay or terms and conditions of employment.

31)       There was, in the Panel’s view, no proper or cogent justification for collective bargaining with a group distinguished only by product knowledge and otherwise forming part of a greater and coherent whole. That structure would be incompatible with the organisation Employer’s engineering function. It would create a small, isolated and artificial bargaining unit. There was a risk of tension between the Unify team and the other Software Support Engineers doing essentially the same work, arising from different methods of setting pay and conditions. Separate bargaining arrangements would be inconsistent with the Employer’s overall aim of harmonising its disparate range of employment terms. In the Panel’s view, creating a separate bargaining unit in these circumstances would not be compatible with effective management within the Employer’s support engineering function.

32)       Having decided that the Union’s proposed bargaining unit was not appropriate, the Panel then considered what bargaining unit would be appropriate. In doing so, the Panel had regard to the factors in paragraphs 18B(2) and (3), to overall compatibility with effective management, and as enjoined by paragraph 18B(4), to any views expressed by the Employer.

33)       It was striking how reluctant the Employer was to propose an alternative bargaining unit, notwithstanding that the Schedule requires the Panel to determine such a unit if, as has happened, it decides the Union’s proposed unit is not appropriate. Ms Tether’s initial position was that whilst she would not propose an alternative, the most appropriate bargaining unit would seem to be the whole team of Software Engineers. However, when asked again at the conclusion of her submissions, and after seeking instructions, Ms Tether suggested that as the Union’s primary focus had been on the 10 engineers who had transferred from Thialis, that group might be an appropriate bargaining unit. For the Union, Mr Ellis said that he would need to consult with members, which in the Panel’s view he should have done ahead of the hearing, but when pressed, he responded that he could not understand why the Employer believed the 10 engineers would be an appropriate unit when  the 19 was not. However, he concluded that if the Panel decided the 10 engineers was the appropriate bargaining unit, the Union would accept that.

34)       Agreeing with the Union’s position, the Panel found it difficult to understand the rationale behind the Employer’s contention, which was inconsistent with the Employer’s primary case, which the Panel has largely accepted,  about the artificiality of separating out the Unify team from the rest of the Employer’s Software Support Engineers. Also, the Panel noted the lack of any significant difference in the work done by the transferred-in and existing members of the Unify team. The Panel is satisfied that the 10 engineers would not be an appropriate bargaining unit..

35)     The Panel concludes that the appropriate bargaining unit is “All Software Engineers employed by Maintel Europe Limited in its Support Services function”. In collective bargaining terms, this is an identifiable and coherent group of employees performing similar duties for the Employer’s customers and reporting via immediate line managers into a single senior manager. Collective bargaining with this unit would be, in the Panel’s view, compatible with effective management. There is no rationale for sub-dividing this group of employees.

36)       The Panel has considered whether the bargaining unit should include the Professional Support Engineers. The Panel did not hear detailed evidence about the specific roles and responsibilities and characteristics of the Professional Support Engineers, but the evidence it did hear indicated that their function focussed on development and implementation of new products and projects which appeared to be separate and distinct from the work done by the Software Support Engineers, even if there was some limited interchangeability between the teams. On this basis, the Panel determined that the appropriate bargaining unit should consist only of engineers in Support Services.

6. Decision

37)       The bargaining unit proposed by the Union of “The Unify Multi-Vendor Team “is not an appropriate bargaining unit for collective bargaining purposes. The appropriate bargaining unit in this application is “All Software Engineers employed by Maintel Europe Limited in its Support Services function”.

38)       As the appropriate bargaining unit differs from the proposed bargaining unit, the Panel will now proceed under paragraph 20(2) of the Schedule to decide if the application is invalid within the terms of paragraphs 43 to 50 of the Schedule.

Panel

Mr Stuart Robertson, Panel Chair

Mr Martin Kirke

Mr Paul Noon OBE

27 September 2023

7. Appendix

Names of those who attended the hearing

For the Union

Ray Ellis                                 CWU Head of Recruitment, Organising & Membership Growth 

Sara Barnicoat                        CWU Central Organiser                                

Michael Garfield                    Engineer in the Unify Multi-Vendor team   

Darren Johnson                      Engineer in the Unify Multi-Vendor team

For the Employer

Rebecca Hughes                     Maintel Chief People Officer

Gillian Bailey                         Maintel Chief Operating Officer

Richard Davies                       Maintel Head of Managed Services

Ms Melanie Tether                 Counsel