Decision

Bargaining Unit Decision

Updated 17 December 2021

Applies to England, Scotland and Wales

Case Number: TUR1/1217/2021

14 July 2021

CENTRAL ARBITRATION COMMITTEE

TRADE UNION AND LABOUR RELATIONS (CONSOLIDATION) ACT 1992

SCHEDULE A1 - COLLECTIVE BARGAINING: RECOGNITION DETERMINATION OF THE BARGAINING UNIT

The Parties:

Unite the Union

And

DHL Parcel UK Limited

1. Introduction

1) Unite the Union (the Union) submitted an application to the Central Arbitration Committee (the CAC) dated 16 April 2021 that it should be recognised for collective bargaining purposes by DHL Parcel UK Limited (the Employer) in respect of a bargaining unit comprising “Linehaul Drivers based at Ryton in Coventry.” The location of the bargaining unit was given as “DHL Parcel UK Limited, Hillman Way, Ryton-on-Dunsmore, Coventry, CV8 3ED.” The application was received by the CAC on 16 April 2021 and the CAC gave both parties notice of receipt of the application by a letter of the same date. The Employer submitted a response to the CAC dated 23 April 2021 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 Chairman established a Panel to deal with the case. The Panel consisted of Mr Tariq Sadiq, Panel Chair, and, as Members, Ms Stephanie Marston and Mr Robert Lummis. The Case Manager appointed to support the Panel was Kate Norgate.

3) By a decision dated 24 May 2021 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. A virtual hearing was held on 2 July 2021 and the names of those who attended the hearing are appended to this decision.

4) Both parties provided helpful written submissions prior to the hearing together with supporting documentation. At the hearing the Panel heard oral submissions from Dorota Dudek (Senior Organiser, West Midlands) and Georgina Hirsch (Counsel for the Employer). The Panel would also like to thank Sarah Maddox (Vice President – HR at DHL Parcel UK Limited) and Scott Laird (Vice President Operations at DHL Parcels UK Limited) for answering the Panel’s many questions during the hearing. The information they provided was particularly helpful to the Panel.

2. Issues for consideration by the Panel

5) The Panel is required, by paragraph 19(2) of Schedule A1 to the Act (the Schedule), to decide whether the Union’s proposed bargaining unit is appropriate and, if found not to be appropriate, to decide in accordance with paragraph 19(3) a bargaining unit which is appropriate. Paragraph 19B(1) and (2) state 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) of the Schedule so far as they do not conflict with that need. The matters listed in paragraph 19B(3) are: the views of the employer and the union; existing national and local bargaining arrangements; the desirability of avoiding small fragmented bargaining units within an undertaking; 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 the location of workers. 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 take into account 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.”

6) The views of each party relating to the provisions as set out in paragraph 5 above as expressed to the Panel in their written and oral submissions are summarised below.

3. Summary of the submissions made by the Union

7) The Union submitted that together with its members it had selected its proposed bargaining unit because it consisted of a coherent and distinctive group of workers that was compatible with effective management for the purposes of collective bargaining. The workers in the proposed bargaining unit shared the same terms and conditions. They were hourly paid HGV drivers, with no management responsibilities. Those workers were involved in the movement of the product only and they were all based at one location, the Distribution centre in Ryton. They were not covered by any existing national and local bargaining arrangements. The Ryton depot was the main centralised consolidation hub and all of the other 43 sites were satellite sites. Terms and conditions across the sites varied and therefore a bargaining unit that consisted of the Ryton Linehaul Drivers would not cause any further fragmentation than what was already in place.

8) In response to the matters raised by the Employer that it would be a small fragmented bargaining unit and that an appropriate bargaining unit compatible with effective management was one comprising all national Linehaul Drivers, the Union argued that the company currently and effectively managed their drivers at the Ryton depot despite there being a number of disparities in the way in which the drivers were paid and managed and how their terms and conditions were applied nationally. Those differences were acknowledged amongst the driver workforce, but they still continued to be productive employees. There were also a number of differences throughout its national structure, which operated as independent silos, and therefore applying a single site bargaining unit, the Union believed, would have no operational detriment to the business.

9) The Union provided the following examples of those differences:

1) There were multiple differences in pay. Some depots paid single time for bank holiday working, whereas others paid double time, double time and a day in lieu, and another paid triple time and no day in lieu.

2) Overtime payments varied throughout the depots. Some drivers were paid time and a half after exceeding their contracted hours, others time and a third, and some had their hours banked and then deducted from their bank if a short week occurred.

3) Glasgow v Ryton depots referenced double rates of overtime on Sundays for Glasgow and time and a half for Ryton. Overtime payment appeared to be determined by the contract within the depot, and therefore the ideology of harmonisation could be interpreted in different ways.

4) All Ryton Drivers received time and a half pay for Sunday overtime because they classed this as day six working,

5) Glasgow night drivers received double time for overtime because Glasgow classed this as day 7 working, this also applied to the Teeside depot,

6) In some cases, a depot would deduct the night shift rate from a driver while on their break whereas others did not.

7) Pay rates appeared to be different due to the way in which the works contract was interpreted. Glasgow/Teeside night drivers who started on a Monday and finished their shift on a Tuesday morning were classed as day one and two. When they started their working week it was day one, and Saturday when they finished their normal working week was day six, so if they worked overtime on the Sunday, they were paid double time because this was classed as day seven working. However, this was not the same, nor was it achievable for Day drivers at those depots, as Monday was day one and Friday day five, after which the EU driving law meant that they had a 24 hour rest period. Therefore they could only do a Sunday as a sixth shift at time and a half and they were unable to achieve day 7 overtime. This was also how it was interpreted at Ryton for both night and day shift drivers, so the works contract issued in 2018 was, to a degree, seen by drivers as unachievable.

8) New contracts for some of the depots had flexibility clauses that others did not have.

9) DHL Parcels were currently advertising Bulk Driver jobs at a number of depots. The Union maintained that this was new terminology used by the Employer for the Linehaul drivers. Those advertisements had distinct differences in the Ryton site salary. This further evidenced differences that already existed within the DHL parcel operational structure and it did not hinder their ability to effectively manage the business.

10) The Union believed that each depot was operating independently of one another and therefore its proposed bargaining unit at the single site would be compatible with the already present structure of the business without causing further fragmentation. The Union believed that this was evidenced by the following examples:

1) All holidays were authorised locally and were dependant on that depot’s availability and absence levels.

2) All disciplinary hearings and grievances were managed site by site.

3) All drivers were managed by local teams, and issues were answered by their depot manager.

4) The start and finishing location was always the same – the Ryton Depot for Ryton drivers. DHL Parcels did not have a night away policy (which meant that wherever you go you come back to the same place). All routes and jobs were short haul.

11) The Union maintained that it had copies of contracts from different depots that evidenced some of the above differences in terms and conditions and it was happy to supply those copies to the CAC on a confidential basis.

12) It was the Union’s view that the centralised management structure within the company would be unaffected by a single site recognition agreement at Ryton. It would not have any impact on the centrally controlled activity and shifts, the overall head of Fleet and Linehaul, or the Head of Network Operations. Regional Operations managers would still manage the depots. The proposed bargaining unit would work with the current business structure as holidays and disciplinaries were managed locally.

13) The Union said that there were many examples of trade union recognition agreements where a multi-site employer with a national or/and cross site management structure recognised trade unions on a site by site basis, often with multiple bargaining units across different grades that were compatible with effective management and did not cause unnecessary fragmentation. To support its point the Union relied upon the CAC decision in GMB v Lldl TUR1/953/2016 ^{[footnote 1]}. The Union explained that another example it had presented to the Employer during a meeting with Acas was that DHL operated under a national structure for their first line managers and supervision, all within a banding system for pay and terms. Within the Automotive section of DHL they had signed recognition with Unite for one site only within this group and created a single site bargaining unit. This had operated for a very long time and had not hindered DHL in effectively managing their business.

14) The Union explained that it believed it had given many examples of the differences in the terms and conditions of the Ryton Drivers compared to those drivers at the other depots, and those located at the standalone franchised sites.

15) It was the Union’s view that the operation would not need to change if recognition were granted for its proposed bargaining unit. Linehaul drivers had a base site to which they returned, even if they were then allocated to different customer jobs or sites. A recognition agreement would therefore not impact on effective management or the day to day operations. Hours were typically the same for each depot but subject to delivery requirements – this would not change. Routes that were organised centrally would be unaffected. Interaction with other drivers would not be impacted or produce any material impact.

16) Finally, the Union emphasised that it was not in its interest to disturb the operation of the business as it wanted the business to succeed, but it believed that its proposed single site bargaining unit would not only work, but it would work well.

4. Summary of Submissions made by the Employer

17) The Employer submitted that the Union had applied for recognition of the Linehaul Drivers at the Ryton Hub. However, the Employer’s view was that the only appropriate bargaining unit was one comprising its entire national team of Linehaul Drivers.

18) The Employer explained the Union’s proposed bargaining unit was not compatible with effective management and would lead to fragmentation between Ryton Linehaul Drivers and national Linehaul Drivers. The Employer stated that to separate Ryton Linehaul Drivers from National Linehaul Drivers could lead to the risk of inconsistent outcomes, anomalies, discontent, negative feeling and competition between the two groups of Linehaul Drivers and thus be incompatible with effective management.

19) The Employer stated that the national team comprised of 307 Linehaul Drives with 36 based at Ryton, and there were 44 DHLP sites across the UK and Northern Ireland. The Ryton Linehaul drivers made up to 10% of the workforce population of all Linehaul Drivers. It was explained that the national Linehaul Drivers worked together as a cohesive, integrated team who shared the same terms and conditions, including hours, pay, holidays, policies and procedures despite working in different locations; this had helped build consistency with all Linehaul Drivers. The standard letter of offer and employment contract alongside their job description was used for all non-management level employees, which included Linehaul Drivers. Within each site, a local management team was responsible for individual matters such as annual leave, disciplinary, sickness absence, and grievance. The Employer further stated that corporate functions such as Human Resources, IT and Finance were provided centrally.

20) The Executive Board of DHLP determined Linehaul Drivers’ pay in conjunction with the Head of Network Operations and the Head of Fleet and Linehaul. Linehaul Drivers’ pay and terms and conditions were not determined or influenced by the Site Managers at their base site for any Linehaul Drivers as this was dealt with centrally. If the bargaining unit was accepted, it could create a fragmented pay structure between Ryton Linehaul Drivers and the other Linehaul Drivers in that any pay increases were granted based only on the request of Ryton Linehaul Drivers and not all Linehaul Drivers based in the UK and Ireland.

21) The Employer further stated in relation to pay that there was an overtime pay difference between Glasgow and Ryton; however, this is due to locality. It was explained that overtime pay was fixed and applied to all Linehaul Drivers, including those at Ryton, which had been the case since 2018. It was further explained that night pay was added automatically by the system, and there was no manual processing required to ensure Linehaul Drivers were paid this premium when working overnight, and no site had any access to be able to make any adjustments.

22) Furthermore, all Linehaul Drivers were paid 1/12th of their salary, and there was no banking of their hours regardless of the hours they worked as it was based on their contract. There were instances where a Linehaul Driver may have worked more than their contracted hours and then they may be given that time back at a later date, however, this decision was held by the Site Managers and not the central team.

23) In response to a point raised in the Union’s submission concerning a job advertisement for Bulk Drivers, which the Union maintained was new terminology for Linehaul Drivers, the Employer argued that it was not a new term and that it was in fact a term that had been used for at least 16 years. Bulk Drivers were predominantly engaged in collection and delivery activity, and they drove larger vehicles. They were on a different rate of pay at Ryton as they were travelling longer distances to check loads.

24) The work undertaken by the national Linehaul Drivers was managed by the Central Linehaul Planning Team manually as the planned routes were interconnected with all hubs and sites to ensure customer demands were met. All Linehaul Drivers had a designated local site which was their start and finish point for their work and was stipulated in their contracts. The Employer further stated that other Linehaul Drivers would typically take their rest breaks at Ryton because it was the main hub where most parcels passed through. There was a noticeboard at the Ryton site and all other sites that provided information to all Linehaul Drivers irrespective of their contracted work location.

25) In response to the Union’s views concerning of the allocation of duties and how rates were set, the Employer asserted that the Union’s assumption on this was wrong. The allocation of work was done manually by a team, and there was no algorithm behind the scenes which calculated this.

26) Linehaul Drivers were not allocated a particular route as a fixed element of their job; they were allocated routes according to the requirements identified by the Central Linehaul Planning Team. The routes changed regularly dependent on customer demands. This was planned by Regional Night Managers who were not allocated to sites or hubs but worked together to plan the transportation of shipments nationally. However, the Employer explained that if a Linehaul driver were absent, for example, due to sickness, it was the site manager’s responsibility to find adequate cover for their absence, which occurred across other sites. This also applied to annual leave.

27) Questioned by the Panel Chair if Linehaul Drivers had fixed routes, the Employer clarified that there was a fixed start and endpoint, but it was dependent on customer demands; there could be hourly changes as they were collecting shipments from different locations.

28) With regard to the Union’s comparison of the Ryton group with single-site recognition at Jaguar Land Rover, the Employer stated that the Jaguar Land Rover organisation had a supply contract and was a separate legal entity, with its own board of directors and different operational practices. For example. The Jaguar Land Rover subsidiary was paid a fixed sum, and it could determine how its Linehaul Drivers were paid, as long as the contract between Jaguar Land Rover and DHL was fulfilled. This also applied to other franchises of DHL, in that the Employer could not dictate how they paid their staff. The Employer argued that these were therefore not relevant examples.

29) The Employer stated that the Union’s proposed bargaining unit was based on those at Ryton and not the broader workforce as there was strong support amongst Ryton Linehaul Drivers. The Employer believed that the Union may have significant membership across a bargaining unit that consisted of all national Linehaul Drivers as it had proposed. However, the Union had not been able to clarify its position on that to the Employer. Further, there were other trade unions, CWU and GMB, known to represent Linehaul Drivers at other sites.

30) The Employer invited the CAC to conclude that for the reasons set out above, the bargaining unit proposed by the Union was not compatible with effective management and, as such, it was not appropriate within the meaning of Paragraph 19B of the Schedule. It would have a significant impact on the Employer’s ability to manage the team of Linehaul Drivers effectively. The bargaining unit proposed by the Union would fragment the national team of Linehaul Drivers and could create division and differences between Linehaul Drivers even on-site at Ryton, where Linehaul drivers routinely took their rest breaks. The Employer submitted that all Linehaul Drivers should be included in the bargaining unit in order for it to be compatible with effective management.

31) The Employer, in respect of its proposed bargaining unit, submitted that the CAC had previously acknowledged that the practice of comparable employers was relevant. For example, the CAC decisions in TGWU and International Radiators TUR1/203/02; NUJ and Telegraph Group Ltd TUR1/204/02, and; BALPA and Emerald Airways Ltd TUR1/429/05.

32) The Employer submitted that the CAC had already considered the appropriateness of bargaining units in some companies where unions had requested local bargaining units in the context of companies which had consistent policies nationwide, for example the CAC decisions in ISTC and Hygena Ltd (Scunthorpe) TUR1/33/00 ^{[footnote 2]}, and Unite and the College of Law TUR1/563/07 ^{[footnote 3]}, and GMB and Shred-It3 TUR1/1105/2019 ^{[footnote 4]} and URTU and Fowler Welch Ltd TUR1/1084/2019 ^{[footnote 5]}. The Employer emphasised that in each of those cases, the unions’ analogous local bargaining unit proposals were rejected in favour of the employer’s nationwide proposal.

33) Finally, the Employer said that the bargaining unit proposed by the Union was not appropriate. Given that other unions had already approached the Employer to discuss recognition, and the comparative support for Unite/GMB/CWU had not yet been tested on a national basis, the Employer has some concerns about moving straight to a national bargaining unit for this application, without any opportunity for the preferences of the workforce being tested regarding support for other unions. However, as the CAC was obliged to identify the appropriate bargaining unit (Schedule A1 19(3)) the Employer submits that a nationwide bargaining unit was the appropriate bargaining unit.

5. Considerations

34) The Panel’s decision has been taken after a full and detailed consideration of the views of both the Union and the Employer as expressed in their written submissions and as amplified during the course of the hearing.

35) The Panel is required, by paragraph 19(2) of the Schedule to the Act, to decide whether the proposed bargaining unit is appropriate and, if found not to be appropriate, to decide in accordance with paragraph 19(3) a bargaining unit which is appropriate. Paragraph 19B(1) and (2) state 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) of the Schedule so far as they do not conflict with that need. The matters listed in paragraph 19B(3) are: the views of the employer and the union; existing national and local bargaining arrangements; the desirability of avoiding small fragmented bargaining units within an undertaking; 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 the location of workers. 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 take into account any view the employer has about any other bargaining unit that it considers would be appropriate.

36) 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.” The Panel’s decision 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.

37) The Panel’s first responsibility is to decide, in accordance with paragraph 19(2) of the Schedule, whether the Union’s proposed bargaining unit is appropriate. The Panel notes that it cannot reject the Union’s proposed bargaining unit because it feels that a different unit would be more appropriate nor, in considering whether it is compatible with effective management, can it consider whether it is the most effective or desirable unit in that context.

38) The Panel does not consider that the Union’s proposed bargaining unit is appropriate because it is confined to the Linehaul Drivers at the Ryton depot. The Union’s proposed bargaining unit does not demonstrate a distinct and identifiable group of workers within the company’s linehaul network or business model. The Drivers in the Union’s proposed bargaining unit share common terms and conditions of employment with all Linehaul Drivers across the company’s UK sites, determined by the Executive Board of DHLP in conjunction with the Head of Network Operations and the Head of Fleet and Linehaul. More significantly, the work of all Linehaul Drivers is managed by the Central Management Team, who plan the drivers’ routes which interconnect. The Ryton depot sits in the middle of the Linehaul network and the majority of the sites feed into it. There is a significant amount of interdependency between the Linehaul Drivers across all sites so as to connect and move shipments across the country without delay. The routes are not connected to a Linehaul Driver individually and change frequently according to the requirements identified by the Central Linehaul Planning Team. Therefore, to have a bargaining unit consisting of only the Ryton depot, with the potential for differences in treatment of one sub-group of Linehaul Drivers in respect of their pay, hours and holidays, could create logistical difficulties running the business.

39) Having decided that the Union’s proposed bargaining unit is not appropriate the Panel’s next responsibility is to decide a bargaining unit which is appropriate. The Panel has determined that a bargaining unit consisting of “All Linehaul Drivers” is an appropriate bargaining unit. The Panel considers that this bargaining unit is compatible with effective management. This bargaining unit is managed by a central management team and the workers share common terms and conditions of employment. The Linehaul Drivers follow the same company rules, policies and procedures, and as set out in paragraph 38 above there is also frequent interdependency between the depots.

40) The Panel has considered the matters listed in paragraph 19B(3) of the Schedule so far as they do not conflict with the unit to be compatible with effective management. The views of the Employer and the Union, as described earlier in this decision, have been fully considered. The Panel does not consider that there are any existing national or local bargaining arrangements in this case. The bargaining unit set out in paragraph 40 above does not avoid completely the risk of small fragmented bargaining units within the undertaking because it does not cover all categories of staff. However, it does carry less risk of fragmentation than that proposed by the Union. The relevant characteristics of the workers are not primarily their shared terms and conditions or their locations but the commonality and interdependence of their work. The Panel is satisfied that its decision is consistent with the object set out in paragraph 171 of the Schedule.

6. Decision

41) The Panel’s decision is that the appropriate bargaining unit is “All Linehaul Drivers”.

42) As the appropriate bargaining unit differs from the proposed bargaining unit, the Panel will 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 Tariq Sadiq, Panel Chair

Ms Stephanie Marston

Mr Rob Lummis

14 July 2021

7. Appendix

Names of those who attended the hearing:

For the Union

Ms Dorota Dudek - Senior Organiser, West Midlands

Mr Shane Edwards - Team Leader, Organising West Midlands

Ms Vivienne Martin - Stand Down Officer, West Midlands

For the Employer

Georgina Hirsch - Counsel, Devereux Chambers

Scott Laird - Vice President Operations at DHL Parcels UK Limited

Sarah Maddox - Vice President – HR at DHL Parcel UK Limited

Philip Harman - Partner, DAC Beachcroft

1. Paragraph 9. ↩

2. Paragraphs 17-18 ↩

3. Paragraphs 44-45 ↩

4. Paragraphs 47 and 48 ↩

5. Paragraphs 20 and 29 ↩