Decision

Bargaining Unit Decision

Updated 12 September 2018

Case Number: TUR1/1052/2018

11 September 2018

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

Triumph Aerospace Operations UK Ltd trading as Triumph Integrated Systems, Actuation & Control

1. Introduction

1) Unite the Union (the Union) submitted an application to the CAC dated 9 May 2018 that it should be recognised for collective bargaining by Triumph Aerospace Operations UK Ltd trading as Triumph Integrated Systems, Actuation & Control (the Employer) for a bargaining unit comprising “Unit 49 Electronics, Unit 49a, workers in test, workers in up locks, workers in stores, workers in final view, workers in freefall actuator, workers in Boeing, workers in HPRV, workers in Priority Valve, workers in Door jacks, workers in finishing, workers in Rotaries and workers in EHSV. We do not consider as part of the bargaining unit any employees that are employed on a salary contract”. The application was received by the CAC on 16 May 2018 and the CAC gave both parties notice of receipt of the application on the same day. The Employer submitted a response to the CAC dated 23 May 2018 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 Rohan Pirani, Chair of the Panel, and, as Members, Mr Mike Regan and Ms Fiona Wilson. The Case Manager appointed to support the Panel was Linda Lehan.

3) By a decision dated 26 June 2018 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 hearing was held on 7 August 2018 and the names of those who attended the hearing are appended to this decision.

4) The Panel is required, by paragraph 19(2) of the Schedule 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. In order to accommodate the hearing the Panel extended the period within which it must make its decision to 11 September 2018.

2. Summary of the submissions made by the Union

5) The Union submitted that its proposed bargaining unit was an appropriate bargaining unit and complied with paragraph 19(1) and (2) of the Schedule. The Union stated that providing the bargaining unit was compatible with, or could co-exist with, effective management then that would be enough in their opinion for the CAC to rule in their favour even if that bargaining unit was not the most compatible or desirable unit for the Employer.

6) According to the Union their members were employed at the Deeside business unit and all shared the same distinction in that they were hourly paid manual workers and worked in the production area. The Union stated that their bargaining group was easily distinguished in that they are workers being on an hourly rate. The Panel was referred to a copy of a pay slip of one of the workers said to be in the proposed bargaining unit. This showed the word “salary” at the top, a basic hourly rate for overtime paid and an hourly rate for deductions which the Employer explained would have been for lateness and/or sickness.

7) The Union did not believe that the roles of Quality Inspector, Quality Technician, Team Leaders, Receptionist or Housekeeper/Cleaner to be compliant with their proposed bargaining unit as they regarded them to be salary graded staff and not “blue-collar” hourly paid employees. hen it was pointed out by the Employer that the Housekeeper/Cleaner was on the same terms as an operator the Union confirmed that they should then be included in their bargaining unit.

8) Contrary to the Employer’s assertions that it treated all staff as “one” the Union pointed out that it did in fact separate their workers into salaried and hourly paid workers which was demonstrated in the latest version of the Employee Handbook revised in November 2017, where it is stated:

“TIME KEEPING AND ATTENDANCE

Normally employees should refer to their contract of employment for details of working hours and times, or other arrangements as made with their line management. Overtime and shift may be paid to hourly paid staff, if applicable this will be stated within the Contract of Employment.

LATENESS/ABSENTEEISM

If you are hourly paid you are expected to ‘clock in’ and be at your work station, to be ready for work, by your start time and not leave your work station until the finish time.

OVERTIME

Generally, salaried employees will not be eligible for paid overtime or receive time in lieu in respect of additional hours worked.”

9) The Union disputed the Employer’s assertion that they did not know who was in and who was out of their proposed bargaining unit. They highlighted the fact that when a membership and support check was carried out at acceptance stage of the application, the Employer was able to then identify each of the 78 workers considered by the Union to be within the proposed bargaining unit.

10) The Union explained that collective bargaining already took place at the Employer’s other sites in Staverton, Gloucestershire and Isle of Man where they collectively bargained for their members on a local agreement. The Union pointed out that the Employer’s site at the Isle of Man collectively bargained for a group of workers that excluded Managers which they believed demonstrated that a similar bargaining unit could co-exist with effective management at the Deeside site.

3. Summary of the submissions made by the Employer

11) The Employer argued for a one site bargaining unit comprising “All employees at the Deeside site other than the senior managers, being currently (i) Operations Director, Deeside; (ii) Operations Manager, Hydraulics (49A); (iii) Operations Manager, Electronics (49); (iv) Engineering Manager”.

12) The Employer stated that as a business they support trade union recognition, if that is what their employees supported and if it is consistent with effective management. However, the Employer says the proposed division of the Deeside workforce is arbitrary and not compatible with effective management. It is also contended that these difficulties would only become starker with time and would not promote efficient working practices and arrangements. The Employer stated that as a business, including within their Deeside operations, they were in an ongoing period of continued consolidation, standardisation and alignment across its business and workforce. This is said to include a continued transition towards greater consistency for and between all the workers at the Deeside site in relation to terms and conditions including holidays and hours.

13) The Employer stated that the bargaining unit put forward by the Union impeded collaborative working and cooperation across the business cutting across the company’s existing management structure. It argued that the division proposed sought to cut the workforce by physical location of equipment/area in which they worked and the way in which they were paid. The Employer says this does not appear to relate to effectively identifiable roles or responsibilities.

14) The Employer stated that the same management chain operated for hourly paid staff and for salaried staff. All staff are subjected to the same management and managed as part of and within the process/area to which they are assigned. They are not divided on the basis of the way in which they are paid and effective management at Deeside necessitates a whole site overview and approach in relation to pay and bonus. There is no distinction between salaried and hourly paid employees all staff receive a salary, the same percentage award, work 37 hours a week and get 25 days a year holiday. In respect of sick pay, only those on a legacy contract receive this. The Employer stated that all workers clock in and clock out. When asked about the Union’s reference to the Staff Handbook (see paragraph 8 above) the Employer confessed that this was out of date.

15) In relation to overtime the Employer explained that overtime had to be pre-approved and was not guaranteed. Some people got paid overtime for extra hours worked during the week whilst others would only be paid overtime if worked at the weekend and some were not entitled to any overtime. An example given was within the quality team where some were entitled to overtime whilst others were not.

16) The Employer explained the employees at the Deeside site performing the same or similar roles within the same function may be paid a salary, on an hourly rate or alternatively both salary and an hourly rate for certain hours worked. Management of the business focuses on the role not how a person is paid. The method of calculation of pay does not determine the role and equally the role does not automatically determine the method by which income is paid.

17) The Employer stated that there were numerous examples of Deeside employees who could quite feasibly move into another role in the same function where their current role would sit within the union’s proposed bargaining unit and the other role, albeit in the same function and interrelated, would not.

18) The Employer explained the Triumph group’s strategy centred around the term and phrase “One Triumph” which was a concept which was universally understood and referred to within the Triumph group. This was said to be about simplifying the business and defining and implementing performance. The phrase “One Team”, used in their mission statement is said to be core to their management and, according to the Employer, applies as much to their workforce as it does to their partnership with their customers. It argued that the Union’s proposed bargaining unit will result in separation and fragmentation which runs counter to the desire for standardisation and alignment.

19) The Employer stated that the Union’s proposed bargaining unit remained unclear in both its scope and rationale such that they remained unable effectively to identify the precise scope of the Union’s proposed bargaining unit. According to the Employer they were unable to ascertain, with any certainty, which employees fell within and outside what was the proposed unit. Although the list produced by them at the acceptance stage for the membership and support check was for 78 workers it was argued that the number could quite easily have been larger.

20) In a similar vein, the Employer stated that there was no bright line/no obvious identifiable boundary delineating the workers described in the bargaining unit proposed by the Union. It said that some posts could, feasibly but without any substantive justification, fall within or without the Union’s proposed bargaining unit. Such anomalies could include a supervisor who also did assembly work, a senior technician or a supervisor who used to be an operator. Each of these posts, it is said, might or might not be included in the proposed unit.

21) The Employer stated that they were implementing the new role of “Cell Leader”, which sat between the relevant “cells” being a group of employees performing a common task and a Team Leader, being a person responsible for a number of “cells”. The role was a senior role, albeit not a management role, sitting just below the team leader role. The person would perform what night be described as both manual and non-manual tasks. Though they had decided to engage the two recruited “Cell Leaders” on an hourly rate, in reality, they could as easily have been paid a salary. It was therefore argued that there would be no sensible rationale to exclude any such a worker merely because they were employed on a “salary contract”.

22) The Employer stated that the union refused to consider all the employees on site in its bargaining unit merely because they felt they did not have the numbers in support. The company submitted this was not a proper reason when considering appropriateness. The only true common denominator between the functions and groups was simply the fact that Unite believed the employees performing those functions had indicated support for trade union recognition by trade union membership. On this basis alone, the proposed bargaining unit is not compatible with effective management. The Employer said that there was no evidence why a one site bargaining unit would not work. The Employer said that bargaining units frequently included more than one category of staff and the arbitrary exclusion of salaried employees was not compatible with effective management.

4. Considerations

23) 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. 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 so, 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.”

24) The Panel is first tasked with determining whether the bargaining unit proposed by the Union is appropriate. The Panel should not 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, should it consider whether it is the most effective or desirable unit in that context. There is no requirement on the Panel to seek to identify a more appropriate bargaining unit if it finds that the union’s proposed bargaining unit is appropriate. However, we note that paragraph 2(3) of the Schedule states that “References to the proposed bargaining unit are to the bargaining unit proposed in the request for recognition”. It is the bargaining unit set out in the Union’s request that we must assess first.

25) The views of the Employer and the Union, as described earlier in this decision, have been fully considered.

26) The Panel has noted the Employer’s concern that the line between so called salaried and hourly paid is not always easy to draw. The Panel also noted that all pay slips refer to “salary” rather than hourly paid employees or salaried employees and that all employees at the site are entitled to 25 days holiday per year and are contracted to work 37 hours per week. The distinction between so-called hourly paid and those on a salary contract appears to relate to no more than what is regarded as an entitlement to hourly paid overtime on top of salary. However, all overtime must be pre-approved, none is legally guaranteed and all employees clock in and out. Therefore such entitlement, even on the Union’s case, is not contractual.

27) The Panel also notes that there are individuals performing the same or similar roles within the same function who may be paid a salary, or paid on an hourly basis or even both a salary and an hourly rate for certain hours worked. Those who work in quality inspection could be described as salaried or hourly paid. Further, contrary to what the Union has argued, it is difficult to draw a clear line between those working on quality inspection and those working on what is regarded as production. There is also the risk that the Union’s proposed bargaining unit would cut across the company’s existing management structure. Although some employees clearly fall within what the union describes as hourly paid at the margins it appears to be unclear and, to some extent, arbitrary.

28) The Panel considers that there would be some difficulty distinguishing the workers in the proposed bargaining unit from other workers. Even when the distinction is clear it may be arbitrary without any clear rationale. Accordingly, the Panel does not believe that the Union’s proposed bargaining unit is compatible with effective management and is therefore not an appropriate bargaining unit.

29) The Panel is now tasked with looking at the bargaining unit put forward by the Employer. The Panel noted the argument put forward by the Employer that all workers were treated the same, working the same core hours, receiving the same holiday and bonus percentage. The so-called “One Triumph” philosophy includes bringing the workforce together with regard to terms, working conditions and policies. The Panel does not believe that the bargaining unit put forward by the Employer would create any conflict of interest and thereby be incompatible with effective management. The Employer however acknowledged that their Staff Handbook was out of date and the Panel would recommend they should consider updating it further to take account of the current position.

30) The Panel does not consider that there are any existing national or local bargaining arrangements in this case and has concluded that a bargaining unit composed of workers as put forward by the Employer does not conflict with the object of encouraging and promoting fair and efficient practices and arrangements in the workplace. The Panel is satisfied that its decision is consistent with the object set out in paragraph 171 of the Schedule.

5. Decision

31) We have decided that the appropriate bargaining unit is that proposed by the Employer namely “All employees at the Deeside site other than the senior managers, being currently (i) Operations Director, Deeside; (ii) Operations Manager, Hydraulics (49A); (iii) Operations Manager, Electronics (49); (iv) Engineering Manager” .

32) 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 Rohan Pirani, Chair of the Panel

Mr Mike Regan

Ms Fiona Wilson

11 September 2018

6. Appendix

Names of those who attended the hearing:

For the Union

David Griffiths - Regional Officer

John Toner - Regional Legal Officer

Dean Shone - Organiser

For the Employer

Karen Conway - HR Director

Andrew Jory - Operations Director

Peter Fowler - Company President

John Bowers QC - Barrister

Patrick Brodie - Legal Advisor

Kelly Thomson - Legal Advisor