As mentioned by this author in another current awareness article on this website (10/8/2009), the defendants in Copley in July petition for leave to appeal against the Court of Appeal's judgment in June allowing the claimants' appeals.

In Copley, Maden the Court of Appeal (Longmore LJ giving judgment with which Jacob and Waller LJJ agreed) held that the claimants had not failed to mitigate their losses when they opted to make use of vehicles supplied on a credit hire basis by Helphire (UK) Ltd rather than make use of 'free' vehicles offered to them by the defendants' insurer, KGM. The court concluded that it was not unreasonable for a claimant to reject or ignore an offer from a defendant (or his insurers) which does not make clear the cost of hire to the defendant for the purpose of enabling the claimant to make a realistic comparison with the cost which he is incurring or about to incur. It also concluded, obiter,  that where a claimant does unreasonably reject a defendant's offer of a replacement car, he is entitled to recover at least  the cost which the defendant can show he would reasonably have incurred; he does not forfeit his damages claim altogether.

In their petition the defendants argue that the Court of Appeal's decision represents an "unwarranted and unprincipled development of the doctrine of mitigation which is not only unsupported by, but appears contrary to, established authority ...".

Traditionally, the doctrine of mitigation of loss has been interpreted as involving a principle that claimants should take all reasonable steps to avoid or eliminate their losses whether resulting from a breach of contract or a tort. The sanction for default being that damages are not recoverable to the extent that they relate to losses that could have been avoided or eliminated by the taking of such steps. The defendants argue in the petition in Copley, Maden that the Court of Appeal has erroneously created a new principle that now "the claimant does not even have to consider the prospect of avoiding any potential loss, unless he knows the actual or true impact that acceptance of the [defendant's] offer will have on the defendant's own commercial or financial position".

 The Claimants' objections to the petition

The Claimants argue in their objections that the petition misconstrues the doctrine of mitigation of loss.

They maintain that the doctrine's distinctive feature is that an injured party is bound to act with the reasonable interests of the wrongdoer in mind rather than to take steps to avoid or minimise his own injury / losses as such. Referring to the House of Lords decision in British Westinghouse Co v Underground Rly [1912] AC 673, the Claimants assert that the doctrine requires the injured party to concern himself with whether his acts unreasonably result in detriment to a defendant rather than - it is implied - with whether he should avoid his own loss.

Citing Pearson LJ's comment in Darbishire v Warren [1963] 1 WLR 1067 at 1075 that a claimant "is not under any actual obligation to adopt the cheaper method .... he is fully entitled to be as extravagant as he pleases but not at the expense of the defendant", the claimants argue that it is technically inaccurate to say that there ever exists a 'duty' to mitigate. They suggest that the doctrine requires less restrictively that an injured party does not act unreasonably towards a defendant's interests rather than that he does not act unreasonably with regard to his own interests.

These premises lead the authors of the objections to suggest that the defendants' petition rests on a "failure to understand the first principles of mitigation" which petition relies on the following "facile" underlying argument: "'if the claimant had acted reasonably, he would have suffered no loss because KGM would have paid the hire charges directly'". The claimants comment that this argument is question-begging: "how has the claimant acted unreasonably unless, and to the extent that, his actual course of action has increased the potential expense to the defendant? KGM ..." (the defendants' insurer) "... misses the point that it is this issue of unfairly heaping expense onto the wrongdoer which is the law of mitigation's only concern."

 The authors of the claimants' objections to the petition advance additionally various policy arguments concerning why the Court of Appeal's decision in Copley, Maden should not be impugned. For example, it is argued that the Court of Appeal's decision ensures that where there is a failure to mitigate the parties are placed in the position they would have been in if the claimant had acted in the way that the court finds that he should have done - "[t]his should be the only concern of the mitigation doctrine, which is not concerned to curb the claimant's behaviour.... but only to protect the defendant from the consequences of unreasonable behaviour" by the claimant. Secondly, it is suggested the Court of Appeal's conclusion prevents a defendant from enjoying a windfall because of his victim's misjudgment where the latter rejects the defendant's offer of a 'free' vehicle when its acceptance would result in some expense albeit a lower expense than the claimant has incurred. Finally, the claimants object that the Court of Appeal's approach must be correct because if KGM's argument were accepted - that the offer of a suitable 'free' vehicle is sufficient to extinguish a claim - claimants would be "driven to accept such offers in terrorem, even if the risk of a court subsequently finding a failure to mitigate was thought to be small". This prospect, they argue, is contrary to the principle that injured parties should have autonomy in deciding how to respond when they suffering a wrong; i.e. their "right to self-determination in light of a wrong ...".

Whether the Supreme Court will share the claimants' view that the principles of mitigation that they refer to are "both settled and salutary" is at present is unknown. However, a decision on the defendants' application for permission to appeal is expected hopefully this month.

In Copley, Maden the Court of Appeal (Longmore LJ giving judgment with which Jacob and Waller LJJ agreed) held that the claimants had not failed to mitigate their losses when they opted to make use of vehicles supplied on a credit hire basis by Helphire (UK) Ltd rather than make use of 'free' vehicles offered to them by the defendants' insurer, KGM. The court concluded that it was not unreasonable for a claimant to reject or ignore an offer from a defendant (or his insurers) which does not make clear the cost of hire to the defendant for the purpose of enabling the claimant to make a realistic comparison with the cost which he is incurring or about to incur. It also concluded, obiter,  that where a claimant does unreasonably reject a defendant's offer of a replacement car, he is entitled to recover at least  the cost which the defendant can show he would reasonably have incurred; he does not forfeit his damages claim altogether.

In their petition the defendants argue that the Court of Appeal's decision represents an "unwarranted and unprincipled development of the doctrine of mitigation which is not only unsupported by, but appears contrary to, established authority ...".

Traditionally, the doctrine of mitigation of loss has been interpreted as involving a principle that claimants should take all reasonable steps to avoid or eliminate their losses whether resulting from a breach of contract or a tort. The sanction for default being that damages are not recoverable to the extent that they relate to losses that could have been avoided or eliminated by the taking of such steps. The defendants argue in the petition in Copley, Maden that the Court of Appeal has erroneously created a new principle that now "the claimant does not even have to consider the prospect of avoiding any potential loss, unless he knows the actual or true impact that acceptance of the [defendant's] offer will have on the defendant's own commercial or financial position".

Moreover, they argue that because the Court of Appeal's decision in Copley, Maden is not stated as being confined to the sphere of credit hire litigation, it will have "surprising consequences". An example given concerns sale of goods cases where a seller offers replacement goods of satisfactory quality to replace defective goods. In such cases the buyer would have a right to refuse the replacement goods unless the cost to the seller were less than the damages which the buyer would otherwise suffer. Moreover, if the buyer were to unreasonably reject the offer, he would be entitled to recover the amount which it would have cost the seller to supply the replacement goods. Another example relates to personal injury litigation. In such cases it is established law that a claimant fails to mitigate where he unreasonably refuses to undergo treatment that would alleviate his injury. Applying the Court of Appeal's approach in Copley, Maden, if a defendant tortfeasor offers to fund such treatment, the claimant would have no duty to consider undertaking the treatment unless he knew the cost to the defendant, and where such knowledge existed, he would be entitled to recover the cost to the defendant of that treatment in the event that he were to unreasonably refuse it.

Whether the successor to the House of Lords will entertain these arguments will not be known until later in the summer or the autumn when its decision on the petition is expected. However, depending on the outcome of the petition and any eventual appeal, if the Court of Appeal's decision in Copley, Maden is interpreted as being of general application rather than confined to its particular facts, it will be of interest to civil practitioners generally as well as those concerned with credit hire disputes.

Why are unions treated differently from other natural "corporations", i.e. churches, political parties, friendly societies, campaigning organisations, sports clubs, etc?

Why are artificial corporations, i.e. companies, not subject to the same statutory constraints as natural "corporations", i.e. unions, e.g. the Board of Directors does not have to ballot the shareholders before locking out workers or changing terms and conditions of employment?

Why should organised money, i.e. companies, be privileged with limited liability while organised people, i.e. unions, are heavily regulated by the State?

Why is finance capital barely regulated by the State in contrast to the State's highly prescriptive regulation of the unions?

1979 - 1997: THE CONSERVATIVE GOVERNMENT

The Conservatives in opposition took the decision not to repeat a wholesale restructuring of collective labour law in one Act of Parliament, i.e. the Industrial Relations Act 1971. Instead when in power they embarked on a step by step approach.

During 18 years, from 1979 - 1997, the Conservative Government published 7 Green Papers, 6 White Papers, 1 Charter, revoked the 1946 House of Commons Fair Wages Resolution and the 1972 Industrial Relations Code of Practice and enacted 9 Acts of Parliament.

The ideological role of Hayek and the Conservative think tanks e.g. the Institute of Economic Affairs and the Centre for Policy Studies; the 1977 Stepping Stones Report and the 1978 Ridley Report: The Conservatives' aim was to break the unions and promote privatisation and deregulation. To achieve this State regulation was needed to deal with the opponents of change, i.e. the unions, and to enable market forces to blossom.

By 1997 union members had little liberty to associate, i.e. unions were unable to discipline or expel strike-breakers or exclude scabs from membership.

The liberty to strike was heavily restricted because neither closed shop strikes nor solidarity action was lawful. Elaborate statutory balloting was needed to hold lawful strikes.

There was no statutory support for a liberty to organise following the repeal of the statutory recognition procedure in the Employment Protection Act 1975 and the elimination of the pre-entry and post-entry closed shops undermined workers' collective power.

In November 1996 the Conservatives produced a their last Green Paper entitled "Industrial Action and the Trade Unions" in which the Government proposed the removal of immunity from industrial action which had disproportionate or excessive effects, i.e. one or more of (i) risks to life, health or safety; (ii) threats to national security, (iii) serious damage to property or to the economy, (iv) significant disruption of everyday life or activities in the whole or part of the country (para. 2.5). The Green Paper also proposed raising the threshold for an industrial action ballot from a majority of those voting to a majority of those entitled to vote, i.e. abstentions being counted as votes against industrial action.

1979 - 1997: THE TUC's PROPOSALS

In 1986 the TUC published "Industrial Relations Legislation" which was critical of the statutory recognition procedure in the Employment Protection Act 1975.

From 1990 onwards (if not earlier) the TUC warmed to the concept of a policy of phased recognition leading to full recognition which crystallised in the 1995 TUC Congress document "Your Voice at Work".

Your Voice at Work (1995) proposed 3 broad new rights (i) a universal right to representation and the right of unions to organise and have access to the workplace and protection for individuals against victimisation (ii) consultation rights when 10% of the employees were union members, and (iii) collective bargaining rights if a majority in a ballot, or some other means of surveying opinion, wanted collective bargaining rights. The right of representation was confined to a recognised union if there was one.

By 1997 the TUC had implicitly accepted the Conservative Government's restrictions on (i) the liberty to associate and (ii) restrictions on the liberty to strike. In contrast the TUC was in favour of (iii) a limited liberty to organise and the restoration of union recognition at GCHQ.

1979 - 1997: LABOUR IN OPPOSITION

Initially, Labour and the TUC were in favour of repealing all anti-union laws, i.e. a return to the status quo in 1979. In 1985 the TUC and Labour Party Liaison Committee said that when in power a Labour Government would repeal the Government's divisive legislation and replace it with positive legislation.

In 1991 the Labour Party proposed in "labour's better way for the 1990s" that (i) trade union rights would be restored at GCHQ (ii) the European Social Charter would be signed (iii) there would be a national minimum wage, and (iv) a flexible decade of retirement between 60 and 70.

At the October 1994 Labour Party conference, Mr Blair said that strike ballots were to be retained. In September 1995, Mr Blair told the TUC that there was not going to be a repeal of all the Tory trade union laws.

In the June 1996 document "Building Prosperity - Flexibility, Efficiency and Fairness at Work" the Labour Party said that "The old approach of trade union immunities as the basis for legislation has gone. Indeed the Labour Party was moving away from it, even in the 1980s. There will be no blanket repeal of the main elements of the 1980s legislation ... social partnership is at the heart of the successful company of the future." The proposals were that (i) individuals should have the right to be accompanied at disciplinary or grievance procedure meetings (ii) employees would have a choice as to whether to join a union or not (iii) a majority vote would secure collective bargaining on pay, hours, holidays and training (iv) dismissed employees engaged in lawful industrial action could complain to employment tribunals, and (v) repeated authorizations from union members to confirm the check-off of union subscriptions would be ended.

1997 - 2008: THE NEW LABOUR GOVERNMENT

In the foreword to the May 1998 "Fairness at Work" White Paper Mr Blair said that "There will be no going back. The days of strikes without ballots, mass picketing, closed shops and secondary action are over. Even after the changes we propose, Britain will have the most lightly regulated labour market of any leading economy in the world."

LIBERTY TO ASSOCIATE

The only cosmetic concession to the unions in the Employment Relations Act (ERA) 1999 was the abolition of the 2 Commissioners (CROTUM and CPUIA) and their replacement by the Certification Officer with strengthened quasi-judicial powers.

Following the case of Lee v. ASLEF (24 February 2004 UKEAT/0625/03) section 33 of the ERA 2004 was passed amending section 174 of the Trade Union and Labour Relations (Consolidation) Act 1992. The amendment drew a distinction between political party membership (protected conduct) and political party activities (not protected conduct).

The European Court of Human Rights in ASLEF v. United Kingdom [2007] IRLR 361 stated at paragraph 39 that Article 11 of the European Convention on Human Rights "... cannot be interpreted as imposing an obligation on associations or organisations to admit whosoever wishes to join." The ECHR went on to say that "By way of example, it is uncontroversial that religious bodies and political parties can generally regulate their membership to include only those who share their beliefs and ideals ... in the exercise of their rights under Article 11(1) unions must remain free to decide, in accordance with union rules, questions concerning admission to and expulsion from the union ...". The ECHR decided that ASLEF's Article 11 rights to freedom of association had been violated by the UK Government.

Despite the ECHR's decision that Article 11 of the European Convention on Human Rights "... cannot be interpreted as imposing an obligation on associations or organisations to admit whosoever wishes to join" the Government decided to ignore it. In a consultation document entitled "ECHR judgment in ASLEF v UK case - implications for trade union law" it stated that "The Court did not give any opinion as regards other limitations under UK law on the ability of trade unions to expel, exclude or otherwise discipline their members. Nor do the general principles set out in the Court's judgment imply that there can be no justification under Article 11 for other limitations on the freedom of trade unions to determine their membership" (paragraph 4.2).

ASLEF succeeded in its argument that its Article 11 rights had been violated (paragraph 53). The Government failed in its argument that  "... the special status of trade unions ... set them apart from other voluntary associations ... they play a potentially very important role in the working lives of individuals ... exercising a direct influence over matters such as pay, holidays and other terms and conditions of employment ..." (paragraph 34).

Clause 19 of the Employment Bill 2008 amends section 174 of TULR(C)A 1992 to deal with membership of a political party where it is contrary to a rule or objective of a union. Unions will still be unable to discipline or expel strike-breakers or exclude scabs.

LIBERTY TO STRIKE

In Blackpool and the Fylde College v. NATFHE [1994] ICR 648, the Court of Appeal decided that when a union balloted their members over industrial action (sections 226A and 234A of TULR(C)A 1992) the union had to specify a category or name individuals or, by a combination of the two, enable the employer to readily ascertain which employees were being balloted. 

The ERA 1999 in schedule 3 amended sections 226A and 234A by removing "describing (so that he can readily ascertain them) the employees of the employer" and replaced it with "containing such information in the union's possession as would help the employer to make plans and bring information to the attention of those of his employees." If the union possessed the information then it was to provide details as to the number, category or workplace of the employees concerned.

The ERA 1999 amendments to sections 226A and 234A were considered in National Union of Rail, Maritime and Transport Workers v. London Underground Ltd [2001] IRLR 228, where the Court of Appeal remarked that the ERA 1999 changes were not intended to make the preparation of balloting notices easier and indeed it might make the task more onerous because a union was not bound to provide a list of names (paragraph 46).

As an alternative to seeking an injunction to prevent unlawful industrial action an employer can seek damages for damage caused by unlawful industrial action. In Willerby Homes v. UCATT [2003] EWHC 2608, QBD, UCATT had to pay £130,458 in damages plus costs for losses incurred in a two week strike because it had given the employer erroneous information about the members to be balloted and lost its protection under section 226A.

The ERA 2004 again amended 226A and 234A to introduce a requirement on unions to produce two lists (a) a list of categories of employees and (b) a list of the employees workplaces (alternatively, or in addition to check-off lists). This is to enable employers to readily deduce (a) the total number of employees concerned (b) the number of employees in each of those categories, and (c) the number of employees at each workplace.

The Texas Pacific Group Gate Gourmet (GG) dispute illuminates the potential consequences flowing from unlawful industrial action. On 10 August 2005 GG workers attended a mass meeting in the works canteen. They were given 3 minutes to get back to work or be sacked. An unlawful solidarity strike by British Airways (BA) ground staff cost BA £40m. GG replaced the sacked GG workers with agency workers from Versa Logistics, a wholly owned subsidiary of GG. On 21 August 2005 the High Court granted an injunction restraining the T&G from picketing away from site B (500 metres from GG's premises) and limiting pickets to 6 at site A opposite GG's premises. On 22 August GG threatened to put the company into administration unless BA paid GG more for its in-flight meals. On 24 August GG lifted its threat following an agreement with BA over the terms of an improved supply contract. On 26 August GG and the T&G reached an agreement to settle the dispute. On 14 December the Financial Times reported that 100 ex-employees of GG had failed in their claims of unfair dismissal as an employment tribunal had decided that their strike was "illegal." On 28 February 2006 Personnel Today reported that GG had re-engaged 252 out of 800 sacked staff. The similarities with Murdoch's dismissal of 5,000 print-workers at Wapping in January 1986 are obvious.

LIBERTY TO ORGANISE

The proposed right to accompaniment in "Fairness at Work" alarmed the Financial Times which in an editorial dated 22 May 1998 said that "... any union member ... will have the right to union representation during grievance or disciplinary procedures. That last ... provides the unions with a toe-hold in any company in the land, and the CBI is right ... that ... it should only apply to disciplinary matters, not run of the mill grievances. It could prove a powerful recruiting sergeant for the unions ...". Barrie Clements in the Independent on 11 July 1998 confirmed that the CBI were concerned that, where unions were not recognised, they could prevail on their members to register grievances on pay which, with sufficient numbers, could become a collective wage claim.

The ERA 1999 was enacted on 27 July. During the passage of the Bill the right to representation was whittled down by defining a grievance as a duty owed by an employer to a worker, e.g. a statutorily implied equal pay clause in a worker's contract (Section 13(6)).

The Section 10 ERA 1999 right is to accompaniment by an employed union official, or a certified official employed by that employer, i.e. a worker's companion can be an employee of an unrecognised union. The right came into force on 4 September 2000. Compensation for a breach of this right is up to 2 weeks wages currently capped at £330 a week. This is a union right which is not dependent on an employer recognising a union.

The Flexible Working (Procedural Requirements) Regulations 2002 came into force on 6 April 2003. The right to be accompanied is confined to a fellow worker. Similarly, in schedule 6, paragraph 9(2)(b), of the Employment Equality (Age) Regulations 2006 which came into force on 1 October 2006.

The ERA 1999 brought in the third attempt at statutory recognition. The current version has more in common with the IRA 1971 than the EPA 1975 and like statutory recognition in the United States incorporates employer free speech rights, i.e the ability of employers and their agents, e.g. the Burke Group, to campaign against union recognition. Legitimate campaigning activity includes threatening to shut the company if the workers vote in favour, i.e. (i) Amicus and GE Thermometrics (UK) Ltd (TUR 1/347/04) and (ii) BECTU and Sky Subscriber Services Ltd (TUR 1/222/02). Unsurprisingly in both cases the unions failed to obtain recognition.

The procedure gives employers the right to choose the workers' union. The level of support for the workers' choice is irrelevant if the employer has helped to create and recognise a dependent "union", i.e. Prison Officers' Association and Securicor Custodial Services Ltd (TUR1/5/00) and the News International Staff Association. Alternatively, an employer can

recognize an unrepresentative independent union with no or very few members in that company, i.e. Bausch and Lomb (Award plc) (TUR 1/8/00) where the company had an agreement with the AEEU and consequentially the Central Arbitration Committee did not accept the ISTC's application. In National Union of Journalists and Sports Division Mirror Group Newspapers Ltd (TUR 1/307/03) the NUJ's application for recognition was rejected as the company recognised the British Association of Journalists who had one member. The CAC found that over half the journalists were in the NUJ. The NUJ's appeals to the High Court and Court of Appeal were rejected.

If the CAC declares that a union is recognised then the employer has to engage in a dialogue with the union through a bargaining procedure. The employer is not obliged to agree to changes to terms and conditions of employment, i.e. pay, hours or holidays. There is no recourse to arbitration, e.g. schedule 11 of the EPA 1975. Even with a legally enforceable contract the obligation on the employer to negotiate is purely procedural. The employer's ability to negotiate different terms with individuals is safeguarded by paragraph 18 of the Trade Union Recognition (Method of Collective Bargaining) Order 2000.

The Government published a consultation paper entitled a "Review of the ERA 1999" in February 2003. The Government proposed (i) that after the CAC had decided that a union's application was admissible and prior to a ballot the union could distribute written material via a qualified independent person. No similar restrictions were placed on employers who could communicate directly with their employees; (ii) Pensions were not to be regarded as pay reversing Union Bank of Nigeria v. Unifi [2001] IRLR 712 (TUR 1/16/00); (iii) section 146(3) of TULR(C)A 1992 (the Ullswater amendment) should be repealed and the law amended to "... to specify that the entering of individualised contracts would not constitute unlawful union discrimination against those union members not offered them, provided there is no pre-condition in the contracts to relinquish union representation...". There was protection for the bare right to be a union member but nothing more, i.e. no protection for union negotiated collective agreements.

The Review then dealt with the judgment of the ECHR in Wilson and NUJ v. UK and Palmer and Others and NURMTW v. UK [2002] IRLR 568. The ECHR at paragraph 42 said that "A trade union must thus be free to strive for the protection of its members' interests, and the individual members have a right, in order to protect their interests, that the trade union should be heard ...". At paragraph 46 the Court continued "Furthermore, it is of the essence of the right to join a trade union for the protection of their interests that employees should be free to instruct or permit the union to make representations to their employer or to take action in support of their interests on their behalf. If workers are prevented from so doing, their freedom to belong to a trade union, for the protection of their interests, becomes illusory. It is the role of the State to ensure that trade unions members are not prevented or restrained from using their union to represent them in attempts to regulate their relations with their employers."

The Government's response to this judgment was to ignore it. They said (page 65, paragraph 3.17) that "The judgment refers to the right for the union "to be heard", which the Court views as inherent to Article 11 ... However, the Court has never expressed any view on what the right implies as a minimum. It has certainly never stated that the right to be heard requires the employer to respond to the points a union might make ... Under current UK law, unions can exercise their right to be heard by a number of means, including the freedom to be recognised or seek recognition ... and generally to make representations to the employer. These and other arrangements guarantee the right to be heard implied by Article 11."

The Employment Act 2002 (Dispute Resolution) Regulations 2004 came into force on 1 October 2004. Regulation 9 contains a provision confining the raising of collective grievances to independent recognised unions and recognised employee representatives, i.e. excluding independent unrecognised unions. The section 10 ERA 1999 right of the unrecognised union to accompany an individual was not extended to a collective right to accompaniment in the regulations implementing the 2002 statutory procedures which are due for repeal by April 2009.

The Information and Consultation of Employees Regulations 2004 came into force on 6 April 2005. The ability of employers to avoid directly consulting with employee representatives is safeguarded under regulation 16(1)(f)(ii) which states that a negotiated agreement can provide that the employer communicates information directly and consults directly with employees. The employer is responsible for electing or appointing the representatives who are to negotiate with the employer over the terms of the information and consultation agreement.

THE UNIONS IN 2008

Trade union membership has dramatically declined since 1979. In 1980 the Certification Officer (CO) said that here were 13,212,354 union members. In 1998 the CO said that the 1997 figure was 7,938,213. The CO report for 2006-7 gives a figure of 7,602,842. Over the New Labour decade overall trade union membership has stagnated in contrast to the growth of union membership between 1975-9.

The Labour Force Survey figures show 6,911,000 union members in 1997 and 6,677,000 in 2005. The density of union membership in Autumn 1997 was 27.5% and 26.2% in Autumn 2005. In Autumn 2005 less than one in five (17.5%) private sector employees were union members but almost three in five (58.6%) public sector employees were union members.

The marked difference in the density of private and public sector trade union membership is partly attributable to the fact that union recognition is the norm in the public sector. In contrast in much of the private sector the unions have no legitimacy.

2008 AND THE NEAR FUTURE

There is a common theme linking the statutory restrictions on the liberty to associate, strike and organise, i.e. that unions are illegitimate and that non-union employees, employers and the public need to be protected from trade unionism. Private sector employers have a veto on voluntary union recognition and with a declaration of statutory recognition they only have to go through a negotiating procedure.

In general there appears to be tri-partisan party political support for the status quo. The TUC appear to be broadly satisfied with current collective labour law and shows no appetite for change.

Between now and the next General Election the only opportunities for changing statute law are the current Employment Bill or the forthcoming Equality Bill. Radical positive change seems extremely unlikely as the priority of the Labour Party affiliated unions will be the re-election of a Labour Government.

Over the next 18 months to 2 years or more the impact of the economic recession on employment levels and trade union membership is likely to be negative.

In the next couple of years there is the possibility of a change of Government which raises the question of what changes the Conservatives might make to collective labour law. At the moment there is little indication that collective labour law reform is a Conservative priority. Given New Labour's adherence to neo-liberalism the Conservatives may take the view that statutory recognition is compatible with neo-liberalism and consider that the current statutory recognition regime is similar to the first statutory recognition procedure brought in by the Conservatives under the Industrial Relations Act 1971, i.e. that the objectives of the IRA 1971 have been achieved.

IS THERE AN ALTERNATIVE?

This is not 1824-5, 1871-5, 1906 or 1974. All the major parties support the status quo, as does the TUC and, through membership of the TUC, the TUC affiliated unions. The unions affiliated to the Labour Party also give financial support to New Labour's neo-liberal policies. There is currently no movement, party or organisation proposing a liberty for workers to associate, strike and organise. However, some simple principles can be suggested by way of a radical alternative to the status quo.

Following the ECHR decision in ASLEF v. UK on liberty of association, unions should have the freedom to decide who can join a union and the circumstances under which individuals can be disciplined, expelled or excluded from membership.

Following the ECHR decision in Wilson and NUJ v. UK on liberty to organise, workers should be able to join and be collectively represented by a union of their choice.

The liberty to organise has been bedevilled by the problem that, prior to Wilson & Palmer in the ECHR, it had been an individual and not a collective right. The "right" to strike has been bedevilled by Lumley v. Gye ([1853] 118 Eng. Rep. 749, QBD) liability where the union in tort is placed in the position of inducing another person to break a contract, etc, (section 219(1) of TULR(C)A 1992). The separation of the individual from the collective establishes the triangular relationship necessary for Lumley v. Gye liability and the bilateral employer/employee relationship is the foundation of the breach of contract which is an unlawful act.

There is no similar distinction between a company (the collective) and a shareholder (the individual). The artificial corporation has a single legal personality and can engage in industrial action, i.e. a lockout, like Gate Gourmet, without the need to comply with any statutory obligations, unlike trade unions, i.e. sections 219-246 of TULR(C)A 1992.

To gain the liberty to strike, there will need to be the suspension of the (individual) employment contract during (collective) strike action and the removal of Lumley v. Gye liability so that the liberty to strike is an individual right which is exercised collectively. Lord Nicholls in OBG Ltd v. Allan [2007] IRLR 608, HL, said that, in Lumley v. Gye cases, "... the defendant is responsible for the third party's breach of contract which he procured. In that circumstance this tort provides a claimant with an additional cause of action. The third party who breached his contract is liable for breach of contract. The person who persuaded him to break his contract is also liable, in his case in tort." He described the tort as a form of "accessory liability" as it is secondary to the third party who commits a breach of his contract (paragraph 171).

There are practical problems in trying to articulate alternatives to the status quo. There is no easy way forward but, if the trade union movement continues to support, and in some cases bankroll, the Government's neo-liberal policies, it will be impossible to regain at least the autonomy that the trade unions enjoyed in 1979.

There was no dispute that, if the Patent was valid, then Drammock had infringed by selling, and LEC had infringed by manufacturing, a cooling spray product to the formulations.

The defendants argued that the Patent was anticipated by a number of prior art publications and by prior use by LEC, and/or was obvious over those items of prior art and/or the common general knowledge.

Mr Justice Arnold was required to deal with a number of points of claim construction, of which the most important was to construe the word "for" in the phrase "for providing a supply of water based cooling mixture" within two product claims of the Patent. 

The claimant argued that the phrase should be read as meaning "for the purpose of".  This would restrict the scope of the claims to compositions which were intended for specific types of cooling spray, so that prior uses which were not directed to these purposes would not anticipate the patent.  The claimant relied for support of this contention on the recent Court of Appeal decision Actavis v Merck [2008] EWCA Civ 444.

Arnold J disagreed, finding that the correct construction was the traditional and broader "suitable for", which was proposed by the defendants.  The practice of allowing use claims, where the only novelty lay in the purpose of the use, had never been extended to product claims, either in the English courts or in the EPO. 

It followed that the claims were anticipated by a number of prior art publications which disclosed water/DME compositions intended for various uses.  On the evidence, the claims were also anticipated by the prior use of LEC.

The claims were also obvious over the common general knowledge of the aerosol development technician, and over a number of the cited prior art publications. 

Addressing the defendants' counterclaim for unjustified threats, Mr Justice Arnold considered whether certain communications conveyed a threat of proceedings, and found that they did because they would have reasonably been understood as doing so.   He then considered whether certain communications were protected by s.70(4)(a) as being threats in respect of manufacture, and found that, when read together with the undertakings demanded, the threats related also to supplying to customers, and so were not protected.

Mr Justice Arnold then turned to the new s.70(2A), which reads:

"If the defendant proves that the acts in respect of which proceedings were threatened constitute or, if done, would constitute an infringement of a patent -

(a) the claimant shall be entitled to the relief claimed only if he shows that the patent alleged to be infringed is invalid in a relevant respect;

(b) even if the claimant does show that the patent is invalid in a relevant respect, he shall not be entitled to the relief claimed if the defendant proves that at the time of making the threats he did not know, and had no reason to suspect, that the patent was invalid in that respect."

As to whether FNM had "reason to suspect" that the patent was invalid, the Judge considered that an objective assessment was called for, based upon what FNM knew at the time of each threat.  FNM's knowledge included information which had been brought to its attention by the defendants.

FNM's knowledge at the relevant time included the fact that some of the prior art which the Judge had found to invalidate the Patent had been cited against FNM's corresponding UK patent application, which had been withdrawn when the European Patent was granted.  However, it was relevant that FNM had been able to persuade patent offices in the USA and Japan to grant corresponding patents in the face of that prior art. Therefore Arnold J found that the citation alone did not give FNM reason to suspect that the Patent was invalid.  

Mr Justice Arnold also found that mere assertions that the Patent was invalid, made by the defendants or their representatives in correspondence, did not give FNM reason to suspect that the Patent was invalid, because the assertions were in general terms and unsubstantiated.  

The salient point for patent lawyers is that in order to avoid the s.70(2A) defence to a potential threats action, the substance of a potential counterclaim for invalidity should be communicated to the patentee at the earliest possible stage in a dispute, and any prior publications likely to invalidate the patent should be identified to the patentee.  Naturally, this may have the further beneficial effect of precipitating an early settlement.

ELA Consultation Paper

This article first appeared in International Union Rights volume 16 issue 2 2009 http://www.ictur.org/

In 1974 the Conservative Government lost the general election and the Industrial Relations Act (IRA) 1971 was repealed by the incoming Labour Government. From 1979-97 the Conservative Government adopted a step by step approach to restructuring collective labour law. Over 18 years the Conservative Government embarked on a permanent revolution publishing 7 Green Papers, 6 White Papers, 1 Charter, revoked the 1946 House of Commons Fair Wages Resolution and the 1972 Industrial Relations Code of Practice, and enacted 9 Acts of Parliament. Statutory support for a liberty to organise ended in 1980 with the repeal of the statutory recognition procedure in the Employment Protection Act (EPA) 1975 and the passing of legislation making pre-entry and post-entry closed shops unlawful.

From 1990 onwards (if not earlier) the TUC warmed to the concept of a policy of phased recognition leading to full recognition which crystallised in the 1995 TUC document Your Voice at Work. It proposed three broad new rights: (i) a universal right to representation and the right of unions to organise and have access to the workplace and protection for individuals against victimisation; (ii) consultation rights when 10% of the employees were union members; and (iii) collective bargaining rights if a majority in a ballot, or some other means of surveying opinion, wanted collective bargaining rights. The right of representation was confined to a recognised union if there was one. By 1997 the TUC had implicitly accepted the Conservative Government's restrictions on workers' liberty to associate and liberty to strike but was in favour of a limited liberty for workers to organise. This article deals with the New Labour Government and workers' liberty to organise.

The May 1998 Fairness at Work White Paper contained a proposed right to accompaniment. This alarmed The Financial Times which in an editorial dated 22 May 1998 said that "... any union member ... will have the right to union representation during grievance or disciplinary procedures. That last ... provides the unions with a toe-hold in any company in the land, and the CBI is right ... that ... it should only apply to disciplinary matters, not run of the mill grievances. It could prove a powerful recruiting sergeant for the unions ...". Barrie Clements in the Independent  on 11 July 1998 confirmed that the CBI, the main employers' organisation, were concerned that where unions were not recognised they could prevail on their members to register grievances on pay which, with sufficient numbers, could become a collective wage claim.

The Government took the CBI's concerns into account in the Employment Relations Act (ERA) which came into force in July 1999. As the Employment Bill went through Parliament the right to representation was whittled down by defining a grievance as a duty owed by an employer to a worker, e.g. a statutory entitlement to equal pay. This means that employees cannot raise a grievance over pay unless they have a contractual or statutory right to such a pay rise. There is a right to accompaniment by an employed union official, or a certified lay union official employed by that employer, which came into came into force in September 2000. Compensation for a breach of this right is up to two weeks wages capped at £350 a week from 1 February 2009. This is derisory compensation. Crucially, the right to accompaniment is a union right which is not dependent on an employer recognising a union. However, since 2000 the Government has introduced Regulations on flexible working and age and in both cases the right to be accompanied has been confined to a fellow worker and the reference to union representation omitted.

The ERA 1999 is the third attempt at statutory recognition. This current version has more in common with the IRA 1971 than the EPA 1975 and like statutory recognition in the United States it incorporates employer free speech rights (i.e the ability of employers and their agents such as employment "consultants" the Burke Group, to campaign against union recognition). Legitimate campaigning activity includes threatening to shut the company if the workers vote in favour. The procedure gives employers the right to choose the workers' union. The level of support for the workers' choice is irrelevant if the employer has helped to create and recognise a dependent "union" (i.e. News International's recognition of the News International Staff Association). Alternatively, an employer can recognise an unrepresentative independent union with no or very few members in that company.

The National Union of Journalists' application for recognition by the Sports Division of Mirror Group Newspapers Ltd was rejected as the company recognised an association with just one member. The Central Arbitration Committee (CAC) found that over half the journalists were in the NUJ. The NUJ's appeals to the High Court and Court of Appeal were rejected. If the CAC declares that a union is recognised then the employer has to engage in a dialogue with the union through a bargaining procedure. The employer is not obliged to agree to changes to terms and conditions of employment (i.e. pay, hours or holidays). There is no recourse to arbitration unlike the EPA 1975. Even with a legally enforceable contract the obligation on the employer to negotiate is purely procedural. The employer's ability to negotiate different terms with individuals is safeguarded by paragraph 18 of the Trade Union Recognition (Method of Collective Bargaining) Order 2000. Employers have a statutory right to contract with individual workers to the detriment of collective workers' power.

The Government published a consultation paper entitled a Review of the ERA 1999 in February 2003 and proposed that section 146(3) of Trade Union Labour Relations (Consolidation) Act (TULR(C)A) 1992 (the Ullswater amendment) should be repealed and the law amended to "... to specify that the entering of individualised contracts would not constitute unlawful union discrimination against those union members not offered them, provided there is no pre-condition in the contracts to relinquish union representation...". There was protection for the bare right to be a union member but nothing more (i.e. no protection for union negotiated collective agreements). The Review dealt with the judgment of the European Court of Human Rights (ECHR) in the Wilson & Palmer cases). The ECHR at paragraph 42 of its judgment said that "A trade union must thus be free to strive for the protection of its members' interests, and the individual members have a right, in order to protect their interests, that the trade union should be heard ...". At paragraph 46 the Court continued "Furthermore, it is of the essence of the right to join a trade union for the protection of their interests that employees should be free to instruct or permit the union to make representations to their employer or to take action in support of their interests on their behalf. If workers are prevented from so doing, their freedom to belong to a trade union, for the protection of their interests, becomes illusory. It is the role of the State to ensure that trade union members are not prevented or restrained from using their union to represent them in attempts to regulate their relations with their employers."

The Government's response to this judgment was to ignore it. The Review said (page 65, paragraph 3.17) that "The judgment refers to the right for the union "to be heard", which the Court views as inherent to Article 11 ... However, the Court has never expressed any view on what the right implies as a minimum. It has certainly never stated that the right to be heard requires the employer to respond to the points a union might make ... Under current UK law, unions can exercise their right to be heard by a number of means, including the freedom to be recognised or seek recognition ... and generally to make representations to the employer. These and other arrangements guarantee the right to be heard implied by Article 11" (i.e. Article 11 of the European Convention on Human Rights and Fundamental Freedoms and the Human Rights Act 1998).

However, new Regulations under the Employment Act (EA) 2002 came into force in October 2004 which require employers to respond to collective grievances but statutory collective grievances can only be raised by independent recognised unions and employee representatives recognised by an employer, i.e. these Regulations exclude independent unrecognised unions. The 2004 Regulations did not extend the ERA 1999 right of the unrecognised union to accompany an individual into a collective right to raise a grievance on behalf of its members. The EA 2002 and the accompanying Regulations will be repealed in April 2009. That means that the opportunity to challenge these Regulations on the grounds that they are incompatible with the ECHR decision in Wilson & Palmer will be lost.

 FUTURE PROSPECTS

Trade union membership has dramatically declined since 1979. In 1980 the Certification Officer (CO) said that here were 13,212,354 union members. In 1998 the CO said that the 1997 figure was 7,938,213. The CO figure for 2006-7 was 7,602,842. Since 1997 trade union membership has stagnated in contrast to the growth of union membership during the 1975-9 Labour Government. The Government's Labour Force Survey figures show 6,911,000 union members in 1997 and 6,677,000 in 2005. The density of union membership in Autumn 1997 was 27.5% and 26.2% in Autumn 2005. In Autumn 2005 less than one in five (17.5%) private sector employees were union members but almost three in five (58.6%) public sector employees were union members. The marked difference in the density of private and public sector trade union membership is partly attributable to the fact that union recognition is the norm in the public sector. In contrast in much of the private sector the unions have no legitimacy.  Private sector employers have a veto on voluntary union recognition and even with a declaration of statutory recognition by the CAC they only have to go through a negotiating procedure that covers pay, hours and holidays.

There is tripartisan (New Labour, Conservative and Liberal Democrat) party political support for the status quo. The TUC also appears to be broadly satisfied with current collective labour law and shows no appetite for change. The indications are that a future Conservative Government will not make significant changes to collective labour law. Arguably, with the enactment of the ERA 1999 statutory recognition procedure the objectives of the IRA 1971 have been achieved. Over the next 18 months to 2 years or more the impact of the financial crisis and economic recession on employment levels and trade union membership is likely to be negative. The TUC could campaign for a liberty for workers to join and be collectively represented by a union of their choice which, if achieved, would be a powerful organising tool amongst private sector workers but there appears to be no trade union interest in pursuing such an objective and so union membership in the private sector is likely to continue its steady decline.

Walkers were led by the Lord Chief Justice, the Master of the Rolls and the heads of all three branches of the legal profession.

The Attorney General had commented,

"Free legal advice agencies provide a tremendous service to people in need of help with housing, debt, benefits, community care and other areas of social welfare law and I'm delighted that a thousand more people have joined the walk this year.  Please do your very best to raise sponsorship between now and then".
The Rt. Hon the Baroness Scotland of Asthal Q.C.
H.M. Attorney General

 7 New Square would like to thank all those that supported and sponsored the team. 

To give effect to this obligation, the Scottish Parliament enacted the Glasgow Commonwealth Games Act 2008. This provided certain laws to restrict ambush marketing by intrusion and certain forms of association (for example, the ban on street trading (ss. 2 to 9); the ban on advertising (ss. 10 to 16) and the restrictions on ticket touting (ss. 17 to 20)). However, as it is an Act of the Scottish Parliament it cannot include provisions in relation to intellectual property matters as these are reserved to Westminster (under the Scotland Act 1998). Instead, it is proposed that a statutory instrument will be made under section 104 of the Scotland Act 1998, which enables Minister to make such delegated legislation “as the person making the legislation considers necessary or expedient in consequence of any provision made by or under any Act of the Scottish Parliament…”.

It is an interesting point of public law whether any order under section 104 can be used to create a new quasi intellectual property right over the entirety of the United Kingdom, rather than just Scotland. It might be asked, how can it be expedient to make wide ranging significant and important legislation extending to England where the basic legislation relates only to Scotland? If this proposition were correct it would enable the Government to extend the effect of many Acts of the Scottish Parliament to the rest of the United Kingdom by enacting secondary legislation; a cynic might see this as reversing the devolution settlement.

The proposed new association right for the Glasgow Commonwealth Games will closely follow that granted under Schedule 4 to the London Olympic and Paralympic Games Act 2006. However, there is no protection granted to the Commonwealth insignia as provided to that for the Olympics and Paralympics under the Olympic Symbol (Protection, etc) Act 1995. Accordingly, even where a relevant insignia is used it will be necessary to go on to prove that an association to the Games was made.

The consultation notice suggests that the new Glasgow Commonwealth Games association right and the London Olympics association right will be the same in all significant respects. This means many of the problems identified with that legislation (see Phillip Johnson, Ambush Marketing: A Practical Guide to a Sporting Event (Sweet and Maxwell, 2007), ch 5) will be extended to new situations. Some additional issues which faces the Commonwealth Games, but not the Olympics, are that it has a lower profile and so the relevant public are less likely to draw the association; that the word “Commonwealth” has many uses outside the context of the Games (whereas the Olympics has very few). This would enable marketers and advertisers to make associations with the Commonwealth, rather than associate with the Commonwealth Games itself, and in so doing facilitate an effective ambush.

The actual drafting of this Order and exactly how the rights fit together is now awaited with baited breath.

The Cabinet Office unsuccessfully appealed this decision to the Information Tribunal. It suggested that the information should not be disclosed because it would affect relations with foreign nations (FOIA s. 27(1)) and that it related to the formulation or development of government policy and Ministerial communications (FOIA s. 35(1)). Both of these exceptions apply only where in the circumstances of the case, the public interest in maintaining the exemption outweighed the public interest in disclosing the information (FOIA s. 2(2)(b)).

The Tribunal examined the history of the rule protecting the confidentiality of cabinet debates and collective responsibility. It agreed that such responsibility has considerable benefits in terms of good decision making and that confidentiality enables frank and open discussion by ministers. It further thought that those benefits might be lost or severely reduced where minutes of Cabinet discussions were disclosed prematurely or without proper examination of the public interest factors connected to disclosure. The Tribunal believed that in this particular case the public interest in disclosure outweighed the reasons for confidentiality. This was on the basis that the particular decision was momentous both nationally and internationally, was divisive within the Cabinet and that there had been some disclosures of what was said at that meeting by former ministers and during the extensive public inquires. It also felt that the public interest was satisfied because the conclusions of the Attorney-General had been criticised and, more importantly, that the initial advice was not disclosed to the cabinet at the time the decision was made.

The Tribunal's decision is important in terms the continuing debate over the military action in Iraq, but it is unlikely to have a much wider significance. The Tribunal not only made it very clear that although the nature of the cabinet confidentially had evolved, it was still important. In this case, disclosure was appropriate because of the intensive and continuing public debate over this particular cabinet meeting. Few, if any, other meetings are likely to attract similar levels of scrutiny. The Tribunal's decision therefore merely clarifies that cabinet confidentially is not absolute, but this in itself if hardly surprising. After all, what the Tribunal did not (and probably could not) say is that the real threat to collective responsibility and confidentiality is not the Freedom of Information Act 2000, but former Cabinet ministers who are eager to rapidly publish memoirs that are full of juicy revelations about what "really" happened.