A total of 56 Unite members at a South Yorkshire firm are set to receive ‘compensation’ payments of up to £7,600 each, after bosses tried to by-pass their recognised union and put a pay offer directly to individuals which included changes to their terms of employment.
Kostal UK Ltd, based near Rotherham, faces a bill that could reach £425,000, after an employment tribunal ruled that the German-owned company had breached the 1992 Trade Union and Labour Relations (Consolidation) Act.
Unite which represented members in the unlawful inducement claims, hailed the tribunal verdict as ‘a landmark victory for workers against managements who don’t play by the legal rules and seek to bypass the union’.
In November 2014, the majority of the 700 workers at the company, which makes advanced electronic equipment for the car industry, voted in favour of Unite being their recognised union for collective bargaining purposes. A recognition agreement was then signed with the company.
In November 2015, a pay offer of two percent for the year 2016 and a £270 Christmas bonus was put to union members and rejected by a large margin of 80 per cent in a consultative ballot.
The union then said that rather than continuing with the pay negotiations as it should, the company wrote to individual employees urging them to accept the offer and change their terms of employment, otherwise they would lose their Christmas bonus of £270 each. This offer was repeated in January 2016.
Unite Legal Services brought claims on behalf of 57 members to whom the offer was made and the judgment following the Sheffield hearing in November 2016 was received last week.
In the judgment, Employment Judge Little said, “We take the view that it is not permissible for an employer to abandon collective negotiation when it does not like the result of a ballot.
“If there is a recognition agreement, which includes collective bargaining, the employer cannot drop in and out of the collective process as and when it suits its purpose.”
Unite regional officer Simon Coop called it a “landmark ruling” that shows that “managements can’t play fast-and-loose with the law when there are collective bargaining arrangements with Unite.
“Our members are due compensation of £3,800 for each offer made by the company,” he said.
“If two offers were made, the member should receive £7,600. Payments are due to 56 of the 57 members that took part in the claim as one member settled his claim prior to the hearing. The level of compensation could reach £425,000.
“It shows the benefit of union membership that will fight your corner to the very end, industrially, politically and legally, even when things look very dire,” he added.
“It was disappointing that we had to bring these claims to the employment tribunal in the first place, but we felt it was essential that we defended the collective bargaining process. I am delighted that the tribunal accepted our arguments and agreed with us that the employer had crossed a line.
“This is a victory for the solidarity our members showed when being put under intense management pressure – and should send out a strong message to other employers considering such underhand tactics.”
It was not until November 2016, all Kostal UK employees covered under the recognition and procedural agreement received a pay increase of two per cent on their basic annual salary backdated to January 1, 2016.
Unite has contacted the company seeking pay-out of the award, but if agreement can’t be reached the employment tribunal will meet on February 24 to arbitrate.