A small group of employees employed by the supermarket giant Lidl have won the right to trade union representation.
Although they only make up 1.2% of the company’s workforce in Great Britain, the Court of Appeal has ruled that the warehouse operatives at one of Lidl’s distributions centers are an appropriate ‘bargaining unit’.
Trade unions may represent groups of employees, which are typically called “bargaining units”. However before a trade union can negotiate employees’ pay, hours and holidays, they must be recognised.
The trade union can submit a written request to the employer to recognise them.
If the employer accepts the request, the union will be recognised.
If the employer refuses the request, the trade union can apply for statutory recognition from the Central Arbitration Committee (CAC), who can make legally binding decisions. It is up to the CAC to decide whether to grant recognition to the union or not.
The German-owned supermarket giant Lidl has a workforce of 18,000 in Great Britain and has nine distribution centres across the country. It does not recognise any trade unions for any of its employees in Great Britain.
The GMB union applied for statutory recognition for a bargaining unit, made up of warehouse operatives who worked at the Bridgend distribution centre. This bargaining unit made up 1.2% of the total workforce.
Warehouse operatives are classified as “category 6” staff, along with others such as store workers and junior office workers. Regardless of their role or location of work, their contractual terms and conditions are broadly the same.
Lidl and the GMB union did not agree on the bargaining unit, therefore the CAC had to decide whether the proposed bargaining unit was appropriate.
When making a decision, the CAC needs to take into account the need for the unit to be compatible with effective management and consider
- the views of the employer and the union
- current 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 and of any other employees of the employer whom the CAC considers relevant
- the location of workers.
Lidl raised the point that the bargaining unit was only made up of 1.2% of the total workforce, thus they considered the proposed bargaining unit to be too small. They argued it was neither efficient nor compatible with effective management. If the bargaining unit was approved, the “single status” of terms and conditions for category 6 staff would be ruined.
The CAC ruled that the proposed bargaining unit was appropriate.
It noted that although there was a single pay scale in operation for all category 6 workers, they had made exemptions to the general rule. Therefore they concluded that Lidl could “accommodate additional allowances within its structures and payroll systems”.
They said that warehouse operatives were “treated as a distinct group with a separate contract”, are “easily identifiable” and based at one location. It would be the only bargaining unit in Lidl and there was no evidence that there was any demand for other units to be created.
Lidl issued proceedings for judicial review of the CAC’s decision.
Court of Appeal’s decision
The case was brought before the Court of Appeal. Although they conceded that it is undesirable for employers to have to negotiate in more than one forum and with more than one trade union for parts of their workforce who are not fundamentally different, they dismissed the claim.
If you would like to discuss any issues related to collective bargaining, contact your Employment Law Adviser for support and guidance.