Industrial action 1: the contract of employment
The freedom to take industrial action is now circumscribed by a highly developed statutory framework. However, in the first of a series of four Guidance Notes, we go "back to basics" and look at the legal effects of industrial action on the individual contract of employment.
"The freedom of employees to combine and to withdraw their labour is their ultimate safeguard against the inherent imbalance of power between the employer and the individual employee. This freedom has come to be accepted as a hallmark of a free society."
(From the Green Paper Trade Union Immunities, 1981, Cmnd 8128)
In 1993 we saw the lowest number of work stoppages arising from industrial disputes ever recorded in the United Kingdom, whilst the number of working days lost was the second lowest on record1. These statistics reflect trends observed in a 1990 study2, which reported that "there was a very substantial and widespread fall in the extent of industrial action in the second half of the 1980s". This decline affected all forms of industrial action, and "contrary to what has sometimes been assumed, non-strike forms of action were not being substituted for strike action".
Role of the law
The Government believes that the decline in industrial action is the clearest evidence of a transformation of, and improvement in, UK industrial relations. It argues that, while changing patterns of employment and trade union membership have been important factors in this process, "changes to the law governing industrial relations since 1979 have been of fundamental importance"3.
There can be little doubt that the framework of law relating specifically to industrial action has undergone a radical overhaul in this period. In some seven major pieces of legislation, significant restrictions have been placed on the purposes for which industrial action may lawfully be organised. There are now detailed procedural rules with which trade unions must comply before calling on their members to take such action. Union responsibility for the actions of members has been extended, so that at a number of points statutory provisions effectively ask unions to choose between supporting those members, or protecting their funds against legal action and exposing members to selective dismissal with no redress to industrial tribunals.
It now seems possible that this process of reform is, at least for the present, coming to an end. The Secretary of State for Employment, Michael Portillo, is recently reported to have said that a further round of legislation on collective industrial relations has been ruled out because industrial relations are "very good" 4. He apparently dismissed suggestions that the Government was intending to legislate to prevent the disruption of essential services, and felt that the privatisation process was at the moment the best way to deal with such problems.
It would therefore seem to be a good time to review the current state of the law on industrial action. The logical starting point for an analysis of this complex and controversial area is the impact of industrial action on the individual contract of employment.
No "right to strike"?
Individual employees who participate in a strike or industrial action short of a strike will almost inevitably be in breach of their contracts of employment. They will thus generally be exposed to sanctions by their employers, ranging from deductions from pay to summary dismissal (if the action amounts to a sufficiently serious breach of contract). For this reason there may be some justification in saying that there is no "right to strike" in the UK, since there is no legal protection provided for the individual against the contractual consequences of participating in industrial action. In addition, a breach of contractual duties can in certain circumstances constitute a criminal offence (see the box on p.4), and it is the individual's breach of contract which normally provides the basis for the potential civil legal liability of those who organise industrial action, including trade unions.
Strike action
Domestic law contains no clear or uniform definition of what constitutes a "strike". Section 246 of the Trade Union and Labour Relations Act 1992 (the TULR(C)A) defines a strike as "any concerted stoppage of work". This open-ended definition applies, however, only in the context of those provisions in the TULR(C)A which regulate the organisation of industrial action (see parts 3 and 4 of this series), and to the question of whether industrial tribunals have jurisdiction to hear unfair dismissal complaints lodged by alleged strikers (see part 2).
Similarly, the definition of a "strike" contained in Schedule 13, para. 24 of the Employment Protection (Consolidation) Act 1978 (the EP(C)A) applies solely to the computation of the period of continuous employment under that Act, together with its redundancy payments provisions (see part 2). This latter definition is limited to a concerted stoppage of work done as a means to compelling an employer (whether or not the employees' own employer) to accept or not to accept terms and conditions of, or affecting, employment. It does not therefore cover a "political" or protest strike which is unrelated to employment terms.
More generally, in Tramp Shipping Corporation v Greenwich Marine Inc, Lord Denning addressed the possible purposes for which strike action may be taken: "a strike is a concerted stoppage of work by men done with a view to improving their wages and conditions, or giving vent to a grievance or making a protest about something or other, or supporting or sympathising with other workmen in such endeavour. It is distinct from a stoppage which is brought about by an external event such as a bomb scare or by apprehension of danger." Lord Justice Stephenson added that a strike must be intended to achieve or call attention to something, and includes stoppages called in relation to "political" issues.
Strikes are invariably a breach of contract
Strike action which involves an indefinite cessation of work will invariably be regarded by the courts and tribunals as a serious - that is, "repudiatory" - breach of contract by employees. This is because such a strike involves "a settled, confirmed and continued intention on the part of the employee not to do any of the work which under his contract he had engaged to do: which was the whole purpose of the contract" (Simmons v Hoover Ltd).
Indeed, work stoppages of any duration, however brief, will normally be treated in a similar manner. This will include one-day or half-day strikes and even shorter stoppages. For example, it has been held that holding a one-hour meeting during working hours without an employer's consent can amount to a repudiatory breach of contract (Rasool and others v Hepworth Pipe Co Ltd (No.1)). To this extent, strikes or work stoppages are characterised as a collective form of gross industrial misconduct, in which the employees involved disregard the fundamental purpose of their contracts, or, as in the Rasool case, as collective acts of wilful disobedience of the employer's lawful and reasonable orders (although the disobedience in Rasool was subsequently held not to amount to "strike" or "other industrial action" for unfair dismissal purposes - see part 2 of this series).
Effect of strike notice?
The position may be different where employees or their representatives give the employer notice of a strike. Much, however, will depend upon the terms of that notice and the nature of the strike action to which it relates. If the notice relates to indefinite strike action and expressly purports to be notice of termination of employees' contracts - which means that it must be of at least the contractually-required length in all cases - there is in principle no breach of individual contracts.
But strike notices commonly refer merely to "a withdrawal of labour" from a certain date. The question which then arises is whether such a notice is to be treated as an express or implied notice of termination (with the ensuing strike thus being "lawful"), or as notice of an intended breach of contract.
The approach taken by courts and tribunals to this issue has been conditioned by the view that employees who give strike notice do not in reality intend to give up their jobs, but simply wish to put pressure on their employer to improve terms and conditions of employment or to secure some other benefit or advantage. In the words of Lord Devlin in Rookes v Barnard, "the object [is] to break the contract by withholding labour but keeping the contract alive for as long as the employer [will] tolerate the breach without exercising their right of rescission [that is, the right to dismiss summarily]." A strike notice is thus generally perceived to be a notice of intended breach, and this view has been reinforced by the loss of individual employment protection rights which would follow if strikers were assumed to have resigned from employment (see Simmons v Hoover).
However, in Boxfoldia Ltd v National Graphical Association (1982), Mr Justice Saville recently refused to accept that there was any rule of law that this approach should be adopted in every case. It could not, he said, always be assumed that the party giving the notice wished the contract of employment to continue. In any given case, employees (or their representatives) "might consider that by actually terminating the contracts on due notice, greater or more effective pressure can be put upon the employers". There was a distinction between "wanting to continue with the existing but improved contracts of employment and wanting to continue (but with new contracts) the relationship of employer and employee."
Whether or not a strike notice was properly categorised as one giving notice of termination in accordance with the terms of employment contracts, said Saville J, depended "on the meaning and effect of the words used in the context in which they were used". In Boxfoldia itself, he held that a letter from the union to the employer, giving "14 days' notice of withdrawal of all NGA members' labour from the company", could not be so categorised. The letter did not purport to be written by the union as agent for the employees concerned, and did not communicate the employees' decision to terminate their contract or give on their behalf the appropriate notice of termination. Although the phrase "withdrawal of labour" was in itself theoretically capable of being read as notice of contractual termination, it could not sensibly bear that meaning in the present case.
In addition, Saville J noted that the NGA did not in any event have the authority to give contractual notices of termination on behalf of and as agent for its members. The union's rules contained no express authority to that effect, and authority to terminate individual contracts could not be implied from the union's general power under its rules to instruct members to strike or take other forms of industrial action and to publicise that instruction and communicate it to employers.
Two further points should be noted in relation to strike notices:
Action short of a strike
Most forms of industrial action short of a strike will also amount to a breach of the employment contract. Such action can take a variety of forms, but it most commonly involves a refusal to perform specific tasks or duties, or to handle certain goods (that is, "blacking"). If such tasks or duties fall within the employee's express or implied contractual obligations, any refusal to perform will constitute a breach. It is therefore critical to establish the extent of those legal obligations, and to distinguish them from voluntary and non-contractual aspects of the employment relationship.
Identifying contractual obligations
In relation to overtime, for example, whether or not an overtime ban amounts to a breach of contract depends on whether the employee is contractually obliged to work overtime if it is required by the employer. The mere fact that overtime has been offered and worked regularly over a period of time does not of itself render it a contractual obligation. It remains necessary to identify an express or implied term to that effect on normal contractual principles.
In Secretary of State for Employment v Associated Society of Locomotive Engineers and Firemen and others (No.2) (the ASLEF case), the Court of Appeal held that a ban on rest-day and Sunday working did not in itself breach individual contracts, since such working was purely voluntary. However, a ban on "rostered" overtime - whereby employees worked a nine-hour shift, with eight hours paid at basic rates and one hour at overtime rates - breached an express contractual obligation.
Note: A ban on purely voluntary overtime may nevertheless be regarded as "other industrial action" for statutory unfair dismissal purposes, even though it does not amount to a breach of contract (see part 2 of this series).
Similarly, if industrial action takes the form of a refusal to cooperate with the introduction of new working methods (eg new technology) in the workplace, the question will be: was the employer contractually entitled to introduce the changes? Employees will generally be expected to adapt to new working methods and techniques introduced in the course of their employment (and which otherwise fall within existing job descriptions and/or duties), provided that they are given any necessary training or retraining and that any new skills required are not so "esoteric" that it would be unreasonable to expect the employees to acquire them (Cresswell v Board of Inland Revenue).
Furthermore, the courts have proved willing to imply wide-ranging contractual obligations by reference to the type of employment involved. In Sim v Rotherham Metropolitan Borough Council, for example, the High Court found that the contracts of employment of secondary-school teachers were "silent" as to whether they were under a contractual duty to cover for absent colleagues when asked to do so. It nevertheless identified an implied term to that effect by examining "the nature and scope of teachers' professional obligations as teachers", and holding that teachers had a contractual obligation to discharge their professional obligations towards their pupils and their school. On the other hand, it was accepted by the parties that those professional obligations did not in that case require teachers to supervise school meals.
In exceptional circumstances, there may be no breach of contract because industrial action is effectively undertaken with the employer's consent. For example, in D C Thomson & Co Ltd v Deakin, a trade union warned an employer that its employees might not be prepared to handle or deliver paper destined for D C Thomson. The employer consequently informed Thomson that it would no longer deliver paper under the terms of their commercial contract. In the Court of Appeal, Sir Raymond Evershed expressed the opinion that there was no evidence of any breach of employment contracts by any of the employees, because their employer had decided not to order them either to load or to drive paper for Thomson.
"Working to rule"
Rather than refusing to perform particular tasks or duties, employees may engage in more diffuse forms of industrial action such as a "work to rule" or contract, withdrawal of goodwill/cooperation or "go-slow". This type of action is characterised by a claim on the part of employees that they are continuing to perform all of their specific contractual tasks, obligations and duties, and that there can therefore be no breach of contract. The courts, however, have identified broad implied duties of "good faith" or cooperation underpinning the employment contract, which effectively ensure that such action will in most circumstances amount to a breach (and often a repudiatory breach). In the development of such terms, the focus has been on the employees' purpose in taking concerted action.
In the ASLEF case (see above), the action called by rail unions also included a campaign of working strictly to the rules contained in the employer's rule book. Those rules - which were found by the Court of Appeal not to form a part of individual contracts - gave detailed instructions to employees as to how to do their work. In particular, they contained instructions relating to safety matters, and ensuring that railway engines were in "proper order" before use. The work to rule - which entailed, for example, drivers taking rather longer than usual to check their engines - contributed to a serious dislocation of rail services.
According to Lord Denning, the action was intended, and was understood by union members, to mean that each employee should "keep to the rules of your employment to the very letter, but, whilst doing so, do your utmost to disrupt the undertaking". Lord Denning agreed that employees were "not bound positively" to do more for their employer than their contracts required. They could withdraw their "goodwill" at any time. What they could not do, however, was "wilfully obstruct" the employer as it went about its business. Such wilful disruption was, he said, a significant breach of contract.
Lord Justice Buckley, on the other hand, found that the work to rule breached a positive implied obligation "to serve the employer faithfully within the requirements of the contract". The contracts of employment between the employer and its employees were entered into "as part of the [employer's] commercial activity", and action which was intended to frustrate that commercial object amounted to a breach of the implied term identified.
In yet another formulation, Lord Justice Roskill said that in entering into contracts of employment each party must have assumed "as rational beings" that the employee "would never seek so to interpret and act upon the rules as to disrupt the entire railway system". Accordingly, he "had no hesitation" in implying a term that "each employee will not, in obeying his lawful instructions, seek to obey them in a wholly unreasonable way which has the effect of disrupting the system, the efficient running of which he is employed to ensure."
Go-slows
The importance of the employees' purpose in taking disruptive action is again emphasised in the Privy Council's decision in General Engineering Services Ltd v Kingston and St Andrew Corporation. In that case, firefighters were in dispute with their employer and operating a "go-slow". During the dispute, a building and its contents were destroyed by fire when it took a fire appliance 17 minutes to cover a distance which would normally have taken about 3.5 minutes. The Privy Council held that the firefighters had not been acting in the course of their employment, and their employer was not therefore vicariously liable for the ensuing damage. The firefighters' unauthorised and wrongful act was, said Lord Ackner, "a wrongful repudiation of an essential obligation of their contract of employment". Their action "was not in furtherance of their employer's business", but "was in furtherance of their industrial dispute, designed to bring pressure to bear on their employer to satisfy their demands, by not extinguishing fires until it was too late to save the property."
Withdrawal of goodwill
The line of reasoning evident in the ASLEF case has been further developed by the Court of Appeal in Ticehurst and Thompson v British Telecommunications plc. Mrs Ticehurst was a manager in charge of 40 staff who took part in a general "withdrawal of goodwill" organised by her union, the Society of Telecom Executives. That action involved, among other things, working strictly to conditioned hours, refusing to undertake temporary advancement, and refusing to accept new work, procedures or practices without the union's agreement. More generally, the union issued guidance to the effect that each member should, when faced with a task falling within his or her job description, consider how much choice he or she had in carrying out the task and which option would cause BT the most inconvenience.
Giving the judgment of the Court, Lord Justice Ralph Gibson adopted the formulation of Buckley LJ in the ASLEF case, and found that Mrs Ticehurst's contract of employment contained an implied term of faithful service within the requirements of the contract. It was, he said, "necessary to imply such a term in the case of a manager who is given charge of the work of other employees and who must therefore necessarily be entrusted to exercise her judgment and discretion in giving instructions to others and in supervising their work." Such a discretion, if the contract was to work properly, had to be "exercised faithfully in the interests of the employers".
Does action have to be effective?
Crucially, in Ticehurst, Gibson LJ rejected an argument that there could be no breach of good faith unless the disruption intended by the industrial action was achieved, whether to the extent of rendering the business unmanageable or to some other level of disruption. The term was, he said, breached when the employee did an act, which was discretionary in contractual terms, "not in honest exercise of choice or discretion for the faithful performance of her work but in order to disrupt the employer's business or to cause the most inconvenience that can be caused."
On the other hand, the Court did not consider the position which would arise "if the ill-intentioned course of conduct is shown to have had no significant consequences adverse to the employer and to be incapable of causing such adverse consequences in the future" (our emphasis). The general tenor of the decision leads us to think that the courts would still find a breach of contract in such circumstances, but that the breach might not perhaps be regarded as significant or fundamental (that is, repudiatory).
An employer faced with strike or other industrial action which is allegedly in breach of contract has a number of possible options. These options do not, however, include obtaining a court order which directly or indirectly requires the employee to resume normal working. In addition to the general reluctance of the courts to enforce contracts involving personal services, s.236 of the TULR(C)A provides that a court cannot compel an employee to do any work, or attend at any place for work, by ordering specific performance of an employment contract or an injunction restraining a breach or threatened breach of such a contract.
The remaining possibilities are as follows:
Each of these potential strategies is discussed in turn below.
Summary dismissal
If industrial action is sufficiently serious to amount to a "repudiatory" breach of contract, an employer has the option of lawfully dismissing employees without notice (or without proper notice). As we have already seen, a strike will invariably be regarded as giving the employer this option, and much industrial action short of a strike is likely to be similarly categorised.
It has nevertheless been suggested that only a "real" strike is repudiatory, and that a strike in opposition to demands by an employer which are themselves in repudiatory breach of contract should not be so regarded (see, for example, Simmons v Hoover). This view has not, however, generally found favour with the courts and tribunals. They have in particular rejected the proposition that employees who go on strike in such circumstances "accept" the employer's breach, and thereby lawfully terminate their contracts. Once again, the assumption is made that the whole point of employees withholding labour is "so that the existing contract can be put right, so that grievances can be remedied, so that after a period in which they are on strike, management will agree to their demands" (Wilkins and others v Cantrell and Cochrane (GB) Ltd).
This assumption nevertheless overlooks the possibility that employees who strike in response to their employer's actions may in fact intend or wish to terminate their contracts, either with or without notice (see Boxfoldia, above). Indeed, if this analysis of "mass constructive dismissals" were accepted, it seems possible that employees would retain the right both to sue in the civil courts for damages for wrongful dismissal and to complain of unfair dismissal before an industrial tribunal (see part 2 of this series). For this to occur, however, it is likely that each employee would have to indicate that he or she wished to "accept" the employer's breach, or there would have to be clear evidence that the employees' trade union or other representative had authority to accept the breach on their behalf (see Boxfoldia).
If industrial action is not sufficiently serious to amount to a repudiatory breach of contract, the employer must give the contractually required notice to each employee if it wishes to dismiss lawfully (that is, without facing claims for wrongful dismissal). The courts are extremely unlikely to grant employees any form of injunction or specific performance to prevent a wrongful dismissal in the context of actual or threatened industrial action (see Chappell v Times Newspapers Ltd).
Suing for damages
An employer may seek damages in the civil courts for any losses which flow from an employee's breach of contract in participating in industrial action, irrespective of whether the breach is repudiatory. Such actions are rare, but raise the interesting question of how damages are to be quantified. The aim of any award should be to put the employer back into the position it would have been in had the contract been properly performed. In the context of industrial action, the problem lies in identifying the specific loss caused by the individual employee's own breach. The courts have suggested two potential measures of employer loss:
Deductions from wages
Rather than adopting either (or both) of the courses of action just outlined, employers may wish to limit their losses and/or put pressure on employees by making deductions from pay, or on occasion by refusing to make any payment whatsoever, whilst industrial action persists. Although the legal basis for these "self-help" remedies is somewhat confused, the onus will then be on the employee to challenge the legality or amount of any deduction in the county court, High Court or an industrial tribunal.
"The courts are not competent to determine whether a strike or other form of industrial action is justified or malicious, wise or foolish, provoked or exploited, beneficial or damaging; history has proved that any such determination is speculative and liable to be unsound."
(Per Lord Templeman in Miles v Wakefield Metropolitan District Council)
The latter forum can, of course, only hear breach of contract claims under their recently acquired contractual jurisdiction if the claim was outstanding on the termination of an employee's employment, and is for less than £25,000. Tribunals have no jurisdiction to hear claims about deductions made from wages on account of a worker's participation in strike or other industrial action under the Wages Act 1986 (s.1(5)(e) of the Act - see Sunderland Polytechnic v Evans and Wages Act 1986: The Story So Far).
The following guidance on the employer's right to make deductions during industrial action can be derived from the cases:
For example, in Cresswell employees refused to operate a new computerised system for administering PAYE. The employer, for its part, made it clear that it would not allow the employees to work manually (as they desired), and would not pay them as long as they refused to operate the new system. On the employees' action for various declarations of their contractual rights, the High Court held that the employer had the contractual right to insist that employees adopt the new mode of carrying out their tasks, and was entitled to refuse to pay them until they did so.
The council deducted 3/37ths of Mr Miles's salary in respect of each Saturday of the industrial action, and he sought to recover those sums (totalling £774) in a High Court action. The High Court dismissed his claim, but the Court of Appeal allowed an appeal, on the basis that Mr Miles was the holder of an office established under statute and the relevant legislation did not permit deductions.
Allowing the council's further appeal, the House of Lords said that Mr Miles's position was analogous to that of an employee under a contract of employment. If an employee refused to perform the full range of duties that could be required under his or her contract, the employer was entitled to refuse any partial performance. During any period of defective performance the employee was to be treated as if he or she was refusing to work at all, or as voluntarily absent from work. Given that wages and work were interdependent, in an action for the recovery of wages by an employee he or she had to "allege and prove that he [or she] worked or was willing to work" (our emphasis).
In the words of Lord Oliver of Aylmerton, the question which has to be asked is not so much whether an employer has a "right" to withhold wages from an employee who voluntarily absents himself or herself from work for the period of that absence (in Miles itself, Saturdays mornings), but "is the employee entitled to sue for and recover from his employer wages in respect of a period during which he has made it perfectly clear that he is not ready and willing to perform his own contractual obligations?".
The council responded by informing employees that they would be paid only if they were willing to work normally in accordance with their contracts. They were further informed that their presence on council premises would not be required until they were prepared to resume normal working and that, if they attended for work, any work done would "be regarded as unauthorised and undertaken ... in a purely voluntary capacity". Mr Wiluszynski did attend for work, and in fact carried out all of his normal duties other than answering members' enquiries. The industrial action lasted for five weeks, and when the dispute was over it took him only about 2.5-3 hours to clear the backlog of enquiries. The High Court upheld his consequent claim for five weeks' salary.
Allowing the council's appeal, the Court of Appeal confirmed that the principle established in Miles was applicable in the present case: "an employee who sues for remuneration under a contract of employment must aver and prove that he was ready and willing to discharge his own obligations under that contract (I disregard illness and other unavoidable events)," said Lord Justice Fox. The Court regarded the action taken by Mr Wiluszynski as a significant breach of contract. That being so, the council was entitled to say to Mr Wiluszynski "if you will not perform the full range of your contractual duties, including answering members' enquiries, you will not be paid and you should not attend for work. If you do attend for work, you will do so voluntarily."
This point was graphically illustrated in the Ticehurst case. We have already considered the nature of the "withdrawal of goodwill", and the consequent breach of contract found in that case. In addition to the withdrawal of goodwill, there was a rolling campaign of half- and one-day strikes. On her return to work after one of these strikes, Mrs Ticehurst was asked by BT to sign an undertaking to the effect that she would work normally in accordance with the terms of her contract "from now on", and that she would take "no further industrial action for the duration of the current dispute". When she refused to sign, she was sent home without pay. Substantially the same events occurred on each working day until the dispute was settled. A county court judge awarded Mrs Ticehurst £817.70 in wages due for the days on which she was not allowed to work.
Upholding BT's appeal against that decision, the Court of Appeal referred to both Miles and Wiluszynski, and held that Mrs Ticehurst had evinced an intention to continue to participate in the withdrawal of goodwill, and that BT was entitled - without either formally suspending her or terminating her contract - to send her home without pay while that situation persisted. Although the Court agreed that her refusal to sign the undertaking demanded by BT was neither an independent breach of contract nor a failure to obey a reasonable order, it said Mrs Ticehurst had taken an active part in the action before the campaign of strikes had begun. Furthermore, there was nothing in the evidence to suggest that the withdrawal of goodwill had at any time been suspended, or that Mrs Ticehurst had, by her words or conduct, separated or distanced herself from the action.
Note: The Court in Ticehurst also made the important point that an indication by an employee that he or she intends to take strike action if and when called upon to do so by his or her union, does not constitute a breach of contract which by itself would entitle an employer to refuse to permit the employee to work.
On the other hand, "a person is not treated by the law as having chosen to accept that which is forced down his throat despite his objections." Where an employee continues to work, courts will therefore "be concerned to see that the employer's expression of attitude was genuine and not a charade, and that there was no question of the employee having reasonably been confused or misled about this when he continued to work ... if the court is satisfied that the employer's pronouncements were genuine, that is, meant to be taken seriously ... then there can be no question of waiver or estoppel or the like arising from the mere fact that the employer acquires the benefit of the work which the employee insists on performing" (per Lord Justice Nicholls in Wiluszynski).
Thus, in Wilusynski itself, much of an estates officer's work was found to have been "self-generating", and the council had given relevant section heads instructions not to pass work to their staff. In addition, section heads had been instructed to give staff a daily warning that any work they did was voluntary, even though this ritual had apparently been treated as "something of a joke" by Mr Wiluszynski's section head, Mr Pulker. In the Court of Appeal's view, the council could not, for practical reasons, have been expected physically to exclude, or "lock out", the relevant staff from its premises, and Mr Wiluszynski had not been given any directions to work by the council's senior management. Mr Pulker's attitude was irrelevant, said the Court, because his position in the hierarchy was too low for his acts to be treated as acts of the council.
Alternatively, if the employer can be said to have accepted the deficient performance in full discharge of the employee's contractual obligations, the employee would on normal contractual principles be entitled to his or her full pay or salary.
The prevailing approach of the judiciary in such cases, however, attempts to balance the interests of employer and employee. For example, in Royle v Trafford Borough Council, Mr Royle taught a class of 31 pupils. In the context of a dispute over staffing, he refused to comply with an instruction from his school head to accept an additional five pupils in his class. Along with the actions of other teachers, this resulted in pupils being sent home, and the local education authority (LEA) was unable to fulfil its statutory duty to provide full-time education for children in the area. The LEA informed school heads that teachers who refused to teach in accordance with the head's instructions would not be paid "for the period or periods of time which they refuse to teach ... Such staff may remain on the school's premises if they wish to do so as it is not intended to suspend them from duty."
Mr Royle was consequently not paid for the entire six months of the dispute, despite the fact that he continued to report for work and teach his normal class. Upholding his claim for breach of contract in respect of lost salary, the High Court held that the council was not entitled to withhold the whole of his salary for the period of the dispute. Throughout that period the LEA had known of Mr Royle's imperfect performance of his contract, and had made available the facilities necessary for him to continue to teach a class of 31 pupils. It was clear that, in deciding not to suspend him from duty or treat each threatened breach of contract as a repudiation, the LEA had accepted "whatever duties he chose to perform". It had therefore "impliedly affirmed his contract."
However, Mr Justice Park said that Mr Royle would be entitled to his full salary only if he had "properly and fully performed his duties under the contract of employment". The Court therefore made a deduction from his compensation "representing the notional value of the services he has not rendered". This was calculated at 5/36ths of his salary, which the Court accepted was "a far from perfect assessment" (reflecting the pupils which Mr Royle had refused to teach).
So, in Sim itself, teachers had refused to cover for absent colleagues, and Scott J upheld deductions which reflected teachers' pay for each 35-minute period they refused to cover. The breaches of contract by teachers were of short duration and the damages attributable to them were correspondingly small in amount, but they were not nominal. They were, said Scott J, calculated to represent the loss caused to the employer.
The practical problem with this approach is that it effectively allows employers to make a very rough-and-ready calculation of their own "loss" or "damages", and leaves the onus on employees to challenge the legality or amount of any deduction. This difficulty is exacerbated for employees because it seems clear that the courts will refuse to grant mandatory injunctions forcing the employer to pay wages or salary at the interlocutory (that is, interim) stage of proceedings, particularly in the context of industrial disputes (see Jakeman v South West Thames Regional Health Authority and London Ambulance Service).
Employer "lock-outs"
In concluding the first part of our series, we briefly examine the possible contractual implications of an employer "lock-out". The definition and nature of a lock-out are considered further in part 2 of this series. For present purposes it is sufficient to note that a lock-out means that an employer suspends its operations or refuses to let its employees (or certain groups of employees) work "by way of pressure, protest or demonstration"5. It may usefully be regarded as the employer's equivalent of strike action.
If an employer institutes a lock-out, the effects on the contract of employment may be as follows:
If the former course of action is adopted, the employee's common law claim will effectively be for wrongful dismissal, with damages normally limited to the employee's proper notice period (and accrued benefits). In addition, a statutory unfair constructive dismissal complaint may well be effectively precluded where the employee is dismissed in the course of a lock-out (see part 2 of this series).
If, however, the employee keeps the contract alive, he or she will be able to sue for loss of wages and other benefits for the period of the lock-out, provided that he or she can show that he or she was ready and willing to work.
Industrial action and the contract of employment - main points to note
Breach of contract as a criminal offence
The general offence
It is a criminal offence under s.240 of the TULR(C)A to wilfully and maliciously break a contract of employment or hiring, either alone or in combination with others, knowing or having reasonable cause to believe that the probable consequences of so doing will be:
(a)to endanger human life or cause serious bodily injury; or
(b)expose valuable property, whether real or personal, to destruction or serious injury.
A person guilty of this offence is liable on summary conviction (before magistrates) to three months' imprisonment and/or a £500 fine. This provision does not apply to seafarers (but see comments below).
Specific offences - some examples
There are certain other offences which may further restrict the ability of particular groups of workers to take industrial action which amounts to a breach of contract or duty.
The latter offence specifically covers any person in the employment of the Post Office. Neither this offence, nor s.58 of the 1953 Act, "can be said to be obsolete" (see Gouriet v Union of Post Office Workers and others), although it has been judicially recognised that if such offences do apply they will impose unusually strict limits on the industrial action which can be taken by the workers affected. Indeed, "it might make most industrial action by them unlawful" (see Mercury Communications Ltd v Scott-Garner and the Post Office Engineering Union).
In this context, it is possible be that postal and telecommunications workers would be subject to the broadly defined offence contained in s.1 of the Interception of Communication Act 1985, of intentionally intercepting a communication in the course of its transmission by post or by means of a public telecommunications system.
"No-strike" agreements
There is a statutory presumption that a collective agreement (including a "no-strike" agreement) is not legally enforceable between the parties (that is employers and trade unions) at the collective level. That presumption can only be rebutted if the agreement is in writing, and contains a provision which (however expressed) states that the parties intend the agreement to be a legally enforceable contract (s.179 of the TULR(C)A). This is rare.
The provisions of a collective agreement may, however, have legal effect if they are expressly or impliedly incorporated into the contracts of employment of individual employees. Whether such incorporation takes place will in turn depend upon the intention of the parties to the employment contract, and whether particular provisions of the collective agreement are "apt" or "appropriate" for incorporation into individual contracts. In general, provisions which relate primarily to the relationship between the parties at the collective level - for example, collective disputes procedures - are likely to be inappropriate for incorporation, and this would militate against the incorporation of "no-strike" clauses.
In addition, s.180 of the TULR(C)A provides that any terms in a collective agreement which prohibit or restrict the right of workers to engage in a strike or other industrial action, or have the effect of prohibiting or restricting that right, cannot form part of any contract between a worker and his or her employer unless the following additional conditions are met:
IRLB guide to industrial action and the law
Part 1 : The contract of employment, covering the impact of industrial action on contracts of employment, employer responses to breaches of contract, and employer lock-outs.
Part 2 : Employment protection rights, including effect of industrial action on unfair dismissal rights, redundancy payments, guarantee payments and continuity of employment.
Part 3: Civil liability and industrial immunities, covering the industrial torts, trade union responsibility, the statutory immunities (including balloting requirements), and picketing.
Part 4 : Restraining industrial action, including injunction procedures, damages, trade union members' and citizens' rights to restrain action, and future directions for industrial action law.
Case list
Boxfoldia Ltd v National Graphical Association (1982) [1988] IRLR 383
Chappell v Times Newspapers Ltd [1975] IRLR 90
Cresswell v Board of Inland Revenue [1984] IRLR 190
Cummings v Charles Connell and Co (Shipbuilders) Ltd (1969) SLT 25
D C Thomson & Co Ltd v Deakin [1952] 2 All ER 361
General Engineering Services Ltd v Kingston and St Andrew Corporation [1989] IRLR 35
Gouriet v Union of Post Office Workers and others [1977] 3 All ER 70
Henthorn and Taylor v Central Electricity Generating Board [1980] IRLR 360
Jakeman v South West Thames Regional Health Authority and London Ambulance Service [1990] IRLR 62
Mercury Communications Ltd v Scott-Garner and the Post Office Engineering Union [1983] IRLR 495
Miles v Wakefield Metropolitan District Council [1987] IRLR 193
National Coal Board v Galley [1958] 1 All ER 91
Rasool and others v Hepworth Pipe Co Ltd (No.1) [1980] IRLR 88
Rookes v Barnard [1964] AC 1129
Royle v Trafford Borough Council [1984] IRLR 184
Secretary of State for Employment v Associated Society of Locomotive Engineers and Firemen and others (No.2) [1972] ICR 19
Sim v Rotherham Metropolitan Borough Council [1986] IRLR 391
Simmons v Hoover Ltd [1976] IRLR 266
Smith v London Borough of Bexley 5.4.91 County Court
Sunderland Polytechnic v Evans [1993] IRLR 196
Ticehurst and Thompson v British Telecommunications plc [1992] IRLR 219
Tramp Shipping Corporation v Greenwich Marine Inc [1975] 2 All ER 989
Wilkins and others v Cantrell and Cochrane (GB) Ltd [1978] IRLR 483
Wiluszynski v London Borough of Tower Hamlets [1989] IRLR 259
1 Employment Gazette, June 1994, pp.199-209.
2 Workplace industrial relations in transition, by Neil Millward, Mark Stevens, David Smart and W R Hawes, 1992, published by the Dartmouth Publishing Co Ltd.
3 Industrial relations in the 1990s, 1991, (Cm 1602), pp.1-5.
4 Financial Times, 2.3.95.
5 Harvey on industrial relations and employment law, vol. 2, N1435.
