(1) K MILLER (2) B SUTTON (3) I ALDRED v INTERSERVE INDUSTRIAL SERVICES LTD [2012] UKEAT 0244_12_0512

EMPLOYMENT APPEAL TRIBUNAL
BAILII case number: [2012] UKEAT 0244_12_0512Case No Appeal No. UKEAT/0244/12Venue 52 MELVILLE STREET, EDINBURGH, EH3 7HF
Between
(1) K MILLER (2) B SUTTON (3) I ALDREDAPPELLANTINTERSERVE INDUSTRIAL SERVICES LTDRESPONDENT
Before
Mr Justice Underhill Dr K MohantyDate 5 December 2012
[1]APPEARANCES For the Appellants MR TOBY KEMPSTER (of Counsel) Instructed by: Thompsons Solicitors Agincourt House 14-18 Newport Road Cardiff CF24 0SW For the Respondent MISS ELIZABETH CUNNINGHAM (of Counsel) Instructed by: BPE Solicitors LLP St James House St James Square Cheltenham Gloucestershire GL50 3PR SUMMARY TRADE UNION RIGHTS BLACKLISTING Trade union official pressures employer to recruit three named employees with a view to their acting as shop stewards – Relevant manager declines to recruit, as the Tribunal finds, because he resents being "bullied" by the union and does not wish to be dictated to about whom to employ. Held: that, on those findings as to the employer's motivation, it had not refused employment because of the Claimants' trade union membership, contrary to section 137 (1) of the Trade Union and Labour Relations (Consolidation) Act 1992 , nor had the "mental list" made by the employer been compiled for the purposes of discrimination within the meaning of regulation 3 of the Employment Relations Act 1999 (Blacklists) Regulations 2010 so as to give rise to a claim under regulation 5 – Observed that, although the Claimants failed on the facts as here found, tribunals would need to scrutinise carefully any such case advanced by an employer. Observation, obiter, that if the employer had complied with the official's request that would not have involved any breach of section 137 (4). THE HONOURABLE MR JUSTICE UNDERHILL INTRODUCTION The Respondent in these proceedings, and to this appeal, is a company which provides labour for so-called "shutdown projects" at oil depots. The Claimants (the Appellants before us) are scaffolders. All three are members of UNITE: this is a highly unionised sector of industry. They applied for employment with the Respondent on a project known as the Murco shutdown but were not taken on. Two of them also applied for employment on the Pembroke shutdown but were likewise not recruited. They brought proceedings in the Employment Tribunal claiming that the reason why they were not taken on was their trade union membership, contrary to section 137 of the Trade Union and Labour Relations (Consolidation) Act 1992 and/or that their non-employment was for a reason relating to a prohibited list, contrary to regulation 5 of the Employment Relations Act 1999 (Blacklists) Regulations 2010 . Their claims were heard by a Tribunal sitting in Cardiff, chaired by Employment Judge Beard, over seven days in January this year. By a reserved Judgment with written Reasons sent to the parties on 21 February their claims were dismissed. They appeal against that decision. They have been represented before us by Mr Toby Kempster of counsel (who did not appear below); Miss Elizabeth Cunningham of counsel appeared for the Respondent both before us and in the Tribunal.[2]It will be convenient at this stage to set out the relevant statutory provisions. Section 137 of the 1992 Act reads (so far as material) as follows:
" Refusal of employment on grounds related to union membership E+W+S (1) It is unlawful to refuse a person employment— (a) because he is, or is not, a member of a trade union, or (b) because he is unwilling to accept a requirement— (i) to take steps to become or cease to be, or to remain or not to become, a member of a trade union, or (ii) to make payments or suffer deductions in the event of his not being a member of a trade union. (2) A person who is thus unlawfully refused employment has a right of complaint to an employment tribunal. (3) … (4) Where there is an arrangement or practice under which employment is offered only to persons put forward or approved by a trade union, and the trade union puts forward or approves only persons who are members of the union, a person who is not a member of the union and who is refused employment in pursuance of the arrangement or practice shall be taken to have been refused employment because he is not a member of the trade union. (5) – (8) … "
Regulation 5 of the 2010 Regulations reads (again, so far as material) as follows:
"(1) A person (P) has a right of complaint to an employment tribunal against another (R) if R refuses to employ P for a reason which relates to a prohibited list, and either— (a) R contravenes regulation 3 in relation to that list, or (b) R— (i) relies on information supplied by a person who contravenes that regulation in relation to that list, and (ii) knows or ought reasonably to know that the information relied on is supplied in contravention of that regulation. The relevant parts of regulation 3 are as follows: "(1) … [N]o person shall compile, use, sell or supply a prohibited list. (2) A "prohibited list" is a list which— (a) contains details of persons who are or have been members of trade unions or persons who are taking part or have taken part in the activities of trade unions, and (b) is compiled with a view to being used by employers or employment agencies for the purposes of discrimination in relation to recruitment or in relation to the treatment of workers. (3) "
Discrimination" means treating a person less favourably than another on grounds of trade union membership or trade union activities." THE CLAIMANTS' CASE AND THE TRIBUNAL'S REASONS[3]Before the Tribunal the Claimants relied on two episodes of discrimination. They pursue no appeal in relation to the Tribunal's decision as regards the first of those episodes. Their case in relation to the second episode can be summarised as follows.[4]The Claimants had a history of acting as shop stewards. In particular, they acted as shop stewards for the workforce supplied by another contractor (known as Cape) to a project called South Hook which was winding down in earlier 2009. In that role they had been involved in organising unofficial industrial action; and their activities had apparently extended beyond the Cape workforce to employees supplied to the project by the Respondent.[5]UNITE and the Respondent were party to a collective agreement which contained among other things provisions designed to facilitate the role of accredited and experienced shop stewards. The agreement contained a provision that employers should "undertake as far as is practicable to place onto an appropriate contract an NECC accredited senior steward" for certain categories of site (into which the Murco site would fall). There was also a provision in the following terms:
"While the employer's right to select its employees solely to meet its needs is guaranteed, employers undertake to assist in encouraging the selection of shop stewards from amongst their workforce including a senior steward to operate within the jurisdiction of their contract whose appointment shall be subject to NECC approval."
In early March 2010 a full-time official of UNITE, Mr Allan Card, telephoned Mr Tim Jenkins, the Respondent's Operations Manager in relation to the Murco shutdown, who was the effective decision-taker about recruitment, and put forward the Claimants' names for employment on that project. He regarded the provisions of the collective agreement as giving the union, in effect, a right to nominate members for recruitment with a view to their acting as shop stewards. He made it clear to Mr Jenkins that he wished the Claimants to be recruited on that basis.[6]None of the Claimants was recruited to the Murco project; nor were the two who subsequently applied for the Pembroke project. It was their case that a deliberate decision had been taken not to recruit them because they had been put forward by Mr Card in that way.[7]The Tribunal went a long way towards accepting that case. It accepted – though this was not in fact in dispute – that the conversation between Mr Card and Mr Jenkins took place, and it preferred Mr Card's recollection that it took place in March, rather than in January as Mr Jenkins believed. It also accepted – though this, again, was not in dispute – that Mr Card asked Mr Jenkins to take on the three Claimants and that he referred to the collective agreement as entitling him to do so. Further, and importantly, it found that as a result of that conversation Mr Jenkins decided that the three Claimants would not be recruited. As it put it, at para. 41.4 of the Reasons: "It is clear that Mr Jenkins created a list of those who he did not wish to employ. That list was the three claimants. He created that list because of the contact made by Mr Card. That list was purely in his mind. He relied on that list in deciding not to recruit the Claimants." (The concept of "creating a mental list" sounds a little contrived, but the Tribunal of course had in mind the provisions of the 2010 Regulations: see paras. 11-12 below.)[8]So far so good from the Claimants' point of view. Crucially, however, the Tribunal did not accept that Mr Jenkins' decision could be described as being because of their union membership or activities. It found that Mr Card, who it described (Reasons para. 29.1.9) as having a "combative approach and … forthright manner", had in his conversation with Mr Jenkins been "assertive" about what he understood to be a right to nominate employees with a view to their acting as shop stewards, and that he had indicated "firmly" that they should be taken on (see Reasons para. 29.1.8-10). It said, at para. 29.1.11 of the Reasons:
"We are … of the view … having seen the e-mail at 562 that Mr Jenkins did not take kindly to this and we have come to the view that he felt bullied by this. Having seen Mr Jenkins we take the view that he "dug his heels in" with regard to the claimants. Although the claimants would have been at the forefront of his mind because of his discussion with Mr Card he would not then bring their names forward at the management meetings where recruitment was discussed. He was, in terms, not going to be told who to employ."
The e-mail to which the Tribunal refers is dated 5 March 2010 and is from Mr Jenkins to three of his management colleagues. It reads as follows: "Further to my conversation with Adrian & Joe this morning please find some further information I have gathered: - 1 – Keith Miller & Ian Aldred have applied to both Interserve and SHS Scaffolding for employment during the shutdown and have been told by both companies that they are on the list and will be contacted if an opportunity comes up. (The information regarding "turning down employment" is untrue as I've spoken to Paul Smith Owner of SHS) 2 – Both Unite and GMB are trying to obtain employment for these guys on Murco as to date neither IIS or SHS have appointed full time shop stewarts as the need has not arose yet. But if we need to elect one Gerald Morris will take on that roll. As you are aware Gerald was our full time shop stewart on the South Hook project. 3 – I have explained to Allan Card that these guys are on the list but we will carry on employing scaffolders as and when required. If I'm honest the unions are trying to bully us into taking they on. 4 – We have heard that the 2 guys are planning a protest on the Murco Gate on Monday morning, to protest at not being able to gain employment on the shutdown. If you could let me know your thoughts in this matter I would appreciate it." (SHS is another company with a similar business to the Respondent and was indeed originally a party to these proceedings.)[9]On the basis of those facts, the Tribunal found:
"29.1.18. In those circumstances, we do not consider that that evidence supports a proposition that Trade Union activity or membership was at the heart of Mr Jenkins' decision not to employ the claimants. 29.1.19. In our judgment the reason was this. Mr Card had called and pressed the matter in circumstances where Mr Jenkins felt that it was his right to recruit who he thought was best without such influence."
A little later, the Tribunal repeated that Mr Jenkins had "set his face against the three Claimants being employed … because of the pressure that had been applied by Mr Card" (Reasons 29.3-29.3.1). It continued:
"29.3.3. Mr Jenkins felt that he was being bullied into employing particular individuals. Mr Jenkins did not want this pressure and wanted to recruit as he saw appropriate. 29.3.4. If we are asked to label the reason for non recruitment we would say that it was neither any unofficial action that had occurred at the South Hook Project nor because the claimants had been assisting the respondent's employees, it was the reaction of Mr Jenkins to Mr Card's pressure and his wish to recruit those who he felt were best for the project rather than those who were recommended by the Union."
[10]The passages from the Reasons which we have so far quoted come from the narrative section. The formal statement of the Tribunal's conclusions on the issue appears in the "analysis" section. After considering and rejecting the claim in relation to the earlier episode to which we have referred, it says:
"41. That situation changes in early March 2010. 41.1 It is arguable that there are facts tending to demonstrate that trade union membership and/or activity played a part in the respondent failing to recruit the claimants from March 2010 onwards. 41.2 This is because Mr Jenkins' response, to the overtures made by Mr Card on behalf of the claimants, was negative. 41.3 However, the Tribunal have come to the conclusion that the reason why that treatment occurred was not because the claimants were members of trade unions or had undertaken trade union activities. 41.4 It is clear that Mr Jenkins created a list of those who he did not wish to employ. That list was the three claimants. He created that list because of the contact made by Mr Card. That list was purely in his mind. He relied on that list in deciding not to recruit the claimants. 41.5 Mr Card was contacting the respondent on the claimants' behalf could be seen as connected with trade union activity. 41.6 However it is key that Mr Jenkins, on receipt of the call from Mr Card, wanted retain his freedom to recruit whom he preferred. It was a positive wish to retain that freedom, rather than a negative response to the claimants. It was not therefore on the basis of trade union membership or trade union activity that he created the list. Neither is it the case that Mr Jenkins refused the claimants employment because of trade union membership in line with Section 137. 41.7 We find that this applies both to the Pembroke and the Murco Shutdown projects."
[11]To summarise, the Tribunal found as a matter of fact that the decision not to recruit the Claimants was not because they were members of UNITE, or because of their activities in that capacity, but because Mr Jenkins resented Mr Card's interference. As a matter of law, that meant that the claims under both section 137 and regulation 5 failed because:(a) As regards section 137, Mr Jenkins' decision had not been " because … [the Claimants were] … member[s] of a trade union [our emphasis]" within the meaning of sub-section (1) (a).(b) As regards the Regulations, the "mental list" comprising the Claimants which Mr Jenkins made (see para. 7 above) was not "compiled with a view to being used … for the purposes of discrimination in relation to recruitment", within the meaning of regulation 3 (2), because it was not intended to treat the people on it (that is, the Claimants) less favourably (that is, by not recruiting them) " on grounds of trade union membership or trade union activities [our emphasis]" within the meaning of regulation 3 (3); and that accordingly the list was not a "prohibited list" within the meaning of regulation 3 (1) and regulation 5 (1) was not engaged.[12]We should mention for completeness that the Respondent had argued before the Tribunal that a purely "mental" list, i.e. one which was not reduced to any kind of writing (whether hard copy or in e-form), did not fall within the terms of the Regulations. The Tribunal rejected that argument (Reasons, para. 38), and the point was not raised in the Respondent's Answer or otherwise sought to be taken before us. It may remain open for argument on another occasion.[13]Although that reasoning, if correct, was decisive of the claims, the Tribunal also advanced an alternative reason why they should not succeed. The point is developed at some length in para. 42 of the Reasons, but the gist is that if Mr Jenkins had acceded to Mr Card's request to employ the Appellants that would have constituted an "arrangement or practice" of the type deemed by section 137 (4) to constitute unlawful discrimination, and that it accordingly could not be right that a refusal to enter into such an arrangement could be unlawful. ANALYSIS THE PRINCIPAL ISSUE[14]The Tribunal's decision in relation to both section 137 and regulation 5 turned on a familiar question in discrimination law, namely what was the reason why Mr Jenkins took the decision that he did: the various statutory formulae – "because/because of", "on grounds/on the grounds that", "by reason that" etc. – all connote the same test. In a case of this character (cases where an inherently discriminatory criterion is applied are different) that requires a consideration of the "mental processes" which caused the decision-taker to act as he did – sometimes referred to as his "motivation" ( not motive): see the speech of Lord Nicholls in Nagarajan v London Regional Transport [1999] ICR 877 (at pp. 884-6); Ahmed v Amnesty International [2009] ICR 1450 (at paras. 31-37 (pp. 1469-71)); R v Governing Body of JFS [2010] 2 AC 728 ; and Martin v Devonshires [2011] ICR 352 (at paras. 35-36 (pp. 369-371)). Recognising this, Mr Kempster did not seek to rely simply on the fact that the Claimants would not have been treated in the way that they were if they had not been trade union members (or activists) – that is, because Mr Card would not have tried to put forward anyone who was not a trade union member (or activist). No doubt that was the case, but that kind of "but for" causative link is not enough: the Claimants' trade union membership (or activities) must have been at least part of what operated (consciously or subconsciously) on Mr Jenkins' mind to make him do what he did – see Ahmed (above), para. 37 (pp. 1470-1). Instead he argued that the distinction made by the Tribunal had no real substance. This was not simply a case of Mr Jenkins resenting being bullied: he resented being bullied "by the unions" – see point 3 in his e-mail quoted at para. 8 above – and what he was being bullied to do was to recruit particular union members who would act as shop stewards. In those circumstances, to distinguish between his resentment at being bullied and what he was being bullied to do was meaningless.[15]We have not all found this easy, but in the end we are not persuaded by Mr Kempster's submissions. Our reasons are as follows.[16]The starting-point is that it seems to us that the distinction which the Tribunal made is one that is admissible in principle. If Mr Jenkins was motivated wholly by pique (to use, perhaps, an unkind term) at what he regarded as unacceptable pressure from Mr Card, that is in our view genuinely distinct from the issue of what he was being put under pressure about. There is a real difference between "I don't want the (no doubt, activist) shop stewards who Card is putting forward" and "Card has been so overbearing towards me that I am damned if I give him what he wants": the former relates to the characteristics of the individuals, whereas the latter relates entirely to Mr Card's conduct and the identity of the particular individuals concerned is immaterial. [1] In fact, it may be fair to read the Tribunal's findings as going rather further than that – that is, as finding that Mr Jenkins was not simply displaying personal pique but wanted to put down a marker on behalf of the employer reminding the union that it had no right to dictate who was employed. But, though that may seem nearer the line, it remains on the right side of it. He would be objecting to recruiting them, not because of their membership or activities or indeed because of anything about them personally – but simply because they happened to be the ones who Mr Card was, as he saw it, trying to force down his throat. It would of course in such a case be very bad luck on the Claimants that they should be caught in the crossfire between Mr Jenkins and Mr Card – whether personal or "corporate" – but there is no law of "unfair non-recruitment".[17]If, therefore, the distinction is acceptable in principle, the question comes down to one of fact – that is, whether Mr Jenkins' reasons were truly what he claimed or whether they were a cover for a wish not to employ these individuals because of their trade union membership or activities. It is not in fact plausible that Mr Jenkins would have been troubled by the Claimants' membership as such: as already noted, this was a highly unionised workforce. But one does not have to be very cynical to suspect that their activities might have made them unwelcome. [2] There is in fact no finding that Mr Jenkins knew of the Claimants' activities at South Hook (see para. 4 above); and indeed in relation to what we have called the first episode, the Tribunal made a positive finding that one of his colleagues, Mr Davey, "had [no] axe to grind in respect of the claimants because they had acted as shop stewards [at South Hook] on an unofficial basis" – Reasons para. 27.3.5. But, even if he was unaware of those activities, he might reasonably have inferred that the Claimants were activists from the mere fact that Mr Card was promoting them. Mr Kempster pointed out that in the e-mail quoted at para. 8 above – see point 2 – Mr Jenkins seemed to be expressing a preference for a different shop steward, and he suggested that it could be inferred that the preferred candidate was someone whose approach was more acceptable to management.[18]However, whether those suspicions would in fact be justified was a matter for the judgment of the Tribunal. It quite clearly found (subject to the point which we consider at para. 19 below) that Mr Jenkins' motivation was indeed as he claimed, and that he was not motivated by either the Claimants' membership of UNITE or their known or inferred activities in that capacity. Mr Kempster, realistically, did not contend that that conclusion was not open to the Tribunal on the evidence. It had heard Mr Jenkins give evidence and was well placed to judge his "mental processes". We should perhaps add, to give some context to the Tribunal's conclusion on this particular point, that it plainly did not regard the Respondent as "anti-union". It made a point of noting (see Reasons para. 21) that it had recruited for the Murco project three employees who had taken part in the unofficial action at South Hook, two at least of whom had taken "a significant and visible role" in the action. And, as already noted, it found that another of the relevant managers had not been troubled by the Claimants' own activities at South Hook. It said, at para. 30 of the Reasons:
"The one aspect of the facts thus far neglected but which is of importance is that all three claimants have during cross-examination indicated that they can offer no direct evidence whatsoever as to discrimination. Further none could provide any explanation whatsoever as to why it would be the case that they should have been singled out on the grounds of their trade union activities or membership in the way that others were not."
[19]Of course, it need not be all or nothing. Mr Kempster reminded us that the Claimants only needed to show that their trade union membership (or activities) were a significant part of Mr Jenkins' mental processes (conscious or subconscious): they did not need to be his principal reason. [3] He submitted that there were indications that the Tribunal had failed to appreciate that. He relied in particular on its formulation at para. 29.1.18 of the Reasons (see para. 9 above) that the Claimants' trade union membership or activities were not "at the heart of" Mr Jenkins' decision, which he said showed that the Tribunal believed that it was only concerned – as in an unfair dismissal case – with the principal reason for the decision. That phrase taken by itself is, we accept, rather loose; but when the Reasons are read as a whole we can see nothing to justify the conclusion that the Tribunal fell into the error alleged. There is nothing surprising in a finding that Mr Jenkins was motivated entirely by his reaction to Mr Card's attempt, as he saw it, to push him around; and, as we have said, that is something which the Tribunal was well placed to judge.[20]We wish to emphasise that the Tribunal's decision, and our endorsement of it, turns on its assessment of the evidence in the particular case. It is not in every case that an employer who refuses to engage a potential shop steward suggested to him by a recognised trade union will be able to persuade a tribunal that his reasons had nothing to do with the candidate's trade union activities; and indeed we would expect any such explanation to be scrutinised narrowly. But on this occasion the Respondent passed the test. THE ALTERNATIVE POINT[21]Our decision on the primary reasoning means that the point identified at para. 13 above does not fall for decision. But we will deal with it briefly. We have already summarised the Tribunal's reasoning, namely that if Mr Jenkins had acceded to Mr Card's pressure the Respondent would have been in breach of section 137 (4) (which we have set out at para. 2). The short answer is that nothing in the conversation between them constituted or evidenced an "arrangement or practice under which employment is offered only to persons put forward or approved by a trade union [emphasis supplied]". It is indeed clear that there was no such arrangement: generally the Respondent employed who it chose, and even if it had taken on three union nominees for the particular reason advanced by Mr Card that would not have affected the overall position. Accordingly if this point had been decisive we would have allowed the appeal. CONCLUSION[22]For those reasons we dismiss the appeal. Note 1 There may be some analogy with the distinction, which is recognised as legitimate, between an employer objecting to trade union activities as such and his objecting to the unreasonable manner in which they are pursued: see Lyon v St. James Press Ltd [1976] ICR 413 and Bass Taverns Ltd v Burgess [1995] IRLR 596 , and the comments on them in Martin (above) at para. 22 (p. 346).) Note 2 There is a good deal of law on whether section 137 (1) applies to cases where the employer does not object to the candidate’s union membership as such but only to his or her activities in that role: see the discussion in Harvey on Industrial Relations and Employment Law NI paras. 820-832. But we were not addressed on this aspect, no doubt because, whatever the position under section 137, the Regulations refer explicitly to “activities”. Note 3 In this connection he referred us to the observations of Mummery J in O’Neill v Governors of St. Thomas More Roman Catholic School [1997] ICR 33 , at para 22 (iii); but in fact the same point is (even) more authoritatively made in Nagarajan (above), per Lord Nicholls at p. 886 D-G. And see now Fecitt v NHS Manchester [2012] ICR 372 , at paras. 43-45 (pp. 383-4), which confirms that there is no difference in this regard between discrimination with an underpinning in EU law and discrimination based purely on domestic legislation.