Key trade union law case centres on £420,000 compensation for 56 South Yorkshire workers

A key case on trade union law starts today (Tuesday 14 November) into an appeal by Kostal UK Limited against an employment tribunal decision, which ordered the firm to pay 56 Unite members more than £420,000 in compensation after making 'unlawful inducements’. 

The employment appeal tribunal (EAT) in London will hear the appeal by Kostal UK against the decision of a Sheffield employment tribunal (ET) in February this year, which ordered the firm, based near Rotherham, to pay the workers the compensation. 

Unite, the country’s largest union which represents the workers, said the hearing will be the first time an appeal court has considered this important point of law. 

The claims arose after Kostal sought to bypass union negotiations in the first pay talks since the majority of the company's 700-strong workforce voted in favour of Unite being recognised as their trade union. 

In an attempt to break the union and divide members, who had voted strongly to reject the company's pay offer and proposed changes to terms and conditions, in December 2015 the company wrote to employees directly urging them to accept the offer individually and to change their terms of employment, or risk losing a Christmas bonus of £270 each if they did not. 

The offer was then repeated to those that did not accept it in January 2016, coupled that time with the threat of dismissal for anybody who did not accept. 

The Sheffield ET ruled that both offers amounted to unlawful inducements, contrary to section 145B of the Trade Union and Labour Relations (Consolidation) Act 1992, and awarded Unite members over £420,000 in compensation. 

Unite assistant general secretary for legal services, Howard Beckett, said: “This is the first time an appeal court has considered this vital point of law. 

“The EAT’s decision will set a binding legal precedent, which employment tribunals across the UK will be obliged to follow in the future. This is a key case that employers and trade unions will be watching very closely. 

"The importance of today's hearing cannot be underestimated. The case is worth over £420,000 for the Unite members included in the claims and the legal point goes to the very heart and importance of trade union recognition. 

“It is through collective bargaining that we protect our members' terms and improve their rights. 

“The employment tribunal's decision, which we expect the employment appeal tribunal to uphold, confirmed that employers cannot dip in and out of collective bargaining when it suits their purposes, and this is key to protecting workers and trade unions from underhand employer tactics.

“The appeal is being handled by Unite's Strategic Case Unit and we are confident that justice will be done." 

The hearing is scheduled to last today and tomorrow (Wednesday 15 November).