Decision

Bargaining Unit Decision

Updated 20 May 2019

Case Number: TUR1/1079/2018

17 April 2019

CENTRAL ARBITRATION COMMITTEE

TRADE UNION AND LABOUR RELATIONS (CONSOLIDATION) ACT 1992

SCHEDULE A1 - COLLECTIVE BARGAINING: RECOGNITION

DETERMINATION OF THE BARGAINING UNIT

The Parties:

GMB

and

Manheim Limited

1. Introduction

1) GMB (the Union) submitted an application to the CAC dated 3 December 2018 that it should be recognised for collective bargaining by Manheim Limited (the Employer) for a bargaining unit described as: “All those employed in Administration, Yard Operatives, Plate Drivers, Inspectors, Imaging, Swift and HGV Drivers up to, but not including, all First Line Managers, at the Manheim Auction Centre, Yew Tree Trading Estate, Kilbuck Lane, Haydock, WA11 9SZ”. The CAC gave both parties notice of receipt of the application on 4 December 2018. The Employer submitted a response to the CAC dated 10 December 2018 which was copied to the Union.

2) In accordance with section 263 of the Trade Union and Labour Relations (Consolidation) Act 1992 (the Act), the CAC Chairman established a Panel to deal with the case. The Panel consisted of Mr James Tayler, Panel Chair, and, as Members, Mr Len Aspell and Mr Keith Sonnet. The Case Manager appointed to support the Panel was Linda Lehan. For the purpose of this decision Mr. Malcolm Wing deputised for Mr Keith Sonnet.

3) By a decision dated 15 January 2019 the Panel accepted the Union’s application. The parties then entered a period of negotiation in an attempt to reach agreement on the appropriate bargaining unit. As no agreement was reached, the parties were invited to supply the Panel with, and to exchange, written submissions relating to the question of the determination of the appropriate bargaining unit. A hearing was held on 20 March 2019 and the names of those who attended the hearing are appended to this decision.

4) The Panel is required, by paragraph 19(2) of the Schedule to the Act (the Schedule), to decide whether the Union’s proposed bargaining unit is appropriate and, if found not to be appropriate, to decide in accordance with paragraph 19(3) a bargaining unit which is appropriate. In order to accommodate the hearing the Panel extended the period within which it must make its decision to 12 April 2019 which was further extended until 24 April 2019 in order to finalise decision and issue.

2. Summary of the submissions made by the Union

5) The Union submitted that its proposed bargaining unit was appropriate. The Union stated that its proposed bargaining unit did not cut across any existing national or local bargaining arrangements because there are no local bargaining arrangements at the site, nor are there any national bargaining arrangements. The Union stated that the Employer had effectively conceded this in a letter to them dated 29 November 2018 in which the Employer referred to its “National Culture Team” in which “the role of the representatives was to receive information from/give information to management and to then cascade that information more widely through the workforce”. The Union stated that the National Culture team did no bargaining and there was no facility in the organisation for the members to put a case to the company and bargain at local level.

6) The Union stated that its proposed bargaining unit was consistent with the desirability of avoiding small and fragmented bargaining units in that the unit encompassed all those who worked at the Haydock site into a discreet bargaining unit, all of whom were below the level of first line managers.

7) The Union submitted that all the workers in the proposed bargaining unit reported to and were managed by permanently Haydock based managers. The Plate Drivers and the HGV Driver(s) reported to and were managed by the permanent Haydock based Transport Supervisor and the administration staff reported to and were managed by the permanently Haydock based Assistant General Manager, Service Delivery.

8) The Union stated that all the workers in the proposed bargaining unit were permanently based Haydock Auction Centre workers.

9) The Union stated that a different chain of command did not mean that the Plate Drivers should be excluded from the bargaining unit it would just require that when collective bargaining was taking place a person from the appropriate line of management was available at the meetings to make decisions.

10) The Union submitted that the proposed bargaining unit was wholly appropriate, that it established collective bargaining, that it prevented bargaining unit fragmentation and that it engendered and promoted inclusivity for all of the workers at the Manheim Haydock Auction Centre.

11) With regard to the Buyer Services Manager the Union stated that they had not intended for that person to be included in their proposed bargaining unit as in their view the role was first line management and therefore excluded. It was the Employer that had suggested that the role fell within the bargaining unit. The Union stated that if the Buyer Services Manager had no management role they would not object to it being within the bargaining unit.

3. Summary of the submissions made by the Employer

12) The Employer gave a brief summary of the company explaining that Cox Automotive was the world’s largest automotive service organisation. Manheim is part of Cox Automotive and is a leading UK provider of integrated products and services for the vehicle remarketing sector.

13) The Employer explained that the Union’s request for collective bargaining relates to Manheim’s auction site in Haydock which is one of 16 auction sites that Manheim operates in the UK. The main operation based at Haydock is the preparation of vehicles for auction and sale of vehicles. The Employer stated that there are employees from five of Manheim’s job functions (job families) at the Haydock site: Operations, Service Delivery, Buyer Services, Transport & Logistics and Management. The Employer stated that at the time of the Union’s application there were 27 employees in the proposed bargaining unit but this has since increased to 29.

14) The Employer stated that staff costs were aligned to job functions, not geographic locations and that like many organisations it has job rate roles across the job functions, allowing for flexibility with variations such as a weighting for those working inside the M25 to reflect the cost of living. The Employer stated that whilst management decisions were made on a function-by-function basis, local management at geographic locations did have some discretion. The Employer stated that pay rises for the Transport and Logistics function were managed centrally through that job function and decisions were made by the Logistics Director and Area Transport Manager (who are not based at Haydock) and that the onsite Transport Team Leader, who was the first line manager of the 8 workers in Haydock, communicates pay rises to the workers. The Employer stated that for the Operations and Service Delivery Teams, the General Manager has management discretion to influence decisions about the pay for the workers in those job functions based at Haydock and communicates with them about their pay. The initial suggested pay rises for those individuals are sent to the General Manager by the management chain, the Head of Auctions North and Operations Director. The General Manager has authority to challenge those suggestions and influence and agree the pay with the workers in the Operations and Service Delivery Teams at Haydock. When asked whether the Area Transport Manager has this sort of discretion for transport staff the Employer confirmed that there is flexibility in their wages and that the Area Transport Manager has authority to influence and agree the pay rises for their team members in a manner similar to the General Manager for teams for which she is responsible.

15) The Employer stated that terms and conditions of employment such as pension contributions and holiday entitlements are set at a national level, as are hours for some job functions although hours are determined on a geographical site-specific basis for the Operations and Service Delivery Teams.

16) The Employer stated that the management structure for those in Transport & Logistics means that the single site bargaining unit, proposed by the Union, was not compatible with the effective management of Manheim’s business.

17) The Employer stated that there were eight employees from Manheim’s Transport and Logistics job function working at the Haydock site. Their roles involve driving. Some of the workers are required to have CPC (“Certificate of Professional Competence”) qualifications and to hold Class 1 or Class 2 licences. The Employer stated that many of the working practices are influenced by requirements set by the transport industry, which include rules on driving hours and tachographs which were determined by EU regulations. The General Manager explained that she had no experience of directly managing transport staff and their terms and conditions were not part of her remit or management responsibility. The Employer stated that the line manager of the transport staff is the Transport Team Leader, who reports to Manheim’s Logistics Director. The Employer stated that although the workers are based at Haydock, they are drivers and so are out on the road for a significant proportion of their working time. The Employer stated that their terms and conditions of employment including their pay, hours, holiday and their day-to-day management was not aligned with other workers at the Haydock site and as an example explained that their hours were determined by the Transport & Logistics job function management chain. The Employer stated that this aspect of Manheim’s business was managed separately and is not site/Haydock specific, but instead driven by the needs of the wider overall Transport and Logistics function of the Manheim business. The Employer stated that holiday requests for these workers are dealt with by the functional management line. The Employer stated that pay levels for those eight workers in the proposed bargaining unit were determined by business leaders in the Transport & Logistics function and decisions about the pay levels of those workers were made separately to decisions about those in Operations and Service Delivery. However, they accepted that the Area Transport Manager has similar discretion to the General Manager as described above.

18) The Employer stated that five workers from the Service Delivery job function work at the Haydock site and report to the Service Delivery Manager, a first line manager, who reports to the General Manager. The Employer stated that whilst core hours were set nationally within the job function, the General Manager was responsible for ensuring that the Haydock site ran smoothly and had the authority to approve overtime, authorise/veto additional holiday requests and deal with those workers day-to-day management.

19) The Employer stated that fifteen workers from the Operations job function work at the Haydock. They are responsible for the operational aspects of the business, managing the vehicles and providing services such as inspections. The Employer said that eight are Operations Assistants, four are Vehicle Inspectors, one Gate Assistant, one Line Driver and one Maintenance Assistant. The Employer stated that all of the workers at Haydock from the Operations job function report directly or indirectly into the Operations Manager, who in turn reports to the General Manager.

20) The Employer stated that there is one worker in the Buyer Services job function based at Haydock, the Buyer Services Manager. The Employer explained that this is a sales role, akin to an account manager, which is primarily focused on Manheim’s relationship with its buying customers. The role requires in-depth product knowledge and is very different to the other roles within the proposed bargaining unit as it involves interaction with senior management and other workers at site. The Employer stated that the Buyer Services Manager reports to the Area Buyer Services Manager who in turn reports to the BSM Manager and ultimately the Sales Director of Manheim. The job description for the role seeks experience of management and motivating teams and also states that previous experience managing or working within a telesales team would be advantageous.

21) The Employer argued that regard must be paid to the clear dividing lines which exist in the determination of terms and conditions amongst job roles. The Employer relied on the CAC determination in PDAU v Boots Management Services Ltd TUR1/1062/2018.

22) The Employer contended that a bargaining unit should be chosen to avoid fragmentation wherever possible. The Employer relied on the CAC decisions Unison and Kellycare TUR1/781/2012 and GMB and Carillion (2) TUR1/963/2016. The Employer argued that a bargaining unit which leads to splintering of workers who are part of a larger team covered by national lines of authority is to be avoided.

23) The Employer argued that a bargaining unit that cuts across national reporting lines is incompatible with effective management. The Employer relied on the CAC decisions in Unite the Union and Skanska TUR1/1023/2017; Unite and the College of Law TUR1/563/07. The Employer argued that the policy rationale against fragmentation is clear: they argued that it is undesirable for an employer to negotiate in more than one forum where a group of employees could appropriately be bargained for within a single unit. They argued that the CAC panel should avoid “a small island of union recognition in a sea of non-recognition:” per Underhill LJ in Lidl Ltd and CAC v GMB [2017] EWCA Civ 328, [2017] IRLR 646, [2017] ICR 1145).

24) The Employer argued that the single site bargaining unit proposed by the Union was not compatible with the effective management of Manheim’s business. The Employer stated that the bargaining unit should be “all those employed as a Vendor Support Coordinator, Auctions Assistant, Payments Coordinator, Gate Assistant, Line Driver, Maintenance Assistant, Operations Assistant, Vehicle Inspector and Payments Assistant, but not including First Line Managers, at the Manheim Auction Centre, Yew Tree Trading Estate, Kilbuck Lane, Haydock, WA11 9SZ.

4. Considerations

25) The Panel is required, by paragraph 19(2) of the Schedule to the Act, to decide whether the proposed bargaining unit is appropriate and, if found not to be appropriate, to decide in accordance with paragraph 19(3) a bargaining unit which is appropriate. Paragraph 19B(1) and (2) states that, in making those decisions, the Panel must take into account the need for the unit to be compatible with effective management and the matters listed in paragraph 19B(3) of the Schedule so far as they do not conflict with that need. The matters listed in paragraph 19B(3) are: the views of the Employer and the Union; existing 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 under consideration and of any other employees of the Employer whom the CAC considers relevant; and the location of workers. Paragraph 19B(4) states that in taking an Employer’s views into account for the purpose of deciding whether the proposed bargaining unit is appropriate, the CAC must take into account any view the Employer has about any other bargaining unit that he considers would be appropriate. The Panel must also have regard to paragraph 171 of the Schedule which provides that “[i]n exercising functions under this Schedule in any particular case the CAC must have regard to the object of encouraging and promoting fair and efficient practices and arrangements in the workplace, so far as having regard to that object is consistent with applying other provisions of this Schedule in the case concerned.” The Panel’s decision has been taken after a full and detailed consideration of the views of both parties as expressed in their written submissions and amplified at the hearing.

26) In analysing this application we focused on the wording of the Schedule. The Chair of the Panel was greatly assisted by the enormous practical industrial experience of the members. In their submissions, the Employer treated previous decisions of the CAC as if they gave rise to general principles of law to be applied when interpreting the Schedule. While they are of assistance to the Panel in considering how other Panels have analysed bargaining units, the value is limited as every determination turns on the specific facts of the case. That is why our focus has been on the wording of the Schedule and the appellate decisions that give general guidance as to the approach to be taken in interpreting the Schedule.

27) Our role is to determine whether the bargaining unit suggested by the Union is appropriate. That does not require us to determine whether it is the most appropriate bargaining unit; merely whether it is appropriate. Our focus has to be on the question of whether the bargaining unit is compatible with effective management. That involves consideration of whether the bargaining unit proposed is compatible with effective management rather than whether it is compatible with the most effective management, or the precise management structure that the Employer wishes to adopt. See the approach of the Court of Appeal in R (on the application of Kwik-Fit (GB) Ltd) v Central Arbitration Committee [2002] ICR 1212.

28) We consider that the bargaining unit put forward by the Union is appropriate being compatible with effective management. When considering compatibility with effective management the focus is on management of issues about pay, hours and holidays by means of collective bargaining, rather than day-to-day line management of staff.

29) The Employer initially contended that on a proper analysis there was no appropriate bargaining unit. When we pointed out that if we do not accept the Union’s bargaining we are required to identify an appropriate bargaining, that contention was withdrawn. The Employer also suggested that the appropriate bargaining unit might be the entire workforce; either encompassing all workers, or by reference to job function. It is worth noting that the Employer’s suggestion of a bargaining unit of all workers would involve collective bargaining for a number of different job functions. The Employer therefore accepted that there may be a bargaining unit that is compatible with effective management that includes a number of different job functions, with variations of terms of employment. It was the experience of the members of the Panel that bargaining units including a number different job functions are commonplace. At the hearing the Employer’s Counsel stated the Employer was not pushing for the identification of a nationwide bargaining unit.

30) The Employers’ principal contention was that there was a fundamental difference between the employees who fall within the line management structure that reports to Tina Wareing, the General Manager, as opposed to the transport roles which directly report to the Transport Team Leader (at the Haydock depot) who reports to the Area Transport Manager who reports to the Logistics Director.

31) Ms Wareing accepted that she had some discretion in negotiating terms for staff that reported into her but said that she did not have a similar, or any, role in dealing with terms such as pay for transport staff. The Employer accepted that similar negotiating authority to that held by Ms Wareing is held in relation to transport staff by the Area Transport Manager who, unlike Ms Wareing is not located at the Haydock site. The Employer stated that there are certain terms specific to transport staff including those relevant to compliance with EU transport regulations. The Employer argued that there is a clear dividing line in relation to management determination of terms and conditions. The Employer contended that the Union’s proposed bargaining unit based at the Haydock depot would result in the splintering apart of a number of transport workers who formed part of a larger team subject to national lines of authority.

32) We have carefully considered these submissions. We conclude that the practical difficulties that the Employer suggests would arise are considerably overstated. There is nothing unusual about collective bargaining on a geographical basis with a bargaining unit including a number of different types of workers with variations of terms and conditions.

33) There are a number of simple practical steps that could be taken to allow for effective collective bargaining. There is no reason why Ms Wareing need be the sole representative of management in collective bargaining. The negotiating team for the Employer could include a member of staff with specific transport experience. An obvious candidate being the Area Transport Manager. Alternatively, Ms Wareing could be given delegated authority to negotiate with those in the transport team. These options would not involve any significant change in the existing management structure. All it would require is the participation of personnel from more than one part of the management structure in collective bargaining at the Haydock site.

34) We considered that it was significant that the Employer did not rely on witness evidence from the Area Transport Manager or Logistics Director to support their contention that there would be real practical difficulties in joint collective bargaining at the Haydock site.

35) We considered the five specific factors to be taken into account as part of the overall analysis of compatibility with effective management. We took account of the views of the parties. The Union supports the proposed bargaining unit; the Employer is against it.

36) There are no existing national or local bargaining arrangements in the sense of collective bargaining.

37) The Union’s proposed bargaining unit would not create a small fragmented bargaining unit within the meaning of Schedule A1 paragraph 19. The decision in Lidl Ltd and CAC v GMB [2017] ICR 1145 makes it clear that the provision has the purpose of avoiding numerous small units where collective bargaining occurs. There are no other bargaining units at the Employer. The Haydock bargaining unit would be a small part of the Employer’s business. We appreciate that is a factor that may be taken into account in the overall assessment of compatibility with effective management. However, as in Lidl, we do not consider it of great significance in this case, when one is looking at one coherent unit at where collective bargaining can take place.

38) We take into account the fact that the workers within the proposed bargaining unit have a number of different job functions. We appreciate that if the Union is successful in collective bargaining it may obtain benefits for workers based at Haydock that are not available to workers based at other sites. That is the case for employees in all jobs. It is no more the case for transport workers than it is for those in operations or service delivery. It is inherent where there is recognition in part of a business, but not throughout the business, as commonly is the case.

39) Finally we considered the location of the workers; they are all based at the Haydock site even if the drivers spend a good deal of time out on the road. We were told that there is no significant movement of workers, including transport workers, between the Employer’s various sites. We can see significant practical reasons why all workers at the site should have the benefit of collective bargaining. Otherwise, there would be a small group of transport workers who are based at Haydock who are excluded from the benefits of collective bargaining. We consider that leaving transport workers based at Haydock isolated would not be the promotion of fair and efficient practices.

40) The Buyer Services Manager role was not originally identified by the Union as forming part of the bargaining unit. Although the Buyer Services Manager does not currently have any staff to manage, the job description seeks experience of managing and motivating. The Buyer Services Manager does not report to anyone directly at the Haydock site, whereas the transport staff report to the Transport Team Leader. We consider that the Union was right to regard it as a first line management role, and therefore falling outside the bargaining unit.

5. Decision

41) The Panel’s decision is that the appropriate bargaining unit is that specified by the Union in its application, namely “All those employed in Administration, Yard Operatives, Plate Drivers, Inspectors, Imaging, Swift and HGV Drivers up to, but not including, all First Line Managers, at the Manheim Auction Centre, Yew Tree Trading Estate, Kilbuck Lane, Haydock, WA11 9SZ”.

Panel

Mr James Tayler, Panel Chair

Mr Len Aspell

Mr Malcolm Wing (who replaced Keith Sonnet for the hearing)

17 April 2019

6. Appendix

Names of those who attended the hearing:

For the Union

David Tolcher Simpson Solicitors

Alan Collinge Regional Organiser GMB

Shaun Buckley Regional Organiser GMB

For the Employer

Chris Milsom - Cloister Chambers

Anna Cope - CMS Cameron McKenna Nabarro Iswand

Tina Wareing, General Manager - Haydock Manheim

Kerry Davis, Senior HR Business Partner - Manheim Auctions & Logistics

Alison Fisher, Chief People Office - Cox Automotive