Decision

Bargaining Unit Decision

Updated 17 April 2024

Applies to England, Scotland and Wales

Case Number: TUR1/1378(2023)

17 April 2024

CENTRAL ARBITRATION COMMITTEE

TRADE UNION AND LABOUR RELATIONS (CONSOLIDATION) ACT 1992

SCHEDULE A1 - COLLECTIVE BARGAINING: RECOGNITION

DETERMINATION OF THE BARGAINING UNIT

The Parties:

National Union of Journalists (NUJ)

and

The Press Association Ltd

1. Introduction

1)         National Union of Journalists (the Union) submitted an application to the CAC dated 28 November 2023 that it should be recognised for collective bargaining purposes by The Press Association Limited (the Employer/PA Ltd) in respect of a bargaining unit comprising “editorial roles which ultimately report to the Editor in Chief, barring the senior management roles. For the avoidance of doubt the senior management roles that are excluded are as follows: Editor in Chief, Business Editor, Chief News Editor, Head of Analytics and Insight, Head of Entertainment and Features, Head of Page Production, Head of Pictures, Head of Production, Head of Puzzles, Head of Video, Ireland Editor, Scotland Editor, Social Media and Real Life Editor and Sports Editor.” The location of the bargaining unit was given as “The Point, 37 North Wharf Road, London, W2 1AF and at various satellite offices throughout the nations and regions of the UK, as well as those whose roles classify them as home workers or working from home and those working as UK contracted overseas staff.”  The application was received by the CAC on 28 November 2023 and the CAC gave both parties notice of receipt of the application by a letter of the same date. The Employer submitted a response to the CAC dated 5 December 2023 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 Ms Laura Prince, K.C., Panel Chair, and, as Members, Mr Martin Kirke and Mr Nicholas Childs. The Case Manager appointed to support the Panel was Joanne Curtis.

3)         By a decision dated 15 January 2024 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.

2. Hearing

4)         A hearing was held via zoom on 20 March 2024 and the names of those who attended the hearing are appended to this decision. Both parties provided written submissions prior to the hearing together with supporting documentation. The Panel would like to thank the parties for their thorough and clear written and oral submissions and for answering the questions raised by the Panel prior to, during and after the hearing^{[footnote 1]}. The information they provided was very helpful to the Panel.

3. Points of clarification at the outset of the hearing

5)         At the outset of the hearing it was clarified that there were two key issues between the parties:

(1)       Whether nine workers, whose contracts of employment expressly stated that they were employed by PA Photos Ltd, could be included within the bargaining unit.

(2)       Whether Managers’ Deputies should be excluded from the bargaining unit.

6)         The Parties clarified that they were now in agreement that the six workers employed by Press Association of Australia Ltd in the Australian business and the five employed by Press Association of Ireland Ltd in the Republic of Ireland were outside the proposed bargaining unit.

4. Summary of the submissions made by the Union

7)         The Union relied on witness statements from Emily Pennick and Jonathan Brady together with the accompanying documents and the relevant publicly available companies house material in relation to PA Photos Limited.

8)         The Union asserted that the bargaining unit put forward by them was an appropriate bargaining unit.

5. Summary of the submissions made by the Union in respect of PA Photo Workers

9)         As set out above, at paragraph 5(1) there was a dispute between the parties as to whether nine workers whose contracts of employment expressly stated that they were employed by PA Photos Ltd could form part of the bargaining unit in this case.

10)       The Union raised two arguments in support of their proposition that those workers could form part of the bargaining unit in this case:-

(1) That the workers were in fact employees of PA Ltd notwithstanding that the employer names on their contracts was PA Photos Ltd (the key facts relied upon by the Union are set out at paragraphs 16 to 19 below);

(2) That even if the workers were deemed to be employed by PA Photos Ltd (and not PA Ltd) then, applying the case of Graphical Paper and Media Union v Derry Print Limited [2002] (‘Derry Print’) for the purposes of the statutory recognition process the workers were in reality employed by the Employer.

11)       The Union accepted that in the case of Derry Print, the CAC, had considered the meaning of the word ‘employer’ used in Schedule A1 of the Trade Union and Labour Relations (Consolidation) Act (‘TULR(C)A’) and concluded that ‘the Schedule could not be construed so as to permit the CAC to establish a single bargaining unit covering the workers employed by more than one employer, regardless of whether those employers are ‘associated employers’’. 

12)       However, the Union went on to point out that the CAC in Derry Print had held that ‘in an exceptional case it might be correct to regard two or more employers as a single employer’.

13)       The Union took the Panel to paragraph 35 of Derry Print, where the CAC held that the case before them was an exceptional case for the following reasons:-

‘outside the area of corporate liability, it is permissible to view two companies as one in reality if there is overwhelming evidence that, in respect of all the elements of the area to which the relevant law applies, they are actually one. In the present case there is no room to suppose that the distinction between the two companies is a sham. They have a long history of separate incorporation. We consider, however, that the power to lift the veil in respect of a sham is not intended as a form of punishment but relies upon the conclusion that the reality of unity is concealed by the technical appearance of separation’.

14)       The Union asserted that, the reasoning from Derry Print applied on the facts of this case because the facts were similarly exceptional (for the reasons set out at paragraphs 16 to 19 below).

15)       In support of this argument the Union also referred to the case of Uber, at paragraph 70, in respect of statutory interpretation:-

“The modern approach to statutory interpretation is to have regard to the purpose of a particular provision and to interpret its language, so far as possible, in the way which best gives effect to that purpose”.

The Union asserted that the purpose of Schedule A1 TULR(C)A was to facilitate collective bargaining and that the exclusion of PA Photo employees from the bargaining unit would not further this purpose.

16)       The Union pointed to the fact that the contracts of employment of PA Photos Limited were identical to those of PA Ltd (save for the Employer name at the top of those contracts) in all relevant respects. In particular, in respect of hours of work, and annual holiday entitlements.  The Union asserted that save for the exception of a couple of old contracts the contracts of PA Photo Limited employees and PA Ltd employees were strikingly similar. The Employer agreed, following questions from the Panel, that there were no substantive differences between the terms and conditions enjoyed by PA Photo employees and those enjoyed by PA Ltd employees.

17)       The Union also took the panel to the companies’ house searches and statutory accounts produced by PA Ltd and PA Photos Limited which: -

(1) showed that PA Ltd had 100% ownership of PA Photos Limited.

(2) showed that the directors of PA Ltd and PA Photos Limited were the same.

(3) referenced ‘continued integration with another PA Media Group Business’ (which the Union interpreted to be PA Ltd).

(4) stated that PA Photos Limited had no employees.

18)       The Union questioned the Employer’s evidence that they merely ‘administered’ the payroll for PA Photos Limited. On further questioning from the Panel the Employer stated that PA Ltd paid the PA Photos employees and that they were not reimbursed by PA Photos.

19)       The Union asserted that in day to day practice all photographers and desk staff (regardless of whether the contracts said the workers were employed by PA Photos Limited or the Press Association Ltd) were part of the same departmental team which the Employer called “Picture Desk”.  There was no substantive difference between employees with a PA Photos Limited contract and other employees. The Union gave evidence that the line manager of the Picture Desk team was the Head of Pictures and below them two Deputy Group Picture Editors. The Union explained that the Head of Pictures managed workers whose contracts stated they were employed by the Press Association Ltd and PA Photos Limited. The Union said that to all extents and purposes it was one team and there were no practical or operational differences depending on the name of the Employer on the contracts of employment. The Union said that all workers were treated and managed in the same manner.

20)       The Union said that there were some workers employed by the Australian and Irish entities, but a decision had been taken not to include these workers in the bargaining unit due to them working in different jurisdictions and having differently regulatory regimes. The Union emphasised that this was very different to PA Photos Limited who were employed by a UK based company.

6. Summary of submissions made by the Union in respect of the Deputies

21)       The Union said that the nature and extent of the Deputies role was a question of fact for the CAC. The Union said that the role of these individuals was not such that there would be a “material conflict of interest” such that a bargaining unit containing Deputies would prevent it being compatible with effective management.

22)       Counsel for the Union Ms Madeline Stanley said that it may be relevant to ask “on what side of the line do these Deputies fall. The fact the individuals may have other management responsibilities is immaterial as the purpose of the bargaining unit and collective bargaining is to negotiate on pay, hours and holidays.”

23)       The Union stated that Deputies was a descriptive term used for the purposes of this hearing. In fact, not all of the roles identified as ‘Deputies’ by the Employer had the name Deputy in their job title (she pointed to the Lifestyle Editor and Head of Features roles listed as Deputy Managers in the Employer’s witness statements). Ms Stanley also pointed to the fact that not all of the roles had a direct correlation with a Manager role. For example, three of the Deputies roles reported into one Manager – the Head of Entertainment and Features.

24)       Ms Stanley also referenced the job descriptions for the Deputies and pointed out that in the majority of them there was no reference to the setting of pay or to their alleged management roles (such as involvement in disciplinary processes).  The Union pointed to the emails provided by the Employer aimed at showing that the Deputies had management responsibilities and stated that they did not evidence such a role (involvement in for example flexible working or interviewing new starters did not indicate a role in setting pay for existing employees). 

25)       At the hearing Ms Pennick gave evidence that she had (in the past) been a Deputy Manager and that she had not been involved in salary setting. Ms Pennick said that her Deputy role had been approximately 10 years ago but said that she had discussed matters with other Deputies and that her understanding was that the role was not significantly different now. Ms Pennick said the information given to her varied with some Deputies saying that they were consulted on salaries. Ms Pennick added that all those she spoke to said that they had no decision-making authority in respect of pay decisions.

26)       Ms Stanley relied on the case of BECTU v Royal Shakespeare Company Limited TUR1/540 (2005), 7 February 2007 in support of the proposition that ‘it is not a general principle of industrial relations that the immediate managers of a group of workers should not be included in the bargaining unit as those they supervise’.  Ms Stanley also relied on an extract from Harvey  at 1269, as setting out relevant factors in determining whether immediate managers should be within the BU:-

“It may be particularly relevant to ask whether the team leader (howsoever designated) has disciplinary powers in respect of his team (so that he may be perceived to be one of ‘them’ rather than one of ‘us’), or whether his role involves any bargaining function (so that inclusion in the bargaining unit would give rise to conflicts of interest that he would , to some extent, be sitting on both sides of the bargaining table) or whether he otherwise has a significant role in determining pay within the proposed bargaining unit (so that, again, there would be a conflict of interest’.

27)       Overall Ms Stanley stated that the Deputies were in a materially different position to Managers and that their inclusion within the bargaining unit would not be incompatible with effective management.

7. Summary of the submissions made by the Employer

28)       The Employer said that its submissions rested upon the witness statements of Jessica Taylor, PA HR Director and Peter Clifton, Editor in Chief PA. The Employer asserted, in oral submissions, that the unit put forward by the Union, excluding the PA Photos Ltd employees and excluding the Deputies would be an appropriate bargaining unit.

29)       In the statement of Jessica Taylor, the Employer she said “whilst we have some basic understanding of why the NUJ has chosen the proposed bargaining unit, there remain concerns about it. PA has no recent history of trade union recognition or collective bargaining, and therefore we do not view our organisation in terms of ‘bargaining units’. At the moment pay and terms and conditions are ultimately determined by the Executive team at a group wide level and most terms and conditions (including percentage annual pay reviews) are common across the group. The Editorial department has less than 300 employees in total, compared with around 1,000 in the group. The proposed bargaining unit cannot even be all of Editorial because the NUJ have excluded Managers….. and there are 20 employees excluded because they work for other group companies. This fragmentation of the Editorial department certainly risks compromising effective management of the department and will create divisions and inconsistencies across the group.”

8. Summary of submissions made by the Employer in respect of PA Photos Ltd.

30)       The Employer said that the nine workers the Union asserted should be included within the proposed bargaining unit were not employed by the Press Association Ltd but were employed instead by PA Photos Ltd.

31)       The employer stated that the arrangements between PA Photos Ltd and PA Ltd were not a sham and that the case of Derry Print (see paragraphs 11-13 above) did not apply on the facts of this case. This was not an ‘exceptional case’.

32)       In their written submissions the Employer ‘reserved its position to challenge the reasoning in Derry Print as a misdirection of law if applied’. 

33)       The Panel made the observation that it was not bound by previous cases of the CAC such as Derry Print.  When asked whether they were asserting, at this hearing, that Derry Print should not be applied the Employer stated that they were and that Derry Print amounted to an impermissible lifting of the corporate veil. The Employer argued that the reasoning in Derry Print, if applied, would amount to a misdirection of law.

34)       The Employer explained that PA Photos Limited was a subsidiary company of The Press Association Ltd. PA Photos was established in 1999 to operate as a commercial photo syndication business separate to the existing news agency in PA Ltd. At this point, the Employer said that all photography staff were moved to this newly formed company which subsequently also incorporated the EMPICS business after EMPICS was purchased in 2004. PA Photos both employed photographers and made licensing deals with contributing photographers and agencies. PA Photos then supplied these pictures both to the Press Association for use in their news wire and to third parties commercially under the brand PA Images. When PA Media Group acquired image platform Alamy in 2020 the decision was made to cease the sale of images by PA Photos Ltd and instead allow Alamy to represent PA Photos’ pictures on the Alamy platform.  The Employer explained that from 2020 the decision was made not to recruit any new employees to PA Photos Ltd and for any new hires to be employed by The Press Association Ltd instead. However there remained at the time a number of photographers in PA Photos Ltd. The Employer said that PA Photos still operated as a supplier to Alamy and to PA Ltd and employed nine people. The Employer said that the payroll for PA Photos Ltd was administered by PA Ltd.

35)       The Employer said this was not a “sham arrangement” and produced the contracts of the nine workers dated as recently as 2018. The Employer explained that a decision was taken in 2020 not to contract new employees to PA Photo Ltd but the evolution of that part of the “Group business”, demonstrated “that this may now be a residual group of workers but that does not make their contractually distinct employment a sham.”

36)       The Employer accepted that there was no substantive difference between the terms and conditions enjoyed by PA Photos Ltd employees and PA Ltd employees.

37)       The Employer stated that PA Ltd ‘administered payroll for PA Photos Ltd’.  When asked clarificatory questions by the Panel the Employer confirmed that PA Ltd paid the PA Photos Ltd employees and that they were not reimbursed by PA Photos Ltd although they added that PA Ltd also received profit from PA Photos which could potentially cover the wages of the PA Photos employees.  The Employer accepted that there was no direct correlation between the wages of the employees and the income generated by PA Photos.

38)       The Employer accepted that PA Photos employees worked within the same structure as PA Ltd employees and that PA Ltd employees had line management over PA Photos employees.

39)       The Employer stated that regardless of this cross-over PA Photos was not a sham and that the exceptional circumstances set out in Derby Print did not apply. Alternatively, the Employer asserted that Derby Print was wrong in law and involved an impermissible piercing of the corporate veil.

40)       The Employer said that the Union’s proposed bargaining unit excluded the 13 Managers who reported to Peter Clifton, and that although the Union had not articulated the reason for this the Employer assumed this was because the 13 Managers were involved in determining pay, hours and holidays and generally exercised management control over the other workers in the proposed bargaining unit. The Employer went on to say that it would also be inconsistent not to exclude the “Managers’ Deputies” from the proposed bargaining unit. The Employer explained that the Managers and their Deputies worked as a managerial team, and that “this has the consequence that amongst the functions which the Deputies carry out on behalf of their Managers or which are decided in co-operation with their Manager are decisions which impact on pay, hours and holidays.” The Employer said that the same reasoning that the Union had adopted for excluding the Managers should also apply to their Deputies. The Employer said that the allocation of functions by the Employer meant that inclusion of the Deputies would give rise to a bargaining unit which was inconsistent with effective management “as it cuts across allocation of operational functions which PA Ltd have allocated to the Managers and their Deputies.” 

41)       In answering questions from the Panel, the Employer stated that, in years where there was a discretionary pay rise (rather than an across the board percentage increase) the Managers and Deputies would discuss pay increases for individual employees and put together a proposal of increases for approval.  The Employer described there being a pot for ‘managers’ and a pot for everyone else.  They confirmed that the Deputies fell within the ‘everybody else’ pot but explained that the Deputies pay increase would be removed from the pot before it was discussed in order to avoid conflict. The Employer also stated that Deputy Managers were heavily involved in disciplinary processes (if and when they were required). They added that the powers of Managers and their Deputies in respect of disciplinary processes were identical (neither had the power to dismiss).

42)       The Employer went on to say it was their view that the Deputies should be excluded from the proposed bargaining unit as well as the Managers. The Employer stated that Deputies and Managers should be treated the same for the purposes of the proposed bargaining unit because they shared much more in common “than there are differences between them”, and they each shared more in common with each other than any other categories/levels of employee. The Employer said that the Managers and their Deputies worked as a managerial team and that the Deputies, by the very nature of their role, shared managerial responsibilities, in particular in respect of pay and disciplinary processes (as set out above). The Employer continued to say that the extent to which individual Deputies would spread their time was based on factors such as the size of the team and how the Manager and Deputy choose to divide up different responsibilities. The Employer explained that this would also evolve over time and that Deputies would join and leave or others would be promoted.

43)       In addressing salary, the Employer said that for new starters this would be based on the salary of the person they were replacing. Interviews for the roles would often be conducted by the Manager and the Deputy, but on occasion the Deputy would lead the process and make the selection. Peter Clifton in his statement said “If there is reason to vary the salary – eg the person is a strong candidate and has a higher expectation – this will be discussed at Manager/Deputy level before coming to me. If a new role is being created, the need will have been discussed between the Manager and Deputy, and likely salary implications, before it is raised with me. In the past two years the pay increases have been across the board and have not involved individual Managers and Deputies. In the years when there has been some discretion, I will allocate pots of money to individual Managers. They will seek input from their Deputies before providing a recommendation on how the money should be allocated across the team. The recommendations are ultimately signed off by me.” During the hearing and when questioned by the Panel Mr Clifton said that a pot of money was given to him for the workers including Deputies with a separate pot for Managers. He confirmed that a discussion takes place between the Managers and himself as to what proportion the Deputies get, and then the rest of the pot and how it is distributed amongst the workers is determined between the Managers and their Deputies.

44)       The Employer said that a real concern was that if the Managers were excluded from the bargaining unit and Deputies are not then in the event of union recognition for collective bargaining “a wedge would be driven between Manager and Deputy, who are supposed to work hand in glove together. ” The Employer explained that it  carried  a real risk of creating an “us and them” separation which it had never had before. Mr Clifton explained “I have always considered Managers and their Deputies interchangeable in the smooth running of the various departments, with shared knowledge, responsibility and mutual trust. Keeping them together, outside the bargaining unit, will maintain this vital continuity.”

45)       The Employer concluded by saying that including the Deputies within the bargaining unit would create an artificial divide between Managers and their Deputies which was inconsistent with effective management and that effective management was achieved by Managers and their Deputies working co-operatively as a unit.

9. Considerations

46)       The Panel begins with the statutory framework. 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) state 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:

(1) the views of the employer and the union;

(2) existing national and local bargaining arrangements;

(3) the desirability of avoiding small, fragmented bargaining units within an undertaking;

(4)   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

(5)   the location of workers.

47)       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 consider any view the Employer has about any other bargaining unit that it considers would be appropriate.  The Panel must also have regard to paragraph 171 of the Schedule which provides that “In 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.”

48)       In reaching its decision the Panel has taken account of the views of the Union and the Employer as expressed in their written submissions, responses to questions and oral submissions during the hearing.

49)       The Panel’s first responsibility is to decide, in accordance with paragraph 19(2) of the Schedule, whether the Union’s proposed bargaining unit is appropriate. That does not require the Panel to determine whether it is the most appropriate bargaining unit; only whether it is appropriate. This is the overriding requirement under 19B(2) and relates principally to the matters to be collectively bargained for under the statutory regime, namely pay, hours and holidays. The requirement is that the proposed bargaining unit would be compatible with effective management, not that it be compatible with the most effective management. Against the background of that overall responsibility the Panel has to consider the matters listed in paragraph 19B(3) of the Schedule, reminding itself that these matters must not conflict with the need for the unit to be compatible with effective management.

50)       We remind ourselves that the statutory test is set at the comparatively modest level of appropriateness, rather than of the optimum or best possible outcome (see R (on the application of Kwik-Fit (GB) Ltd) v Central Arbitration Committee [2002] EWCA Civ 512, [2002] IRLR 395, [2002] ICR 1212, CA, per Buxton LJ). We should not reject the Union’s proposed bargaining unit because we consider that a different unit would be more appropriate nor, in considering whether it is compatible with effective management, should we consider whether it is the most effective or desirable unit in that context.

10. The PA Photos Ltd Workers

51)       The Panel firstly considered whether it was appropriate to have workers who were, on the face of their contracts, employed by PA Photos Ltd, as part of the bargaining unit.

52)       The Panel considered whether despite the express terms of their contracts of employment the PA Photos Ltd workers were in fact employees of PA Ltd.

53)       The case of Clark v Harvey Westwood [2021] IRLR 528 (‘Clark’) is relevant to this issue.  In Clark, the EAT held:-

“50) … it is not necessarily erroneous to look beyond the terms of the initial written agreement (even where that agreement is not said to be a sham) and to consider what transpired between the parties thereafter in order to ascertain what was initially agreed as a matter of reality. This is no more than an application of the principles established in Autoclenz”

51) … The issue [in Autoclenz] was not the identity of the employer, but whether a contract stating that the claimants were sub-contractors and not employees reflected the reality of the employment relationship. The Employment Tribunal found that it did not. The Supreme Court, dismissing the companies appeal, upheld that decision. In concluding that a different approach to the interpretation of employment contracts from that in the commercial context was justified, Lord Clarke said as follows:

“34) The critical difference between this type of case and the ordinary commercial dispute is identified by Aikens LJ in para 92 as follows:

“I respectfully agree with the view, emphasised by both Smith and Sedley LJJ, that the circumstances in which contracts relating to work or services are concluded are very often different from those in which commercial contracts between parties of equal bargaining power are agreed. I accept that, frequently, organisations which are offering work or requiring services to be provided by individuals are in a position to dictate the written terms which the other party has to accept. In practice, in this area of law, it may be more common for a court or tribunal to have to investigate allegations that the written contract does not represent the actual terms agreed and the court or tribunal must be realistic and worldly wise when it does so.

35) So the relative bargaining power of the parties must be taken into account in deciding whether the terms of any written agreement in truth represent what was agreed and the true agreement will often have to be gleaned from all the circumstances of the case, of which the written agreement is only a part. This may be described as a purposive approach to the problem. If so, I am content with that description”

54)       ‘In my judgment, the following principles, relevant to the issues of identifying whether a person, A is employed by B or C, emerge from those authorities:

a. Where the only relevant material to be considered is documentary, the question as to whether A is employed by B or C is a question of law…

b. However, where (as is likely to be the case in most disputes) there is a mixture of documents and facts to consider, the question is a mixed question of law and fact. This will require a consideration of all the relevant evidence…

c. Any written agreement drawn up at the inception of the relationship will be the starting point of any analysis of the question. The Tribunal will need to inquire whether that agreement truly reflects the intentions of the parties…

d. If the written agreement reflecting the true intentions of the parties points to B as the employer, then any assertion that C was the employer will require consideration of whether there was a change from B to C at any point, and if so how… Was there, for example, a novation of the agreement resulting in C (or C and B) becoming the employer?…

e. In determining whether B or C was the employer, it may be relevant to consider whether the parties seamlessly and consistently acted throughout the relationship as if the employer was B and not C, as this could amount to evidence of what was initially agreed…’.

55)       Applying the above criteria to the facts of this case:-

a. The question in this case  involved consideration of a mixture of documentation and facts and is therefore a mixed question of law and fact which requires consideration of all the evidence.

b. The written agreement drawn up at the inception of the relationship sets out that PA Photos Ltd is the Employer of the relevant workers.  It is clear that, for some of the employees (those employed around the establishment of PA Photos in 1999) this initially reflected the reality of the situation.  For others (those employed after the purchase of Almany in 2020), for the reasons set out at (c) below, their contracts did not reflect the reality of the situation.  The Panel finds that those workers (who were employed after 2020) were always employed by PA Ltd.

c. At the latest^{[footnote 2]}, after the purchase of Almany in 2020 and the resulting decision not to recruit any further employees to PA Photos Ltd the situation changed. Whilst PA Photos remained on all of the workers contracts of employment, the suggestion that PA Photos Ltd remained their employer became untenable:-

a. There were only 9 employees of PA Photos Ltd, all of whom were photographers and formed part of this bargaining unit.

b. The PA Photos Ltd workers worked within the structures of PA Ltd. They were line managed by PA Ltd and, if disciplinary issues arose they would be resolved by PA Ltd.

c. PA Photos Ltd workers were paid by PA Ltd and PA Ltd received no reimbursement from PA Photos to cover the costs of the workers.

d. The pay of PA Photos workers was determined by PA Ltd.

e. PA Photos workers (other than historic workers) and PA Ltd workers enjoyed identical terms of employment (save for the name of the employer).

f. In short there was no evidence that PA Photos Ltd had any involvement at all with the workers who had them named as employer on their contracts at the relevant time; They did not control the PA Photos Ltd workers (PA Ltd did – in providing line management and day to day activities and conducting disciplinary processes if necessary). They did not pay the PA Photos Ltd Workers (PA Ltd did and were not reimbursed by PA Photos Ltd).

The panel therefore finds that by 2020, at the latest, there had been a novation of the contracts (of those employees initially employed by PA Photos Ltd) such that PA Limited was substituted as the employer in the contracts of those employees of PA Photos Ltd.

56)       Having reached that conclusion, it was not strictly necessary for the Panel to determine whether or not the case of Derry Print applies and/or is correct in law. However, if it were necessary to determine the Panel finds that:-

(1) This is an exceptional case, as Derry Print and therefore if Derry Print were correct in law, it would apply on the facts of this case (for the reasons set out at paragraph 55 above).

(2) That the outcome of Derry Print is correct, although we have some doubts as to the reasoning. In particular, the Panel do not consider it helpful to talk in terms of ‘lifting the corporate veil’ which has a specific and limited meaning (see e.g. Petrodel Ltd v Prest [2013] 2 A.C. 415 at paragraph 35). There is no impropriety on the facts of this case. 

(3) We do, however, consider that, as a matter of statutory interpretation,  the principle that, for the purposes of collective bargaining two companies can be viewed as one if ‘the technical appearance of separation’ is concealed by the reality of unity’ is consistent with the purpose of Schedule A1 of TULRCA regardless of whether there is any impropriety (as would be necessary in order to pierce the corporate veil). We agree with the submission of Ms Stanley that were the conclusion to be otherwise the purpose of the Regulations, to facilitate collective bargaining would be significantly inhibited.

11. The Deputies

57)       The Panel heard evidence from both the Employer and the Union in respect of the Deputies and their role in setting pay and in disciplinary processes as well as their roles more broadly and the relationship that they had with those in Manager roles.  The Panel is grateful to all the witnesses for giving their evidence in a clear and straightforward manner and the Panel accepts that all witnesses gave an honest account of their understanding of the role of Deputies. The Panel was hampered, to an extent by the lack of evidence from either side from a current Deputy. 

58)       The Union called evidence from Ms Pennick. Ms Pennick stated that she had previously been a Deputy (approximately 10 years ago) and that, when she undertook the role, she had not been involved in any discussions around pay concerning those below her. She was also able to give anecdotal evidence regarding current Deputies who she had spoken to.  The amount of discussions that they said they had around pay varied amongst them. Ms Pennick was clear that none of them had authority to give a pay increase but accepted that at least some of them did say that they had been consulted in respect of pay.

59)       The Employer called evidence from Mr Clifton, Editor in Chief. In answer to questions from the panel Mr Clifton stated that the Managers reported to him. In respect of pay rises Mr Clifton’s evidence was that for the past 2 years there had been an across the board increase of 6%. Neither the Managers, nor the Deputy Managers, or indeed Mr Clifton had been involved in that decision.  In previous years Mr Clifton stated that there had been discretion as to the pay increases.  Mr Clifton stated that there would be one pot for Managers pay increases and one pot for everyone else (including Deputies).  Mr Clifton stated that the Deputies pay increase would be determined and removed from the ‘everyone else’ pot prior to there being a discussion as to pay increases within the team.  At this point the Deputies and their Managers would discuss pay increases within the team and agree an allocation. The Manager would then take the proposal to Mr Clifton. Ultimately neither the Managers nor Deputies would have the power to award an increase which would need to be approved by Mr Clifton.

60)       In respect of disciplinary processes Mr Clifton stated that both Managers and Deputies would have the power to run disciplinary and capability processes (including holding formal meetings).  In answering questions from the Panel, he added that neither Managers nor their Deputies would have the power to dismiss (which would need to be approved by Mr Clifton).  Mr Clifton stated that the powers of Managers and their Deputies in respect of disciplinary proceedings was the same.

61)       The Panel accepted the Employer’s evidence that if Managers were excluded from the bargaining unit and Deputies were not there was a risk of a wedge being driven between the Manager and Deputy whom are expected to work interchangeably in order to ensure the smooth running of the various departments with shared knowledge responsibility and mutual trust.

62)       Because of this (and the written evidence before us), the Panel have concluded that the proposed bargaining unit, is inappropriate. Although the bar is relatively low, it is not compatible with effective management because the inclusion of both Deputies and Managers would create an artificial divide between Managers and their Deputies which is inconsistent with effective management. We have reminded ourselves that in rejecting the proposed bargaining unit we do not do so because we feel that a different unit would be more appropriate.

12. The Appropriate Bargaining Unit

63)       Pursuant to paragraph 19(3) we must further decide a bargaining unit which is appropriate.

64)       We considered that (save for the Deputies, for the reasons set out above), the bargaining unit put forward by the Union was the most appropriate bargaining unit. The unit includes the entire editorial/content department, which is a distinct group within the Employer’s organisation save for Managers, Deputies (which are excluded for the reasons set out above) and employees of the Irish and Australian department whom we are told work in different locations and have different contracts of employment.

13. Decision

65)        The Panel’s decision is that the appropriate bargaining unit is editorial roles which ultimately report to the Editor in Chief, barring the senior management roles and the following positions (the Deputies positions):

Deputy Chief News Editor

Deputy Real Life and Social Media Editor

Lifestyle Editor

Puzzles Deputy

Deputy Editor Entertainment

Deputy Sports Editor

Scotland Deputy Editor

Group Picture Editor

Deputy Head of Video

Deputy Business Editor

Deputy Head of Production

Head of Features

Deputy Picture Editor

Page Production Editor

66)        As the appropriate bargaining unit differs from the proposed bargaining unit, the Panel will now proceed under paragraph 20(2) of the Schedule to decide if the application is valid within the terms of paragraphs 43 to 50 of the Schedule.

Panel

Ms Laura Prince, K.C., Panel Chair.

Mr Martin Kirke 

Mr Nicholas Childs

17 April 2024

14. Appendix A

Union:

Laura Davison

Natasha Morris

Mostafa Rajaai

Madeline Stanley

Emily Pennink

Jonathan Brady

Employer:

David Reade

David Poddington

Jessica Taylor

Peter Clifton

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1. In the course of drafting the decision, the Panel Chair identified two cases which appeared to be of relevance to the issue that was to be determined but which had not been identified by either party during the course of the hearing (Re Petrodel Ltd v Prest [2013] 2 AC 415 and Clark v Harvey Westwood [2021] IRLR 528. Both parties were given the opportunity to, and did, provide written submissions in respect of those cases. ↩

2. It is not necessary for the purposes of this hearing to determine the exact date of the change. ↩