Following months of talks with its unions to achieve cost savings, in October 2009, British Airways (BA) notified cabin crew of its intention to change the crew complement (levels of cabin crew) on flights, including the removal of one position from all BA Worldwide fleet flights from Heathrow.
The change prompted concerns among the cabin crew community about the impact on service standards and the increased levels of work required by reduced crew numbers.
Three staff brought claims against BA on their own behalf and on behalf of other members of cabin crew, alleging that in making these changes, BA had breached their employment contracts.
Provisions on crew complements are contained in various collective agreements between BA and the unions. There are some specific provisions, for example, providing for a complement of 15 crew on a Boeing 747 flight, and a complement of eight crew on a night-time two-class 767 flight. All of the collectively agreed provisions for crew complement numbers exceed the legal minimum required to operate an aircraft by the relevant regulator (in this case, the Federal Aviation Authority).
Notwithstanding that, the claimants argued that the crew complement provisions were incorporated into their individual contracts of employment, and that in reducing crew numbers without the consent of the cabin crew, BA had committed a breach of contract.
The claimants sought an injunction against BA preventing the continued breach of contract and damages to compensate them for the period during which BA had been in breach, in the form of compensation for each understaffed flight taken.
The High Court decided in favour of BA and confirmed that BA had not breached cabin crew contracts of employment by imposing these changes. The High Court decided that:
At no point did the parties to the collective agreements express an intention that the provisions regarding crew complement should be legally binding between BA and the unions or as between BA and each employee by incorporation into individual employment contracts; and
The terms of the collective agreement were not “apt for incorporation” into each individual employment contract. The provisions were part of a collective agreement entered into to cover the general planning and deployment of 11,500 employees, but the agreement “is not the stuff of 11,500 individual contracts”.
BA also contended that some of the employment contracts contained a clause allowing them to make reasonable changes to any terms of employment from time to time and, therefore, even if the terms of the collective agreement had been incorporated into individual contracts, BA would have been able to vary the terms under that clause.
The High Court said that, had it been asked to make a decision on this point, in view of BA’s prevailing financial circumstances, it would have decided that BA could have relied on the variation clause to reduce the crew complement numbers. But in order to be effective, such a clause must be ‘clear in its terms’ and aim to produce a reasonable result if invoked.
When considering whether collectively agreed terms are incorporated into individual employment contracts, the tribunal will take account of:
The intentions of the parties to the collective agreement
Whether the terms of the collective agreement are apt for incorporation. Generally, it will be difficult to convince the tribunal that the terms of a collective agreement are incorporated where they relate to overarching issues about the management of all employees. However, collectively agreed terms relating to individual rights – such as hours of work or periods of notice – are likely to be apt for incorporation.
Employers may be able to rely on contractual variation clauses to make unilateral changes to some contractual terms where the clause is clear and it is reasonable to make the changes in the particular context.
The High Court held that even if the terms of the collective agreement had been incorporated into the employment contracts, an injunction would not have been an appropriate remedy. The award of an injunction would have imposed an exceptional burden on BA and perhaps have jeopardised its financial recovery.
What you should do
Be clear on which collectively agreed terms are incorporated into individual contracts of employment and which are not.
Consider incorporating into every employment contract a clause reserving the right to make reasonable changes from time to time.