Meaning of ‘pre-existing agreement’ under ICE regulations: Moray Council v Stewart

Stewart v Moray Council is the first reported case from the Central Arbitration Committee (CAC) on the Information and Consultation of Employees Regulations 2004 (ICE regulations). The EAT has now upheld the CAC decision and has given guidance on the definition of a pre-existing agreement for the purposes of the ICE regulations.

The concept of a pre-existing agreement is important because if there is one in place, and it has enough employee support, an employer can fend off a request to set up an information and consultation mechanism under the regulations.

For a pre-existing agreement to be valid, it must: be in writing; cover all of the employees of the undertaking; set out how the employer is to give information to the employees or their representatives and seek their views on such information; and have been approved by the employees.

If 10% of employees in an undertaking request negotiations for an information and consultation (I&C) agreement, an employer must normally consent to that request. However, if the employer already has a valid pre-existing agreement in place and the request for negotiations has been made by less than 40% of the workforce, the employer may hold a ballot of the workforce as a whole to seek endorsement of the request. If, on a ballot, at least 40% of the employees employed in the undertaking and the majority of those who vote in the ballot vote in favour of endorsing the request, the employer must negotiate a new I&C agreement.

However, if this voting threshold is not reached, the pre-existing agreement remains valid and no further employee request for negotiations may take place for three years from the date of the original request. Hence the importance of the pre-existing agreement and making sure the qualifying conditions are satisfied to ensure it is valid.

In Stewart, the council received a request to negotiate an agreement from between 10% and 40% of its employees. The council took the view that various collective agreements in place together amounted to a pre-existing agreement, and duly decided to hold a ballot. Stewart complained to the CAC that this was not the case. The CAC then considered the four conditions for a valid pre-existing agreement, and confirmed three were satisfied. The agreements were in writing, they covered all employees (union members and non-members alike, because of the wording of the agreements), and had been approved by the employees. They were also endorsed by trade union representatives.

However, the agreement failed in one crucial respect – its insufficiently detailed description of the way the council should inform and consult employees. The agreement stated that it was ‘a forum for discussion and/or consultation on a range of matters not subject to national bargaining’. That failing meant the council was not entitled to hold a ballot, and had to start negotiations.

The EAT agreed with the CAC’s decision and took the opportunity to give some guidance on the requirements for a pre-existing agreement, as set out above.

Key points

  • If there is more than one agreement, each one must be in writing.
  • The agreement must cover all the employees. If there is more than one agreement it is not necessary for each agreement to cover all of the employees, but every employee must be covered by at least one agreement.
  • There is no requirement for each employee to have their chosen representative or for any given employee to be able in practice to influence the outcome of the consultation.
  • It must have been approved by the employees which it is intended to cover. This means approval by a majority of those employees. The ICE regulations do not specify how the agreements should be approved, but there should be evidence that the majority of employees have approved.
  • Where an agreement has been approved by a trade union, approval will normally be inferred if the majority of the staff covered at the time it was made were members of that union. An agreement with a union may cover staff who are not members of the union.
  • The agreement must set out in detail how the employer is to give information to the employees or their representatives and seek their views.

What you should do

  • If you have a pre-existing agreement, check it carefully. Make sure it satisfies all the requisite elements to be valid.
  • If your agreement is not valid, take steps to ensure it is properly drafted if you want to rely on it to defend a request to negotiate an I&C agreement.

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