Veale Wasborough Vizards
07 JUL 2015
ICE agreements - what will count as an undertaking?
Associate, Veale Wasbrough Vizards
The Employment Appeal Tribunal (EAT) has held that for the purposes of the Information and Consultation of Employees Regulations 2004 (ICE Regulations), the term 'undertaking' refers to an employer as a legal entity, rather than a single establishment or place of work.
Employees are entitled under the ICE Regulations to request that their employer negotiates an agreement with them in respect of information and consultation arrangements with the workforce (an ICE Agreement).
In Moyer Lee and others v Cofely Workplace Ltd, Dr Moyer Lee and his colleagues were employees of Cofely Workplace Ltd (Cofely) working on a contract to provide facilities management services to the University of London (the University Contract). Pursuant to the ICE Regulations, they made a request that Cofely negotiate an ICE Agreement. The ICE Regulations require a request to be made by at least 10% of the employees in an undertaking in order for the employer to obliged to negotiate. In total Cofely employed around 9,200 people, at multiple sites and under a number of different service provision contracts. The application in this case was made by just 28 employees and although they represented 13% of employees working on the University Contract they only represented 0.3% of the entire Cofely workforce.
Cofely rejected the request to negotiate an ICE agreement on the basis that the required level of employee support within the 'undertaking' had not been achieved and the question was referred to the Central Arbitration Committee (CAC).
CAC agreed that the request was not valid as it determined that the term 'undertaking' for the purposes of the ICE Regulation was the legal entity, that is Cofely as the employer. The CAC rejected the proposition that each individual workplace or service contract was capable of constituting an undertaking in its own right. The employees appealed.
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The EAT dismissed the appeal. It held that upon a proper construction of the ICE Regulations, CAC was correct to decide as it did, the ICE Regulations intended an undertaking to be the legal entity which had entered into contracts of employment with the employees. As the University Contract did not constitute a legal entity it could not be considered an undertaking. The EAT also commented on the fact that 'undertaking' and 'establishment' are both defined terms within the ICE Regulations and therefore had it been the intention to limit the percentage of employee support for a request to negotiate an ICE agreement to a particular 'establishment', this would have been stated rather than using the term 'undertaking'. On this basis, the EAT held that an undertaking had to be a legal entity.
It is, of course, good practice for employers to have in place appropriate information and consultation arrangements with their employees. This not only assists with the dissemination of information in relation to any workplace changes but also fosters a collaborative way of working with staff that can enhance employee relations. An ICE agreement often provides a good framework for recording these arrangements. There are certain benefits for employers to be proactive and initiate a 'pre-existing agreement' rather than waiting for an employee request to negotiate terms. An employer will have more control over the process and there is less likelihood of standard information and consultation provision being imposed on the employer by the CAC.
We have found that in circumstances where there is no recognised trade union for the purposes of collective bargaining but the employer has clear arrangements in place to inform and consult its workforce under an ICE agreement, employees are less inclined to support an application for trade union recognition. This is because they already have a voice through their elected employee representatives who will have been appointed under the terms of the ICE Agreement. As many employers prefer to keep consultation processes in-house, an ICE Agreement can be a helpful means of achieving this, and whilst it does not preclude trade union recognition, it does "fill the space" that might otherwise lead to an application.