UK Supreme Court Rules in Important Collective Bargaining Case

October 2021
Region: Europe

On 27 October, the UK Supreme Court gave its judgment in Kostal UK Ltd v Dunkley & ors, concluding that Kostal had breached s145B of the Trade Union and Labour Relations (Consolidation) Act 1992, which prohibits employers from inducing workers to opt out of collective bargaining, when it made a one-off pay offer to employees while the collective bargaining process was still ongoing.

This is the first time the Supreme Court has considered s145B and the circumstances in which it is unlawful for employers to make a pay offer without the agreement of a recognised trade union via collective bargaining. It is an important decision for employers with unionised workforces and makes it clear that they need to tread very carefully if they are thinking about trying to agree pay terms directly with their employees or making an offer directly to employees where collective bargaining has stalled.

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