Definitive Report - Report No 284, November 1992

Case No 1619 (United Kingdom of Great Britain and Northern Ireland) - Complaint date: 20-DEC-91 - Closed

1. 341. The Trades Union Congress (TUC) presented a complaint against the Government of the United Kingdom in communications of 20 December 1991, 17 and 27 January 1992, alleging violations of the Labour Relations (Public Service) Convention, 1978 (No. 151). The Government sent its observations on the case in communications dated 14 February, 20 March and 3 November 1992.
2. 342. The United Kingdom has ratified the Labour Relations (Public Service) Convention, 1978 (No. 151).

A. The complainant's allegations

1. 343. The complainant organisation alleges in its communication of 20 December 1991 that the British Government does not meet its obligations under Convention No. 151, particularly in respect of the requirements to encourage and promote the full development and utilisation of machinery for negotiations of terms and conditions of employment and to seek the settlement of disputes through negotiations or through independent and impartial machinery, such as mediation and arbitration, in a manner which ensures the confidence of the parties involved.
2. 344. The Civil Service Arbitration Agreement (the "Agreement"), which has been in its present form since 1964 provides, among other things, for the determination of London Weighting (an arrangement for increasing the pay of civil servants working in London to compensate them for additional costs in the capital) to be referred to arbitration in the event of disagreement between the Government and the civil service trade unions. There have been several cases of disagreements about London Weighting being referred to arbitration in the past.
3. 345. The complainant indicates that in 1989, 1990 and 1991, negotiations with the Government have not resulted in an agreement or in any offer of improvement in the rate of London Weighting paid, and the Secretary of State for Employment refused that the issue be referred to arbitration. The Government has never suggested that arbitration is inappropriate for resolving London Weighting issues, nor that the Civil Service Arbitration Agreement is inapplicable. Its response to repeated approaches from the Council of Civil Service Unions (CCSU) has been to say that access to arbitration raises issues affecting the control of public expenditure and the development of flexible pay.
4. 346. In its communication of 27 January 1992, the complainant indicated that the trade unions concerned had received formal notice from the Government that it would terminate the agreement from 31 March 1992. That decision has been taken unilaterally notwithstanding that the trade unions, through the CCSU, said they were prepared to discuss government proposals for alternative procedures which would have the effect of denying the right of access to arbitration at the instigation of one party to the Agreement, only in the context of concurrent discussions about future pay determination arrangements.
5. 347. The complainant further submits that the decision of the Government is a grave one, and is incompatible with its minimal obligations arising from ratification of Convention No. 151. The Government is destroying machinery which has existed since 1925 for the settlement of disputes through independent and impartial machinery instead of encouraging its use, and the alternative it proposes is unlikely to secure the confidence of the trade unions concerned, given the high-handed method it adopted.
6. 348. As the Government had previously given notice of terminating the current pay determination agreements, again from 31 March 1992, and as these agreements also embody arbitration provisions, the effective situation is that, as from 1 April 1992, there will be no form of arbitration available for the 530,000 non-industrial civil servants employed by the British Government.

B. The Government's reply

1. 349. In its communication of 14 February 1992, the Government contends that its regular reports to the ILO on the application of Convention No. 151 demonstrate fully that machinery for the negotiation of terms and conditions of employment between the public authorities and public employees' organisations is not only fully developed but is also utilised extensively. The Government believes that frank and direct dialogue through this machinery is usually sufficient to ensure that matters are given full consideration and disputes resolved, though the Civil Service Arbitration Agreement has additionally provided for access to arbitration, where appropriate.
2. 350. Nevertheless, successive Governments have reserved the right on policy grounds to refuse to go to arbitration on claims which raised important policy issues (i.e. compelling reasons of national economic interest); the Government's legal advice has been that the control of public expenditure constitutes such valid grounds for refusing arbitration, since the Government is responsible to Parliament for administration of the public service. In the particular case raised by the TUC, the Government concluded that it was both reasonable and necessary to refuse arbitration on the grounds of policy.
3. 351. More importantly, however, Article 8 of Convention No. 151 clearly states that the settlement of disputes should be sought "through negotiation between the parties or through independent and impartial machinery, such as mediation, conciliation and arbitration". It does not say that negotiation and arbitration procedures both have to be available. This view is confirmed by statements from both the Committee on Freedom of Association and the Committee of Experts on the Application of Conventions and Recommendations: "... while the Government's choice to negotiate the dispute does not appear to conflict with Article 8" (Case No. 1038, 211th Report, para. 136, approved by the Governing Body at its 218th Session (November 1981)); "The Committee points out that this Article envisages alternative approaches to the settlement of disputes, namely, negotiation between the parties or recourse to an independent and impartial machinery" (Report of the Committee of Experts on the Application of Conventions and Recommendations, ILC, 1985, 71st Session, p. 354).
4. 352. The Government considers that the question of London pay is best addressed by means of targeted pay settlements, which reflect what is necessary to recruit, retain and motivate suitable staff, within what is affordable, but is always prepared to enter into negotiations with the unions on this or any other matter.
5. 353. The Government stated in its initial reply that the Civil Service Arbitration Agreement was to be terminated on 31 March 1992; in its communication of 3 November 1992, the Government indicated that the parties have recently concluded an agreement on new procedures for arbitration based on the principle of agreed access, which retain the Civil Service Arbitration Tribunal (CSAT). These arrangements replace the former Civil Service Arbitration Agreement which expired in May 1992. If a dispute cannot be resolved through negotiation or consultation, management and trade unions may wish to explore avenues for resolving the difference. Where both parties agree to refer a dispute to arbitration this will normally be to the CSAT, according to the procedure set out in the Annex to this case.

C. The Committee's conclusions

1. 354. The Committee notes that this case raised two distinct though related issues: the Government's refusal to submit the London Weighting arrangements to arbitration; and its decision to terminate the Civil Service Arbitration Agreement.
2. 355. As regards the first issue, the Committee notes that the Government concluded in this particular case that it was reasonable and necessary to refuse arbitration, a right which all successive Governments have reserved for matters raising important policy issues. The Committee also observes that the Government interprets Article 8 of Convention No. 151 as giving a choice between negotiation and other procedures, such as arbitration.
3. 356. As the Committee recalled in Case No. 1038 involving the same parties and a similar issue (211th Report, para. 136):
   • ... during discussion at the Conference of the term "as may be appropriate to national conditions", the representative of the Secretary-General stated in paragraph 63 of the Report of the Committee on the Public Service:
   • The term applied to what followed in the text and had to be interpreted in the light of the other parts of the Article which specified two different approaches to the settlement of disputes - namely, negotiation between the parties or recourse to an independent and impartial machinery, it being understood that one may follow the other. It would appear that at least one of these approaches should exist and that governments in individual countries would be free to choose in accordance with their national conditions.
   • and it was noted in the same paragraph that:
   • The Workers' members agreed that the statement of the representative of the Secretary-General corresponded to their understanding of the position. (emphasis added)
   • The Committee concluded in that case that the Government's choice to negotiate the dispute did not conflict with Article 8 of Convention No. 151; it adopted the same approach in Case No. 1147 (222nd Report, paragraph 120). The Committee of Experts also came to a similar conclusion in its 1985 report: "... the Government's refusal to commit itself to arbitration proceedings does not constitute a violation of (... Article 8)."
4. 357. The Committee cannot see any compelling reason to depart from this line of reasoning, in view of the fact that Article 8 of Convention No. 151 sets out various solutions. It considers that the Government's refusal to submit the London Weighting issue to arbitration did not amount in itself to a violation of that provision. The Committee notes from the complainant's own allegations that negotiations took place in 1989, 1990 and 1991 on the London Weighting but that they did not result in an agreement. The Committee recalls the importance which it attaches to the principle that both employers and trade unions should bargain in good faith and make every effort to come to an agreement, and that satisfactory labour relations depend primarily on the attitudes of the parties towards each other and on their mutual confidence. Constructive and real negotiations are a necessary component to establish and maintain that confidence. In this case the Committee regrets that the Government violated the Arbitration Agreement.
5. 358. Turning to the second issue, i.e. the Government's decision unilaterally to terminate the Civil Service Arbitration Agreement as of 29 May 1992, the Committee notes that this Agreement, which has been in its present form since 1964, was initially signed in 1925. It is therefore reasonable to assume that this Agreement has had the confidence of the parties involved for a long period, although its operation over the years has not been free from problems, as noted by the Committee in Case No. 1038 (op. cit., para. 125).
6. 359. In addition, the Committee regrets that the Government decided unilaterally to terminate the Arbitration Agreement. It notes however with interest that the parties were able to agree on new procedures to replace the previous Agreement, and trusts that the new agreement will provide a suitable framework for the resolution of disputes. It recalls that Article 7 of the Convention allows a degree of flexibility in the choice of procedures to be used in the determination of the terms and conditions of employment in the public service (Digest of decisions and principles of the Freedom of Association Committee, 3rd edition, 1985, para. 606).

The Committee's recommendations

1. 360. In the light of its foregoing conclusions, the Committee invites the Governing Body to approve the following recommendations:
   • (a) Whilst considering that the Government's refusal to submit the London Weighting issue to arbitration did not amount in itself to a violation of Article 8 of Convention No. 151, the Committee recalls that both employers and trade unions should bargain in good faith to come to an agreement, and that genuine and constructive negotiations are a necessary component to establish and maintain a relationship of confidence between the parties.
   • (b) However, the Committee regrets that the Government violated the Civil Service Arbitration Agreement.
   • (c) The Committee regrets that the Government decided unilaterally to put an end to the previous Civil Service Arbitration Agreement. It notes however with interest that the parties agreed on new procedures, and trusts that these new arrangements will provide a suitable framework for the resolution of disputes.

Z. ANNEX

• Procedural document on arbitration in the non-industrial civil service
• This agreement, between HM Treasury and the Council of Civil Service Unions
• (CCSU), sets out the procedures that will apply if both parties (official side
• and trade union side) to a dispute agree to seek a resolution of the
• difference by reference to the Civil Service Arbitration Tribunal (the
• Tribunal).
• Scope
  2. 2 Any dispute, except a dispute involving staff as individuals, may be
• referred to the Tribunal if the official and trade union sides concerned
• agree, but normally only a dispute affecting the remuneration, within the
• meaning of paragraph three, hours of work and leave of classes or groups of
  • non-industrial civil servants shall be considered for referral. Where a
• dispute under a Long-term Pay Agreement is referred by both parties to the
• Tribunal, the procedures set out here will be followed.
  3. 3 For the purposes of this agreement, "remuneration" means pay and allowances
• in the nature of pay but does not include pensions.
• The Tribunal
  4. 4 The Tribunal shall consist of an independent Chairman and one member drawn
• from a panel of persons representing the Official Side on the one hand, and
• the Trade Union Side on the other. The Chairman shall be a person who is
• acceptable to the parties to this agreement and will be formally appointed by
• the Secretary of State for Employment. The term of appointment shall be three
• years and the Chairman shall be eligible for re-appointment with the agreement
• of the parties to the agreement. The members of the Tribunal appointed as
• representing the Official Side will be appointed by the Secretary of State for
• Employment and will be persons who are acceptable to the Official Side. The
• members of the Tribunal appointed as representing the Trade Union Side will be
• appointed by the Secretary of State for Employment and will be persons who are
• acceptable to the Trade Union Side. Civil servants and officials of recognised
• trade unions are ineligible for appointment as members of the Tribunal. The
• members of the Tribunal shall be appointed for three years and be eligible for
  • re-appointment.
• Terms of reference
  5. 5 The parties to a dispute which is to be referred to the Tribunal shall
• endeavour to agree the terms of reference, but where that is not possible
• their respective claims shall be set out in writing, and will together
• constitute the terms of reference.
• Amendment and notice
  6. 6 The agreement may be amended by agreement between the parties and may be
• terminated by either side giving six months' notice.
  7. 7 Detailed rules of procedure which will apply are set out in the Annex.
• October 1992.