Decision

Case Number: EWC/8/2013

26 July 2013

CENTRAL ARBITRATION COMMITTEE

TRANSNATIONAL INFORMATION AND CONSULTATION OF EMPLOYEES

REGULATIONS 1999 AS AMENDED BY THE 2010 REGULATIONS

DECISION ON COMPLAINT UNDER REGULATION 18

The Parties:

Mr Mick Morgan

& Mr Darryl King

and

SAFRAN Group

Introduction

1. On 15 April 2013 Mr. Mick Morgan on behalf of the shop floor of Aircelle Burnley - Union works council (JSSC) and Mr. Darryl King on behalf of the shop floor of Messier-Dowty Gloucester submitted a complaint to the Central Arbitration Committee (CAC) under the Transnational Information and Consultation of Employees Regulations 1999, as amended by the 2010 Regulations (the Regulations or TICE).

2. In accordance with section 263 of the Trade Union and Labour Relations (Consolidation) Act 1992 (the Act), the CAC Chairman established a Panel to consider the case. The Panel consisted of Professor Paul Davies QC FBA as Chairman and Ms Bronwyn McKenna and Mr. Bryan Taker as Members. The Case Manager appointed to support the Panel was Nigel Cookson.

The complaint

3. In their application Messrs Morgan and King, represented by Mr. Jonathon Hayward of Unite the Union (UNITE) acting on their behalf, explained that SAFRAN was a French company which had a European Works Council (EWC) negotiated and signed under French legislation. Aircelle, based in Burnley, and Messier-Dowty, based in Gloucester, were both UK companies with the SAFRAN Group. There were two grounds of complaint as set out below.

The First Complaint

4. The UK Management had published the final arrangements for a ballot of UK employees on 11 April 2013. The UK and French management were insisting that the process for selecting UK representatives[1] to the SAFRAN EWC was provided for under paragraphs 3 and 4 of the subsidiary requirements set out in the Schedule (the Schedule) to the Regulations. However, there was no reference in the SAFRAN EWC agreement to the Schedule as being the process for selecting UK representatives to the SAFRAN EWC.

The Second Complaint

5. In the alternative, if the Schedule did apply to the process for selecting UK Representatives, the ballot of UK employees was defective in that the Employer had failed to comply with the ballot arrangements as set out in paragraph 4(c) and (e) of the Schedule in that the Management had excluded SAFRAN employees with less than 6 months continuous service from becoming candidates in the ballot and had failed to consult with UK employee representatives on the proposed arrangements for the ballot of the UK employees.

Summary of the Employer's response to the complaints

6. The First Complaint related to the interpretation of a EWC agreement entered into on 4 July 2008 insofar as it related to the appointment of members to the EWC. The Complainants' submission was that the Schedule did not apply to the appointment of EWC members. However, it was the Employer's submission that the Schedule did apply to the extent set out below.

The First Complaint

7. As a preliminary point, the First Complaint was brought under Regulation 18 of TICE, but amounts to a submission that Regulation 18 of TICE did not apply. Such a submission would appear to be misconceived.

8. The First Complaint related to the appointment of members to the EWC, which was a matter provided for in the EWC Agreement. In order to comply with the EWC Agreement, UK members of the EWC must be appointed in accordance with the legislation applicable within the State to which the UK members belong, which was TICE.

9. In a case where the matter was not dealt with in the EWC Agreement the default provisions of the Schedule would govern the appointment of members to the EWC and paragraphs 2,3,4 and 5 of the subsidiary requirements would become the default position with respect to the appointment of members to that EWC. However, provided that an EWC agreement complied with Regulation 17(4)(b) and the other provisions set out in Regulation 17(4), the Schedule would not apply to the appointment of members to that EWC.

10. Importantly, for this case, Regulation 17(6) also allowed for the parties to agree to all or aspects of the Schedule to apply, if they so wished.

11. It was the Employer's submission that Article 2[2], 1.2.1 of the EWC Agreement had the effect of providing that the Schedule should apply to the extent to which the EWC Agreement did not already provide for the appointment or election of UK members of the EWC, and the ballot arrangements and conduct of ballot.

12. Although the Agreement stated, in Article 2, 1.2.3, that applicants presented by the trade-union would be given priority, this was subject to "compliance with the applicable local legislation", which was TICE. There was no persuasive weight to the Complainants' argument that TICE or its Schedule would need to be specifically named in the EWC Agreement in order for them to apply.

13. On the plain reading of paragraphs 3(a) and (b) of the Schedule, as UNITE did not represent all the employees as was required, it was not permissible in the absence of clear language set out in the EWC Agreement for the Employer's UK management to have simply appointed the UNITE nominated representatives.

The Second Complaint

14. The Second Complaint put forward an alternative argument that, should the Complainants be wrong about the First Complaint, the Employer had failed to comply with the relevant requirements set out in TICE. The Employer submitted that both aspects of the Complaint were unfounded.

15. Even if Regulation 18 did not apply, the process of appointing employee representatives adopted by the Employer's UK management in the UK was in compliance with TICE.

16. It appeared that the Complainants only supported those aspects of the EWC Agreement which gave UNITE members priority over other candidates, and were not making this application because they wanted the terms of the EWC Agreement to be honoured. Picking and choosing aspects of the EWC Agreement to uphold in this way indicated that the Complaint was unfounded.

17. It was at any rate inappropriate for this Complaint to have been brought under Regulation 18 as it should have been brought under Regulation 21. It had not therefore been properly brought and should not succeed.

18. As shown above in relation to the First Complaint, Regulations 17(4) and (6) allowed a EWC Agreement to set out its own rules for the appointment and election of EWC members. The EWC was entitled therefore to make the restriction in the EWC Agreement requiring at least six months' service within the business and this was an acceptable way of proceeding.

19. Regulation 17(4) did entitle the EWC to make a condition in respect of the candidacy set out in the Schedule. Regulation 17(6) stated that an agreement referred to in paragraph (4) or (5) was not subject to the provisions of the Schedule except to the extent that the parties agreed for any of the requirements to apply. It was clear that the business was entitled to rely upon the provision in the EWC agreement in relation to the six month probationary period. The reason for this was that Regulation 17(4) allowed for certain restrictions upon the operation of that requirement.

20. Insofar as the failure to consult issue is concerned in relation to the Second Complaint, it was the UK management's position that there had been consultation and that consultation started in 2008 (when the first occasion for the selection of EWC representatives arose) and that the same process was adopted in 2013. It was therefore denied that there was a failure to consult. However, in any event, there had been informal discussions on a number of occasions with the trade union in relation to the process that was to be adopted in relation to these elections, which mirrored the process and consultation that took place in 2008. The ballot was discussed in a general meeting about the EWC on 12 April 2013, in which management confirmed its position in relation to the ballot. A letter was sent to the trade union on 19 April 2013 and a discussion was held with trade union representatives in relation to the process that was to be adopted.

21. As in 2008, UK management wanted to resolve this situation but in doing so wanted to ensure that it did not become vulnerable to a complaint by individual members that they were denied the right to stand in an election and/or vote in an election for a representative which would have resulted in a breach of Regulation 31.

Parties' further comments

22. Further comments from the Complainants were received on 9 May 2013 and 23 May 2013 and further comments were received from SAFRAN on 17 May 2013 and 3 June 2013 and have been considered in full by the Panel. As they rehearsed points made earlier and in the written submissions lodged ahead of the hearing and the oral submissions made at the hearing itself, they are not repeated here.

23. Having considered the parties' submissions the Panel called for a hearing to take place in order to determine the matter. The parties were invited to supply the Panel with, and to exchange, written submissions and a hearing was held in London on 18 July 2013. The names of those who attended the hearing are set out in Appendix A of this decision.

Summary of the Complainants' written submissions for the hearing on 18 July 2013

24. UNITE submitted that the process for selecting UK EWC Representatives, to the SAFRAN EWC was not subject to paragraphs 3-5 of the Schedule as provide for under TICE. However, in the alternative, if the Panel did find that paragraphs 3-5 of the Schedule did apply to the selection process of UK EWC Representatives to the SAFRAN EWC, the Employer had failed to comply with paragraph (4) 'ballot arrangements' (c) and (e) of the subsidiary requirements.

First complaint

25. The SAFRAN EWC was a 'negotiated agreement' as provided for under Article 6 of the Council Directive 94/45/EC (the Directive) of 22 September 1994 and the subsequent French Legislation Law No 96-985 of 12 November 1996. UNITE believed that the agreement itself determined the process of selecting EWC representatives and that there was no national/local UK legislation that was applicable when selecting UK EWC representatives to a negotiated agreement.

26. In the recitals of the Directive, in particular page no: No L 254/65 paragraph 5, it specifically identified the principle of autonomy of the parties (the representatives of employees and management) 'to determine by agreement the nature, composition, the function, mode of operation, procedures and financial resources of European Works Councils... so as to suit their own particular circumstances'.

27. Article 6 of the Directive fulfilled the 'principle of autonomy' and provided for the central management and the special negotiating body to negotiate an agreement on the detailed arrangements for implementing the information and consultation of employees.

28. The Art.L 439-9 of the French Legislation transposing the Directive (Law No 96-985 of 12 November 1996 on the information and consultation of employees in Community-scale undertakings and Community-scale groups of undertakings)' fulfilled the obligations of the recitals and Article 6 of the Directive.

29. UNITE believed that the intention of the Directive was to allow the parties (the special negotiating representatives and central management) to determine through agreement, all aspects of the operation of a EWC. This included the number of representatives, the allocation of seats, how EWC representatives would be selected and the term of office of the EWC representatives.

30. The Directive, through the recitals and the Article 7, also provided for the application of subsidiary requirements, 'should the parties so decide or in the event of central management refusing to initiate negotiations or in the absence of agreement subsequent to such negotiations.' Article 7 specifically identified three circumstances whereby the subsidiary requirements should apply: a) if central management and the SNB so decide; b) where central management refuses to commence negotiations within six months of a request and (c) where, after three years from the date of this request they are unable to conclude an agreement as laid down in Article 6.

31. Under the French legislation the scope for applying the subsidiary requirements was limited to either a) 'Where the head of the Community undertaking or the dominant undertaking refuses to set up a special negotiation or to open negotiations within six months of reception of the request' or b) within three years from the date of reception of the above request or of the initiative taken by management of the undertaking or the group, the special negotiation body has not concluded an agreement.' It would appear that, unlike in the UK, under the French legislation the subsidiary requirements could not be applied by agreement of the parties but only in the absence of an agreement.

32. Section 5 'Common provisions' - Art. L 439-19 provided that 'representatives of employees on European works council set up under Art L 439-12 who had been selected by establishment and undertakings located in the member States referred to in Article L 439-6 other than France, should be elected or appointed in accordance with national rules or practice in force in those member States.' It clearly stated that only in the event that Art L 439-12 applied would national rules or practice in those member states for electing or selecting employee representatives be applicable. In the case of the UK this would be Regulation 18 of TICE to the extent it applied paragraphs 3 to 5 of the Schedule, as provided for under Regulation 4(2)(c).

33. The SAFRAN EWC agreement was a negotiated agreement and therefore Art L 439-12 did not apply and therefore the requirements provided for under Art L 439-19 could not be applied.

34. TICE identified which parts of the regulations applied to central management if (a) central management was situated in the United Kingdom or (b) whether or not the central management was situated in the United Kingdom. SAFRAN was an undertaking where the central management was situated in France and therefore only a limited number of TICE regulations applied to SAFRAN central management and the SAFRAN EWC agreement. In this case, regarding the selection of UK representatives to the SAFRAN EWC, Regulation 4(2)(c) which applied 'regulation 18 to the extent it applies paragraphs 3 to 5 of the Schedule' was relevant.

35. It was UNITE's opinion that Regulation 18 itself was not applicable but only 'paragraphs 3 to 5 of the Schedule'. Regulation 18 only applied to central management situated in the UK and where the parties had negotiated a EWC agreement within the scope of TICE.

36. As provided for under Article 7 of the Directive and the subsequent French legislation the provisions of the subsidiary requirements would only apply in the case of a EWC set up in the absence of an agreement. Therefore Regulation 18 to the extent it applied paragraphs 3 to 5 of the Schedule was only applicable and enforceable under TICE in these circumstances i.e. in the absence of an agreement for the purposes of the French legislation.

37. While an EWC agreement (where the central management was not situated in the UK) may provide that the election of UK representatives should follow the procedure as laid down in paragraphs 3 to 5 of the Schedule, this would not fall within the jurisdiction of the CAC, as the criteria and conditions relevant to Regulation 4(2)(c) would not be have been met. UNITE referred the Panel to a copy of the Nissan EWC agreement, also signed under French legislation, in support of this proposition.

38. For clarity, if an EWC was subject to the subsidiary requirements the complete provisions of the Schedule (within that Members State) would apply and therefore the election process for UK EWC representatives would fall under the scope of Regulation (4)(2)(c) and the jurisdiction of the CAC. However, if parts of the Schedule were inserted into a negotiated agreement through negotiation and agreement of the parties then this would not fall under the scope of TICE or within the jurisdiction of the CAC, but would fall under the scope of the legislation of that member state and the competent body assigned to adjudicate over negotiated EWC agreements.

39. Fundamentally, Regulation 4(2)(c) could not be classified as automatically being 'applicable local legislation'. It was only applicable in the event that the subsidiary requirements had been applied in another member state. In relation to SAFRAN that would mean Art, L 439-12 and the related Art, L 439-19 sub-paragraph 3 for the purposes of electing or appointing EWC employee representatives located in Member States other than France, which was not the case here.

40. The French Legislation also provided a good example and guidance on how a regulation would be applied to TICE if the intent was to establish a set procedure for electing or selecting UK EWC representatives to any EWC irrespective of where the central management were located. Under Art L 439-19 sub-paragraph 1 it states:

'The representatives of the employees on the European works council of the employees in the establishments or undertakings located in France, shall be appointed by the employees' trade union organisations from among their members elected to the works council of the undertaking or establishment, or among their trade union representatives in the undertaking or group, on the basis of the results of the most recent elections. The same applies with respect to the representatives of the employees in establishments or undertakings located in France belonging to a Community- scale undertaking or group having set up a special negotiating body or a European works council in a Member State other than France.'

The Second Complaint

Six months service

41. Article 2 of the SAFRAN EWC Agreement set out the criteria and process for selecting EWC representatives to the SAFRAN EWC. The criteria for selecting employee representatives was split into two key areas; 2.1.1 - conditions to be met by staff representatives - and 2.1.2 - methods for appointing members (sub-paragraphs 2 and 3 only applied to appointment of representatives outside France).

42. In order to be considered for selection as an EWC representative an employee must fulfil a number of criteria: (i) be members of the personnel of one of the European companies in the group (ii) have six months of seniority in their company of employ or the Group and have the probation period in countries where it lasts longer than six months and (iii) when there is duly constituted employee representatives body, staff representatives must hold an elected or trade union term of office within said body, if provided for by the currently applicable local legislation.

43. Criteria(i) and (ii) were quite straight forward, however criteria (iii) specifically stated that in circumstances where there was a duly constituted employee representatives' body, representatives must hold an elected or trade union term of office within said body.

44. UNITE currently had 1302 members out of a total SAFRAN UK workforce of 2056. 63% of SAFRAN UK employees were UNITE members and many more employees were covered by collective agreements negotiated by UNITE. UNITE was recognised for collective bargaining purposes at SAFRAN's largest UK sites - Aircelle in Burnley and Messier Services Ltd and Messier-Dowty Ltd in Gloucester. At each of the sites there was a trade union structure including shop stewards committees, duly elected by the Union members. Whilst the GMB was also recognised by the Employer, it had far fewer members with UNITE members making up the lion's share of trade union members across the UK sites.

45. In order to stand for nomination as a EWC representative an employee must fulfil the criteria set out in Article 2 (1.1) (iii) of the SAFRAN agreement, and so meet the requirements of the 'employee representative' described in TICE. Only the shop stewards committees of the UK SAFRAN companies where UNITE was recognised for collective bargaining could provide this mandate.

46. Indeed, SAFRAN UK management shared this view when a replacement was needed when a EWC representative failed to be re-elected as a shop steward. As he was no longer a trade union representative he lost his trade union mandate and so no longer met the criteria as required under Article 2 (1.1) (iii) of the SAFRAN agreement. In support of this point UNITE referred the Panel to email exchanges which cumulated in SAFRAN central management accepting the trade union nomination. Fundamentally, no election took place. In addition, the issue of national legislation, TICE or an election of the whole workforce was never raised. Neither did an election take place subsequently when the SNG[3] increased the number of SNG representatives within the UK by an extra seat.

47. The second criteria in the SAFRAN agreement is set out in Article 2 (1.2) which stated that: (i) the members of the European Works Council are appointed in accordance with the legislation applicable within the State to which they belong, and (ii) the applicants presented by the trade-union organisations will be given priority, where possible, subject to compliance with the applicable local legislation.

48. UNITE did not accept that there was any legislation applicable within the UK governing the selection of UK representatives to a EWC. Therefore, nominations by UNITE should be given priority and accepted as there was no legislation which would conflict with this approach.

49. Prior to the signing of the SAFRAN agreement UNITE did question the wording in Article 2 (1.2) and had raised the interpretation of this clause with management to ensure that it understood that there was no local legislation applicable to the UK. SAFRAN now claimed that TICE was the legislation applicable within the UK and which required it to apply the election procedure provided for under paragraphs 3 to 5 of the Schedule. It had not done so before. In 2008 discussions as to the process for nominating/electing UK representatives to the SAFRAN EWC cumulated in UNITE being informed that the Employer had agreed to allow the trade union to appoint the UK EWC representatives. UNITE nominated candidates were accepted by the company and no election took place.

50. Paragraph 4(2)(c) of the Schedule specifically stated that any current employee of the undertaking was entitled to stand in the ballot of the UK employees as a candidate for election as a UK member of the European Works Council. However, when SAFRAN UK management published its final ballot arrangements on 11 April 2013 it required representatives to have six months of seniority in their company of employ or the Group and have completed their probationary period if this is longer than 6 months in order to be nominated. UNITE believed that this requirement was in direct conflict with paragraph 4(2)(c) of the Schedule on the ground that it excluded any employee with less than 6 months service.

51. SAFRAN claimed it was subject to applicable local legislation but it did not comply with paragraph 4(2)(c) of the Schedule by imposing this restriction. UNITE believed that this further strengthened its case that the process for selecting UK representatives as provided for under paragraph 4(2)(c) only applied if the subsidiary requirements applied and as provided for under the French legislation 'in the absence of an agreement'. This was not the case with the SAFRAN EWC agreement.

Consultation on Ballot

52. Paragraph 4(2)(e) of the Schedule specifically stated that after it had formulated proposals as to the arrangements for the ballot of the UK employees and before it has published the final ballot arrangements, UK management must, so far as reasonably practicable, consult with the UK employees representatives on the proposed arrangements. However, this simply did not take place. UK management published its final ballot arrangements on 11 April 2013. This letter, which called for nominations, was in UNITE's view, setting out the ballot arrangements. There was no indication to the contrary. Not being satisfied UNITE lodged its complaint within the relevant time period of 21 days.

53. There was no consultation prior to the letter containing the final ballot arrangements being issued on 11 April 2013 and to which UNITE objected. On 29 April 2013 SAFRAN shared a draft letter with UNITE, and upon which it relied as the final ballot arrangements, two days before it was published on 1 May 2013. UNITE did not consider the two days in which it had to consider the letter as an adequate period of consultation.

54. In conclusion UNITE contended that the SAFRAN EWC agreement was a negotiated agreement and so Art L 439-12 of the French legislation, which provided for 'European works council set up in the absence of an agreement' (the subsidiary requirements), did not apply. Therefore, Regulation 18 to the extent it applied paragraphs 3 to 5 of the Schedule, as provided under Regulation 4(2)(c), did not apply in this case. Regulation 18 and the provisions of the Schedule only applied to central management situated in the UK and the parties negotiating a EWC agreement within the scope of TICE.

55. The SAFRAN agreement stated that a representative must hold an elected or a trade union term of office and that applicants presented by the trade union organisations would be given priority, subject to compliance with applicable local legislation. There was no local legislation in relation to the selection of UK representatives to a EWC and therefore trade union nomination should automatically be accepted. In addition, in order to have an elected trade union term of office, applicants must be nominated from trade union recognised areas where shop steward structures were in place.

56. If the Panel did find that the Schedule and the subsidiary requirements applied in this case, SAFRAN failed to comply with paragraph (4)(c) in refusing employees with less than 6 months service the opportunity to stand as a candidate and also (e) by not consulting with employee representatives on the proposed arrangements for ballot of the UK employees.

Summary of the Employer's written submissions for the hearing on 18 July 2013

57. The first complaint was that the balloting provisions of the subsidiary requirements did not apply. The Complainants say that EWC members should be appointed in accordance with the terms of the EWC Agreement only, which did not incorporate TICE and the subsidiary requirements.

58. If the Complainants were wrong and the subsidiary requirements did apply, they alleged that the Employer was in breach of the subsidiary requirements by:

a. applying the requirement in the EWC Agreement that members must have 6 months' service to be a EWC representative (para 4(2)(c) of the subsidiary requirements); and

b. failing to consult UNITE about the arrangements for the ballot (para 4(2)(e) of the subsidiary requirements).

The First Complaint

59. SAFRAN was a Community-scale undertaking with its central management based in France. It negotiated arrangements for a EWC with various unions across Europe. A number of its employees in the UK were members of UNITE and the GMB (and there may be other union membership of which the Employer was not aware). The EWC Agreement was signed and dated 4 July 2008. It was in French but there was an agreed English version, although the definitive version to be construed in any dispute was the French original. It was subject to French law. The English version records that the agreement sets up a EWC the purpose of which was to represent all the employees in the Group present in the EEU.

60. The complaint arises from the true construction of clauses 1.2.1 and 1.2.3 of article 2 of the EWC Agreement:

«Les membres du Comité d'Entreprise Européen sont désignés conformément à la législation applicable dans leur Etat d'appartenance.»[4]

«Pour ce qui concerne les autres délégations Européennes, les candidatures présentées par les organisations syndicales seront, si possible, privilégiées, sous réserve de la loi locale applicable.»[5]

61. In a nutshell, the Complainants suggested that on a true construction of the EWC Agreement, the parties were not agreeing to incorporate the provisions of TICE (and in particular the balloting provisions contained in the Schedule) by those words. The Employer interpreted those words as incorporating the TICE Regulations as the "loi locale applicable" or the "législation applicable" and thus provided a fair and proper process for election of representatives as part of the EWC.

62. Alternatively, the Employer submitted that even on the Complainants' construction of the EWC agreement (that unions should simply be given 'priority', but that the agreement provides no further guidance as to what form the 'priority' was to take) a ballot would have been necessary because in the UK the Employer recognised more than one trade union. It would be required to afford an equal opportunity to each trade union, not simply one of them. Therefore, even on the Complainants' construction, a ballot of the workforce would be required as the other unions may put forward candidates for the EWC.

63. The construction of a contract written in French and governed by French law was plainly a matter that was not easily undertaken in the CAC or indeed by English lawyers. Happily, this eventuality was taken out of the hands of the CAC as Regulation 21(1) only gave jurisdiction to hear complaints about a EWC established under Regulations 17 or 18.

64. The EWC was established by agreement between management and a special negotiation group in a manner akin to Regulation 17, but was not established under Regulation 17. This was because it was the EWC for a Community-scale undertaking with its central management situated in France. Regulation 4(1) only applied Regulation 17 to Community-scale undertakings with central management in the UK. Regulation 17 was not listed in Regulation 4(2) as one of the Regulations which applied whether or not the central management was in the UK. Although Regulation 18 was one of the Regulations which applied wherever the central management was situated, the EWC was not established under the Schedule, but by formal agreement reached between the Employer and various unions from across Europe.

65. This appeared to be a position common to both parties. In its letter to the CAC dated 9 April 2013 (probably intended to be 9 May 2013) UNITE agreed that only those Regulations listed in Regulation 4(2) applied to SAFRAN.

66. Regulation 17 had no application to SAFRAN and no application to this EWC on the basis that the EWC was not established under Regulation 18. In these circumstances, there was no jurisdiction under Regulation 21(1). It would be for the relevant French Court to construe the EWC Agreement to decide whether the balloting provisions of the Schedule were incorporated by agreement into the EWC Agreement. Indeed, that would be the only convenient forum for such an enquiry having regards to the factual matrix involving unions from a number of different jurisdictions with different balloting or appointment provisions in their local legislation.

67. In any event, the Complainants did not have locus standi to bring a complaint under Regulation 21 as where the alleged failure concerned a EWC, the only parties that could complain (the 'relevant applicant') were the central management or the EWC itself. If the CAC decided that it did have jurisdiction under Regulation 21 and the Complainants had locus standi then the CAC would need to make directions for further evidence including provision for French law experts and any necessary interpreters.

The Second Complaint

68. The Second Complaint, under para 4(3) of the Schedule, was that selection arrangements did not comply with TICE and the balloting arrangements were published before consultation with UNITE. Neither of these are meritorious points. UNITE had not put forward any candidate with less than 6 months' service and it was difficult to see any circumstances where it would be appropriate for a brand new employee to stand as a EWC representative. UNITE had no quarrel with the arrangements for the ballot which was carried out very properly by ERS. However, both points were also legally unmeritorious for the reasons set out below.

Six months' service

69. It was right that paragraph 4(2)(c) of the Schedule provided that any UK employee was entitled to stand as a candidate. If the Schedule applied because there had been no negotiations for a EWC (Regulation 18(1)(b)) or because negotiations had failed (Regulation 18(1)(c)) then the Employer would have to abide by the unvarnished requirements of the Schedule.

70. However, the provisions of the Schedule applied only because the "parties so agree" (Regulation 18(1)(a)) and therefore derived their force from this agreement. The parties to a EWC agreement were contractually free to agree anything they wanted. The Regulations did not circumscribe what must be contained within a EWC agreement (particularly as the partially determinative provisions of Regulation 17(4) did not apply to this EWC Agreement). The parties were therefore free to agree that all, some or none of the subsidiary requirements set out in the Schedule applied in this particular case.

71. The parties to this EWC Agreement had agreed a number of provisions which the CAC must respect and uphold. When the EWC Agreement provided in clause 1.2.1 of article 2 that members were appointed in accordance with [the subsidiary requirements], that must be read with the implied words "except as already expressly agreed in the EWC agreement". The parties cannot be taken to have agreed two contradictory provisions and so any court or tribunal, French or English, needs to resolve the inconsistency.

72. In the EWC agreement there was an expressly agreed clause in clause 1.1 of article 2 requiring staff representatives to have "six mois d'ancienneté" i.e. six months' service. The incorporated terms of the Schedule must, as a matter of common sense, take effect subject to any modifications expressly agreed between the parties. It was submitted that the CAC could accept this submission on first principles without needing the expense and delay associated with looking at the French Law on incorporation of contractual terms.

73. UNITE representatives were entitled, under para 4(3) of the Schedule, if they believed "that the arrangements for the ballot of the UK employees were "defective" to bring a complaint within 21 days of publication of the final arrangements under paragraph (f) (which occurred on 1st May 2013). However UNITE was itself party to the arrangements that it now complained was defective. UNITE representatives could not complain to the CAC when UNITE industrially agreed, and continued to agree, that nominating employees with 6 months' service to be EWC representatives was a proper approach. Although there may not be a formal estoppel in these circumstances, UNITE should not be permitted to resile from its agreement to the EWC terms - including clause 1.1 of article 2 of the EWC Agreement.

74. It would not make any industrial sense for the CAC to declare or order the UK management to breach the EWC Agreement which had not just been agreed with UNITE, but with all the other European unions. It was not appropriate to order the Employer to modify the arrangements it had made for a full and proper ballot of the UK employees in these circumstances.

Consultation on Ballot

75. The final part of the Second Complaint was hopeless. The final arrangements for the ballot of UK employees was published to employees in accordance with para 4(2)(f) of the Schedule on 1 May 2013. The arrangements were for a 'first-past-the-post' ballot whereby each UK employee could vote for one candidate by post or electronically.

76. The Employer first consulted in accordance with the Schedule in 2008, leading to the initial appointment of EWC representatives - as the same arrangements were proposed in the present case. In any event, fresh consultation then took place with UNITE long before 1 May 2013:

a. by email of 26 March 2013 from Jonathan Hayward of UNITE copied to Rachel McGlothen of SAFRAN, in which UNITE made full objections to the proposals for a full ballot of the UK workforce and argued that UK balloting legislation did not apply under the EWC Agreement.

b. by a letter from Mr Hayward dated 8 April 2013 to Ms Arlette Ruraye of SAFRAN in which UNITE nominated representatives and by a EWC meeting on 12 April 2013 at which the proposals for a ballot were discussed.

c. by invitation by SAFRAN for nominations on 10 April 2013.

d. by letter on 15 April 2013 and 19 April 2013.

e. on 29 April 2013 when SAFRAN shared a draft of the final arrangements with UNITE before publishing its final arrangements for the ballot of the UK employees on 1 May 2013.

f. by email from Mr Sutcliffe of UNITE on 29 April 2013 once again disagreeing with the balloting arrangements and suggesting that each UK employee received four votes.

77. The complaint, which was made on 15 April 2013, was premature as it should not have been presented until the period beginning with the publication of the final arrangements under para 4(3) of the Schedule and accordingly, the CAC did not have jurisdiction to determine the matter. Further, the substantive point was that consultation commenced in March 2013 and was not concluded until just before 1 May 2013, when the final balloting arrangements were published to all employees and full and proper consultation did take place. The Employer referred the Panel to the case of UNITE the Union & Easyjet, EWC/4(2008, 23 July 2008 before a differently constituted panel of the CAC in support of this very point.

78. Finally, the Employer pointed out that the complaint was to some extent academic, because the two candidates elected as main representatives to the EWC (in fact the Complainants) were UNITE's preferred nominees (although different employees were elected as substitute representatives).

Considerations

79. Although it does not appear very clearly from the Union's legal arguments on behalf of the employee representatives, their central concern in this case appears to be that proper effect is not being given to the provision in the SAFRAN European Works Council agreement of 4 July 2008 that:

With regard to other [ie non-French] delegations, the applicants presented by the trade union organizations will be given priority, where possible, subject to compliance with the applicable local legislation. (Art. 2.1.2.3 of Section II of the agreement)

80. As appears from the letter of 11 April 2013 from SAFRAN to its UK employees, the method of selecting the UK representatives on the SAFRAN works council consists of holding a ballot in which the candidates are any employee of six months' seniority who has put him- or herself forward or has agreed to be put forward as a candidate. There is no formal priority granted to the Union in this process. The Union's position is that it should appoint both of the UK members of the SAFRAN EWC (and their alternates).

Complaint based directly on the EWC Agreement

81. The obvious way to present this concern is as a complaint that the Employer is not abiding by the terms of the EWC agreement. However, the union, somewhat surprisingly, argues that the complaint cannot be presented in that way before the Central Arbitration Committee. The Employer, less surprisingly, agrees. Since the matter is not in dispute between the parties, we need say little about it. Where, as here, the central management of the Community-wide group is based outside the UK, only certain of the provisions of the UK rules, the Transnational Information and Consultation Regulations 1999, as amended, apply. See Reg. 4(2). A complaint of non-compliance with an EWC agreement may be made under Regulation 21 to (now) the CAC, but Regulation 21 is not one of the UK regulations which is made applicable by Regulation 4(2) where the central management of the group is outside the UK. Even if Regulation 21 were applicable, the Complainants in this case are not 'relevant applicants' with Regulation 21. Right of complaint under Regulation 21 is given to the central management of the group and to the European Works Council but not to employee representatives (Regulation 21(3)(a)). It appears that if a complaint of non-compliance with the agreement is to be made in this straightforward way, it will have to be made to the relevant French court, which we understand to be the Tribunal de Grande Instance in Versailles.

The applicability of paras 3 to 5 of the Schedule to the TICE Regulations

82. The alternative way of presenting the complaint is that the Employer has failed to comply with paras 3 to 5 of the 'subsidiary requirements' in the Schedule to the 1999 Regulations. This was very much the Union's secondary argument in its written submissions, probably because its view was that it could not raise its central complaint in this way. The only arguments it could advance under the subsidiary requirements were that the six-month seniority rule was inconsistent with the subsidiary requirements and that the union had not been properly consulted with respect to the ballot arrangements.

83. The Employer and the Union differed as to the basis for the applicability of the subsidiary requirements. The Employer took the obvious argument that they were applied in virtue of Regulation 18(1)(a), ie because the parties had agreed to apply them. Since the central management of the SAFRAN group is outside the UK, Regulation 4(3)(c) makes it clear that only paras 3 to 5 of the Schedule are applied by Regulation 18, but to that limited extent, the Employer argued, the subsidiary requirements applied because of the parties' agreement. That agreement was to be found in Article 2.1.2.1 of the SAFRAN European Works Council Agreement, which states:

The members of the European Works Council are appointed in accordance with the legislation applicable within the State to which they belong.

84. Bearing in mind the provisions of Regulation 17(6) that an EWC agreement is subject to the provisions of the Schedule only to the extent that the 'parties provide in the agreement that any of those requirements are to apply', we nevertheless think that the above Article is just about enough to subject the agreement to the provisions of the Schedule. We are mindful of the fact that, if the above Article is not enough to trigger paragraphs 3 to 5, then the agreement will have failed to specify any method for selecting the UK representatives. No set of rules, other than those contained in paragraphs 3 to 5 of the Schedule, were suggested to us as UK rules to which the agreement referred. Although the remainder of Article 2 contains certain provisions relating to the selection of employee representatives, without the importation of the applicable local legislation it seems to us that Article 2 does not provide a workable set of rules for electing representatives.

85. The Union, on behalf of the representatives, agreed that paragraphs 3 to 5 of the Schedule applied, but argued that Regulation 18 did not. We cannot accept this argument. The Schedule applies only if it has been 'triggered' by Regulation 18; it does not apply independently of Regulation 18, as both the wording of Regulation 18 and the heading of the Schedule (which refers back to Regulation 18) make clear. The Union's argument seems to have been influenced by its reading of the French legislation which, it says, does not contain a provision applying the subsidiary requirements in a case where the parties agree to apply them. Whether this is an accurate reading of the French legislation or not, the French legislation seems to us irrelevant to our interpretation of this aspect of the UK Regulations. The UK Regulations transpose in the UK the provisions of Council Directive 94/45/EC (the relevant directive for the SAFRAN agreement) and Article 7 of that Directive provides that the subsidiary requirements 'shall apply . . . where the central management and the special negotiating body so decide.' Thus, Regulation 18(1)(a) of the UK Regulations appears as a straightforward read-across of this provision of Article 7 of the Directive.

86. We thus conclude that paragraphs 3 to 5 of the Schedule apply in this case by virtue of the provisions of Regulation 18(1)(a). This being so, Mr Morgan and Mr King have standing as employees to complain under para 4(3) that the arrangements for the ballot organised by SAFRAN management in the UK in May 2013 were defective.

Was the complaint timely?

87. Paragraph 4(3) provides that the complaint by a UK employee or employee representative may be presented 'within a period of 21 days beginning on the date the UK management published the final arrangements under paragraph (f)' and paragraph 4(2)(f) requires UK management to publish the final arrangements 'in such a manner as to bring them to the attention of, so far as reasonably practicable, the UK employees and the UK employees' representatives.' We note that Regulation gives both a starting and a finishing date for the window within which the complaint may be presented and not just a finishing date.

88. The complaint in this case was presented on 15 April 2013. The Union relies on a letter of 11 April, sent to all employees, inviting nominations by 22 April for the two UK seats on the EWC (and two alternates) and stating that, after nominations had closed, a ballot would be held. The attached documentation made it clear that candidates were required to have six months' service within the SAFRAN group. This is one of the requirements for being a representative which is stipulated in Article 2.1.1 of the Agreement. Since this letter contained the service requirement of six months, to which the Union objects, and also made it clear that the Union was to be given no priority in the nomination of candidates for the ballot, the two Complainants initiated the present complaint.

89. There was a further letter from SAFRAN UK management to all employees, dated 1 May 2013. This referred to the previous letter of 11 April and invited employees to vote, stated how the representatives and their alternates would be selected on the basis of the votes cast, gave details as to how to vote and the date by which votes had to be received and encouraged employees to read the enclosed election addresses.

90. The Employer contends that the 'final arrangements' letter was the letter of 1 May. Since the Union had already filed its complaint on 15 April, the Employer says it was premature. We think this argument is correct. In particular, we think that the 'final arrangements' must include details of how and when to vote and the rules for identifying the winning candidates. We also think the Union has some reason to feel aggrieved about the drafting of the Regulations on this point. The 11 April letter was the final statement by the Employer of its position on the seniority requirement for candidates, whose nomination it was then seeking. However, the final arrangements for the ballot were published, it seems to us, only on 1 May and it was then that the 21 day period for filing a complaint relating to the arrangements for the ballot began to run.

91. Since we conclude that the second way of putting the complaint fails on these procedural grounds, we could stop there. We do not do so, for two reasons. First, the Employer, aware no doubt of the highly technical nature of its defence, dealt fully with the two substantive criticism advanced by the Union on behalf of the Complainants, ie the legality of the six month seniority rule and the adequacy of the pre-ballot consultation. In deference to the arguments both Employer and Union addressed to us on these issues, we say something about them. Second, we believe and hope that our views on these issues may help the parties to resolve by agreement the central concern of the Union in this case, namely, the lack of union priority in the selection arrangements for the UK representatives.

Adequacy of the consultation

92. Paragraph 4(2)(e) of the Schedule requires UK management to consult with UK employees' representatives on the proposed arrangements for the ballot of UK employees, once it has formulated proposals as to the arrangements for the ballot. Both before and after the letter of 11 April there was an exchange of correspondence between Union and Employer, the Union saying it was entitled to nominate UK representatives to the EWC (for example, the letter of 8 April from Mr Hayward of the Union to Ms Arlette Ruraye of SAFRAN). For its part the Employer maintained that it was obliged to hold a ballot under the terms of the EWC Agreement (see, for example, the letter from M. Baeny to Mr Hayward of 19 April). The Union complains that the Employer did not alter its position and so there was no genuine consultation, but, given the very different views the two sides held as to what the EWC Agreement required, we do not think that in this instance consultation could be expected to achieve very much beyond a clear statement of each party's position.

The six month seniority rule

93. The Employer applies a six-month seniority rule to employee representatives on the SAFRAN EWC, no matter whether they are French or non-French representatives. This condition is laid down in Article 2.1.1 of the EWC Agreement. This restriction on who may be an employee representative is not to be found in the provisions of the Schedule to the UK Regulations. That provides in terms that any employee of the group can stand as a candidate (para 4(2)(c)). How should this contradiction between the Schedule and the Agreement be resolved?

94. One approach would be to say that, once the agreement adds to or subtracts from the subsidiary requirements, Regulation 18(1)(a) ceases to have effect. The parties either agree on the subsidiary requirements as a package or they fall outside Regulation 18. Mr Burns, on behalf of the Employer, argued, on the contrary, that all, some or none of the subsidiary requirements could apply, depending on what the parties agreed. We think the Employer's approach is the better one. This approach seems, for example, to reflect better the provisions of Regulation 17(6), noted above, which contemplates the agreement being subject to only some of the subsidiary requirements. In this case, therefore, if we had been required to decide the matter, we would have held that the parties had disapplied the 'every employee can be a representative' rule of the Schedule and replaced it with the six-month seniority rule.

95. However, this approach is not free from difficulty. In particular, it is not clear to the Panel whether the Employer's argument was that the CAC has jurisdiction under Regulation 18 and para 4 of the Schedule only over the subsidiary requirements which had not been modified by agreement or over all those requirements, modified and unmodified. For example, should the Employer unilaterally extend the six-month seniority rule to twelve months, would the CAC have jurisdiction to rule, on a timely complaint, that the arrangements for a ballot which excluded employees with more than six months' but less than twelve months' seniority was a breach of para 4 of the Schedule? Without giving a definitive view on the issue, we incline towards the broader approach.

96. In particular, the broader approach seems to us to give better effect to Article 11 of the Directive. This provides:

Each Member State shall ensure that the management of . . . undertakings which form part of a Community-scale group of undertakings which are situated within its territory . . . abide by the obligations laid down by this Directive, regardless of whether or not the central management is situated within its territory.

We think it is clear that one of the obligations created under the Directive is the obligation on both parties to abide by the European Works Council agreement, where one is agreed. Regulation 21 of the UK Regulations constitutes a recognition of this obligation. Under the SAFRAN agreement, selection of the employee representatives is to be determined by the locally applicable legislation, which implies that the primary responsibility for implementing this part of the agreement lies with local management. Thus the UK management of the SAFRAN group led the way in organising the UK ballot.

Union priority again

97. It is thus strongly arguable that (i) under the principle of the autonomy of the parties, the parties are free to modify the subsidiary requirements without losing the protection of Regulation 18(1)(a) and (ii) that the CAC has jurisdiction to consider timely complaints relating to non-compliance with the subsidiary requirements, as modified. It seems to us that this approach fits well with the structure of the Directive and of the SAFRAN Agreement. The Directive relies on national law and practice for the selection of the members of the special negotiating body and European works council. As the Recitals to Directive 94/45/EC state: "Whereas, in accordance with the principle of subsidiarity, it is for the Member States to determine who the employees' representatives are . . ." (A similar provision appears as Recital 20 of the re-cast Directive (2009/38/EU).) As we noted in the previous paragraph, the SAFRAN Agreement adopts the same approach. Unless the CAC has this broader version of jurisdiction in relation to the subsidiary requirements, the undesirable consequence would be that the parties would have to have resort to a French court for a decision on the selection process for the UK representatives whenever a modified provision of the subsidiary requirements was in issue. The French court, in order to provide a workable answer, would have to become well-informed about national law and practice in the UK, a position which it might not be well-placed to achieve.

98. Finally, it appears to us that the approach we favour in relation to the six-month seniority rule (and for which the Employer has argued) has implications for the union priority clause in the agreement. As noted at the beginning of these Considerations, that agreement contains a commitment on the part of the Employer that 'applicants presented by the trade-union organizations will be given priority, where possible, subject to compliance with applicable local legislation.' As we also noted there, the selection arrangements put in place in May 2013 gave no priority to union candidates. Union candidates in fact took both representative places and one of the alternates because the employees voted for them, not because of any priority they were accorded in the selection process.

99. We think that the Employer has taken too strict and unimaginative a view of the qualifications to the union priority rule. First, as to applicable local legislation, the only relevant rules brought to our attention were the subsidiary requirements of the Schedule. Since on the Employer's own argument, the provisions of para 4(2)(c) can be modified by agreement to introduce six-month seniority rule, the Schedule does not stand in the way of further modification by agreement to introduce union priority.

100. Second, as to 'where possible', the Employer apparently considers that, because the Union has bargaining rights only in respect of some (though the majority) of the employees of the SAFRAN companies in the UK, it is not possible to give effect to a union priority principle. The position, as we understand it, is that the Union is not recognised in a number of smaller SAFRAN UK companies, which together employ about one quarter of the total UK workforce. We are not convinced that this means that no meaning can be attached to the notion of union priority. Whilst it may not reflect the representational realities within the SAFRAN UK companies to give UNITE the right simply to appoint all the UK members (and alternates), it is possible to think of a number of feasible positions between that situation and the current arrangements where union priority is simply non-existent in the UK. Union priority does not mean union exclusivity; on the other hand, it must imply something more in the Union's favour than the arrangements put in place in May this year. For example, UNITE might be given the right to appoint one representative (and the alternate) with the other pair being appointed in a ballot in which the Union's nominees were clearly identified as such. We are not saying that this is the right solution in industrial relations terms. What we do say is that we believe that, with imagination, the principle of union priority which is enshrined in the EWC Agreement could be made much more meaningful in the UK than it currently is. Our impression is that relations between the parties are good and that it should not be impossible for them to reach a negotiated solution to this issue, perhaps with the help of a third party.

101. We should make it clear that do not place any reliance on the provision in Art 2.1.1 of the EWC Agreement that 'where there is a duly constituted employee representation body, (représentation du personnel), staff representatives must hold an elective or trade-union term of office (mandat) within said body, if provided for by the currently applicable local legislation.' Whether an 'employee representation body' can be equated with a recognised union representing a majority but not all of the workforce is a matter on which we would need more evidence, should it ever become necessary to decide the point. By contrast, the principle of union priority raises no such issues of comparative institutional equivalence.

Concluding remarks

102. We are grateful to Mr Burns for the Employer and Mr Hayward for the complainants. They both put in helpful and extensive written submissions, made clear oral submissions and dealt with Panel's probing questions with good humour and perspicacity.

Decision

103. The complaints made by Mr Morgan and Mr King about the arrangements made for the ballot held by the SAFRAN UK management in May 2013 are dismissed.

The Panel

Professor Paul Davies QC FBA - Chairman of the Panel

Ms Bronwyn McKenna

Mr Bryan Taker

26 July 2013

Appendix 1

Names of those who attended the hearing on 18 July 2013:

For the Complainants

Mr Jonathon Hayward - International Officer, Unite the Union

Mr Mick Morgan

Mr Ray Sutcliffe

For the Employer

Mr Andrew Burns - Counsel

Mr Vince Toman - Solicitor, Lewis Silkin LLP

Mr Tarun Tawakley - Solicitor, Lewis Silkin LLP

Ms Rachel McGlothlen - Senior HR Manager, Messier-Dowty Ltd

Mr Claude Mathieu - Senior Vice President, HR EMEA, Safran

Appendix 2 - Provisions of the TICE Regulations considered by the Panel

1) Regulation 4 states:

Circumstances in which provisions of these Regulations apply

4.-(1) Subject to paragraph (2) the provisions of regulations 7 to 41 and of regulation 46 shall apply in relation to a Community-scale undertaking or Community-scale group of undertakings only where, in accordance with regulation 5, the central management is situated in the United Kingdom.

(2) The following regulations shall apply in relation to a Community-scale undertaking or Community-scale group of undertakings whether or not the central management is situated in the United Kingdom-

(a) regulations 7 and 8(1), (2) and (4) (provision of information on employee numbers);

(b) regulations 13 to 15 (UK members of the special negotiating body);

(c) regulation 18 to the extent it applies paragraphs 3 to 5 of the Schedule (UK members of the European Works Council);

(d) regulations 23(1) to (5) (breach of statutory duty);

(e) regulations 25 to 33 (protections for members of a European Works Council, etc.);

(f) regulations 34 to 39 (enforcement bodies) to the extent they relate to applications made or complaints presented under any of the other regulations referred to in this paragraph;

(g)regulations 40 and 41 (restrictions on contracting out).

2) Regulation 17 states:

Content and scope of a European Works Council agreement and information and consultation procedure

17.-(1) The central management and the special negotiating body are under a duty to negotiate in a spirit of cooperation with a view to reaching a written agreement on the detailed arrangements for the information and consultation of employees in a Community-scale undertaking or Community-scale group of undertakings.

(2) In this regulation and regulations 18 and 20, the central management and the special negotiating body are referred to as "the parties".

(3) The parties may decide in writing to establish an information and consultation procedure instead of a European Works Council.

(4) Without prejudice to the autonomy of the parties, where the parties decide to proceed with the establishment of a European Works Council, the agreement establishing it shall determine-

(a) the undertakings of the Community-scale group of undertakings or the establishments of the Community-scale undertaking which are covered by the agreement;

(b) the composition of the European Works Council, the number of members, the allocation of seats and the term of office of the members;

(c) the functions and the procedure for information and consultation of the European Works Council and arrangements to link information and consultation of the European Works Council with information and consultation of national employee representation bodies;

(d) the venue, frequency and duration of meetings of the European Works Council;

(dd) where the parties decide that it is necessary to establish a select committee, the composition of the select committee, the procedure for appointing its members, the functions and the procedural rules;

(e) the financial and material resources to be allocated to the European Works Council; and

(f)the date of entry into force of the agreement and its duration, the arrangements for amending or terminating the agreement, the circumstances in which the agreement is to be renegotiated including where the structure of the Community-scale undertaking or Community-scale group of undertakings changes and the procedure for renegotiation of the agreement.

(4A) In determining the allocation of seats under paragraph (4)(b), an agreement shall, so far as reasonably practicable, take into account the need for balanced representation of employees with regard to their role and gender and the sector in which they work.

(5) If the parties decide to establish an information and consultation procedure instead of a European Works Council, the agreement establishing the procedure must specify a method by which the information and consultation representatives are to enjoy the right to meet to discuss the information conveyed to them.

(6)An agreement referred to in paragraph (4) or (5) is not to be subject to the provisions of the Schedule, except to the extent that the parties provide in the agreement that any of those requirements are to apply.

(7) Where a Community-scale group of undertakings comprises one or more undertakings or groups of undertakings which are themselves Community-scale undertakings or Community-scale groups of undertakings, the European Works Council shall be established at the level of the first-mentioned Community-scale group of undertakings, unless an agreement referred to in paragraph (4) provides otherwise.

(8) Unless a wider scope is provided for in an agreement referred to in paragraph (1), the powers and competence of a European Works Council and the scope of an information and consultation procedure shall, in the case of a Community-scale undertaking, cover all the establishments located within the Member States and, in the case of a Community-scale group of undertakings, all group undertakings located within the Member States.

(9) Where information disclosed under a European Works Council agreement or an information and consultation procedure includes information as to the employment situation in the Community-scale undertaking or, as the case may be, the Community-scale group of undertakings, this shall include suitable information relating to the use of agency workers (if any).

3) Regulation 18 states:

Subsidiary requirements

18.-(1) The provisions of the Schedule shall apply if-

(a) the parties so agree;

(b) within the period of six months beginning on the date on which a valid request referred to in regulation 9 was made, the central management refuses to commence negotiations; or

(c) after the expiry of a period of three years beginning on the date on which a valid request referred to in regulation 9 was made, the parties have failed to conclude an agreement under regulation 17 and the special negotiating body has not taken the decision under regulation 16(3).

4) Regulation 21 states:

Disputes about operation of European Works Council or information and consultation procedure

21.-(1) Where-

(a) a European Works Council or information and consultation procedure has been established under regulation 17; or

(b) a European Works Council has been established by virtue of regulation 18,

a complaint may be presented to the CAC by a relevant applicant where paragraph (1A) applies.

(1A) This paragraph applies where a relevant applicant considers that, because of the failure of a defaulter-

(a) the terms of the agreement under regulation 17 or, as the case may be, the provisions of the Schedule, have not been complied with; or

(b) regulation 18A has not been complied with, or the information which has been provided by the management under regulation 18A is false or incomplete in a material particular.

(1B) A complaint brought under paragraph (1) must be brought within a period of six months beginning with the date of the alleged failure or non-compliance.

(2) In this regulation, "failure" means an act or omission and a failure by the local management shall be treated as a failure by the central management.

(3) In this regulation "relevant applicant" means-

(a) in the case of a failure concerning a European Works Council, either the central management or the European Works Council; or

(b) in the case of a failure concerning an information and consultation procedure, either the central management or any one or more of the information and consultation representatives,

and "defaulter" means the persons mentioned in sub-paragraph (a) or (b) against whom the complaint is presented.

(4) Where the CAC finds the complaint well-founded it shall make a decision to that effect and may make an order requiring the defaulter to take such steps as are necessary to comply with the terms of the agreement under regulation 17 or, as the case may be, the provisions of the Schedule.

(5) An order made under paragraph (4) shall specify-

(a) the steps which the defaulter is required to take;

(b) the date of the failure; and

(c) the period within which the order must be complied with.

(6) If the CAC makes a decision under paragraph (4) and the defaulter in question is the central management, the relevant applicant may, within the period of three months beginning with the date on which the decision is made, make an application to the Appeal Tribunal for a penalty notice to be issued.

(6A) Where such an application is made, the Appeal Tribunal shall issue a written penalty notice to the central management requiring it to pay a penalty to the Secretary of State in respect of the failure.

(7) Paragraph (6A) shall not apply if the Appeal Tribunal is satisfied, on hearing the representations of the central management, that the failure resulted from a reason beyond the central management's control or that it has some other reasonable excuse for its failure.

(8) Regulation 22 shall apply in respect of a penalty notice issued under this regulation.

(9) No order of the CAC under this regulation shall have the effect of suspending or altering the effect of any act done or of any agreement made by the central management or the local management.

5) Regulation 31 states:

Detriment

31.-(1) An employee to whom paragraph (2) or (5) applies has the right not to be subjected to any detriment by any act, or deliberate failure to act, by his employer, done on a ground specified in, respectively, paragraph (3) or (6).

(2) This paragraph applies to an employee who is-

(a) a member of a special negotiating body,

(b) a member of a European Works Council,

(c) an information and consultation representative, or

(d) a candidate in an election in which any person elected will, on being elected, be such a member or representative.

(3) The ground is that-

(a) the employee performed any functions or activities as such a member, representative or candidate, or

(b) the employee or a person acting on his behalf made a request to exercise an entitlement conferred on the employee by regulation 25 or 26;

or proposed to do so.

(4) The ground in paragraph (3)(a) does not apply where the ground for the subjection to detriment is that in the performance, or purported performance, of the employee's functions or activities he has disclosed any information or document in breach of the duty in regulation 23(1), unless the employee reasonably believed the disclosure to be a "protected disclosure" within the meaning given to that expression by section 43A of the 1996 Act or, as the case may be, Article 67A of the 1996 Order.

(5) This paragraph applies to any employee, whether or not he is an employee to whom paragraph (2) applies.

(6) The grounds are that the employee-

(a) took, or proposed to take, any proceedings before an employment tribunal or industrial tribunal to enforce a right or secure an entitlement conferred on him by these Regulations;

(b) exercised, or proposed to exercise, any entitlement to apply or complain to the Appeal Tribunal, the CAC, or in Northern Ireland the High Court or the Industrial Court, conferred by these Regulations;

(c) requested, or proposed to request, information in accordance with regulation 7;

(d) acted with a view to securing that a special negotiating body, a European Works Council or an information and consultation procedure did or did not come into existence;

(e) indicated that he supported or did not support the coming into existence of a special negotiating body, a European Works Council or an information and consultation procedure;

(f) stood as a candidate in an election in which any person elected would, on being elected, be a member of a special negotiating body or of a European Works Council or an information and consultation representative;

(g) influenced or sought to influence the way in which votes were to be cast by other employees in a ballot arranged under these Regulations;

(h) voted in such a ballot;

(i) expressed doubts, whether to a ballot supervisor or otherwise, as to whether such a ballot had been properly conducted; or

(j) proposed to do, failed to do, or proposed to decline to do, any of the things mentioned in sub-paragraphs (d) to (i).

(7) It is immaterial for the purposes of paragraph (6)(a)-

(a) whether or not the employee has the right; or

(b) whether or not the right has been infringed;

but for that paragraph to apply, the claim to the right and, if applicable, the claim that it has been infringed must be made in good faith.

6) Paragraph 2 of the Subsidiary Requirements set out in the Schedule states:

Composition of the European Works Council

2.-(1) The European Works Council shall be constituted in accordance with sub-paragraph (2).

(2) In each Member State in which employees of a Community-scale undertaking or Community-scale group of undertakings are employed to work, those employees shall elect or appoint one member of the European Works Council for each 10% (or fraction of 10%) which those employees represent of the total number of employees of the Community-scale undertaking or Community-scale group of undertakings employed in those Member States.

(3) The European Works Council shall inform the central management and any more appropriate level of management of the composition of the European Works Council.

(4) To ensure that it can co-ordinate its activities, the European Works Council shall elect from among its members a select committee comprising no more than five members who are to act on behalf of the European Works Council.

7) Paragraphs 3 to 5 of the Subsidiary Requirements set out in the Schedule state:

Appointment or election of UK members of the European Works Council

3.-(1) The UK members of the European Works Council must be UK employees and-

(a) in a case where all of those employees are represented by UK employees' representatives, shall be elected or appointed by such employees' representatives;

(b) in a case where not all of those employees are represented by UK employees' representatives, shall be elected by ballot.

(2) For the purposes of this paragraph all of the UK employees are represented by UK employees' representatives if each of the employees referred to in sub-paragraph (1) is a UK employee-

(a) in respect of which an independent trade union is recognised by his employer for the purpose of collective bargaining; or

(b) who has elected or appointed an employees' representative for the purpose of receiving, on the employee's behalf, information-

(i) which is relevant to the employee's terms and conditions of employment; or

(ii) about the activities of the undertaking which may significantly affect the employee's interests

but excluding representatives who are expected to receive information relevant only to a specific aspect of the terms and conditions or interests of the employee, such as health and safety or collective redundancies.

(3) Where sub-paragraph (l)(a) above applies, the election or appointment of members of the European Works Council shall be carried out by whatever method the UK employees' representatives decide.

(4) Where sub-paragraph (l)(b) applies, the UK members of the European Works Council are to be elected by a ballot of the UK employees in accordance with paragraphs 4 and 5.

Ballot arrangements

4.-(1) The UK management must arrange for the holding of a ballot of employees referred to in paragraph 3(4), which satisfies the requirements specified in sub-paragraph (2).

(2) The requirements referred to in sub-paragraph (1) are that-

(a) the ballot of the UK employees must comprise a single ballot, but may instead, if the UK management so decides, comprise separate ballots of employees in such constituencies as the UK management may determine where-

(i) the number of UK members of the European Works Council to be elected is more than one, and

(ii) the UK management considers that if separate ballots were held for those constituencies, the UK members of the European Works Council to be elected would better reflect the interests of the UK employees as a whole than if a single ballot were held;

(b) a UK employee who is an employee of the Community-scale undertaking or the Community-scale group of undertakings on the day on which votes may be cast in the ballot or, if the votes may be cast on more than one day, on the first day of those days is entitled to vote in a ballot of the UK employees;

(c) any UK employee who is an employee of the Community-scale undertaking or Community-scale group of undertakings immediately before the latest time at which a person may become a candidate in the ballot, is entitled to stand in the ballot of the UK employees as a candidate for election as a UK member of the European Works Council;

(d) the UK management must, in accordance with sub-paragraph (6), appoint an independent ballot supervisor to supervise the conduct of the ballot of the UK employees but may instead, where there are to be separate ballots, appoint more than one independent ballot supervisor in accordance with that sub-paragraph, each of whom is to supervise such of the separate ballots as the UK management may determine, provided that each separate ballot is supervised by a supervisor;

(e) after the UK management has formulated proposals as to the arrangements for the ballot of the UK employees and before it has published the final arrangements under paragraph (f) it must, so far as reasonably practicable, consult with the UK employees' representatives on the proposed arrangements for the ballot of the UK employees;

(f) the UK management must publish the final arrangements for the ballot of the UK employees in such manner as to bring them to the attention of, so far as reasonably practicable, the UK employees and the UK employees' representatives.

(3) Any UK employee or UK employees' representative who believes that the arrangements for the ballot of the UK employees are defective may, within a period of 21 days beginning on the date the UK management published the final arrangements under paragraph (f), present a complaint to the CAC.

(4) Where the CAC finds the complaint well-founded it shall make a declaration to that effect and may make an order requiring the UK management to modify the arrangements it has made for the ballot of the UK employees or to satisfy the requirements in paragraph (e) or (f) of sub-paragraph (2).

(5) An order under sub-paragraph (4) shall specify the modifications to the arrangements which the UK management is required to make and the requirements which it must satisfy.

(6) A person is an independent ballot supervisor for the purposes of sub-paragraph (2)(d) if the UK management reasonably believes that he will carry out any functions conferred on him in relation to the ballot competently and has no reasonable grounds for believing that his independence in relation to the ballot might reasonably be called into question.

(7) For the purposes of sub-paragraph (3), the arrangements for the ballot of the UK employees are defective if-

(a) any of the requirements specified in paragraphs (b) to (f) of sub-paragraph (2) is not satisfied; or

(b) in a case where the ballot is to comprise separate ballots, the constituencies determined by the UK management do not reflect adequately the interests of the UK employees as a whole.

Conduct of ballot

5.-(1) The UK management must-

(a) ensure that a ballot supervisor appointed under paragraph 4(2)(d) carries out his functions under this paragraph and that there is no interference with his carrying out of those functions from the UK management, or the central management (where it is not also the UK management); and

(b) comply with all reasonable requests made by a ballot supervisor for the purposes of, or in connection with, the carrying out of those functions.

(2) A ballot supervisor's appointment shall require that he-

(a) supervises the conduct of the ballot, or the separate ballots he is being appointed to supervise, in accordance with the arrangements for the ballot of the UK employees published by the UK management under paragraph 4(2)(f) or, where appropriate, in accordance with the arrangements as required to be modified by an order made as a result of a complaint presented under paragraph 4(3);

(b) does not conduct the ballot or any of the separate ballots before the UK management has satisfied the requirement specified in paragraph 4(2)(e) and-

(i) where no complaint has been presented under paragraph 4(3), before the expiry of a period of 21 days beginning on the date on which the UK management published its arrangements under paragraph 4(2)(f); or

(ii) where a complaint has been presented under paragraph 4(3), before the complaint has been determined and, where appropriate, the arrangements have been modified as required by an order made as a result of the complaint;

(c) conducts the ballot, or each separate ballot, so as to secure that-

(i) so far as reasonably practicable, those entitled to vote are given the opportunity to vote,

(ii) so far as reasonably practicable, those entitled to stand as candidates are given the opportunity to stand,

(iii) so far as is reasonably practicable, those voting are able to do so in secret, and

(iv) the votes given in the ballot are fairly and accurately counted.

(3) As soon as reasonably practicable after the holding of the ballot, or each separate ballot, the ballot supervisor must publish the results of the ballot in such manner as to make them available to the UK management and, so far as reasonably practicable, the UK employees entitled to vote in the ballot or who stood as candidates in the ballot.

(4) A ballot supervisor shall publish an ineffective ballot report where he considers (whether or not on the basis of representations made to him by another person) that-

(a) any of the requirements referred to in sub-paragraph (2) was not satisfied with the result that the outcome of the ballot would have been different; or

(b) there was interference with the carrying out of his functions or a failure by management to comply with all reasonable requests made by him with the result that he was unable to form a proper judgment as to whether each of the requirements referred to in sub-paragraph (2) was satisfied in relation to the ballot.

(5) Where a ballot supervisor publishes an ineffective ballot report the report must be published within a period of one month commencing on the date on which the ballot supervisor publishes the results of the ballot under sub-paragraph (3).

(6) A ballot supervisor shall publish an ineffective ballot report in such manner as to make it available to the UK management and, so far as reasonably practicable, the UK employees entitled to vote in the ballot or who stood as candidates in the ballot.

(7) Where a ballot supervisor publishes an ineffective ballot report then-

(a) if there has been a single ballot or an ineffective ballot report has been published in respect of every separate ballot, the outcome of the ballot or ballots shall have no effect and the UK management shall again be under the obligation in paragraph 4(1);

(b) if there have been separate ballots and paragraph (a) does not apply-

(i) the UK management shall arrange for the separate ballot or ballots in respect of which an ineffective ballot report was issued to be reheld in accordance with paragraph 4 and this paragraph, and

(ii) no such ballot shall have effect until it has been so reheld and no ineffective ballot report has been published in respect of it.

(8) All costs relating to the holding of a ballot, including payments made to a ballot supervisor for supervising the conduct of the ballot, shall be borne by the central management (whether or not an ineffective ballot report has been made).

Appendix 3 - Article 2 of the SAFRAN EWC Agreement

Set out below are the French and English versions of Article 2. In the case of conflict the French version is to be determinative.

Article 2 - Règles de désignation des membres titulaires:

1.1 Conditions à remplir par les représentants du personnel

Les représentants du personnel dolvent obligatoirement:

- être membres du personnel d'une des sociétés européennes du Groupe

- avoir six mois d'ancienneté dans leur société d'appartenance ou le Groupe et avoir achevé la période d'essal dans les pays où celle-ci est supérleure à six mois.

- et, lorsqu'une représentation du personnel constituée existe, Ils doivent y détenir un mandat électif ou syndical, dans la mesure où la loi locale applicable le prévoit.

1.2 - Modalités de Désignation des membres

1.2.1 - Les membres du Comité d'Entreprise Européen sont désignés conformément à la léglstation applicable dans leur Etat d'appartenance.

1.2.2 - Pour ce qui concerne la délégation française, les sièges sont répartis conformément aux dispositions de l'article L 2344-3 du code du travail, sur la base des résultàts des élections professionnelles aux Comités des Entreprises du Groupe telles que définies au présent accord (cf. annexe 3)

Pour la première mandature, il sera pris en compte les résultats des élections professionnelles, à la date du 31 décembre 2007.

Pour les mandatures suivantes, il sera pris en compte les résultats des élections professionnelles à la date du 31 décembre de l'année précédant l'expiration des mandats.

Les organisations syndicales désigneront leurs représentants parmi les membres titulaires ou sùppléants des Comités d'Entreprise ou Comités d'établissement des sociétés du Groupe ou les représentants syndicaux auprès de ces mêmes instances.

1.2.3 -Pour ce qui concerne les autres délégations Européennes, les candidatures présentées par les organisations syndicales seront, si possible, privilégIées, sous réserve de la loi locale applicable.

1.2.4 -Les parties veilleront à ce que, dans la mesure du possible, la composition du Comité d'Entreprise Européen soit représentative de la répartition Hommes/Femmes au sein des effectifs du Groupe SAFRAN en Europe.

Article 2 - Rules for appointing statutory members:

1.1 - Conditions to be met by staff representatives

Staff representatives must:

- Be members of the personnel of one of the European companies in the Group

- Have six months of seniority in their company of employ or the Group and have completed the probation period in countries where it lasts longer than six months.

- and, when there is a duly constituted employee representative body, staff representatives must hold, an elective or trade-union term of office within said body, if provided for by the currently applicable local legislation.

1.2 - Methods for appointing members

1.2.1 - The members of the European Works Council are appointed in accordance with the legislation applicable within the State to which they belong.

1.2.2 With regard to the French delegation, the seats are distributed in accordance with the provisions of article L 2344-3 of the French labor code, on the basis of the results of labor elections to the Works Councils in the Group as defined in the present agreement (cf. appendix 3).

For the first term of office, the results of labor elections as at December 31, 2007 will be taken into account.

For following terms of office, the results of labor elections as at December 31 of the year preceding the date of expiry of the terms of office will be taken into account.

Trade-union organizations will appoint their representatives from among the statutory or substitute members of the Works Councils or Plant Councils of companies in the Group or from among the trade- union representatives to these same authorities.

1.2.3 - With regard to the other European delegations, the applicants presented by the trade-union organizations will be given priority, where possible, subject to compliance with the applicable local legislation.

1.2.4 - The parties hereto will ensure that the composition of the European Works Council is representative of the distribution of male and female employees within the headcount of the SAFRAN Group in Europe, as far as possible.


         

[1] Two UK representatives were to be elected and two substitutes.

[2] The French and English translation of Article 2 is set out in full in Appendix 3.

[3] SNG being the French equivalent of the UK Special Negotiating Body.

[4] The English translation reads: The members of the European Works Council are appointed in accordance with the legislation applicable within the State to which they belong. (See Appendix 3)

[5] The English translation reads: With regard to the other European delegations, the applicants presented by the trade-union organizations will be given priority, where possible, subject to compliance with the applicable local legislation. (See Appendix 3)