60.     In general the Bill is not concerned with voluntary recognition, other than to try to promote voluntary agreement in preference to imposed solutions. However, there is an exception where an employer seeks to avoid statutory recognition by agreeing to recognise a union voluntarily but then failing to honour the terms of the recognition agreement. This Part of the Schedule therefore sets out a process by which a union or employer who believes that the other party is failing to honour a voluntary recognition agreement can ask the CAC to determine the method by which collective bargaining should take place.

61.     Paragraph 33 defines the scope of this Part and paragraphs 34, 35 and 36 make provision as to definitions. Under paragraph 35, a union may in certain circumstances make an application to the CAC to specify a method of bargaining. Sub-paragraph (2) makes provision for exemptions for employers with fewer than 21 workers. Paragraph 36 provides for the form of applications in similar terms to those in respect of recognition applications under Part I.

62.     Paragraph 37 provides that, if an application is made under paragraph 35 and either the employer and union have not agreed a method for collective bargaining or a collective bargaining agreement has not been followed, the CAC must try to help them agree the method to be used. If no agreement is reached, the CAC must specify the method for collective bargaining unless the parties jointly request otherwise. This is the same procedure as that under paragraph 22 in respect of collective bargaining following an award of recognition under the statutory procedure, and as with the paragraph 22 procedure the Secretary of State may specify a model collective bargaining method under paragraph 86.

Part III: Derecognition: General

63.     Chapter 4 of Fairness at Work set out that procedures for derecognition would be similar to those for recognition, and invited views on how this should work. The statutory derecognition process set out in Part III applies only where a declaration of recognition has been made under Part I or where a union has had a collective bargaining method specified by the CAC under Part I or II. Applications for derecognition may only be accepted three or more years after the CAC's original decision. Save in these circumstances, Part III does not apply, but if a voluntarily-recognised union is derecognised, it may then apply for recognition under Part I.

64.     Paragraphs 38 and 39 provide that the derecognition procedure applies to unions recognised as the result of a CAC declaration which have in place a method for collective bargaining, whether voluntarily agreed, imposed by the CAC or agreed as a variation on a CAC settlement.

65.     Paragraph 40 provides that the derecognition procedure also applies to voluntarily-recognised unions where a method for collective bargaining was specified by the CAC. If the employer and the union agreed in writing under paragraph 37(6) to replace a CAC-imposed method for collective bargaining, or that the CAC method should not be legally binding, then the derecognition procedure does not apply. The intention is to prevent voluntary recognition being used as a means of evading the formal recognition procedure, by refusing to agree or to put into practice a voluntary collective bargaining agreement.

66.     In line with the Government's proposals in Fairness at Work, paragraph 41 provides that derecognition may not take place until three or more years after a CAC declaration was made (if paragraph 38 or 39 applies) or a voluntary agreement on recognition was reached (in the cases covered by paragraph 40). This was the interval proposed in Fairness at Work.

67.     The statutory recognition and bargaining method procedures in Parts I and II do not apply to an employer with fewer than 21 employees. If, at least three years after a CAC decision, an employer has fewer than 21 workers, it can notify the union that it will therefore be derecognised. The union may appeal to the CAC if it believes the request is unfounded.

68.     Paragraph 43 provides that if the employer employs an average of fewer than 21 workers (excluding employees of associated employers incorporated outside the UK) over a period of thirteen weeks, he may at the end of that period give notice to the union of the fact and state that the existing bargaining arrangements will not apply from a given date, which shall be at least 25 working days after the union is notified. The collective bargaining arrangements will cease to have effect on the date specified in the notice unless the union makes an application to the CAC under paragraph 44.

69.     Paragraph 44 provides for the union to make an application to the CAC to determine whether an employer's notice under paragraph 43 is valid and/or whether the employer has fewer than 21 workers. The CAC has 10 working days from the date it receives an application in which to reach a decision. If it finds that the employer has 21 or more workers or that the employer's notification was not valid, the collective bargaining arrangements will remain in place; otherwise, the notice will take effect and the collective bargaining arrangements will end on the date specified in the notice.

70.     Paragraphs 45-50 apply if the employer requests the union to end the bargaining arrangements. (These paragraphs are broadly similar to paragraphs 8-10 and 13, which deal with a request for recognition.) If the union was recognised voluntarily, and the CAC did not impose a method for collective bargaining (paragraph 40), then this procedure does not apply and the employer may derecognise at any time without going through the statutory procedure in this Part.

71.     In order to promote stability in bargaining arrangements, paragraph 45 has the effect that a request to end the bargaining arrangements may be made under this Part only once three or more years has passed since the CAC's ruling.

72.     Paragraph 46 provides that the derecognition procedure is to end if the parties agree to end the bargaining arrangements within ten working days of the request. If the union agrees to negotiate, then the parties have at least 28 days in addition to the initial ten working day period to reach agreement. They can extend the period for negotiation by mutual consent. If the parties agree that the union should remain recognised, it is sufficient for them to take no further action. The CAC would not be asked to make a decision under paragraphs 47 or 48, and the bargaining arrangements would remain in force. Sub-paragraph (5) is for the avoidance of doubt; there is no requirement to involve ACAS.

73.     Paragraph 47 provides that if the union either does not respond to or rejects the request before the end of the first (ten working day) period, the employer may apply to the CAC to hold a secret ballot to decide whether a majority of workers support derecognition.

74.     Paragraph 48 provides that if the employer and union fail to reach agreement in the second (28 day) period, the employer may apply to the CAC to hold a secret ballot to decide whether a majority of workers support the ending of the collective bargaining arrangements. Paragraph 49 contains general procedural requirements for applications to the CAC.

75.     Paragraph 50 provides that, if the CAC is to decide whether a union should be derecognised, it must first be satisfied that derecognition is likely to have sufficient support in the bargaining unit to make proceeding with the application worthwhile. The test for this is that at least 10% of the bargaining unit favour an end to the collective bargaining arrangements and a majority of the workers in the bargaining unit would be likely to do so. This is essentially the same test as in paragraph 26 for recognition applications.

76.     These provisions apply equally if one or many workers in the bargaining unit formally request an end to collective bargaining arrangements. For simplicity these notes on paragraphs 51-52 refer to applications by a single worker but such references should be read as covering a worker or workers.

77.     Paragraph 51 provides that three or more years after a CAC ruling, a worker may apply to the CAC to end the collective bargaining arrangements. Paragraph 52 provides that the CAC may not proceed with an application unless at least 10% of the bargaining unit favour an end to the collective bargaining arrangements and a majority of the bargaining unit are likely to do so. (This is essentially the same test as in paragraph 50).

78.     Paragraph 52(4) requires the CAC to help the employer, union and worker with a view either to the employer's and union's agreeing to end the bargaining arrangements or the worker's withdrawing the application in the 28 days after the application is accepted. If an agreement is reached or the application is withdrawn, the CAC will take no further action. Otherwise, it must hold a ballot under the provisions of paragraphs 53-57.

79.     Paragraphs 53-57 make provision for the holding of ballots on applications for derecognition, mirroring the procedures for recognition ballots under paragraphs 16-20. Paragraph 57 provides that if the ending of bargaining arrangements is supported by a majority of those who vote and at least 40% of the workers constituting the bargaining unit, the CAC must declare that the bargaining arrangements will cease to have effect from a specified date; otherwise, the application must be refused and the union will remain recognised. The conditions for derecognition may be altered by the Secretary of State by order subject to affirmative resolution procedure.

Part IV: Derecognition where recognition automatic

80.     Part IV provides for a different derecognition process to apply in cases where unions have been 'automatically' recognised on the grounds of having greater than 50% membership of the bargaining unit (ie without a ballot). Applications for derecognition of an automatically-recognised union may only be accepted three or more years after recognition.

81.     Paragraphs 58 and 59 provide that the derecognition procedure applies to unions recognised as the result of a CAC declaration under paragraph 14 where a method for collective bargaining is in place, whether voluntarily agreed, imposed by the CAC or agreed as a variation on a CAC settlement.

82.     Paragraph 60 provides that derecognition may not take place until three or more years after a CAC declaration of recognition was made. This was the interval proposed in Fairness at Work and used in Part III of the Schedule.

83.     Paragraphs 62-65 apply if the employer requests the union to end the bargaining arrangements on the grounds that fewer than half of the workers constituting the bargaining unit are members of the union. (These paragraphs are similar to paragraphs 45-50, which deal with a standard request for derecognition.)

84.     In order to promote stability in bargaining arrangements, paragraph 62 has the effect that a request to end the bargaining arrangements may be made under this Part only once three or more years has passed since the CAC's ruling.

85.     Paragraph 63 provides that the derecognition procedure is to end if the parties agree to end the bargaining arrangements within ten working days of the request. If the union agrees to negotiate, then the parties can extend the ten working day negotiation period by mutual consent. If the parties agree that the union should remain recognised, it is sufficient for them to take no further action. The CAC would not be asked to hold a ballot under paragraph 66, and the bargaining arrangements would remain in force. If the union either does not respond to or rejects the request before the end of the negotiation period, the employer may apply to the CAC to hold a secret ballot to decide whether the union should be derecognised.

86.     Paragraph 64 contains general procedural requirements for applications to the CAC under this Part.

87.     Paragraph 65 provides that, if the CAC is to hold a ballot to decide whether a union should be derecognised, it must first be satisfied that a majority of the workers who make up the bargaining unit are not members of the recognised union. If a majority of the workers are union members, the automatic recognition remains in force and the CAC must take no further action. The CAC has 10 working days in which to decide.

88.     Paragraph 66 provides that if a ballot is to be held on derecognition the same derecognition ballot procedure as in Part III should be followed.

Part V: Derecognition where union not independent

89.     Part V provides that workers will be able to apply to the CAC for the derecognition of a union which does not have a certificate of independence and which has been voluntarily recognised by an employer. This is the sole exception to the principle that, if the CAC did not declare recognition or prescribe a collective bargaining procedure, the statutory derecognition procedure does not apply.

90.     These provisions apply equally if one or many workers in the bargaining unit formally request an end to collective bargaining arrangements. For simplicity these notes on paragraphs 67-73 refer to applications by a single worker but such references should be read as covering a worker or workers.

91.     Paragraph 67 restricts the scope of this Part to unions which do not have a certificate of independence.

92.     Paragraph 71 provides that three or more years after a non-independent union is recognised, a worker may apply to the CAC to end the collective bargaining arrangements. Paragraph 72 provides that the CAC may not proceed with an application unless at least 10% of the bargaining unit favour an end to the collective bargaining arrangements and a majority of the bargaining unit are likely to do so. (This is essentially the same test as in paragraph 50). Paragraphs 68, 69 and 70 provide definitions for this Part of the Schedule.

93.     Paragraph 72(4) mirrors paragraph 52(4), which requires the CAC to help the employer, union and worker negotiate, with the aim that either they agree to end the bargaining arrangements or the worker withdraws the application. If an agreement is reached or the application is withdrawn, the CAC will take no further action. Otherwise, it must hold a ballot under paragraphs 53-57.

Part VI: Detriment

94.     Detriment is action short of dismissal taken by an employer which is damaging to the worker. Paragraphs 74-78 set out provisions prohibiting such detriment in respect of a worker on the grounds relating to recognition or derecognition of a union listed in paragraph 74(2). Under section 146 of the 1992 Act, an employee currently has the right not to suffer detriment on grounds of membership, non-membership or taking part in the activities of a trade union. The Bill extends this right so as to prohibit detriment in respect of the paragraph 74(2) grounds and gives employees the right to complain in respect of such detriment to an employment tribunal. Paragraphs 75-78 make provision for time limits and other procedural matters and in relation to the calculation of awards.

95.     Paragraph 79 provides that an employee's dismissal is unfair if it is on the grounds related to recognition or derecognition and listed in paragraph 79(2). Paragraph 80 makes similar provision in respect of selection for redundancy. Paragraph 81 provides that dismissal which would be unfair under paragraphs 79 or 80 will still be unfair even if the employee has waived rights to unfair dismissal under a fixed-term contract under section 197(1) of the 1996 Act. This provision is transitional in nature since such waivers are prohibited by clause 17.

96.     Paragraph 82 provides that dismissal as a result of an employee acting or failing to act for or against recognition or derecognition of a union is unfair even if the employee has not completed the qualifying period for unfair dismissal or has passed the normal upper age limit for dismissal protection.

* The qualifying period for unfair dismissal is currently two years, as set out in section 108 of the 1996 Act. The Government intends to reduce this period to one year by order under section 209 of that Act.

* The upper age limit is dealt with in section 109 of the 1996 Act.

Part VII: General

97.     Paragraph 86 provides that the Secretary of State may provide guidance to the CAC on the method for collective bargaining it should impose under paragraphs 22(3) and 37(4). The Secretary of State must consult ACAS before providing the guidance, which will be made by order subject to negative resolution procedure. The CAC must take into account any such guidance in imposing a bargaining method, but may depart from it as circumstances require.

Clause 2 and Schedule 2: Detriment related to trade union membership

98.     The law currently prohibits discrimination by positive act taken on grounds of trade union membership, non-membership or activities but not by omission on the same grounds. In other words, if an employer takes action which gives a benefit to non union members but omits to confer the same benefit to union members, the omission does not constitute action short of dismissal on grounds related to trade union membership under section 146 of the 1992 Act. This aspect of the law was brought to light in the cases Associated Newspapers v Wilson and Associated British Ports v Palmer [HL 1995] ICR 406, where the House of Lords held that the word "action" in section 146 did not extend to omissions to act.

99.     Clause 2 gives effect to Schedule 2, which amends section 146 so as to prohibit this form of discrimination by omission and makes consequential amendments to other related sections of the 1992 Act: section 147 on the time limit for applications to be made to employment tribunals; section 148 on the consideration of a complaint by tribunals; section 149 on the remedies which tribunals can award; and section 150 on awards against third parties.

100.     Paragraph 2 of Schedule 2 replaces references in sections 146(1), (3) and (4) of the 1992 Act to action short of dismissal on grounds related to trade union membership, non-membership or activities with references to a right not to be subjected to any detriment as an individual by an act or deliberate failure to act on the part of the employer for one of the prohibited purposes. Section 146(5), which sets out the ground on which an employee may present a complaint to an employment tribunal as action taken against him, is amended accordingly. Similarly, paragraphs 3 to 6 make consequential amendments to sections 147, 148, 149 and 150 of the 1992 Act, which deal respectively with the time limits for bringing complaints before an employment tribunal, the criteria to be applied by the tribunal in determining the purpose of an employer's action, the remedies available in the event that the tribunal find a complaint is well-founded and proceedings against third parties.

Clause 3 : Blacklists

101.     Under sections 137 and 138 of the 1992 Act, refusal of employment (or in the case of employment agencies refusal of service) on grounds of trade union membership is unlawful. There have in the past been instances of companies which compiled and distributed information for sale or distribution to employers to encourage discrimination against workers. Such information included lists of supposed trade union activists. Individuals whose names were on such lists could have difficulty finding work. Inclusion could be defamatory and unjustified but it was often impossible in practice to obtain a remedy. There is no evidence that blacklisting is widespread but the practice of blacklisting in the UK has been repeatedly criticised by the International Labour Organisation. In Fairness at Work, the Government proposed to prohibit the blacklisting of trade union members.

102.     The purpose of clause 3 is to give the Secretary of State the power to make regulations, subject to affirmative resolution (under clause 33), to prohibit the compilation and use of lists which contain information about individuals' trade union membership or activities with a view to their being used by employers or employment agencies for purposes of recruitment. The Government intends to consult on draft regulations before they are made.

Clause 4: Notice relating to industrial action

103.     If a trade union decides to call on its members to take or continue industrial action, it has no immunity from legal liability unless it holds a properly conducted secret ballot in advance of the proposed action. Unions are required by sections 226A and 234A of the 1992 Act to give to the employers concerned advance notice in writing both of the ballot and of any official industrial action which may result. The ballot notice must describe, so that their employer can readily ascertain them, the employees who it is reasonable for the union to believe will be entitled to vote. Likewise, the notice of official industrial action must describe, so that their employer can readily ascertain them, the employees the union intends should take part in the action. The current law has been interpreted by the courts (most notably, in the case Blackpool and the Fylde College v National Association of Teachers in Further and Higher Education [1994] ICR, 648 Court of Appeal and 982 House of Lords) as requiring the union in certain circumstances to give to the employer the names of those employees which it is balloting or calling upon to take industrial action. The purpose of the clause is to amend the 1992 Act so as to ensure that unions are never required by the law to disclose the names of their members to employers in these circumstances.

104.     Subsections (2) and (3) amend the provisions of the 1992 Act which deal with the notice to be issued in advance of the ballot. Subsection (2) amends section 226A(2) to redefine the purpose for which the notice is required as being to enable the employer to make plans to deal with the consequences of any industrial action and to provide information to those employees who are being balloted. Subsection (3) inserts a new section 226A(3A) which sets out the type of information which is to be included in the notice in order to satisfy the new section 226A(2). It has the effect that a union is required to provide only information which is in its possession and that it is not required to name the employees concerned.

105.     Subsections (4) and (5) amend section 234A of the 1992 Act, which provides for a notice to be issued in advance of official industrial action, in similar terms.

Clause 5: Ballots for industrial action: period of effectiveness

106.     Section 233 of the 1992 Act provides that industrial action does not have the support of a ballot unless it is called by a "specified person" and meets certain other conditions. One of these conditions is that action to which the call relates must take place before the ballot ceases to be effective in accordance with section 234 of the 1992 Act. Section 234(1) provides that, in ordinary cases, ballots cease to be effective at the end of the period of four weeks beginning with the date of the ballot. Section 246 of the 1992 Act provides that the "date of ballot" is, where votes are cast on more than one day, the last of those days.

107.     Clause 5 provides for this period to be lengthened by up to a maximum of four more weeks, if both the union and the employer agree to an extension. The purpose of the provision is to avoid circumstances where a union feels obliged to organise industrial action within the four week period before a ballot becomes ineffective, even though the parties consider a settlement might be achieved by further negotiation.

108.     Where the ballot has included the workers of two or more employers, the option of agreeing an extension is to operate separately in relation to each employer. So, if a ballot involved the workers of two employers (employer A and employer B) and employer A agreed an extension but employer B did not, the extension would apply only in respect of A's workers and not B's.

109.     Subsections (2) to (6) of section 234, which deal with the particular case where a court has lifted an injunction prohibiting a union from calling industrial action, are unaffected.

Clause 6: Training

110.     Clause 6 inserts new sections 70B and 70C into Chapter VA of Part I of the 1992 Act. (NB Chapter VA is itself inserted into the 1992 Act by clause 1 of the Bill.) Under new section 70B, if a union is recognised under the procedure set out in Part I of Schedule A1 to the 1992 Act as inserted by Schedule 1 to this Bill and the CAC has specified a method for collective bargaining under paragraph 22 of Schedule A1 which the employer and union have not agreed should not be legally binding under sub-paragraph 22(5) of the Schedule, the employer must invite representatives of the union to:

• consult on the employer's policy on training;

• consult on the employer's plans for training in the next six months or, if the employer sets a date for the next meeting, in the period before the next meeting, and

• report on the training undertaken since the previous meeting.

111.     This duty applies only in respect of workers within the bargaining unit. The first such meeting must be held within six months of the CAC imposing a method for collective bargaining, and further meetings must be held within six months of the previous meetings. The employer will be obliged to give to the union any information without which it would be impeded in participating in the meeting and which it is in line with good industrial relations practice to provide. This is subject to certain exceptions (for example, information which would disclose the identity of individuals without their consent). The information must be provided at least two weeks before the meeting. After the meeting, the union has four weeks in which to make written representations (comments, suggestions or requests) on the training matters discussed at the meeting, which the employer must take into account.

112.     New section 70C provides that a union may complain to an employment tribunal that an employer has failed to fulfil the obligations under new section 70B. This failure could for example consist of a failure to hold meetings or to provide insufficient information to the union in advance of a meeting. As is usual for employment tribunals, a complaint should be made within three months of the alleged failure. If the tribunal upholds the complaint, it may award compensation to each member of the bargaining unit, to a maximum of two weeks' pay. This award is payable to the individual workers, and the union may not take legal action to enforce payment: a worker may take such legal action if necessary.