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Employment Relations Bill

8.40 p.m.

House again in Committee on Schedule 1.

[Amendment No. 54 not moved.]

Lord Wedderburn of Charlton moved Amendment No. 55:

Page 26, line 26, at end insert--
("(7A) No interlocutory proceedings shall be entertained by any court where the only remedy available is specific performance under sub-paragraph (6).")

The noble Lord said: The amendment relates to the terms of the remedies available for the breach of a binding collective agreement as specified by the CAC.

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In view of our recent debates, it is necessary that I should read out Schedule 1, paragraph 27. Sub-paragraph (3) states:

    "If at the end of the agreement period the parties have not made such an agreement the CAC must specify to the parties the method by which they are to conduct collective bargaining". Sub-paragraph (4) states:

    "Any method specified under sub-paragraph (3) is to have effect as if it were contained in a legally enforceable contract made by the parties". Sub-paragraph (5) is not relevant. Sub-paragraph (6) states:

    "Specific performance shall be the only remedy available for breach of anything which is a legally enforceable contract by virtue of this paragraph". Members of the Committee will note that the remedy is limited to the breach of anything which is a legal enforceable contract under this paragraph. That includes all the forms of CAC declaration and the like.

The amendment seeks to exclude a form of procedure in the High Court which is interlocutory in its nature; that is to say, theoretically it is interim. However, the Scots courts use the word "interim" rather more sensibly than the English courts, but always refuse to accept that the two are the same. Therefore, I shall use the English term "interlocutory injunction." It is a case where the claimant comes to the court and says, "You are about to commit a wrong [a breach of collective agreement that is binding] and I want the remedy available to me, which at the moment is an interlocutory injunction."

Therefore, first, the procedure is an Alice in Wonderland procedure. It speaks as though the orders requested are effective until the full trial or order. In fact, the interlocutory order is usually what the plaintiff wants; he wants to stop the other side from doing what he complains about.

In order to establish that an interlocutory proceeding could come into play with the High Court, which is all I seek to do, I shall state in not academically correct order the nine most important reasons why the interlocutory injunction is an undesirable procedure. The noble Baroness need not look afraid; each point will be dealt with in a short sentence. First, the applicant--normally the employer--ought to give notice of some two days, but usually and frequently gives less. In one notorious application for an injunction, the judge was contacted on a Sunday and the order was made against the union without any notice.

Secondly, the cases are regularly heard not only with little or no notice but also ex parte; that is, without the defence being heard at all. Thirdly, the judge may grant an injunction if the plaintiff proves that he has a serious case to be tried. The plaintiff does not have to prove that he has a bona fide case, as he used to under previous case law. Fourthly, the judge has a discretion to decide whether damages are adequate and whether the balance of convenience favours the applicant. What the balance of convenience is is a highly subjective matter.

Fifthly, the employer has his damage assessed on the assumption that it will be as he says it will be and on that basis the court decides whether an order will be made. Sixthly, injunction to a trial or further order is the

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nature of the interlocutory proceedings, but invariably the employer, under present case law, has little intent of taking the case on to full trial. Seventhly, the court should and must grant an injunction if the alleged damage is about to hit the employer, or third parties, or the interests of the public. A number of cases have recently increased the importance of that last phrase, such that the public interest is to the fore. One Lord Justice of Appeal in the dock strike case in 1989 said that there could be a "complete stoppage" in all the scheme ports under the action. There would then be a major impact on innocent third parties and the economic well-being of the nation.

Eighthly, the normal rule is that the court must not grant an interim declaration of rights. A declaration of rights should be a final declaration. However, in interlocutory cases within the past decade or more such declarations have been made and they normally give rise to the defendant not pursuing the action.

Ninthly, the judge should consider the desirability of a return to the status quo. When Mr. Justice Millett, as he then was, did that in the dock strike case, putting the position back to where the strike began, the Court of Appeal immediately struck him down and said that the status quo means where it was when the ports were under normal working. In other words, status quo means before the industrial dispute began.

I accept that as the present case law stands, those points are relevant to interlocutory injunctions. I say to the Government that if they would like to write them all out and insert an order for specific performance in a number of the cases where interlocutory injunction occurs they will see why it must be possible for specific governments to come as part of a dispute between the two parties, which is extremely undesirable.

The reason that it must be so is found in sub-paragraphs (4) and (6) of paragraph 27. The paragraph is about parties in dispute, even though its language is parties in agreement, because the agreement between two parties is always tested by what happens when they come into dispute. If it were not the case that such orders of specific performance could not affect the parties, there would be no reason to have paragraph 27 (6) at all.

Before the dinner break, my noble friend said that it would be impossible for a specific performance order to intervene and affect industrial action. However, I must add that the threat of industrial action--

Lord McIntosh of Haringey: The word I used was "restrain".

Lord Wedderburn of Charlton: I am happy with that. We could spend some time with a dictionary, but I shall accept what my noble friend says. However, it is interesting that he prefers "restrain" to "intervene". This paragraph makes no sense unless it includes a remedy for parties who are in dispute and in respect of which one of them has allegedly acted in breach of the imposed contractually binding procedure. If it does not mean that, I do not know what it means. If it does mean that, to put it at its lowest, the Government should decide

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whether they want interlocutory proceedings to be brought. Do they want to allow for interlocutory proceedings in respect of breaches of paragraph 27? I say that they should not. I say that it would be very silly. If the question were put in a straightforward way, I believe that most employers and unions would want to exclude the possibility of interlocutory proceedings, as they know perfectly well that they give rise to enormous legalism in proceedings, which is undesirable; and in many cases they give rise to enormous legal costs because matters are taken to appeal.

Are the Government happy that the refusal of a specific performance order could allow for an appeal to the Court of Appeal and then to your Lordships' Judicial Committee on the basis that the parties have disagreed?

Parties who agree do not need the schedule. They may just need it in the vocabulary of the bargain. Parties who disagree will look to the schedule, first, as to whether the CAC will impose an agreement, and, secondly, for remedies under paragraph 27. Very often, perhaps always, the remedy is characteristic of the rights. If the Government are saying that no employer will ever receive a specific performance order that will restrain, in part, action by the union--whether or not industrial action--it will give rise to an enormous new proposition on which we should have a debate on Report. I beg to move.

Lord McIntosh of Haringey: I have listened carefully to my noble friend's argument. I recognise that it is in line with the arguments that he has used on previous amendments. I shall deal with the amendment but, after that, I believe that it is best if we deal with these matters off line. Perhaps my lawyers should talk to him and to any other lawyers whom he wishes to bring to court with him. It is difficult to envisage circumstances in which a court would entertain an application for an interlocutory order to compel compliance with an imposed procedure agreement. I do not think a court would make an order simply because one party feared the other might not comply in due course. The fear would have to be well-founded. I suppose it is conceivable--I shall use an example which works in the other direction from that which my noble friend has used--if an employer, for example, had announced publicly that he had no intention of complying with the procedure imposed by the CAC, then a union might be able to obtain an interlocutory order compelling compliance with the procedure. Presumably, that could work in both directions. However, I have to say that that sounds somewhat far-fetched.

I have listened carefully to the nine reasons given by my noble friend. It still seems to me that it is unlikely that the procedure would give rise to interlocutory proceedings but equally I am not convinced that we should rule out such proceedings if, for example, circumstances, such as those I have just outlined, were to arise.

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However, clearly, we have to talk about this. If my noble friend is willing to do so, I would ask him to withdraw the amendment so that we can do that before Report stage.

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