Smith v Kent County Council

A collective agreement may be incorporated into an individual contract of employment by clear contractual reference, even though the agreement is not itself directly enforceable. A term governing salary deductions for absence is not inconsistent with a statutory scheme merely because that scheme prescribes remuneration and working-time conditions. Statutory terms may form the core of the employment relationship while contractual terms regulate matters on which the statutory scheme is silent. A contractual term fixing the deduction for strike absence at 1/365th of annual salary therefore governs.

The claimant was employed as a full-time teacher by the defendant local authority. Her contract referred to the Conditions of Service for Schoolteachers in England and Wales, commonly known as the Burgundy Book. After she took part in a one-day strike, the defendant deducted 1/195th of her annual salary.

The claimant sought a declaration that the deduction should be calculated at 1/365th. The issues were whether clause 3.2 of the Burgundy Book had been incorporated, whether it conflicted with the School Teachers’ Pay and Conditions Document 2001, and whether any incompatibility would cause the contractual term to give way.

1. Incorporation. The contractual reference to the Burgundy Book was clear and precise. The listed subjects highlighted areas of particular relevance and did not exclude clause 3.2. In the absence of clear exclusionary words, clause 3.2 was incorporated into the claimant’s contract. The principle that a collective agreement may be incorporated was supported by Marley v Forward Trust Group Ltd [1996] ICR 891.
2. Strike action. The claimant’s strike constituted a breach of the contractual obligation to be available for work on the specified working days. The authorities recognised that an employer may withhold remuneration referable to work which the employee has declined to perform, without terminating the contract or relying on damages. The court considered Sim v Rotherham Metropolitan Borough Council [1986] ICR 897 and applied the principle stated in Miles v Wakefield Metropolitan District Council [1987] ICR 368.
3. Statutory scheme. The School Teachers Pay and Conditions Act 1991 and the 2001 Order prescribe statutory conditions concerning remuneration, professional duties and working time. The statutory scheme does not regulate every incident of remuneration, including the calculation of deductions for absence. Clause 3.2 supplemented, rather than conflicted with, the statutory scheme.
4. Disposition. The claimant was entitled to a declaration that the maximum lawful deduction for her absence was 1/365th of her annual salary at the relevant date.