Gilgrove Ltd v Hay

The construction of a collective agreement is a question of law once its terms have been identified. It is construed like any other contractual document, in its factual context and by reference to the parties’ objective intentions. Where a porterage scheme rewards work performed by porters, the word porter is not confined to a person registered under the agreement unless the agreement makes that qualification material. Entitlement therefore follows the performance of the portering duties, rather than registration or trade union membership.

Employees working at New Covent Garden Market claimed that their employers had made unlawful deductions from wages under Part II of the Employment Rights Act 1996. Their contracts incorporated a collective agreement under which porterage was to be shared equally between the foreman, porters and temporary porters employed on the stand.

The Employment Judge held that only registered porters were entitled to share the porterage and awarded compensation. The employers appealed, contending that the agreement entitled every person performing portering work to participate. The central issue was whether “porter” in the 1974 agreement meant only “registered porter”.

1. The appeal was allowed, the Employment Judge’s judgment was set aside, and the claims were dismissed. The issue could properly be decided by the EAT without remission because it was a question of construction and the material findings were sufficient.

2. Per His Honour Judge McMullen QC, construction of a collective agreement is no different from construction of any other contractual document. The court must identify the terms and then determine their meaning as a question of law. The agreement is construed objectively and in its factual setting, but subsequent events cannot add new terms or rectify the agreement where the issue is the meaning of words already used.

3. The relevant agreement used the word “porter”, not “registered porter”. Its purpose was to reward the work of loading and handling produce through a system of payment by results. The division of porterage depended on who performed the work: an absent worker received nothing for that day, while a temporary porter who performed the work was entitled to share.

4. Registration and trade union membership were therefore irrelevant to the construction of clause 5. A person who performed the duties of a porter was entitled to an equal share of the porterage, whether registered or unregistered. The claims for deductions based on sharing the pool with an unregistered porter consequently failed.

• Employment Appeal Tribunal: disagreed with the Employment Judge’s construction, set aside the judgment and dismissed the claims.
• Employment Tribunal, London South: Employment Judge Tsamados held that the porterage scheme applied only to registered porters and awarded compensation. The judgment was sent to the parties on 12 July 2011.