Hay & Ors v Gilgrove Ltd & Anor

This appeal concerned the construction of a term of a 1974 collective agreement incorporated into the claimants' contracts and whether references to "porter" and to "porterage" were limited to registered porters. The Employment Tribunal had held that only registered porters were entitled to share the porterage and found unlawful deductions contrary to section 13 of the Employment Rights Act 1996. The Employment Appeal Tribunal allowed the employers' appeal, concluding that in the changed circumstances the agreement should be read to entitle those actually performing porter work to share porterage, whether registered or not.

The Court of Appeal dismissed the claimants' appeal, endorsing the Employment Appeal Tribunal's view that the word "porter" in the agreement was used descriptively to identify who performed the work at the time the agreement was made and was not intended to operate as a qualifying condition preventing non-registered porters from sharing porterage once such persons lawfully worked at the market. The court treated the issue as a question of contractual construction, not a matter of factual finding.

The claimants were porters at New Covent Garden Market. Their claims alleged unlawful deductions from wages under section 13 of the Employment Rights Act 1996 arising from the employers' practice of paying registered porters a basic wage plus a share of porterage while unregistered porters received a higher fixed weekly wage with no separate porterage payment.

Background and parties:

• The appellants were registered porters employed by two respondents. The 1974 collective agreement between the tenants' association and the union contained provisions about registration and a clause providing for porterage to be pooled and shared among porters. Clause 5 and other provisions in Part II were material.
• Following termination of the collective agreement and the subsequent employment of unregistered porters, the claimants contended that porterage earned by efforts of all porters should be shared exclusively among registered porters.

Procedural history:

• The Employment Tribunal (Employment Judge Tsamados) upheld the claimants' claims and directed remedies hearings, awarding sums in the order of £6,900 to each claimant at Gilgrove and about £15,000 to each claimant at C&C.
• The Employment Appeal Tribunal (His Honour Judge McMullen QC, UKEAT/0571/11/SM) allowed the employers' appeal, holding that the agreement should be construed to entitle those actually performing porter duties to share porterage and that registration was descriptive rather than a qualifying condition.
• The claimants appealed to the Court of Appeal. The Court of Appeal heard argument and dismissed the appeal, agreeing with the Employment Appeal Tribunal's approach.

Issues framed by the court:

• Whether the term "porter" in the 1974 agreement meant only a "registered porter" and therefore whether only registered porters were entitled to share porterage;
• Whether the Employment Appeal Tribunal was wrong to reverse the Employment Tribunal's decision based on findings of fact.

Reasoning:

• The Court of Appeal treated the construction of the collective agreement as a question of law. The court held that the 1974 agreement was directed to the situation existing at its inception when only registered porters existed, but it would be absurd to interpret it as preventing future, lawfully employed unregistered porters from sharing porterage earned by their work. The reference to registration was therefore descriptive and not a qualification for entitlement to porterage in changed circumstances.
• The court also explained that if the Employment Tribunal's narrower interpretation were correct, a further logical consequence would follow that registered porters would be entitled only to porterage attributable to their own work and none of the porterage attributable to unregistered porters, an outcome neither side advocated. The Employment Appeal Tribunal's construction was therefore preferred and the Employment Tribunal had misdirected itself on the construction issue.

The appeal was dismissed. The Court of Appeal agreed with the Employment Appeal Tribunal that the 1974 collective agreement should be construed so that entitlement to share porterage follows the performance of porter work and is not confined, as a qualifying condition, to those who happened to be "registered" when the agreement was made. The question was one of contractual construction rather than a contested factual finding, and the Employment Tribunal had erred in its approach.

Employment Tribunal (London South) judgment sent with reasons on 12 July 2011 (Employment Judge Tsamados) — claimants' claims upheld. Employment Appeal Tribunal allowed employers' appeal (His Honour Judge McMullen QC), order dated 10 April 2012, UKEAT/0571/11/SM. Appeal to the Court of Appeal heard 24 January 2013; judgment handed down 26 April 2013 ([2013] EWCA Civ 412).