Advisory Conciliation and Arbitration Service v Public and Commercial Services Union

For the purposes of Regulation 2 of the Information and Consultation of Employees Regulations 2004, economic activity may include the provision of goods or services funded by a source other than the consumer, and may be carried on by a monopoly. A public body’s statutory status and non-profit character do not by themselves exclude economic activity. The exclusion for activities involving the exercise of public powers requires a case-by-case assessment of the activities themselves. It is sufficient that the relevant legal entity carries out an economic activity which is more than ancillary or de minimis. A body may therefore fall within the Regulations because a substantial part of its activities is economic, even though other statutory functions fall within the public-powers exclusion.

The Public and Commercial Services Union complained to the Central Arbitration Committee under Regulation 22(1) of the Information and Consultation of Employees Regulations 2004, alleging that the Advisory, Conciliation and Arbitration Service had failed to comply with a negotiated information and consultation agreement.

ACAS challenged the CAC’s jurisdiction. It accepted that it was an undertaking, but argued that its functions did not constitute the carrying out of an economic activity because they were statutory public duties. The CAC held that all its services were economic activity and, alternatively, that its charged-for Good Practice Services constituted an economic activity. ACAS appealed under Regulation 35(6). The central issue was whether ACAS carried out an economic activity within Regulation 2.

1. Appeal dismissed. The CAC’s alternative conclusion was correct and was sufficient to establish jurisdiction.
2. Economic activity includes activity consisting of offering goods or services on a given market. Payment need not come from the consumer or end-user; government funding may constitute remuneration. Economic activity may also be carried on by a monopoly.
3. The exclusion for activities involving the exercise of public powers must be understood in the domestic statutory context. The fact that a public body derives all its powers and duties from statute does not place all its activities outside Regulation 2. The issue must be determined case by case. Traditional governmental and regulatory functions are obvious examples, but the category is not exhaustive.
4. The indefinite article in the expression carrying out an economic activity is significant. It is enough that the legal entity carries out an economic activity which is not merely ancillary or de minimis. This does not subdivide the legal entity into separate undertakings and is consistent with Moyer-Lee.
5. The charged-for Good Practice Services were supplied to customers in a given market. They were neither de minimis nor merely ancillary. Their statutory basis did not bring them within the public-powers exclusion. ACAS therefore carried out an economic activity and was subject to the Regulations.
6. The primary finding that all ACAS services were economic activity was too broad. In particular, ACAS’s statutory conciliation duties under the Employment Tribunals Act 1996, provided exclusively by ACAS before and after tribunal proceedings, did not constitute services supplied in a given market and fell within the public-powers exclusion. That conclusion did not affect the alternative basis for dismissing the appeal.
7. ACAS’s role as conciliator under the Regulations was not an inherent bar to the Regulations applying to its activities.

• Employment Appeal Tribunal: Appeal from the CAC decision dated 15 May 2017 dismissed. The alternative finding that ACAS’s charged-for Good Practice Services constituted an economic activity was upheld.
• Central Arbitration Committee: Held that it had jurisdiction to determine the Union’s complaint under Regulation 22(1), on the basis that all ACAS activities were economic activity or, alternatively, that its charged-for services were economic activity.