Secretary of State for the Department for Environment, Food and Rural Affairs v Public and Commercial Services Union

Appellant

Oliver Segal KC

Darshan Patel

(Instructed by Thompsons Solicitors LLP)

Respondents

Daniel Stilitz KC

Jack Feeny

(Instructed by the Government Legal Department)

Lord Sales and Lady Rose (with whom Lord Reed and Lady Simler agree):

1. INTRODUCTION

1. The respondent employers are three Government departments. Some of their employees, including the individual claimants in these proceedings, are members of the Public and Commercial Services Union ("the Union"). The Union is recognised for collective bargaining purposes by those employers. The individual claimants chose in the past to have their union subscription deducted from their salary at source through the pay roll system. The sum deducted would then be paid over to the Union by the employer. This is referred to as a check-off arrangement.
2. In 2014 or 2015, the employers stopped the check-off arrangements leaving the employees to make their own arrangements for paying their union subscription. It is now accepted by the Government that the unilateral withdrawal of the check-off arrangements was a breach by the respondent departments of their employees' contracts of employment. The withdrawal of the check-off arrangements led to a substantial reduction in the subscription income of the Union.
3. A number of employees brought actions against the employers for breach of their contracts of employment in these and earlier proceedings. Those claims were successful but they could only address the position of each individual employee who brought a claim. Further, it was not clear what loss the employees had suffered, given that the result of the breach was that they received more in their monthly salary than they had before. The person who had really suffered the loss was the Union, but the Union was not a party to the contract of employment and so did not, under common law, have a right to sue for that breach.
4. The Union considered that this difficulty was precisely the kind of difficulty that had been addressed - and resolved in their favour - by the enactment of the Contracts (Rights of Third Parties) Act 1999 ("the 1999 Act"). The Union therefore also brought its own claims against the employers alongside those of the individual employees, asserting that the contracts of employment in dispute fulfilled the criteria set out in the 1999 Act. They claimed to be entitled to rely on the third party right provided by section 1 to enforce the term of the contracts of employment containing the check-off arrangements.
5. The individual claimants and the Union succeeded in the High Court in the three separate actions which have directly led to this appeal. The actions were:

a.         Cox and others v Secretary of State for the Home Department in which judgment was given on 23 March 2022 by Choudhury J: [2022] EWHC 680 (QB); [2023] ICR 283; [2022] IRLR 502 ("the Cox judgment");  

b.         Crane and others v Secretary of State for the Department for Environment, Food and Rural Affairs in which judgment was given on 24 June 2022 by Choudhury J: [2022] EWHC 1626…