Key points

  • A collective agreement (as defined by section 178 of the Trade Union & Labour Relations (Consolidation) Act 1992) is an agreement or arrangement between one or more employers (or employers' associations) and one or more trade unions dealing with one or other of the following matters:

    • 'terms and conditions of employment, or the physical conditions in which any workers are required to work;

    • engagement or non-engagement, or termination or suspension of employment or the duties of employment, of one or more workers;

    • allocation of work or the duties of employment between workers or groups of workers;

    • matters of discipline;

    • a worker's membership or non-membership of a trade union;

    • facilities for officials of trade unions; and

    • machinery for negotiation or consultation, and other procedures, relating to any of the above matters, including the recognition by employers or employers' associations of the right of a trade union to represent workers in such negotiation or consultation or in the carrying out of such procedures.'


      Any term in a collective agreement which purports to discriminate against women (or men) is void and unenforceable (per section 6, Sex Discrimination Act 1986, as amended by the Trade Union Reform & Employment Rights Act 1993).

Is a collective agreement legally binding?

'No strike' clauses

Dismissal procedures agreement

  • A 'dismissal procedures agreement' (as defined in section 235 of the Employment Rights Act 1996) is an agreement (in writing) between an employer and a trade union, the effect (or intended effect) of (or of one or more which is to substitute for the statutory right of an employee to complain of unfair dismissal to an employment tribunal. A dismissal procedures agreement may be a separate agreement or it may form part of a collective agreement. Either way, it will not be legally binding unless specifically 'designated' as such by order of the Secretary of State for Employment. Nor will the Secretary of State make an order designating such an agreement as having effect in substitution for the unfair dismissal provisions of the 1996 Act unless it satisfies all of following conditions prescribed by section 110 of that Act:

    1. Every trade union party to the agreement must be an independent trade union.

    2. The procedures laid down in the agreement for determining the fairness or otherwise of a dismissal (or intended dismissal) must be accessible without discrimination to all employees falling within any description to which the agreement relates.

    3. The remedies provided by the agreement in respect of unfair dismissal must, on the whole, be as beneficial as (but not necessarily identical to) those available to the employment tribunals under Chapter II of Part X of the 1996 Act.

    4. The agreement must include provision either for arbitration in every case or for:

      1. arbitration where (by reason of an equality of votes or for any other reason) a decision under the agreement cannot otherwise be reached; and

      2. a right to submit to arbitration any question of law arising out of such a decision.

    5. The provisions of the agreement must be such that it can be determined with reasonable certainty whether a particular employee is one to whom the agreement applies or not (ibid. section 110(3)).

    But, if the agreement states that it does not apply to particular descriptions of dismissals (eg, the right of an employee under section 99 of the 1996 Act not to be dismissed (or selected for redundancy) on grounds of pregnancy or childbirth (or for a connected reason), the agreement will not operate in relation to a dismissal of any such description (ibid. section 110(2), as substituted by section 12 of the Employment Rights (Dispute Resolution) Act 1998).

  • An award made under a designated dismissal procedures agreement may be enforced (in England and Wales) by leave of the county court, in the same manner as a county court judgment to the same effect is enforced. In Scotland, such an award may be recorded for execution in the Books of Council and Session, and will be enforceable accordingly (ibid. section 110(6), inserted by section 13(3) of the Employment Rights (Dispute Resolution) Act 1998).

  • Section 110(4) of the 1996 Act points out that one or other of the parties to a designated dismissal procedures agreement may apply to the Secretary of State for Employment for an order revoking an order made under section 110(3). The Secretary of State will revoke the order if all parties are agreed or if satisfied that the agreement no longer satisfies all of conditions 1 to 5 above.

Collective agreements and TUPE transfers

  • If there is a collective agreement in force when a business or undertaking is sold or otherwise disposed of, the organisation that purchases or acquires that business inherits that agreement (and all of the seller's obligations under that agreement) in the same way as it inherits the contracts of employment of the persons employed in that business and covered by the provisions of that agreement (regulation 6, Transfer of Undertakings (Protection of Employment) Regulations 1981).

  • Furthermore, if the person selling or transferring his (or her) business recognises an independent trade union as having bargaining rights in respect of some or all of his employees, the new owner must likewise recognise that same trade union in respect of those same employees - although there is nothing to prevent him varying or rescinding that agreement at a later date. However, this rule does not apply unless the business (or part of the business sold) maintains an identity distinct from the remainder of the purchaser 's business. If the new owner simply absorbs the business, or merges it with his existing business, the recognition agreement no longer applies (ibid. regulation 9). See also Continuous employment elsewhere in this handbook.

Collective agreements: detriment and dismissal

  • Section 17 of the Employment Relations Act 1996 empowers the Secretary of State to make regulations about cases where a worker is either dismissed or subjected to detriment by his (or her) employer for refusing to enter into a contract which includes terms which differ from the terms of a collective agreement which applies to that worker. At the time of writing, section 17 had not as yet been brought into force.

Working Time Regulations 1998

  • Regulation 23 of the Working Time Regulations 1998 (as amended) allows that a collective agreement may (in relation to particular workers or groups of workers) modify or exclude those provisions in the regulations which relate to daily and weekly rest periods and in- work rest breaks - but only for adult workers (that is to say, workers aged 18 and over) - so long as the agreement clearly allows those workers to take equivalent periods of compensatory rest (ibid. regulations 23 and 24).

  • Save for young workers under the age of 18, the night work limits imposed by the 1998 Regulations may also be excluded or modified (for all workers, including adolescents) by a collective agreement - so long as an adult worker's average weekly hours (including hours worked at night) do not exceed 48 during the agreed reference period, which latter may be extended (for objective or technical reasons associated with the organisation of work) from 17 to 52 weeks. However, any term in a collective (or workforce) agreement that presumes to override a worker's right not to work more than an average 48 hours a week is void and unenforceable.

  • Finally, a worker's entitlement to a minimum four weeks' paid annual holidays is also sacrosanct - although a collective agreement may determine when the holiday year begins and ends, the procedures to be followed by workers before taking their holidays, and the method to be used to calculate a worker's residual entitlement to holiday on the termination of his (or her) employment. It may also contain a provision allowing a worker who has resigned or been dismissed to compensate his (or her) employer for holidays taken in excess of his statutory entitlement - whether by a payment, by undertaking additional work, or otherwise (ibid. regulation 14(4)).

Other legislation

  • Information about the role and validity of collective (or workforce) agreements in the context of the rights of fixed-term employees under the Fixed-term Employees (Prevention of Less Favourable Treatment) Regulations 2002, is to be found elsewhere in this handbook in the section titled Fixed-term employees.