The victory for employers using facilities management services


Employers and organisations that use facilities management companies are most likely relieved to know that a recent landmark test case filed with the Central Arbitration Committee (CAC) by the Independent Workers Union of Great Britain (IWGB) was unsuccessful. The case filed by IGWB related primarily to whether outsourced workers employed by a facilities management service company had a right to be included in collective bargaining over pay and conditions directly with the end user (the client). In determining this matter the central issue considered by the CAC was whether the University could be regarded as an “employer” of the outsourced workers in the proposed bargaining unit.

What happened?

IGWB sent a letter to University of London requesting that they should be recognised as the trade union responsible for representing a collective bargaining unit. The collective bargaining unit to which they referred comprised of 75 workers who provided services at various sites across the University via their direct employment with the facilities management company Cordant Security. The roles which they performed related to security, post room, porter services and reception duties. The University refused IGWB’s request on the basis that they did not employ the workers. The University considered that the workers within the proposed bargaining unit were directly employed by Cordant Security. Interestingly, IGWB also agreed that an employment relationship existed between the workers and Cordant Security but the Union strongly held the view that the University was a “de facto” employer of these workers.  As the University held steadfast to it position the Union made an application to CAC to consider its application for recognition to collective bargain on behalf of the workers.

When the application arrived before the CAC panel the central issue to be determined was who employed the workers identified in the bargaining unit? Was it Cordant Security alone? Or did Cordant Security and the University jointly employer the workers?  IGWB put forward the proposition that it was not inconceivable in law for the workers to be actually employed by Cordant Security and the University at the same time. The premise for this argument was that because the University effectively told Cordant what its service level agreement expectations were that this in turn had a substantial determining influence on the terms and conditions which Cordant then offered to the workers in relation to pay, hours and holiday.

It should be noted that at the time of this application the group which IGWB were seeking to represent already had another trade union (Unison) in place. Unison were voluntarily recognised by Cordant Security for the purpose of collective bargaining in connection with pay and working conditions for the workers.  Consequently, if IGWB’s application for recognition had been successful the end result would have meant that the workers within the proposed bargaining unit would have had two unions and two separate collective bargaining agreements representing the same interests relating to pay and working conditions. This undoubtedly as the panel remarked, is a “recipe for chaotic workplace relationships”. 

The decision

On 10 January 2018 the CAC panel arrived at a sensible judgment which steered the University away from the looming chaotic working relations that were in store had IGWB application been successful.   The panel held that it was satisfied that the University of London was not the employer of the outsourced workers who provided services through the facilities management company. Of particular note, the panel stated, “… for the Union's case to succeed, there must still be a contract between each individual worker in the bargaining unit on the one hand and the University on the other hand. That is an absolute requirement.” No such contract existed, consequently, IGWB’s application that the University should recognise it as a trade union for the purpose of collective bargaining failed.

On this occasion the decision went in favour of the employer and judging from the CAC panel’s comments it’s unlikely that any future applications will be decided any differently as the panel made it quite clear that its function was to interpret the law and “…an expansion to the definition of "worker" and "employer" is a matter for Parliament”, not the panel.