Introduction

The case of National Union of Rail, Maritime and Transport Workers & Anor v Tyne and Wear Passenger Transport Executive (t/a Nexus) ([2024] UKSC 37) represents a significant development in employment law, particularly concerning the rectification of collective agreements. This case examines whether collective agreements, which are typically not legally enforceable unless expressly stated, can be rectified when inaccurately recorded and subsequently incorporated into individual employment contracts. The parties involved are Nexus, the employer, and two independent trade unions: the National Union of Rail, Maritime and Transport Workers and Unite the Union.

Central to this case are questions about the possibility and proper parties for rectification of collective agreements, especially when these agreements are mistakenly recorded and influence legally enforceable employment contracts.

Summary of the Judgment

The Supreme Court upheld the decision of the Court of Appeal, which dismissed Nexus's claim for rectification against the trade unions. Nexus had sought to rectify a letter agreement that inaccurately recorded a collective bargaining outcome, arguing that the mistake should be corrected to reflect the true agreement. However, the courts determined that the proper defendants for such a rectification claim are the individual employees whose contracts incorporate the terms of the collective agreement, not the unions themselves. The Supreme Court concluded that Nexus's approach was procedurally flawed and that attempting to rectify the collective agreement against the unions would be an abuse of process.

Analysis

Precedents Cited

The Judgment references several key cases that have shaped the understanding of rectification in English law:

• Joscelyne v Nissen [1970] 2 QB 86: Established that rectification does not require the existence of a legally enforceable contract but is based on the common intention of the parties.
• National Coal Board v National Union of Mineworkers [1986] ICR 736: Highlighted the limitations courts face when dealing with non-enforceable collective agreements.
• Persimmon Homes Ltd v Hillier [2019] EWCA Civ 800: Demonstrated that rectification is possible for documents that, while not legally enforceable themselves, affect legal rights when incorporated into other legally binding documents.
• Rolls-Royce Plc v Unite the Union [2009] EWCA Civ 387: Addressed the procedural challenges and propriety of bringing claims related to non-enforceable collective agreements.

Legal Reasoning

The Supreme Court's legal reasoning centered on the nature of rectification as an equitable remedy aimed at correcting the written record to reflect the true agreement between parties. The Court clarified that while collective agreements are generally not legally enforceable contracts unless explicitly stated, their terms can become enforceable when incorporated into individual employment contracts.

The Court emphasized that rectification should target the incorrect document—the letter agreement—not the abstract collective agreement itself. Since the letter agreement was incorporated into individual contracts, any rectification would directly affect those contracts. Therefore, the correct parties to seek rectification against are the individual employees, whose contracts would mirror the rectified terms, thereby altering their rights and obligations.

Additionally, the Court upheld the principle that disputing or altering the terms of a collective agreement should involve the parties directly affected by those terms—in this case, the employees—not the unions, who are representatives rather than direct beneficiaries of the agreement.

Impact

This Judgment has profound implications for employment law and industrial relations. It clarifies that:

• Rectification of collective agreements is permissible even if the agreements themselves are not legally enforceable, provided that the terms are incorporated into enforceable individual contracts.
• Claims for rectification should be directed at the proper parties—namely, the employees whose contracts are affected—not at the trade unions.
• Employers must ensure that written records of collective agreements accurately reflect the true agreements reached during negotiations to avoid protracted litigation.

Furthermore, this decision underscores the importance of correctly identifying and pursuing claims against the appropriate parties to ensure procedural justice and the effectiveness of equitable remedies.

Complex Concepts Simplified

Conclusion

The Supreme Court's decision in National Union of Rail, Maritime and Transport Workers & Anor v Tyne and Wear Passenger Transport Executive (t/a Nexus) reinforces the importance of correctly addressing legal remedies within the appropriate procedural and factual contexts. By determining that rectification claims concerning collective agreements should be directed at individual employees rather than trade unions, the Court has provided clear guidance for future disputes involving the accuracy of negotiated employment terms.

This ruling ensures that equitable remedies like rectification are accessible in scenarios where collective bargaining agreements impact legally enforceable contracts, thereby safeguarding the rights of employees and maintaining the integrity of employment contracts. Employers must meticulously document negotiations to prevent such disputes, and legal practitioners must accurately identify the proper parties when seeking rectification.

Overall, this Judgment signifies a crucial advancement in employment law, balancing the interests of employers, employees, and trade unions while upholding principles of fairness and proper legal procedure.