Collective terms 




In the UK, the vast majority of collective agreements are not legally binding on the two parties — union and employer (section 179, TULRCA). Instead, they are binding “in honour” and backed up voluntarily by good employment relations and by the implicit threat of industrial action. Only collective terms that have been incorporated into the employment contract are legally binding.


Collective terms, once incorporated into an individual contract of employment, can only be changed by agreement. Where a trade union is recognised, agreement should be reached through collective bargaining.




A rare example of a legally binding collective agreement is the Agenda for growth, stability and long-term success, negotiated by the communication workers’ union CWU and the Royal Mail in January 2014. The collective agreement contains several “legally binding undertakings” by Royal Mail, for example, not to outsource, TUPE-transfer or franchise, nor to use zero- hours contracts, or to engage new employees on inferior terms. 


However, the agreement, while ground-breaking, also illustrates the pitfalls of legal enforceability in the context of fast-moving industrial disputes. In 2017, Royal Mail successfully secured an injunction preventing strike action in a dispute over pensions, pay, a shorter working week and continuation of the agreement, until external mediation had been exhausted. The planned strike had the overwhelming backing of members (turnout of 73.7%, with 89.1% voting in favour). The union argued that Royal Mail should have applied promptly for mediation and instead delayed for several weeks, only taking this step once the ballot result was published and notice of the industrial action had been served. But the High Court ruled that the strike call was an unlawful breach of a contractual promise not to call for strike action until the external mediation process had been exhausted (Royal Mail Group Limited v CWU [2017] EWHC 2548).