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The London Employment Appeal Tribunal has rejected an appeal by the GMB union against an employment tribunal finding that branch secretaries are entitled to employment rights even though they are office holders. The decision of the EAT in the case GMB Trade Union & Others v Hughes & Another was given on 2 August 2006.
Mr. Hughes and Mr. Beaumont are branch secretaries for the GMB union. Individuals holding the office of branch secretary are required to keep all necessary books and accounts, maintain a register of members and forward it to the Regional Secretary when required, properly secure and take care of the finances in his possession, and report any neglect by the collecting stewards. Payment for these duties is 10% of branch fees and, in the case of Mr. Hughes and Mr. Beaumont, this amounted to around £;45,000 and £;20,000 each year respectively.
The GMB viewed branch secretaries and lay officials as not engaged under contract of employment. However, the original employment tribunal heard evidence that the duties of their office were only about 10% of the work they performed. The other 90% of their work, including representation, negotiation and consultation which they carried out on behalf of union members, was not part of their duties as office holders. They were subject to a measure of regional control, although they had considerable autonomy as to how and when they do their work.
The tribunal decided that
- Mr. Hughes and Mr. Beaumont worked full-time in return for substantial remuneration, including pension benefits, which could not be described as an honorarium
- they worked under a sufficient degree of GMB control
- their duties went well beyond those defined by their office
Accordingly, the tribunal ruled that they worked under a contract of service and were therefore employees and workers for the purpose of employment rights.
The EAT considered various arguments on appeal, none of which it accepted as raising any valid point of law that would invalidate the employment tribunal's decision. The EAT commented, however, that the issue before the tribunal was not whether the branch secretaries were office holders or employees working under a contract of service. Rather, the issue was whether they could be both office holders and employees at the same time. The arrangements are not mutually exclusive.
The issue of office holders being employees also arises in the context of company directors. Directors are assumed to be performing the duties of their office unless they also have a contract of service or employment with the company. For example, payments made to a director who does not have a contract of employment are not subject to national minimum wage rules or to rights under the working time regulations.
...back to 17 August 2006
Source:
GMB Trade Union & Ors v Hughes & Anor (2006)
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