The Supreme Court has allowed an appeal by Aer Lingus maintenance and engineering workers, removing a four-year limit on guarantees that they would retain their employment status and entitlements after secondment to TEAM Aer Lingus.
In a judgment delivered by Mr Justice McCracken on 20 December 2005, the Court held that the guarantees were intended to preserve the workers’ position as if TEAM had never existed. It rejected the view that those guarantees expired after a “reasonable time” following the workers’ return to Aer Lingus.
The dispute followed negotiations in 1990 over the creation of TEAM, a separate company within the Aer Lingus group. The workers and their unions sought assurances that secondment would not prejudice their employment status, conditions, seniority or benefits. A final agreement said the guarantees would be legally binding, form part of each worker’s employment contract and be enforceable by the individual employee. Workers approved the proposals in a third ballot.
Aer Lingus later sold TEAM to FLS Aerospace. About three per cent of its workforce, including the appellants, chose to return to Aer Lingus; the judgment says about 80 people transferred back, while only about 40 technical jobs were available. Some returning workers were placed in other jobs, some of which would normally pay less than maintenance and engineering work.
The High Court had ruled that the workers remained Aer Lingus employees and were entitled, after their secondment ended, to be treated as if TEAM had never existed. It limited that entitlement to four years from the end of secondment and awarded damages on that basis. The workers appealed the time limit. Aer Lingus had filed a notice to vary the High Court decision but was no longer pursuing it, and accepted the trial judge’s findings.
The Supreme Court said the central guarantees concerned status, seniority, working conditions, rights and privileges, including pension entitlements. The Court found no basis to limit those guarantees in time: doing so could leave the returning workers worse off than colleagues who had never transferred. It distinguished these guarantees from a separate assurance in a personnel letter that existing employees would continue to maintain the Aer Lingus fleet “as a minimum” if TEAM encountered business difficulties. That assurance was not part of the binding guarantees in the final agreement.
The ruling did not give the appellants special protection from ordinary employment risks. The Court said they remained subject to the ordinary terms of employment, including termination on notice, dismissal on reasonable grounds and redundancy. The Supreme Court allowed the appeal on the time limit; the source does not state a new damages calculation or further order.