Court of Appeal provides important guidance on collective bargaining and employment contracts
Image of Ed Williams KC
In Crabb and others v TUI Airways Ltd [2026] EWCA Civ 988, the Court of Appeal has provided important guidance on the effect of collective bargaining on individual contracts of employment.
Ed Williams KC, leading Andrew Edge of 11KBW, successfully represented TUI Airways in defending a multi-million pound claim brought by a group of pilots concerning changes to their permanent health insurance (PHI) benefits. Ed was instructed by Dentons.
At first instance
Following a significant increase in the cost of providing PHI insurance, TUI reached a collective agreement with BALPA to introduce a new PHI scheme. A group of pilots challenged the changes, arguing that they breached their individual contracts of employment and could not be implemented without their individual consent.
The High Court dismissed the claims, concluding that the changes had been introduced through the contractual collective bargaining mechanism rather than by unilateral amendment.
The appeal
The pilots appealed, arguing that a provision within the TUI Handbook prevented the company from reducing their PHI rights through collective bargaining.
The Court of Appeal dismissed the appeal, holding that the contractual provision relied upon by the pilots protected employees against unilateral changes by the employer, but did not prevent changes being made pursuant to a collective agreement incorporated into individual contracts of employment.
Points to note
The judgment provides important guidance on the interaction between collective bargaining and individual contracts of employment.
In addition to considering recent Supreme Court authorities on the relationship between trade unions, employers and employees, and the circumstances in which employment contracts can and cannot be varied, the judgment also contains significant observations on the purpose of collective bargaining, recognising that there may often be both winners and losers, a "possibility which is inherent in any system of collective bargaining."
The decision also confirms that where parties seek to exclude particular contractual rights from the scope of collective bargaining, the courts will expect clear contractual language.
Conclusion
The judgment is likely to become an important authority for employment and trade union practitioners, particularly in relation to collectively agreed contractual variations.
The Court of Appeal's judgment can be read here.
