20 May 2024 Jonathan Jones  -  Alexander Fawke  - Louise Mason - Will Smith Employment and Incentives

UK Supreme Court gives guidance on Human Rights Act

Treading the boundaries of permissible interpretation: Secretary of State for Trade and Business v Mercer 

The UK Supreme Court has issued a declaration of incompatibility under section 4 of the Human Rights Act, finding that an element of UK employment law is incompatible with the right to freedom of assembly and association under the European Convention on Human Rights. It held that UK law fails to provide any protection against sanctions, short of dismissal, intended to deter or penalise workers from taking part in lawful strike action organised by their trade union (see Secretary of State for Business and Trade v Mercer [2024] UKSC 12).

This judgment provides important guidance on the factors the court will consider when: 

  • deciding whether to use section 3 of the HRA to interpret a piece of domestic legislation in an ECHR-compliant way; and
  • deciding whether to issue a declaration of incompatibility under section 4 of the HRA.

Background 

The Appellant, Ms Mercer, was a support worker in the care sector who was involved in planning and participating in lawful strike action at her workplace. She was suspended by her employer and during her suspension received no pay for the overtime she would normally have worked, though she still received her basic salary. The effect of her suspension was also to remove her from her workplace while the industrial action was in progress. 

Ms Mercer brought a complaint to the Employment Tribunal, alleging that her suspension was imposed for the sole or main purpose of preventing her from taking part in trade union activities at “an appropriate time” (see section 146 of the Trade Union and Labour Relations (Consolidation) Act 1992 (TULRCA)) or penalising her for having done so. Ms Mercer also argued that the protection afforded by article 11 of the European Convention on Human Rights (ECHR), together with the strong interpretative provision in section 3 of the Human Rights Act, 1998 (HRA), made it possible to construe section 146 compatibly with article 11 to offer extended protection to workers against detriment short of dismissal for participating in lawful strike action.

Section 146 TULRCA

The relevant provision reads as follows:

Detriment on grounds related to union membership or activities

(1) A worker has the right not to be subjected to any detriment as an individual by any act, or any deliberate failure to act, by his employer if the act or failure takes place for the sole or main purpose of - 

(a)preventing or deterring him from being or seeking to become a member of an independent trade union, or penalising him for doing so,

(b) preventing or deterring him from taking part in the activities of an independent trade union at an appropriate time, or penalising him for doing so,  

(c)preventing or deterring him from making use of trade union services at an appropriate time, or penalising him for doing so, or]

(d)compelling him to be or become a member of any trade union or of a particular trade union or of one of a number of particular trade unions.

(2) In subsection (1)“an appropriate time” means—

(a) a time outside the worker's working hours, or

(b) a time within his working hours at which, in accordance with arrangements agreed with or consent given by his employer, it is permissible for him to take part in the activities of a trade union or (as the case may be) make use of trade union services;

and for this purpose “working hours”, in relation to a worker, means any time when, in accordance with his contract of employment (or other contract personally to do work or perform services), he is required to be at work.

Her claim progressed to the Court of Appeal, which found against Ms Mercer. The Court of Appeal held that using section 3 of the HRA to read into section 146 of TULRCA a new sub-paragraph to extend the definition of “appropriate time” to “a time within working hours when he is taking part in industrial action” would amount to impermissible judicial legislation beyond the scope of section 3 of the HRA. 

The Court of Appeal also declined to grant a declaration of incompatibility under section 4 of the HRA on the grounds that it was not appropriate to make such a declaration where “there is a lacuna in the law rather than a specific statutory provision which is incompatible… the extent of the incompatibility is unclear and the legislative choices are far from being binary questions”.

Ms Mercer appealed the Court of Appeal’s decision to the Supreme Court, which considered the circumstances in which is appropriate for the courts to use section 3 and section 4 of the HRA. 

Decision

When is it appropriate for the court to use section 3 of the HRA to read domestic legislation in a way which is compatible with the ECHR?

In considering this question, the Supreme Court acknowledged that section 3 of the HRA does require, as far as it is possible to do so, primary legislation to be read and given effect in a way which is compatible with rights guaranteed under the ECHR. 

Nonetheless, the Supreme Court reiterated that there are limits to the use of section 3 of the HRA. Not all provisions in primary legislation can be rendered ECHR-compliant by the application of section 3(1) of the HRA. Despite this “powerful tool”, “it does not enable the court to change the substance of a provision from one where it says one thing into one that says the opposite” or “to adopt a meaning inconsistent with a fundamental feature of legislation”. 

Despite limits on the use of this “powerful tool”, the Supreme Court recognised that section 3 “can require a court to read in words which change the meaning and the effect of the legislation to achieve a compatible interpretation”. The question remained: when is it appropriate to do so?

The Supreme Court did not provide comprehensive guidance on this question. However, it did indicate two factors it will consider when deciding whether to apply section 3 of the HRA: 

  • Where there is no “single, obvious legislative solution that will ensure compliance with [ECHR-rights] while at the same time maintaining an appropriate balance between the competing rights” of those effected, this will count against the courts deciding to apply section 3 of the HRA.
  • Where it is not clear to the court whether Parliament, had it considered the question, would have chosen to legislate in the way the court is being asked to, this would also count against the courts deciding to apply section 3 of the HRA.

While stopping short of providing a roadmap to instances where the courts will use section 3 of the HRA, the Court was clear that using this provision where it is not clear that Parliament would have chosen to legislate in that way and where policy choices are invoked, is “tantamount to judicial legislation”. 

Policy choices are inevitably invoked when seeking to re-interpret a piece of domestic legislation. However, on the facts of this case, the Supreme Court held that the interpretation of TULRCA proposed by Ms Mercer “fundamentally alters the scope and structure of the rights conferred” by the piece of domestic legislation and re-draws the balance between workers’ and employers’ rights. 

The Supreme Court was therefore satisfied that this “goes beyond the permissible boundary of interpretation” and declined to use section 3 of the HRA in this way. 

When is it appropriate for the courts to make a declaration that domestic legislation is incompatible with an ECHR right? 

Having concluded that using section 3 of the HRA to adopt an ECHR-compliant construction was not possible, the Supreme Court considered whether the Court of Appeal was correct to decline to make a declaration of incompatibility under section 4 of the HRA. 

On this question, the Supreme Court was clear in its reasoning. The Supreme Court held that to make a declaration there must be an identifiable provision in primary legislation which is itself incompatible with the ECHR. That is because the express focus of section 4(1) of the HRA is on “a provision of primary legislation”. Only if that provision is found to be incompatible may a declaration of incompatibility be made. In this case the Court concluded that section 146 of TULRCA was a “specific statutory provision giving rise to the incompatibility” with article 11 of the ECHR.

The Supreme Court emphasised the discretionary nature of the section 4(2) remedy, reiterating that section 4(2) plainly contemplates that there may be circumstances where it is not appropriate to exercise this power.  

The Supreme Court acknowledged that the wide variety of circumstances in which the court may be called upon to make a declaration make it difficult to identify the particular considerations favouring one course rather than the other. 

However, in overturning the Court of Appeal’s ruling, the Supreme Court held that, in the following circumstances, there are good reasons in favour of making a declaration of incompatibility, not refusing one:

  • the ultimate legislative solution to the problem identified in the case may call for enquiry;
  • questions of policy would need to be addressed and evaluated;
  • the practical ramifications of such policy choices would need to be considered; and
  • a fair balance would need to be struck between all the competing interests at stake.

In such instances, the Supreme Court held, a declaration of incompatibility is wholly appropriate, as it is for Parliament to then decide whether to legislate to remedy the incompatibility and if so, to decide the scope and nature of the protection to be provided. 

Comment

  • This judgment provides important guidance as to the circumstances in which the court will be persuaded to use section 3 of the HRA to interpret domestic legislation in a way that is compliant with the ECHR. This remains a difficult line to draw, with judicial guidance pointing in different directions. On the one hand, courts are entitled to “change the meaning and the effect of the legislation”, and the legislation does not need to be ambiguous for them to do so. On the other, the courts are understandably concerned about the limits of this, and the risk of judicial legislation.
  • The judgment stops short of providing a comprehensive roadmap but indicates that where there is ambiguity in what Parliament’s intentions would have been had it considered the incompatible provision, this will count against using section 3 of the HRA. The judgment also indicated that, where re-interpreting a piece of domestic legislation involves serious policy choices with far reaching consequences that fundamentally alter the scope of rights conferred by the legislation, using section 3 of the HRA goes beyond the permissible boundary of interpretation.
  • The Supreme Court was somewhat clearer about the circumstances in which it would be appropriate to issue a declaration of incompatibility. Declarations are appropriate where an incompatibility between a provision of the ECHR and a piece of UK primary legislation has been identified and remedying this incompatibility would require questions of policy to be addressed and evaluated, to bring the issue to the attention of Parliament and the executive.