Trade Disputes Act 1906
Encyclopedia
The Trade Disputes Act 1906 (6 Edward VII, c 47) was an Act
of the Parliament of the United Kingdom
passed under the Liberal
government of Sir Henry Campbell-Bannerman
. The Act declared that unions could not be sued for damages
incurred during a strike.
Its key reform was to add the famous words, now found in TULRCA 1992 section 219, to the Conspiracy and Protection of Property Act 1875
that, ‘An act done in pursuance of an agreement or combination by two or more persons shall, if done in contemplation or furtherance of a trade dispute, not be actionable unless the act, if done without any such agreement or combination, would be actionable.’
, which had for the first time imposed damages in tort
on trade unions for going on strike. Previously, the legal status of trade unions as an "unincorporated association", was accepted to mean that they did not have legal standing to sue, or be sued, in court.
Before the change, the two important cases were Lumley v Gye (1857) and Allen v Flood (1897). Lumley did not concern trade unions, but invented a new legal principle. An actress, Miss Wagner, had been engaged by Mr. Lumley to sing at Her Majesty's Theatre. Mr. Gye, who ran Covent Garden, procured her to break her contract with Mr. Lumley by promising to pay her more. He was held liable to Mr. Lumley for inducing a breach of contract. This is a principle readily applicable to union situations. In the case of a strike, a union effectively persuades or decides for workers to go on strike, in breach of their contracts with employers. But in Allen, the House of Lords held that a trade union could not be sued by a non-union worker for pressuring the employer into not hiring them. They said that even though the union's motive was malicious, the employer not hiring the non-union worker was lawful.
But then, Taff Vale Railway Co v Amalgamated Society of Railway Servants (1901) surprised everyone by saying that trade union
s could be held liable for damages caused by industrial action. The Lords said if unions can harm people, they are bodies capable of being sued. The Labour movement was so incensed that it met at Farringdon Town Hall and resolved to form a Labour Party
to get the decision reversed in Parliament. Two further cases followed worsening the possibility to collectively bargain. Quinn v Leatham ended all possibilities of a closed shop and South Wales Miners' Federation v Glamorgan Coal Co held that a union which induced a breach of contract had no defence of an "honest motive" (for instance, wanting to improve working conditions and get fair pay for employees).
in the general election of 1906
. A minority in the new Cabinet, including Campbell-Bannerman and John Burns
, wanted to introduce a Bill stating that trade unions could not be liable for damages. However the majority opinion in the Cabinet, led by H. H. Asquith
and other members with legal experience, argued that this would make unions too powerful and instead proposed to limit the application of the law of agency
in respect to union activities. The latter faction prevailed and a Bill was introduced on 28 March 1906 by the Solicitor General for England and Wales
, William Robson
. Many of the radical MPs did not understand the complicated legal wording of the Bill and so trade union MPs, led by W. Hudson, introduced their own Bill.
, John Lawson Walton
, "who tore it to pieces in his best forensic style". Without warning his colleagues Campbell-Bannerman spoke in favour of the trade unionists' Bill:
The Conservative MP George Wyndham
said he had heard Campbell-Bannerman's peroration with blank amazement as it was incredible that he should on Friday request that MPs vote for a Bill which his Attorney-General had strongly denounced on Wednesday. Asquith and the rest of the Government opposition to the trade unionists' Bill argued against it inside the Cabinet but the outcome of the Committee dealing with the Bill in August was to favour the trade unions' alternative.
During the Second Reading of the Trade Disputes Bill, Sir William Robson
noted that the Bill was intended to prevent "industrial conflict being the subject of litigation."
wrote in his The Strange Death of Liberal England
:
The English constitutional theorist A. V. Dicey
argued that the Act conferred
The economist Joseph Schumpeter
in his book Capitalism, Socialism and Democracy said of the Act:
It remained in force until 1971. For the centenary of the Act, the Trades Union Congress
campaigned for a Trade Union Freedom Bill.
Act of Parliament
An Act of Parliament is a statute enacted as primary legislation by a national or sub-national parliament. In the Republic of Ireland the term Act of the Oireachtas is used, and in the United States the term Act of Congress is used.In Commonwealth countries, the term is used both in a narrow...
of the Parliament of the United Kingdom
Parliament of the United Kingdom
The Parliament of the United Kingdom of Great Britain and Northern Ireland is the supreme legislative body in the United Kingdom, British Crown dependencies and British overseas territories, located in London...
passed under the Liberal
Liberal Party (UK)
The Liberal Party was one of the two major political parties of the United Kingdom during the 19th and early 20th centuries. It was a third party of negligible importance throughout the latter half of the 20th Century, before merging with the Social Democratic Party in 1988 to form the present day...
government of Sir Henry Campbell-Bannerman
Henry Campbell-Bannerman
Sir Henry Campbell-Bannerman GCB was a British Liberal Party politician who served as Prime Minister of the United Kingdom from 1905 to 1908 and Leader of the Liberal Party from 1899 to 1908. He also served as Secretary of State for War twice, in the Cabinets of Gladstone and Rosebery...
. The Act declared that unions could not be sued for damages
Damages
In law, damages is an award, typically of money, to be paid to a person as compensation for loss or injury; grammatically, it is a singular noun, not plural.- Compensatory damages :...
incurred during a strike.
Its key reform was to add the famous words, now found in TULRCA 1992 section 219, to the Conspiracy and Protection of Property Act 1875
Conspiracy and Protection of Property Act 1875
The Conspiracy and Protection of Property Act 1875 is an Act of the Parliament of the United Kingdom relating to labour relations, which together with the Employers and Workmen Act 1875, fully decriminalised the work of trade unions...
that, ‘An act done in pursuance of an agreement or combination by two or more persons shall, if done in contemplation or furtherance of a trade dispute, not be actionable unless the act, if done without any such agreement or combination, would be actionable.’
Law
The immediate cause for the Act was a trilogy of cases in the House of LordsHouse of Lords
The House of Lords is the upper house of the Parliament of the United Kingdom. Like the House of Commons, it meets in the Palace of Westminster....
, which had for the first time imposed damages in tort
Tort
A tort, in common law jurisdictions, is a wrong that involves a breach of a civil duty owed to someone else. It is differentiated from a crime, which involves a breach of a duty owed to society in general...
on trade unions for going on strike. Previously, the legal status of trade unions as an "unincorporated association", was accepted to mean that they did not have legal standing to sue, or be sued, in court.
Before the change, the two important cases were Lumley v Gye (1857) and Allen v Flood (1897). Lumley did not concern trade unions, but invented a new legal principle. An actress, Miss Wagner, had been engaged by Mr. Lumley to sing at Her Majesty's Theatre. Mr. Gye, who ran Covent Garden, procured her to break her contract with Mr. Lumley by promising to pay her more. He was held liable to Mr. Lumley for inducing a breach of contract. This is a principle readily applicable to union situations. In the case of a strike, a union effectively persuades or decides for workers to go on strike, in breach of their contracts with employers. But in Allen, the House of Lords held that a trade union could not be sued by a non-union worker for pressuring the employer into not hiring them. They said that even though the union's motive was malicious, the employer not hiring the non-union worker was lawful.
But then, Taff Vale Railway Co v Amalgamated Society of Railway Servants (1901) surprised everyone by saying that trade union
Trade union
A trade union, trades union or labor union is an organization of workers that have banded together to achieve common goals such as better working conditions. The trade union, through its leadership, bargains with the employer on behalf of union members and negotiates labour contracts with...
s could be held liable for damages caused by industrial action. The Lords said if unions can harm people, they are bodies capable of being sued. The Labour movement was so incensed that it met at Farringdon Town Hall and resolved to form a Labour Party
Labour Party (UK)
The Labour Party is a centre-left democratic socialist party in the United Kingdom. It surpassed the Liberal Party in general elections during the early 1920s, forming minority governments under Ramsay MacDonald in 1924 and 1929-1931. The party was in a wartime coalition from 1940 to 1945, after...
to get the decision reversed in Parliament. Two further cases followed worsening the possibility to collectively bargain. Quinn v Leatham ended all possibilities of a closed shop and South Wales Miners' Federation v Glamorgan Coal Co held that a union which induced a breach of contract had no defence of an "honest motive" (for instance, wanting to improve working conditions and get fair pay for employees).
Politics
The Liberal Party was returned with a large majority in the House of CommonsBritish House of Commons
The House of Commons is the lower house of the Parliament of the United Kingdom, which also comprises the Sovereign and the House of Lords . Both Commons and Lords meet in the Palace of Westminster. The Commons is a democratically elected body, consisting of 650 members , who are known as Members...
in the general election of 1906
United Kingdom general election, 1906
-Seats summary:-See also:*MPs elected in the United Kingdom general election, 1906*The Parliamentary Franchise in the United Kingdom 1885-1918-External links:***-References:*F. W. S. Craig, British Electoral Facts: 1832-1987**...
. A minority in the new Cabinet, including Campbell-Bannerman and John Burns
John Burns
John Elliot Burns was an English trade unionist and politician of the late 19th and early 20th centuries, particularly associated with London politics. He was a socialist and then a Liberal Member of Parliament and Minister. He was anti-alcohol and a keen sportsman...
, wanted to introduce a Bill stating that trade unions could not be liable for damages. However the majority opinion in the Cabinet, led by H. H. Asquith
H. H. Asquith
Herbert Henry Asquith, 1st Earl of Oxford and Asquith, KG, PC, KC served as the Liberal Prime Minister of the United Kingdom from 1908 to 1916...
and other members with legal experience, argued that this would make unions too powerful and instead proposed to limit the application of the law of agency
Law of agency
The law of agency is an area of commercial law dealing with a contractual or quasi-contractual, or non-contractual set of relationships when a person, called the agent, is authorized to act on behalf of another to create a legal relationship with a third party...
in respect to union activities. The latter faction prevailed and a Bill was introduced on 28 March 1906 by the Solicitor General for England and Wales
Solicitor General for England and Wales
Her Majesty's Solicitor General for England and Wales, often known as the Solicitor General, is one of the Law Officers of the Crown, and the deputy of the Attorney General, whose duty is to advise the Crown and Cabinet on the law...
, William Robson
William Robson, Baron Robson
William Snowdon Robson, Baron Robson PC was an English lawyer, judge and Liberal politician who sat in the House of Commons in two periods between 1885 and 1910....
. Many of the radical MPs did not understand the complicated legal wording of the Bill and so trade union MPs, led by W. Hudson, introduced their own Bill.
Passage through Parliament
The Private Members' Bill was severely criticised by the Attorney General for England and WalesAttorney General for England and Wales
Her Majesty's Attorney General for England and Wales, usually known simply as the Attorney General, is one of the Law Officers of the Crown. Along with the subordinate Solicitor General for England and Wales, the Attorney General serves as the chief legal adviser of the Crown and its government in...
, John Lawson Walton
John Lawson Walton
Sir John Lawson Walton KC was a British barrister and Liberal politician.-Family and education:John Lawson Walton was the son of the Reverend John Walton MA, a Wesleyan missionary in Ceylon who later preached at Grahamstown in South Africa and who became President of the Wesleyan Conference for...
, "who tore it to pieces in his best forensic style". Without warning his colleagues Campbell-Bannerman spoke in favour of the trade unionists' Bill:
I have never been, and I do not profess to be now, very intimately acquainted with the technicalities of the question, or with the legal points involved in it. The great object then was, and still is, to place the two rival powers of capital and labour on an equality so that the fight between them, so far as fight is necessary, should be at least a fair one. ...I always vote on the second reading of a Bill with the understood reservation of details, which are to be considered afterwards. That is the universal practice. Shall I repeat that vote today? [Cries of "Yes".] I do not see any reason under the sun why I should not.
The Conservative MP George Wyndham
George Wyndham
George Wyndham PC was a British Conservative politician, man of letters, noted for his elegance, and one of The Souls.-Background and education:...
said he had heard Campbell-Bannerman's peroration with blank amazement as it was incredible that he should on Friday request that MPs vote for a Bill which his Attorney-General had strongly denounced on Wednesday. Asquith and the rest of the Government opposition to the trade unionists' Bill argued against it inside the Cabinet but the outcome of the Committee dealing with the Bill in August was to favour the trade unions' alternative.
During the Second Reading of the Trade Disputes Bill, Sir William Robson
William Robson, Baron Robson
William Snowdon Robson, Baron Robson PC was an English lawyer, judge and Liberal politician who sat in the House of Commons in two periods between 1885 and 1910....
noted that the Bill was intended to prevent "industrial conflict being the subject of litigation."
Assessments
George DangerfieldGeorge Dangerfield
George Dangerfield was a journalist, historian, and the literary editor of Vanity Fair from 1933 to 1935...
wrote in his The Strange Death of Liberal England
The Strange Death of Liberal England
The Strange Death of Liberal England is a book written by George Dangerfield, first published in 1935, attempting to explain the decline of the British Liberal Party in the years 1910 to 1914.-Thesis:...
:
It gave the Unions an astounding, indeed an unlimited immunity. Labour was jubilant. The most powerful Government in history had been compelled, by scarcely more than a single show of power, to yield to the just demands of organized workers.
The English constitutional theorist A. V. Dicey
A. V. Dicey
- References :...
argued that the Act conferred
upon a trade union a freedom from civil liability for the commission of even the most heinous wrong by the union or its servant, and in short confer[red] upon every trade union a privilege and protection not possessed by any other person or body of persons, whether corporate or incorporate... [this Act] makes a trade union a privileged body exempted from the ordinary law of the land. No such privileged body has ever before been deliberately created by an English Parliament.
The economist Joseph Schumpeter
Joseph Schumpeter
Joseph Alois Schumpeter was an Austrian-Hungarian-American economist and political scientist. He popularized the term "creative destruction" in economics.-Life:...
in his book Capitalism, Socialism and Democracy said of the Act:
It is difficult, at the present time, to realize how this measure must have struck people who still believed in a state and in a legal system that centered in the institution of private property. For in relaxing the law of conspiracy in respect to peaceful picketing—which practically amounted to legalization of trade-union action implying the threat of force—and in exempting trade-union funds from liability in action for damages for torts—which practically amounted to enacting that trade unions could do no wrong—this measure in fact resigned to the trade unions part of the authority of the state and granted to them a position of privilege which the formal extension of the exemption to employers' unions was powerless to affect.
It remained in force until 1971. For the centenary of the Act, the Trades Union Congress
Trades Union Congress
The Trades Union Congress is a national trade union centre, a federation of trade unions in the United Kingdom, representing the majority of trade unions...
campaigned for a Trade Union Freedom Bill.
Right to strike
The Act was one of the most significant pieces of legislation for the 20th century, and was the cornerstone of the whole country's system of collective bargaining. It was also heavily influential abroad. The right to strike is now recognised as being a "fundamental human right" by the courts. In London Underground Ltd v NUR, Millett LJ said,
"a right which was first conferred by Parliament in 1906, which has been enjoyed by trade unions ever since and which is today recognised as encompassing a fundamental human right".