Crabb and others v TUI in the Court of Appeal – Collective agreements, normative effect and the construction of carve out clauses

On 29^th July 2026, the Court of Appeal handed down judgment in Crabb and others v TUI [2026] EWCA Civ 988 – in what is now the leading modern authority on the normative effect of collective agreements.

TUI has traditionally provided its pilots with exceptionally generous PHI (permanent health insurance) rights, backed – as is often the case – by an insurance policy between TUI and a leading insurer.  Following the cost of that insurance rising significantly, TUI reached a collective agreement with BALPA (the trade union representing its pilots) to introduce a new PHI scheme (“PIP”) which substantially reduced the level of benefit to be paid.

A group of pilots employed by TUI, whose PHI benefits had been slashed by the introduction of PIP, brought claims in the High Court claiming TUI’s actions constituted a breach of their individual contracts of employment.

All of their claims at first instance were dismissed.

On appeal, the pilots’ case focussed on a particular contractual provision (section 5.1 of the TUI Handbook) which, they asserted, prevented TUI from being able to reduce their PHI rights by way of collective bargaining.

That provision stated as follows:

“Can the Plan be altered or discontinued?

 Your Company [TUI]… hope[s] to continue the [PHI] Plan indefinitely, but must necessarily reserve the right to modify, suspend or discontinue the Plan if future conditions in their opinion, warrant such action, subject to employee consultation as appropriate.  Benefit already being paid at the date of any change will continue and will therefore not be affected by any such change.”

The pilots (each of whom was already receiving PHI at the date PIP was introduced) claimed that their entitlement to PHI was an accrued right.  Moreover, they argued that the above clause prevented TUI from reducing their PHI rights by introducing PIP by way of a collective agreement and in the absence of their individual consent.

In a strong judgment, the Court of Appeal (Underhill LJ giving the leading judgment) dismissed the pilots’ appeal.  On its correct construction, section 5.1 sought to do two things:

• First, it provided TUI with a unilateral right to make changes to the provision of PHI to its pilots; and
• Secondly, the clause provided in-claim pilots with a measure of protection against such a unilateral change.

In short, the clause was simply not engaged.  TUI had not made any unilateral change to the provision of PHI.  Instead, it had entered into a bilateral agreement with BALPA.  Further, each of the pilot’s individual contracts of employment expressly stated that they incorporated any amendment to the TUI/BALPA collective agreement.

Given that section 5.1 had no effect on the efficacy of the collective agreement reached between TUI and BALPA, the effect of the incorporation terms within their contracts of employment was that PIP was lawfully introduced and, therefore, could not constitute a breach of contract.  Indeed, the change of PHI rights had been introduced using the agreed contractual mechanism.

Accordingly, the pilots appeal failed.

This case is important for a number of reasons:

1. The Court of Appeal upheld the traditional principles to be applied to the incorporation (into individual contracts of employment) of collective agreements. Front and centre of that analysis will be the terms of the individual contracts of employment;
2. This case is a salutary reminder to employees that group representation can provide significant benefits. However, where a small group of employees have rights which conflict with the interests of the wider group, collective agreements can result in those rights being eroded in the interests of the majority; and
3. The case shows that where a clause is relied upon to suggest that particular rights have been excluded from collective bargaining, the Court is entitled to expect clear language. In this matter, section 5.1 made no reference to PHI rights being excluded from collective bargaining.  The judge was entitled to find that no exclusion objectively had been agreed.

Alongside Ed Williams KC, Andrew successfully represented TUI both before the High Court and the Court of Appeal.

Read the Court of Appeal’s judgment here.

Andrew is a leading employment law practitioner.  He is listed as a “Pre-eminent” employment barrister in Doyle’s Guide.  He was also nominated for the employment law junior of the year by Legal 500 in both 2022 and 2025.