Employment Act 1988

8 Use of funds for indemnifying unlawful conduct. E+W+S

(1) It shall be unlawful for any of the property of a trade union to be applied—

(a) in or towards the payment for any individual, or securing the payment for any individual, of any penalty which has been or may be imposed on him for a relevant offence or for contempt of court; or

(b) in or towards the provision of anything for indemnifying any individual in respect of any penalty which has been or may be imposed on him for any such offence or for contempt of court.

(2) Where any property of a trade union is applied in contravention of subsection (1) above for the benefit of a particular individual on whom a penalty has been or may be imposed—

(a) in the case of a payment, an amount equal to the amount of the payment shall be recoverable by the union from that individual; and

(b) in the case of an application of property otherwise than by the making of a payment, that individual shall be liable to account to the union for the value of the property.

(3) A member of a trade union who claims that a failure by that union to bring or continue any proceedings by virtue of subsection (2) above is unreasonable may apply to the court for an authorisation under this subsection; and where, on such an application, the court is satisfied that the failure is unreasonable, the court may make an order authorising the applicant to bring or continue the proceedings on the union’s behalf and at the union’s expense.

(4) In this section—

• “penalty”, in relation to a relevant offence, includes an order to pay compensation and an order for the forfeiture of any property, and references to the imposition of a penalty for an offence shall be construed accordingly;

• “relevant offence” means any offence other than an offence for the time being designated by order made by the Secretary of State as an offence in relation to which this section does not apply.

(5) The power of the Secretary of State to make an order under subsection (4) above designating any offence shall be exercisable by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament.

(6) Subsection (1) above shall be without prejudice to any enactment, rule of law or provision of the rules of a trade union which, apart from this section, makes it unlawful for the property of a trade union to be applied in a particular way; and subsections (2) and (3) above shall be without prejudice to any remedy available otherwise than under this section to a trade union, the trustees of its property or any of its members in respect of any unlawful application of the union’s property.