Trade Act

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.
The immediate cause for the Act was a trilogy of cases in the House of Lords, which had for the first time imposed damages in tort on trade unions for going on strike. Previously, the legal status of trade unions was 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. A man persuaded a singer to come and perform at his show, and drop the one she had contracted for. The court held that the man would have to pay damages to the person the singer dropped for that loss. 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 unions 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.