by Breda O'Malley February-12-2016 in Employment Law
In practical terms, the Industrial Relations (Amendment) Act 2015 (the 2015 Act) could see a strengthening of the role of in-house employee forums as employers seek an exemption from the collective bargaining provisions of the new legislation.
The 2015 Act sets out a definition of collective bargaining and mandates new parameters for the referral of a trade dispute to the Labour Court. Collective bargaining is the process of negotiation of wages and other conditions of employment by an organised body of employees, generally by a trade union on their behalf with their employer.
Post-Ryanair changes
Under prior legislation – the Industrial Relations (Amendment) Acts 2001 to 2004 – the Labour Court was allowed to make legally binding determinations about referring employees’ terms and conditions of employment, where employers did not engage in a collective bargaining process with their staff.
However, from a trade union perspective, the legislation was rendered largely inoperable by the impact of the Supreme Court ruling in the 2007 Ryanair case. Ryanair suggested that employers who negotiated with in-house employee groups, even though they were not unionised, were excluded from the rigour of the Acts. Once these non-unionised organisations engaged with employers, those employers were not subject to the legally binding determinations of the Labour Court with regard to their staff terms and conditions. As a result, the number of applications brought under the prior legislation fell away dramatically, effectively negating this particular threat to non-unionised employers.
The 2015 Act and excepted bodies
The 2015 legislation broadens the circumstances in which workers can refer a trade dispute to the Labour Court for a legally binding determination against their employer, in relation to their terms and conditions. Before the Labour Court can intervene in such cases, it must be established that it is not the practice of the employer to engage in collective bargaining in respect of the workers who are party to the dispute.
The 2015 Act defines collective bargaining as “voluntary engagements or negotiations between any employer … and a trade union … with the object of reaching agreement regarding working conditions or terms of employment”. The object of the engagement must be to reach agreement between the employer and employees, in relation to terms and conditions of employment.
Even if there is no trade union, there can be an excepted body involved in negotiations instead of a trade union. An excepted body is defined as a body that is independent and not under the domination and control of an employer where all the members of the body are employed by the same employer and where it carries on engagements or negotiations with the employer with the object of reaching agreement regarding wages, or other conditions of employment, of its own members, but not for any other employees in other workplaces.
The 2015 Act narrows the grounds under which an Employee Works Council can be considered to be an excepted body.
The employer must show that the internal employee forum with which it negotiates is genuinely an excepted body. The 2015 Act sets down criteria that the Labour Court must have regard to in making a decision on what constitutes an excepted body:
• The manner of election of employees to the employee body
• The frequency of elections
• The financing or resourcing of the body cannot exceed “minimum logistical support”
• The length of time the excepted body has been in being and any prior collective bargaining between the excepted body and the employer.
An excepted body must be genuinely independent of the employer in the sense that one is not controlled by the other. Where an employer asserts that they have engaged in collective bargaining with an excepted body, allowing them to defeat an application for staff for a legally binding determination in relation to terms and conditions to the Labour Court, it is for the Labour Court to determine that negotiations of that nature in fact took place. The employer will be exempt from the provisions of the 2015 Act where the employer is found to engage in collective bargaining with the excepted body (or trade union).
Power of the Labour Court to change terms and conditions of employment
The Labour Court has wide discretion in terms of the aspects of worker terms and conditions of employment that can be examined. It can look to comparators, both unionised and non-unionised, when evaluating workers’ terms and conditions. The Labour Court can also take into account the rate of pay and conditions of employment of an “associated employer outside the State” in addition to looking at the terms of any collective agreements in place in similar employments.
The Labour Court must have regard to the effect of any such legally binding recommendation it may make on maintaining employment and the long-term sustainability of the business.
Non-Unionised employers and employee works councils
Employers in unionised workplaces will not be impacted by the collective bargaining provisions of the 2015 Act. For non-unionised employers, putting in place independent in-house employee forums, or real, meaningful engagement with existing forums, will be required to stave off referral of disputes to the Labour Court and potential imposition of terms and conditions by that body. This in turn can only serve to bolster the effectiveness of such internal bodies in representing the rights of workers.
The legislation may by extension strengthen the reach of trade unions in non-unionised workplaces, in that an employer will have to accept the binding determination of the Labour Court in any case brought by a trade union on behalf of a member employee where collective bargaining is not in place.
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About the Author
Breda O'Malley
Breda practises in both Employment and Commercial Law and is Partner and Head of the Employment Law team at Hayes solicitors. Breda has trained and qualified as a mediator with the UK based, internationally renowned Centre for Effective Dispute Resolution (CEDR). Breda practices as a mediator of commercial, employment, boardroom, charity trustee and shareholder disputes.