IMPORTANT UPDATE: Collective Bargaining Legislation Now in Force

The Industrial Relations (Amendment) Act 2015 was signed by the President on 22 July 2015 and is in force as of 01 August 2015. This Act greatly amends the rules on collective bargaining in Ireland, reintroduces Registered Employment Agreements (REAs), introduces the new concept of Sectoral Employment Orders (SEOs), and amends the remit of the Agricultural Joint Labour Committee (JLC). What is Collective Bargaining? Collective bargaining is a form of consultation and negotiation which takes place between employers and trade unions. Collective bargaining takes place when employees of an organisation are members of a trade union and that trade union undertakes to negotiate with the employer in respect of employee terms and conditions. What was the position in Ireland? Previously in Ireland, employers were not obliged to recognise trade unions and therefore were not obliged to engage with trade unions in collective bargaining. This is due to the fact that Ireland operates a ‘voluntarist’ approach to industrial relations so that while employees have a constitutional right to form trade unions, employers had an equal constitutional right ‘not’ to recognise trade union. Accordingly, collective bargaining with trade unions could only take place in Ireland where the employer recognised the trade union as being a legitimate bargaining representative of the employees in question. So why is it such a hot topic? In 2007 Ryanair won a landmark case in the Irish Supreme Court where they managed to successfully argue that they should not be required to engage in collective bargaining with the IALPA union. However, since the Ryanair case, a series of European developments have suggested that collective bargaining should be mandatory on employers. In addition, the Lisbon Treaty and the European Convention of Human Rights, both of which Ireland are signed up to, contain very strong language on the right to collectively bargain. As a result of the Ryanair case, the IMPACT union took the matter to the International Labour Office Committee which has ultimately led to this new legislation being introduced. Changes to Collective Bargaining under the Industrial Relations (Amendment) Act 2015 The following changes have been introduced by the Act as of -01 August 2015:

• The Act introduces a legal definition for the term “collective bargaining”. This legal definition extends to “excepted bodies” which means that an employer can create internal negotiating mechanisms with employees (i.e. with no trade union involved) which will itself be deemed collective bargaining (i.e. the input of a trade union is not required for “collective bargaining” to exist.)
• Accordingly, there is still no requirement to recognise trade unions (indeed, a referendum would likely be required to oblige employers to do so).
• The Labour Court will have the power to examine the “establishment, functioning and administration” of the internal excepted body to ensure that it is independent of the employer for collective bargaining purposes. This essentially means that an employer cannot simply create an internal employee body and call it collective bargaining if in all reality the employer is dictating what the employee do and do not agree to.
• However, where an employer does not engage in collective bargaining, employees can still bring a trade dispute before the Labour Court, through their trade union. Any Labour Court decision will be legally enforceable at the Circuit Court. Therefore, even though an employer does not have to engage in collective bargaining and does not have to recognise a trade union, it is distinctly possible that the Labour Court or Circuit Court can oblige you to do so where a legitimate trade dispute exists;
• The Labour Court will not investigate any trade dispute if it only concerns an insignificant number of employees;
• The Labour Court will not entertain any trade dispute if the Court had issued a determination on another trade dispute brought by the same employees against the same employer in the previous 18 months;
• In assessing the fairness of employee terms in a trade dispute, the Labour Court will look at the all of the employees’ terms in assessing overall fairness. For example, if the rate of pay is quite low the Labour Court will not just look at this in isolation and will assess the overall benefit package the employee is receiving. The Court will also assess fairness against the industry norm in both unionised and non-unionised companies.
• If an employee is victimised by their employer for invoking a trade dispute then the employee can seek interim relief at the Circuit Court. This would essentially allow the employee to secure an injunction against their employer.

  What About REAs? In 2013, there were 73 REAs in existence, with 6 applying to entire sectors: two in the Construction Sector and one each covering Electrical Contracting, Printing, Overhead Powerline Contractors and Dublin Drapery, Footwear and Allied Trades. These REAs were found to be unconstitutional in 2013 and have not existed since then. The Act has re-introduced REAs but importantly these can only bind employers who are actually parties to the agreement. Once an REA has been drafted, the Labour Court must conduct a review of the pay and pension conditions in that sector. If satisfied that the REA is required, the Labour Court will submit its Recommendation to the Minister for approval. Once approved, the REA will be binding and enforceable. What are Sectoral Employment Orders (SEOs) SEOs are a brand new type of agreement created by the Act. Whereas REAs will only bind those persons who were a party to the REA, SEOs can bind an entire industry. An SEO can be created where a trade union or employers’ body, that is substantially representative of the industry, requests that the Labour Court conduct a review of the pay and pension and sick pay entitlements of workers in that industry. The Labour Court, having considered relevant economic factors, may recommend to the Minister that an SEO be introduced. Before the SEO can be enforced it must be approved by the Oireachtas. Therefore, any employer who was familiar with the old REAs will be aware that the new SEOs are quite similar in application to the old REAs of pre-2013. However, they are formed differently and the level of involvement from the Oireachtas is essentially the “cure” for the problems that led to the old REAs being struck down as unconstitutional. The Agricultural JLC The Agricultural JLC, like all JLCs, was struck down as unconstitutional in 2011. The Industrial Relations Act 2012 allowed for the formation of new JLCs but due to a technical issue this was not extended to the Agricultural JLC. The new Act has now cured this technicality and as of 1 August 2015 the Agricultural JLC can now reform and create Employment Regulation Orders (EROs) for the industry. However, quite importantly for those involved in the previous ERO, the new JLC will not extend to sports grounds and horse rearing which means such employers will not be bound by the JLC. The JLC can apply to companies engaged in “the sorting and packing of meat and other animal produce” so it is ubnclear if this is intended to mean meat processing companies in general as such companies would not have traditionally come under the JLC. Once this becomes clear we will notify our clients as soon as possible.   If you have any queries on the topics above then please do not hesitate to contact our 24 Hour Advice Service on 01 855 50 50 and one of our experienced Employment Consultants will be more than happy to assist.