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IR Bill delivers on key commitments to improve working conditions

SPEECH BY GED NASH TD Minister for Business and Employment


Dáil Éireann, Industrial Relations (Amendment) Bill 2015, Second Stage

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I move: “That the Bill be now read a Second Time.”

I am pleased to introduce the Industrial Relations (Amendment) Bill 2015 for the consideration of the House. For several years now there have been gaps in the statutory framework as regards workers who seek to better their terms and conditions, either through collective bargaining or by means of registered employment agreements. 

These gaps arose after the Supreme Court struck down the old REA framework on constitutional grounds, having at an earlier stage found serious fault with the collective bargaining legislation. 

This Bill is a direct response to these rulings. It represents delivery on two key commitments and it is a Bill I am very proud to have progressed. I entered public life 16 years ago in order to improve people’s living and working conditions. I believe this new legislation can help to do exactly that.

The legislation has two purposes. Firstly, it will provide for the reintroduction of the registration of employment agreements between employers and trade unions in individual enterprises and for a new framework to replace the former, sectoral, Registered Employment Agreements. 

Secondly, the Bill will put in place the legislative amendments required to give effect to the Programme for Government commitment to reform the Industrial Relations Acts 2001 and 2004, dealing with collective bargaining.

Before moving to detail the various sections of the Bill I would like to give Members an overview of what the Bill achieves.

Part 2 of the Bill provides for the registration of employment agreements between employers and trade unions governing remuneration and conditions of employment in individual enterprises. The content of these agreements will be a matter for the contracting parties and they will be legally binding on those parties.

Part 2 also provides for the making of a new type of Ministerial Order, the Sectoral Employment Order, or SEO. The Labour Court will be entitled to initiate a review of the pay and pension and sick pay entitlements of workers of a particular class, type or group in a particular sector and to then make a recommendation to the Minister. Such a review can be initiated at the request, separately or jointly, of organisations substantially representative of employers and/or of workers. 

Where the Minister is satisfied that the process provided for in the new legislation has been complied with by the Labour Court, he or she shall make the order. Where such an order is made, it will be binding as regards all members of the class, type or group of worker in the sector to which it relates, and it will be fully enforceable. 

There is broad acceptance that the re-introduction of REAs and a sectoral pay and conditions framework in a constitutionally robust manner will benefit both workers and their employers. From a worker and employer perspective, these agreements and orders will provide certainty around what pay and conditions will be into the future – and they will provide also the very real pay-off of industrial peace. 

These are critical considerations, both for workers planning their future and for employers when tendering for and working through contracts. They will also maintain skill standards and help avoid the race to the bottom that, in the end, is of no lasting benefit to either employers or workers. 

In that regard, we all note the considerable importance that employees in Aer Lingus have attached to securing a new and comprehensive set of registered employment agreements to underpin their continued employment there under new owners. I am pleased to have played a role in securing a meeting of minds between workers and management on the way forward for employment at Aer Lingus and of course I hope this Bill can be expedited through the Houses in sufficient time to enable its provisions to be made use of by those parties. 

While there can be no REA at Aer Lingus unless and until this legislation is passed, there is of course nothing to prevent management and unions from starting their negotiations on a new employment agreement right now, with a view to having it registered as soon as the Bill becomes law.

In due course, I would imagine that Dublin Bus and Bus Éireann may well become engaged in a similar process. 

In all these cases I would stress, however, that, while Government policy is to support enterprise level agreements, believing they are mutually beneficial and that they safeguard the interest of employer and workers, they are in their essence voluntary agreements, negotiated between a business and its workforce, through their unions. The content has to be settled between the parties themselves and is not imposed by Government.

I move on to Part 3 of the Bill, which I believe fulfils a significant commitment in the Programme for Government – to make sure that Irish law is consistent with recent judgments of the European Court of Human Rights. 

It will provide a clear and balanced mechanism by which the fairness of the employment conditions of workers in their totality can be assessed where there is no collective bargaining in the workplace.

It will ensure that workers, aided by a trade union, can advance claims about remuneration and conditions of employment and can have these decided by the Labour Court, based on comparisons with similar companies. 

This Part of the Bill provides guidelines to help the Labour Court identify the genuine independence of internal bargaining bodies and sets out policies and principles for the Labour Court to follow when assessing the comparability of the remuneration and conditions in dispute.

I know that workers may feel exposed when seeking to improve their terms and conditions. Simply making themselves known may have unwanted and unwarranted consequences. The legislation will therefore provide significant protection against such consequences. This will be available by way of interim relief in the Circuit Court to a worker who challenges a dismissal on the basis that he or she was victimised as a result of invoking the process under the Act. 

I want to conclude this short overview by acknowledging that both the trade unions and employer organisations played a critical role in assisting to develop this clear and workable framework and that representatives of both sides of industry made a huge contribution. 

In summary, the re-introduction of REAs in a constitutionally robust manner will provide certainty around what pay and conditions will be into the future. In addition, I have no doubt but that REAs and SEOs will assist in resolving industrial disputes or potential disputes and will promote industrial peace. And a balanced mechanism for determining terms and conditions where there is no collective bargaining provides a statutory remedy against workplace exploitation.

This Bill is described in its long title as “An Act to make further and better provision for promoting harmonious relations between workers and employers”. Industrial relations harmony is one of the principal objectives of our industrial relations legislation. I have made repeated statements about the ongoing dispute in Dunnes Stores. I have said I am disappointed that the company decided against attending Labour Court hearings, contrary to good industrial relations practice. And I have called on both sides to engage and to use the professional expertise of our workplace relations institutions to assist them in resolving the dispute. 

I call again on the company to engage in a meaningful fashion with the Mandate trade union. If there is no willingness to do so now, it may well be that passage of this legislation will sufficiently alter the circumstances to persuade the company of the merits of doing so in the very near future. In my view, the experience and expertise of the Labour Court offers the most appropriate and effective avenue for resolving the issues at stake in that dispute. 

Taken together with the National Minimum Wage (Low Pay Commission) Bill that is at present before the Seanad, I believe that the next few weeks represent a unique opportunity for the Oireachtas to bring about the most significant shift in the industrial relations landscape seen in many years. 

I will now outline in detail the provisions of the Bill. Part 1 of the Bill deals with the short title, citation and interpretation provisions and commencement date. It also provides for standard provisions on expenses incurred in the administration of the Act.

Part 2 deals with Registered Employment Agreements and Sectoral Employment Orders. Chapter 1 deals with the definitions for this Part, while Chapter 2 deals with REAs at individual enterprise level.

Section 5 defines key terms to be used throughout Chapter 2 including “parties to the agreement”, “employment agreement” and “trade dispute”.

Section 6 provides for a Register of Employment Agreements to be maintained by the Labour Court; it requires the details of REA registration, cancellation and variation are to be published on the internet.

Section 7 provides that, where an application is made to register an employment agreement, the Court shall register it only where satisfied that there is all-party agreement that it should be registered, and where it is satisfied that it is desirable or expedient to have a separate agreement for the class, type or group of workers covered by the agreement. 

Similarly, the Court shall only register the agreement where it is satisfied that the trade union or trade unions is or are substantially representative of the workers. 

To be registered, every agreement must also provide that, if a trade dispute occurs between the relevant workers and their employer, there shall be neither industrial action nor lock-out until the dispute has been submitted for settlement by negotiation, in the manner specified in the agreement. 

In addition, the Court shall not register an agreement unless it is satisfied that registration is likely to promote harmonious relations between workers and their employer and the avoidance of industrial unrest.

Importantly, an REA may not prejudice any rights as to rates of remuneration or conditions of employment conferred on any worker by or under this or any other Act.

Section 8 provides for the variation of REAs. This may arise where all parties so agree, or where one party wishes to vary the agreement but the other does not. In the latter case, the Court, after the exhaustion of the agreed dispute provisions, may refuse or grant an appropriate variation.

Provision is made for a party to withdraw from an agreement following variation, where the agreement provides for a party to do so.

Section 9 provides that the Court may cancel the registration of an employment agreement at the request of all parties, or on the application of any party where the registration of an employment agreement has continued after the finishing date, and consented to by all parties. It may also cancel the registration where it is satisfied that a trade union is no longer substantially representative of the workers concerned.

Section 10 provides for the terms of an REA in respect of remuneration and conditions of employment to be incorporated into a worker’s contract of employment.

Section 11 provides that the Labour Court may, where asked, decide a question as to the interpretation of an REA or its application. In addition a court of law, in determining any question arising in proceedings before it on this point shall have regard to any decision of the Court on the agreement or may, if it thinks proper, refer the question to the Labour Court for its decision.

Chapter 3 deals with the new mechanism for Sectoral Employment Orders. These will encompass remuneration, pension schemes and sick pay schemes, or a combination of any or all three.

Section 13 provides that a trade union or an organisation of employers which is substantially representative of workers or employers of a particular class, type or group in a particular economic sector may, separately or jointly, request the Labour Court to examine the terms and conditions relating to remuneration, or sick pay, or pensions and may request the Court to make a recommendation to the Minister. 

The Court may not consider a request where the Minister has made an employment order for the same workers in that sector in the previous 12 months, unless there are exceptional and compelling reasons.

Section 14 provides that the Labour Court shall not undertake an examination unless it is satisfied that the trade union or organisation of employers is substantially representative; in so satisfying itself, the Court will take into account the number of workers represented by the trade union and the number of workers employed in the sector by employers represented by the organisation concerned.

Section 14 also provides that the Court will have to be satisfied that it is normal and desirable practice to have separate rates of remuneration and sick pay and/or pension provisions for the class, type or group of worker concerned and that any recommendation is likely to promote harmonious relations.

Section 15 provides guidance to the Labour Court on the principles and policies that it must take into account before making a recommendation to the Minister. These include the requirement to ensure that the recommendation would promote harmonious relations, promote and preserve high standards of training and qualifications and ensure fair and sustainable rates of remuneration in the sector.

Section 15 also provides that the recommendation by the Court may provide for:-

· a minimum hourly rate of pay in excess of the National Minimum Wage;

· not more than 2 higher hourly rates of basic pay, based on length of service in the sector or enterprise concerned or the attainment of recognised standards or skills in the sector concerned; and 

· minimum rates of pay in respect of young workers as provided for, and in accordance with, the relevant percentages set out in the National Minimum Wage Act.

The recommendation may also include a minimum rate of remuneration for apprentices, and for pay in excess of basic pay in respect of shift work, piece work, overtime, unsocial hours, Sundays and travelling time. Recommendations in this respect are at the discretion of the Court.

A recommendation will include procedures to apply in case of a dispute concerning the terms of a sectoral employment order.

Section 16 provides for the submission by the Labour Court to, and consideration by, the Minister of the Labour Court recommendation. The Minister must refuse to make an Order if not satisfied that the process has been complied with; otherwise the Minister must make the Order. Standard provisions dealing with the laying of orders before the Oireachtas are proposed. However, I am considering whether this should be amended to a positive resolution and will come back to this matter at Committee Stage.

Section 17 provides that if an Order has not been amended or revoked within 3 years, the Minister may request the Court to undertake a review of the terms and conditions of the previous Order.

Section 18 provides that an SEO shall apply to all workers of the class, type or group in the relevant sector, regardless of whether the worker and his or her employer were party to the request to the Labour Court, and provides for the incorporation of the terms of any SEO in a worker’s contract of employment.

Section 19 provides for anti-penalisation measures to protect a worker who invokes any right conferred on him or her by the Act or who takes other specified actions under the Act.

Section 20 provides a mechanism to allow an employer experiencing financial difficulties to apply to the Labour Court for a temporary derogation from the requirement to pay the remuneration stipulated by an order. 

I move on to Part 3, which addresses the Government’s commitment on collective bargaining. Section 23 amends the Industrial Relations (Amendment) Act 2001 – the “Principal Act” – by inserting definitions in relation to “collective bargaining” and “excepted body”. 

Section 24 amends the Principal Act to remove the right of access of what are called “excepted bodies” to these procedures. I should explain that “excepted body” is the term used in the Trade Union Acts to describe a body such as an in-house works committee or the like, that is not a registered trade union and that conducts negotiations on pay and conditions only for the staff of one employer. 

Since the decision of the Supreme Court in Iarnród Éireann v Holbrooke, it is now clear that a body cannot be an excepted body within the meaning of the Trade Union Act 1941 unless it actually conducts consensual negotiations with an employer. So, if there is a genuine excepted body in operation, that means that there is genuine collective bargaining going on. 

Since this legislation is only about providing a remedy where there is no collective bargaining, a fundamental prerequisite for invoking this Act must be the absence of collective bargaining negotiations. That prerequisite cannot be satisfied where there is a genuinely functioning excepted body.

Section 24 also amends the Principal Act to provide additional matters that the Court must consider in determining, before embarking on a full investigation, whether an employer engages in collective bargaining with his or her workers. 

I recognise that the procedures under this legislation wouldn’t be appropriate to disputes involving an insignificant number of workers. So, new provisions are added to the Principal Act which balance the need to avoid the possible creation of artificial grades, groups or categories, to subvert the intention of the Act, with the need to avoid erecting barriers to access for all reasonable cases. 

To achieve this, the Principal Act now provides that the Court shall decline to conduct an investigation of a trade dispute where it is satisfied that the number of workers party to the dispute is such as to be insignificant in relation to the grade, group or category of workers concerned, or any larger related grade, group or category of workers, unless there are exceptional and compelling reasons that justify an investigation. 

Section 24 also amends the Principal Act to ensure that the same or a different trade union cannot repeat the process if the Court has made a recommendation or determination for the same workers in the previous 18 months.

Section 24 inserts a new subsection into the Principal Act to give practical effect to the principle of the independence of an “excepted body”. It gives guidance to the Labour Court as to the criteria it should take into account in determining whether an excepted body is engaged in collective bargaining and is genuinely independent of the employer.

Section 24 amends the Principal Act by providing that where an employer asserts to the Labour Court that it is his or her practice to engage in collective bargaining with an excepted body in respect of the workers concerned, it will be for the employer to satisfy the Labour Court on this. 

Section 25 inserts a new section into the Principal Act to provide for supplemental matters relating to members of the trade union employed by the employer. 

The Government has decided, as a matter of policy, that it would be preferable for the workers involved in a dispute under this Act not to be required to make themselves known to their employer early in the process if possible, so as to avoid any potential for victimisation. The new section provides that a statutory declaration made by the chief officer of the trade union concerned, setting out the number of its members and period of membership in the grade, group, or category to which the trade dispute refers and who are party to the trade dispute, shall be admissible in evidence without further proof unless the contrary is shown.

However, where the employer asks that the matters specified in the declaration be examined, the Labour Court shall satisfy itself that these are indeed correct.

Section 26 amends the Principal Act to substitute the term “terms and conditions of employment” with “the totality of remuneration and conditions of employment”. This is required to ensure that the totality of pay and conditions is examined by the Labour Court.

Section 26 makes provision in the Principal Act to the effect that the Labour Court shall not make a recommendation unless it is satisfied that the totality of remuneration and conditions of employment of the workers concerned provides a lesser benefit to those workers than the totality of remuneration and conditions of employment of comparable workers employed in similar employments.

This provision is required as the Principal Act, as it stands, provides no guidance to the Labour Court on the factors that should be taken into account in formulating a recommendation or determination under the Act. 

Section 26 provides new guidance to the Labour Court, in considering whether to make a recommendation, as to the procedures to follow in its assessment. The Court is required to have regard to (a) the totality of the remuneration and conditions of employment of comparable workers employed in similar employments – whether those comparable workers are represented by a trade union or not – and (b) the comparability of skills, responsibilities, physical and mental effort required to perform the work in which the workers are engaged. In this regard, the Court may have regard to those of similar employments of an associated employer outside the State.

In addition, the amendment provides that where collective agreements concerning the relevant worker are commonplace in similar employments, the Court shall, in addition to other evidence presented by the parties, have due regard to the terms of such agreements for the time being in force. Where collective agreements concerning the relevant workers are not commonplace in similar employments, the Court shall have due regard to all evidence presented by the parties whether by way of collective agreements or established by other means.

Finally, the amendment provides that the Court shall, for the purpose of making a recommendation, have regard to the effect a recommendation may have on the maintenance of employment and the sustainability of the business in the long-term.

Section 30 amends the Principal Act by inserting a new section to provide interim relief pending the determination of a claim for unfair dismissal arising from a member of the trade union having provided evidence or information or assistance under the Act. The appropriate amendment to section 6 of the Unfair Dismissals Act, 1977 is provided in Section 35 by adding an additional ground on which a dismissal is deemed an unfair dismissal.

The terms “worker” and “employee” are given the same meaning, to ensure consistency between the two Acts.

The remainder of the Bill is concerned with what are essentially consequential amendments and are detailed in the explanatory memorandum.

I look forward to the contributions from all sections of the House on this Bill and I hope to respond in details to the views expressed. 

I believe the Bill, in its totality, represents a significant step forward for workers and employers. It provides a clear, workable and constitutionally robust framework within which workers’ remuneration and conditions of employment can be discussed and determined. 

I am confident that this framework will fit Ireland’s constitutional, social and economic traditions and its international obligations and, very importantly, will ensure continued success in creating jobs and attracting investment into the economy.

I commend the Bill to the House.