The judgment of the High Court in this case garnered significant publicity and commentary. In fact it also led to amendments to the employment permits legislation. As will be recalled in Hussein, Mr Justice Hogan, very reluctantly, quashed decisions of the Labour Court that awarded an employee back pay pursuant to the National Minimum Wage Act 2000 and compensation for breaches of the Organisation of Working Time Act 1997.

The basis for the quashing of the Labour Court determinations was the illegality of the contract of employment of the employee who did not have a valid work permit in place at the time the breaches of the legislation occurred.

As a result of the High Court judgment, the Department of Jobs, Enterprise and Innovation examined the issues identified in the judgment. In order to deal with the deficiencies in the 2006 Act the Employment Permits (Amendment) Act 2014 now provides a defence to a foreign national in criminal proceedings under the Employment Permits Act 2006 Act where he or she can show that they took all reasonable steps to ensure compliance with the obligation to hold a valid work permit when in employment in Ireland.

This is similar to the defence provided to employers in the 2006 Act. In an clear attempt to deal with the injustice caused by the Hussein judgment, the Act allows for a foreign national, employed without a valid work permit, to take a civil action for compensation for work done or services rendered, notwithstanding any illegality of the contract of employment.

This compensation is calculated by a court by reference to the national minimum hourly rate of pay or any other rate of pay which is fixed under, or pursuant to, any enactment. This potential compensation arises in addition to the potential criminal conviction of the employer.

However it is not clear if this provision applies to claims under the Unfair Dismissals Acts. Arguably if an employee has made an attempt to ensure they have a work permit in place, this would not be an illegal contract as reliance on the provision in the 2014 Act could be relied upon.

Following on from the 2014 Act, the judgment of the High Court was appealed to the Supreme Court and judgment was delivered in June 2015. The decision of the High Court was set aside, not on any explicit repudiation of the High Court’s analysis of employment law, employment contracts and irregular migrant workers, but on the basis of strict adherence to the role of a court in judicial review proceedings.

Rather than focus on the human rights arguments pleaded before it, the Supreme Court simply considered the jurisdiction of the High Court to make its August 2012 decision. The Supreme Court noted that the enforcement of the Rights Commissioners’ determinations by the Labour Court under the Organisation of Working Time Act 1997 and National Minimum Wage Act 2000 was established on objective evidence of a decision and determination and non payment by the employer.

On that basis as there was no discretion provided to the Labour Court and the powers were properly exercised by the Labour Court then no basis arose for setting aside the decisions of the Labour Court by way of judicial review. The Supreme Court effectively acknowledged that if the Labour Court enforcement decisions were subject to judicial review, this would allow the applicant to impugn the Rights Commissioner decision which it had not done within the required time limits.

Significantly the Supreme Court strongly suggested that the issue of employment rights in the context of the alleged illegal contracts required a re-assessment and indicated that it may be only the most extreme of circumstances it could arise:

"With so many regulatory measures in the modern economy concerning employment relationships and the supply of goods and services, the circumstances in which a contractual relationship which gives rise to some form of illegality might be considered a ground for not enforcing it, is a complex one.

Traditional judicial dicta, in the older cases in particular, may have to be reviewed or nuanced in the light of the modern regulatory environment, and applied with the principle of proportionality in mind. Since any issue of illegality concerning the employment relationship between the relevant parties in this case does not arise within the proper parameters of this judicial review, it is not necessary to address those issues (or other contingent issues) in any way.

I would, however, add, even though it is entirely hypothetical, that if the subject matter of the liability to be enforced involved something which was inherently immoral or inherently against the public interests, such as an agreement to rob or to distribute the proceeds of a robbery, then the issue of illegality and public policy would arise from a different perspective.

Obviously, that is not the case and unlikely to be the kind of thing which would be attributed to a Rights Commissioner by statute to decide. In this case one is dealing with an inherently lawful subject matter, namely, the relationship of employer and employee, a relationship which the Rights Commissioner, in his Determination, found to exist and give rise to a liability of the applicant. Again, there was no appeal or judicial review of that decision."

This suggestion of exceptional circumstances in which contracts of employment will be found to be illegal is different to the approach adopted in England and Wales. In a recent judgment Hounga v Allen [2014] UKSC 14, the Supreme Court of England and Wales allowed a claim to proceed on the basis that there was no inextricable link with the claim of the employee and her illegal conduct as the illegal employment contract was no more than the context in which the alleged discrimination was perpetrated.

http://www.bailii.org/ie/cases/IESC/2015/S58.html