With union recognition and strike-related flight cancellations rearing their heads in recent weeks, some will surely hark back to the days when unions were illegal and membership ran the risk of being whipped in public, all the way from Newgate Prison near Dublin’s Christ Church Cathedral up to College Green! Of course, times have changed somewhat. And in the dying days of the last Fine Gael-Labour Coalition Government, the Industrial Relations (Amendment) Act 2015 brought the contentious issue of trade unions’ ‘right to bargain’ slap bang back before practitioners, including the Labour Court.

However, to appraise this subject from the wider perspective, one could say that – when it comes to trade unions - employers in this jurisdiction have 3 basic options. That is, they can work with unions (e.g. across the public sector), they can try to edge out unions (e.g. Avis car rental, Eircom), or they can try to manage without unions (e.g. across the private sector).

Advantages of working with Unions

The main advantages for an employer opting to work with unions is that they become an integral part of the communications process, they help ‘legitimise’ the decision-making and they may well enable ‘better’ decisions. Of course, if unionisation is inevitable, it makes sense for the employer to try and shape the nature of that relationship, rather than succumbing as its victim.

Employers trying to edge out unions tend to do so in the expectation that their objectives are more likely to be achieved by removing them. This is often allied to more direct methods of employee involvement, including the relegation of industrial relations to a less important role in human resource policies and practices – or as was suggested in the TESCO-Mandate dispute earlier this year, of an employer opting to engage in a ‘deliberate and systematic attempt’ to ‘tear up the collective agreements that they freely entered’ in pursuit of de-recognition status. Notably, in pursuit of its call for statutory negotiation/recognition rights and reflecting current activity on this hot topic, Mandate drew attention to the ‘anti-union behaviour of employers such as Dunnes, Tesco, Paddy Power, Lloyds Pharmacy, IKEA, LIDL and Aldi’. The ultimate goal in many such scenarios is often to push the ‘negotiations’ process down to ‘consultation’ and thereafter to push ‘consultation’ down to ‘communication’, with an eye to eventual derecognition.

Non-Union Status

The third common category is non-union status – which is extensive across the private sector – though is coming under threat in recent times in some high profile (recognition) strikes, such as at TK Maxx retailers and Lloyds Pharmacy. Notably, in the course of a Labour Court hearing in the latter case (which recommended that the parties ‘engage’), the company explained that it had a: ‘history of progressive H.R. practices and direct engagement with colleagues’, whereas a union would ‘work against the culture which has developed over many years and restrict the company’s ability to communicate directly with colleagues.’  A fall-out from this dispute is that up to the end of July last there had been 7 strikes across Lloyds’ stores, with the Mandate union alleging that its membership therein had climbed to 270.A similar ‘direct communication’ line was taken earlier this year at TV3, in the face of a 2-hour protest by unionised staff, when the station stated that it: ‘can build a more successful TV operation through dealing directly with all our people’.

Non-union status has become a normal feature of Irish industrial relations since the 1980s. For example, in 1994 research at the University of Limerick found that more than half of the companies employing over 100 workers that had recently established greenfield operations had opted for a non-union policy, rather than agreeing a ‘pre-production’ union recognition arrangement.

Right to bargain

However, enabled by the social partnership process, in 2001 the Industrial Relations (Amendment) Act was introduced, providing for a ‘right to bargain’. Rather than a ‘right to recognition’ (as provided for in many comparable jurisdictions), this enactment gave the Labour Court statutory powers to investigate a dispute and to issue a determination in respect of ‘the totality of remuneration and conditions of employment’. Under the enactment, the ‘punch line’ was that should a decision from the Court fail to be implemented by the employer, the final recourse for the union was to secure enforcement via the Circuit Court.

However, to the relief of many employers, just as this enactment was getting into ‘full swing’, the Supreme Court allowed an appeal by Ryanair against a High Court Order upholding a decision of the Labour Court made under the aforementioned Act (and the Industrial Relations (Miscellaneous Provisions) Act, 2004). The effect of the Supreme Court’s judgement was to squash the original decision of the Labour Court and to remit the matter back to it for a rehearing. In reality, the effect was to make the new ‘right to bargain’ legislation redundant. As far as the Supreme Court’s judgement was concerned, the nub of the matter was that the Labour Court should have investigated whether there was an internal process within Ryanair to resolve the problem and whether that process had been exhausted. Related thereto, the Supreme Court refused to accept that simply because employees abandoned an internal collective bargaining process, that this meant that there was no collective bargaining process.

Thereafter, in pursuit of recognition claims, trade unions relied upon Section 20(1) of the 1969 Industrial Relations Act. However, under this Act, the Court’s decision is only binding on the union taking the case, alas crucially, it is not binding on the employer who is the subject of the claim.

Valid trade disputes with non-unionised employers

Fast forward to 2015, when the Industrial Relations (Amendment) Act was introduced, heralded as a major development, with significant capacity to change the industrial relations dynamic for non-union employers. The practical upshot of this development is that trade unions can now refer valid trade disputes with non-unionised employers to the Labour Court for adjudication (via the Industrial Relations Act 2001-15). This is exactly what the Services, Industrial, Professional and Technical Union (S.I.P.T.U.) did in 2016, when seeking a binding Labour Court decision in the Freshway Foods dispute. This case offers a notable benchmark in terms of the requisite number of employees that need to be in union membership for a case to proceed. At the Freshway Food Co., of the 250 employees, 170 were described as ‘general operatives’, of whom 63 were S.I.P.T.U. members, prompting the Court to conclude that the number in dispute ‘is not insignificant relative to the total number of general operatives employed by the employer’.

Just last year, the Communications Workers’ Union (C.W.U.) followed suit, taking a case under the same enactment, against the non-union company Conduit Enterprises (now known as the Emergency Call Answering Service (E.C.A.S.)). Both cases caused some controversy in respect of how the Court used ‘comparator firms’ in their analysis. That is, the Court admitted evidence in respect of organisations with employees doing ‘comparable work’, thus prompting the Irish Business and Employers’ Confederation (I.B.E.C.) to complain that (in the Freshway’s case) the pay increases recommended were ‘totally out of line with market increases’. Notably, the Court pointed out that in its choice of comparators, the Act’s guidance in relation to the type of work performed was heeded. In the E.C.A.S. case eyebrows were raised when the Labour Court factored in (the competency skill-set of) public sector comparators as proposed by the C.W.U. (i.e. Health Service Executive call takers, Gardai emergency call takers and local authority Fire Service call takers). Explaining its stance, the Court pointed out that it was not entitled to conclude that:

‘ .. the legislation is to be interpreted in such a way as to mean that it is inoperative in all circumstances where the disputing workers are employed in the private sector and the comparator employment is a public sector employment.’

Of course, there is a real fear that – like in the aforementioned Ryanair saga – the Supreme Court will eventually adjudicate on the new (2015) enactment, serving to make it redundant (like its 2001 predecessor). Fears of this nature surfaced in a recent Dunnes Stores-Mandate dispute, when rumours of a ‘judicial review’ surfaced. This is a very real fear on the union side and probably explains its caution in the relatively modest number of claims that have been processed to date under the amending legislation. It is also a factor in the Irish Congress of Trade Unions’ (I.C.T.U.) Private Sector Committee’s exploration of a host of other routes toward trade union recognition rights. These include a constitutional amendment, a test case at the Court of Justice of the European Union, election lobbying, more extensive use of Sectoral Employment Orders and Public Procurement obligations.

For employers opting to argue that they already have a collective bargaining system in place – hence meeting the Act’s ‘excepted body’ status - it is evident (from the Freshway’s case) that this ‘system’ needs to be a repeated pattern, as opposed to a ‘one off’ occurrence. In this regard, attention will be paid to the ‘excepted body’s’ composition and whether it actually engages in ‘negotiation’ rather than serving as some form of ‘consultation’ or ‘communications’ forum. Notably, the onus of proof rests with the employer in such scenarios.

On a separate point, the Freshway’s case also created a mini-storm (with potentially far reaching consequences), when it alluded to the Code of Practice on Grievance and Disciplinary Procedures (Statutory Instrument No. 146 of 2000), recommending that:

 ‘the employer should provide for trade union representation in processing individual grievances and disciplinary matters, where an employee wishes to avail of such representation’

According to Brian Sheehan’s extensive and expert analysis at the Industrial Relations News, amongst the key lessons to emerge from the amending 2015 enactment – based upon the 4 cases that have been processed since its introduction – are:

(i)            The union membership level required to secure a hearing. Notably, in 1 of the 4 cases (i.e. Zimmer Orthopaedics v S.I.P.T.U.), it was held that the union failed to meet the requisite level).

(ii)          The ‘collective bargaining’ test (i.e. does the employer already ‘negotiate’ with what may be classified as an ‘excepted body’ – see above).

(iii)         The issue of appropriate ‘comparators’, when assessing the relative merits of a claim (n.b. such comparators don’t need to be ‘identical’, just ‘comparable’ - to be in similar employment to those relied upon as comparators). Notably, the Labour Court held in the Enercon and Connect trade union case (taken under the same legislation), that it didn’t have ‘sufficient information or evidence’ enabling it to conclude on the comparability of the nominated employers and roles (where considerations such as comparable skills, responsibilities, physical and mental efforts feature).

Stability agreements

Of course, one of the more practical by-products of the changing terrain has been the emergence of ‘stability agreements’ with their ‘Orderly Dispute Resolution Framework’ (O.D.R.F.) in the pharmaceutical, chemical and medical devices sector. For example, last year, when GE Healthcare was facing the prospect of a ‘right to bargain’ claim, it secured an arrangement with S.I.P.T.U. for a new joint forum with an independent mediator and O.D.R.F. process, with an all-important series of safety nets or layers designed to ensure that any industrial dispute could be resolved before becoming consequentially injurious.

Well whatever about such ‘stability agreements’ and orderly dispute resolution frameworks, recent developments in the ‘right to bargain’ area have prompted I.B.E.C. to warn that ‘the current drive by the trade union movement to remove Ireland’s voluntarist approach to industrial relations’ runs counter to the objective of making Ireland ‘the best small country in the world in which to do business’, with implications for foreign direct investment, that now faces ‘a real existential threat in terms of their continued operation in Ireland’.

It looks like this subject is going to run and run … with far-reaching consequences for many.

NOTE: DR. Gerry McMahon will deliver Legal-Island's Successful Negotiating Skills: Getting to Yes workshop on 20th September 2018 at the Radisson Blu Hotel, Dublin Airport. Learn more.