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Transposition of the SE legislation in Ireland (Updated report: October 2004)

Resulting from the historical links, Ireland operates within, what is called, a ‘voluntarist’ system of industrial relations, i.e., the right to choose to join a trade union or an employer organisation, to bargain collectively or individually and to agree or not to agree on the issues in dispute and that the disputes between the parties should be resolved without the intervention of outside forces. A fundamental principle of this voluntarism is the absence of legally imposed structures and that the State takes a supportive role, through legislation and the provision of dispute settlement arrangements, rather than an interventionist role, in the employment relationship.

Since joining the European Community in 1973, in Ireland there has been a growing interest in shifting industrial relations from the traditional adversarial approach to a more consensus way of addressing workplace problems. This was not out of character with the Irish system of industrial relations as, since 1946, there had been a series of national wage rounds and, during the 1960s, on a number of occasions agreement on a Wage Round was negotiated centrally by the ICTU and the employers’ organisations. However, these experiments never lasted longer than a single Wage Round, until 1970 when, under the threat of legislation to control incomes and prices, the employers’ organisations and trade unions negotiated the first National Wage Agreement. These agreements eventually lead to the negotiation of two tripartite National Understandings between 1979 and 1981. They covered, not just pay levels in the Public and Private Sectors, but also a wide range of national economic and social policies, such as taxation, social welfare and health, education and training, labour law, housing and a commitment from the three parties to work together to achieve significant increases in employment. These agreements were the forerunner of the present series of National Programmes, agreed between the social partners and successive Governments, which have become the basis of Irish industrial relations since 1987.

Worker Participation Policy in Ireland

With the emergence of consensus at national level in the early 1970s there was recognition of the need to supplement this with limited forms of workers' participation. In 1973 a draft agreement was drawn up, for inclusion in the third National Wage Agreement, which would provide for the establishment of works councils in Irish enterprises. While the ensuing discussion on this draft agreement accepted that the proposed approach was in keeping with the practice and traditions of Irish industrial relations it was never ratified as events, such as the first OPEC oil crisis and resulting global recession, changed the priorities of both employers and the trade unions.

The Government, therefore, took the view that if anything was to happen regarding workers' participation that it would have to provide the stimulus. Consequently, in 1977 legislation was enacted giving employees in seven State?sponsored commercial companies the right to elect a third of the directors to the boards of these organisations, for a period of three years. (Worker Participation (State Enterprises) Act, 1977)

Based, in part, on the report of the Workers’ Participation Advisory Committee the original 1977 legislation was amended in 1988. This new law extended the worker director system further and increases the term for elected directors from three to four years.

Recognising that the 1977 Act failed to provide any guidance on how worker directors should link with the workers who had elected them through some sort of reporting back process, the legislation also provides for the establishment of sub?board consultative arrangements, not just in companies and agencies with worker directors, but also in other organisations. In total thirty?six State companies and agencies were covered by this aspect of the legislation. The approach adopted in the new Act was very flexible on the type of consultative forum which should be set up within each organisation, as the structure needed to reflect the objectives of the organisation, the size and location of its workforce, the employee/management relations, its culture, its national role or the business environment in which it functioned.

As regards the Private Sector, in keeping with the 'voluntarist' nature of Irish employment relations, the Government showed a reluctance to impose any form of employee participation if it was not acceptable to employers and managers. Its preference was for the social partners to reach a voluntary agreement. However, such agreement was never reached and the introduction of EU legislation for the establishment of European Works Councils brought a new concept to the Irish labour market by introducing, for the first time, statutory information and consultation rights into Private Sector employment. An estimated 300 transnational enterprises with subsidiaries based in Ireland are covered by the Directive. Many of these have already established EWCs with members representing Irish workers at European-level meetings.

The Framework Directive to introduce information and consultation arrangements for any enterprise operating within the EU (2002/14/EC) will extent this process further and employee involvement will have been achieved through the EU route rather than domestically, something the unions have advocated for decades, but without success.

The Government launched a consultation process, with the publication of a Consultation Paper, on how this Directive should be transposed into Irish legislation and both the trade unions and employers have made submissions in response to this paper.

European Company Statute Directive

While dealing specifically with the Framework Information and Consultation Directive, the Irish Government’s Consultation Paper notes that the ECS Directive must be transposed into Irish law by 8 October, 2004. However, in its response to the paper the Irish Congress of Trade Unions (ICTU) has sought the transposition of both Directives at the same time and through a single consultation process.
Turning to the specific provisions of the Directive the ICTU made two general comments in a letter the Dept of Enterprise, Trade and Employment (which is the responsible ministry for the implementation of the two Directives):

"First, Congress noted that Article 3 of the Directive specifies arrangements for the establishment of a special negotiating body (SNB) and the arrangements for the selection of employee representatives on SNBs. The relevant subsection provides that Member States may make provisions that would permit representatives of trade unions to participate in SNBs whether or not they were employees of a participating company, concerned subsidiary or establishment. It is the view of the ICTU that the legislation transposing the Directive should provide that, if employees choose to be represented by a trade union on a SNB, the employer concerned must facilitate that union's participation.

Second, the submission argued that the standard rules set out in the annex to the ECS Directive and which will apply in certain circumstances, most notably in the event of the parties failing to agree on procedures for employee involvement by way of an SNB, should be consistent with the basic rules which may emerge from the transposition of Directive 2002/14/EC and should be reflected in the standard rules which will be specified in legislation transposing this Directive. In other words, there should be consistency and continuity across the two Directives.

Transposition of the Directive into Irish Law

It is the view of the Dept of Enterprise, Trade and Employment that this directive can be transposed through a regulation laid before the Oireachtas (Irish Parliament). However, to date this has not happened, so the deadline for transposition of the directive has not been met. The regulation is been finalised by the Department and it is hoped to have the transposition completed before the end of 2004.

Alle Ireland