Collective agreements may be negotiated between employers and employees or between groups of employers and employees. They may be negotiated either directly, or more commonly through their representatives, such as unions. They are common in many sectors of industry.
Collective agreements may deal with industrial relations procedures and provide conflict resolution processes, in order to avoid strikes and lockouts. They may provide the machinery for dealing with disputes about matters arising in the course of employment or the negotiation of key terms and conditions.
Collective agreements may provide and set out some of the actual terms and conditions of employment for employees within their scope. This is subject to their incorporation in the employment contract with the express or implies consent of the employee.
Questions may arise as to whether individual terms of employment contract incorporate the terms of collective agreements. Although collective agreements are usually not intended to be legally binding, there are some circumstances in which they deal specifically with terms of employment so that the context is such that it is clear they are intended to have legal effect.
Alternative to Statutory Minimum Rights
Some legislation contemplates that collective agreements may supplement or substitute particular rules and procedures, to the default rules that would otherwise apply. Under the Organisation of Working Time Act, certain matters may be agreed in collective agreements which substitute for the default provisions in the legislation. Generally, the Labour Court must approve the agreement, having consulted with representatives of employees and employer.
Variations to the Minimum Wage Acts may be sanctioned by the Labour Court for up to 3 months, provided that there is an agreement between the employer and the majority of the employees. The matter may be agreed under a collective agreement.
Health safety and welfare legislation contemplates joint health and safety arrangements, which may be approved by the HSA. Where the agreements are in place, account is taken of them in determining compliance with health safety and welfare at work obligations.
The Industrial Relations Act provides for registered employment agreements. Once approved by the Labour Court and registered, they may apply to all employees within its scope even if they are not represented. The Legislation has been recently revised following a legal challenge to the earlier legislation. They are dealt with in detail in another article.
There are a handful of registered employment agreements only. The REA must be in a form and in terms which are compatible with the legislation. It must be negotiated by parties who are representative of employers and employees. It must provide for the resolution of disputes by negotiation, before any strike or lockout may occur. It may not impose unduly restrictive practices on employment generally, or in a particular workplace.
A draft agreement is published by the Labour Court prior to registration. Objections may be heard from any person affected. Once registered, employees within its scope, who may be designated by class, type or grade, will be bound by it. In this case, the incorporation of the relevant terms and conditions in the individual employment contract is automatic.
National Agreements I
Between 1987 and 2009, there was a series of national pay agreements and understandings. The agreements were negotiated at Employer Labour Conferences, which consisted of the Irish Congress of Trade Unions, the Government and employer representative bodies. The agreements also provided political promises by the Government, to take measures in certain areas of Government policy, in particular, in relation to social welfare, taxation and employment rights.
There were agreed rates of pay increases, which it was intended would be implemented at sectoral levels. Exceptions might be provided in certain circumstances, where employers could not meet the general pay increase, due to enterprise or sectoral constraints.
The unions agreed not to resort to industrial action, provided that the employer complied with the agreements. Sectoral industry agreements were to provide procedures for the peaceful resolution of disputes. If a union or employer breached the agreement, the relevant representative body agreed not to support them.
The Employer-Labour Conference and its committees met periodically to review the implementation of agreements and in order to examine particular issues. Over time, a wider range of interests was introduced into the process.
National Agreements II
The last agreement, “Towards 2016”, covered a very broad range of matters in relation to economic and social policy as well as employment rights, public service pay and other matters. Following the unprecedented economic crisis, a review and transitional arrangement in 2008-2009 withdrew the contemplated pay increases. At the end of 2009, the IBEC withdrew from the arrangement as it could not obtain agreement on significant pay cuts with employee representatives across numerous sectors.
The second stage pay terms, effectively collapsed at the end of 2009 when the Government imposed income cuts of between 5% and 8% for about public servants in its Budget. Belated attempts by the ICTU public service committee to offer efficiencies and flexibility in public service work practices, a proposal for 12 days’ unpaid leave to be taken by all public servants during 2010, failed to secure either political or public support or prevent the income reductions.
The Government also applies a 5% ‘pension levy’ on public service earnings to compensate for the earnings-related defined benefit pensions enjoyed by public service employees.
A separate public service agreement, the Croke Park Agreement covering the period 2010 to 2014 was entered in 2010. This was limited to the public sector. Unlike earlier “social partnership” procedures the main private sector employer bodies were not involved, and the negotiations were facilitated by the state Labour Relations Commission (LRC). This was a three-year pay-freeze and the potential clawback of some of the imposed pay cuts in return for verified efficiencies and increased flexible working rosters and mobility.
Legally Binding Collective Agreements
A collective agreement may or may not be legally binding. The ordinary law of contract applies. There is a requirement that there be an intention to create legal relations. In effect, there is a presumption that collective agreements are not ordinarily intended to be binding.
Generally, collective agreements will not be legally binding, as the requisite intention to create legally binding relations will not be present. In some cases, it may be that certain aspects of a collective agreement are binding, while others are aspirational.
Agreements between trade unions of workers and employer associations are not usually directly enforceable by employers and employee. The principle of privity of contract applies. A party may enter a binding agreement for other, only where he acts as agent or representative of that other.
Even if an agreement would be otherwise enforceable, it may be negated by reason of duress. If an agreement is negotiated under a threat of industrial or other action, this may amount to economic duress. The duress must be such as to amount to a coercion of will and a negation of consent. It is not clear of whether action which is protected under the Industrial Relations Act from civil liability, can prevent a contract being negated on the grounds of duress.
The Labour Court determines disputes under registered employment agreements, rather than the civil courts. The complaint is made against an employer or employee, that it has failed to comply with the agreement. A Labour Court hearing takes place, and the court may direct compliance. Failure to comply is an offence.
The complaint may be brought against an employer or against a union representative of workers. If for example, a union undertakes strike action in breach of the agreement, a complaint may be brought that it is promoting or assisting a strike in contravention of the agreement. The union will be liable, only if it supported the relevant action at a sufficiently high level in the organisation.
The union may be directed to refrain from assisting a strike from its funds. Noncompliance is an offence. In some circumstances, the Labour Court may order that the agreement be cancelled.
Incorporation into Employment Contracts I
The terms of collective agreements may be incorporated into employment contracts. Some terms in the collective agreement between a union and employer can become part of the employment contract. This will happen only exceptionally. Most collective agreements deal with aspirational matters which are not sufficiently certain to have contractual effect.
If they relate to a matter usually in employment contracts, they may be incorporated. If, however, the employee objects, he is not bound.
Generally, unions and employer representatives do not act as agents of their employees and employers. However, it is possible in principle that employer-employee negotiations could be conducted on the basis of agency. If a specific agreement is entered in this context, it may be legally binding and incorporated in the employment contract. The individual employee (or employer, as the case may be) may take legal action for a breach in this circumstance.
Incorporation into Employment Contracts II
Apart from the narrow exceptional circumstances where unions may be agents for employees, the terms negotiated between the employer and employee may become incorporated into the employment contract. This may happen by custom and practice in the particular industry.
Most collective agreements deal with aspirational matters which are not sufficiently certain to have contractual effect. If they relate to a matter usually in employment contracts, they may be incorporated. If, however, the employee objects, he is not bound.
The terms and conditions provided for in a collective agreement may take effect and be incorporated in this individual employment contract, where new terms are offered to the employer, and he accepts by making no objection. The new terms become incorporated into the contract of employment, where they are implemented and accepted in practice.
References and Sources
Employment Law Meenan 2014 Ch. 7
Employment Law Supplement Meenan 2016
Employment Law Regan & Murphy 2009 Ch.17 ( 2nd Ed 2017)
Employment Law in Ireland Cox & Ryan 2009 Ch.2
Other Irish Books
Employment Law Forde & Byrne 2009
Principles of Irish Employment Law Daly & Doherty 2010
Industrial Relations Act 1946 (No. 26)
Industrial Relations Act 1969 (No. 14)
Industrial Relations Act 1976 (No. 15)
Industrial Relations Act 1990 (No. 19)
Industrial Relations (Amendment) Act 2001 (No. 11)
Industrial Relations (Miscellaneous Provisions) Act 2004 (No. 4)
Industrial Relations (Amendment) Act 2012 (No. 32)
Periodicals and Reports
Employment Law Yearbook (annual) Arthur Cox
Employment Law Reports
Irish Employment Law Journal
Employment Law Review
Dismissal & Redundancy Consolidated Legislation Barrett, G 2007
Irish Employment legislation (Looseleaf) Kerr 1999-
Employment Rights Legislation (IEL offprint) Kerr 2006
Employment Law Nutshell Donovan, D 2016
Employees: Know Your Rights Eardly 2008
Essentials of Irish Labour Law Faulkner 2013
Workplace Relations Commission http://www.lrc.ie/en/
Irish Human Rights and Equality Commission https://www.ihrec.ie/
Health and Safety Authority http://www.hsa.ie/eng/
Textbook on Employment Law, Honeyball, et al. 13th Ed. 2014
Labour Law, Deakin and Morris 5th Ed. 2012
Employment Law, Smith and Wood 13th Ed 2017
Selwyn’s law of Employment Emir A 19 Ed. 2016
Employment law : the essentials. Lewis D Sargeant M and Schwab M 11 Ed.2011
Labour Law Collins H, Ewing K D and McColgan 2012
Industrial relations law reports. (IRLR): Law Section,
Employment law Benny R Jefferson M and Sargent 5th Ed. 2012
Pitt’s Employment Law 10th Ed. Gwyneth Pitt 2016
CLP Legal Practice Guides: Employment Law 2016 Gillian Phillips, Karen Scott
Cases and Materials on Employment Law 10th Ed. Richard Painter, Ann E. M. Holmes 2015
Blackstone’s Statutes on Employment Law 2015 – 2016 Richard Kidner
UK Practitioner Services
Tolley’s Employment Handbook 2017 Mrs Justice Slade 2017
Butterworths Employment Law Handbook 2017 Peter Wallington 2017
Blackstone’s Employment Law Practice 2017 Edited by Gavin Mansfield, John Bowers, John Macmillan 2017
UK Periodicals and Reports
The Employment Law Review 8th Ed. Erika C. Collins 2017
Industrial Relations Law Reports
Employment Law in Context: Text and Materials 2nd Ed. David Cabrelli 2016