Employee consultation law to be passed

The Employees (Provision of Information and Consultation) Act 2006 will soon be transposed into Irish law. This impending legislation will have significant implications for both employees and employers.

After passing through the final stages of approval in the Irish parliament (Dáil) and senate, the Employees (Provision of Information and Consultation) Act 2006 (PDF 372Kb) is awaiting the formal signature of Ireland’s President, Mary McAleese.

Provisions of employees act

The main features of the act are:

• a 10% employee trigger mechanism for setting up an information and consultation structure;

• that trade unions will no longer be the sole channel for employee representation;

• a facility for the negotiation of ‘pre-existing’ agreements;

• the freedom to avail of ‘direct’ forms of information and consultation, to suit local circumstances.

Section 4 of the impending act, which pertains to workforce thresholds, establishes a right to information and consultation: in undertakings with at least 150 employees from a date to be prescribed before 23 March 2007; in undertakings with at least 100 employees from 23 March 2007; in undertakings with at least 50 employees from 23 March 2008.

Section 6 of this act, which pertains to employee representation, defines an employee representative as an ‘employee elected or appointed for the purposes of this Act’. It stipulates that:

where it is the practice of the employer to conduct collective bargaining negotiations with a trade union or excepted body, employees who are members of a trade union or excepted body that represents 10 per cent or more of the employees in the undertaking shall be entitled to elect or appoint from amongst their members one or more than one employees’ representative for the purposes of this Act […]

Where a dispute arises under this section, it may be referred by the employer, trade union, excepted body or one or more than one employee to the Labour Court for determination.

Potential difficulties

The stipulation that trade unions will no longer necessarily be the sole channel for employee representation should not represent a significant problem in workplaces where unions are already quite strongly established and where management is used to dealing with them.

Difficulties are more likely to arise in non-unionised sites, in partially unionised sites (e.g. where there are union members, but recognition has not been granted) or in unionised sites where management wants to bypass unions. The act raises the possibility that non-union consultation forums could end up in competition with trade union structures, particularly in sites where unions are hoping to organise.

Trigger mechanism

One of the most controversial aspects of the 2006 act, Section 7, provides that negotiations to set up an information and consultation structure will have to be ‘triggered’ by workers themselves. This should be done in the form of a written request from at least 10% of employees of the undertaking, subject to a minimum of 15 employees and a maximum of 100 employees.

An employer may also take the initiative to enter into negotiations with employees or their representatives, or both, regarding information and consultation arrangements.

Negotiations must be concluded within a six-month period, although this may be extended by agreement of the parties. Two possible outcomes can arise from these negotiations: the establishment of a negotiated agreement under Section 8 of the act or the application of the fall-back Standard Rules, as set out in Section 10 of the act.

Section 8 of the act sets out minimum requirements for negotiated agreements and for how the approval of the workforce is to be secured. A negotiated agreement shall be:

• in writing and dated;

• signed by the employer;

• approved by the employees;

• applicable to all employees to whom the agreement relates;

• available for inspection by those persons and at the place agreed between the parties.

Where no pre-existing agreement is in place or where the parties fail to introduce a negotiated agreement within six months, then the parties have to adopt – once it is feasible to do so and not later than six months after they first become applicable – the Standard Rules. These rules provide for the election of an information and consultation forum of not less than three employees or more than 30 employees.

The legislation also contains provisions for employers to continue with systems of information and consultation that deal with employees directly, as well as indirectly through elected or appointed employee representatives. However, employees must be free at a later stage to exercise their right through representatives of their choosing.

Section 15 sets out the dispute resolution procedures that will apply. Disputes regarding the negotiation of agreements, and disputes regarding the interpretation or operation of agreements or systems of direct involvement, may be referred by either party to the Labour Court for recommendation or determination, if internal dispute resolution procedures have failed. Subject to the agreement of the parties, the Labour Court may mediate or appoint a mediator to assist in resolving such disputes.

Brian Sheehan, IRN Publishing