Sinead Likely
Solicitor
What future for the JLC system?
Further to an article recently featured in our Employment Law Ezine, Mr. Justice Feeney has today delivered his much anticipated judgment in the recent High Court challenge to the system allowing for the setting of rates of pay and working conditions by Joint Labour Committees (JLCs) for workers in certain sectors.
Mr. Justice Feeney has ruled in favour of the plaintiffs, John Grace Fried Chicken and the Quick Service Food Alliance, a group of fast food operators, and has granted declarations sought by them that certain provisions of the Industrial Relations Acts 1946 and 1990 are invalid having regard to the provisions of the Constitution, and also that the Employment Regulation Order (ERO) proposed by the Catering JLC and approved by the Labour Court which fixed the statutory minimum remuneration and conditions of workers within a specified geographical area is invalid.
The plaintiffs argued that the entire JLC system represented an unlawful interference with their property rights and amounted to a complete delegation of the law making function to bodies, the Labour Court and the Catering JLC, which are not subject to the supervision of the Oireachtas. It was argued that the 1946 and 1990 Acts do not identify any goals, standards or factors to be applied by the Catering JLC and Labour Court when exercising the law making powers conferred on them. It was contended that the Catering JLC and the Labour Court have the power to fix minimum rates of pay and conditions of employment in excess of those decided upon by the Oireachtas, without any reference to any identified or definable principles or policies to govern the exercise of the lawmaking power in issue.
Article 15.2.1 of the Constitution vests the sole and exclusive power of the making of laws for the State in the Oireachtas. While the Oireachtas may delegate powers to other bodies in certain situations, it has long been accepted that any such delegation cannot be excessive and must be confined to matters of detail only and not of principle. This “principles and polices” test has long been followed by the Supreme Court in considering whether powers delegated to certain bodies are constitutional. It is accepted that, while the Oireachtas may delegate a power to put flesh on the bones of an Act, thereby giving effect to principles and polices, that a delegation of power which goes beyond that is not authorised and would amount to a purported exercise of a legislative power by an authority which is not permitted to do so under the Constitution.
The current challenge to the JLC system is not the first of its kind. In 2008, there was a similar High Court constitutional challenge to the Hotels JLC which was settled after a couple of day’s hearing in the High Court. However, even as far back as 1979, in the case of Burke v Minister for Labour [1979] I.R. 354, although not a case requiring consideration of the constitutional grounds for challenging the system, Henchy J in describing the power delegated to the Joint Labour Committee commented that “the power to make a minimum remuneration order is a delegated power of the most fundamental, permissive and far-reaching kind. “ Henchy J went on to state that “apart for the skeletal provisions in the second schedule to the Act of 1946 as to its constitution, officers and proceedings, the Act of 1946 is silent as to how a committee are to carry out their functions in making orders”.
Mr. Justice Feeney found that, notwithstanding the far reaching nature of the delegation identified by Henchy J in the Burke case in 1979, this was never addressed or amended by the subsequent Industrial Relations Act 1990 or by the National Minimum Wage Act 2000. Mr. Justice Feeney pointed out that, If that had occurred, then those expert bodies (being the Catering JLC and the Labour Court) could have used their expertise and knowledge to “fill in the details…based upon principles and policies identifying standards, goals, factors and purposes laid down by statute”. However, having considered the existing legislation in its entirety, Mr. Justice Feeney could find no such policies or principles directing or informing the delegated bodies.
He also found that, although the Industrial Relations Acts 1946 and 1990 may contain certain identifiable objectives, they do not contain any identifiable policies and principles to guide the Catering JLC or the Labour Court in how to implement those objectives. He found that, in the absence of any standards, goals, policies and principles, the delegation of power to the Catering JLC and the Labour Court to set mandatory wages and conditions for certain employees was excessive. He also found that the ERO setting wages and conditions for employees in a one geographical area when significantly different wage rates and conditions applied in an immediate adjoining area without any identifiable basis for such discrimination, and where failure to comply could result in criminal prosecution, was arbitrary and unfair and amounted to an unlawful interference of the plaintiff’s property rights.
While today’s decision relates specifically to the Catering JLC, it is very likely that the decision will have serious repercussions for all existing JLCs.
Today’s decision will undoubtedly impact on the Minister for Jobs, Enterprise and Innovation’s proposals to reform the JLC system which, only as recently as last week, although not yet finalised or formalised, were reported to have at least been “agreed in principle”. The proposals being discussed at Cabinet in recent weeks, which reflected many of the recommendations made in the Walsh/Duffy report, included cuts in overtime rates and Sunday rates for employees to whom the JLCs apply. It remains to be seen if those proposals will go far enough to address the difficulties with respect to the validity of the JLC system highlighted by today’s decision.
7th July 2011
Sinead Likely
Solicitor
Employment Law Unit
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