Focus on union avoidance || Employer opposition in Ireland

International Centre for Trade Union Rights

Employer opposition in IrelandAuthor(s): MICHELLE O'SULLIVANSource: International Union Rights, Vol. 13, No. 2, Focus on union avoidance (2006), pp. 10-11Published by: International Centre for Trade Union RightsStable URL: http://www.jstor.org/stable/41936362 .

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FOCUS □ EMPLOYER RESISTANCE TO UNION ORGANISING

Employer opposition

in Ireland

Multinationals have influenced

public policy: the

IDA, which initially promoted union

recognition, now holds a 'union- neutral' stance

MICHELLE O'SULLIVAN, University of Limerick

Traditionally, since Irish trade

most unions larger

employer

organisations was not a

opposition critical

recognised issue

to

Traditionally, Irish trade unions was not a critical issue since most larger organisations recognised

unions. However, union recognition has become of increasing concern as union penetration con- tinues to decline and employer opposition grows. Union employment density dropped an estimated 27 percentage points between 1980 and 2004 and now stands at 34.6 percent. This article reviews the background to the introduction of legislation in 2001, which was supposed to tackle the issue of union recognition.

Recognition and Voluntarism The conventional Irish approach of dealing

with the union-employer relationship is based on 'voluntarism', meaning minimum intervention by the law, so, for example, there is no mandatory union recognition. Traditionally then, when union recognition disputes occurred, they were resolved through a trial of strength or by referral to the Labour Court. The Labour Court is a State body composed of employer and worker representatives and its role is to resolve labour disputes. Unions and employers have tended to make little use of the civil courts (High Court and Supreme Court) to resolve union recognition disputes. In recent years, trade unions have been forced to move away from voluntarism and seek legislation on union recognition. Employer opposition has been one of the significant obstacles to increasing recognition. A key sector of opposition is non-union multinational companies (MNCs), particularly those from the US.

US MNC Influence on Public Policy Ireland is heavily reliant on foreign direct

investment from the US. Thus, multinational employers' voices are particularly influential in public policy making, as evidenced by the following examples. First, the State Industrial Development Agency (IDA), which initially promoted union recognition to the incoming MNCs, now holds a 'union-neutral' stance. It has been argued that the IDA'S union-neutral position has given de facto approval for new investment to follow the non-union route. Second, when the issue of introducing legislation on union recognition was mooted (see below), US MNCs and the American Chamber of Commerce (ACC) strongly argued against mandatory recognition or any European style works council. It emphasised the potential negative effects of such legislation on attracting multinational investment.

Union Recognition Legislation? Unions, having recognised their increasingly

frail position at organisational level, began to lobby the Government in the mid-1990s to

address the issue of union recognition. Their political pressure resulted in the establishment of a 'High-Level Group' in 1997. The Group com- prised of representatives of Government depart- ments, union and employer bodies and the IDA. The Group produced a report in 1997 but was rejected by unions following a recognition dispute at Ryanair. A second report in 1999 resulted in the introduction of the Code of Practice on Voluntary Dispute Resolution and the Industrial Relations (Amendment) Act 2001, which was amended in 2004. A key feature of these new procedures is that only disputes about terms and conditions of employment and dispute resolution and disciplinary procedures can be referred under them. The provisions do not provide for statutory union recognition. This is most likely related to the IDA'S concern over its ability to attract US multinational investment if mandatory union recognition was a reality. Some employers though have expressed concern over a provision of the Acts, which allows the Labour Court to set legally binding pay and conditions of employment of the workers in dispute before it.

The Case of Ryanair The fight for union recognition between the

Services, Industrial, Professional and Technical Union (SIPTU), IMPACT, and its branch, the Irish Airline Pilots Association (IALPA) and Ryanair has been lengthy, bitter and high profile. Ryanair is an Irish owned airline, which was established in 1985 to compete with Aer Lingus and British Airways on the Ireland-UK routes. Its rise to prominence has been accompanied by Michael O'Leary's climb up the company's ladder. He became Chief Operating Officer in 1993. The charismatic leader pursued a business model based on Southwest Airline's 'low fares/no frills' template and opened up routes to smaller European airports, which were keen on obtain- ing Ryanair's custom. The low cost model has spilled over into the 'unique' working conditions of its staff, for example, according to Clark (2005), 'crew have to pay for their own training, uniforms and meals, head office staff must supply their own pens and are even forbidden from charging their mobile phones at work'.

Ryanair has been just as infamous for its diffi- cult relationship with Irish trade unions as it has been for its commercial success. Ryanair's first major battle with unions in Ireland took place in 1998 when it refused to recognise and negotiate with SIPTU on behalf of 39 baggage handlers. The baggage handlers subsequently went on strike for nine weeks, which culminated in the closing down of Dublin airport. In 2004, IMPACT and IALPA referred a dispute to the Labour Court under the Industrial Relations (Amendment) Act

INTERNATIONAL union rights Page 1 0 Volume 13 Issue 2 2006



2001. Ryanair argued that the Court did not have jurisdiction to hear the case because no trade dispute existed, and because Ryanair engaged in collective bargaining with its Employee Representative Committees (ERCs). However, the Labour Court determined that a trade dispute did exist and that Ryanair's engagement with the ERCs was a form of consultation and could not be described as 'collective bargaining'. Following the Labour Court's decision, Ryanair froze pay increases and share options to some employees, which had been previously negotiated. Ryanair then lodged a claim with the High Court, chal- lenging the jurisdiction of the Labour Court to hear the dispute. The High Court concluded that the Labour Court did have jurisdiction. IMPACT'S then general secretary, Peter McLoone, declared that the decision sent 'the clearest possible mes- sage that all workers are entitled to choose to be represented by a trade union, and to access the State's industrial relations bodies, if they encounter problems with their employers'. The general secretary may have spoken too soon. Since then, the Supreme Court has granted an order, as requested by Ryanair, to prevent the Labour Court from investigating the dispute until a full Supreme Court appeal is heard.

In 2005, it was reported that the 100 Ryanair pilots in Ireland submitted over 200 claims of victimisation under the new industrial relations legislation. Similar to the above case, Ryanair has challenged the authority of the dispute resolution body involved, the Rights Commissioners, to carry out the investigations. It is awaiting a hear- ing in the High Court. Should a Rights Commissioner hear the claims of victimisation and find in favour of the employees, the IALPA president Evan Cullen predicted that the cases 'would expose Ryanair to claims of up to 50 mil- lion and further legal costs' (Sheehan, 2005).

In 2006, Ryanair wrote to 64 pilots offering them training to operate a new type of aircraft, subject to a number of conditions. One of these stipulated that if Ryanair was forced to engage in collective bargaining with a union within five years of the training commencing, each pilot would be liable to pay back the training costs to the company, which amounted to 15,000 euro. Another condition was that some pilots had to confirm that they had no claims against the company under the new industrial relations legislation. The employees took a case against Ryanair to the High Court and argued that the letters were in breach of their constitutional right to form and join unions and of their rights under the European Convention on Human Rights. In response, Ryanair argued that there was no oblig- ation on it to recognise a union. In addition, it claimed that the union was holding the company at ransom by taking proceedings to the High Court while simultaneously referring cases under the Industrial Relations Acts, 2001-2004. The High Court however rejected Ryanair's argu- ments and ruled in favour of the employees and union.

Conclusion There are a number of implications arising

from the continued opposition of Ryanair to recognition and to the methods by which they

have opposed it. The first is that Ryanair's opposition must be seen in the wider public policy con- text. Ryanair's argument that the new industrial relations legislation is pro-union is hard to sustain given that mandatory recognition was not provid- ed. A key reason for this is the concern of the Government and IDA to attract and retain multinational investment. Second, in avoiding recognition, Ryanair has challenged the State's dispute resolution machinery, in a way in which they have not been challenged previously. The chal- lenges stem from Michael O'Leary's view that the Industrial Relations Acts 2001-2004 are unconsti- tutional and he opposes the potential power of the Labour Court to determine the wages of his employees. Third, the extensive use of the civil courts by Ryanair and its employees and unions goes against the grain of the traditional volun- tarist methods of resolving disputes. Fourth, despite the trade union movements' push for legislation, the new procedures have not eased the path to union recognition in Ryanair. Shay Cody, IMPACT'S deputy general secretary, has argued that a consequence of O'Leary's quest to 'resist unions at any price' is that it has created 'ironical- ly, a very well-organised pilot body'.

Despite unions'

push for

legislation, the new procedures have not eased the

path to union

recognition in

Ryanair

Page 1 1 Volume 13 Issue 2 2006 INTERNATIONAL union rights



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Focus on union avoidance || Employer opposition in Ireland