Background for Ireland

Ireland is a small, open economy, heavily dependent on international trade and foreign direct investment. Between 2012 and 2022, Irish gross domestic product grew by an impressive 110.24%, over seven times the EU average for the same period (15.29%). From 2012 to 2022, total unemployment decreased by 11 percentage points, reaching 4.5% in 2022, whereas the EU average stood at 6.2% for that year. In the same period, youth unemployment decreased from 30.8% to 10.1%. Employment rates between 2012 and 2022 showed some growth, increasing from 71.1% to 76.7%.

The industrial relations system has historically been characterised by ‘voluntarism’; this has meant minimum intervention by the law rather than non-intervention by government in collective bargaining. However, in the context of the EU Directive on Adequate Minimum Wages, the government formed a high-level group within the social partner Labour Employer Economic Forum (LEEF) tasked with making recommendations on reforms to industrial relations and collective bargaining in Ireland. This group published its recommendations in October 2022, which are yet to be legislated for as of March 2024. Among these recommendations is a new ‘good faith engagement’ proposal, which makes it compulsory for non-union employers to engage with representative trade unions. This and other high-level group proposals serve to challenge the conventional approach of industrial relations voluntarism in Ireland.

The growth of individual employment law has led to the development of an increasingly complex system of institutions that operate in a quasi-legal fashion to adjudicate on cases. In 2015, a one-stop shop system was established, whereby all first-instance adjudication claims are handled by the Workplace Relations Commission, with a single avenue of appeal to the Labour Court.

The reform of wage-setting sectoral agreements through joint labour committees (JLCs) and registered employment agreements (REAs) was passed into law in 2015, with both JLCs and new REAs and registered employment orders permitted to be established. The Industrial Relations (Amendment) Act 2015, which included a new definition of collective bargaining and provided enhanced protection for workers against victimisation, was also passed in July 2015. It amended aspects of the 2001–2004 Industrial Relations Acts that severely limited their use. However, several attempts to utilise sectoral bargaining under the 2015 amendment act have been stopped by the courts, owing to defects in the procedure used under the law.

The Employment (Miscellaneous Provisions) Act 2018 was passed in 2018. The act made the following changes:

• prohibited the use of zero-hour contracts, except in limited circumstances

• provided for the provision of minimum payments to low-paid employees who are required to be available to work but are not called into work

• created a new entitlement to banded hours contracts

• obliged employers to notify employees in writing of five core terms of employment within five days of starting employment

The industrial relations system has changed significantly since the start of the 21st century, with a concentrated period of change since 2009. There has been a gradual erosion of voluntarism and collectivism and a growing legalisation of the employment relationship – particularly the growth of individual rights-based employment law in certain areas.

The Industrial Relations (Amendment) Act 2015 gave effect to the Programme for Government commitment to reform legislation on collective bargaining. The act defines collective bargaining as voluntary engagements or negotiations between any employer or employer organisation on the one hand and any trade union of workers or excepted body on the other hand, with the objective of seeking agreement regarding the working conditions or terms of employment or non-employment of workers. The definition requires that there be more than consultation or the exchange of information. The purpose of the exercise must be to seek agreement on working conditions and the terms of employment or non-employment.

The act does not impose any obligation on employers to engage in collective bargaining. However, it broadens the circumstances in which workers whose employers refuse to engage in collective bargaining can have relevant disputes addressed. Trade unions can bring a case before the Labour Court on behalf of members who are not recognised by an employer and secure a binding recommendation on terms and conditions. Where these can be shown to be out of line with similar employment in that sector, the court is likely to recommend improvements. Ultimately, such a recommendation is legally enforceable. However, since the legislation was enacted, trade unions have taken just four such cases to the Labour Court, securing benefits for members in two of them. Their reluctance to use the legislation more extensively has been explained by the fact that comparability criteria under the revised 2015 legislation are quite challenging. In addition, a case may take a long time to be concluded, and therefore use more trade union resources than traditional dispute resolution channels (see Dobbins et al, 2020).

The Competition (Amendment) Act 2017 provides that trade unions may apply to the Minister for Jobs, Enterprise and Innovation to permit certain groups of self-employed workers to act collectively. The minister will make the decision, after consultation with other government ministers and any other person or body the minister considers ought to be consulted. As of 2024, no requests had been made by trade unions regarding this provision for self-employed groups.

Perhaps the most important trend in Irish industrial relations over the past 20 years was the introduction, evolution and subsequent breakdown, in early 2010, of national-level collective bargaining and social dialogue (social partnership). In 1987, the first of seven tripartite centralised agreements or social pacts were negotiated. These centralised pacts covered not only pay but a range of social and economic issues. Evaluations of social partnership, before it broke down, varied from seeing it as contributing to strong economic performance, growing employment, low levels of unemployment, rising real wages and decreasing levels of absolute poverty to a perception that it increased inequality in wages and resulted in higher levels of relative poverty and lower expenditure on public services than in other advanced economies. Since the end of formal social partnership, collective bargaining has taken place at company level in the private sector.

Meanwhile, in the public sector successive bilateral national collective wage deals have been agreed between the government and the public service unions: the Croke Park Agreement (2010–2013), the Haddington Road Agreement (2013–2015), the Lansdowne Road Agreement (2015–2017) and the Public Service Stability Agreement (2018–2020). In December 2020, the parties negotiated the ‘Building Momentum’ agreement (2021–2022), which a number of large public service unions advised their members to accept. Owing to economic pressures, such as rising inflation in early 2022, this agreement was revisited and extended, and ran until the end of 2023. The Building Moment agreement will be succeeded by a new Public Services Agreement 2024–2026, following successful negotiations in early 2024.

The Lansdowne Road Agreement commenced a gradual process of pay restoration carried through in subsequent agreements. These bilateral collective bargaining agreements are viewed by some as a form of shadow social partnership in the public sector.

In 2016, the LEEF, which includes representatives of employers and trade unions as well as government ministers, was established. The aim of the LEEF is to provide a space to discuss areas of shared concern related to the economy, employment and the labour market on a thematic basis, looking at topics such as competitiveness, sustainable job creation, labour market standards, and equality and gender issues in the workplace. However, the LEEF does not deal with pay issues.

Direct social dialogue, involving government and the lead national-level employer organisation (Ibec, formerly known as the Irish Business and Employers’ Confederation) and trade union confederation (Irish Congress of Trade Unions (ICTU)), was especially useful in 2020 in respect of measures to meet some of the challenges posed by the COVID-19 pandemic. The ICTU and Ibec were influential in the design of pandemic-related payments, such as the basic Pandemic Unemployment Payment and those provided through the Temporary Wage Subsidy Scheme. The Pandemic Unemployment Payment was paid directly by the state to people who were laid off, or lost their jobs, due to the COVID-19 pandemic. The main payment at the outset was €350 per week, which was later reduced as the economy opened back up, before being restored to a higher level as restrictions on the economy were reimposed. The Temporary Wage Subsidy Scheme payments subsidised workers’ income in cases where business turnover was reduced by more than 25–30%. The employer was expected to fill the gap between the state payment and the worker’s weekly earnings before the pandemic. Importantly, this measure helped to maintain the link between employers and their workers in firms where the reduction in business – in ‘normal’ times – would have led to redundancies.

The social partners played an even more direct role in devising a ‘return to work’ protocol ahead of the economy opening up temporarily in the summer of 2020, involving the Health and Safety Authority in the carrying out of inspections. The protocol also provided a role for worker representatives, in consultation with employers, in ensuring the proper application of the protocol measures at the level of the business.