Multinational wins employee representation case

In an important case under Ireland’s recently revised rules on employee representation in the workplace, in late 2004 the multinational company, GE Healthcare, won its argument at the Labour Court that its terms and conditions are in line with companies within its sector. It is thought that the ruling will ease fears among large non-union multinationals with Irish operations.

GE Healthcare is a County Cork-based subsidiary of a US-owned multinational. A case seeking trade union representation and improvements in pay and conditions was recently brought by the Services Industrial Professional & Technical Trade Union (SIPTU) on behalf of almost 100 employees at GE Healthcare, under the terms of the Industrial Relations (Amendment) Act 2001, as amended by the Industrial Relations (Miscellaneous Provisions) Act 2004 (IE0409204F)

The Act allows for employee representatives (who need not be a trade union) to refer a claim over workplace representation rights to the Labour Relations Commission if an employer refuses to engage in local voluntary discussions. If the employer refuses to appear at the LRC, the LRC refers the case to the Labour Court, which has the power to issue a binding decision. This final decision is enforceable in the Irish law courts.

The outcome of the GE Healthcare case has significant lessons for the large-scale non-union Irish operations of multinationals such Dell, Intel, Hewlett Packard, and Microsoft. The clear message is that that 2004 Act is highly unlikely to have implications for such multinationals, provided that their terms and conditions are of a standard that is at least in line with their particular sectors.

In the GE Healthcare case, the Labour Court backed the argument put forward by the company’s representative at the hearing, the consultant John Horgan, a former chair of the Labour Court. In doing so, the Court stated that the new representation rules do not provide for union recognition in the sense of collective bargaining rights, but are there to provide 'a measure of protection to employees in employments where collective bargaining arrangements are not in place and, in consequence, terms and conditions of employment are out of line'. The Court saw no basis on which it could conclude that the terms and conditions in GE 'when viewed in their totality, are out of line with acceptable standards'.

The case comes at a time when the the Irish Municipal Public and Civil Trade Union (IMPACT), is pursuing a high-profile claim against the highly successful international low cost airline, Ryanair, on behalf of pilots under the same law. Ryanair has refused to engage in the process. Ryanair's chief executive, Michael O’Leary, has warned the LRC that unless the Commission agrees to proceed no further with the IMPACT case, then the airline will initiate legal proceedings to challenge the constitutionality of the 2001 Act and its 2004 Amendment. Mr O’Leary added that the company would not allow 'union recognition to be imposed (through the back door of the Labour Relations Commission) upon high-pay, multinational companies who do not subscribe to the outdated low-pay/union recognition model'.