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Supreme Court weighs in on Employment Law Issues

The first half of 2021 has certainly seen some dramatic developments from an employment law perspective. Leaving aside the enormous impact of COVID-19, there is a range of new legislation on the way and there have been a number of significant decisions at High Court, Labour Court and Workplace Relations Commission (WRC) levels. However, when assessing the first half of the year, it is impossible to look beyond two massively important Supreme Court decisions.

The first of those two decisions was in the Zalewski case, in which the Supreme Court considered a constitutional challenge to the validity of the WRC and the procedures that it follows. As has been widely reported, the Court found that the WRC should be hearing cases under employment rights legislation in public and should be administering oaths in cases where there is a conflict of evidence. The Court did, however, also make a number of other interesting observations regarding, for example, the independence of WRC Adjudication Officers in circumstances where it concluded that they are involved in the administration of justice.

Supreme Court Zalewski

The upshot of the Court's decision is that new legislation is required to empower the WRC to administer oaths; to address the issue of hearings in public and, arguably, to deal with other issues highlighted by the Court.

While the Tánaiste, Leo Varadkar, promised that emergency legislation would be published in weeks, a Bill is, in so far as we are aware, still awaited and may not reach the statute book for some time. In the interim, many cases due to be heard by the WRC will inevitably be delayed. That is an unfortunate and unwelcome delay for many employers and employees but is inevitable.

In the longer term, the Zalewski decision potentially marks the tipping point at which decision-making in disputes emanating from workplaces has irrevocably moved from the industrial relations arena into the legal one. It is distinctly possible that further legal challenges will follow the enactment of new legislation if the Oireachtas gets things wrong.

The second major Supreme Court decision came just last week in a case (NECI v The Labour Court and Others) that required consideration of the constitutionality of Sectoral Employment Orders (SEOs). Those orders can dictate rates of pay (above the national minimum wage), pension and sick pay schemes in specified sectors of the economy.

The legislation providing for SEOs was enacted in 2015. In June 2020, however, the High Court held that the legislation was unconstitutional and it set aside the SEO for the Electrical Contracting Industry. That decision was appealed to the Supreme Court by the State.

In the Supreme Court the State enjoyed some limited success in that the Court set aside that part of the High Court's decision declaring the Act unconstitutional. On the other hand, the Court upheld the High Court’s decision that the Minister of State for Business acted outside his powers in June 2019 in making a Sectoral Employment Order (SEO) for electricians.

The result of the NECI decision is that the 2015 legislation survives for the time being, but each and every SEO remains open to challenge and a new SEO will be required for electricians.

In our opinion, the outcome of the two Supreme Court decisions and the likely responses by Government in the second half of 2021 is very likely to result in further legal challenges over the coming years.

Our employment law team will be happy to assist clients requiring further advice or information.


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