Employment Matters, Christmas 2011

Profession:Arthur Cox

Article by: Employment and Industrial Relations Group at Arthur Cox

Reform of Irish Employment Rights and Industrial Relation Structures and Procedures

Ireland's current system of employment rights and industrial relations is "extremely complex and protracted" according to the recent Consultation Paper on Reform of the State's Employment Rights and Industrial Relations Structures and Procedures.

The key stated objectives of the Minister for Jobs, Enterprise and Innovation's reform proposals in August 2011 are:

Resolution of grievances and disputes as close to the workplace as possible and as early as possible after they arise. A simple and efficient institutional structure Minimising the number of cases that present for resolution at formal hearings through active case progression and an increased range of interventions. Arthur Cox made a Submission on the Consultation Paper. A summary and analysis of the Submissions are available on: http://www.djei.ie/employment/rights/erirproject.html

Transfer of Undertakings

Article 3(1) of the TUPE Directive provides that "the transferor's rights and obligations from a contract of employment ... existing on the date of a transfer shall, by reason of such transfer, be transferred to the transferee." The UK Supreme Court in Alemo-Herron v Parkwood Leisure Ltd (2011) recently decided to ask the European Court to clarify the interpretation of a transferee's obligations under this Article, specifically whether the interpretation is 'static' or 'dynamic'. What does this mean?

In Werhof v Freeway Traffic Systems (2006) the European Court gave a 'static' interpretation to Article 3(1) when it held that transferees who are not members of an employer's association do not have to apply new collective agreements entered into by the association after the transfer. Good news for employers. However, there is a consistent line of UK EAT cases to the contrary which have given a different, 'dynamic,' interpretation to a transferee employer's obligations. These cases held that where an employee has a contractual term that their pay will be determined in accordance with collective agreements negotiated from time to time, that term transfers with the employee under TUPE, thus obliging the transferee to apply the results of collective negotiations to which the transferor was a party, even if the transferee themselves were not.

Employers had hoped the UK Supreme Court would uphold a static interpretation and invalidate...

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