FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 2004 SECTION 32, INDUSTRIAL RELATIONS ACT, 1946 PARTIES : MYTHEN BROTHERS LTD (REPRESENTED BY BCM HANBY WALLACE, SOLICITORS) - AND - BUILDING AND ALLIED TRADES UNION DIVISION : Chairman: Mr Duffy Employer Member: Mr Doherty Worker Member: Ms Ni Mhurchu |
1. Construction Industry Registered Employment Agreement - Wages and Conditions of Employment.
BACKGROUND:
2. This is a complaint by BATU (the Union) alleging a breach of the Registered Employment Agreement (REA) (Construction Industry Wages and Conditions of Employment), (the Agreement) by Mythen Brothers Ltd (the Employer). The Union's complaints are as follows:
“1. The company has refused to abide by the “Procedure for Settling Grievances and Disputes” as outlined in Section 11 of the R.E.A.
2 The Company are in breach of Section 10 of the R.E.A. “Engagement of Subcontractors” in that they are employing subcontractors who are not compliant with the criteria laid out in clauses A, B, C, D, E, F, G, and H”
The Company submits that it has not breached Clause 11 of the REA as this is not a dispute which was properly taken through the REA. The Company also submits that it has not breached Section 10 in relation to named sub-contractors identified by the Union. On the 29th August, 2005, the Union referred the complaint to the Labour Court Under Section 32 of the Industrial Relations Act, 1946. Court hearings took place on the 11th December, 2005, and on the 21st November, 2005.
The following is the Court's Decision.
DECISION:
In its submission to the Court the Union particularised its complaints as follows:
- “1. The company has refused to abide by the “Procedure for Settling Grievances and Disputes” as outlined in Section 11 of the R.E.A.
2 The Company are in breach of Section 10 of the R.E.A. “Engagement of Subcontractors” in that they are employing subcontractors who are not compliant with the criteria laid out in clauses A, B, C, D, E, F, G, and H”
The relevant provision of the Agreement are as follows:
Clause 10
- ENGAGEMENT OF SUB-CONTRACTORS
The parties agree that contractors and sub-contractors covered by the Registered Employment Agreement for the Construction Industry should be free to engage approved contractors in any trade or activity in the industry. For the purpose of this agreement, approved sub-contractors are defined as follows: -
They must comply with the terms of the Registered Employment Agreements for the industry.
- (a) They must employ the appropriate grades of trade union labour.
(b) They must supply material as well as labour in those sectors of the industry where this has been normal practice.
(c) They must comply with the Social Welfare Acts and Section 17 of the Finance Act, 1970 as amended by the Finance Act, 1995 and they must conform to the guidelines issued by the Revenue Commissioners under the Finance Act, 1995.
(d) They must maintain a safe and healthy environment and comply with the provisions of the Safety in Industry Act, 1990.
(e) They must carry employers’ liability insurance in respect of their employees and the work in which they are engaged unless this cover is provided by the main contractor or the client.
(f) They must employ appropriate numbers of apprentices relative to the number of craft workers employed.
(g) They must, if in a labour only category, give security in a manner to be determined from time to time by the NJIC for the ConstructionIndustry against default in respect of any liabilities they may have to employees.
- ENGAGEMENT OF SUB-CONTRACTORS
- Clause 11.
PROCEDURE FOR SETTLING GRIEVANCES AND DISPUTES
If a trade dispute occurs between workers to whom this Agreement relates and their employers, no strike or lock-out, or other form of industrial action shall take place until the following procedures have been complied with and the Labour Court has issued a recommendation.
Category A Disputes
For the purposes of this Agreement questions concerning local matters or matters of an individual nature are regarded as category A disputes. Where these disputes arise, the following procedure shall be complied with :- (a) The grievance or dispute shall in the first instance be discussed between the parties concerned. If the dispute is not resolved within 3 days it may be referred to the trade union concerned and, where appropriate, the Construction Industry Federation (CIF). Notice in writing of the dispute shall be given by the individual concerned or his trade union to the CIF.
(b) If the dispute is not resolved within 7 days, or such longer period as may be mutually agreed, the issue may be referred to a Construction Industry Disputes Tribunal (CIDT).
(c) The CIDT will issue a decision within one week. The decision of the CIDT, where unanimous, shall be binding.
(d) Other decisions may be appealed to a Rights Commissioner, the Labour Relations Commission or the National Joint Industrial Council (NJIC) as appropriate.
(e) If the issue remains unresolved, it shall be referred to the Labour Court for investigation and recommendation.
- (a) The grievance or dispute shall in the first instance be discussed between the parties concerned. If the dispute is not resolved within 3 days it may be referred to the trade union concerned and, where appropriate, the Construction Industry Federation (CIF). Notice in writing of the dispute shall be given by the individual concerned or his trade union to the CIF.
- Construction Industry Disputes Tribunal
The Tribunal shall be established to deal with Category A disputes as defined above. The Tribunal will consist of the following:- - Independent Chairman. The Chairman of the NJIC may act as the
independent Chairman in this regard
- one employer representative to be nominated by the employers’ side of the NJIC
- one trade union representative to be nominated by the employees’ side of the NJIC
Category B Disputes
For the purposes of this Agreement questions concerning wages, working hours and conditions of employment in the industry are regarded as Category B disputes.
Where these issues arise, the following procedure shall be complied with :- (a) Any grievance or dispute that arises between workers and employers covered by this Agreement will in the first instance be discussed between the parties concerned and their trade unions.
(b) Where the issue remains unresolved after (a) above, it shall be referred to the NJIC. The Secretary of the NJIC, within 3 days of receiving written notification of the dispute from either of the parties involved, shall arrange a meeting to discuss the issue in dispute.- (c) If after a meeting of the NJIC the issue remains unresolved, it shall be referred to the Labour Court for investigation and recommendation.’
- - Independent Chairman. The Chairman of the NJIC may act as the
- Clause 11.
It appears that the Employer initially agreed to meet with the Union and a date for such a meeting was agreed. This was subsequently cancelled by the Employer and a number of other dates were later fixed which the Employer also cancelled. Finally the Union referred the matter to the NJIC for the Construction Industry pursuant to Clause 11 of the Agreement as a category A dispute. The Employer subsequently refused to participate this process.
Against that background the Union now complain that the Employer contravened Clause 11 of the agreement in not agreeing to submit the dispute concerning the status of its members to adjudication under the NJIC procedures. They further complain that the Employer contravened Clause 10 of the Agreement in treating its members as subcontractors in circumstances in which they do not meet the definition of an approved subcontractor set out in that Clause.
The Employer contends that it is not the employer of the Union members and in these circumstances it does not come with the scope of Clause 11 of the Agreement. It advanced the argument that since the Union members are not employed under a contract of service the NJIC cannot purport to investigate a dispute in relation to the conditions of their engagement. Moreover, the Employer contends that even if the Union members are not approved subcontractors, this does not mean that it is required to employ them on a contract of service.
Interpretation of the Agreement.
In considering whether or not the complaints herein are well founded the Court must first interpret the Agreement so as to establish its scope. In so doing the Court is conscious that the Agreement is primarily an industrial relations instrument which was drafted by industrial relations practitioners for the guidance of employers, employees and trade unions. Consequently the interpretation of the Agreement should not be approached as if it were a statute or the product of legal draftsmanship. Rather, the terms of the Agreement should be construed by applying to them a meaning which they would normally bear in the conduct of industrial relations so as to achieve the result envisaged by the parties to the Agreement. It seems to the Court that this approach finds support from Section 33 of the Act, which allows a Court of Law to defer to this Court for a definitive interpretation of a Registered Employment Agreement.
Scope
Clause 2 of the Agreement provides that it applies to workers who are employed in one of a number of capacities, including that of Bricklayer, by a Building and Civil Engineering Firm. The term “Building and Civil Engineering Firm” is defined by the second schedule to the Agreement. There is no suggestion that the Employer is not such a firm. It is, however, necessary to consider if the Union members to who this complaint relates areworkersand if they areemployedby the Employer.
Neither term is defined by the Agreement. However the meaning of the terms “worker”and “employer”, as used in this Agreement, was recently considered by the High Court inBuilding and Allied Trades Union and Another v The Labour Court and Others,High Court, Unreported, Murphy J. 15th April 2005. This was an application by way of Judicial Review by BATU to quash an order of this Court varying the Agreement so as to incorporate, inter alia, what is now Clause 10 of the Agreement. It was contended that the effect of the proposed variation was to extend the scope of the Agreement by including subcontractors within its terms. In rejecting this contention, Murphy J considered the meaning of the term“worker”as used in the Agreement by reference to the definition of that term contained at Section 23 of the Industrial Relations Act 1990. This Section provides as follows:
- 23.—(1) In the Industrial Relations Acts, 1946 to 1976, and this Part, "worker" means any person aged 15 years or more who has entered into or works under a contract with an employer, whether the contract be for manual labour, clerical work or otherwise, whether it be expressed or implied, oral or in writing, and whether it be a contract of service or of apprenticeship or a contract personally to execute any work or labour including, in particular, a psychiatric nurse employed by a health board and any person designated for the time being under subsection (3) but does not include—
[not relevant]
Murphy J. pointed out that this was a wider definition that contained at Section 8 of the same Act, and is not confined in its scope to those employed under a contract of service. The Judge continued at page 36 of the Judgment:-
- “The former definition, which was the relevant definition for the purpose of this application, refers, in addition to a contract of service or of apprenticeship, to "a contract personally to execute any work or labour". This would seem to imply a contract for services and, accordingly, to include an individual worker acting as contractor or sub-contractor. "Person" is not defined but is limited to persons aged 15 years or more and, accordingly, would not appear to include legal persons, such as companies or partnerships.”
In considering the scope of the word“employer”Murphy J. referred to the definition of that term contained at Section 8 of the 1990 Act, which provides:-
- "A person for whom one or more workers work and have worked or normally work or seek to work having previously worked for that person."
.
- “….It seems, accordingly, that a 'worker' is wide enough to include an individual sub-contractor. The sub-contracting company, on the other hand would appear to be an employer as defined by s. 8 of the Act. Accordingly, both a worker as an individual sub-contractor or sub-contractor as an employer of workers would appear to be within the ambit of the Registered Employment Agreement of 1967”.
It seems to follow from the ratio of this Judgment that a person who contracts to provide his or her labour to another is a worker and that the recipient of that service is an employer. In that context the term“employed”must include the engagement of a worker whether the nature of the contract of engagement be one of service or for service.
Thus a worker in one of the designated occupations referred to at clause 2 of the Agreement who is engaged by a Building or Civil Engineering Firm is entitled to all the benefits of the Agreement and an employer may not avoid liability under the Agreement by seeking to designate the worker as an independent contractor.
Purpose of the Agreement.
This analysis of the position also accords with what is clearly the common sense and practical purpose of the Agreement. The Agreement was registered with the Court so as to ensure that its terms were equally applied to all workers and employers in the Construction Industry. This in turn reflects the diverse nature of the industry which comprises a large number of individual firms and companies who tend to compete with each other for contracts. The sector is labour intensive and costs saved by an employer in the wages paid to workers could provide a significant competitive advantage over those who adhere strictly to the Agreement. It was thus considered desirable to provide common terms and conditions for all construction workers and employers and to maintain “a level playing field”
Clause 10 of the Agreement clearly allows for the engagement of what are described as “approved subcontractors”. This criteria plainly envisages that approved subcontractors will be employers of others rather than persons providing services personally. As was pointed out by Mr Justice Murphy inBATU v The Labour Court, such persons are obliged to afford to their employees all the benefits of the Agreement in the same way as any other employer. Thus all workers in the industry are covered by the terms of the Agreement regardless of the status of their employer.
The Facts.
The Court heard extensive submissions made on behalf of the Employer and the Union. The Court also had the opportunity to question relevant parties who attended the hearing. It is clear to the Court that Mr Hugh Christie was never an employer of others and has always worked as a bricklayer for various employers within the terms of the Agreement. Mr Christie applied for work with the Employer, together with Mr John Christie. They were not a subcontracting firm and did not apply in that capacity. From the time they commenced work with the Employer they insisted that their status was that of workers and not subcontractors. When the Employer insisted that they were subcontractors they referred the dispute concerning their status to their Union. The Union then sought to deal with the matter in discussions with the Employer. It appears that at one stage the Construction Industry Federation (CIF) was involved on behalf of the Employer and meetings were arranged. The Employer cancelled these meeting and the CIF ceased to have any involvement in the matter. The Union then sought to invoke the disputes resolution procedure of the Agreement and the employer declined to participate in that process.
Mr Hugh Christie was paid a composite amount in consideration of the work undertaken by himself, Mr John Christie and a general operative who worked with them. Mr Christie cashed this cheque because, he said, he and his colleagues needed the money and they did so under protest pending the resolution of the dispute through their Union. The Court accepts as a matter of fact that the Union members concerned in this dispute were at all time supplying their own labour to the Employer and that Mr Hugh Christie never agreed to employ any other person. The manner in which payments were made to Mr Hugh Christie was, in the Court’s view, a device intended to obfuscate the reality of his status and did not amount to acquiescence with the Employer's contention that he was a subcontractor. Accordingly the Court is satisfied that the Union members were workers within the meaning of the Agreement.
Application of Clause 11 of the Agreement.
Clause 11 of the Agreement is intended to provide for the orderly resolution of disputes which arise between workers and employers. Such disputes have arisen in the past in relation to the employment status of individuals and in relation to workers who have been dismissed. If the Employer’s contention that the wordstheir employers,as used in Clause 11, must be read literally such disputes would not be open to resolution through the procedure. It seems to the Court that the parties to the agreement could not have intended such a result which would undoubtedly increase the likelihood of industrial action in pursuance of such disputes. That would be the antithesis of what the procedure is intended to achieve. Finally, while the agreement does not expressly provide that an employer, or a union, must cooperate in the procedures prescribed by Clause 11, such an obligation must be implied.
While it seems clear to the Court that the Union members in this case are workers employed by the Employer within the meaning of the Agreement, any disagreement on that point should have been referred for adjudication to the NJIC in accordance with Clause 11 of the Agreement. The Court is satisfied that in refusing to do so the Employer contravened the Agreement and the Union’s complaint in that regard is, accordingly, well founded.
Clause 10.
The Union’s complaint in respect of Clause 10 of the Agreement appears to relate to the Company’s contention that its members to whom the complaint relates are unapproved subcontractors. The Court has already concluded that the individuals concerned are not subcontractors but workers. Accordingly this aspect of the complaint does not arise for adjudication.
Decision of the Court
In accordance with Section 32(1)(b) of the Industrial Relations Act 1946 the Court directs the Employer herein to comply with Clause 11 of the Agreement.
Signed on behalf of the Labour Court
Kevin Duffy
14th December, 2005______________________
JB/Chairman
NOTE
Enquiries concerning this Decision should be addressed to Jackie Byrne, Court Secretary.