Six-month stay on order striking down minimum pay rates in certain sectors

Six-month stay on order striking down minimum pay rates in certain sectors

The judge said the implications of his constitutional finding went far beyond the individual electricians' SEO. File picture.

The High Court has put a six month stay on an order striking down a law setting minimum pay and conditions for certain sectors of industry.

Mr Justice Garrett Simons ruled last month that the Minister for State for Business Enterprise and Innovation had acted outside his powers in purporting to make a sectoral employment order (SEO) for electricians in June last year.

He also found the parent legislation governing such orders, Chapter 3 of the Industrial Relations (Amendment) Act 2015, was invalid by reference to Article 15.2.1 of the Constitution (power of Oireachtas to make laws).

The case was brought by members of the Náisiúnta Leictreach Contraitheor Eireann/National Electrical Contractors of Ireland (NECI) who claimed the SEO breached their rights and was unconstitutional.

It was against the Labour Court, the Minister for Business Enterprise and Innovation, Ireland and the Attorney General, who opposed the challenge.

Further submissions were made by the parties following the judgment and today Mr Justice Simons made formal orders in the case.

The court was told the State intends to seek a "leapfrog" appeal to the Supreme Court.

The judge said the implications of his constitutional finding went far beyond the individual electricians' SEO.

Were this finding to be upheld on appeal, it would cast doubt on the validity of any SEO under the relevant chapter of the 2015 Act, he said.

However, he said, crucially even this finding would not preclude the putting in place of primary legislation imposing minimum rates of pay and remuneration in any particular economic sector. 

Nor would it preclude the regulation of such matters by way of secondary legislation, provided always that the requisite principles and policies were stated in primary legislation, he said.

His decision last month was concerned solely with the identification of which branch of government, legislative or executive, is entitled to regulate the terms and conditions of employment.

Invalidity Decision Suspended

It was a finding that the impugned legislation trespassed upon the exclusive law-making power of the Oireachtas, by leaving significant policy choices to the Minister of State, he said.

He emphasised his judgment in no way suggests the imposition of minimum rates of pay in any particular sector is "per se unconstitutional" or that there was anything to suggest the rates in the electricians' sector are overly generous.

The judge said he had concluded, following submissions from the parties, this was an appropriate case in which to exercise the exceptional power to suspend the effect of a declaration of unconstitutionality for a short period of time - six months.

The reasons include that the specific electricians’ SEO can be set aside on the narrow basis related to the finding the Minister acted outside his powers.

It would be fully consistent with the court's finding for the Oireachtas to put in place a different legislative regime providing for the regulation of terms and conditions of employment in a specific economic sector, he said.

There was also the fact that subsisting SEOs affect large numbers of workers.

A declaration of invalidity with immediate effect could cause financial hardship to at least some of them were their employers to refuse to continue to pay rates of remuneration in accordance with the relevant SEO, he said.

"This might, ultimately, lead to industrial unrest which is the very thing which the enactment of Chapter 3 of the Industrial Relations (Amendment) Act 2015 had been intended to avoid", he said.

He was therefore suspending the invalidity decision for six months.

The balance of justice also lay in favour of imposing a stay the constitutional finding on grounds including disproportionality to any benefit to the electricians by over and above the fact that their SEO was set aside on the separate grounds the Minister acted outside his powers, he said.

It was also possible the appeal court would reach a different decision and this would mean the legislation at issue would have been suspended for months until the appeal is dealt with.

He awarded costs to NECI.

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