INDUSTRIAL RELATIONS ACTS, 1946 TO 2004
SECTION 32, INDUSTRIAL RELATIONS ACT, 1946
- AND -
BUILDING AND ALLIED TRADES UNION
Chairman: Mr Duffy
Employer Member: Mr Doherty
Worker Member: Ms Ni Mhurchu
1. Construction Industry Registered Employment Agreement - Pensions Assurance And Sick Pay
2. A Labour Court hearing took place on the 16th December, 2005.
The following is the Court's Decision:
This case arises from a complaint by the Building and Allied Trades Union (BATU) alleging that Patrick McKevitt and Flagstaff Ltd contravened the provisions of the Registered Employment for the Construction Industry (Pension Assurance and Sick-Pay) (the Agreement).
The complaint made to the Court was in respect of “Patrick McKevitt T/A Flagstaff Ltd. At the commencement of the second hearing the Court was told that in 2003 Patrick McKevitt became incorporated as Flagstaff Ltd. Accordingly, in so far as the complaints relate to periods prior to 2003 the Respondent is Patrick McKevitt personally and in so far as they relate to periods from 2003 onwards the Respondent is Flagstaff Ltd. However hereinafter the Respondent is referred to in the singular and as a natural person and includes both Patrick McKevitt and Flagstaff Ltd.
The substance of the complaint is that in contravention of the Agreement the Respondent failed to operate and maintain an approved pensions assurance and sick pay scheme in respect of a number of Carpenters engaged by him in the provision of carpentry services to Builders. The Respondent claimed through his Counsel, Ms Daly B.L, that he is not obliged to operate such a scheme as the persons to whom the complaint relates are self-employed contractors and are not workers within the meaning of the Agreement. Thus the key issue arising for determination turns on the interpretation of the terms “worker” as used in the Agreement and in the Industrial Relations Acts 1946 to 2004 under which the Agreement is registered.
At the first hearing the Court asked the parties to consider the implications for the issue arising in the instant case from the Judgment of Mr Justice Murphy inBuilding and Allied Trades and Valentine Scott v The Labour Court and The Construction Industry Federation and Gerry Fleming ,High Court, Unreported, 15th April 2005.(herein after referred to as the BATU case). In that case Murphy J interpreted the term “worker” as including, for the purposes of the Agreement, a sub-contractor providing services personally under a contract for service.
At the second hearing Counsel for the Respondent properly accepted that unless the instant case could be distinguished from the BATU case her defence to the complaint herein could not succeed. Counsel submitted that this case can be so distinguished and in consequence this Court is not obliged to follow the interpretation of the term worker formulated in that case. Counsel also submitted, in the alternative, that as the decision in the BATU case is under appeal by BATU to the Supreme Court the instant case should be stayed pending the outcome of the appeal.
This Court is bound as a matter of law by the legal doctrine of precedent (orstare decisisas it is technically known). By application of this doctrine this Court is absolutely bound to accept the opinion of Murphy J in the BATU case on the meaning of the term “worker” to the extent that it was an integral part of the decision in that particular case.
That case arose from an application by BATU to quash, by way of Judicial Review, a decision of this Court to register a variation to the Registered Employment Agreement for the Construction Industry (Wages and Conditions of Employment) relating to the engagement of sub-contractors. Like the Agreement now under consideration, that agreement was also expressed to apply to workers in a designated occupation and their employers. The grounds relied upon by the Applicant included, inter alia, a claim that the impugned variation purported to extend the scope of the Agreement by bring sub-contractors within its ambit. On the authority of the decision of Carroll J inSerco Services Ireland Limited v. Labour Court ELR 1such a purported extension of the Agreement by way of a variation order would be ultra vires the powers of the Court.
In order to deal with that aspect of the case it was necessary for the Judge to decide if labour only sub-contractors came within the original scope of the Agreement as either workers or employers. In resolving that question Murphy J. looked at Sections 23 and 8 of the Industrial Relations Act 1990. While the latter Section is expressly for the purpose of Part II of the Act only (which deals with trade dispute law) the Judge nonetheless found it of assistance in providing a definition of the term “employer” for the purpose of considering the ambit of the Agreement. In reviewing the relevant statutory provisions Murphy J. stated as follows:
- "Worker" in the Industrial Relations Acts, 1946 to 1976, is defined by s. 23 of the Industrial Relations Act, 1990 as follows:
- " '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 express or implied, oral or in writing, and whether it be a contract of service or of apprenticeship or of a contract personally to execute any work or labour…"
Most persons excluded, employees of the State, teachers are governed by separate schemes of conciliation and arbitration.
The definition of worker for the purpose of trade disputes in s. 8 of the same Act is a different definition:
- " 'Worker' means any person who is or was employed whether or not in the employment of the employer with whom a trade dispute arises…"
The latter definition, for the purpose of trade disputes, does not appear to be as extensive as the definition under s. 23.
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.
Employer, on the other hand, is defined by s. 8 of the 1990 Act as meaning:
- "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."
Such workers are not defined as employees. 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.
•The word “worker” when used in a Registered Employment Agreement is to be construed by reference to the definition of that term contained at Section 23 of the Industrial Relations Act 1990,
•On a true construction of the said Section 23 a natural person providing services personally to another on a contract for service is a worker,
•For the purposes of a Registered Employment Agreement an employer includes a person for whom a worker works.
As Counsel for the Respondent pointed out, the facts in the BATU case are different to those of the instant case. Nonetheless the points of interpretation which arise in this case were comprehensively addressed in that case. The conclusions reached by Murphy J on those points were an integral part of his Judgment and were necessary steps in deciding the case. They must, therefore, be regarded as part of the reasons for the decision (technically known as theratio decidendiof the case) and are binding on this Court.
On this point of interpretation it is noteworthy that the Court of Appeal for England and Wales came to a similar conclusion in construing the term “worker” for the purpose of applying the UK Working Time Regulations, which transposed Directive 93/104/EC in that jurisdiction. InRedrow Homes (Yorkshire) Ltd v WrightIRLR 720, (which does not appear to have been cited in the BATU case) a number of bricklayers employed “on the lump” sought holiday pay pursuant to the Regulations. In order to succeed it was necessary for them to come within the definition of “worker” contained at Regulation 2(1), which provides in relevant part: -,
- “Worker” means an individual who has entered into or works (or where the employment has ceased, worked under) –
The Court of Appeal held, on analogous reasoning to that of Murphy J, that as the claimants entered into and worked under a contract to perform work personally they were workers and it mattered not whether the contract was one of service or for service.
Those working for the Respondent provide their services personally. Even if they are engaged on a contract for service, as contended for by the Respondent (and not on a contract of service as claimed by BATU) they are nonetheless workers within the meaning of the Industrial Relations Acts 1946 to 2004 and are thus encompassed by the Agreement. It follows that the Respondent, to whom they provide their services, must be regarded as their employer for the purposes of the Agreement and is thus liable to provide the workers with the benefits prescribed by the said Agreement.
Application for a Stay
The Court has considered the submissions of Counsel for the Respondent in which she urged the Court to stay its decision until the appeal in the BATU case is determined. The Court is not prepared to accede to that request. The law is as formulated by the High Court and as long as it remains the law it must be followed and applied by this Court. Moreover, there is no indication as to when the appeal will be heard and if the Court were to stay its decision the workers who are the subject of this complaint would be deprived of pension assurance and sick-pay cover for an undetermined period.
For all of the foregoing reasons the Court is satisfied that the complaint herein is well founded. Having so found the Court will adjourn a decision on the appropriate order to make for one month so as to allow the parties an opportunity to reach agreement in light of this determination.
Signed on behalf of the Labour Court
22nd December, 2005______________________
Enquiries concerning this Decision should be addressed to Madelon Geoghegan, Court Secretary.