IER is published by Sky Publishing, and has been servicing this specialised sector for over 49 years. IER will be published bi-monthly for here on, the run for the remainder of the year 2011 will be:

 May / June										Copy Date May 27th
 July / August										Copy Date July 8th.
 September / October								Copy Date September 9th
 November / December								Copy Date November 11th
 IER Exhibition Planner 2012						Copy Date November 11th. 
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Features 2011

May/June					Cables and Cable Management
July/August				Heating and Cooling, Interior, Exterior and Emergency Lighting
September/October			Switchgear and Enclosures, Drives and Controls, UPS, 
						Surge Protection and Lightning Protection
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All advertisers may additionally avail of editorial coverage, so do please ensure to contact either Pat Codyre, Hilary Drumm or Avril Smith, on 00 353 1 283 6782, to discuss your specific requirements.

Our Circulation breakdown of 3,500 copies includes;- Member Companies of: Electrical Industries Federation of Ireland (EIFI), Electrical Manufacturers and Distributors Association (EMDA), Association of Electrical Wholesalers (AEW), Electrical Contractors Association (ECA), Association of Electrical Contractors of Ireland (AECI), Register of Electrical Contractors of Ireland (RECI), Electrical Contractors Safety and Standards Association (ECSSA), Chartered Institute of Building Services Engineers (CIBSE), Association of Consulting Engineers of Ireland (ACEI), Electro-Technical Council of Ireland (ETCI), Fegime Ireland.

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Latest News - June 2011

DTT Switchover: “Department is Developing Plans to Assist Vulnerable Households”

The day finally arrived on Thursday 26th May when Ireland’s free-to-air digital television service, Saorview, was officially launched by RTÉ, with Minister for Communications, Energy and Natural Resources, Pat Rabbitte TD, doing the honours.

IER-Retail asked the Department if the Government proposed to assist households in financial difficulty towards the cost of the switchover to digital terrestrial television, perhaps through a voucher system. The Department replied: “Experience from other European countries indicates that the cost of set top boxes reduces as the date for digital switchover approaches, and there is increased competition in the market. It is envisaged that there will be a plentiful supply of simple to use, accessible and affordable set top boxes available on the market as well as a wide range of digital televisions and digital video recorders.

“The Minister is keenly aware of the challenges that the switchover to digital TV will bring, in particular for Irish households which are reliant on the analogue network. To overcome these challenges, the Department is currently developing plans to ensure that a range of practical assistance is made available, in particular, to address the needs of vulnerable households as they prepare to go digital.
“In this context, the expertise and local knowledge of the many voluntary and charity organisations around the country will be of critical importance to ensuring the success of the switchover process. The Department will ensure that, to the greatest extent possible, these organisations play a major part in our information campaign.”
This generalised response can be interpreted in many ways, but IER-Retail’s best guess is that it means: “No, we are going to leave that to voluntary and charity organisations.”

Government Campaign
Asked by IER-Retail about the forthcoming campaign, the Department said:  “The Department was given an initial current allocation of €1.5 million in the 2011 Budget for issues relating digital switchover. The specific allocation for 2012 will be considered as part of the Government’s Budget 2012 process later this year.
“The Department is currently undertaking a public procurement process with a view to engaging the services of a marketing agency for the purposes of developing the digital switchover information/media campaign and providing certain helpline services. The results of this process will not be known until the start of July 2011.
“The campaign will begin later in the autumn and details of media plans will be available at that stage.”

Saorview

 

Saorview
Saorview is now available to 97% of Irish households and carries eight Irish channels, a new enhanced digital RTÉ Aertel information service, and all of RTÉ’s radio services (see panel).
Mary Curtis, Director of Digital Switch Over, RTÉ, said: “This is an exciting time for TV viewers. The new digital service offers more choice when it comes to TV channels and radio channels and it also offers higher quality pictures and sounds. Most importantly, Saorview offers this new service on a free-to-air basis, which means that there is no monthly cost to consumers. To receive Saorview viewers will need to purchase a set-top box, but after that there is no charge.”
Responding, Minister Rabbitte said: “My aim is to ensure that there is a free television service available to all Irish viewers after analogue switch off in 2012 – for which a precise date will be announced later this summer.
“I would like to congratulate RTÉ and in particular Mary Curtis and the Saorview team for their hard work which has made this launch possible. I would also like to congratulate Mick Kehoe and his team at RTÉ Networks Limited who have done a very good job of building the network in such a short space of time and in all weather conditions.
“The move to digital TV is also expected to have positive implications for the availability of Irish broadcasting services in Northern Ireland. The MOU signed in February 2010 between the Irish and UK Governments provides for RTÉ and TG4 to be carried on the digital TV network throughout Northern Ireland. This provides for Irish channels to be broadcast throughout the island of Ireland for the first time in the history of the State.

October Campaign
“I and the Government are keenly aware of the challenges this initiative brings for our fellows citizens. The changeover period is significantly shorter than in any other European country and while this assists broadcasters it may present a challenge for households. To overcome these challenges we must all work together in fulfilling our obligations, we must assist people with information and practical assistance to ensure that no one is left behind as Ireland goes digital.
“In order for this to happen I have promised to deliver a substantial information campaign providing households with information on the digital switchover and on their options for going digital. This information campaign will start in October.

Manufacturers and Retailers
“I look forward to RTÉ and RTÉNL working intensively with manufacturers and retailers to ensure that there is a plentiful supply of simple to use, accessible and affordable set top boxes available on the market, as well as a wide range of digital televisions and digital video recorders.
“I have recently met with groups representing the disadvantaged, including those with sight, hearing and other physical disabilities. The introduction of digital technologies offers great opportunities to achieve greater inclusion in this area and now is the time to ensure that these opportunities are taken. I know that officials from my Department are actively engaged on these issues and I would urge all relevant broadcasters, manufacturers and retailers to ensure that the issue of accessibility of services is central to their work at this time.

Vulnerable Households
“I and my Department are also working towards addressing the particular needs of vulnerable households as they prepare to go digital. In this context, the expertise and local knowledge of the many voluntary and charity organisations around the country will be of critical importance to ensuring the success of the switchover process. I have asked my Department to ensure that, to the greatest extent possible, these organisations play a major part in our information campaign.”

Current Saorview Channels

Television
RTÉ One
RTÉ Two HD
TV3
TG4
RTÉ News Now
3e
RTÉjr
RTÉ One + 1
RTÉ Aertel Digital

Radio
RTÉ Radio 1
RTÉ 2fm
RTÉ lyric fm
RTÉ Raidió na Gaeltachta
RTÉ Choice
RTÉ Pulse
RTÉ 2XM
RTÉ Gold
RTÉjr
RTÉ Radio 1 Extra

Current Saorview Approved Products

Akura
Finlux
LG
Nordmende
Samsung
Sony
Techwood
Triax
Walker

 

News

MARCH 2011

Hoover Candy Appointment

Mick Green has recently been appointed Sales Director for the Midlands and Western Regions for the Hoover Candy Group. This additional appointment is in support of the existing Sales Directors Des Bradley and Kevin Finn.
Mick has considerable experience in the trade, having spent time with Whirlpool, C&F Quadrant and, most recently, Waterford Stanley Group.
Meanwhile, Hoover Candy has taken the decision to make a further investment in logistics by stocking a core range of some 40 products managed by Caulfield Transport.

 

Indesit Wins European Award

Indesit Company UK’s logistics team has won the ‘Excellence in Application of IT’ category at the European Supply Chain Excellence Awards, held at Grosvenor House Hotel in London.
Indesit’s win comes thanks to an innovative partnership with Masternaut Three X, a specialist in vehicle tracking technology. The software developed is called ‘Track and Trace’, a logistics system that has allowed Indesit to replace a paper-based system with a cutting edge, computerised version that has cut costs and improved efficiency.
The groundbreaking technology provides customers with information on their delivery status, giving them better indications of when the delivery will arrive. The software can also recalculate delivery times, to ensure that times can still be met and can provide the customer with a range of dynamic reports via the web, giving them far more flexibility and up-to-date information on their delivery.
These improvements have led to a 99.5% successful deliveries attributed to Indesit and allowed drivers to cut down their journey by more than 100,000 miles since the launch of system, significantly reducing the company’s carbon emissions.
Karen Slack, Network Manager at Indesit Company UK, said: “Winning this award is recognition of the investment, effort and commitment given by Indesit’s logistics and IT teams to make ‘Track and Trace’ a success.
“We have worked hard to be able to provide our customers with a groundbreaking logistics solution. In winning this award we are among great company, with other winners including Procter & Gamble, Primark, BSkyB, and Boots. The system is part of our commitment to first-class performance and customer service.”

 

Siemens Teams Up with Cooks Academy

Siemens Home Appliances has partnered with Dublin’s Cooks Academy to provide the 450 sq m cookery school with Siemens’ next generation range of innovative and high-performing ovens and hobs. The new purpose-built school on South William Street, Dublin 2, runs more than 60 courses and can accommodate over 70 students and up to 100 for corporate events.
Brian McMenamin, General Manager, Siemens Home Appliances, said: “It is only fitting that Siemens provide world-class cooking appliances in what is a state-of-the-art cookery school. Thousands of students take cooking courses there each year and we are getting fantastic feedback on the usability of the Siemens ovens and hobs.
“Siemens has produced a cooking range that suits any kitchen and lifestyle without compromising on the innovative, style and speed factor. As a company, we continue to introduce innovative technology resulting in multi-functional appliances that meet the demands of all chefs, regardless of cooking skill.”

Cooking Demonstrations
Siemens has had great feedback on the cookery demonstrations that run in the Siemens showroom in Clonshaugh in Dublin, in conjunction with Cooks Academy chefs.
An Easter-themed cooking demonstration takes place on Thursday 24th March and a spring-themed demonstration on Thursday 28th April. Bookings can be made at www.siemensappliancesdublin@bshg.com.

 

 

 

 

 

 

 

 

 

 

 

AECO Advises Non-Co-Operation with EPACE

On 25th August 2010, Chis Lundy, Executive Secretary of the Association of Electrical Contractors (Ireland), had already written to AECI members advising them that: "AECI decided some time ago to obstain from all EPACE activities until such time as EPACE was restructured. Following on from that, the Executive Council decided to advise members not to co-operate with EPACE inspections until further notice.

"It is important to point out that all obligations under employment legislation are still in vogue. Each individual contractor should decide on the best policy for their own business in this regard."

Earlier on 19th August, AECI members had also been advised that: "The AECI's stance on the present REA has always been that, while we agree that a form of REA is essential for our industry, we have continually stated that the present REA requires updating and restructuring . On 15th April 2009 the AECI Executive submitted a revamped REA (based on the current economic climate and modern working practices) to the TEEU, NJIC and ECA. It was unfortunately rejected, out of hand , by the TEEU.

"The AECI feel that both TEEU and EPACE have lost out on a major opportunity to do some good for our industry by taking to task the electrical contractors coming into our State and not complying with the requirements of the REA, which is expected to our members and other Irish electrical contractors".

Supreme Court Appeal to High Court Dismissal

In the second week of August an appeal was lodged in the Supreme Court against the High Court decision last June to dismiss the legal challenge to the REA brought by the Non-Aligned Contractors. In a reserved judgement on 30th June 2010, Mr Justice John Hedigan had dismissed the case on grounds including an excessive delay in bringing the proceedings.

Such reviews must be sought within three months of an applicant becoming aware of reasons for doing so, he said. The contractors said they were aware of the employmen agreement in 2003 and no explanation had been given as to why they did not seek judicial review at this time, so their application was well out of time.

At the end of the hearing in the High Court, on 26th March 2010, Justice Hedigan had said that his judgement would not be delivered "until the last day of the next High Court term" - partly due to "late subsmissions" by counsel for the Labour Court and the "complex issues" involved in the case.

On 12th August, the NECI had commented: "This appeal process will take in excess of one year to come to its conclusion and it is unfortunate that, because of the existing unrepresentative agreement, many jobs will be lst and many small electrical contractors will go to the wall beacuse they cannot comply with its unsustainable requirements. NECI will do its best to support its members and we are still confident that right will win out in the end. It is a pity that the Supreme Court decision will come too late for many contractors, as they will be out of business by the time its outcome is known".

NECI Statement

In its statement of 7th September 2010, the NECI said: "In August 2009, a report was commissioned by the then Tanaiste and Minister for Enterprise, Trade and Employment to enquire into and report on matters in the dispute (excluding pay) between the union representing electricians and employers in the electrical contracting industry.

"The enquiry followed a one-week strike and was undertaken under Section 38(2) of the Industrial Relations Act 1990, which provides that: "Where the Minister is of the opinion that a trade dispute is of special importance, he may request the Commission or Court or another person or body to conduct an enquiry into the dispute and to furnish report to him on the findings".

"Mr Peter Cassells and Mr Finbar Flood were appointed by the Minister to carry out the report. The report was completed in December 2009 and the main recommendatons include:

Reform of the unregistered Electrical National Joint Industrial Council (NJIC) to afford representational rights to any permanent body which is representative of employer interest in the sector.

The REA should be reviewed, updated and rewritten by the reformed NJIC to reflect the reality of the changed cicumstances of the industry . Under this section the report also states:"Consideration should be given to the application of the agreement to differentiate by siz of firm, size of contract or type of work (e.g domestic, industrial , commercial)".

Enforcement of the REA and promotion of adherence to emplyment standards within the sector should be undertaken by the National Employment Rights Agency (NERA)

"Despite NECI informing the Department of Enterprise, Trade and Employment in January 2010 that it was happy to proceed with the full recommendations in the Cassells/ Flood report, no change has been implemented and NECI is still excluded from the decision making process. In the meantime, small electrical contractors who mainly employ three or four electricians find that their business has become unviable because they are legally obliged to apply the terms of an outdated Registered Employment Agreement, which they are excluded from having any input into.

"NECI now call on Minister O'Keefe to force the trade union and the other employer bodies in the industry to immediately apply all recommendations contained in the report before any further damage is done to our members. The obvious question arises: "What is the point in the Department of Enterprise, Trade and Employment commissioning a report if no action is to be taken to apply its recommendations?"

"In the absence of any action, NECI would now respectfully inform the Minister and the Labour Court that its members will no longer apply any of the terms of the Registered Employment Agreement into which we are allowed no input. We will also proceed to instruct all electrical contractors to ignore any summons or recommendations produced by the Labour Court. It is already too late for many: NECI know of 12 electrical contracting firms employing 56 people who have ceased trading in the month of August. There have also been a number of suicides resulting from the pressures being applied by a trade union and the Labour Court to pay back moneys, under an agreement many contractors knew nothing about.

 

MARCH 2010

High Court Judgement on REA Postponed

In the High Court on 26th March 2010, Mr Justice John Hedigan said that his judgement regarding the Registered Employment Agreement for the electrical contracting industry would not be delivered “until the last day of the next High Court term” – partly due to “late submissions” by counsel for the Labour Court and the “complex issues” involved in the case.

On 31st March, the Association of Electrical Contractors (Ireland) wrote to its members stating: “Despite strong anticipation by others that a judgement was about to be declared on Friday 26th March 2010, AECI was of the opinion (and in hindsight rightly so) that the judgement would more then likely go on until late May 2010 or later.

“AECI has always declared that the present REA requires a total restructuring. However, regardless of which way the judgement goes, it would be foolish to think that the electrical industry could carry on without a new agreement being structured, i.e. a new REA.”

On its website, the National Electrical Contractors of Ireland said: “NECI are concerned that this delay will further damage many contracting companies who are unable to adjust their business model to ensure survival because of the agreement. This lack of flexibility is causing job losses during the current difficult trading conditions.

“A serious recent development is a massive increase in the sub-contract culture which has the effect of shifting the onus to comply with the REA down the line. NECI are confident that the current challenge will ultimately be successful, thereby allowing electrical contractors to regain control of their own business.”

Neither the ECA nor the TEEU websites posted any comment on the High Court sitting of 26th March.

NEWS · 30th November 2009

Labour Court Adjourns REA Hearing

When the Labour Court convened on Friday 27th November to hear an application made by the Electrical Contractors Association and the Technical Engineering and Electrical Union to vary the Registered Employment Agreement by increasing the wage rates, the Court began by considering applications for an adjournment – and decided to adjourn the hearing for mention on Friday 18th December 2009.

Chairman Kevin Duffy said: “There will be no hearing on that day. It will be a review of the situation as it then exists. The Labour Court will consider if it will proceed and, if so, how it will proceed.

“Hopefully by that date the High Court hearings will be completed and we may have the Ministerial report into the industry, or know when it will be completed.”

Responding to earlier submissions by Counsel for the Non-Aligned Contractors and for the National Electrical Contractors of Ireland that they had difficulties with Kevin Duffy chairing the hearing because he was to be a witness for the Labour Court, which was “defending the High Court challenges vigorously”, he also said: “Another Division of the Labour Court may take the matter up.”

NAC

Applying for an adjournment to the hearing, Counsel for the NAC said that three sets of proceedings were due to commence in the High Court on the following Tuesday (1st December) and were down for two weeks. “This proximity prejudices our clients in that it would require their legal representatives to be in two places at once.”

In its 26th February 2009 determination the Labour Court had refused an application to increase the wage rates. Following subsequent referral of the matter from the Labour Relations Commission, the Labour Court considered the matter further on 11th July 2009 and issued a non-binding recommendation that: “The rates of pay currently prescribed in the REA be adjusted in two phases as follows:

· Phase 1: With effect from 1st September 2009 – An increase of 2.5% on each point of the scale

· Phase 2: With effect from 1st January 2010 – An increase of 2.4% on each point of the scale

In addition, following rejection of this recommendation on 22nd July by the Association of Electrical Contractors (Ireland) by a four-to-one majority, on 23rd July the Tanaiste and Minister for Enterprise, Trade and Employment, Mary Coughlan TD, had announced the establishment of an independent investigation by an expert group into the electrical contracting industry.

Counsel for the NAC said: “In the interim period after the Labour Court’s decision on 26th February not to recommend a pay increase, we had an electricians’ strike and worsening economic conditions – so what made the Labour Court change its mind? An increase has already been recommended by the Labour Court in July, so there is no question but that there is bias of this public hearing. My clients were excluded from a meeting held on 25th November and we were informed by the Labour Court that information that we sought was confidential and that the Court was not able to release it. The Labour Court also admitted that there was no other way than to have the issues considered in the Labour Court.

“In addition, while I am not sure at what stage the Minister’s investigation into the industry is at, obviously it would be beneficial if that was concluded before the application (to vary the REA) is considered.”

Responding, Chairman Kevin Duffy said: “There was no meeting, there was a hearing. You were not excluded, you were not a party to the trade issue. The recommendation was addressed to the three parties to the REA. All parties would not have to pay it – it was a recommendation. The REA hasn’t been varied, and will not be until the Labour Court accepts an application to do so.”

TEEU

Owen Wills, for the TEEU, claimed that the NAC’s application for an adjournment was “an abuse of this Labour Court” and said: “We are totally opposed to an adjournment”.

ECA

Jean Winters, for the ECA, said: “We would also apply for an adjournment, due to the forthcoming High Court hearings and because the Department’s report is not yet published.”

NECI

Counsel for the NECI supported the points made by the NAC for an adjournment and, in addition, said: “The absence of any negotiating license has not been addressed and is a continuing issue. We want an answer as to where the AECI and ECA get their powers to negotiate.”

Kevin Duffy replied: “I am not sure that we can help you on that. I can’t see that we can deal with it.”

When Counsel for the NAC then supported the NECI’s issue about negotiating licences, he added: “You can make an application about this at an appropriate time.”

AECI

After Kevin Duffy had asked: “Could we adjourn for, say, two to three weeks?” Jack Hegarty, for the AECI, said: “I would agree to an adjournment for two to three weeks. The AECI is supporting the ECA’s request for an adjournment.”

 

AECI Seminars for Electrical Contractors and Wholesalers

Neil Steedman, IER Features Editor, report

The Association of Electrical Contractors (Ireland) is holding a series of one-day seminars on:

The venues and dates are:

Each seminar will take place from 9.00am – 4:30pm and the fee of €150.00 (AECI members) or €175.00 (non-members) includes tea/coffee and biscuits during the day and lunch at 1.00pm.

Due to the recent changes, including cable etc, to I.S.: 3217 2008: Emergency Lighting Systems and to I.S.:3218 2009: Fire Detection and Alarm Systems, this one-day seminar has been arranged to highlight good electrical practice and the responsibilities of the electrical contractor, including health and safety issues.

A limited number of spaces are available, so contact Lenka at the AECI Head Office for a booking form as soon as possible, or visit www.aeci.ie for further information.

 

News · 25th July 2009

Tanaiste Announces Independent Investigation into Electrical Contracting Industry

Neil Steedman, IER Features Editor, report

On Thursday 23rd July the Tanaiste and Minister for Enterprise, Trade and Employment, Mary Coughlan TD, announced the establishment of an independent investigation by an expert group into the electrical contracting industry, with details of its membership to be announced later.

This followed the rejection on Wednesday 22nd July by the Association of Electrical Contractors (Ireland) – by a four-to-one majority – of the non-binding Recommendation issued by the Labour Court on Saturday 11th July. This had proposed a 4.9% wage increase on each point of the scale in two phases, comprising 2.5% from 1st September 2009 and 2.4% from 1st January 2010.

The National Electrical Contractors of Ireland had welcomed the AECI’s rejection of the Recommendation, describing it as a “ballot of reality”.

Earlier, at a meeting on Wednesday 15th July, the Electrical Contractors Association had voted to accept the Recommendation, while the Technical Engineering and Electrical Union had accepted the Recommendation on 12th July, albeit “reserving our right to reactivate our industrial action and pursue our all-out picket application to the ICTU vigorously if required”.

Chris Lundy of the AECI told IER: “We have around 300 members, of whom 200+ are paid-up members entitled to vote and 78% of these did so, with just under 80% voting to reject the Labour Court Recommendation. The next steps will include a meeting of the NJIC on Tuesday 28th July, when meetings with the AECI have also been requested by Owen Wills of the TEEU and by the Labour Court.”

Jean Winters of the ECA told IER: “Almost all of our 50 members attended a meeting held on 15th July in accordance with our regulations and a clear majority voted in favour of accepting the Recommendation.” Earlier, when responding to the TEEU’s threat of strike action, the ECA had described the pay claim as “completely unwarranted” and said: “Companies in the ECA cannot afford to pay the increases being sought from the TEEU. Pursuing this action will put jobs at risk.”

TEEU General Secretary Designate, Eamon Devoy, said: “Given the current situation which now exists with the rejection of the LRC proposals and Labour Court Recommendation by the AECI, the industry is facing a return to industrial action. However the TEEU will give reasonable space and time to all parties to overcome the current difficulties before making a decision.” TEEU General Secretary Owen Wills later welcomed the Tanaiste’s announcement of an independent investigation, adding that it had to be “focused, intense, and completed within a month”, and said that he would recommend that the Union “defer any industrial action until completion of the investigation”.

Labour Court Recommendation

The Labour Court Recommendation (see below in full) had been made following three days of talks between the ECA, AECI and TEEU at the Labour Relations Commission. The talks were undertaken with a view to resolving the week long strike called by the TEEU, and held from 6th-10th July, in relation to its claims for pay increases totalling 11.3% under the Registered Employment Agreement – 4.9% from 1st April 2008 and, according to the Union, 6.4% from 1st April 2009.

In relation to the 4.9% claim, the Recommendation states: “The increase was not applied at the due date because of legal interventions by certain parties outside the Joint Industrial Council for the Industry. The employers involved in this dispute freely agreed to that increase. They now fully accept that were it not for those interventions the increase would have been implemented on the due date and would now be fully integrated in the pay of electricians within the industry.”

This is, to say the least, disingenuous. After a 13-day hearing earlier this year, the Labour Court itself had refused to register the 4.9% claim in its determination of the TEEU’s application because both the ECA and AECI, which had previously agreed the increase, had not only stated during the hearing that they could no longer afford to pay the increase but also that they were seeking a 10% decrease. In its determination the Labour Court had stated: “In the circumstances in which the application to vary the Agreement does not have support from the employer bodies which are party to the Agreement the Court does not consider it appropriate to make an order varying the Agreement. Accordingly the application is refused.”

The Labour Court’s recent Recommendation also makes no reference to the issue of negotiation licences for the ECA and AECI and hence the legitimacy of the NJIC and REA. In its earlier determination the Labour Court had signalled its concern about this issue by making the following recommendation on representation: “It is clear that the question of representation of employers in negotiation on the REA is a matter of some controversy. It is noted that negotiations are currently conducted through the NJIC for the industry. This is not a registered NJIC within the meaning of Part V of the Act of 1946. Its composition appears to have been established prior to the registration of the REA. The Court recommends that the parties consider applying to the Court, pursuant to s.61 of the Act, to register the Council. Since s.65 of the Act provides that a Registered Joint Industrial Council is an excepted body for the purposes of the Trade Union Act 1941, as amended, registration of the Council would overcome any difficulties which might otherwise arise by the participation in negotiations of bodies which are not the holder of a negotiation licence.”

If this issue is not clarified in the next few weeks, it is likely to be a matter of legal argument when the High Court judicial review of the electrical contracting industry REA, granted to the group of Non-Aligned Contractors, is held in the next session, possibly in September.

The High Court may (and hopefully will, but will probably not!) require all three employer parties – the ECA, AECI, and NECI – to provide independently audited figures of their paid-up memberships and numbers of electricians employed, and the TEEU of their paid-up members working in the electrical contracting sector.

Statements Issued

The following statements were issued by the AECI, TEEU and NECI:

AECI

“AECI members have voted by a large majority to reject the recommendations of the Labour Court for a 4.9% wage increase, paid over two phases, for the electrical contracting industry. Members are adamant that it would be impossible to recover these costs increases from their customers, in the current economic climate, and that electrical contractors would not be in a position to carry these costs themselves. All businesses are under immense financial pressure at this time and our members are no exception to this position, with requests for 10% to 25% reductions in charge-out rates now becoming the norm.

“Electrical contractors are locked into fixed price contracts going forward to the end of 2010, and in the case of Government contracts prices are fixed for 42 months. It is clear from the feedback from AECI members that no wage increase can be afforded until the Government addresses the issues of pre-qualification, fixed price tendering, non-compliance with the REA, and electrical contractors from out of State who seemingly can operate in this country at a fraction of the costs incurred by compliant local electrical contractors.

“Members have also expressed the view that any alteration in wage rates must be part of a review of the conditions of the REA.

“AECI wishes to appeal to all parties to get back to discussions and give sufficient time to arrive at a solution that will be beneficial to everybody involved and for the good of the country at large in these difficult times. For AECI’s part, we will be available at all times to discuss these matters with the appropriate bodies and hope that a long-lasting solution acceptable to all can be worked out.”

TEEU

“We see the Labour Court Recommendation and the Labour Relations Commission proposals we accepted and the Electrical Contractors Association accepted as offering a solution to the complicated differences that arose between all the parties in the industry over a very lengthy period of time. The TEEU will have to reflect, with others, on the implications that the AECI decision will have for the industry. “We are immediately calling on the Tanaiste and Minister for Enterprise, Trade and Employment, Mary Coughlan, to initiate an immediate investigation into the industry proposed as part of the process to resolve the dispute. That investigation is now more essential than ever and cannot be delayed any further, especially as the resolution of some of the issues is not in the gift of the parties to the Registered Employment Agreement to resolve. Some of the problems involve external interference in the industry and the undermining of the activities of legitimate and compliant companies and electricians.

“Given the current situation which now exists with the rejection of the LRC proposals and Labour Court Recommendation by the AECI, the industry is facing a return to industrial action. However the TEEU will give reasonable space and time to all parties to overcome the current difficulties before making a decision.”

NECI

“By now it should be clear to all that any agreement that deems it compulsory for all electrical contractors, large and small, to operate their companies under the same business model is flawed from the outset.

“NECI identified this issue and called it out loudly and clearly to the Labour Court, back in 2008. For the last 12 months, during which time our industry has been devastated, NECI has been pushing as hard as it possibly can to get the message across, to the industry, to the Union, to the other employer associations and to senior Government Ministers.

“Any pay increase in the current economic climate is unviable for the small contractor.

“It is obvious now that the minority larger contractors are willing to pay the increase to ensure industrial stability, which is understandable as they can recover the cost of this increase from their customers, which in most cases is the Government (ultimately the Irish taxpayer).

“However, they too may yet find this is a price too high to bear, as the Government has issued edicts to contractors that it is to reduce charges by 8% and “...there shall be no negotiation on the proposed reduction of 8% and it shall apply to all contracts”. In Government letters to contractors, it has been stated that “...a decline in the economy has occurred which threatens the wellbeing of the State...”. Yes, this is a national emergency, and we need to support our industry employers to ensure maximum employment is retained.

“It is difficult to understand how the Labour Court recommended this 4.9% increase in the first place, particularly when they were presented with evidence that electricians are paid 3% more than all other construction craft workers and the same increase was rejected by the same chairman of the same court in February of this year.

“NECI would also take this opportunity to point out that a member of the Labour Court who had input into the 4.9% recommendation was removed from the record-breaking 13-day hearing held in January 2009 for meeting outside the Court with the TEEU representative.

“We are horrified at hearing yet again this phrase by the TEEU: “What we have we hold” in their response to the An Bord Snip report, as it is this same mantra that the Union has been repeatedly reciting over the last 19 years, in relation to any change to the Registered Employment Agreement and their unwillingness to change these terms for the betterment of both employers and employees, within the sector. Their mindset has forced an industry to become so uncompetitive beyond all realism, a theme that is being echoed time and again in Ireland, most recently by Element Six today.

“This is the same Union who encouraged their members to vote against the Lisbon Treaty and gloated on their website when it was rejected.

“This Union seems to be in complete denial regarding the effects of the current economic trading conditions and we call upon our Government to use this opportunity to support the small electrical contractor who actually is creating employment and remove any links from the trade unions, who by their intransigence and blinkered attitude are costing jobs at a time we need them most. “We call on the Government to intervene before a strike is reconvened, which will threaten the stability of the nation and damage further our reputation internationally.”

Labour Court Recommendation

On Saturday 11th July the Labour Court issued the following Recommendation on the TEEU’s pay claim:

Background

This dispute came before the Court against the background of a nationwide strike by members of TEEU in furtherance of a claim for a pay increase, which, they contend, is outstanding under the terms of the Registered Employment Agreement for the Electrical Contracting Industry. The dispute is between the parties who are represented on the National Joint Industrial Council for the Electrical Contracting Industry.

The dispute has been the subject of extensive conciliation at the Labour Relations Commission extending over three days. Substantial agreement has been reached in that process on a range of issues in contention between the parties. However, final agreement was not reached on the Union’s pay claim. At the request of the parties, that question was referred to the Court by the LRC under section 26(1) of the Industrial Relations Act 1990 for investigation and recommendation.

Following the conciliation process the LRC issued proposals in the following terms:

“Further to the most extensive conciliation possible in this dispute the Labour Relations Commission puts the following proposal forward to resolve the issues in dispute and to bring the current industrial action to an end. The Commission understands that all parties referred to above are prepared to accept this proposal as a resolution of the current dispute.

Settlement Proposal

Commission, the Commission will proceed to refer the matter to the Labour

Court for non-binding arbitration in accordance with section 26(1) of the Industrial Relations Act, 1990. This referral will take place immediately.

The Commission puts this proposal in the interest of securing stability in this critical industry and strongly encourages all with a capacity to contribute to this resolution to do so in the national interest. In making the proposal the Commission notes the desire of all parties that an independent review of the dynamics of the industry and how they have contributed to this dispute and the difficulty in finding resolution be carried out. This is critical to the orderly conduct of relationships between the parties into the future.

The Commission also notes the clear commitment of all parties that no victimisation or recrimination will occur arising from this dispute.”

The Court investigated the dispute on Saturday 11th July 2009. The Court received comprehensive submissions from the parties on the issues involved. The following is the Recommendation of the Court:

History of Pay Determination

The REA provides its own mechanism for pay determination. Rather than applying national pay agreements directly, pay adjustments are determined by reference to movements in pay in an agreed range of analogous employments. Under that arrangement the pay of electricians in the analogous employments is determined annually, in September each year, and the Joint Industrial Council for the Industry establishes the average basic rate payable in those employments. This rate is then incorporated in the Registered Employment Agreement for the industry with effect from 1st April of the following year. Thus pay is determined on the basis of following movement in the rate of electricians in a representative group of analogous employments. The underlying rationale of this system is that electricians in the electrical contracting industry should be paid no more and no less than the average rate paid to electricians employed in other sectors. The Court is satisfied that this system has worked well over many years and provided both employers and workers with a fair and orderly system of fixing wages in the industry.

Review of the Agreement

Nonetheless, no agreement can remain immutable for all time and account must be taken of changed circumstance that develop over time. In that regard it is noted that the parties have agreed, in the course of the conciliation process, to conduct a thorough review of all aspects of the REA. The Court is satisfied that the parties are fully committed to developing, within that review, all aspects of the REA so as to meet the current and emerging needs of employers and workers in the industry.

The Current Claim

There are two aspects to the Union’s current claim. Firstly it relates to an increase agreed through the review mechanism provided by the REA in September 2007. That increase was due to take effect on 1st April 2008. If implemented it would have amounted to an increase of €1.05, or 4.9%, in the hourly rate of craft workers at each point of the scale. The increase was not applied at the due date because of legal interventions by certain parties outside the Joint Industrial Council for the Industry. The employers involved in this dispute freely agreed to that increase. They now fully accept that were it not for those interventions the increase would have been implemented on the due date and would now be fully integrated in the pay of electricians within the industry. The second aspect of the claim is based on the projected increase which the Union believes would have emerged from the review of rates in the analogous employments had it taken place in September 2008. However, that review has not taken place because of the serous downturn in the sector and other factors. In consequence this aspect of the Union’s claim has not been agreed.

The Approach of the Court

In formulating its recommendations on how the current dispute should be resolved the Court has taken full account of the current economic and employment circumstances of the electrical contracting industry and those of the broader construction sector upon which it largely depends.

The Court has also taken into account the fact that electricians in the industry have not had a pay increase since 2007 and that employers have, in effect, had the benefit of a two-year pay freeze. That period covered, in part at least, a time when the industry was buoyant. Furthermore, in the period in question workers generally, including those in the broader construction sector, received some increases under the terms of either the previous or the present National Partnership Agreements.

Recommendation

In all of these circumstances the Court is satisfied that the Union’s claim, in so far as it relates to the increase, which was due in May 2008 (sic), has merit. However, the manner and timing of addressing that claim must take full account of the current circumstances of the industry.

With regard to the second aspect of the Union’s claim – for the projected value of the review due in 2008 – the Court believes that this should not be pursued at this time. It should be considered, on a without prejudice basis, in the context of the review of the REA proposed by the LRC.

Accordingly, and for the reasons referred to above, the Court recommends that the rates of pay currently prescribed in the REA be adjusted in two phases as follows:

This Recommendation is made having regard to the particular facts and circumstances of this case. It is not intended to have any application or precedent value for any other group or category. Consequently it should not be relied upon or quoted by either employers or unions in any other case.

Other Matters

Finally the Court wishes to place on record its view that, hitherto, the electrical contracting industry has been a model of stable and co-operative industrial relations. This has been due, in no small measure, to the positive and constructive role played by established trade union and employer bodies within the sector. They have, over many years, positively promoted the interest of their respective constituents while maintaining a common commitment to the overall advancement of the industry for the benefit of its clients and those who depend upon it for their livelihood. This has been achieved, to a significant extent, by the maintenance of effective negotiating structures in the form of the National Joint Industrial Council for the Industry and their commitment to the Industry Registered Agreement. The events giving rise to this referral are a regrettable departure from that model.

The agreement reached at the LRC contains a reaffirmation by the parties of their commitment to the REA and the industrial relations structures by which it is underpinned. The terms of this Recommendation, read in conjunction with the substantial agreement reached with the assistance of the LRC, provides the parties with the best opportunity to put the recent events behind them. The Court wishes to urge the parties to use that opportunity to rebuild employer / worker relationships and to develop and strengthen the co-operative structures and agreements, suitably adapted to meet current requirements, so as to meet the challenges that the industry is currently experiencing and to position it to take full advantage of the opportunities for recovery that will undoubtedly arise in the future.

 

News · 11th June 2009

High Court Agrees to REA Judicial Review

On Monday 11th May the High Court agreed to the application made by the Non-Aligned Contractors (NAC) for a judicial review of the electrical industry’s Registered Employment Agreement.

A date for the judicial review hearing has yet to be announced.

REA Revision Proposals

On 26th February 2009 the Labour Court delivered its 77-page determination refusing the applications to vary and to cancel the REA (see www.ier.ie for detailed reports on the Labour Court hearings and the determination).

Subsequent to that, the ECA, AECI and TEEU held meetings at the Labour Court and NJIC. The AECI established a subcommittee to review the REA and asked its members to state what changes they would like to see implemented. A draft revised REA document was produced and has been submitted to the Labour Court, which was expected to present the document to the TEEU at a meeting of the NJIC scheduled for Tuesday 26th May.

The AECI members had also been balloted as to whether they wished the AECI to ‘re-engage’ with EPACE, but a clear majority of those who responded were not in favour.

Meanwhile, the National Electrical Contractors of Ireland (NECI) is to ballot its members in relation to a possible High Court action challenging the Labour Court decision of February 2009 (see 'NECI Says: “Stop the Freefall Now!” in IER’s May/June 2009 issue).

 

NEWS · Thursday 5th March 2009

Labour Court Refuses Both REA Applications

Two Determinations

On the first application, made by the TEEU, for the Court to register a variation in the REA to increase the craft basic rate by €1.05 per hour, from €20.74 to €21.79 (a 5% increase), and with proportional increases applied to other rates, the Court concluded: “In the circumstances in which the application to vary the Agreement does not have support from the employer bodies which are party to the Agreement the Court does not consider it appropriate to make an order varying the Agreement. Accordingly the application is refused.”

On the second application, made by the NECI and NAC, for the Court to cancel the REA in its entirety, the Court said: “Having regard to all the circumstances of this case the Court has come to the view that the changes in the electrical contracting industry since the registration of the REA have not made it undesirable to maintain its registration. Accordingly the Court does not propose to cancel the registration of the Agreement.”

Six Recommendations

The following recommendations have been made for the guidance and assistance of the parties. They do not form part of the Court’s decisions on either of the applications before it.

“Rates of Pay: The Court recommends that the parties to the Agreement resume negotiation at the NJIC on rates of pay, having regard to all relevant considerations, including the terms of the pay agreement associated with Towards 2016 Transitional Agreement 2008-2009, the provisions of the REA itself, and the current economic circumstances of the industry.

“Review of the REA: It is noted that in the course of the hearing all parties to the REA expressed a willingness to review its terms in light of changed circumstances. The Court recommends that such a review should be undertaken as a matter of urgency. Should any issues arise in the course of the review upon which agreement cannot be reached they should be referred to the Court for investigation and recommendation.

“Clarification of the Terms of the Agreement: As part of the review of the REA referred to above, the parties should specify with greater clarity than at present the precise circumstances in which travel and subsistence payments fall due. Any difference on this point should be referred to the Court for interpretation under s.33 of the Industrial Relations Act, 1946.

“Representation: Arising from the hearings, it is clear that the question of representation of employers in negotiation on the REA is a matter of some controversy. It is noted that negotiations are currently conducted through the NJIC for the industry. This is not a registered NJIC within the meaning of Part V of the Act of 1946. Its composition appears to have been established prior to the registration of the REA.

“The Court recommends that the parties consider applying to the Court, pursuant to s.61 of the Act, to register the Council. Since s.65 of the Act provides that a Registered Joint Industrial Council is an excepted body for the purposes of the Trade Union Act 1941, as amended, registration of the Council would overcome any difficulties which might otherwise arise by the participation in negotiations of bodies which are not the holder of a negotiation licence.

“The current parties to the Council should also consider affording representational rights to any permanent body which is representative of employer interest in the sector. Should any issue arise as to the extent to which any body is representative, that issue should be referred to the Court for final adjudication.

“Pensions: The parties to the agreement should make it clear that the obligation imposed on an employer under the Agreement is to provide pension, assurance and sick pay cover up to the specified minimum level of benefits and to ensure that the entitlements under the scheme are transferable within the sector. It should also be made clear that employers are free to obtain cover for these benefits from any source of their choosing provided that benefits and other conditions meet the requirements of the Agreement.

“Enforcement: The Court notes the proposals in the Employment Law Compliance Bill 2008 to place EPACE on a statutory footing under the general aegis of NERA. The Court recommends that all parties co-operate fully with the implementation of this provision.”

Variation Application

While it was widely expected that this application would be refused, it is to be noted that the Court’s conclusion merely refers to the lack of support “from the employer bodies which are party to the Agreement”.

No reference was made either to the other employer groups – who were also opposed to the application – or to the case made by the TEEU that, under the terms of the REA, the analogue system is the only permitted means of determining wage rates and that the increases sought had been correctly determined by this system. None of the employer groups contested this, but all simply argued inability to pay.

The Court made no reference to the analogue system (in relation to the variation application) nor to the fact that there is no ‘inability to pay’ clause, or, indeed, rates of pay negotiation clause, in the REA. On the contrary, the Court “recommends that the parties to the Agreement resume negotiation at the NJIC on rates of pay”.

Cancellation Application

The Court did not accept the TEEU’s contention that only a party to the REA could apply for its cancellation. On the contrary, it concluded that: “s.29 of the (1946 Industrial Relations) Act allows the Court, on its own motion, to consider if the maintenance of an REA on the register is no longer desirable” and also that: “Accordingly the Court is satisfied that the application to cancel the registration of the REA is properly before the Court and that the applicants herein, in so far as they are employers affected by the agreement, have locus standi to maintain the application.”

Going on to consider burden of proof, the Court concluded: “Accordingly the Court is of the view that the applicants must establish, as a matter of probability, that there has been change in the sector, that the change is substantial and that in light of that change it is undesirable to maintain the registration of the REA.”

As regards whether there had been change in the industry since 1990, the Court said in clause 13.1: “That question can be quickly disposed of.” There had obviously been change.

Secondly, in clause 28.1: “The Court has concluded that the sector has experienced substantial change since the REA was registered. The principle manifestations of that change are in respect of the number of entities carrying on business to some degree in electrical contracting, the extent to which the REA is now enforced, the extent of external competition and the decline in activity in consequence of the current recession.”

In clause 29.1 the Court went on to say that: “The question in issue before the Court is whether, in light of this substantial change, it is undesirable to maintain the registration of the REA. No legal test has been suggested by which the Court should determine if the continued registration of an agreement has become undesirable. It is, however, noteworthy that the relevant subsection is expressed in negative terms (the Court must be satisfied that the continued registration is undesirable). This suggests that there must be evidence of some weight to indicate that, because of changed circumstances, the overall or dominant effect of the agreement has become deleterious to the interests of all parties in the sector or that some other compelling reason exists as to why the registration of the agreement should be cancelled. It further appears to the Court that it is for those who assert that it is undesirable to maintain registration to make out a positive case that the greater good of the sector would be advanced by cancelling the registration of the agreement.”

Going on to consider the consequences of cancelling the REA, the Court concluded (clause 30.5): “On balance, the Court is satisfied as a matter of probability that rates of pay would decline in the sector in the absence of the REA. It is further probable that orderly systems of pay determination and dispute resolution, which currently exist within the industry, would be greatly impaired,” and (clause 31.1): “There is little doubt that in the absence of the REA the incidences of pension and mortality cover would decline, or at best, the level and quality of cover would deteriorate significantly.”

With regard to external competition, the Court said (clause 32.3): “In the absence of an REA it is difficult to conceive of any basis upon which the practice of applying a fair wages clause could continue,” and (clause 32.4): “A second and more troubling consequence of cancellation concerns the difficulty that would arise in seeking to enforce locally agreed rates against contractors from other EU Member States.”

The Court did not agree with the applicants’ submission that the Laval case in 2008 at the European Court of Justice, concerning the EU Posting of Workers Directive, as transposed into Irish law by the Protection of Employees (Part-Time Work) Act 2001, means that the REA is not enforceable against an employer of a posted worker.

In clause 2.12 the Court stated: “The point was made in the course of the hearing that it is difficult to enforce the REA against firms from Northern Ireland, which undertake short-term assignments in this jurisdiction. There is considerable validity in that contention. However, the extent to which cancellation of the REA could detrimentally expose the industry as a whole to external competition from contractors established in low wage Member States would, in the Court’s view, far outweigh any benefit that might accrue to contractors who could more easily compete in the cross border segment of the market.”

On employment levels, it stated (clause 33.3): “The Court is not convinced on the evidence that the practice of engaging sub-contractors in substitution for direct employees is a problem of such magnitude as to warrant cancellation of the REA. Nor is the Court convinced that even if the REA were to be cancelled it would necessarily ameliorate that problem where it exists.”

Finally, in section 34 the Court considered the capacity of small firms to comply and the feasibility of a new REA being concluded that would take account of the particular needs of small business.

In clause 34.3 it said: “The Court accepts that there is validity in the arguments advanced on this point. However, in deciding the question before it the Court must seek to balance the interest of all parties involved in the sector. The Court is satisfied, on the balance of probabilities, that the cancellation of the agreement would bring considerable disadvantage to workers in the sector, of which there are at least 12,000, and to the employers who employ a significant body of these workers. There is no mechanism by which the Court could exempt certain categories of employer from the scope of the agreement, even if it were to conclude that such a course was either desirable or necessary. The Court must either conclude that the continued registration of the agreement is desirable or undesirable. In so doing it must be guided by where the balance of advantage lies between conflicting interests, not just between workers and employers but also between different classes of employer.”

In clause 34.4 it said: “Nothing tangible has been put forward to suggest how a new agreement might be negotiated between disparate and in some cases unassociated employers and the Trade Union. Nor were any firm proposals put forward as to how a new agreement might be structured so as to accommodate the different interests within the sector. It is theoretically possible that arrangements could be put in place whereby small firms, measured on employment levels, would not have the same obligations to their employees as larger firms or that small firms could be exempted from the scope of any agreement.” However, clause 34.5 included: “Such an approach would present clear difficulties in practice and in principle…Finally, it seems clear to the Court from the evidence adduced on the point that this approach is unlikely to find favour with either the TEEU or the employers of the majority of its members in the sector.” Clause 34.6 concluded: “While the Court accepts that small firms operating in the domestic and related segments of the sector have particular difficulties in meeting the terms of the REA, the cancellation of the registration of the agreement on that account alone would be a disproportionate response.”

Overall, therefore, the Court determined that, while there has been substantial change in the electrical contracting industry since the REA was registered in 1990, that change has not made it undesirable to maintain its registration.

Specific Issues

A few statements, errors and omissions made in the determination are worth highlighting:

Representation:

It is significant that the Court recommends that the parties to the NJIC register the Council as this “would overcome any difficulties which might otherwise arise by the participation in negotiations of bodies which are not the holder of a negotiation licence”.

EPACE:

Under clause 7.19, the Court reveals something of the private session held during the hearing into EPACE inspections: “Evidence was given that firms were selected at random for inspection by EPACE. A list of inspections conducted by

EPACE of ECA member firms was furnished to the Court and Ms Vega was tendered by ECA to explain this list. It was put to Ms Vega that there was no record relating to the inspections conducted of a number of major contractors named on this list nor was the outcome of those inspections given. It was also pointed out that there was no record of inspections carried out on Northern Ireland firms. Ms Vega said that she had only been asked to supply records of inspection of ECA members. She accepted that the record relating to those firms was incomplete.”

It is also to be noted that in clause 3.16 on EPACE the determination states: “Its sponsors are TEEU, ECA and AECI. It now operates as an independent body although its management committee is made up of representatives of the sponsoring bodies.” However, this is not correct. While the AECI were involved in the initial establishment of EPACE, it later withdrew and currently has no involvement with the body – albeit that the AECI is currently balloting its members on whether it should ‘re-engage’ with EPACE.

Pension Scheme:

Referring to Section 23 of the REA, the Court’s determination, in clause 5.2, states: “The REA also requires employers to whom it relates to enter employees between the ages of 20 and 65 in a pension, sick pay and mortality scheme providing benefits not less favourable than those provided for by a scheme known as the Construction Workers Pension Scheme (CWPS).” However, it does not mention that Section 23 of the REA also states: “In this connection each employee between the age of 20 and 65 years to be entered in the Construction Federation Pension and Mortality Scheme”.

But the determination does state in clause 20.6 that: “The Court does believe, however, that it is incumbent on all parties to avoid any suggestion that a particular pension provider is to be preferred over another.” The Court also addresses the current monopoly position of the CWPS in its recommendations.

Apprentices:

In a brief section on apprentices, the determination refers to claims of abuse of apprentices in the industry and states (23.1): “The Court was told that a ratio of one apprentice to two electricians is operated within the industry.” The fact that it was told this (by the TEEU) is correct, but the statement itself is incorrect on two grounds – firstly, the ratio was two apprentices to one electrician, and secondly, this ratio is no longer specified within the REA.

Although the determination refers twice in other contexts to the AECI’s 2005 submission to an Oireachtas Joint Committee, section 23 makes no reference to the assertion in that submission – and referred to by at least two witnesses in the 2009 hearing – that up to 17,000 electrical apprentices had been registered by FAS since 2000. One has to wonder what the Labour Court thinks has happened to all those apprentices because it claims, in clause 16.3, in relation to the DKM Consultants report figure of 31,200 electricians and electrical maintenance fitters, that: “The Court finds it difficult to reconcile this figure with the evidence given in the course of the hearing.”

What Next?

The three parties to the NJIC – the AECI, ECA and TEEU – had a formal meeting last week and are to meet informally on Tuesday 10th March to discuss how they proceed in the light of the determinations of the Labour Court and the AECI’s and ECA’s expressed wishes to renegotiate aspects of the REA.

The NECI held its first agm last Saturday 28th February and launched a new pension scheme exclusive to its members which it claims “offers a better return, larger death in service payout, and far superior sick and illness cover than anything else available on the market…and offers substantial immediate savings on the employer contribution.”

The NECI also issued a statement (prior to the Labour Court announcing its determination) that: “It is most undesirable to retain registration of this agreement as it is detrimental to both employment and competitiveness within the industry. The current hearing in the Labour Court has the ability to cancel the agreement, but failing this outcome NECI will proceed with its challenge on behalf of 600+ members and work tirelessly to achieve its goal.”

The NAC also has a judicial review pending in the High Court.

So the Registered Employment Agreement for the electrical contracting industry is likely, at the very least, to be significantly revised – and its continued existence may yet have to be determined by one or more High Court cases.

 

News · Tuesday 17th February 2009

Labour Court Receives Final Submissions
– Decisions Expected Later This Month

Neil Steedman, IER Features Editor, reports.

The Labour Court hearing into two applications concerning the electrical contracting industry’s Registered Employment Agreement heard the final verbal submissions by the representatives of the five bodies participating (TEEU, ECA, AECI, NAC, and NECI) on Wednesday 4th February. Monday 16th February was set as the deadline for receipt of final written legal submissions.

At the conclusion of the public hearing, the Chairman said: “This has been an unprecedented hearing for the Labour Court. I don’t think it has ever sat for as long on any other issue – and I hope we never have to do so again! We will await your written submissions until we come to consider and decide – and we are confident to say that we will have decisions by the end of this month.”

Two Applications

The Court is considering two applications: the first, made by the TEEU, is for the Court to register a variation in the REA to increase the craft basic rate by €1.05 per hour, from €20.74 to €21.79 (a 5% increase), and with proportional increases applied to other rates; the second, made by the NECI and NAC, is for the Court to cancel the REA in its entirety.

(See IER website posting of 19th January 2009 for summary of events from Monday 12th to Friday 16th January, and the posting of 30th January, updated 6th February 2009, for summary of events from Tuesday 20th to Monday 26th January.)

Court Recommendations?

Prior to inviting the representatives to make their final verbal submissions, the Chairman, Kevin Duffy, indicated that the Court has been considering the possibility of making recommendations, in addition to making decisions on the two applications before it. However, it would not be inclined to do so “unless there was general agreement” to this approach – he invited the parties to make comments in their written submissions and noted that the representatives “may need to take instructions on the point”. Any such recommendations made by the Court would not be binding on the parties.

Stating that Section 29 of the Industrial Relations Act, 1946, empowers the Labour Court to either retain or cancel an REA, the Chairman added: “But it doesn’t go further than that. Would the Court make recommendations and set out its opinion on consequential actions? We are used to making recommendations to industrial relations parties, but there is nothing on this in the Act.”

TEEU

The TEEU representative said: “There are two things to address: legal issues and industrial relations issues. Do the NECI and NAC have any legal standing in this Court? My contention is that under the 1946 Act only a party to the REA can apply for its cancellation – neither group can apply for a variation, for example. If the Court decides that it can consider their application, the onus of proof is on them proving that there has been substantial change such that it is undesirable to maintain the REA. All the evidence before this Court is that there has not been substantial change. The reality is that there has been increased policing, and it is clear that it would be very, very undesirable to bring down the agreement. Protections would disappear.

“There has been no suggestion that existing groupings are no longer substantially representative of the industry. Mr Wills’ figures of 10,000 TEEU members out of 12,000 electricians employed in the industry have not been challenged.

“Disputes over the past 19 years have been resolved peacefully with the REA, which continues to provide common terms and conditions to maintain a level playing field.

“The Laval case is a complete red herring – and the European Court of Justice acknowledged that a member country may apply collective agreements. Nor does the Gama/BATU case of April 2005 apply – the injunction had no effect whatsoever on the construction industry REA, albeit that wage variations were suspended.

“Now we get to the point of what happened in this room over the last few weeks. The NECI says it represents a large number of employers, without providing specific evidence. Most of the NECI team have made assertions that are bogus or show uninformed opinion of the REA. The September 2003 mailout stretches the credibility of contractor witnesses that gave evidence that they were not aware of the REA.

“The opponents of the REA only represent 10% of the industry under any fair validation of their numbers – and they wish to dictate to the other 90%.

“The proposed change is in conformity with the REA under the analogue system.

“For all these reasons, the issues about the REA and the arguments put before this Court stretch credulity to breaking point. Within the industry itself, at the ENJIC, is the best place to determine any issues raised. To bring down this agreement would cause severe hardship to my 10,000 members and my union would not be found wanting in responding to this issue.”

ECA

The ECA representative said: “On the first application, the ECA is not in a position to support the TEEU on this occasion. We realise that it is based on the analogue under Section 25, but due to the economic situation we cannot support the increase. This issue is best resolved at the NJIC.

“On the second application, the ECA is a constituent body of the CIF, which has 2,500 members. The ECA represents about 50 of the largest contractors carrying out the majority of electrical work in the State, and the larger contracts. Our members employ about 5,000 electricians and electrical apprentices, who enjoy good wage rates and pension scheme.

“The agreement, which has existed since the 1920s and was registered in 1990, provides a level playing field, brings stability and certainty to the sector, provides good terms and conditions to workers, and serves large and small contractors alike. There has not been an industry strike since the 1960s.

“An argument has been that the REA serves to reduce employment and increase self-employment, but figures do not bear this out. The self-employed are also covered by the REA.

“Outside competition has always been an issue, particularly from Northern Ireland – it is one of the reasons that the REA was registered in the first place. The Posting Directive also copper-fastened the REA.

“Enforcement seems to be the main issue. It is in everyone’s interest that the REA is applied universally. EPACE is non-statutory and people can decide to co-operate or not, as they see fit, but this will change when EPACE is made statutory under NERA.

“As regards Section 29(2), there have been many changes, but we do not believe there has been substantial change to warrant cancellation of the REA. Many changes can be categorised as normal, on-going change. In the event of cancellation, many workers would lose out on pay, pension, and working conditions.”

AECI

The AECI representative said: “We have watched with interest and dismay the proceedings in this Court. On the first of the two issues, acting on a ballot of our members, we are in full rejection of the proposed 5% increase – and we seek a further reduction of the rate.

“On the second issue, if the REA was legitimate in 1990, then all persons are subject to the REA. If it was illegitimate, then damage has been caused to the industry and there is the matter of compensation.

“There is evidence that attempts in 2002-2006 by the TEEU, ECA and AECI to change the REA failed due to lack of support from non-aligned, non-members.

“The REA served the industry well for the first 10 years, but for the past 10 years we have been uncomfortable with some issues. We did raise them, but we were very disappointed with the response by the TEEU and ECA. We are now in need of a total revamp of the agreement and we are asking all interested bodies to get together to discuss these changes – sooner rather than later.”

NAC

Counsel for the NAC said: “The TEEU made no submission re the variation application. Does this mean he has nothing to add or that he is no longer pursuing the application? My clients were opposed to the variation in 2008 due to an inability to meet the proposed increase. The variation is opposed – and also the agreement ought to be cancelled.

“It is curious that Mr Miller (the TEEU representative) said that the figure of 12,000 electricians in the industry had not been questioned – when it was questioned by the Court itself and by the DKM document.
“It is astounding that what the AECI is putting forward could be presented as support for the agreement – when it is seeking a full and complete renegotiation.

“Even those who didn’t know about the REA are being put out of business by it – we have been subjected to almost a criminal test of evidence and we have shown this beyond doubt. Nobody here is trying to undermine employees’ rights, but everybody has rights – including small contractors. The REA is only being interpreted to the benefit of employees.

“The ‘race to the bottom’ argument is flawed. Both sides have given evidence that no electrician will work for the minimum wage. Conditions didn’t crumble for nearly 20 years when people were unaware of the REA and simply worked on ‘union rates’. Even Mr Redmond said he was staggered at the level of ignorance of the REA among his country employees.

“The idea that a circular would be sufficient to inform the industry was nonsensical – it was also sent in 2003 and yet the REA was registered in 1990!

“Mr Redmond, who negotiated the 1990 agreement, is happy with the REA. But he had a large labour force that is now reduced to 22 employees, he works in an urban area, and he would have had very little familiarity with his apprentices and their families such as the NAC and NECI witnesses have – you can’t at that size of business.

“Recommendations from the Court would, absolutely, be very interesting, in the normal course. But a cancer has to be treated – and recommendations cannot guarantee that anything will change.

“The AECI has already attempted to change the REA – and was left swinging. Their claim that their position is one of being against cancellation doesn’t stand up.

“Mr Miller has a difficulty with the fact that we are here. We are regarded as interlopers – which doesn’t augur well for any future renegotiation. For them it’s either you are with us or you are against us.

“We do not know how in 1990 the REA was considered to impact on small contractors and employers. The TEEU and ECA say we don’t understand the REA – but EPACE was telling us you have to pay travel time, subsistence allowance and the pension contributions. Also, the Revenue website gives strict rules for taxes on travel time, provision of vans, etc – we didn’t make it all up! Now we find out that we were paying out moneys to employees that we did not have to.

“The TEEU said that it had balloted its members on strike action, but Mr Wills admitted under cross-examination that he had only balloted his members on the variation. Mr Miller has on a number of occasions made, ‘in a proud voice’, threats to this Court. He finished today with the same threat, but more carefully phrased: ‘We will do what we have to in order to protect our members’.

“Our members are being brought to Court by a non-statutory body that is part-funded out of contributions taken from thousands of small contractors.

“I cannot understand how Mr Keenan only told us about the 10% reduction under cross examination – or how the same employer body could come in here last May and September and support a 5% increase, then in January seek a 10% decrease.

“While the country is rushing in several ways to save jobs, nobody can tear up this REA as it stands – unlike national wage agreements. But under Section 29(2) of the 1946 Act the Labour Court could simply take this job on itself, if it considers the REA to be ‘undesirable’.

“The TEEU says that the Laval case has no relevance to the REA. We have argued that it does – and workers might not be protected by Laval in the manner in which the Court believes it does.

“The Labour Court does not have jurisdiction in Northern Ireland. There has been no video evidence as to Northern Ireland contractors working in the Republic, that’s true, but there has been sworn evidence – and Mike Marshall was not challenged on his evidence that the number of completion certificates supplied far outnumber the number of electrical contractors in Donegal. Terence McKeever was murdered by the IRA in 1986 because he had given the names of contractors – it was a big event and discouraged contractors from coming south, and our evidence is that the peace process has encouraged Northern Ireland contractors to again come into the Republic.

“Mr Keenan referred to a 1% increase in the self-employed, but he was careful to use numbers when percentages don’t make his case, and vice versa – 1% of two million is a significant increase!

“EPACE is not irrelevant to these proceedings. EPACE attempts to enforce the REA overnight after a gap of 15 years of people being unaware of the REA or that they were in breach of anything. EPACE has effectively harangued and intimidated people, and the REA has become closely associated with an undesirable body. An elephant in the room is that the TEEU controls EPACE – and that is a problem for employers. Mr Keenan says that EPACE is entitled to ask for, but not get, payslips – that is like saying it’s OK to make a pass at someone, irrespective of whether it is welcome.

“I cannot see how any Labour Court recommendation could possibly cleanse what has happened to the agreement. I will be very surprised if EPACE comes under NERA – it is a voluntary, allegedly non-profit making, body that has tarnished itself and has €800,000 in the bank – why would that be desirable?

“Negotiating licences were raised at the start of this hearing by the NECI and this issue has never been dealt with by the parties to the agreement. The AECI never said anything and the ECA has not explained its ‘CIF-borrowed’ licence.

“The ECA’s ‘level playing field’ again brings the REA into question under Laval. ECA members do not enter agreements for the good of their employees, they enter them for a ‘level playing field’ – in any language that’s a cartel. The Competition Authority is investigating the large electrical contractors and we are told that the files are to go to the DPP.

“The REA has no wage reduction clause and no finite term. If the parties to the agreement do not think they will get a new agreement it is tantamount to admitting that they are not representative of the industry. NAC and NECI members are as valuable under the Constitution as are AECI and ECA members.”

NECI

Senior Counsel for the NECI said that he would be making legal arguments in written legal submissions with regard to the Laval case (a case in Sweden concerning a Latvian building contractor that the Swedish Court referred to the European Court), the 1996 EU Posting of Workers Directive (“which has possibly not been properly transposed into Irish law”), and the BATU case in the Irish High Court (“I have not yet ascertained whether the appeal is still live”).

“Registered Employment Agreements are an extraordinary feature of the industrial relations sector,” he said. “They can be agreed by parties who purport to be representative, then when registered they apply to others who are not necessarily aware of the agreement and may be non-compliant, and – in a dramatic and drastic affair – they are made subject not only to civil action but also to criminal sanction.

“The original raison d’etre of REAs was to regulate labour-intensive industries that were notorious for low wages. In contrast, the modern electrician is highly skilled, trained and educated – a Leaving Certificate can be a minimum requirement – and there are now all sorts of health and safety regulations and procedures. We are approaching electricians as if they are in satanic mills and as if they don’t understand. Not one electrician or TEEU member gave evidence that they need the protection of an REA.
“They will need remuneration and pension protection – but everyone needs that – and you don’t need an REA to ensure these for an educated and enlightened workforce. All other elements of the REA are irrelevant to this application. This agreement is archaic, antediluvian and has outlived its purpose. Dentists, nurses, mechanics, etc do not have an REA, for example.

“On the contrary, the evidence has been that apprentices have been abused because of the REA – and Mr Wills was unable to point out any deficiency in the pre-1990 agreement other than that it did not afford protection against Northern Ireland contractors.

“I reject the contention that my clients are interlopers here with no locus standi. The High Court had no difficulty in recognising locus standi for NECI and NAC counsel – and at the outset the Labour Court deemed to recognise our locus standi. Also, Section 29 (2) of the 1946 Act confirms that the Labour Court itself could determine of its own volition to cancel the agreement – it has the power.

“The AECI’s position on the REA is an extraordinary one. It has not attempted to persuade the Court one way or the other and has not offered a scintilla of evidence. The Labour Court should utterly disregard any position of the AECI. In 2005 the AECI addressed the Joint Oireachtas Committee and portrayed a doomsday situation, with 17,000 apprentices introduced into the industry – they made all the same points that we have made in the last two weeks. Their newsletter of 20th January 2009 confirmed their effective solidarity with my clients and those of counsel for the NAC and expressed to their members that the AECI is in opposition to the REA.

“The TEEU has held no ballot of its members on the REA. The hierarchy of the union has made a submission – but without the authority of its members. Why? Were they afraid of the outcome of a vote?

“The ECA represents the 50 largest contractors and the REA operates between these 50 contractors and the TEEU. That is an outrageous situation. We are given the notion of a level playing field day after day – but it is a cartel that grounds down the small contractors. The ECA is not supporting the main line of the REA at all. They have told us they are seeking a 10% reduction in wages – that’s a repudiation of the agreement. You can’t have it both ways. In effect, the ECA is rejecting the agreement and its position is as subversive of the REA as that of my clients – so there is no support for the REA from contractors at all!

“The NECI and NAC represent the dominant number of electrical contractors – the NECI over 600 and the NAC just as many, whereas the ECA represents 50 and AECI membership is dwindling. There has been undisputed evidence that there are now over 5,000 registered electrical contractors – so the representation at this juncture has changed beyond recognition since 1990.

“A doomsday situation has been advanced if this agreement is cancelled. The Court should absolutely dismiss and ignore the TEEU’s comments on strike action. They are idle threats – but threats nonetheless.

“If the REA is cancelled, what will be the consequences? Life will go on – nothing will change. It’s a complete nonsense on stilts to suggest that there will be a difficulty, or some belated industrial revolution. There will still be electrical work to be carried out, and people will do as they have always done, negotiate.

“There has been unchallenged evidence that there has been substantial change in the industry. There has been dramatic change in the numbers employed. EPACE is a substantial change – it is a vigilante organisation that has terrorised NECI and NAC members, with illicit funding, and has put numerous small contractors out of business. If we have regulations they should be enforced, but here, on evidence, a dignitary in the AECI was targeting small contractors in his area. This evidence was not challenged. If true, that is alarming and of enormous concern and the Labour Court must be mindful of that.

“I wanted lists of EPACE inspections of ECA members and Northern Ireland contractors. Ms Vega told us that all contractors in Northern Ireland and the Republic were up on the same software and so she couldn’t provide a Northern Ireland list – but she was able to produce an ECA list. I want the Court to ponder that. No evidence has been given on inspections of Northern Ireland contractors – it is absolutely apparent that no vigilation or control inspections have taken place or Northern Ireland contractors pursued.

“Another change has been the abuse of apprentices by large contractors letting them go in their fourth year. The AECI report in 2005 confirmed this. The REA does not, and cannot, address this.

“Other changes have been the expensive licence required by the Private Security Services Act, 2004; the way on which the new fixed price Government contracts are now operating – I adopt everything Mr Redmond said on this; the overwhelming evidence as to the growth in sole traders; that the AECI/ECA have no substantial representation of electrical contractors; and the extent of the current recession. There have been other changes in technology, health and safety, and training – and the rate of salary increase has been higher than the industry norm.

“All these changes can be amalgamated into significant change – and the 1946 Act only requires that there has been ‘a change’ – one word.

“Is it desirable to cancel the agreement? This is probably the most important question. This agreement is hindering the employment of electricians, because if you can’t deal with your own employees to reduce wages and keep jobs, you have to let them go to comply with the law. It is also contributing to the early release of apprentices, to the proliferation of ‘one-man-bands’, and is putting firms out of business.
“The REA has absolutely no regard for the differences and fundamental realities between a small contractor installing light switches in Skibbereen and a multi-national contractor with several thousand employees doing work as far away as Dubai. The ECA refers to a level playing field, but it is like Manchester United playing a Sunday team from a local park – the field may be level, but everything else is different.”

Notice Party?

Following the above submissions, the AECI representative asked: “Am I not right in saying that AECI are a notice party in these proceedings?” – to which the Chairman replied: “There is no such thing here. You might have been a notice party in other proceedings, but here you are either a participant or a spectator.”

When the AECI representative said: “We have records dating back 50 years. Can we submit …” the Chairman interjected: “Not at this stage! The only thing you might clarify is the position on representation in 1990.”

NI Contractors and EPACE

The employer representative then asked some interesting questions of the ECA representative. These included: “You said that Northern Ireland contractors have always been a problem. Have you any evidence that there has been no substantial change?” and “What changes may apply to EPACE from the Employment Law Compliance Bill 2008 – will its funding change?”

To the EPACE question, the ECA representative replied: “EPACE will have statutory authority under NERA. Its funding may change – but the Bill doesn’t indicate.”

Section 45 of the Employment Law Compliance Bill 2008, on compliance with the REA of the electrical contracting industry, does not refer to EPACE, only to “an approved body”. It remains to be seen, once decisions are forthcoming from the Labour Court and High Court, whether the REA will continue to exist. In addition, even if it does, while it is possible – perhaps highly probable – that any such approved body appointed by NERA will be EPACE, at this stage this is an assumption, not an inevitability.

News Friday 30th January 2009

Labour Court Completes Taking of Oral Evidence

Neil Steedman, IER Features Editor, reports.
[Updated Friday 6th February 2009]

 

The Labour Court hearing into two applications concerning the electrical contracting industry’s Registered Employment Agreement completed the taking of oral evidence on Monday 26th January 2009. A full day for final verbal submissions by the representatives of the five bodies participating (TEEU, ECA, AECI, NECI, and NAC) has been scheduled for Wednesday 4th February, while Monday 16th February has been set as the deadline for receipt of final written legal submissions.

The Court is considering two applications: the first, made by the TEEU, is for the Court to register a variation in the REA to increase the craft basic rate by €1.05 per hour, from €20.74 to €21.79 (a 5% increase), and with proportional increases applied to other rates; the second, made by the NECI and NAC, is for the Court to cancel the REA in its entirety.
(See IER website posting of 19th January 2009 for summary of events from Monday 12th to Friday 16th January.)

From Tuesday 20th to Monday 26th January the Court continued to hear oral evidence from witnesses for and against the cancellation of the REA. These comprised Nick Murphy, Kieran Marshall and Dolores Rogers for the NAC, economist Dr Moore McDowell (who returned for cross-examination) for the NECI, ICTU economist Paul Sweeney (who also returned for cross-examination) and General Secretary Owen Wills for the TEEU, and CIF director Eddie Keenan and Liam Redmond for the ECA.

Several significant issues came to the fore during the week, some being highlighted by contradictory evidence or interpretation being put forward by opposing bodies – or by one body or another contradicting or altering its own previous evidence or interpretation.Scope of REA

One issue was the scope of the Registered Employment Agreement, and specifically to whom does it apply?

On several occasions it was stated or implied that the REA only applies to electrical contractors with employees. For example, Dr McDowell said: “The REA does not apply to the use of labour but only to the use of labour as an employee”; the TEEU representative said: “One-man-shows are not employers”; the ECA representative asked: “How many of the 5,000 electrical contractors are employers?” and Eddie Keenan replied to Counsel for NECI that: “There is no evidence that your clients are employers,” (to which Counsel replied: “Evidence has been given and has not been challenged”).

Several witnesses also stated that one of the main changes in the industry over the past decade has been that many electricians have left employment to register themselves as subcontractors so that the employer and/or themselves can continue to tender for and undertake work without having to comply with the REA.

However, Eddie Keenan gave evidence that: “The onus is on all contracting bodies to adhere to the agreement. CSO figures show only a 1%-2% increase in self-employed people, who are also covered by the REA.” When cross-examined by Counsel for NAC, he said: “Even sole traders are subject to the REA, and main contractors must ensure that subcontractors comply with the REA” and again, when asked by the ECA representative: “Are subcontractors covered by the REA?” he replied: “Yes.”

Also, when the ECA representative asked Denis Judge: “You are only one person so you are not affected by the REA?” he replied: “Yes, I am subject to the REA, and if I price a job I must take the REA into account.”

It was also stated or implied several times during the hearing that the REA does not apply to out-of-State contractors. (On one occasion the Chairman responded with the comment: “Maybe no-one pursues them.”) However, Eddie Keenan said: “People outside the State must register with Revenue,” and “If the REA were cancelled it would be harder to compete with outside contractors because the competition could apply rates at their country of origin.” Also, Liam Redmond said: “If the REA is cancelled, foreign contractors could then come in and do whatever they want.”

Also, ICTU General Secretary David Begg had earlier said: “The REA is a protection because out-of-State contractors must adhere to the REA.” However, when asked by Counsel for NECI: “Do you know anything about enforcement proceedings against non-national contractors?” he replied: “I have no knowledge of specific cases.” He also agreed with Counsel that the number of REAs had declined from 60 in 1946 to only six now, and when asked: “In what other sectors apart from construction do the REAs apply?” he replied: “I am not sure.”

The second paragraph of the REA, under the heading ‘Scope’, states: “This agreement will apply to all electricians who are engaged in the general electrical contracting industry and to their employers and to all electrical contractors engaged in the industry. An electrical contractor is defined as the proprietor of a business whose main activity is the performance of electrical work on a contract or sub-contract basis for any third party.”

This means that all parties – employees, employers, contractors, subcontractors and sole traders, whether based in the Republic of Ireland or elsewhere – are subject to the REA. However, it is obvious that in practice it is much harder, if not impossible, to enforce ‘wage rates’, subsistence allowance, pension contributions, etc on individual subcontractors or sole traders. (Although, IER frequently recalls the perceptive comment made some years ago by one well-known electrical contractor that: “I don’t understand this concept of the sole trader electrician … who pulls the other end of the cable?”)

It is also harder, if not impossible, to enforce the REA’s wage rates and conditions on out-of-State contractors who may bring their employees into the State, complete a small contract or shop fit-out in a few weeks, and then leave the State.

ECA and AECI Positions

At the start of the hearing on Monday 12th January, the positions of the ECA and the AECI were stated to be that both bodies supported the REA but that they could not afford, agree with or accept the proposed 5% wage increase.

On Wednesday 14th January the AECI representative said: “We will not be calling witnesses but we will make a submission. We still support the REA but would like to discuss areas of the agreement that should be changed by the constituent bodies.” The following day, he commented: “We would only agree to hold on to the REA if we can go back and renegotiate it. Working together we would get very close.”

On Wednesday 21st January Counsel for NECI introduced into Court a letter sent the previous evening to AECI members from head office that included: “The President of AECI has stated at the Labour Court that the AECI are not happy with the current REA (Registered Employment Agreement) and as per our members’ ballot taken it was agreed to seek a full and complete renegotiation of the employment agreement.” Counsel asked of a witness: “Would you be surprised to hear that no such case has been made to this Court?” The AECI representative confirmed that the AECI’s position was as stated in the letter.

Also, in response to the AECI representative, ECA witness Eddie Keenan agreed that: “The industry should take a hard look at the REA,” and said: “We are not totally happy with certain sections of the REA. There are procedures in the REA to raise any changes in the REA through the NJIC.” (The latter may refer to section 24 of the REA on Provision for Variation, which states, in full: “This Agreement may be varied in accordance with the provisions of section 28 of the Industrial Relations Act, 1946.”)

Also, Eddie Keenan revealed under cross-examination that: “We have lodged a 10% reduction with the TEEU. We discussed this with the AECI before this Labour Court hearing started. It has yet to be lodged with the NJIC because we have not had a meeting yet.” Asked by Counsel for NAC how such a wage decrease could be dealt with in respect to the REA, he replied: “Amendment by variation.” Counsel then asked: “The ECA agreed with the proposed 5% wage increase in November 2008. When did you change your mind?” He replied: “Within the past month.” Asked when he expected such discussions to be concluded and if he thought they would be successful, he said: “I don’t know, we are not very optimistic. The TEEU reaction has not been positive.” (When asked later about the ECA’s chances of success, Liam Redmond said: “I don’t think he has a chance in hell of getting it!”)

Thus, the ECA and AECI are now not only opposed to a 5% wage increase but are seeking a 10% wage decrease, and, rather than being in agreement with the existing REA, they are in favour of a “full and complete renegotiation”.

Travelling Time and Country Work

Almost all the NECI and NAC witnesses gave evidence that, while they would prefer more flexibility in agreeing wage rates with their employees, in order to increase their ability to win contracts and to maintain employment, their opposition to the REA, and their inability to compete effectively, to maintain employment or even to stay in business because of it, was less to do with the wage rates but more with the ‘extras’, including travelling time, country work, and pension contributions.

Conflicting evidence was given as to whether and when travelling time (applicable where shop to site distance is within 11 miles) and country work (applicable over 11 miles) – and specifically the €168.26 weekly subsistence allowance – were payable, including whether travelling time was payable if the employer provided transport.

When the Chairman asked Owen Wills: “Is it your evidence to the Court that witnesses’ statements that they are obliged to pay the €168 is not the generally accepted application of the agreement?” he replied: “Yes.” However, the TEEU Ezine of November 2008 states: “Subsistence: €176.67 per week from 1st April 2008 (payable once the distance from the shop to the site exceeds 11 miles).”

This publication, under ‘Electrical Contracting Industry Rates 2008-2009’, purports to give ‘Rates of Pay from 1st April 2008’ – but the rates given are those of the variation application now before the Labour Court, not of the current REA. For example, the craft basic rate is given as €21.79 (rather than the current rate of €20.74) and the subsistence allowance is given as €176.67 (rather than the current rate of €168.26). Even if the Labour Court accepts the TEEU wage variation application, these rates will only apply from the date that the variation is registered by the Court, not from 1st April 2008. The TEEU was advised of this on 22nd May 2008 when the Chairman stated: “We can only register any agreed pay rate from a current date.”

Referring to Clause 7 of the REA – which states: “Jobs shall be done on a country work basis when the distance of the job from the shop precludes (in the employer’s opinion) working from shop or in site in accordance with Rule 1” (which relates to standard working hours and start times) – the Chairman said: “I am trying to reconcile the position in the REA with evidence given. Maybe this is a question for the Labour Court?”

Another question the Labour Court may consider is whether EPACE accepts “the employer’s opinion” when assessing ‘arrears’, or if it makes its own determination. Yet another may be whether the rates that EPACE has been applying for 2008 are those of the REA or those that the TEEU would like them to have been.

CIF Pension Scheme

The REA states (section 23): “A pension and mortality scheme equal in conditions and benefits to the terms of the pension and mortality scheme of the Registered Agreement for the construction industry to be provided for all employees between the age of 20 and 65 years.” Similarly, section 22 refers to a sick pay scheme “equal in benefits” to those of the construction industry REA.

However, section 23 continues: “In this connection each employee between the age of 20 and 65 years to be entered in the Construction Federation Pension and Mortality Scheme.” Also, the TEEU Ezine of November 2008, under ‘Pension and Sick Pay Scheme’, states: “All employees between the age of 20 and 65 to be entered into the Construction Workers Pension and Sick Pay Scheme.”

Several contractors gave evidence that they had PRSA or other pension schemes for their employees (Irish Life, Eagle Star and Acorn Life were mentioned) but that these were deemed to be ‘unequal’ by EPACE and that they had no option but to join the CIF’s Construction Workers Pension Scheme.

For example, NAC witness Dermot Troy said: “I have been told by Acorn Life that their pension scheme is the same – and my employees never complained – but EPACE would not accept Acorn Life. I was told the only place was the CIF and no other. Approximately six months ago the clerk of works on a Health Board office block in Portlaoise told me that there would be no more work for me because we were not in the CWPS, and in Mullingar, Tullamore and Portlaoise the TEEU said that we must be in the CWPS.”

Nick Murphy said: “I joined the ECA for a short time because I was told by Rebecca Vega of EPACE that I couldn’t join the CWPS without joining CIF/ECA – but I stopped membership in 2007. After we received the PRSA information we had pensions with Eagle Star but EPACE didn’t allow that, so we stopped paying Eagle Star. The employees can claim back on the contributions at retirement age and some guys have continued to pay into Eagle Star.”

When Counsel for NECI asked Eddie Keenan: “Has any pension scheme other than the CWPS been accepted?” he replied: “Yes, one,” but when asked “Which one?” he replied: “I don’t have the name.”

Dave Butler said: “As far as I know, no other pension scheme has been accepted as ‘equal and equivalent’. Who decides what is equal and equivalent?” – to which the Chairman interjected: “Ultimately, we might have to.”

Dolores Rogers gave evidence that she rang the CWPS to ask about employer and employee pension contributions and was given one figure for each and was told that they were mandatory. She asked for, but was not given, a breakdown of these contribution figures.

Through research she established that, in fact, the ‘pension contribution’ comprised six separate elements: pension benefit, death in service benefit, sick pay, Workers Health Trust, Benevolent Funds (one for employers, one for employees), and EPACE. “Employers are sending the total figures, not realising the breakdown. The REA does not state that funds will be collected and sent to the Workers Health Trust, Benevolent Funds and EPACE – and the pension and death in service are the only items not subject to tax.

“I once called the CWPS and said that an employee wanted to pay into the Benevolent Fund, but I was told: ‘You can’t pay one, you have got to pay them all’.”

The precise breakdown of all the contributions are now given on the CWPS website, including €0.38 each from employer and employee for EPACE, but Counsel for NECI told the Court: “The breakdown has only been provided since my clients initiated proceedings.”

Level Playing Field

On a number of occasions the TEEU and ECA representatives, as well as their witnesses David Begg, Eddie Keenan, and Liam Redmond, referred to a ‘level playing field’.

The contention is that the REA – by fixing wage rates and other payments such as travelling time and subsistence allowance, as well as pension, death in service and sick pay requirements, and working conditions – creates equal conditions under which each and every electrical contractor working in the Republic, no matter whether large or small, urban or rural, based within or outside the State, can compete on equal terms.

Owen Wills, for example, said in relation to registration of the REA in 1990: “Undercutting by Northern Ireland contractors was a key issue then,” and “Registration was very important for the industry because it protected contractors from overseas competition.”

However, Counsel for the NAC had said on the first day: “The anti-competitive nature of the REA is not simply background. My clients must adhere to an agreement to which they cannot adhere – and therefore they cannot tender for public contracts. There is no let-out clause in the REA and the massive increase in policing of the REA is on a course of criminal prosecutions, and with penalties from €1,000 per day.”

Mike Marshall had said: “I could understand ECA members being party to the REA, but I was surprised that AECI members were – and all other contractors were never represented. There will never be a level playing field – the ECA and NECI/NAC members operate in totally different worlds and the only thing they have in common is the title of ‘electrical contractor’.”

Two soccer team managers and a players’ union may well design a level playing field, but if it is built at an altitude that is difficult or impossible for other teams to play at (and whose managers are never consulted about its design or location), is it a sensible or fair level playing field? Furthermore, if the referees work under the auspices of the two managers and union (or by one manager and the union) and do not apply the rules of the game to all home teams and few if any visiting overseas teams, how can all teams compete on equal terms?

In addition, the ‘elephant in the court room’ during the two weeks has been the Competition Authority’s investigations since 2006 into the existence of a cartel or cartels in the electrical contracting industry. In the Christmas 2006 issue of ECSSA News, an article entitled ‘A Level Playing Field’ included: “The basic problem in the trade was caused by the major players and their outcry for a level playing field at this stage may be little more than a diversionary tactic to distract attention from their own far more questionable tactics.”

EPACE Inspections

Throughout the hearing, members of NECI and NAC gave evidence on how they had been communicated to, inspected, ‘fined’ alleged arrears, and in some cases taken to Court by EPACE. For example, Dave Butler said: “There is a massive fear factor among small electrical contractors. They are being bullied, harassed, and intimidated by EPACE.”

Several witnesses emphasised that EPACE was a private limited company with no statutory powers and yet was ‘demanding’ access and company information, including pay slips. In response to Counsel for NAC, Eddie Keenan said: “EPACE has the right to ask for pay slips, but it does not have the right to get pay slips.”

Counsel for NECI said: “The level of enforcement is being contested by my clients because it is the smaller contractors that are being targeted,” and Counsel for NAC said: “It is very important to note that most employers have not been brought before the Labour Court on the basis of complaints by employees.”

Reference was made to the fact that, under legislation before the Dail, it is proposed that EPACE will come under the auspices of the National Employment Rights Authority. When asked by the employer representative: “EPACE doesn’t attempt to make friends. Wouldn’t it be better if it did?” Owen Wills replied: “Once the Bill is passed, the legal function will be invested in NERA and EPACE will work under NERA with a service agreement and a Code of Practice.” He added that EPACE had been successful and that: “When it gets statutory powers it will be more successful.”

However, when asked by the Chairman: “If NERA delegates functions to EPACE, will it fundamentally change the manner in which EPACE undertakes its business?” he replied: “I haven’t seen the details.” The Chairman then asked about complaints procedures in EPACE, and Owen Wills said: “They are currently done internally, but they will be considered by an independent, outside group.”

When asked by Counsel for NAC: “Are you aware of the methods used by EPACE?” Eddie Keenan replied: “No” (to which Counsel responded: “Then how do you support them?”)

On Friday the issue arose as to how many ECA members and Northern Ireland electrical contractors had been inspected. After some debate, Senior Counsel for NECI agreed with the Chairman’s suggestion that either oral evidence to this effect could be taken from someone in EPACE on Monday 27th January or that written evidence be provided, perhaps through the ECA.

On Monday morning the ECA representative told the Court that she had been advised that all ECA members had been inspected – “54 from 2005 to date”. Counsel for NECI countered that there had been no attempt by EPACE to assure compliance by Northern Ireland contractors and that not all ECA members had been inspected. The ECA representative replied: “I have an email from EPACE concerning ECA members, but I am reluctant to submit it to the Court.”

The Chairman advised that the Court had provision to go into private session to consider sensitive information – and this was agreed and acted upon later in the day. An EPACE representative was to be asked to attend.

While IER is aware of some of the information provided, we cannot report on it for legal reasons. However, given that EPACE was set up in 2000 and that the ECA and AECI between them have only around 350 members who employ up to 9,000 electricians, obvious questions for the Labour Court to want answered are: Have all ECA and AECI members been inspected by EPACE to date? If not, why not? How many of those members inspected were found to be fully compliant? What action has been taken against all those who were non-compliant?

In addition, there is the question of EPACE inspections of Northern Ireland electrical contractors – or, indeed, of English, Polish and other EU contractors.

Perhaps in the private session the Chairman received an answer to his earlier pertinent question: “Does EPACE have records of inspections by category?”

Knowledge of REA

Many of the NECI and NAC witnesses gave evidence that the first they knew about the REA (registered in 1990), or about EPACE (established in 2000), was when they were contacted by EPACE in the period 2004-2008. Several also testified that their employees did not know about the REA either.

For example, NAC witness Dolores Rogers said: “I was not aware of the REA. I learnt of it the day I joined the AECI as Operations Manager on 26th June 2006. About 80% of my time was taken up by calls from electrical contractors – AECI members and non-members – who were very upset, some were unaware of the AECI / EPACE connection, and they were unhappy with the intimidating behaviour of EPACE.”

NAC witness Mike Marshall said that he had no knowledge of the REA until he became Technical Manager of ECSSA in February 2004 and that: “It was the same for many others and it only became apparent due to the policing activities of EPACE. From mid-2004 onwards there were ever-increasing calls from contractors and their wives about an agreement of which they had been unaware and to which they were allegedly non-compliant. There was a very poor job done in publicising the REA.”

The TEEU representative referred several times to a mail-out by EPACE on 8th September 2003 to all electrical contractors then registered with RECI or ECSSA, which comprised a letter, a questionnaire / compliance form and a copy of the REA. EPACE had also placed advertisements in “national newspapers that were popular on sites”. Three different figures were given as to the number of contractors thus circulated, varying from 3,200 to 3,600. In response to the Chairman, the TEEU representative confirmed that the letters were not registered. The TEEU did not present evidence as to the number of compliance forms completed and returned to EPACE.

When asked by the AECI representative whether this TEEU correspondence would have been received by contractors, Dolores Rogers replied: “Why would people who know about the REA ring the AECI office and say they did not know?” One could equally ask why would so many contractors ring the ECSSA office from 2004 onwards and ask about the REA if they knew about it already? Or, indeed, why were the advertisements not placed in newspapers that were popular in boardrooms, rather than on sites?

Asked by the Court’s employee representative: “Is it reasonable that small contractors were not aware of the REA?” Eddie Keenan replied: “I accept that, but ignorance is no defence.”

Electricians and TEEU Membership

The TEEU is the only trade union representing electricians in the country, at the ENJIC, and for the REA. (No-one questioned this position or its right to do so during the hearing.) However, it was not until Friday, on the ninth day, that the question arose as to how many electricians there are currently in the electrical contracting industry and how many are represented by the TEEU.

During cross-examination, Counsel for NECI put to General Secretary Owen Wills that the TEEU had about 6,000 members in the electrical contracting industry, but he replied: “The union has 40,000 members of which 10,000-plus are in electrical contracting.” No corroborative evidence was given for either figure.

The LRC Annual Report for 2000 stated that at 1st January 2000 the overall membership of the TEEU was 28,559. The LRC Review, Issue 1, 2006, in an article entitled ‘Employee Voice in Ireland’ by Prof John Geary of UCD, showed that trade union density in the construction sector declined from 34.40% in 2000 to 26.86% in 2004. Trade union density among craft workers (in all sectors) declined from 41.01% in 2000 to 33.33% in 2004. It also said: “A third of employees in construction are unionised.”

Owen Wills had earlier stated: “I speak on behalf of all the electricians in the industry.” When asked by the Court’s employee representative how many electricians there were in the electrical contracting industry, he estimated: “About 12,000?”

However, when asked by the Chairman, he accepted Eddie Keenan’s evidence that ECA members employed about 5,000 electricians, and when further asked how many worked for AECI members he replied: “5,000-6,000.” The Chairman pointed out that these totalled more than his claimed membership of 10,000. AECI President Jack Hegarty then advised the Court that: “AECI members employed 3,000-4,000 electricians at the best times.”

Then on Monday, during cross-examination of Eddie Keenan, Counsel for NECI introduced an independent review and 2007-2009 forecast of the construction industry prepared in 2007 for the Department of the Environment by DKM Consultants. This stated that during 2002-2007 there were some 31,200 electricians and electrical maintenance fitters.

The Chairman tellingly asked: “Mr Wills estimates that the TEEU has 10,000 electrician members and that there are in the order of 12,000 electricians in the industry, but if the ECA employs 5,000 electricians, and the AECI employs 4,000 – a total of 9,000 – are 22,000 employed by other electrical contractors? Who are electrical maintenance fitters?” Eddie Keenan opted to reply to the second question: “They are not covered by the REA. We tried.”

FAS Electrical Apprentices

During the two weeks of the hearing, several witnesses referred to the high number of electrical apprentice registrations by FAS over the past decade, and also to the prevalence of fourth-year apprentices being let go before they became eligible for the craft basic rate (currently an increase from €16.59 to €20.74 per hour). At a late stage there was a suggestion that a representative of FAS should be called to give statistical evidence, but this did not happen.

However, FAS Quarterly Labour Market Commentaries for 2005-2007 show that apprentice starts were over 2,000 per annum for the 1999-2006 period but then dropped to around 500 per annum. This suggests that at least 16,000 electrical apprentices joined the industry over the nine-year period from 1999-2008.

The 3Q 2005 Commentary stated: “The number of apprentice starts totalled 8,725 in the year to end-September 2005, up 12% on the previous 12 months. Demand continues to be strong for construction and electrical apprentices. The number of apprentice starts in construction rose by 9% in the 12 months to the third quarter of 2005, while the number of starts in the electrical trades rose by 27% over the same period.”

The 2Q 2006 Commentary included: “Construction and electrical apprenticeship starts fell by 4% and 5% respectively, which was consistent with the deceleration in construction employment since the second quarter of 2005.”

Also, in an interview published in IER in May 2006, AECI President Dermot McClannon said: “FAS has a lot to answer for by producing so many electrical apprentices. They argue that they are ‘meeting trade demand’, but what is happening is that some contractors are taking on first-year apprentices then letting them go when they become more expensive third-year or fourth-year apprentices and replacing them with a new batch of first-year apprentices. The follow-on from that is that a huge number of fourth-year apprentices end up taking work on themselves, working out the back of a van, ‘acquiring’ completion certificates one way or another, and charging rock-bottom prices.”

Several references were also made to the traditional ‘2:1’ apprentice ratio, along with claims that this was now being extensively ignored. For example, Mike Marshall said: “You now have one or two electricians supervising 10 or 12 apprentices.” Perhaps it was a slip of the tongue, but when the Court’s employee representative asked Owen Wills for clarification as to whether ‘2:1’ meant one electrician to two apprentices or vice versa, he replied: “Two electricians to one apprentice.”

It was, of course, the other way around. However, at some stage before the end of 2005 even the one electrician to two apprentices ratio had been removed from the REA. It now reads (section 15): “No more than two apprentices of 1st, 2nd or 3rd year grades shall be employed on the same job under the supervision of one electrician.” There is therefore now nothing in the REA to prevent a contractor employing two 1st-to-3rd year apprentices and any number of 4th year apprentices to each electrician.

Denis Judge gave evidence that, when representing the AECI, he had made representations to the TEEU in 2007 that the 2:1 apprentice ratio be reinstated, but he said that the response was: “It would cost 50 cent on the hourly charge-out rate.”

Renegotiating the REA

By the end of the two weeks, all the parties represented had expressed, in varying degrees, their willingness to negotiate a new agreement.

TEEU General Secretary Owen Wills initially said: “If the Labour Court cancelled the REA it would destroy the industry and, unless there was another, there would immediately be a national strike by the TEEU. A ballot was 89% in favour of industrial action and we would extend it to our ESB members and people would not get a connection.” He subsequently agreed with Counsel for NECI that the TEEU ballot had been in relation to the wage variation issue only, and not to any cancellation of the REA.

However, when asked by the AECI representative whether he had any problem with the REA being changed, he said: “Absolutely not. There is a mechanism for amending the REA by agreement – and if something is not agreed it can be referred to the Labour Court. I personally think it would be good to review the REA. I would agree that this is a right time to review it and I would even suggest that the Labour Court assist in this regard – they have advisory services.” Asked by Counsel for NAC: “What is the TEEU’s position on a complete review?” he replied: “I would expect it would be the same as my personal position.”

Asked by Counsel for NECI: “If the REA were cancelled, what conceivable problem would there be in renegotiating a new agreement?” Owen Wills replied: “I am not fearful of it. It is a question of trust and credibility with the parties who wish to be a party to it. Our members would not be confident that these would comply with it.”

Both the ECA and AECI have expressed a willingness and desire to have a full review of the REA. In addition, asked by the AECI representative whether anyone had stopped non-members of AECI or ECA from being involved in the NJIC, and hence the REA, Eddie Keenan said: “Maybe it is time to change some of the elements of representation.”

Although they have applied for the REA to be cancelled, the NECI and NAC have also expressed themselves in favour of an alternative agreement, provided that it is one that is representative of the views and interests of all electrical contractors, large and small, urban and rural.

The Court members have also been asking questions that indicate that they are giving serious consideration not only as to what might be the possible consequences of cancelling the REA, but also as to how a broader representation of the industry might be achieved.

For example, the employee representative said: “I think the industry should regulate itself, rather than regulation being imposed from a bureaucratic background. The existing REA was drawn up by electricians and electrical contractors at the higher end.” He then asked NECI witness PJ Salmon: “Would you be willing to negotiate new terms of an REA?” – to which the reply was: “Yes, I would.”

The Chairman has asked numerous witnesses what they thought the consequences of cancelling the REA would be on wage rates and the extent of pension cover. He has also said, in relation to the negotiating structure within the industry: “There is no provision for representation other than as members of negotiating organisations. Obviously there are difficulties in providing representation and negotiating rights to unaffiliated people, be they employees or employers.”

When he asked Owen Wills: “Is there a mechanism by which bodies could apply to join the NJIC?” the reply was: “There are no barriers.” “So there is nothing immutable about the composition of the NJIC?” “No.” “But it is up to NJIC members?” “The composition can be examined.”

Court Decisions

The Labour Court has yet to hear final oral submissions from the five parties, to receive written legal submissions, and to study numerous affidavits and documents (the Chairman has also referred to “a flotilla of sworn affidavits in the High Court proceedings”) before it reaches decisions on the two applications before it.

On the first application, to vary the REA to incorporate a 5% wage increase, the Court is faced with the fact that now only the applicant, the TEEU, supports this. The two employer partners to the REA – the ECA and AECI, which together represent 340 electrical contractors – are now not only pleading an inability to pay a 5% increase but have also lodged a proposal for a 10% decrease in pay with the TEEU. In addition, the NECI and NAC, which together represent more than 1,100 contractors, are also opposed to the application.

On the second application, to cancel the REA in its entirety, the Court has to determine whether the change in the industry since 1990 has been “substantial change” and, if so, whether the nature of that substantial change makes it unreasonable to maintain the REA.

One factor that the Court will have to consider in this regard is whether the existing parties to the agreement are substantially representative of today’s electrical contracting industry.

On the employee side, there are an estimated 23,000 – 28,000 electricians in the industry (50 ECA members employing an average of 100 electricians, 300 AECI members with an average of 12 each, and 4,900 other registered contractors averaging three or four each). The TEEU represents 8,000 – 10,000 electricians, or between 29% and 44% of the workforce.

On the employer side, there are around 5,250 registered electrical contractors, all of whom are subject to the REA. The ECA and AECI’s combined membership of 340 contractors is 6.5% of the total (and they employ about one-third of the electrical contracting labour force).

News Monday 19th January 2009

Labour Court REA Hearing Continues

Neil Steedman, IER Features Editor, reports.

Despite a full week of public sessions, from Monday 12th to Friday 16th January 2009, the Labour Court hearing into two applications concerning the electrical contracting industry’s Registered Employment Agreement had not been completed by close of business on Friday 16th January. The Court has therefore scheduled four half-day public sessions from Tuesday 20th to Friday 23rd January. A further day may also be required for legal submissions.

The Court is considering two applications: the first is for the Court to register a variation in the REA to increase the craft basic rate by €1.05 per hour, from €20.74 to €21.79 (a 5% increase), and with proportional increases applied to other rates; the second is for the Court to cancel the REA in its entirety.

Wage Variation

The wage variation was originally determined by reference to the set of analogue companies as in September 2007, as specified in Clause 25 of the REA.

Wage Variation

The variation was originally agreed to by the three parties to the REA – the TEEU, ECA and AECI – but was not registered with the Labour Court or implemented by the due date of 1st April 2008.

Two groups rapidly formed early last year among non-represented electrical contractors to object to the proposed wage variation and, indeed, to the validity of the REA itself. These are the National Electrical Contractors of Ireland (NECI) and a group of independent electrical contractors (referred to here as the Non-Aligned Contractors, or NAC). When the Labour Court met on 22nd May 2008 to hear these groups’ objections, the AECI stated that, while it continued to support the REA and had to continue to support the application, it also pleaded an inability to pay the proposed wage increase.

Various matters were then taken to the High Court – and a judicial review sought by NAC as to the validity of the REA remains outstanding there.

When the Labour Court hearing opened on Monday 12th January 2009, there were significant changes in the employer bodies’ respective positions. The ECA stated: “Because of the worsening situation, in construction generally and electrical contracting in particular, we are no longer able to support the TEEU in its application. While we fully support the REA and accept Section 25 (on wage review), our members simply cannot afford the proposed wage variation.”

The AECI had also hardened its position: “We are not consenting to the €1.05 increase. We have balloted our members and have been mandated not to accept the proposed variation.”

The TEEU argued: “Within the terms of the REA, the employers do not have the facility to change their position. Clause 25 states that the analogue system ‘shall be the sole method of wage determination’. This process was followed by all parties to the agreement and the wage variation of €1.05 determined. The TEEU has kept to the full requirements of the REA and at this point in time the employer bodies are flagrantly in breach of the agreement.”

In response, the Labour Court Chairman, Kevin Duffy, summarised the position as: “The TEEU has made an application to vary the agreement, and the ECA and AECI are now opposing the increase.”

Senior Counsel for the NECI then stated: “It is hugely significant that the ECA and AECI are now objecting to the increase. The construction industry is in a catastrophic situation. Statements made on affidavit that electrical contractors are being decimated were not challenged. It is beyond gainsaying that nobody can afford to pay the increase. If the larger bodies cannot afford to pay it, how can the smaller bodies possibly do so? The application is utterly unsustainable.”

Junior Counsel for NAC said: “The application has at no point put forward a case as to why an increase is required – and even in so far as the REA method was adhered to, 1st April 2009 would have to be the earliest date of introduction of any wage variation. It is not just the economic climate but also the REA itself that has been putting NAC and NECI members out of business.”

The Court has yet to rule on the wage variation application, but summing up comments made by the Chairman on Monday may be indicative: “It is the TEEU’s case that the REA is ‘self-executing’. However, a role of the Court is to register agreements – and by so registering an agreement’s ambit is extended beyond that of the partners to the agreement. This should also apply to variations. As regards this application there is no agreement between the parties to the REA, or with other parties – so are we stuck at the first hurdle?”

Cancellation of REA

The remainder of the week was devoted to hearing the case made by NECI and NAC that the Labour Court should cancel the REA in its entirety. Sworn affidavits had previously been lodged by numerous witnesses and oral evidence was taken under oath by a number of them. In addition, two rebuttal witnesses have given evidence on behalf of the TEEU. Further witnesses are to give oral evidence this week on behalf of the application. The ECA and AECI initially indicated that they would not be calling witnesses, but the ECA has since indicated that it may also call witnesses to argue against the application.

In addition, Counsel for NECI has indicated that he may wish to make “certain legal submissions” and summarised their nature as follows:

As regards whether the REA was properly and legally registered in 1990, the Chairman stated: “It is to be assumed that the Labour Court acted properly in 1990. We cannot judicially review ourselves – that would have to be done elsewhere. We have looked high up and low down, but we don’t keep records for that length of time. If you wish for the application to cancel the agreement to be adjourned until the High Court decision, then the Labour Court might be disposed to it.

“The Court can only deal with this application with regard to Clause 29(2).” (This is the section of the Industrial Relations Act, 1946, under which the Labour Court can decide to cancel an REA.) “There are two questions to be answered: Has there been substantial change (in the electrical contracting industry since 1990)? Is it such as to make it unreasonable to maintain the REA?”

Expert witnesses to date have included three economists (for NECI, NAC and the TEEU), Michael Marshall (for NAC), and ICTU General Secretary David Begg (for TEEU). Other witnesses to date have been electrical contractors Denis Judge, David Butler, Patrick Breslin, Claire Tunissen, Dermot Troy, PJ Salmon, Brian Kelly, Eamon Barry, George Wilkins, Paul Lynch, Peadar Leddy, and John Smith.

A detailed summary of the evidence given will be published by Irish Electrical Review in its next issue (and posted on this website), once the giving of oral evidence has been completed.

Representation Levels

None of the parties to the REA have to date put forward any statistics as to the numbers of electrical contractors in the country in 1990 – or, indeed, challenged assertions made by NECI and NAC witnesses that there were 2,500 – 3,000 at the time the agreement was made and registered. Also, the Labour Court, according to the Chairman, has sought but not found any records from 1990.

From its files of issues published between 1989 and 1995, Irish Electrical Review has determined the following:

  1. In 1990 the AECI had 258 members and the ECA had 60 members, a total of 318 between them (assuming there were no dual memberships).
  2. The Register of Electrical Contractors of Ireland was formally unveiled on 14th April 1992 and “approximately 350 contractors have now been approved for membership certification” (April 1992 issue).
  3. Within six months, “already over 1,000 electrical contractors have been registered” (November 1992 issue).
  4. Within two years, RECI membership “now stands at approximately 1,600 with a potential for as many as 1,800” (RECI Chairman Noel O’Riordan, March 1994).
  5. By the end of 1994 RECI had “almost 1,700 fully paid-up members” (Noel O’Riordan, January 1995).

If there were 1,800 electrical contractors in Ireland in 1990, the two employer parties to the REA represented 17.66% of them. ECSSA was established in 1997 and within one year had up to 1,000 members, most of whom would have been ‘beyond the RECI radar’ until then. If there were as many as 2,500 electrical contractors in 1990, the ECA/AECI level of representation was lower, at 12.72%.

Today the AECI has 285 members and the ECA 52 members, a total of 337 between them. The combined membership of RECI and ECSSA is 5,278 electrical contractors, but there are a small number of dual memberships (although these are no longer permissible since 5th January 2009). It is also a matter of conjecture how many of these are employers under the terms of the REA – or, indeed, would be employers as and when they win contracts requiring an increased workforce.

In 2005, in evidence to a Joint Oireachtas Committee, Gerry Goggin of the AECI stated: “As regards non-aligned contractors, there are in excess of 4,000 registered electrical contractors in the State, of whom almost 550 are members of trade associations such as the AECI and ECA. It is clear that approximately 3,500 electrical contractors are not represented by this system. That is a major part of the problem.”

If there are now, say, 5,000 electrical contractor employers, the AECI/ECA represent 6.74% of them. If a ‘generous allowance’ of 1,000 is taken as the number of non-employer registrations, then there are currently some 4,300 electrical contractor employers, of which 7.84% are represented by the AECI/ECA.

 

News November 2008

Labour Court Schedules 5-day Public Hearing in January 2009

At a case management meeting convened by the Labour Court on Monday 17th November, the Court determined against an application made by the Non-Aligned Contractors for a further adjournment until all issues relating to the electrical industry’s Registered Employment Agreement had been determined in the Four Courts.

The Court then decided to schedule a five-day public hearing, commencing on Monday 12th January 2009, at which the application for a variation to the REA, and the opposing applications for the REA itself to be cancelled, will be considered together. Oral submissions will be taken at the hearing, but written submissions, affidavits, and witness statements that outline who each proposed witness is and their main points, are to be filed with the Labour Court – and served on all other parties – by Wednesday 7th January.

At the High Court on Monday 20th October, the stay previously granted to the NAC preventing the Labour Court from considering the applications was lifted, the NAC having stated that its members were not in a position to give an undertaking as to damages, as requested by the TEEU, and costs of the High Court case were subsequently awarded against the NAC. Following that, the Labour Court convened the case management meeting, which was attended by representatives of the TEEU, ECA, AECI, NAC and NECI.

Four Positions

Each of the five parties set out its current position in turn – with four different positions resulting:

Adjournment
 
In seeking an adjournment of the entire proceedings until after the issues had been determined in the Four Courts, counsel for the NAC stated that the initial request for an adjournment made on 22nd May was based on insufficient time being given, that the position changed by 11th June to timing and a case stated, while now there was a third basis, a High Court application for a judicial review.

The TEEU countered that there was no justice in its members not having received the proposed increase to which they were entitled (since 1st April 2008) and that an adjournment can be used simply to frustrate the variation application being considered. “The Labour Court has to make the assumption that the 1946 Act is valid unless and until it is decided otherwise by another court – and therefore we are entitled to have our case heard,” said the union representative.

The ECA regarded the constitution and judicial review as a separate issue, the AECI was happy for the Labour Court to consider the issues, and the NECI had no view on the application for an adjournment.

After private deliberation, the Court emphasised that it has a statutory obligation to hear and determine an application for a variation, and that it must consider an application on the basis of the 1946 Act and presume the Act to be legal and presume that the REA is properly registered. It was also concerned that significant prejudice could accrue to union members – and also that further delay could lead to possible disharmony between employers and employees. On the other hand, there was considerable agreement between the parties that the two main issues could be heard together. Therefore, the Court felt that it was appropriate to deal with the application before it and to not grant an adjournment.

NJIC Accommodation?

After discussion concerning whether oral evidence should be accepted and, if so, the number of possible witnesses, and hence the time required, and when a hearing could in practice be convened, the Court opted to allocate a full week in early January.

The chairman undertook to give a decision as quickly as possible after the hearing and then made an interesting suggestion. “As there are differences between the three NJIC parties, could the time before the hearing be put to good use within the NJIC to reach an accommodation between them?” he asked.

IER understands that this suggestion is to be acted on by the ECA, AECI and TEEU.

CER Appoints ECSSA and RECI for Seven Years

The Commission for Energy Regulation has appointed the Electrical Contractors Safety & Standards Association (Ireland) Ltd (ECSSA) and the Registered Electrical Contractors of Ireland Ltd (RECI) as the new electrical safety supervisory bodies for a seven-year contract period commencing from 5th January 2009. Until this date the current voluntary self-regulatory system will remain in place.

Both bodies will be responsible for the regulation of the activities of registered electrical contractors and will carry out this function on behalf of the Commission. The Commission will work closely with both bodies throughout 2009 to ensure that all required operational procedures are put in place.

The Commission will be responsible for the ongoing audit and inspection of the bodies to ensure that both are compliant with the legislation and meet the requirements of the Commission as set out in the Criteria Decision Document (ref: CER/08/071).

RECI Appointed GSSB

The Commission has also appointed RECI as the Gas Safety Supervisory Body.

RECI intends to form a company limited by guarantee called the Register of Gas Installers of Ireland (RGII) with the sole purpose of operating as the GSSB. The RGII will be a wholly owned subsidiary of RECI and will be responsible for regulating gas installers with respect to safety. RGII will carry out this function on behalf of the Commission.

It is envisaged that the RGII will be in a position to begin registering gas installers from 5th January 2009 and that the regulatory system will become fully operational during 2009. Further information in relation to the new regulatory regime will be made available to gas installers and the industry in the near future.

 

News September 2008

High Court Judgement Reserved on Labour Court Injunction Hearing

At the High Court on Thursday 11th September, the hearing adjourned from 28th July into the application by the Technical Engineering and Electrical Union for an injunction granted to ‘Non-Aligned Contractors’ on 13th June to be lifted was concluded after an additional three and a half hours of submissions and arguments by senior counsel, following which judgement was reserved.

On 13th June 2008, the High Court had awarded an injunction to O’Sullivan & Others (415 named Non-Aligned Contractors, i.e. not members of either the Electrical Contractors Association or of the Association of Electrical Contractors Ireland). This injunction put a stay on the Labour Court from considering a proposed variation to the Registered Employment Agreement in the electrical contracting industry before the REA’s current validity was determined, which had resulted in a further adjournment of the Labour Court hearing that had been adjourned to 16th June from 22nd May.

Submissions were made by senior counsel on behalf of the Non-Aligned Contractors, the National Electrical Contractors of Ireland, and the Labour Court, and a response made by senior counsel for the TEEU. No submission, response or argument was made on behalf of the ECA or AECI.

NAC Submission

Senior counsel for the Non-Aligned Contractors reiterated that Clause 27 Subsection 3 Paragraph C of the Industrial Relations Act, 1946, requires that the Labour Court must be satisfied that parties to a Registered Employment Agreement are substantially representative of the industry.

However, at the time of the electrical industry REA being first registered in 1990, there were approximately 2,500 electrical contractors, of which only around 500 – 20% – were represented by the ECA and AECI, which were the two electrical contractor organisations party to the agreement, along with the TEEU. Furthermore, subsequent changes in the industry have been such that there are now some 4,500 electrical contractors, of which only 420 – less than 10% – are now represented by the ECA/AECI. In contrast, some 950 – or 21% – are now represented by the NAC/NECI.

“Some electrical contractors may not even be aware of the application for a variation, even though they are statutorily obliged to comply with the REA and that failure to comply makes them subject to criminal prosecution,” she said. “The risk of serious injustice is clearly apparent. One contractor has already been prosecuted and such prosecutions are continuing.

“None of my clients are party to the agreement but they are bound by it – and yet they cannot run their businesses economically if they comply even with the current basic rate, apart from the proposed increase. What are additionally onerous are the additional payments that must be paid, such as the €168 per week for maintenance for work over 11 miles from base, and the travel time of 1.75 hours per day for a job up to 11 miles from base – which still has to be paid even if the employer supplies a van and drives the employee there!

“In addition, there is sick pay, for which electrical contractors are bound by the REA to the terms of another sectoral agreement – that for construction – to which not even the three parties (ECA, AECI and TEEU) had any input.”

(At this point, senior counsel for the TEEU interrupted to claim that: “a critique of the merits of the agreement cannot influence this case”. However, the judge reiterated the points that the Non-Aligned Contractors see the REA has having penal terms and also ties them to another agreement.)

Counsel then continued: “On 22nd May a huge number of contractors were saying to the Labour Court that the agreement is invidious – and one would have thought that the Labour Court would be concerned that the agreement was equitable. In summary, however, the Labour Court’s position was that: ‘We are going to deal with the variation first’ and the hearing was adjourned to 16th June – insufficient time for us to prepare affidavits and creating a huge logistical gulf.

“My clients sought further time, but this request was refused. One client sought application for a meeting and again this was refused. All the indications were that the variation would be accepted on 16th June and on that basis the injunction was sought. A stay was granted but made returnable the following week – my clients issued a motion seeking an interlocutory injunction and simultaneously the TEEU issued the motion now before us.

“The undertaking sought (by the TEEU) as to damages re the loss of wages that would allegedly be suffered is brought because the Labour Court cannot rule on a variation on a retrospective basis. There is an issue as to whether an application for a variation can be made at all at the time that it was – but I will return to that later. My clients’ position is that not all electrical contractors can afford to pay the proposed increase – ipso facto they cannot afford to give such an undertaking.

“I do not dispute that this Court has jurisdiction to request an undertaking, but what is more relevant is the suggestion that this is a given. My submission is that it is not a given but is within the discretion of the Court.”

After citing case law, she continued: “It would be invidious to expect my clients to give undertakings that would subsidise other contractors. Two of my clients have offered it on affidavit to their own employees. My clients have also suggested that the AECI/ECA members should, in fairness, give undertakings on behalf of their own employees – but they are refusing either to pay the proposed increases or give undertakings. The AECI/ECA members are entirely at liberty to pay the increases sought, but they are not prepared to, so you can see the invidiousness of my clients’ position.

“Electrical contractors have not been aware of the agreement but are being subject to investigation and enforcement proceedings; the current economic situation now makes it impossible to apply the agreement; and, in addition, as a result of a judgement by the European Court of Justice, cross-Border and other out-of-State EU contractors and their employees are not subject to the agreement.

“Clause 24 of the agreement sets out a formula to be applied in September to reach a figure to be applied from 1st April of the following year – and clearly infers that application for variations must be made to the Labour Court after 1st September and before 1st April for determination and registration. This year application was made to the Labour Court on 9th April, but there is no provision in the agreement for parties to make applications on 9th April – the ‘window’ had passed for this year. It is now open to the parties to agree a proposed increase and to apply for it to be determined and registered for implementation from 1st April 2009.

“The parties to the agreement cannot seek to fudge the agreement when it suits them. Their case for an undertaking is based on acceptance of the fact that the Labour Court cannot register a variation retrospective to 1st April! Employees can suffer no loss because there can be no increase until 1st April 2009.”

She concluded by advising that written submissions had been made regarding the validity of the agreement, public law, and constitutional issues, and, at the request of the judge, highlighted particular sections for the judge to consider.

NECI Submission

Senior counsel for the NECI commenced: “At this juncture I represent over 530 electrical contractors. My clients have identical interests to those of the Non-Aligned Contractors – we may not make their constitutional arguments, but we agree on every other respect.

“I have a difficulty with the TEEU making this application at all. The union has not and will not suffer any loss and it makes no case on affidavit of suffering any loss … In Mr Wills’ affidavit, the union has pledged to take its grievance to the Labour Court under industrial relations law. That is the appropriate response and that should be the end of it. The union could also legally engage in industrial action.

“No workers have sworn affidavits and none of my clients’ employees have made hardship cases to them. There is no evidence that workers are suffering severe hardship.”

Referring to the 22nd May hearing as “heated”, he said: “The Labour Court was determined to proceed, notwithstanding submissions by two junior counsel and notwithstanding the presence of several people wishing to give oral evidence. The Labour Court approach was oppressive and unfair and it was shutting my clients out on that occasion. Manifestly there was a huge opposition to the application on the day – even the AECI adopted a neutral position.

“If the variation had been proceeded with on 16th June – and clearly it would have been – my clients would have been put out of business, as evidenced by a number of affidavits to this Court. Businesses are being decimated by the existing agreement – never mind the proposed variation – and it will be to the detriment of my clients if the injunction is lifted.

“The balance of convenience clearly favours my clients and the Non-Aligned Contractors. Also, there is no appeal on what the Labour Court does – another factor that goes to the balance of convenience. This case is about issues of law, not damages. An undertaking as to damages has become a rule of practice, but is not a statutory rule.”

TEEU Response

Responding to the above two submissions, counsel for the TEEU said that: “The effect of the stay made it inadmissible for the Labour Court to consider not only the variation but everything, including cancellation of the agreement – the very issue that they want considered!

“Courts decide on the balance of convenience on the assumption that there will be an undertaking as to damages. Undertakings are often given by people who do not have the means to honour them.

“There is a high level of presumption being made in this case. If the Labour Court considers the variation, it has a statutory obligation to refuse the application if it considers that the parties making the application are not substantially representative.”

The judge intervened to ask: “Are you saying that the Labour Court would have to consider ‘substantial representation’ when considering a variation application?”
Counsel replied: “If the Labour Court were to act properly under Section 28. We do not know what the Labour Court would have determined in relation to the variation application … It is within the discretion of the Labour Court whether to take the variation or cancellation issue first.”

Labour Court Response

Counsel for the Labour Court said: “There is a contested question of fact as to what occurred at the 22nd May hearing as between what Mr Duffy (Chairman of the Labour Court) asserts on affidavit and what (counsel for the Non-Aligned Contractors) asserts – and you cannot determine today on this issue of fact.

“The Labour Court made clear that both the issues would be taken at the same meeting and that the issues of cancellation would be taken into account when considering the variation application.”

NAC Response

Counsel for the Non-Aligned Contractors responded that: “It is clear that there are two separate issues and counsel for the TEEU’s assertion is clearly contrary to the Labour Court’s own proposal to consider the variation and cancellation separately.

Judgement in the case was reserved.

FOOTNOTE:
Irish Electrical Review was present at the Labour Court hearing on 22nd May 2008 and reported as follows: “At the Labour Court on 22nd May, when adjourning the hearing to 16th June, Chairman Kevin Duffy had indicated that the Court could then decide to determine on the application to vary the REA, while separately continuing to consider after that date submissions that the REA itself is invalid – if not from its first registration in 1990 then from recent times due to changed circumstances and representation levels by bodies within the industry.”

 

News July 2008

High Court Adjourns Labour Court Injunction Hearing to September

At the High Court on Monday 28th July, an application by the Technical Engineering and Electrical Union for an injunction granted to ‘Non-aligned Contractors’ on 13th June to be lifted was adjourned until 11th or 12th September 2008, due to there being insufficient time on the day to complete the submissions and the unavailability of Senior Counsel for the remaining three days of the legal term.

On Friday 13th June 2008, the High Court had awarded an injunction to O’Sullivan & Others (415 named Non-aligned Contractors, i.e. not members of either the Electrical Contractors Association or of the Association of Electrical Contractors Ireland). This injunction put a stay on the Labour Court from considering a proposed variation to the Registered Employment Agreement in the electrical contracting industry before the REA’s current validity was determined, which had resulted in a further adjournment of the Labour Court hearing that had been adjourned to Monday 16th June from Monday 22nd May.

Party Positions

The 28th July High Court hearing did not commence until 12.30pm, when Counsel for various parties briefly outlined their clients and their positions. The TEEU sought the lifting of the stay or, in the event that it was to continue, for the applicants (the Non-aligned Contractors) to be required to give an undertaking as to payment of damages in the event that the proposed craft basic rate increase of €1.05 was subsequently registered.

The position of the Labour Court was one of “qualified neutrality”, while that of the AECI was “neutral as to the outcome of this application”. The Non-aligned Contractors opposed the lifting of the stay, as did the National Electrical Contractors Ireland.

On the public benches, those attending from the Non-aligned Contractors and NECI sat together in the back row, while those from the TEEU, ECA and EPACE sat together in the row in front. (IER sat alone to the side of the Court, its position being “unqualified neutrality”!)

TEEU Submission

Senior Counsel for the TEEU spoke for over an hour and a half, outlining the background to the Registered Employment Agreement, the variation agreed on 14th March 2008 between the TEEU, ECA and AECI, the 22nd May Labour Court hearing on objections to the proposed variation, and the injunction granted by the High Court. During the submission he highlighted sections of various affidavits lodged. He then addressed, with references to case law, the TEEU’s right to be given undertakings as to damages.

"There is a serious question as to who the applicants represent,” he said. “What is at issue here is the enforceability of Registered Employment Agreements down through the years. The applicants have effectively brought the Agreement to a standstill as far as the electrical contracting industry is concerned. Their application to cancel the Agreement was to be considered (by the Labour Court) on 16th June. The public interest in this case is synonymous with those who would benefit under the Agreement, if (the variation is) registered. In the absence of an undertaking (for damages) being given, the stay should be lifted.”

Judge’s Questions

A 90-minute lunch break enabled the judge to read all the affidavits lodged except one, a lengthy submission by Denis Judge of NECI.

During the TEEU submission, the judge posed a number of pertinent comments and questions, including: “So the applicants are among the 4,500-plus electrical contractors but not the 400 ECA/AECI members?” “Is there to be one hearing or two hearings – it is in the singular here?” (This referred to the two issues before the Labour Court – the proposed variation and the validity of the REA.) “If the applicants are ultimately successful, what is the effect – and what would happen if monies were paid pursuant to it?”

Labour Court Submission

Senior Counsel for the Labour Court said: “My clients do not suffer any loss, and clearly are not in a position to seek an undertaking as to damages. They will be contesting all the reliefs sought by the applicants at the trial of these proceedings.

“My client raised queries as to the status of the applicants. How many of them are currently employers?” After quoting from an affidavit, he continued: “Now we have gone from ‘employers’ to ‘employers, former employers and potential employers’. There is an onus on the applicants to establish who they are.”

Non-aligned Contractors Submission

Senior Counsel for the Non-aligned Contractors said: “I represent some 400 electrical contractors. Some have been prosecuted in situations where they were not aware of the Registered Employment Agreement.

“My clients were effectively bounced into Court. The Labour Court said by 11th June that it would deal with the variation ‘come what may’ – in clear breaches of fair procedures. Some 700 electrical contractors were represented at the Labour Court meeting, and they did not get a voice in the short space of time.

“Neither independent electrical contractors nor NECI members are party to the agreement but are bound by it – and can be criminally prosecuted if they do not adhere to its terms.

“The Labour Court was not prepared to consider the validity of the Registered Employment Agreement before proceeding to consider the proposed variation.”

Hearing Adjourned 

By this time it was 4.10pm and when the judge asked Counsel how long her submission was likely to take she replied: “If (Senior Counsel for the TEEU) can speak for one hour and a half, I am certainly going to speak for half an hour.”

Counsel for the NECI would also then have to make his submission.

The judge emphasised the desirability of the matter not being delayed and said: “I am available until Thursday, but more than likely I will have to reserve my judgement, to be fair to everybody.”

However, Senior Counsel for the TEEU and the Non-aligned Contractors were not available for the remainder of the week, and the judge therefore determined that the hearing be adjourned until Thursday 11th or Friday 12th September 2008.

Labour Court Adjournment

At the Labour Court on 22nd May, when adjourning the hearing to 16th June, Chairman Kevin Duffy had indicated that the Court could then decide to determine on the application to vary the REA, while separately continuing to consider after that date submissions that the REA itself is invalid – if not from its first registration in 1990 then from recent times due to changed circumstances and representation levels by bodies within the industry.

Monday 16th June had been the next date available to the Court, other than adjourning the hearing into the autumn. The Chairman stated that, while this gave only a short time to the parties contesting the variation application to assemble evidence and affidavits to support their contentions, the Court wished to be fair to all parties and was conscious of the fact that: “We can only register any agreed pay rate from a current date.”

This was counter to the TEEU representative’s assertion that any pay award would be retrospective to 1st April 2008.

Strike Ballot

Meanwhile, the Technical Engineering and Electrical Union has begun holding a national strike ballot in the event that the agreed increases are not paid. “This will lead inevitably to industrial action against any non-compliant employer who fails to pay the agreed increases,” it says.

NECI Website

On its website, NECI claims to have become the largest electrical contractors representative association in Ireland.

“We have now crossed a major milestone and have become the largest representative organisation for Irish electrical contractors,” it says. “Supporters are still joining and the bigger we get the stronger our collective voice will be. No longer will others make decisions for the 90% of contractors who up to now had no voice.”

Industry Numbers

There continue to be widely varying claims as to how many electricians work in the industry.

The TEEU asserts that “there are over 10,000 workers employed in the electrical contracting industry”, while NECI estimates that the TEEU has 8,000 members working in the industry compared to an estimated 28,000 electricians in total.

NECI Warns of Job Losses

On 22nd June, NECI had issued the following statement: “The injunction was granted by the High Court on 13th June to prevent the Labour Court from varying the Registered Employment Agreement in the electrical contracting industry until such time as the REA’s validity is proven, as the employer parties to the agreement only represented an estimated 10% of the industry.

“The proposed increase will mean that employing an electrician, just qualified out of FAS, working for 39 hours a week, for one year including pension, PAYE, PRSI and holiday pay, will cost the employer €71,062.24 per year. That is without any safety training or safety equipment or safety clothing being provided.

“This is simply unrealistic in today’s economic climate. NECI says this proposed increase will only lead to massive job losses within the industry and the winding up of many long established electrical contracting firms. Realistically we should be talking about pay freezes and trying to maintain employment in our industry. These rates are simply unobtainable outside the big cities and by contractors working in the domestic side of the industry.

“NECI wants a grading system to be implemented, whereby top performing experienced electricians can be rewarded much more than what the existing REA allows. Today, based on the REA, top performing experienced electricians only receive 75 cent per hour more than the newly qualified inexperienced ones. The old pre ‘Celtic tiger’ grading system works on a time served basis and not on quality, experience and qualifications, as we would like it to be based upon.

“It is the opinion of NECI that this REA is flawed from its inception, as the parties who negotiated and signed this REA were not ‘substantially representative of such workers and employers’ as per Section 27 (3) of the Industrial Relations Act, 1946, which states clearly: ‘(c) that the parties to the agreement are substantially representative of such workers and employers’. They only represented an estimated 10% of the industry.

“Pursuant to Section 29 of the Agreement, it is provided that: ‘(2) The Court may cancel the registration of an employment agreement if satisfied that there has been such substantial change in the circumstances of the trade or business to which it relates since the registration of the agreement that it is undesirable to maintain registration.’

“The entire industry has gone through radical change since 1990, when this REA was registered. Preliminary results of NECI’s national survey clearly show that 90% of the industry do not know, or have never been educated correctly, about the REA or on their legal requirements and responsibilities to their employees. It is our goal to ensure that a certified educational programme be implemented across the entire industry on a new balanced and fair national Registered Employment Agreement.

“The apprentice ratio, only allowing a company to have two apprentices to every qualified electrician employed, thereby ensuring excellent training practices and quality of workmanship for the apprentice, and ensuring excellent workmanship for the customers, has not been adhered to or regulated in such a long time. Many companies now have 20 or 30 apprentices to every one qualified electrician employed and are using this system to keep down costs.

“The issue of the throughput of apprentices leaving FAS every year, flooding the industry with poorly trained and expensive to employ electricians, due to the REA agreement, must be addressed urgently. Their only option for work within the industry is to become contractors themselves, taking on apprentices, and as you know, poorly trained craftsmen training apprentices leads to very poor and dangerous electrical work being carried out.”

TEEU Response

On 16th June, following the granting of the injunction by the High Court and the consequent adjournment of the Labour Court hearing, the Technical Engineering and Electrical Union had issued a statement (subsequently revised) accusing “non-compliant employers” of trying to undermine the national REA in order to defer paying workers.

“Non-compliant employers are showing gross disrespect to our union, the courts and over 10,000 workers by their efforts to frustrate a tried and tested system for setting pay and conditions in the electrical contracting industry,” said Dan Miller, TEEU Assistant General Secretary.

“This organisation, which does not even have a negotiating licence, obtained an injunction on Friday that was only served on the Labour Court late that evening, long after the close of business, and was only received by us at 9.00 am this morning, an hour before the Labour Court was due to sit. As far as we are concerned it is an attempt by a group of dissident electrical contractors to frustrate a system that has worked well for over 60 years in meeting the needs of workers and employers in the industry.

“It is no coincidence that some of these contractors have been found to be in breach of employment rights legislation… This is yet another example of the growing trend by some employers to use the law to undermine and frustrate our voluntary industrial relations system.

“However, they are misled if they think these tactics will buy them time in terms of having to pay increases already agreed for the industry by contractors representing the majority of employees and the TEEU, which represents those workers. The TEEU executive is to consider holding a national strike ballot in the event that the agreed increases are not paid. This will lead inevitably to industrial action against any non-compliant employer who fails to pay the agreed increases.”

The TEEU claimed: “There are over 10,000 workers employed in the electrical contracting industry. This covers all electrical work involving the installation and care of plant and electrical networks. It covers industries as varied as power generation, construction and manufacturing.”

NECI Steering Group

A well-attended meeting of the new National Electrical Contractors (Ireland), which had been held on 7th June at the Radisson Hotel in Athlone, had elected a steering group to address the NECI’s opposition to the Registered Employment Agreement and to prepare for the adjourned Labour Court meeting.

At the Athlone meeting, NECI representatives stressed that their objective is to be involved in the negotiations for a new Registered Employment Agreement that is fair to all employers and workers in the sector – and not, as claimed by some parties, to reduce all electricians’ pay to the minimum wage. NECI is seeking “a proper and fair grading system for electricians in the new agreement where top-performing employees could be paid more than the existing rates”.

NECI also aims “to gather the support of the many companies who have never been educated in their responsibilities under the existing Registered Employment Agreement. NECI has been shocked by the level of companies who are operating in the industry and who know little or nothing about the agreement.”
NECI’s short-term aims and objectives are cited as follows:

NECI stresses that the purpose of this act is not to reduce the industry to a ‘free for all’ but rather to ensure a level playing pitch for all contractors and to ensure fair conditions of employment for workers. “We envisage that a new REA will be properly representative of all electrical contractors and establish fair conditions and terms of employment for all workers and all employers, not just the contractors who are members of the ECA and AECI.”

NECI claims that: “The operation and imposition of the current REA has caused severe hardship and loss of employment in the industry and is anti-competitive. It has caused severe stress and upset and has caused cancellation of contracts for electrical contractors.”

NECI Meeting Forms Steering Group

A well-attended meeting of the new National Electrical Contractors of Ireland, held on 7th June at the Radisson Hotel in Athlone, elected a steering group to address the NECI’s opposition to the Registered Employment Agreement and to prepare for the adjourned Labour Court hearing on Monday 16th June 2008.

In addition, several county meetings are being held to gather support for the new organisation.

At the Athlone meeting, NECI representatives stressed that their objective is to be involved in the negotiations for a new Registered Employment Agreement that is fair to all employers and workers in the sector – and not, as claimed by some parties, to reduce all electricians’ pay to the minimum wage. The NECI is seeking “a proper and fair grading system for electricians in the new agreement where top-performing employees could be paid more than the existing rates”.

The NECI also aims “to gather the support of the many companies who have never been educated in their responsibilities under the existing Registered Employment Agreement. NECI has been shocked by the level of companies who are operating in the industry and who know little or nothing about the agreement.”
The contact for the NECI Steering Group is Denis Judge, Tel/Fax: +353 (0)90 964 5544, Mobile: +353 (0)87 254 0080.

 

News May 2008

Labour Court Adjourns REA Decision to 16th June

At the public hearing of the Labour Court on Thursday 22nd May 2008, held to consider the contested application to vary the Registered Employment Agreement for the electrical contracting industry, Chairman Kevin Duffy adjourned the hearing until Monday 16th June 2008.

He indicated that the Court could then decide to determine on the application to vary the REA, while separately continuing to consider after that date the contentions made that the REA itself is invalid – if not from its first registration in 1990 then from recent times due to changed circumstances and representation levels by bodies within the industry.

Monday 16th June was the next date available to the Court, other than adjourning the hearing into the autumn. The Chairman stated that, while this gave only a short time to the parties contesting the application to assemble evidence and affidavits to support their contentions, the Court wished to be fair to all parties and was conscious of the fact that: “We can only register any agreed pay rate from a current date.” This was counter to the TEEU representitive’s assertion that any pay award would be retrospective.

Applicants

The application to vary the REA to provide for a €1.05 per hour increase to the existing craft basic rate was initially made by the three parties to the agreement, the ECA, AECI and TEEU.

At the commencement of the hearing, representatives of the ECA and TEEU confirmed their support for the application. However, Michael Kelly of Galway, representing the AECI, said: “The AECI recognises the method used to determine the rate of increases, but wishes to state an inability to pay at the present time. There is less work being done and one option that electrical contractors have is to let go of operatives – however, these then become self-employed as electrical contractors, creating even more competition.”

At this point, Chairman Kevin Duffy asked: “So are you supporting or opposing the application to vary the agreement, or are you adopting a neutral position?”

Mr Kelly replied: “We have a neutral position because of an inability to pay – but we have to agree to the system for determining a rate increase.”

After the Chairman again asked: “So for the purposes of this hearing are you supporting or opposing the application?” Mr Kelly stated that the AECI had to support the application.

Opponents

Legal representatives of a group of ‘non-aligned’ electrical contractors and of the recently constituted NECI (National Electrical Contractors of Ireland) then set out their reasons for contending that the initial registration of the REA in 1990 was null and void, and that, even if its initial registration was valid, the agreement must now be found to be null and void due to the changed circumstances within the electrical contracting industry.

The REA is based on Section 27 (3) Part C of the Industrial Relations Act, 1946, which states that the Labour Court must be satisfied that parties to the agreement must be substantially representative of the bodies for which they are speaking.

The non-aligned contractors’ representative stated that in 1990 the ECA and AECI had a combined membership of about 500 electrical contractors compared to an estimated 2,500 non-members. In 2008 there are more than 4,500 contractors compared to a combined ECA / AECI membership of around 400. “I have here signatures of some 500 non-aligned contractors,” she said. “In addition, some AECI members have signed up in opposition to the proposed amendment. Clearly these contractors were not balloted or consulted before the proposed agreement was made.”

She then stated that the proposed new craft basic rate of €22.54 would be equivalent to a charge out rate of €45.72 per hour. “There is not a building contractor in Ireland prepared to pay €45.72 for domestic electrical work,” she said, “and, indeed, very few prepared to pay €30.00. They can get work done for as low as €20.00 per hour by Polish contractors, for example, who are not subject to the REA and are willing – and are entitled – to do so.”

The NECI representative then urged the Court to accept the previous submission and emphasised that the Court may decide to cancel an existing REA if it is satisfied that the circumstances within the industry have significantly changed.

“The two registration bodies, RECI and ECSSA, have combined memberships of 5,257 electrical contractors,” he said. “Of these, 1,250 are non-employers and as such are not subject to the REA, leaving 4,007 who are. However, the ECA has 60 members and the AECI 360 members, a total of 420 members, and thus together they represent little more than 10% of electrical contractors. The Court should hold an enquiry to explore the origin of the agreement and to establish whether there has been a substantial change in the industry – and should defer making a decision on the present application until such an enquiry has been completed.”

He also referred to Section 33 (1) of the Act, which empowers the Court to restrict the operation of the REA to ECA and AECI members only.

Industry Representation

In response, Chairman Kevin Duffy said: “You both raise serious questions on the validity of the agreement. However, I don’t know how we question a decision made by another Court 18 years ago. A second question is whether this Court should cancel the agreement – we can do so, but this is not part of today’s hearing. This Court is a creature of statute, and we are required to fulfill certain duties laid down by statute, which mandates us to consider such an application as that before us to vary terms of the agreement.

"We want to be fair to everybody. The Court can only consider such questions on evidence – and the onus is on proponents of such propositions to provide such evidence. Clearly, an important part of such evidence would be not only the number of firms engaged in electrical contracting, but also the number of electricians employed by those firms. The purpose of an REA is fundamentally for the benefit of the employees and I anticipate that this will be an argument to be used. Striking down the REA would be a serious matter and the Court would have to be convinced that the circumstances set out by the Act do exist.”

The ECA representative responded that the ECA members were the 60 largest contractors in the State and that they employed over 5,000 electricians. Neither the TEEU nor AECI representatives stated how many electricians their respective organisations each represented.

No doubt, there will be feverish activity within all the representative bodies in the electrical contracting industry over the days leading up to Monday 16th June to maximise memberships, to collate employer and employee numbers that each represents, and to obtain as many signed statements and affidavits as possible.

It should be an interesting meeting!

 

 

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