Sectoral Employment Orders – an update on the judgement

In early July we posted a piece on the recent High Court decision on Sectoral Employment Orders.

At the time we predicted that the Government could appeal the decision. You can see the full article here. There have been a number of significant updates on this since we last posted. See an overview of the events to date below.

On the 9^th July 2020, The Minister for Enterprise, Trade and Employment confirmed to the Dáil that the government is appealing the High Court’s decision in respect of Náisiúnta Leictreach Contraitheoir Eireann, Cuideachta Faoi Theorainn Rathaiochta v The Labour Court, The Minister for Business Enterprise and Innovation Ireland, The Attorney General (2019 No.280 JR) to the Supreme Court, which is the court that has the final say on all constitutional matters. If the Ministers appeal fails, it will mean that Chapter 3 of the 2015 Act will have no effect and will be deemed unconstitutional and Sectoral Employment Orders will be invalid

On 31st July 2020, Mr. Justice Garrett Simons’ judgement was published, in this judgement Justice Simons placed a 6 month stay on the reliefs related to the High Court’s finding that Chapter 3 of the 2015 Act is invalid having regard to the provisions of Article 15.2.1° of the Irish Constitution. This stay is to remain in force until the determination of the intended appeal.

A risk of injustice can arise in cases of appeal because of the unavoidable time that elapses between the determination of the High Court and the Supreme Court hearing and decision. Justice Simons considered the strengths of the grounds of appeal and the public interest in the enforcement of the law in determining whether or not to impose a stay and on the balance of justice and he felt that the imposition of a stay should be granted in the circumstances. Even the temporary disapplication of legislation would give rise to damage that cannot be remedied in the event that a constitutional challenge does not ultimately succeed.

Justice Simons suspended the effect of the declaration of unconstitutionality for 6 months for the following reasons:

1. The making of a declaration of unconstitutionality with immediate effect is not necessary to ensure an effective remedy in the circumstances.
2. It was not necessary for this case to consider the challenge to the constitutional validity of Chapter 3 of the 2015 Act, the court only proceeded to do so to obtain a ruling on the constitutional issue within the existing proceedings and therefore to lessen the disruption a short suspension was placed on the declaration.
3. It was not declared that that the imposition of minimum rates of pay and renumeration in any particular economic sector is in itself unconstitutional. It would be wholly disproportionate to place doubt on all sectoral employment orders. The main concern is the issue relating to the separation of powers under the Constitution and the proper division of function as between the legislative branch and the executive branch of the Government.
4. The making of a declaration with immediate effect would have “widespread and unpredictable consequences” and doubt would be placed on the validity of other sectoral employment orders under the 2015 Act. A declaration of invalidity would place significant financial hardship on workers should employers refuse to continue to pay the rates set by the orders.

The High Court further announced that the Sectoral Employment Order (Electrical Contracting Sector) 2019, governing pay and conditions for electrical contractors, was not legally valid and was to be set aside with immediate effect. This means that the latest sectoral employment order, which was made by former Minister Pat Breen last year, setting electricians’ pay at €23.49-€24.34 an hour, depending on service, will not apply to electrical contractors.

You can see the full judgement here.

For queries relating to this judgment or other employment law queries, please contact Emer Murphy at emurphy@lavellepartners.ie , Marc Fitzgibbon at , mfitzgibbon@lavellepartners.ie or call us on 016445800.