Industrial Relations in Ireland

"Outline the development and evolution of Industrial Relations in Ireland and discuss the advantages and disadvantages of its current framework."

Presented by:
Dermot Costello

Date: 7h December 2004
Course: Bachelor of Business Studies (Management)
Ref: TA_BMNGT_B
Subject: Industrial Relations Framework and Development

Table of Contents

Table of Contents 2
Executive Summary 3
Statement of research Objectives 4
Methodology 4
Introduction 5
Industrial relations pre-1900 's 5
Industrial relations 1871 to 1906. 6
Industrial relations 1907 to 1922. 7
The Irish State and Industrial Relations 8
The 1960 's & 1970 's 9
The 1980 's and the PRN 10
The 1990 's and The Industrial Relations Act 1990 11
Moving Irish Industrial Relations into the 21st Century 13
Advantages and Disadvantages of the current Framework 13
Conclusions 15
Appendix 16
Biblography 16
References 17
Originality 17

Executive Summary
Before the formation of the state, the industrial relation climate was extremely hostile and in some cases violent. We had the Dublin lockout in 1913 resulting in violent clashes in Dublin and even though the workers were essentially starved into submission, this resulted in the growth of Trade Unionism. Under the Irish state the government sought to regulate the trade union movement and ensure less trade unions though amalgamation and the requirement for a negotiation license. During the 1960 's and 1970 's there was industrial unrest, which was in an economic climate of high unemployment, high inflation and a high level of poverty. This economic condition continued into the 1980 's and improvement began with the Programme for National Recovery as a result of centralised collective agreement. Moving into the 1990 's social partnership continued with a number of other programmes such as the PESP, PCW and Partnership 2000. Also a number of enactments developed voluntary methods for conflict resolution such as the LRC and also provided a legislative framework for industrial action and conflict resolution. The result of this, was a downturn in the number of days lost to strike activity and economic growth. This approach is still adopted by the government today, though we still have some way to go for total social inclusion. Also trade union membership is falling off and there is uncertainty as to who could take there place at the negotiation table should they find themselves in a weakened position.

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Statement of research Objectives
The objective of this project is to outline the development and evolution of Industrial Relations in Ireland and discuss the advantages and disadvantages of its current framework.

Methodology

The methods used in this paper are purely secondary research.

Introduction
Industrial relations commonly denote the relationship between management and employees. Trade unions, the organisations that represent employees first emerged in Dublin, Cork and Belfast during the Industrial Revolutions. Employer bodies also emerged to combat the actions of the trade unions. We will look how this developed over the last number of years.

Industrial relations pre-1900 's

During the 1800 's as the industrial revolution swept Europe, the UK and to a somewhat less extent, Ireland, there was a belief among governments and the management classes that the market and market conditions should be the determinants of prices, wages, profits and economic priorities. Also management styles were based on the scientific approach, where employees were commodities to be dictated to and used as the employer saw fit. Payment was often piece meal based and work was not guaranteed. Typically conditions were poor. However, due to a greater concentration of the population into the cities and working conditions at the time, trade unions were able to emerge and grow.
Trade unions were seen by the management and governing classes as a threat to economic, public and social order and applied legal and social pressures to thwart their efforts. By the beginning of the 1800 's a number of statutory and judicial decisions served to make unions illegal under a variety of headings. In 1780 the Irish Parliament had passed legislation for the suppression of all trade unions, which resulted in the demonstration of 20,000 in Dublin. (Wallace et al. 2004).
Despite these pressures the Unions maintained their influences as some employers elected to ignore the legal scenario and negotiate with them. Several trade unions also continued with strikes, picketing and the destruction of employer 's property to seek their demands but some trade unionists were criminally prosecuted and imprisoned for their activities.
Craft workers in comparison to unskilled workers were relatively well paid which was partly due to the Irish Craft workers trade unions, where were essentially subsidiary of their UK counterparts. (Wallace et al. 2004).
All in all, the Industrial Relation climate was adversarial with the trade unionists and employees on one side and the management classes and Government on the other. Trade unions had to operate in a hostile legal climate as they were considered to be in "restraint of trade".

Industrial relations 1871 to 1906.

Up to 1871 the underlying common doctrine of "criminal conspiracy" was the commanding influence in regulating the employment relationship. However as a result of the "Erle" Royal Commission, which reported favorably on the influence of trade unionism and recommended they be granted legal recognition and regulated, the British Government passed a series of Acts to grant legality to trade unions (from 1871 to 1906). These Acts protected trade unions from court action and recognised collective bargaining and legalised peaceful picketing (Wallace et al. 2004).
The first of these enactments was the Trade Union Act 1871 which legally recognised and defined Trade Unions. However, it did not protect unions from criminal or civil conspiracy actions and therefore picketing continued to essentially remain illegal. Some protection came later in "The Conspiracy and Protection of Property Act 1875" , though while statutory legislation protected peaceful picketing, it continued to be challenged in the courts. A number of famous cases during this period include Allen v Flood that provided for protection and Lyons v Wilkins that found that even peaceful picketing to persuade workers not to work could constitute the illegal "watching and besetting"
In 1906, the government passed The Trade Disputes Act 1906. This Act gave protection against civil or criminal prosecution to actions for the "furtherance of trade disputes", once the actions themselves were legal and protected trade unions against civil allegations committed by or on behalf of the trade union. It defined a trade dispute as "any dispute between employers and workmen or between workmen and workmen, which is connected with employment or non-employment, or with the terms of the employment, or with the conditions of any person and the expression workmen means all persons employed in trade and industry whether or not in the employment of the employer with whom a trade dispute arises." It also legalised picketing where the intention was for the purpose of peacefully persuading any person to work or abstain from working.
During this period unskilled and general workers began organising for better conditions etc. The Industrial Relation climate continued to be adversarial with the trade unionists and employees on one side and the management classes and to some extent the Government on the other.

Industrial relations 1907 to 1922.

The struggle to extend union membership among the general and unskilled workers continued with many repressive measures being taken on behalf of the employers by the police and arms. (Wallace et al. 2004). A number of large confrontations took place in Belfast, Cork, Dublin and Wexford from 1907 to 1911. In 1909 James Larkin established the Irish Transport and General Workers Union (ITGWU). Around the same time a prominent businessman William Martin Murphy established the Dublin Employers Federation representing Employers. On the 21st August 1913, 200 workers who refused to leave the ITGWU were sacked or "locked out" which lead to the famous 5-month conflict called the "Dublin Lockout" involving 404 employers represented by the Dublin Employers Federation lead by William Martin Murphy and 25,000 workers lead by the ITGWU and James Larkin. Murphy was "determined to seek conflict rather than encourage the development of a joint conciliation board" to achieve his goals. Larkin, for his champions "brought orange and green together as never before, for his detractors he was a dangerous megalomaniac, oblivious to the cost of his actions." (Ferriter, 2004).
Larkin, who has learned much of his trade unionism from noted English trade unionists such as Tom Mann, Ben Tillet, James Sexton and Harry Gosling during his apprenticeship on the docks of Liverpool was considered to be both a socialist and a militant. His purpose during this period was to oversee the transition from craft based trade unions to a new and general trade unionism. Another significant figure during this time was James Connolly who, though died for his part in the 1916 rising, was an internationalist socialist. After the violence by the police against the workers during the lockout period (resulting in a number of deaths), specifically most memorably in O 'Connell Street, Connolly set up a "Citizens Army" for the protection of the Dublin Workers.
The employers group eventually won out against the workers by essentially starving them and their families into submission however this directly resulted in ITGWU becoming the largest union in the country with growing membership. During this period the rift between the management classes and working classes became wider and more militant, however the working classes became more organised with trade unionism growing.

The Irish State and Industrial Relations

The first important enactment by the Irish Government with respect to Industrial Relations came in 1941 with the Trade Union Act 1941. This act attempted to reduce the number of trade unions operating in Ireland by introducing the requirement of a negotiating license for collective bargaining and only providing protection to trade unions with such a license, as outlined in the 1906 act. The act made it illegal for any body to carry on negations for the fixing of wages or other condition of employment unless the body held a negotiating license. It also attempted to set up a tribunal with the power to restrict organisational activities by insisting that certain unions would represent certain individual classes, though this did not survive a constitutional challenge. The 1937 constitution guarantees the "rights of citizens to form associations and unions" and in the case National Union of Railwaymen v Sullivan this part of the 1941 act was deemed unconstitutional. The constitution also guarantees the rights of citizens not to join a trade union, if they so desire thus making it illegal for unions or employers to insist on membership of a union.
The Industrial Relations Act 1946, established the Labour Court for the prevention and settlement of industrial disputes and the Joint Labour Committees as an advisor to the Labour Court with regard to conditions of employment and minimum rates of pay. Sean Lemass TD (Minister for Industry and Commerce) believed in trade union involvement in the development of national policy, which in turn would help to avoid industrial disputes. This Act supported both the trade union movement and the principal of collective bargaining. Agreements through collective bargaining could be registered with the labour court for application to all relevant parties to the agreement.
In 1959 the Irish Congress of Trade Unions (ICTU) was established to represent the vast majority of Trade Unions operating in the country. Up to this point there was a split in the Trade Union movement in Ireland with James Larkin 's Worker 's Union of Ireland (WUI) one side and the ITGWU under the leadership of William O 'Brien on the other. (Larkin had since left the ITGWU and formed the WTO). Once this split was resolved the ICTU came into being. Since 1945 to 1959 union membership had nearly doubled to more than 300,000 members and a workforce density of more than 40%.

The 1960 's & 1970 's

As Ireland emerged from the depression and economic activity increased during the 60 's, there was an increase in working days lost due to strike activity as workers sought to improve wages and conditions. In response to this the Industrial Relations Act 1969 made amendments to Labour Courts and established the Rights Commissioner service. The function of the Rights Commissioner was to "intervene in and investigate industrial disputes with a view to promoting settlement."
The Industrial Relations Act 1976 brought agricultural workers into the scope of previous enactments. (Wallace et al. 2004)
The Trade Union 1971 Act put further restrictions on the Trade Union movement, discouraging the formation of new Unions by requiring an 18-month advanced notice period to the Minister for Labour and ICTU before the issuance of a negotiation license. It also required a minimum of 500 members at time of application as well as IR£5,000 to be on deposit with the High Court. The Trade Union Act 1975 increased the minimum membership requirement to 1000 and upped the deposit to the High Court to IR£20,000. It also encouraged the amalgamation of trade unions by providing funding for successful mergers. This allowed the government deal with less unions, when it came to collective bargaining. During this period the Government sought to reform collective bargaining with the introduction of national agreements on pay and related employment issues. This was contrary to the approach being taken in the UK at the time, which was based on decentralised or local bargaining. It was initially seen as an important vehicle to deliver wage restraint, reduce industrial conflict, lower inflation and create a new era of co-operation and harmony in the workplace. However, it failed to deliver. Inflation continued to rise, wages drifted and industrial conflict continued, leading to the social partners abandoning centralised bargaining and returning to decentralised bargaining in 1982. (McDonagh, 2003)

The 1980 's and the PRN

This period also brought economic difficulties with the advent of the oil crises ultimately leading to a severe downturn in the Irish economy in the 1980 's. In the 1980 's inflation and interest rates continued to rise and companies went under due to the economic climate. Taxes also climbed. From 1982 to 1987 decentralised bargaining was the policy and Government relations with the trade unions were poor. There were a series of defensive strikes during the 1980 's leading to a peak in the number of workers involved. However the number of works lost due to strikes declined from the 1970 's and through the 1980 's. This may be due to unsuccessful strikes as well as to the resumption of collective bargaining in 1987.
A Commission of Inquiry on Industrial Relations report which was published in 1981 and which was largely ignored by the government until 1987 stated that voluntary means alone were incapable of importing the required degree of order to the collective relations between trade unions and employers and suggested that certain procedures should be made apply before industrial action could be taken, such as balloting of members etc. It suggested that there should be a stronger legislative framework developed to curb the undesirable consequences of the rising level of industrial action in the previous 1960 's and 1970 's. In 1987 the Programme for National Recovery (PNR) contained a three-year agreement with the social partners on pay, economic and social policy including plans to reduce the debt/GNP ratio. It included the provision of health services, education and housing to the disadvantaged. The PRN committed the Government to working with the social partners to provide a "better framework for collective bargaining and dispute settlement and help create conditions for employment-generating investment". The result of this collective bargaining untimely lead to the Industrial Relations Act 1990.

The 1990 's and The Industrial Relations Act 1990

The Industrial Relations Act 1990 repealed the Trade Disputes Act, 1906 and re-enacted some of its main provisions. It put in place "an improved framework for the conduct of industrial relations and for the resolution of trade disputes with the aim of maintaining a stable and orderly industrial relations climate." It introduced the requirement for pre-strike ballots, restricted the use of injunctions in trade disputes and facilitated further rationalisation of the trade union movement. It replaced the immunity laws of the 1906 act, giving trade unions and their members better protection from civil and criminal prosecution. It also provided for the establishment of the Labour Relations Commission (LRC) with the responsibility for the promotion of good industrial relations. The LRC provides specific free services to promote positive industrial relations in Ireland. These include: o An Industrial Relations Conciliation Service which is a voluntary process used by employees or employers to resolve disputes using a neutral, external, professional mediator. o A Rights Commissioner Service, an independent service that investigates disputes, grievances and claims made mostly by individuals or small groups of workers against current legislation such as Industrial Relations Acts, Unfair Dismissal Acts, Maternity Acts etc. o An Advisory, Development and Research Service which audits and advises companies, employers and unions as to best practice and legislation to ensure good industrial relations. It typically works in non-dispute situations. (Irish Times, 2000)
This is a powerful dispute resolution tool and the 1990 act stated the Labour Court should not normally investigate a dispute unless the LRC states that it is satisfied it has exhausted the voluntary negotiation process for resolution and got no result. With regard to centralised bargaining, there were also a number of collective partnership agreements following on from the PRN. These included: o Programme for Economic and Social Progress (PESP) from 1991 to 1994, which provided for a 3.5% annual pay increases, reduction income tax and kept Government spending in check. I also included the provision for the improvement of community based services and education. o Programme for Competitiveness and Work (PCW) from 1994 to 1997 which continued to regulate pay increases (2.5% p.a.) while agreeing to reduce taxation for the lower paid workers. It also included improvements for small businesses. o Partnership 2000 from 1997 to 2000, which provided for wage increases on approx 2.25%p.a, the adoption of the national anti-poverty strategy (NAPS), provisions to tackle unemployment and IR£525 million to be spent on social inclusion. It also reduced tax by IR£900million including corporation tax.

The 1990 's saw economic growth and prosperity which lead to the "Celtic Tiger" and a continued downturn in both the frequency of strikes and the number of days lost due to strikes. Towards the end of the 1990 's and early 2000 's there was a slight increase in strikes mainly due to public servants looking to share in the economic prosperity of the private sector and a benchmarking process. Also from the 1980 's through the 1990 's while trade union membership increased, the workforce density decreased from over 55% in 1980 to less than 40% in 2000. This is primarily due to better pay and conditions and a result of the economic upturn, new human resource practices and the amount of foreign company employers who typically are hostile to trade unions.

Moving Irish Industrial Relations into the 21st Century

The collective partnership agreements move forward into the 2000 's with the Programme for Prosperity and Fairness (PPF) from 2000 to 2003 and Sustaining Progress from 2003 to 2004. o The Programme for Prosperity and Fairness (PPF) included IR£1.2 billion in tax breaks and PAYE allowance increases; substantial wage increases (approx 5.5% p.a.) and IR£1.5 billion investment on social inclusion measures including affordable housing. o Sustaining Progress included 2-3% wage increases, provisions to combat poverty, structural reform of the health service and improving employment equality measures.

The Industrial Relations (Amendment) Act, 2001, allows the Labour Court investigate a trade dispute under a number of circumstances such as where an employer will not engage in collective bargaining or where a Trade Union or Employer fail to observe the Code of Practice on Voluntary Dispute Resolution set down in the 1990 act. The Labour court can issue a recommendation in the first instance and a determination in the event of a continuing dispute.

Advantages and Disadvantages of the current Framework

Centralised Collective Bargaining continues to be very much the ethos of the current government and legislation points employers and employees to voluntary resolution of their differences using services such as is provided by the LRC. The Government has regulated the trade union movement providing a legislative framework for the carrying out of trade disputes (balloting etc) while providing protection to unions and members carrying on legal disputes from actions of tort etc. The Government has also put regulation in place to reduce the number of trade unions though amalgamation and through the stringent requirements for new trade unions to receive a negotiation licence. At the same time, human resource practices have improved, as have the conditions of employment.
Economically, Ireland has reduced its debt/GNP ratio substantially since the partnership process in 1987 and unemployment has fallen sharply to what is essentially "full employment". Ireland 's GNP rose sharply in the 1990 's with a decline in 2000 to 2002 due to the world economic downturn. Official and unofficial strikes and days lost to strikes have been on the declined since the early to mid 80 's.

One could argue that the improvement in the economic climate and the reduction in strikes show the advantages of the current framework. Employers and workers have a way to agree and negotiate centralised collective agreements and have a direct input into government policy which effects the wealth of all parties. Voluntary resolution of disputes seems to be working well, with more the 80% of cases referred to the LRC resolved at that level. Economically the country and it 's citizens are better off and recently a report showed Ireland as having the best standard of living in Europe.

Contrary to this the partnership process has been unable to adequately address a number of important socioeconomic issues such as increasing income inequality, spiraling housing prices, low levels of lifelong learning, discrimination against new migrant groups and infrastructure bottlenecks.
Also trade union membership as a percentage of the workforce is declining and while some might see this a positive, I would ask the question who will sit across the table from IBEC and the Government in the partnership process to represent the more marginalised and working class of this society if the trade unions cease to exist. Trade unions have pushed the governments of yesterday and today for a fairer and more socially inclusive society. Trade unions face a number of issues today, in the form of globalisation, a large shift in world political thinking to the right and exclusion of unions by large foreign companies. As worker get better off and HR practices improve, people do not see the necessity of trade unions and quickly forget that it is partly due to the trade unions we have achieved this prosperity.
I believe that trade unions will need to re-invent themselves to be more globally based and politically based. They need to continue to attract members and arrest the decline membership % figures. Common political thinking considers the "creation of (national) wealth more important than wealth distribution" as stated by Tony Blair (UK Prime Minister and Leader of the UK 's "left" New Labour Party). The creation of wealth in Ireland has shown while everybody benefited, the top percentage continue to get the "lion 's" share of the new found wealth.

Conclusions

The development of Industrial Relations in Ireland moved from an adversarial model with employer / worker relations being poor and often ending in violence. In latter years centralised collective agreements leading to the partnership programme have help Ireland to economic growth. This was enabled by the regulation of the trade union movement and the amalgamation of trade unions to allow the government deal with fewer unions as part of the partnership programme. Social partnership looked at more than just conditions of employment and wages but at socio-economic policy in general.
Partnership and the regulation of the trade union movement have lead to reduced strikes and days lost to strikes as well as economic improvement and social inclusion for the less well off. However there is still increasing income inequality among societies classes and issues around infrastructure and fair provision of services such as health and education etc. While partnership continues to address these areas, the weakening of the trade union movement due to falling membership (% of workforce) may imbalance the negotiation process in favour of the employers (typically represented by a strong IBEC) and the politically "right" thinking governments.
For employers in the Industrial Relations environment must be seen as favorable due to centralised bargaining and a cap on raising wages (typically below inflation) as a result of it.

Appendix
Biblography

• Boucher, Gerry et al. (2003) "Having One 's Cake and Being Eaten Too: Irish Neo-Liberal Corporatism." Review of Social Economy, http://www.questia.com/>.
• Coogan, Tim Pat, (2003), Ireland in the 20th Century, Hutchinson, London
• European Industrial Relations Observatory: http://www.eiro.eurofound.ie
• Ferriter, Diarmuid, (2004), The Transformation of Ireland 1900-2000, Profile Books, London
• Frazer, Irene (2004), Industrial Relations – Notes, IT-Tallaght, Dublin.
• Government Publications Office (1990): Industrial Relations Act 1990 – Explanatory Booklet, Government Publications Office, Dublin.
• Gunnigle, Patrick et al,(2002), Human Resource Management in Ireland 2nd Ed.,Gill & Macmillan, Dublin
• Hertz, Noreena, (2001),The Silent Takeover – Global Capitalism and the Death of Democracy. Arrow Books, London
• Irish Times (2000),Business 2000 – The Labour Relations Commission – A brief history of Industrial relations in Ireland, Irish Times, Dublin.
• Labour Court: http://www.labourcourt.ie
• MacDonagh, Joe (2003), Human Resource Management – Notes, IT- Tallaght, Dublin.
• McLernon, Douglas S. (1992) European Labor Unions, Greenwood Press, Westport USA.Wallace, Joseph et al,(2004), Industrial Relations in Ireland 3rd Ed.,Gill & Macmillan, Dublin
• Wallace, Joseph et al,(2004), Industrial Relations in Ireland 3rd Ed.,Gill & Macmillan, Dublin

References

• Ferriter, Diarmuid, (2004), The Transformation of Ireland 1900-2000, Profile Books, London
• Government Publications Office (1990): Industrial Relations Act 1990 – Explanatory Booklet, Government Publications Office, Dublin.
• Gunnigle, Patrick et al,(2002), Human Resource Management in Ireland 2nd Ed.,Gill & Macmillan, Dublin
• Hertz, Noreena, (2001),The Silent Takeover – Global Capitalism and the Death of Democracy. Arrow Books, London
• Irish Times (2000),Business 2000 – The Labour Relations Commission – A brief history of Industrial relations in Ireland, Irish Times, Dublin.
• MacDonagh, Joe (2003), Human Resource Management – Notes, IT- Tallaght, Dublin.
• Wallace, Joseph et al,(2004), Industrial Relations in Ireland 3rd Ed.,Gill & Macmillan, Dublin

References: • Ferriter, Diarmuid, (2004), The Transformation of Ireland 1900-2000, Profile Books, London • Government Publications Office (1990): Industrial Relations Act 1990 – Explanatory Booklet, Government Publications Office, Dublin. • Gunnigle, Patrick et al,(2002), Human Resource Management in Ireland 2nd Ed.,Gill & Macmillan, Dublin • Hertz, Noreena, (2001),The Silent Takeover – Global Capitalism and the Death of Democracy. Arrow Books, London • Irish Times (2000),Business 2000 – The Labour Relations Commission – A brief history of Industrial relations in Ireland, Irish Times, Dublin. • MacDonagh, Joe (2003), Human Resource Management – Notes, IT- Tallaght, Dublin. • Wallace, Joseph et al,(2004), Industrial Relations in Ireland 3rd Ed.,Gill & Macmillan, Dublin