EWCs: Irish Labour Court Decisions

Background:

The Irish Labour Court has issued the first decisions involving a European Works Council governed by Ireland’s EWC legislation. These two decisions, which follow a hearing over five days in which both sides were represented by Counsel, involve issues referred to the Court on appeal from the Workplace Relations Commission (WRC) by Mr Jean-Philippe Charpentier, the chair of the EWC in the American company, Verizon. In both appeals, the Court found against Mr Charpentier.

Verizon had had an EWC agreement under UK law, but it expired in October 2020 and negotiations in the summer of 2020 to conclude a replacement had been unsuccessful. As a result of the expiry of that agreement (as judicially confirmed to have taken place by the UK’s Central Arbitration Committee) and the imminent end of the Brexit transition period in December 2020, Verizon appointed an Irish representative with effect from October 2020 and then set up an EWC under the Irish Subsidiary Requirements as set out in the Transnational Information and Consultation of Employees Act, 1996, as amended (the “Act”).

Case I: Payment of the EWC’s expert’s invoice

The first case concerned the payment of an invoice from the German union-side consultancy, EWC Academy, to the chair of the Verizon EWC, Jean-Philippe Charpentier, for €11,200.

The EWC had engaged Dr Werner Altmeyer of EWC Academy to advise it on a number of issues and requested that management settle the account. Management did not deny that the EWC could appoint Dr Altmeyer of the EWC Academy as its expert, that his hourly rate was appropriate or that it should pay for some of his work. However, it did object to paying for all of the items listed on Dr Altmeyer’s invoice, which he had sent to Mr Charpentier as he said in evidence that he “had no contract” with Verizon, even though he was aware of the company’s Irish business address and VAT number.

In claiming that he should be indemnified by the company for the invoice, Mr Charpentier first took the issue to the WRC under section 17A of the Act, which held against him in part and ruled that Verizon was only required to pay 50% of the invoice. He appealed to the Labour Court under section 17B, seeking full payment of the invoice. Sections 17A and 17B allow members of an EWC to claim redress from the WRC, or the Labour Court on appeal, if they believe that that have had their individual legal rights infringed, such as, for example, having been penalised or treated unfairly for exercising their representative role. But they do not provide a mechanism for the redress of a complaint by an EWC itself as a collective body, such as an EWC established under the Subsidiary Requirements. 

During the hearing, Mr Charpentier admitted that he was acting in a “representative capacity” in bringing his claim before the Court. In view of this admission, the Court ruled as follows:

…the Complainant’s submission that he is acting in a representative capacity in bringing the within complaint is effectively a concession that the issues in dispute are collective in nature and are not particular to him as an individual. Section 17, in the Court’s view, is framed so as to afford statutory protection to individual members of EWCs qua individuals. It is not – and was not intended by the legislature – to be a means of progressing disputes that are collective in nature.

The case failed on these grounds, so the Court did not need to consider whether the invoice was justified or not. For the same reasons, it also determined that the WRC had wrongly upheld Mr Charpentier’s original complaint to it in part, and so varied the WRC’s order. As a result, Verizon is not required to pay any of the amounts that it disputed of EWC Academy’s invoice.

Because the appeal failed, the Court also rejected Mr Charpentier’s request for his costs in bringing the case.

Our commentary

The decision in this case highlights the fact that, as we have long held, the “Act” is deficient in not providing a mechanism for EWCs under the Subsidiary Requirements to progress a collective complaint, something the Department of Trade, Enterprise and Employment has consistently denied, but which has now been clearly stated by the Labour Court. 

Deficiencies in the law are never in anyone’s interest and should be corrected as soon as possible. Saying that the deficiency will be corrected as part of new legislation that may be required to implement a revised EWC Directive means that the gap in the law will persist for at least another two/three years. The matter could be cleared up very quickly, and the Department should do so.

The European Commission has already initiated proceedings against Ireland over the issue.

Case II: Payment of training costs

In early 2021, the company organised a virtual training program for the new EWC. It was virtual because of Covid. The program was presented by the former Chair of the Labour Court, Kevin Duffy, a barrister, and Bryan Dunne from the law firm, Matheson. As the Labour Court noted, both are highly regarded employment lawyers, with a deep knowledge of Irish and European labour law.

Mr Charpentier subsequently disputed that the program was “training”. Later in the year, he informed the company that he intended to attend a training program organised by the EWC Academy because he wanted to learn more about “confidentiality”. Only late in the day did he tell the company that he would also be a speaker at the conference on the issue. In all, five members of the Verizon EWC planned to attend the EWC Academy program.

Management, which at the time was in discussions with the EWC about further training, clearly informed Mr Charpentier that it would not cover the costs of his attendance at the conference and that if he wished to go he should book holiday. Nonetheless, he went ahead and attended and then looked for management to cover the costs. Nor did he book holidays. When management refused to agree to pay the costs that he would incur, he and the others referred the issue to the WRC which held against them. Mr Charpentier then appealed to the Labour Court.

Having considered all the evidence, the Court found that the 2021 session given by Mr Duffy and Mr Dunne was ‘training’ within the meaning of the Act. The Court noted the ongoing discussions about further training. The Court commented that decisions on training should be “collaborative”. It accepted the submission of Verizon’s counsel that while management should pay for training, EWCs could not have a “blank cheque” when it came to training costs.

In view of these considerations, and the fact that Mr Charpentier was clearly told beforehand that his costs would not be covered, the Court refused his appeal against the WRC decision. It also refused to consider his request for costs as he had lost his appeal. It is also worth noting that the Court said that the words in the Irish legislation that training “will be provided by the employer” did not appear to be in line with Recital 33 or Article 10.4 of the EWC Directive. 

Our commentary

Unlike the first case, which Mr Charpentier lost because the “Act” did not give the Court jurisdiction to hear a complaint that was, in effect, from the EWC itself, the second case was decided on the facts of the matter as it concerned Mr Charpentier’s individual rights.

Nonetheless, the Court found that management had provided members of the EWC with appropriate training and was in discussions with the EWC about further training. It had therefore acted reasonably in refusing Mr Charpentier’s request to attend the EWC Academy event. Mr Charpentier knew beforehand that his costs would not be covered but, nonetheless, “unilaterally” decided to attend, without booking time off to do so. EWCs, or individual EWC members, were not entitled to a ”blank cheque” drawn on the company to attend any training programs they wished to attend.

The Court’s comment that the words in the Irish legislation that training should be “provided by the employer” are out of line with the Directive may, or may not, be correct. But until such time as the law is changed, they stand.

The Court’s comments that training should be agreed in a “collaborative” manner need to be taken on board. In organising training management should certainly consult with the EWC, or SNB, but if agreement cannot be reached someone has to decide and as the Irish law stands that someone is management. That said, management should ensure that it would be happy to justify its choice if challenged. For example, the Labour Court clearly gave great weight to the fact that Verizon had chosen a former Chair of the Labour Court to lead the training. It’s reasonable to assume that it would have been far harder to justify the training if a member of management had themself given it.

Issues around experts, legal advisors, and training costs will need to be given very careful consideration in the future as it looks likely that the revised EWC Directive, which could be agreed by the end of this year, will require EWC agreements to have provision to cover these issues. This means that all existing agreement will need to be renegotiated. It is also likely that the Article 13 exemption will be ended which would see around 350 undertakings come within the scope of the EWC Directive, and with that its rules on experts and training, for the first time.

Finally …

As we understand it, Mr Charpentier has taken some 15 EWC cases/appeals against Verizon management. He may well try to appeal the Labour Court decisions to the High Court, but such appeals can only be on points of law, not on the facts of the matter. An appeal to the High Court would be costly, running into hundreds of thousands of Euros. Who would fund such an appeal? 

We shall see. 

There will be a discussion on these decisions at our Network Meeting in Brussels on Sept 18/19

Our ‘Preparing for EWCD III’ October training program in Barcelona will expand on this, in detail