The EU Information and Consultation Directive: A boost for workplace democracy in Ireland?

1. The EU Information and Consultation Directive: A boost for workplace democracy in Ireland? John Geary Industrial Relations and Human Resources School of Business University College Dublin Presentation at Leuven University, Belgium 9th November, 2006

2. Presentation Outline • Background and context • Incidence and nature of arrangements for information and consultation • The Irish legislation • Implications • Conclusion: by how much can we expect the conduct of I&C to change?

3. Background and Context • First EU law to generalise the obligation on employers to inform and consult employees (specific situations = collective dismissals, transfer of ownership, EWCs) • Directive – minimum standards of I&C with countries free to adapt its terms to suit local circumstances and traditions of ERs • Mechanism to enhance employee voice in management decision-making and to improve organisational effectiveness • “A fail-safe protection for employees”. Touted also as “a modern business tool” by the EU Commissioner in 2001. “Many businesses already involve employees in (managing change)” • Irish echo: “an exciting opportunity for organisations to use partnership-style approaches to better anticipate & manage change in the workplace… Effective I&C practices can also serve as a catalyst for the development of innovative working practices, culture change and new forms of work (NCPP) • Independent research evidence would confirm same → employers should have little to worry about then?

4. It’s not as simple as that: Ireland (and UK) ‘atypical’ • Act - comprehensive legal code governing information and consultation (I&C) with employees on key business issues • Prospect of enhancing unions’ voice, stepping stone to unionisation, threats to managerial prerogatives and endangering the release of confidential information • Enormous significance for the conduct of employment relations • Different predictions as to practical effect: - ‘transformative’ - ‘damp squib’ - variable and incremental effects

5. Industrial relations background: since mid 1990s I&C promoted in social partnership programmes under the more general rubric of ‘partnership and involvement’ (P&Inv) • No unitary model canvassed – list of possible areas proposed • Rationale for approach adopted

6. Incidence and Nature of Arrangements For Partnership Involvement • Survey evidence (NCPP/ESRI/UCD, 2003) - 42% ‘hardly ever’ receive info on changes in work practices - over ½ ..…. receive financial information - only a ¼ said they are ‘almost always’ consulted before decisions are made which affect their work • Employers claim a high incidence of I&C but employees less convinced of scope and depth • Geary (2006) significant ‘voice and representation gap’

7. The Reach of the Legislation Reach: 150+ employees - March 2007 100+ employees - May 2007 50+ employees - May 2008 Sectoral Reach: Census of building and construction (2003) only includes firms with 20+ employees (N, 50+ = 186) = 27%, but in employment terms accounts for 73% of employees (in firm with 20+ employees) Census of industrial production (2003), includes industrial enterprises with 3+ (N, 50+ = 913) = 18%, but in employment terms accounts for 77% of employees Services industry (2003) (N, 50+ = 1738) = 2%, but in employment terms accounts for 52% of employees

8. The Legislation - definition of terms Information = transmission by the employer to the employee/employee representatives of data in order to enable them to acquaint themselves with the subject matter and examine it Consultation = exchange of views and establishment of dialogue between either or both one or more the employees, their representatives and the employer

9. The Legislation – key features • Allows employers considerable freedom of manoeuvre - employers are not required to act first, but they may if they wish - ‘pre-existing agreements’ - window until 2007:  can be arrived at in any way that suits the parties  do not have to follow negotiation process laid down in legislation  do have to be approved by employees - direct employee involvement is provided for - multiple channels for I&C can co-exist • Employees have to “pull the trigger” – 10% to initiate the process by either approaching employer directly or via the Labour Court

10. Negotiated agreements (under the terms of legislation) • Process for establishing I&C arrangements: - employer may initiate - or once a valid request has been received from employees, employer enters into negotiations with employees or ERs (or both) - critically employer must provide for election/appointment of ERs (where requested) • Negotiated agreements can result in: - an agreement which is more or less to the parties ‘liking’, so long as they establish I&C (latter = exchange of views/establishment dialogue) - or agree to apply the Standard Rules • Does not prescribe the competence of an I&C Forum = voluntary agreement (subject matter not predefined as with Standard Rules)

11. Standard rules are more prescriptive and constraining Come into force where: - parties agree - employer refuses to enter negotiations within the specified timeframe - parties to negotiations cannot come to an agreement within specified timeframe • Requires establishment of a so-called Forum, composed of ERs ≠ direct employee involvement • ERs elected/appointed by employees or by employer with agreement of workforce • Meet twice a year • Competence is clear: Information  recent and probable developments I and C situation and future of employment any anticipating measures envisaged I and C  work organisation & contractual arrangements • Works councils?

12. Other features: • To switch from direct employee involvement to collective representative arrangements – 10% of workforce, subject to approval of the majority of employees to whom direct practices apply • Trade Union Representation - Section 6  permits trade union members to elect/appoint from amongst their members representatives to I&C fora • No defined role for union officers - expert providing assistance, section 14? • Co-operation = spirit of co-operation, due regard to reciprocal rights and duties and take into account the interests of either party • Dispute resolution: Labour Court – appeal to High Court (point of law, decision is final and conclusive) • Penalties = €30,000 or 3 years imprisonment (weak? – decision invalid!) • Confidential information = bound so by. Employer may refuse where to do so would seriously harm functioning of business or be prejudicial to the undertaking

13. Immediate Implications • First time comprehensive legal code for I&C in Ireland • Employers may feel ‘compelled’ to revisit their existing arrangements • Where no provision has been made for I&C, will now have to initiate changes especially where employees move first to ‘pull the trigger’

14. Long-term implications • Government has maintained a flexible approach to I&C • Legality of certain provisions?? 3. Diffusion of I&C arrangements 4. BUT provision for a Standard Model (with some teeth) → encourage employers to reach pre-emptory agreements 5. Union rights and influence? 6. Will the legislation strengthen dialogue and promote mutual trust? 7. Guardianship of the legislation

15. Conclusion By how much will the conduct of I&C change?