Collective representation a fundamental right
Issued : Tuesday 18 December, 2007
I am glad that we are discussing, this evening and tomorrow, the Labour Party's Party Private Members Bill to amend the Competition Acts. I move on behalf of the Labour Party the Competition (Amendment) Bill 2007. This Bill is, I believe, about the vindication of a fundamental principle, indeed a right: the right to collective representation.
This Bill aims to ensure that legislation cannot be used to undermine the right to collective representation of atypical workers such as actors, musicians, freelance journalists and others from being represented by a trade union or to block representative organisations negotiating with government or national bodies on behalf of their members, as is currently the case.
This means in practical terms that we are seeking to ensure the right to collective bargaining of what can be, and often have been, some of the most exposed workers in the State. These include, although are in no way confined to, members of Irish Equity, members of the Musicians' Union of Ireland and others who have been precluded from negotiating with the people to whom the sell their services as employees by way of collective bargaining. These are often in instances of severe asymmetry, where an individual seeks to negotiate with a large and dominant organisation.
Indeed the issue first arose in the context of the difficulties undergone by members of Equity, the Irish Actor's Union. I raised this matter on the Adjournment of the Dáil at the time, which is now over two years ago.
At that time, the issue centred on the fact that Irish Equity had been forced to sign an undertaking stating the union would not negotiate fees for actors working on commercials for private companies. The rationale given by the Competition Authority, and parroted by the government, at that time was a fear of price-fixing by actors involved in, for example, voiceovers of advertisements on television or the radio.
On Tuesday 15 November 2005, when I raised this issue on the Adjournment, I posed a fundamental question: can an EU Directive on competition that has been translated into Irish law, be used in such a fashion as to undermine the rights of workers to collective representation- rights that have been hard-won and that are enshrined in trade union law and in the Conventions of the ILO, of which Ireland is a signatory?
The Minister at the time, taking a particularly incoherent approach to the issue, took the view that actors be viewed as 'independent contractors' rather than PAYE workers. Of course, the very nature of an actor's employment- as well as other groups affected by this unsympathetic, even hostile, interpretation of legislation, is that given they often lack continuity of employment, such a designation could never be applied in the first instance.
The Minister replying to me on that occasion stated inter alia:
"On the question of whether actors are "undertakings" within the meaning of the Competition Act, I understand that, as a starting point, the Competition Authority considered whether the Revenue Commissioners treated actors as employees subject to PAYE or as independent contractors. The authority's investigation revealed that the vast majority of actors in the State are not treated as PAYE employees. It also considered other factors, such as the following [...]
"Actors providing advertising services generally are not obliged to work for a single advertising agency - they may work for several at the same time. Such actors generally do not receive the benefits one usually associates with a contract of employment. For example, they generally do not receive holiday pay, health insurance, maternity leave, etc."
The upshot of this has been that these actors have suffered serious wage cuts and they have been denied the right to have unions make representations on their behalf or negotiate collective agreements.
The decision by the Competition Authority to use Section 4 of the Competition Act 2002 against actors has immense implications. The fact that the trade union Siptu was forced on the steps of the Court to sign a declaration that it would not represent such actors was a low point in the modern history of Irish industrial relations. While the Competition Authority had begun with actors, all atypical workers could be affected. At a time when there is a drive for the casualisation of work, and when we are already experiencing the abuse of workers provided on an agency basis, we need to vindicate the right to collective representation now more than ever.
The interpretation of Section 4 of its founding legislation taken by the Competition Authority cannot be allowed to stand. As it has been implemented I believe it is inherently wrong, immoral, and in my view, illegal since it is in violation of treaties which Ireland has signed and ratified. We have accepted an international obligation on the fundamental freedoms and rights of workers, and the right to be represented collectively.
In this context, it is surely scandalous to have arrived in a position such as this, wherein an ideological attack on some of the weakest workers in Irish society, to whom we have never given proper recognition through social welfare, pensions or income, has been allowed to come about. Each individual worker, be they actor, musician, writer, photographer or anything else, is defined as a business and not a worker. This is, simply, a violation of the International Labour Organisation convention. It is further, I believe, not in line with a recent, and very important, decision of the European Court of Justice which was asked to adjudicate on the competing rights of transnational commerce and the right of workers to collective representation.
On Wednesday 1 March 2006 I raised with the Taoiseach the implications of what was unfolding in terms of the undermining of the rights to collective representation.
On the 28 March 2006 he replied to me, acknowledging in part, the concerns of the social partners on this issue. In the course of his letter to me he stated:
"The investigation by the Competition Authority was in relation to a possible breach of Section 4 of the Competition Act 2002, which applies to arrangements which have as their object or effect the prevention, restriction or distortion of competition in trade in any goods or services in the state. The legal issues involved are therefore quite complex, in terms of striking an appropriate balance between the differing considerations of competition law, including EU provisions, on the one hand, and the relationship between these considerations and industrial relations law and practice, including the role of collective agreements, on the other.
As you know, Ictu has raised specific concerns about the approach of the Competition Authority in this matter. I appreciate fully these concerns, and I believe that a review of the range of legal and other issues involved would be worthwhile. While the difficulties that these issues present should not be underestimated, I remain optimistic that an appropriate and balanced solution can be developed in the context of a dialogue between the relevant union interests and the Authority against the background of the negotiations towards a new social partnership agreement that are currently underway."
The matter of collective bargaining has been to the fore over recent times. There are two principal issues which have served to highlight the theme.
In an international context, the Viking Line case has attracted attention across the European Union. In this recent decision of the European Court of Justice (Judgement of the Court of Justice in case C-438/05), delivered on 11 December 2007, the Court declared the right to collective representation to be a fundamental right.
This case concerned a Finnish ferry company, Viking Line, which sought to re-flag its ferry in Estonia using low-wage Estonian crews. The Finnish seafarers' unions protested. This had as a result their being taken to court by Viking Line on the grounds that they were interfering with the company's right to provide services under EU law, which is a central tenet of EU law.
In its judgment the European Court of Justice in Luxembourg held that the right to take collective action, including to strike, is a fundamental right and forms an essential pillar of the general principles of EU law and is not subverted by the right of businesses to operate anywhere in the EU.
In the ruling, the European Court of Justice found that Viking Line's right to provide services did not overrule the right of workers to take collective action to protect their legitimate interests.
This is particularly important on the eve of the proclamation of the European Charter of Fundamental Rights which includes the right to collective action and, as we know, will be made legally binding in the Lisbon Treaty.
This is an important ruling with implications for workers all across Europe, including, clearly, Ireland, as it confirms that the right to take collective action to protect workers cannot be subsumed by the right of businesses to operate in other countries. It is also of relevance to the issue at hand on a domestic basis, since it demonstrates moral and legal leadership with regard to the right to strike.
While the European Court of Justice found that strike action constituted a restriction of the right of freedom of establishment, such action was justified because it was done in pursuit of a legitimate aim - protecting the jobs and conditions of employment of union members.
The Competition Authority's interpretation of Section 4 of the Competition Act 2002 and its related court action in the case of Actor's Equity has been rolled on to challenge the right to collective representation in general.
On a domestic level, we have seen the difficulties encountered by members of the Irish Pharmaceutical Union in seeking to negotiate a collective agreement on behalf of its members with the Health Services Executive.
The current dispute between the HSE and the pharmacists over plans to cut the margins for dispensed drugs has been greatly complicated by the refusal of the HSE to negotiate collectively with the Irish Pharmaceutical Union. The HSE has argued that a High Court decision taken by the Competition Authority and brought to the steps of the Court in the case of Actors' Equity prevents it from negotiating with the Irish Pharmaceutical Union, arguing that pharmacists are 'undertakings'.
Such an interpretation challenges not only the right to use its negotiating licence by the Irish Pharmaceutical Union, it challenges the right of all those with a negotiating licence, be it dentists in the Health Service negotiating with the Department of Health or the HSE, or vets negotiating with the Department of Agriculture.
This Bill which I move this evening on behalf of the Labour Party would vindicate the right to collective negotiation in all of these circumstances. It would, I believe, eliminate one of the major obstacles standing in the way of a resolution of the current crisis in the pharmacy sector.
In a letter to all Deputies and Senators, Michael Guckian, President of the MPSI, stated that
"...the Union is prepared to go to the table without any preconditions, or predetermined outcomes and we would hope that the HSE would do likewise. The Union has proposed that talks on a new pharmacy contract, under an Independent Chairperson, should commence immediately. The purpose of these talks would be to reach agreement on all aspects of the contract, including an appropriate pricing structure for the delivery of pharmacy services. This had previously been agreed with the HSE at a meeting ion November. When agreement is reached on an appropriate pricing structure, the matter could then be referred to the new proposed arbitration system, which the Minister fro Health and Children alluded to in the Dáil on 21 November 2007. It is hoped that such a Body or System will provide an independent and fair assessment of all of the issues involved and could then make recommendations to the HSE on pharmacists' remuneration. However there is no indication, as of now, the HSE are prepared to proceed on this basis."
I believe that this offer from the Irish Pharmacy Union should be taken up and that a resolution could be achieved. The passing of this legislation would ensure that it would not be necessary to interrupt the talks at the point of nearing agreement by legal interventions as to whether pharmacists have the right to be collectively represented.
The basic question is whether the person engaged to perform services is performing them as a person 'in business on his own account'. For Competition Act purposes, the test is whether an individual is what the Act refers to as an 'undertaking' defined as a person 'engaged for gain' in the production, supply or distribution of goods or the provision of a service. If he or she is engaged for gain, as opposed to being paid a wage, then the Competition Act applies, and as far as the Competition Authority is concerned, collective agreements are prohibited.
I believe that this interpretation is legally frail as well as being inoperable and recipe for chaos in industrial relations. I also believe that the Competition Authority's reliance on the Revenue Commissioner's definition of 'worker' as that of a PAYE employee to be arbitrary and unacceptable.
The key definition in the Competition Act is that of 'undertaking' which is how atypical workers have been classified. Following this rationale, such workers have effectively been designated as mini-businesses, each with their own contract, with apparently no contact, or connection, to fellow workers. Of course, this bears little or no relation to the reality of the situation.
One has only to consider what the implications of such a view would be in a labour market where not only are there atypical workers, but also there are workers who have been made redundant are who are asked to sell back their services. They do so, of course, at the risk of sacrificing all of the protections and benefits that have been won by trade unions over generations.
This Bill has two principal aims. First, it would enable trade unions to organise and negotiate collectively on behalf of individuals who enter into work under contracts 'personally to do or provide any work or services'- the emphasis being on the word 'personally'.
It would follow that such individuals should not be classed as 'undertakings' for the purposes of competition law. However, self-employed individuals would continue to be prohibited from price fixing against consumer interests.
Second, the Bill allows for collective negotiation and bargaining in relation to the terms and conditions of a scheme whereby services are provided to the public by members of a trade, profession or vocation and paid out of public funds. Section 3 (2), for example, would deal with the position of the Irish Pharmacy Union.
The Bill seeks to change the powers of the Competition Authority by amending Section 4 of the Competition Act 2002 in such a way as to ensure that it does not undermine the right to collective bargaining and representation. It is, I repeat, the Labour Party's view that Section 4 is in breach of European law and the International Labour Organisation (ILO) conventions in relation to the right to collective representation.
It is only right to state at this stage that I believe the Oireachtas never intended Section 4 of the Competition Act be used to undermine trade union statute law and international human rights Conventions. However, that is precisely the position at which we have now arrived.
Unless Section 4 of the Competition Act is changed, under current interpretations many workers will be deprived of some basic protections. At particular risk, as I have mentioned, will be those who are in atypical employment, or those who have been forced onto contract employment.
Further, Sections 3(1) and 3(2) of the Bill specifically enable participants and providers in schemes of public provision paid for out of the public purse to be represented and to pursue collective agreements. It thus, to give a specific and current example, eliminates, I repeat, one of the fundamental stumbling blocks towards a resolution of the dispute between the HSE and the Irish Pharmaceutical Union.
The introduction of this Bill is necessary for further reasons, also, as a means to make sense of, and improve upon, the Competition Act of 2002. If this Act, under the current interpretation of the Competition Authority, were to be applied with full force and effect to trade unions and their members, then trade unions would revert to their old common law status as unlawful "combinations" and trade union leaders would be prosecuted as parties to a criminal conspiracy.
The difficulties we now face arise due to the obsession with a narrow and hegemonic definition of competition by the Competition Authority as well as the government, and an apparent inability to apply any sensitivity or flexibility in circumstances where the notion of competitiveness is clearly misplaced.
The Labour Party is not opposed to competition. There is a role for competition in m any aspects of life. There are also other areas where the guarantee of provision of a service constitutes any reasonable definition of a citizenship right. It is important, however, that competition legislation be interpreted in such a way as does not undermine fundamental rights.
The Competition Act as we currently have it not only encourages competition between entities, but, further, strives to make such competition mandatory. In the view of the Competition Authority, any agreement or concerted practice that has the object or effect of distorting competition is null and void, a civil wrong and also a criminal act. This includes any agreement as to terms and conditions at which work or services are to be provided.
However, both statute law (since 1871), the Constitution and international human rights conventions recognise the right to form trade unions. Further, collective bargaining by trade unions on behalf of their members is actively encouraged as a bedrock of social partnership.
The basis for the problem as I have outlined it is due to the fact that trade union activity is at its heart an anti-competitive activity. Workers do not underbid each other to compete for jobs, nor should they be required to do so. Instead, they organise and bargain collectively so as to obtain the best outcome for all their members. Again organisations of professionals providing a professional service into a public scheme must be accorded the right to collectively suggest, deliver and achieve the best possible service within such a scheme.
I am appealing to all members of the House to support this amending legislation. I believe that it addresses inequities, ones that I would like to believe were never intended, in relation to the position of the most vulnerable of workers. It will also remove one of the obstacles to the resolution of a dispute that the members of the profession involved, and the public in general, are anxious to see resolved.
