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'The industrial relations system is flawed and no longer relevant'
Niall Saul, group HR head of Irish Life & Permanent



IF the goal of National Agreements is to foster a period of relative industrial relations calm and wage predictability, then it's hard to argue our successive agreements have been anything but successful.

But if the goal of these Agreements is to support continued economic success, job growth and prosperity by increased competitiveness and delivering much needed organisational change, then it's a different story.

In this context our industrial relations system is fundamentally flawed and no longer relevant to cope with the demands of our fast-moving competitive world.

Over the past 30 years we have seen huge growth in employment legislation, providing extensive protections and rights to employees in areas like equality, equal pay, hours of work, health and safety, information and consultation . . . imposing significant responsibilities on employers.

The industrial relations system however has remained the same old 'voluntarist, irrational adversarial' model it has always been, and the unions appear to brook no challenge to their right to refuse organisational changes, unless it is done on terms of their choosing . . .even if their terms are not reasonable in the context of remaining competitive.

Yet, when we see that unionisation in Ireland now accounts for only 25% of the working population we must question whether their influence in preventing a move to a more rational system is disproportionate and the interests of the majority should get greater weight.

My argument is that greater interest will be served by a system based on rational adversarial arguments, concluding in agreement or binding arbitration.

Whilst National Agreements, particularly the earlier versions, created labour cost predictability, the change agenda has remained heavily adversarial in unionised businesses, even for relatively minor changes (such as the Siptu/Aer Rianta/Ryanair boarding pass issue).

Employers in unionised companies faced with the necessity to implement significant restructuring to stay competitive see several big phenomena come into play.

Union denial or nonengagement, followed closely by delaying tactics seeking to postpone the inevitable are normally the first elements.

Irrational resistance, even in the face of a rational case, frequently emerges. Interunion rivalry can also feature as with the Siptu/Impact relationship in Aer Lingus.

One point of marked vulnerability in the process is the Union General Meeting, where the representatives can fall victim to ambush by those Michael O'Leary refers to as ?headbangers" who push a particularly ?off-thewall" line to ballot, often sticking the Union negotiators with an impossible mandate.

Almost all of these phenomena have their roots in the fact that the industrial relations system is the only area in the commercial arena which has no court of last resort, where a third party can weigh the respective arguments and issue a decision binding on all parties.

This has created a situation of no guaranteed finality.

At its extreme we have seen some cases of major change or dispute go in and out of the Labour Relations Commission and the Labour Court like a revolving door.

In my view this is the fundamental weakness which must be addressed if we are genuine about Sustaining Progress. If this is removed, the disruptive behaviours which feeds off it will disappear.

The answer is to move the system from its 'irrational, voluntarist, adversarial' form to a 'rational, adversarial' system with a binding Labour Court decision if no solution can be negotiated.

I also believe that the timing is right . . . as the information and consultation legislation now coming into force should support a more rational model. Clearly the onus to demonstrate that change plans are sound will fall on the employer, and will be open to test both in the consultancy process and by the Labour Court.

There are several models that could be used; these include a straightforward Labour Court binding arbitration model, a pendulum bargaining model or a model based on a concept of binding arbitration by a 'Labour Court of Appeal'.

If one of these models was followed it would mean even major change negotiations could be brought to finality within three to six months.

At present these type of issues can drag on for over 2 years.

I've had direct experience of this type of approach where it led to a dramatic improvement in the industrial relations environment.

The 'Binding Labour Court' prospect drove a more engaged approach by all.

All this approach does is force the parties to rely on the objective rational merit of their arguments . . . as distinct from relying on the use of force or threats as a means of prosecuting an otherwise unsustainable argument.

It is my strong view that if this move to a 'rational, adversarial system concluding with binding arbitration, if agreement is not reached' were to be adopted as part of Sustaining Progress for the next five years, we would revolutionise the effectiveness of our system.

Building this capacity for organisational change will be an acid test of our maturity as a nation that wants to maintain true competitiveness.




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