The Supreme Court has ruled that Registered Employment Agreements which set the pay rates for several employment sectors are unconstitutional.
The Supreme Court found that the provisions of Part III of the Industrial Relations Act 1946 unconstitutional, observing that:
there is a wholesale grant, indeed abdication, of lawmaking power to private persons unidentified and unidentifiable at the time of grant to make law in respect of a broad and important area of human activity and subject only to a limited power of veto by a subordinate body ... Nor did the Oireachtas retain any capacity for review either by the Oireachtas or by a member of the Executive responsible to it, of the agreements actually made.
The Supreme Court found that there was no obligation on the Labour Court or the parties to the agreements to consider the interests of the parties who would be bound by the agreements and those who are not parties to the agreements. Moreover, once the agreement is registered it is binding on everyone, and it may only be varied on the application of the original parties.
The Supreme Court found that the Act allowed the parties to an agreement to make any employment related law on the condition that the Labour Court considers such a law to be "substantially representative" of those working in the sector.
Comment: The McGowan ruling mirrors the John Grace Fried Chicken ruling, where the High Court found the Joint Labour Committee wage settings mechanism unconstitutional.
