Ryanair has won its Supreme Court challenge to the Labour Court's decision that there is "a trade dispute" between the airline and its Dublin-based pilots which the Labour Court has jurisdiction to investigate and determine.
The Labour Court must now rehear the matter on the basis of procedures and law laid down by the Supreme Court.
The unanimous judgment of the five-judge Supreme Court is expected to have important implications for the application of new industrial relations legislation, introduced with a view to protecting the position of workers in non-unionised companies such as Ryanair.
The court yesterday ruled that the Labour Court had not followed fair procedures in reaching its decision that it had jurisdiction to decide issues referred to it by Impact, of which the Irish Airline Pilots Association is a part, on behalf of Dublin-based pilots in Ryanair.
In a judgment with which the other members of the court agreed, Mr Justice Hugh Geoghegan ruled the Labour Court did not follow fair procedures and did not have evidence before it to support its findings that: (1) there is a trade dispute between Dublin-based pilots and Ryanair; (2) that it is not Ryanair's "practice" to engage in "collective bargaining negotiations" and: (3) that the airline has no operative internal dispute resolution procedures.
He found the Labour Court had not properly investigated whether there was internal machinery within Ryanair for resolving the problem with the pilots or whether that machinery had been exhausted, nor had it followed fair procedures in allowing complete non-disclosure of the identity of the pilots on whose behalf the union was acting.
Ryanair had appealed the High Court's refusal to overturn the Labour Court findings of January 25th, 2005, which arose after controversial conditions were imposed in 2004 by Ryanair on pilots for retraining for flying new Boeing aircraft.
Those conditions included that the pilots would agree in writing to repay to Ryanair the €15,000 retraining costs if the company was compelled within five years to engage in collective bargaining with a trade union.
Mr Justice Geoghegan said the context of the appeal was that Ryanair had a policy of not negotiating with trade unions, a fact of which all Ryanair employees were well aware. However, Ryanair could not prevent its employees joining unions.
A new legislative scheme - the Industrial Relations (Amendment) Act 2001 and the Industrial Relations (Miscellaneous Provisions) Act 2004 - had been enacted to prevent exploitation of employees in a non-unionised company.
That scheme ensured - where there were no reasonable arrangements for resolving on a collective basis problems between an employer and employees - that there was ultimate recourse to the Labour Court. Ryanair had claimed it did negotiate with pilots via its employee representation committees but could not do so because the pilots' representatives had withdraw from those in 2003.
While the Labour Court was entitled to take the view that "town hall meetings" organised by Ryanair were consultation or information meetings with none of the essential characteristics of collective bargaining, the process by which the Labour Court decided Ryanair's employee representation committees did not form a basis for collective bargaining was "fundamentally unfair" as it did not involve hearing any testimony from the pilots and relied only on trade union documents.
Overall, Mr Justice Geoghegan said there was insufficient evidence on which the Labour Court could find the employee representation committees did not perform the function contended for by Ryanair.
The Labour Court was wrong to conclude, in circumstances where the pilots had withdrawn from the employee representation committee, that it was "not the practice of Ryanair" to engage in collective bargaining negotiations.
If that was correct, the 2001 and 2004 industrial relations scheme could be invoked by a category of employees boycotting whatever collective bargaining machinery a company had in place, he found.
While the Labour Court decision was "an impressive document, it did "betray an understandable mindset" in favour of the way particular expressions were used and particular activities carried out by trade unions, the judge also said. That was an incorrect approach as the relevant legislation was intended to deal with problems arising in a non-unionised company.
