Friday 24 May 2019

WRC cases are fast and cheap, but is the current labour relations machinery constitutional?

The Supreme Court ruled that the Workplace Relations Act 2015 can be challenged
The Supreme Court ruled that the Workplace Relations Act 2015 can be challenged

Cian Beecher, Helen Webb and Niamh Fennelly

The Supreme Court has ruled that the Workplace Relations Act 2015 can be challenged on its constitutionality before the High Court. Once an employee and an employer have passed the point where a dispute can be resolved between themselves the next port of call is usually the Workplace Relations Commission (WRC).

With no fees to raise a claim a limited pleading/submissions process, no arduous disclosure of documents process, no requirement to prepare witness statements and a private and fairly informal hearing environment, employees can obtain a decision on their workplace disputes cheaply and relatively quickly. According to the Workplace Relations Commission Annual Report 2017, 92pc of cases received were processed in less than six months.

Employers also benefit from this approach to the process as costs in defending employee claims do not spiral and early or unjustified settlements are not required to protect the company's reputation from potentially damaging allegations.

But are we sacrificing fair procedures and constitutional rights in the name of speed cost savings and expediency? The Supreme Court has ruled in Tomasz Zalewski v Adjudication Officer WRC & Ors [2019] IESC 17 that the Workplace Relations Act 2015 (the '2015 Act') can be challenged on its constitutionality before the High Court.

Why did Mr Zalewski raise a constitutional challenge to the 2015 Act?

Mr Zalewski raised unfair dismissal and non-payment of notice claims at the WRC. Mr Zalewski attended a WRC hearing on 26 October 2016 during which the adjudication officer accepted written submissions and documentation. An application was then made to adjourn the hearing as a witness for the employer was not available. The adjournment was granted but the new hearing date as is usual in the WRC was not scheduled at that point.

A hearing was subsequently fixed for 13 December 2016 but when Mr Zalewski attended the hearing rather than being given the opportunity to cross examine employer witnesses he was informed that the adjudication officer had already issued her decision and that the hearing had been scheduled in error. The written decision of the adjudication officer stated she had given the parties an opportunity to present evidence at the hearing on 26 October 2016 and on the basis of the evidence provided the complaint of unfair dismissal was not well founded.

Mr Zalewski lodged an appeal against the adjudication officer's decision with the Labour Court and entered judicial review proceedings in the civil courts asserting that certain provisions of the 2015 Act under which his claims have to be determined are a breach of his constitutional rights.

The constitutional challenge to the 2015 Act

In the course of the judicial review proceedings in February 2017 Mr Zalewski's lawyers argued that the provisions of the 2015 Act were constitutionally flawed and in breach of his rights to constitutional justice and fair procedures. The specific breaches were said to arise under Articles 34 37 40.3.1 and 40.3.2 of the Constitution and it was also argued the 2015 Act was incompatible with Articles 6 and/or 13 of the European Convention on Human Rights. His lawyers argued that the 2015 Act breaches the Constitution as: 1. WRC hearings before adjudication officers are held in private; 2. Evidence is not heard on oath and there is no penalty for any person who gives false evidence; 3. Adjudication officers are not required to have any legal qualification or experience and the appeal process is to a body which does not require persons to be legally qualified.

His lawyers also contended that the administration of justice under the Constitution was not limited and that Mr Zalewski was entitled to have his claims determined by a court as opposed to within the confines of the statutory scheme set out in the 2015 Act. Mr Zalewski sought an order quashing the decision of the adjudication officer on that basis.

In April 2017, solicitors for the WRC issued a letter stating that the adjudication officer's decision had due to an administrative error been filed as a "decision to issue" rather than "adjourned to further hearing".

The WRC consented to court orders (i) quashing the Adjudication Officer's decision; (ii) remitting the complaint for rehearing before a different officer; and (iii) paying Mr Zalewski's legal costs. It also argued that given the WRC decision was quashed Mr Zalewski could no longer maintain a constitutional challenge against the 2015 Act.

Mr Zalewski did not accept this. The WRC asked the court to overturn the grant of leave for the constitutional challenge arguing that because it had conceded the adjudication officer's decision ought to be quashed Mr Zalewski no longer had legal standing to challenge the constitutionality of the 2015 Act.

The High Court decision - Did Mr Zalewski have legal standing to mount a constitutional challenge?

The High Court ruled that Mr Zalewski had no legal standing to pursue the constitutional challenge as in returning the case to the WRC to be heard by a different adjudication officer Mr Zalewski was not "in real or imminent danger of being adversely affected by the operation of the statute...".

The High Court concluded that if the WRC's own guidance called Procedures in the Investigation and Adjudication of Employment and Equality Complaints had been followed which provides that "each party will have the opportunity to call witnesses to question the other party and any witnesses to respond and to address legal points" the incorrect WRC decision could have been avoided.

In returning the case to the WRC the High Court was satisfied that Mr Zalewski was not in real or imminent danger of being adversely affected by the statute.

However Mr Zalewski was given leave to appeal this ruling to the Supreme Court. It accepted that whether Mr Zalewski had legal standing to challenge the validity of the 2015 Act where the specific decision challenged had been quashed and remitted for a new hearing was a matter of general public importance.

The Supreme Court - the arguments Mr Zalewski contended before the Supreme Court that as the person who made a claim of unfair dismissal and unpaid notice he had legal standing to challenge the constitutionality of the Unfair Dismissals Act 1977 and the 2015 Act.

This was because both Acts required that his claims be heard by an adjudication officer of the WRC - a statutory scheme which he contended was inconsistent with the Constitution and put him in real and imminent danger of being affected by the relevant provisions.

The WRC submitted that Mr Zalewski was not in real and imminent danger of being adversely affected by the operation of the statutes and he was essentially in the same position as a person who had made a claim to the WRC and whose procedure had not yet commenced.

It added that he had not challenged the 2015 Act when he first made the claim to the WRC and had voluntarily made his claim under the statutory scheme which he later sought to challenge.

The WRC argued that this action was akin to a pre-emptive strike against an adverse decision which was not permissible.

It referred to prior case law which requires a court to first consider and decide non-constitutional issues and if this determines the case between the parties the court should refrain from expressing a view on the constitutional issues.

It also referred to the presumption of constitutionality which applies to matters permitted or provided for by an Act of the Oireachtas.

The Supreme Court decision

The Supreme Court unanimously allowed Mr Zalewski's appeal and held that he was entitled to pursue claims that the procedures for determining workplace disputes under the 2015 Act were in breach of the Constitution and the European Convention on Human Rights Act 2003.

It stated that the High Court appeared to have misunderstood the nature of the constitutional challenge and to have considered the legal standing of Mr Zalewski in relation to a challenge based upon a concern or contention that the second adjudication officer would not exercise his or her statutory functions in accordance with the principles of constitutional justice and fair procedures.

The Supreme Court considered that this was not the correct approach and Mr Zalewski's challenge was to the statutory scheme itself ie the provisions of the 2015 Act rather than what an adjudication officer might or might not do under the 2015 Act. As such it could not be said that the issues between the sides had been finally decided by the WRC's decision to have the matter heard by another adjudication officer as Mr Zalewski remained in the position of having his claims potentially decided under a statutory scheme which he alleged was unconstitutional.

The Supreme Court considered that the fact that Mr Zalewski had not raised constitutional issues prior to the initial hearing did not go to his legal standing to pursue his constitutional challenge but might be relevant in relation to an estoppel defence. The Court also did not agree that the reference to language regarding a pre-emptive strike from a prior case was related to the question of legal standing.

The Supreme Court remitted the constitutional challenge back to the High Court and the High Court hearing and decision is awaited.

What does this mean for the resolution of workplace disputes in the future?

We await with interest the decision of the High Court on this case. Any significant change to the 2015 Act or the forum in which workplace disputes are dealt with could have implications for all parties in relation to the strategy used and the costs incurred when handling workplace disputes.

Simply requiring witnesses to swear an oath before providing verbal evidence may not dramatically increase costs but any move towards the provision of written witness statements (as occurs in the English system) could add substantially to hearing costs and inevitably adds time to the litigation process.

While employees may welcome the threat of a public claim as an additional negotiation tool employers are likely to be less keen to air all laundry in public. Litigation strategy would need to be revisited to take account of potential reputational harm where claims are heard in a public forum and potentially with media in attendance even where the employer is satisfied that the allegations are unsubstantiated.

Also if all adjudication officers are required to have legal qualifications this could lead to a dramatic reduction in the number of adjudication officers at least in the short- to medium-term which would have a knock on effect on the speed with which cases are disposed. It may also lead to more legalistic approach to the process.

Do the constitution and justice require a change to the current workplace dispute resolution processes under the 2015 Act? Are more formal processes such as those in the courts or akin to those in England required? In England only the average and not 92pc of claims are heard within seven months. Happily this is not a question we have to answer. However we would suggest it has long been the prevailing view that when handling employment disputes a simplified and streamlined process is in the interests of all parties.

 

This article contains a general summary of developments and is not a complete or definitive statement of the law. Specific legal advice should be obtained where appropriate.

Cian Beecher Helen Webb and Niamh Fennelly are solicitors and part of the employment law group at Arthur Cox

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