A COUNCIL decision to pass its bin collection service to a private company was not classed as "outsourcing" because the service was no longer viable, the Labour Court has ruled.
It decided that a decision by Dublin City Council to stop collecting its 140,000 customers' bins next month did not breach the Croke Park deal.
It found that the country's largest local authority's plans to pass its bin collection service to Greyhound Recycling and Recovery "does not amount to outsourcing".
The court accepted that the council had to pull out of the market because it could not compete in the price war between private-sector contractors.
The decision clears the way for the council to exit the domestic and commercial refuse-collection markets on Friday, January 13.
It also sets a precedent for other state bodies that want to privatise services and can prove that they themselves are too costly.
Dublin City Council said it was "very happy with the Labour Court's recommendation".
"IMPACT has now rejoined its SIPTU colleagues in engagement with management on the implications of the new arrangements for its members," said a spokesman.
Dublin City Council had argued it would have to subsidise the rubbish service if it continued in-house.
It warned that this could lead to cuts in other vital services.
The continuation of the waste service would have "inevitable adverse consequences for other services that it needs to, and indeed is mandated to, provide to the city", it said.
The council's 160 bin-collection staff will not lose their jobs but will be redeployed to other sections of the local authority.
A row erupted after unions accused the council of breaching commitments in the Croke Park deal to avoid outsourcing.
They claimed the decision would remove the prospect of good-quality employment for many people.
However, although the employees will be redeployed, IMPACT said it believed the new posts would "ultimately be lost".
The Croke Park agreement commits to the use of direct labour "to the greatest extent possible" but only "where consistent with the efficient and effective delivery of services".
The deal does not rule out outsourcing completely, once a proper evaluation of the full costs of running the service is carried out and staff are properly consulted.
In its recommendation, the Labour Court noted that the market for collection of domestic refuse had been effectively deregulated in Dublin.
It added that the council was no longer the dominant provider in what was now "a very competitive multi-player industry".
"The court takes the view that the decision to withdraw from the collection of domestic refuse and to leave the market to the private sector does not amount to outsourcing," it said.
"Rather, it reflects the reality that the customer base has been moving away from Dublin City Council.
"Price competition from new entrants to the market undermines the capacity of the council to maintain the service at a price that makes it economically viable."
It said the council's decision to reorganise services was "entirely rational".