Austerity, Legislative Change and Legitimate Expectations

Back in my native Ireland, the public finances have been severely compressed since the onset of the Great Recession. Unsurprisingly, numerous legal issues have arisen. A recent interesting case is MacDonncha v. Minister for Education and Skills, [2013] IEHC 226.

The applicants here are the chief executive officers of two regional education authorities (Vocational Education Committees). Reform of these bodies has long been mooted and, pursuant to the Educational and Training Act 2013, the 33 existing authorities will be abolished and replaced by 16 new bodies. Naturally, the reduction in numbers has consequences for the applicants. In the run-up to the enactment of the new legislation, the minister issued an administrative circular explaining the proposed new structure.

The applicants complained that, in issuing the circular, the minister was attempting to create a parallel system divergent from that envisaged in primary legislation. Hogan J. rejected this argument:

25. [T]he courts have no role at all in the lead up to or in the planning of new legislation or in respect of its passage through the Oireachtas. In the present case this meant that, provided, of course, that the Government continued to operate the Vocational Education Acts pending their repeal by the Oireachtas, it was entirely free to plan for the new contingencies which would or might arise following the enactment of new legislation which repealed the old provisions and replaced them with a new structure. 

26. Is this what has happened? While the applicants had understandable concerns regarding the new structures and the manner in which the new vacancies might be filled, in the end no steps have actually been taken to compromise their position. Pending the enactment and commencement of the 2013 Act, the applicants remain undisturbed in their posts and the only steps which have been actually taken are in the nature of forward planning. Here again it may be recalled that paragraph 3 of the 2012 Circular - to which the Circular the applicants took exception - nonetheless critically stated that the categorisation of the ETBs and the new salary scales applicable to them “will apply from the commencement date of the legislation bringing into force the new Education and Training Boards.” (my emphasis)

The next question was whether the applicants had any legitimate expectations based on the Croke Park Agreement concluded between the government and public sector unions. In particular, the applicants claimed that they had been redeployed to new positions outside a 45km radius provided for in the Agreement. For a North American, who would think nothing of nipping out 45km to pick up a pint of milk, the distance seems small, but the average Irishman would stock up on canned goods for a journey of that duration. Accordingly, the applicants argued that they had a legitimate expectation that they would not be required to make such an arduous commute.

Hogan J. held that the Agreement was couched in such vague terms that it could not give rise to a legitimate expectation:

47. There is, in any event, a more fundamental objection to all of the applicants’ arguments based on legitimate expectations, whether by reference to Paragraph 1.6 or any of the other specific commitments contained in the CPA on which the applicants have relied.. Paragraph 1.6 is admittedly at the heart of the CPA with its commitment regarding compulsory redundancies. But that commitment is immediately qualified by the statement that this is subject “to compliance with the terms of this Agreement and, in particular, to the agreed flexibility being delivered.”

48. These very qualifications are inconsistent with the existence of any legitimate expectation, because as I pointed out in Holland, the language used “is too imprecise, conditional and aspirational to permit of this.” Critically, however, the rest of the commitments in the CPA are predicated on the delivery of such change and flexibility One might add that the nature of the commitment does not lend itself to judicial evaluation by reference to cognisable legal standards. As I pointed out in Holland, in the context of whether the CPA created legally enforceable rights (which passage I have already quoted above), how could a court determine, for examine, whether the public sector unions had been “sufficiently flexible” in respect of redeployment issues? Yet as the entire CPA is premised on this and must be read subject to these basic qualifications, it follows that none of the CPA’s provisions can give rise to a legitimate expectation.

Perhaps Hogan J. leans too close to non-justiciability in this passage and elsewhere in his judgment, but the underlying point is very clear: an agreement subject to heavy qualifications will not easily give rise to a legitimate expectation.

The applicants did win on two points. The scheme under the Agreement for arrangements to be approved by the Labour Court did not preclude judicial review on the basis of issue estoppel (surely the correct conclusion). And a travel allowance (for canned goods and other provisions...) unlawfully been terminated by the minister. As Hogan J. observed, the power to do so resided in the local education authorities, not the minister. A classic example of the executive acting ultra vires.