Ms Patricia Callan:

I thank the Chairman, Deputies and Senators for the invitation to share the concerns of our members on the Banded Hours Contract Bill 2016. As members are all aware, small firms are the backbone of the Irish economy and of the 238,000 businesses, more that 98% are in the category of small businesses. A small business is defined as a company that employer fewer than 50 people. In some 21 counties we are the majority employer. Last year approximately 20,000 new people decided to that risk and set up a business venture. It is important to point out that studies consistently show that only one in two of those firms will make it beyond five years. Among all the other challenges they are facing in terms of markets, customers and finance and all of the usual things, the regulatory burden is becoming more of an issue, and in terms of labour legislation in particular it is becoming a barrier to employment and increasing employment. We need to be cognisant of that in any review of potential new legislation.

We particularly welcome that in the “Action Plan for Jobs” this year, the Minister saw fit to call out the fact that we need to formalise our concept of “think small first” and that there should be a test implemented. I encourage the Joint Committee on Jobs, Enterprise and Innovation to take the lead on it and in the context of this specific Bill to apply the principles that were defined by the EU around understanding the real consequences on business prior to any legislation.. We would advocate that this should be done at principle. At a basic level we need to look at the problem we are trying to address, we need to see whether they are other options we could use prior to legislation and if there is no alternative other than new legislation we need to cost it and on balance decide whether it is worthwhile going forward or not.

In everything to do with the Bill and going back to the University of Limerick study, our biggest consideration is the fact that there is no evidence. Nobody should be making decisions on the basis of anecdotes. I have my share of anecdotes and I know from the transcripts of last week's meeting that the employees side also had a series of anecdotes. We need to get to a better bar of evidence based policy making across the board and we should start here. In parallel, as on many other topics we have a Private Members' Bill moving at the same time as the Government Bill. Even from our perspective in terms of trying to track that Bill, never mind the Government Bill, the time and efficiency of our legislative process is questionable.

On the basis that the Bill under discussion is being given due scrutiny, I will go through the specific matter have been raised and share our insights on them. I mentioned that submitted a detailed response to the Department in January 2016 on the prevalence of zero-hour contracts and low hour contracts among Irish employers and their impact on employees. I have also sent that submission to the committee secretariat. Our response gives members a flavour of the practicalities from a variety of sectors and regions about how they saw these types of measures playing out. If the members scan through that response they will notice the reality in most employment is that employers ask employees to tell them what hours they are available and they then create the entire roster and schedule around that. It is not about imposing on employees, it is the other way around.

In essence, the power balance, from the perspective of most of those companies, is with the employee already and we are simply trying to fit their lifestyle and other needs and desires into what we are trying to do.

The committee was anxious to ask about how we solve this problem and one of the issues raised was the difficulties for workers with variable hours in getting mortgages. I would call on the committee to start questioning the logic of that. We campaigned long and hard to have business banking changed from asset-backed lending to cashflow lending because the former is not an acceptable way of doing business. Equally, why are banks still hung up on permanent full-time hours when a P60 will tell a completely different story? One should start to think about matters in terms of how else we might tackle the issues of concern at the root cause of this because we must have innovation in everything that we do and the world is moving on. I have just come from a briefing in Revenue on the PAYE modernisation system. It is changing its entire system to reflect the new way of working, new hours, different requirements and integration of welfare. We must also replicate those concepts here in our discussion of labour law.

On the question on whether zero-hour contracts should be banned, the SFA's members and anyone I have advised have looked at this and decided that their use is unaffordable.. I have no direct knowledge of any of the SFA's members using zero-hour contracts. When these were being introduced - this came from an EU directive - the labour movement, in essence, the trade union movement, argued for zero-hour contract provisions in terms of recompense to be introduced to protect workers. Where there is that give and take, where one is asking workers to be available to do work and, therefore, they cannot take up other opportunities, there should be recompense. Equally, if it is casual on both sides, then there is no need because those concerned can do other things and be productive in their time should that employer not have opportunities. They are not causing any harm and they work well as they are.

In terms of the third question raised, there is no flexibility in the Bill. It is a poorly drafted Bill and is open to all kinds of interpretation. It is very important on Committee Stage to get it right.

In terms of the position of the notice, I have run this by a number of members. The idea that one would put up on a notice board personal details of every employee and his or her hours of work raises significant data protection issues of concern for workers as well, but the idea that one would have to translate it into English, Irish and any other language is nonsense. On the translation costs alone, one cannot merely Google it. If it is in law and one will be held liable, one must ensure it is correct and one cannot merely put it into a translator mechanism. All such practical issues involve a greater administrative burden than any other legislation currently on the Statute Book and we must guard against that.

The committee had a discussion here as to whether to exempt small business. I represent small firms. We never argue for exemptions because in the real world doing so overly complicates everything and also stops firms growing. If one states this will only apply to companies with more than five or ten employees, one will soon see a common thread where no one will go over that if he or she does not have to unless he or she is scaling up. We do not want to impose such barriers and complexities on the system. We need legislation to work for every business all of the time but we need to think small first in our approach to how we legislate and regulate. I would also point out that our surveys show the average number of employees one has before a HR professional is employed to deal with all of this is 52. Some 98% of businesses do not have a HR professional and coping with 40 pieces of legislation is a massive burden. That is the same whether one has one employee or 500. One has to come up to speed, understand and know of these rules. That is a huge issue.

On the fourth question, in terms of the need for flexibility, it is definitely our members' understanding that if-and-when contracts work for many. The committee will see in the submissions testimony from members that they concern here those who one might expect, such as students and females with balancing requirements, but also those pursuing other interests, such as artists and those who want to do their ideal job but who cannot afford financially to stick with it and need other work at the same time. There are many reasons we would want to use these. We definitely need to maintain such flexibility. There is a huge assumption that low hours and low pay are the same; they are not. Indeed, most of the ultra-flexible contracts that we see are at the high end, involving those who choose, because they can, in the IT professions, in engineering, in medical, to come and work in different ways. That is certainly important.

On the right for a worker to request increased hours and to permit refusal only on objectively justified grounds which grounds are restricted to experiencing severe financial difficulties, the idea in the Bill is that one must concede to give hours. As the Bill is worded, the only way out of giving hours is to go public stating that one is financially in dire straits. This will not happen. Despite the fact that many businesses during the recession could have claimed under the National Minimum Wage Act 2000 that they were experiencing severe financial difficulty, they never did. They never invoked that exemption. They simply made workers redundant or, if they could hang on to them, put them on short-time or lay-off provision. Having measures such as this in place will not work. In reality, one cannot get beyond the reputational damage.

The other point then, if such is the case, is that if the first employee who requests these additional hours gets them, does that mean everybody else has to lose out because there are only a certain number of hours, and one employee wins and everybody else loses? When one gets into the practicalities of this, merely dealing with it is complex.

On the final question on the Low Pay Commission, the commission has a big enough job to do as it is. It has a specific remit and it needs to be better at it. It needs to produce better evidence, going back to the fact it has not produced any new data since it was established. We need to focus on that area. The Workplace Relations Commission is already well established. We have members in and out of the WRC all the time. Clearly, persons can already bring cases on all of these issues under the Industrial Relations Acts, the Organisation of Working Time Act 1997 or the Terms of Employment (Information) Act 1994.