Regina Doherty (Meath East, Fine Gael) | Oireachtas source

I move amendment No. 49:

In page 15, between lines 24 and 25, to insert the following:

“PART 4

AMENDMENT OF NATIONAL MINIMUM WAGE ACT 2000

Amendment of National Minimum Wage Act 2000

17. The National Minimum Wage Act 2000 is amended—

(a) by the substitution of the following section for section 14:

“14. Subject to sections 15, 17, 18 and 41, an employee shall be remunerated by his or her employer in respect of the employee’s working hours in any pay reference period, at an hourly rate of pay that on average is not less than the national minimum hourly rate of pay.”,

(b) by the substitution of the following section for section 15:

“Prescription of percentages of hourly rates of pay

15. (1) The Minister shall prescribe a percentage of the national minimum hourly rate of pay in relation to employees—

(a) who have not attained the age of 18 years,

(b) who are 18 years of age, and

(c) who are 19 years of age.

(2) Subject to sections 17, 18 and 41, an employee to whom subsection (1) relates shall be remunerated by his or her employer in respect of the employee’s working hours in any pay reference period at an hourly rate of pay that on average is not less than the percentage of the national minimum hourly rate of pay prescribed under that subsection in relation to that employee.

(3) In prescribing percentages under subsection (1), the Minister shall have regard to the condition of the labour market, the costs of employment, levels of youth employment and levels of youth unemployment.

(4) In prescribing percentages under subsection (1), the Minister shall not prescribe a percentage that is—

(a) in the case of employees who have not attained the age of 18 years, less than 70 per cent,

(b) in the case of employees who are 18 years of age, less than 80 per cent, and

(c) in the case of employees who are 19 years of age, less than 90 per cent,

of the national minimum hourly rate of pay.”.”.

I am proposing this amendment on foot of the recommendations of the Low Pay Commission in respect of the current sub minimarates of the national minimum wage. This aspect relates to changes in the sub minimarates for younger workers. The current system allows for reduced rates for those under 18 and for those over 18 in the first and second years of their employment.

I have already mentioned the formal consultation process and research commissioned by the Low Pay Commission and its examination of the sub minimarates for younger workers. The commission's recommendations with regard to the age-based and first employment rates were that they should be retained but on a simplified basis to improve compliance and make the provisions easier to operate.

The report of the Low Pay Commission sets out the evidence base and rationale for its recommendations to retain the age-based rates for younger workers. The report acknowledges the statutory restrictions that apply in respect of working hours and conditions for employees under 18 years of age and also the need to ensure access to the labour market for our younger people. The simplification of the rates to a purely age-based system will assist employers in that it will be administratively simpler to operate. It will also benefit slightly older employees, for example, those moving into a first job while in or on leaving university between 20 and 30 years of age, in that they will no longer be subject to sub minimarates.

In making these amendments, I am also making provision to allow that the percentages at which the sub minimarates are set may be adjusted in the future by statutory instrument. This will allow for the percentages to be adjusted depending on labour market conditions at the time. I believe this provision will permit possible further upward adjustment of the rates in a controlled manner, while the possibility of any negative impacts on employment for younger people can be monitored and assessed. I mentioned that the Low Pay Commission's recommendations in this matter for the first time were supported by all nine members of the commission, including employer, employee and independent members.