Damien English (Meath West, Fine Gael) | Oireachtas source

I thank the committee for having us today. At the outset, I want to apologise. As we informed the Chair and the clerk to the committee, due to the Dáil scheduling I have to be in the Dáil Chamber at 10 a.m. for a debate and, therefore, I am afraid that I can only stay until about 9.55 a.m. I am sorry that I will miss the discussion on the general scheme of the redundancy payments (amendment) Bill 2021 because it is an important Bill. Our officials will take members through all of that today. I apologise that I cannot be there. It was the intention to be there for that discussion with committee members. I am happy to engage with them after the committee meeting on any individual piece if need be. The officials will present it and go through it in great detail. It is a worthy item of legislation.

On the sectoral employment order (electrical contracting sector) 2021, I am pleased to present a draft sectoral employment order for the electrical contracting sector. The draft order before the committee contains proposals from the Labour Court to introduce new minimum sectoral rates of pay, pension and sick pay entitlements, a dispute resolution process etc. for electricians and apprentices in the electrical contracting sector. This order, if approved, is to be treated as the first SEO for this economic sector. Before I introduce a specific draft order, I normally say something about the statutory process. It is important that I talk the members through that briefly. I am conscious that some members had a recent discussion with my colleague the Minister of State, Deputy Troy, a number of weeks ago, but it is important that I go through the process so that everyone knows what role we have in this.

A sectoral employment order is a statutory minimum wage-setting mechanism in a given economic sector. Essentially, a SEO is a unique collective bargaining mechanism which, once the statutory thresholds have been met, gives the Labour Court as a neutral decision maker the power to examine an application for a SEO in a given economic sector. As part of this examination, the Labour Court must explore all the policy considerations set out in the Industrial Relations (Amendment) Act 2015 by affording all interested parties an opportunity to engage with the proposals and have an opportunity to be heard. Fundamentally, it is the Labour Court that determines whether a recommendation ought to be made and what the terms of said recommendation ought to be.

Once the Labour Court has completed this statutory process as set out in the Act of 2015, it has the power to make a recommendation for a SEO to me or the Minister of the day. This recommendation must be accompanied by a report that sets out the process and matters which the Labour Court considered in reaching its recommendation. The purpose of this report is to assist the Minister, and the committee, in satisfying me, him or her that the Labour Court has complied with its statutory functions as required by the Act.

The role of the Minister - in this case it is me today - in this process is extremely limited in terms of my decision to recommend that all the procedures are followed to the letter of the law. Pursuant to the Act of 2015, the Minister has the power to either accept or reject the recommendation as presented. In this regard, the Minister is compelled to accept the recommendation if he or she agrees, based on the statutory report which the Labour Court has prepared, that the court has complied with the statutory process. If the Minister is not satisfied that the Labour Court has complied with its duties as set out in the Act, he or she must return the proposal to the court setting out his or her reasons for not accepting the recommendation. The Minister does not have any power to engage with the substantive recommendation itself. It is only about the process and that it aligns with the legislation.

The Act of 2015 also sets out that the Houses of the Oireachtas may only accept or reject the draft order as it is.

The Act does not permit any alterations or amendments from the committee to the draft order. If the Houses do accept the recommendation, I will sign a statutory instrument giving effect to this decision.Should the Houses reject or fail to approve the draft order, the proposal for the SEO will fall.

Again, the draft order before originated on foot of a request by Connect Trade Union that applied to the Labour Court pursuant to section 14 of the Industrial Relations (Amendment) Act 2015.The request was for the Labour Court to examine the terms and conditions relating to the remuneration, and any sick pay scheme or pension scheme, for electricians and apprentices in the electrical contracting sector. This request was supported by a statutory declaration alongside a report by the Nevin Economic Research Institute. The report set out the union's position of what the scope or definition of the economic sector is, and that it was substantially representative in terms of its membership in the economic sector.

Having examined the submissions and the accompanying supporting materials, the Labour Court reports that it was satisfied that Connect Trade Union was substantially representative of the workers of the particular class, type or group in the economic sector. Connect had argued that it represents 10,349 workers of the class, type or group. It also submitted that the number of workers normally employed in the sector to which the request relates consists of approximately 16,650 workers.

Having satisfied itself that it had the jurisdiction to proceed with the examination, the Labour Court, as it is required to do under the law, published its intention to undertake an examination of the request and invited submissions on 1 June 2021. Written submissions were received from seven interested parties that represent employees, employers and pension providers. These submissions are available on the Labour Court's website. I have also shared the Labour Court's report to me with the members of this committee in order that they will have had an opportunity to familiarise themselves with the detail of the examination. Members will have seen that the 54-page report is very detailed and went into every issue that was discussed openly and clearly.

A public hearing was held on 23 and 24 September 2021. All interested parties were given an opportunity to be heard and to engage with the various policy considerations, including the Labour Court's earlier decision to proceed with the examination itself. Members will have seen from the report that the issue of whether the application had been made by a body that was "substantively representative" was debated in detail. The Labour Court also considered the argument on whether the electricians and apprentices working for small contractors could be excluded from the scope of the SEO. The Labour Court has concluded, interpreting the construction of the 2015 Act itself, that the SEO terms are binding in nature on allemployers in the economic sector concerned, including subcontractors and posted workers.

The other matters that the Labour Court was compelled to consider were whether this SEO will support the maintenance of harmonious relations in the economic sector; the potential impact of the making of an order on levels of employment and unemployment in the economic sector; the potential impact on competitiveness in the economic sector concerned; and whether the SEO would be binding on allworkers and employers in the economic sector concerned.

I can confirm to the committee that I have considered this draft recommendation in line with the terms of the 2015 Act, relying on the statutory report outlining the Labour Court's deliberative process. I am satisfied that the Labour Court has complied with its statutory role and that it was appropriate for me to refer to matter to this committee. I wrote to the Labour Court on 17 November 2021 to confirm that I accepted this recommendation. Furthermore, as required by the Act, I laid a draft order before the Houses on 19 November 2021.

I hope that the committee will accept this draft order. I believe this SEO plays a significant role in supporting this very important professional sector. The terms of the SEO refer merely to the minimum rates of pay and terms and conditions. At times when the sector is buoyant, as it now is, it is to be expected that remuneration for most electricians will exceed these minimum rates. The importance of an SEO is to ensure that in times of difficulty or downturns, electricians and apprentices in this sector are properly protected. By providing statutory certainly about minimum rates of pay the economic sector should maintain its attractiveness as a profession.

It has been a long-standing practice of the trade unions and the employers in this economic sector to form agreements that govern the terms and conditions of employment. These arrangements have been in place for many decades and have provided the industry with cost certainty and stability. Again, it is important to emphasise that this order, if approved by the committee, will apply to all employees within its scope, regardless of whether they or their employers were involved in this SEO process. In saying that, I am satisfied that any persons who sought to make submissions to the Labour Court were given an opportunity to be heard and their arguments have informed the Labour Court's recommendation on this matter. There was certainly plenty of public advertisement of the public hearings and the request for submissions.

Should this order be approved by the committee, I will sign an order giving it legal effect. Its terms will be binding across the entire economic sector. The new order will become effective on 1 February 2022 and will remain in place for two years with additional increases provided for in 2023. In conclusion, I thank the Chair and members for their time.