Billy Kelleher (Cork North Central, Fianna Fail)

I am pleased to bring the Employment Agency Regulation Bill 2009 before this House for debate. I propose to make some general observations on the rationale and principles informing the content of the Bill because I appreciate that Members will have a fuller opportunity to explore the provisions in more detail on Committee Stage.

The current licensing system governing the operation of the employment agency sector in Ireland is underpinned by the Employment Agency Act 1971, which has been in place for more than 35 years. The 1971 legislation was enacted at a time when the intention was to protect vulnerable Irish emigrants from exploitation by employment agencies abroad. The employment market in Ireland has been transformed in the intervening period and employment agencies have responded by developing their services to meet the needs of potential end user enterprises and agency workers.

In addition, the accession of new central and eastern European states in May 2004 has resulted in free movement of persons between these countries and Ireland and the deployment of temporary workers from employment agencies in EEA states in end user undertakings in Ireland. Key concerns in the review and partnership discussions pertained to the potential for exploitation of vulnerable agency workers from overseas and non-compliance with Irish employment rights legislation by employment agencies as employers, particularly in respect of personnel assigned as agency workers across national boundaries to end user undertakings in one state where the formal employer is based in another state.

The Bill before the House responds to commitments agreed under the social partnership agreements in Towards 2016 and the review and transition agreement 2008-09. At the core of the agreement by the social partners is a commitment to reinforce the existing system of regulation by requiring all employment agencies established or operating in Ireland to hold a licence. The focus of the Bill is, therefore, on the licensing and regulation of employment agencies which supply agency workers to an end user, or hirer, undertaking in Ireland. It provides for a mandatory licensing framework which will also embraces employment agencies delivering a service from outside the State even where they do not have a physical presence here. As such, the Bill is aimed at updating and strengthening the current licensing system. The provisions in the Bill are focused on ensuring that potential vulnerable agency workers posted temporarily from such agencies are protected against abuse and exploitation.

The Bill provides that employment agencies established in the State may operate only under a licence granted by the Minister for Enterprise, Trade and Employment. It also provides that employment agencies established in another EEA state must apply for an employment agency licence unless the Minister is satisfied that agencies in that state are permitted to operate in accordance with a licence or are otherwise appropriately regulated, authorised or supervised in that state. Such agencies will be recognised agencies within the terms of the Bill. Employment agencies from outside the EEA seeking to supply agency workers to Ireland will be subject to the State's employment permit system.

Deputies will appreciate that it has not proved possible to adopt a one size fits all approach to licensing employment agencies operating in Ireland. We are constrained in our approach by concerns about the legality of licensing agencies in other EU member states in which employment agencies are already subject to regulation and control because we could be deemed to be infringing EU treaty provisions as interpreted by European Court of Justice rulings. Licensing could be construed, for example, as a non-tariff barrier to provision of cross-border services.

The Bill provides that it will be an offence for an employment agency to carry on its business in the State if it is not licensed or a recognised employment agency. To further underpin the regulatory framework, an end user undertaking in Ireland is prohibited from recruiting an agency worker to work in the State from an employment agency which is required to be licensed but does not hold a licence. An end user undertaking which fails to comply with this provision will be guilty of an offence.

The Bill clearly embraces employment agencies which provide placement and worker hire services. The latter agencies are often referred to as a temporary employment agencies in respect of which a triangular relationship is established between the agency, as employer, the agency worker and an end user undertaking to which the agency worker is assigned and under the direction and control of which he or she works. The Bill does not, nor is it intended to, interfere with the fundamental characteristics of this established triangular relationship.

The Bill provides for the designation by the Minister, after consultation with an advisory committee, of a code of practice. The code will set out the practices and standards of behaviour including practical guidance to employment agencies for the purposes of complying with the provisions of the Act and any regulations made under it. The code will be an instrument to guide best practice in the employment agency sector. A code of practice by its very nature is meant to provide guidance on compliance and as such will not be a statutory obligation. Clearly, however, employment agencies which fully embrace the terms of the code of practice could use it as an important marketing tool in terms of the quality of services they offer.

Apart from submitting the code of practice for the sector for the approval of the Minister for Enterprise, Trade and Employment, the proposed advisory committee will also advise on the ongoing operation of the new legislation and the employment agency sector generally. The advisory committee will include representatives of the social partners and other interested parties, including the agency sector, departmental nominees and ministerial appointments. The committee will comprise no more than ten persons with a chairperson. A core element of its work, immediately after the enactment of the legislation and following the issue of a commencement order, will be to draw up a proposed code of practice.

In addition to being given the capacity to revoke a licence, the Minister is also being provided with powers to prohibit recognised employment agencies from operating in Ireland where an agency has contravened the provisions of the Bill. The capacity to suspend for stated reasons employment agencies from another EEA state for a period of three years is a potent measure to help secure compliance with the core objectives and intent of the Bill.

We have also been considering ways in which a provision might be included in the current Bill to further strengthen the enforcement of employment law in respect of agencies established outside the jurisdiction. Given that it is regarded as contrary to EU law to require an agency to appoint a specified representative in the State for the purpose of ensuring compliance with employment legislation, we have considered whether an agency might be prosecuted for an alleged criminal breach of the law even where the defendant fails to appear for the trial. The advantage of such an approach is that a prosecutor could realistically proceed against employment agencies which offend against employment law and ultimately prevent them from operating in the State on foot of a conviction. This could prove to be a valuable tool in enforcing employment rights compliance. A provision for prosecution in absentia for offences under employment rights legislation has been included in the Bill.

As regards the enforcement of decisions of Irish courts and tribunals, including rights commissioners, the Labour Court and the Employment Appeals Tribunal, in EEA states, it will be possible to enforce Irish judgments under Brussels I regulations on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters. These regulations will enable persons who are employed by an employment agency established in another EEA state and who perform services in the State on behalf of a hirer undertaking to obtain remedies against the agency concerned in respect of breaches by it of Irish employment legislation. It will also enable them to enforce a judgment or decision of an Irish court or tribunal in any member state other than Denmark. Under the terms of regulation 44/2001, a judgment of a court or tribunal in Ireland is recognisable and enforceable in any other member state to which the regulation applies. The Jurisdiction of Courts and Enforcement of Judgments Act 1998 will apply in respect of Denmark and other EEA states.

The Bill also includes measures to counter penalisation of agency workers and to protect such workers in the context of disclosure. Agency workers are thus being provided with standard whistle blower protections.

The Bill, which provides an enhanced and strengthened regulatory framework for employment agencies established and operating in the State, means that core commitments in the social partnership agreements are being met to the maximum extent consistent with our treaty obligations. The framework allows for a balanced approach which provides for the protection of potentially vulnerable agency workers while at the same time allowing employers flexibility to fill job vacancies.

The Government also intends to hold open the possibility of introducing an appropriate mechanism to prohibit, save in relation to essential services, the use of agency workers supplied by an end user undertaking for the direct replacement of employees in cases of an official strike or lock out. The prospect of such a provision is based on the assumption that sufficient progress can be made by employers' representatives and trade unions in concluding a framework agreement under Article 5.4 of the EU directive on temporary agency work. That directive provides for equal treatment of temporary agency workers and workers directly recruited by an end user undertaking to the same job. The directive provides for equal treatment from the first day of employment for agency workers and a derogation by agreement between the national social partners on an agreed time limit or qualifying period before which the agency worker would qualify for equal treatment. My Department is facilitating meetings between the social partners to help them develop a framework agreement within the parameters of the EU directive. The successful conclusion of an agreement will enable the Government to consider transposing the terms of the directive, including the framework agreement, in advance of the directive's deadline of end 2011.

I will now outline the provisions of the Bill. Section 7 is a standard provision dealing with the Short Title and commencement of the Bill. Section 2 sets out the main definitions associated with the Bill. Section 3 defines the two types of employment agencies to which the Bill applies, that is, a "placement agency" and a "worker hire agency", often referred to as a temporary employment agency. Section 4 empowers the Minister to make regulations prescribing, inter alia, the form of an application for an employment agency licence, the form of an employment agency licence and the fee, or fees, in respect of an employment agency licence application.

Section 5 stipulates that any orders and regulations made by the Minister under the Bill, with the exception of an order made under section 1(2), must be laid before the Houses of the Oireachtas.

Section 6 is a standard provision stating that the expenses incurred by the Minister, in connection with the administration of the Bill, shall be paid out of moneys provided by the Oireachtas. Section 7 sets out the procedures that apply to the service of documents under the Bill.

Section 8 provides that a person guilty of an offence under the Bill shall be liable, on summary conviction, to a fine not exceeding €5,000 or to imprisonment for a term not exceeding 12 months, or both, and on conviction on indictment to a fine not exceeding €250,000 or to imprisonment for a term not exceeding five years, or both.

Section 9 provides for the repeal of the Employment Agency Act 1971 and for the revocation of all regulations made under the Act. Section 10 provides that to be eligible to apply for a licence a person must be established in the State or in another EEA state. Agencies from outside the EEA wishing to offer a service in the State must establish in Ireland or in another EEA state. The supply of personnel from outside the EEA will be subject to the employment permit requirements. The section also provides that the Minister can refuse a licence in certain circumstances.

Section 11 sets out the circumstances in which the Minister may revoke an employment agency licence. Section 12 provides for the Minister to designate an EEA state as one which satisfies requirements for the licensing or otherwise regulation of, employment agencies in that EEA state.

Section 13 provides for the prohibition by the Minister of a recognised employment agency from carrying on the business of an employment agency in the State or providing an employment agency service to a person in the State, in certain circumstances, for a period of up to three years. Section 14 provides for the publication by the Minister on the Internet of a list of licensed employment agencies and recognised employment agencies.

Section 15 provides for an appeal to the Circuit Court by applicants for a licence, or a licensed employment agency or a recognised employment agency in circumstances where the Minister has refused to grant a licence under section 10, revoked a licence under section 11 or prohibited a recognised employment agency from carrying on the business of an employment agency in the State or providing an employment agency service in the State, under section 13.

Section 16 provides that the Minister may direct an employment agency in writing to provide to him or her, by a given date, information and documentation on the remuneration and hours of work of any of its employees in respect of any period of work of those employees with a hirer undertaking.

In addition, the section provides that where a licensed or recognised employment agency contravenes a direction under this section, the Minister may serve a notice on the licensed employment agency informing it that its licence shall cease to have effect, which shall cease to have effect on service of the notice, and serve a notice on the recognised employment agency informing it that it is prohibited from carrying on business in the State or providing an employment agency service to a person in the State. Finally, the section provides that a person shall be guilty of an offence if he or she contravenes a direction under this section.

Section 17 provides that the Minister may make regulations requiring licensed and recognised employment agencies to prepare such records as may be specified in the regulations and to keep those records for such period of time specified in the regulations. The section also provides that a person who contravenes the above requirements shall be guilty of an offence.

Section 18 provides that the Minister shall publish, on the Internet, a list of employment agencies which have had their licences revoked under section 11 or which do not have effect in accordance with section 16 and of recognised employment agencies in respect of whom a prohibition notice under sections 13 or 16 is in force. Section 19 provides that a person, other than a licensed employment agency or a recognised employment agency shall be guilty of an offence if he or she carries on the business of an employment agency in the State or provides an employment agency service to a person in the State or advertises or causes to be advertised the provision by him or her of an employment agency service. This section also provides that a person, other than a licensed employment agency or recognised employment agency who holds himself or herself out as being a licensed employment agency or recognised employment agency, whether by advertisement or not, shall be guilty of an offence.

Section 20 provides that it is an offence for a person to enter into an agreement with an employment agency for the provision of an employment agency service by that employment agency if it is not licensed or is not a recognised employment agency. Similarly, it is an offence for a person if an unlicensed employment agency or an employment agency, which is not a recognised employment agency, provides an employment agency service to that person. I hope what I say is clear. It might sound like repetition but it is important that the provisions are clearly outlined.

The section also provides that in proceedings for an offence under this section that it shall be a defence for the accused to show that he or she did not know and could not, upon reasonable inquiry, have discovered that he or she was not dealing with a licensed employment agency or a recognised employment agency.

Section 21 provides that a placement agency shall be guilty of an offence if it charges a job seeker a fee for providing its services to the job seeker, including training. The section also provides that it shall be an offence for a person to employ a job seeker who has been charged a fee by a placement agency. In addition, it is provided for that in proceedings for an offence under this section, it shall be a defence for a person to show that he or she did not know and had no reasonable grounds for believing that the placement agency had charged the job seeker employed by that person a fee for providing the job seeker with its services, including training.

Section 22 provides that a licensed employment agency must produce its licence for inspection by an authorised officer on request, must display a copy of the licence prominently in its premises and that a person who contravenes this section shall be guilty of an offence. Section 23 provides that a person who forges an employment agency licence, displays a forged licence knowing it to be forged, alters a licence with intent to defraud or deceive, displays an altered licence knowing it to be altered, produces a revoked licence to another person with intent to defraud or deceive or who has in his or her possession a forged or altered licence, without lawful authority, shall be guilty of an offence.

Section 24 provides for the appointment of authorised officers by the Minister for the purposes of the Bill. Section 25 sets out the powers of authorised officers, including the power to require certain records from persons who control workplaces. Section 26 provides for the prosecution in absentia under section 50(1) of the Criminal Justice Act 1994 of employment agencies from outside the State who have committed an offence in regard to one of their employees in the State under a specified enactment set out in Schedule 1 to the Bill, that is, industrial relations or employment rights legislation.

Section 27 provides for the making by the Minister by order under the Bill of a code of practice relating to the conduct of employment agencies, after consultation with the advisory committee, to be set up under section 33 of the Bill. Section 28 provides for administrative co-operation with foreign statutory bodies on issues which arise under the Bill. Section 29 provides for the protection from civil liability of persons who report breaches of the Bill to the Minister or a member of the Garda Síochána.

Section 30 provides that an employer shall not penalise or threaten penalisation against an employee for making a complaint to a member of the Garda Síochána about a breach of a provision of the Bill or giving evidence in any proceedings under the Bill. The section also sets out what constitutes penalisation.

Section 31 provides that if a person states to the Minister, or to a member of the Garda Síochána, that an offence under the Bill has been, or is being, committed or that a provision of the Bill is not being complied with, knowing the statement to be false, he or she shall be guilty of an offence.

Section 32 provides that references to the Employment Agency Act 1971 in any enactment shall be construed as references to this Bill. Section 33 provides for the establishment of an advisory committee, by the Minister, to advise and assist him or her on the performance of his or her functions under the Bill, and for the appointment of members of the committee, by the Minister. Section 34 provides, inter alia, that on assuming membership of either House of the Oireachtas, European Parliament or local authority, such person shall cease to be a member of the advisory committee.

Schedule 1 contains a list of specified enactments, that is, the body of industrial relations and employment rights legislation that applies, inter alia, to employment agency employees. Schedule 2 sets out the redress mechanisms available to, inter alia, employment agency employees in the event that their employers are in breach of section 30(1) of the Bill.

I commend the Bill to the House. It resulted from discussions with the social partners. It has been a long time in gestation. Clarity was required in the context of our obligations under European Union treaties. Much discussion took place at European Union level to achieve that clarity. The Bill is a commitment to make sure exploitation is weeded out. The issue was raised quite forcefully in discussions with the social partners, including in discussions I had with them when I had responsibility for labour affairs. The legislation will deal with agencies or undertakings in Ireland that intend to use workers in an exploitative way. I commend it. There is broad support for ensuring agencies are well regulated but, equally important, for ensuring the triangular relationship between agencies, employees and the employers or undertakings functions and allows flexibility in the workforce.

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