Richard Bruton (Dublin North Central, Fine Gael)

I move: "That the Bill be now read a Second Time."

I am pleased to present the Protection of Employees (Temporary Agency Work) Bill 2011 for the consideration of the House. The Bill marks an important milestone as it represents the last piece of the three part matrix of employment rights protection geared towards workers engaged in atypical work patterns. It has been preceded by the Protection of Employees (Part-Time Work) Act 2001 and the Protection of Employees (Fixed-Term Work) Act 2003 that deal, respectively, with part-time and fixed-term work. Members will have a full opportunity to explore the provisions of the Bill in greater detail on Committee Stage and I look forward to active engagement with them on the Bill.

The Bill has been designed to give effect to an EU directive on temporary agency work that was finally adopted in 2008 after a number of years of discussion. The directive has a transposition date of 5 December 2011 and as its implementation is mandated by our EU commitments, it is intended that the legislation will on enactment have retrospective effect to that date, with the exception of the offence creation provisions in sections 12 and 14 and Part 4 of the Bill. These latter provisions will, on the basis of legal advice, only come into effect on enactment of the legislation.

At its core, the directive aims to establish in all member states of the European Union a legal framework in which agency workers are afforded equal treatment in respect of their basic working and employment conditions as if they were directly recruited by a hirer to the same job. This key objective is reflected in the non-discrimination principle set out at Article 5.1 of the directive. Other entitlements concern the right of access by agency workers to the collective facilities and amenities at the hirer undertaking, to include canteen, crèche and transport facilities, in the same manner as these may be available to direct employees of the undertaking. Additionally, agency workers are also to be provided access to vacancy notifications to avail of the same opportunities to gain access to permanent employment positions in hirer undertakings. Agency workers must also be included in the headcount towards employee representation in either the employment agency, as in the case of the Bill or with the hirer undertaking.

In short, the directive established a set of minimum rules to be applied by EU member states having regard to the national law, custom and practices in force in each jurisdiction. This is geared towards improving the operation of the temporary agency work sector by promoting job creation and making agency work more attractive and amenable to employer needs for flexibility in the labour market. The underlying rationale for the directive, as explained by the European Commission at the time the proposal was first tabled in 2002, was that by extending the equal treatment provision to agency workers at EU level and creating a common framework for agency work, this would promote agency work. In the context of its analysis at the time, the Commission pointed to the main difference in terms of intrinsic quality of agency working compared with the terms and conditions enjoyed by employees on open-ended contracts as being related to pay.

The directive provides for certain derogations that may be availed of by member states under Article 5. The first of these is under Article 5.2 and allows member states to exclude from its scope but limited only to the aspect of equal pay agency workers engaged on a permanent basis and paid between assignments. Section 6 of the Bill invokes this derogation and includes necessary protections against potential abuse of the provision in that it requires that such workers are paid at a level of not less than 50% between assignments based on the most recent assignment.

The derogation available under Article 5.3 of the directive entrusts the social partners with the ability to conclude collective agreements that deviate from the basic working and employment conditions. While the system of collective bargaining envisaged under the Article 5.3 derogation is more suited to the well established system of collective bargaining associated with mainland Europe, in the Irish context, it would cover registered employment agreements. This derogation recognises the national traditions, custom and practice in place in member states and allows a necessary level of flexibility in the workplace to operate to the mutual benefit of employees and agency workers alike. Use of this derogation is not without limit but must have overall regard to the need to ensure overall protection for agency workers. Collective agreements cannot, for instance, set levels of pay at a rate lower than equal treatment would demand without being balanced by countervailing measures favourable to temporary agency workers such as, for instance, in respect of the provision of better training opportunities between job assignments.

Section 7 of the Bill provides for this derogation and enables existing collective agreements to be upheld and facilitates the negotiation and conclusion of future such agreements. It would also facilitate the future negotiation and conclusion by the social partners of collective agreements at the level of the user undertaking or at enterprise level. The provisions for oversight and approval by the Labour Court of such collective agreements as set out in the section mirrors that already in place in the context of agreements reached under the terms of section 24 of the Organisation of Working Time Act 1997.

Recognising the voluntarist nature of industrial relations in the United Kingdom and Ireland, the derogation available under Article 5.4 of the directive was designed to meet the needs and flexibilities required in the labour market to accommodate the system in place in both countries. This derogation includes the possibility to have a qualifying period before the principle of equal treatment would apply to temporary agency workers. However, the derogation is subject to agreement being reached between the national social partners and, in the absence of such agreement, cannot be invoked by the Oireachtas. Members will be aware that the present and previous Governments engaged in discussions with the national social partners, namely, IBEC and ICTU, with a view to facilitating agreement between the parties on this important issue. This was against the background that agreement on a qualifying 12 week period already had been achieved in Great Britain and Northern Ireland that applies to temporary agency workers assigned to hirer undertakings in the North and elsewhere in the United Kingdom. Regrettably, agreement on this issue has not proved possible between the national social partners. In that case, it is not possible to avail of the derogation and the Bill provides for the application of equal treatment for temporary agency workers on a day one basis.

I advise Members that the qualifying period was considered important not in any sense to disadvantage temporary agency workers as they would, on expiry of the qualifying period, benefit from equal treatment. Rather, the measure raises issues of a competitiveness nature in that the absence of agreement on a qualifying period, unfortunately, puts Ireland in a less favourable position in terms of labour market flexibility than that of our closest neighbour, the United Kingdom. Employer representative groups and the recruitment sector were also anxious to have a sensible qualifying period in place in Ireland, given that in the absence of such, it gives rise to greater administrative overheads in providing day one equal treatment, even in respect of very short-term assignments. This will result in higher labour and administration costs for the sector. There is also concern that this is likely to have a chilling effect on employment in the agency sector in that undertakings are likely to opt to use existing staff in preference to taking on agency workers to meet spikes in demand or short-term absences of permanent staff. It would have been optimal, at the least, to have an all-Ireland approach on a qualifying period, given that certain larger recruitment agencies operate both in the State and Northern Ireland. In the context of the serious labour market challenges that beset the economy, each job, including those of a short-term or even seasonal nature, must be nurtured and every effort made to maintain and grow employment and reduce unemployment.

In deciding how to establish equal treatment and in line with section 6 of the Bill, read in tandem with the definition in section 2, the requirement is to treat the agency worker as if he or she had been recruited directly by the hirer to occupy the same job. This means that equal treatment can be established by giving those relevant terms and conditions, for example, pay and holidays, as if the agency worker had been directly recruited by the hirer to occupy the same job having regard to the particular role and the required skills or qualifications needed. The relevant terms and conditions are those which are included in enactments, collective agreements or other arrangements generally applicable to employees of the hirer. This would include, for instance, terms and conditions ordinarily found in contracts of employment of directly recruited employees of the hirer which are binding and generally in force in the hirer undertaking. Section 2 defines "pay" as basic pay, shift premium, piece rates, overtime premium, unsocial hours premium and Sunday premium. Pay does not extend to other aspects provided for in recognition of the longer term relationship between an employer and a permanent employee such as pension schemes, financial participation or sick pay schemes.

As to the profile of agency work, although established statistical sources in Ireland do not capture data for this type of atypical work, in general, estimates based on surveys conducted by private employment agencies suggest temporary agency workers represent approximately 2% of the active working population. Currently, this would amount to approximately 35,000 agency workers operating in both the private and the public sectors. The majority of agency workers are engaged in the private sector across a diversity of sectors ranging from security, manufacturing and services to information and communications technology, etc. In the public sector, in particular in the health sector, agency workers represent a significant and important part of the workforce and allow the service to use them in a flexible manner to respond as necessary to short and medium-term staff absences.

Agency workers already enjoy extensive rights and entitlements in the current suite of Irish employment rights legislation. Thus, for example, they are entitled, in the same way as full-time workers, to the annual leave entitlements under the provisions of the Organisation of Working Time Act 1997. Additionally, they have recourse to redress under unfair dismissals legislation and are also subject to rules that apply under health and safety legislation. They can vindicate their rights and pursue grievances under employment law by accessing the same avenues of civil redress - rights commissioners and under the National Employment Rights Authority - as are generally available to directly recruited workers.

Under the Bill, it is important to note that there will be no change to the employment status of agency workers, nor will their entitlements to avail of existing employment rights such as statutory leave and rest periods, a safe working environment and the right to claim redress for unfair dismissal be affected. As is the case, the triangular employment relationship between the agency worker, the employment agency and the end user undertaking will continue under the Bill such that the employment agency which pays the agency worker's wage is the employer. In the case of unfair dismissal, however, it will continue as in the past that where an agency worker is dismissed by a user undertaking, the agency worker may bring a claim under the Unfair Dismissals Acts against the user undertaking which, in that instance, is deemed to be the employer.

In general, the fair treatment the enactment of the Bill will bring about for agency workers will confer a greater level of employment protection. Understandably, employer representative groups, user undertakings and employment agencies are concerned about the additional costs the legislation will impose in bringing the entitlements for agency workers to an equal level with direct employees. This is challenging at a time when businesses are otherwise facing serious challenges in endeavouring to maintain and sustain a competitive cost base.

Agency work has a legitimate and valuable role to play in the economy and is the option of choice of some who benefit from the flexibility, personal freedom and income it provides. It also serves the business needs of employers in that this type of atypical working arrangement can be used to assist in managing the peaks and troughs encountered in the normal business cycle.

In the light of the divergent considerations of the various stakeholders and based on the outcome of the consultation process undertaken in informing the provisions of the Bill, the Bill represents a balanced approach to transposition of the directive. It aims to respect in full the objective of providing fair and equal treatment for agency workers, while at the same time striking a necessary balance with the need to ensure labour market flexibility and contribute to ensuring agency work can continue as an option of choice for agency workers and employers and user undertakings alike.

The Bill is divided into four Parts and has two Schedules. Part 1 contains standard preliminary provisions. The main part of the Bill contains the protections available to temporary agency workers under employment law which are set out in Part 2. Part 3 contains a number of amendments to earlier enactments and certain statutory instruments. Part 4 sets out the means of achieving redress in the event that a claim by an agency worker for breach of equal treatment in terms of basic working and employment conditions or other entitlements is made. As I mentioned, the intention is that on enactment the Bill will, with the exception of sections 12 and 14 and Part 4, have retrospective effect to 5 December 2011.

Section 1 contains the Short Title of the Bill and enables the Bill to come into effect from 5 December 2011. The retrospective provisions will not apply to the provisions of the Bill that create offences.

Section 2 contains definitions of a number of terms used throughout the Bill. Section 3 sets out the scope of the Bill and to whom it applies. Section 4 gives effect to the exemption from the scope, permitted byArticle 1.3,of agency workers on public or publicly funded programmes where these are designed to facilitate the integration or reintegration of certain categories who may encounter difficulties in entering or re-entering the labour market. Section 5 is a standard feature to enable the funding of administration costs by the Minister.

Section 6(1) gives effect to the basic principle laid down in Article 5.1 ofthe directive in which a temporary agency worker assigned to a hirer is entitled to equal treatment in relation to his or her "basic working and employment conditions" as if he or she were directly recruited by the hirer to the same job. Section 6(2) invokes the use of the derogation available to member states under the terms of Article5.2 of the directive which applies to pay and may be applied only to agency workers who have a permanent contract of employment and are paid between assignments.

Section 7 gives effect to the derogation provided by Article 5.3of the directive which facilitates the social partners to develop collective agreements at the sectoral or enterprise level to establish arrangements which deviate from the working and employment conditions of agency workers, provided such are appropriately balanced to ensure the overall protection of agency workers. This section provides the framework in which the Labour Court will decide whether to register such agreements that have been agreed.

Section 8 is a consequential amendment linked with sections 7 and 8 of the Employment Equality Act 1998. Section 9 brings agency workers as defined in the Bill within the scope of the Terms of Employment (Information) Act 1994.

Section 10 provides that an agency worker is entitled to be provided with information on job vacancies within the hirer available to a comparable employee. Section 11 sets out overarching principles to help improve the situation of agency workers, mainly with a view to enabling them to gain access to permanent employment.

Section 12 prohibits the charging of work-seeking fees by employment agencies. It strengthens the current provision under the Employment Agency Act 1971.

Section 13 provides that an agency worker is entitled to be treated no less favourably than a comparable employee in relation to access to collective facilities and amenities provided by the hirer for employees. These include canteen, workplace crèche or transport services and provide that less favourable treatment in terms of access by agency workers to these facilities can only be justified if it is based on objective grounds.

Section 14 outlines the relative responsibilities of the employment agency and the hirer and in relation to the obligations of both parties and the necessary flow of information to comply with the terms of the Bill. Subsection (2) is designed to allow the employment agency to be compensated in the event that the hirer fails to comply with the terms of subsection (1).

Section 15 brings within scope of the Employment Agency Act 1971 an employment agency within the meaning of the proposed transposition legislation. Section 16 ensures the Employment Agency Act 1971 regulating employment agencies generally, through licensing, applies to temporary work agencies as defined under the current legislative initiative.

Sections 17 to 19, inclusive, meet the terms of Article 7 of the directive by providing that agency workers should be included in the context of calculating the thresholds above which bodies representing workers are to be formed and provide that agency workers should be included in the thresholds for the establishment of representative bodies of the temporary work agency in respect of the information and consultation requirements of various enactments on this issue.

Section 20 to 22, inclusive, include standard whistleblowing provisions. Section 23 provides for the manner in which complaints in respect of the contravention of provisions contained in the legislation will be dealt with and must be read alongside Schedule 2 to the Bill.

Schedule 1 appends a copy of EU Directive 20087104/EC on temporary agency work. Schedule 2 contains standard complaints and redress provisions applicable and procedures to be followed by the various parties in respect of any breach of a right to equal treatment. The employment agency will be responsible for dealing with any rights for which it is responsible. Liability in relation to access to employment notices - section 10 - and collective facilities - section 13 - falls solely on the hirer as the agency has no role in the delivery of such rights. The redress provisions in Schedule 2 are modelled on the provisions in other employee protection legislation such as that relating to fixed-term work.

It is my intention on Committee Stage to bring before the House a number of amendments in order to clarify or strengthen the intent of certain provisions of the Bill or align them more closely with similar provisions in other enactments. I commend the Bill to the House.

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