Michael Healy-Rae (Kerry South, Independent)

I acknowledge the presence of the Minister of State, Deputy Perry, and thank the Technical Group for facilitating me by providing time to allow me to speak on this important Bill. I am pleased the legislation is receiving the time and attention it deserves. Considerable work has gone into it and its provisions merit significant debate.

The workers affected by the legislation are among the lowest paid and most vulnerable members of the workforce. Employment regulation orders cover hotel workers, restaurant staff, agricultural workers, cleaners and those employed in catering, hairdressing, retail and security. Registered employment agreements cover the construction industry and electrical contractors. These orders and agreements cover rates of pay and working conditions. The workers concerned must frequently work anti-social hours, including Sundays. Even though I am a young man, I remember that a time when anyone driving from County Kerry to Athlone would have found only two places to buy petrol on a Sunday. This may be hard to believe but it was not many years ago. Nowadays, every outlet is open on Sunday. We all remember a time when one was fortunate if one could buy a newspaper on a Sunday because shops only opened for a couple of hours as opposed to all day and night. Times have changed and the Government must achieve a balancing act as it tries to protect lower paid workers while also creating an environment in which people will create jobs and become valuable employers.

The proposed legislation was drafted as a result of the High Court decision in John Grace Fried Chicken and others v The Catering Joint Labour Committee and others. It found that certain provisions of the Industrial Relations Acts were unconstitutional. The Bill satisfies a number of conditions in the EU-IMF programme of financial support for Ireland. It aims to reform the joint labour committee, JLC, system to better reflect the current economic climate and provides new criteria for the creation of employment regulation orders, EROs, and registered employment agreements, REAs. It also introduces the condition that the EROs and REAs will only have legal effect upon ministerial orders and Oireachtas review.

The Labour Court can temporarily exempt employers from the terms of REAs and EROs if certain conditions are met, for example, there must be a risk of lay-off and the exemption cannot have a distortive effect on competition. The proposed exemption is a cause of concern because while it is clearly necessary, we must ensure it is not misused or used in an unscrupulous manner.

The joint labour committees will have the capacity to set a basic adult rate and two other minimum rates. These will take into account factors such as length of service and skills. A review of each JLC will take place every five years. New criteria for the creation and variation of EROs will take into account factors such as the legitimate interests of the employer and employees, competitiveness, sustainability, levels of employment in the sector, conditions in comparable sectors and the minimum wage. While the JLCs will not set a Sunday premium rate, protections will remain under the Organisation of Working Time Act 1977. In addition, a code of practice is to be drafted to provide guidance to employers and employees on the issue of Sunday working. The Bill proposes a new procedure whereby the terms of an agreement may be varied by the Labour Court and recommends less onerous record keeping requirements for employers.

I propose to address first the good points of the legislation. Clearly, the Government had to act following the High Court judgment because the workers covered by employment regulation orders and registered employment agreements would otherwise have been left without protection. The Bill is important from the point of view that it will apply to 200,000 workers. Moreover, it provides for oversight of the process by the Oireachtas and allows greater flexibility for employers facing financial difficulties to obtain temporary exemptions from employment regulation orders in certain circumstances. Such derogations will be granted in cases of proven economic difficulty following consultation with the employees concerned.

On the negative aspects of the legislation, perhaps it should be more specific about Sunday premiums. We must await the code of practice before learning what provisions will apply in this area. Workers should be adequately compensated for working on Sundays as it is unsociable to do so. Given the current state of the economy, employers need to be able to be competitive and more flexible if jobs are to be created in the sectors in question. There is a danger that further constitutional challenges could be taken against the legislation and some employers' groups have already threatened to do so. The inability to pay clause available to employers may become a cause of concern if employers use it as a means of circumventing the provisions of the legislation. I also note that the Restaurants Association of Ireland is outraged by the Government's decision to reintroduce the joint labour committee wage setting system.

Ireland's €8.65 per hour minimum wage is one of the highest in Europe, according to the association. It said the minimum wage is €9.10 per hour in France, €7.06 in the UK and €4.01 in Spain.

The Irish Hotels Federation was also critical of the retention of the JLCs which it described as an outdated and regressive employment framework. Mr. Tim Fenn, chief executive of the body, queried the constitutionality of the proposed reforms and described the JLCs as an impediment to job creation. The Construction Industry Federation also expressed its disappointment, saying the proposals did not go far enough to meet competitiveness challenges in the sector.

The Irish Small and Medium Enterprises Association said the proposed reforms would push struggling companies over the edge. The ISME chief executive officer, Mr. Mark Fielding, said the core issue of general pay had not been sufficiently addressed.

IBEC also slammed the Government's Industrial Relations (Amendment) (No. 3) Bill 2011 and said that the plans by the Government to reintroduce the JLC wage setting system, as set out in the Bill, were misguided and unnecessary. Reacting to the publication of the Bill by the Minister for Jobs, Enterprise and Innovation, Deputy Richard Bruton, IBEC director, Mr. Brendan McGinty, said:

While some of the proposals, such as the abolition of Sunday premiums, are an improvement over the last regime, the entire JLC system should have been consigned to history.

The High Court decision of last summer did not provoke the crisis some predicted. Employers have respected the fact that existing employees have contractual rights to established JLC rates, unless and until they freely agree otherwise. Any attempt to reinstate the JLC system will be fraught with constitutional uncertainty and will be open to further legal challenge.

Ireland has the second highest national minimum wage in the EU, and all employees are protected by over 40 pieces of employment legislation. The move to bring in new legislation means that workers in some sectors that can least afford it will have higher sectoral minimum wages and other benefits not available to other private sector workers. The government proposals are arbitrary and unnecessary.

Having said that, it is very important the message we send from this House is that small business people are the backbone of Ireland's business. These people created one to four jobs. These businesses, along with agriculture, were the backbone of Ireland's business over the years. Unfortunately, we have seen many small shops and small businesses close. I am not one bit slow about saying there were 27 shops and six pubs in the village in which I grew up. Today there are two shops and two pubs. That is reflected in every town and small village in the country. All of those people created a job for themselves and, if they had additional work, they hired help and those people were very glad to have work.

I have heard colleagues, who I respect very much, talk about unscrupulous employers. There are cases in the media at the moment and none of us is happy about the situation in which workers find themselves. In the main, those who employ other people respect them. Everybody is pulling together. The business person who is creating the job must make money to keep a person in the job. If he or she is not making money, the door closes. The Government and the Opposition must ensure mechanisms are put in place which will protect the worker, in particular the lower paid worker, and ensure no worker is blackguarded in his or her place of work.

The hotel sector has grown enormously over the years. There are families in Ireland which are steeped in the hotel business. In Killarney town, generations of families have worked very hard in the hospitality sector and they have grown their businesses and borrowed vast amounts of money. They are not like some of the fly-by-nights who ran away; these are respectable people who borrowed money, improved their hotels, put in leisure complexes and enhanced their businesses greatly. They have increased enormously the number of people working with them. I will not say working for them because these are family hotels. There is a big difference between working for somebody and working with somebody. I am one of those for whom nobody has ever worked. People have worked with me and that is the way business should be, how one grows a business, gets the trust of one's employee, gets an employee to be as worried about one's business as one is so that he or she is as interested in keeping one's door open as one is. That is what is important.

The hotel industry has raised the bar for people who visit our country. They have excellent facilities and the best of restaurants. I refer to the Restaurants Association of Ireland and the great improvements which have taken place in places such as Dingle, Kenmare, Kinsale and other places. The country is dotted with great businesses that have built up reputations which are very important to them. Under no circumstances would those people like to be classified in this House as unscrupulous employers. They are respectable people who are creating jobs and want to stay in business. We must be very clear that the proper message is sent from this House.

Whatever way Members vote on this Bill, we must remember that at the end of the day, it is about sustaining jobs, creating a protective environment for workers and ensuring that the message is sent that it is not a sin for employers to want to make a profit to ensure their businesses will be there the following year and for future generations.

Small businesses have had to reinvent themselves because of new regulations. Every day small business throughout the country are subject to all types of inspections and regulations, including accounting standards and hygiene regulations. This is all good but it places an additional burden on businesses which are already struggling and under severe financial pressure.

SIPTU's views on this matter are very important also. In July, when the Minister announced his intention to introduce legislation which, effectively, dismantled the EROs and REAs which set out the rates of pay and conditions for low paid workers, SIPTU, other trade unions and organisations representing low paid workers campaigned intensively to ensure that all workers previously covered by the wage setting mechanism would continue to be protected under the new provisions. They have managed to achieve this, although they were disappointed the Sunday premium was excluded from the provisions published. Workers will, however, be able to achieve a Sunday premium through a new code of practice to be developed by the JLCs. They said the Minister has also agreed to include the provisions to ensure employers pleading inability to pay the agreed JLC rates would have to satisfy the Labour Court that they are genuinely not able to do so. They will also have to satisfy the court that any exemptions granted will have to take into account any distortion effect in the relevant industry.

I note what the Mandate trade union said at the time: it acknowledged the progress embodied in the draft legislation. Mandate's general secretary, Mr. John Douglas, said this progress had been brought about by the hard work of many Oireachtas Members, the trade union movement and campaign groups such as the coalition to protect the low paid. Mr. Douglas argued, however, that much work was required to turn this Bill into legislation the trade union movement can fully support, particularly with regard to Sunday premiums and the ability-to-pay clause introduced for employers.

Since the High Court overturned the JLC system of regulating wages and other terms and conditions for low-paid workers, Mandate has been working with many others to ensure a replacement system was put in place. They are aware that much work needs to be done to continue the fight to protect low-paid workers.

I hope the spirit of the Bill will ensure that our competitive enterprises will be able to stay in business in the years ahead, and that workers' rights will be protected.

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