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

I move amendment No. 2:

In page 5, between lines 23 and 24, to insert the following: “Employment contributions

3.(1) Section 13(2) of the Principal Act is amended by the insertion of the following paragraphs after paragraph (db):

“(dc) Subject to paragraphs (dd) and (de), where the Minister has made an order under subsection (1A) of section 10D of the National Minimum Wage Act 2000, he or she may, by order, vary the amount of reckonable earnings specified in subparagraphs (i) and (ii) of paragraph (d).

(dd) An order under paragraph (dc) shall come into operation on the same date as the order under subsection (1A) of section 10D of the National Minimum Wage Act 2000 to which it relates.

(de) An order under paragraph (dc) shall, in so far as practicable, provide that the same proportion of the reckonable earnings of an employed contributor is subject to the rate specified in subparagraphs (i) and (ii) of paragraph (d) on and after the date on which the order comes into operation as it was subject to immediately before that date.”.

(2) The amendments effected by subsection (1) shall come into operation on the passing of this Act and shall cease to have effect on the date on which a recommendation under section 10C of the National Minimum Wage Act 2000 is next made to the Minister.”.

As I explained on Committee Stage, I am bringing forward two amendments relating to the minimum wage in direct response to the amendment tabled by Deputies Penrose and O'Dea. The first of these, amendment No. 2, will ensure that when the order to implement the increase in minimum wage is signed, I will also be able to provide for parallel increases in the PRSI earning thresholds. This will ensure employers are not doubly hit when the minimum wage is increased. The weekly earnings of an employee determine the rate of employer contributions paid on behalf of that employee. Currently, employer PRSI is charged at a rate of 7.8% on weekly earnings between €38 and €386, and at a rate of 10.5% on earnings in excess of €386. When the minimum wage is increased from €9.80 to €10.10 per hour, I will also adjust the €386 earning threshold to ensure that, as in previous years, the same proportion of the employer's contribution is paid at the lower rate.

The second amendment amends the National Minimum Wage Act 2000, which is necessary to provide for the increase to the minimum wage. I reiterate that the Government has accepted the recommendations of the Low Pay Commission in their entirety and we wish to provide for that increase of the minimum wage to €10.10 as soon as possible. We discussed this on both Second Stage and Committee Stage. The amendment also provides that these measures are a once-off and will cease to have effect once the next report of the commission is published. The sunset clause applies to the power to introduce the order to increase the minimum wage and the power to adjust the rate of the PRSI earning threshold. I hope Deputies Penrose and O'Dea find the effect and intent of their amendment is fully met by these amendments, which were prepared with the Office of the Parliamentary Counsel, and that they are in a position to support them.

The effect of Deputy Bríd Smith's amendment is to delete section 23, which would make it impossible to provide any increase in the minimum wage in 2020. I do not believe that is what the Deputy wants. I think she wanted to register her displeasure at us not having already increased the minimum wage, which I understand. If we were to accept her amendment, none of us would be able to do anything about the minimum wage, and nobody would get an increase next year.

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