Leo Varadkar (Dublin West, Fine Gael) | Oireachtas source

The argument I am making, which I often make, is one in favour of incremental progress. I appreciate that for many people progress is too slow, but I have a responsibility as Minister to listen to all sides of the argument and to look at it from the point of view of employers as well as that of employees. In my view, the most important workers' right is the right to work, and I want to raise the bar continually to improve pay, terms and conditions and workers' rights, but not to the extent that businesses will become unviable. Business owners, in particular small employers, not least around the Border area and in small towns, tell me a lot is coming at them at the moment, such as higher labour costs, input costs, energy costs and insurance costs, which I am working on, as well as higher costs the Government is putting on them. Those costs include ones arising from the additional public holiday, for which I signed the order and which I stand over, and from auto-enrolment, which I kick-started as Minister for Social Protection and stand over also. These are all additional costs for employers and I do not want to end up, with every good intention, putting workers in a bad position whereby their employer will be forced to lay them off, reduce their hours or even reduce their pay, because that would be counterproductive.

Comparisons that are being made with other European countries are a little misleading because they do not take into account illness benefit. Many countries have an integrated system of sick pay and illness benefit. What will happen with the Bill, when this new right comes into place, is that for the first three days, sick pay will be provided by the employer, after which illness benefit will kick in for up to two years. It is not the case it is only three, five or ten days, given illness benefit will kick in.

Moreover, it needs to borne in mind that where there is better provision for sick pay, as is the case in many European countries, it is based on a very different social insurance system, whereby the average social insurance contribution for employers is 20% rather than 10%, and whereby low-paid workers pay a lot more in income tax and social insurance. In several of the Nordic countries, low-paid and minimum wage workers pay five, ten or 13 times as much income tax as they do here, and I do not think it is a very honest argument to say low-paid and minimum wage workers should have the same social insurance benefits as people in Nordic countries but should not have to pay the kinds of high taxes they would pay in a Nordic country.

See this speech in context