Catherine Murphy (Kildare North, Social Democrats) | Oireachtas source

Like others, I will be supporting this Bill and its progress. Probably, the only surprising aspect is that workers require this kind of protection. Most people would have assumed that when a tip is given, the tip goes to the worker.

One in five workers in the State is classed as low paid, that is, approximately 370,000 people. Ireland's rate of low pay is significantly above the EU average, ranking 8th out of 27. Among other high income countries in the EU, we have the second highest rate of low pay. This is not a new problem. For the past 20 years, the rate of low pay has remained consistently at approximately 20%. This is a major structural issue which affects every aspect of our society. Low pay has negative physical and mental health impacts on the health of workers. It absolutely undermines their quality of life. The economy suffers from the lack of purchasing power of low-paid workers. Public finances and, therefore, public services are weakened by the low levels of revenue taken in by way of taxation.

Low pay is feeding into homelessness and inadequate housing for working people and their families. Many low-paid workers cannot keep up with rising rents and cannot qualify for mortgages due to the increasing gap between their incomes and house prices, which are very considerable.

Low pay is not only absolutely irrational on a broad economic level; it is morally bankrupt. The Government likes to brag about the low unemployment figures in Ireland in comparison to other EU states and to proudly show off statistics that say we have the highest rate of youth employment in the EU, but one must ask how much they are being paid.

The hospitality and tourism industry has one of the youngest workforces. It is predominantly made up of women, and between 33% and 40% of workers in the industry are migrants. According to a recent study by Fáilte Ireland, 68% of them are being paid less than the living wage. Is it any wonder that more than 40% of the sector's workers did not return to their jobs post-pandemic? There is a problem with recruiting. People are looking at it rationally, in terms of the cost of living and their earning power.

For many people in the service industry, tips make up the difference. The level of tips received can dictate whether there is enough money in the bank to put food on the table, pay the bills and live any kind of dignified life in such an expensive country.

In light of that, I welcome much of this Bill. Placing tips and gratuities outside the scope of worker's wages is a very important step forward. When anyone leaves a tip, it is done with the implicit understanding that it will go to the person who has provided the service, and that it is an added bonus to the person's wages and an appreciation of his or her work on behalf of the person who receives the service.

No one who leaves a tip expects or wants it to be taken by the employer. It is up to every business in the service industry to calculate its profit in its pricing. It cannot be left to the customer to provide extra money voluntarily to make up the basic business costs of the establishment.

It is good to have legislation clearly setting out that tips taken electronically must be distributed to the staff. Especially after Covid, this has become much more common and it is likely to become the dominant method of tipping, if it is not already. It has been very unclear in recent months where those tips are going. I have heard from many people that they have developed a habit of asking staff directly whether they receive the electronic tips before giving them. Some people carry cash so that they can have a higher degree of certainty about that.

In other establishments, I have noticed staff automatically clicking "No" to electronic tips before handing the card machine over, because they know they will not receive them. That tells us something about the way people feel about the issue. It is theft. If people leave a tip, they want to be sure that the person serving them gets the tip. A crucial and welcome aspect of this Bill is a right to redress for employees who do not receive electronic tips, which will be through the WRC. However, this does not seem to be the case in respect of cash payments. I understand the Department was advised by the WRC that ensuring cash tips go to workers would be unenforceable, but I feel some action must be taken. This Bill makes great improvements to the situation in the sector around tips and optional service charges, but cash tips are a major avenue for people to earn an essential increase on their low salary.

When it comes to the obligation for employers to display their policy of distributing tips among staff, it is absolutely crucial that the tips and gratuities notice is easy to find and is available to customers both before booking and before paying. Such notices must be properly signposted and not hidden behind a plant where people do not see them but with employers fulfilling their obligations under the law. We must be quite specific about that. It is important to ensure the notices are prominently displayed. The regulations need to be very clear about defining the concept of "prominently displayed" and, critically, it needs to be enforced. That goes without saying. I am not sure who would do the enforcing. The Minister might come back on that point.

The language in the Bill dictates that an employer must consult workers if he or she plans on making any changes to the distribution of tips. Consultation is not enough. It really is their money. It is fundamentally not the employer's income, so it should be up to the workers to determine how they split their tips. Any changes should be done with the consensus of employees.

Service charges are the area in which I believe the Bill is weakest. Under the current legislation, any business can implement a service charge - mandatory or voluntary - and take it as revenue. Most customers do not realise this. It seems fairly straightforward that the service change would go to the workers who are providing the service. We most often see such a service charge when booking for groups. Many people wrongly assume that the charge functions as a kind of built-in tip for the worker as a consequence of being responsible for a large table. I assumed that as well, wrongly so.

The Ivy restaurant was at the centre of a campaign and national conversation about tip theft, spearheaded by Unite's Julia - I always pronounce this name wrong.

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