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

I thank Deputy Collins. Yes. I met her. She spoke at a May Day conference that we held just a few months ago. She was very impressive. It is easy to sit on the other side when you win, but she told us about the toll it took on her to get to the point where they did win on that and how nothing much has changed for other people that she knows, who she is trying to organise within the industry. It is really important to listen to people like her because it shows just how vulnerable workers in that industry are.

At its appearance before the Labour Court, The Ivy admitted that it had introduced a mandatory service charge on every table, which negatively impacted on the amount of tips left for workers. Because, of course, when you assume a service charge goes to service workers, then you are very unlikely to leave an additional tip or perhaps not as much. Therefore, it is concerning that this Bill allows mandatory charges to be taken by an employer and used as general income of the business as long as they are no longer called service charges. As mentioned by Deputy O'Reilly earlier in the debate, several members of the Restaurants Association have already identified this as a loophole and it is something that has been discussed on social media. For poor employers who are already stealing the tips or service charges of their employees, despite the very clear moral issue, this gives them an avenue to continue the practice with a more consistent income. It is important that we identify the loopholes.

Mandatory charges result in higher bills for the customer, which are not easily calculated by just looking at the individual pricing on a menu. It significantly reduces the chances of customers leaving tips for workers. I understand that the Tánaiste listened to the concerns and introduced an amendment to exclude mandatory service charges from making up any portion of the basic wages of staff. However, could he outline why it stopped at mandatory service charges? Why is it that mandatory group booking charges, for example, can be included? Again, it is down to the loopholes. It is incredibly important to bring transparency into the processing of tips and gratuities in the service industry.

Unite's general secretary, Sharon Graham, has said:

Where tips policy is unclear it usually means it is also unfair, and it hits this workforce hard in the wallet. We estimate that hospitality staff lose thousands a year in lost earnings when their tips go elsewhere.

Of course, low pay and tip theft is only one of the issues facing workers in the service industry. A Fáilte Ireland survey found that many staff complained of not getting proper work breaks, having their hours changed at the last minute, and approximately 33% did not receive any extra payment for working on bank holiday weekends.

It is a difficult and insecure sector to work in. Given the make-up of its workers, short-term contracts, language barriers and low trade union density, the workers are very vulnerable to abuse. Globally, low trade union density runs parallel to inequality. Where workers have little or no collective bargaining power and have very little awareness of their basic workers' rights they are often open to exploitation. A right to collective bargaining is essential.

When we look at social democratic Nordic countries such as Sweden and Denmark, they do not have a minimum wage, yet the average rate of low pay in those countries is approximately 8% compared to 20% here. They do not need a minimum wage because they have collective bargaining. More than 80% of employees are covered by collective bargaining agreements, compared to approximately 33% in Ireland. Crucially, in Ireland, the sectors with the lowest traditional pay have the lowest density of trade union membership. I acknowledge that the fair distribution of tips will help people a lot, but if we are serious about ending the scourge of low pay in this country then we need to introduce a right to collective bargaining.

One of the stories in the media in recent months is some of the charges that are being levied in terms of room rates in some hotels. I looked at some of them myself. They are astronomical. The sector is price gouging. It does no service to it. Low pay predominates in the sector and its workforce is very vulnerable. When we consider the post-crash situation and the importance of non-domestic tourism in terms of the recovery, we are doing ourselves no service by having a situation whereby there would not be a secure employment base for the sector.

That secure base will not be achieved unless there are attractive rates of pay and certainly rates above the poverty line. Where there is activity like price gouging, it does not do anybody any favours in the longer run. The totality of these issues must be considered and there must be engagement with organisations like the Irish Hotels Federation in this regard. Of course, there are people who are running their hotels and restaurants fairly and diligently but the cohort of those who are not are doing everyone a disservice.

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