Ruairi Quinn (Dublin South East, Labour)
Link to this: Individually | In context

Question 75: To ask the Minister for Enterprise, Trade and Employment if his attention has been drawn to the fact that certain agricultural producers, in particular in the mushroom-picking industry, are forcing employees to present themselves as independent contractors or to work for piece-rates in order that the payment of the minimum wage and other labour entitlements can be avoided; if he will undertake to have an inspection carried out in an enterprise (details supplied) in County Tipperary to ensure that the standards of employment are compliant with the legislation for which he has responsibility; and if he will make a statement on the matter. [38041/06]

Tony Killeen (Clare, Fianna Fail)
Link to this: Individually | In context

I am aware through a variety of sources that there is particular concern with regard to the alleged practices of some employments in the mushroom industry. The labour inspectorate of the Department is aware that the application of piece-rates is a feature of the remuneration structure of many mushroom enterprises. The payment of such rates is not in itself a contravention of employment rights legislation subject to workers receiving a total remuneration package which is not below the statutory minimum rates of pay for that industry as set out in the appropriate employment regulation order, ERO.

The Deputy will be aware that Irish employment rights law makes a distinction between a contract of service, which applies to an employer-employee relationship, and a contract for service, which applies in the case of an independent sub-contractor. In effect, employment rights legislation does not apply to independent sub-contractors with the exception of the Safety, Health and Welfare at Work Act 1989 and the Equality Act 1998.

In most cases it will be clear whether an individual is employed or self-employed. Where there is doubt as regards the employment status of an individual the relevant Departments and agencies will have regard to the code of practice for determining employment or self-employment status of individuals. This code was drawn up and agreed in 2001 by the Revenue Commissioners, the Department of Social and Family Affairs, the Department of Enterprise, Trade and Employment, the Irish Congress of Trade Unions and the Irish Business and Employers Confederation.

A number of criteria are set out in that code for determining whether an individual is an employee or self-employed. These include whether the person is under the control or direction of another, owns his or her own business, supplies labour only, receives a fixed wage, is exposed to financial risk, assumes responsibility for investment and management, supplies materials for the job, can sub-contract the work or works set hours or a given number of hours per week, month etc.

The labour inspectorate has encountered a claim by an employer in the mushroom industry that workers were engaged on a sub-contract basis and were not, therefore, subject to employment rights legislation. In this case the scope section of the Department of Social and Family Affairs, following consideration of all the relevant facts, decided that the workers involved were employees. This decision facilitated a recent Employment Appeals Tribunal award in favour of a number of former workers in that enterprise.

A major package of measures has been agreed by the parties to Towards 2016, the new social partnership agreement, to provide for enhanced public confidence in the system of compliance. New legislation will be published next year to provide for enhanced employment rights measures, including the establishment of the Office of the Director for Employment Rights Compliance. Providing for greater clarity in the application of employment rights legislation to employees and the self-employed will be considered in the context of drawing up that legislation.

The proposed legislation will also empower the labour inspectorate to join with the Department of Social and Family Affairs and the Revenue Commissioners to work together in joint investigation units. Such units will have a particular focus on the employment status of workers.

In so far as the mushroom concern, details of which have been supplied by the Deputy, is concerned, I can confirm that two inspections of that enterprise have been conducted during 2006, the most recent of which was on 1 November. Breaches of employment rights legislation were detected on both occasions. These breaches have been rectified and all arrears due will be paid to the relevant employees. A file is being prepared for the Office of the Chief State Solicitor.

Ruairi Quinn (Dublin South East, Labour)
Link to this: Individually | In context

I thank the Minister of State with responsibility for labour affairs for his frank and honest response to my question, unlike his predecessor. We have a problem here. For people coming to this country in the hope of a better life, as so many Irish people did when they went abroad in the past, the Celtic tiger has become the Celtic predator. It is now beyond any reasonable doubt that the entire mushroom industry needs to be seriously investigated. That is not to say that every mushroom producer is breaking the law, but there is now enough public information to suggest that this is a crisis sector that requires a crisis response.

What action does the Minister of State propose to take, for example, as regards the cases I cited to him, where there were two registered breaches of unemployment law? One can presume, on the basis, for example, of a case in Carrickaboy, as reported in The Anglo-Celt, where 13 foreign national mushroom pickers were employed, that they were unfairly dismissed because they were, in effect, employees and not contractors.

What action does the Minister of State propose to take because this is a sector that needs to be dealt with collectively, in tandem with the Department of Agriculture and Food, where this is relevant? That would send a signal to other rogue employers and sectors which are difficult to inspect and monitor, given the limited force of the Department's current inspectorate.

Tony Killeen (Clare, Fianna Fail)
Link to this: Individually | In context

There certainly is a problem on the basis of some of the information we have received. The labour inspectorate has targeted this industry in recent times, with 40 investigations, 28 of which are ongoing, in contrast to 12 last year and only seven the previous year. The inspectorate has been following up in this area. I have met SIPTU on a number of occasions and a group that represents some of the employers. There is a suspicion that this group represents the best employers, but in any event, it represents some of them. SIPTU and that group have been trying to agree the basis for a new ERO, which may well be required for this subsection of the agriculture sector. When I met the SIPTU representative last week, he indicated the union was unhappy with the rate of progress and I shall convey that to representatives of the mushroom industry when I meet them in the next week or two, with a view to ensuring that progress is made on that.

Ruairi Quinn (Dublin South East, Labour)
Link to this: Individually | In context

I welcome what the Minister of State has said. I suggest he tell all the mushroom industry representatives he meets that under no circumstances will work permits be granted to them for workers coming from outside the EEA. There is a suggestion that applications are being made for Chinese and Thai workers to come into mushroom enterprises because eastern European workers, who are now full citizens of the European Union, are no longer staying in those plants. I expect the Minister of State is as familiar as I am with all the evidence which SIPTU, particularly Mr. Mike Jennings and others, have gathered.

On the basis that we are sharing the same information, will the Minister of State say that he is considering an ERO or a joint labour committee-type floor hourly rate, irrespective of the nature of the contract, because we had something similar as regards contract cleaning in the 1980s? Such a regulation should be imposed by the Department. Will he say that given the EU workforce as it currently stands, certainly with the accession of Bulgaria and Romania, under whatever working arrangements are provided for by the Department, no applications for work permits will be entertained from persons outside that area, and that there will be a vigorous programme of inspection, regulation and invigilation of this sector? The mushroom sector is a good story in our agrifood business. Those who comply with the law, make a fair profit and pay decent wages will not be undercut by unscrupulous employers.

Tony Killeen (Clare, Fianna Fail)
Link to this: Individually | In context

I would like to see a new JLC or ERO in this sector, ideally in co-operation with employers and unions. That would benefit the industry and workers tremendously. There are some deficiencies in respect of records, as Deputies are aware. This will be addressed in promised legislation under Towards 2016. The legislation on work permits introduced by the Minister will address all the issues outlined by Deputy Quinn. This will help to ensure standards are much better in the mushroom industry and others.

Ruairi Quinn (Dublin South East, Labour)
Link to this: Individually | In context

The Minister of State could give a signal that he will not entertain work permits for the sector.

Tony Killeen (Clare, Fianna Fail)
Link to this: Individually | In context

It will take place in January. The signal given in the legislation is strong. There is no doubt where we stand on the rights of workers.