Denis Naughten (Roscommon-South Leitrim, Fine Gael)
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I welcome the opportunity to speak on the Employment Agency Regulation Bill 2009. I welcome the introduction of this legislation, which has been promised by the Government for some time. It is a positive move. I hope it will address some of the anomalies encountered by agency workers, as well as those who recruit them and bring them to this country. The vast majority of people who come to Ireland through the agency system are involved in legitimate forms of employment. In many cases, they are paid more than people who are ordinarily resident here. It is a favoured option for many people who want to gain employment here. They enjoy a level of flexibility and get an opportunity to improve their skills. They may have decided to go down this road for lifestyle or other reasons. Agency work gives people a chance to travel and experience work practices in other EU countries. Not only has it been used in this country, for example in the health system, but Irish people have also gone abroad to avail of similar systems. Far more Irish people will be going abroad in the years to come, sadly, because of this country's economic problems.

Anyone who has followed this issue over recent years will be familiar with the type of exploitation that takes place. The use of agency workers was a hot political issue in the early 2000s. I welcome the proposal in this legislation to introduce a licensing system. When the Minister of State responds, I hope he will talk about the protections that will be put in place for agency workers. Some workers, like employers, have to pay fees to employment agencies. I accept that certain checks and balances are being put in place in this regard. They can be examined on Committee Stage. If a licence is withdrawn from an agency, it is important that fallback arrangements are in place to protect employers and workers. The example that comes to mind is the bonding system used in the travel agency sector. We are all familiar with that system, which seems to be quite successful.

I hope a number of my concerns about this Bill will be clarified on Committee Stage. The Bill provides for the establishment of a code of practice, which will set out the practices and standards to be met by employment agencies. The code will also provide practical guidance on the approach to be adopted when queries are made, etc. While the code of practice is positive, I would like to raise two concerns about it. This country has a huge problem with providing information to ordinary citizens. When people are trying to get information, they often choose to go to citizens' information offices or contact public representatives rather than use the Internet. On-line information is often spread across different websites, or parts of websites. Different types of search engine have to be used when one is looking for information on social welfare and PRSI entitlements, for example.

I presume information about this legislation will be posted on the website of the Department of Enterprise, Trade and Employment under the heading of "agency workers". In the past, factually incorrect and outdated information has been allowed to remain on departmental websites. The Department of Justice, Equality and Law Reform probably has the worst record. I ask the Minister of State, Deputy Kelleher, to publish on a single website all the data of relevance to foreign workers and migrants who come to this country. I refer to information about the basic functioning of this country, on matters as varied as the Department of Social and Family Affairs, the Road Safety Authority, our labour laws and the role of the Department of Justice, Equality and Law Reform in issuing visas. The duties of people who want to come to this country and contribute to this economy should be laid out in plain English. The information that is currently available is scattered all over the place. It is difficult enough for Irish people to access such information, but it is far more difficult for people from outside Ireland whose first language might not be English.

I am sure the Minister of State, Deputy Kelleher, and Deputy Costello, have dealt as I have with the cases of people who came to this country under the work permit system or some other system, but have fallen out of the system because they did not comply with some rule or other. In many instances, they were not aware that they had to comply with the rule. It is important to bring all of this information together. Many non-governmental organisations are willing to translate it into various languages so that it can be available on websites at no cost to the taxpayer or the State. In the past couple of days, all of us have received an extremely useful booklet from Crosscare that could be used as a blueprint for the development of an effective website that would benefit us all.

The second aspect of the code of practice about which I have concerns is the question of whether it will have any statutory authority. I am sick and tired of people giving the two fingers to codes of practice which have been put in place across the board in name only. The Tánaiste spoke this morning about the codes of practice that apply to retailers. No one honestly believes that retailers are complying with the codes of practice on below-cost selling and the exploitation of suppliers.

I wish to speak about the many workers in this country who are exploited. I appreciate that the number of agency workers who are affected by exploitation is quite small. As the former Minister of State with responsibility for labour affairs, the Minister of State, Deputy Kelleher, is fully aware of this problem. The people of Ireland, above all other countries, should be conscious of the implications of the exploitation of workers. Over the years, thousands of Irish people went abroad only to be exploited by employers who do not have any moral fibre. That is now taking place in this country, sadly, although it is difficult to know the extent of it. While there was much more talk about exploitation during the good times, I firmly believe that undocumented migrant workers and people who are illegally resident in this country continue to be exploited by unscrupulous employers.

I spoke recently to an employer who has submitted tenders for public contracts with his local authority. The man in question became so sick of his failure to get previous contracts that he submitted a below-cost tender on which he would have lost money. He failed to get that contract. He firmly believes it is not possible for those who secure such contracts to fulfil them within this laws of this country. He put in a tender below cost but still failed to get the contract. The point he made to me was that the only way the other employer could have won the contract was to have paid below the minimum employment rate. We all know this is happening in other areas but it is difficult to eradicate it. The State has a good idea of prices in public contracts after everything is cut to the bone yet it is prepared to give contracts to tenders well below cost.

While such practice in the supermarket trade is a hot political issue, it is going on in other trades but we continue to turn a blind eye to these practices. I do not know how widespread it is but there have been many examples of the exploitation of agency workers involved in major public contracts such as at the Moneypoint power station. I have reports of many more public contracts where workers have been exploited but the difficulty lies in getting the documentary evidence to support the claims. There is an onus on public agencies when awarding contracts that it is not just the cost bottom-line that is taken into consideration. Recently, I came across a case where a public agency took on a contractor who had failed to deliver on a previous contract. This should not happen. The agency's defence was that the price was so low it could not ignore the tender. Whether it will be delivered upon is another day's work.

Labour exploitation has not come to the fore the way it should have. It is building up and facilitating racism. I am constantly raising with the Minister of State, Deputy Billy Kelleher, the commitment given in the partnership agreement, Towards 2016, to employ 90 labour inspectors by the end of 2007. They are still not in place; at the end of 2009, the complement was still 19 short.

Exploitation has not gone away. I accept industrial relations issues are involved. However, parking that aspect of it, the Minister of State knows as well as I do that the National Employment Rights Authority, NERA, has been going for the low-hanging fruit instead of dealing with more serious exploitation cases in the system. It needs to be prioritised. We were given commitments in the past about cross-departmental joint labour investigation teams. The Department of Social and Family Affairs, the Revenue Commissioners and NERA were to carry out co-ordinated investigations into labour exploitation in which one agency would support the others in collating evidence to identify non-compliance with employment rights and other labour legislation. Have they been put in place? The last time I checked, they still were not. Data is available to the Department of Social and Family Affairs and other State organs which can identify labour exploitation and social welfare fraud. However, this is not collated, co-ordinated or identified.

This is leading to frustration, resentment and annoyance among the public. FÁS has predicted up to 335 people will lose their jobs every day this year. Labour exploitation is eating into this and fuelling resentment which is not good for the country in the long run. Ireland will need new people coming into the country to help turn the current economic circumstances around. The Finance Bill, on Committee Stage this week, contains specific provisions to encourage foreign funds from the Middle East and new high-skilled workers to come to Ireland. Accordingly, we need to stamp down on labour exploitation. It undermines legitimate employment and employers who are being put out of business because they cannot win contracts. It also undermines social cohesiveness.

Even during the good times, the black economy was estimated at €3.5 billion. Foreign labour was a small part of this but the black economy has grown rapidly in the past 18 months. We need to see co-ordination between the various State agencies concerned to ensure labour exploitation is eradicated. It is damaging our economy and leading to the exploitation of our social welfare system.

The Bill provides for exemptions for various agencies. It is not clear whether they will be provided to public institutions, such as FÁS, educational institutions or private companies. There is much potential to develop the education sector in the economy. At a conservative estimate, the foreign student-education sector could bring an additional €1 billion per annum in badly needed capital into the economy and create approximately 6,000 new high-end jobs. However, the regime for foreign students needs to be reformed. It has been promised for the past seven years with review after review but no action from the Government. The regime is mainly focused in the Departments of Education and Science and Justice, Equality and Law Reform.

However, there have been abuses in this sector. Three weeks ago, the Minister for Justice, Equality and Law Reform highlighted the weaknesses in the system during Question Time. He stated:

On inspection some time ago, a college in Dublin 8 had no desks, whiteboards, blackboards, books or papers. The so-called principal was unwilling to open the doors of the college, which effectively was being used as residential accommodation. At another college in Cork that was visited, none of the 70 so-called students who were registered was in attendance. The excuse given was that the students were off on their mid-term break. This site was visited again during the following month, when only eight students out of 59 were in attendance.

I will not leave out the Minister of State, Deputy Billy Kelleher. In September 2008, when I questioned him on this issue of foreign workers and students, he made the point that a loophole existed in respect of student workers and it was something he was actively examining at the Department. Some 18 months later, nothing has been done about it. When the Minister for Justice, Equality and Law Reform, Deputy Dermot Ahern, published his plans on the student education sector, he parked the issue of employment. If we are to seriously deal with the potential to create jobs in this economy, we must tackle the issue of students working up to 20 hours per week and which students will be allowed to work. My recommendation is to revert to the system in place prior to 2000, where someone on a course over 18 months could work within the system but someone here less than that period of time does not have the right to work. When applying for a visa, the student must give a commitment that he or she has the financial resources to remain for that period of time without work.

The Government has continued to long-finger actions that could deal with the racism bubbling under the surface in this country. With hundreds of thousands of people unemployed in this country, including many young people, we are facing a powder keg unless the Government is prepared to tackle these issues head-on in the not too distant future.

Joe Costello (Dublin Central, Labour)
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I am delighted to have the opportunity to speak on the Employment Agency Regulation Bill. I commend Deputy Naughten for the interesting points he made during his contribution and I wish to take up his final point. We must review and regulate the matter of students. We are getting a tiny fraction of the international student cohort that travels around the world. Part of the reason for this is that we do not have a proper policy to attract the student cohort or to make provisions to deal with that cohort when it arrives here. As an international student venue Ireland should be in the top range of the world. That would provide considerable employment and would provide us with a major education reputation in that respect. It should be seriously considered.

Deputy Naughten also referred to finding out where we are in respect of foreign workers. We would like to see an updated situation in respect of people here with or without permits, the proportion they represent of the existing Irish workforce and how things have moved over the period since the boom. One factor that is becoming evident is the number of people who apply for social welfare benefits and are refused because they do not conform to the habitual residency clause. The figure in 2005 was fewer than 5,000 whereas the figure in 2009 was more than 10,500. The squeeze is on and people in part-time work or agency work, which may be less than three months in duration, may be caught in a pincer movement so that they do not qualify for the expected benefits.

Irish citizens coming from abroad find themselves caught in the same net, even if they come from Britain with which we have a free trading area. There are many things that could be put together in order to get a proper picture of where we are. Approximately 40,000 people emigrated last year and it would be interesting to see the number of people who are Irish citizens emigrating, Irish citizens who came back and are leaving once again and short-term immigrants going back to their country. We do not have these figures available but they would be useful.

The legislation is welcome in so far as it goes. It is not timely because it was promised in 2006 and we are receiving it in 2010. A major mistake was made not delivering it in 2006, 2007 or 2008. We had bitter debates about workers' rights in the run-up to the first Lisbon referendum. The most crucial issue was temporary agency workers. They were not getting equal treatment and there was a perception abroad of exploitation hand over fist. Some 650 agencies were operating at the height of the boom in 2007. They were unlicensed and unregulated and there were no inspectors to keep tabs on them. Despite the major demand at the time, the standing joke was that there were more dog wardens than inspectors. We have not reached the required quantity but the boom is over so the quantity required is not what it was. At the time we had six or eight inspectors; there are now 72. There is a major improvement in that respect but they were not available when they were needed.

One of the major reasons people voted against the Lisbon treaty, given by over 40% of those who voted against it, was the concern about workers' rights in this country. We might not have needed a second referendum if the legislation promised in 2004 and 2005 in the social partnership agreement Towards 2016 had been put on the Statute Book in time. There was major concern that neo-liberal practices were coming from the European Union. There was a view that the Commission of the European Union was neo-liberal and that the Government was not taking action to protect people from exploitation. It is ironic that the Commission was doing its best to ensure all workers travelling from abroad received fair treatment.

Ireland, the UK and Hungary held out to the very end to prevent the temporary agency workers directive being adopted. The Minister of State will say they were very good reasons for this but it was not until the Slovenian Government pulled the plug in 2008 and managed to get Hungary offside so that the United Kingdom was not sufficient to create an blocking mechanism that we could get the temporary agency workers directive through. It became operational from December 2008 and must be implemented before December 2011 despite the fact that Ireland opposed it totally. That gave rise to anger, unrest, dissatisfaction and frustration among workers in this country. It contributed greatly to the defeat of the first Lisbon referendum.

The Employment Regulation Act was passed in 1971 prior to joining the European Union in order to protect Irish migrants going abroad, particularly to the United States, so that agencies from the United Kingdom or elsewhere would not recruit Irish workers and have them exploited. It is ironic that this was the basis for the initial regulation in this area. Unfortunately, when the situation was reversed and we had foreign workers coming to Ireland, we did not put the necessary protections in place to deal with the situation. That failure is particularly unfortunate given that after 1973, when we joined the European Union, we were signed up to the free movement of workers, goods and services across the Union. There was a clear need in the 1970s, 1980s and 1990s to act on this requirement of European Union membership. However, it was not until the last ten years or so, after the issue was flagged consistently by SIPTU and the ICTU, that the Government agreed to act. I recall that the Immigrant Council of Ireland also campaigned strongly on the issue.

Now we have a situation where the temporary agency workers directive will have to be transposed into Irish law by 2011 but we do not have the core tenet of that legislation in place, namely, equal treatment as between temporary agency workers and permanent workers. We have no choice but to transpose the directive by the end of next year. I cannot understand why this legislation was not introduced as it should have been in 2006 and instead is only brought forward now when it is too late, with the boom over and very little recruitment taking place. We have an obligation as members of the European Union to introduce much tougher legislation in 2011 but the provisions of that directive are not incorporated into this Bill. Will the Minister of State explain why this is so? I am greatly concerned that an opportunity is being lost to go the whole hog and do this business properly.

Apart from the requirements of the directive, the Minister will also have to look at the Lisbon treaty in its fullness. The Charter of Fundamental Rights is quite specific about workers' rights, and the right to collective bargaining and action is sure to be a hot potato in future discussions. It is a right that is subject to the European Court of Justice for its implementation. This means that if a case is taken, there is a right of appeal to that court and a requirement on the Government to ensure such appeals can take place. Provision will have to be made for the rights of workers to information and consultation in their place of work. Legislation is already in place offering protection against unfair dismissal but it will have to be reviewed to ensure it is adequate. The requirements under the charter regarding the right to fair and just working conditions and the prohibition on the exploitation of all workers will have to permeate all legislation. As I said, the Government must take cognisance of the fact that these matters will be justiciable to the European Court of Justice. It would be useful to go through the existing legislation and the treaty with a fine-toothcomb to ascertain the obligations that will inform all legislation into the future.

During the boom years we attracted much employment to the State, particularly after the major expansion of the European Union from 15 member states to 25 in 2004, and eventually to 27. However, the down side of those boom years was the exploitation of workers that took place, as I know well from my own constituency. It has taken until now, when the country is bust, to deal with the matter. Figures show that while there were 4,000 agency workers in the State in 1999, this number had increased to 35,000 ten years later, the majority of these on short-term contracts of up to three months and one quarter on contracts of less than one month. For persons employed on that basis it was difficult to determine the identity of their employer because they were recruited by an agency before being transferred to an employer with whom their contract rested. That situation gave rise to exploitation in terms of pay and conditions and fixity of tenure. The National Employment Rights Authority, NERA, did not come into operation on a non-statutory basis in 2007 and there were too few inspectors to prevent that type of exploitation. Therefore, there were no mechanisms in place to determine, other than on an anecdotal basis, what was happening during the great years of the boom. I hope this information will be freely available in the future.

The major provision of the Bill is well worthwhile, namely, the requirement that an employment agency based in another EEA country can only operate in this State if its licence or other regulatory status is recognised by the Government. That will go a long way to putting a system in place that can at least be supervised and controlled. It is a question of how well it will be controlled and how well the code of practice will operate. A code of practice should always be statutory if it is not to be open to being broken, but I am not sure to what extent we have that in the Bill. Nor am I sure to what extent employment rights are protected in terms of a clear definition of the tripartite relationship between agency worker, employment agency and employer. That must be clarified because the body of existing legislation relating to these issues is complex and cumbersome. In regard to registered employment agreements and employment orders, it is extremely important that all of these would apply across the board in regard to temporary agency employment and placement employment. These are the matters that will give rise to difficulty, controversy and exploitation and we must be especially careful to ensure that they are dealt with effectively.

The proposal mooted by Deputy Naughten for a cross-departmental investigation team is valuable. Teams of that nature should be put in place. We have seen how successful the Criminal Assets Bureau teams have been in terms of dealing with drugs and assets not within the compass of the person who holds them. This proposal should be examined in the context of the huge amount of information available in the Department of Social and Family Affairs that might not be as readily available to the Revenue Commissioners or the Departments of Finance and Enterprise, Trade and Employment. We need to put in place, in areas no longer under pressure to the same degree as they were in the past, mechanisms that will ensure we have an industrial relations structure, in regard to employment procedures and so on, that does not require the use of industrial relations machinery given it is efficient, effective, well supervised, modulated, regulated and licensed. This is what needs to be done. It has been done in respect of the NERA legislation and is being introduced in this legislation, which I welcome in so far as it goes. I would have liked if the full directive in regard to temporary agency workers had been included in this legislation. Perhaps the Minister of State will, even at this stage, examine that directive to see whether the core elements of it could be included in this legislation by way of amendment.

Martin Ferris (Kerry North, Sinn Fein)
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While the stated objective of this Bill is to strengthen the regulation of employment agencies in line with the concerns of workers and the trade union movement, the context in which it is brought forward for consideration is one of mistrust owing to the manner in which the Government has dealt with the trade union movement, particularly in recent months. The same mistrust surrounds the Industrial Relations Bill 2009. There has been a significant shift in attitudes since that Bill was published and the resumption of the debate on it in this House last week. Much of that mistrust is based on the manner in which the Government is perceived to have rejected the proposals from the public sector unions in respect of proposed pay cuts for public sector workers and imposed measures which amount to a drastic reduction in wages across the public sector, including for the many public servants already on low wages.

I was surprised to hear when I met recently with the trade unions that 49% of public sector workers earn below the average industrial wage. These people have been severely hit by the measures pushed through by this Government. Suspicion has not been lessened by the Government's intention to amend the industrial relations legislation to allow employers renege on pay agreements on the basis of inability to pay. More important - this relates directly to the type of workers intended to be covered by the Employment Agency Regulation Bill 2009 - the amendments will allow employers to pay less than the statutory minimum wage and the minimum rates set in traditionally low wage sectors by employment regulation orders. It will also allow for the undermining of registered employment agreements in other sectors.

If this attack on the minimum wage and wage levels in general is successful it will lead to a complete reversal of measures designed to protect the lowest paid and most vulnerable workers in the economy. The Government's decision to press ahead with the amendments, with its attitude towards the public sector unions, signals it has abandoned social partnership and is now fully on board with the agenda of the employers' organisations, who are attempting to slash wages. This is the context in which we must view this Bill. It is the reason even its positive provisions are being viewed with suspicion.

The positive protections included in this Bill will be meaningless in a situation where agency workers are taken on by employers who have already been sanctioned to pay below the minimum wage. This sets up an extremely dangerous situation for the future, one in which we could and, indeed, will see, if the inability to pay amendments are carried, the creation of a new layer of low paid workers here from other countries while the current high level of unemployment for Irish workers remains as is or increases. If wage levels are driven down to where employers want them to be, domestic unemployment will increase as Irish workers are replaced by low paid agency workers from other countries. In that situation, none of the protections that exist will be worth the paper on which they are written, as we have already witnessed in terms of the manner in which the Government has turned its back on negotiations with the public sector unions and the manner in which some employers have already reneged on pay agreements that had the backing of the Labour Court. Currently, a worker is on hunger strike in Naas.

Denis Naughten (Roscommon-South Leitrim, Fine Gael)
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There are two people on hunger strike.

Martin Ferris (Kerry North, Sinn Fein)
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Yes, another worker joined the first hunger striker this morning. Non-union workers have replaced Irish unionised workers resulting in workers having to resort to going on hunger strike to obtain their rights, a practise likely to increase as time goes on.

It must also be borne in mind that rates of pay in many of the sectors likely to be targeted by employers are already low. According to Mandate, the average starting rate of pay for retail workers is €9.09 per hour, not much above the statutory minimum wage. This only increases to €13.57 per hour after ten years. It should be borne in mind too that these low rates of pay by and large remained static as retailers enjoyed large profits based on the consumer boom between 2001 and 2007, during which time the value of retail sales grew by 43%. This is exploitation of labour by greedy multinationals and others. The same applies to low paid workers in the hotel and catering sector. These workers, who saw no tangible increase in their living standards in the good years, are now expected to suffer wage cuts when times are not so good. Even companies that continue to do well are using the recession to undermine wages and conditions. For example, Boots cut wages despite its having made profits here of €20 million to March 2008. That is the model which other employers wish to follow and which they will be enabled to follow if the inability to pay clause in the Industrial Relations Bill 2009 is accepted. On that basis they will be able to bring in agency workers to work at below the statutory minimum and agreed rates for other sectors. It is necessary that this Bill be amended to safeguard against that possibility. The existing Registered Employment Agreements and Employment Regulation Orders need to be mandatory in respect of employment agencies and agency workers.

There is also a need for a section in the Bill which clarifies by whom an agency worker is actually employed otherwise, the provisions that purport to monitor the area and ensure that agency workers are protected by existing employment legislation and are not abused will be ineffective. An abuse that might arise is the employment of agency workers to replace workers engaged in industrial action. This needs to be explicitly outlawed in the Bill otherwise there will be huge division and anger within the workforce of this country. Another suggested amendment is that agencies place a bond to ensure that money received by an agency on behalf of workers is protected if the agency goes bankrupt.

The opportunity should have been availed of in this Bill to give effect to EU Directive 2008/104/EC which deals with temporary agency workers. The directive provides that agency workers are entitled to the same protections and rights as workers on permanent contracts. This State has sought to derogate from that on the basis that it creates a means of dealing with agency workers in agreement with the social partners. However, the qualification that this needs to be implemented with regard to current economic conditions and the need for a so-called flexible labour supply means that it is potentially open to the same opt-outs proposed in the Industrial Relations Bill. Clearly, employers want to be able to employ agency workers from overseas on lower wages and under weaker protections than those which currently apply to Irish workers.

Employers' spokespersons have made it clear that this is exactly what they want. They have obviously been successful in persuading their friends in Government and in the main Opposition party to support measures to undermine wages and conditions, thus facilitating a race to the bottom which will not only impoverish tens of thousands of Irish workers and their families but Irish society as a whole. The only beneficiaries will be low-paying employers who, having failed to pass on the benefits of the boom years, are now intent on surviving the recession at the expense of their employees.

It is essential that the amendments referred to are included in the Bill to ensure the proper protections are guaranteed for the agency workers themselves and to ensure that existing jobs, wages and conditions of employment are not undermined in their absence. It is also essential that, just as the employers, with the support of some of the parties here, are pursuing a strategy across the board in an attempt to drive down wages and weaken workers rights, those opposed to this here and in the trade unions likewise understand the need to challenge this on all levels, and in particular the attempt to link the undermining of the minimum wage to so-called labour flexibility which in reality means the freedom to recruit workers, including those on agency contracts from other countries, on much lower levels and under conditions that are unacceptable to Irish workers.

I hope the amendments I have suggested will be accepted in the interest of protecting workers in general, in the interest of protecting harmony within the workforce and in the interest of equality for agency workers and Irish workers.

Billy Kelleher (Cork North Central, Fianna Fail)
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I welcome the comments from Deputies this morning and in the previous debate we had three weeks ago. Based on those contributions, there is broad agreement for the thrust of the Bill. As it flows through this House and meanders through the parliamentary process we look forward to listening to the contributions of all Deputies on Committee and Report Stages and thereafter of the Members of the Upper House.

While Second Stage speeches sometimes move beyond the ambit of the Bill, some interesting points were made. We all agree that exploitation is an insidious evil before which we should put every roadblock to try to root it out. It is insidious on a number of fronts. It undermines a basic right of fair pay for fair work. More importantly, as Deputy Naughten pointed out, it undermines the fabric of society and inherently creates racial tensions when one sees exploitation, with workers brought in to displace local jobs. We need to be very conscious of that, particularly in the context of a downturn when we have rising unemployment. If one sees displacement of workers because of other workers being brought in who are exploited, it can have a very damaging effect on society and localities.

For that reason the broad thrust of all the legislation put through in the coming months, and legislation already introduced, is to ensure that there is a strong corpus of employment rights legislation. We have that in place. In fairness, it would be important for Deputy Ferris to look at the overall context of protections this and previous Governments have introduced, mainly in consultation with social partners. These are further commitments into which we have entered in the context of Towards 2016 to ensure that we have a strong body of employment rights legislation to protect workers.

The Employment Agency Regulation Bill is one plank. We also have the Industrial Relations (Amendment) Bill, to which the Deputy referred, and the Employment Law Compliance Bill. We also have the further issue of the transposition of the temporary agency workers directive itself. We hope that can be done through the social partners entering discussions and coming up with solutions to ensure we can transpose it in a meaningful way that adapts to the Irish labour market and understands our labour system and the primarily voluntarist approach taken here.

I do not believe the Government can be accused of reneging on commitments in the area of protecting workers' rights and ensuring that exploitation is rooted out. We put in place up to 90 labour inspectors. Deputy Naughten referred to it, and I know he referred to it on numerous occasions when I had responsibility for labour affairs. We reached 90, but because of the moratorium and other difficulties, it has dropped back somewhat. To put it into context, we had a shrinkage of the economy last year. There is less employment activity and labour inspectors are very vigilant. I often hear from all sides of the House condemnation of excessively enthusiastic labour inspectors. However, they are charged with a responsibility to enforce employment rights legislation, DRAs and EROs and to ensure employment legislation is complied with.

There has been broad support for the Bill and I welcome the contributions from the Deputies. Reference was made to the Lisbon treaty and whether we might have had success in the first referendum. Obviously, we would have had success in the first referendum if the debate had been based on the facts of the contents of the Lisbon treaty as opposed to much of the spurious debate that went on. There was the introduction of Laval, Viking and other areas, and the suggestion of the undermining of workers' rights.

Denis Naughten (Roscommon-South Leitrim, Fine Gael)
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The Minister of State's party was very good at that in referenda in the past.

Martin Ferris (Kerry North, Sinn Fein)
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We would have no Commissioner were it not for my party.

Billy Kelleher (Cork North Central, Fianna Fail)
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The contrary was the case. Nobody could accuse the EU of trying to undermine workers rights. A strong body of legislation here has come about sometimes as a result of prompting from the EU. In the area of health and safety as well as across the board we have seen that the European Union is committed to the protection of human rights. I think the Deputy will accept there is not much use having all those rights without any employment. It is important to get the balance right between rights and employment to ensure we are competitive so that the economy can grow and prosper, and create opportunity and employment. For that reason we need flexibility, which we have with the model we have with regard to the voluntarist approach and until recently a strong social partnership model that allowed us to sit down and discuss in a very mature fashion how to address workers' pay and conditions in addition to legislative support.

On the other side, we need to be competitive in a globalised economy where there is competition coming from all over the world and from within the EU itself. We need to strike that balance to ensure we have in place rights and protections, but we do not burden business to the point where it cannot compete and we lose jobs. Most Deputies would be conscious of that. Deputy Ferris might look over his speech again and realise that it contains some inaccuracies. If we tried to implement some of his proposals, it could have a major impact on businesses and be damaging to the creation of employment. I believe we are getting the balance right here and as the Bill goes through the parliamentary process we will be quite willing to listen to views from all sides of the House in the context of improving the legislation so that it comes out the other side with the goal of ensuring employment agencies are properly regulated.

While it is not true of Deputies, some commentators outside the House have been confused about the temporary agency workers directive and this legislation; they are fundamentally different. I remember taking part in Council meeting negotiations in Luxembourg that continued to 4 a.m. to get what we believed was a fair approach that respected the Irish position of voluntarism with social partnership. Many other countries have collective bargaining systems. They would have had derogations from the temporary agency workers directive. That would have put us at a disadvantage in the context of competition from within the EU. We held out because we believed in the social partnership model we had at the time, and which we hope we can bring back again if we can address some of the current difficulties. The overall approach of conducting our business through social partnership, through negotiations and through the voluntarist approach was respected. I believe we got a very fair deal and I hope the social partners will now begin the process of the transposition of that directive here. I urge them to start moving that process along because 2011 and 2012 are rapidly approaching. Deputy Ferris will be aware that we need to keep our eye on a few dates in the future.

Martin Ferris (Kerry North, Sinn Fein)
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I do not think the Minister of State is looking forward to it.

Billy Kelleher (Cork North Central, Fianna Fail)
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We shall see how it goes then, but we shall stay in here for as long as possible to ensure the policies we are pursuing-----

Martin Ferris (Kerry North, Sinn Fein)
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I like the way he says they will stay here as long as possible.

Billy Kelleher (Cork North Central, Fianna Fail)
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We owe it to the people to fulfil our mandate. The policies we are implementing need to continue in the current difficult circumstances. We would be reneging on our duties if we went earlier than that.

The code of conduct will be laid before the Houses of the Oireachtas. That should clarify the matter. It is a voluntarist code, but there is a statutory code of conduct as well. It is critically important to emphasise that there is nothing wrong with agency work. Agency work gives flexibility to employees and to business. Many people go to agencies to seek employment and it suits their particular needs. Not everyone wants to work five days a week, every week of the year. Some people for whatever reason, lifestyle choices etc., want flexibility, and an agency can provide this. On the other side of the equation, large-scale companies may have to shut down at times and bring in contractors to upgrade the facilities or whatever, and this is only short-term work. That suits those companies as well. This is the balance we are trying to protect. We do not want to interfere with the triangular relationship between agencies, employers and employees in user services, but want to ensure that the agencies are well-regulated, so that if difficulties arise we can pinpoint them and prosecute, as appropriate. If one looks at the indictable offences mentioned in the Bill, one sees that quite serious fines are being legislated for in this regard, as well as prison sentences. For all those reasons I believe this Bill is a very positive step.

Reference has been made to union recognition, which is a very important issue as well. The Industrial Relations Act 1997 worked very well in this regard until the Supreme Court decision. I believe we should go back to that, foment discussion and seek to repair that particular approach. Most people accept that it was fair and balanced. We have a voluntarist approach in this country where both sides of the industrial divide discuss in a calm and rational manner pay, working conditions and employee protection on the one hand as well as productivity issues on the other, as required by businesses. It is a two-way relationship, and the scales cannot be balanced too much in favour of one side or the other. I believe that rights without employment, however, are not much good to anyone. What is required is balance.

Reference was made to multinationals exploiting workers. I should like if the Deputy could bring such instances to my attention, because I find, by and large, that the multinationals in this country are very good payers and provide excellent conditions for their employees. I would genuinely urge him to bring these matters to the attention of NERA or elsewhere, if he has such concerns, but I hate those types of allegations being flung out in the Dáil here and being picked up. I believe that multinationals in general are good employers and they are enormously important for the economy. Some 100,000 people are employed in multinational companies in Ireland and they account for a significant proportion of the country's GDP. We must be conscious of their reputation as well.

I shall now try to address some of the issues raised by Deputies. In response to Deputy Costello as regards the issue of the temporary agency worker directive, the idea here was to encourage the EU to accept that we have a different approach to industrial relations in this country. Ireland was not stalling as regards the directive's implementation, simply because we were against it. We wanted to ensure we could get the flexibility that respects our industrial relations process. This meant, primarily, that social partners would be given the remit to decide on how the transposition might be achieved in accordance with industrial relations norms in this country. Other countries had collective bargaining in place and so had derogations from the temporary agency workers directive. That would have put the Irish economy at a grave competitive disadvantage, so we were conscious of this in the light of the need for both sides of industry to be actively involved.

Reference was made, too, to the need for the Government to engage with unions. It is critically important that people should understand this Government is open to discussions and dialogue all the time. In fact last year, the Taoiseach was castigated by Fine Gael for spending too long in discussions with the social partners.

Damien English (Meath West, Fine Gael)
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He was not taking a leading role in them, that is why.

Billy Kelleher (Cork North Central, Fianna Fail)
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About this time last year-----

Bernard Durkan (Kildare North, Fine Gael)
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He was going nowhere.

Brendan Howlin (Wexford, Labour)
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Allow the Minister of State to reply.

Damien English (Meath West, Fine Gael)
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There was no real agenda, that is why.

Bernard Durkan (Kildare North, Fine Gael)
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It was going nowhere.

Bernard Durkan (Kildare North, Fine Gael)
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The Minister of State was very good on the radio this morning, but he is not so good now.

Billy Kelleher (Cork North Central, Fianna Fail)
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It is important to look at the facts. We were castigated for entertaining the discussions for too long.

Damien English (Meath West, Fine Gael)
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They were getting nowhere. There is a difference.

Billy Kelleher (Cork North Central, Fianna Fail)
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Discussions can take time, particularly when they are very complex, involving decisions-----

Damien English (Meath West, Fine Gael)
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He was not taking a leadership role as the leader of the country. He was just following along, and that was getting us nowhere.

Billy Kelleher (Cork North Central, Fianna Fail)
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Discussions and partnership are about respecting everyone's view as opposed to the iron fist. We were trying to get consensus in dealing with the very difficult challenges facing the country. We were all aware of the pressures, with the enormous growing deficit and the world financial crisis feeding into grave instability in this country as well.

Bernard Durkan (Kildare North, Fine Gael)
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There was a bigger crisis being generated in this country, and the Minister of State knows that, too.

Billy Kelleher (Cork North Central, Fianna Fail)
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For that reason we wanted to give as much time to all the parties involved in social partnership to come up with solutions that might address all the difficulties that faced Ireland, not only in the context of-----

Damien English (Meath West, Fine Gael)
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When does the Minister of State intend to act on them?

Billy Kelleher (Cork North Central, Fianna Fail)
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-----the budget deficit, but also in regard to the difficulties we were facing with the financial crisis as well. These issues were all highly pressurised.

Bernard Durkan (Kildare North, Fine Gael)
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Many people are worried about the Government in that regard.

Billy Kelleher (Cork North Central, Fianna Fail)
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I remind Deputies that some of the international commentary since this time last year has praised the decisions made by the Government in this regard.

Bernard Durkan (Kildare North, Fine Gael)
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Do not go there. The Minister of State is a very nice guy, and I am very fond of him, but he should not-----

Brendan Howlin (Wexford, Labour)
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Deputy Durkan should allow the Minister of State to make his contribution without being shouted down. Deputies from his side of the House were afforded that opportunity.

Bernard Durkan (Kildare North, Fine Gael)
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I do not want him to be embarrassing himself.

Billy Kelleher (Cork North Central, Fianna Fail)
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I am trying to be helpful to the Deputies opposite, but it is highly significant that the Government's initiatives have been acknowledged internationally, and this is enormously significant. There was a time when------

Damien English (Meath West, Fine Gael)
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We have not got all our bonds in, is that not right?

Billy Kelleher (Cork North Central, Fianna Fail)
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-----there was a great deal of innuendo around the world concerning the Irish economy-----

Bernard Durkan (Kildare North, Fine Gael)
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That is why the Government did not get paid by the bank. It got shares instead.

Billy Kelleher (Cork North Central, Fianna Fail)
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-----and there was a feeding frenzy which was undermining the economy. In fairness, most people in this House were responsible, but----

Bernard Durkan (Kildare North, Fine Gael)
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There is a sinking feeling out there now.

Billy Kelleher (Cork North Central, Fianna Fail)
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------much of the commentary outside the House had an enormously damaging impact on the reputation of the economy. Happily and thankfully----

Bernard Durkan (Kildare North, Fine Gael)
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The only thing that damaged the economy was the Government over there and the Minister of State knows that as well as I do.

Billy Kelleher (Cork North Central, Fianna Fail)
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------as regards Ireland's reputation, we have turned the corner and it has been re-established. We must now ensure we continue with the policies that are accepted as necessary for getting back to a situation where the budget deficit is reined in, we bring competitiveness back into the economy and start to create employment opportunities again.

Bernard Durkan (Kildare North, Fine Gael)
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As John Wayne said, "That'll be the day".

Billy Kelleher (Cork North Central, Fianna Fail)
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That is easier said than done, however. The overall situation as regards the Bill is that we cannot just take this in isolation. It is part of an overall corpus of legislation that is coming through the process. In the context of this particular Bill, while it took some time, it is important to realise that it required much discussion-----

Damien English (Meath West, Fine Gael)
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It is a big Bill all right, is it not? Look at the size of it, it is massive. It took seven or eight years to deliver.

Billy Kelleher (Cork North Central, Fianna Fail)
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Some day Deputy English could be on this side of the House and he might reflect, in the event, that those words of wisdom from Minister of State, Deputy Kelleher, were much appreciated.

Damien English (Meath West, Fine Gael)
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If so, we shall take some action.

Brendan Howlin (Wexford, Labour)
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Will the Deputy please allow the Minister of State to bring his remarks to a conclusion?

Billy Kelleher (Cork North Central, Fianna Fail)
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We had to have discussions with the European Commission as well because of the fact-----

Damien English (Meath West, Fine Gael)
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This legislation was initiated seven or eight years ago, in case the Minister of State forgets. We are the last to contribute to it.

Brendan Howlin (Wexford, Labour)
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It is not appropriate for Deputies to shout back. This is not a pigeon fanciers' club.

Billy Kelleher (Cork North Central, Fianna Fail)
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-----there is a services directive, inter alia, as well as the Treaty of Rome. We had to get some guidance to ensure we were not in conflict with EU directives as regards the free movement of goods and services etc., so it took some time to get clarity on those issues. However, we believe a Bill is in place that is not in conflict with the EU, which at the same time will provide strong protections and prosecutorial powers to agencies where breaches of the legislation arise. We believe this Bill will ensure our legislation is not in conflict with the EU and will afford inherently strong protections and prosecutorial powers to agencies if there are breaches of the legislation.

I thank everyone involved, including the officials for their work in ensuring the Bill has reached Second Stage in the Dáil. I refer to some of the issues raised by individual Deputies. Deputy Penrose raised concerns with regard to REAs, registered employment agreements, and EROs, employment regulation orders and sought clarity on this issue. This Bill will not provide that clarity, but that will come from the Industrial Relations (Amendment) Bill, which is in gestation and under consideration. We should keep the debate in context and factual. This is critically important. No Government seeks a race to the bottom in the area of wages. The Government introduced the National Minimum Wage Act 2000 to ensure we have one of the highest minimum wages in the world, currently at €8.65 per hour.

Bernard Durkan (Kildare North, Fine Gael)
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Why was that?

Billy Kelleher (Cork North Central, Fianna Fail)
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Reference was made-----

Bernard Durkan (Kildare North, Fine Gael)
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It was because no one could buy a house ever again.

Brendan Howlin (Wexford, Labour)
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Deputy, please.

Bernard Durkan (Kildare North, Fine Gael)
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I apologise a Leas-Cheann Comhairle. The Minister of State was upsetting me.

Billy Kelleher (Cork North Central, Fianna Fail)
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I refer to the remarks made by Deputy Ferris. When he leaves the House he will be clear about the Government's view of protecting workers' pay and conditions. He referred to the inability to pay clause in the area of EROs and REAs. There is already an inability to pay clause in the minimum wage. It has not been invoked or used and we are hopeful that will always be the case and that the economy could support a minimum wage of €8.65.

Martin Ferris (Kerry North, Sinn Fein)
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The minimum wage is spent in the most expensive economy in Europe.

Billy Kelleher (Cork North Central, Fianna Fail)
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We wish to secure an economy that can support that wage level. Such decisions are made elsewhere but this is my view and it is also a wider societal issue. I refer to the broader issue which is important. It appears there is a move to push for a race to the bottom but nothing could be further from the truth. The idea of an inability to pay clause is that in the event of a business or company which finds itself-----

Bernard Durkan (Kildare North, Fine Gael)
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We have won the race already.

Billy Kelleher (Cork North Central, Fianna Fail)
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-----under pressure for a short duration, a mechanism is in place whereby in consultation and discussion with all interested parties, an arrangement may be reached for a period to allow those concerned to get over a hump or difficulty. That is the only purpose of the consideration of an inability to pay clause. People should focus on what it is trying to achieve, that is, to protect employers and employees and to ensure opportunities still exist rather than to allow a business to fold because it is going through a very short period of difficulty. We are all aware it is easier to protect and retain jobs than to create new ones, especially in a downturn. For this reason people should reflect on the matter and not try to inflame the debate to the point where people are being accused of a race to the bottom. This Government has a good track record in creating employment and protecting the rights of employees over the years and we should reflect on this.

I thank the Deputies for the broad support for the legislation. It is part of a plank of legislation that makes up the commitments of Towards 2016. We wish to ensure the legislation goes through the Houses and we welcome the broad support of everyone. We wish to ensure it has a smooth passage and that it comes out the other side with the support of all political parties. I refer to the difficulties with unions at present. The Government's door is always open for discussions, even if Fine Gael accuses us of discussing too much with the unions, we are available-----

Damien English (Meath West, Fine Gael)
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I do not recall us saying that at any time.

Bernard Durkan (Kildare North, Fine Gael)
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The Minister of State brings a tear to my eye. It is one of the many tears he has brought to my eye in recent times.

Billy Kelleher (Cork North Central, Fianna Fail)
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I commend the Bill to the House.