John Brady (Wicklow, Sinn Fein)
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37. To ask the Minister for Employment Affairs and Social Protection the steps she is taking to address the growing problem of bogus self-employment; if her Department has examined the amount of PRSI being lost due to same; and if she will make a statement on the matter. [50581/17]

John Brady (Wicklow, Sinn Fein)
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I wish to ask the Minister what actions are being taken by her Department to tackle bogus self-employment, which is rife within the construction and media sectors. The result is a loss of PRSI contributions and a loss to the Exchequer in general. There are also major implications for workers' rights and entitlements.

Regina Doherty (Meath East, Fine Gael)
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Deputy Brady is aware that this is a particular bugbear of mine. Bogus self-employment arises when an employer wrongly treats a worker as an independent contractor in order to avoid paying tax and social insurance contributions. There are no official data on the extent of bogus self-employment but I wish there was. It is not clear whether the problem is growing but, anecdotally, we are all aware that the norms within working environments are changing.

The recent data from the quarterly national household survey records 312,000 individuals as self-employed in 2017, which accounts for 15% of the overall number of people in employment. The survey does not show any significant increase in the numbers claiming to be self-employed, nor does it show any significant disparity between Ireland and other European countries. It is a case that we all have a problem and that we have had it for a long time and have just not addressed it. I hope the House collectively wants to fix that.

Social welfare inspectors inspect a wide range of businesses as part of the ongoing compliance operations. Inspections are conducted jointly between the Revenue Commissioners and the Workplace Relations Commission. Where evidence of non-compliance is detected, the matter is pursued. Officials also investigate specific claims brought to the Department's attention by either individuals or organisations. The relevant section in the Department is the scope insurability section. The section determines the employment status of individuals at their request or on the request of a company. Where a misclassification of a worker as self-employed is detected, the correct status and class are determined and social insurance arrears are collected. Under the Social Welfare Consolidation Act, there are specific offences concerning employment contributions. On conviction, fines and-or imprisonment can ultimately imposed.

Additional information not given on the floor of the House

Any worker who has concerns about his or her employment and PRSI status should contact my Department and the matter will be investigated.

The classification of a worker for PRSI purposes is increasingly complicated by what is termed "disguised employment". The latter involves intermediary employment structures and certain self-employment arrangements. My Department is concerned that such mechanisms are being used to reduce the amount of PRSI and tax being paid, with a subsequent loss to the Exchequer and the Social Insurance Fund. An interdepartmental working group, comprising officials from my Department, the Department of Finance and the Revenue Commissioners has completed a report on this issue. The Minister for Finance and I are considering the report with a view to its publication in the near future.

John Brady (Wicklow, Sinn Fein)
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The Minister indicated that 312,000 people are registered as self-employed within the State. There is not just anecdotal evidence of bogus self-employment in the construction sector, it is also a feature in the information technology, IT, and media sectors. In January 2016, the then Ministers for Social Protection and Finance launched a joint consultation on the use of intermediary-type structures and self-employment arrangements. A public consultation process was initiated and a total of 23 submissions were made to it. Last month, I tabled a parliamentary question to the Minister and was informed that the two Departments are working on the issue and that the submissions are still being assessed. The public consultation took place 20 months ago. We need action. What is the status of the report and when will it be published? The issue is very serious. I will refer to other areas in a moment but I would first like the Minister to respond.

Regina Doherty (Meath East, Fine Gael)
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We are not still considering the 23 submissions. They have been considered. My real concern is that there were only 23 in The report is being considered by me and the Minister for Finance. I expect to be able to publish it in the next couple of weeks with a view to determining actions we will take at the beginning of next year to address the issue.

My concerns are twofold. It is not my job to collect social insurance contributions but it is my job to spend the money from those contributions.

If I had what we all perceive to be the shortfall of employers' PRSI to spend, we could have a really different conversation in this House on how to spend it. Equally important to me are employment rights, which is my responsibility for those people who find themselves in positions where they are forced into self-employment, as opposed to real employment. I am determined to fix that early next year. If there is a bonus of getting a couple of million euro or a couple of hundred million euro extra in social insurance contributions, I will enjoy having that conversation at the committee on how to spend it.

John Brady (Wicklow, Sinn Fein)
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A couple of weeks ago before the social protection committee, the Minister said she hoped to bring this report to a sub-committee of the Cabinet. Has that happened? We know there is much money lost to Revenue and through potential social insurance contributions. The overall loss to the Exchequer could be €80 million.

The Minister also touched on inspections being carried out by the Department but I ask for specifics on that. I am not sure what exactly officials or inspectors from the Department of Employment Affairs and Social Protection are looking for when they go into check this type of employment, whether it is on a building site or elsewhere. Perhaps in the first instance they check if somebody is in receipt of a jobseeker's payment and working as well. That does not cut to the chase. There are people who are forced into self-employment who are losing out on their entitlements as an employee. For example, they should be entitled to sick pay, holiday pay and all the other entitlements that go along with that. It is a serious problem not just in the construction industry, as I stated, but in other areas.

How many of these inspections have been carried out and in what type of employment? Have they just targeted the construction industry? Have they gone to places such as RTÉ, for example, and what exactly are the inspectors looking for? I would like more specifics on the inspectors.

Regina Doherty (Meath East, Fine Gael)
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The Deputy might be confused as there are many different inspectors and sections in our Department. The inspectors who look after this have nothing to do with trying to figure out if a person is on a jobseeker's payment. That is somebody else's job. The inspectors involved with assessing insurability contributions go into a job and see that a person is in class S when he or she should be in class K. They will reflect that and get it changed. It is about working with both the employer and employee to ensure the right classification of a social insurance contribution is made on behalf of employees, and if it is not, to back-track it and ensure dues to the State are paid.

There is also the scope section within the Department of Employment Affairs and Social Protection. Any of the people suggested by the Deputy who may find themselves in positions where they know they are not really self-employed can make a complaint or inquiry to the Department any day of the week and we will follow it up. The problem is these people do not do so. They do it in small numbers. My belief is many of the 312,000 people perhaps do not know about the scope unit and we will address that in the new year.

I am not sure I said the report was going to a sub-committee of the Cabinet. That might have been the other report on the pensions anomaly. I have so many reports coming out of my ears at this stage, it is not funny. This report is not going to a sub-committee of the Cabinet but it is going to Cabinet in the next couple of weeks. The only reason I am holding off is because I am not prepared to send a report to the Cabinet without clear, precise, specific recommendations as to how we can address the matter. That is what I am considering now with the Minister for Finance.

John Brady (Wicklow, Sinn Fein)
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Will that be before Christmas?

Regina Doherty (Meath East, Fine Gael)
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Absolutely.