Colm Burke (Cork North Central, Fine Gael)
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I ask the Minister to give serious consideration to changing the employment status or classification of home tutors governed by the home tuition grant scheme from self-employed to employee. These tutors are essentially employees of the Department of Education but their current PRSI status puts them at a serious disadvantage because of their lack of eligibility for pensionable PRSI contributions. I ask the Minister to give serious consideration to this proposal.

This issue is quite serious because those who are providing home tuition on a full-time basis cannot make class A contributions because they are in PRSI class S. They cannot claim expenses and yet they are regarded as self-employed. They are also restricted from paying into a private pension fund. They are at a huge disadvantage. They are employed to provide home tuition and the vast majority are working full time providing this service. The Department of Education is paying them but they are not regarded as employees.

We had this debate in recent weeks where people from RTÉ, for instance, who were regarded as having individual contracts have now been brought in as employees. Home tuition is another matter the Department has to give serious consideration to. On the one hand, home tutors are treated as self-employed but they do not have the same advantages of being self-employed because they cannot pay claim expenses or pay into a pension fund. On the other hand, they are not entitled to sick pay or holiday pay and, therefore, they are working at a huge disadvantage. At the same time, they are providing a good service to young people who are not able to fit into the school structure or who are finding it difficult to work within it.

Seán Fleming (Laois-Offaly, Fianna Fail)
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I thank the Deputy for raising this issue in the House because it is one that affects a number of people who are involved in home tuition. It is probably a subtle issue that many people would not have been aware of and I can understand that it is a bit confusing. Nevertheless, there are clear procedures and rules in place but I understand people will find them a little bit more complicated than the normal situation.

I am advised by the Revenue Commissioners that, from a Revenue perspective, the home tutors referred to by the Deputy are engaged under a contract of service. This means they are employees but the point is that they are not employees of the Department. They are engaged by the parents subject to satisfying criteria specified by the Department of Education. Prior to September 2015, the home tutors were paid by the parents from grants paid to them by the Department of Education.

As a consequence of a Revenue audit, the Department of Education agreed to operate the PAYE system on payments to the home tutors. This facilitates ease of administration as the payments originate from the Department. It also avoids placing an obligation to register as an employer and administer the PAYE system on each individual parent. It was done on an administrative basis for convenience and to assist everybody involved but it did not change the employment status of home tutors.

It should be borne in mind that PAYE is not a tax in its own right. PAYE is a withholding mechanism. Employers are obliged to deduct income tax from emoluments they pay to employees. Employees remain liable to income tax and the universal social charge, USC, on those emoluments. Application of PAYE does not confer an employment right on a worker. However, I understand that when many people get a pay slip and see who the money is coming from they would believe they are employed by them. However, even though the application of PAYE is made by the Department, it does not confer employment rights.

Matters of PRSI status and employment classification are determined by the scope section in the Department of Social Protection and the Workplace Relations Commission, WRC. I am advised that the scope section in the Department of Social Protection has examined the status of home tutors on a number of occasions and has determined that they are engaged under a contract for services, or self-employed, and that the appropriate PRSI class is class S. The Deputy can appreciate that in my earlier comment I stated that they are deemed to be employees from the Revenue point of view but the Department of Social Protection considers them to be self-employed. There is an unresolved issue here.

On eligibility for PRSI contributions, I am advised by the Department of Social Protection that self-employed workers who earn more than €5,000 in a contribution year are liable to pay social insurance contributions at a class S rate of 4%, subject to a minimum payment of €500. Such contributors, once they satisfy the scheme-specific criteria, in addition to having the required number of social insurance contributions, are covered for a wide range of social insurance benefits. This includes: the State contributory pension; widow's, widower's or surviving civil partner's contributory pension; guardian's contributory payment; maternity, adoptive and paternity benefits; treatment benefits; invalidity pension; partial capacity benefit if in receipt of invalidity pension; jobseeker's benefit for self-employed persons; and parent's benefit.

The following point is important. The Revenue advises that it is available to engage with officials in the Department of Social Protection and the WRC to discuss any determination that might arise under social welfare and employment legislation. The Department of Social Protection is probably the key Department dealing with this issue. The Revenue's involvement is straightforward from an administrative point of view. The Department and the Revenue Commissioners are available to discuss this with the Department of Social Protection and the WRC to try to resolve this matter.

Colm Burke (Cork North Central, Fine Gael)
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It does not resolve the issue. The Department is paying for this service. I know it is not regarded as the employer on paper but in real terms it is. This is the same debate that has gone on in respect of many organisations in recent months, in that people who are deemed to be self-employed under contracts are, in fact, technically employees. It is time this issue was resolved.

The Minister of State talked about numbers. My understanding is that there are up to 500 people in Cork alone providing this service. I am not sure what the number for the entire country is but we should try to find out as it would be interesting. We should also make sure they get the same recognition as teachers in our primary and secondary schools because they are providing that same level of education, but in a different setting. Why should they be regarded differently just because they are providing the same education but in a different setting? In many cases it is far more challenging so there has to be a huge and genuine commitment by them to make sure the pupils they are dealing with get the best quality education at all times.

I ask that the Department work with the Department of Social Protection and any other Department to make sure we do not have people who are technically employees of a Department who are being treating as self-employed. We criticise that in the private sector but this is the public sector adopting the exact same position. It is time that was reviewed.

Seán Fleming (Laois-Offaly, Fianna Fail)
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I appreciate the Deputy's point of view on this. People are being paid by the Department and they feel that as such that they are employees of it. I would highlight that the parents come into this. They are the people who bring home tutors into their homes so that they can provide those tuition services to children in the household. The parents have a pivotal role and it is important that is not omitted because it is through the parents that this scheme happens.

That said, I accept the confusion between the Department of Social Protection and the WRC, if it was to adjudicate on this. There are many classifications where determinations have to be made on whether a person is self-employed or a contractor working for a business. The question is whether the person is in effect and in reality an employee. That determination has yet to be made and it is important that this case is put. I would recommend that the Department of Social Protection work on this. Revenue is available.

During the recent pandemic, the pandemic unemployment payment, which was available to employees and self-employed persons, was available to people carrying out home tuition. There was also an enhanced illness benefit available to employees and self-employed persons up to a maximum of two weeks when they were medically required to self-isolate during Covid-19.

The matters of PRSI status and employment classification are for the scope section in the Department of Social Protection. I suggest the Deputy table a Topical Issue matter for that Department to get the views from the Department of Finance and the Department of Social Protection on the Revenue's position on the record. It might be helpful to then bring the matter to the WRC.

Self-employed workers who pay social insurance contributions, or class S contributions, are covered for a wide range of social benefits, which I mentioned. I understand the difficulties with the lack of sick pay and holiday pay and not being able to contribute to a pension fund.

Further discussion is required on this matter.