Dáil debates

Thursday, 15 September 2022

Ceisteanna Eile - Other Questions

Employment Rights

10:00 am

Photo of Louise O'ReillyLouise O'Reilly (Dublin Fingal, Sinn Fein)
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9. To ask the Minister for Enterprise, Trade and Employment the measures his Department is taking to uncover, to tackle and to reduce bogus self-employment, especially in State-funded agencies or where public moneys are being spent, in light of a recent judgment of the Workplace Relations Commission against a company (details supplied); and if he will make a statement on the matter. [43743/22]

Photo of Louise O'ReillyLouise O'Reilly (Dublin Fingal, Sinn Fein)
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I have raised this issue with the Tánaiste in different guises on a number of occasions. On the one hand, when there is an industrial dispute, he and others in government will advise people to use the third-party machinery of the State, and that is entirely appropriate. On the other hand, however, we have agencies funded by his Department that then ignore these rulings in some instances. This case relates to bogus self-employment. It relates specifically to Design & Crafts Council Ireland - this has been reported in the newspaper - and a judgment, a ruling, made against it. I want an update from the Tánaiste, if I could, in light of this judgment specifically, on what is being done to tackle the scourge of bogus self-employment.

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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I thank Deputy O'Reilly for raising this issue.

It is important to ensure that workers are correctly classified in a way that matches the reality of the relationship between the worker and the business. Therefore, we take very seriously any bogus employment. The Tánaiste is very clear on that and has set up a working group on the matter.

In Ireland, mechanisms exist for the determination of the employment status of individuals or groups. Where an issue arises in respect of the employment status of an individual, cases are forwarded to the Revenue Commissioners and-or the scope section of the Department of Social Protection for investigation, either solely by the recipient or jointly with the labour inspectorate of the Workplace Relations Commission. The WRC may also determine employment status as a preliminary issue at an adjudication hearing dealing with an employment rights dispute.

In July 2021 a revised code of practice on determining employment status was published by the Minister for Social Protection. This code is the key guidance document for employers and workers and others on deciding the employment status of a worker. The code was revised to take account of newer labour market developments, including platform work.

The misclassification of workers as self-employed when their terms and conditions mean that they are, in reality, employees is a matter of concern to us. However, in the changing world of work, correct classification of the relationship between employers and workers is not always a straightforward matter, and each case must be judged on its individual circumstances. That is the system we have operated here very successfully for a long number of years.

Regardless of the complexities in this area, it is important that false self-employment is tackled wherever it occurs, and we are very clear on that. To that end, the Tánaiste has requested our Department to convene a working group consisting of officials from the Department, the Department of Social Protection and the Revenue Commissioners as well as representatives from ICTU, IBEC, the Construction Industry Federation of Ireland and ISME to examine closely this issue. I chair that group and we have met on a number of occasions.

Ireland has a broad suite of employment rights legislation. All businesses including those in receipt of public funds - we are very clear on this - are obliged to adhere to the law of the land, including those obligations arising under employment rights legislation. The WRC is the organisation within the State which is mandated to secure compliance with employment rights legislation and it does a good job in doing so.

Deputy O'Reilly raised a specific issue. I cannot comment on any individual case-----

Photo of Louise O'ReillyLouise O'Reilly (Dublin Fingal, Sinn Fein)
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That is okay.

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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-----but we are absolutely clear that, regardless of whether public money is involved or not, the rules of the State must be followed.

Photo of Louise O'ReillyLouise O'Reilly (Dublin Fingal, Sinn Fein)
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The Minister of State referred to the changing world of work as if it is something that has just recently happened. Of course, it has not. I was trying to work it out there, but I think it is about 17 years since the first time I heard the phrase "no mutuality of obligation" in a Labour Court recommendation. The Minister of State will know what that phrase means. It has been knocking around for a very long time. For years people thought that the bogus self-employment issue was something that existed only in certain parts of the economy. It is now invading every part of the economy.

What the WRC found in the case to which I referred was that the employer had been evading their legal responsibilities under employment law, namely, that they had sought to force a worker into bogus self-employment in respect of her job as an instructor. That just denies her permanent employment. It is not just a case of not getting a contract; the worker does not have access to sick leave, does not have access to a pension and does not have access to paid time off. It is a really serious issue. The Minister of State will be aware of this.

I would appreciate an update on the consultative group and the work it is doing. It is good that it meets but we want to hear what is actually coming out of that group.

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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I have no doubt but that the Deputy is well plugged into that group. It is representative of all parts of society. It is important we continue to focus on the area to see if we can enhance and strengthen our legislation and our regime. Part of the work of that group over recent months has been to assess the situation at the moment and the numbers that we believe are in this sector and to see if Revenue and the Department of Social Protection have the right staff and the extra staff they need to be able to deal with the current situation. They say they do.

There are delays in the system when a case goes into a review, an appeal or suchlike, which can be very lengthy. Most cases are now dealt with in, I think, less than six weeks. That is the initial judgment. It is always an individual assessment of every individual case. The working group is trying to see if we can add to that and make it better.

In fairness, the initiatives in this area have been updated over many years at different times to reflect changes in work. The big change at the moment - it has been going on for the past couple of years - is platform work. There are changes afoot at EU level as well. We will take all that on board with the new EU directive and bring it through that working group and back, with a recommendation to the Tánaiste through the Labour Employer Economic Forum, LEEF, as well. It is important that we will act on that if need be. A part of that is gathering the evidence and seeing what sectors we can focus on. There are often phrases used like those Deputy O'Reilly has just used that this is a major problem. The research does not always show that, but wherever the issue arises we want to stamp it out. The Tánaiste is very clear on this. It denies people their rights when it comes to supports from the Department of Social Protection or any other bodies. In addition, it causes loss of revenue to the State.

Photo of Louise O'ReillyLouise O'Reilly (Dublin Fingal, Sinn Fein)
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It is a serious problem, a growing problem and one that needs to be tackled absolutely head-on. As I said, there was a time when people thought it was a niche issue. It is not. It is in the gig economy, IT, construction, universities, journalism and broadcasting. We know that it is happening; what we do not know is what the Government is actually going to do about it. The workers themselves miss out on so much when they are misclassified. I am talking about things like maternity benefit and other stuff that is really important. Workers are being excluded from that. They are coming into work. There is a mutuality of obligation that has to be established, but even when it is established, and if we take the case I have outlined, which has now been appealed by the employer, the employer now, presumably a State-funded agency, is spending the State's money to fight one of its workers because that worker has been forced into bogus self-employment. As part of the group, the Department should look at that and at how much money is spent by the State fighting workers who have an entitlement through the machinery of the State. That has to be looked at, but where the State is facilitating it, it is especially egregious.

Photo of Damien EnglishDamien English (Meath West, Fine Gael)
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To be very clear, the State does not facilitate it. The State expects anybody who is in employment to have the full protection of our employment legislation, and we are very clear on that. There are two agencies, Revenue and the Department of Social Protection, that do a well-recognised good job in this area. Our regime in Ireland is well recognised for protection of employees. It is something we are very proud of and put the resources into, and we will strengthen that.

We have also extended a lot of the benefits to self-employed people through social protection, and rightly so, because we have seen how they were left behind at the last financial recession, so we have made sure to extend that. That is something we have worked very clearly on and it is an agenda the Tánaiste has driven through the Department of Social Protection previously and now in our Department as well. That is very clear. The State will never support bogus employment or self-employment or anyone being forced into it. That is why this working group is carrying out a review to see if we can enhance that. We have sat down with Revenue and the Department of Social Protection to see if they need more resources to tackle the cases that are there, but we are very clear on this. As part of the work, we will end up with a much stronger communications campaign. There are certain key areas Deputy O'Reilly and others have identified, as the Government has as well, and there are certain areas that need to be addressed. We will deal with them. It is not the case, however, that we are sitting back and doing nothing. The legislation is there already, and we want to be very clear on that.

Questions Nos. 10 and 11 taken with Question No. 5.

10:10 am

Photo of Louise O'ReillyLouise O'Reilly (Dublin Fingal, Sinn Fein)
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Question No. 11 is a simple one and I am conscious this was discussed earlier. I refer to an earlier comment made by the Tánaiste in which he said that viable but vulnerable businesses need to be prevented from failing. I understand this issue was discussed already. I ask this question on behalf of Deputy Gould.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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Was it taken?

Photo of Louise O'ReillyLouise O'Reilly (Dublin Fingal, Sinn Fein)
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Yes, it was. I was substituting for Deputy Gould and was not included in the grouping, which is why I am asking it now.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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It was grouped. The Deputy should have come in at that time.

Photo of Louise O'ReillyLouise O'Reilly (Dublin Fingal, Sinn Fein)
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I was not called and I did alert the Leas-Cheann Comhairle to it.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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Actually, the Deputy is down on the list. I am sorry about that.

Photo of Louise O'ReillyLouise O'Reilly (Dublin Fingal, Sinn Fein)
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If the Tánaiste and the Minister of State are agreeable, we could cut the time for the question. My question is fairly straightforward.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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My instructions were that Deputy O'Reilly was down for this question and that it was grouped. I should have pointed that out to the Deputy.

Photo of Louise O'ReillyLouise O'Reilly (Dublin Fingal, Sinn Fein)
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I did approach the Leas-Cheann Comhairle because I was not certain and just wanted to be sure.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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I said I was aware you were taking the question but I did not see the grouping. Anyway, we will let you go ahead.

Photo of Louise O'ReillyLouise O'Reilly (Dublin Fingal, Sinn Fein)
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I will be quick because I know Deputy Ó Ríordáin has a question.

Photo of Catherine ConnollyCatherine Connolly (Galway West, Independent)
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There is time for Deputy Ó Ríordáin.

Photo of Louise O'ReillyLouise O'Reilly (Dublin Fingal, Sinn Fein)
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The question relates to the supports currently in place for businesses. However, I want to ask about the Tánaiste's remarks, that he wants to prevent viable but vulnerable business from failing. How will he identify those businesses and how will he ensure the supports get to the business that are struggling with their energy costs?

Photo of Leo VaradkarLeo Varadkar (Dublin West, Fine Gael)
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"Viable-vulnerable" is a commonly used term when it comes to the various schemes we have. It is designed to ensure we do not provide taxpayers' money to businesses that we know will fail, regardless of what support they receive. We take a liberal approach, which sometimes involves supporting businesses that cannot succeed, but we err on the side of supporting a business or protecting jobs any time we can. For example, we provided the sustaining enterprise fund during the pandemic. We will have something similar for the energy crisis. We would expect businesses receiving large amounts of taxpayers' money to present a plan to show how they will survive, bounce back and reduce their energy costs if they can. That does not apply to every scheme. For example, in the commercial rates waiver we did not ask businesses to prove whether they were viable, but when it comes to other schemes we will. That is for a very good reason; to make sure we do not give hundreds of thousands, or even millions, of taxpayers' money to a company that does not have a realistic plan.

Photo of Louise O'ReillyLouise O'Reilly (Dublin Fingal, Sinn Fein)
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When the provision of this money is eventually announced, the Government should not give it to companies also that are viable. There was an issue during the pandemic when companies were on the one hand in receipt of State aid and on the other hand paying massive dividends to their shareholders, and that is not acceptable.

The Tánaiste referred to the need for businesses to reduce their energy costs. I am aware of a hotel which used to have a monthly energy bill of €21,000. That has now risen to €71,000. You can bet your bottom dollar that the people in that hotel are doing everything they can. Growers in north County Dublin have no choice but to use gas to keep their tunnels warm. They are doing everything they can to cut their energy use but they are energy-intensive companies and are worried their businesses will fail. What they want to hear from the Tánaiste is that the money will be directed directly to them, that viable businesses will be kept afloat and that money will not be funnelled into businesses that will come through this unscathed.

Photo of Leo VaradkarLeo Varadkar (Dublin West, Fine Gael)
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Those are exactly the kinds of things we have to take into account when it comes to any scheme, for example, a clawback mechanism to recover money from businesses that received it but did not need it in the end. Many companies paid back money they received through the employment wage subsidy scheme. I am glad we gave it to them because at the time it looked as though they might not succeed. They were able to keep on their staff and make profits during the pandemic, and they gave the money back. It is important that we have clawback arrangements in that regard.

I appreciate that businesses are facing huge energy costs. Two days would not pass that I do not meet someone in business who shows me their bill and tells me all the efforts they have made to reduce their energy costs and, notwithstanding that, the bill is triple what it was only a few months ago. We want to help businesses to move towards more modern ways of providing heat and light, such as using LED lights which cost a lot less. I visited the Iveagh Garden Hotel on Harcourt Street not too long ago where they have a heat pump. It is a massive thing in the basement of an old building. The hotel can have much lower energy costs than the vast majority of hotels that traditionally rely on gas and electricity. However, I understand one cannot install a heat pump in a week or two, or even a few months. We have to help now but also help in the long term.

Photo of Louise O'ReillyLouise O'Reilly (Dublin Fingal, Sinn Fein)
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That is very welcome. The Tánaiste is right; they have to be helped now. The longer-term solutions can wait. What businesses want to hear and what I want to hear from the Tánaiste is what that will look like because there is so much uncertainty. There are things far beyond the control of any person in the Chamber and we fully accept and appreciate that. Notwithstanding that, as much certainty as can be given should be given. We hope when the schemes are announced they will be simple and easy to access.

I am sure the Tánaiste does not mean this when talking about helping people to reduce their energy costs. I have spoken to business owners in my community and beyond who say they are doing absolutely everything. If there is something the Tánaiste believes can be done that those businesses are not doing, perhaps he should share that with them sooner rather than later. He should accept it is part of a longer term solution and that a short-term solution will be needed.

Photo of Leo VaradkarLeo Varadkar (Dublin West, Fine Gael)
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The way we do that is by assisting businesses to get professional expertise in this area. Long before the current energy crisis, we provided about 20 different schemes through my Department and its agencies, and through the Sustainable Energy Authority of Ireland, SEAI, not just to help businesses reduce their carbon footprint and invest in modern energy systems but also to enable them to carry out an energy audit. I have met many businesses that have availed of those vouchers that have had the audit done. Even though they are progressive businesses that have done a lot to reduce their energy costs, they often find out things they had not considered. That is a programme put in place by the Government. It is not about us hectoring them and telling them that they need to reduce their energy costs. It is about us providing them with vouchers, support, and professional advice that shows them how they can reduce their energy costs, which is more relevant now more than ever.