Feargal Quinn (Independent)

I welcome the Minister of State, of whom we have seen a lot lately. He is a good listener, as we have learned during the passage of recent legislation. I am also a good listener but was unaware of the story the Minister of State told regarding the Latvian workers on Colt Island, off Skerries. I grew up in that part of the world. In light of the Latvian workers' experience, I understand why there are calls for legislation. However, I am a great believer that the less legislation we introduce, the better. The Minister of State is probably of the same opinion.

If it is possible to find a solution to a problem that does not involve enforcement legislation, it is all the better. People, particularly employers, do things because they are good for business. About ten years ago, a man called John approached me and said he had been employed in my company for nine years and was approaching his 65th birthday, which was to fall on 31 December in the year in question. He said he enjoyed his work and that he would be retiring on 31 December, but he died six days before this, on Christmas Day. His wife died a few days later and the two funerals were held within a few days of each other.

While attending the funerals in the church, I remembered his having told me that he looked forward to going to work when he woke up in the mornings and that he had looked at his watch on many occasions while at work in the belief that it was 4 p.m. only to discover it was 6 p.m. I said to myself that it would be marvellous if my company and employers in general could set a standard such that all employees would hold such views. The man's words have stayed in my mind ever since.

I am reluctantly saying there is a need for legislation to secure employment rights, but it is a pity this is so. It would be desirable to find a way to make employers recognise the enthusiasm, commitment and goodwill of employees such that they could reap the benefits. There will always be those who break the rules but, ideally, those who do not should be the ones who succeed in business and reap the benefits to be gained from their employees.

When I considered the various employment Acts — I wish I had done a better job in this regard — I realised that even where legislators have the best will in the world, legislation that affects employment can have the opposite effect to that which is desired. Consider an example from France. The French decided to solve their unemployment problem by introducing a maximum working week of 35 hours. It was believed that many more jobs would be created if those who were working 40 or 50 hours were only allowed work for 35 but the very opposite happened. In spite of the goodwill and good intentions of the then French Government, far fewer jobs were created because employers could not afford to employ people for 35 hours at the same rate.

I make this point because we are now very much in a global economy. If we are to attract investment into Ireland, we must ensure all our standards make the country attractive. I am not only talking about employment legislation but also about other types. In spite of legislators having the best intentions in the world, they often create circumstances in which Ireland becomes more regulated and restricted.

Foreign direct investors are wondering whether the best place to invest is Europe or elsewhere. If they decide on Europe, they wonder whether to invest in Ireland or some other European country. Each legislative measure or regulation might have the best intentions but might result in the same situation that was seen in France, where the end result was the opposite to what was intended.

The legislation referred to by the Minister of State has good intentions which are difficult to criticise. However, it is another little step along the road to making Ireland a little less attractive. It is not enough to claim that there is a EU directive pushing us in this direction because that might well make Europe less attractive. Europe is in the global economy and will also have to attract attention and investment from elsewhere. My thoughts on this area are from the perspective of ensuring we are competitive.

Another point worth making relates to the complexity of the legislation. One of the growth areas in Ireland is foreign direct investment by large companies such as Hewlett Packard, Microsoft and Intel. However, the growth we really need is in indigenous industry and among indigenous traders. These are the people who start businesses. They do not have the big support structure. If they wish to take on one new employee, the complexity of what they must do and be aware of makes it difficult to do so.

I remember travelling on an aeroplane some years ago with the chief executive of a large company in Ireland. He was also on the board of the company in the United States. He told me that one of the managers had come to the board meeting in the United States the previous week with an idea. The manager urged the board to start a new enterprise. When the board asked what would be involved, the manager said he would take on 37 people. He believed there was a good chance he would make a success of the venture. The board gave him the go ahead. However, the Irish man asked what would happen if it did not work. The reply was that the 37 people would be let go. The Irish man told me: "We could not do that in Ireland." We make it so difficult and so restrictive that if somebody took a chance to take on 37 or even two people and had to let them go again, the difficulties that would be created are such that it is quite likely the company would not take that first step.

This is the difference between what was happening in the United States and what was happening in Ireland at that time and even now. Each legislative measure we pass makes it a little less attractive to take on an employee. Can we make it more attractive to take on people, even if five or nine out of ten of those enterprises fail? Where one blossoms and grows, we have succeeded. It worries me that each step we take lessens the opportunity to do that. I have a concern about the complexity of the legislation, particularly for smaller employers. In this regard it is acknowledged that the legislation has become increasingly complex over the years.

Some of the EROs and the REAs should be either updated or even abolished. Taken in conjunction with the introduction of the national minimum wage and the transposition of protective legislation from the EU, it could be argued that the requirement for these industry specific measures is redundant. The Minister might consider that. The case has been made that the growth in the body of employment legislation since 1990, only 15 years ago, when 18 separate labour laws or regulations have been enacted, has overtaken the need for much of the focus on those industry regulatory instruments.

Another big point that is hard to make relates to the minimum wage. There are some jobs that do not exist at a certain price. It is very hard to argue against increasing the minimum wage because nobody wants to see people working for a rate that is less than one can live on. However, some jobs cannot exist for that wage. The example I offered some days ago when discussing this is that ten years ago when one bought petrol, the garage employed somebody to put the petrol into the tank. There were many jobs that were extremely menial and which did not yield a great deal of money. Some of them were probably part-time jobs. However, they were jobs people were willing to do. The introduction of the minimum wage made it impossible to make those jobs pay for themselves. The jobs, therefore, ceased to exist.

There are many other such jobs. It is when I go to other countries that I see people willing to work for rates of pay that are lower than the minimum wage. The job might be a second or surplus job. I am not arguing against a minimum wage but we should remember that its existence means that certain jobs can no longer exist.

There is an unemployment problem in Ireland. The problem is that the same people are being left at the bottom of the pile all the time. When jobs become available these people do not get onto the first rung of the ladder by getting that first job. I do not know the answer to this. It is not to reduce the minimum wage to half its rate to employ these people. In Ballymun recently there was a large amount of construction but when the people in the area who would, perhaps, not be the first choice of an employer went looking for the jobs, they found they were already filled because the construction companies brought their own people with them.

The same people are being left at the bottom of the pile. I am not sure what the solution is but perhaps it might be possible to subsidise employers in some way so the minimum wage can be paid. I can see the difficulties this would cause but it might be a way to achieve something in this area.

The proposal for a standardised record keeping format is a practical and beneficial measure for employers and employees. It removes the ambiguity that might exist. However, we should be careful that any standardisation of records does not impose an undue administrative burden on employers, particularly the small and medium sized enterprises. We should be creating opportunities for them.

I wish to refer to the increase in the penalties. The fines prescribed in various statutes might not have the deterrent effect they once had but it is important to ensure that due process is maintained for all parties. That does not always happen. The same applies to the imposition of on-the-spot fines. All these act in some way or other as a deterrent to taking on a new employee. With regard to the annual declaration of compliance, the complexity and ongoing evolution of employment rights legislation make a system of self policing problematic. I am not sure how the declarations should work.

If there is one message I wish to give to the Minister it is my concern that each extra regulation we introduce, with the best intentions, is a deterrent in some small way to creating more jobs.