Seanad debates

Tuesday, 4 November 2014

Adjournment Matters

Employment Rights

7:15 pm

Photo of Fidelma Healy EamesFidelma Healy Eames (Fine Gael)
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I welcome the Minister, Deputy Richard Bruton, to the House. I am grateful that he is here to take this Adjournment matter as the senior Minister in the Department.

My case is the need for the Minister for Jobs, Enterprise and Innovation to consider the poor prospects of agency workers who exist on week-to-week contracts and how he can improve their lot. It is in everyone's interest that workers are happy and that people stay working. We do not want to make welfare attractive or to create a welfare trap. The Minister will know that I have a long record in supporting work and employment and in supporting multinational companies as well as small local businesses.

I was quite stunned when I heard of some of the conditions under which agency workers are employed. I will document some of them for the Minister. Agency workers are employed by an agency and not by the company directly, although they work in the company. The main kernel of the problem is that they work on week-to-week contracts and are paid on a scale ranging from the minimum wage to a little more than €10 per hour. One worker met me to describe his plight. He earns approximately €21,500 a year but his biggest problem is that he is employed on a week-to-week contract. He is not a baby; he is 39 years of age. He would like to get married but he cannot even qualify for a credit union loan. He cannot get a car loan or a mortgage because of the lack of job security in the contract. He has no benefits in terms of sick pay or a pension. Others mentioned to me that some agency workers are on a week-to-week contract for up to three years without any definite contract duration. That is quite a long time. They are the issues I would like the Minister to address in terms of legislation he is planning to bring forward and guidelines he can issue to agencies. Is he examining lengthening the week-to-week contract, even to three to six months, which would be helpful? In some cases agency workers' wages have been reduced from €10 an hour to the minimum wage.

This policy of low pay is a big issue. This individual pointed out to me that, under the budget, he will get an extra €3 a week, but that will not make any sizeable difference to his life. I reiterate that the biggest problem is the week-to-week contract because, to use that individual's words, he feels "it is messing with people's lives". He cannot get a mortgage, a car loan or a credit union loan. He said: "my head is exploding as I want out of here but where else can I go - I want to work - but into another agency job". It is desirable that the weekly contracts be extended to short-term contracts, for example, up to six months, which would give workers the ability to plan ahead. This would be good for companies too because they would be able to plan ahead. If there is better morale among the workers, it will improve spirits in the company. While it is somewhat nebulous, one can always recognise good worker morale and good spirits in a company.

The perception is that the law suits companies and the Government backs it. We all need employment and I support jobs, growth and the growth of GDP, but workers' rights and dignity matter too. If lengthening the duration of contracts is not examined, the danger is that it could make welfare attractive, and creating a welfare trap is the last thing we would wish to do.

I have many more examples. Another one is that after the deduction of PAYE tax, PRSI, the universal social charge, the property tax and with the water tax that is being introduced, there is very little left to live on and that all that is left to tax now is the air. I am not being sensational about this but my fundamental question to Minister is what he can do and, more important, what he will do to improve workers' conditions and contracts for agency workers. The attributes of the agency worker are just as important to the company as those of the permanent worker. We are very lucky to produce creative and flexible people and, above all, people who want to work on low wages. I await the Minister's reply.

7:25 pm

Photo of Richard BrutonRichard Bruton (Minister, Department of Jobs, Enterprise and Innovation; Dublin North Central, Fine Gael)
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I thank the Senator for raising this issue. There is no doubt that pay and conditions form a continuing issue to which my Department gives very careful attention. One of the first things we did on entering Government was to increase the minimum wage, which had been reduced under pressure in the previous negotiations with the troika. We restored that minimum wage. We have also been implementing a wide range of reforms in the wage-setting area where we have sought to re-establish the system of joint labour committees and the registered employment agreements which were struck down by the courts. Specifically, in regard to agency workers, we introduced the Protection of Employees (Temporary Agency Work) Act 2012, which provides that agency workers must receive equal treatment in regard to the pay they receive with the permanent workers in the same company. That has been a very important measure and it was backed by an EU directive but had not been implemented in Ireland. That gives protection to agency workers.

Clearly, we are concerned about what are called zero-hour contracts. In our new agreement for the second phase of the programme for Government between the Taoiseach and the Tánaiste, a study of zero-hour contracts is being undertaken. The position of zero-hour contracts is somewhat different in Ireland from the UK, where this has been a centre of very considerable concern, in that people here who are required to be on-call have some protection from the Organisation of Working Time Act, which provides that they will have to be paid for 25% of the period during which they are on call. I think that is a provision under section 18. They have to be paid for 15 hours or 25% of the time whichever is the lesser. There is a protection there.

Employment law does not seek to regulate the duration of a contract but it provides that people who are on contracts enjoy the same access to employment rights, holiday entitlements and so on as any other worker. I do not think the State can start insisting on the duration of a contract because inevitably people set contracts depending on the scale of the projects they are working on and it is not possible to require companies to have contracts of a certain duration. Clearly, agency working, and temporary working generally, is a feature. It should never be a major part of the workforce but there are employees it suits and employers it suits who have seasonal fluctuations whereby they can arrange some of their production on this more flexible arrangement.

We have introduced a large number of changes. We are establishing a commission on low pay and the newly appointed Minister of State in my Department, Deputy Gerald Nash, will steer that legislation through. It will come to the House in due course and it is his intention to appoint an interim commission on low pay. There has been such a body in the UK and by common acclaim it has done a good deal of valuable work in understanding the process and making sure that the both the employment opportunity and the need for protection of people in low paid positions would be balanced. We have a programme of work in terms of examining the zero-hour contact and the establishment of a commission on low pay. We have implemented legislation on agency workers and are bringing in the REA legislation. We have a good suite of protections in place. I am always open to looking at amendments in our legislative framework but the emphasis in recent years has been to consolidate legislation following a number of court decisions that undermine the existing approach. I hope those comments have addressed some of the Senator's concerns.

Photo of Fidelma Healy EamesFidelma Healy Eames (Fine Gael)
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If the Minister or I were employed on one of these week-to-week contracts, we would not be able to plan our lives. What comfort can he give me to pass on to the considerable number of the workforce - 150,000 people - employed as agency workers? I look forward to the establishment of the commission on low pay. I could just as easily be talking on behalf of the employers' side or the small business sector but my job is to represent whatever concerns are put forward. How can these workers plan ahead? How can they borrow a penny? What can the Minister say that could help? Would he consider, for example, requesting companies, through legislation, to set the duration of contracts according to the length of a project?

7:35 pm

Photo of Richard BrutonRichard Bruton (Minister, Department of Jobs, Enterprise and Innovation; Dublin North Central, Fine Gael)
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In this area we must provide legal protections that are general in their application. Not all agency workers are low paid - some agency workers are quite highly paid and in some professions working through an agency gives higher pay. As Senator Healy Eames rightly says, some agency workers are vulnerable to being treated very badly. That is why we passed legislation in 2012, which I brought through the House, requiring equal treatment in relation to pay and basic working and employment conditions. That is in effect since 5 December 2011. It requires that people who are brought in through an agency on a temporary basis be treated identically to the full-time staff of the same company.

Photo of Fidelma Healy EamesFidelma Healy Eames (Fine Gael)
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Not in terms of pay.

Photo of Richard BrutonRichard Bruton (Minister, Department of Jobs, Enterprise and Innovation; Dublin North Central, Fine Gael)
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Yes, in terms of pay. Pay is defined as basic pay-----

Photo of Fidelma Healy EamesFidelma Healy Eames (Fine Gael)
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I heard the Minister.

Photo of Richard BrutonRichard Bruton (Minister, Department of Jobs, Enterprise and Innovation; Dublin North Central, Fine Gael)
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-----and pay in excess of the basic pay in respect of shiftwork, piecework, overtime, unsocial hours worked or hours worked on a Sunday. It covers the pay element, but it does not cover pensions, and those sorts of-----

Photo of Richard BrutonRichard Bruton (Minister, Department of Jobs, Enterprise and Innovation; Dublin North Central, Fine Gael)
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Or sick pay. However, this is an arrangement whereby these people are working on a short-term agency basis. That does not suit everyone but it does suit some people and we are seeking to recognise that this is a flexible option that suits some people and some employers but one cannot demand of an employer who has a temporary assignment that it will endure. They often do not know how long demand will be such that-----

Photo of Fidelma Healy EamesFidelma Healy Eames (Fine Gael)
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I understand completely.

Photo of Richard BrutonRichard Bruton (Minister, Department of Jobs, Enterprise and Innovation; Dublin North Central, Fine Gael)
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We can only provide a general provision, as we are doing, but we are different from the UK in that where people are required to be available they are guaranteed the 25% or 15 hours even if they do not work. We are looking again at the zero-hours contract. I will ensure that the officials in my Department who are initiating that study of zero-hours contracts will look at the sort of cases that Senator Healy Eames has raised and will factor those into that study.

By and large, however, we have put in new protections for the very type of worker that Senator Healy Eames is concerned about. We are looking at the issue of low pay, if such people are on low pay, and we are looking at zero-hours contracts. Across the spectrum of issues the Senator has raised, if we have not already implemented change we are actively looking at areas where we could improve the environment. At the same time we recognise that there is huge pressure - with 21,000 people emigrating from Ireland and 11% unemployment one must balance any measure taken on one side with the need to create employment on the other. One of the things that has been seen in the past few years is that this recovery started with largely part-time working and shorter duration contracts. In the last 12 months all of the employment growth is in full-time positions. As recovery has taken hold we have seen what were short-term opportunities becoming more established in duration and people getting into a better position to plan their future. Agency working is just one element but it is being regulated in a way that we believe is bringing greater fairness into the environment.

The Seanad adjourned at 6.55 p.m. until 10.30 a.m. on Wednesday, 5 November 2014.