Martin Conway (Fine Gael)
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The Minister of State, Deputy Higgins, is very welcome to the House.

Alice-Mary Higgins (Independent)
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I welcome the Minister of State to the House. What plans and measures are in place, including legislative measures, to implement the EU directive on adequate minimum wages, which I understand was published in October 2022 and must be transposed into Irish law by 15 November 2024?I am concerned that we have not seen legislative measures and legislation coming through the Houses. I am not aware of any statutory instruments put in place regarding the transposition, even though it has been very strongly signalled by the key parties and relevant stakeholders, including the unions, that legislative measures are required to ensure proper and full transposition. I agree with them. I am going to focus on two articles in particular.

Article 4 concerns the requirement that EU member states would promote and increase the coverage of collective bargaining rights in terms of wage setting for workers, and that enabling conditions would be created in states such as Ireland where the collective bargaining rate is less than the threshold of 80%. Such enabling conditions for collective bargaining would be put in place either by law, after consulting the social partners, or by agreement with them. The intention is that there would be an action plan to promote collective bargaining. I would like to know what is in the action plan. Ireland is not just below the 80% threshold - we have a rate of 22% even though research has shown that over two thirds of workers would like to be in a union and would like to engage in collective bargaining. Certain obstacles have been highlighted in that regard. The Minister of State will be aware of the Respect at Work campaign, which has highlighted the issue of union busting and the penalisation of organisers and those who seek to support the organisation of collective bargaining. The campaign has highlighted certain measures that are needed, gaps in the Unfair Dismissals Act and problems in some other parts of our legislation that need to be strengthened to ensure persons feel free and able to join a union. These key things need to be addressed as part of Ireland moving from the very low threshold of 22% towards the 80% goal under the directive.

I wish to highlight Article 5 as a specific focus. It requires EU member states to set the minimum wage at a level for workers which allows them to "[achieve] a decent standard of living, [reduce] in-work poverty, [promote] social cohesion and upward social convergence, and [reduce] the gender-pay gap". There is a reason that the word "adequate" is in the title of the adequate minimum wage directive. Adequacy is the key test of a minimum wage. However, Ireland’s legislation for the Low Pay Commission - the Government has indicated that is where it sees this being addressed – does not include the phrase "adequacy". It is not a test. I am aware of this as I worked for the National Women’s Council of Ireland. When that legislation was going through, we highlighted adequacy as a gap. Instead, the Low Pay Commission is told to consider things like competitiveness and what is fair and sustainable. It is not explicitly asked to consider adequacy. I have tabled a very simple Bill that seeks to add adequacy as one of the factors to be considered by the Low Pay Commission in the setting of the minimum wage. That very small legislative change would make it more possible for the Low Pay Commission to deliver on the obligations under Article 5 of the EU directive, which specifically requires that criteria in respect of adequacy be applied. I ask the Minister of State to address those two articles in particular, as well as the wider question of the transposition.

Emer Higgins (Dublin Mid West, Fine Gael)
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I thank the Senator for raising this very important issue. The directive on adequate minimum wages in the European Union was published on 19 October 2022. The Senator is correct when she says it must be transposed by 15 November of this year. The directive aims to ensure that workers and unions are protected by adequate minimum wages, allowing for a decent living wherever they work. The Government absolutely welcomed the publication of the directive and has been very supportive of its principles since it was first proposed. My officials have been heavily involved in the negotiations on the directive and are absolutely familiar with our obligations under it. There are three broad categories of obligations under the directive: the setting of minimum wages, the enhancement of collective bargaining coverage, and the improved enforcement and monitoring of wage protections. In considering our options for the transposition, my officials have been involved in bilateral engagements with several other member states as well as attending the European Commission’s transposition workshops aimed at assisting member states in transposing the directive, given the wide variety of approaches to minimum wage setting and collective wage bargaining across Europe.My Department also received legal advice on minimum wage and collective bargaining elements of the directive to ensure transposition by the mid-November deadline.

Article 4 of the directive, which deals with collective bargaining, is of particular interest to many stakeholders. This article requires member states with a collective bargaining coverage below 80%, such as Ireland, to provide "for a framework of enabling conditions for collective bargaining" and to publish an action plan to promote collective bargaining by the end of 2025. I would like to clarify that this is specifically for states that have less than 80%, but this is not a goal or what is set out in the directive. The Government is fully committed to developing a comprehensive and robust action plan, which is set out in the directive, and will do so in consultation with the social partners.

A working group has been established with Department officials and the social partners to examine what will be considered for inclusion in the plan. This group has met regularly and constructively this year. I also chaired a meeting in September of the LEEF subgroup on employment and enterprise at which the action plan was discussed with the social partners. On 15 October, the Cabinet was informed that my Department will publish the proposals for consultation and observations from interested stakeholders across the wider enterprise and employment sectors. That is consultation on proposals for the action plan. These include proposals arising from the LEEF high-level group report on collective bargaining, and those received from the social partners also. This consultation is to ensure that the views of all stakeholders are considered and included when we are finalising the content of Ireland’s action plan. It signals the Government’s strong commitment to ensuring we develop a comprehensive and robust plan. The feedback from the consultation will inform the future discussions of the working group on the content of the plan.

While my Department’s position is that no legislation is required to transpose Article 4 of the directive, legislation may separately be considered as part of Ireland’s action plan. Article 5 of the directive deals with the procedure for setting adequate statutory minimum wages, as the Senator said. Legal advice suggests that our current minimum wage setting framework, the Low Pay Commission, is already largely in compliance with the provisions of the directive, although there will be some minor amendments to the National Minimum Wage Act 2000 to bring the framework completely into line with the directive. The Government’s commitment to progress to a living wage, calculated as 60% of the median hourly wage, and the recent significant increases in the national minimum wage, a further one of which will commence in January, will help us meet our obligations in relation to the directive’s requirements around adequacy measures and indicative reference values for statutory minimum wages.

I reassure the Senator that the Government remains fully committed to continue to improve terms and conditions for workers. We have done an awful lot in this area in terms of a living wage, auto-enrolment, mandatory sick pay, and the right to request remote working. Most recently we have agreed to increase the national minimum wage from January, which will benefit workers ahead of inflation.

Alice-Mary Higgins (Independent)
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While there have been all these meetings, we are now entering into an election. The transposition will be concluded by November. I am concerned that we would have a minimalist approach to the transposition. I hope the Minister of State can reassure me. She mentioned the action plan. What steps will be taken to ensure that legislative measures are considered within the action plan in respect of Article 4? On Article 5, the Minister of State mentioned being largely in compliance. That is my point. It is largely but not fully in compliance because the Low Pay Commission's mandate lacks reference to adequacy as one of the factors it must consider and on which it must report.

The Minister of State mentioned minor amendments to the National Minimum Wage Act 2000. Will these amendments include explicit reference to the application of criteria in respect of adequacy such that adequacy will be one of the tests? Will there be reporting in respect of the adequacy of the minimum wage?

At EU level, it is the adequate minimum wage directive, not the minimum wage directive. This means adequacy has to be centre stage. That means considering whether these are wages one can live on, not if they are wages that suit competitiveness. It is not a simple back and forth between stakeholders but the principle of wages on which people can live and that are adequate for a decent standard of living for individuals and families. I ask the Minister of State to indicate explicit legislative steps and the steps needed to allow for legislative change under the action plan.

Emer Higgins (Dublin Mid West, Fine Gael)
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As the Senator sought reassurance, I am absolutely aware of the importance of this directive. Its transposition is a priority for my Department.As I have stated, we will be taking the necessary steps to ensure transposition happens ahead of 15 November. It is fully our intention to meet that deadline. While my Department’s position is that no legislation is required to do that, legislative change may be considered as part of the development of our action plan on collective bargaining, which must be completed by the end of next year. Work has already begun on developing that plan. As part of the working group’s agenda, the social partners have provided my Department with proposals. That includes proposals from ICTU on protections and access for trade union officials in the workplace and we are now going to consult on those proposals. I believe the outcome of the forthcoming consultation process will help to guide the Department when it comes to developing the proposed actions which may be considered by the Government - or, indeed, the next Government - for inclusion in our action plan. Work is already under way. I met with a number of representatives of ICTU and the private sector unions in Congress House. Those discussions are happening. However, the really important thing is that the consultation is now going to happen, which gives us an additional piece of information when we go to the next stage.

Regarding Article 5 and the adequacy, I thank the Senator for tabling her Bill on that. It is something at which I will absolutely look.

Alice-Mary Higgins (Independent)
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I thank the Minister of State. I lastly suggest that 80% would be a good target.

Emer Higgins (Dublin Mid West, Fine Gael)
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To clarify, it is not the target.

Martin Conway (Fine Gael)
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I thanks Senator Higgins for her constant work in this area as part of the EU scrutiny committee. It is much appreciated. It is very detailed and complex but very important. I thank the Minister of State for her time.