Micheál Martin (Cork South Central, Fianna Fail)
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Question 136: To ask the Minister for Jobs; Enterprise and Innovation if he has satisfied himself that sufficient protections are in place for employees and contractors who are made redundant by a company in order to be replaced by other employees' contractors at below registered employment agreement rates. [17948/11]

Micheál Martin (Cork South Central, Fianna Fail)
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Question 137: To ask the Minister for Jobs; Enterprise and Innovation if his attention has been drawn to any reports regarding companies making employees/contractors redundant in order to take on other employees/contractors at below regulation employment rates; the steps had he taken or will take to deal with same. [17949/11]

Richard Bruton (Dublin North Central, Fine Gael)
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I propose to take Questions Nos. 136 and 137 together.

There are a range of safeguards built in to employment rights legislation to guard against abuses of the employer-employee relationship, particularly when dealing with matters relating to the termination of that relationship e.g. unfair dismissal. Where employees are let go in any job and they are replaced, it may be open to those employees to bring a case of unfair dismissal under the Unfair Dismissals Acts 1977-2007. The Unfair Dismissals Acts lay down criteria by which dismissals are to be judged fair or unfair and provide redress for an employee whose dismissal has been found to be unfair. Under the Acts, the onus is generally on the employer to show that the dismissal resulted wholly or mainly from one or more of the grounds specified in the Acts or that there were other substantial grounds justifying dismissal. While one of the grounds justifying dismissal under the Acts is where a genuine redundancy situation exists, the genuineness or otherwise of a redundancy situation will be considered during the hearing of the case.

In addition to the above protections, the Government, by way of the Protection of Employment (Exceptional Collective Redundancies and Related Matters) Act 2007 enacted legislation to address concerns regarding possible compulsory collective redundancy with the planned replacement of workers by direct employees employed by the employer or by the use of other replacement workers by the aforementioned employer in the same location or elsewhere in the jurisdiction, on materially inferior terms and conditions, and with the new workers performing essentially the same functions as those to be made redundant.

The 2007 Act provides a mechanism for the setting up of a Redundancy Panel which allows for referral by employee representatives of a case to the Minister for Jobs, Enterprise and Innovation who in turn can ask the Labour Court for an Opinion as to whether or not the proposed collective redundancy dismissals were in fact genuine. It also provides for a range of sanctions for situations where dismissals took place contrary to an Opinion of the Labour Court, with particular reference to redundancy rebate entitlements, tax treatment of redundancy payments as well as consideration of Unfair Dismissal entitlements in such situations, and for penalties and appeals.

By way of further obligations imposed under the terms of the Protection of Employment Act 1977, companies proposing collective redundancies must provide certain information to employee representatives regarding the proposed collective redundancy. They must enter into consultation with the employee representatives at least 30 days before anyone receives notice of redundancy. Companies must also notify the Minister for Jobs, Enterprise and Innovation of the proposed redundancies at least 30 days before any employee receives notice of redundancy. The consultation with the employee representatives and the notification period for the Minister can run concurrently.

I should also emphasise that workers in sectors covered by statutory wage setting arrangements [Registered Employment Agreements (REAs) and Employments Regulation Orders (EROs)] may not be paid lower rates than those provided for in the relevant REA or ERO. REA's and ERO's are enforced by NERA inspectors including the issue of rates payable thereunder. In addition, a party to a REA e.g. in the Construction area can bring a case for a breach of the Agreement to the Labour Court for adjudication. NERA inspectors have power to enter premises, inspect wage sheets and other records, interview the employers and workers concerned, recover arrears and, if necessary, take legal proceedings against an employer who is in breach of an ERO or REA. An inspection can be undertaken either as part of a routine inspection by NERA or on foot of a complaint. I understand that NERA is not aware of any reports of the nature referred to by the Deputy.

The above provisions represent core elements of protections for employees and I am satisfied that the current protections are satisfactory. The situation in relation to contractors, who themselves may have their contract terminated, would be dealt with on a case by case basis as such persons may be employed on a contract-for-services basis rather than a contract-of-service basis i.e. they may be "self-employed" rather than an "employee".