Written answers

Thursday, 7 July 2011

Department of Enterprise, Trade and Innovation

Pay Rates

5:00 pm

Photo of Michael Healy-RaeMichael Healy-Rae (Kerry South, Independent)
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Question 143: To ask the Minister for Jobs, Enterprise and Innovation his views on a matter (details supplied) regarding low paid workers; and if he will make a statement on the matter. [19405/11]

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
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Earlier today, the High Court issued its ruling in a legal challenge, taken by John Grace Fried Chicken Ltd and others, to the Joint Labour Committee system and the 2008 Employment Regulation Order (ERO) covering the Catering Sector outside of Dublin. The High Court ruled that certain provisions of the Industrial Relations Acts of 1946 and 1990 governing the making of EROs are unconstitutional and that the 2008 ERO constituted an unlawful and disproportionate interference in the property rights of the plaintiffs. I am currently considering the implications of the judgment in consultation with the Attorney General.

The overall finding of the Report of the Review of Employment Regulations Orders and Registered Employment Agreement Wage Setting Mechanisms was that the basic framework of the current ERO/REA regulatory system requires radical overhaul so as to make it fairer and more responsive to changing economic circumstances and labour market conditions. The Report does not recommend, nor have I proposed, specific adjustments in wage rates and other conditions of employment for employees covered by EROs/REAs.

Workers are protected by contracts of employment and proposed reform of the wage setting mechanisms would not if implemented, change the terms of those individual contracts. What is proposed would have the effect of changing how pay and conditions are set in order to make the operation of the machinery more flexible and prevent businesses being left behind by changing economic circumstances. Existing employees would not have their current entitlement affected by future changes to EROs unless (a) it is already stipulated in their contract of employment that they be paid at the prevailing rate of pay and conditions set by the relevant ERO or (b) the application of alternative provisions to those specified in the ERO is agreed between the employer and the employee or the employee's representatives.

The Government is determined to proceed with urgency to a substantial reform of the current JLC / REA regulatory system in order to protect existing jobs in these vulnerable sectors of the economy and to increase the likelihood of employment in these sectors being increased. This will restore competitiveness in key sectors of the economy, including the hospitality sector which is crucial to our tourism product offering, and complement the restoration of the recent cut to the National Minimum Wage thereby providing an adequate floor for lower paid workers.

Together with the decision to restore the National Minimum Wage to €8.65 per hour, the decision to reform the Joint Labour Committee structure represents a significant commitment by the Government to the lowest paid and most vulnerable workers in the economy.

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