John Curran (Dublin Mid West, Fianna Fail)
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252. To ask the Minister for Employment Affairs and Social Protection the details of all investigations and reviews undertaken by the scope section of her Department, either solely or in co-operation with the Revenue Commissioners, to address the issue of bogus self-employment over the past five years; and if she will make a statement on the matter. [27373/19]

John Curran (Dublin Mid West, Fianna Fail)
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253. To ask the Minister for Employment Affairs and Social Protection the number of cases referred to the scope section of her Department for determination; the number of cases dealt with in under three, three to six, six to 12 and over 12 months, respectively; the number of referrals that resulted in a determination of a person being categorised as an employee in each year; the number of cases appealed; the number of appeals that were successful in each of the past five years to date in tabular form; and if she will make a statement on the matter. [27374/19]

Regina Doherty (Meath East, Fine Gael)
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I propose to take Questions Nos. 252 and 253 together.

I am committed to address the issue of false self-employment, and I have put in train a series of measures to deter, detect and tackle it. A key element is the increased focus by Social Welfare Inspectors on the enforcement of PRSI compliance obligations. Inspectors nationwide have commenced a campaign of employer inspections and a new unit is being established to focus specifically on the area of false self-employment.

Deliberate misclassification of employment status is an offence with penalties on prosecution of up to three years imprisonment and/or fines up to €13,000 or twice the amount denied to the Social Insurance Fund as a result of the misclassification, whichever amount is greater. The new unit will ensure that cases of fraudulent misclassification of employment status are prosecuted and that the full force of penalties are applied. To this end, led by my Department, the 2007 Code of Practice on Employment Status will reach the end of a comprehensive revision process next month. This Code will be a vital tool for employers and employees alike so they can be clear when a worker is genuinely self-employed. This document will be circulated to ICTU and IBEC for their input before it is published. In addition, Heads of Bill have already been drafted in order to place the revised Code on a statutory footing later this year.

The question of whether a worker is employed or self-employed is not always a simple one. The Courts have repeatedly stated that a decision must be made based on the specific facts of each case, having regard to key tests such as the level of control a would-be employer has over the worker and the level of obligation they have towards each other.

My strong view is that this is a far better mechanism than trying to capture in legislation a definition that can never be black and white.

I have instructed my officials to also explore a range of legislative proposals to complement the increased inspection work that will be key to the long term success of this project. These proposals include anti-penalisation provisions for workers who will be able to take a claim to the WRC if they are victimised by an employer for raising a query regarding their status; and an increase in penalties for employers who deliberately misclassify employees as being self-employed.

Scope Section of my Department undertakes investigations on foot of requests from a variety of sources, for example employees, employers or Social Welfare Inspectors. These investigations cover a variety of situations, for example, modified classes of PRSI for civil and public servants, family employments or insurability of Directors.

Of all the cases referred to Scope, the number involving the mis-classification of an employee as self-employed constitute a small proportion. A breakdown of cases is not available pre 2018 as the historic database in use in Scope did not allow this categorisation.

The following statistics show the number of decisions made involving situations where employment status was misclassified, and the length of time within which the decisions were made:

Number of cases in sub-category of Employed / Self-Employed (Decision Made)

I would point out that these cases do not always involve a deliberate / fraudulent mis-classification of a worker as self-employed. Sometimes it happens that both employer and employee are genuinely mistaken in their approach and are happy to correct the position once the Department’s officials make a determination.

The number of such cases that resulted in a determination of ‘employee’ status (Class A PRSI) was as follows:

Number of cases in sub-category of Employed / Self Employed dealt (Decision made) resulting in Class A determinations

Cases are not recorded at present to allow statistics to be provided on the number of such cases appealed as a separate category. However, I can confirm that there are currently 11 cases of ‘employed / self-employed’ Scope cases on appeal with the Social Welfare Appeals Office. The following table provides figures for all Scope cases that were appealed to the Appeals Office over the last 5 years:

Scope appeal outcomes 2014 to 2019 (end May)

Scope carries out its own investigations. However, the Inspectors of my Department undertake joint investigations with Inspectors of the Revenue Commissioners and the Workplace Relations Commission where appropriate.

I hope this clarifies the matter for the Deputy.