Willie O'Dea (Limerick City, Fianna Fail)
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535. To ask the Minister for Employment Affairs and Social Protection her plans to increase the basic rate payable, under the wage subsidiary scheme, to bring it in line with the increases in the minimum wage over the past decade; if her attention has been drawn to the fact that the lack of increase in the basic rate has been cited as a significant contributory factor towards job losses for many persons with disabilities, including 37 recently at a facility (details supplied); and if she will make a statement on the matter. [11229/21]

Heather Humphreys (Cavan-Monaghan, Fine Gael)
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The Wage Subsidy Scheme is an employment support to private sector employers, the objective of which is to encourage employers to employ people with disabilities and thereby increase the numbers of people with disabilities obtaining and sustaining employment in the open labour market. The scheme provides financial incentives to private sector employers to hire people with a disability for between 21 and 39 subsidised hours per week under a contract of employment. Estimated expenditure on the Wage Subsidy Scheme in 2021 is expected to be almost €26 million.

The basic rate of subsidy is €5.30 per hour giving a total annual subsidy available of €10,748 per annum based on a 39-hour week. The contract of employment offered must be for a minimum of 6 months and the employee should be subject to and have the same rights as per the conditions of employment as any of the other employees. Included in these conditions is the requirement that the employee must be paid the going rate for the job which must be at least the statutory minimum wage.

It should be noted that the subsidy rate contribution paid to the employer under this scheme is not linked to the statutory minimum wage - it is a subsidy claimed, subject to certain conditions, against the cost incurred where a productivity shortfall arises from a disability.

The financial supports for employers are structured under three separate strands and companies could benefit under one strand or under two or three strands simultaneously, as the case may be, depending on the number of people with a disability employed, as below.

Strand I is a general subsidy for any perceived productivity shortfall in excess of 20% for a person with a disability, in comparison to a colleague without a disability. The subsidy is based on the number of hours worked.

Strand II subsidy is payable when an employer employs three or more people with disabilities who are supported by a Wage Subsidy Scheme Strand I payment. Strand II is intended to cover the additional supervisory, management and other work-based costs relating to such employees. This top-up payment is a percentage of the Strand I subsidy and is based on the overall number of employees with a disability employed under Strand I. It ranges from an additional 10% of wage subsidy for 3 to 6 employees with a disability to a maximum of 50% of wage subsidy for 23+ employees with a disability. Therefore, when an employer has 23 or more Wage Subsidy Scheme employees a 50% top-up is applied to the hourly rate increasing the payment rate to €7.95 per hour for each employee.

The WSS is a demand-led scheme and there are currently 1,586 private sector employers availing of the subsidy in respect of 2,581 participant employees.

I am aware of the redundancies recently announced at the facility referred to by the Deputy. WSS subsidies have been provided to this employer under Strand I and Strand II in respect of 35 employees and one position is subsidised under Strand III. Staff in my Department have been assigned to work directly with the employer and with the employees affected by this redundancy to ensure they receive their proper entitlements and appropriate supports.

I will keep the Department’s employment support schemes for people with disabilities under review to ensure that they continue to meet their policy objectives and a review of the Wage Subsidy Scheme, including an examination of the rate of the subsidy, is scheduled to be carried out this year. However, any potential changes to these schemes can only be considered as part of the wider budgetary context.

I hope this clarifies the issue for the Deputy.