Written answers
Wednesday, 28 May 2025
Department of Enterprise, Trade and Employment
National Minimum Wage
Rose Conway-Walsh (Mayo, Sinn Fein)
Link to this: Individually | In context
166. To ask the Minister for Enterprise, Trade and Employment his views on the report of the Low Pay Commission on sub-minimum, or youth rates of the national minimum wages. [28370/25]
Peter Burke (Longford-Westmeath, Fine Gael)
Link to this: Individually | In context
The National Minimum Wage Acts allow for lower, or sub-minimum rates of the minimum wage for those employees aged under 20. Those aged less than 18 years can be paid 70 per cent of the full minimum wage rate, while those aged 18 years and 19 years can be paid 80 and 90 per cent of the full rate, respectively.
I welcomed the Low Pay Commission’s report on these rates, and the accompanying research report on the issue of sub-minimum rates prepared by the Economic and Social Research Institute (ESRI), which provided valuable information on the incidence and characteristics of sub-minimum employment in Ireland.
The research notes that while all employees aged 15–19 could legally be paid a sub-minimum wage, just under one-quarter are actually on a sub-minimum rate, with approximately three-quarters earning either the full minimum wage or higher pay.
The work to date has highlighted that this is a complex and nuanced issue. For example, the use of sub-minimum rates varies considerably across different age groups. A significant number of 15- and 16-year-olds are in receipt of sub-minimum rates, but a small minority of 19-year-olds are paid these rates.
It also found how the use of sub-minimum youth rates is largely concentrated in the accommodation, food and retail sectors.
The Low Pay Commission recommended the abolition of sub-minimum rates but noted that this is a complex issue.
My Department has commissioned an economic impact assessment of the Commission’s recommendations. This work is underway and close to completion and will provide us with more up-to-date data on the use of sub-minimum rates and will independently evaluate the economic impact of possible changes to the sub-minimum wage regime in Ireland by:
- Modelling the impact of making changes to youth rates on firms of different size and in different sectors and regions, and
- Examining any potential unintended impacts of making changes to youth rates, such as increased unemployment of younger workers and the possibility of young people exiting formal education in favour of entering the workforce.
The use of sub-minimum youth rates of the National Minimum Wage is a complex and nuanced issue, but this Government is committed to fair and sustainable wages for all workers.
The current system of youth rates is based on a percentage of the full minimum wage; when the minimum wage increases, these sub-minimum rates also increase, with young people in receipt of these rates seeing a commensurate increase in their wages.
There have been significant increases in the National Minimum Wage over the last few years, including the increase of 80 cent to €13.50 per hour on 1st January and the increase of €1.40 in January 2024. These increases have been ahead of wage growth across the economy and have delivered real wage growth to minimum wage workers.
These increases show Government’s continuing commitment to fair wages for the lowest paid workers in our economy, but it is also important to acknowledge the challenges the enterprise sector has faced over the last number of years.
We know that the use of sub-minimum youth rates is largely concentrated in the accommodation, food, and retail sectors, and that these are sectors that have reported facing considerable cost pressures.
Last month, Government approved the acceleration of the development of a new whole-of-government Action Plan on Competitiveness and Productivity, alongside a suite of immediate measures designed to bolster business resilience and support competitiveness.
As part of the immediate measures designed to bolster business resilience and support competitiveness Government has agreed to defer any decision on sub-minimum youth rates of the National Minimum Wage.
It is important that we give this issue the full care and deliberation it requires, and to not rush into a decision that could have unintended consequences, for young people, for employers, and considering the current economic uncertainties, it is important to proceed with caution to allow for a more comprehensive understanding of the evolving landscape.
Rose Conway-Walsh (Mayo, Sinn Fein)
Link to this: Individually | In context
167. To ask the Minister for Enterprise, Trade and Employment his views on the report of the Low Pay Commission ‘A study of minimum wage employment in Ireland using online job vacancy data’. [28371/25]
Peter Burke (Longford-Westmeath, Fine Gael)
Link to this: Individually | In context
The report “A study of minimum wage employment in Ireland using online job vacancy data” was published by the Economic and Social Research Institute (ESRI).
The report was funded by the Low Pay Commission under the terms of their research partnership agreement with the ESRI.
I welcome the publication of this report which provides further insight into minimum wage employment in Ireland using online job vacancy data. The report presents interesting information on the prevalence of minimum wage employment and how this can differ across regions and counties. The report also sets out the skills and experience levels minimum wage employers look for when filling vacancies and how the effects of the significant increase of €1.40 in the 2024 National Minimum Wage were seen in the jobs market.
I know this report will assist the Low Pay Commission in the formulation of their recommendations to me. The Commission has an evidence-based approach to arriving at its recommendations and I applaud their efforts to continuously expand the research, evidence and data available to them.
Minimum wage employees work in a range of important jobs across Ireland, and I am committed to ensuring that they receive fair and sustainable wages.
I expect to receive the Low Pay Commission’s recommendations for the 2026 National Minimum Wage in July.
Rose Conway-Walsh (Mayo, Sinn Fein)
Link to this: Individually | In context
168. To ask the Minister for Enterprise, Trade and Employment the status of the transposition of the EU Adequate Minimum Wages Directive; and if he will make a statement on the matter. [28372/25]
Peter Burke (Longford-Westmeath, Fine Gael)
Link to this: Individually | In context
The Directive on Adequate Minimum Wages in the European Union was published on 19th October 2022 and was transposed in Ireland via the Statutory Instrument S.I. No. 633/2024 - European Union (Adequate Minimum Wages) Regulations 2024, meeting the deadline of the 15th November 2024.
The Directive aims to ensure that workers across the European Union are protected by adequate minimum wages allowing for a decent living wherever they work.
The Programme for Government commits to the development of an Action Plan to promote collective bargaining by the end of 2025, as required by Article 4 of the Directive.
My Department recently held a public consultation process on the promotion of collective bargaining from the 14th April to the 12th May 2025. My Department will now carefully review the submissions received. It is intended that the consultation will help guide us in finalising the proposals, both legislative and administrative, which may be considered for inclusion in Ireland’s action plan.
No comments