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Employment (Miscellaneous Provisions) Bill 2017: Second Stage (Continued)

Wednesday, 14 February 2018

Dáil Éireann Debate
Vol. 965 No. 5

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(Speaker Continuing)

[Deputy Regina Doherty: Information on Regina Doherty Zoom on Regina Doherty] That will make it administratively easier for employers to use the sub-minima rates. It will also limit the application of sub-minima rates for employees, which is a positive outcome for all parties. I trust that this amendment, as recommended by the Low Pay Commission, will be supported by all sides of the House, as it seeks to improve the position of low-paid workers, as well as reducing the administrative burden for employers.

I am also taking the opportunity in the Bill to introduce an amendment to section 8 of the Unfair Dismissals Act 1977 to allow for stronger enforcement of the legislation by the Workplace Relations Commission. At present, adjudication officers of the WRC do not have powers to compel witnesses to attend a hearing to give evidence in cases taken under the Unfair Dismissals Act 1977. The WRC has similar powers of witness compellability under other employment rights legislation and it is my intention to remedy this situation by putting unfair dismissals legislation on the same fooling as other employment rights legislation.

The Bill is the culmination of three years of work. I think all reasonable commentators and stakeholders will recognise that it as a genuine attempt to improve the law in this area. I hope they also appreciate the difficulties inherent in trying to strike what is at times a delicate balance between the respective rights and obligations of employees and employers. Most importantly, I believe the balance struck in the Bill is fair for all concerned. I look forward to hearing the Deputies' views and working with them to progress this important legislation through the Houses as quickly as possible. I am proud to commend the Bill to the House.

Deputy Willie O'Dea: Information on Willie O'Dea Zoom on Willie O'Dea I welcome the introduction of the Bill. One of the fundamental cornerstones of the profit theory is the higher the risk, the greater the reward. In other words, a person who risks his or her money in a highly volatile investment usually expects a greater reward as a result of taking a greater risk. This principle seems to have been turned on its head in employment practice throughout the western world. Today it is generally those who are paid least who face the greatest employment risk, while those who are paid most face the least risk.

Unemployment in Ireland has fallen in the past ten years. However, in many cases the new employment which replaced the employment that was lost is precarious. That means that it is insecure, uncertain and often low paid, in which the risk is shifted from employers to workers. This takes the form of bogus self-employment, to which I will return later if I get a chance, zero-hour contracts, if-and-when contracts in the so-called gig economy, as well as changes in the working hours of those in more common forms of employment. While the quantity of employment has undoubtedly risen in recent years, the quality of employment has fallen drastically in tandem in the same period.

The precise number of employees on precarious contracts in Ireland is unknown, but I suspect it is a moveable feast. However, some information can be gleaned from statistics compiled by the CSO. Ireland has the second highest level of underemployment in the European Union after Spain. Some 7.5% of employees in Ireland report seeking additional hours; the EU average is only about half of that rate. In the past ten years the number classified as underemployed in Ireland has increased by over 50%. This compares with growth of just over 30% across the European Union during the same period.

This is not a problem at the fringes of the job market. Individuals on precarious contracts work in all sectors and all occupations. Casual labour has traditionally been a feature of the construction and hospitality sectors, but it is now rapidly growing in other sectors, including the healthcare and early child-care sectors. The advent of social media has placed pressure on the traditional media, which is reflected in the fact that an increasing number of contracts of individuals employed in the media can be described as precarious. A recent study estimated that up to 40% of third level lectures are now being given by lecturers on atypical contracts. The same increasingly applies in the IT sector. Therefore, the practice is widespread. Needless to say, this has negative consequences. It certainly has negative consequences for employees. I argue it also has negative long-term consequences for employers. For employees, the position is obvious. They cannot afford to get sick, or to have a car crash or a family emergency. If they have any of these things, they will not be working or earning. They are often in a permanent state of limbo, at the whim of their employers. Their lives could be said to be permanently on hold. They cannot plan their lives and certainly not their finances. In many cases, they cannot access credit because they cannot prove how many hours a week they are working because there is nothing to indicate it, a point to which I will return, but that is not all. Generally, they are lower paid and have lower job satisfaction. They enjoy less on-the-job training and are considerably less likely to be promoted. All of the research shows that they form the category at the highest risk of poverty in the population.

I have also seen a huge amount of anecdotal evidence of the consequences for their mental and physical well-being. Many studies have shown that the negative effects of job insecurity on physical and mental health can be as great as or greater than the effects of unemployment, thereby giving the lie to the old canard that it is better to have any job than no job. All of this is underpinned by a system of distorted incentives, created no doubt in good faith. It is something at which we will need to look as we go through the year in dealing with social welfare issue.

This segmentation of work has given rise to growing income inequality across the world, as the gains from economic growth are increasingly being divided between those in full-time secure jobs and those who are not. High levels of income inequality will in the long term threaten growth and social stability. The sense of injustice that has arisen from increasing income inequality and the sense of insecurity which has arisen from the increase in precarious work practices have fuelled populist movements across the world.

In reading the documentation surrounding the committee's report on its discussions on the previous Bill I noticed that IBEC had sought to construct a completely alternative narrative. I understand it is seeking to argue that nowadays people want to work like this because they can look after their families or they need more leisure time. It has suggested they are very lucky that employers have now reached the stage where they are able to facilitate them and that we are all one big happy family, but that is not the reality. It is the reverse of the truth. The reality is that for the overwhelming majority of those on precarious contracts, their conditions are not chosen but imposed.

I said there were significant costs for employers and there are. The cost of administering all of this tends to make a business less competitive. There is obviously lower employee commitment and staff co-operation. Teamwork is also lower. Much of the research has shown that while there may be some short-term savings for employers, they are more than offset by long-term losses in productivity.

During the debate on the committee's report the then Minister of State, Deputy Carey, claimed that the Government Bill was infinitely better than the one debated by the special committee, even as amended by it. I have read the Bill before the House as carefully as I can and the validity of that statement is not immediately obvious to me.

I want to raise a number of issues with the Minister, the first of which is the 18-month reference period. In her opening contribution she stated that one of the things that underpinned the legislation and had helped to shape it was the study carried out by the University of Limerick. To the best of my recollection, the study recommended a reference period of nine months. I think the committee then agreed on a compromise period of 12 months. Today a period of 18 months has been presented to us. I do not see any logic to it.

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