I move: "That the Bill be now read a Second Time."
This Bill sets out to correct a serious omission in our statute law in respect of the individual's right to fair treatment by his employer in circumstances where the employer either contemplates or has decided that he should be dismissed. As the law stands, the employer could proceed to implement dismissal in circumstances where the culpability of the individual worker need not be soundly based. The employees recourse up to now against the unjust dismissal lay only through action in the courts in which he would risk all the personal affront entailed by the law's delay. This omission in our industrial legislation has resulted in a number of dismissals occurring in which individual employees often with many years of service in enterprise to their credit lost their employment without due cause. Arguments about the rights and wrongs of such decisions leading to dismissals have led to costly strikes.
I am convinced that we must limit the area of arbitrary behaviour in industrial relations from whatever side it emanates. In its place we must institute codes of behaviour jointly obeyed by both sides in an enterprise so that those who direct and those who implement will be guided by criteria based on justice and rationality. I am convinced that the adoption of such an approach will not jeopardise the efficiency of any business concern.
As the law stands, the employer has the absolute legal right to hire and fire at his discretion. He must, of course, give the requisite notice as required under the Minimum Notice and Terms of Employment Act, 1973, which provides for periods of minimum notice based on service. In practice, what has happened when an employee has felt aggrieved by the manner of his dismissal is that he sought the support of his fellow employees. Because no accepted procedures governing discipline in general existed, disputes have occurred in firms where large numbers of workers were drawn into disputes which primarily concerned an individual or individuals because of their conviction that an injustice had occurred. The probability of this consequence followed because the law was silent on the matter. Because of the law's silence the crude weapon of strike action was resorted to. Despite the best efforts of both the rights commissioners and the Labour Court disputes occurred affecting large numbers of people. These disputes owe their origin to the individual sense of unfair treatment in the matter of his dismissal.
The incidence of disputes relating to dismissals involves enormous social and economic costs to the individual, his fellow employees and the economy generally. In the years 1972 to 1975 there were 187 recorded disputes classified as relating to "engagement or dismissal, redundancies, etc." in which 26,299 people were involved. These disputes alone accounted for over a quarter of a million man-days lost in industry. During last year over one-third of all man-days lost, that is 116,000 man-days, were due to these reasons. I do not suggest that all such disputes will be eliminated by the passing of this legislation but I would hope that the necessity to engage in industrial action will be lessened. To that extent the Bill will be of benefit to both sides of industry by helping to remove dismissal cases as a significant factor in industrial disputes.
The provision of this legislation will apply to employees in all occupational categories, manual, white collar and technical employees at all levels from the shop floor to the managing director. In all about three-quarters of a million employees will be covered.
I have said that my objective is to limit the area of arbitrary behaviour in industrial relations. The Bill lists in detail criteria for unfair dismissals and sets down the forms of redress and the methods of adjudication on claims. The basic proposal of the Bill is that the dismissal of an employee will be regarded as unfair unless the employer can show grounds which justify the dismissal. In order to clarify this basic prescription and to make it easier for employees, employers and the adjudicating bodies to fulfil the spirit of the legislation, I have listed the criteria in relation to dismissals.
It will be unfair to dismiss an employee because of trade union membership or trade union activities either outside his hours of work or at times during work hours which are agreed by the employer. Dismissal will also be unfair if it arises from the religious or political opinions of the employee; civil proceedings against the employer which involve the employee as a party or witness; criminal proceedings against the employer which involve the employee as a complainant or witness; and the race or colour of the employee. In addition, where pregnancy is the sole reason for dismissal it will be unfair.
I mentioned that it will be for the employer to demonstrate that the dismissal was justified and he must show that it resulted from one or more of the following or some other substantial grounds justifying the dismissal:
—the employee's capability, competence or qualifications for the work he was employed to do,
—his conduct,
—redundancy, or
—if his employment in his particular job contravened statutory requirements.
An unfairly dismissed employee will, therefore, be entitled to re-engagement in his old job or in a suitable alternative job and the alternative form of redress to re-engagement will be an award of compensation within a maximum of two years' pay.
This redress available in the Bill should act as a deterrent by encouraging employers to think seriously before dismissing a worker— in fact, to ensure that dismissal is a last resort which must be shown to be fully justified. It is in this context that we can be reasonably sure that this legislation will help in reducing the number of instant dismissals—bearing in mind that at present industrial action is often the only practicable resort available to workers in disputed dismissal cases.
The adjudication process envisages three possible stages, involving hearings before a rights commissioner, an Employment Appeals Tribunal, and a final appeal to the Circuit Court. This provides an effective system under which disputes about dismissals would be investigated with a minimum of formality and expense.
I understand that fears have been expressed in some sections of industry that the Bill is biased against management. This is not the case. For the vast majority of managements this Bill need not present problems. I want to make it clear that this legislation will not give protection to employees who are clearly incompetent in their work or whose conduct at work is seriously detrimental to the performance of their job.
I hope that the passing of this Bill will give a further stimulus to the development of agreed disciplinary and dismissal procedures within firms and to their establishment in firms where no such agreed procedures exist. It is accepted by both sides in industry that there should be procedures, with graduated steps and sanctions with due warning, and the dismissal should be the ultimate sanction and applied only in most serious cases.
It is my belief that in addition to procedures at the level of the firm there should also be a national code of agreed disciplinary procedures relating to dismissals. On the enactment of the Bill it is my intention to initiate discussions with representatives of trade unions and employers with a view to agreeing such a national code. This national code should suggest alternatives to dismissal and agree on a graduated scale of sanctions such as reprimands and suspensions, commensurate with perceived shortcomings. The code should also give guidance on appropriate appeals machinery within the firm. The main purpose of this code would consist in the achievement of agreement on both sides on necessary steps in grievance procedure.
There are limited exceptions in section 2 in respect of a few categories of workers. These relate mainly to employees at retiring age, close relatives, persons being trained by AnCO and to persons in public sector employment, many of whom have the benefit of dismissal procedures under other legislation. I am taking power to bring excluded groups within the scope of the legislation if this appears to be desirable at a future time. Section 2 also sets a qualifying period of one year's service with the employer concerned before the Act will apply. I have included an exception to this qualifying service requirement so that a woman dismissed on grounds of pregnancy can appeal even if she has less than 12 months' service.
I considered that it was desirable to clarify in the Bill the position about the termination of fixed term contracts. Broadly speaking, I have provided in subsection (2) of section 2 that a dismissal which represents the expiry of a fixed time contract cannot be disputed under the terms of the legislation. In subsection (3) of the same section, I have proposed provisions to make clear the position of employees working abroad.
The provisions of section 3 recognise the special relationship which exists when an employee is on probation or training and the accepted concept that he has to prove his worth during a trial period. In specifying that the Act will not apply to such a dismissal, I have provided the safeguards that the contract of employment must be in writing and the duration of probation or training must be two years or less and be specified in the contract. Having regard to the rigorous training and tests which must apply for qualification as nurses or for para-medical employment, provision is also made whereby the Act will not apply to a dismissal during the initial training period.
Section 4 continues a concept enshrined in other legislation whereby employers who take on more employees than they require for training as apprentices will not face the possibility of unfair dismissal claims if the worker is dismissed within six months after the apprenticeship begins or within one month of the completion of the apprenticeship. In making this provision, I am anxious not to undermine the practice of some large organisations which take on more apprentices than they would need for their own requirements. These firms are performing a useful function for the benefit of the whole community.
Section 5 deals with dismissals by way of lock-out or for taking part in a strike or other industrial action. I have provided that dismissal by way of lock-out will not be unfair if the employee is offered re-engagement on resumption of work. In the case of strikes or other industrial action, I felt that some protection against victimisation was necessary for employees. In the return-to-work situation, there must be equal treatment for all participants. I have provided that if an individual is picked out for dismissal or if he is not offered his job back along with his colleagues he can claim unfair dismissal.
Section 6 sets out the criteria for unfair dismissal. As I mentioned earlier, it will be unfair to dismiss an employee because of his trade union activities, his religious or political opinions, his failure to be a member of a trade union, unless membership was a prior condition for entering the particular employment; civil or criminal proceedings against the employer which involve the employee and the race or colour of the employee.
I am providing that dismissal will be unfair subject to certain conditions if it results from the pregnancy of the employee. The qualifying limitation of one year's service does not apply to this particular provision. This right is qualified to the extent that dismissal of a pregnant employee is unfair unless she was unable by reason of pregnancy to do her work or her being at work contravened some other legal requirement and the employer could not offer her another suitable vacancy or she refused an offer of suitable alternative employment.
I have provided also in section 6 that unfair selection for redundancy shall be regarded as unfair dismissal. I consider that this provision is very necessary to guard against victimisation of individual workers for other motives in a redundancy situation.
Section 6 provides finally that it will be for the employer to demonstrate that the dismissal was justified and he must show that it resulted either from one or more of the following matters to which I referred earlier or from some other substantial grounds justifying the dismissal:
(a) the employee's capability, competence or qualifications for the work he was employed to do,
(b) his conduct,
(c) redundancy, or
(d) if his employment in his particular job contravened another legal requirement.
I have provided in section 7 that if a dismissal is deemed unfair the employee is entitled to re-engagement in his old job or in a suitable alternative position and the re-engagement can be on the basis that continuity of employment is preserved. The alternative to re-engagement is an award of compensation, subject to a maximum of 104 weeks' pay. In determining the level of compensation account must be taken of the extent to which the employer or employee was responsible and of other guidelines, including the extent to which the employer or employee abided by negotiated dismissal arrangements or complied with the code of practice relating to dismissal procedures approved by me and to which I referred earlier. Further recognition of negotiated dismissal procedures is given in section 14, to which I will refer later. I am taking specific power in section 7 to approve a general code of practice relating to dismissal procedures which could be a guideline to all employers and employees.
In sections 8 to 10, inclusive, I set out the proposals for adjudication on claims of unfair dismissal. While these may seem a little complicated, I intend to produce literature when the Bill becomes law which will leave employees and employers in no doubt about the procedures they should follow. I will ensure that the information literature will receive the widest possible circulation. The adjudication process envisages three possible stages, involving a rights commissioner, the Redundancy Appeals Tribunal, which is being renamed the Employment Appeals Tribunal under section 18, and a final appeal to the civil courts.
As Deputies will know, the rights commissioners service operates on a voluntary basis under the Industrial Relations Act, 1969, in areas of dispute which are not connected with pay or general employment conditions. The Redundancy Appeals Tribunal deal at present with minimum notice and redundancy dismissal disputes and my decision to assign unfair dismissal cases to the tribunal achieves a unity of subject matter relating to dismissals for adjudication purposes. I feel that the tribunal are the appropriate forum if dismissal disputes are to be removed from the area of industrial disputes. The third stage of final appeal to the civil courts is necessary in order to integrate the proposals with the existing legal system.
Section 8 provides therefore that a claim for redress for unfair dismissal must be initiated by an employee within six months of dismissal by giving a written notice to a rights commissioner—or to the tribunal if the employee objects to a hearing by a rights commissioner. Either party may object to a claim being heard by a rights commissioner. In cases which come before him, however, the rights commissioner will make a recommendation in relation to a claim. If that recommendation is not carried out the employee may bring his claim to the tribunal which will make a determination in relation to the claim. I should mention here that there is separate provision in section 9 enabling either an employee or an employer to appeal to the tribunal against the terms of a recommendation of a rights commissioner within six weeks of the date of the recommendation. The tribunal will make determinations on all claims which come before it.
Section 10 introduces the third stage in the adjudication process, whereby if an employer fails within six weeks to carry out a determination of the tribunal, the Minister may institute Circuit Court proceedings on behalf of the employee for the remedies provided in the Act. The Minister will pay any costs imposed on him by the court. This section also provides that either an employee or an employer can on their own initiative appeal to the Circuit Court against the terms of a determination of the tribunal but in these cases the Minister would not be liable to pay costs.
On the question of costs, I should like to stress that other than any travel or subsistence costs which may arise no costs necessarily arise for either the employer or employee in the first two stages of the adjudication process. It is open to either the employer or the employee, at their own cost, to be legally or otherwise represented before the tribunal but it is not necessary and in fact, a very limited number of cases now coming before the tribunal involve legal representation. As I have said earlier, the only case under this Bill in which the State can bear an employee's legal expenses will be when an employer fails to carry out a determination of the tribunal; the Minister then takes the case to the civil courts on the employee's behalf and the courts might award costs against the Minister.
Section 11 is a standard provision to facilitate the service of documents on corporate and unincorporated bodies in connection with proceedings under the legislation.
Section 12 accords priority status to compensation payable under the legislation in the winding up of companies or in bankruptcy.
Section 13 contains the standard provisions which prevent employers from avoiding the provisions of the Act.
In section 14, I give special recognition to the existence of negotiated dismissal agreements and require employers to give written details of such dismissal procedures to employees within 28 days of taking up employment. Similarly, any alteration in these procedures must also be notified in writing within a 28 day period. These requirements will, of course, be satisfied if the procedures are incorporated, for instance, in a staff manual which is handed to each worker immediately on taking up employment. I am also providing in this section, that where an employee is dismissed, the employer must, if he is requested to do so, give written particulars of the grounds for the dismissal to the employee within a 14 day period. There is a qualification to this in that any other substantial grounds, which would have justified the dismissal, may be taken into account by the adjudicating bodies when considering claims under this legislation.
At present the only legal recourse available to a dismissed employee is a common law action for wrongful dismissal. That right of action is preserved under section 15. In making available the simple and effective system of adjudication and redress under the Bill and in committing taxpayers' money to their operation, I consider that the employee can reasonably be required to choose between a common law action or a claim under this legislation. I have provided for such choice in this section.
I am taking power in section 16, subject to affirmative resolution of each House of the Oireachtas to amend certain provisions of the legislation, such as the extension of the Act to any of those people excluded under section 2, variation of the maximum amount of compensation of two years' pay and amendment of the Act so as to comply with any international obligations in relation to dismissals which the State decides to assume.
I commend the Bill to the House and look forward to its passage.