Worker Participation (State Enterprises) Bill, 1976: Report Stage.

I observe that amendments Nos. 1, 2 and 3 are related and I suggest that they be debated together.

Will there be a specific explanation for each?

I move amendment No. 1: In page 3, between lines 20 and 21, to insert the following: "‘Aer Lingus', except in the Schedule to this Act, means Aer Lingus Teoranta; ‘Aerlínte' means Aerlínte Éireann Teoranta;"

This amendment deals with a problem that we dealt with on the Committee Stage of bringing Aerlínte in. The Deputy will recall that there is a close connection between Aer Lingus and Aerlínte. All of these amendments were necessary in view of the requirements that Aerlínte employees should be able to participate.

While not opposing this amendment, I presume that I will have the opportunity of speaking on the three amendments once only on the ruling of the Chair.

That is the procedure on Report Stage.

It is only right that the Minister explain clearly to the House the necessity, for example, for amendment No. 1. Referring to page 3 of the Bill we are inserting here a new interpretation and we are saying according to the amendment, "‘Aer Lingus', except in the Schedule to this Act, means Aer Lingus Teoranta;". I merely want the matter clarified. I have no objection to this if the people drafting the Bill feel it is necessary but it has to be explained clearly why "‘Aer Lingus', except in the Schedule to this Act, means Aer Lingus Teoranta". Obviously in the Schedule it means Aer Lingus Teoranta as being one of the companies chosen. Why do we refer to the necessity for changing from Aer Lingus Teoranta to merely Aer Lingus in other parts of the Bill? I take into consideration the inclusion of Aerlínte but I cannot understand why this necessity should arise. I presume the Minister in his reply will explain why this drafting change is necessary. It is certain that, if I were putting in amendments to this Bill and I did not give a clear and absolute explanation of the necessity for such amendments, then he would be very critical of my performance here and I would agree with him.

Going on to the second amendment and again to page 3 of the Bill at line 41 we add: "and for the purposes of sections 9 (4) (w) and 10 of this Act a person employed in such a capacity by Aerlínte under such a contract shall be regarded as being an employee of Aer Lingus;" ...

We are really adding there to the interpretation again and I understand why an employee of Aerlínte must get the opportunity of being involved in the worker participation being prepared under this Bill, but I cannot understand why the draftsman should have used this sort of interpretation of the Act. I submit that it is not in accordance with fact and it could be regarded as being distortion of fact.

I realise what they are trying to do but they have gone the wrong way about it. It says that for the purposes of sections of this Act a person employed in such a capacity by Aerlínte —in other words an employee of Aerlínte—under such a contract shall be regarded as being an employee of Aer Lingus. Surely that is a contradiction in terms. I see what they are trying to achieve. What they are trying to say of course is that these people in Aerlínte will have the opportunity of taking part in the selection process, the election process and the nominating process with regard to the Worker Participation Bill. I would encourage the Minister before it goes to the Seanad to see if this is the correct interpretation. This sort of amendment is not the way to approach it. I would suggest that he refer it back to his draftsmen for a more lucid and clear interpretation of how to involve Aerlínte personnel with Aer Lingus. As regards the purpose I have no objection to it because all it does is give the opportunity to the people working in Aerlínte to become part and parcel of worker participation within Aer Lingus or Aer Lingus Teoranta, whichever title you may wish to use. A simple interpretation such as that would appear to me to be more in accordance with the facts. If this is read out of context it gives a completely different picture of the situation.

Amendment No. 3 is closely related to amendment No. 1. I want a clear explanation of this amendment. In the Schedule, Aerlínte Éireann Teoranta is mentioned. Why are we deleting the word "Teoranta" in section 2? We are talking about the appropriate Minister responsible for the designated company. Paragraph (iv) of the section reads:

...with regard to Aer Lingus Teoranta and the British and Irish Steam Packet Company Limited, the Minister for Transport and Power ...

Why are we omitting the word "Teoranta" from section 2 and keeping it in the Schedule? I want a clear and lucid explanation as to why this is necessary. It may be necessary. I have no objection to doing it. Are we just playing around with words? Are we trying to project the image that we are amending the Bill? At least two of these amendments mean absolutely nothing at all.

We came to the conclusion that to include Aerlínte employees it would be necessary to make amendments Nos. 1, 2 and 3. On Committee Stage we moved amendments to enable Aerlínte employees to vote in Aer Lingus elections as provided in the Bill. At that time I drew the attention of the House to the need which would arise to draft some minor consequential amendments to sections 1 and 2 on Report Stage. I emphasise the fact that they are minor drafting amendments.

The Deputy referred to the apparent inconsistency of mentioning Aer Lingus Teoranta in the Schedule and Aer Lingus elsewhere. In the Schedule we must refer to the designated bodies by their full formal titles. There is no significance other than that. We are forced to include the full rather heavier title of the designated bodies in the Schedule.

Amendment agreed to.

I move amendment No. 2:

In page 3, line 41, to add "and for the purposes of sections 9 (4) (w) and 10 of this Act a person employed in such a capacity by Aerlínte under such a contract shall be regarded as being an employee of Aer Lingus;" to the definition of "employee".

Amendment agreed to.

I move amendment No. 3:

In page 4, to delete "Teoranta" from line 40.

Amendment agreed to.

I move amendment No. 4:

In page 5, to insert "both competent to perform the functions of returning officer and" before "acceptable" in line 40.

This amendment is intended to meet one of the points made by Deputy Fitzgerald on Committee Stage. We are providing that where a person is nominated by the company secretary to act as returning officer, in the secretary's opinion he should be fully capable of discharging the duties of the returning officer.

This amendment goes a little way towards meeting my request on Committee Stage for what I thought would improve the section and make it fairer. This is a step in the right direction and I welcome it because it removes any doubt which could have arisen with regard to the appointment of an officer. Section 7 (b) provides: "in lieu of such secretary or officer, any other person who in the opinion of such secretary or officer is acceptable to" trade unions, nominating bodies, and so on. His competency or suitability does not arise.

In this amendment the Minister has gone part of the way in that regard. We are inserting the words "both competent to perform the functions of returning officer and". Under section 7 the person appointed in lieu of such secretary or officer must be competent to perform the functions of a returning officer and acceptable to a group of people. I will have something to say on the next amendment about the group of people concerned. I welcome this amendment. I claim a certain amount of kudos for having pushed the Minister on the point. I am sorry he did not go further and do what I suggest he should do in amendment No. 4a.

Amendment agreed to.

I move amendment No. 4a:

In page 5, to delete lines 41 to 50, and substitute "a majority of the employees of the body".

It may save time if I give my explanation and then the Deputy can comment on it. The Deputy may recall that on Committee Stage there was the question of an alternative to the returning officer, a substitute returning officer who should be acceptable also to the majority of the employees. We could not come up with any satisfactory procedure which would ensure acceptability to the majority of the employees without going through the cumbersome procedure of a ballot. This would be a cumbersome arrangement in the rather rare circumstances in which this would be required. We are providing that the substitute returning officer must be acceptable to the nominating bodies, that is, the negotiating bodies recognised for this purpose which either individually or collectively represent a majority of the employees in the company. This achieves what Deputy Fitzgerald has in mind without the delay and the extra cost which would be involved in going through a ballot procedure.

I am glad the Minister is expressing the same concern about the section as I am. I firmly believe worker participation must mean workers within the protected company. The less interference from outside bodies the better. I have always supported the idea that there should be trade union support for it. Trade union support is essential and vital to the success of worker democracy. It cannot survive without the assistance of the trade union movement. Here we are appointing a returning officer to handle the election, or a substitute for him. In the case of the Dáil or local elections in our constituencies it is not a condition of appointment of a returning officer that he be acceptable to the political parties. Perhaps that is just as well as it might result in wrangling. If the secretary, who is regarded as a responsible officer, nominates somebody whom he belives is competent and suitable to perform the functions of returning officer and is acceptable to the workers that should be satisfactory. I am still not content; the Minister quoted a figure of 5 per cent of the employees of the State bodies we are concerned with who are not trade union members or members of staff associations; I said it was higher, but even taking his 5 per cent, in effect under this legislation we are depriving that 5 per cent of ever having an opportunity of being nominated to these boards, in other words denying them their rights as citizens working in the State enterprises concerned.

I do not want to have this worker participation held up or retarded by people quibbling over trivialities such as the colour of a man's eyes when he is appointed as returning officer or some other reason why some group of people in the nominating bodies will not accept him. I see the Minister's problem—how to get a majority of the employees. The union or a number of unions or a number of nominating bodies must be consulted and one or more may disagree with an appointment and say the candidate is not suitable and an alternative may be appointed. Again, one or two more may object to him and, as I see it under the Bill, they are quite within their rights in doing so. You may be dealing with people who, although essentially connected with the company are, in effect, working outside it. I think worker participation must be kept under the aegis of the company as far as possible to ensure that it works as we want it to work. The Bill has sufficient shortcomings without denying the workers a say here.

The Bill will be going through the Seanad and I ask the Minister to consider inserting something to the effect that unless a certain number or percentage of the employees of the company object to such an appointment it shall be made. I should prefer to see this as a decision of the employees rather than a decision of the nominating bodies or outside bodies because a returning officer is appointed not to look after the interests of the nominating bodies but the interests of the people voting, the electorate who are the workers in that company. We must be mainly concerned with these people in this legislation and confine it to them as far as possible. I do not believe the Minister is right in giving this power to nominating bodies or trade unions to disapprove of the appointment of a returning officer. I believe the workers in the company should decide this and if a certain number or percentage of them do not agree with the appointment I think that is the only thing that should be considered by the Minister. I want the Bill to work and to help the Minister to ensure that it works and I want as little interference as possible from outside in the introduction of worker democracy in the companies we are discussing. Therefore, I ask the Minister to reconsider this matter between now and Report Stage.

Is it in order for me to speak again?

Further speeches would not be in order but the Chair will consider an exchange of views by way of question and answer as being permissible.

We shall certainly have a look at this provision again before it is dealt with in the Seanad.

Very well. On that basis I will withdraw my amendment.

Amendment, by leave, withdrawn.

I move amendment No. 5:

In page 6, to delete lines 28 to 30 and substitute the following:

"only after consultation with,

(a) the Minister of State or every Minister of State, as may be appropriate, who as regards a designated body to which the regulations are to apply is the appropriate Minister, and

(b) the designated body or every designated body, as may be appropriate, to which the regulations are to apply".

On section 9, Deputy Fitzgerald suggested that it might be amended to enable designated bodies to make regulations after consulting the nominating bodies and having also taken into account the problem of the geographical spread of the enterprise and then have the regulations approved by me. As I have already said, under the Act concerned with these regulations, the Statutory Instruments Act, 1947, regulations like these must be executed by the Government or somebody acting on behalf of the Government, Government Ministers, and in this case it will be the person holding the portfolio of Labour. The precise procedures and arrangements about elections will in practice be determined on the basis of consultations with the social partners, management and union in the enterprise concerned and, while the Bill cannot specifically provide for this for reasons already mentioned, the Deputy may be assured that in practical terms this is in fact how the regulations will be drawn up, after effective consultation with the bodies, management and unions and staff associations representing workers.

We share common ground on the need for prior consultation and to make the idea more explicit in the Bill I am putting forward an amendment to section 9 (2) which requires that in addition to consulting the appropriate Minister as originally provided for, consultations must also take place with the designated bodies. In fact this would have happened but it is now more explicit. This amendment should make the intention quite clear without having to incorporate elaborate provisions about the precise method of consulation which would add unnecessary complication to a Bill which is necessarily complicated enough as it stands.

I now ask Deputy Fitzgerald to move his amendment to the Minister's amendment which appears on the Order Paper.

Does that mean I must speak on both together?

Yes. Yours is an amendment to the Minister's amendment, so we must debate them together.

I move amendment No. 1 to amendment No. 5:

To add the following:

"(c) the nominating groups:

and when making regulations under this section the Minister shall take into consideration the geographical spread of a designated body to which the regulations are to apply."

I have no objection to amendment No. 5 which does not go as far as I want. The Minister might charge me with inconsistency here because of the previous amendment but I am particularly concerned about some of these companies, especially those with a large geographical spread and probably an imbalance of workers. CIE employ a large number of people in the Dublin area and they have many depots throughout rural Ireland. Bord na Móna are spread over many counties. The ESB have many different departments and geographical locations. We have not been told how many worker-directors will be on the boards. We know there will be a third of a particular number but under the Bill the Ministers concerned will have power to alter the number of State directors on the boards of those companies. All these companies have seven directors but Cómhlucht Siúicre Éireann have nine. That is a good company to take as an example.

Assuming membership of that board stays at nine, three members will be elected by the workers of that company. There are four beet processing factories and a number of food plants. Understandably, the number of employees in all these plants varies. My amendment adds "(c) the nominating groups". I inserted that because in the case of the Sugar Company there are four processing plants but only three directors, unless the Minister decides to increase the number of directors to 12. I would not support that because, first, it would be an added charge on the company and, secondly, some of his colleagues in Government might be tempted to make appointments to the other two-thirds in appreciation for services rendered. This is happening more openly and more regularly as days go by.

Unless we organise the elections properly it could happen that all three directors could come from one area. This would be very undesirable. The problems would be greater in the ESB and CIE because of the spread. Of necessity we cannot give every major CIE or ESB geographical location representation on the boards. It would be very desirable if this could be done but obviously it is not possible. The two-tier system appears the more desirable.

The Minister has a major problem ensuring the workers will be content that the persons concerned were elected to represent the different geographical locations. It would be disastrous if the three appointments came from the same area, say, Dublin. I have no objection to their being Dublin-based, but what worries me is that there would not be a proper spread. It could equally be argued that all three should not be from the rail, road or freight sections, irrespective of geographical locations. Therefore, not only the geographical spread should be taken into consideration but also the particular sections.

We all want to see this Bill work properly and the more consultation there is the better. Therefore, I strongly urge the Minister to accept my amendment. As I said, he could charge me that this is a contradiction with my previous amendment but there is a vast difference here. I believe the first election will be very important. We all want to see this work properly but to some extent we are all going into the unknown. For this reason I believe the more consultation there is and the more information that is given to the employees the better, because the appointment of these worker-directors must be and must appear to be as democratic as possible.

I cannot see why there should not be consultation. The Minister has the final say, and rightly so. Only by consultation can there be any hope that the workers will be satisfied with the final results. This is very important and again I ask the Minister to accept my amendment.

The Minister has pledged himself to consult people. Other members of his Government promised that too, but they broke their promises years ago. I would regard this move as an innovation in conditions of employment. This legislation must succeed; it cannot afford not to. Any kind of failure will do harm to further extension. I hope we are not too far away from the opportunity to extend meaningful worker democracy. Any setback or failure, even in this limited Bill, can only mean that in the future people will be suspicious. For that reason I urge the Minister that consultation is absolutely essential to it. There may be drafting problems but they can be overcome. A mistake in drafting will not hinder or help worker participation but lack of involvement of people can certainly harm it. I strongly urge the Minister to accept at least the spirit of the amendment. If he wants to change the wording of it I have no objection. I believe it is essential that the Minister should not only consult but should be seen to consult. It is the first step on the road to worker democracy but it must be a solid successful step with complete involvement of the people whose lives it will affect.

We have already covered the general need for consultation. We are all agreed that the worker directors should represent as adequately as possible the interests of their constituents, the workers who elected them, and it would be best to see them elected in the fairest poll possible. In a company which is geographically dispersed the worker directors should understand and sympathise with the regional pattern of the employees. That is the ideal situation. It is difficult, however, to specify this in the Bill itself. There is no disagreement in this objective and I am confident that there will be a happy blend between regional interests and the democratic poll.

Difficulties could arise if I were to accept this amendment. A phrase like "taking into consideration the geographical spread of a designated body" could possibly lead to a legal tangle. Let us take, for example, a company like Aer Lingus which at any one time might have over 100 workers in the United States. It could be claimed that such workers would have to be represented on the board irrespective of how the 5,000 home-based employees are represented. Could it mean that all overseas employees in the United Kingdom, Europe or elsewhere must be collectively represented and then on what basis? This gives some indication of the possible interpretations of an amendment of this nature. It is open to a variety of interpretations and it could be held that it would represent a certain conflict with such major principles of the Bill as outlined in section 9 (3) which states that the poll must be taken according to the supreme principle of proportional representation. The adoption of other criteria might possibly interfere with this principle. In certain circumstances the necessity to base representation on geographical criteria could mean that the principle of the majority numbers in the selection of worker-directors would be set aside. It could be claimed that small groups should be given greater weight in the election process. In the light of these practical difficulties which undoubtedly exist and which could be a potential source of friction, I hope the Deputy will agree that the Provisions in section 9 (2) as amended offer the most flexible and acceptable basis whereby consultations can take place with the nominating bodies without the risk of generating friction or endangering the principles of proportional representation, the most important requirement of elections.

Would the Minister accept the spirit and the principle of the amendment, even though the wording might be difficult?

I would hope in the actual consultations that we would find informal arrangements achieving the same result. I think that will be the case.

Let us suppose that before the Bill went into operation the Minister had a successor. He might not be inclined to consult. Could his hands be tied so that he would have to consult?

He will have to consult. The actual form in the regulations requires consultation.

Let us legislate so that he has no other way out.

In general in a Bill of this kind it is better to leave the regulations to evolve from the consultations themselves. The geographic question of representing people in the regions will have to be catered for in practical consultations.

There may be divisions within the company as well. In the case of CIE there is the railway division, the freight division and so on.

I accept the ideal point but I must point out the practical difficulties.

Let the Minister accept the principle and see what can be done with it.

Amendment to amendment No. 5, by leave, withdrawn.
Amendment No. 5 agreed to.

I move amendment No. 6:

In page 15, lines 10 and 11, to delete "before making the appointment, have regard to that poll" and substitute "appoint the first candidate in the poll who was not deemed to be elected".

There is a glaring case for accepting the amendment as I have outlined it. I am trying to safeguard the Minister himself. We are talking now about the powers of the Minister in replacing a person who may have died or resigned or departed from the board to which he was elected by the workers. How is that worker to be replaced? There is only one fair way in which this can be done. Section 22 (2) states:

In appointing a person to fill a casual vacancy, the appropriate Minister shall, in case there was a poll at the last preceding election relating to the designated body concerned, before making the appointment, have regard to that poll.

I do not think that this is strong enough. I want to protect the Minister here and, indeed, protect him from his colleagues in the Government. They may see the weakness there and try to get their hands on the loot. One of the Minister's colleagues could look for the job for his right-hand man. It could well be the Taoiseach. We have seen it happen only last week or the week before. The first candidate in the poll who was not deemed to be elected should be appointed. If three directors were elected the fourth person in the poll would be the obvious choice.

I probably should have gone a little further in my amendment and said "the first or next person". The fourth person in the poll might be unavailable or at that stage could say that he or she is no longer interested in serving as a member of the board and is no longer interested in going forward. The Minister could then go on to the person who was second in the poll after the three members originally appointed. It is important, for the Minister's sake and for the sake of any successor who may follow him, that he leave his options open in this case.

There could be repercussions if the Minister does not do what I suggest. Those of us who have worked in industry and factories know the petty little differences that can arise, some of which may be imaginary. Great discontent could be caused in a company if there is not a specific way of appointing the person next in line. When one has regard to the poll it means that the Minister must take this into consideration but he need not necessarily appoint the person next in line. We have a substitute in the wings, if my amendment is accepted, waiting to move in as a member of the board or a director of the company if by chance a vacancy arises.

I urge the Minister to get rid of the terrible image the Coalition have created for themselves, the "jobs for the boys" situation, which has worsened in recent weeks as we approach a general election. I urge him to seal the gap and prevent any of his pirating colleagues from ferreting out that position for one of their friends. I believe the person who is next in the poll is entitled to have that place. If that person is not available or decides not to take the position then the person next in line in that poll is the natural substitute. I pressed the Minister hard about this on Committee Stage. I did not want to divide the House then nor do I want to do it this morning if I can avoid it.

It is important that the Minister sees that we are appointing one substitute after another and that once the elections have been held, provided the person next in line is still in the company and interested in taking the position that person should be appointed. There should be no loopholes whereby a Minister could get away from this. If such a loophole is used in one of those companies it will sound the death-knell of any progress in worker participation.

There are not any objections in relation to the principle of seeing that the person who enjoys most support, the one that common sense would suggest and whom the nominating bodies would support, is the person to fill the vacancy that will arise. We are up against a familiar difficulty in legislation of this kind that if we try to spell out in detail points in this general principle we may end up in greater difficulty and we may not be serving the general interest of most effective representation in the circumstances which these sections deal with.

There is a suggestion by Deputy Fitzgerald that the highest placed of the unsuccessful candidates must automatically be appointed to fill a casual vacancy. That was my original intention but in the course of consultations with bodies concerned it was decided to omit that stipulation from the Bill. If we were to agree that a rota system would operate it could be expected that the replacement in the event of a casual vacancy would expect to be drawn from a group or sector whose turn it was to be represented on the board. Such a replacement might not in fact be the highest placed in the poll. Nevertheless, if we were tied to the automatic selection of the highest placed, regardless of other considerations, it would upset the rota scheme which Deputy Fitzgerald, I thought quite rightly, earlier in this Bill, recommended as a suitable system in certain circumstances. If the highest placed was automatically to fill casual vacancies we could see, from what we know already from discussions with them, the kind of rota system that will be operated in the B & I between the seagoing and shore employees. We could see practical difficulties impeding the successful implementation of this rota system if one had to be tied automatically to the principle that the highest placed had to fill casual vacancies.

I feel—I hope the Deputy will agree with me—that unless a prescriptive formula is preferable, while adhering to the general ideas expressed by the Deputy, with which I am in agreement, we must be afforded here, for practical implementation, flexibility for the nominating bodies—the entire success of this Bill depends on their agreement—so that the rota system, where it operates, may not be upset by insisting that a particular process must be adhered to in every detail in the event of a casual vacancy. There is a very important principle at work here. All sides are anxious to ensure that even in the matter of casual vacancies the right thing is done and the most effective representation is maintained.

I take the point made by the Minister regarding the reference to the B & I. The same would apply. I should like if the Minister could give me the official interpretation for what is meant by having regard to the poll. If having regard to the poll means that the Minister may not go outside those people who contested that election I am reasonably happy. I want to avoid someone being pushed in as a director who may not have in any way participated in the previous election. If I can get an assurance of the official interpretation of what is intended in the language of this legislation by the words "having regard to that poll" I would be prepared to consider withdrawing the amendment.

I might intervene to assist the Deputy. "Having regard to that poll" would mean that in an election situation with a vacancy arising I would, obviously, have to say in practical terms that the next highest person must fill any ensuing vacancy. However, where other systems might operate, such as the rota system, I would still have to have regard to the poll but it is possible that in consultation with the nominating bodies that something different might be done. In my view it is tight enough but I have a flexibility.

I am prepared to withdraw the amendment but I ask the Minister to have a look at it before he introduces the Bill in the Seanad. I do not want this provision abused; I do not want a person who has had no involvement in previous elections lifted into this position. I want to ensure that nobody has this opportunity.

Amendment, by leave, withdrawn.
Bill, as amended, received for final consideration.
Agreed to take remaining Stage today.