Amendment No. 1 has been ruled out of order.
Redundancy Payments Bill, 1979: Committee Stage.
SECTION 1.
I move amendment No. 2:
In page 2, between lines 11 and 12, to insert:
"‘place' in Part II of the Principal Act in relation to a person employed in the construction industry as defined in the Employment Agreement for that industry registered at the Labour Court means the actual place, location or site where the employee is employed, unless otherwise specified in a written contract of employment or in a written statement of terms of employment furnished under section 9 of the Act of 1973 if, but only if, a change or proposed change in the place of employment would be significantly to the disadvantage of the employee.".
I have included this amendment because I considered it a vital one to enable the legislation to be applied effectively, in particular to one large section of our workers, namely, men employed in the construction industry. This group is liable to be located in any part of the country at any time of the year. I believe my amendment must be included to ensure that these people are compensated properly and also to ensure that they will qualify for redundancy under this Bill. This is essential if we are to be seen to be concerned for all workers.
I must oppose this amendment. By their nature some employments involve movement from one location to another and to discourage such movement could have very serious consequences for such type of employments and could affect the economic capacity of the country.
Apart from this, if anything were to be done it would have to be done for all employees. We could not discriminate in the case of building workers, as the Deputy has requested. Basically, the Deputy is saying that those workers, working for a period on a site and then moving to another site, even with the same employer, should be entitled to redundancy payments. I know something about the construction industry and I think it would create a ridiculous situation if an employee or a group of employees, perhaps spending a lifetime with the same building firm while moving to different locations, could have redundancy entitlement. It would be an impossible situation.
In addition, it could be regarded as discriminatory in itself to select those workers because there are other types of employment where people are obliged to move to different locations in certain circumstances. It is impossible for me to accept the Deputy's amendment.
Amendment, by leave, withdrawn.
Section 1 agreed to.
SECTION 2.
Amendment No. 3 in the name of Deputy Ryan has been ruled out of order.
I move amendment No. 4:
In page 2, before section 2, to insert the following new section:
"2.—The following paragraph is hereby inserted in section 7 (2) of the Principal Act (as amended by the Act of 1971):
‘(d) the fact that the employer has decided that the work for which the employee has been employed (or had been doing before his dismissal) shall henceforth be done by a person who has a degree of capability, competence or qualifications (specified by the employer) which the dismissed employee did not have'."
This is purely a technical amendment and in my opinion it is justified. It enables a dismissed employee to be compensated. There has been a previous example of this in the Department of Education where an unqualified teacher was dismissed and was replaced by a qualified teacher. This amendment would widen the scope of redundancy and I should like to hear the Minister's comments on this matter.
This refers to a particular controversial decision. I am sorry I must oppose the amendment for a number of valid reasons that I shall point out.
In the first instance, it is not good legislation just to legislate for one case or for one example. In addition, a decision was taken in a particular case. I do not think that could guarantee what would be the result of any decision in a similar case in the future. In other words, the tribunal at any stage obviously would take into account the merits of a particular case. To accept this amendment basically would be to legislate for one controversial decision. Obviously, I cannot comment on the correctness or otherwise of that decision. The Bill is well worded now and it should not be tampered with because of that one isolated case. It could well be that the tribunal, in similar circumstances, could arrive at a different decision from that arrived at in the case mentioned by the Deputy.
The amendment, as worded, could lead to a number of abuses of the scheme by people claiming redundancy because they were replaced by more capable workers. It could be very difficult to define capability or competence in such a situation. Acceptance of the amendment could lead to a number of abuses. It arises only because of one case to which the Deputy has referred.
Amendment, by leave, withdrawn.
Section agreed to.
SECTION 3.
I move amendment No. 5:
In page 2, line 35, to delete "Section" and substitute "Sections".
This is a simple drafting amendment. I do not think it presents any difficulty.
Amendment agreed to.
Section 3, as amended, agreed to.
SECTION 4.
I move amendment No. 6:
In page 3, lines 19 and 20, to delete "paragraph after paragraph 1" and substitute "paragraph for paragraphs 1 and 2:
‘AMOUNT OF LUMP SUM
1. The amount of the lump sum shall be equivalent to the aggregate of the following—
(a) the product of one-half of the employee's normal weekly remuneration and the number of years of continuous employment, with the employer in whose employment he was on the date of dismissal or by whom he was employed when he gave notice of intention to claim under section 12; between the date on which the employee attained the age of 16 years and the date on which he attained the age of 21 years.
(b) the product of the employee's normal weekly remuneration on the date of his dismissal and the number of years of continuous employment, with the employer in whose employment he was on the date of dismissal, or by whom he was employed when he gave notice of intention to claim under section 12 between the date on which the employee attained the age of 21 years and the date on which he attained the age of 41 years, and
(c) the product of one and a half times the employee's normal weekly remuneration on the date of his dismissal and the number of years of continuous employment, with the employer in whose employment he was on the date of dismissal, or by whom he was employed when he gave notice of intention to claim under section 12, after the employee had attained the age of 41 years.
Provided that the minimum lump sum shall not be less than twice the employee's normal weekly remuneration'."
If accepted, this amendment would bring our lump sum benefit calculations into line with those obtaining in Northern Ireland. From the age of 16 years to 21 years a person would be entitled to one-half weekly wages for each year, from 21 years to 41 years he would be entitled to one week's wages for each year of service, and over 41 years he would be entitled to one and a half weeks' wages for each year of service. I am not happy that the sum of £5,000 is sufficient and I have inserted a figure of £9,000. The ceiling is much too low and £5,000 would not meet present day needs.
As the House is aware, this section puts a ceiling of £5,000 on the earning to be used in calculating lump sums. The pay on which redundancy payments are calculated is normal weekly remuneration as defined in the Bill. It is broadly an average gross pay including such things as overtime, commission, other payments, and so on, even payments in kind. The Deputy referred to the amount of the lump sum and how it is calculated. He also referred to the figure of £5,000. This point has been made to me already. We are removing the weekly payments and now providing a lump sum. We are not sure what the demands will be over a period of a year. Quite a number of different issues affect the fund, such as the numbers and the service of those becoming redundant. At the end of a period of its operation I have undertaken to review the calculation of the lump sum. This might be the wisest way to look at it rather than going into the unknown and possibly running the fund into serious difficulties. It would be advisable to look at it again after it has been in operation for a year.
The Minister will review the situation after 12 months?
Yes.
I accept that.
On the section and the amendment——
We will deal with the section when we have disposed of the amendments.
Does the Minister intend to increase the £5,000 to £5,500 in line with the change in the social welfare figure?
There is a difference. On the question of social welfare we are talking about the contributions side. It would be wrong to latch this completely on to social welfare. Any decision taken on the redundancy lump sum should be specifically a matter for the redundancy fund itself and for the Department and Minister responsible. The Minister has discretionary powers to make changes by way of regulation as the necessity arises. At the moment it is my intention to let the figure of £5,000 stand.
Amendment, by leave, withdrawn.
Amendment No. 8 is consequential on amendment No. 7 and both may be discussed together.
I move amendment No. 7:
In page 3, subsection (1), line 22, to delete "£5,000", and substitute "£9,000".
These amendments are combining previous legislation with Government amendments and introducing a comprehensive section to deal with time limits on claims. I do not believe there is anything controversial in them.
Amendment No. 7 proposes to substitute £9,000 for £5,000.
I have already spoken about the £9,000 and the Minister has guaranteed that after 12 months he will report back to us.
Amendment, by leave, withdrawn.
Amendment No. 8 not moved.
I move amendment No. 9:
In page 3, after line 30, to insert a new subsection as follows:
"(3) When making regulations under subsection (2), the Minister shall take into account any changes in the average earnings of workers in the transportable goods industries as recorded by the Central Statistics Office since the date by reference to which the sum specified in subsection (1) of this section was last determined."
This is the point I was making. I do not think there is anything controversial in the amendment and I hope the Minister will accept it.
I should like to support this amendment. There would be more confidence in the whole scheme if it were accepted by the Minister.
I am not unsympathetic to the point. I would ask the Deputy to withdraw the amendment and, without giving any guarantee, I will have another look at it between now and Report Stage with a view to seeing whether I could accede to the Deputy's request.
I accept that.
Amendment, by leave, withdrawn.
I move amendment No. 10:
In page 3, lines 37 and 38, to delete "and anything in" and substitute "but subject to".
This is a drafting amendment. The original wording of subsection (3) (b) is, "Notwithstanding paragraph (a) of this subsection and anything in section (8) of this Act...". I am proposing to change "and anything in" to "but subject to". It is purely a drafting amendment and should not cause any difficulty.
What effect has the difference in wording?
This is necessary for the purpose of preserving the calculation basis of the weekly payment entitlement of the redundant employee who, as a current recipient of such payments under section 8, will continue to receive them after the commencement date of this Bill. The working of section 4 (3) (b) as it stands would exclude the provisions of section 8 and the advice is that this amendment is necessary to ensure that section 8 shall apply to current recipients, in other words to ensure that current recipients will not suffer because of the wording in the Bill.
Amendment agreed to.
Section 4, as amended, agreed to.
SECTION 5.
Amendments Nos. 11 and 12 are related and may be discussed together.
I move amendment No. 11:
In page 3, line 47, after "date is" to insert "2 years greater than".
In general where there are sharp cut-off points this gives rise to questions of injustice not only in redundancy payments but in many other areas such as medical cards and so on. In other areas of the public service many of these matters have been corrected. It could happen that a man who was a week or two short of his 66th birthday would qualify for the full lump sum while, if he were one day past his 66th birthday, he would not qualify for anything, as I understand it. I am trying to provide for a phasing-out situation and to allow for a change in the pensionable age. A person who would otherwise qualify for a lump sum would get 50 per cent of the figure and in the second year of pensionable age he would get 25 per cent. In his third year of pensionable age he would get nothing. We propose to provide that in the third year he gets nothing but in the first and second years he would get 50 per cent and 25 per cent respectively. I do not mind if the years are changed about a bit but I should like the Minister to consider my suggestion.
I am sorry to have to say to Deputy Mitchell that I have to oppose these two amendments for a number of reasons. The provision of 50 per cent and 25 per cent would complicate something we are all endeavouring to simplify. Obviously, that would not be the overriding or governing factor if hardships were created or if there were a need to overcome some difficulty. I am pointing out that it would introduce some of the varied percentages that we are trying to eliminate and would cause administrative difficulties. The overriding factor is the proposal to drop the qualifying age for redundancy from 70 to the old age pension age was discussed with both sides of industry. There were no objections but both sides suggested a phased reduction. The reduction that I have introduced affords a reasonable period in which both employers and employees can adjust to the new age limit, because the operative date in the case of those people is 6 April 1980. In other words, there is a further year from 6 April this year. The postponement of the reduction for that one year affords a reasonable period.
I appreciate the point the Deputy is making but I think that the section as it now stands meets his point. To go further would only complicate matters and is regarded as unnecessary.
I accept that the Minister has problems in regard to simplification. We ought to be trying to further simplify redundancy legislation. It should not be too complicated to divide by two and by four in the few cases that will arise. It is bad law to provide for a situation in which a sense of grievance will fester. Stark cut-off points are bad law. If a man is given notice of redundancy a week before he is 66 he will qualify for a lump-sum payment. If he is given notice one week later he will not qualify for anything. Therefore, a man could lose as much as £3,700 in one week. We should not be providing for that sort of situation when we can easily avoid it. I would ask the Minister to at least consider the point and let us have his comments on Report Stage.
The position has been examined. The Deputy may be under a misapprehension when he refers to a one-week cut-off. This is specifically why there has been a postponement of one year, and it was accepted that this was necessary.
The other point I want to make to the Deputy is that there will always be the danger of creating a hardship no matter how one creates a cut-off point. There is general agreement that the proposals in the Bill give a substantial period—a full year—after the introduction of the Bill. I accept the Deputy's point and his reasons for making it, but it is adequately covered by the section.
It would be wrong of me not to press this point, which is a valid one. I accept the Minister's point about the year's postponement affecting the pension age. There is a possibility of the injustice being there in April 1980 and I believe that we could provide for such a situation.
The Minister said that both sides of industry had asked for a phased reduction. If they have asked for it and I am asking for it, perhaps the Minister would consider the matter again.
I said that there was general acceptance by both sides of industry of the terms of the section. The position is that the section will reduce as from 6 April 1980—that is, a year from the introduction of the Bill—the upper age for qualification to coincide with the old age pension age. Both sides urged that the reduction should not take place immediately and that there should be a time limit in which to adjust to it. The section postpones the equation of the redundancy upper age limit with the old age pension qualification age until 6 April 1980. It is true to say that, since the old age pension age is now 66 and insurability for all benefits under the Social Welfare Acts, 1952 to 1966, ceases on reaching old age pension age, it is by virtue of this that entitlement to redundancy payments up to the age of 70 still exist.
It is also true to say that the original reason for the four-year extension was to enable non-manual workers to qualify for redundancy payments for some time after ceasing to be insurable on reaching the earnings limit for compulsory insurability. This reason no longer applies as non-manual workers no longer cease to be insurable on reaching a specific income point. I am satisfied that the time limit has been met. The extension is there and I am happy with the section.
Amendment put and declared lost.
Amendment No. 12 not moved.
Section 5 agreed to.
SECTION 6.
I move amendment No. 13:
In page 4, lines 10 and 11, to delete ", but the amount of rebate when so reduced shall not be less than 40 per cent of the lump sum" and substitute "by such percentage as he shall decide is appropriate".
What I am proposing to do is to give the Minister more power than he has taken for himself. In a case where minimum notice is not given, as required by redundancy legislation, the Minister is suggesting that the rebate payable out of the redundancy fund could be reduced to 40 per cent. I am suggesting that we do not confine the Minister to 40 per cent but allow him the discretion to reduce it to any figure. It is not sufficient disincentive for some employers to confine the Minister's discretion to reducing the rebate to 40 per cent. Any Minister would exercise discretion very much in this case, and for that reason I advocate that we delete the words, "but the amount of rebate when so reduced shall not be less than 40 per cent of the lump sum" and substitute "by such percentage as he shall decide is appropriate". It is right that we should do that because where there is a blatant breach of legislation the Minister should have some effective sanctions to ensure that the legislation is abided by. A reduction to 40 per cent is not sufficient.
I oppose this amendment. The provision specifies a standard rebate of 60 per cent with a floor or lower limit of 40 per cent for rebate where the Minister exercises his discretion to reduce the rebate for failure to comply with the notice requirements in section 17 of the Principal Act. The amendment would have the effect of giving the Minister unlimited reduction discretion, in fact too much power in such cases by removing the limit below which the rebate could not be cut. The existing rebate provisions provide for a possible reduction of rebates from 55 per cent to not less than 45 per cent. Section 6 has increased the Minister's discretionary power by 10 per cent, in other words bringing it from 60 per cent to 40 per cent. It is not considered that the rebate reduction provisions need be made even more drastic. Take, for example, a case where a rebate of £2,000 is due to an employer. He could be penalised under this section to the extent of £400, which is a sizeable portion of that £2,000. The penalty is adequate and the provision should remain as it is.
A slightly different position exists now from when redundancy legislation was first introduced. The reason for the incentive to employers is to give more than the minimum two weeks' statutory notice but mainly to give workers more time to look for other jobs or training and to provide manpower information for the purpose of the replacement of redundant workers in new employment or training. Since then we have had the Minimum Notice and Terms of Employment Act, 1973, which gives employees the right to notice of dismissal of up to eight weeks depending on the length of service. There is also the Protection of Employment Act, 1977, which put certain duties on employers to notify the Minister and to have consultations with the employee and the trade union organisation concerned. All of these are new since that legislation was introduced and they are on the positive side of the question.
On the negative side, I see no benefit in giving the Minister any further discretionary powers. The Deputy, who in the normal course would probably be taking powers from the Minister or charging the Minister with taking too much power, is going a little too far in giving the Minister more power than he should be seeking. The increase of the percentage in the existing situation to what is now in the new one is substantial. The example I have given is what could be regarded as a £400 fine on a rebate of £2,000, which I believe to be adequate.
I put down this amendment with some reservation because I believe that there should be, as far as possible, some check, as I also indicate in my other amendments. On the other hand, I feel that the sanction in this section as proposed by the Minister is not sufficient. We recall the Ferenka situation where 1,400 workers were involved when the minimum notice was not given. If a company were to lose the full 60 per cent rebate if they behaved similarly in the future, there would be very few repeats. The legislation to which the Minister referred, the Protection of Employment Act and the Minimum Notice and Terms of Employment Act, was not sufficient in the Ferenka case and very possible will not be sufficient in the future. Perhaps my amendment is a little far-reaching, but we should put a little more bite into the Minister's power.
I do not wish to stray too far from the amendment and the section, but in passing I remark that in the House here yesterday we had several cases where legislation was ineffective; it was there all right but ineffective. We should look very closely to make sure that what we are passing in this House would be effective. I am not going to press the amendment but I ask the Minister at least to rethink and maybe go a bit further if he is not prepared to go the full way.
Amendment, by leave, withdrawn.
Section 6 agreed to.
SECTION 7.
I move amendment No. 14:
In page 4, subsection (1), line 16, to delete "104 weeks"' and substitute "52 weeks' ".
My reason for moving this amendment was to allow for greater mobility of workers, particularly large numbers of workers in the clothing, footwear and construction industries, by reducing the number of weeks. Constraints would be removed from these workers, there would be general movement and they would not be debarred from receiving redundancy payment. It is a social question and one we should consider. I ask the Minister to accept this amendment or, if he does not, to reconsider the matter after one year's trial.
The 104 weeks and 52 weeks are the basic bones of contention. The 104 weeks is the qualifying period for redundancy in general and the Deputy is proposing that it should be reduced to one year. At this stage it would be unrealistic to reduce that period from 104 weeks to 52 weeks. We will be discussing this again at a later stage, but I must oppose this amendment.
I would like this amendment put to the House.
Amendment put and declared lost.
I move amendment No. 15:
In page 4, lines 16 and 17, to delete "under section 17 of the principal Act".
Section 7 (1) confines the right to time off to employees having the requisite period for redundancy entitlement who have been given notice of proposed dismissal under section 17 of the Principal Act. On consideration it is felt that the terms of subsection (1) should be less explicit. Omitting the reference to section 17 of the Principal Act is basically to avoid the possibility that employers might seek to avoid liability under section 7, that is, to allow reasonable time off by simply refraining from giving notice or by giving notice other than in compliance with section 17 of the Principal Act. This is basically to prevent the possibility of an employer not giving notice and the employee not being able to get time off.
Amendment agreed to.
Amendment No. 17 in the name of Deputy Mitchell is an alternative to amendment No. 16 in the name of Deputy Ryan, so they can be discussed together.
I move amendment No. 16:
In page 4, lines 20 and 21, to delete "during the two weeks ending on the expiration of his notice of dismissal", and substitute "before the expiration of his notice of dismissal".
It is a very simple technical amendment and is self-explanatory. The inclusion of this amendment would bring the situation into line with the situation in Northern Ireland and that in itself might be worthwhile.
I am trying to provide that the employees have four rather than two weeks. I had other amendments which were too late for publication which would have helped to improve the section generally, but not having them in on time was my own fault. Two weeks is rather short notice when a person is being made redundant, as it gives him little opportunity to seek alternative employment. For that reason I suggest that the period be increased to four weeks.
I am opposed to these amendments because we already have a worthwhile innovation; giving people the opportunity to have time off to seek alternative employment during the two weeks notice. A Minister must balance the views expressed to him, and in a situation like this there would be on the one hand a complete rejection of the idea and, on the other, a plea for a longer period. I have balanced the situation reasonably well. The two weeks notice period, with an opportunity to have time off to seek alternative employment or training, is a major step forward. I had discussions with the interested parties and I undertook to include this kind of provision. However, this being an innovation, it is advisable not to extend the period beyond two weeks. As Deputies are aware there are many other pieces of legislation, such as the Protection of Employment Act, under which industries have to notify redundancies to the Department in addition to having the consultations. These redundancy notices are immediately brought to the attention of the placement services. This two week period can now be utilised to assist people who succeed in setting up interviews or in making genuine efforts to find employment. This new move is desirable but it should be left at the two weeks to avoid further complications.
Does the Minister not feel that having four weeks advance knowledge would help him and the placement services as well as facilitating employees in seeking alternative employment or training?
I do not.
I appreciate that this is an innovation, but would the Minister agree to have another look at this after 12 months because Deputy Mitchell's proposal is reasonable? The two weeks may not be sufficient. However, in the light of a year's experience perhaps the Minister would look at it again to see if the period needs to be extended to four weeks.
The Deputy must appreciate that I cannot give an under-taking of that nature at this stage. As the Deputy is aware, under this Bill, if a difficulty arises during the first year of the Bill's operation I have the power to bring in certain orders, but I cannot give the assurance that the Deputy has asked for and he will appreciate my reasons.
Will the Minister bear it in mind at least?
I will, but the Deputy will appreciate that I cannot give an assurance.
Amendment, by leave, withdrawn.
Amendment No. 17 not moved.
Question proposed: "That section 7, as amended, stand part of the Bill."
The last words in sub-section (4) of section 7 "if it is not prejudicial to the employees interests" seem to indicate that the case made by the FUE is right, that these words probably render the whole subsection meaningless. Will the Minister look at the entire subsection with a view to rephrasing it? The employer can ask an employee seeking time off during his notice to look for employment or training to give evidence that he is really seeking alternative employment or training, but the employee can refuse to give the information if in his opinion it is prejudicial to his interests. Any sensible employee would take the two weeks off and would look for employment but would tell the employer that he could not supply information because it would be prejudicial to his interests. The Minister ought to look at that.
The Deputy will appreciate that there must be a reasonable amount of flexibility between both sides. In some cases it may not be in the interests of the employee to divulge his contacts or to give information about the alternative employment he is seeking and it would be unreasonable of any man in those circumstances to insist. On the other hand, I accept that it would be unreasonable of the employee to avail of this clause to do something other than seek employment. This is an effort to balance as far as possible what is reasonable. It is reasonable for an employee to be given a certain time off to seek employment during that period. It is also reasonable that the employer should at least be able to be told as much as possible by the employee about his efforts in seeking work, but there could be confidential matters that in the interests of the employee should not be divulged. There has to be flexibility here. There must be goodwill on both sides, but we must be concerned about the employee's interests. If an employee feels that there is some danger to himself if he discloses some information it is important that he should have that little bit of flexibility.
There is undoubted force in what the Minister says. I do not wish to diminish the rights of employees. However, I feel that, as the subsection stands, it is very defective. I believe we are leaving every employer open to a potentially serious situation during the duration of the notice. With, say, 100 employees, it could happen that each would decide to take the maximum time off seeking alternative employment and this could scuttle the firm. The subsection leaves that a possibility. I think it needs a good deal of tightening up and reconsideration and not just deletion of the last few words. Perhaps the Minister would consider that between now and Report Stage.
I am satisfied with the subsection as it stands. The Deputy is forgetting an overriding consideration, that the tribunal is always there and can be resorted to if an employer feels that an employee is not complying with what he believes to be the terms of the Act. There was a request from the FUE to have "reasonably" inserted after that. If the Deputy reads that with the word "reasonably" inserted, it does not alter the position. I emphasise again that the tribunal is there as a body that can decide if the employer has recourse to the tribunal because he feels an employee has contravened the Act. I believe this is a worthwhile provision which gives the employee a reasonable chance of seeking alternative employment or at least of availing of time when perhaps he would find it easier to get a job than when his employment ceases.
The Minister referred to the powers conferred in subsection (5) where differences arising out of subsection (4) would be adjudicated by the employment appeals tribunal. Then, depending on the tribunals decision, if it decided that an employer did owe an employee money for time taken off the employee could then take the employer to court. The fact is that many working people would not want to incur legal costs and go to court to recover pay for a day or two.
Both subsections could be easily cleaned up. For instance, in subsection (5) instead of having "... paid by an employer to an employee shall be recoverable as a simple contract debt in a court of competent jurisdiction", it could be done by reducing the rebate by that amount and making it payable directly to the employee in the case of an adjudication by the appeals tribunal. There would be no necessity for the employee to go to court and there would not be congestion of the courts. It is a simple suggestion that the Minister should stop out of the rebate any amount adjudicated by the tribunal, not pay it to the employer but pay it directly to the employee. I had that simple proposal in, but it was too late. The Minister should look again at subsections (4) and (5) because I think we are making bad law in both subsections.
There is no difference between that and what is happening at present. Under the Minimum Notice and Terms of Employment Act in cases of redress like that, the employee goes to the court. I am not doing anything here that is not already provided for in existing law. These points are adequately covered in the section and I am happy with the wording as it is.
Question put and declared carried.
Section 8 agreed to.
SECTION 9.
I move amendment No. 18:
In page 5, after line 23, to insert a new subsection as follows:
"(3B) Notwithstanding the generality of this section, section 15 (2) shall apply where employment is terminated by the employee under section 9 (1) (c) if an offer in writing is made by the employer under section 15 (2)".
This can be described as both a technical and protective amendment to facilitate both employer and employee when the employee himself has justifiably left or leaves his position in an industry which is running down. This amendment if adopted would enable the employer to make him an offer in writing—I emphasise "in writing"—which would enable the worker to resume his employment in the previous industry. I ask the Minister to consider its inclusion in the section.
I am sorry that I cannot accept the amendment because it could create a very dangerous precedent. As I understand it, it appears employees could anticipate redundancy——
A failing industry.
——or a failing industry. What the Deputy is asking could be a contributory factor towards the final closure of an industry, if, in any constituency, particularly in small rural areas where such a thing can happen, rumours circulate that a particular industry employing 50 to 70 people is in serious financial trouble. If ten, 15 or 20 decide to anticipate the situation an industry that might well have been saved by an injection of cash or merging or something else could be forced to close.
I accept that.
Amendment, by leave, withdrawn.
I move amendment No. 19:
In page 5, after line 23, to insert a new subsection as follows:
"(3B) (i) Without prejudice to the generality of subsection (1) of section 9 of the Principal Act, an employee shall be entitled to terminate his contract of employment in circumstances of uncertainty in which it is reasonable for the employee to anticipate dismissal for redundancy (whether or not he has received notice of dismissal or protective notice of dismissal or lay-off) if it is reasonable for the employee to expect that his remaining in the employment would seriously prejudice his prospects of obtaining suitable alternative employment which became available and was unlikely to remain vacant.
(ii) Where, in the circumstances specified in this section the employee has received an offer in writing from the employer and on a reference to the Tribunal it appears to the Tribunal, having regard both to the reasons for which the employee seeks, or sought, to leave the employment and those for which the employer requires, or required, him to continue in it, to be just and equitable that the employee should receive the whole or part of a redundancy payment, the Tribunal may determine that there shall be paid to the employee—
(a) the whole of the redundancy payment to which the employee would have been so entitled, or
(b) such part of that redundancy payment as the Tribunal thinks fit."
This amendment was proposed by my party in 1967 for inclusion in the then Bill. It would mean that the tribunal can decide on the entire circumstances of the case as to whether the party involved can be awarded either full or partial benefits. I believe that is something that will come eventually and perhaps we could do it now since it is something we cannot stop. I ask the Minister to include it.
I regret I cannot. I see a close link between the two amendments. As I said earlier, I fear that the danger of catering for possible redundancy or anticipated redundancy could be more harmful to suffering firms. Basically this amendment seems to be on the same principle. As regards an employee who justifiably leaves employment because of various circumstances the inherent danger is that we are returning to the same problem we had in the past. The subsection deals with the reasons why employees have left employment because of the employer's conduct. It outlines the circumstances in which an employee would be entitled to terminate his contract where it is reasonable for him to anticipate, irrespective of any notice given or dismissal, a redundancy or if it is also reasonable for him to expect that remaining on in the job would prejudice his chance of other employment which is available but might not remain so.
The reason I am reluctant to accept the amendment is that I believe it would prove a source of difficult disputes adding to the tribunal's already heavy workload. It attempts to deal with contingencies related to such vague terms as "uncertainty", what the expectation of the employee might be and the likelihood, or otherwise, of other employment remaining available and whether the firm will or will not survive. Those questions are dealt with in that section but the amendment would be likely to prevent the employer holding on to his workforce in what could be a tough situation which the firm might come through successfully. The amendment would be a likely disincentive to an employer to hold on to his workforce and exhaust every possibility of keeping the firm viable and maintaining employment. There is an inherent danger here that the employer, rather than battling on to the final fence, might decide to close and this would not help any of us. For that reason I suggest to the Deputy that he should not proceed with his amendment.
In hindsight I accept the weaknesses in the amendment and I also accept the Minister's concern that it would have the eventual effect of a closure rather than helping an industry. I appreciate the heavy workload of the tribunal but I am anxious that the tribunal would have the power to decide, having heard the facts, whether the person concerned is entitled either to full or partial benefit. I want additional power given to the tribunal to make the final decision as to whether the person concerned suffered hardship to the extent that he or she should be entitled to full or partial benefit. I accept the Minister's view that the amendment is a weak one but there is merit in the next amendment.
I am worried about building something into the legislation that might, in the long term, do more harm than good. At present if people feel they have a case they can leave on the basis of rumours and have their case processed. To include this amendment would be unhelpful towards maintaining employment. It could put the appeals tribunal in a difficult situation disputewise and it may be an encouragement to an employer not to battle on to the end, as we would like to see him do, and maintain the jobs. I see dangers in this and I would be afraid to include it in the legislation.
Amendment, by leave, withdrawn.
Section 9 agreed to.
Section 10 agreed to.
SECTION 11.
Amendments Nos. 20, 21, 22 and 23 are related and, in my view, could be discussed together.
I have a note to the effect that amendments Nos. 21 and 22 are related but if the Deputy wishes, and the House agrees, he may take those amendments together.
I would prefer to have those amendments taken together because there is nothing new in the thinking behind them. It is an amalgam of consolidating amendments containing all that is in the three existing Acts.
I move amendment No. 20:
In page 5, before section 11, to insert a new section as follows:
"11.—The following section is hereby substituted for section 15 of the Principal Act:
15.—(1) An employee shall not be entitled to a redundancy payment if
(a) his employer has offered to renew that employee's contract of employment or to re-engage him under a new contract of employment,
(b) the provisions of the contract as renewed, or of the new contract, as to the capacity and place in which he would be employed and as to the other terms and conditions of his employment would not differ from the corresponding provisions of the contract in force immediately before his dismissal,
(c) the renewal or reengagement would take effect on or before the date of dismissal and
(d) he has unreasonably refused the offer.
(2) An employee shall not be entitled to a redundancy payment if
(a) his employer has made to him in writing an offer to renew the employee's contract of employment or to re-engage him under a new contract of employment,
(b) the provisions of the contract as renewed, or of the new contract, as to the capacity and place in which he would be employed and as to the other terms and conditions of his employment would differ wholly or in part from the corresponding provisions of his contract in force immediately before his dismissal,
(c) the offer constitutes an offer of suitable employment in relation to the employee,
(d) the renewal or reengagement would take effect not later than four weeks after the date of dismissal, and
(e) he has unreasonably refused the offer.
(2A) Where an employee who has been offered suitable employment and has carried out, for a period of not more than four weeks, the duties of that employment, refuses the offer, the temporary acceptance of that employment shall not solely constitute an unreasonable refusal for the purposes of this section.
(2B) Where—
(a) an employee's remuneration is reduced substantially but not to less than one-half of his normal weekly remuneration, or his hours of work are reduced substantially but not to less than one-half of his normal weekly hours, and
(b) the employee temporarily accepts the reduction in remuneration of hours of work and indicates his acceptance to his employer,
such a temporary acceptance for a period not exceeding 52 weeks shall not be taken to be an acceptance by the employee of an offer of suitable employment in relation to him.
(3) Where a person who is entitled to a weekly payment has unreasonably refused suitable employment offered on approval by the National Manpower Service, that person shall be disqualified from receiving a weekly payment for a period not exceeding six weeks.".
This amendment should be accepted by the Minister and I will hold fast on it and the other three.
I appreciate that this is an attempt at consolidation and I do not underestimate the importance of that but it is our intention to consolidate the Acts, not just individual sections as is attempted here. When the Bill is passed it is our intention to produce a comprehensive and simple guidebook in layman's language and give information on redundancy, redundancy entitlements and guidelines generally so that everybody will understand the legislation. In the long term, the grounds of general consolidation will be attempted but at this stage this is not the correct way of going about consolidation. This attempt at partial consolidation is not the correct way. Obviously, all these matters will have to be vetted by legal experts because of their importance. I do not disagree with the Deputy when he stresses the need for consolidation but I have given an under-taking that I will do that.
I accept that.
Amendment, by leave, withdrawn.
Amendments Nos. 21 to 23, inclusive, not moved.
Section 11 agreed to.
NEW SECTION.
I move amendment No. 24:
In page 6, before section 12, to insert a new section as follows:
"12.—Where
(a) a dismissal (or termination of employment) occurred before the commencement of this Act, and
(b) the employee was not entitled to redundancy payment under the Principal Act solely because section 10 or 11 of this Act was not in operation, and
(c) the employee had made an appeal to the Tribunal prior to 15 January 1979 and a decision had not been made by the Tribunal or the High Court,
(d) the Tribunal shall, as soon as may be after the passing of this Act, make a decision as if sections 10 and 11 of this Act had been in operation, and shall pay to an employee out of the Redundancy Fund any moneys to which the employee may become entitled by virtue of any decision made under this section."
The inclusion of this new section is overdue since 1971 and is justified because of the existence of a limbo situation at present. A number of cases are at present before the tribunal and the injustices involved in those cases has been recognised but, unfortunately, those people will not benefit from the inclusion of such an amendment. A hardship situation exists in that the people who created the problems are not being included. They are in this limbo situation.
I should like to thank the Deputy for his comments on the section. This section has been found to be necessary. The amendment is directed to deal with cases which are still pending before the tribunal and could be regarded as sub judice. I am not unsympathetic to the case the Deputy is making but I would point out that there are serious difficulties here because they are sub judice, because of retrospective legislation, and because of the danger that there may have been others who could have had similar claims and one could be charged with discriminating against them.
I will not give the Deputy a lot of hope but I will look at this between now and Report Stage. If I cannot come up with an amendment, the Deputy will be in a position to put down a further amendment on Report Stage.
I accept the Minister's concern for the situation because there will be hardship. The Minister said there may be other cases which were not brought to court but the people I am talking about took the steps necessary to get an adjudication on their case and they have been caught half way. I hope the Minister on Report Stage will show concern.
Amendment, by leave, withdrawn.
I move amendment No. 25:
In page 6, before section 12, to insert a new section as follows:
"12.—The following section is hereby substituted for section 24 of the Principal Act.
24. (1) Notwithstanding any other provision of this Act, an employee shall not be entitled to a lump sum unless before the end of the period of 52 weeks beginning on the date of dismissal or the date of termination of employment—
(a) the payment has been agreed and paid, or
(b) the employee has made a claim for the payment by notice in writing given to the employer, or
(c) a question as to the right of the employee to the payment, or as to the amount of the payment, has been referred to the Tribunal under section 39.
(2) Notwithstanding any provision of this Act, an employee shall not be entitled to a weekly payment unless he has become entitled to a lump sum.
(3) Where an employee who fails to make a claim for a lump sum within the period of 52 weeks mentioned in subsection (1) makes such a claim before the end of the period of 104 weeks beginning on the date of dismissal or the date of termination of employment, the Tribunal, if it is satisfied that the employee would have been entitled to the lump sum and that the failure was due to a reasonable cause, may declare the employee to be entitled to the lump sum and the employee shall thereupon become so entitled.
(4) Notwithstanding subsection (3), where an employee establishes to the satisfaction of the Tribunal—
(a) that failure to make a claim for a lump sum before the end of the period of 104 weeks mentioned in that subsection was caused by his ignorance of the identity of his employer or employers or by his ignorance of a change of employer involving his dismissal and engagement under a contract with another employer, and
(b) that such ignorance arose out of or was contributed to by a breach of a statutory duty to give the employee either notice of his proposed dismissal or a redundancy certificate,
the period of 104 weeks shall commence from such date as the Tribunal at its discretion considers reasonable having regard to all the circumstances."
This is another consolidating amendment combining previous legislation and Government amendments. It deals comprehensively with the section for time limit on claims. There is nothing controversial in it and perhaps at this stage the Minister would accept one amendment.
The Deputy has not been doing too badly up to now. On this amendment I will have to make the same case as I did on the previous one.
On Report Stage the Minister will——
No, on the previous consolidating amendment. This is an attempt at consolidation on the grounds that general consolidation will be attempted later and that the guidebook to which I referred will be produced immediately the Bill is passed.
Amendment, by leave, withdrawn.
Section 12 agreed to.
SECTION 13.
Amendments Nos. 26, 27 and 28 have been ruled out of order.
Question proposed: "That section 13 stand part of the Bill."
This section makes the redundancy lump sum a preferential debt on a receivership. It has been pointed out to me that if two companies apply to a bank for loans there will be a tendency for the bank to give the loan to the company with the lower labour content. Under this Bill the Government will get paid before the bank. The bank could create a floating charge over these assets and that would not be of benefit to the bank. In such a situation the bank would not be inclined to give loans to labour-intensive firms. This point was brought to my attention by bankers and people involved in receiverships. They do not oppose the idea behind the section; they wanted to point out the difficulties that might arise.
I appreciate the point made by the Deputy. I would be extremely disappointed if our banks and lending institutions took such a matter into consideration when determining a loan. The redundancy situation is a very important and delicate part of our manpower policy. It is something we all wish to avoid. It would be very desirable if we did not need this type of legislation and that every job was guaranteed, but of necessity we must have this legislation to protect those who lose their employment. For that reason the banks and lending institutions should be told that this should not be a criterion for deciding to give a loan to a company. In the event of closure, the question we should ask is why should banks get preference over a worker's claim. In many instances these people may have spent 30 or 40 years in that firm and while naturally we cannot accept any responsibility for a bank decision, in fairness we must have regard to the people who are vitally concerned, that is the redundant workers.
I appreciate that point. The point I was trying to make is that a firm who may not employ so many people could influence the bank when a loan is sought. Everyone knows the idea behind the section is to give preferential treatment to the workers but in the hard commercial world lending institutions might not take that view.
I want to repeat that it should be conveyed to those institutions that that criterion should not be used in deciding to grant loans. The people I am concerned about are those who are made redundant.
Question put and agreed to.
SECTION 14.
Amendment No. 29 and related amendments Nos. 30 and 31 have been ruled out of order.
Section 14 agreed to.
SECTION 15.
I move amendment No. 32:
In page 7, subsection (2), lines 19 to 23, to delete all words after "made," in line 19 to the end of the subsection and substitute "and no such order may come into effect unless and until approved by both Houses of the Oireachtas.".
It is easy for administrators to make orders that become law. Before an order comes into effect it should be laid before both Houses of the Oireachtas. That would give it full legal sanction. Orders as they are being made at present are removing from this House the power vested in it by the people. I am surprised at the way politicians seem to want to divest themselves of very important powers. I ask the Minister to consider this matter very seriously. Normally those orders have the full support of the House because they make sense. Those orders will alter legislation that is being passed through the House and they should be referred back. I ask the Minister to accept this reasonable amendment not just for this Bill but for all future Bills. It is convenient for a Minister to say by order: "I do this" but that is not good enough. The House has got to protect its sovereignty against this sort of easy legislation. I ask the Minister to consider this amendment sympathetically.
This is a standard section in many pieces of legislation over the years. I recall arguing Deputy O'Brien's case in my Opposition days. I fully realise the reasons for it. I must oppose the amendment. The standard section I have referred to is in section 55 of the original Redundancy Payments Act, 1967, and a similar provision is in the Social Welfare (Amendment) Act, 1978. I assure the Deputy that the rights of Members of the House are protected. Misuse of the Minister's powers is safeguarded simply because either House of the Oireachtas has power to annul by resolution any order made by him under this section within 21 days, the same as in many pieces of legislation which have gone through this House.
There is nothing exceptional about this order. The Deputies interested will, of course, be aware of that order being tabled. If and when an order is made it is tabled in the House, it makes it easier for Deputies interested if they wish to raise that point in the House. On the other hand, it is true to say that in the case of a Bill like this if orders are necessary they should be expedited as far as possible. If they are laid before the House and the Members have no objection to them they go through in the normal way.
I do not accept that because it is standard practice we must live with it. From time to time we have to review our standards and what has been the practice. It is not good enough for the Minister to say that when he was on this side of the House he felt the same as I do but now that he is on the other side it is a different matter because it is standard practice. I am surprised at the Minister openly admitting that he agrees with me in principle.
I did not say what the Deputy is saying now.
May I be heard?
The Deputy may be heard but he should be honest.
The Minister said when he was sitting here——
I defend what I said here. The Deputy will not misquote me.
Sorry, Minister and Deputy, we were moving very quietly all morning. If the Minister said he did not say something that is accepted by the House. Deputy O'Brien on the amendment.
The Minister said that when he was on this side of the House he had the same feeling about this as I have. In my view if he had that feeling about it when he was over here in principle he must agree with it. Now that he has taken over the role of Minister his whole outlook changes but that is not good enough. The Minister agrees that legislation made by order is not good. We have machinery to annul such orders by bringing the matters before the House. I accept that the Minister is going by precedent and obviously the people in his Department advise him about what to do and what not to do. This is not good politics and is not good for Parliament. If the Minister felt something was wrong when he was this side of the House his duty should be, when he steps over to the other side, to rectify the matter. The Minister is not prepared to do that. I am disappointed he is not prepared to accept this very reasonable amendment.
The Deputy is making mountains out of molehills. First of all, to clear up the point I interrupted him on, I said when I was on the other side of the House I made the same point as the Deputy. That did not mean that I said that I now agreed that it was right. I now see the reason why this is a very desirable element, particularly in a Bill like this. I want to say as well that nobody controls me. I control myself.
I will now try to assure the Deputy why I believe that this section is important as it stands. Deputy O'Brien said that no machinery was available but this is not right. The machinery of the House is there for the annulment of an order within 21 days. This section of the Bill only lasts for one year after its introduction. It is to prepare for a contingency where some unforseen difficulty may be picked up in the operation of the new scheme. If some unforseen difficulty is picked up obviously that will be the only time it will be used. I can assure the Deputy that this section will not be used only for minor procedural changes. The machinery of the House will be available to the Deputy even for dealing with those minor procedural changes. The probability is that this will never be used during the year of operation. The reasons for this are very desirable. It is a way of removing, if it arises, some unforseen difficulty in the fastest, most expeditious way possible. It is as simple as that.
The whole idea of orders is that they are expeditious and handy but we have to look at the situation again. I am not referring to this legislation alone and I am not attacking the Minister on the basis of this particular amendment. The Minister should accept that the principle is wrong. Even though it is in other Acts he should say that he does not approve of it and he will change it.
He is not prepared to do that. I think he is wrong and I regret it.
I do approve of it.
Amendment put and declared lost.
Section 15 agreed to.
SECTION 16.
Amendment No. 33 not moved.
Section 16 agreed to.
Sections 17 and 18 agreed to.
SECTION 19.
Amendment No. 34 ruled out of order.
Section 19 agreed to.
Section 20 agreed to.
SCHEDULE.
I move amendment No. 35:
In page 8, in column (2), opposite "Section 4 (2)" in column (1), to delete "20 hours" and substitute "16 hours."
On Second Stage I emphasised my concern about this Schedule and I asked for the substitution of "16 hours". This would cover many part-time workers, such as office cleaners, school bus drivers and caretakers of local authority water and sewerage works. I would be prepared to accept a compromise of 18 hours which would equate it to the social welfare qualifications. Perhaps at this late hour we could reach a compromise.
This amendment proposes to reduce the number of hours from 20 to 16. It is felt that redundancy entitlement should be confined to jobs providing the main source of income as indicated by working more than half the working week and therefore this amendment must be rejected. The limit settled in the Dáil during the passage of the original Bill was 21 hours, which was half the then normal working week of 42 hours. The reduction of the limit as proposed in the section is in line with the general reduction in the normal working week. It is now generally 40 hours. This is why I have reduced the number of hours from 21 to 20. It is also important to establish that redundancy entitlements should be confined to jobs providing the main source of income. If we reduce too far the minimum hours, the danger could be that redundancy entitlement could be derived from a sideline. I cannot accept the compromise.
Even a compromise of 18 hours?
I am sorry.
Amendment, by leave, withdrawn.
Amendments Nos. 36, 37 and 38 are related and may be discussed together.
I move amendment No. 36:
In page 8, in column (1), after "Section 4 (2)", to insert "Section 7 (5)", and in column (2), opposite "Section 7 (5)" to insert "The substitution of ‘52 weeks' for ‘104 weeks' (inserted by the Act of 1971)."
These amendments are intended to prevent discrimination against employees, particularly in the building and clothing trades. Building contracts in rural Ireland normally do not exceed 18 months. If the provision cannot cover 52 weeks, then it should at least cover 78 weeks or 18 months' employment.
We are getting back to the earlier discussion regarding 104 and 52 weeks. I am not convinced that this is the appropriate time to reduce the qualification period. In the UK not only is two years the minimum qualification but it is two years reckonable service—in other words, it must be two years' full service. In our circumstances it is two years' continuous service but one still qualifies for that service in spite of sickness and so on. For that reason I cannot accept the proposed reduction.
Amendment, by leave, withdrawn.
Amendments Nos. 37 and 38 not moved.
I move amendment No. 39:
In page 8, after "Section 23" in column (1) to insert "Section 32", and in column (2) opposite "Section 32" to insert "The insertion in subsection (1) (a) after ‘the balance,' of ‘or'".
This is a drafting amendment. Section 32 of the Principal Act, as inserted by section 14 of the 1971 Act, deals with payment to employees of lump sums from the redundancy fund. Subsection (1) of section 32 sets out the circumstances in which an employee may apply to the Minister for such payment. In the English version of section 14 of the 1971 Act the word "or" was omitted from the end of subparagraph (a) of the substituted section 32 (1). The Irish version was at all times correct and advantage is being taken of this opportunity to improve the drafting.
Amendment agreed to.
Amendments Nos. 40 and 41 are related and may be discussed together.
I move amendment No. 40:
In page 8, in column (2), to delete the reference to Schedule 3 and substitute:
"The substitution of the following paragraphs for paragraphs 4 to 7 inclusive:—
CONTINUOUS EMPLOYMENT
4A. For the purposes of this Schedule employment shall be taken to be continuous unless terminated by dismissal or by the employee's voluntary leaving the employment; but for the purposes of this paragraph "dismissal" does not include a dismissal within the meaning of the Unfair Dismissals Act, 1977, and in respect of which redress has been awarded under section 7 (1) (a) or 7 (1) (b) of that Act.
4B. If an employee is dismissed by reason of redundancy before attaining the period of 104 weeks referred to in section 7 (5) (as amended) of the Principal Act and resumes employment with the same employer within 26 weeks, his employment shall be taken to be continuous.
5. (1) Where an employee's period of service is or was interrupted by any one of the following—
(a) a period of not more than 78 consecutive weeks by reason of sickness, (including an injury),
(b) any period by reason of service by the employee in the Reserve Defence Force,
(c) a period of not more than 26 consecutive weeks by reason of—
(i) lay-off,
(ii) holidays,
(iii) any cause (other than the voluntary leaving of his employment by the employee) not mentioned in clauses (i) to (iii) but authorised by the employer,
(d) any period during which an employee was absent from work because of a lock-out by his employer or because the employee was participating in a strike, whether such absence occurred before or after the commencement of this Act,
(e) a period of not more than 13 consecutive weeks during which the employee gave birth to a child,
continuity of employment shall not be broken by such interruption whether or not notice of termination of the contract of employment has or had been given.
(2) During the year 1968 subparagraph (1) (b) shall have effect as if "52 consecutive weeks" were substituted for "26 consecutive weeks".
6.—Where a trade or business or an undertaking (whether or not it be an undertaking established by or under an Act of the Oireachtas), or part of a trade or business or of such an undertaking, was or is transferred from one person to another, the period of employment of an employee in the trade, business or undertaking (or in the part of the trade, business or undertaking) at the time of the transfer shall count as a period of employment with the transferee, and the transfer shall not break the continuity of the period of employment.
RECKONABLE SERVICE
7.—For the purposes of this Schedule, a week falling within a period of continuous employment and during which (or during any part of which) the employee concerned either was actually at work, or was absent therefrom by reason of sickness, a dismissal within the meaning of the Unfair Dismissals Act, 1977, and in respect of which redress has been awarded under section 7 (1) (a) or 7 (1) (b) of that Act, holidays or any other arrangement with his employer shall, subject to paragraph 8, be allowable as reckonable service.' "
Progress reported; Committee to sit again.
Business suspended at 1.30 p.m. and resumed at 2.30 p.m.