I move:
That Dáil Éireann approves the following Order in draft:—
Worker Participation (State Enterprises) Order, 1980,
a copy of which Order in draft was laid before Dáil Éireann on 19 March, 1980.
It will be recalled that in 1977, when the Second Stage of the Worker Participation Bill was being moved in Dáil Éireann, the House was told that it was not possible at that time to determine, in advance, the sizes of the re-constituted State boards in question. The view was that it would not be appropriate at that stage to prescribe board sizes in the Bill as it could limit the discretion of the Government Ministers concerned. It was felt to be desirable and appropriate that the Ministers should have discretion in determining the size of the boards to take account of the appointments to the boards of members elected by employees. The solution adopted was to allow the new board sizes to be prescribed at a later stage by affirmative order.
For that purpose Section 23 of the Act empowers the Minister for Labour, after consultation with the Minister for Finance and other appropriate Ministers, to prescribe by order—in relation to each of the State bodies designated in the Act—the number of members or directors of the reconstituted boards, including the number of employees to be appointed following an election by the workforce. Where the total number is a multiple of three, elected representatives must constitute one third; otherwise the proportion of elected representatives must be rounded upwards to the number which is next above one third.
Under the terms of Section 4 (4) of the Act, a draft of any order to be made under Section 23 requires the prior approval of the Oireachtas by way of affirmative resolution of each House. The intention behind that provision was to ensure that there would be no diminution of the authority or responsibility of the Oireachtas in determining the appropriate size of the State boards concerned.
The present order, which has been laid before the House in draft, is designed to comply with the requirements of section 23 of the Act, insofar as two of the seven State bodies are concerned—Aer Lingus and Córas Iompair Éireann. The effect of the proposed order is that, as and from the date on which it is made, the size of the boards of these bodies will be fixed at twelve members, of which four—that is to say, one third of the total—will be elected by the workers for appointment under the Act. This will standardise the increase in the board sizes of all designated bodies as a previous draft order was approved by both Houses of the Oireachtas in July 1978 in respect of the other five State companies.
I have also included in the draft order provision for the similar alteration of the board of Aer Linte as required under Section 28 of the Act. This section, which was incorporated into the Bill at Committee Stage in Dáil Éireann on 26 January 1977 stipulates that employees elected to the Aer Lingus Board are to be appointed to the Board of Aer Linte also. This arrangement is necessary because even though Aer Lingus and Aer Linte are two separate legal entities, there is a long standing procedural arrangement whereby the boards of the two companies meet jointly and operate as one enterprise. In effect, it provides that where, under Section 15, the Minister for Transport appoints a successful candidate to the board of Aer Lingus he must at the same time appoint that person to the board of Aer Linte.
Deputies will be pleased to note that with the appointment of the successful candidates in Aer Lingus and CIE, following the forthcoming elections, the scheme will be fully implemented in all seven designated State bodies.
I believe that the introduction of employee directors has brought some positive elements into the operations of those companies where elections have already taken place. Since directors have only been on the boards of the five companies where elections have already taken place for about a year on average, I would not, at this stage, risk general conclusions on the success of the experiment. So far, the indications I have are positive.
In the first place, employee directors have had a favourable reception from their colleagues at all levels of the enterprise. Their intimate knowledge of the company's operations has, if anything, improved boardroom decision making. Communications upwards and downwards in the enterprises is being reassessed and there has been added stimulus to the development of sub-board consultative structures. Also, the experiment has shown that inter-union co-operation can extend across craft and occupational barriers.
These are tentative but positive results. I am continuing to have the operation of the Act and its development monitored and have arranged, with the active co-operation of both the Irish Congress of Trade Unions and the Federated Union of Employers, to have a report from the European Foundation for the improvement of living and working conditions, in association with the Irish Productivity Centre, on the impact and effectiveness of the legislation. The information gained from this project will be particularly useful in developing future policy in this area and extending the scope of the Act to other State bodies.