Payment of Wages Bill, 1991 [ Seanad ]: Second Stage (Resumed).

Question again proposed: "That the Bill be now read a Second Time."

Mr. Byrne

When I was last in possession we had cast our minds back to why there was a need for legislative changes in this area. It was outlined by most speakers both in this House and in the Seanad that, given the political "military" climate that prevails in Northern Ireland and which often spills over to the South and with the involvement of gangster and criminal elements, there was great difficulty in moving large sums of money from point A to point B and that, therefore, the Bill should be welcomed because it would allow payment to be made to manual workers other than by cash.

While I agree that the situation is of concern and that we should update our legislation, the legislation before us is rushed in so far as it does not take on board the submissions which have been made to the Minister or address satisfactorily the negative effects of its implementation on workers and their families. It is important to record that the legislation we are seeking to amend is essentially excellent and it was sound legislation in the period in which it was initiated. It was recognised as far back as 1464 that legislation was necessary to protect people who were engaged in the selling of their labour to employers. Every time legislation was brought forward subsequent to 1464 — in 1743 and 1896—the unscrupulous employers kept running ahead of the legislation and changing the circumstances of the method of payment of their workers. We all know that as far back as 1464 the workers were paid by produce, presumably produce off the land and the mills they may have worked in; it was a payment in kind as opposed to cash payment. It was recognised that something had to be done to protect the method of payment. Subsequently legislation was introduced to protect workers who were in receipt of subs. Prior to subbing, the method engaged in by employers was that the company store sold at exorbitant rates produce which was often inferior to the workers who were in employment either in mines, big farms or wherever they were located, as part payment of wages, so that the legislation had to be changed to catch up with these nasty employers who were underselling their workforce.

We arrived at a stage where the legislation had to be changed to offset the negative effects of huge interest charges being made by unscrupulous employers on moneys given to the workers in the form of a sub. As a former building worker I am aware that the method of collecting subs from an employer was certainly a common day occurrence. The first thing many manual workers did arriving at building sites, in the sixties and seventies, was to go to the employer and seek a sub payment that would tide them over the week they worked. I am not aware of interest charges to workers as late as the sixties and seventies but obviously that was something that happened in the past and had to be addressed.

Essentially, what I am saying is that all legislation we are about to amend today was legislation for the protection of the workforce. When we look back to 1460, 1743 and 1890 and right up to 1990 and the Payment of Wages Bill, 1991, which is before the House, one has to question the intent of the Bill. The intent of the Bill was very clear from the Minister's presentation both in the Seanad — where the Bill was introduced — and here in the Dáil and from the speeches of Members from the various political parties. In summary, it is my understanding that the presentation has been made on the basis that in the nineties it is difficult to ship large sums of money from point A to point B. An extra charge is imposed on employers because of extra insurance costs and an extra charge for the cost of conveying the money from banks through city streets. I take it that the term "manual worker" means particularly a tradesman and in the building industry. Because of the cost of servicing the transfer of large sums of money, the employers obviously have put pressure on the Minister and the Government to change the rules.

I said at the outset that we are not opposed to the changing of the rules. If huge sums of money will be saved for the employers, then we had better look at the implications for the employees and whether there will be negative effects for the employees who are forced to accept payment other than in cash. I would argue that there are major disincentives for workers to accept payment in a form other than cash. One of the major reasons for the reluctance of the organised workforce to accept any other form of payment is based on personal and historic experiences, the insecurity in particular in the building industry and the fear that perhaps payment in cheque form might not be honoured. Many manual workers are paid on an hourly basis and need instant access to cash for their own needs and those of their family. That worker needs instant access to cash so that the gas and ESB bills can be paid. Indeed, many working class families still operate a tick system with the local shop which often allows the bill to be paid at the end of the week.

When speaking in the Seanad I think the Minister compared this country to Denmark in this regard, where 90 per cent of the workforce are paid by a method other than in cash. I do not know the reasons for this, maybe there is better legislative protection for the worker. I cannot compare this country with Denmark because I do not know how the system operates there. We should try to find out why the workforce in Denmark accept payment other than in cash. Is there a degree of compulsion? The Minister has not adequately addressed the reluctance of the Irish workforce to accept non-cash payments.

The Minister has not taken the reservations of Irish workers in this regard into account. One reason could be the schedule of charge for customers of the AIB and Bank of Ireland. If a worker is forced to accept a cheque payment he, presumably, is obliged to open a bank account. However, that involves a huge range of charges for which the Minister has not included compensation for the worker. Charges include 17p for an automated transaction, between 14p and 17p on each cheque which is cashed and £3 per annum for a cheque card. There is also a payment of 7p per cheque in Government tax. Employers would make huge savings if workers were paid by cheque, in insurance and in the cost of transferring money from the banks to building sites or factories, but it is legitimate to ask why the savings should all go to the employer with apparently no benefit to the workforce. Indeed, there are penalties involved for workers.

Subsequent to speaking here the last time we debated the Bill, I received correspondence from the Irish Congress of Trade Unions which is on the lines of what I initially intended to bring up. They said they are extremely concerned at the failure of the Bill to address a number of key issues, in particular the failure to provide a statutory right to workers to time off to cash cheques or orders and to provide that additional costs, i.e. bank charges, and so on be borne by the employer. They said — and I agree — that these constitute a major defect in the Bill.

What would happen if workers in rural areas were obliged to accept payment in cheque, money order or some other form other than in cash? In some areas a travelling bank makes a periodic appearance and in other areas there is no banking service whatsoever. How does the Minister propose to encourage employers, even in an urban area like Dublin, to facilitate workers to transact business in the bank given the hours which operate in banks at present? It will be impossible for someone working from 8.30 a.m. to 5.30 p.m. to cash a cheque. I disagree with Deputy Shatter who said that this was great legislation because most workers have bank accounts and, therefore, should be happy to be paid by cheque. There is a difference in the lifestyle of TDs, who have access to a decent wage, professional people and ordinary working people. Many workers do not have a bank account and, incidentally, there is no reference in the Bill to credit unions whose members comprise most of the workers engaged in manual or unskilled labour. I ask the Minister to take on board the reservations expressed by the Irish Congress of Trade Unions.

I will not labour the point but I should like to reiterate my reservations in relation to this Bill. While the legislation is good, we must be realistic and recognise that Ireland in the nineties as far as security is concerned is not the Ireland of long ago. There are problems of security in relation to the transfer of cash. The massive savings to employers should mean that some benefits will also accrue to workers. I hope the Minister will address the question of banking hours and the difficulties of workers who do not have a bank account.

Mr. T. O'Sullivan

The Labour Party welcome many of the provisions in this Bill. However, there are a few areas in relation to which it will be necessary to table amendments on Committee Stage because there is an imbalance and a bias in favour of the employer, which must be addressed.

We are concerned about many areas. As Deputy Byrne has pointed out, there have been various pieces of legislation in place dealing with this matter. He mentioned legislation of 1464, 1743 and 1896. A person's entitlement to work goes back to biblical times when people laboured in the vineyards. "The last shall be first and the first shall be last"— in a sense that is what this legislation is all about. Much of the legislation in this area is pre-PESP and there is a need to address the problems which have arisen regarding the payment of wages. One of the major problems has been the question of security. People's lives have been put at risk while conveying large amounts of cash from banks to places of employment. The Minister has attempted to respond to that problem and we welcome that. However, it is necessary to ensure that no injustice is done to any section of the community. There are sections in the legislation where the Minister, perhaps inadvertently or through lack of foresight, has failed to respond to the needs of the workers.

Workers are now compelled to use the banking system. Despite what Deputy Shatter has said, a large majority of the working population in this country do not have a bank account. We are now creating a situation whereby people who have not had access to a bank in the past due to a shortage of money are now compelled to open an account. It will not be possible for people to cash a cheque if they do not have a bank account. In 1979 very serious problems arose in my own city, particularly in one firm who made the transfer to cheque payments. By virtue of the fact that some workers in that company did not have a bank account they were refused payment and, as a result endured quite a lot of hardship. The same is likely to happen again, and this is something that cannot be ignored. The Minister should ensure that there will not be a recurrence of that problem. We will try to deal with this matter by way of amendment. A guarantee should be given to workers that they will not encounter problems.

There is another problem regarding the banking service in that it is not nationwide. For example a major bank which was operating in the Ballymun area of Dublin withdrew its services. If a person in a heavily populated area such as Ballymun is paid by cheque he has to travel to an adjoining area to have his cheque cashed and is not compensated by way of time off to which he is entitled. Provision should be made to ensure that people should be given time off to cash their cheques without any expense to themselves.

As the Bill is presented, any savings that will accrue will be to the benefit of the employer. Savings should be shared by both the employer and the employee. While there is provision whereby the employer must meet certain conditions regarding payment of wages, there are no conditions laid down for the banks as regards bank charges. This has been referred to by Deputy Byrne. At present if a person wants to see a bank manager it costs money. If a worker in a low paid job has to consult with a bank official will he be charged for that service? If, for instance, there is a demand on his account for payment by way of a standing order and that payment cannot be met, the bank will charge for refusing payment. These are matters that will have to be dealt with in detail on Committee Stage to ensure that no further problems arise for people at work.

I am glad the Minister has made provision for employees who wish to take their case to a commissioner to have it investigated. If an employee has a problem regarding payment of wages and wins his case against the employer, the employer may be fined £1,000 but that is likely to militate against the employee in the long term. I have no doubt that an employer who is penalised for non-compliance with the provisions of this legislation will not readily forget the fact that his employee has brought him to court and exposed him in this way. That could be detrimental to the promotional opportunities of employees. There should be a register of cases that go before a tribunal, commission or court for investigation to ensure that in the event of an employee being successful against his employer that person is not victimised. That is a real possibility and is a matter that has to be addressed.

Section 9 gives the Minister for Labour power to appoint authorised officers to monitor compliance with the terms of the Bill. In addressing the financial implications, the Minister said there will be no extra cost involved and no significant staffing implications. How will the process he monitored and how will inspections be carried out if the staff is not available to do so? It is contradictory to say that the proposals have no significant staffing implications. Section 9 provides that the Minister may appoint authorised officers to monitor compliance with the terms of the Bill. I would like the Minister to explain how he hopes to achieve this. That provision is contradictory and will affect the implementation of the Bill.

If a company goes into liquidation and in that week an employee has been paid by cheque, does the employee have to wait until such time as the case comes before a court, which as we know, could take a long time? The lengthy waiting period would be a deterrent to anyone. If a company goes into liquidation, has the employee first call on any resources the company may have? What would happen in the interim, from the time the company goes into liquidation until the case is brought to court? Would the employee have to rely on the social welfare system? What safeguards does the Minister intend to introduce to ensure that in the event of a company going to the wall the employee who has given his service willingly will not suffer as a result? This is an extremely important point and there is no provision for it.

This is quite a short Bill but there are loopholes in it that will have to be addressed. The balance is very definitely in favour of the employer who will gain substantially. Can the Minister assure me that employees will not be out of pocket as a result of this legislation? If that should be the case it will be due to failure on the part of the Minister to deal even-handedly with the legislation. In future there will be more computerisation and companies will have less cash in hand. There is no insurance to cover the conveyance of cash from one point to another. For that reason they will gain handsomely from this legislation.

Certain measures will have to be taken to protect the rights of workers. I sincerely hope that the Minister will make changes on Committee Stage without any prompting from this side. Opposition Members will certainly table some amendments. I do not think the Bill calls for too many amendments, but some key changes are required, as the Irish Congress of Trade Unions have already intimated to the Minister. I regret very much that the Minister, despite the goodwill that prevails between his office and the Congress, has been unable to reach a suitable agreement with the Irish Congress of Trade Unions to encompass all the needs of the workers who will be affected by this Bill.

Dr. Hillery

In common with previous speakers, I welcome the Bill which reflects a growing consensus for change in the law relating to the payment of wages. As the Minister pointed out in his opening speech, the Bill is indeed historic because it repeals sections of the Truck Act, 1743, one of the last enactments passed by the old Irish Parliament in College Green before 1800 when the Act of Union changed all that.

The Payment of Wages Act, 1979, stopped short of a fundamental review of the Truck Acts. This Bill goes further. A high proportion of manual workers already avail of non cash methods of wage payment; two out of three workers do so, which is a substantial number by any standards. It is important to stress that those two out of three workers have negotiated agreements voluntarily under the free collective bargaining system. There is no question of this legislation or its predecessor imposing legal obligations on either side in relation to the payment of wages. The payment of wages is subject to negotiation in accordance with the fundamental institution of free collective bargaining that both sides want and practice.

Having said that Ireland is low down the league in relation to the proportion of manual workers who avail of non cash payment of wages compared to the proportion in continental Europe, it is true that our numbers are growing. Indeed, in our case there are several advantages. If the trend increases that much more, if a proportion of the remaining one-third who are not on non-cash payment of wages at the moment opt to follow that route, then the security risk attached to the transfer of large sums of cash for wages payment will be reduced. At the moment gardaí, the Army and security firm personnel risk life and limb when moving and supervising the movement of large sums of cash for the payment of wages.

Previous speakers mentioned savings in costs to employers if more manual workers opt into this scheme. It is true that costs will be reduced in relation to insurance payments, security arrangements and the use of computer facilities that are now widely in existence. In other words, it will be possible to facilitate the electronic transfer of cash by using computer capacity that typically already exists within companies. Furthermore, use of the computer as a method of electronic payment has clear benefits in terms of efficiency, economy and security.

If employers save by the move to non-cash payment of wages it is up to employees, and their trade unions, to negotiate a slice of those savings. Far from imposing legal obligations on either side in relation to the payment of wages, if anything the Bill provides a valuable framework for the exercise of free collective bargaining and for unionised employees to obtain as good a share of the savings made as they can. I might add that free collective bargaining and the absence of legal regulation, unlike British legislation in this regard, is fundamental to negotiations between unionised employees and employers. Indeed, it is a valuable worker right enshrined in legislation as far back as 1875 by an Act of the West minister Parliament. It is greatly valued by trade unions and is also preferred by employers as a means of negotiation.

I understand that under the 1979 legislation there are some 600 agreements relating to non-cash methods of wage payment. They are reviewed at intervals. Agreements are made between both sides and when the agreements run out the option exists, if the employee wants to take it up, to revert to payment of wages by cash. The Bill provides opportunity for both sides. Employers have an opportunity to buy out permanently under free negotiation in one lump sum the entitlement of manual workers to opt for non-cash methods of wage payment. By the same token, employees also have the opportunity to sell their entitlement at a negotiated price. The Minister, and the Government, are not in the business of legislating for what sums should apply to that exercise. That is a matter for free negotiation between the two sides. That system is supported through the action now taken under this Bill.

Section 3 has been somewhat contentious in relation to transitional arrangements for non-cash payment of wages. The Bill provides for employees to opt for continued payment in cash. It also provides that where there is an agreement under the 1979 legislation for non-cash payment of wages employees may if they so wish revert to cash payment of wages at the end of the period of that agreement.

As usual the Minister and the Government are faced with the task of striking a balance. It is the job of the Minister and his officials to listen to the Irish Congress of Trade Unions and to the Federation of Irish Employers, both of whom have their own case, and then strike an honourable compromise, the primary consideration being to make the legislation work and to improve the present position. By providing a breathing space in transitional arrangements, the Minister achieves and enhances the opportunity for agreement between both sides made within the voluntary framework of free collective bargaining.

A by-product of computer payroll systems is unity in the system of payment for all employees. I welcome that. That is not the primary intention of the legislation, but it seems to me that any measure — by-product or otherwise — that closes the gap between so-called white-collar workers and blue-collar workers is very much a step in the right direction. It is a move towards a single status of employees within an organisation, and that is important. The repeal of the Truck Acts today, which Acts spelt out the division between white collar and manual workers, removes distinctions between white-collar and blue-collar workers. It is the appropriate route to take in relation to contemporary work conditions, which should be more participative and democratic.

From research I have been involved in with companies I can confirm that when companies recognise people as their key resource one of the first issues they tackle is the distinction between white-collar and manual workers in order to provide a more equitable treatment of all employees. In its own way, the repeal of the Truck Acts facilitates that development.

Previous speakers made several references to financial institutions, the possible inconvenience that will be caused by the cashing of cheques, and so on. The Bill will promote greater contact between manual workers and financial institutions. In the Minister's opening speech he said that the encouragement of non-cash payment of wages would mean that more business would be driven into the hands of the banks. Of course, in that context one is referring to more than just the banks. Deputy O'Sullivan knows that An Post are a very important financial institution in Ireland.

On the question of hours, since the passage of the Act in 1979, the number of financial institutions and the range of their services has greatly increased. It is now possible, for example, to engage in banking with building societies. The Trustee Saving Banks are there as well. They have longer hours than the associated banks, and that will facilitate many people.

That is not to say that the points made by the Deputy are not valid. Obviously we will return to them on Committee Stage and I look forward to the debate at that stage. On the convenience front, there are 24 hour teller machines as well as flexibile banking hours.

There is one final point I would like to make relating to the role of the Rights Commissioner where manual workers have complaints about deductions from their pay. I should say straightaway that I regard the Rights Commissioner as an informal, speedy and successful service in handling individual employee problems. Its status makes for a welcome for that institution in the context of the Bill. For the first time in legislation the Rights Commissioner is now written into the Bill as a first stage or mandatory step in relation to complaints which, in turn, are related to deductions from pay or at least offences in that regard by employers. I think the sums involved will be very small if employers offend in this regard. Furthermore I think the number of offending employers would also be small, but that remains to be seen. Naturally it is important on grounds of equity for employers and employees to be able to appeal to the Rights Commissioner service if they disagree with the decision of a rights commissioner.

In conclusion, I welcome the Bill. I feel that it is a considered compromise, a balanced piece of legislation in the context of the differing views from employers and trade unions on this issue. Overall I see it as a valuable updating of legislation to match contemporary needs and conditions.

Mr. McGahon

I wish to make a brief contribution to this debate. In today's world of spiralling crime and terrorism it is inevitable that this Bill would see the light of day. I deplore the suggestions from my socialist friends that people would be allowed time off to cash their cheques. Why is it that trade union mentality seeks to equate work with——

Mr. Byrne

Reward.

Mr. McGahon

—— obstructionism? Surely every person in employment should be conscious of the value of employment when we have 250,000 people unemployed, and not make this an issue. It is that type of narrow mentality ——

(Interruptions.)

An Leas-Cheann Comhairle

Deputy McGahon, you will get a far quieter and respectful audience if you address the Chair and I will look after the interruptions.

Mr. McGahon

Is that type of mentality likely to encourage would be industrialists, would be entrepreneurs outside this country who look askance at the activities of Irish trade unions? Nit-picking to that degree makes me despair and I hope that some day the powers of trade unions will be severely restricted. The issue I really want to address is section 5.

Mr. Byrne

Fine Gael is alive and well. Here is the only honest Fine Gael-er in the House.

Mr. McGahon

It certainly is, and it is more alive than your party which died in eastern Europe recently.

An Leas-Cheann Comhairle

Deputy Byrne, every Deputy here is entitled to express his own views without interruption. There may be Deputies who at times disagree with what Deputy Byrne is saying, but they are obligated to contain their resentment and you have to do the same as far as Deputy McGahon is concerned.

Mr. McGahon

I am no admirer of banks and the way they conduct their business but I realise they are very necessary and while, horror of horrors, I certainly would not adopt the socialist attitude of nationalising them, I recently suggested at the Committee of Public Accounts that the banks were a group of vultures who would charge you to breathe, indeed they would charge you to blink. Undoubtedly this Bill will drive into their clutches a small army of people who have never had any dealings with banks. That is a regrettable feature of this Bill. Section 5 actually decrees that no employer is empowered to make any deductions from a person's wages unless authorised. If a person owes a bank money, will the bank, after a time, be empowered to touch that wage cheque to make deductions from it or possibly grab the whole cheque and leave some family without money for food? That is something I would ask the Minister to look at to ensure that that cannot happen. That is my particular concern and the reason I wanted to say a few words on this Bill.

I do not think that the banks should be entitled to take a penny out of any person's wage cheque. I would not trust the banks. I feel that by bringing a whole new area of business to the banks their exorbitant charges will be increased from time to time. Who will monitor that? Will the Minister or the Minister for Finance be invited to participate in discussions and negotiations on that or will the banks have carte blanche to do what they like?

The Irish banking charges are quite high but there are many people who manage their own finances well and do not have any business with them. I realise that banks are necessary. I know it to my own cost and I am not attacking them unduly, but there are many people who will be forced to deal with banks who would prefer not to. Given the nature of banks and the ever increasing need to increase profits I would have reservations about them. If they can identify this sector as a lucrative sector they will raise charges when they like. I would ask the Minister to address the problem I have outlined.

Minister for Labour (Mr. B. Ahern)

I thank Deputies who contributed to the debate. It was gratifying to see widespread support for the measures proposed. I look forward to the speedy passage of the remaining Stages of the Bill so that its provisions can come into force as soon as possible.

It is my aim to help effect the move to non-cash wages as speedily and as effectively as possible. The Bill will contribute to that process by helping employers and employees. Employers have a lot of gain financially in the short term and in the long term from a move to non-cash wage payments. They should not expect employees to agree overnight to a change without the goodwill of an employer being demonstrated in some way. Employees must show their goodwill too in the move to cashless wages. They must not stubbornly hold on to their ancient rights to cash payments without due cause. Employees will benefit from the change-over due to better business efficiency which will increase job security and the safety of employees engaged in handling of the payroll will increase.

Some Deputies suggested that people would lose their rights on the passage of the Bill. Under section 3 (2) all employees who are paid their wages in cash immediately before the commencement of this legislation can continue to be paid in cash under the existing contracts of employment until and unless they agree to one of the alternative methods of payment listed in the Bill. Agreements may be made between the employer and the employee or between an organisation representing the employer, such as the FIE, and an organisation representing the employee, such as a trade union or staff association.

Employees paid wages by a mode other than cash due to an agreement under section 3 of the Payment of Wages Act, 1979, will retain the right of revert to cash wages at the end of the agreement or where there is no termination date at any time, provided four weeks notice of intent to revert to cash wages is given to the other party. We intend to guarantee for the employees concerned, arrangements for reverting to cash wages similar to those which were accepted in 1979.

Some of the Deputies today missed the point that employees have a right to stay as they are. We are encouraging organisations to move but the legislation does not do away with anybody's right, as some Deputies suggested.

Mr. T. O'Sullivan

Would the Minister not agree that following the enactment of this legislation pressure will be put on employees to accept a cheque payment?

Mr. B. Ahern

Yes, but the pressure will be on both parties. Pressure will be on employers to stop hauling millions of pounds of cash around the country every week and they will be pressured to make agreements with employees. The legislation does not in an arbitrary way abolish the right of the employee to cash wages.

It would be entirely inappropriate in relation to our system of free collective bargaining if I were to write into the Bill, as suggested by Deputy McGahon, that people should get time off because of this system or that they should be paid for it. I would have to write into the Bill what an employee could expect from an employer in relation to free collective bargaining. Neither the trade union movement nor any employee would like me to set out in the legislation what an employee should get under the legislation. That is a matter between employees, their staff associations, trade unions and employers.

The two sides of industry will not be the only beneficiaries of the move to cashless payment. The banking fraternity can look forward to the optimum use of technology and to a possible new source of customers. In attracting those customers there may be scope for developing a personal friendly ethos. In the course of the debate there has been much criticism of the banks and the service they offer. Much of the criticism is justified. Some of their practices are as outdated as the legislation it is proposed to repeal in this Bill. The banking institutions should pull themselves into the 20th century by providing the type of service demanded by ordinary people today or they will be left behind other financial institutions who are expanding into the personal banking field and who are offering the type of service which will attract employees into the cashless economy.

On the last day, Deputy Shatter referred to a number of organisations and the services they provide. It is not only the banks who provide the service, but An Post, building societies and the Trustee Savings Banks, some of whom are open late at night or on Saturday morning. We are not talking only about banking services where the banks still have the luxury of closing their doors to the public at 3 o'clock every day, except one day. In negotiations people will take that into account. It is up to the banking institutions to change.

The Bill provides the legislative framework necessary to facilitate the move to non-cash payments. As with all changes, new attitudes must be fostered. Employers need to look at their present organisational methods and address the options for increased efficiency offered by a non-cash payroll and employees should be encouraged to seek information about the various kinds of non-cash services and the likely benefits.

In 1986 the UK introduced new legislation to repeal the Truck Acts and at that time many of the UK employers took the initiative in preparing employees for the move to non-cash wages. Some employers organised open days to which local banks and building societies were invited to meet employees and to explain their services to them. This approach may be suitable in some cases.

There is the important question of timing when it comes to managing any change. Change is often more acceptable when it occurs gradually or in pre-agreed stages. Perhaps employees who are anxious to move to non-cash wages might make the transition some months in advance of others, and their trouble free experiences of non-cash wages will no doubt filter through to their less open minded colleagues, giving them cause for reconsideration. We are trying to give everyone the opportunity to move, but it will take some time. We can be certain that the moves in this legislation will in time mean payments other than cash payments.

Deputy Shatter was the first of many Deputies to stress the importance of the Bill reducing the number of armed payroll robberies. This was one of the reasons which prompted a review of the existing legislation and, subsequently, the preparation of the Bill. While the number of armed robberies appears to have decreased in the last number of years they continue to be a problem. Indeed it was reported in the Irish Press on 7 June that the previous afternoon, the afternoon this debate began, two youths armed with a butcher's knife escaped with a £20,000 payroll when they held up staff in a building contractor's premises in the north side of the city. While such incidents are mild in comparison with other armed robberies they underline the importance for employers and employees of eliminating the associated dangers of large cash-based payrolls. The Bill will be of help in this regard.

Deputy Shatter also referred to a problem which was first highlighted by Senator ÓCuív in the Seanad regarding pay statements which are so abbreviated and complex as to make them virtually incomprehensible. As I have already outlined, I am in consultation with the Attorney General's office with a view to introducing a Government amendment on Committee Stage to clarify the legislation in this regard, if needs be. I want to assure Deputy Shatter that we are taking action in this regard.

The Deputy also referred to what he described as a new type of payment in kind. He instanced situations where computer companies give their employees a new computer every year or where some companies hold special business conferences in exotic locations for some or all of their employees. He regarded these practices primarily as forms of tax avoidance and asked if they would be legal under the terms of this Bill. There has been a long tradition in manufacturing industry of offering perks by way of company produce to employees. I am not too sure if Deputy Byrne was correct in regard to some of the benefits in kind given to employees. Breweries, distilleries and cigarette manufacturers, to name but a few, have, by tradition, for many years given company produce to their employees often as a gesture of appreciation towards them.

As to the legality of this practice after the enactment of this Bill, I would refer the Deputy to the definition of wages in section 1 and the list of modes of wage payment in section 2. Payments in kind are specifically excluded from the scope of this Bill by subparagraph (v) of the definition of "wages". Accordingly, section 2 deals only with money wages and sets out the modes by which such money wages may be paid. The giving of perks, such as those mentioned, are not wages for the purposes of this Bill but equally will not be outlawed by the terms of section 2. As long as the employee is paid his contractual money wage in the manner prescribed in section 2 of the Bill, the employer will be free to offer benefits in kind over and above that wage.

The role of the rights commissioner under this Bill will be to hear and decide on individual complaints regarding unlawful deductions or payments from wages. Deputy Shatter suggested a role for the rights commissioner service in the resolution of disputes between an employer and a trade union as to the compensation, if any, to be paid to employees for switching to non-cash wage payment. My view is that the assignment of such a role to rights commissioners would be inappropriate. Section 13 of the Industrial Relations Act, 1969, which established the rights commissioner service, precludes a rights commissioner from hearing a dispute involving a group of workers. The rights commissioner's role has always been and will continue to be connected with disputes involving individual workers.

The Deputies will be aware of my conviction that disputes between employers and employees are best resolved by the parties themselves. However, nothing in this Bill will prevent the parties calling in an independent third party to help in reaching agreements of this nature. This is the fundamental point. Indeed I would suggest that where problems arise in reaching these agreements, the Labour Relations Commission might be the most appropriate third party to call in. However, the Bill is deliberately silent as regards agreements to change over to cashless wages so as not to tie the hands of any party with unnecessary regulatory provisions in the matter of agreements which are, by their nature, local matters. It should be left to the parties involved to decide on the course they will take.

Deputy Byrne suggested that the Bill does not take account of the views and submissions made to me and that the legislation is rushed. I will not repeat the litany of dates the Deputy quoted. The arguments presented——

Mr. Byrne

I did not say this legislation was rushed in the context of the previous legislation. I said the Minister had not taken on board the submissions made to him.

Mr. B. Ahern

I decided four years ago to issue a discussion document on the Bill rather than present it in its initial stages. Since then all interested parties have been involved in discussions with me. I am not saying they agree with all aspects. As I pointed out last week, the ICTU are unhappy about some aspects of the legislation while the FIE are equally unhappy about other aspects. These matters have to be discussed by them. We have given them the forum and the legislative structure by which they can resolve these problems. Both sides would like not to have to go through that process and would prefer if I set out the conditions for them. It would be impossible for me to do this as I would have to come down on one side or the other, which is not in accordance with free collective bargaining. However, both sides understand that.

As I said during the debate in the Seanad, all the arguments presented during the consultative process involved in the Bill have been considered in the development of these proposals. I accept that there are a few sticking points in the Bill about which one side or the other have reservations. It is a measure of the balance achieved that both sides of industry, while assenting to the overall thrust of the Bill, for which I thank them, remain concerned that the interests of the other side may have been given a little too much weight. This switches from one side to the other in relation to different aspects of the Bill.

Deputy Byrne said that the old truck Acts were good law. While I agree with him, they have, as I am sure the Deputy acknowledges, outlived their time. I have tried in this Bill to take on board some of the essence of the philosophy of the truck Acts and transform it into terms which will be relevant to the late 20th century.

I listened carefully to the litany of disadvantages to employees identified by Deputy Byrne. However, there are benefits to employees too, for example, security advantages relating to the payment of wages by non-cash means. Employees who are entitled currently to wage payments in cash but who are not being paid in cash are entitled to revert to cash wages. Employees have the right to pay statements and there is the important new right of appeal in relation to deductions from wages. Indeed, some of these very benefits are the aspects of the Bill which the employers interests are vociferous in opposing. Deputy Shatter outlined these advantages eloquently and there is no need for me to go through them again. We cannot ignore the advantages of these benefits which employees receive. I hope these benefits will be taken into account by the people involved in the negotiations. It is not good enough for people to sit on the fence and allow for the payment of certain percentages.

Deputy Byrne asked about the position in other countries. The decision was made for the social partners in those countries by the introduction of legislation which banned these benefits. We opted not to do this as there are advantages to employers also, and the trade union movement, staff associations and individual employees have the right to trade to get some of these benefits. They have been very successful in doing this over the years whether by way of extra time off work, additional allowances, additional perks, etc.

From listening again to Deputy Byrne's concerns about cash paid workers one would not believe we are living in a country where 70 per cent of blue collar employees have bank accounts or that this Bill will guarantee cash wages. We would be insulting the intelligence of blue collar workers if we were to suggest that they do not have cash accounts. Blue collar workers in some of the biggest establishments already have substantial agreements with their employers. Funnily enough, some of the biggest enterprises in the State area still use cash or cheques to pay their employees. An employee can continue to be paid in cash until such time as he agrees otherwise with his employer. Because of the high level of bank charges, not every employee will decide to open a current account. At present credit transfers can be operated economically to a deposit account. The Deputy should look again at my earlier remarks on this issue.

Deputy O'Sullivan expressed concern at the possibility of workers being subsequently victimised in the event of their making a complaint regarding a contravention of the legislation. I would like to reassure the Deputy that in regard to prosecutions in respect of contraventions of sections 2, 3 and 4 of the Bill it would be a matter for the Minister for Labour to bring these prosecutions where the authorised officers found an employer to be in contravention of the legislation. Employers need not in those circumstances know the identity of complainants. I agree with the point made by the Deputy.

I thank Deputy Hillery for his contribution to the debate. He addressed some of the issues raised. I was pleased also that he pointed to the new role for the rights commissioner service, an interesting departure which escaped the attention of some Deputies.

Mention by Deputy O'Sullivan of authorised officers brings me to his question of an apparent contradiction in the Bill. As he pointed out, the Minister for Labour will be empowered to appoint authorised officers to monitor compliance with the legislation while no additional staff costs are envisaged in the financial implications. The duties of the authorised officers will be carried out by the labour inspectorate of the Department of Labour who perform similar duties under other employment legislation. It is in this way that no specific additional staffing costs are envisaged.

Mr. T. O'Sullivan

There is only one inspector monitoring compliance with existing legislation in Munster.

Mr. B. Ahern

As I said to the Deputy recently, that section has been expanded and a greater number of calls are being made. If there is a problem the matter can be reviewed at any time. All complaints received are followed up. The majority of these are made by persons who are not members of trade unions. It has always been the practice in the Department to ensure that persons who are not members of trade unions are given their rights, given that they have a greater need for the assistance of the inspectorate and have no one else to speak for them.

Deputy McGahon made a point about the banks but I must point out that the arrangements entered into between a person and a bank as to the repayment of a loan do not come within the remit of the Bill. The Bill addresses the matter of deductions from wages by an employer and provides an appeals procedure. It is not proposed in this Bill to influence deductions, if any, which a bank may make from a client's account on foot of an outstanding loan—this would open a whole new legislative area which in all probability would not be in the competence of my Department.

I thank Deputies for supporting the Bill. Naturally, I will examine all the points made today, but what is important is that we pass the Bill. I thank Deputy Shatter and Deputy O'Sullivan for their co-operation in this matter. It may take some years to move from a cash pay system to other forms of payment but it is our intention to encourage this. Deputy Byrne referred to the credit unions and the answer to his question is yes. If it is possible to have money paid direct to a credit union and an agreement is reached with an employer, then this will be another option.

Even in 1991 there are employees in some State organisations and firms in the private sector with a payroll of 1,500 people who are still paid in cash each week. My colleagues, the Minister for Justice who is present in the House and the Minister for Defence have to make vast resources available so that this money can be transported. This is unnecessary given the advances in technology. I hope following the passage of this Bill that the social partners will move quickly and conclude agreements in the best interests of the public, bearing in mind the threat to those working in wages offices who are living in fear. We may wish to ignore it but that is the reality. Workers told me during the course of discussions on this legislation which took four years to complete that they had switched over and that it had worked extremely well for them. Naturally, they want to get their pound of flesh and receive some remuneration from employers. That matter is open for negotiation.

I thank Deputies for their co-operation and look forward to taking the remaining Stages as soon as possible.

Dáil Éireann debate -
Tuesday, 18 Jun 1991