Unfair Dismissals (Amendment) Bill, 1993 [ Seanad ]: Committee Stage.

Section 1 agreed to.

I move amendment No. 1:

In page 3, before section 2, to insert the following new section:

"2.—Where a respondent to a claim for redress under the Unfair Dismissals Acts disputes that the claimant was an employee of the respondent, it shall be conclusive proof that the claimant was an employee of the respondent if it is shown to the satisfaction of the Tribunal that the respondent was responsible at law for deduction of the tax and social insurance contributions of the claimant.".

This amendment is to try to dispel some of the confusion that exists in regard to what constitutes an employee following the tests applied by the judges in the case law we have in this area. These tests have "splintered in the hands of the judges". I am seeking to ensure in as far as possible that an employee is covered under the Act. I am taking the guideline of the rights under the tax and social welfare Acts so that the test is whether the respondent is responsible at law for deduction of tax and social insurance contributions from the claimant. I deliberately use the term "responsible at law"; otherwise there could also be some confusion about that because the employer may not actually be making those deductions. The test ought to be whether he is responsible at law for so doing. I am seeking to cater on a statutory basis for the case where the person concerned may be deemed to be a contractor or a subcontractor.

The situation is not conclusive at the moment. I am aware of contracts being devised expressly for the purpose of circumventing the terms of the Unfair Dismissals Act, where it is included as an express condition of those contracts that the terms of the Unfair Dismissals Act do not apply. I presume these contracts are the result of professional advice and their stated purpose is to avoid coming under the terms of this Act.

The Minister may respond that this is already provided for, but in my experience and from the advice I have received from colleagues in the trade union movement it is acknowledged that in order to bring a valid claim under the Act claimants must be able to establish that they are employees for the purpose of the Act. An employee can be straightforwardly defined as someone who has entered into a contract of employment or a contract of service, but the Act defines a contract of employment as a contract of service or of apprenticeship whether it is express or implied and, if it is express, whether it is oral or in writing. Where the claimant's status as an employee is in dispute the burden of proving that status lies with the claimant.

The tests which are applied by the Employment Appeals Tribunal to establish the status of the claimant are based on the general legal rules developed by the courts to distinguish between employees and independent contractors under contract for services. It is difficult to fashion a useful general statement which would distinguish between employees and independent contractors. The courts in essence are attempting to determine whether the worker is working for himself or for someone else. In the Ó Coindealbhain v. Mooney judgment, delivered on 21 April 1988, the High Court, for example, considered the issue in the context of a case involving a dispute over income tax liability. In deciding that the respondent was not an employee “Blayney J”, having reviewed the authorities, based his decision on the fact that certain features of the contract were inconsistent with its being one of service. There is confusion and a dispute about it. The old employer-employee relationship is breaking down and has fragmented in many different ways. As a result there can be confusion and the person who considered that he had this resort in the final instance could find when it is too late that he does not have it. The third edition of The Worker and the Law said:

The reader who examines these authorities may end up agreeing with Lord Wedderburn when he wrote that "the legal `tests' have splintered in the hands of the judges, leaving them to say that it is `not practicable to lay down precise tests' or a `hard and fast list', that there are `too many variants' so `you look at the whole picture'. Most Courts now appear to use the `elephant test' for the employee — an animal too difficult to define but easy to recognise when you see it".

Will the Minister acknowledge that it is a fact of the structure of the workforce now that many people are employed as contractors and subcontractors, independent in the sense that they do not fall under the old definition of a contract of service, and that it is important that these people are given the protection of the Act?

Recently in my constituency 22 employees were let go because the company had gone into liquidation. It sprung up again under a different guise, showing that the Phoenix syndrome is still alive, and 19 of the 22 original employees have been given the option to return to work for the same employer doing essentially the same work, but this time under a contract which expressly provides that they will not have the protection of the Unfair Dismissals Act.

I support the general point being made. My amendment No. 3 simply recommends that in this case the Department of Social Welfare should be the deciding body. Concern in relation to practices in this area were expressed to me in discussions with the unions. There is a need for greater clarity and the procedures need to be tightened up. Deputy Rabbitte suggests that we should have regard to the tax and social insurance contributions of the claimant. Certainly the social insurance record and the nature of the contributions made would be highly relevant. Our two proposals overlap to a degree. Both acknowledge that there is a problem. Some employers will always seek to get around every protection for employees, but if we can strengthen the employees' protection and clarify the issues it would be a good thing. Those representing workers have issued a clear message that greater clarification is essential and that an amendment along the lines proposed by either Deputy Rabbitte or me may be required. I do not think this was an issue discussed at great length on Committee Stage in the Seanad. Perhaps the Minister may have had time to consider it and would indicate her willingness to take on board one or other of these amendments.

The one worry I would have about Deputy Rabbitte's amendment is that it might extend employment status to people, such as directors of limited liability companies in respect of whom at present PAYE and PRSI obligations are extended by the law. I would not like to give directors employment status. I would ask the Minister to consider between now and Report Stage something along the lines of what Deputy Rabbitte proposes, some simple test to determine whether one is in or out. My overall worry is that employment status should not be conferred on directors.

I accept the reasoning behind Deputy Rabbitte's amendment and that in the name of Deputy Flaherty. Sometimes it is quite difficult to determine a person's eligibility to bring a claim of unfair dismissal. In such instances, where there is that complexity, the Rights Commissioner or the Employment Appeals Tribunal explore all of the circumstances of the employment relationship before deciding on the identity of the various parties and on the claimant's entitlement. The amendment tabled by Deputy Rabbitte would direct the tribunal to reach a particular decision without allowing it the necessary flexibility to explore all of the circumstances of a particular employment relationship. I am sure many Members would agree with me that the tribunal has the necessary knowledge and expertise to decide such matters and that to tie their hands — which would be the effect of Deputy Rabbitte's proposal — would be unnecessary and perhaps hinder their work. I accept Deputy Rabbitte's motive in tabling his amendment and its worthiness but I think such matters are best left with the adjudicative body established under the 1977 Act.

I had expected a more considered and detailed statement either of rebuttal or acceptance by the Minister. She acknowledges that it is a serious point. The old master/servant relationship, as it was defined in law, is fast becoming the exception. There is a proliferation of contract employment under one guise or another. If I understood the Minister's reply correctly, other than conceding that it is indeed a phenomenon in the modern workforce, her argument for refusing to take my amendment on board is based on the desirability of the tribunal maintaining flexibility. I wonder whether that is a principle to which we can all subscribe. The Minister, like Deputy McDowell and I, has been in the House since the commencement of Question Time, when there was a question on the efficacy of the Employment Appeals Tribunal.

It is working.

It is working. I do not mean any pejorative connotation in saying that, but it is a matter of the efficiency with which it conducts its business. What we are seeking is certainty rather than flexibility so that the tribunal is directed by the law on what is the position and there is certainty about whether one falls within the protection of the provisions of the Act or one does not. I quoted some authorities to bear out the acknowledgment by academic lawyers that the tests had splintered in the hands of judges, so that certainty does not obtain at present. When one couples that with the fact that this kind of subcontract employment is proliferating, it is desirable that there should be certainty. The Minister may be unhappy with my drafting and might prefer to see her Department redraft it in a fashion that is acceptable to her. Perhaps she might provide for the point Deputy Michael McDowell raised. I agree that directors of private limited companies were not envisaged to be the subject or purpose of the amendment. I have no particular wish to proclaim the paternity of this amendment if there is some more agreeable form open to the Minister, but the point is an important one. The fact that the trade unions are not making a big fuss about this is neither here nor there. It only bears out the point that trade unions, of their very nature, represent people who are in traditional employment. The most vulnerable category of worker I seek to encompass in this amendment by and large do not have the protection of trade unions. The trade unions have not managed to organise this category of contract labour. These workers are more in need of that protection than members of a trade union who can vindicate their rights in the first instance through their union.

If the wording of my amendment is in any way disagreeable to the Minister, I would ask that she consider taking it for Report Stage, enshrining the protections which I and Deputy Flaherty seek.

Perhaps we should first hear the Minister's response to amendment No. 3.

We will deal with amendments seriatim. We shall be dealing with it shortly.

We may discover a certain breakthrough on that but, to an extent, it is encompassed within Deputy Rabbitte's amendment No. 1 because my amendment No. 3 simply suggests the Department of Social Welfare whereas the other refers to both the welfare and income tax regimes being involved in any decision.

The Minister suggests that allowing flexibility to the tribunal would afford greater protection to workers. If we were absolutely satisfied with that I would withdraw my amendment. Even though I am pessimistic about reducing the legalism that has already entered into the determinations of the Employment Appeals Tribunal, certainly an area such as this is fertile territory for legal argument, for clever lawyers being recruited by employers to argue every possible escape route. If the definition of "employee" is causing problems with non-traditional forms of employment becoming much more common, then the Minister must have some case law or evidence from the proceedings of the Employment Appeals Tribunal which would suggest that factors other than those being recommended by me and Deputy Rabbitte would somehow afford greater protection or, in some instance, would allow a person be designated as an employee whereas these definitions would not. If the Minister can prove that to me I will happily withdraw my amendment. his former colleagues in the trade union movement because it was ICTU that raised this point at my meeting with them as an amendment they would very much like to see. They consider it would answer a problem which is becoming more common within the context of cases being decided by the tribunal. Therefore, I urge the Minister of State to think about the matter again, if not today, before Report Stage, to see if she could be more flexible and accept an amendment along these lines.

In arguing that there is a need for certainty, Deputy Rabbitte quoted eminent legal opinion, but as soon as a law is made there is uncertainty. I am not a lawyer but common sense tells me that there is no certainty in law no matter how eminent the people who administer it are. We discussed this matter in great detail last night in the Department and I am of the opinion that the best way to meet the concerns expressed here is to allow the tribunal to send for documents and obtain information.

In looking at the terminology used in Deputy Rabbitte's amendment it occurred to me that one group of people who sometimes have great difficulty in relation to the Ombudsman are the teachers, who seem to be employed by a group of people who do not have anything to do with their salaries in terms of day-to-day deductions. The Department of Education is responsible for this.

They are made centrally.

This has had a most peculiar effect in that teachers have become employees of the Department of Education and therefore have no entitlement to protection under the Act. This matter will have to be thought out again.

I asked the Minister of State if there was any case law she was aware of that would support her contention that employees would be better protected if there was flexibility rather than by this narrower definition.

Under the law as it stands there is flexibility, about which I have spoken. Yesterday evening and last night we discussed the question of whether in the context of the Employment Appeals Tribunal there was any case law which would bear witness to the import of the amendment put forward by Deputy Rabbitte but we were not able to ascertain this.

What did Deputy Flaherty say? Did she ask if there was any case law that would support the Minister of State's argument?

No, putting one against the other.

Supporting the Deputy's argument that there is a need for greater protection.

There is a good deal of legal comment which shows that there is a lack of certainty. That is the point I am making. Therefore, one can quote case law to support either view.

What Deputy Flaherty wanted to know was if it came down one way or the other.

One can quote case law to support either argument, but it seems that it would be desirable to ensure certainty in the law. I would amend my words, in view of what the Minister of State has said, to say that, as I understand it, the purpose of making laws is to strive for certainty. We may not always achieve this but we strive for it. This is a good example of where we should try to achieve it. I am disappointed that the Minister of State has not agreed to look at the matter again before Report Stage to see if there is a formula of words which would make it acceptable to her.

I am not sure what Deputy McDowell's point is. It seems that if the taxpayer is paying the teachers through the Department of Education it is probably correct that they are the employees of the Department of Education, but I take the point that the amendment should include the words "for the purposes of this Act". I am not claiming precision for the amendment but I am trying to highlight a problem.

In legislation we strive for certainty so far as we can. The point I was trying to make was that judgments in whatever form do not often bear out what one tried to do in legislation. I am sure the Deputy would agree with me on that point.

Is the amendment being pressed?

I withdraw the amendment as I may wish to revive it on Report Stage.

That is the Deputy's prerogative.

Amendment, by leave, withdrawn.

We now come to amendment No. 2 in the name of Deputy Flaherty. I observe that amendment No. 22, in the name of the Minister, is related. I suggested that we discuss amendments Nos. 2 and 22 together.

Amendment No. 22 deals with employment agencies.

I move amendment No. 2:

In page 3, between lines 15 and 16, to insert the following:

"(a) the insertion of the following after `contract of employment' in the definition of `employee': `and includes agency workers or fixed term contract workers"'.

It was put to me, and it seems to be a reasonable point, that one of the main purposes of this Bill was to provide protection in law for categories of workers which have been excluded to date from the definition of employee by virtue of the fact that they are on fixed term contracts or agency workers. It is important that they should be included. The Minister's intention in relation to this group is clear. It is a question of ensuring at this early stage that it is stated precisely that they are included.

I thank the Deputy for tabling this amendment. Having referred to my own amendment, perhaps Deputy Flaherty will see that we have the one objective. Section 13 of the Unfair Dismissals (Amendment) Bill, 1993, as originally drafted, which was passed by the Seanad recently and debated here on Second Stage about two weeks ago, extended the scope of the unfair dismissals legislation to include persons employed through employment agencies. For the purposes of the legislation the party hiring the individual from the employment agency was deemed to be the employer.

This provision was drafted so that the extension of the protection of the 1977 Unfair Dismissals Act to workers placed by employment agencies would apply only to contracts entered into after the legislation comes into effect, that is, 1 October 1993. We need to be clear on this point as there seems to be confusion. On that basis therefore an agency worker working for a user firm at the time the new Act comes into operation would not be covered until a new placement contract would be made. On reflection it was considered that this would be unfair. Accordingly, the amendment to the Bill now put forward clarifies the matter that on the coming into operation of the new Act, that is 1 October 1993, existing agency workers will be placed on a par with future such workers in that as and from that date their service shall begin to count towards the calculation of the one year service requirement necessary to obtain protection of the Act. If Deputies wish, I will circulate the relevant note.

Under amendment No. 22 an individual who on the commencement date of the Act is working for an employment agency will be deemed as and from that date to be employed by the third party. Is that correct?

By the person using his or her services.

Is there anything in the amendment to stop such a person dismissing somebody in anticipation of the commencement of the Act?

That is where the difficulty arises — rumours and counter-rumours have been circulating.

If I was an employer and I had hired a secretary through an employment agency, is there anything to stop me sacking this person between now and the commencement of the Act?

No, this is what I am trying——

Can the Minister not retrospectively apply the provisions of the Bill to a certain day, say, today?

The Bill will not come into force until it is signed by the President.

The point I am making is that some "employers" will sack people in order to prevent them availing of this arrangement.

The provisions of the Bill will come into effect on 1 October 1993; these provisions cannot apply retrospectively. My amendment is an improvement on the Bill brought before the Seanad——

I appreciate that.

——in that the service contract of the employee in the user company will be deemed to begin as and from 1 October. The Deputy asked if I could introduce a provision which would prevent employers between now and 1 October getting rid of people who have been placed in their companies by employment agencies. I cannot do this as the provisions of the Bill will not become operative until 1 October.

I appreciate that; but, subject to correction, I take the view that it should be well within the Minister's remit to provide in the Bill that a person in these circumstances shall after, say, 1 June 1993 be deemed to be an employee of such a person. Therefore, if they were dismissed at some stage between now and 1 October they would have the right to commence proceedings after the enactment of the Act and to say "I am deemed by the Act to have been employed by this person and, therefore, to be unfairly dismissed".

I take the Minister's point that this amendment is an improvement on section 13. I also take the view that this is one of the most important matters covered by the Bill.

The entire employment agency question is very important; it follows on from the point made earlier by the Deputy.

Yes. There is a scandalous level of exploitation in a minority of cases. I very much welcome this amendment for that reason. With regard to the point raised by Deputy McDowell, is it not the case that we frequently pass Money Bills which take effect on a date preceding enactment? There are other precedents for deeming provisions of a Bill to take effect from a date preceding its enactment. We have experience of this. We are talking about a minority of employers who would exploit the system. It seems that the circumstances posed by Deputy McDowell may well arise. If we can close that loophole by way of amendment or reconstruction of the Minister's amendment then we should attempt to do so.

I can envisage IBEC issuing a memo which says: "If someone is in employment——

Such memos have been circulated already.

——on 1 October 1993 then he or she will be deemed to be your employee rather than an employee of the employment agency and our best legal advice is to the effect that if they are dismissed prior to that date they will have no redress under this provision but if they are dismissed the day after they will". I am worried that employers would be encouraged to take a decision consequent on the passing of this Bill.

As Deputies will appreciate, it is not usual for a Minister to introduce in the Dáil a substantial amendment to a Bill initiated in the Seanad. When the matter was brought to our attention we sought legal advice on what we deemed to be the correct formula. Of course, one always wishes to introduce perfect legislation. As the House is aware, people working for employment agencies were not covered previously and they had no redress. Under this Bill a person employed by a company through an employment agency will be placed on a par with the other workers in the company in that as and from 1 October their services shall be included in the calculation of the one year service requirement necessary under the Bill. On the question of Money Bills, that is a different issue. I have been strongly advised that the wording of my amendment is correct, bearing in mind that the Bill has yet to complete Committee Stage and Report Stage and has to be signed by the President. The provisions of the Bill will come into effect from 1 October next.

The amendment is an improvement on the Bill as it is currently drafted. It clarifies when the provisions of the Bill will come into force. It also clarifies that contracts in place on 1 October will be covered by the Bill. I understand that prior to this it was not clear whether existing contracts were covered. This Bill will increase protection for employees and employment agencies.

In addition to being present in the House for Question Time, I was at the meeting of the Select Committee on Social Affairs all morning. Therefore, I have not had an opportunity to examine the amendments in great detail; I am thinking on my feet on this matter. I do not think employers will be given an additional incentive to dismiss employees placed with them through an employment agency before the commencement of the Bill as these employees will only be covered from 1 October 1993. It is much more likely that the one year contract requirement will be applied before the enactment date of the Bill. I cannot see that this will weaken the position of employees; indeed it will strengthen it. I welcome the fact that it is now clearly defined who is an employee and this addresses to some degree the issues raised in my amendment. IBEC asked for clarity in the legislation and it was its wish that it would apply only to contracts after the section came into effect. It has got clarity but it has not got, quite rightly, its way in the law applying only to the future contracts between the user and the employment agency. I think we are going as far as we can, although I am in sympathy with the points being made on taking into account the earlier service of workers.

I must not be making myself very clear. I fully accept that this represents an improvement if it affects any individual worker. But as it is presently proposed there is nothing to stop an employer saying in September of this year "My goodness, on 1 October this new legislation will take effect and I will be deemed to be employing Miss so-and-so——"

If we are to impute motives such as that to employers, in fact they would wait a further 11 months from 1 October to so dismiss.

They may be encouraged to dismiss them this September.

There is no protection for such workers——

That is the point I am making.

We are bringing into law via this legislation protection from 1 October for workers employed through an employment agency.

I fully accept what the Minister has just said. I am now suggesting protection for workers between now and September from being dismissed by employers.

Is the Minister saying that eligibility under this Bill starts only from 1 October and that one must clock up 12 months' service from that date?

If we are to impute bad motives to an employer, an employer would wait 11 months on from October 1993, which brings us to September 1994, and he would sack everybody.

If paragraph (b) has the effect of commencing the employment on that date I am even more critical and reiterate my objections more strongly. If it has been decided as a matter of social policy that it is right to protect these people I cannot see why they are not given protection right now.

Let us suppose we are in Valhalla and we could bring in the measure right now, it would be a year before it would take effect, because what the Deputy has overlooked is that the legislation allows for a 12 month period before it takes effect. Even if I was disposed to make this provision retrospective from 22 June 1993, which I most certainly would not do, there would still be 12 months to run from that date because a 12 months period is allowed.

The original legislation, the 1977 Act, allows for a 12 month period and the amending legislation allows for a 12 month period.

I do not understand. If it is deemed to be desirable that people be protected why can their employment status prior to the commencement of the Act not be taken into account in determining their entitlements? In November 1993 why should somebody be liable to be dismissed because his or her "quasi-employment" is deemed to have started on 1 October? Employees should be protected straight away. Why are employers being given a period of grace to clear out their temporary employees? Why does the Minister not adopt a more radical proposition and say that anybody from today or from some other day, perhaps 1 June 1993, who is in this position is deemed to be entitled to protection if he or she is dismissed at any stage after 1 June 1993 before or after the commencement of the Act?

There is a 12 month period before the provisions of the 1977 Act apply, although I know some Deputy proposes to amend it to bring it down to nine months.

There is a 12 month period which we could call a "getting to know you" period for employers and employees under the 1977 Act and that has not been altered. I am not talking about agency workers but what applies between employers and employees——

Is it not Deputy McDowell's point that on 1 June a person may already have clocked up more than 12 months' service? The Minister's point is correct when somebody may only have three months' service on 1 June, but if on 1 June just passed a person already has three or four years service——

Does the Deputy mean renewable?

No, if the worker has been providing that service for the same concern for that length of time he should be covered by the Bill.

I accept the provision for a 12 month period, and that is valuable. However, there are people who have been on temporary contracts for two or three years and they are going to get no benefit from this and at some stage when this provision comes into force it will be open to the employer to clear them out before they get rights under the Bill when it is enacted.

Maybe after five years' service.

Even after five years. Heretofore most temporary employment of this kind has been in the low paid category and it tends to be women who are vulnerable. That is a fact, I think, but it is not universally so. A vulnerable group of people could have a number of years of service with an employer through an employment agency. That will be wiped out and forgotten about.

When one brings forward legislation one seeks to correct ills in the future. In legislation one seeks to bring in remedial action to combat abuses. In labour legislation one watches out for peoples' rights. In this Bill we are seeking to protect individuals in the type of situation to which the Deputy refers — most correctly in humanitarian terms. We have had advice from what I would call the highest levels of legal expertise and the drafting was done at the highest level. My objective is to see that the very cases of which the Deputy speaks do not easily obtain in the future. I do not propose to bring in legislation that would be retrospective and would not stand up to challenge. The Deputy referred to clogging up the Employment Appeals Tribunal.

There is a great deal of codology talked about retrospective legislation. It is prefectly in order and there is nothing unconstitutional in saying that where somebody has had three years' service with an employer through an employment agency at a time prior to the passing of an Act he will be deemed, in cases of dismissal after the commencement of the Act, to have been in the employment of that concern for those three years. There is nothing unconstitutional about that. If Mrs. So-and-So has been a typist employed through an employment agency with a company for the past three years, I can see no legal or constitutional objection to saying that her service in that capacity can be deemed to be employment service for the purpose of giving her rights because of her 12 months' service with her employer. That is the point I am making. I see no reason that that should be so. There is a great fear in this House about retrospective legislation. The Constitution only states that a law cannot be introduced which makes something an offence retrospectively.

That is exactly what the Deputy is saying.

There is no offence here, this amendment is seeking to confer a right. When you come to look at whether somebody is entitled to protection under the Act, I propose that you should be retrospectively entitled to look at their record of employment through an agency at a time prior to the commencement of the Act in order to determine whether they should be given rights immediately the Act comes into effect. I do not see that there is anything radical or odd about that. If I were drafting the Bill I would do it in that way and I would put my money on it that no court would touch it or interfere with it in any way.

We are seeking to do exactly what the Deputy has said immediately the Act comes into effect on 1 October. I am glad I am bringing in this Bill and that we are improving to a great extent the lot of workers who have been wrongfooted by many employers over the years.

I fully accept that the Minister is improving the position but she knows as well as I do that on 1 November a person can be sacked and under paragraph (b) of amendment No. 22 that person will not be deemed to have had anything more than one month's service with the employer even though that person has been sitting in that employer's premises for three years, or whatever, and should have rights conferred immediately and should have their service, prior to the commencement of the Act, taken into account immediately.

The 1977 Act gives to all employers and employees that period of grace — the "getting to know you" period — of which I spoke, of 12 months. An amendment has been tabled to have that period altered to nine months. I am not disposed to accept what Deputy McDowell has said and I hope the House will agree to my substantial amendment No. 22.

The Minister did not comment on my amendment but indirectly suggested it was unnecessary.

What are Deputy Flaherty's intentions in regard to amendment No. 2?

I accept that the Minister's amendment clarifies the definition and clearly includes agency workers in the same terms as others. Would it not be a neater or a more common drafting practice to have the definition at the commencement of the Bill?

No, it is more substantial to have it in the body of the Bill, as we have done.

Is Deputy Flaherty withdrawing her amendment?

With respect to Deputy Flaherty, her amendment is substantial and has been subsumed in part by what we have put forward.

Would the Minister consider a Report Stage amendment?

I will not be considering a Report Stage amendment on this matter. Has the Deputy tabled an amendment on it?

Why can the Minister not consider an amendment? I know the Order of Business this week is pretty farcical and I know we are plumbing new depths of rubberstamping legislation this week, but to be told in advance that the Minister will not consider any amendments is a new high in arrogance, with the greatest of respect.

The Deputy himself is pretty farcical.

Amendment, by leave, withdrawn.

I move amendment No. 3:

In page 4, between lines 17 and 18, to insert the following:

"(4) Any dispute concerning the employment status of the employee should be determined by the Department of Social Welfare.'.".

There are two substantial amendments and with good time management we may be able to reach Deputy Rabbitte's amendment in relation to the substitution of "nine months" for "one year" and my own amendment in relation to pregnancy-related dismissal of employee.

They are not connected, as Deputy McDowell points out.

They are not connected but they are two issues we would like to discuss.

They are both of a gestative nature.

We have only an hour.

We do not have an hour, we have only until 6.45 p.m. That is the order of the House, not mine.

Are we finishing at 6.45 p.m. on the assumption that there will be a vote?

I do not know. That was read out on the Order of Business. If the Deputy called a vote earlier that would have wasted 20 minutes.

We called a vote on the order at the time, but never mind. We went through the arguments in relation to amendment No. 3 on amendment No. 1, so there is no point in repeating them but I would like to hear the Minister's comment. It is an issue we hope the Minister will resolve.

Section 8 of the 1977 Act provides that a rights commissioner or the Employment Appeals Tribunal should hear claims of unfair dismissal brought under the Act. I understand that it is normal for a rights commissioner or the tribunal to establish at the outset of a hearing that a claimant is entitled to bring in the claim that the person meets the necessary qualification requirements of the legislation. In deciding on a claimant's entitlement to bring a claim the rights commissioner or tribunal would have to determine that the claimant was in fact an employee within the meaning of the Act and as such entitled to bring a claim. Deputy Flaherty's amendment appears to propose to shift that responsibility to the Department of Social Welfare. I do not consider such a proposal to be in the best interests of either the employer or the employee or, indeed, of the tribunal. I consider it is appropriate that the determination of all aspects of a person's eligibility under the Act should rest with the adjudicative authorities. That is more or less what was said on Deputy Rabbitte's amendment.

I am pressing the amendment but not to a vote. This issue needs to be examined and I would like to hear what the Minister will say on Report Stage. This issue has been raised by unions and representatives of workers with people on this side of the House. They are the people who are protected under this Bill and are being given rights under this Bill. If they are concerned and feel that this would be an improvement it deserves very serious consideration.

Amendment put and declared lost.
Section 2 agreed to.

I move amendment No. 4:

In page 4, between lines 18 and 19, to insert the following:

"(a) the substitution of `nine months" for `one year's' in paragraph (a) of subsection (1),".

I agree with Deputy Flaherty that her amendment on pregnancy-related dismissal is an important one and we should try to reach it. It is a pity we are forced into this situation where we cannot discuss some important aspects. I have tabled an amendment, which is very close to my heart, it concerns the dismissal of parliamentarians.

Is it in connection with elected Members?

My colleague, Senator Sherlock, sponsored it in the Seanad. In certain employments in this country one can be dismissed for being elected to Dáil Éireann.

That applies to Deputy Richard Bruton.

I had hoped the Minister would have accepted it.

I gave a very spirited reply in the Seanad.

I read it and I was impressed, but I would be a great deal more impressed if it were enshrined in the Bill.

I would be more impressed if the Deputy pressed it on the Electoral Bill.

Amendment No. 4 seeks to bring down the threshold from 12 months to nine months to allow for protection under the Act. For people encompassed by the Act it has worked reasonably well. More and more contracts have been devised with the express purpose of avoiding that provision in the Act; in other words, it has now become customary to my knowledge — and this has been a frequent occurrence — that people are employed for 11 months, or 11 months and three weeks, or 11 months and one week and then let go for a week and re-employed under the same contract again purely for the purpose of circumventing the Act. That is unfortunate.

I accept the Minister's point about the "getting to know you" period which is typical in most employments where a probationary period is habitually three months, but it can be for six months. That is a reasonable period from the employer's point of view. However, once an employee on probation is deemed suitable for the employment it is fair that the cumulative duration of the probationary period should be taken into account. A total of nine months as the qualifying threshold under this Act is a reasonable reforming amendment. Employers could not claim that such a period is excessively generous and the arguments Deputy McDowell made in relation to agency workers apply in this case. In the Seanad, the Minister referred to the position in Great Britain where a period of two years is required under the law. In my naivety I once compared the Minister to Margaret Thatcher.

To which I bridled satisfactorily.

She quickly reminded me that no such comparison could be made and, therefore, I hope she is not telling me now that she is basing our labour legislation on Thatcher's Britain——

I said that a two year period applied there.

——and that the two year threshold which applies in Britain is the exception in the OECD countries and in the European Community. My amendment is a modest reforming one and I ask the Minister to accept it.

I support Deputy Rabbitte's basic motivation but I oppose the proposed reduction from 12 to nine months. In that case, it might as well be reduced to six months or abolished altogether. Section 3 purports to allow the rights commissioner, the tribunal or the Circuit Court, as the case may be, to disregard a fixed term contract if it is believed that the fixed term contract was entered into for the purposes of avoiding the unfair dismissals code. Under section 2 of the original Act if somebody on a weekly contract is dismissed in the eleventh month and re-employed one month later, the question arises as to whether such people are being treated unfairly.

We had a lengthy debate on that matter in the Seanad.

If I have a three year contract with an employer and when I sue for unfair dismissal it is envisaged that the three year term was applied to prevent me having rights under the Unfair Dismissals Act, it seems unfair that a constitutent of Deputy Rabbitte's who may have worked for a period of 11 months can be dismissed and re-employed one month later because his or her contract was not a fixed term one. It is unfair that a person can be re-engaged after a lapse of two or three weeks and deprived of protection under the Bill. Why does the Bill not provide the same right to disregard a temporary cut in service to ordinary open-ended contracts where a tribunal finds that the break in service was motivated by a desire to escape the provisions of the Bill?

I understand that all contracts of employment are covered by the three month gap; if a person is re-employed within three months the contract continues.

It does not. It is only a fixed term contract under subsection (2) and it is not an open ended one.

In that case, the Deputy has made a very valid point. If a person is returned to employment under the same contract and by the same employer, the protection of this proposed Act should extend to him or her. I have an open mind in regard to the proposed nine month period. The trade unions have been seeking a six month period and small businesses, in particular, have suggested that we should consider the British example. As an employer, it is my understanding that in most employments a six month probationary period applies, but a permanent employee with no protection is in an anomalous position. Such a person might be protected by in-house agreements or union negotiations if he or she had a grievance between six months and one year. However, people who have completed their probationary period but are not fully protected under the laws of the land are in no man's land. It is only after a period of approximately nine months that an employer will decide whether he wishes to retain an employee in the long term. Therefore, this amendment might shorten the time in which an employee proved efficiency. Very often an employee might not have settled in properly after a period of six months and an extra few months would give them an opportunity to learn the job and prove their merit. This argument cannot be easily resolved. I understand the Minister has certain powers to deal with this by way of regulation and it could be appropriately discussed in relation to a programme for national recovery and consensus reached in that way. There is merit in Deputy Rabbitte's amendment, but it is not an absolutely proven case.

I do not know whether or not the Deputy is agreeing with Deputy Rabbitte.

The jury is out.

This matter was dealt with at great length in the Seanad. The Principal Act provides that subject to certain exceptions the Act will apply to employees who have at least one year's continuous service with the same employer. Deputy Rabbitte's amendment proposes to reduce that requirement to nine months and Senator O'Toole made a similar proposal in the Seanad. The question of the length of the service requirement was examined in detail when this Act was being reviewed in the context of this legislation. On the one hand, the employer bodies wanted the service requirement increased to two years while employee representatives wanted it decreased to six months. I consider that the circumstances that gave rise to the provision of a one year requirement in 1977 have not changed. Those circumstances include giving to an employer an adequate opportunity to assess the suitability of an employee for the employment concerned and the requirement that an employee serve with an employer for a reasonable period of time before becoming eligible for the significant protections afforded by the legislation. I do not propose to make any change to the service requirement of the Bill.

Regardless of how many months applied if employers to not wish to retain employees they will always apply a period of less than the required period. If a nine month period applied, employers could apply an eight month period and so on. If an employer wished to get around the legislation he could circumvent the time period and a reduction from nine months to six months could be easily cirant' cumvented. The House may wish to note that there is a provision in the 1977 Act allowing the Minister of the day to change by order the length of the service requirement and if, in the course of my duties, it becomes evident that circumstancs have changed in such a manner as to justify an amendment to the service requirement, I would be open to consideration of any alternative arrangement that may be required in those circumstances.

To answer Deputy Rabbitte, I never did aim to be like nor do I want to be like Madam Thatcher. The point I was making was that the time limit in the UK is two years. In a very smart way the Deputy did not mention that I said that the limit in Denmark was also two years. I can see by the Deputy's grin that he has read it. Denmark, the soul of socialism, has a two year requirement. Deputy Flaherty made the point that small businesses in the UK were protected.

I was opposing it.

That idea was mooted to me, but I do not think it would be right to have one labour law for smaller businesses and another for larger businesses. There are rights for employers and rights for employees and I do not think they would be well served by treating small businesses differently.

In regard to the amendment put forward by Deputy Rabbitte, I am not disposed to bringing the limit down to nine months because that in turn would be abused.

I note that the Minister did not reply to any of the points I made and perhaps I will raise them again with her. As I see it, one of the purposes of this Bill is to disregard the fixed term nature of a contract if the tribunal is satisfied that the purpose of fixing a term was substantially to avoid the application of the Act. That is the purpose of section 3 (b) in this Bill. I reiterate the objection I have and ask the Minister to reconsider it. Does it not make sense that the tribunal should have power to disregard a dismissal and a recommencement, quite apart from fixed term contracts and open-ended contracts, where the tribunal considers that that was done for the purpose of avoiding the application of the Act?

I know what the Deputy is getting at but, with respect to the Deputy, he is at the wrong section of the Bill.

The only reason I raised this was that Deputy Rabbitte was suggesting bringing the 12 month limit down to nine months. I made the point that the Minister herself made, that moving the goalposts will not stop people scoring goals whenever they want to. We are here dealing with a different matter and I am asking the Minister now, if she really believes that fixed term contracts should be looked behind in certain circumstances, to reconsider the matter. It applies equally in regard to Deputy Rabbitte's amendment. The evil he was looking at should be looked behind as well.

That point is covered under another section. However, I am free to answer it. In regard to the Deputy's point about someone who is dismissed after 11 months, that person is not covered by this legislation but can go to the Labour Court under industrial relations legislation. Let me say something else to Deputy McDowell while I am on my feet. The Deputy alleged earlier that I was arrogant because I would not agree to take an amendment from him on Report Stage. The Deputy does not have an amendment down on Committee Stage nor does his party.

I am standing in for Deputy Cullen.

There are 22 amendments and not one of them is from the Deputy's party. I have sought advice from the Clerk of the House and he tells me that if there is not an amendment on Committee Stage an amendment cannot be brought forward on Report Stage.

A curious thing arises. To go back to what Deputy Flaherty said, we in this House were told by the Government of which the Minister is a member that committees would handle the Committee Stages of these Bills. That was the great improvement we were promised. The four of us are now sitting in this Chamber and much more valuable work, such as the Sexual Offences Bill, could be done in this Chamber if we were not here.

That is probably why we are here.

As Deputy Flaherty points out, that is probably why we are here. We are here sandbagging the Government from being embarrassed and having extra time on its hands. We are in the position of considering a guillotined debate which the Minister voted for here today and which her colleagues insisted on despite the suggestion that it was unfair. We are having a guillotined debate this afternoon in circumstances where this Committee Stage should be dealt with by a Committee of this House when there would have been plenty of time for everybody to put down their amendments and Deputy Cullen would have been in a position to attend.

That is another issue. The Deputy said that I was arrogant because I would not take his amendment on Report Stage. The Deputy does not have an amendment. Among the 22 amendments on the Order Paper, the Progressive Democrats do not have one. I quite understand that Deputy Cullen might have to be away but the Deputy's party is not represented by amendments.

We do not have to have an amendment.

This debate is drifting away from the amendment. We should be dealing with amendment No. 4.

On a point of order, I do not have to have any specific amendment on Committee Stage, nor does anybody from my party, in order to put down a Report Stage amendment. It is either admissible on Report Stage or it is not. Who tendered an amendment on Committee Stage is irrelevant to tendering an amendment on Report Stage.

That is not the information I have been given.

The Minister is wrong about that as well.

It has come from here, from the House.

I am anxious to facilitate Deputy Flaherty's amendment, which I think is an important one. Where it can be seen from the evidence that somebody has deliberately set out to circumvent the terms of the Act by dismissing the person just before the time limit, what is the Minister's attitude to giving the tribunal the powers to say that an employer is liable under the terms of the Act because he has deliberately set out to circumvent it?

I have said already that that is dealt with in section 3.

It is not. With the greatest respect to the Minister, would she read her amendment? That only applies to fixed term contracts. It does not apply to open term contracts which are suddenly terminated by a dismissal. That is the point I tried to make to the Minister. If she spent less time lecturing me about the procedure in this House and more time listening to the substance of what I have said she would have taken on board that there is a loophole in the Act. I have only pointed it out and I have been subjected to nothing but abuse for failing to take the Minister's points on board.

Would the Minister be amenable on Report Stage to giving the tribunal that power?

We will look at the matter.

It is, incidentally, one of the greatest sources of grievance for an unfortunate employee to find, after he has been dumped out, that he is not covered by the Act after all. The first time that the average employee hears about this is when he is in a situation where he needs to have recourse to it. He does not know about the year's requirement, etc. It seems that the Minister would have the best of both worlds. She would leave in this year's requirement, but in a situation where someone would set out to deliberately circumvent the Act he would be amenable to it. This seems to be a good way around the loophole in the Act.

It can be discussed again on Report Stage.

How can the Minister discuss it if there is no amendment down?

It is Deputy Rabbitte's amendment.

Amendment, by leave, withdrawn.
Section 3 agreed to.
Section 4 agreed to.

I move amendment No. 5:

In page 6, paragraph (a), line 31, before "membership" to insert "the employee's".

This is a technical amendment which was accepted in the Seanad. The effect of it is to include in the list of automatically unfair reasons for dismissal an employee's membership of the travelling community. The wording of the amendment put forward in the Seanad was subsequently found to be at variance with the rest of the Principal Act in that it made no specific reference to the employee. I am therefore proposing this technical amendment specifying the employee's membership of the travelling community as being an automatically unfair reason for dismissal.

Amendment agreed to.

We now come to amendment No. 6 in the name of Deputy Flaherty. Amendment No. 8 is an alternative. It is therefore proposed to take amendments Nos. 6 and 8 together. Is that agreed? Agreed.

I move amendment No. 6:

In page 6, paragraph (a), between lines 31 and 32, to insert the following:

"(eeee) the pregnancy of the employee or any matter connected therewith,',".

I welcome the opportunity to speak on this amendment. It relates to one of the most important issues not dealt with in the Bill. I also welcome the amendments conceded by the Minister in this section, the original proposal to include sexual orientation, race and colour and the concessions in relation to age and membership of the travelling community. However, the Bill is incomplete without provision for the concession in this amendment because it is clear that pregnant women experience difficulties in the workplace. While they cannot be directly dismissed as a result of their pregnancy many restrictions associated with it cause difficulties. I refer to women working on equipment which is unsafe to use during pregnancy and whether employers are obliged to make efforts, where possible, to find more suitable employment, which is often available, for those women. Catering employees, at certain stages in their pregnancy may find heavy work, for example, waiting on tables unsuitable but employers may not provide more suitable employment for them, which may be available. There was a high profile case where a pregnant woman who was employed as a teacher was dismissed because she was unmarried and in a second relationship. That is a different area but this may be the only opportunity to address such matters and, therefore, we might as well put all the issues on the table. This amendment is comprehensive. It suggests that neither the pregnancy of the employee nor any matter connected therewith could be used to dismiss a person and, if it was attempted to do so, that the dismissal would be essentially unfair. The absence of this provision highlights a weakness in the Bill and I hope the Minister will accept this amendment or amendment No. 8 which is similar although it may not be as broad in its definition.

I support Deputy Flaherty's amendment as I sought to achieve the same effect in amendment No. 8. I do not know which amendment the Minister prefers but I am sure she is totally supportive of this amendment. I cannot conceive of the Bill being enacted without the Minister agreeing to this amendment because the law as it stands is flawed through error or — although one would be reluctant to say it — deliberately. Whereas pregnancy is a good defence against dismissal, nonetheless, as a consequence of pregnancy, a women can be dismissed because she is deemed not fit to carry out the functions of her job, that is a terrible oversight in the law. I presume the Minister will give a positive response to one of these amendments. In addition to there being a flaw in the law as it stands——

Is the Deputy referring to the 1977 Act?

Yes. The European Community Directive will have to be implemented and incorporated in domestic law to ensure that a woman cannot be dismissed during pregnancy or while on maternity leave. I would have thought as the directive was enacted in October 1992 and since we are now dealing with the Bill, that this would be the place to ensure that its import is taken on board. I have strong views in regard to this matter. Because I had direct experience of women losing their employment for all kinds of trumped up reasons when the main reason for their dismissal was their pregnancy and that their duties involved lifting or physical effort. Under the existing law it was impossible to establish that the person was dismissed because she was pregnant. The distinction between being pregnant and being dismissed as a consequence of being pregnant is an area where there must be certainty in the law and I hope the Minister will take on board the import of what we are trying to do here.

Deputy Rabbitte referred to the EC Directive. If one were to take on board either or both of the Deputies' amendments the woman would be worse off. I will explain the position in this regard. The EC Directive is due to be enforced in October 1994 and its ratification is the responsibility of the Minister for Equality and Law Reform as laid out in the Programme for Government. The EC Directive provides that where a risk assessment, to which Deputy Flaherty referred, reveals a possible danger to the health or safety of a pregnant worker, that worker must be transferred to alternative duties and if a transfer is not possible special maternity leave, to be paid for by the employer and/or the State, must be granted. We look forward to October 1994 when the directive is enforced. A pregnant woman will not have to appeal her case to the Employment Appeals Tribunal if she considers she was dismissed from work because she was pregnant.

During the debate we heard that following such appeals, many women take their compensation awards and do not return to work, perhaps because of the small intimate nature of Irish business, but that is another area. Neither of the Deputies' amendments would succeed in protecting the woman to the same extent as the EC directive. Their amendments provide that such a position would be automatically unfair, that the woman would have a strong case and be entitled to bring it to the Employment Appeals Tribunal. The EC Directive provides that where a risk assessment reveals a possible danger to the health or safety of a pregnant worker that worker must be transferred to alternative duties and, if a transfer is not possible, special maternity leave, to be paid for by the employer and-or the State must be automatically granted. It is essential, therefore, that in the interests of women we do not rush to amend the Act without a detailed examination of the new and complex issues raised in the directive as regards risk assessment, transfer to other jobs and entitlements to leave and pay, all of which will provide for the automatic retention of the woman in her job.

This is from the Saint Augustine's school of industrial relations.


As Deputy Rabbitte is aware, I am not introducing this matter.


The Minister is providing for the woman to be worse off.

The woman would be worse off as a result of the deputies' amendments. Under the EC Directive she will be much better off.

The EC Directive is not yet in force. This amendment will not affect it.

I have just explained that it will be effective in October 1994. Those issues must be adequately resolved and the necessary measure to implement it must be included in comprehensive legislation to be introduced in 1994 as required by the directive.

I do not accept what the Minister said. I do not know how she cobbled that together between the Seanad and this House. I know this is an embarrassing issue for the Minister and that she must have great difficulty in agreeing to it because as a Minister, proud of her record in this area, she must be anxious to give the protection provided in those amendments to women. The Minister is trying to make us believe that if we were to enshrine Deputy Flaherty's amendment or mine in law it would stop the directive which will be incorporated in the domestic law and then, I hope there will be no need for those amendments. I would lay a wager with the Minister that there is no prospect of this directive being law here in 1994. If it is it will be one of the first law directives in the area of labour legislation to have been implemented on the due date. It will drag on and on and in the interim, if we are amending the Unfair Dismissals Act, we have an obligation to protect women——

For the next 12 months.

——for the next 12 to 18 months even if the Minister's best dates were met, which I believe they will not. The Minister should deal with this matter more frankly because to argue that it makes the position of the woman worse or inferior is not true.

It would greatly improve the position of women between now and the time of the EC directive becoming law.

I cannot accept the Minister's argument in this case. We all look forward to the additional protections provided by the EC directive and I imagine they will be included in the Maternity and Employment Act in this area. An amendment or clarification of the Unfair Dismissals (Amendment) Bill is required immediately to protect women in the interim. It would be required anyway in the long term to clarify that matters associated with pregnancy can never be grounds for a fair dismissal — in other words, that that would be an unfair dismissal. Like the Minister, we hope that many women will not face that situation, but in the meantime this issue must be resolved within these Acts. To suggest that passing this amendment would in any way inhibit wider protection is being less than honest and is covering up for a failure to act under this legislation. I wish to press this issue to a vote.

Deputy Rabbitte mentioned that I would not have this legislation into law by 1994. I will not be bringing it in. It will be introduced, as per the Government arrangement, by the Deputy's constituency colleague, the Minister for Equality and Law Reform, Deputy Taylor.

I hope the Minister for Equality and Law Reform is not impeding equality.

Not at all; he is speeding it up. If any Minister will introduce legislation by the due date, it will be the Deputy's constituency colleague, Deputy Taylor, due to his dogged perserverance.

We have not seen anything from him yet. I will take the Minister's word for it.

He is gestating nicely. With regard to the particular amendment put forward by Deputy Flaherty and Deputy Rabbitte, may I suggest that we would discuss the matter on Report Stage?

It is Deputy Flaherty's amendment, but is the Minister signalling a willingness to——

Pow-wow further.

——pow-wow further and bring something forward on Report Stage?

Perhaps the Minister is avoiding a vote.

I would like to be assured of the Minister's sincerity, but it is such an extraordinary transformation, in less than three minutes, from total rejection to——

Report Stage does not mean certainty.

That is my concern. It is an issue on which we should register concern and I wish to put the matter to a vote.

I would be willing to discuss it on Report Stage, with no guarantee of certainty, but if the Deputy wishes to press the matter to a vote that is her privilege.

In the event of Deputy Flaherty pressing the matter to a vote I reserve the right to re-enter my amendment No. 8 on Report Stage so that the Minister and I can continue to pow-wow. Deputy Flaherty can make an important point in the interim.

That is a point of procedure of which I was not aware.

As it is now 6.45 p.m. I am required to put the following question in accordance with an order of the Dáil of this day.

On a point of order, a Leas-Cheann Comhairle, it is not 6.45.

We had this problem in the House previously. Deputy Flaherty gave the Chair clear notice that she wished to call a vote on this matter and she has the right to do so.

I will clarify the matter for the Deputy. Deputy Flaherty did not indicate her intention in response to the question from the Chair. The Chair was not requested to put the question. We did not reach that stage. I have no discretion in the matter. I am acting, as I am required to do, on the order of the House of this day and I will now proceed with the duty that is required of me.

Question: "That the amendments set down by the Minister for Enterprise and Employment and not disposed of are hereby made to the Bill; in respect of each of the sections undisposed of other than section 13, that the section or, as appropriate, the section as amended, is hereby agreed to and that the Title is hereby agreed to" put and declared carried.

When is it proposed to take Report Stage?

On Thursday, 24 June 1993.

It is not agreed that Report Stage be taken on Thursday, 24 June.

Question: "That Report Stage be ordered for Thursday, 24 June 1993" put and declared carried.
Report Stage ordered for Thursday, 24 June 1993.
Sitting suspended at 6.45 p.m. and resumed at 7 p.m.