Dáil Éireann debate -
Thursday, 19 Oct 2000

Vol. 524 No. 4

Industrial Relations (Amendment) Bill, 2000 [ Seanad ] : Second Stage.

Minister of State at the Department of Enterprise, Trade and Employment (Mr. T. Kitt)

I move: "That the Bill be now read a Second Time."

This Bill provides for a new dispute settling power to be given to the Labour Court to enable it to investigate a dispute and issue findings which ultimately can be enforced through the Circuit Court. This new dispute settling power will apply in cases where collective bargaining arrangements are not in place and the parties are not engaged in talks.

During the discussions on Partnership 2000, both the Irish Congress of Trade Unions and the Irish Business and Employers Confederation, IBEC, in the context of modernising our industrial relations procedures and institutions, agreed to devise a mechanism for resolving such disputes. A high level group was established to consider detailed proposals from congress on the recognition of unions and the right to bargain.

The group consisted of representatives from IBEC, ICTU, the Departments of Finance and Enterprise, Trade and Employment, IDA Ireland and Enterprise Ireland, and was chaired by an official from the Department of the Taoiseach. It issued a set of proposals in December 1997 which were not accepted by the trade unions generally. The Ryanair dispute highlighted the importance of developing solutions for similar disputes in the future. In December 1998, following publication of the report of inquiry into the dispute at Dublin Airport and the Supreme Court judgment in the Nolan Transport case, I reconvened the group and asked it to further consider the matter.

The group came up with an agreed set of proposals later that year. In summary, it reaffirmed that where negotiating arrangements are in place, the most effective means of resolving differences that arise between employers and employees is voluntary collective bargaining. The report went on to address the problems that arise in disputes where negotiating arrangements are not in place and recommended two distinct procedures to be put in place. The first of these is a voluntary one and is set out in the code of practice on voluntary dispute resolution which was prepared by the Labour Relations Commission and published by the Tánaiste in May this year. The objective of this code is to provide a recognised framework for the processing of disputes in situations where negotiating arrangements are not in place and where collective bargaining fails to take place. It prescribes that management and unions should fully co-operate in seeking to resolve issues in dispute effectively and expeditiously by means of the following steps.

In the first instance, the matters should be referred to the Labour Relations Commission, which will appoint an officer from its advisory service to assess the issues in dispute. The LRC officer will work with the parties in an attempt to help them resolve the issues in dispute. In the event that the issues in dispute are not capable of early resolution by the LRC intervention, an agreed cooling-off period will be put in place. During the cooling-off period, the LRC's advisory service will continue to work with the parties in an attempt to resolve the outstanding issues. The commission may engage expert assistance, including the involvement of ICTU and IBEC, should that prove helpful to the resolution of any differences. If after the cooling-off period all issues have been resolved, the LRC will disengage. Before disengaging, the commission may make proposals to the parties on procedures for the peaceful resolution of any further grievances or disputes. Finally, in the event of issues remaining unresolved after the cooling-off period, the LRC shall make a written report to the Labour Court on the matter. The court shall consider the position of the employer and the union and issue recommendations on outstanding matters.

This voluntary procedure was the preferred approach of the group. It is only in the case of parties not participating in this voluntary approach that a legislated fall-back procedure would come into play. It can be seen from its report that the group envisaged it would operate only in exceptional circumstances.

The Bill will give effect to that special fall-back procedure. It provides for a unilateral referral by an authorised trade union or excepted body to the Labour Court in situations where the following circumstances pertain: it is not the practice of the employer to engage in collective bargaining negotiations and the internal dispute resolution procedures normally used by the parties concerned have failed to resolve the dispute; the employer has failed to observe a provision of the code of practice on voluntary dispute resolution mentioned earlier or has failed to observe such a provision in good faith; neither the trade union nor the employees, as the case may be, have acted in a manner which, in the opinion of the court, has frustrated the employer in observing a provision of the code of practice; and, neither the trade union nor the employees have had recourse to industrial action after the dispute was referred to the commission in accordance with the provisions of the code of practice.

The essential point is that, in order to trigger the special fall-back procedure provided for in this legislation, an employer must have failed to avail of, or failed to follow in good faith, the voluntary procedures as set out in the code of practice. If the employer has behaved in that fashion, a trade union can activate referral to the Labour Court under this new fall-back procedure, a procedure which can culminate in an outcome that is legally enforceable through the Circuit Court.

This Bill sets out the various steps in this fall-back procedure. The court is empowered to investigate the issues in dispute and issue a recommendation in the normal way. If matters remain unresolved, the court may, at the request of either party, review all relevant matters and issue a determination. Ultimately, if matters remain unresolved, the court will issue a binding determination. Where an employer fails to comply with this latter determination, an enforcement order can be sought in the Circuit Court.

I will now outline the various provisions of the Bill in general detail. Section 1 is a standard interpretation section which provides for the definition of certain terms that are mentioned later in the Bill.

Section 2 covers the investigation of disputes by the Labour Court. In subsection (1) it specifies the circumstances under which the court will investigate a dispute. Subsection (2) requires the court to take account of any existing practices in place in the employment concerned for setting terms and conditions of employment and to have regard to the entirety of labour relations practices in the employment concerned.

Section 3 gives power to the court to hold a preliminary hearing to satisfy itself that the requirements of section 2 have been met. Section 4 extends the powers to summon and examine witnesses and require the production of documents to any investigation carried out under the Bill, which are granted to the court under section 21 of the Industrial Relations Act, 1946.

Section 5 empowers the court to issue a recommendation on terms and conditions of employment and on dispute resolution and disciplinary procedures. Consistent with the overall approach to this legislation, it will not be open to the court to include arrangements for collective bargaining in its recommendation.

The Labour Court recommendation issued under section 5 is not legally binding. However, if the recommendation does not result in the dispute being resolved, the court, under the power given to it in section 6, may, at the request of a trade union or excepted body, review all relevant matters and issue a binding determination.

Section 7 requires determinations issued by the court to be in writing, to be served on both parties and to include a statement setting out the reasons for its determination. Section 8 outlines the effect of industrial action. It requires the Labour Court, following a request from an employer or a trade union, to cease its involvement and withdraw any recommendation it has issued, if industrial action has taken place between the time the matter was referred to the Labour Relations Commission and the issue of a determination under section 6.

Section 9 enables the court to review and vacate, affirm or vary a determination where requested by either party, but not earlier than 12 months after the court made it. Section 10 enables a trade union to apply to the Circuit Court for an enforcement order where the binding Labour Court determination under section 6 has not been implemented.

Section 11 allows for an appeal to the High Court on a point of law only. Section 12 is a routine provision enabling the making of regulations. Section 13 outlines the short and collective titles for the Bill and prescribes that the Bill shall come into operation on such day as the Minister may appoint by order.

In summary, this legislation provides a mechanism for processing claims on behalf of employees where an employer has refused to follow the voluntary procedure as outlined in the code of practice on voluntary dispute resolution. This new dispute settling power for the court reflects the consensus in the high level group. It will enable a trade union to progress pay or other conditions on behalf of its members in these cases which meet the criteria set out in section 2.

Most trade union recognition disputes have their origins in concerns about pay and other conditions. This Bill will greatly improve the prospects of resolving these type of disputes. At present, trade unions can refer claims to the Labour Court under section 20(1) of the Industrial Relations Act, 1969. However the court's recommendation is binding only on the trade union and not on the employer. The legislation which I am moving today will ensure finality by providing for the enforcement of Labour Court findings in the Circuit Court, if necessary. In other words, it will ensure there are no blank walls, that there will be a process which aggrieved workers and unions can use to resolve their differences.

Deputies will recall that the Labour Party introduced the Trade Union Recognition Bill in the Dáil in February 1998. At that time, the high level group had been given the task by the previous Government of considering ICTU proposals on the matter in the context of chapter 9 of Partnership 2000. While the Private Members' Bill was a valuable contribution to the debate – which I have always acknowledged – I indicated at the time that my approach was to seek a consensus between IBEC and ICTU before agreeing to legislation.

I am very pleased that we now have agreed proposals for dealing with this sensitive issue. The formula devised by the high level group represents a balanced response. Both unions and employers have opted for this approach, which reflects their preferred option of continuing our voluntarist tradition.

The justification for such procedures as I have outlined in both the code of practice and the Bill was, as I said in the Seanad, put succinctly by Mr. Justice O'Flaherty in his judgment in the Supreme Court in the Nolan Transport case when he said:

The State, representing the rest of us ordinary citizens and taxpayers, has a very keen interest in seeing to the harmonisation of industrial relations. We all stand to lose too much where there is strife and conflict. We should now have advanced sufficiently in our respect for democracy and the rule of law and all its refinements to work out a better way. At this stage of our development this country should be an example to other countries on how to avoid industrial conflict, and when conflict does arise on how to resolve it speedily. That is good for everyone; it will lead to more employment and increased trade.

He went on to state that "employers have an obligation to accord trade unions a measure of respect: representing as they do the rights of the workers."

The procedures we are now putting in place – the voluntary mechanism in the code of practice and the special fall-back procedure in this Bill – offer a method of dealing with the right to bargain in situations where collective bargaining arrangements are not in place and the parties have not engaged in talks.

It is instructive to see the measures proposed in the Bill in the context of our overall approach to industrial relations procedures. The fundamental approach of successive Governments to industrial relations has been one of voluntarism, and this approach has served us well over the years. Traditionally, our laws do not try to impose a solution on parties to an industrial dispute, but rather are designed to help and support the parties in their efforts to resolve their differences. The State has confined its role to underpinning voluntarism through the provision of third party machinery and a floor of statutory rights. I have put this case on many occasions over the past three years, as Minister of State with responsibility for labour affairs, at European Union level, where we try to share best practice.

I am proud that we have an unique position in European terms in regard to social partnership. Such a system enhances the general industrial relations debate at EU level.

The State provides a number of dispute resolution services to assist workers and employers in resolving their differences. The Labour Relations Commission chairs more than 2,000 meetings per year and four fifths of these cases are settled at conciliation. Issues not resolved by the Labour Relations Commission are normally referred for investigation to the Labour Court. Despite the fact that the majority of recommendations issued by the court are non-binding, there is an acceptance rate of more than 80% by parties to disputes. Those involved at Labour Relations Commission level and Labour Court level deserve great credit. We hear only about these organisations in times of conflict. It is important to note that in the majority of cases disputes are resolved. Their work is crucial to the economy and I take this opportunity to acknowledge it.

A consensus exists among employers, trade unions and Government that voluntary collective bargaining should be the primary means of regulating industrial relations. Such collective agreements cover all issues arising in the employment relationship and – consistent with the notion of voluntarism – are not legally binding. They have a moral force only but, in practice, are all the more successful because of their voluntary nature. I might add, parenthetically, that the five national agreements since 1987 have promoted growth, competitiveness and social inclusion which surpassed even our wildest dreams. At the core of this collective bargaining has been the willingness on all sides, employers, workers, Government and others to take into account and appreciate the views and aspirations of others, thus facilitating a consensus approach to macro-economic issues based on partnership and mutual gains principles.

All sections of society have benefited from the increased competitiveness of our economy. This consensus approach has involved a continuing commitment by employees to improvements in quality and efficiency and an acceptance by employers of employees as stakeholders with rights and interests to be considered in the context of decisions affecting the enterprise in which they work. The strains that are currently in evidence have much to do with managing our economic growth and our growing expectations. We cannot and must not fritter away the gains we have made by taking our eye off the ball of competitiveness and fairness. To do so would be short-sighted and no way to build a solid platform for further economic prosperity.

Legislation can play an important role in underpinning the voluntarist approach to industrial relations. This Bill, which has the support of both sides in the employment relationship, will have a significant impact on reducing conflict between employers and workers in situations where collective bargaining is absent.

The Bill passed all stages in the Upper House following a lively and constructive debate. I agreed to reflect on some issues raised and I will come back to these on Committee Stage. I look forward to hearing what Members have to say. Obviously I am open to considering some amendments.

I commend the Bill to the House.

Mr. Naughten

I welcome the general thrust of the legislation which is based on the agreement between IBEC and ICTU, ably assisted by others and the discussions which preceded the introduction of the Bill. The Bill extends the existing legislation to give the Labour Court new powers to resolve disputes in circumstances where the parties have not engaged in talks. I welcome the measures contained therein where negotiating arrangements are not in place and where collective bargaining fails to take place.

The basis of the legislation is in the establishment of the high level group under Partnership 2000, a programme with which my party was much involved. In Partnership 2000, ICTU and IBEC recognised the need to modernise our industrial relations procedures and institutions. One of the initiatives agreed was the establishment of this high level group to consider detailed proposals submitted by ICTU on the recognition of trade unions and the right to bargain. This partnership and the partnership agreements have served us well in the past. This legislation is viewed as the final mechanism in dispute resolution where talks have failed to resolve the particular issue, most likely in relation to pay or conditions. Even though the aim of the Bill is to resolve some of the more difficult disputes, it cannot resolve some of the current problems between the social partners. In a week when Dublin Airport is closed by strike action for the first time in 20 years in Aer Lingus, when the ASTI has voted for widespread industrial action, when the media has numerous stories of strikes and threatened strikes and inflation is at 6.2% for the second month in a row this is a sobering thought.

Workers will not stand idly by and allow their living standards to be eroded. The Government must act as up to now it has pretended to take action in the hope that falling oil prices and the strengthening euro would take the sting out of inflation. Unfortunately the problems in the Middle East will increase rather than reduce the price of oil. The external value of the euro continues to languish. The inflation rate shows that the Government's limited action is having no obvious effect on tackling this problem. Inflation is now the key obstacle to stable industrial relations and the future of the partnership process.

The talks at social partnership level are attempting to design a package which will restore those living standards which have been eroded by inflation. Those discussions between the social partners are not dealing with the problems of inflation but rather with the consequences of inflation. Inflation makes people poorer. This year inflation has cancelled the 5.5% increase in wages under the Programme for Prosperity and Fairness and the 5% average increase in social welfare payments. Consequently the living standards of those on fixed incomes have been seriously eroded. The current review is in part a response to the demand by workers and social welfare recipients to regain the ground lost through inflation.

On Tuesday last, the Minister for Finance provided little solace when he said that inflation could go higher. The argument between the social partners is not whether inflation should be tackled but rather how it should be done. A package of measures containing pay elements, tax concessions and better social services must be designed to compensate for the falling living standards. We all agree with this. Whatever is done must be done in such a way that it does not fuel inflation. This will not be an easy task but it is preferable to the widespread unrest and a reduction in competitiveness which would result from an extended bout of wages chasing prices.

The key to resolving inflation and the knock-on industrial unrest is resolving the supply bottlenecks. Fine Gael believes the Government should establish a supply task force comprising Government agencies with a mandate to increase the supply of domestically produced products and services that impact on the CPI. It will be noted from this week's inflation figures that the service industry is still running at an inflation rate of 7%, which is above the average 6.2% throughout the CPI. This task force would identify changes in legislation and public administration and, as a matter of urgency, would examine areas where the rates of price increase exceed the norm, giving priority to factors determined within Ireland and under our control, such as housing. Another issue would be the resourcing of the Competition Authority and ensuring the staff are put in place to combat anti-competitive practices. I hope the necessary resources can be put in place in the Competition Authority and that it will have its proper complement of staff. Given that its staffing levels are one-third down I hope some progress can be made in that area. Such a supply side task force would produce concrete proposals for legal and administrative changes to increase the supply of goods and services on an emergency basis. The legal changes needed could be prioritised and fast-tracked through this and the other House. This is fundamental to the continuation of partnership which we have had for over a decade and the development of a type of co-operative legislation which we have before us today. It is important to be aware of that. It is due to the partnership process and the co-operative framework that has existed over recent years that this legislation is before the House. We do not want to see that being threatened in the future. The kernel issue now is inflation and it must be resolved.

The Bill is the result of the March 1999 report of the high level group. The genesis of its recommendations was the issue of trade union recognition in the Ryanair and Nolan Transport disputes. The group had the advantage of the Supreme Court judgment in the Nolan Transport case as well as the report of the inquiry into the Ryanair dispute at Dublin Airport. Mr. Justice Hugh O'Flaherty in his Supreme Court judgment in the Nolan Transport v. SIPTU case accepted that trade union recognition disputes fall within the definition of a trade dispute as provided for in industrial relations legislation. He said that employers have an obligation to accord trade unions a measure of respect as representatives on behalf of the rights of workers.

That was an important judgment and Mr. Hugh O'Flaherty should be given recognition for it. Sadly, over the last few months there has been much criticism in the House of Mr. O'Flaherty on a different matter. It is appropriate, however, that we take note of the fundamentally important judgment he made. He should be commended for it.

The high level group pointed out that the most effective means of resolving differences which arise between employers and trade unions representing employees was by voluntary collective bargaining. When problems arise in cases of dispute where negotiating arrangements are not in place two distinct procedures, as outlined by the Minister, should be brought into play. The first is the voluntary approach which is incorporated into the practice of voluntary dispute resolution by the LRC. Everybody would agree that this is by far the best avenue for resolving such disputes. The Bill outlines a second avenue which should be used only as a last resort and will, hopefully, not be invoked with great frequency.

It is important to note the Minister's point that the LRC chairs over 2,000 meetings per annum, four fifths of which result in cases being resolved by conciliation. The unresolved issues go to the Labour Court where 80% of them are resolved through non-binding judgments. The remaining approximately 4% of disputes cause the difficulty which this legislation and the voluntary code of practice address. Hopefully, there will be a resolution of some of these cases through the voluntary code of practice. The threat of binding recommendations, provided for in this legislation, should also ensure a reduction in the number of those cases. It is hoped that many of these disputes can be resolved without recourse to this legislation. That would be, by far, the best course to take.

The Bill outlines the procedures to be followed should an employer refuse to participate in the voluntary code of practice. The Labour Court will have power to make binding recommendations. It can investigate the matter and make recommendations on foot of its investigations. If there is no agreement on such recommendations, the Labour Court can make a determination which is binding for 12 months and, as the Minister pointed out, the matter can go before the Circuit Court. This is the cornerstone of the Bill which, it is hoped, will address the issues raised by the Ryanair and Nolan Transport disputes.

The Bill deals with situations where there is no domestic mechanism to deal with disputes and where the employer and trade union involved have not put in place a structure to deal with agreements and negotiations. We cannot stand by a situation where a company can be brought to its knees because one side refuses to put in place structures to deal with difficulties. If an employer, for example, refuses to put in place a structure to bring about a domestic remedy, either party or the court can intervene to resolve that problem through the mechanisms in the Bill.

It is important to note that there is a certain onus on the trade unions as well. Sadly, difficulties among unions have become a more common problem in recent disputes, for example, in the threatened ESB dispute, the Aer Lingus dispute and the Irish Rail dispute. That gives rise to questions in relation to social partnership and unions recognising other unions and their negotiating rights which must be resolved. ICTU has a responsibility and role to play in that regard. It is fundamentally important that issues such as this do not prolong industrial disputes. The Minister has his work cut out in that regard.

Rivalry between unions and employers can be tackled and resolved with this legislation but this other problem has now raised its head. It is not covered by the Bill but it is of fundamental importance to successful industrial relations. The problem must be nipped in the bud and not allowed to generate more serious disputes as time passes. In the past eight months we have seen it cause two disputes and one threatened dispute. These questions must be resolved and mechanisms must be put in place through ICTU to resolve them and ensure the efficient running of our labour relations mechanisms.

The focus of disputes and the sector where the greatest problems have arisen is the indigenous private sector. This sector is key to the success of these new negotiating mechanisms and I hope consultation took place with the sector.

An issue which has been highlighted in the media over the last 24 hours was raised by me with the Minister last Thursday. The issue is the abuse of the rights of foreign workers. They are not given the same entitlements under employment legislation as other workers. I have been informed of a situation where Irish employees in a certain company are allowed to join a union but foreign workers are not. The abuse of the Employment Agency Act highlights one problem with regard to immigrants but, sadly, it is only the tip of the iceberg. I believe many more abuses of employment legislation dealing with minimum wages, working time directives and so forth are occurring. These workers are being abused. They are not aware of their rights because the system is not properly policed due to inadequate resources. The workers are also threatened with the loss of their jobs if they do complain.

I disagree with the Tánaiste's argument this morning that this has nothing to do with the work permit legislation. It is fundamental to that legislation. Unless it is implemented when the immigrants arrive in this country, it will be extremely difficult to enforce other legislation. Some type of tracking mechanism must be put in place. In addition, under the work permit legislation an employee must stay with an employer for 12 months. That, in itself, is leading to some of the abuses of employment legislation because if an employee loses his or her job, he or she might have to return to his or her native country. These people cannot afford that. If they have had to pay, as has been alleged, up to three years' salary to come to Ireland, they cannot afford to lose their jobs and be sent home. This will result in Ireland having a bad reputation in the future in relation to the treatment of foreign nationals. It will also mitigate against the recruitment of foreign nationals to the detriment of the economy, given that we need the services of these people.

I am pointing out this problem under this legislation because it is causing huge friction within the workplace. There are now two sets of rules for employees. The employment legislation is enforced in relation to Irish and European employees who have union representation and can lobby management. Foreign workers do not have union representation and those who do are often threatened with the loss of their jobs. These employees are doing double and treble shifts, which reduces the amount of work available for Irish workers. Some employers are fuelling racial tensions within the workplace by stating that one foreign national is three times as good as an Irish worker. If they are being abused and being made to do the work of three people, naturally they are three times as good. This is an abuse of the legislation and is causing friction within the workplace. Staff are now being pushed aside and replaced by foreign nationals. As a result, there have been a number of skirmishes and minor disputes throughout the country. Unless this problem is nipped in the bud, there could be serious industrial relations and racial problems in the workplace, the knock-on effect of which would be that people would not come to this country.

A working group should be set up to look at the enforcement of the current employment and industrial relations legislation, including this Bill, to see if there are loopholes employers are using to keep foreign employees from coming under the terms of the legislation. Even though everyone is supposed to be treated equally, because these employees are not aware of their rights, they cannot have them enforced or complain about them. If they complain, they may lose their jobs and have to leave the country. This is a fundamental issue which needs to be resolved if we are to ensure these employees are protected, that the jobs of Irish employees are protected and that we do not have industrial relations disputes arising out of this friction in the workplace. That is of no benefit to any individual, company or the reputation of this country abroad.

This is progressive legislation which is not to be found on the Statute Books of many countries in the European Union, including the United Kingdom. To the best of my knowledge, neither are such structures in place in the United States. In that context, the legislation is a positive development. It shows the partnership that exists in this country and how far we have come in relation to the industrial relations mechanism. It highlights our maturity in being able to do business without conflict or confrontation. This goes back to the progression of partnership agreements over the years. Since I came into the workplace, there have not been very many industrial disputes. I probably come from a generation to whom industrial disputes are rather unique. However, this was not the case 20 or 30 years ago when there were serious industrial relations problems. This was the case even up to ten or 12 years ago. It is great that there has been such a turn around and that this legislation is at the cutting edge in this regard within the European Union.

While the Minister of State's party is questioning participation and enlargement within the European Union, it is of fundamental importance that we remain part of the EU and ensure that new legislation is introduced which will lay the common ground throughout the EU in relation to employment and trade. Where there are 15 different pieces of legislation throughout the European Union, whether employment legislation, industrial relations legislation or whatever, this is a disincentive to the development of Irish industry in Europe and production processes in this country. The Minister of State has a role to play in ensuring this type of legislation is taken on board by other member states and that all employment legislation is streamlined throughout the European Union. I hope he will take a more progressive and positive attitude towards participation within the EU than some of his more senior ministerial colleagues. As a good west of Ireland man, I am sure he will take this attitude because the European Union has been good to the west of Ireland. It is important that we question aspects of EU legislation but it is also important that there is streamlining of regulations and legislation throughout the EU, rather than the critical approach taken by some Ministers in relation to this issue, which is a key element to the success of the common market.

The key element to the success of this Bill will be a partnership structure and a commitment from both sides to review its implementation. This will help to resolve many anomalies which may arise. It is a positive development that there is agreement to have a continuous review of the legislation. Perhaps we should consider having more ongoing reviews of legislation. The situation which was highlighted in this House last Thursday and in the past couple of days may not have arisen if there had been ongoing reviews of the legislation which is 30 years old. I hope it will not be 30 years before this legislation is reviewed. I hope also it will not have to be implemented.

This is a positive development. I hope the Minister of State will address some of the points I have raised, which may not relate specifically to the Bill. However, they are important issues which come within the Minister of State's brief and which need to be resolved if we are to have a stable industrial relations environment in the future.

Mr. Rabbitte

I mean the Minister of State or the House no disrespect when I say I cannot work up any great enthusiasm about the legislation. To be honest, it is neither here nor there. I am a member of a trade union. I worked for what was then the ITGWU, now SIPTU, and I am still a member of that union. I do not know if that constitutes a vested interest. The Bill is not of any great moment. It has an extremely limited, narrow focus and is unlikely to leave any perceptible mark on the industrial relations landscape except perhaps in extreme cases which might only be worsened by this legislation.

Before I discuss the Bill, I want to take up Deputy Naughten's remark on social partnership. I am somewhat surprised given what is happening currently that the Minister of State made almost no comment in his contribution about social partnership and the strains and stresses it is enduring. He stated: "The strains that are currently in evidence have much to do with managing our economic growth and our growing expectations". I hope that is not the full thrust of the Government's assessment of what is wrong because that is too glib and facile. It is more serious than that and it is not just about managing our success, economic growth and increased expectations.

The big winner as a result of economic growth over the past seven years has been employment creation. The significant gain is that almost 600,000 more people are at work than in 1992. Governments and others ought not to draw the conclusion that because of that fantastic expansion in employment, individual workers are proportionately better off; they manifestly are not. In some cases workers have done quite well and the Minister of State, at least in private discussion, will frankly admit that others did much better than the terms of successive national agreements, including the present one. That to a large extent reflects the tightening of the labour market and the fact that employers must be prepared to pay to retain skilled, semi-skilled and key people. I suspect that is a significant factor in wage increases.

However, unfortunately all sectors in the economy do not perform evenly and people are caught in less profitable industries and menial employment on low pay. Certain elements of service industries do not pay well. How many of the Minister of State's esteemed estimable senior civil servants knew about the situation at Aer Lingus? Did he know it was that bad? I am ashamed to admit I did not know that people in what used to be prestigious employment are being paid the buttons we learned about this week. It is quite an embarrassment.

To some extent it demonstrates the folly that happens frequently in industrial relations of patching up a dispute to get over the particular hump at the time. This legislation patches up something else and I am not sure that the end product advances the cause of human harmony a great deal. The management at Aer Lingus has admitted that it has a fundamental problem of low pay. That does not relate to managing our economic success or people's expectations. I am absolutely fascinated.

The average Member of this House is not paid commensurate with the job he must do but we are well paid by comparison to the workers in Aer Lingus to whom I listened on "Morning Ireland" earlier this week. One cannot ascribe to them great expectations. It is a perennial puzzle for me to understand how they make ends meet because they rent houses, have mortgages and try to run a car. Social partnership is under greater stress than the Minister of State's casual reference implies.

The second possible explanation for that reference is that he knows well what I am saying is right and he does not want to refer to it because it will open a hornet's nest. However, this House is the place to discuss the issue.

Mr. T. Kitt

I would love to because I agree with many of the Deputy's comments but I focused on the legislation in my contribution. It is not the most exciting Bill as it is pretty mechanical. I agree the Deputy is raising real issues but we should discuss them on another occasion.

Mr. Rabbitte

I take the Minister of State's point. However, the House is the place to discuss these issues. One of the interesting aspects of the diminution of the stature of this Parliament is that between the impact of the European Union on the one hand and social partnership on the other the role of this House has been diminished as a result.

If the Government argues that social partnership is the cornerstone of our economic success it must be nurtured, worked at, guided, and invested in if it is to survive this rickety period. The House is the place to do that because social partnership is not just about the corporate state meeting at the top level and saying that senior personnel in the trade union movement, the employer's organisations and in the Minister's Department are all agreed that in an ideal world the formula should be whatever. That need not necessarily be the perception on the ground and we have made little enough progress translating social partnership from that level into the workplace. We need to return to that.

Inflation is a big factor in all of this. If one is not on low pay similar to some Aer Lingus employees, one finds that in the present environment the first phase of the PPF has been eliminated as a result of inflation. I hope the eminent tax reductions will make a contribution to the overall value of the social wage but nonetheless the first increment has been obliterated by inflation and that is a major issue.

With regard to the legislation, a Leas-Cheann Comhairle, you will recall a famous member of your own party—

An Leas-Cheann Comhairle

As Leas-Cheann Comhairle, I do not have a party.

Mr. Rabbitte

I absolutely recognise that even the suggestion, a Leas-Cheann Comhairle, is outrageous, but when you had a party you had a famous leader who once said in the House when asked a question about a conference of major religious superiors that he had an inherent suspicion of anything with the words "major" and "superior" in the title.

Mr. Treacy

What does the Deputy think?

Mr. Rabbitte

I did not agree with him on everything but I did on that. Anything which involves a high level group brings out the same reaction in me. The Minister of State came into the House and because the high level group agreed a number of principles, the suggestion is how could anyone in Dáil Éireann have the audacity to raise any questions about something agreed by a high level group. However, I question it because the point at which the debate started was the need to deal with the problem of trade union recognition. Whatever the Bill before the House today contains, it does not deal with trade union recognition.

I was amused by a bloomer in the Minister of State's script that got past the vigilant Civil Service. The sentence taken straight from the Seanad debate on the word processor states "Senators will recall that the Labour Party introduced the trade union recognition Bill". I read the debate involving the eminent Members of the more reflective Chamber and it did not rise to its usual great heights, with the exception of the contribution of my colleague, Senator O'Toole, who was immensely enthusiastic. However, he was wearing an even more partisan hat than me.

The paragraph imported directly on the word processor from the Seanad debate talked about the Labour Party Bill on trade union recognition, and this was the point. It was a Bill about trade union recognition; that was the purpose of our legislation. My colleague, Deputy Broughan, will undoubtedly point out the significant meaningful differences between the Bill the Labour Party introduced and the watered down, pale imitation, which is full of loopholes and escape hatches, that is now before the House. This is the first point I wish to make. This is not a trade union recognition Bill because it does not provide for recognition of trade unions or free collective bargaining.

It may be the official view that this is not a great problem in any event in the sense that the law protects the worker who wishes to join a trade union and if a worker does not wish to join a trade union, there is no problem. Obviously, trade unions have a vested interest in this matter and if a case similar to that involving Ryanair happens, they kick up a fuss and we will be seen to respond to it. However, even if the penetration of trade unions diminishes significantly, it is not a great issue for society.

I hold a different view and I confessed my partisan interest earlier. It is interesting to consider the history of trade union penetration in Ireland in recent years. It has seriously diminished and trade unions probably do not do their cause any good by seeming to deny that this is the case because numbers have more or less remained static. However, in density terms, the percentage organisation has seriously declined. Around 1980 the percentage trade union penetration in the country was approximately 62%. It is now marginally below 40%. The view that numbers in unions have apparently remained static does not accord with the fact, given the expansion of the work force

This is a matter of concern and it is not desirable to have a trade union movement that predominantly comprises the public sector or certain traditional or low paid categories of workers. This is why there is a need for legislation dealing with trade union recognition – if we are to take the legislative route – but whatever is before the House, it is not a trade union recognition Bill. This legislation is designed to facilitate the containment of disputes that might arise in an employment because of dissatisfaction with pay and conditions.

Trade union disputes can happen for reasons that have nothing to do with pay and conditions, but that is not provided for in the Bill. The legislation is designed to contain industrial conflict. It is not designed to facilitate the recognition of trade unions. The Minister of State quoted Mr. Justice Hugh O'Flaherty in the Nolan case, but there is another quote from Mr. Justice O'Flaherty in that case which is pertinent to this aspect. He said:

Employers have an obligation to accord trade unions a measure of respect, representing as they do the rights of the workers. An unfortunate aspect of the present case is that the employers appear to have approached it on the basis that either all the workers joined the trade union or none of them joined, and that decision was to be made by the majority of the workers.

This situation can and does arise and I am not sure that this Bill will help it appreciably.

I agree with the Minister of State's comments in respect of the voluntarist nature of our industrial relations machinery. Unless there is a good reason, I am not in favour of further and ongoing legislative intervention. If there is legislative intervention, it must be for a precise and meaningful purpose and not because it is a patch up job to facilitate demands from one or other side of the social interests. This is what is involved here. Whereas trade unions are making an effort to address the new type of worker and the new type of company being attracted to this economy in terms of offering a different range of services, a different type of membership and a different nature of service back-up, they are naturally concerned, as I am, about the diminishing rate of trade union recruitment.

They have been frustrated, as they were outrageously, in the case of Ryanair. In that dispute, it was agreed to build on the work of the high level group and the opposite of trouble shooters were sent in to resolve it. There was no appreciable effect and the Bill will have the same outcome from the trade union point of view. There will not be an appreciable effect. The provisions of the legislation will not come into effect unless the employer has been found in good faith to have failed to comply with the terms of the voluntary code. If that happens, that are four very serious requirements in terms of what must be complied with by the trade union side in particular before the gravamen of the Bill might be invoked.

Section 2(1)(d) states:

the trade union or the excepted body or the employees, as the case may be, have not had recourse to industrial action after the dispute in question was referred to the Commission in accordance with the provisions of such code of practice.

In keeping with the thrust of the Bill, in all events industrial action must be avoided. There is a specific requirement here to ensure that there was no recourse to industrial action after the dispute was referred to the commission. There is nothing in the section or the Bill that acknowledges that some employers would be prepared, as Mr. O'Leary of Ryanair would be, to provoke a dispute that has apparently nothing to do with the original issues that gave rise to the dispute. That situation is not provided for in the Bill. The legislation is framed in the mentality of normal, sensible employers doing business with normal, reasonable trade unions. There is, however, nothing sensible, reasonable or rational about trade union recognition disputes. There is a great deal of bad blood and determination on the part of the employer that he or she will not permit trade union organisations or deal with a trade union which in many cases may even represent a majority of workers. Nowadays, sophisticated avoidance techniques are built in to ensure that trade unions are kept out.

A particularly bloody-minded dispute is usually the only one of this genre that comes into the public domain. The legislation is framed to assume the normal, rational, sensible impulses of the good employer, but that is not the kind of situation we are dealing with. Section 5(2) states that "a recommendation under subsection (1) shall not provide for arrangements for collective bargaining”. It is crystal clear, but from the point of view of the trade union movement I am not sure why they want this Bill. The Minister is providing an avenue of resolution in respect of pay and conditions for an aggrieved employee or group of employees. The Bill expressly denies trade union recognition and collective bargaining, which are the issues the Labour Party set out to address. In many ways it is more likely that the legislation will lead to litigation.

We will go through the detail of the Bill on Committee Stage when, I wish to advise the Minister, we will be tabling a number of amendments. As one goes through the Bill one can see the loopholes as well as the hurdles that must be jumped by a trade union before it has the ultimate access to the Labour Court for a binding recommendation. These loopholes would invite a bloody-minded employer to litigate if he fails at that stage and, thus, have his way in the end.

It would almost have been better to leave the situation as it was. While we have already discussed the fact that the Constitution does not oblige an employer to recognise or negotiate with a trade union, recognition disputes have been recognised and facilitated by the courts. Most clever trade unions would always build such a dispute on another issue and it would not transparently be described as a recognition dispute. They would have the dispute on the issue of pay or conditions. Nonetheless, the courts have recognised and facilitated that process in some fairly high profile cases. In that situation, a union with a substantial number of employees in membership would rarely be denied success. Therefore, to some extent, we are legislating for the exception and I am not so sure that is to the advantage of the trade union movement.

I will refer to certain cases in more detail on Committee Stage. I well remember cases such as Abbott and Whelan and the ITGWU, and I quote:

The suggestion that there is a constitutional right to be represented by a union in the conduct of negotiations with employers, in my opinion, could not be sustained. There is no duty placed on an employer to negotiate with any particular citizen or body of citizens.

That line ran through a number of judgments and it is well accepted that there is no such obligation. However, it has also been established that there is no difficulty in terms of a recognition dispute. The courts have held that disputes over recognition are valid trade disputes.

The Industrial Relations Act, 1990, distinguishes disputes over recognition immunity from "action in relation to any tortuous act committed by or on behalf of the trade union in contemplation of furtherance of a trade dispute provided they comply with certain stated statutory requirements". So even the 1990 Act which tightened up this matter did not outlaw that situation.

We must tease out a number of detailed questions on Committee Stage before we can validate whether this legislation has merit. There are many practical questions to which I do not know the answers at this stage. If a relatively small number of workers joins a union in a substantial employment, could we ever get to the situation where the binding determination would issue? If 30 employees in a company employing 600 joined a trade union, would a court be prepared to issue a legally binding determination in such circumstances? It seems it would have to tread very warily indeed and, to some extent, that defeats the purpose. We built some figures and proportions into our Bill, which seem desirable and sensible. Employers as well as trade unions can take industrial action. What will happen if during the process an employer suspends or locks out an employee or employees suspected of having joined a union?

The argument advanced for this Bill is that it is the outcome of discussions between both sides of industry and that as a result of that it is selfevidently a good thing. I am not sure that in practice it will turn out that way. The voluntarist character of our industrial relations machinery has served us well. The least legislative intervention is desirable unless it has a manifest purpose. The purpose here is vague and has shifted from where we started. It may well invite litigation in the kind of bloody-minded situation I have mentioned.

Notice taken that 20 Members were not present; House counted and 20 Members being present,

Mr. Collins

The Bill strengthens our industrial relations legislation, extends existing legislation to give the Labour Court new powers to settle disputes in circumstances where parties have not engaged in talks and sets up various mechanisms to deal with such disputes. However, before dealing in detail with the specific proposals in the Bill, I wish to make some broader comments on the need to strengthen and modernise industrial relations within the social partnership model.

Great economic progress has been made since 1987. Recent statistics have shown that unemployment has fallen to 4.3%. Only 74,000 people were unemployed in the second quarter of this year and 27,000 of those were long-term unemployed. No one would ever have believed that we would see such low figures. I am convinced that we are now on target and it is Government policy to eliminate long-term unemployment in the lifetime of the Government. However, the question should be asked why we have been able to make such strong economic progress over a period of 13 years. In 1987 Government borrowing was running at over 11%, unemployment was 20% and there was zero growth in the economy. Emigration was a daily fact of life for the vast majority of families on this island. We now have one of the strongest economies in Europe and have reversed the historic tide of emigration. Inward investment into Ireland is now stronger than ever.

The key reason we have been able to make such strong economic progress over the past 13 years is the existence of social partnership agreements. Many other European Governments look at Ireland with envy when they see such strong social partnership agreements in place covering a wide range of social and economic issues, including pay, for periods of up to three years. In other EU countries, bilateral negotiations between individual trade unions and the Government are normal practice. However, they do not lead to a lowering of industrial unrest but heighten the prospect of it.

Since the first social partnership agreement in 1987, we have worked very hard together to define social partnership and to deal with new priorities and challenges. The current Programme for Prosperity and Fairness is no different in that respect. Over the past 13 years, partnership agreements have provided us with the framework for moving together to achieve real progress and have helped us break out of damaging short-term reactions to complex issues.

The scope of the Programme for Prosperity and Fairness reflects how far we have come and it is both innovative and ambitious. The awareness of past achievements should give us the energy to address outstanding problems and reach the new targets which are at the heart of the Programme for Prosperity and Fairness. We need to maintain our focus on those ambitious goals in areas such as child care, poverty, transport, life-long learning and competitiveness.

As the Taoiseach stated in his address to the social partners during the summer, each social partnership agreement since 1987 has challenged us in different ways. With each of them we found ourselves tackling new imperatives and priorities. That situation has not changed and no doubt it never will. In implementing the agreed frameworks for prosperity, social inclusion and equality and the successful adaptation to continuing change, we need to remember the lessons learned from the past partnership experience. We are a small open economy in an increasing global market. Our behaviour as economic and social actors affects others just as the interplay of taxation, spending, investment, consumption, wages, productivity and employment go to shape the reality of life in Ireland. Consistency and co-operation will, therefore, always produce more than conflict and confusion.

It is this latter point I wish to address. I am saddened that industrial unrest is increasing in Ireland. I hope that, in the discussions between the Government, trade unions and employer groups, a situation can be reached whereby industrial unrest can be lowered soon. I am confident the Programme for Prosperity and Fairness lays down the key parameters within which industrial unrest can be lowered.

The Bill represents a further step in modernising our industrial relations within the social partnership model. The legislation has emerged from recommendations of a high level group comprising the Irish Congress of Trade Unions and the Irish Business and Employers Confederation. This high level group was established under Partnership 2000 to consider the detailed proposals submitted by ICTU on the recognition of unions, the right to bargain and the IBEC position on the impact of these proposals. This was in the context of the partnership commitment to modernise our industrial relations procedures and institutions. The high level group agreed that where negotiating arrangements are in place, the most effective means of resolving differences which arise between employers and trade unions representing employees is by voluntary collective bargaining.

This Bill will ensure that a voluntary procedure can be put in place whereby parties can avail of the advisory service of the Labour Relations Commission to assist in the resolution of disputes over pay and conditions. When negotiating agreements are not in place, and where collective bargaining fails to take place, the following process can be activated. In the first instance, the matter is referred to the Labour Relations Commission which will appoint an officer from its advisory service to assess the issue in dispute. The officer will then work with the parties in an attempt to resolve the issues. In the event that the issues are not capable of an early resolution by this intervention, an agreed cooling off period shall be put in place. During this cooling off period, the Labour Relations Commission advisory service will continue to work with the parties in an attempt to resolve any outstanding issues. The commission may engage expert assistance including the involvement of ICTU and IBEC, should that prove helpful in the resolution of any differences.

In the event of issues remaining unresolved, the Labour Relations Commission shall make a written report to the Labour Court on the matter. The Labour Court shall consider the position of the employer groups and the trade unions and shall issue recommendations on any outstanding matters.

A special fallback procedure is provided for whereby the Labour Court can investigate an issue in dispute between a trade union and an employer where the court is satisfied that an employer has failed to follow the voluntary procedure, where the appropriate internal procedures and mechanisms have failed to resolve the issue, and where there is no recourse to industrial action during the process. The Labour Court shall conduct an investigation into the matter in dispute taking into account the integrity and totality of the labour relations practices operated in the company and shall issue a recommendation.

I support the key provisions in this Bill which is innovative and which will modernise our industrial relations legislation. The Bill will help minimise industrial unrest and focuses on the need for voluntary agreement for dispute resolution which is sensible and correct. I earlier recalled the Taoiseach's comments when he said consistency and co-operation will always produce more than conflict and confusion. The Taoiseach is right and proper in his general analysis as to how to address particular social and economic problems. This can also be transcended into the matter of dispute settling in a labour relations context.

Our labour relations machinery has worked well for many years. However, legislation governing the operation of the Labour Relations Commission and the Labour Court needs to be updated from time to time and the Bill we are discussing updates the present industrial relations legislation.

Mr. Perry

I am pleased to speak on this important legislation. Industrial relations is important in the year of the millennium. We have a booming economy and there is a perception that people can demand any level of wage increase. This Bill will give the Labour Court new powers to settle disputes in cases where an employer has failed to follow agreed voluntary procedures, where negotiating procedures and collective bargaining are not taking place, and where there has been no recourse to industrial action by the trade union or the employees. However, the Bill is very confined.

The services sector will be the largest contributor to growth in employment up to 2010. The retail sector is the largest segment of this sector accounting for 11% of employment in the economy. Up to 50,000 new jobs have been created in the services sector in the past two years which indicates the role this sector is playing. There is little recourse to the Labour Court in this significant sector of employment. However, the PPF takes little account of this sector and the sector was not represented in the forum which drafted the agreement. It was disappointing that such a significant segment of the economy played no major role in that process.

The services sector, particularly the retail sector – hotels and restaurants – has created significant wealth. Dealing with customers and quality of service have given Ireland a competitive image. I welcome the introduction of the minimum wage but employers are paying well beyond that figure. I was amazed to discover that cabin crew in Aer Lingus, which is a high risk job, receive wages which are only slightly above the minimum wage. People had a different perception of the wages earned by such workers.

The education system frowns on business. Some parents feel their children are above working in the retail sector, such as in hotels, supermarkets or other niche services which contribute so much to the economy. The education system should seriously examine the role of business in the economy and the issue of dealing with customers. The growth of e-commerce is also important. We must never lose sight of the customer and we must build up and promote the services sector, cross-Border trade and such areas.

Child care and lifelong learning are also important elements of industrial relations. The cost of child care reflects on industrial relations within a company. Industrial relations is about communicating with employees whether in large or small companies. Major recent disputes have all involved large companies. We need large companies but small companies employing ten to 15 people have played an important role and have been successful. Disputes in such companies rarely reach the national press as they are resolved within the company and without recourse to adjudication or the additional powers being given to the Labour Court. People do not have to go down that road.

We must value the important role played by small companies which work 40-hour weekends to maintain their services. Retailers, manufacturers, suppliers, distributors and consumers influence the make-up of the big retail chains. It is important that there are good retailers, manufacturers and suppliers as they are all critical to the supply chain, and the area of distribution and logistics has changed considerably. The consumers are most important. These days consumers working for the big industrialists are aware of the bigger picture and expect more.

The Minister must be careful about making statements that the economy is booming because these accelerate people's demands for wage increases. It is important that there is a minimum wage but it is also important to make clear, as I did, that workers do not receive the minimum wage because they must pay tax. The minimum wage for a 40 hour week is £176 but the employee might receive only £152. The perception given was that the worker would receive the minimum wage after tax. When the minimum wage was introduced it should have been clear that it related to gross earnings and there is a huge difference between gross and net earnings. That misunderstanding put huge pressure on employers paying the minimum wage of £4.40 per hour and it is being topped up also. In certain cases, that created huge unrest among workers in small companies. My employees felt entitled to receive the minimum wage of £176. The use of the word "minimum" should have been looked at.

The purpose of the Bill is to give powers to the Labour Court to adjudicate in industrial disputes where companies refuse to follow the normal voluntary procedures or fail to deal in good faith with trades union or staff representatives. Its provisions are in line with the deliberations of the Government's high-level group on trades union recognition but, as Deputy Rabbitte stated, the Bill does not deal with trades union recognition.

I am glad the Bill has been welcomed by the Irish Business and Employers' Confederation. It is important that there is trades union recognition in certain companies but it is not needed in every company. It depends on the structure of the company. Mr. Finbarr Flood, who is chairman of the Labour Court, stated that he was happy to take on the extra responsibilities contained in this legislation. He said the new role of the court has been clearly defined and he is confident that it can carry out the new tasks.

In the past year there have been huge disputes such as the SIPTU baggage handlers dispute at Ryanair in 1998, when Dublin airport closed and the dispute this week. This should not happen in this day and age when there are all these facilities.

People say they were unaware of the wages at Aer Lingus. All of these people were paid extraordinarily high salaries but in any company it is all about good PR. It is no good having good PR at the top level in a company. It is important that everyone is treated equally. For instance, the customer who comes in the door of your establishment and spends £20 should be treated equally and entitled to the same facilities. The problem here is that unfortunately people were not given the information which should be made available to every employee. They should be aware of their wage scale and the possibility of getting increases.

There are difficulties because different trades unions are involved such as MANDATE and SIPTU which are growing their business to an extent by exploiting the market and using the staff as scapegoats. It is regrettable. If there is competition for membership among the trades union, it should not be fought out at the expense of the customer. People who had planned to fly out of Dublin Airport on Tuesday had their flights cancelled and that is bad for business. It gives the wrong signal.

Everybody is concerned at the rate of unofficial disputes. With a booming economy in which inflation has certainly taken hold again, there is a responsibility on all of us, as elected Members of this House, but the acceleration in inflation has been caused in many cases by people being greedy and stating that they want more. People on high salaries feel they are entitled to more. They should decide that wage restraint is important, but we must ensure that people on low incomes get an increase. People on high salaries should not look for massive increases and additional holidays. All of these increases should be capped.

The Tánaiste and Minister for Enterprise, Trade and Employment was critical of employers for failing to spend more on training considering employees are their most valuable resource. I realise that, like me, the Minister of State, Deputy Treacy, empathises with businesses. I am glad to hear that she is critical, but she should be critical not of employers but of her Department.

An employer's greatest asset is his employees. We all hear of bank loans invested in machinery, new vans and equipment but the single biggest investment an employer makes is in his employees because their salaries are a huge investment. Although this may not be the case in larger companies, in small companies employers are not facilitated in giving training to employees. Often this creates uncertainty for the employee, who experiences a diminished sense of value within the company. At present employees are walking out of jobs. Last week a butcher, who was getting £250 after tax as a trainee in my company, told me that he had been offered another job at £300 a week. People have such choice at present and that is what one is up against. He said the other job will suit him better because it will be more convenient. He was in an apprenticeship with FÁS and he received the proper training in Galway. He is leaving the butcher trade to take up a job as a labourer on a building site because he will get more money. That is why I feel that inflation is being fuelled by uncertainty. If the Department would allow expenditure on training, such as ISO courses or training modules at the regional colleges, which are empty in the evening, to be written off against tax, it would make the employees feel that they could get recognition and accreditation for their retail services skills. That would make people feel they had a worthwhile career.

As there are such differing perceptions about professions at present, there is a need to emphasise that a career dealing with the consumer is worthwhile. These jobs involve great skill and demand ability. Unfortunately there are certain jobs which are perceived as far more worthwhile than others.

A good industrial relations environment is essential if we are to maintain the current level of economic success. Last year's figure of some 215,000 production days lost was the highest since 1990. This occurred in a booming economy. There is a very clear message in that. People are totally unsettled and we have, in many cases, lost the run of the economy. Banks are dishing out money. I know of people who are being given 125% mortgages to buy houses. Credit card companies are dishing out money. We are talking about an economy in which people are not prudent with the money they are getting. There is an inflation rate of 6% or 7%, which is very worrying. People earning £300 or £400 per week do not have any more in their pockets than when they were earning £200 per week. People are being extraordinarily extravagant and are not managing money prudently.

A review of the industrial relations machinery is very important because our industrial relations performance, with some notable exceptions, has been outstanding. The economy's success is based, on a large part, on our ability to reach agreement by consensus, but frequently negotiations have been lengthy. The decade ahead is likely to see a pace of change which will accelerate and make flexibility and speed of response essential requirements in business.

I am delighted to speak on this Bill. The Labour Court is very important. Before people go into strike mode, they should first go through all the procedures. Unfortunately, it is used as a last resort in certain cases. What happened in Dublin Airport this week was regrettable. It is regrettable that people take, or feel they have to take, that route. This is a small economy with 3.5 million people and we have wonderful opportunities.

I am a believer in business, small business in particular, which is very important in small towns and villages. Small companies demonstrate dedication, commitment and perseverance. Employers, in certain cases, are the lowest paid. They believe in the service they are giving, they are not out to make megabucks, to go on two holidays per year or to work a 30 hour week. They work weekends and are the last to be paid. There is a perception that employers are taking much of the cash but they pay their employees, tax and expenses first and when the final accounts are done, more often than not, they are the lowest paid in the company.

This is an economy where, in certain cases, the fat cats in big companies are setting a bad example to employees who are getting £10,000 to £12,000 per annum. We must share and there must be a return for investment, a return for the work one does in a company. In certain cases, unrest has been created by a perception that has been generated, to a degree by Government, that we have a booming economy and that we can all go out and celebrate. We must remember that a large number of people are barely managing to survive – we must never forget that.

In small companies, perseverance, dedication and commitment are brought into the ethos of business and the bottom line is to give a service to the consumer. People must always remember that. Those who work for big institutions must fully realise that the customer, who pays all the bills, is the bottom line.

Mr. Higgins

(Dublin West): This is a pathetic response by the Government to a serious situation in the Irish economy concerning the civil rights of workers to join a trade union, to form a union in their workplace and to require employers to negotiate meaningfully with that union the wages and conditions of the workers concerned. This was originally supposed to be a trade union recognition Bill which would require employers to recognise unions and to deal with the workers who were members of them. What we have here is pathetic legislation so full of holes that rogue employers will continue to laugh all the way to their Ansbacher accounts or wherever they are salting away the gains. The legislation is so full of holes that any attempt to keep it afloat as a means of justice for working people in the face of recalcitrant employers will ignominiously fail – it will sink ignominiously.

Let us not forget that this legislation arose out of the Ryanair dispute in 1998 when about 40 baggage handlers exercised their civil right to join a trade union and were faced with a hard-line employer who refused to talk to the union, SIPTU, which the workers had joined. That management was so ruthless that it forced those workers into an industrial dispute and forced the closure of Dublin Airport for a period of time. That is the type of employer and management with which this Bill was supposed to deal.

The Long Title is an "Act to make further and better provisions for promoting harmonious relations between workers and employers." I am in favour of peace and love also but, unfortu nately, we have to deal with the world in which we find ourselves, the real character and nature of the forces operating in this world and the character and nature of the employers, with whom this Bill is supposed to deal, who are ruthless profit seekers who do not care a fig for the trade union, human or civil rights of workers when such rights conflict with their drive to maximise profits. That is the prevailing system – the market economy or capitalism, call it what you will.

If I remember correctly, the Taoiseach at the time of the Ryanair dispute, condemned capitalism that was red in tooth and claw. We do not usually hear language like that from the Taoiseach, the Fianna Fáil Party or the Progressive Democrats Party in government. So blatant was the activity of the chief executive, who was on £16 million per year, in denying the civil rights of his workers that even our conservative Taoiseach was forced to speak in those terms. This vessel full of holes is supposed to deal with people like that, but there is virtually no sanction as I will go on to show.

What is the situation in Ryanair at present? There is no trade union apart from that of the pilots who are in IMPACT now. The acid test is whether this Bill would give justice to Ryanair workers who wished to join a trade union, such as the 40 baggage handlers in 1998? There is absolutely no chance that would happen. Their situation under this Bill would be as difficult as the situation they faced following the dispute where scarcely none of them remain in Ryanair because of every trick that was used to get them out of the company, whether by harassment, victimisation or by ending their contracts when they had expired. There is no chance that this Bill would deal with that situation.

Before we even get into the procedures, the outs are there for the employers. Section 2(1)(f2>a) states that the court may investigate a trade dispute where the court is satisfied that it is not the practice of the employer to engage in collective bargaining negotiations and the internal dispute resolution procedures normally used by the parties concerned have failed to resolve the dispute. We have a phenomenon which, in the United States in the days of the wobblies, was called the company union or yellow unions, which are not trade unions but are a kind of smokescreen set up by the employers, drawing in some workers who would be, in many cases, stooges for the management and a small minority of the total complement of staff, to set up what might be called a works committee. The employers then claim that they deal meaningfully with these people and that they engage in collective bargaining negotiations. However, the structures of that committee will often be such that it will not satisfactorily address the grievances of significant sections of the employees. However, if the employees in this case then join a recognised trade union and begin to sue for negotiating rights on their wages and conditions, the employer can claim that the legitimate trade union cannot drag him before the Labour Court under the Industrial Relations Act, 2000, as he is covered under section 2(1)(a). Furthermore, section 2(1)(d) says with regard to industrial action,

the trade union or the excepted body or the employees, as the case may be, have not had recourse to industrial action after the dispute in question was referred to the Commission

We want to tie the hands of workers with this legislation while the procedures are gone through.

However, the length of time it takes for these procedures to be implemented or for the workers to go to the Circuit Court to have them implemented, is so ludicrously long that the cause of the dispute itself will probably be forgotten at that stage. It is quite incredible.

Section 10 states that:

Where an employer fails to comply with–

(a) the terms of a determination under section 6 within one year from the date on which the determination is communicated to the parties, or . . . an authorised trade union or excepted body may apply to the Circuit Court for an enforcement order.

The workers would have to wait for one full year after a decision has been handed down. If it is a favourable decision for the workers which vindicates their rights – which is not always guaranteed from the labour relations machinery – according to my reading of it, they have to wait a full year before the trade union can go to the Circuit Court to be included on the Circuit Court list which is months long, to compel a rogue employer to implement the terms of the determination in favour of the workers. An employer can appeal a Circuit Court finding to the High Court, so it will go on to the High Court lists resulting in more months of waiting. Two years could pass before the High Court would pronounce on the question put before it by a trade union, two years from the time the determination in favour of workers was first made.

Will the Minister of State return to the real world? As he and others are so keen to point out to us, the nature of employment is changing in this society. No longer are people able to slot into or have a job for life or a permanent pensionable position. We are told that we have to be flexible – what does that mean? It means contracts of six months, a year or 18 months. A group of workers on a six month, nine month or one year contract may go to the labour relations machinery on foot of this legislation and they will all be out the door a full year before there is a final determination, because the boss can end their employment, the contract having run out. It leaves me breathless.

Mr. Treacy

Does the Deputy not believe in due process?

Mr. Higgins

(Dublin West): I will go further. The percentage of workers in private employment who are trade unionised has fallen since 1987, since the deals between Government, employers and trade union leaders began to be put into effect. There are significant sections of the work force who are not organised in trade unions at the present time. Take the United States multinational companies which are operating in Ireland, for example, in the technological and computer-related sectors. A dramatic percentage of the total US investment by such companies in the EU is concentrated in this country, which is high compared to the percentage of the population of the EU we represent, probably more than 100,000 workers. Many of them are not trade unionised. I ask the Minister to return to the real world and read today's edition of The Irish Times under the headline “Market takes a pasting, ‘hit by a tidal wave' where it says: “An afternoon rally on Wall Street came too late for Dublin, which took a pasting after US stocks fell on fears for the US economy.”

We operate in a globalised economy as the Government will be quick to point out. What is the position of Irish workers within that globalised economy, those working for multinational companies? They are highly vulnerable to what happens in the US economy and in the world economy. I am not predicting a crash immediately, but it is quite clear that the tremors being felt in the markets in the United States is unfortunately a foretaste of what is to come. Unfortunately, US or any other capitalism cannot and will not continue to grow indefinitely, despite the delusion of some Members of the Government that the Celtic tiger can continue at growth levels of 8, 9 or 10% for the next 25 years.

Mr. Treacy

We never said that. We said if we managed the economy correctly, we could continue to grow it.

Mr. Higgins

(Dublin West): People think that, but unfortunately the iron laws of economic development will assert themselves. We are accused of not wanting this but, socialists want full employment. We are happy when there is full employment because it gives workers the confidence to look for what is rightly theirs within the industrial relations situation, in terms of the share of production that they should receive. We want to see full employment and the confidence in the capacity of workers increased. However, the iron laws of international capitalism will assert themselves, in the saturation of supply where goods will have no further market and therefore, there will be cut backs, retrenchments etc., with a tendency for the rate of profit to fall as a result in some cases. What then will those multinational companies do operating in this economy? They will ruthlessly retrench, cut back, return to their bases and let go thousands of Irish workers who have no union. The workers now, under the pressure of events, want to form a union and they will have to depend on this legislation to vindicate their rights, this legislation which provides that it could take two years before a court could pronounce on a favourable judgment on their behalf at which time the multinational concerned will have gathered itself up and gone to the Far East, far south or anywhere else where its profits will be greater. It is pathetic. We need a real trade union recognition Bill which will recognise the civil rights of workers to form a trade union and would oblige employers to recognise that union and to negotiate with it.

It is incredible that the leadership of the Irish Congress of Trade Unions would join IBEC in agreeing this legislation. Clearly, the leadership of the trade union movement has become absolutely toothless. They have become too used to the soft deals that were done between 1987 and the present. We have seen workers lose out again and again and we see it now with the inflation catastrophe.

Mr. Treacy

Inflation is a temporary problem. Look at the long-term.

Mr. Higgins

(Dublin West): I have and this year's wage increase—

Mr. Treacy

Is the Deputy against social partnership?

Mr. Higgins

(Dublin West): There is no such thing as social partnership. It is a myth. House builders are supposedly the social partners of working people. What kind of partners would double and treble the price of a house in four years and deny their partners the ability to buy a home? Is that partnership? Social partnership is a cover for holding down wages to the minimum while profits, speculative ventures, dividends and rents are allowed to go through the roof uncontrolled. The Government has refused to lift a finger in any meaningful way to control rents and the rip off the so-called partners of the people are getting away with.

It beggars belief that the trade union leadership agreed to this. What is needed in our industrial relations is a little less corporatism and a little more Larkinism. It is no accident that the Aer Lingus strike burst like a cloud on the Government. I was aware of the rates of pay because I am in touch with the workers who are my constituents but when people became aware of them they were astounded. The Dublin bus strike burst on top of the Government and when people saw the low level of bus drivers' pay they were shocked. That is what so-called social partnership has delivered.

IBEC and ICTU laboured long and hard but instead of a mountain they produced a molehill. This legislation, which is two or three pages long, is useless. The Government is happy that this was produced because it has a minimalist strategy on everything. The Bacon report was an excuse to pretend to do something about house prices.

Mr. Treacy

It has affected the position.

Mr. Gilmore

For the worst.

Mr. Naughten

God help those looking for rented accommodation.

Mr. Higgins

(Dublin West): The national minimum wage gives a paltry £4.40 an hour but tens of millions of pounds are taken back in taxation. Waitresses' and waiters' gratuities are taxed.

Mo náire an Rialtas agus mo náire an t-Aire a thug an Bill seo os comhair na Dála: Bille dá ngairtear Acht do dhéanamh socrú breise agus feabhsaithe chun caidreamh comhchuí a chur chun cinn idir oibrithe agus fostóirí. Sé atá ag teastáil, bille chun athnuachan a thabhairt do cheardchumainn agus cearta sibhialta a thabhairt don lucht oibre. Tá bille ag teastáil a chaomhnódh cearta an lucht oibre agus a chuirfeadh iachall ar fhostóirí géilleadh do na cearta sin agus dul ag caint leis an lucht oibre. Ba chóir sin a bheith leacaithe isteach in Acht de chuid Dháil Éireann ach ní tharlaíonn sé anseo. Má ghlactar leis an mBille seo feicfear ins na blianta atá romhainn nach fiú tráithnín é.

Notice taken that 20 Members were not present; House counted and 20 Members being present,

Mr. Gilmore

I thank the Members of the Government parties for coming into the House to hear what I have to say. Deputy Higgins should not make the mistake of confusing the responsibility of Government with the role of the Congress of Trade Unions or the social partners in the discussions they must have. This is a Government Bill and the responsibility for its introduction is that of the Minister and the Government who approved it. Even Jim Larkin and James Connolly were criticised in their time by the predecessors of Deputy Higgins for the necessary compromises they had to make in the course of negotiating with the employers of their time. That is part and parcel of the role of the trade union movement and it should not be confused with the role of Government nor should the inadequacies of legislation introduced by Government be visited on the heads of the leaders of the trade union movement, whose role, after all, was primarily a consultative one prior to the preparation of the legislation.

The Bill provides a dispute resolution mechanism in circumstances where there has not been collective bargaining between the representatives of employees and an employer. It is certainly not, as my colleague, Deputy Rabbitte, said earlier, a trade union recognition Bill. It does not give workers the right to be represented by a trade union or a statutory right of representation before their employer. It seeks to put in place a somewhat long and, in many respects, rather risky procedure for the resolution of disputes. I will return later to the inadequacies of the procedure that is being put in place.

What is needed at this stage in our industrial relations history and the development of our economy is legislation which gives workers the statutory right to be represented to their employer. It is a cliché to say the world of work has changed quite dramatically over the past 20 years but it has, as has the way in which workers are, and need to be, represented. Twenty years ago, over 60% of the labour force in this country – which was, admittedly, a smaller labour force at that time – were in trade unions. It was then the norm for a worker to be in a trade union. Most of those not in trade unions at that time were those in highly paid professional or managerial jobs, people working in family businesses and people working in very small employments where, due to the economies of scale, it was difficult to join a trade union. A handful of large employers were hostile to trade union organisation.

That has changed quite dramatically today. We now have a situation where, admittedly with a larger workforce and a consequent larger numerical membership of trade unions, the penetration of trade union organisation among the workforce as a whole has declined quite dramatically. It is now less than 40% of the total workforce and is mainly concentrated in public service employment and some of the traditional industries. Only about 25% of the private sector workforce is in trade union membership and about 700,000 private sector workers are not members of any trade union.

There is a certain image of that labour force that, for the most part, they are highly paid, white coat, IT workers in multinational companies, mainly working for employers who have a culture in their own countries which is not friendly to trade union organisation. However, the evidence belies that. There are only about 100,000 workers in that sector of the economy, many of whom are organised and work for companies with a domestic trade union friendly culture. Therefore, the vast bulk of private sector workers who are not members of a trade union are employed in Irish companies and, for one reason or another, have not chosen to exercise their constitutional right to be a member of a trade union.

The declining proportion of the labour force who are members of trade unions gives rise to a number of issues which are wider than the rights of individual workers or whether they are individually better off to be in a trade union. The first is the issue of partnership, about which we hear so much. We all accept the social partnership model this country developed over the past decade and a half – which was based on predecessors such as the old national wage agreements and national understandings which were the norm, for the most part, in this country since the early 1970s – has made an enormous contribution to the development of our economy. However, we now have a situation where only 25% of the private sector labour force had the right to vote on, for example, the PPF national agreement. Three out of every four workers in the private sector have no opportunity – by their own choice because they have not joined a trade union – to vote on the partnership agreement which deals with everything from pay movement to the wider economic and taxation issues. That is seriously unhealthy and one of the weaknesses we will see increasingly in the partnership model. We all have an interest in seeing that put right.

The second issue which is wider than just the question of the individual worker concerns representation. There are now 700,000 workers in the private sector who do not have a formal means of being represented to their employer. That is a very unwise and, in many ways, irresponsible state to be in. It is like driving without insurance. None of those 700,000 workers would dream of buying a house without having it surveyed by a professional, entering into a contract without having it looked at by a solicitor or buying a second hand car without having a mechanic look it over. However, for the most part, workers in the unorganised sector of the economy, which now includes the vast majority of workers in the private sector, conclude an employment agreement with their employer without anybody looking at it first. They go through their employment without any formal means of representation or having professional advice made readily available to them if something goes wrong. We are talking here about agreements that affect their income, their security, how their mortgage will be paid and their pensions.

That may be fine at a time when the economy is growing and there is a labour shortage. However, in the last seven or eight years of my time working as a trade union official with the then Irish Transport and General Workers' Union I was responsible for the organisation and unionisation of managerial and professional workers. I do not know how many senior managers I met during my work as a trade union official who had never joined a trade union but who had exactly the same problems as the person on the shop floor the day the notice arrived from North Carolina, or wherever, to say the company was closing down. I met many managers who never thought of joining a trade union but who suddenly found when they were 52 or 53 years of age that the company was getting a new broom and they were no longer needed and were being pushed aside. They needed professional help.

Traditionally, in this country the trade unions were there to provide assistance, professional skills and advice and, if necessary, negotiating skills to deal with the problems of workers who had chosen not to be in a trade union but who, when the problem arose, decided they needed to join a trade union. In a climate where a declining proportion of private sector workers are trade union members, that option may not continue to exist in its present form.

It is unrealistic to expect that workers who are not in a trade union will not at some point in the longer term find some means of ventilating their grievances. In some cases it may be exercised through people going to lawyers through the development of a form of labour law and negotiating employment contracts which is common in the United States where people go to lawyers. Part of the settlement with the employer ends up with the employer paying the legal costs associated with the processing of the dispute. In some case it may mean groups of workers decide to take some form of protest or agitational type of activity outside the normal trade union negotiations and the use of the industrial relations machinery perhaps in an undisciplined way or in ways that people may not wish to see in the interests of good industrial relations. If the means of being represented by a trade union is frustrated and is not vindicated, workers will find alternative ways of dealing with their employer. They may not be the best ways in their own interests, in the interest of their employment or in the interests of the economy. The reason I make this point is that there is a misunderstanding in regard to what the Ryanair dispute was about.

The Ryanair dispute is the trigger that sparked this legislation which, in turn, was a response by the Government to the Private Members' Bill introduced by my colleague, Deputy Broughan. The core issue in the Ryanair dispute was not trade union recognition as traditionally understood. There is the idea that trade union recognition disputes are about the economics of trade unions rather than the rights of workers in many respects. The issue in the Ryanair dispute was about the right to be represented. The workers in Ryanair were seeking a right to be represented by an agency or a body of their choice. The legislation should provide that the individual worker or a group of workers would have a statutory right to be represented in relation to their employment contract by a representative of their choice. For the most part that would be a trade union. That position is not being vindicated in this legislation.

Since I have mentioned the Ryanair dispute and have spoken about it frequently here when the dispute was in progress, this is an opportunity to revisit it. The Ryanair dispute has left industrial relations with two legacies that it will find difficult to deal with. The first legacy is the huge puncture the Ryanair dispute delivered to the concept of partnership. Workers in strong bargaining positions, workers in essential services and those in areas of labour shortages learned a simple lesson from that dispute. We have witnessed examples of this in some of the disputes in the wider public sector area. The lesson learned was simple. If a big employer could use his economic muscle to give the two fingers to partnership, a group of workers in a key area of the economy, if they have the economic and bar gaining muscle, can do likewise. There is increasing evidence of that. It will be increasingly difficult to tell those workers why they should not do it when the State and all its agencies, right up to the Taoiseach, was not able to bring Ryanair's Michael O'Leary to heel.

The second legacy it has left, and one we are beginning to see in Aer Lingus and will increasingly see in other areas of employment, is that if somebody can come on the scene and say there will be competition for air fares, it is fair game to say there should be competition for trade union membership. The second lesson being learned, one I regret as it will cause enormous difficulties not only for the trade unions but for the entire industrial relations process, is that if you do not get the service you want today from one trade union in relation to a particular dispute you shop around and get it from another. We may see more of that.

What is required is legislation which gives to workers the statutory right to be represented to their employer in relation to their contract of employment. This Bill does not do that, it expressly excludes that. Section 5(2) states that a recommendation to be made by the Labour Court shall not provide for arrangements for collective bargaining. In other words, it is enshrining in legislation the right of an employer to refuse to negotiate with a representative of the employee's choice. The procedures being set down in this Bill, unless amended, will create enormous difficulties. The first difficulty will be in relation to access to the Labour Court. For a trade union to have access to the Labour Court a group of workers will have to join a trade union but the employer decides not to talk to them. The trade union wants to proceed with whatever grievances, difficulties and claims the workers may have and decides to make a reference to the Labour Court under this Bill. The trade union will have to satisfy a number of conditions which are fraught with danger. It will have to establish that it is not the practice of the employer to engage in collective bargaining negotiations.

To get over that difficulty all an employer needs is some kind of an uncle Tom – no offence to the Minister of State – staff association in place. It can then say that collective bargaining procedures are involved and that it has spoken with the staff association. People who have joined the trade union may well have the view that the staff association involves a crowd of licks who are in the employer's pocket and will not negotiate anything for them, but if there is collective bargaining in the employment there will not be a right of access to the Labour Court. That is my understanding of the Bill as I read it.

Second, there is the question of the trade union or the employees, as the case may be, acting in a manner which has frustrated the employer observing a provision of a code of practice. That is a wide condition. It remains to be seen how that will be interpreted. Third, neither the trade union nor the employees would have recourse to industrial action after the dispute in question was referred to the commission. There could be a situation where a group of, say, 30 or 40 workers in a large employment who have a grievance concerning pay join a trade union but the employer does not speak. The trade union refers the grievance about pay to the Labour Court and asks the Labour Court to deal with it under this legislation. The employer recognises if there is an industrial action in the employment he does not have to have it dealt with by the Labour Court. He provokes a situation whereby industrial action takes place. He makes some unreasonable demand on employees and they refuse to do it, he sacks the shop steward and a group of workers act spontaneously to that form of provocation. This results in industrial action and consequently the right of recourse to the Labour Court is cut off.

I cannot find in the Bill any provision that obliges the employer to attend the hearings. As a former trade union official, I had some experience of section 21 procedures in the Industrial Relations Act. Under those procedures one brings an employer to the Labour Court on the understanding that, in doing so, one is bound to accept the finding of the court in that case. If the employer does not show up, there is no means of obliging him or her to attend. The Labour Court knows that if it issues a recommendation the union may be bound by it but there is no means of implementing it. Consequently, that influences the type of recommendation that is made.

Mr. Ring

I compliment my party spokesman, Deputy Naughten, on his contribution this morning. I listened carefully, too, to Deputy Gilmore. I am aware he was a trade union representative before he came into politics and I compliment him on his extensive knowledge of that area.

I was never in a trade union, having been self-employed all my life. People regularly give out about trade unions and claim they are an unnecessary evil. However, I am glad the trade union movement has been strengthened and that it is now active in many sectors where it was not active in the past. For many years employers treated staff badly, particularly when there were 300,000 people unemployed. Being from the west of Ireland I am familiar with the tourism industry, which did not treat its workers properly. Other speakers referred to supermarkets. We saw how Dunnes Stores and other supermarkets treated their staff and how the unions had to fight for the workers.

I am delighted there are unions because they are necessary. Recently a factory in Kiltimagh went into liquidation. Everybody was paid except the workers. They were given their statutory entitlements but nothing from the company. The banks had first claim on the funds realised from the sale of the property. The workers were last on the list and to this day I do not know if they were given their due reward by that company. There would have been nobody to fight on their behalf if the union had not been there.

I welcome the Bill if it will settle disputes. Everybody is aware of the dispute which took place this summer. It went on for ten weeks. During the first few weeks I and some other Members sought to question the Minister about it. She just threw up her hands and said she had no power and could do nothing because it was outside her control. The dispute continued for ten weeks. As a public representative, I came under tremendous pressure from the ordinary people who depended on public transport, particularly the train service, to get to hospitals and go about their business. They had no other means of travelling.

For ten weeks no trains came to or left the west and nobody did anything about it. There was plenty of talk and media coverage but the dispute continued and the community in the west of Ireland suffered. Of course, if the DART did not run for ten minutes the Minister of State, Deputy Kitt, the Minister, Deputy O'Rourke, the Tánaiste, the Taoiseach and every other Minister would call on Iarnród Éireann, the workers and everybody else concerned to sit down to talks. The greatest negotiator of them all, the Taoiseach, would probably bring them to the round table and the dispute would be settled.

However, because only the west of Ireland was affected, the rail dispute did not matter. The west did not count. The workers and the people who used the service did not matter. The attitude was, "We cannot do anything about it so forget it". The Dublin Bus dispute only lasted a few days and the Minister will remember it well. I thought there had been an earthquake in Dublin. The story was on every radio programme and RTE ran it every hour on the hour as if it was the most awful thing that had ever happened. Yet the people in the west of Ireland had no train service for ten weeks. We do not have the DART, only a bad bus service. Even worse, we have no roads. If we had roads, we would not have been too badly off. There is no road from Longford to Charlestown. It is disgraceful.

However, the attitude was that nothing could be done about the dispute. The Minister said that neither she nor the Government could intervene. I hope we never again see a dispute where so many people's livelihoods were so badly affected. The west of Ireland had a bad tourism season because visitors had no transport. They were planning to use Ireland's public transport system and what happened? The same thing that will happen next Christmas. I can tell the House now what disputes will occur over Christmas.

Tourists were depending on public transport to get to their hostels and to travel throughout Ireland. Before they arrive here they are notified about their timetables for trains and other services. Their times and programmes were ready but the entire system was disrupted because there was a dispute in the rail service to the west which lasted for ten weeks. The same thing will probably happen this Christmas. The ESB is now talk ing about a dispute. When will the dispute occur? Probably as we approach Christmas. It is a little like Aer Lingus. For the last 20 years there has been a threat of disputes over the Christmas period when thousands of people are travelling to this country from abroad. There is now another threat.

People are entitled to a just wage and to be represented by their unions. However, there should be a process to deal with disputes. There is the Labour Court and many other such mechanisms but why must there be a strike before these things are settled? Why must the general public always be inconvenienced? If companies foresee a problem and are not prepared to negotiate, this Bill will deal with it. Pressure will be put on both sides to negotiate and try to resolve the dispute without everybody else being hurt first.

There is a great deal of discontent in the country at present. The Government is to blame because it has let inflation get out of control. People were satisfied with the increases they were due under the national wage agreement but not with inflation at 6.2%. The rate will probably increase. Last year I questioned the figures being thrown out by the Central Statistics Office. I questioned the figures in the Dáil and some of the national media picked up the story. It was not popular at the time. People were claiming there was no inflation. I questioned the figures 18 months ago and I was correct. We were not getting the correct figure. We were told that inflation was running at 1% and 2%. The people who were compiling the figures for the Central Statistics Office must not have been buying bread, petrol or diesel. They could not have been shopping in Ireland. If they were, they would have known that prices were going out of control.

The Minister for Finance now acknowledges that 6.2% is probably not the correct figure either. He expects it to rise. I hope not for the sake of the economy and the country. The Government should do whatever is necessary in the budget and not frame it with an eye to a general election. I hope this Government, for the first time ever, will put the country first, not Fianna Fáil and the election. The economy has grown, there is plenty of employment and we are doing well. That should not be destroyed by a reckless Government and Minister for Finance. It should not be destroyed by Fianna Fáil using the next budget, because an election is not far away, to get back into power. I hope the Government has the courage to deal with this issue.

Deputy Gilmore spoke about Ryanair and there is now a problem in Aer Lingus. While watching RTE the other night, I was amazed at the amount of money some of these workers are earning. The general perception was that staff who worked for Aer Lingus, particularly the cabin crews, were working for one of the best companies in the country and would never strike. Many people believed they were getting so much money they did not need increases. I have a lot of sympathy for these people, given the measly amount of money they earn. The company must negotiate with the staff and not take such a hard line approach. Ryanair would not allow its staff to have union representation. This is not good for the country or for workers.

I compliment Deputy Naughten on raising the issue of foreign workers coming to this country from outside Europe. These people are being brought here because of a shortage of workers. I hope these people will not be abused in the way the low paid were for 40 or 50 years when things were bad and 300,000 were unemployed. I hope foreign nationals will be protected in the same way as Irish nationals who are members of trades union. These people must not be treated like my father and others like him who had to emigrate to another country and work seven days a week. They had no union representation and if they did not arrive at their place of work in the morning or evening they would be told to go home. Now that there is near full employment in this country, Irish and foreign workers must be protected and not abused.

People here are very good at telling others how to deal with their problems. I listen to Members on the Order of Business each morning voicing great concern at what is taking place outside the country. However, they do not seem to be as concerned about what is taking place within the country in relation to the rights of workers. As spokesman on health, I find it hypocritical that the State has appointed an inspectorate to oversee private nursing homes while there is no such inspectorate to oversee public nursing homes. I have been raising this issue for a long time. An inspectorate should be put in place to oversee both public and private nursing homes.

I wish to talk about employment in Mayo and in the west generally. There is a great imbalance between the amount of development taking place along the east coast, particularly in Dublin, and along the west coast. The Government does not seem to have the courage to relocate some of the development to the west. The IDA will say it is doing its job in bringing industrialists to the country and creating employment but that it is up to the Government to distribute the industry. The west did not do well in the recent IDA report. This region has again fallen behind. A company called Warners used to be located in north Mayo and this is why I wish to refer once again to unions and grant aid. Deputy Gilmore spoke about American companies and people in America making decisions which affect people here, be they workers, foremen or managers. Warners were in this country for many years and at one time employed approximately 300 people. Last August it decided to pull the rug from under the workers. I tabled a Dáil Question to find out if the funding had been returned to the Government or to Údaras, given that the company received a lot of State funding. However, the company kept within the law, it remained in the country for ten years before pulling the plug. To be fair to the company, the workers received their redundancy payments and there was no dispute in that regard. This proves that many companies do not care about the country or the workers and they should not be allowed to create their own rules and regulations. If companies wish to set up in this country, they should be obliged to protect their workers. If they do not want workers to have union representation, they should not receive grant aid from the IDA.

The Minister of State has a great responsibility in relation to the gas find in County Mayo. I hope the Government will do the correct thing in this regard. This is the first time a natural resource has been discovered in that area and I hope the Government will put the pipeline in place. I hope this will create the employment which has been so badly lacking in the past. I am aware Bord Gáis will say this is not feasible, but the Government has a moral obligation to look after the west, particularly north Mayo, which is the biggest unemployment black spot in the country. Last year, Údaras created approximately 170 jobs and lost approximately 270 in the area. This has happened consistently for the past three years. I hope the Government will take the correct decision in relation to the gas pipeline. The Taoiseach took part in a photocall recently with Bord Gáis. Some £100 million will be spent to bring the pipeline from north Mayo to Galway. As the Minister of State knows this pipeline will continue to Dublin and probably to Belfast. The people of Scotland, Northern Ireland and England will probably benefit more from this than the people of north Mayo. I hope the Government will not fail the people of north Mayo where this natural resource has been discovered. The roads infrastructure and gas pipeline must be put in place. The Government must give a commitment that the people of Belmullet, Crossmolina, Ballina, Castlebar and all the other towns in County Mayo, even if it is not viable, will be able to say to industrialists coming to the country that they have the gas, it is a cheap commodity and is something the company will be able to use. I hope the Government will do the right thing on this occasion for the people of the west.

I hope the dispute which took place during the summer will not take place again. It should not have gone on for ten weeks without something being done to solve it. What happened should never happen again. The dispute was not settled but the workers went back to work after ten weeks. This should have happened after one week. People's livelihoods should not be put at risk in this way. Mechanisms should be put in place to deal with such disputes. I hope as a Member of this House that I will never see a Minister, a Taoiseach or a Government putting their hands up and saying they cannot do anything about such disputes. Politicians are elected to represent the people and to put in place legislation to deal with such problems. We as legislators must introduce legislation to correct what happened during the summer. We must not allow a dispute to take place where a whole region is disadvantaged and because it is not a national problem it is not dealt with by the national Parliament. I have great sympathy for those who were out of work for ten weeks. Nevertheless, great inconvenience was caused to the general public. We are supposed to represent and legislate for those people. I hope this legislation will do what is necessary and that a Minister or Government will never put up their hands to say it has not worked.

Mr. Broughan

I share Deputy Ring's profound concerns about the hard pressed west, which he and Deputy Naughten represent. This Bill will do absolutely nothing, as the Minister of State well knows, to resolve a dispute such as that involving ILDA during the summer. There is nothing in this flimsy document which would in any way resolve a dispute where a relatively small group of workers seeks to engage in a major campaign for improved pay and conditions to which they are entitled. That recent industrial relations dispute affected many parts of Ireland but there have also been severe industrial relations problems on the DART system in Dublin. A significant number of trains are not running in my constituency because of an industrial relations problem and the Minister of State has taken no action.

The sad reality is that after three and a half years of delay, obfuscation and reports of high level groups, the Tánaiste, Deputy Harney, maintains her profound, deep ideological abhorrence of the trade union movement and our colleagues in the Labour movement and is absolutely determined not to give recognition to that movement in the industrial relations sphere. Why is the legislation not entitled the trade union recognition Bill similar to the Labour Party Bill that was introduced a number of years ago? The Minister of State did not do so because the legislation is a flimsy and pallid copy of the Labour Party's Trade Union Recognition Bill, 1998, and it goes nowhere near resolving some of the fundamental issues attaching to trade union recognition. Aspects of the legislation will add to labour law but it will not take us far forward.

Labour Party members from Dublin and surrounding counties stood on the picket line a few months ago on Parnell Street for many days with the ALDI workers. ALDI is a German company which set up in Dublin. Germany has trade union recognition and long, well established industrial relations procedures but the company chose not to recognise MANDATE or any other union to professionally represent the company's workers. This again illustrated in those painful days when we stood on the picket line at Parnell Street that the Tánaiste and Minister of State had not come to grips with one of the realities of modern society.

Previous speakers, including Deputy Gilmore, referred to the core of the Ryanair problem. We marched in unison with our trade union colleagues two years ago when our Trade Union Recognition Bill was to come before the House. I am grateful that in the intervening period Ryanair's pilots have secured trade union recognition and are represented by IMPACT. The fundamental issue of the constitutional right of a citizen to be represented professionally by a trade union still has not been addressed.

Notice taken that 20 Members were not present; House counted and 20 Members being present,

Mr. Broughan

I thank my colleagues for coming to the House to listen to my contribution. I referred earlier to the entrance of the German food companies into the Irish market. This is a growing trend and my constituency is awaiting the arrival of the second German retail distribution company. Local staff and workers are interested to know if a company which adheres to trade union recognition in its homeland will do so in Ireland. However, it has not been given much encouragement in that regard by the Government in the Bill.

One of the features of the economy's performance over the past five or six years has been the massive expansion in the working population. There is an additional 500,000 workers, bringing the total workforce from 1.15 million to 1.7 million people. The vast majority of those workers are non-unionised and although many of them have trade associations and in-house representatives, they still have a profound interest in being allowed to be represented by a trade union.

From my contacts with workers in companies such as Intel and other high tech digital companies around the northern fringe of County Kildare and Dublin, there is no recognition in those operations and workers find it difficult to have any type of professional representation in relation to their contracts when they are ill or when they return to work after illness. The hours are lengthy and workers are expected to have a Californian type of commitment without Californian wages. The wages in the company's homeland are still significantly higher than in Ireland.

There is deep concern in the trade union movement and among most citizens about the manner in which the economy has developed and the relative fall in unionisation, particularly in the private sector. Although many of the high tech companies have opted for a measure of trade union recognition, it is still the case that the vast bulk – over 70% – of private sector companies are not unionised and workers do not have the right to professional representation. Despite the Minister of State, Deputy Kitt's efforts, the Labour Party still considers that this is a profound problem and a profound issue of fairness facing society.

During the Ryanair dispute workers rightly asked if it was appropriate for Michael O'Leary, the chief executive, to have professional rep resentation at the highest level to negotiate his £17 million per annum basic emolument – since then he has become super rich with hundreds of millions of pounds from his share options – why was it not right for cabin crew, baggage handlers and other workers that SIPTU and more latterly IMPACT have sought to represent? There is a fundamental issue of fairness and in the hope that the Labour Party will have a direct influence on Government policy in the future, this is an area to which we will return. We will profoundly consider developing this pallid Bill which contains many holes and does not solve many of the issues that have arisen with regard to ILDA, the ALDI dispute and, most importantly, the Ryanair dispute.

The Bill has striking differences from the Bill I was proud to introduce on behalf of my Labour Party colleagues. One of the fundamental differences relates to the role of the LRC. It has not been codified in legislation although I am aware of the code of practice on voluntary dispute resolution through the LRC to which the Minister of State referred earlier. There are steps employers and workers must take before the Bill triggers the intervention of the Labour Court. However, in comparison to the Labour Party Bill, there are fundamental gaps.

The Minister of State said that matters will go to the LRC which will appoint an officer from the advisory service. The LRC will work with the parties and an agreed cooling off period will be put in place. The LRC's advisory service will continue to work with the parties but the fundamental problem with that is the absence of a timeframe. There is no timeframe of any description in terms of how these steps will be taken. As an earlier speaker noted in relation to the rail dispute, the critical timeframe for consumers could be a matter of hours and certainly days.

One might be supportive of the workers' just demands, but if one is depending on an essential bus or rail service in Mayo or west Cork, one would hope that the issue would be resolved in a specified timeframe. The Minister of State has failed dismally to incorporate this step in the legislation and to clearly spell out the timeframe to be operated to the satisfaction of the parties to a dispute. I draw the Minister of State's attention to this aspect.

The Labour Party Bill sought to consider the issue of representation. It is a difficult issue and, based on the ICTU document, the first report of the high level group came up with various levels of representation. However, it at least addressed the fundamental issue of the professional representation of workers by trade unions. There is nothing of that sort in this Bill. The Labour Party Bill included a provision where the Labour Court could order ballots and assess from various standpoints the ability of the trade union to represent different groups of workers.

Deputy Rabbitte drew the House's attention to the situation where a few dozen workers from a total workforce of 600 might seek professional representation or where workers in a company, who had been quiet members of a trade union for some time, might seek representation on the core issues of pay and conditions and ask the company to give their trade union some input into their future. Under this Bill, this would be dismissed out of hand because there is no provision to enable their level of support or the representations they could make to be measured. There is a huge lacuna in the Bill where the Minister of State has failed to address the status of the representation of employees and the people who seek to represent them.

My fundamental criticism relates to the steps leading to the preliminary hearing through the Labour Court. Section 2(1)(c) states: “the trade union or the excepted body or the employees, as the case may be, have not acted in a manner which, in the opinion of the Court, has frustrated the employer in observing a provision of such code of practice”. It glosses over the whole issue of the extent to which an industrial dispute was already under way.

Debate adjourned.