Protection of Employment (Exceptional Collective Redundancies and Related Matters) Bill 2007 [Seanad]: Second Stage.

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

As a result of the recent partnership talks on Towards 2016, it was agreed that this Bill should be enacted to provide for the establishment of a redundancy panel for the reference to it of certain proposed collective redundancies and for related action by the Minister for Enterprise, Trade and Employment. Members will recollect that the controversy surrounding the Irish Ferries case gave rise to this provision.

The opening up of the Irish labour market arising from the decision to permit direct access by citizens of the new EU member states has given rise to concerns about the possibility of the collective compulsory replacement of workers by lower paid workers from those states or elsewhere either directly or through the use of other replacement workers within the jurisdiction. In Towards 2016, there was agreement that this practice has the potential in certain circumstances to be harmful to the maintenance of good industrial relations. At the same time, there was full agreement on the need for co-operation with ongoing change in response to competitive pressures, as well as the need for adaptation and flexibility when market conditions require, since they will underpin sustainable employment and conditions in enterprises.

There is full recognition and acceptance that all parties to this agreement carry a responsibility to ensure their conduct is reasonable and that they act in good faith in dealing with the timely development, processing and implementation of competitive measures that may arise, as a consequence of which the best possible levels of employment and conditions can be assured.

The Bill provides for the removal of the upper age limit for entitlement to redundancy payments. It will also give effect to the judgment of the European Court of Justice in the Junkv. Kuhnel case regarding consultation with employees as required under Directive 98/59/EC being completed before notice of dismissal in given. The Bill makes consequential amendments to a number of items of legislation.

It is the Government's intention that the Bill be enacted quickly so that the protection it contains can be made available at the earliest opportunity. The Secretary General of the Department of Enterprise, Trade and Employment shall arrange for the provision to the redundancy panel of all secretarial and other services necessary for its efficient operation. The fees and expenses of the panel are expected to be minimal and are provided for in section 5. The costs to the social insurance fund of including over 66 year olds under the Redundancy Payments Acts is estimated to be in the region of €2.4 million per annum.

I would like to outline in detail the main provisions of the Bill. Sections 1 and 2 provide the Short Title and definitions of terms used. The definition of "industrial action" combines the content of the definition of "strike" in section 8 of the Industrial Relations Act 1946 and that of "lock-out" in section 6 of the Redundancy Payments Act 1967. The definitions of "Minister" and "Secretary General" are self-explanatory.

Section 3 provides for the duration of the panel and related matters. Under this section, the panel has effect only for the period of three years from the commencement of this legislation. The Minister may, by order made before the expiration of that period or of any extension of it, extend that period for a further period of three years if both the Irish Congress of Trade Unions and the Irish Business and Employers Confederation have requested the extension and the Minister is satisfied that the continued operation of the panel would be conducive to the continued orderly conduct of industrial relations.

Section 4 sets out what constitutes exceptional collective redundancies for the purposes of this Bill by reference to the Redundancy Payments Act 1967. Section 5 provides for the establishment of the redundancy panel, procedures to be followed in appointing its members and their re-appointment. The conditions of membership are also set out in this section.

Section 6 provides for referral of cases to the panel by employee representatives or the employer concerned by notice given in writing and addressed to the panel's chairman. The panel shall invite affected parties to make submissions to it in respect of the proposal. It shall give notice in writing to the Minister that either requests him or her to seek an opinion from the Labour Court on whether the proposal is a proposal to create exceptional collective redundancies or else states that the panel is of the opinion that the conditions for the making of such a request have not been satisfied. The panel must give a copy of that notice to the party from which the reference was received and other affected parties.

The redundancy panel may not make a request to the Minister unless it appears to the panel that the proposed collective redundancies are "exceptional" collective redundancies and the panel is satisfied that, in respect of the proposal, the party from which the reference was received has unsuccessfully sought to resolve the matter through local engagement. The panel must also be satisfied that the party from which the reference was received has acted reasonably, has not acted in a manner which has frustrated the possibility of reaching agreement to restructuring or other changes which may be deemed necessary to secure the viability of the business of the employer and has not had recourse to industrial action since the proposal was referred to it.

Section 7 provides that the Minister may, within seven days of receiving a request from the redundancy panel to do so, ask the Labour Court to issue an opinion on whether the collective redundancies proposed by an employer constitute "exceptional" collective redundancies. The Minister may also make a request the Labour Court on his own initiative if it appears to him that the proposed collective redundancies are "exceptional" collective redundancies. The time limit in this latter case will vary depending on whether the matter has been referred to the redundancy panel.

Section 8 provides for a hearing and the giving of an opinion to the Minister by the Labour Court that the proposed collective redundancies are "exceptional" collective redundancies or that it is unable to issue an opinion. The Labour Court may not issue an opinion unless it is satisfied that the party from which the reference was received was unable to resolve the matter through local engagement and has not frustrated the possibility of agreement to restructuring, and that no industrial action on the part of that party is current. No appeal shall result from an opinion given by the Labour Court under this section. The Employment Appeals Tribunal can make a decision on any question referred to it under section 39 of the Redundancy Payments Act 1967.

Section 9 provides that if the Labour Court issues an opinion that the collective redundancies proposed by an employer are exceptional collective redundancies and, having proceeded with the dismissals on the same basis as in the relevant proposal the employer applies to the Minister for a rebate under the Redundancy Payments Act 1967, the Minister shall have regard to the opinion of the Labour Court when considering the application for the rebate. If the Minister refuses to pay the rebate on the basis of the Labour Court's opinion, the exemption from income tax provided by section 203 of the Taxes Consolidation Act 1997 will not apply to lump sum payments made by the employer to employees who have been dismissed. Section 7 of the Unfair Dismissals Act 1977 has effect, with modifications, in the case of a dismissal that is one of a number of dismissals included in a collective redundancy that is determined by the Labour Court to be an "exceptional" collective redundancy. The compensation payable will be such amount as is just and equitable, but it may not exceed pay for 208 weeks in the case of an employee who had not more than 20 years of continuous service, or pay for more than 260 weeks in the case of an employee who had more than 20 years of continuous service.

Section 10 sets out the time limits before which dismissals may not take effect. An employer who effects a dismissal before the expiration of the period specified in section 10(1) of this Bill, or sections 9(3) or 12(1) of the Protection of Employment Act 1977, as the case requires, will be deemed to be guilty of an offence and liable on conviction on indictment to a fine up to €250,000. Sections 11 and 14 provide for the amendment of section 2 of the Protection of Employment Act 1977 to update the definition of "Minister", while section 22 does the same in the case of the Redundancy Payments Act 1979, as does section 24 in the case of the Unfair Dismissals Act 1977. Section 12 provides for the amendment of section 9(3) of the Protection of Employment Act 1977 to reflect the decision of the European Court of Justice in the case of Junkv. Kuhnel. Section 13 provides for the updating of penalties in the Protection of Employment Act 1977. Section 15 provides for the amendment of section 4 of the Redundancy Payments Act 1967 to entitle employees who have reached the age of 66 years to statutory redundancy.

Section 16 provides for the amendment of section 7 of the Redundancy Payments Act 1967. A new subsection 7(2A) will be inserted in the 1967 Act to ensure that the dismissal of employees will not be taken to be a dismissal by reason of redundancy if the dismissal is collective and is effected on a compulsory basis, and the dismissed employees are to be replaced at the same location or elsewhere in the State by other employees who are directly employed by the employer or other people whose services are to be provided to that employer in pursuance of other arrangements where those other people perform, or are to perform, essentially the same functions as the dismissed employees, and the terms and conditions of employment of those other people are, or are to be, materially inferior to those of the dismissed employees.

Section 17 provides for the amendment of section 38 of the Redundancy Payments Act 1967 to delete references in paragraphs (a) to (c) to certain powers which are no longer required to be exercised and to authorise deciding officers to make decisions under sections 29 and 32 in respect of certain payments from the social insurance fund. Section 18 provides for the amendment of section 39(16) of the Redundancy Payments Act 1967 to eliminate the requirement that the reference of appeals to the Employment Appeals Tribunal by deciding officers be made in a particular prescribed manner. Section 19 provides for the updating of penalties under the Redundancy Payments Act 1967, while section 21 will have a similar effect under the 1971 Act. Section 20 provides for the repeal of section 3 of the Redundancy Payments Act 1971, which imposes an upper age limit for entitlement to redundancy payments and section 23 repeals section 5 of the 1979 Act.

Section 25 provides for a technical amendment to be made to section 2 of the Unfair Dismissals Act 1977. It reconstructs a proviso, which was inserted into section 2(2) of the 1977 Act by the Unfair Dismissals (Amendment) Act 1993, within the new sections 2(2A) and 2(2B). The proviso relates to exceptions in certain circumstances to the general non-applicability of the Unfair Dismissal Acts 1977 to 2005 to fixed-term and specified-purpose contracts. The purpose of the amendment is to make it clear that the exception stated in the proviso covers all the types of fixed-term and specified-purpose contracts described in section 2(2) of the 1977 Act and not simply those referred to in paragraphs (a) and (b).

Section 26 provides for the amendment of section 5 of the Unfair Dismissals Act 1977 by providing that, in cases in which all the employees who are involved in a lock-out, strike or industrial action situation are dismissed, the reasonableness or otherwise of the actions of the parties is to be taken into account in determining whether the dismissals were unfair. Section 27 provides for the amendment of section 17 of the Employment Equality Act 1998. Section 27(1) is a technical provision that will overcome the misdescription of an amendment that was made in 2004 and section 27(2) will insert a new section 17(4) in the 1998 Act to reflect the abolition of the upper age limit for redundancy payments.

This Bill passed all Stages in the Seanad on 21 March last. I thank the Senators for their support and their comments. Some Senators, when speaking about the Irish Ferries situation, expressed their hope that this Bill will help prevent similar circumstances from developing on land. The Government intends to ensure that this Bill will give an enhanced measure of protection to workers who are compulsorily made redundant in circumstances in which they are replaced by workers on lower pay or worse terms and conditions of employment. It was pointed out in the Seanad that the payments which were made as part of the rebate paid to Irish Ferries were made on the basis of existing legislation.

Specific reference was made in the Seanad to the workers at the Castlemahon plant in County Limerick who wish to claim the 40% due to the social insurance fund from the liquidation. The Minister hopes to receive a payment as part of a preferential claim following the winding up of the company. As he has no discretion regarding the 40% that is due to the social insurance fund, he has no legal power to divert any of the money to the employees concerned if funds are recovered. A specific question was asked about the amount of funds currently held in the social insurance fund. The total amount of money spent by the fund in 2006 was €6.4 billion, of which approximately €165 million was paid in respect of statutory redundancy. Concern was expressed about the three-year term for the redundancy panel. The Minister may extend the duration of the redundancy panel if he or she is asked to do so by the Irish Congress of Trade Unions and the Irish Business and Employers Confederation. A warm welcome was given in the Seanad to the decision to take the opportunity afforded by this Bill to remove the age cap of 66 years for statutory redundancy payments.

I propose to make a small number of amendments to the text of the Bill on Committee Stage, mainly to reflect more accurately the wording of the agreement reached in Towards 2016. I acknowledge the work of the social partners in addressing the problems that arise in exceptional collective redundancy situations. The ability of the social partners to reach consensus shows the strength of the social partnership process. I thank the officials in the Department of Enterprise, Trade and Employment for the work they did in preparing the Bill, which I am pleased to bring before the House today. I hope we will be able to progress it through the House expeditiously. I look forward to hearing Members' views on the legislation.

Fine Gael supports the Protection of Employment (Exceptional Collective Redundancies and Related Matters) Bill 2007. We understand the background to the Minister of State's decision to introduce it. The Government was forced to act following the disgraceful events at Irish Ferries. I am disappointed that the workers at that company had to suffer before the Minister of State and his colleagues were alerted to the shady practices in question. This legislation will help to ensure that no such practices are encountered in future. It was unacceptable that Irish Ferries was given €4.3 million to meet the cost of making statutory redundancy payments to more than 400 Irish staff who were replaced by eastern European workers on lower pay.

The Bill before the House will establish a redundancy panel, drawn from the social partners, which may ask the Minister for Enterprise, Trade and Employment to refer dismissals to the Labour Court to determine whether they are genuine. It is entirely right that the Minister will be able to refuse to pay a redundancy rebate on the basis of a Labour Court decision. This Bill is a reflection of the new challenges faced by the new Ireland. We used to struggle to keep workers from leaving, but now we are struggling to stop the jobs we have in abundance from being devalued.

Fine Gael watched the unfolding events at Irish Ferries with a growing sense of disgust. The company's actions constituted the worst type of Dickensian exploitation we have ever seen in this country. It should be borne in mind that Irish Ferries is an Irish company that is based in Ireland. Therefore, it should be subject to this country's laws, including the legislation that provides for the minimum wage and the protection of employees and health and safety matters. Some form of legal nonsense got in the way of proper industrial relations procedures. This Bill has been introduced as a result of the actions of Irish Ferries, which was intent on maximising profits. It was not just seeking a cheaper labour force; it was looking for a criminally cheap labour force. We have established an industrial relations infrastructure that requires all sides to enter national agreements and to ensure give and take to allow for profitable companies and a strong enterprise culture but also decent pay for workers. That legislation has protected Irish workers from having jobs replaced by new arrivals. Irish Ferries has brought about a new situation that we must discuss now. The management of Irish Ferries should have been loyal to the social partnership process and those who helped it become a profitable company. I wonder if it can count on the loyalty of Irish people and depend on the loyalty of exporters, importers and tourists who were badly treated and inconvenienced throughout this drama.

I wish to raise two industrial relations matters in my constituency, one of which has ramifications outside the constituency. The Minister is aware of the position at Comerama. A commitment was given by the then Minister for Enterprise, Trade and Employment, Deputy Harney, to pay the enhanced redundancy payment arising from discussions at the national agreement. It was agreed to review the payment of one week's wages for every year worked and increase it to two week's wages. A commitment to include this was made in 2003 but legal matters and advice from the Attorney General subsequently prevented Comerama workers from benefitting from it. The workers have been denied some €900,000, or €10,000 per worker because the commitment, given in the presence of Oireachtas Members in the constituency and trade union officials, was not honoured. Despite this, SIPTU was prepared to ring-fence the problem and discuss how we could achieve most of the spirit of the agreement. Workers and shop stewards proposed certain results in good faith, based on the commitment provided by the then Minister, but the agreement was not implemented. Notwithstanding the number of times this matter has been examined by the Minister of State, the Minister and the Government it should be examined in the context of this Bill to provide a solution to the injustice inflicted on Castlecomer workers. All Oireachtas Members played a meaningful part in resolving this.

I am gratified that the dispute at Greencore, Mallow seems to be reaching an end following a decision by workers and the company to accept the Labour Court ruling. It took the company a considerable period to confirm it would abide by its obligations. The issue for beet growers remains unresolved and I regret the company has sought a judicial review. This will have a detrimental effect on payments to growers and could also have implications for former workers at Greencore in respect of pensions. The court case could be lengthy and will hold up payments to former Greencore staff and growers. The factory in Carlow closed in January and we face a further delay amid continuing uncertainty about payments. There is also concern that growers might have to pay tax on their compensation, something about which farmers are very unhappy. Will the workers and growers be treated in a manner similar to Irish Ferries workers? Clarification is needed.

Greencore has already received 7% of the EU compensation and has seen its share price increase substantially. I urge the Minister of State to ensure justice is done in this area. Local authority members in Carlow and Cork should ensure the planning classification of valuable sites in those areas is put on hold until these matters are resolved.

I wish to raise the issue of immigration and job displacement. Fine Gael and Labour sought a dialogue on immigration to Ireland to ensure the seeds of resentment and racism are not sown in this country. Events at Irish Ferries can only contribute to this. The recent dramatic growth in the rate of immigration to Ireland is resulting in what is arguably the greatest economic and social transformation of our country since independence. The transformation presents Ireland with both a major challenge and a major opportunity. Given Ireland's history of emigration and migration, we have a special responsibility to address the challenge of immigration. As Deputy Kenny stated earlier this year, as a people we understand better than most the special challenges of immigration and integrating new communities. It is time for a real national debate on these issues so we can make the necessary changes to meet these challenges. We have a chance to get this response right and to avoid the mistakes made elsewhere. Immigration and multiculturalism can be good for Ireland but the current system is not being managed well. Too many Departments and agencies are involved. We need a system that is good for the Irish and good for the immigrants. The current system serves the interests of neither.

Fine Gael has three priorities to make immigration work for Ireland. Immigrants have rights and responsibilities. They should have the right to be free of discrimination and have their contribution to the country recognised but they have the responsibility to integrate into our community, comply with our laws and respect our cultural traditions. We do not want to see a situation developing in which our immigrant population lives a separate life. We have a responsibility to facilitate and encourage this integration.

Immigration must be managed in a way that keeps Ireland safe. We must ensure Irish laws are understood and adhered to by immigrants and Irish citizens. We must send a strong message that people who want to come to this country to commit serious crime are not welcome and will be dealt with severely.

Critically, and most importantly in the context of this Bill, immigration must be a force for improving, not threatening living standards. We must protect Irish jobs and the rights of those who come to work here. As a small, open economy with a population that travels freely we must ensure the benefits of Irish workers and expertise travelling worldwide and those from other countries coming here continue. Living standards should not be threatened on either side. Companies that pay below the minimum wage should pay severe fines, and immigration levels from non-EU countries must be explicitly linked to economic conditions and the needs of the labour market.

In discussing this Bill I must address the issue of job losses and costs. Ireland has managed to sustain significant economic growth by attracting foreign direct investment but the sequence of high-profile job losses in various multinational companies is a worrying trend. It has become common practice for many high-profile companies to engage in global rationalisation, a code word for moving jobs from Ireland's high cost base. Since 2001 the Government has been warned by the National Competitiveness Council of the dangerous direction that policy was taking in respect of business costs. Nothing has been done to address the problems of energy, broadband, telecommunications, and other infrastructural problems to ensure the Irish economy is well-equipped to tackle the fierce competition we experience. Since this Government came to power it has imposed at least 50 stealth taxes and charges on businesses and consumers. Compared with the UK, electricity costs are 50% higher, landfill costs are 350% higher, insurance is 20% higher and broadband is 10% higher. Meanwhile, inflation continues to rise and now stands at 4.9%.

Competition from eastern Europe, India and China remains in its infancy but is likely to intensify significantly in years to come. No Government can afford to bury its head in the sand. All parties must consider how to cope with the enormous competition we face from overseas, in light of the burgeoning cost base in Ireland. This is essential if are to protect the strong economic base built up over the past 20 years, including the years of the Celtic tiger.

We must also ensure we are able to position Ireland as a country that can compete with other jurisdictions for the high level of graduate employment and companies that respect the Irish education system. We must provide for the upskilling required to ensure we continue to be at the cutting edge as leaders in providing the type of labour required for many of the companies that wish to come to Ireland. We cannot be complacent as regards low levels of unemployment because we can all see challenges on the horizon that must be dealt with effectively and in the context of ensuring that our high cost base does not continue to ratchet upwards. Otherwise we will have redundancies to deal with, which is unsavoury and throws up enormous difficulties for the workers concerned. Opportunities exist for people to get alternative employment, but we must ensure this continues to be the case in the event of companies finding themselves in difficulty.

Our economic situation is strong. This must continue and hopefully the potential exploitation we witness by one particular company managing to exploit a maritime law loophole can be protected by the enactment of this legislation so that the word goes out that companies which do not treat their employees properly, and where workers are exploited, will not get succour in this legislation. The co-operation between workers and employers which has been built up over 20 years must continue so that social partnership may continue in the spirit of co-operation we have seen. The amendments needed to sustain social partnership in the future must be brought forward in the principle of co-operation between employers and workers in the context of this legislation, as enshrined in Towards 2016, and must continue to be implemented.

Fine Gael will support the legislation. We may put forward one or two amendments to the legislation next week and I ask the Minister of State to reflect on some of the issues, which may seem somewhat parochial, given the age we live in. I am sure, however, he will come back to me in his usual diligent manner to deal with the difficulties in Kilkenny and Carlow, in particular as regards Greencore and the Comerama workers.

The Labour Party welcomes this Bill and will support it on Second Stage. We will probably table some amendments at the appropriate stage and the Minister of State has indicated he is likely to do the same. I therefore envisage that this Bill will have to go back to the Seanad before it is finally passed. However, we are anxious to see it enacted before the recess and commencement of the next general election campaign because it provides a measure of cover that is welcome.

We all know the genesis of the Bill is the debacle of the Irish Ferries dispute, which appalled many across the political spectrum. It showed the negative aspects of globalisation being brought home to our doorstep. The manner in which it was done did no credit to anyone involved. It brought out an unprecedented number of protestors, many of whom had come on to the streets for the first time. Many of them were in secure jobs and were in no way threatened in their employment by what had happened to the Irish Ferries workers. However, they saw, perhaps, the dismantlement of the European social model, through a loophole in this instance. It was an example of what could have been advanced by the Progressive Democrats and other political parties on the European stage to make "Europe more competitive", when three out of the world's five most competitive economies are Finland, Sweden and Denmark.. These countries probably have higher levels of social protection than this State and many others within the European Union.

Competition and competitiveness are not exclusively about wage rates. If that were the case Bangladesh would probably be the most competitive nation in the world. Let us get real about this debate and strip out those people who use the word "competitiveness" as a code for cheap or low wages, or low social protections. As we know, Irish Ferries applied to the Redundancy Fund for a sum awarded in the order of €4.5 million. The Minister of State will correct me if I am wrong, but I believe it was in that order of magnitude. On the legal advice of the Attorney General, presumably, this was paid. I regret that was the case and that the Government chose to take the legal advice of the Attorney General because I am sure the matter was not black and white.

Frequently legal advice may be presented in a manner that makes it acceptable for a particular course of action to be taken. I have been in similar situations where the legal advice could be read either way. On the assumption that the advice might have been capable of being read or interpreted either way, I would have much preferred if the Government had challenged the assertion of the company and let it allow the courts decide whether it was entitled to this compensation. That would have been a better course to take and would have given some judicial clarity to the matters for which we are now attempting to legislate. It would, at least have delayed payment to the company in question and would have sent a signal to others contemplating similar action to the effect that the restructuring of the labour force and the downgrading of its wages and conditions would not be automatically assisted by the industrial relations and employment protection process in Ireland.

However, I suspect that the presence of the Minister for Justice, Equality and Law Reform and that of the Minister for Health and Children had some influence on the action taken by the Government in that regard. Perhaps the Minister of State will respond on that in terms of the nature and clarity of the legal advice because it is an important precedent for future possibilities in this area. Certainly, it has a historical relevance that we need to get to the bottom of.

I welcome, in particular, the removal of the age limit for redundancy and related payments because the nature of our workforce is such that we will have to systematically examine the entire age threshold issue in terms of entitlement. We will have to remove the upper limit of entitlement so that we may ensure that seniors, as the politically correct would call them — I shall soon be joining that age category — can be employed should they so choose. There was a time when we would have taken direction from the Catholic Church in this regard, which would mean that, like bishops, we could work up to the age of 72. Given the improved states of health most of us now enjoy because of good nutrition, a better environment and more exercise, people in their 60s have become "the new 50s", according to those marketing various products, including long vacations. For those for whom working is their sense of fulfilment and enjoyment and who are forced out of the workplace arbitrarily because they have reached a threshold, the system is wrong and should be changed. If this Bill is a step in that overall direction, I welcome it.

The complexities of the Bill, however, perturb me as much as they did my colleague in the Seanad, Senator McDowell. If this is what the legislative creative talents of the social partners comprise, they should stick to negotiating pay deals and leave the writing of legislation to a professional Civil Service, assisted by the elected representatives in the Oireachtas and the accumulated wisdom acquired in this House. It is a dog's dinner of a Bill in terms of drafting. If anything, it demonstrates the absolute necessity for the consolidation of employment and labour law. It is a quagmire beyond belief. The Minister of State, I know, is aware of this and has no doubt attended seminars and employment conferences where literally a small employer is now at the mercy of legal blackmail. It is a biscuit, a bar, half full, half empty in terms of the interpretation of conflicting legislation, which when overlaid with health and safety regulations or equality legislation literally is a haystack in which the possibilities for clear interpretation cannot be determined. A small firm simply cannot take on the task of being able to fight that situation and surrenders several thousands simply by closing at 5 p.m., not knowing whether it was ever legally exposed. I ask the Minister to acknowledge, perhaps, that consolidation is necessary. Some efforts have been made in the area and perhaps he will update the House in his response, either on Second Stage today or later, as to where we stand in this regard.

I have a final point, following on Deputy Hogan's contribution. The Labour Party Member for Waterford, Deputy O'Shea, received from Mr. Sean Kelly, the regional industrial organiser for the Amalgamated Transport and General Workers Union, representations regarding workers in the Castlemahon poultry plant. The main contract for the plant was shifted by the owners, the O'Kane Group, out of the jurisdiction to Ballymena, Northern Ireland, where operating and labour costs are much more competitive than in the Republic. A certain number of voluntary redundancies were obtained in the cost-cutting exercise. The workers in question, in addition to the two-week statutory payment, received a three-week addition to their payments by the O'Kane Group.

The attempt at reducing operating costs did not prove to be effective and the company subsequently went into liquidation. Under labour law, the liquidator was compelled to provide a statutory redundancy and no more to the remaining workforce because preferential treatment cannot be shown to an individual creditor.

There is great talk of creating an all-Ireland economy between now and 6 May. It is unacceptable if we follow the logic of this political euphoria that a plant can be moved from west Limerick to the North of Ireland and avail of an Irish Ferries mark II scenario. If the plant had moved to County Wicklow, it would not have happened. If a company goes into liquidation yet the owner has transferred the contract, there must be some degree of continuity. I suspect this falls between company and labour law.

As Deputy Hogan stated, if we want Irish workers to buy into a sustained support for an open trans-frontier single market in the EU which carries and shares the burdens of competition and opportunity, these types of sharp practices must be shut down. Any junior certificate student doing business organisation would recognise the sharp practice involved in the Castlemahon case. The O'Kane Group, which is still in existence, must be told that some form of additional payment should be made to the remaining workers, comparable to those who took the early redundancy 12 months before the company went into liquidation.

I accept this is not close to the Bill but it does arise because of the perceived inequities in the ways some workers are treated under existing labour law for redundancies and the difference between liquidation and voluntary redundancy. It is up to Members to respond to this. The social partners might be much better employed in turning their attention to these real-life conflicts rather than attempting to second-guess the Legislature with a draft Bill. In the past, the tradition was that politicians stayed out of industrial relations disputes and the trade unions and employers stayed out of the legislative process. I see a blurring of that traditional convention. If this Bill is the quality of the legislation that comes from it, we should see no more of it.

I wish to share time with Deputies Finian McGrath and Eamon Ryan.

Is that agreed? Agreed.

Labour costs are somewhat cheaper in the North. For example, access to medical facilities is free of charge, paid for through general taxation. House prices are not roaring ahead as they are in this State. An all-Ireland economy, with harmonised taxation on the island and some of the social protections available in the North brought into this State are some ways of tackling these issues. The sooner that happens, the better for all workers on this island. Speed the day.

Sinn Féin welcomes the Bill as it has been needed for some time. It has arisen out of the disgraceful Irish Ferries dispute of little over a year ago. More than 500 Irish workers were given a payment that was masked as a voluntary redundancy when they were actually coerced into accepting it.

Under the Redundancy Payments Acts, redundancy does not merely arise where a business closes or an employer reduces the size of the workforce. The definition includes circumstances where the employer decides different or additional skills and qualifications are required for a job. With the 500 Irish Ferries redundancies, the business neither closed down nor did management downsize its operation. The same number of workers are with Irish Ferries now as before the lay-offs. The management successfully managed to replace Irish seafarers with more than 500 low-paid, non-unionised workers from eastern Europe. To top it off, the Government subsidised this callous exercise by giving Irish Ferries €4.3 million from taxpayers' pockets.

This colossal sum of money was paid to a company which claimed it needed to make over 500 crew members redundant to make the company directly more competitive. This is the same company that gives its chief executive, Eamonn Rothwell, 2.5% of the company's earnings and an annual bonus of over €420,000. This legislation is long overdue to prevent an Irish Ferries on land scenario occurring.

While Sinn Féin welcomes the Bill, there are some concerns over some provisions. Section 3(1) states the exceptional collective redundancy section will only last for three years. There is no reason to allow for this three-year trial period. There is nothing to indicate that at the end of the trial period, industrial arrangements will be such as to not require the provisions of the Bill. It is pathetic that the redundancies panel, as envisaged in the Bill, can only continue if IBEC wishes it to do so. A body that represents employers in this State should never have a veto over legislation that has been designated with the aim of protecting workers. After the Irish Ferries debacle, workers certainly need protecting. Another issue that raises an element of disquiet is contained in section 10(3) that specifies:

An employer who effects a dismissal in pursuance of a proposal for collective redundancies before the expiration of such of the periods specified in subsection (1) and in sections 9(3) and 12(1) of the Protection of Employment Act 1977 as are applicable is guilty of an offence and liable on conviction on indictment to a fine not exceeding €250,000.

Given that Irish Ferries has stated the redundancy package cost its parent company, the Irish Continental Group, €29.1 million, a fine of €250,000 seems paltry. I will seek to amend this section.

Section 15, which provides for the amendment of section 4 of the Redundancy Payments Act 1967, is welcome. This will enable employees who have reached the age of 66 years to be entitled to statutory redundancy payments. Sinn Féin has long campaigned for the abolition of this discriminatory provision.

Before I go into the details of the legislation and since we are dealing with employment protection issues, I commend Steve Staunton and the Irish football team on last night's win in Croke Park. They have got six points in five days and are third in their qualifying group. To the whingers like Eamon Dunphy, Johnny Giles and Roy Keane, I say they should leave Steve Staunton alone, let him get on with his contract and secure his employment. He is trying to do his best for his country.

The Bill provides for the establishment of a redundancy panel for the reference to it of certain proposed collective redundancies and for related action by the Minister for Enterprise, Trade and Employment. It also provides the removal of the upper age limit for entitlement to redundancy payments, makes consequential amendments to the Protection of Employment Act 1977, the Redundancy Payments Acts 1967, 1971 and 1979, the Unfair Dismissals Act 1977 and the Employment Equality Act 1998 and makes further amendments to those Acts to update penalties and in other formal respects.

Section 2 provides definitions of terms used in the Act. The definition of "industrial action" combines the content of the definition of "strike" in section 8 of the Industrial Relations Act 1946 and of "lock-out" in section 6 of the Redundancy Payments Act 1967. I raise those definitions covered in section 2 because the issue of industrial action, strikes and so on seems to have gone off the political agenda in recent years. While for the vast majority of people it is a positive development, we also want to ensure trade unions are not losing their grip and control when it comes to the issue of industrial relations. Sadly, there are thousands of workers in this State who are not members of trade unions, which is regrettable for our society and economy. We all support the trade union movement in developing a trade union that is interested in the common good. Let us re-evaluate and reflect on the positive aspects of James Connolly's teachings on these issues. There seems to be anti-trade union mood in the wider society and particularly among right wing elements here.

As trade unionists it is essential we support the most vulnerable sections of society, particularly children. To the shame of all of us Ireland has one of the highest child poverty rates in Europe. Some 10% of our children go out in the morning without proper food or warm winter clothing. The mental health services for children are inadequate or non-existent. Access to speech and language therapists is extremely limited for children with disabilities. Pre-school facilitates are extremely expensive. Some children still live in substandard buildings in 2007. This is not acceptable.

I use this opportunity to commend my union, the INTO, on its magnificent campaign in recent weeks to promote class sizes of 20:1. It put the class size issue on the political agenda. This is an example of a trade union that is working with parents and teachers and putting pressure on politicians to deliver something that is good for our children and is also an excellent investment in education.

I point out to my friends and comrades in the trade union movement that it is important we do not forget the poorer sections of society. We have seen huge price increases in vegetables, fruit, gas and electricity and a 15% increase in rents for Dublin City Council tenants, particularly for those living on the north side of Dublin and for pensioners. I call on the Minister of State and the Government to assist, as a matter of priority, our elderly, people with disabilities and working people in general as these huge price increases make it extremely difficult for them to cope and they affect their quality of life. A number of pensioners I met the other night expressed concern about the high rate of VAT on many household items.

Reference was made to the debate about the wider issue of the all-island economy. There are positive and sensible developments in regard to this issue and it is constructive to have an all-island economy. I would like the trade union movement, North and South, to work more closely together. I use this opportunity to commend the brave trade unions which stood out against sectarian violence on this island for 30 years; they did a noble job and some of them paid the price for doing so. We should not be afraid to say that in this debate.

Section 7 of the Unfair Dismissals Act 1977 has effect, with modifications, in regard to a dismissal that is one of a number of dismissals included in a collective redundancy that is determined by the Labour Court to be an exceptional collective redundancy. The compensation payable is such amount as is just and equitable but may not exceed pay for 208 weeks for an employee who had no more than 20 years' continuous service or, in the case of an employee who had more than 20 years' continuous service, pay for more than 260 weeks. When referring to this issue, I wish to raise the issue of the potential loss of jobs. I pay tribute to constituents of mine who work in Cadbury's factory in Dublin. I ask the Minister of State be vigilant about this issue because many workers are concerned about the potential loss of their jobs to low-wage economies.

I welcome this opportunity put forward a trade union perspective on this Bill.

I wish, on behalf of the Green Party, to indicate general support for the intent and delivery of this Bill. I hope we can provide for its swift passage through the Houses with possible amendments.

I agree with Deputy Quinn that the Bill is complex and when amending it, as in the case of all legislation, one has to refer to existing legislation, in this case the Redundancy Payments Act 1967. In reading the Bill I searched for a simple definition of what an exceptional collective redundancy might be. I was drawn to section 4 which sets out a definition but does define it. It refers back to the principal legislation which is later amended in section 16 of this Bill in a manner that is very difficult to define. That is important because the case in hand that led to this legislation is clear, namely the Irish Ferries dispute. There is a widespread perception that this case had huge ramifications in this State and it led to a number of people protesting about it, perhaps because to a certain extent it was a focal point for a general sense of lack of ease in our State as to whether we had control on the type of development that was occurring or that we were losing control in terms of the economy we were developing. In a sense it represented those fears in a practical and clear example.

In the maritime area of trading there are specific conditions. First, there is the lack of any real control in terms of the ILO Maritime Convention not having been signed and the EU directive on manning conditions for ferries not having been put in force. Particular circumstances apply where a workforce could be working in one state and located in another. The difficulty in reading the legislation is understanding exactly what other circumstances to which this may apply.

While that is a small point, I agree with Deputy Quinn that the partnership process has been beneficial for certain developments in our society. As to whether it should become the legislative body for our State is very much in question. On a number of occasions during the five years since I was elected to this House, I have seen legislation primarily coming out of partnership discussions rather than from a Department, Government or a party in this House. When I read through those Bills, I sometimes had concerns that such discussions were not a good source for legislative change. By all means they should have an influence and a role but them being the primary driver and author of legislation comes across to me as complicated and not particularly clear.

An example of those concerns — this is not to raise a major criticism — is the slight concern I have that we are setting up a complicated procedure. I stand to be corrected, but in layman's language the way I envisage this procedure working is that a request would be sent to the Secretary General of the Department to investigate a matter, he or she would notify the Minister who would refer it to the redundancy panel we are establishing, and it would return to the Minister with a suggestion that it might be referred to the Labour Court, which might make a recommendation and which could be appealed to the Employment Appeals Tribunal. I do not know whether that is a fair summary of the procedures that would be involved. That process is pretty complicated.

It does keep the social partners in play from the redundancy panel onwards.

It does. I hope the criticism I voiced will be taken constructively.

I agree with Deputy Quinn on another matter. As a small employer in the past, I appreciate it is incredibly difficult for an enterprise with fewer than 200 or 300 employees to have the scale and ability to follow in a meaningful way some of the employment legislation we draft and the regulations in place to comply with them in the first instance and, second, to follow the procedures established under them. In nine times out of ten it is not worth the trouble of pursuing the proper procedures and they hope to get out of it in whatever way they can. The same could apply to workers who may not have trade union representation or the collective might to achieve a just and correct settlement. There is a need to amalgamate employment legislation and to introduce new legislation that is not a difficult regulatory burden on either employers or workers acting collectively.

I do not share the concerns about the three-year review and legislation can easily be amended further if there is amalgamation of employment legislation.

The issue is important because there are different difficulties in every work situation and there are cases of entire companies being transferred. We need to be concerned about what is happening in the economy. I refer to the case of a national newspaper where there is a proposal to dispense with a section of the business by means of a redundancy process and the setting up of a contract agency to provide the same function. This may be beneficial in terms of a more flexible enterprise culture but it may also allow for certain practices of concern such as the drafting in of labour standards which are below the desired standard. I do not wish to imply this applies to the case to which I have referred but there is a general concern that the migration of cheap labour combined with lower labour standards may not just apply in the high profile cases but may also apply in many other cases. It is important to have definition and clarity and I look forward to teasing out these issues on Report Stage. I commend the Bill to the House and give it my party's support.

I apologise to Members for having raced through my introductory speech in order to ensure that everybody had an opportunity to speak.

I can exercise some discretion at this stage with regard to the Minister of State.

I will try to address the points because they are important. I may have to return to Deputies at a later stage in some cases.

That is fair enough.

Deputy Hogan and everybody else raised the issue of Irish Ferries and the new challenges faced by this country and the economy concerning the devaluation of jobs. I will deal with this issue in more detail when I address the points raised by Deputy Quinn which are very specific.

Deputy Hogan and others also raised the question of the loyalty of the workers of Irish Ferries. It appears that despite all the concerns the company appears to continue to enjoy the support of many of the exporters and others who use its services such as Irish people and tourists, which is somewhat strange, in my view. He also raised the issue of the Comerama workers and the difficulties relating to their redundancy payments. Deputy Quinn and others including myself have attended meetings on this issue. The workers understood they had been given an undertaking about the enhanced redundancy. A number of difficulties arose. Approximately six months elapsed between the closure of Comerama and the introduction of the increased rates of statutory redundancy. During that time a considerable number of other workers, in excess of 12,000, became redundant. It would have been impossible to introduce the enhanced rates for the Comerama workers and not make them available to the other workers whose redundancy occurred during that interim period. By extension, this also raised issues to do with other workers who had been made redundant at previous stages during interim periods and it became impossible to deal with it. To ring-fence a specific scheme for Comerama workers became impossible even though many of us would have wished it were different. I know the disappointment of the Members from Carlow-Kilkenny and others feel about similar situations.

Deputy Hogan raised a number of issues about Greencore, some relating to the outcome for workers and others relating to the outcome for growers in both Carlow and Mallow. Members will be aware of the difficulties which arose over a long period of time, from 26 April of last year when the issue was first adjudicated on by the Labour Court. Subsequent clarifications did not advance matters very far since management were not moving from a particular interpretation. Fortunately some progress has been made in recent days and both sides returned to the Labour Court on 19 February for additional talks. I understand that the original difference between the two sides which would have amounted to approximately €4.4 million has been somewhat divided and is slightly higher than the half-way stage in terms of the workers' perception of what they needed. I understand a resolution may be on the way.

I am unsure of what implications are feared by Deputy Hogan for the Carlow workers as I understand their situation had been resolved previously but I will return to the Deputy if I have any new information. He also raised the important question of the migration of work. It is imperative we protect Irish jobs and those of others who have worked in our economy. He referred to high profile job losses in the context of global rationalisation over which a small open economy such as this has little influence. Such an economy has great difficulty in setting terms which it can stand over.

The redundancy figures for 2006 amount to approximately 24,500 which is similar to the previous year and lower than two years prior. Despite the publicity surrounding job losses the out turn for the first two months of this year are 2% higher than last year which is similar to 2005 and lower than the two previous years. There does not seem to be a pattern of much higher levels of redundancy and this is against a background of job creation rates of 85,000 last year and economic growth of approximately 6% last year which is very positive. Nevertheless I take the Deputy's point that there are new challenges with regard to competitiveness and to cost base, which we sometimes place as the only factor when, as Deputy Quinn stated, there are many other factors such as productivity and the other advantages enjoyed by people who have the benefit of an Irish workforce. Because we hear all the negative stories, we tend to forget that there are very positive elements regarding the input of Irish workers, which is all the more reason we in this House should be willing to put legislative change in place to defend those workers and their rights.

Deputy Quinn asked a number of questions about Irish Ferries and also referred to the negative effects of globalisation. He asked specific questions about the redundancy fund which paid some €4.5 million to Irish Ferries. I can assure Deputy Quinn that the Minister, Deputy Martin and I considered the legal advice very carefully. We considered many options including those referred to by the Deputy, some of which in political terms would have been a lot more attractive than paying. However, on the basis of the existing legislative position and the legal advice regarding it, there did not appear to be any justification to let the matter go to the court or to refer it onwards to the Employment Appeals Tribunal which in certain circumstances might have been an option. Having carefully considered the information supplied by Irish Ferries and additional information which was sought from it and the legislative framework, there really was no option but to pay the rebate on the basis of the current legislation. This is one of the reasons that this piece of legislation is even more vital.

Deputy Quinn and a number of other speakers referred to the social partners and their positive role in many areas of life. He harboured some doubts about their capacity to write legislation. The Deputy will be less than pleased when he sees some of the amendments I propose to introduce because they reflect more closely the terms of the Towards 2016 partnership agreement. Both sides of the partnership have made strong representations to the effect that what we have done in the legislation does not mirror exactly what was agreed in the agreement.

The function of the Houses of the Oireachtas is to enact legislation. I am aware that some of our colleagues — neither the Acting Chairman nor Deputy Quinn is among them — are strongly of the view that only people elected to the Houses of Parliament should have a direct involvement in the drafting of legislation or an influence on such legislation. I have come to appreciate that the social partnership model has achieved a number of things. It has enhanced the model of democracy that operates in this country and ensured the inclusion of many who would otherwise have been excluded from the process. While I sometimes vehemently disagree with some of the proposals made by one side or the other — sometimes both — it is a particular advantage to our democratic system that ideas are fed through from the social partners. Ultimately, however, it is the responsibility of the Dáil and the Upper House to ensure we have good legislation. If social partnership were diminishing the powers of the Houses in that regard, we would have reason to be concerned and the matter would have to be addressed.

It is only the quality of the legislation that is at issue, not the intent.

That is a fair point. I will give careful consideration to some of the amendments to which I refer.

If the foundation is off-line, the first and second floors will also be off-line.

I will bear that in mind when considering the amendments and any others tabled by the Deputy and others.

I am interested in Deputy Quinn's call for a consolidation of labour law. When I was appointed to this position two years ago, I thought that what the Deputy suggests was one of the most urgent jobs that needed to be done. In the interim, events involving Gama, Irish Ferries and other companies have thrown up the need for urgent legislation such as that before the House.

I appreciate that.

I hope my successor, when various items of legislation have been enacted either later this year or early next year, will have an opportunity to consolidate the various items of labour law. If he or she does not do so, it will become impossible for even the most experienced practitioner to know exactly what is involved. As a result, the effect of the legislation and the benefits that might arise on foot of it would undoubtedly be diminished to some degree.

There is a commitment in Towards 2016 to a number of items of legislation and I will outline the position in respect of them. The Work Permits Act has been in operation since 1 February. I hope the Bill before us will be enacted in the near future. A huge amount of work is ongoing in the restatement of the Unfair Dismissals Acts. I had hoped we would deal with the employment agency regulation Bill during the lifetime of this Parliament but, sadly, that will not prove to be the case. The employment law compliance Bill is important legislation and must be enacted before we commence the process of consolidation. I strongly agree with the Deputy that a consolidation of labour law is necessary.

On Castlemahon poultry, I take the point in respect of the all-Ireland economy. The logic behind moving a firm from Limerick to Antrim and treating workers as badly as the O'Kane Group treated those at Castlemahon really rankles with me. It would rankle with anyone who examines the implications, particularly in view of the fact that voluntary redundancy packages were on offer a short period before the move was announced. When one takes account of this matter and the fact that a huge proportion of the existing market in this area is to be found on the southern part of the island, it is immensely frustrating that the initial proposal — it was entirely illegal — put to us was that we should consider allocating whatever moneys that were returned to the fund at the end of the liquidation process to the workers. It is not too much to ask that the O'Kane Group should address its responsibilities in respect of this matter in a much more forthright and robust manner than has heretofore been the case. We tried to drive that message home to the company but sadly with no great success.

This matter has upset many. In a future era when there is more co-operation between North and South and among countries across the European Union, it would be very much in everyone's interests if companies were not allowed to move operations from one part of this island to another or from one region of Europe to another. The latter was the case as regards Irish Ferries and its mistreatment of certain people. Whoever represents Ireland at meetings of the EU Council of Ministers, the European Parliament and the European Commission in the future will have a responsibility to try to progress matters in this regard. If this matter is not dealt with, in the short term people in a small open economy such as Ireland could well be the first victims. However, everyone will eventually be picked off. It is, therefore, in everybody's interests that this matter is addressed.

Deputy Morgan also referred to Irish Ferries. He made a valid point in respect of section 3(1) of the Bill and the three-year trial period following enactment. The Minister of the day will be empowered to extend this provision, ideally with the agreement of the social partners. If, however, one of the social partners were to come forward with a veto in respect of something that was working well, the legislative provisions and the powers of the House would be invoked in order to ensure this could not take effect.

On section 10(3), Deputy Morgan stated the fine of €250,000 was paltry. This amount represents a huge increase on the current figure of €3,000. I am aware that Deputy Quinn is of the opinion that the fine should be levied per employee. Deputy Morgan's point regarding the fine's impact in the context of the overall costs relating to the Irish Ferries case appears to make the amount quite small. I will consider the matter prior to Committee Stage. We are increasing the fine from €3,000 to €250,000. I will keep an open mind on the subject but I am not making any guarantees in that regard.

Deputy Finian McGrath made the point that industrial action appeared to be if not quite off the agenda, then close to being so. While he expressed some reservations, everyone would agree that this is generally a positive development. I agree strongly with his disappointment regarding the relatively small level of union membership in Ireland. The added representation that individual workers would enjoy under the social partnership framework if they were members of trade unions would be a great development and the benefit this would have, in both directions, for the workplace would be extraordinary. I hope we will see some developments in this regard. To be fair to the social partners, Towards 2016 contains a major consideration in respect of the life cycle. That is a positive development.

Deputy Finian McGrath also referred to Cadburys. We have been following that matter closely and I assure him that anything that can be done will be done.

Deputy Eamon Ryan made the point that he had difficulty following some of elements of the definitions. I was conscious, in the light of the speed with which I made my initial contribution, that I was not making it any easier for people to understand what was involved. The Deputy also referred to the ILO maritime provisions and the EU ferries directive which will definitely have to be put in place if progress is to be made.

Deputy Eamon Ryan indicated that he had some concerns about social partnership gaining responsibility for legislative provision. I would sometimes be a little more pleased if legislative proposals emanated from within the country at social partnership level rather than coming from the outside in the form of EU directives. In most cases, however, the impact of such directives has been to move us to where we should be much more quickly than would be the case if we were left to our own devices. That has been a positive development.

Question put and agreed to.

Acting Chairman

When is it proposed to take Committee Stage?

It is proposed to take Committee and Remaining Stages on Thursday of next week.

Subject to the agreement of the Whips.

Acting Chairman

Is that agreed? Agreed.

Committee Stage ordered for Thursday, 5 April 2007.